Quarterly report pursuant to Section 13 or 15(d)


6 Months Ended
Oct. 31, 2016
Liquidity And Management Plans  



The Company's condensed consolidated financial statements are prepared using accounting principles generally accepted in the United States (“U.S. GAAP”) applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. As of October 31, 2016, the Company had an accumulated deficit of $86,698,134 and incurred a net loss for the six months ended October 31, 2016 of $2,006,517.


During the six months ended October 31, 2016, approximately $1.3 million of funding was provided by investors to maintain and expand the Company’s operations. The remaining challenges, beyond the regulatory and clinical aspects, include accessing funding for the Company to cover its future cash flow needs. During the six months ended October 31, 2016, the Company acquired funds through the Company’s S-3 Registration Statement pursuant to which its exclusive placement agent, Chardan Capital Markets, LLC (“Chardan”), sold shares of common stock “at-the-market” or in negotiated block trades in a program which is structured to provide up to $50 million dollars to the Company less certain commissions.


The Company requires substantial additional capital to finance its planned business operations and expects to incur operating losses in future periods due to the expenses related to the Company’s core businesses. The Company has not realized material revenue since it commenced doing business in the biotechnology sector, and there can be no assurance that it will be successful in generating revenues in the future in this sector. The Company believes that cash as of October 31, 2016, any sales of unregistered shares of its common stock and any public offerings of common stock the Company may engage in will provide sufficient capital to meet its capital requirements and to fund its operations through October 31, 2017. However, the Company’s ability to raise additional capital is limited by its inability to use a short form registration statement on Form S-3. As of the date of this Report, the Company does not meet the eligibility requirements in order for it to be able to conduct a primary offering of its common stock under Form S-3 or to file a new Registration Statement on Form S-3. The Company may be able to regain the use of Form S-3 if it meets one or both of the eligibility criteria, including: (i) the aggregate market value of the Company’s common stock held by non-affiliates exceeds $75 million; or (ii) the common stock is listed and registered on a national securities exchange.


If the Company is not able to raise substantial additional capital in a timely manner, the Company may not be able to commence or complete its planned clinical trials and preclinical studies.


The Company will continue to be dependent on outside capital to fund its research and operating expenditures for the foreseeable future. If the Company fails to generate positive cash flows or fails to obtain additional capital when required, the Company may need to modify, delay or abandon some or all of its business plans.


Management Goal and Strategies to Implement


The Company’s goal is to become an industry-leading biotechnology company using the Cell-in-a-Box® technology as a platform upon which therapies for cancer and diabetes are developed and obtain marketing approval for these therapies from regulatory agencies in the U.S., the European Union, Australia and Canada.


The Company’s strategies to achieve this goal consist of the following:


  · The completion of clinical trials in locally advanced, inoperable non-metastatic pancreatic cancer and its associated pain;


  · The completion of preclinical studies and clinical trials that will demonstrate the effectiveness of the Company’s cancer therapy in reducing the production and accumulation of malignant ascites fluid in the abdomen that is characteristic of pancreatic and other abdominal cancers;


  · The completion of preclinical studies and clinical trials that involve the encapsulation of the Melligen cells using the Cell-in-a-Box® technology to develop a treatment for Type 1 diabetes and insulin-dependent Type 2 diabetes;


  · The enhancement of the Company’s ability to expand into the biotechnology arena through further research and partnering agreements in cancer and diabetes;


  · The acquisition of contracts that generate revenue or provide research and development capital utilizing the Company’s sublicensing rights;


  · The further development of uses of the Cell-in-a-Box® technology platform through contracts, licensing agreements and joint ventures with other companies; and
  · The completion of testing, expansion and marketing of existing and newly derived product candidates.