0001493152-21-002062.txt : 20210129 0001493152-21-002062.hdr.sgml : 20210129 20210129090022 ACCESSION NUMBER: 0001493152-21-002062 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 54 CONFORMED PERIOD OF REPORT: 20201231 FILED AS OF DATE: 20210129 DATE AS OF CHANGE: 20210129 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Vitality Biopharma, Inc. CENTRAL INDEX KEY: 0001438943 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-COMMERCIAL PHYSICAL & BIOLOGICAL RESEARCH [8731] IRS NUMBER: 753268988 STATE OF INCORPORATION: NV FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-53832 FILM NUMBER: 21568346 BUSINESS ADDRESS: STREET 1: 1901 AVENUE OF THE STARS, 2ND FLOOR CITY: LOS ANGELES STATE: CA ZIP: 90067 BUSINESS PHONE: 530-231-7800 MAIL ADDRESS: STREET 1: 1901 AVENUE OF THE STARS, 2ND FLOOR CITY: LOS ANGELES STATE: CA ZIP: 90067 FORMER COMPANY: FORMER CONFORMED NAME: Stevia First Corp. DATE OF NAME CHANGE: 20111020 FORMER COMPANY: FORMER CONFORMED NAME: Legend Mining Inc. DATE OF NAME CHANGE: 20080630 10-Q 1 form10-q.htm

 

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended December 31, 2020

 

[  ] TRANSITION REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from _____ to _____

 

Commission File Number: 000-53832

 

VITALITY BIOPHARMA, INC.

(Exact name of registrant as specified in its charter)

 

Nevada   75-3268988

(State or other jurisdiction of

incorporation or organization)

 

(I.R.S. Employer

Identification No.)

 

1901 Avenue of the Stars, 2nd Floor    
Los Angeles, CA   90067
(Address of principal executive offices)   (Zip Code)

 

(530) 231-7800

Registrant’s telephone number, including area code

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class:   Trading Symbol   Name of each exchange on which registered*:
Common Stock   VBIO   -

 

*The Company’s common stock trades with limited liquidity on the grey market. Grey market stocks are not traded or quoted on an exchange or inter-dealer quotation system, but are reported by broker-dealers to their self-regulatory organization who, in turn, distribute the trade data to market data vendors and financial websites.

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [  ]

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes [X] No [  ]

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer,” “non-accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer [  ] Accelerated filer [  ]
Non-accelerated filer [X] Smaller reporting company [X]
  Emerging growth company [  ]

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes [  ] No [X]

 

As of January 28, 2021, there were 50,840,147 shares of the registrant’s common stock outstanding.

 

 

 

 

 

 

VITALITY BIOPHARMA, INC.

Quarterly Report on Form 10-Q

For the Quarterly Period Ended

December 31, 2020

 

INDEX

 

PART I - FINANCIAL INFORMATION 3
   
Item 1. Financial Statements (unaudited) 3
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations 15
Item 3. Quantitative and Qualitative Disclosures About Market Risk 20
Item 4. Controls and Procedures 20
   
PART II - OTHER INFORMATION 21
   
Item 1. Legal Proceedings 21
Item 1A. Risk Factors 21
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 21
Item 6. Exhibits 22
   
SIGNATURES 23

 

2

 

 

PART I - FINANCIAL INFORMATION

 

Item 1. Financial Statements (unaudited)

 

VITALITY BIOPHARMA, INC.

CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

THREE AND NINE MONTHS ENDED DECEMBER 31, 2020 AND 2019

(Unaudited)

 

CONDENSED CONSOLIDATED UNAUDITED BALANCE SHEETS 4
   
CONDENSED CONSOLIDATED UNAUDITED STATEMENTS OF OPERATIONS 5
   
CONDENSED CONSOLIDATED UNAUDITED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY 6
   
CONDENSED CONSOLIDATED UNAUDITED STATEMENTS OF CASH FLOWS 7
   
NOTES TO THE CONDENSED CONSOLIDATED UNAUDITED FINANCIAL STATEMENTS 8

 

3

 

 

VITALITY BIOPHARMA, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

 

   December 31, 2020   March 31, 2020 
    (unaudited)      
Assets          
           
Current Assets          
Cash and cash equivalents  $1,441,471   $2,392,225 
Prepaid expenses and other current assets   13,195    15,666 
Total current assets   1,454,666    2,407,891 
Deposits   26,157    35,752 
Operating lease right-of-use asset   22,817    123,606 
           
Total Assets  $1,503,640   $2,567,249 
           
Liabilities and Stockholders’ Equity          
           
Current Liabilities          
Accounts payable and accrued liabilities  $72,078   $862,528 
Advance   296,653    296,653 
Operating lease liability, short-term   23,194    125,679 
Total current liabilities   391,925    1,284,860 
           
Total liabilities   391,925    1,284,860 
           
Commitments and contingencies   -    - 
           
Stockholders’ Equity          
Common stock, par value $0.001 per share; 1,000,000,000 shares authorized; 50,840,147 shares issued and outstanding   50,640    50,640 
Additional paid-in-capital   48,128,153    47,778,607 
Accumulated deficit   (47,067,078)   (46,546,858)
Total stockholders’ equity   1,111,715    1,282,389 
Total Liabilities and Stockholders’ Equity  $1,503,640   $2,567,249 

 

See accompanying notes to the condensed consolidated financial statements.

 

4

 

 

VITALITY BIOPHARMA, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

 

   Three Months Ended
December 31,
   Nine Months Ended
December 31,
 
   2020   2019   2020   2019 
Revenues  $-   $-   $-   $- 
                     
Operating expenses:                    
General and administrative   394,567    506,926    1,342,110    2,094,026 
Research and development   71,975    241,840    338,268    864,849 
Total operating expenses   466,542    748,766    1,680,378    2,958,875 
                     
Loss from operations   (466,542)   (748,766)   (1,680,378)   (2,958,875)
                     
Other income (expense)                    
Change in fair value of derivative liability   -    1,711    -    35,625 
Gain on extinguishment of note payable   97,516    -    97,516    - 
Gain on settlement   1,062,405    -    1,062,405    - 
Other   (429)   529    237    24,053 
Total other income (expense), net   1,159,492    2,240    1,160,158    59,678 
                     
Income (loss) from continuing operations   692,950    (746,526)   (520,220)   (2,899,197)
                     
Loss from discontinued operations   -    (48,769)   -    (714,827)
                     
Net income (loss)  $692,950   $(795,295)  $(520,220)  $(3,614,024)
                     
Net income (loss) per common share                    
Income (loss) from continuing operations  $0.01   $(0.01)  $(0.01)  $(0.06)
Loss from discontinued operations  $-   $(0.00)  $-   $(0.01)
                     
Weighted average number of common shares outstanding                    
Basic and diluted   50,840,147    50,840,147    50,840,147    51,773,420 

 

See accompanying notes to the condensed consolidated financial statements.

 

5

 

 

VITALITY BIOPHARMA, INC.

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY

THREE AND NINE MONTHS ENDED DECEMBER 31, 2020 AND 2019

 

   Three months ended December 31, 2020 (Unaudited) 
   Common Stock   Additional         
   Number of shares   Amount   Paid-in Capital   Accumulated Deficit   Total 
Balance – September 30, 2020   50,840,147   $50,640   $48,015,844   $(47,760,028)  $306,456 
Fair value of vested stock options   -    -    112,309    -    112,309 
Net income   -    -    -    692,950    692,950 
Balance as of December 31, 2020 (Unaudited)   50,840,147   $50,640   $48,128,153   $(47,067,078)  $1,111,715 

 

   Three months ended December 31, 2019 (Unaudited) 
   Common Stock   Additional         
   Number of shares   Amount   Paid-in Capital   Accumulated Deficit   Total 
Balance as of September 30, 2019   50,840,147   $50,640   $47,502,211   $(45,000,232)  $2,552,619 
Fair value of vested stock options   -    -    142,282    -    142,282 
Net loss   -    -    -    (795,295)   (795,295)
Balance as of December 31, 2019 (Unaudited)   50,840,147   $50,640   $47,644,493   $(45,795,527)  $1,899,606 

 

   Nine months ended December 31, 2020 (Unaudited) 
   Common Stock   Additional         
   Number of shares   Amount   Paid-in Capital   Accumulated Deficit   Total 
Balance – March 31, 2020   50,840,147   $50,640   $47,778,607   $(46,546,858)  $1,282,389 
Fair value of vested stock options   -    -    349,546    -    349,546 
Net loss   -    -    -    (520,220)   (520,220)
Balance as of December 31, 2020 (Unaudited)   50,840,147   $50,640   $48,128,153   $(47,067,078)  $1,111,715 

 

    Nine months ended December 31, 2019 (Unaudited)  
    Common Stock     Additional              
    Number of shares     Amount     Paid-in Capital     Accumulated Deficit     Total  
Balance as of March 31, 2019     52,290,147     $ 52,090     $ 47,150,489     $ (42,181,503 )   $ 5,021,076  
Cancellation of shares     (1,450,000 )     (1,450 )     1,450       -       -  
Fair value of vested stock options     -       -       492,554       -       492,554  
Net loss     -       -       -       (3,614,024 )     (3,614,024 )
Balance as of December 31, 2019 (Unaudited)     50,840,147     $ 50,640     $ 47,644,493     $ (45,795,527 )   $ 1,899,606  

 

See accompanying notes to the condensed consolidated financial statements.

 

6

 

 

VITALITY BIOPHARMA, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

 

   Nine Months Ended December 31, 
   2020   2019 
         
Cash flows from operating activities          
Net loss  $(520,220)  $(3,614,024)
Loss from discontinued operations   -    714,827 
Loss from continuing operations   (520,220)   (2,899,197)
Adjustments to reconcile net loss to net cash used in operating activities          
Fair value of vested stock options   349,546    492,554 
Operating lease expense   100,789    93,845 
Change in fair value of derivative liability   -    (35,625)
Gain on settlement, net of cash received of $450,000   (612,405)   - 
Gain on extinguishment of note payable   (97,516)   - 
Accrual of interest added to note payable   528    - 
Changes in operating assets and liabilities:          
Prepaid expense and other current assets   2,471    24,598 
Deposits   9,595    (10,000)
Accounts payable and accrued liabilities   (178,045)   292,521 
Accounts payable - related party   -    (5,200)
Operating lease liability   (102,485)   (97,954)
Net cash used in operating activities- continuing operations   (1,047,742)   (2,144,458)
Net cash used in operating activities- discontinued operations   -    (714,883)
           
Net cash used in operating activities   (1,047,742)   (2,859,341)
           
Cash flows from financing activities:          
Proceeds from note payable   96,988    - 
Net cash provided by financing activities   96,988    - 
           
Net decrease in cash   (950,754)   (2,859,341)
           
Cash and cash equivalents - beginning of period   2,392,225    5,982,741 
Cash and cash equivalent - end of period  $1,441,471   $3,123,400 
           
Supplemental disclosure of cash flow information:          
Cash paid during the period for:          
Interest  $-   $- 
Income taxes  $-   $- 
Supplemental non-cash investing and financing activities:          
Initial recognition of operating lease right-of-use assets and operating lease obligations upon adoption of new lease accounting standard  $-   $248,425 
Cancellation of shares  $-   $1,450 

 

See accompanying notes to the condensed consolidated financial statements.

 

7

 

 

VITALITY BIOPHARMA, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

THREE AND NINE MONTHS ENDED DECEMBER 31, 2020 AND 2019

(Unaudited)

 

1. BUSINESS OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Vitality Biopharma, Inc. (the “Company”, “we”, “us” or “our”), was incorporated in the State of Nevada on June 29, 2007. The Company’s fiscal year end is March 31.

 

The Company is engaged in the research and development of cannabinoid prodrug pharmaceuticals, which we refer to as cannabosides. We discovered these cannabosides through application of the Company’s proprietary enzymatic bioprocessing technologies. In 2016, the Company received approvals from the U.S. Drug Enforcement Administration (the “DEA”) and the State of California to initiate studies and manufacturing scale-up at its research and development facilities in order to develop cannabosides.

 

Liquidity

 

Since we do not have any commercial products currently available in the marketplace, the Company does not generate any revenues. As reflected in the accompanying financial statements, during the nine months ended December 31, 2020, the Company incurred a net loss of $520,220 and used $1,047,742 of cash in our operating activities. As of December 31, 2020, we had $1,441,471 of cash on hand, stockholders’ equity of $1,111,715 and had working capital of $1,062,741.

 

Our total expenditures for the twelve months following December 31, 2020, are expected to be approximately $1,000,000, which is comprised of research and development and general operating expenses. Based on the funds we had available on December 31, 2020, we believe that we have sufficient capital to fund our anticipated operating expenses for at least one year from the date that the financial statements in this report are issued.

 

On November 7, 2018, the SEC suspended the trading of our common stock. Our common stock resumed trading with limited liquidity on the grey market on November 21, 2018. Grey market stocks are not traded or quoted on an exchange or inter-dealer quotation system, but are reported by broker-dealers to their self-regulatory organization (“SRO”) and the SRO distributes the trade data to market data vendors and financial websites. Since grey market securities are not traded or quoted on an exchange or inter-dealer quotation system, investor’s bids and offers are not collected in a central spot, so market transparency is diminished and execution of orders is difficult. We are actively pursuing the resumption of ordinary course trading status on the OTCQB.

 

In September 2020, we retained DelMorgan & Co., an internationally recognized investment banking firm, to advise us on our strategic alternatives, including potential financings, asset divestitures or strategic partnerships. The Company is continuing to work closely with DelMorgan in support of their retention.

 

While we believe that our existing cash balances will be sufficient to fund our currently planned level of operations, we may require additional financing to fund our planned future operations. We do not have any firm commitments for future capital and until the Company’s securities resume ordinary course trading on the OTCQB (or are listed on a national exchange) it will be difficult to obtain financing on commercially reasonable or acceptable terms. We do not presently have, nor do we expect in the near future to have, material revenue to fund our business from our operations, and we will need to obtain all of our necessary funding from external sources in the near term. Additional financing may be required to fund our planned operations in future periods, including research and development activities relating to our principal product candidate, seeking regulatory approval of that or any other product candidate we may choose to develop, commercializing any product candidate for which we are able to obtain regulatory approval or certification, seeking to license or acquire new assets or businesses, and maintaining our intellectual property rights and pursuing rights to new technologies. We may seek to raise such funding from a variety of sources. If we raise additional funds by issuing equity or convertible debt securities, our existing stockholders’ ownership may be diluted, and obtaining commercial loans would increase our liabilities and future cash commitments. If we pursue capital through alternative sources, such as collaborations or other similar arrangements, we may be forced to relinquish rights to our proprietary technology or other intellectual property that could result in our receipt of only a portion of any revenue that may be generated from a partnered product or business. Further, we may not be able to obtain additional financing from any of these sources on commercially reasonable or acceptable terms when needed, or at all. If we cannot raise the money that we need in order to continue to operate and develop our business, we will be forced to delay, scale back or eliminate some or all of our operations. If any of these were to occur, there is a substantial risk that our business would fail and our stockholders could lose all of their investment.

 

8

 

 

Further, these estimates could differ if we encounter unanticipated difficulties, or if our estimates of the amount of cash necessary to operate our business prove to be wrong, and we use our available financial resources faster than we currently expect.

 

COVID-19 Considerations

 

The global outbreak of COVID-19 has led to significant disruptions in the global economy, including the curtailment of activities by businesses and consumers in much of the world as governments and others seek to limit the spread of the disease. The extent of the impact of the pandemic on our business and financial results will depend largely on future developments, including the duration and severity of the outbreak, the length of restrictions and business closures imposed by domestic and foreign governments, the impact on capital and financial markets, all of which are highly uncertain and cannot be predicted. In the quarter ended December 31, 2020, the COVID-19 pandemic did not have a material net impact on our operating results. We have also not observed any material impairments of our assets or a significant change in the fair value of our assets due to the COVID-19 pandemic. While it is not possible at this time to estimate the full impact that COVID-19 will have on our business, restrictions resulting from COVID-19 on general economic conditions could, among other things, impair our ability to raise capital when needed. This situation is changing rapidly, and additional impacts may arise that we are not aware of currently.

 

Basis of Presentation of Unaudited Condensed Financial Information

 

The unaudited condensed financial statements of the Company for the three and nine months ended December 31, 2020 and 2019 have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information, applied on a consistent basis, and pursuant to the requirements for reporting on Form 10-Q and the requirements of Regulation S-K and Regulation S-X promulgated under the Securities Act of 1933, as amended (the “Securities Act”). Accordingly, they do not include all the information and footnotes required by U.S. GAAP for complete audited financial statements. However, the information included in these financial statements reflects all adjustments (consisting solely of normal recurring adjustments), which are, in the opinion of management, necessary for the fair presentation of the Company’s financial position and the results of operations. Results shown for interim periods are not necessarily indicative of the results to be obtained for a full fiscal year or any future annual or interim period. The balance sheet information as of March 31, 2020 was derived from the Company’s audited financial statements as of and for the year ended March 31, 2020 included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (the “SEC”) on June 29, 2020. These financial statements should be read in conjunction with that report.

 

Estimates

 

The preparation of financial statements in conformity with generally accepted accounting principles in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the period. Actual results could differ from those estimates. Significant estimates and assumptions by management include, among others, the fair value of equity instruments issued for services, and assumptions used in the valuation of derivative liabilities and the valuation allowance for deferred tax assets, and the accrual of potential liabilities.

 

Financial Assets and Liabilities Measured at Fair Value

 

The Company uses various inputs in determining the fair value of its investments and measures these assets on a recurring basis. Financial assets recorded at fair value in the balance sheets are categorized by the level of objectivity associated with the inputs used to measure their fair value. Authoritative guidance provided by FASB defines the following levels directly related to the amount of subjectivity associated with the inputs:

 

Level 1   Quoted prices in active markets for identical assets or liabilities.
     
Level 2   Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly.
     
Level 3   Unobservable inputs based on the Company’s assumptions.

 

9

 

 

The carrying amounts of financial assets and liabilities, such as cash and cash equivalents, accounts payable, notes payable and advance, approximate their fair values because of the short maturity of these instruments.

 

Derivative Financial Instruments

 

The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported in the statements of operations. For stock-based derivative financial instruments, the Company uses a probability weighted average Black-Scholes-Merton model to value the derivative instruments at inception and on subsequent valuation dates. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period.

 

Share-Based Payments

 

The Company periodically issues stock options, warrants, and shares of common stock as share-based compensation to employees and non-employees in non-capital raising transactions for services and for financing costs. The Company accounts for such grants issued and vesting based on FASB ASC 718, Compensation – Stock Compensation (Topic 718) whereby the value of the award is measured on the date of grant and recognized as compensation expense on the straight-line basis over the vesting period. The Company recognizes the fair value of stock-based compensation within its Statements of Operations with classification depending on the nature of the services rendered.

 

The fair value of the Company’s stock options and warrants are estimated using the Black-Scholes-Merton Option Pricing model which uses certain assumptions related to risk-free interest rates, expected volatility, expected life of the stock options or restricted stock, and future dividends. Compensation expense is recorded based upon the value derived from the Black-Scholes-Merton Option Pricing model and based on actual experience. The assumptions used in the Black-Scholes-Merton Option Pricing model could materially affect compensation expense recorded in future periods.

 

Basic and Diluted Loss Per Share

 

Basic loss per share is computed by dividing the net loss applicable to common stockholders by the weighted average number of outstanding common shares during the period. Diluted loss per share is computed by dividing net loss applicable to common stockholders by the weighted average number of common shares outstanding plus the number of additional common shares that would have been outstanding if all dilutive potential common shares had been issued. Diluted loss per share excludes all potential common shares if their effect is anti-dilutive. The following potentially dilutive shares were excluded from the shares used to calculate diluted earnings per share as their inclusion would be anti-dilutive:

 

   Nine months ended 
   December 31, 2020   December 31, 2019 
Options   5,997,544    6,546,710 
Warrants   146,668    1,135,003 
Total   6,144,212    7,681,713 

 

10

 

 

Research and Development

 

Research and development costs consist primarily of fees paid to consultants and outside service providers, patent fees and costs, and other expenses relating to the acquisition, design, development and testing of the Company’s product candidates. Research and development costs are expensed as incurred.

 

Recent Accounting Pronouncements

 

In June 2016, the FASB issued ASU No. 2016-13, Credit Losses - Measurement of Credit Losses on Financial Instruments (“ASC 326”). ASU 2016-13 requires entities to use a forward-looking approach based on current expected credit losses (“CECL”) to estimate credit losses on certain types of financial instruments, including trade receivables. This may result in the earlier recognition of allowances for losses. ASU 2016-13 is effective for the Company beginning April 1, 2023, and early adoption is permitted. The Company does not believe the potential impact of the new guidance and related codification improvements will be material to its financial position, results of operations and cash flows.

 

In August 2020, the FASB issued ASU No. 2020-06 (“ASU 2020-06”) Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. ASU 2020-06 will simplify the accounting for convertible instruments by reducing the number of accounting models for convertible debt instruments and convertible preferred stock. Limiting the accounting models will result in fewer embedded conversion features being separately recognized from the host contract as compared with current GAAP. Convertible instruments that continue to be subject to separation models are (1) those with embedded conversion features that are not clearly and closely related to the host contract, that meet the definition of a derivative, and that do not qualify for a scope exception from derivative accounting and (2) convertible debt instruments issued with substantial premiums for which the premiums are recorded as paid-in capital. ASU 2020-06 also amends the guidance for the derivatives scope exception for contracts in an entity’s own equity to reduce form-over-substance-based accounting conclusions. ASU 2020-06 will be effective January 1, 2024, for the Company. Early adoption is permitted, but no earlier than January 1, 2021, including interim periods within that year. Management is currently evaluating the effect of the adoption of ASU 2020-06 on the consolidated financial statements, but currently does not believe ASU 2020-06 will have a significant impact on the Company’s accounting for its convertible debt instruments. The effect will largely depend on the composition and terms of the financial instruments at the time of adoption.

 

Other recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company’s present or future financial statements.

 

2. OPERATING LEASE

 

At December 31, 2020, the Company’s wholly-owned subsidiary, The Control Center, Inc., (“TCC”) has an operating lease agreement for office space that began in December 2012, and was amended in December 2015 and December 2019, and expires February 28, 2021. In addition, at December 31, 2020, TCC has a sublease agreement in place for the office space that began in September 2019 and expires February 28, 2021. TCC remains the primary obligor on the office space lease agreement. Sublease income was not significant during the three and nine months ended December 31, 2020 and 2019.

 

Leases with an initial term of 12 months or less are not recorded on the balance sheet. The Company accounts for the lease and non-lease components of its lease as a single lease component. Lease expense is recognized on a straight-line basis over the lease term. An operating lease right-of-use (“ROU”) asset and liability is recognized at commencement date based on the present value of lease payments over the lease term. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Generally, the implicit rate of interest in arrangements is not readily determinable and the Company utilizes its incremental borrowing rate in determining the present value of lease payments.

 

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The components of lease expense and supplemental cash flow information related to leases for the period are as follows:

 

  

Nine Months

Ended

December 31, 2020

 
Lease Cost     
Operating lease cost (included in general and administrative expenses in the Company’s unaudited condensed consolidated statement of operations)  $111,657 
      
Other Information     
Cash paid for amounts included in the measurement of lease liabilities for the three months ended December 31, 2020  $- 
Weighted average remaining lease term – operating leases (in years)   0.2 
Average discount rate – operating leases   4.0%

 

The supplemental balance sheet information related to leases for the period is as follows:

 

   At December 31, 2020 
Operating leases     
Long-term right-of-use asset  $22,817 
      
Short-term operating lease liability  $23,194 
Total operating lease liabilities  $23,194 

 

Maturities of the Company’s lease liabilities are as follows (in thousands):

 

Year Ending March 31  Operating Lease 
2021 (remaining 2 months)  $23,310 
Total lease payments   23,310 
Less: Imputed interest/present value discount   (116)
Present value of lease liabilities  $23,194 

 

Lease expenses were $45,970 and $139,218 during the three and nine months ended December 31, 2020, respectively.

 

3. GAIN ON EXTINGUISHMENT OF NOTE PAYABLE

 

On May 6, 2020, the Company was granted a loan (the “PPP” loan) from U.S. Bank for $96,988 pursuant to the Paycheck Protection Program under the CARES Act. The PPP loan bore interest at 1% per annum with the first six months of interest deferred, and was unsecured and guaranteed by the Small Business Administration (the “SBA”). The Company used the entire PPP loan amount for qualifying expenses as described in the CARES Act, including qualifying payroll costs, qualifying group health care benefits, qualifying rent, and qualifying utilities. On November 21, 2020, we received notice that the SBA had reviewed the forgiveness application of our PPP loan and provided forgiveness of our PPP loan of $97,516, including accrued interest of $528. We recognized a gain on extinguishment of the PPP loan of $97,516 during the three and nine months ended December 31, 2020.

 

4. GAIN ON SETTLEMENT

 

From 2016 to 2019, the Company recorded approximately $1.1 million due to a vendor for services, of which $612,405 had not been paid and was included in accounts payable at March 31, 2020 and through November 30, 2020.  In December 2020, the Company reached a settlement with the vendor to forgive the $612,405 of outstanding invoices, and in addition, the Company received a payment from the vendor of $450,000.  This resulted in a gain on settlement of $1,062,405 during the three and nine months ended December 31, 2020.

 

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5. ADVANCE

 

In July 2018, we received a payment from a third party in the amount of $250,000 and a payment of $46,653 was made on our behalf to a vendor. To date, the Company has not confirmed the nature of these payments. We have recorded these payments as an advance and at December 31, 2020 and March 31, 2020, it is included in current liabilities on the accompanying financial statements.

 

6. STOCK OPTIONS

 

A summary of the Company’s stock option activity during the nine months ended December 31, 2020 is as follows:

 

   Shares  

Weighted

Average

Exercise Price

 
Balance outstanding at March 31, 2020   6,556,710   $0.89 
Granted   -      
Exercised   -      
Expired   (32,500)   2.17 
Cancelled   (526,666)   1.42 
Balance outstanding at December 31, 2020   5,997,544   $0.91 
Balance exercisable at December 31, 2020   4,622,544   $0.87 

 

A summary of the Company’s stock options outstanding and exercisable as of December 31, 2020 is as follows:

 

   Number of Options   Weighted Average Exercise Price   Weighted Average Grant- date Stock Price 
Options Outstanding, December 31, 2020   750,000   $0.30   $0.30 
    2,000,000   $0.35   $0.35 
    1,664,542   $0.50   $0.50 
    128,000   $0.96   $0.96 
    130,000   $1.00   $10.00 
    500,834    $ 1.50 - 1.95    $ 1.50 - 1.95 
    657,500    $ 2.00 - 2.79    $ 2.00 - 2.79 
    123,334    $ 3.10 - 3.80    $ 3.10 - 3.80 
    43,334    $ 4.00 - 4.70    $ 4.00 - 4.70 
    5,997,544           
Options Exercisable, December 31, 2020   375,000   $0.30   $0.30 
    1,000,000   $0.35   $0.35 
    1,664,542   $0.50   $0.50 
    128,000   $0.96   $0.96 
    130,000   $1.00   $10.00 
    500,834    $ 1.50 - 1.95    $ $ 1.50 - 1.95 
    657,500    $ 2.00 - 2.79    $ 2.00 - 2.79 
    123,334    $ 3.10 - 3.80    $ 3.10 - 3.80 
    43,334    $ 4.00 - 4.70    $ 4.00 - 4.70 
    4,622,544           

 

During the nine months ended December 31, 2020, we expensed total stock-based compensation related to stock options of $349,546, and the remaining unamortized cost of the outstanding stock-based awards at December 31, 2020 was approximately $160,000. The remaining unamortized cost will be amortized on a straight-line basis over a weighted average remaining vesting period of one year. At December 31, 2020, the 5,997,044 outstanding stock options had no intrinsic value.

 

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7. WARRANTS

 

A summary of warrants to purchase the Company’s common stock during the nine months ended December 31, 2020 is as follows:

 

   Shares  

Weighted

Average

Exercise Price

 
Balance outstanding at March 31, 2020   1,135,003   $2.19 
Granted   -    - 
Exercised   -    - 
Expired   (988,335)   2.10 
Balance outstanding and exercisable at December 31, 2020   146,668   $3.00 

 

At December 31, 2020, the 146,668 outstanding stock warrants had no intrinsic value.

 

8. DISCONTINUED OPERATIONS

 

In October 2018, the Company acquired Summit Healthtech, Inc. (renamed Vitality Healthtech, Inc.), a specialty healthcare clinic. In addition to Summit Healthcare, the Company sold research diagnostic testing kits (collectively, the Company’s clinical and test kit operations). In May 2019 the Company decided to close its clinical and test kit operations. The clinical and test kit operations meet the discontinued operations criteria and are reported as such in all periods presented on the accompanying condensed consolidated financial statements.

 

The following table presents the summarized components of loss from discontinued operations for the clinical and test kit operations:

 

   Three Months Ended December 31, 
   2020   2019 
         
Revenue  $-   $- 
           
Cost of sales   -    - 
Research and development   -    - 
General and administrative   -    48,769 
Loss from discontinued operations  $-   $(48,769)

 

   Nine Months Ended December 31, 
   2020   2019 
         
Revenue  $-   $44,698 
           
Cost of sales   -    143,232 
Research and development   -    4,361 
General and administrative   -    611,932 
Loss from discontinued operations  $-   $(714,827)

 

9. COMMITMENTS AND CONTINGENCIES

 

SEC Investigation

 

On August 19, 2016, we filed a resale registration statement on Form S-1 (“Form S-1”) with the SEC to register 2,650,000 shares of our common stock and 7,950,000 shares of our common stock issuable upon exercise of certain warrants. We received a letter from the Washington D.C. office of the SEC dated December 10, 2016, stating that the staff of the SEC was conducting a Section 8(e) examination with respect to this Form S-1 and that the Division of Corporate Finance would not take any further action on the Form S-1 while the examination was pending. On May 12, 2020, our outside legal counsel received a letter from the staff of the SEC’s Enforcement Division stating that it has concluded the investigation as to the Company, and that it did not intend to recommend an enforcement action by the SEC against the Company. While certain former officers and directors may request the Company to reimburse them for legal fees related to this matter, at December 31, 2020, management has determined that the Company’s liability for those fees is not probable and we could not reasonably estimate those fees.

 

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

As used in this discussion and analysis and elsewhere in this Quarterly Report, the “Company”, “we”, “us” or “our” refer to Vitality Biopharma, Inc., a Nevada corporation.

 

Cautionary Statement

 

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our Unaudited Condensed Financial Statements and the related notes thereto contained in Part I, Item 1 of this Quarterly Report. The information contained in this Quarterly Report on Form 10-Q is not a complete description of our business or the risks associated with an investment in our common stock. We urge you to carefully review and consider the various disclosures made by us in this Quarterly Report and in our other reports filed with the Securities and Exchange Commission (the “SEC”), including our Annual Report on Form 10-K for the fiscal year ended March 31, 2020 filed on June 29, 2020, and the related audited financial statements and notes included therein.

 

Certain statements made in this Quarterly Report on Form 10-Q constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 (the “Exchange Act”). Forward-looking statements are projections in respect of future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “intend,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” or “continue” or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors, which may cause our or our industry’s actual results, levels of activity or performance to be materially different from any future results, levels of activity or performance expressed or implied by these forward-looking statements. These risks and uncertainties include: our ability to continue operating as a going concern; general economic and financial market conditions; our ability to obtain additional financing as necessary; any adverse occurrence with respect to our business or; results of our research and development activities that are less positive than we expect; our ability to bring our intended products to market; market demand for our intended products; shifts in industry capacity; product development or other initiatives by our competitors; fluctuations in the availability of raw materials and costs associated with growing raw materials for our intended products; other factors beyond our control; and the other risks described under the heading “Risk Factors” in our Annual Report on Form 10-K filed with the SEC on June 29, 2020.

 

Although we believe that the expectations and assumptions reflected in the forward-looking statements we make are reasonable, we cannot guarantee future results, levels of activity or performance. In addition, we cannot assess the impact of each factor on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those expressed by any forward-looking statements. As a result, readers should not place undue reliance on any of the forward-looking statements we make in this report. Forward-looking statements speak only as of the date on which they are made. Except as required by law, we undertake no obligation to revise or update publicly any forward-looking statements for any reason.

 

Company Overview

 

Vitality Biopharma is a company focused on the advancement of pharmaceuticals and innovative technologies that improve the lives of patients. We seek to achieve this objective through the development of novel cannabinoid pharmaceutical prodrugs, which we refer to as cannabosides. We conduct our operations using our own personnel and facilities with the support of third-party resources as necessary to advance our drug development programs.

 

Our cannabinoid-glycoside prodrugs, which we refer to as cannabosides, were discovered through application of the Company’s proprietary enzymatic bioprocessing technologies, that are converted within the body after administration from an inactive molecule into a pharmacologically active drug. Currently, the Company has produced more than 25 novel cannabosides, including glycosylated tetrahydrocannabinol (THC), cannabidiol (CBD), cannabidivarin (CBDV) and cannabinol (CBN), that are covered by patent applications in the United States and various other countries for composition of matter, method of production and method of use.

 

Our corporate headquarters is located in Los Angeles, California. As of January 28, 2021, we employed three full-time employees, including one research professional working in our office and laboratory space in Rocklin, California. In the past, we have engaged the services of outside scientific and regulatory consultants to assist in our research and development activities, which is an approach that provides us with flexible and highly-experienced resources to advance our clinical efforts while maintaining a relatively lower overhead cost structure.

 

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Cannaboside Prodrugs

 

A prodrug is a compound that, after administration, is metabolized into a pharmacologically active drug. Prodrugs are often designed to improve drug properties and reduce known or expected toxicities and adverse side effects. By using our proprietary enzymatic bioprocessing technologies, our clinical research team has developed a novel family of prodrugs by combining cannabinoid and glucose molecules. The resulting compounds, known as cannabosides, have unique commercial applications and patentable compositions of matter, which are separate and distinct from ordinary cannabinoids. The advantages of cannabosides may include: (i) administration in a convenient oral formulation, (ii) targeted delivery with release in the colon or large intestine, (iii) improved stability with limited degradation or drug metabolism, and (iv) delayed release enabling longer-lasting effects and fewer administrations by patients.

 

Our proprietary glycosylation process, which results in adding one or more glucose molecules to compounds, may enable our new cannabosides to act as prodrugs that achieve targeted delivery of the bioactive compounds of cannabinoids to the gastrointestinal tract. Glycosylated compounds are generally more stable and are water soluble, so upon ingestion, we believe they will remain intact and transit through the esophagus, stomach and upper intestine with limited absorption or degradation from stomach acids. However, once the glycosylated compounds reach the lower intestine, we expect them to encounter glycoside hydrolase enzymes secreted by the human intestinal microbiota that will cleave the polar glucose residues and release the active cannabinoid compound primarily in the large intestine or colon.

 

We have focused our research and development activities on the glycosylation of cannabinoids given their well-known positive effects on the human endocannabinoid system. Our research and development activities originally focused on the glycosylation of CBD and then later expanded into the glycosylation of THC. The use of the cannabinoid THC has been shown to provide substantial anti-inflammatory benefits on the human body, among other benefits, but is limited as a pharmaceutical option given its psychoactive and intoxicating properties. However, by glycosylating THC, we have learned through initial animal studies that the binding of glucose and THC molecules restricts the release of THC into the body’s digestive system until the prodrug reaches the large intestine, at which point the glycoside hydrolase enzymes cleave the glucose from the prodrug and the THC is released in a targeted and restricted manner. Further, we have learned through our initial animal studies that this targeted release of THC, which could be provided in very low doses to achieve physiologically beneficial results, serves as an anti-inflammatory agent in the lower gastrointestinal tract and minimizes the amount of THC absorbed into the blood stream, thereby avoiding the psychoactive and intoxicating properties that hinder the broader pharmaceutical use of THC.

 

We are developing our THC-glycoside prodrugs for the treatment of gastrointestinal diseases, including inflammatory bowel disease (IBD) and irritable bowel syndrome (IBS) because of the targeted release described above. IBD is a frequently chronic inflammatory condition where parts of the digestive system become inflamed from an overactive immune response. The disease can lead to irreversible damage to the gastrointestinal tract and may require surgery to remove affected areas of the intestine. Two major forms of the disease are Crohn’s disease, which can affect any part of the digestive system, and ulcerative colitis, which often affects the colon or large intestine. The disease is often unpredictable with periods of painful and debilitating symptoms followed by periods of remission with limited symptoms. IBS has similar symptoms to IBD, including abdominal pain, but the underlying disease process is quite different. IBS is a functional gastrointestinal disorder that commonly affects the large intestine and is characterized by abdominal cramping, diarrhea, constipation, and pain. Currently, patients suffering from IBD are frequently prescribed anti-inflammatory drugs such as steroids, biologics and immunosuppressants, and patients suffering from IBS are prescribed antibiotics, antidepressants and gastrointestinal motility compounds, all of which often result in unwanted side effects.

 

Our most promising THC-glycoside (VBX-100) is being developed as an oral prodrug for the treatment of IBD and IBS. VBX-100 was selected from our THC-glycoside portfolio due to its compatibility with commercial production techniques and the optimal prodrug delivery profile that maximizes intestinal anti-inflammatory properties while minimizing psychoactive or intoxicating effects. Initial pre-clinical studies on the efficacy of VBX-100 in animal models have shown favorable outcomes, including reduced inflammation of the gastrointestinal tract and no measurable systemic THC found in tissue examined using highly-sensitive testing equipment. Our pre-clinical development plan, which includes dose range finding studies, GLP toxicology studies, pharmacokinetic studies and other pre-clinical research, is anticipated to be completed during the 1st half of calendar year 2022, subject to the Company securing sufficient additional funding or entering into a strategic research and development partnership. After our satisfactory completion of all of the prerequisite pre-clinical in vitro and in vivo studies, an Investigational New Drug (IND) application would be filed with the FDA and, upon receiving FDA approval, we would initiate our Phase 1 clinical trial, subject to the Company securing sufficient additional funding or entering into the above-referenced strategic partnership.

 

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In addition to our research and development activities related to our THC-glycoside compounds, we are expanding and diversifying our research and development activities to include the potential safety, efficacy and commercialization of our patented CBD-glycoside compounds. CBD has well-known anti-anxiety, anti-inflammatory and anti-microbial properties, but unlike THC, CBD is non-psychoactive and non-intoxicating. By glycosylating CBD, we can create CBD-glucose compounds that may enable a targeted and concentrated delivery of CBD in the gastrointestinal tract. Currently we are evaluating the optimal CBD-glycoside delivery mechanism, which may include an aqueous drink formulation since our glycosylation process significantly improves the water solubility of the CBD molecule.

 

Enzymatic Processing Methods

 

The Company originally developed its proprietary enzymatic bioprocessing technologies to attach glucose molecules to the molecules of stevia as part of our activities in the stevia processing industry. We then expanded the application of this proprietary technology to attach glucose molecules to cannabinoids, including THC and CBD. We may pursue additional opportunities to develop new products or license this technology.

 

Results of Operations

 

Three Months Ended December 31, 2020 and December 31, 2019

 

Our net income during the three months ended December 31, 2020, was $692,950 compared to a net loss of $795,295 for the three months ended December 31, 2019. This change was primarily attributable to a gain from a settlement of a vendor dispute. Included in net loss during the three months ended December 31, 2019, was our loss from discontinued operations of $48,769. There was no such loss recorded in the corresponding 2020 period. We had no revenue from continuing operations during either the 2020 or 2019 period.

 

During the three months ended December 31, 2020, we incurred general and administrative expenses in the aggregate amount of $394,567 compared to $506,926 incurred during the three months ended December 31, 2019 (a decrease of $112,359). General and administrative expenses generally include corporate overhead, salaries and other compensation costs, financial and administrative contracted services, marketing, consulting costs and travel expenses. The decrease in general and administrative costs in the period is primarily attributable to a decrease in employee benefits expense of approximately $37,000, as well as a decrease in travel expenses of approximately $21,000.

 

In addition, during the three months ended December 31, 2020, we incurred research and development costs of $71,975, compared to $241,840 during the three months ended December 31, 2019 (a decrease of $169,865). This decrease resulted from a reduction in staff in the 2020 period and corresponding decrease in research and development activities.

 

During the three months ended December 31, 2020, we recorded total net other income in the amount of $1,159,492, compared to total net other income recorded during the three months ended December 31, 2019 in the amount of $2,240. During the three months ended December 31, 2020, we recorded a gain from a settlement of a vendor dispute in the amount of $1,062,405 and a gain related to the forgiveness of our PPP loan of $97,516.

 

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Nine Months Ended December 31, 2020 and December 31, 2019

 

Our net loss during the nine months ended December 31, 2020 was $520,220 compared to a net loss of $3,614,024 for the nine months ended December 31, 2019. The decrease in net loss of $3,093,804 during the 2020 period is attributable primarily to operating expenses reduced by $1,278,497, elimination of loss from discontinued operations of $714,827, gain on settlement of $1,062,405 and the gain related to the forgiveness of our PPP loan of $97,516. Included in net loss during the nine months ended December 31, 2019, was our loss from discontinued operations of $714,827. There was no loss from discontinued operations recorded in the 2020 period. We had no revenue from continuing operations during either the 2020 or 2019 period.

 

During the nine months ended December 31, 2020, we incurred general and administrative expenses in the aggregate amount of $1,342,110 compared to $2,094,026 incurred during the nine months ended December 31, 2019 (a decrease of $751,916). General and administrative expenses generally include corporate overhead, salaries and other compensation costs, financial and administrative contracted services, marketing, consulting costs and travel expenses. The majority of the decrease in general and administrative costs in the period is attributable to a decrease in legal fees, most of which were incurred in connection with the Private Investigation and Section 8(e) Examination, which decreased by approximately $500,000 from the previous nine-month period, as well as a decrease in wages of approximately $152,000 from the previous nine-month period.

 

In addition, during the nine months ended December 31, 2020, we incurred research and development costs of $338,268, compared to $864,849 during the nine months ended December 31, 2019 (a decrease of $526,581). This decrease resulted from a reduction in staff during the 2020 period and corresponding decrease in research and development activities.

 

Our discontinued operations incurred a loss of $714,827 during the nine months ended December 31, 2019. No loss from discontinued operations was incurred during the nine months ended December 31, 2020.

 

During the nine months ended December 31, 2020, we recorded total net other income in the amount of $1,160,158 compared to total net other income recorded during the nine months ended December 31, 2019 in the amount of $59,678. During the nine months ended December 31, 2020, we recorded a gain from a settlement of a vendor dispute in the amount of $1,062,405 and a gain related to the forgiveness of our PPP loan of $97,516.

 

Liquidity and Capital Resources

 

We have incurred losses since inception resulting in an accumulated deficit of $47,067,078 as of December 31, 2020, and further losses are anticipated in the development of our business.

 

As of December 31, 2020, we had total current assets of $1,454,666, comprised primarily of cash in the amount of $1,441,471. Our total current liabilities as of December 31, 2020 were $391,925, represented primarily by accounts payable and accrued liabilities of $72,078 and an advance of $296,653. As a result, on December 31, 2020, we had working capital of $1,062,741.

 

On November 7, 2018, the SEC suspended the trading of our common stock. Our common stock resumed trading with limited liquidity on the grey market on November 21, 2018. Grey market stocks are not traded or quoted on an exchange or inter-dealer quotation system, but are reported by broker-dealers to their self-regulatory organization (“SRO”) and the SRO distributes the trade data to market data vendors and financial websites. Since grey market securities are not traded or quoted on an exchange or inter-dealer quotation system, investor’s bids and offers are not collected in a central spot, so market transparency is diminished and execution of orders is difficult. We are actively pursuing the resumption of ordinary course trading status on the OTCQB or a national exchange.

 

In September 2020, we retained DelMorgan & Co., an internationally recognized investment banking firm, to advise us on our strategic alternatives, including potential financings, asset divestitures or strategic partnerships. The Company is continuing to work closely with DelMorgan in support of their retention.

 

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While we believe that our existing cash balances will be sufficient to fund our currently planned level of operations, we may require additional financing to fund our planned future operations. We do not have any firm commitments for future capital and until the Company resumes ordinary course trading status on the OTCQB or a national exchange it will be difficult to obtain financing on commercially reasonable or acceptable terms. We do not presently have, nor do we expect in the near future to have, material revenue to fund our business from our operations, and we will need to obtain all of our necessary funding from external sources in the near term. Additional financing may be required to fund our planned operations in future periods, including research and development activities relating to our principal product candidate, seeking regulatory approval of that or any other product candidate we may choose to develop, commercializing any product candidate for which we are able to obtain regulatory approval or certification, seeking to license or acquire new assets or businesses, and maintaining our intellectual property rights and pursuing rights to new technologies. We may seek to raise such funding from a variety of sources. If we raise additional funds by issuing equity or convertible debt securities, our existing stockholders’ ownership will be diluted, and obtaining commercial loans would increase our liabilities and future cash commitments. If we pursue capital through alternative sources, such as collaborations or other similar arrangements, we may be forced to relinquish rights to our proprietary technology or other intellectual property that could result in our receipt of only a portion of any revenue that may be generated from a partnered product or business. Further, we may not be able to obtain additional financing from any of these sources on commercially reasonable or acceptable terms when needed, or at all. If we cannot raise the money that we need in order to continue to operate and develop our business, we will be forced to delay, scale back or eliminate some or all of our operations. If any of these were to occur, there is a substantial risk that our business would fail and our stockholders could lose all of their investment.

 

Net Cash Used in Operating Activities

 

We have not generated positive cash flows from operating activities. For the nine months ended December 31, 2020, net cash used in operating activities-continuing operations was $1,047,742 compared to net cash used in operating activities-continuing operations of $2,144,458 for the nine months ended December 31, 2019. Net cash used in operating activities-continuing operations during the nine months ended December 31, 2020 consisted primarily of a net loss of $520,220, and a decrease in accounts payable of $178,045 offset by $349,546 related to stock-based compensation and gain on settlement of $612,405 net of the cash received. Net cash used in operating activities-continuing operations during the nine months ended December 31, 2019 consisted primarily of a net loss of $3,614,024, offset by $492,554 related to stock-based compensation and an increase in accounts payable of $292,521. For the nine months ended December 30, 2019, net cash used in operating activities-discontinued operations was $714,883. No cash was used in operating activities-discontinued operations for the nine months ended December 31, 2020. The losses incurred in the 2019 period were attributed to the losses incurred by the Company’s clinical operations.

 

Net Cash Used in Investing Activities

 

During the nine months ended December 31, 2020 and December 31, 2019, no net cash was used in or provided by investing activities.

 

Net Cash Provided By Financing Activities

 

During the nine months ended December 31, 2020, net cash provided from financing activities was $96,988 from the issuance of a note payable. During the nine months ended December 31, 2019, no net cash was used in or provided by financing activities.

 

Off-Balance Sheet Arrangements

 

We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that would be material to stockholders.

 

Critical Accounting Policies

 

Our financial statements and accompanying notes included in this report have been prepared in accordance with United States generally accepted accounting principles (“U.S. GAAP”) applied on a consistent basis. The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods.

 

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We regularly evaluate the accounting policies and estimates that we use to prepare our financial statements. In general, management’s estimates are based on historical experience, on information from third party professionals, and on various other assumptions that are believed to be reasonable under the facts and circumstances. Actual results could differ from the estimates made by management.

 

We believe the following critical accounting policies require us to make significant judgments and estimates in the preparation of our consolidated financial statements included in this report:

 

Use of Estimates and Assumptions

 

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the period. Actual results could differ from those estimates. The more significant estimates and assumption by management include, among others, the fair value of shares issued for services, the fair value of options and warrants, and assumptions used in the valuation of our outstanding derivative liabilities.

 

Share-Based Payments

 

The Company periodically issues stock options, warrants, and shares of common stock as share-based compensation to employees and non-employees in non-capital raising transactions for services and for financing costs. The Company accounts for such grants issued and vesting based on FASB ASC 718, Compensation – Stock Compensation (Topic 718) whereby the value of the award is measured on the date of grant and recognized as compensation expense on the straight-line basis over the vesting period. The Company recognizes the fair value of stock-based compensation within its Statements of Operations with classification depending on the nature of the services rendered.

 

The fair value of the Company’s stock options and warrants are estimated using the Black-Scholes-Merton Option Pricing model, which uses certain assumptions related to risk-free interest rates, expected volatility, expected life of the stock options or restricted stock, and future dividends. Compensation expense is recorded based upon the value derived from the Black-Scholes-Merton Option Pricing model and based on actual experience. The assumptions used in the Black-Scholes-Merton Option Pricing model could materially affect compensation expense recorded in future periods.

 

Recent Accounting Pronouncements

 

Please refer to Footnote 1 of the accompanying financial statements for management’s discussion of recent accounting pronouncements.

 

Item 3. Quantitative and Qualitative Disclosures About Market Risk

 

Not Applicable.

 

Item 4. Controls and Procedures

 

Disclosure Controls and Procedures

 

We have established disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC, and that information relating to the Company is accumulated and communicated to management, including our principal officers, as appropriate to allow timely decisions regarding required disclosure. Our Chief Executive Officer and Chief Financial Officer have evaluated the effectiveness of our disclosure controls and procedures as of December 31, 2020, and have concluded that our disclosure controls and procedures were effective as of December 31, 2020.

 

Changes in Internal Control over Financial Reporting

 

There were no changes in our internal control over financial reporting during the quarter ended December 31, 2020 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

 

20

 

 

PART II - OTHER INFORMATION

 

Item 1. Legal Proceedings

 

From time to time, we may become involved in various lawsuits and legal proceedings which arise in the ordinary course of business. The impact and outcome of litigation, if any, is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm our business. We are not currently a party to and our properties are not currently the subject of any material pending legal proceedings the adverse outcome of which, individually or in the aggregate, would be expected to have a material adverse effect on our financial position or results of operations.

 

Item 1A. Risk Factors

 

Please refer to the risks described under the heading “Risk Factors” in our Annual Report on Form 10-K filed with the SEC on June 29, 2020.

 

COVID-19 Considerations

 

The global outbreak of COVID-19 has led to significant disruptions in the global economy, including the curtailment of activities by businesses and consumers in much of the world as governments and others seek to limit the spread of the disease. The extent of the impact of the pandemic on our business and financial results will depend largely on future developments, including the duration and severity of the outbreak, the length of restrictions and business closures imposed by domestic and foreign governments, the impact on capital and financial markets, all of which are highly uncertain and cannot be predicted. In the quarter ended December 31, 2020, the COVID-19 pandemic did not have a material net impact on our operating results. We have also not observed any material impairments of our assets or a significant change in the fair value of our assets due to the COVID-19 pandemic. While it is not possible at this time to estimate the full impact that COVID-19 will have on our business, restrictions resulting from COVID-19 on general economic conditions could, among other things, impair our ability to raise capital when needed. This situation is changing rapidly, and additional impacts may arise that we are not aware of currently.

 

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

 

None.

 

21

 

 

Item 6. Exhibits

 

Exhibit

Number

  Description of Exhibit
     
3.1.1   Articles of Incorporation of Stevia First Corp. (Incorporated by reference to Exhibit 3.1 to the registrant’s Registration Statement on Form S-1 filed with the SEC on August 6, 2008 (File No. 333-152830).)
     
3.1.2   Articles of Merger, effective October 10, 2011 (Incorporated by reference to Exhibit 3.1 to the registrant’s Current Report on Form 8-K filed with the SEC on October 14, 2011.)
     
3.1.3   Certificate of Change, effective October 10, 2011 (Incorporated by reference to Exhibit 3.2 to the registrant’s Current Report on Form 8-K filed with the SEC on October 14, 2011.)
     
3.2.1   Bylaws of Stevia First Corp. (Incorporated by reference to Exhibit 3.2 to the registrant’s Registration Statement on Form S-1 filed with the SEC on August 6, 2008 (File No. 333-152830).)
     
3.2.2   Certificate of Amendment of Bylaws of Stevia First Corp. (Incorporated by reference to Exhibit 3.1 to the registrant’s Current Report on Form 8-K filed with the SEC on February 7, 2012.)
     
31.1   Certification of Chief Executive Officer Pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934*
     
31.2   Certification of Chief Financial Officer Pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934*
     
32.1   Certification of Chief Executive Officer Pursuant to Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002†
     
32.2   Certification of Chief Financial Officer Pursuant to Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002†
     
101.INS   XBRL Instance Document *
     
101.SCH   XBRL Taxonomy Extension Schema Document *
     
101.CAL   XBRL Taxonomy Extension Calculation Linkbase *
     
101.DEF   XBRL Taxonomy Extension Definition Linkbase Document *
     
101.LAB   XBRL Taxonomy Extension Label Linkbase Document *
     
101.PRE   XBRL Taxonomy Extension Presentation Linkbase Document *

 

† Furnished herewith.

 

22

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

VITALITY BIOPHARMA, INC.  
   
By: /s/ Michael Cavanaugh  
  Michael Cavanaugh  
  Chief Executive Officer  
  (Principal Executive Officer)  

     
Date: January 29, 2021  

 

23
 

 

EXHIBIT INDEX

 

Exhibit

Number

  Description of Exhibit
     
3.1.1   Articles of Incorporation of Stevia First Corp. (Incorporated by reference to Exhibit 3.1 to the registrant’s Registration Statement on Form S-1 filed with the SEC on August 6, 2008 (File No. 333-152830).)
     
3.1.2   Articles of Merger, effective October 10, 2011 (Incorporated by reference to Exhibit 3.1 to the registrant’s Current Report on Form 8-K filed with the SEC on October 14, 2011.)
     
3.1.3   Certificate of Change, effective October 10, 2011 (Incorporated by reference to Exhibit 3.2 to the registrant’s Current Report on Form 8-K filed with the SEC on October 14, 2011.)
     
3.2.1   Bylaws of Stevia First Corp. (Incorporated by reference to Exhibit 3.2 to the registrant’s Registration Statement on Form S-1 filed with the SEC on August 6, 2008 (File No. 333-152830).)
     
3.2.2   Certificate of Amendment of Bylaws of Stevia First Corp. (Incorporated by reference to Exhibit 3.1 to the registrant’s Current Report on Form 8-K filed with the SEC on February 7, 2012.)
     
31.1   Certification of Chief Executive Officer Pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934*
     
31.2   Certification of Chief Financial Officer Pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934*
     
32.1   Certification of Chief Executive Officer Pursuant to Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002†
     
32.2   Certification of Chief Financial Officer Pursuant to Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002†
     
101.INS   XBRL Instance Document *
     
101.SCH   XBRL Taxonomy Extension Schema Document *
     
101.CAL   XBRL Taxonomy Extension Calculation Linkbase *
     
101.DEF   XBRL Taxonomy Extension Definition Linkbase Document *
     
101.LAB   XBRL Taxonomy Extension Label Linkbase Document *
     
101.PRE   XBRL Taxonomy Extension Presentation Linkbase Document *

 

† Furnished herewith.

 

 
EX-31.1 2 ex31-1.htm

 

Exhibit 31.1

 

CERTIFICATION

 

I, Michael Cavanaugh, certify that:

 

  1. I have reviewed this report on Form 10-Q for the quarterly period ended December 31, 2020 of Vitality Biopharma, Inc.;
     
  2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
     
  3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
     
  4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

  (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
     
  (b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
     
  (c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
     
  (d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

  5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of the internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

 

  (a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
     
  (b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

Date: January 29, 2021

 

Name: /s/ Michael Cavanaugh  
By: Michael Cavanaugh  
Title: Chief Executive Officer  
  (Principal Executive Officer)  

 

 
EX-31.2 3 ex31-2.htm

 

Exhibit 31.2

 

CERTIFICATION

 

I, Richard McKilligan, certify that:

 

  1. I have reviewed this report on Form 10-Q for the quarterly period ended December 31, 2020 of Vitality Biopharma, Inc.;
     
  2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
     
  3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
     
  4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

  (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
     
  (b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
     
  (c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
     
  (d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

  5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of the internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

 

  (a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
     
  (b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

Date: January 29, 2021

 

Name: /s/ Richard McKilligan  
By: Richard McKilligan  
Title: Chief Financial Officer  
  (Principal Accounting Officer)  

 

 
EX-32.1 4 ex32-1.htm

 

Exhibit 32.1

 

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

 

PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

The undersigned, Michael Cavanaugh, the Chief Executive Officer of Vitality Biopharma, Inc. (the “Company”), hereby certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to his knowledge, the Quarterly Report on Form 10-Q for the period ended December 31, 2020, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and that the information contained in the Quarterly Report on Form 10-Q fairly presents in all material respects the financial condition and results of operations of the Company as of the dates and for the periods presented in the financial statements included in such report.

 

/s/ Michael Cavanaugh  
Michael Cavanaugh  
Chief Executive Officer  
(Principal Executive Officer)  

 

Date: January 29, 2021

 

This certification accompanies this Quarterly Report on Form 10-Q pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not be deemed filed by the Company for purposes of Section 18 of the Exchange Act. Such certification will not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except to the extent that the Company specifically incorporates it by reference.

 

 
EX-32.2 5 ex32-2.htm

 

Exhibit 32.2

 

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

 

PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

The undersigned, Richard McKilligan, the Chief Financial Officer of Vitality Biopharma, Inc. (the “Company”), hereby certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to his knowledge, the Quarterly Report on Form 10-Q for the period ended December 31, 2020, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and that the information contained in the Quarterly Report on Form 10-Q fairly presents in all material respects the financial condition and results of operations of the Company as of the dates and for the periods presented in the financial statements included in such report.

 

/s/ Richard McKilligan  
Richard McKilligan  
Chief Financial Officer  
(Principal Financial and Accounting Officer)  

 

Date: January 29, 2021

 

This certification accompanies this Quarterly Report on Form 10-Q pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not be deemed filed by the Company for purposes of Section 18 of the Exchange Act. Such certification will not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except to the extent that the Company specifically incorporates it by reference.

 

 

 

 

 

 

 

 

 

 

 

 

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Net decrease in cash (950,754) (2,859,341)
Cash and cash equivalents - beginning of period 2,392,225 5,982,741
Cash and cash equivalent - end of period 1,441,471 3,123,400
Supplemental disclosure of cash flow information:    
Cash paid during the period for: Interest
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Business Operations and Summary of Significant Accounting Policies

1. BUSINESS OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Vitality Biopharma, Inc. (the “Company”, “we”, “us” or “our”), was incorporated in the State of Nevada on June 29, 2007. The Company’s fiscal year end is March 31.

 

The Company is engaged in the research and development of cannabinoid prodrug pharmaceuticals, which we refer to as cannabosides. We discovered these cannabosides through application of the Company’s proprietary enzymatic bioprocessing technologies. In 2016, the Company received approvals from the U.S. Drug Enforcement Administration (the “DEA”) and the State of California to initiate studies and manufacturing scale-up at its research and development facilities in order to develop cannabosides.

 

Liquidity

 

Since we do not have any commercial products currently available in the marketplace, the Company does not generate any revenues. As reflected in the accompanying financial statements, during the nine months ended December 31, 2020, the Company incurred a net loss of $520,220 and used $1,047,742 of cash in our operating activities. As of December 31, 2020, we had $1,441,471 of cash on hand, stockholders’ equity of $1,111,715 and had working capital of $1,062,741.

 

Our total expenditures for the twelve months following December 31, 2020, are expected to be approximately $1,000,000, which is comprised of research and development and general operating expenses. Based on the funds we had available on December 31, 2020, we believe that we have sufficient capital to fund our anticipated operating expenses for at least one year from the date that the financial statements in this report are issued.

 

On November 7, 2018, the SEC suspended the trading of our common stock. Our common stock resumed trading with limited liquidity on the grey market on November 21, 2018. Grey market stocks are not traded or quoted on an exchange or inter-dealer quotation system, but are reported by broker-dealers to their self-regulatory organization (“SRO”) and the SRO distributes the trade data to market data vendors and financial websites. Since grey market securities are not traded or quoted on an exchange or inter-dealer quotation system, investor’s bids and offers are not collected in a central spot, so market transparency is diminished and execution of orders is difficult. We are actively pursuing the resumption of ordinary course trading status on the OTCQB.

 

In September 2020, we retained DelMorgan & Co., an internationally recognized investment banking firm, to advise us on our strategic alternatives, including potential financings, asset divestitures or strategic partnerships. The Company is continuing to work closely with DelMorgan in support of their retention.

 

While we believe that our existing cash balances will be sufficient to fund our currently planned level of operations, we may require additional financing to fund our planned future operations. We do not have any firm commitments for future capital and until the Company’s securities resume ordinary course trading on the OTCQB (or are listed on a national exchange) it will be difficult to obtain financing on commercially reasonable or acceptable terms. We do not presently have, nor do we expect in the near future to have, material revenue to fund our business from our operations, and we will need to obtain all of our necessary funding from external sources in the near term. Additional financing may be required to fund our planned operations in future periods, including research and development activities relating to our principal product candidate, seeking regulatory approval of that or any other product candidate we may choose to develop, commercializing any product candidate for which we are able to obtain regulatory approval or certification, seeking to license or acquire new assets or businesses, and maintaining our intellectual property rights and pursuing rights to new technologies. We may seek to raise such funding from a variety of sources. If we raise additional funds by issuing equity or convertible debt securities, our existing stockholders’ ownership may be diluted, and obtaining commercial loans would increase our liabilities and future cash commitments. If we pursue capital through alternative sources, such as collaborations or other similar arrangements, we may be forced to relinquish rights to our proprietary technology or other intellectual property that could result in our receipt of only a portion of any revenue that may be generated from a partnered product or business. Further, we may not be able to obtain additional financing from any of these sources on commercially reasonable or acceptable terms when needed, or at all. If we cannot raise the money that we need in order to continue to operate and develop our business, we will be forced to delay, scale back or eliminate some or all of our operations. If any of these were to occur, there is a substantial risk that our business would fail and our stockholders could lose all of their investment.

 

Further, these estimates could differ if we encounter unanticipated difficulties, or if our estimates of the amount of cash necessary to operate our business prove to be wrong, and we use our available financial resources faster than we currently expect.

 

COVID-19 Considerations

 

The global outbreak of COVID-19 has led to significant disruptions in the global economy, including the curtailment of activities by businesses and consumers in much of the world as governments and others seek to limit the spread of the disease. The extent of the impact of the pandemic on our business and financial results will depend largely on future developments, including the duration and severity of the outbreak, the length of restrictions and business closures imposed by domestic and foreign governments, the impact on capital and financial markets, all of which are highly uncertain and cannot be predicted. In the quarter ended December 31, 2020, the COVID-19 pandemic did not have a material net impact on our operating results. We have also not observed any material impairments of our assets or a significant change in the fair value of our assets due to the COVID-19 pandemic. While it is not possible at this time to estimate the full impact that COVID-19 will have on our business, restrictions resulting from COVID-19 on general economic conditions could, among other things, impair our ability to raise capital when needed. This situation is changing rapidly, and additional impacts may arise that we are not aware of currently.

 

Basis of Presentation of Unaudited Condensed Financial Information

 

The unaudited condensed financial statements of the Company for the three and nine months ended December 31, 2020 and 2019 have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information, applied on a consistent basis, and pursuant to the requirements for reporting on Form 10-Q and the requirements of Regulation S-K and Regulation S-X promulgated under the Securities Act of 1933, as amended (the “Securities Act”). Accordingly, they do not include all the information and footnotes required by U.S. GAAP for complete audited financial statements. However, the information included in these financial statements reflects all adjustments (consisting solely of normal recurring adjustments), which are, in the opinion of management, necessary for the fair presentation of the Company’s financial position and the results of operations. Results shown for interim periods are not necessarily indicative of the results to be obtained for a full fiscal year or any future annual or interim period. The balance sheet information as of March 31, 2020 was derived from the Company’s audited financial statements as of and for the year ended March 31, 2020 included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (the “SEC”) on June 29, 2020. These financial statements should be read in conjunction with that report.

 

Estimates

 

The preparation of financial statements in conformity with generally accepted accounting principles in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the period. Actual results could differ from those estimates. Significant estimates and assumptions by management include, among others, the fair value of equity instruments issued for services, and assumptions used in the valuation of derivative liabilities and the valuation allowance for deferred tax assets, and the accrual of potential liabilities.

 

Financial Assets and Liabilities Measured at Fair Value

 

The Company uses various inputs in determining the fair value of its investments and measures these assets on a recurring basis. Financial assets recorded at fair value in the balance sheets are categorized by the level of objectivity associated with the inputs used to measure their fair value. Authoritative guidance provided by FASB defines the following levels directly related to the amount of subjectivity associated with the inputs:

 

Level 1   Quoted prices in active markets for identical assets or liabilities.
     
Level 2   Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly.
     
Level 3   Unobservable inputs based on the Company’s assumptions.

 

The carrying amounts of financial assets and liabilities, such as cash and cash equivalents, accounts payable, notes payable and advance, approximate their fair values because of the short maturity of these instruments.

 

Derivative Financial Instruments

 

The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported in the statements of operations. For stock-based derivative financial instruments, the Company uses a probability weighted average Black-Scholes-Merton model to value the derivative instruments at inception and on subsequent valuation dates. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period.

 

Share-Based Payments

 

The Company periodically issues stock options, warrants, and shares of common stock as share-based compensation to employees and non-employees in non-capital raising transactions for services and for financing costs. The Company accounts for such grants issued and vesting based on FASB ASC 718, Compensation – Stock Compensation (Topic 718) whereby the value of the award is measured on the date of grant and recognized as compensation expense on the straight-line basis over the vesting period. The Company recognizes the fair value of stock-based compensation within its Statements of Operations with classification depending on the nature of the services rendered.

 

The fair value of the Company’s stock options and warrants are estimated using the Black-Scholes-Merton Option Pricing model which uses certain assumptions related to risk-free interest rates, expected volatility, expected life of the stock options or restricted stock, and future dividends. Compensation expense is recorded based upon the value derived from the Black-Scholes-Merton Option Pricing model and based on actual experience. The assumptions used in the Black-Scholes-Merton Option Pricing model could materially affect compensation expense recorded in future periods.

 

Basic and Diluted Loss Per Share

 

Basic loss per share is computed by dividing the net loss applicable to common stockholders by the weighted average number of outstanding common shares during the period. Diluted loss per share is computed by dividing net loss applicable to common stockholders by the weighted average number of common shares outstanding plus the number of additional common shares that would have been outstanding if all dilutive potential common shares had been issued. Diluted loss per share excludes all potential common shares if their effect is anti-dilutive. The following potentially dilutive shares were excluded from the shares used to calculate diluted earnings per share as their inclusion would be anti-dilutive:

 

    Nine months ended  
    December 31, 2020     December 31, 2019  
Options     5,997,544       6,546,710  
Warrants     146,668       1,135,003  
Total     6,144,212       7,681,713  

 

Research and Development

 

Research and development costs consist primarily of fees paid to consultants and outside service providers, patent fees and costs, and other expenses relating to the acquisition, design, development and testing of the Company’s product candidates. Research and development costs are expensed as incurred.

 

Recent Accounting Pronouncements

 

In June 2016, the FASB issued ASU No. 2016-13, Credit Losses - Measurement of Credit Losses on Financial Instruments (“ASC 326”). ASU 2016-13 requires entities to use a forward-looking approach based on current expected credit losses (“CECL”) to estimate credit losses on certain types of financial instruments, including trade receivables. This may result in the earlier recognition of allowances for losses. ASU 2016-13 is effective for the Company beginning April 1, 2023, and early adoption is permitted. The Company does not believe the potential impact of the new guidance and related codification improvements will be material to its financial position, results of operations and cash flows.

 

In August 2020, the FASB issued ASU No. 2020-06 (“ASU 2020-06”) Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. ASU 2020-06 will simplify the accounting for convertible instruments by reducing the number of accounting models for convertible debt instruments and convertible preferred stock. Limiting the accounting models will result in fewer embedded conversion features being separately recognized from the host contract as compared with current GAAP. Convertible instruments that continue to be subject to separation models are (1) those with embedded conversion features that are not clearly and closely related to the host contract, that meet the definition of a derivative, and that do not qualify for a scope exception from derivative accounting and (2) convertible debt instruments issued with substantial premiums for which the premiums are recorded as paid-in capital. ASU 2020-06 also amends the guidance for the derivatives scope exception for contracts in an entity’s own equity to reduce form-over-substance-based accounting conclusions. ASU 2020-06 will be effective January 1, 2024, for the Company. Early adoption is permitted, but no earlier than January 1, 2021, including interim periods within that year. Management is currently evaluating the effect of the adoption of ASU 2020-06 on the consolidated financial statements, but currently does not believe ASU 2020-06 will have a significant impact on the Company’s accounting for its convertible debt instruments. The effect will largely depend on the composition and terms of the financial instruments at the time of adoption.

 

Other recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company’s present or future financial statements.

XML 20 R9.htm IDEA: XBRL DOCUMENT v3.20.4
Operating Lease
9 Months Ended
Dec. 31, 2020
Leases [Abstract]  
Operating Lease

2. OPERATING LEASE

 

At December 31, 2020, the Company’s wholly-owned subsidiary, The Control Center, Inc., (“TCC”) has an operating lease agreement for office space that began in December 2012, and was amended in December 2015 and December 2019, and expires February 28, 2021. In addition, at December 31, 2020, TCC has a sublease agreement in place for the office space that began in September 2019 and expires February 28, 2021. TCC remains the primary obligor on the office space lease agreement. Sublease income was not significant during the three and nine months ended December 31, 2020 and 2019.

 

Leases with an initial term of 12 months or less are not recorded on the balance sheet. The Company accounts for the lease and non-lease components of its lease as a single lease component. Lease expense is recognized on a straight-line basis over the lease term. An operating lease right-of-use (“ROU”) asset and liability is recognized at commencement date based on the present value of lease payments over the lease term. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Generally, the implicit rate of interest in arrangements is not readily determinable and the Company utilizes its incremental borrowing rate in determining the present value of lease payments.

 

The components of lease expense and supplemental cash flow information related to leases for the period are as follows: 

   

Nine Months

Ended

December 31, 2020

 
Lease Cost        
Operating lease cost (included in general and administrative expenses in the Company’s unaudited condensed consolidated statement of operations)   $ 111,657  
         
Other Information        
Cash paid for amounts included in the measurement of lease liabilities for the three months ended December 31, 2020   $ -  
Weighted average remaining lease term – operating leases (in years)     0.2  
Average discount rate – operating leases     4.0 %

 

The supplemental balance sheet information related to leases for the period is as follows:

 

    At December 31, 2020  
Operating leases        
Long-term right-of-use asset   $ 22,817  
         
Short-term operating lease liability   $ 23,194  
Total operating lease liabilities   $ 23,194  

 

Maturities of the Company’s lease liabilities are as follows (in thousands):

 

Year Ending March 31   Operating Lease  
2021 (remaining 2 months)   $ 23,310  
Total lease payments     23,310  
Less: Imputed interest/present value discount     (116 )
Present value of lease liabilities   $ 23,194  

 

Lease expenses were $45,970 and $139,218 during the three and nine months ended December 31, 2020, respectively.

XML 21 R10.htm IDEA: XBRL DOCUMENT v3.20.4
Gain on Extinguishment of Note Payable
9 Months Ended
Dec. 31, 2020
Debt Disclosure [Abstract]  
Gain On Extinguishment of Note Payable

3. GAIN ON EXTINGUISHMENT OF NOTE PAYABLE

 

On May 6, 2020, the Company was granted a loan (the “PPP” loan) from U.S. Bank for $96,988 pursuant to the Paycheck Protection Program under the CARES Act. The PPP loan bore interest at 1% per annum with the first six months of interest deferred, and was unsecured and guaranteed by the Small Business Administration (the “SBA”). The Company used the entire PPP loan amount for qualifying expenses as described in the CARES Act, including qualifying payroll costs, qualifying group health care benefits, qualifying rent, and qualifying utilities. On November 21, 2020, we received notice that the SBA had reviewed the forgiveness application of our PPP loan and provided forgiveness of our PPP loan of $97,516, including accrued interest of $528. We recognized a gain on extinguishment of the PPP loan of $97,516 during the three and nine months ended December 31, 2020.

XML 22 R11.htm IDEA: XBRL DOCUMENT v3.20.4
Gain on Settlement
9 Months Ended
Dec. 31, 2020
Debt Disclosure [Abstract]  
Gain On Settlement

4. GAIN ON SETTLEMENT

 

From 2016 to 2019, the Company recorded approximately $1.1 million due to a vendor for services, of which $612,405 had not been paid and was included in accounts payable at March 31, 2020 and through November 30, 2020.  In December 2020, the Company reached a settlement with the vendor to forgive the $612,405 of outstanding invoices, and in addition, the Company received a payment from the vendor of $450,000.  This resulted in a gain on settlement of $1,062,405 during the three and nine months ended December 31, 2020.

XML 23 R12.htm IDEA: XBRL DOCUMENT v3.20.4
Advance
9 Months Ended
Dec. 31, 2020
Receivables [Abstract]  
Advance

5. ADVANCE

 

In July 2018, we received a payment from a third party in the amount of $250,000 and a payment of $46,653 was made on our behalf to a vendor. To date, the Company has not confirmed the nature of these payments. We have recorded these payments as an advance and at December 31, 2020 and March 31, 2020, it is included in current liabilities on the accompanying financial statements.

XML 24 R13.htm IDEA: XBRL DOCUMENT v3.20.4
Stock Options
9 Months Ended
Dec. 31, 2020
Share-based Payment Arrangement [Abstract]  
Stock Options

6. STOCK OPTIONS

 

A summary of the Company’s stock option activity during the nine months ended December 31, 2020 is as follows:

 

    Shares    

Weighted

Average

Exercise Price

 
Balance outstanding at March 31, 2020     6,556,710     $ 0.89  
Granted     -          
Exercised     -          
Expired     (32,500 )     2.17  
Cancelled     (526,666 )     1.42  
Balance outstanding at December 31, 2020     5,997,544     $ 0.91  
Balance exercisable at December 31, 2020     4,622,544     $ 0.87  

 

A summary of the Company’s stock options outstanding and exercisable as of December 31, 2020 is as follows:

 

    Number of Options     Weighted Average Exercise Price     Weighted Average Grant- date Stock Price  
Options Outstanding, December 31, 2020     750,000     $ 0.30     $ 0.30  
      2,000,000     $ 0.35     $ 0.35  
      1,664,542     $ 0.50     $ 0.50  
      128,000     $ 0.96     $ 0.96  
      130,000     $ 1.00     $ 10.00  
      500,834       $ 1.50 - 1.95       $ 1.50 - 1.95  
      657,500       $ 2.00 - 2.79       $ 2.00 - 2.79  
      123,334       $ 3.10 - 3.80       $ 3.10 - 3.80  
      43,334       $ 4.00 - 4.70       $ 4.00 - 4.70  
      5,997,544                  
Options Exercisable, December 31, 2020     375,000     $ 0.30     $ 0.30  
      1,000,000     $ 0.35     $ 0.35  
      1,664,542     $ 0.50     $ 0.50  
      128,000     $ 0.96     $ 0.96  
      130,000     $ 1.00     $ 10.00  
      500,834       $ 1.50 - 1.95       $ $ 1.50 - 1.95  
      657,500       $ 2.00 - 2.79       $ 2.00 - 2.79  
      123,334       $ 3.10 - 3.80       $ 3.10 - 3.80  
      43,334       $ 4.00 - 4.70       $ 4.00 - 4.70  
      4,622,544                  

 

During the nine months ended December 31, 2020, we expensed total stock-based compensation related to stock options of $349,546, and the remaining unamortized cost of the outstanding stock-based awards at December 31, 2020 was approximately $160,000. The remaining unamortized cost will be amortized on a straight-line basis over a weighted average remaining vesting period of one year. At December 31, 2020, the 5,997,044 outstanding stock options had no intrinsic value.

XML 25 R14.htm IDEA: XBRL DOCUMENT v3.20.4
Warrants
9 Months Ended
Dec. 31, 2020
Warrants and Rights Note Disclosure [Abstract]  
Warrants

7. WARRANTS

 

A summary of warrants to purchase the Company’s common stock during the nine months ended December 31, 2020 is as follows:

 

    Shares    

Weighted

Average

Exercise Price

 
Balance outstanding at March 31, 2020     1,135,003     $ 2.19  
Granted     -       -  
Exercised     -       -  
Expired     (988,335 )     2.10  
Balance outstanding and exercisable at December 31, 2020     146,668     $ 3.00  

 

At December 31, 2020, the 146,668 outstanding stock warrants had no intrinsic value.

XML 26 R15.htm IDEA: XBRL DOCUMENT v3.20.4
Discontinued Operations
9 Months Ended
Dec. 31, 2020
Discontinued Operations and Disposal Groups [Abstract]  
Discontinued Operations

8. DISCONTINUED OPERATIONS

 

In October 2018, the Company acquired Summit Healthtech, Inc. (renamed Vitality Healthtech, Inc.), a specialty healthcare clinic. In addition to Summit Healthcare, the Company sold research diagnostic testing kits (collectively, the Company’s clinical and test kit operations). In May 2019 the Company decided to close its clinical and test kit operations. The clinical and test kit operations meet the discontinued operations criteria and are reported as such in all periods presented on the accompanying condensed consolidated financial statements.

 

The following table presents the summarized components of loss from discontinued operations for the clinical and test kit operations:

 

    Three Months Ended December 31,  
    2020     2019  
             
Revenue   $ -     $ -  
                 
Cost of sales     -       -  
Research and development     -       -  
General and administrative     -       48,769  
Loss from discontinued operations   $ -     $ (48,769 )

 

    Nine Months Ended December 31,  
    2020     2019  
             
Revenue   $ -     $ 44,698  
                 
Cost of sales     -       143,232  
Research and development     -       4,361  
General and administrative     -       611,932  
Loss from discontinued operations   $ -     $ (714,827 )
XML 27 R16.htm IDEA: XBRL DOCUMENT v3.20.4
Commitments and Contingencies
9 Months Ended
Dec. 31, 2020
Commitments and Contingencies Disclosure [Abstract]  
Commitments and Contingencies

9. COMMITMENTS AND CONTINGENCIES

 

SEC Investigation

 

On August 19, 2016, we filed a resale registration statement on Form S-1 (“Form S-1”) with the SEC to register 2,650,000 shares of our common stock and 7,950,000 shares of our common stock issuable upon exercise of certain warrants. We received a letter from the Washington D.C. office of the SEC dated December 10, 2016, stating that the staff of the SEC was conducting a Section 8(e) examination with respect to this Form S-1 and that the Division of Corporate Finance would not take any further action on the Form S-1 while the examination was pending. On May 12, 2020, our outside legal counsel received a letter from the staff of the SEC’s Enforcement Division stating that it has concluded the investigation as to the Company, and that it did not intend to recommend an enforcement action by the SEC against the Company. While certain former officers and directors may request the Company to reimburse them for legal fees related to this matter, at December 31, 2020, management has determined that the Company’s liability for those fees is not probable and we could not reasonably estimate those fees.

XML 28 R17.htm IDEA: XBRL DOCUMENT v3.20.4
Business Operations and Summary of Significant Accounting Policies (Policies)
9 Months Ended
Dec. 31, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Liquidity

Liquidity

 

Since we do not have any commercial products currently available in the marketplace, the Company does not generate any revenues. As reflected in the accompanying financial statements, during the nine months ended December 31, 2020, the Company incurred a net loss of $520,220 and used $1,047,742 of cash in our operating activities. As of December 31, 2020, we had $1,441,471 of cash on hand, stockholders’ equity of $1,111,715 and had working capital of $1,062,741.

 

Our total expenditures for the twelve months following December 31, 2020, are expected to be approximately $1,000,000, which is comprised of research and development and general operating expenses. Based on the funds we had available on December 31, 2020, we believe that we have sufficient capital to fund our anticipated operating expenses for at least one year from the date that the financial statements in this report are issued.

 

On November 7, 2018, the SEC suspended the trading of our common stock. Our common stock resumed trading with limited liquidity on the grey market on November 21, 2018. Grey market stocks are not traded or quoted on an exchange or inter-dealer quotation system, but are reported by broker-dealers to their self-regulatory organization (“SRO”) and the SRO distributes the trade data to market data vendors and financial websites. Since grey market securities are not traded or quoted on an exchange or inter-dealer quotation system, investor’s bids and offers are not collected in a central spot, so market transparency is diminished and execution of orders is difficult. We are actively pursuing the resumption of ordinary course trading status on the OTCQB.

 

In September 2020, we retained DelMorgan & Co., an internationally recognized investment banking firm, to advise us on our strategic alternatives, including potential financings, asset divestitures or strategic partnerships. The Company is continuing to work closely with DelMorgan in support of their retention.

 

While we believe that our existing cash balances will be sufficient to fund our currently planned level of operations, we may require additional financing to fund our planned future operations. We do not have any firm commitments for future capital and until the Company’s securities resume ordinary course trading on the OTCQB (or are listed on a national exchange) it will be difficult to obtain financing on commercially reasonable or acceptable terms. We do not presently have, nor do we expect in the near future to have, material revenue to fund our business from our operations, and we will need to obtain all of our necessary funding from external sources in the near term. Additional financing may be required to fund our planned operations in future periods, including research and development activities relating to our principal product candidate, seeking regulatory approval of that or any other product candidate we may choose to develop, commercializing any product candidate for which we are able to obtain regulatory approval or certification, seeking to license or acquire new assets or businesses, and maintaining our intellectual property rights and pursuing rights to new technologies. We may seek to raise such funding from a variety of sources. If we raise additional funds by issuing equity or convertible debt securities, our existing stockholders’ ownership may be diluted, and obtaining commercial loans would increase our liabilities and future cash commitments. If we pursue capital through alternative sources, such as collaborations or other similar arrangements, we may be forced to relinquish rights to our proprietary technology or other intellectual property that could result in our receipt of only a portion of any revenue that may be generated from a partnered product or business. Further, we may not be able to obtain additional financing from any of these sources on commercially reasonable or acceptable terms when needed, or at all. If we cannot raise the money that we need in order to continue to operate and develop our business, we will be forced to delay, scale back or eliminate some or all of our operations. If any of these were to occur, there is a substantial risk that our business would fail and our stockholders could lose all of their investment.

 

Further, these estimates could differ if we encounter unanticipated difficulties, or if our estimates of the amount of cash necessary to operate our business prove to be wrong, and we use our available financial resources faster than we currently expect.

Covid-19 Considerations

COVID-19 Considerations

 

The global outbreak of COVID-19 has led to significant disruptions in the global economy, including the curtailment of activities by businesses and consumers in much of the world as governments and others seek to limit the spread of the disease. The extent of the impact of the pandemic on our business and financial results will depend largely on future developments, including the duration and severity of the outbreak, the length of restrictions and business closures imposed by domestic and foreign governments, the impact on capital and financial markets, all of which are highly uncertain and cannot be predicted. In the quarter ended December 31, 2020, the COVID-19 pandemic did not have a material net impact on our operating results. We have also not observed any material impairments of our assets or a significant change in the fair value of our assets due to the COVID-19 pandemic. While it is not possible at this time to estimate the full impact that COVID-19 will have on our business, restrictions resulting from COVID-19 on general economic conditions could, among other things, impair our ability to raise capital when needed. This situation is changing rapidly, and additional impacts may arise that we are not aware of currently.

Basis of Presentation of Unaudited Condensed Financial Information

Basis of Presentation of Unaudited Condensed Financial Information

 

The unaudited condensed financial statements of the Company for the three and nine months ended December 31, 2020 and 2019 have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information, applied on a consistent basis, and pursuant to the requirements for reporting on Form 10-Q and the requirements of Regulation S-K and Regulation S-X promulgated under the Securities Act of 1933, as amended (the “Securities Act”). Accordingly, they do not include all the information and footnotes required by U.S. GAAP for complete audited financial statements. However, the information included in these financial statements reflects all adjustments (consisting solely of normal recurring adjustments), which are, in the opinion of management, necessary for the fair presentation of the Company’s financial position and the results of operations. Results shown for interim periods are not necessarily indicative of the results to be obtained for a full fiscal year or any future annual or interim period. The balance sheet information as of March 31, 2020 was derived from the Company’s audited financial statements as of and for the year ended March 31, 2020 included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (the “SEC”) on June 29, 2020. These financial statements should be read in conjunction with that report.

Estimates

Estimates

 

The preparation of financial statements in conformity with generally accepted accounting principles in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the period. Actual results could differ from those estimates. Significant estimates and assumptions by management include, among others, the fair value of equity instruments issued for services, and assumptions used in the valuation of derivative liabilities and the valuation allowance for deferred tax assets, and the accrual of potential liabilities.

Financial Assets and Liabilities Measured at Fair Value

Financial Assets and Liabilities Measured at Fair Value

 

The Company uses various inputs in determining the fair value of its investments and measures these assets on a recurring basis. Financial assets recorded at fair value in the balance sheets are categorized by the level of objectivity associated with the inputs used to measure their fair value. Authoritative guidance provided by FASB defines the following levels directly related to the amount of subjectivity associated with the inputs:

 

Level 1   Quoted prices in active markets for identical assets or liabilities.
     
Level 2   Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly.
     
Level 3   Unobservable inputs based on the Company’s assumptions.

 

The carrying amounts of financial assets and liabilities, such as cash and cash equivalents, accounts payable, notes payable and advance, approximate their fair values because of the short maturity of these instruments.

Derivative Financial Instruments

Derivative Financial Instruments

 

The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported in the statements of operations. For stock-based derivative financial instruments, the Company uses a probability weighted average Black-Scholes-Merton model to value the derivative instruments at inception and on subsequent valuation dates. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period.

Share-based Payments

Share-Based Payments

 

The Company periodically issues stock options, warrants, and shares of common stock as share-based compensation to employees and non-employees in non-capital raising transactions for services and for financing costs. The Company accounts for such grants issued and vesting based on FASB ASC 718, Compensation – Stock Compensation (Topic 718) whereby the value of the award is measured on the date of grant and recognized as compensation expense on the straight-line basis over the vesting period. The Company recognizes the fair value of stock-based compensation within its Statements of Operations with classification depending on the nature of the services rendered.

 

The fair value of the Company’s stock options and warrants are estimated using the Black-Scholes-Merton Option Pricing model which uses certain assumptions related to risk-free interest rates, expected volatility, expected life of the stock options or restricted stock, and future dividends. Compensation expense is recorded based upon the value derived from the Black-Scholes-Merton Option Pricing model and based on actual experience. The assumptions used in the Black-Scholes-Merton Option Pricing model could materially affect compensation expense recorded in future periods.

Basic and Diluted Loss Per Share

Basic and Diluted Loss Per Share

 

Basic loss per share is computed by dividing the net loss applicable to common stockholders by the weighted average number of outstanding common shares during the period. Diluted loss per share is computed by dividing net loss applicable to common stockholders by the weighted average number of common shares outstanding plus the number of additional common shares that would have been outstanding if all dilutive potential common shares had been issued. Diluted loss per share excludes all potential common shares if their effect is anti-dilutive. The following potentially dilutive shares were excluded from the shares used to calculate diluted earnings per share as their inclusion would be anti-dilutive:

 

    Nine months ended  
    December 31, 2020     December 31, 2019  
Options     5,997,544       6,546,710  
Warrants     146,668       1,135,003  
Total     6,144,212       7,681,713  
Research and Development

Research and Development

 

Research and development costs consist primarily of fees paid to consultants and outside service providers, patent fees and costs, and other expenses relating to the acquisition, design, development and testing of the Company’s product candidates. Research and development costs are expensed as incurred.

Recent Accounting Pronouncements

Recent Accounting Pronouncements

 

In June 2016, the FASB issued ASU No. 2016-13, Credit Losses - Measurement of Credit Losses on Financial Instruments (“ASC 326”). ASU 2016-13 requires entities to use a forward-looking approach based on current expected credit losses (“CECL”) to estimate credit losses on certain types of financial instruments, including trade receivables. This may result in the earlier recognition of allowances for losses. ASU 2016-13 is effective for the Company beginning April 1, 2023, and early adoption is permitted. The Company does not believe the potential impact of the new guidance and related codification improvements will be material to its financial position, results of operations and cash flows.

 

In August 2020, the FASB issued ASU No. 2020-06 (“ASU 2020-06”) Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. ASU 2020-06 will simplify the accounting for convertible instruments by reducing the number of accounting models for convertible debt instruments and convertible preferred stock. Limiting the accounting models will result in fewer embedded conversion features being separately recognized from the host contract as compared with current GAAP. Convertible instruments that continue to be subject to separation models are (1) those with embedded conversion features that are not clearly and closely related to the host contract, that meet the definition of a derivative, and that do not qualify for a scope exception from derivative accounting and (2) convertible debt instruments issued with substantial premiums for which the premiums are recorded as paid-in capital. ASU 2020-06 also amends the guidance for the derivatives scope exception for contracts in an entity’s own equity to reduce form-over-substance-based accounting conclusions. ASU 2020-06 will be effective January 1, 2024, for the Company. Early adoption is permitted, but no earlier than January 1, 2021, including interim periods within that year. Management is currently evaluating the effect of the adoption of ASU 2020-06 on the consolidated financial statements, but currently does not believe ASU 2020-06 will have a significant impact on the Company’s accounting for its convertible debt instruments. The effect will largely depend on the composition and terms of the financial instruments at the time of adoption.

 

Other recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company’s present or future financial statements.

XML 29 R18.htm IDEA: XBRL DOCUMENT v3.20.4
Business Operations and Summary of Significant Accounting Policies (Tables)
9 Months Ended
Dec. 31, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share

Diluted loss per share excludes all potential common shares if their effect is anti-dilutive. The following potentially dilutive shares were excluded from the shares used to calculate diluted earnings per share as their inclusion would be anti-dilutive:

 

    Nine months ended  
    December 31, 2020     December 31, 2019  
Options     5,997,544       6,546,710  
Warrants     146,668       1,135,003  
Total     6,144,212       7,681,713  
XML 30 R19.htm IDEA: XBRL DOCUMENT v3.20.4
Operating Lease (Tables)
9 Months Ended
Dec. 31, 2020
Leases [Abstract]  
Schedule of Lease Expenses

The components of lease expense and supplemental cash flow information related to leases for the period are as follows: 

   

Nine Months

Ended

December 31, 2020

 
Lease Cost        
Operating lease cost (included in general and administrative expenses in the Company’s unaudited condensed consolidated statement of operations)   $ 111,657  
         
Other Information        
Cash paid for amounts included in the measurement of lease liabilities for the three months ended December 31, 2020   $ -  
Weighted average remaining lease term – operating leases (in years)     0.2  
Average discount rate – operating leases     4.0 %
Schedule of Supplement Related to Lease

The supplemental balance sheet information related to leases for the period is as follows:

 

    At December 31, 2020  
Operating leases        
Long-term right-of-use asset   $ 22,817  
         
Short-term operating lease liability   $ 23,194  
Total operating lease liabilities   $ 23,194  
Schedule of Maturities of Lease Liabilities

Maturities of the Company’s lease liabilities are as follows (in thousands):

 

Year Ending March 31   Operating Lease  
2021 (remaining 2 months)   $ 23,310  
Total lease payments     23,310  
Less: Imputed interest/present value discount     (116 )
Present value of lease liabilities   $ 23,194  
XML 31 R20.htm IDEA: XBRL DOCUMENT v3.20.4
Stock Options (Tables)
9 Months Ended
Dec. 31, 2020
Share-based Payment Arrangement [Abstract]  
Summary of Stock Option Activity

A summary of the Company’s stock option activity during the nine months ended December 31, 2020 is as follows:

 

    Shares    

Weighted

Average

Exercise Price

 
Balance outstanding at March 31, 2020     6,556,710     $ 0.89  
Granted     -          
Exercised     -          
Expired     (32,500 )     2.17  
Cancelled     (526,666 )     1.42  
Balance outstanding at December 31, 2020     5,997,544     $ 0.91  
Balance exercisable at December 31, 2020     4,622,544     $ 0.87  
Schedule of Stock Options Outstanding and Exercisable

A summary of the Company’s stock options outstanding and exercisable as of December 31, 2020 is as follows:

 

    Number of Options     Weighted Average Exercise Price     Weighted Average Grant- date Stock Price  
Options Outstanding, December 31, 2020     750,000     $ 0.30     $ 0.30  
      2,000,000     $ 0.35     $ 0.35  
      1,664,542     $ 0.50     $ 0.50  
      128,000     $ 0.96     $ 0.96  
      130,000     $ 1.00     $ 10.00  
      500,834       $ 1.50 - 1.95       $ 1.50 - 1.95  
      657,500       $ 2.00 - 2.79       $ 2.00 - 2.79  
      123,334       $ 3.10 - 3.80       $ 3.10 - 3.80  
      43,334       $ 4.00 - 4.70       $ 4.00 - 4.70  
      5,997,544                  
Options Exercisable, December 31, 2020     375,000     $ 0.30     $ 0.30  
      1,000,000     $ 0.35     $ 0.35  
      1,664,542     $ 0.50     $ 0.50  
      128,000     $ 0.96     $ 0.96  
      130,000     $ 1.00     $ 10.00  
      500,834       $ 1.50 - 1.95       $ $ 1.50 - 1.95  
      657,500       $ 2.00 - 2.79       $ 2.00 - 2.79  
      123,334       $ 3.10 - 3.80       $ 3.10 - 3.80  
      43,334       $ 4.00 - 4.70       $ 4.00 - 4.70  
      4,622,544                  
XML 32 R21.htm IDEA: XBRL DOCUMENT v3.20.4
Warrants (Tables)
9 Months Ended
Dec. 31, 2020
Warrants and Rights Note Disclosure [Abstract]  
Summary of Warrants Activity

A summary of warrants to purchase the Company’s common stock during the nine months ended December 31, 2020 is as follows:

 

    Shares    

Weighted

Average

Exercise Price

 
Balance outstanding at March 31, 2020     1,135,003     $ 2.19  
Granted     -       -  
Exercised     -       -  
Expired     (988,335 )     2.10  
Balance outstanding and exercisable at December 31, 2020     146,668     $ 3.00  
XML 33 R22.htm IDEA: XBRL DOCUMENT v3.20.4
Discontinued Operations (Tables)
9 Months Ended
Dec. 31, 2020
Discontinued Operations and Disposal Groups [Abstract]  
Schedule of Discontinued Operations for Summit Healthcare

The following table presents the summarized components of loss from discontinued operations for the clinical and test kit operations:

 

    Three Months Ended December 31,  
    2020     2019  
             
Revenue   $ -     $ -  
                 
Cost of sales     -       -  
Research and development     -       -  
General and administrative     -       48,769  
Loss from discontinued operations   $ -     $ (48,769 )

 

    Nine Months Ended December 31,  
    2020     2019  
             
Revenue   $ -     $ 44,698  
                 
Cost of sales     -       143,232  
Research and development     -       4,361  
General and administrative     -       611,932  
Loss from discontinued operations   $ -     $ (714,827 )
XML 34 R23.htm IDEA: XBRL DOCUMENT v3.20.4
Business Operations and Summary of Significant Accounting Policies (Details Narrative) - USD ($)
3 Months Ended 9 Months Ended
Dec. 31, 2020
Dec. 31, 2019
Dec. 31, 2020
Dec. 31, 2019
Sep. 30, 2020
Mar. 31, 2020
Sep. 30, 2019
Mar. 31, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]                
Net loss $ 692,950 $ (795,295) $ (520,220) $ (3,614,024)        
Net cash used in operating activities     (1,047,742) (2,859,341)        
Cash on hand 1,441,471   1,441,471          
Stockholders' equity 1,111,715 $ 1,899,606 1,111,715 $ 1,899,606 $ 306,456 $ 1,282,389 $ 2,552,619 $ 5,021,076
Working capital $ 1,062,741   1,062,741          
Total expected expenditure for operating expenses and investment activity     $ 1,000,000          
XML 35 R24.htm IDEA: XBRL DOCUMENT v3.20.4
Business Operations and Summary of Significant Accounting Policies - Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share (Details) - shares
9 Months Ended
Dec. 31, 2020
Dec. 31, 2019
Antidilutive securities excluded from computation of earnings per share 6,144,212 7,681,713
Options [Member]    
Antidilutive securities excluded from computation of earnings per share 5,997,544 6,546,710
Warrants [Member]    
Antidilutive securities excluded from computation of earnings per share 146,668 1,135,003
XML 36 R25.htm IDEA: XBRL DOCUMENT v3.20.4
Operating Lease (Details Narrative) - USD ($)
9 Months Ended
Dec. 31, 2020
Dec. 31, 2019
Operating lease remaining lease term 12 months  
Lease expenses $ 100,789 $ 93,845
Operating Lease Agreement [Member]    
Lease expenses $ 45,970 $ 139,218
XML 37 R26.htm IDEA: XBRL DOCUMENT v3.20.4
Operating Lease - Schedule of Lease Expenses (Details)
9 Months Ended
Dec. 31, 2020
USD ($)
Leases [Abstract]  
Operating lease cost (included in general and administrative expenses in the Company's unaudited condensed consolidated statement of operations) $ 111,657
Cash paid for amounts included in the measurement of lease liabilities for the three months ended December 31, 2020
Weighted average remaining lease term - operating leases (in years) 2 months 12 days
Average discount rate - operating leases 4.00%
XML 38 R27.htm IDEA: XBRL DOCUMENT v3.20.4
Operating Lease - Schedule of Supplement Related to Lease (Details) - USD ($)
Dec. 31, 2020
Mar. 31, 2020
Leases [Abstract]    
Operating Leases: Long-term right-of-use asset $ 22,817 $ 123,606
Operating Leases: Short-term operating lease liability 23,194 $ 125,679
Operating Leases: Total operating lease liabilities $ 23,194  
XML 39 R28.htm IDEA: XBRL DOCUMENT v3.20.4
Operating Lease - Schedule of Maturities of Lease Liabilities (Details)
Dec. 31, 2020
USD ($)
Leases [Abstract]  
2021 (remaining 2 months) $ 23,310
Total lease payments 23,310
Less: Imputed interest/present value discount (116)
Present value of lease liabilities $ 23,194
XML 40 R29.htm IDEA: XBRL DOCUMENT v3.20.4
Gain on Extinguishment of Note Payable (Details Narrative) - USD ($)
3 Months Ended 9 Months Ended
Nov. 21, 2020
Dec. 31, 2020
Dec. 31, 2019
Dec. 31, 2020
Dec. 31, 2019
May 06, 2020
Gain on extinguishment of loan   $ 97,516 $ 97,516  
Paycheck Protection Program [Member]            
Forgiveness of loan $ 97,516          
Accrued interest $ 528          
Paycheck Protection Program [Member] | U.S. Bank [Member]            
Loans payable           $ 96,988
Debt instrument, interest rate           1.00%
XML 41 R30.htm IDEA: XBRL DOCUMENT v3.20.4
Gain on Settlement (Details Narrative) - USD ($)
3 Months Ended 9 Months Ended
Dec. 31, 2020
Dec. 31, 2019
Dec. 31, 2020
Dec. 31, 2019
Nov. 30, 2020
Gain On Settlement Details Narrative Abstract          
Due to vendor   $ 1,100,000   $ 1,100,000  
Accounts payable to vendor         $ 612,405
Gain on settlement of outstanding invoices     $ 612,405  
Payment from vendor     450,000    
Gain on settlement $ 1,062,405 $ 1,062,405  
XML 42 R31.htm IDEA: XBRL DOCUMENT v3.20.4
Advance (Details Narrative) - USD ($)
Dec. 31, 2020
Mar. 31, 2020
Jul. 31, 2018
Receivables [Abstract]      
Advance $ 296,653 $ 296,653 $ 250,000
Other current liabilities     $ 46,653
XML 43 R32.htm IDEA: XBRL DOCUMENT v3.20.4
Stock Options (Details Narrative) - USD ($)
9 Months Ended
Dec. 31, 2020
Dec. 31, 2019
Mar. 31, 2020
Share-based Payment Arrangement [Abstract]      
Stock-based compensation expense $ 349,546 $ 492,554  
Unamortized cost of outstanding stock-based awards $ 160,000    
Weighted average remaining vesting period 1 year    
Outstanding stock options 5,997,544   6,556,710
XML 44 R33.htm IDEA: XBRL DOCUMENT v3.20.4
Stock Options - Summary of Stock Option Activity (Details)
9 Months Ended
Dec. 31, 2020
$ / shares
shares
Share-based Payment Arrangement [Abstract]  
Shares Outstanding, Beginning Balance Outstanding | shares 6,556,710
Shares, Granted | shares
Shares, Exercised | shares
Shares, Expired | shares (32,500)
Shares, Cancelled | shares (526,666)
Shares Outstanding, Ending Balance | shares 5,997,544
Shares, Balance Exercisable | shares 4,622,544
Weighted Average Exercise Price, Outstanding Beginning Balance | $ / shares $ 0.89
Weighted Average Exercise Price, Granted | $ / shares
Weighted Average Exercise Price, Exercised | $ / shares
Weighted Average Exercise Price, Expired | $ / shares 2.17
Weighted Average Exercise Price, Cancelled | $ / shares 1.42
Weighted Average Exercise Price, Outstanding Ending Balance | $ / shares 0.91
Weighted Average Exercise Price, Balance Exercisable | $ / shares $ 0.87
XML 45 R34.htm IDEA: XBRL DOCUMENT v3.20.4
Stock Options - Schedule of Stock Options Outstanding and Exercisable (Details) - $ / shares
9 Months Ended
Dec. 31, 2020
Mar. 31, 2020
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Number of Options, Options Outstanding 5,997,544 6,556,710
Weighted Average Grant-date Stock Price, Options Outstanding  
Number of Options, Options Exercisable 4,622,544  
Stock Options One [Member]    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Number of Options, Options Outstanding 750,000  
Weighted Average Exercise Price, Options Outstanding $ 0.30  
Weighted Average Grant-date Stock Price, Options Outstanding $ 0.30  
Number of Options, Options Exercisable 375,000  
Weighted Average Exercise Price, Options Exercisable $ 0.30  
Weighted Average Grant-date Stock Price, Options Exercisable $ 0.30  
Stock Options Two [Member]    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Number of Options, Options Outstanding 2,000,000  
Weighted Average Exercise Price, Options Outstanding $ 0.35  
Weighted Average Grant-date Stock Price, Options Outstanding $ 0.35  
Number of Options, Options Exercisable 1,000,000  
Weighted Average Exercise Price, Options Exercisable $ 0.35  
Weighted Average Grant-date Stock Price, Options Exercisable $ 0.35  
Stock Options Three [Member]    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Number of Options, Options Outstanding 1,664,542  
Weighted Average Exercise Price, Options Outstanding $ 0.50  
Weighted Average Grant-date Stock Price, Options Outstanding $ 0.50  
Number of Options, Options Exercisable 1,664,542  
Weighted Average Exercise Price, Options Exercisable $ 0.50  
Weighted Average Grant-date Stock Price, Options Exercisable $ 0.50  
Stock Options Four [Member]    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Number of Options, Options Outstanding 128,000  
Weighted Average Exercise Price, Options Outstanding $ 0.96  
Weighted Average Grant-date Stock Price, Options Outstanding $ 0.96  
Number of Options, Options Exercisable 128,000  
Weighted Average Exercise Price, Options Exercisable $ 0.96  
Weighted Average Grant-date Stock Price, Options Exercisable $ 0.96  
Stock Options Five [Member]    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Number of Options, Options Outstanding 130,000  
Weighted Average Exercise Price, Options Outstanding $ 1.00  
Weighted Average Grant-date Stock Price, Options Outstanding $ 10.00  
Number of Options, Options Exercisable 130,000  
Weighted Average Exercise Price, Options Exercisable $ 1.00  
Weighted Average Grant-date Stock Price, Options Exercisable $ 10.00  
Stock Options Six [Member]    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Number of Options, Options Outstanding 500,834  
Number of Options, Options Exercisable 500,834  
Stock Options Six [Member] | Minimum [Member]    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Weighted Average Exercise Price, Options Outstanding $ 1.50  
Weighted Average Grant-date Stock Price, Options Outstanding 1.50  
Weighted Average Exercise Price, Options Exercisable 1.50  
Weighted Average Grant-date Stock Price, Options Exercisable 1.50  
Stock Options Six [Member] | Maximum [Member]    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Weighted Average Exercise Price, Options Outstanding 1.95  
Weighted Average Grant-date Stock Price, Options Outstanding 1.95  
Weighted Average Exercise Price, Options Exercisable 1.95  
Weighted Average Grant-date Stock Price, Options Exercisable $ 1.95  
Stock Options Seven [Member]    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Number of Options, Options Outstanding 657,500  
Number of Options, Options Exercisable 657,500  
Stock Options Seven [Member] | Minimum [Member]    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Weighted Average Exercise Price, Options Outstanding $ 2.00  
Weighted Average Grant-date Stock Price, Options Outstanding 2.00  
Weighted Average Exercise Price, Options Exercisable 2.00  
Weighted Average Grant-date Stock Price, Options Exercisable 2.00  
Stock Options Seven [Member] | Maximum [Member]    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Weighted Average Exercise Price, Options Outstanding 2.79  
Weighted Average Grant-date Stock Price, Options Outstanding 2.79  
Weighted Average Exercise Price, Options Exercisable 2.79  
Weighted Average Grant-date Stock Price, Options Exercisable $ 2.79  
Stock Options Eight [Member]    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Number of Options, Options Outstanding 123,334  
Number of Options, Options Exercisable 123,334  
Stock Options Eight [Member] | Minimum [Member]    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Weighted Average Exercise Price, Options Outstanding $ 3.10  
Weighted Average Grant-date Stock Price, Options Outstanding 3.10  
Weighted Average Exercise Price, Options Exercisable 3.10  
Weighted Average Grant-date Stock Price, Options Exercisable 3.10  
Stock Options Eight [Member] | Maximum [Member]    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Weighted Average Exercise Price, Options Outstanding 3.80  
Weighted Average Grant-date Stock Price, Options Outstanding 3.80  
Weighted Average Exercise Price, Options Exercisable 3.80  
Weighted Average Grant-date Stock Price, Options Exercisable $ 3.80  
Stock Options Nine[Member]    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Number of Options, Options Outstanding 43,334  
Number of Options, Options Exercisable 43,334  
Stock Options Nine[Member] | Minimum [Member]    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Weighted Average Exercise Price, Options Outstanding $ 4.00  
Weighted Average Grant-date Stock Price, Options Outstanding 4.00  
Weighted Average Exercise Price, Options Exercisable 4.00  
Weighted Average Grant-date Stock Price, Options Exercisable 4.00  
Stock Options Nine[Member] | Maximum [Member]    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Weighted Average Exercise Price, Options Outstanding 4.70  
Weighted Average Grant-date Stock Price, Options Outstanding 4.70  
Weighted Average Exercise Price, Options Exercisable 4.70  
Weighted Average Grant-date Stock Price, Options Exercisable $ 4.70  
XML 46 R35.htm IDEA: XBRL DOCUMENT v3.20.4
Warrants (Details Narrative)
Dec. 31, 2020
shares
Warrants [Member]  
Outstanding warrants 146,668
XML 47 R36.htm IDEA: XBRL DOCUMENT v3.20.4
Warrants - Summary of Warrants Activity (Details) - Warrants [Member]
9 Months Ended
Dec. 31, 2020
$ / shares
shares
Number of Shares, Warrants Outstanding, Beginning Balance | shares 1,135,003
Number of Shares, Warrants Granted | shares
Number of Shares, Warrants Exercised | shares
Number of Shares, Warrants Expired | shares (988,335)
Number of Shares, Warrants Outstanding and Exercisable Ending Balance | shares 146,668
Weighted Average Exercise Price, Warrants Outstanding, Beginning Balance | $ / shares $ 2.19
Weighted Average Exercise Price, Warrants Outstanding, Granted | $ / shares
Weighted Average Exercise Price, Warrants Outstanding, Exercised | $ / shares
Weighted Average Exercise Price, Warrants Outstanding, Expired | $ / shares 2.10
Weighted Average Exercise Price, Warrants Outstanding, Outstanding and Exercisable, Ending Balance | $ / shares $ 3.00
XML 48 R37.htm IDEA: XBRL DOCUMENT v3.20.4
Discontinued Operations - Schedule of Discontinued Operations for Summit Healthcare (Details) - USD ($)
3 Months Ended 9 Months Ended
Dec. 31, 2020
Dec. 31, 2019
Dec. 31, 2020
Dec. 31, 2019
Discontinued Operations and Disposal Groups [Abstract]        
Revenue $ 44,698
Cost of sales 143,232
Research and development 4,361
General and administrative 48,769 611,932
Loss from discontinued operations $ (48,769) $ (714,827)
XML 49 R38.htm IDEA: XBRL DOCUMENT v3.20.4
Commitments and Contingencies (Details Narrative)
Aug. 19, 2016
shares
Common Stock One [Member]  
Common stock issuable upon exercise of certain warrants 2,650,000
Common Stock Two [Member]  
Common stock issuable upon exercise of certain warrants 7,950,000
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