• Filing Date: 2019-05-13
  • Form Type: 10-Q
  • Description: Quarterly report
v3.19.1
Document and Entity Information - shares
3 Months Ended
Mar. 31, 2019
May 10, 2019
Document And Entity Information    
Entity Registrant Name PROVECTUS BIOPHARMACEUTICALS, INC.  
Entity Central Index Key 0000315545  
Document Type 10-Q  
Document Period End Date Mar. 31, 2019  
Amendment Flag false  
Current Fiscal Year End Date --12-31  
Entity Filer Category Non-accelerated Filer  
Entity Small Business Flag true  
Entity Emerging Growth Company false  
Entity Ex Transition Period false  
Entity Common Stock, Shares Outstanding   384,714,528
Trading Symbol PVCT  
Document Fiscal Period Focus Q1  
Document Fiscal Year Focus 2019  
v3.19.1
Condensed Consolidated Balance Sheets - USD ($)
Mar. 31, 2019
Dec. 31, 2018
Current Assets:    
Cash and cash equivalents $ 1,767,900 $ 50,986
Short-term receivables - legal fees, settlement and other, net 604,269 595,326
Prepaid expenses 271,984 370,209
Total Current Assets 2,715,477 1,016,521
Equipment and furnishings, less accumulated depreciation of $54,061 and $50,538, respectively 68,953 72,476
Operating lease right-of-use asset 247,763
Patents, net of accumulated amortization of $10,983,998 and $10,816,218, respectively 731,447 899,227
Total Assets 3,692,316 1,988,224
Current Liabilities:    
Accounts payable - trade 1,459,117 3,312,049
Other accrued expenses 1,338,632 790,358
Current portion of operating lease liability 73,437
Total Current Liabilities 2,871,186 4,102,407
Accrued interest 856,131 659,379
Accrued interest - related parties 849,749 711,927
Convertible notes payable 10,837,000 7,062,000
Convertible notes payable - related parties 6,895,000 6,870,000
Non-current portion of operating lease liability 187,602
Total Liabilities 22,496,668 19,405,713
Commitments and contingencies (Note 7)
Stockholders' Deficiency:    
Preferred stock; par value $0.001 per share; 25,000,000 shares authorized; Series B Convertible Preferred Stock; 240,000 shares designated; 100 shares issued and outstanding at March 31, 2019 and December 31, 2018; aggregate liquidation preference of $3,500 at March 31, 2019 and December 31, 2018
Common stock; par value $0.001 per share; 1,000,000,000 shares authorized; 384,714,528 and 384,614,528 shares issued and outstanding at March 31, 2019 and December 31, 2018, respectively 384,715 384,615
Additional paid-in capital 209,097,417 209,092,187
Accumulated other comprehensive loss (22,363)
Accumulated deficit (228,264,121) (226,894,291)
Total Stockholders' Deficiency (18,804,352) (17,417,489)
Total Liabilities and Stockholders' Deficiency $ 3,692,316 $ 1,988,224
v3.19.1
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($)
Mar. 31, 2019
Dec. 31, 2018
Accumulated depreciation on equipment and furnishings $ 54,061 $ 50,538
Accumulated amortization on patents $ 10,983,998 $ 10,816,218
Preferred stock, par value $ 0.001 $ 0.001
Preferred stock, shares authorized 25,000,000 25,000,000
Aggregate liquidation preference $ 3,500 $ 3,500
Common stock, par value $ 0.001 $ 0.001
Common stock, shares authorized 1,000,000,000 1,000,000,000
Common stock, shares issued 384,714,528 384,614,528
Common stock, shares outstanding 384,714,528 384,614,528
Series B Convertible Preferred Stock [Member]    
Preferred stock, shares authorized 240,000 240,000
Preferred stock, shares designated 240,000 240,000
Preferred stock, shares issued 100 100
Preferred stock, shares outstanding 100 100
v3.19.1
Condensed Consolidated Statements of Operations (Unaudited) - USD ($)
3 Months Ended
Mar. 31, 2019
Mar. 31, 2018
Operating Expenses:    
Research and development $ 1,037,331 $ 1,943,063
General and administrative 759,253 756,151
Total Operating Expenses 1,796,584 2,699,214
Total Operating Loss (1,796,584) (2,699,214)
Other Income/(Expense):    
Gain on settlement of lawsuits 675,000
Research and development tax credit 84,072
Investment and interest income 2,255 6,169
Interest expense (334,573) (206,567)
Net Loss $ (1,369,830) $ (2,899,612)
Basic and Diluted Loss Per Common Share $ (0.00) $ (0.01)
Weighted Average Number of Common Shares Outstanding - Basic and Diluted 384,705,639 377,369,385
v3.19.1
Condensed Consolidated Statements of Comprehensive Loss (Unaudited) - USD ($)
3 Months Ended
Mar. 31, 2019
Mar. 31, 2018
Income Statement [Abstract]    
Net Loss $ (1,369,830) $ (2,899,612)
Other Comprehensive Loss:    
Foreign currency translation adjustments (22,363)
Total Comprehensive Loss $ (1,392,193) $ (2,899,612)
v3.19.1
Condensed Consolidated Statement of Changes in Stockholders' Deficiency (Unaudited) - USD ($)
3 Months Ended
Mar. 31, 2019
Mar. 31, 2018
Series B Preferred Stock [Member]    
Beginning Balance
Beginning Balance, shares 100 100
Common stock issued upon exercise of warrants
Net loss
Other comprehensive loss  
Ending Balance
Ending Balance, shares 100 100
Common Stock [Member]    
Beginning Balance $ 384,615 $ 370,962
Beginning Balance, shares 384,614,528 370,961,451
Common stock issued upon exercise of warrants $ 100 $ 7,927
Common stock issued upon exercise of warrants, shares 100,000 7,926,739
Net loss
Other comprehensive loss  
Ending Balance $ 384,715 $ 378,889
Ending Balance, shares 384,714,528 378,888,190
Additional Paid-In Capital [Member]    
Beginning Balance $ 209,092,187 $ 208,351,431
Common stock issued upon exercise of warrants 5,230 414,568
Net loss
Other comprehensive loss  
Ending Balance 209,097,417 208,765,999
Accumulated Other Comprehensive Loss [Member]    
Beginning Balance  
Common stock issued upon exercise of warrants  
Net loss  
Other comprehensive loss (22,363)  
Ending Balance (22,363)  
Accumulated Deficit [Member]    
Beginning Balance (226,894,291) (218,741,236)
Common stock issued upon exercise of warrants
Net loss (1,369,830) (2,899,612)
Other comprehensive loss  
Ending Balance (228,264,121) (221,640,848)
Beginning Balance (17,417,489) (10,018,843)
Common stock issued upon exercise of warrants 5,330 422,495
Net loss (1,369,830) (2,899,612)
Other comprehensive loss (22,363)
Ending Balance $ (18,804,352) $ (12,495,960)
v3.19.1
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($)
3 Months Ended
Mar. 31, 2019
Mar. 31, 2018
Cash Flows From Operating Activities:    
Net loss $ (1,369,830) $ (2,899,612)
Adjustments to reconcile net loss to net cash used in operating activities:    
Stock-based compensation 2,650
Depreciation 21,311 3,524
Amortization of patents 167,780 167,780
Changes in operating assets and liabilities    
Settlement receivable (33,943) 246,284
Prepaid expenses 98,225 99,747
Accounts payable - trade (1,857,444) 411,271
Other accrued expenses 570,624 24,536
Accrued interest expense 334,574 206,568
Net Cash Used In Operating Activities (2,066,053) (1,739,902)
Cash Flows From Financing Activities:    
Proceeds from issuance of convertible notes payable 3,775,000 706,000
Proceeds from issuance of convertible notes payable - related parties 25,000 750,000
Proceeds from exercise of warrants 5,330 422,494
Net Cash Provided By Financing Activities 3,805,330 1,878,494
Effect of Exchange Rate Changes on Cash (22,363)
Net Increase In Cash and Cash Equivalents 1,716,914 138,592
Cash and Cash Equivalents, Beginning of Period 50,986 105,504
Cash and Cash Equivalents, End of Period 1,767,900 244,096
Supplemental Disclosures of Cash Flow Information:    
Interest
Taxes
Non-cash investing and financing activities:    
Offset of related party receivable and payable $ 25,000
v3.19.1
Business Organization, Nature of Operations and Basis of Presentation
3 Months Ended
Mar. 31, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Business Organization, Nature of Operations and Basis of Presentation

1. Business Organization, Nature of Operations and Basis of Presentation

 

Provectus Biopharmaceuticals, Inc., a Delaware corporation (together with its subsidiaries, “Provectus” or the “Company”), is a clinical-stage biotechnology company developing a new class of drugs for oncology and dermatology based on chemical small molecules called halogenated xanthenes. Intralesional PV-10 is undergoing clinical study for adult solid tumor cancers, like melanoma and gastrointestinal cancers, and preclinical study for pediatric cancers. Topical PH-10 is undergoing clinical study for inflammatory dermatoses, like psoriasis and atopic dermatitis. To date, the Company has not generated any revenues from planned principal operations. The Company’s activities are subject to significant risks and uncertainties, including failing to successfully develop and license or commercialize the Company’s prescription drug candidates.

 

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information pursuant to Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements and should be reviewed in conjunction with the Company’s audited consolidated financial statements included in the Company’s Form 10-K for the year ended December 31, 2018 filed with the U.S. Securities and Exchange Commission (the “SEC”) on March 7, 2019. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three months ended March 31, 2019 are not necessarily indicative of the results that may be expected for the year ending December 31, 2019.

v3.19.1
Liquidity and Going Concern
3 Months Ended
Mar. 31, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Liquidity and Going Concern

2. Liquidity and Going Concern

 

The Company’s cash and cash equivalents were $1,767,900 at March 31, 2019, The Company continues to incur significant operating losses. Management expects that significant on-going operating expenditures will be necessary to successfully implement the Company’s business plan and develop and market its products. These circumstances raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that these financial statements are issued. Implementation of the Company’s plans and its ability to continue as a going concern will depend upon the Company’s ability to develop PV-10 and PH-10 and to raise additional capital.

 

The Company plans to access capital resources through possible public or private equity offerings, including the 2017 Financing (as defined in Note 4), exchange offers, debt financings, corporate collaborations or other means. In addition, the Company continues to explore opportunities to strategically monetize its lead drug candidates, PV-10 and PH-10, through potential co-development and licensing transactions, although there can be no assurance that the Company will be successful with such plans. The Company has historically been able to raise capital through equity offerings, although no assurance can be provided that it will continue to be successful in the future. If the Company is unable to raise sufficient capital through the 2017 Financing or otherwise, it will not be able to pay its obligations as they become due.

  

The primary business objective of management is to build the Company into a commercial-stage biotechnology company; however, the Company cannot assure that it will be successful in co-developing, licensing, and/or commercializing PV-10, PH-10, and/or any other halogenated xanthene-based drug candidate developed by the Company, or entering into any financial transaction. Moreover, even if the Company is successful in improving its current cash flow position, the Company nonetheless plans to seek additional funds to meet its long-term requirements in 2019 and beyond. The Company anticipates that these funds will otherwise come from the proceeds of private placement transactions, including the 2017 Financing, the exercise of existing warrants and outstanding stock options, or public offerings of debt or equity securities. While the Company believes that it has a reasonable basis for its expectation that it will be able to raise additional funds, the Company cannot provide assurance that it will be able to complete additional financing in a timely manner. In addition, any such financing may result in significant dilution to stockholders.

v3.19.1
Critical Accounting Policies
3 Months Ended
Mar. 31, 2019
Accounting Policies [Abstract]  
Critical Accounting Policies

3. Critical Accounting Policies  

 

Since the date the Company’s December 31, 2018 consolidated financial statements were issued in its 2018 Annual Report, there have been no material changes to the Company’s significant accounting policies, except as disclosed below.

 

Leases

 

In February 2016, the Financial Accounting Standards Board (“FASB”) issued a new standard related to leases to increase transparency and comparability among organizations by requiring the recognition of operating lease right-of-use (“ROU”) assets and lease liabilities on the balance sheet (“ASC 842”) with amendments issued in 2018. Most prominent among the changes in the standard is the recognition of ROU assets and lease liabilities by lessees for those leases classified as operating leases. Under the standard, disclosures are required to meet the objective of enabling users of financial statements to assess the amount, timing, and uncertainty of cash flows arising from leases. The Company is also required to recognize and measure new leases at the adoption date and recognize a cumulative-effect adjustment in the period of adoption using a modified retrospective approach, with certain practical expedients available.

 

The Company adopted ASC 842 effective January 1, 2019 and elected to apply the available practical expedients. The standard had an impact on the Company’s condensed consolidated balance sheets but did not have a material impact on the Company’s condensed consolidated statements of operations or condensed consolidated statements of cash flows upon adoption. The most significant impact was the recognition of ROU assets and lease liabilities for operating leases, while the Company’s accounting for finance leases remained substantially unchanged. The adoption of ASC 842 did not have a material impact in the current year and prior year comparative periods and as a result, a cumulative-effect adjustment was not required.

 

Reclassifications 

 

Certain prior year balances have been reclassified in order to conform to current year presentation. These reclassifications have no effect on previously reported results of operations or loss per share.

v3.19.1
Convertible Notes Payable
3 Months Ended
Mar. 31, 2019
Debt Disclosure [Abstract]  
Convertible Notes Payable

4. Convertible Notes Payable

 

On March 23, 2017, the Company entered into an exclusive Definitive Financing Commitment Term Sheet with a group of the Company’s stockholders (the “PRH Group”), which was amended and restated effective as of March 19, 2017 (the “Term Sheet”) that set forth the terms on which the PRH Group would use their best efforts to arrange for a financing of a minimum of $10,000,000 and maximum of $20,000,000 (the “2017 Financing”).

 

As of March 31, 2019, the Company had received aggregate loans of $17,732,000 in connection with the 2017 Financing.

  

As of March 31, 2019, and through the date of filing, the Series D Preferred Stock had not been designated by the Company’s Board of Directors (the “Board”). As a result, the Company did not analyze the loan for a potential beneficial conversion feature as the definition of a firm commitment has not been met since the PRH Notes were not convertible as of their respective dates of issuance or as of March 31, 2019.

 

Convertible Notes Payable – Related Parties

 

During the three months ended March 31, 2019, the Company entered into additional PRH Notes with a related party in the aggregate principal amount of $25,000.

 

As of March 31, 2019, the Company had borrowed $6,895,000 of PRH Notes from related parties which were outstanding.

 

Convertible Notes Payable – Non-Related Parties

 

During the three months ended March 31, 2019, the Company entered into additional PRH Notes with accredited investors in the aggregate principal amount of $3,775,000.

 

As of March 31, 2019, the Company had borrowed $10,837,000 of PRH Notes from non-related parties which were outstanding.

v3.19.1
Stockholders' Deficiency
3 Months Ended
Mar. 31, 2019
Equity [Abstract]  
Stockholders' Deficiency

5. Stockholders’ Deficiency

 

Exercise of Warrants

 

During the three months ended March 31, 2019, warrant holders exercised warrants to purchase an aggregate of 100,000 shares of common stock at a price of $0.0533 per share. In connection with these exercises, the Company received aggregate cash proceeds of $5,330 and issued 100,000 shares of common stock to the warrant holders.

v3.19.1
Leases
3 Months Ended
Mar. 31, 2019
Leases [Abstract]  
Leases

6. Leases

 

The Company currently leases 4,500 square feet of corporate office space in Knoxville, Tennessee through an operating lease agreement for a term of five years ending on June 30, 2022. Payments range from approximately $7,300 to $7,800 per month.

 

Total rent expense for the three months ended March 31, 2019 was $34,806, of which, $23,204 was included within research and development and $11,602 was included within general and administrative expenses on the condensed consolidated statement of operations. Total rent expense for the three months ended March 31, 2018 was $22,153, of which, $14,768 was included within research and development and $7,385 was included within general and administrative expenses on the condensed consolidated statement of operations.

 

As of March 31, 2019, the Company had no leases that were classified as a financing lease. As of March 31, 2019, the Company did not have additional operating and financing leases that have not yet commenced. 

 

A summary of the Company’s right-of-use assets and liabilities is as follows:

 

    Three Months Ended
March 31, 2019
 
       
Cash paid for amounts included in the measurement of lease liabilities:        
Operating cash flows from operating leases   $ 22,001  
         
Right-of-use assets obtained in exchange for lease obligations:        
Operating leases   $ 265,550  
         
Weighted Average Remaining Lease Term        
Operating leases     3.25 years  
         
Weighted Average Discount Rate        
Operating leases     8.0 %

 

Future minimum payments under non-cancellable lease as of March 31, 2019 were as follows:

 

For the Years Ending December 31,   Amount  
       
2019   $ 66,883  
2020     90,666  
2021     92,471  
2022     46,687  
Total future minimum lease payments     296,707  
Less: amount representing imputed interest     (35,668 )
Total   $ 261,039  
v3.19.1
Commitments, Contingencies and Litigation
3 Months Ended
Mar. 31, 2019
Commitments and Contingencies Disclosure [Abstract]  
Commitments, Contingencies and Litigation

7. Commitments, Contingencies and Litigation

 

Culpepper Travel Expenses and Related Collection Efforts

 

On December 27, 2016, the then-Board of Directors (the “then-Board”) unanimously voted to terminate then-interim Chief Executive Officer and Chief Operating Officer, and former Chief Financial Officer, Peter Culpepper (“Culpepper”), effective immediately, from all positions he held with the Company and each of its subsidiaries, “for cause”, in accordance with the terms of the Amended and Restated Executive Employment Agreement entered into by Culpepper and the Company on April 28, 2014 (the “Culpepper Employment Agreement”) based on the results of the investigation conducted by the Audit Committee of the then-Board regarding improper expense reimbursements to Culpepper.

 

The Audit Committee retained independent counsel and an advisory firm with forensic accounting expertise to assist the Audit Committee in conducting the investigation. The Audit Committee found that Culpepper received $294,255 in expense reimbursements that were unsubstantiated or otherwise improper. The Company seeks to recover from Culpepper the entire $294,255 in expense reimbursements, as well as all attorney’s fees and auditors’/experts’ fees incurred by the Company in connection with the examination of his expense reimbursements. On December 12, 2017, Culpepper agreed to an order by the SEC to pay disgorgement of $140,115, and prejudgment interest of $12,261, for a total of $152,376, to the Company within 30 days. The Company received the payment of $152,376 in January 2018.

  

The Company took the position that under the terms of the Culpepper Employment Agreement, Culpepper is owed no severance payments as a result of his termination “for cause” as that term is defined in the Culpepper Employment Agreement. Furthermore, Culpepper is no longer entitled to the 2:1 credit under the Stipulated Settlement Agreement and Mutual Release in the Derivative Lawsuit Settlement such that the total $2,240,000 owed by Culpepper pursuant to the Derivative Lawsuit Settlement plus Culpepper’s proportionate share of the litigation cost in the amount of $227,750, less the amount that he repaid as of December 31, 2016, is immediately due and payable. The Company sent Culpepper a notice of default in January 2017 for the total amount he owes the Company and is in the process of pursuing these claims in accordance with the alternative dispute resolution provision of the Culpepper Employment Agreement. The Company has established a reserve of $2,051,083 as of March 31, 2019 and December 31, 2018, which amount represents the amount the Company currently believes Culpepper owes to the Company under the Derivative Lawsuit Settlement (excluding the amount of attorneys’ fees incurred in enforcing the terms of the Derivative Lawsuit Settlement), while the Company pursues collection of this amount.

 

Culpepper disputed that he was terminated “for cause” under the Culpepper Employment Agreement. Pursuant to the alternative dispute resolution provisions of that agreement, the Company and Culpepper participated in a mediation of their dispute on June 28, 2017. Having reached no resolution during the mediation, the parties participated in arbitration under the commercial rules of the American Arbitration Association, arbitrating both Culpepper’s claim for severance against the Company and the Company’s claims against Culpepper for improper expense reimbursements and amounts Culpepper owes the Company under the Derivative Lawsuit Settlement (the “Culpepper Arbitration”). The Culpepper Arbitration hearing was held from May 15-18, 2018.

 

On July 12, 2018, the arbitrator issued an interim award in favor of the Company, the terms of which are confidential pursuant to the Culpepper Employment Agreement and instructed the parties that a final award was forthcoming. On September 12, 2018, the arbitrator issued his final award in favor of the Company. On October 4, 2018, the Company filed a petition with the Chancery Court for Davidson County, Tennessee to confirm the arbitration award. On November 7, 2018, the Company received Culpepper’s answer to the petition filed on October 4, 2018. This court entered an order confirming the arbitrator’s award on January 23, 2019. On February 20, 2019, Culpepper filed a motion to alter or amend this judgment. On March 22, 2019, the Chancery Court upheld the arbitration award in favor of the Company. On April 16, 2019, Culpepper filed a Notice of Appeal with the Tennessee Court of Appeals regarding the judgment confirming the arbitration award and the order denying Culpepper’s motion to alter or amend the judgment.

 

The Bible Harris Smith Lawsuit

 

On November 17, 2016, the Company filed a lawsuit in the Circuit Court for Knox County, Tennessee against Bible Harris Smith PC (“BHS”) for professional negligence, common law negligence, and breach of fiduciary duty arising from the accounting services provided by BHS to the Company. On January 28, 2019, this matter was resolved pursuant to a settlement between the parties, the terms of which are confidential. The proceeds from the settlement were received and recorded during the three months ended March 31, 2019.

 

The RSM USA LLP Lawsuit

 

On June 9, 2017, the Company filed a lawsuit in the Circuit Court for Mecklenburg County, North Carolina against RSM USA LLP (“RSM”) for professional negligence, common law negligence, gross negligence, intentional misrepresentation, negligent misrepresentation, and breach of fiduciary duty arising from accounting, internal auditing, and consulting services provided by RSM to the Company. On February 27, 2019, the matter was resolved pursuant to a settlement between the parties, the terms of which are confidential. The proceeds from the settlement were received and recorded during the three months ended March 31, 2019.

 

Employment of Chief Financial Officer

 

On March 25, 2019, the Company entered into a one-year employment agreement with its Chief Financial Officer (“CFO”) that will be renewed automatically for successive one-year periods, unless the Company or CFO provides a notice of non-renewal at least thirty (30) days prior to the end of the term. In the event that coincident with or following a Change in Control (as defined in the agreement), the CFO’s employment with the Company is terminated or the employment agreement is not extended (a) by action of the CFO coincident with or following a Change in Control including the CFO’s death, disability or retirement, or (b) by action of the Company not For Cause (as defined in the agreement) coincident with or following a Change in Control, the Company shall pay the CFO a severance payment equal to 50% of the base salary in the preceding calendar year, payable over six months, as well as certain other specified benefits. In connection with the employment agreement, the CFO was entitled to 50,000 shares of immediately-vested common stock. As of March 31, 2019, and through the date of filing, the Company has not issued the shares and, as a result, has accrued approximately $3,000 for this obligation on the condensed consolidated balance sheet as of March 31, 2019.

v3.19.1
Subsequent Events
3 Months Ended
Mar. 31, 2019
Subsequent Events [Abstract]  
Subsequent Events

8. Subsequent Events

 

Receivables

 

Subsequent to March 31, 2019, Dr. Wachter reduced his portion of legal fees and other expenses incurred by the Company under the Stipulated Settlement Agreement and Mutual Release in the Kleba shareholder derivative lawsuit by offsetting accrued payroll owed by the Company to him totaling $90,066.

v3.19.1
Significant Accounting Policies (Policies)
3 Months Ended
Mar. 31, 2019
Accounting Policies [Abstract]  
Leases

Leases

 

In February 2016, the Financial Accounting Standards Board (“FASB”) issued a new standard related to leases to increase transparency and comparability among organizations by requiring the recognition of operating lease right-of-use (“ROU”) assets and lease liabilities on the balance sheet (“ASC 842”) with amendments issued in 2018. Most prominent among the changes in the standard is the recognition of ROU assets and lease liabilities by lessees for those leases classified as operating leases. Under the standard, disclosures are required to meet the objective of enabling users of financial statements to assess the amount, timing, and uncertainty of cash flows arising from leases. The Company is also required to recognize and measure new leases at the adoption date and recognize a cumulative-effect adjustment in the period of adoption using a modified retrospective approach, with certain practical expedients available.

 

The Company adopted ASC 842 effective January 1, 2019 and elected to apply the available practical. The standard had an impact on the Company’s condensed consolidated balance sheets but did not have a material impact on the Company’s condensed consolidated statements of operations or condensed consolidated statements of cash flows upon adoption. The most significant impact was the recognition of ROU assets and lease liabilities for operating leases, while the Company’s accounting for finance leases remained substantially unchanged. The adoption of ASC 842 did not have a material impact in the current year and prior year comparative periods and as a result, a cumulative-effect adjustment was not required.

Reclassifications

Reclassifications 

 

Certain prior year balances have been reclassified in order to conform to current year presentation. These reclassifications have no effect on previously reported results of operations or loss per share.

v3.19.1
Leases (Tables)
3 Months Ended
Mar. 31, 2019
Leases [Abstract]  
Schedule of Right-of-use Assets and Liabilities

A summary of the Company’s right-of-use assets and liabilities is as follows:

 

    Three Months Ended
March 31, 2019
 
       
Cash paid for amounts included in the measurement of lease liabilities:        
Operating cash flows from operating leases   $ 22,001  
         
Right-of-use assets obtained in exchange for lease obligations:        
Operating leases   $ 265,550  
         
Weighted Average Remaining Lease Term        
Operating leases     3.25 years  
         
Weighted Average Discount Rate        
Operating leases     8.0 %
Schedule of Future Minimum Payments Under Non-cancellable Lease

Future minimum payments under non-cancellable lease as of March 31, 2019 were as follows:

 

For the Years Ending December 31,   Amount  
       
2019   $ 66,883  
2020     90,666  
2021     92,471  
2022     46,687  
Total future minimum lease payments     296,707  
Less: amount representing imputed interest     (35,668 )
Total   $ 261,039  

v3.19.1
Liquidity and Going Concern (Details Narrative) - USD ($)
Mar. 31, 2019
Dec. 31, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]    
Cash and cash equivalents $ 1,767,900 $ 50,986
v3.19.1
Convertible Notes Payable (Details Narrative) - USD ($)
3 Months Ended
Mar. 31, 2019
Mar. 23, 2017
PRH Note [Member] | Accredited Investors [Member]    
Related Party Transaction [Line Items]    
Debt principal amount $ 3,775,000  
Borrowed outstanding convertible notes payable 10,837,000  
PRH Note [Member] | Related Party [Member]    
Related Party Transaction [Line Items]    
Debt principal amount 25,000  
Borrowed outstanding convertible notes payable 6,895,000  
2017 Financing [Member]    
Related Party Transaction [Line Items]    
Loans received in connection with financing $ 17,732,000  
2017 Financing [Member] | Minimum [Member]    
Related Party Transaction [Line Items]    
Financing arrangement amount   $ 10,000,000
2017 Financing [Member] | Maximum [Member]    
Related Party Transaction [Line Items]    
Financing arrangement amount   $ 20,000,000
v3.19.1
Stockholders' Deficiency (Details Narrative) - Warrant Holders [Member]
3 Months Ended
Mar. 31, 2019
USD ($)
$ / shares
shares
Class of Stock [Line Items]  
Warrant to purchase common stock 100,000
Warrant exercise price | $ / shares $ 0.0533
Aggregate cash proceeds | $ $ 5,330
Number of common stock issued during period 100,000
v3.19.1
Leases (Details Narrative)
3 Months Ended
Mar. 31, 2019
USD ($)
ft²
Mar. 31, 2018
USD ($)
Lease rent expense $ 34,806 $ 22,153
Research and Development Expense [Member]    
Lease rent expense 23,204 14,768
General and Administrative Expense [Member]    
Lease rent expense $ 11,602 $ 7,385
Knoxville, Tennessee [Member]    
Area of land | ft² 4,500  
Lease term 5 years  
Lease expiration date Jun. 30, 2022  
Knoxville, Tennessee [Member] | Minimum [Member]    
Leases payments range per month $ 7,300  
Knoxville, Tennessee [Member] | Maximum [Member]    
Leases payments range per month $ 7,800  
v3.19.1
Leases - Schedule of Right-of-use Assets and Liabilities (Details)
3 Months Ended
Mar. 31, 2019
USD ($)
Leases [Abstract]  
Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 22,001
Right-of-use assets obtained in exchange for lease obligations: Operating leases $ 265,550
Weighted Average Remaining Lease Term: Operating leases 3 years 2 months 30 days
Weighted Average Discount Rate: Operating leases 8.00%
v3.19.1
Leases - Schedule of Future Minimum Payments Under Non-cancellable Lease (Details)
Mar. 31, 2019
USD ($)
Leases [Abstract]  
2019 $ 66,883
2020 90,666
2021 92,471
2022 46,687
Total future minimum lease payments 296,707
Less: amount representing imputed interest (35,668)
Total $ 261,039
v3.19.1
Commitments (Details Narrative) - USD ($)
1 Months Ended
Mar. 25, 2019
Dec. 12, 2017
Dec. 31, 2016
Dec. 27, 2016
Jan. 31, 2018
Mar. 31, 2019
Dec. 31, 2018
Company received the payment         $ 152,376    
Reserves on lawsuits settlement           $ 2,051,083 $ 2,051,083
Loss contingency accrual           $ 3,000  
Peter Culpepper [Member]              
Reimbursement expense       $ 294,255      
Recover from reimbursement expense       $ 294,255      
Disgorgement pay   $ 140,115          
Prejudgment interest   12,261          
Company received the payment   $ 152,376          
Lawsuit settlement     $ 2,240,000        
Litigation cost     $ 227,750        
CFO [Member]              
Severance base salary description The Company shall pay the CFO a severance payment equal to 50% of the base salary in the preceding calendar year, payable over six months, as well as certain other specified benefits.            
Severance payment base salary percentage 50.00%            
Number of common stock immediately vested 50,000            
v3.19.1
Subsequent Events (Details Narrative)
Mar. 31, 2019
USD ($)
Subsequent to March 31, 2019 [Member | Dr. Wachter [Member]  
Accrued payroll $ 90,066