Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Dec. 31, 2019 | Feb. 14, 2020 | |
Document And Entity Information | ||
Entity Registrant Name | PREDICTIVE TECHNOLOGY GROUP, INC. | |
Entity Central Index Key | 0001382943 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Dec. 31, 2019 | |
Current Fiscal Year End Date | --06-30 | |
Is Entity's Reporting Status Current? | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Is Entity Emerging Growth Company? | false | |
Entity Common Stock, Shares Outstanding | 295,936,766 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2020 | |
Entity Shell Company | false | |
Entity Interactive Data Current | Yes | |
Entity Incorporation, State or Country Code | NV | |
Entity File Number | 000-56008 |
UNAUDITED CONDENSED CONSOLIDATE
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) | Dec. 31, 2019 | Jun. 30, 2019 |
Current assets: | ||
Cash | $ 255,502 | $ 1,618,244 |
Accounts receivable, net of allowance for doubtful accounts of $864,331 and $687,064 | 437,377 | 1,250,476 |
Due from equity method investee | 184,443 | |
Inventory | 3,845,101 | 5,775,185 |
Other current assets | 217,224 | 103,080 |
Total current assets | 4,755,204 | 8,931,428 |
Fixed assets, net of depreciation | 6,156,360 | 6,974,441 |
Operating lease right of use assets | 1,528,163 | |
License agreements, net of amortization | 17,063,522 | 18,062,315 |
Patents, net of amortization | 6,468,137 | 6,850,490 |
Trade secrets, net of amortization | 42,307,169 | 45,336,335 |
Other intangible assets, net of amortization | 337,526 | 383,931 |
Equity method investments | 35,329,167 | 51,717,719 |
Goodwill | 5,254,451 | 5,254,451 |
Other long-term assets | 14,543 | 67,075 |
Total assets | 119,214,242 | 143,578,185 |
Current liabilities: | ||
Accounts payable | 3,823,829 | 4,943,178 |
Accrued liabilities | 1,931,818 | 1,857,771 |
Deferred revenue | 512,280 | 469,376 |
Operating lease liability, current portion | 859,442 | |
Finance lease liability, current portion | 646,020 | 504,488 |
Subscription payable, current portion | 2,155,000 | 6,300,000 |
Total current liabilities | 9,928,389 | 14,074,813 |
Operating lease liability | 714,713 | |
Finance lease liability | 1,189,104 | 1,511,554 |
Subscription payable | 7,531,610 | 4,040,610 |
Notes payable | 10,080,000 | 400,000 |
Deferred tax liabilities | 1,536,445 | 11,014,745 |
Total liabilities | 30,980,261 | 31,041,722 |
Stockholders' equity: | ||
Common stock, par value $0.001, 282,985,560 and 273,761,955 shares issued and outstanding at December 31, 2019 and June 30, 2019; 900,000,000 shares authorized | 282,986 | 273,762 |
Additional paid-in capital | 163,224,275 | 153,604,830 |
Accumulated deficit | (74,970,125) | (41,102,849) |
Total controlling interest | 88,537,136 | 112,775,743 |
Non-controlling interest | (303,155) | (239,280) |
Total stockholders' equity | 88,233,981 | 112,536,463 |
Total liabilities and stockholders' equity | $ 119,214,242 | $ 143,578,185 |
UNAUDITED CONDENSED CONSOLIDA_2
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) | Dec. 31, 2019 | Jun. 30, 2019 |
Statement of Financial Position [Abstract] | ||
Allowance for Doubtful Accounts | $ 864,331 | $ 687,064 |
Common stock, par value per share | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 900,000,000 | 900,000,000 |
Common stock, shares issued | 282,985,560 | 273,761,955 |
Common stock, shares outstanding | 282,985,560 | 273,761,955 |
UNAUDITED CONDENSED CONSOLIDA_3
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS - USD ($) | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income Statement [Abstract] | ||||
Revenue | $ 7,336,640 | $ 10,687,036 | $ 15,595,898 | $ 18,750,838 |
Cost of goods sold, exclusive of depreciation & amortization shown below | 5,840,256 | 3,059,136 | 13,022,246 | 6,107,692 |
Operating expenses: | ||||
Selling and marketing | 3,049,593 | 3,431,157 | 6,201,563 | 5,838,593 |
General and administrative | 7,034,770 | 2,878,614 | 13,413,647 | 5,544,762 |
Research and development | 2,364,350 | 1,759,560 | 4,192,700 | 2,365,644 |
Depreciation and amortization | 2,775,073 | 2,035,360 | 5,385,318 | 3,701,082 |
Total operating expenses | 15,223,786 | 10,104,691 | 29,193,228 | 17,450,081 |
Operating loss | (13,727,402) | (2,476,791) | (26,619,576) | (4,806,935) |
Loss on equity method investment | (16,249,252) | (600,116) | (16,388,552) | (914,898) |
Interest income (expense) | (297,736) | 489 | (371,218) | 912 |
Total other loss | (16,546,988) | (599,627) | (16,759,770) | (913,986) |
Loss before income taxes | (30,274,390) | (3,076,418) | (43,379,346) | (5,720,921) |
Benefit from income taxes | 4,239,780 | 713,526 | 9,448,195 | 1,325,978 |
Net loss & comprehensive loss | (26,034,610) | (2,362,892) | (33,931,151) | (4,394,943) |
Net loss non-controlling interest | (31,941) | (33,454) | (63,875) | (61,123) |
Net loss attributable to common shareholders | $ (26,002,669) | $ (2,329,438) | $ (33,867,276) | $ (4,333,820) |
Weighted average common shares outstanding, basic & diluted | 283,126,298 | 263,278,417 | 282,203,748 | 258,672,982 |
Basic & diluted loss per share attributable to common shareholders | $ (0.09) | $ (0.01) | $ (0.12) | $ (0.02) |
UNAUDITED CONDENSED CONSOLIDA_4
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 6 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Cash flows from operating activities: | ||
Net loss | $ (33,931,151) | $ (4,394,943) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||
Depreciation and amortization | 5,385,318 | 3,700,091 |
Provision for bad debts | 177,560 | |
Share based compensation | 9,628,669 | 1,982,854 |
Deferred income taxes | (9,478,300) | (1,325,978) |
Non-cash lease expense | 329,515 | |
Losses on equity method investment | 16,388,552 | 914,898 |
Changes in operating assets and liabilities: | ||
Accounts receivable | 635,982 | (29,650) |
Inventory | 1,930,084 | (121,072) |
Prepaid expenses | (114,144) | (21,309) |
Other assets | 52,532 | (6,569) |
Accounts Payable | (707,469) | 1,345,996 |
Accrued liabilities | 74,047 | 14,315 |
Operating lease liability | (329,067) | |
Deferred Revenue | 42,904 | |
Net cash provided by (used in) operating activities | (9,914,968) | 2,058,633 |
Cash flows from investing activities: | ||
Purchases of property and equipment | (476,856) | (1,204,756) |
Cash acquired from acquisitions, net | 799,980 | |
Cash payments on equity method investee stock subscription | (470,000) | (1,184,392) |
Capitalization of patent acquisition costs | (140,675) | |
Net cash used in investing activities | (946,856) | (1,729,843) |
Cash flows from financing activities: | ||
Cash proceeds from stock subscriptions | 1,025,000 | |
Proceeds from issuance of promissory notes and borrowings on revolving line of credit | 9,680,000 | |
Principal payments on finance leases | (180,918) | |
Net cash provided by financing activities | 9,499,082 | 1,025,000 |
Net increase (decrease) in cash and cash equivalents | (1,362,742) | 1,353,790 |
Cash and cash equivalents at the beginning of the period | 1,618,244 | 1,206,139 |
Cash and cash equivalents at the end of the period | 255,502 | 2,559,929 |
Warrants issued for trade secrets | 13,860,000 | |
Common stock issued for the acquisition of InceptionDX, LLC | 14,260,000 | |
Revaluation of warrants issued for licenses | (4,449,213) | |
Reduction in number of equity method investee units subscribed | (1,850,000) | |
Common stock issued and deferred tax liabilities assumed for the acquisition of Regenerative Medical Technologies, Inc. | 12,266,667 | |
Right-of-use assets obtained in exchange for new operating lease liabilities | $ 1,903,222 |
UNAUDITED CONDENSED CONSOLIDA_5
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) | Common Stock [Member] | Additional Paid in Capital [Member] | Subscription Receivable [Member] | Non-Controlling Interest [Member] | Accumulated Deficit [Member] | Total |
Balance at Jun. 30, 2018 | $ 247,624 | $ 108,049,300 | $ (1,025,000) | $ (120,152) | $ (25,813,957) | $ 81,337,815 |
Balance, shares at Jun. 30, 2018 | 247,624,069 | |||||
Common stock issued for acquisition of InceptionDX, LLC | $ 15,500 | 14,244,500 | 14,260,000 | |||
Common stock issued for acquisition of InceptionDX, LLC, shares | 15,500,000 | |||||
Common stock issued for services | $ 50 | 43,450 | 43,500 | |||
Common stock issued for services, shares | 50,000 | |||||
Common stock cancelled | $ (1,200) | 1,200 | ||||
Common stock cancelled, shares | (1,200,000) | |||||
Warrants issued for trade secrets | 13,860,000 | 13,860,000 | ||||
Cash received from common stock subscriptions | 325,000 | 325,000 | ||||
Share based compensation | 928,846 | 928,846 | ||||
Net loss | (27,669) | (2,004,382) | (2,032,051) | |||
Balance at Sep. 30, 2018 | $ 261,974 | 137,127,296 | (700,000) | (147,821) | (27,818,339) | 108,723,110 |
Balance, shares at Sep. 30, 2018 | 261,974,069 | |||||
Balance at Jun. 30, 2018 | $ 247,624 | 108,049,300 | (1,025,000) | (120,152) | (25,813,957) | 81,337,815 |
Balance, shares at Jun. 30, 2018 | 247,624,069 | |||||
Common stock issued for acquisition of InceptionDX, LLC | 14,260,000 | |||||
Revaluation of warrants issued for license agreements | (4,449,213) | |||||
Net loss | (4,394,943) | |||||
Balance at Dec. 31, 2018 | $ 271,974 | 142,878,590 | (181,275) | (30,147,777) | 112,821,512 | |
Balance, shares at Dec. 31, 2018 | 271,974,069 | |||||
Balance at Sep. 30, 2018 | $ 261,974 | 137,127,296 | (700,000) | (147,821) | (27,818,339) | 108,723,110 |
Balance, shares at Sep. 30, 2018 | 261,974,069 | |||||
Common stock issued for acquisition of Regenerative Medical Technologies, Inc. | $ 10,000 | 9,190,000 | 9,200,000 | |||
Common stock issued for acquisition of Regenerative Medical Technologies, Inc., shares | 10,000,000 | |||||
Cash received from common stock subscriptions | 700,000 | 700,000 | ||||
Share based compensation | 1,010,505 | 1,010,505 | ||||
Revaluation of warrants issued for license agreements | (4,449,211) | (4,449,211) | ||||
Net loss | (33,454) | (2,329,438) | (2,362,892) | |||
Balance at Dec. 31, 2018 | $ 271,974 | 142,878,590 | (181,275) | (30,147,777) | 112,821,512 | |
Balance, shares at Dec. 31, 2018 | 271,974,069 | |||||
Balance at Jun. 30, 2019 | $ 273,762 | 153,604,830 | (239,280) | (41,102,849) | 112,536,463 | |
Balance, shares at Jun. 30, 2019 | 273,761,955 | |||||
Share based compensation | 4,994,600 | 4,994,600 | ||||
Cashless exercise of warrants | $ 9,224 | (9,224) | ||||
Cashless exercise of warrants, shares | 9,223,605 | |||||
Net loss | (31,934) | (7,864,607) | (7,896,541) | |||
Balance at Sep. 30, 2019 | $ 282,986 | 158,590,206 | (271,214) | (48,967,456) | 109,634,522 | |
Balance, shares at Sep. 30, 2019 | 282,985,560 | |||||
Balance at Jun. 30, 2019 | $ 273,762 | 153,604,830 | (239,280) | (41,102,849) | 112,536,463 | |
Balance, shares at Jun. 30, 2019 | 273,761,955 | |||||
Common stock issued for acquisition of InceptionDX, LLC | ||||||
Revaluation of warrants issued for license agreements | ||||||
Net loss | (33,931,151) | |||||
Balance at Dec. 31, 2019 | $ 282,986 | 163,224,275 | (303,155) | (74,970,125) | 88,233,981 | |
Balance, shares at Dec. 31, 2019 | 282,985,560 | |||||
Balance at Sep. 30, 2019 | $ 282,986 | 158,590,206 | (271,214) | (48,967,456) | 109,634,522 | |
Balance, shares at Sep. 30, 2019 | 282,985,560 | |||||
Share based compensation | 4,634,069 | 4,634,069 | ||||
Net loss | (31,941) | (26,002,669) | (26,034,610) | |||
Balance at Dec. 31, 2019 | $ 282,986 | $ 163,224,275 | $ (303,155) | $ (74,970,125) | $ 88,233,981 | |
Balance, shares at Dec. 31, 2019 | 282,985,560 |
BUSINESS DESCRIPTION AND SIGNIF
BUSINESS DESCRIPTION AND SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Dec. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
BUSINESS DESCRIPTION AND SIGNIFICANT ACCOUNTING POLICIES | NOTE 1- BUSINESS DESCRIPTION AND SIGNIFICANT ACCOUNTING POLICIES BUSINESS DESCRIPTION: Predictive Technology Group, Inc., together with its subsidiaries (collectively, PTG, Predictive or the Company), develops and commercializes discoveries and technologies involved in novel molecular diagnostic, therapeutic, and Human Cellular and Tissue-Based Products (HCT/Ps). The Company uses this information as the cornerstone in the development of new diagnostics that assess a persons risk of disease and develop pharmaceutical therapeutics and HCT/Ps for use by healthcare professionals to improve outcomes in their patients. The Companys corporate headquarters are located in Salt Lake City, Utah. SEGMENT INFORMATION Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision-maker (CODM) in making decisions regarding resource allocation and assessing performance. The Company operates in two reportable segments, which are differentiated by product. The HCT/P segment offers minimally manipulated tissue products intended for homologous use, prepared utilizing proprietary extraction methods that reduce the loss of important scaffolding, growth factors and cytokines. The Companys Diagnostics and Therapeutics segment uses data analytics for disease identification and subsequent therapeutic intervention through novel gene-based diagnostics, and companion therapeutics. Lastly, the Unallocated Corporate column in the table below represents those headquarters activities that do not qualify as operating segments and which are not allocated to operating segments in information provided to the CODM. We currently sell our products exclusively in the United States. During the fourth quarter of 2019, we realigned our segment reporting to separately present headquarters costs in information available to the CODM. The presentation of the comparative information has been recast to conform to the 2019 presentation. Segment revenue and operating income (loss) HCT/Ps Diagnostics & Therapeutics Unallocated Corporate Total Three months ended December 31, 2019 Revenues $ 7,289,265 $ 47,375 $ - $ 7,336,640 Depreciation and amortization 937,923 1,756,560 80,590 2,775,073 Share based compensation 1,242,875 254,353 3,136,841 4,634,069 Segment operating loss (7,067,094) (3,261,117) (3,399,191) (13,727,402) Three months ended December 31, 2018 Revenues $ 10,687,036 $ - $ - $ 10,687,036 Depreciation and amortization 771,416 1,181,317 82,627 2,035,360 Share based compensation 316,089 8,186 686,230 1,010,505 Segment operating loss (507,527) (1,249,673) (719,591) (2,476,791) Six months ended December 31, 2019 Revenues $ 15,473,896 $ 122,002 $ - $ 15,595,898 Depreciation and amortization 1,836,868 3,387,858 160,592 5,385,318 Share based compensation 2,914,331 704,454 6,009,884 9,628,669 Segment operating loss (13,611,080) (6,489,756) (6,518,740) (26,619,576) Six months ended December 31, 2018 Revenues $ 18,750,838 $ - $ - $ 18,750,838 Depreciation and amortization 1,512,884 2,012,840 175,358 3,701,082 Share based compensation 371,838 8,186 1,602,830 1,982,854 Segment operating loss (838,369) (2,216,214) (1,752,352) (4,806,935) Three months ended December 31, Six months ended December 31, 2019 2018 2019 2018 Total operating loss for reportable segments $ (10,328,211) $ (1,757,200) $ (20,100,836) $ (3,054,583) Unallocated amounts: Unallocated Corporate (3,399,191) (719,591) (6,518,740) (1,752,352) Other loss (16,546,988) (599,627) (16,759,770) (913,986) Loss before income taxes $ (30,274,390) $ (3,076,418) $ (43,379,346) $ (5,720,921) As of December 31, As of June 30, Total Assets 2019 2019 HCT/Ps $ 16,302,925 $ 21,052,082 Diagnostics and therapeutics 101,442,833 120,665,445 Unallocated corporate 1,468,484 1,860,658 Total Assets $ 119,214,242 $ 143,578,185 BASIS OF PRESENTATION: The accompanying consolidated financial statements have been prepared by Predictive Technology Group, Inc. (the Company or Predictive) in accordance with U.S. generally accepted accounting principles (GAAP) for financial information and pursuant to the applicable rules and regulations of the Securities and Exchange Commission (SEC). The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. In the opinion of management, the accompanying financial statements contain all adjustments (consisting of normal and recurring accruals) necessary to present fairly all financial statements in accordance with U.S. GAAP. The condensed consolidated financial statements herein should be read in conjunction with the Companys audited consolidated financial statements and notes thereto for the fiscal year ended June 30, 2019, included in the Companys Annual Report on Form 10-K for the fiscal year ended June 30, 2019. Operating results for the three and six months ended December 31, 2019 may not necessarily be indicative of results to be expected for any other interim period or for the full fiscal year. Fiscal Year End The Company operates on a fiscal year basis with the fiscal year ending on June 30. Consolidation These consolidated financial statements include the financial statements of Predictive Technology Group, Inc. and its wholly owned subsidiaries. All inter-company accounts and transactions have been eliminated in consolidation. Cash Equivalents The Company considers all highly-liquid investments with a maturity of three months or less, when purchased, to be cash equivalents. The Company places its temporary cash investments with high-quality financial institutions. Going Concern The accompanying financial statements have been prepared under the assumption that the Company will continue to operate as a going concern, which contemplates the realization of assets and the settlement of liabilities in the normal course of business. The condensed consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts of liabilities that may result from any inability of the Company to continue as a going concern. The Company incurred a net loss of $33,867,276 for the six months ended December 31, 2019 and net cash outflows from operations of $9,914,968. At December 31, 2019, the Company had $255,502 of cash and negative working capital of $4,861,267. The Company's historical and current use of cash in operations combined with limited liquidity resources raise substantial doubt regarding the Companys ability to continue as a going concern. Management may seek additional capital through debt financings, collaborative or other funding arrangements with partners, or through other sources of financing. Should the Company seek additional financing from outside sources, the Company may not be able to raise such financing on terms acceptable to the Company or at all. If the Company is unable to raise additional capital when required or on acceptable terms, this could have a material adverse effect on liquidity. In such a case, the Company may be required to scale back or to discontinue the promotion of currently available products, scale back or discontinue the advancement of product candidates, reduce headcount, file for bankruptcy, reorganize, merge with another entity, or cease operations. Trade Accounts Receivable and Allowance for Doubtful Accounts Trade accounts receivable are primarily comprised of amounts due from sales of the Companys HCT/P products that are recorded at the invoiced amount, and deposits in transit from credit card processors. The allowance for doubtful accounts is based on the Companys best estimate of the amount of probable losses in the Companys existing accounts receivable, which is based on historical write-off experience, customer creditworthiness, facts and circumstances specific to outstanding balances, and payment terms. Account balances are charged against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. The Company does not have any off-balance-sheet credit exposure related to its customers and does not require collateral. Inventories Inventories consist primarily of HCT/Ps produced by Predictive Biotech, Inc. ("Predictive Biotech"), a wholly owned subsidiary and laboratory supplies used in genetic testing performed by Predictive Laboratories, Inc. ("Predictive Labs"). We value inventory at the lower of cost or net realizable value. We determine the cost of inventory using the standard cost method, which approximates actual cost based on a first-in, first-out method. All other costs, including administrative costs, are expensed as incurred. We analyze our inventory levels at least quarterly and write down inventory that has a cost basis in excess of its expected net realizable value, or that is considered in excess of normal operating levels, as determined by management. We also reserve for the quantity of quarantined (WIP) inventory that is not expected to pass quality control based on historical averages. The related costs are recognized as cost of goods sold in the consolidated statements of operations. Stock Subscriptions Receivable Stock subscriptions are recorded as contra-equity on the day the subscription agreement is signed and accepted by the Company. As of December 31, 2019 and June 30, 2019, all stock subscribed has been fully paid. Prepaid Expenses Amounts paid in advance for expenses are accounted for as prepaid expenses and classified as current assets if such amounts are to be recognized as expense within one year from the balance sheet date. Property, Plant and Equipment Lab equipment, furniture and computer equipment are stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method based on the lesser of estimated useful lives of the related assets or the underlying lease term. Lab equipment items have depreciable lives of 5 years, furniture items have depreciable lives of 5 to 7 years, and computer equipment items have depreciable lives of 3 years. Repair and maintenance costs are charged to expense as incurred. Amortization of assets recorded under finance leases is included in depreciation expense. The Company reviews property and equipment for impairment. Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. Recoverability of these assets is measured by comparison of their carrying amounts to future undiscounted cash flows the assets are expected to generate. If property and equipment are considered to be impaired, the impairment to be recognized equals the amount by which the carrying value of the assets exceeds its fair market value. Leases We have entered into operating and finance lease agreements primarily for office and laboratory facilities and laboratory equipment located in Salt Lake City, Utah with lease periods expiring between 2020 and 2022. We determine if an arrangement is a lease at inception. For all classes of underlying assets, we elect not to recognize right of use assets or lease liabilities when a lease has a lease term of 12 months or less at the commencement date and does not include an option to purchase the underlying asset that we are reasonably certain to exercise. Operating lease assets and liabilities are included on our consolidated balance sheet beginning July 1, 2019. Finance lease assets are included in property and equipment, net. Operating lease assets and liabilities are recognized at the present value of the future lease payments at the lease commencement date. The interest rate used to determine the present value of the future lease payments is our incremental borrowing rate, because the interest rate implicit in most of our leases is not readily determinable. Our incremental borrowing rate is estimated to approximate the interest rate on a collateralized basis with similar terms and payments, and in economic environments where the leased asset is located. Operating lease assets also include any prepaid lease payments and lease incentives. Our lease terms include periods under options to extend or terminate the lease when it is reasonably certain that we will exercise that option. We generally use the base, non-cancelable, lease term when determining the lease assets and liabilities. Operating lease expense is recognized on a straight-line basis over the lease term. Our lease agreements generally contain lease and non-lease components. Non-lease components primarily include payments for maintenance and utilities. We combine fixed payments for non-lease components with our lease payments and account for them together as a single lease component, which increases the amount of our lease assets and liabilities. Intangible Assets and Other Long-Lived Assets Intangible and other long-lived assets are comprised of acquired patents, licenses, trade secrets and other intellectual property. Acquired intangible assets are recorded at fair value and amortized over the shorter of the contractual life or the estimated useful life. The Company reviews definite-lived intangible assets for impairment. Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. Recoverability of these assets is measured by comparison of their carrying amounts to future undiscounted cash flows the assets are expected to generate. If identifiable intangibles are considered to be impaired, the impairment to be recognized equals the amount by which the carrying value of the assets exceeds its fair market value. Indefinite-lived intangible assets not subject to amortization are reviewed for impairment annually, typically at the beginning of the fourth fiscal quarter, or whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. Such events and circumstances may include sweeping regulatory changes, shifts in market demand that would negatively impact revenue, overall industry deterioration, dramatic increase in the number of competitors, rapidly increasing costs related to production inputs, significant changes in Company management or Company strategy, or significant litigation. The Company first assesses qualitative factors above to determine whether it is necessary to perform the quantitative impairment test to identify any impairment loss. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset or asset group to estimated future undiscounted net cash flows, or fair value, of the related asset or group of assets over their remaining lives. Certain of the Companys patents are currently subject to litigation (see Note 14) to determine whether the seller of the patents had satisfactory title to the patents that were then sold to the Company. These patents have a carrying value of $6,468,137 on our consolidated balance sheet as of December 31, 2019. While the litigation is in its early stages and may reach a broad range of possible outcomes, we have determined that it is at least reasonably possible that the patents may become impaired in the near term depending on the information gained during the legal discovery process and the outcome of the litigation. The Company reviews equity method investments for impairment whenever events or changes in circumstances indicate that the carrying amount of the investment may not be recoverable in accordance with generally accepted accounting principles. This determination requires significant judgment. In making this judgment, the Company considers available quantitative and qualitative evidence in evaluating potential impairment of these investments. If it is determined that an indicator of impairment exists, the Company assesses whether the carrying value exceeds the fair value of the asset. If the carrying value of the investment exceeds its fair value, the Company will evaluate, among other factors, general market conditions, the duration and extent to which the carrying value is greater than the fair value, and the Companys intent and ability to hold, or plans to sell, the investment. The Company also considers specific adverse conditions related to the financial health of and business outlook for the investee, including industry and sector performance, changes in technology, and operational and financing cash flow factors. Once a decline in fair value is determined to be other-than-temporary, an impairment charge will be recorded and a new carrying basis in the investment will be established. The Company recorded an impairment charge of $15,932,016 related to our equity method investment in Juneau Biosciences, LLC (see Note 7). Revenue Recognition We derive our revenue primarily from sales of HCT/P products to clinicians. The majority of our contracts with customers have a single performance obligation, and all of our contracts with customers have a duration of less than one year. Revenue is recognized when control of the product passes to the customer, typically upon confirmation of delivery of the product to the customer. As our products must remain frozen during transit, we typically ship our products overnight. Revenue is recognized in an amount that reflects the expected consideration to be received in exchange for such goods or services. As such, customer orders are recorded as deferred revenue prior to delivery of products or services ordered. Generally, we require authorization from a credit card or verification of receipt of payment before we ship products to customers. From time to time we grant credit to our customers with normal credit terms (typically 30 days). We do not recognize assets associated with costs to obtain or fulfill a contract with a customer, as the amortization period for any such costs if capitalized would be one year or less. Shipping and handling is considered a fulfillment activity, as it takes place prior to the customer obtaining control of the product, and fees charged to customers are included in net revenue upon completion of our performance obligation. Shipping and handling expenses are included in cost of sales. We present revenue net of sales taxes, discounts, and expected returns. Deferred Revenue We recognize a contract liability when customer payment precedes the completion of our performance obligations. The following table provides information about deferred revenue from contracts with customers, including significant changes in deferred revenue balances during the period (in thousands). Amount Deferred revenue at June 30, 2019 $ 469,376 Increase due to deferral of revenue at period end 512,280 Decrease due to beginning contract liabilities recognized as revenue (469,376) Deferred revenue at December 31, 2019 $ 512,280 Research and Product Development Costs The Company expenses research and product development costs as incurred. Product Liability and Warranty Costs The Company maintains product liability insurance and has not experienced any related claims from its product offerings. The Company also offers a warranty to customers providing that its products will be delivered free of any material defects. There have been no material costs incurred since inception based on estimated return rates. The Company reviews the adequacy of its accrual on a quarterly basis. Income Taxes In order to determine the Companys quarterly provision for income taxes, the Company uses an estimated annual effective tax rate that is based on expected annual income and applicable federal and state tax rates. Deferred tax assets and liabilities are recorded to reflect the future tax consequences attributable to the effects of differences between the carrying amounts of existing assets and liabilities for financial reporting and for income tax purposes. Deferred taxes are calculated by applying enacted statutory tax rates and tax laws to future years in which temporary differences are expected to reverse. The impact on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that the rate change is enacted. Other Comprehensive Loss Comprehensive loss is comprised of net loss and other comprehensive loss. Other comprehensive loss is equal to net loss for the three and six months ended December 31, 2019 and 2018. Measurement of Fair Value The fair value of a financial instrument is the amount that could be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financial assets are marked to bid prices and financial liabilities are marked to offer prices. Fair value measurements do not include transaction costs. A fair value hierarchy is used to prioritize the quality and reliability of the information used to determine fair values. Categorization within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The fair value hierarchy is defined in the following three categories: Level 1: Quoted market prices in active markets for identical assets or liabilities. Level 2: Observable market-based inputs or inputs that are corroborated by market data. Level 3: Unobservable inputs that are not corroborated by market data. During the three and six months ended December 31, 2019 and 2018, we did not have any remeasurements of non-financial assets measured at fair value on a non-recurring basis subsequent to their initial recognition. Use of Estimates The preparation of financial statements in conformity with 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 sales and expenses during the reporting periods. Key estimates in the accompanying unaudited condensed consolidated financial statements include, among others, revenue recognition, allowances for doubtful accounts and product returns, provisions for obsolete inventory, valuation of long-lived assets, and deferred income tax asset valuation allowances. Actual results could differ materially from these estimates. Recently Issued Accounting Pronouncements In June 2016, the FASB issued ASU 2016-13, Financial Instruments Credit Losses (Topic 326) which introduces new guidance for the accounting for credit losses on instruments within its scope. The new guidance, as amended by subsequent ASUs, introduces an approach based on expected losses to estimate credit losses on certain types of financial instruments. For trade receivables, the Company will be required to use a forward-looking expected loss model rather than the incurred loss model for recognizing credit losses which reflects losses that are probable. For public business entities that meet the definition of a U.S. Securities and Exchange Commission (SEC) filer, excluding entities eligible to be smaller reporting companies as defined by the SEC, the amendments in this Update are effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. For all other entities, the amendments in this Update are effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. Early adoption is permitted. Application of the amendments is through a cumulative-effect adjustment to retained earnings as of the effective date. The Company is currently evaluating the impact of this update on the consolidated financial statements. In December 2019, the FASB issued ASU 2019-12, "Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes" (ASU 2019-12), which eliminates certain exceptions for recognizing deferred taxes for investments, performing intraperiod allocation and calculating income taxes in interim periods. This ASU also includes guidance to reduce complexity in certain areas, including recognizing deferred taxes for tax goodwill and allocating taxes to members of a consolidated group. ASU 2019-12 is effective for annual and interim periods in fiscal years beginning after December 15, 2020. Early adoption is permitted. The Company is currently assessing the impact of ASU 2019-12 on its consolidated financial statements. Recently Adopted Accounting Standards In February 2016, the FASB established Topic 842, Leases, by issuing Accounting Standards Update (ASU) No. 2016-02, which requires lessees to recognize leases on the balance sheet and disclose key information about leasing arrangements. Topic 842 was subsequently amended by ASU No. 2018-01, Land Easement Practical Expedient for Transition to Topic 842; ASU No. 2018-10, Codification Improvements to Topic 842, Leases; and ASU No. 2018-11, Targeted Improvements. The new standard establishes a right-of-use model (ROU) that requires a lessee to recognize a ROU asset and lease liability on the balance sheet for all leases with a term longer than 12 months. Leases are classified as finance or operating, with classification affecting the pattern and classification of expense recognition in the income statement. The new standard was effective for us on July 1, 2019. A modified retrospective transition approach is required, applying the new standard to all leases existing at the date of initial application. An entity may choose to use either (1) its effective date or (2) the beginning of the earliest comparative period presented in the financial statements as its date of initial application. If an entity chooses the second option, the transition requirements for existing leases also apply to leases entered into between the date of initial application and the effective date. The entity must also recast its comparative period financial statements and provide the disclosures required by the new standard for the comparative periods. We used the effective date as our date of initial application. Consequently, financial information was not updated, and the disclosures required under the new standard were not provided for dates and periods before July 1, 2019. The new standard provides a number of optional practical expedients in transition. We elected the package of practical expedients, which permits us not to reassess under the new standard our prior conclusions about lease identification, lease classification and initial direct costs. We elected all of the new standards available transition practical expedients that are applicable. The new standard also provides practical expedients for an entitys ongoing accounting. We elected the short-term lease recognition exemption for all leases that qualify. This means, for those leases that qualify, we will not recognize ROU assets or lease liabilities, and this includes not recognizing ROU assets or lease liabilities for existing short-term leases of those assets in transition. We also elected the practical expedient to not separate lease and non-lease components for all of our leases, other than for leases of real estate. |
CORRECTION OF PREVIOUSLY-ISSUED
CORRECTION OF PREVIOUSLY-ISSUED UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS | 6 Months Ended |
Dec. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
CORRECTION OF PREVIOUSLY-ISSUED UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS | NOTE 2 CORRECTION OF PREVIOUSLY-ISSUED UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS Subsequent to the issuance of the Company's condensed consolidated financial statements for the three and six months ended December 31, 2018, the Company discovered (i) an error in the Company's accounting for income taxes, primarily with regard to the impact of income taxes on the Company's accounting for business combinations and asset acquisitions, and (ii) a clerical error in the calculation of volatility used as an input to the Black-Scholes model used to value the warrants issued as consideration for the acquisition of certain intellectual property. As a result, the Company has corrected the accompanying condensed consolidated statements of operations and comprehensive loss and the statements of stockholders' equity for the three and six months ended December 31, 2018 from amounts previously reported to (i) record a benefit from income taxes of $713,526 and $1,325,978 for the three and six months, respectively, and (ii) record $358,333 and $632,233 in share based compensation expense for the three and six months, respectively , and (iii) record amortization expense related to intangible assets by $42,826 and $36,118 for the three and six months, respectively. Additionally, the Company identified the following errors in the calculation of weighted average shares outstanding underlying the calculation of earnings per share for the three and six months ended December 31, 2018. Common shares in the amount of 23,127,666 issued prior to the 2017 fiscal year were thought to have been cancelled, when in fact they remain legally outstanding. The weighted average shares outstanding used to calculate earnings per share were also calculated incorrectly, such that the total corrected weighted average shares outstanding increased by 33,167,000 and 28,561,565 for the three and six months, respectively, from amounts previously reported. The error did not affect reported earnings per share in any period. The condensed consolidated statement of cash flows for the six months ended December 31, 2018 has also been corrected for the adjustments to the condensed consolidated statement of operations discussed above, and to correct the presentation of certain investing and financing activities as follows. First, cash acquired from the acquisition of InceptionDX, LLC was reclassified from financing to investing activities. Second, the amount of cash paid under our subscription payable previously incorrectly reported as $1,142,089 and incorrectly included in financing activities. The cash paid under our subscription has been corrected to $1,184,392 by reclassifying certain immaterial noncash activity to operating activities and has been reclassified to investing activities. In addition to the impact of the corrections described above, the condensed consolidated statements of operations for the six months ended December 31, 2018 includes certain insignificant corrections in presentation that were made to conform to the fiscal 2019 annual financial statements. The following tables present the effects of the corrections to the condensed consolidated statements of operations and comprehensive loss for the three and six months ended December 31, 2018 and the statement of cash flows for the six months ended December 31, 2018. Unaudited consolidated statement of operations Three months ended December 31, 2018 (As reported) (Adjustment) (Restated) Revenue from operations (net) $ 10,687,036 $ - $ 10,687,036 Cost of goods sold, exclusive of depreciation & amortization shown below 3,059,136 - 3,059,136 Selling and marketing 3,431,157 - 3,431,157 General and administrative 2,520,281 358,333 2,878,614 Research and development 1,759,560 - 1,759,560 Depreciation and amortization 1,992,534 42,826 2,035,360 Total operating expense 9,703,532 401,159 10,104,691 Loss from operations (2,075,632) (401,159) (2,476,791) Other loss (599,627) - (599,627) Loss before income taxes (2,675,259) (401,159) (3,076,418) Benefit from income taxes - 713,526 713,526 Net loss (2,675,259) 312,367 (2,362,892) Net loss non-controlling interest (33,454) - (33,454) Net loss controlling interest $ (2,641,805) $ 312,367 $ (2,329,438) Loss per common share Basic and diluted $ (0.01) $ - $ (0.01) Average common shares Basic and diluted 230,111,417 33,167,000 263,278,417 Six months ended December 31, 2018 (As reported) (Adjustment) (Restated) Revenue from operations (net) $ 18,750,838 $ - $ 18,750,838 Cost of goods sold, exclusive of depreciation & amortization shown below 5,925,871 181,821 6,107,692 Selling and marketing 5,853,876 (15,283) 5,838,593 General and administrative 5,079,761 465,001 5,544,762 Research and development 2,364,950 694 2,365,644 Depreciation and amortization 3,664,964 36,118 3,701,082 Total operating expense 16,963,551 486,530 17,450,081 Loss from operations (4,138,584) (668,351) (4,806,935) Other loss (913,986) - (913,986) Loss before income taxes (5,052,570) (668,351) (5,720,921) Benefit from income taxes - 1,325,978 1,325,978 Net loss (5,052,570) 657,627 (4,394,943) Net loss non-controlling interest (61,123) - (61,123) Net loss controlling interest $ (4,991,447) $ 657,627 $ (4,333,820) Loss per common share Basic and diluted $ (0.02) $ - $ (0.02) Average common shares Basic and diluted 230,111,417 28,561,565 258,672,982 Unaudited consolidated statement of cash flows Six months ended December 31, 2018 (As reported) (Adjustment) (Restated) Cash flows from operating activities: Net loss $ (5,052,570) $ 657,627 $ (4,394,943) Adjustments to reconcile net loss to net cash provided by operating activities: Depreciation and amortization 3,663,973 36,118 3,700,091 Share based compensation 1,308,318 674,536 1,982,854 Deferred income taxes - (1,325,978) (1,325,978) Losses on equity method investment 914,898 - 914,898 Changes in operating assets and liabilities: Accounts receivable (29,650) - (29,650) Inventory (121,072) - (121,072) Prepaid expenses (21,309) - (21,309) Other assets (6,569) - (6,569) Accounts payable 1,345,996 - 1,345,996 Accrued liabilities 14,315 - 14,315 Net cash provided by operating activities 2,016,330 42,303 2,058,633 Cash flows from investing activities: Purchases of property and equipment (1,204,756) - (1,204,756) Cash acquired from acquisitions, net - 799,980 799,980 Cash payments on stock subscription - (1,184,392) (1,184,392) Capitalization of patent acquisition costs (140,675) - (140,675) Net cash used in investing activities (1,345,431) (384,412) (1,729,843) Cash flows from financing activities: Cash proceeds from stock subscriptions 1,025,000 - 1,025,000 Cash acquired from acquisitions, net 799,980 (799,980) - Cash payments on stock subscription (1,142,089) 1,142,089 - Net cash provided by financing activities 682,891 342,109 1,025,000 Net increase in cash and cash equivalents 1,353,790 - 1,353,790 Cash and cash equivalents at the beginning of the period $ 1,206,139 $ - $ 1,206,139 Cash and cash equivalents at the end of the period $ 2,559,929 $ - $ 2,559,929 |
BUSINESS COMBINATIONS AND ASSET
BUSINESS COMBINATIONS AND ASSET ACQUISITIONS | 6 Months Ended |
Dec. 31, 2019 | |
Business Combinations [Abstract] | |
BUSINESS COMBINATIONS AND ASSET ACQUISITIONS | NOTE 3 BUSINESS COMBINATIONS AND ASSET ACQUISITIONS Inception DX, LLC On August 22, 2018, the Company entered into an agreement captioned Securities Purchase Agreement with the members of Inception DX, LLC (Inception), a Utah limited liability company. Under the terms of the agreement, the Company acquired Inception for 15,500,000 shares of common stock. Inception owns laboratory equipment, partial interest in database records for over 31,900,000 individuals for use in genetics research, 400,000 units in Juneau Biosciences, LLC, initial CLIA registration, CLIA lab protocols, and other assets. Once the CLIA registration is completed, Inception will be used as a CLIA-certified laboratory by Predictive Technology Group, Inc. and its affiliates. The stock issued was for cash, laboratory equipment, membership units in Juneau Biosciences, LLC (Juneau units), and trade secrets related to the DNA database and protocols related to a future use as a CLIA laboratory. The Juneau units were valued based on the value assigned when the Company entered into a subscription to purchase units of Juneau ($1.10 per unit). The equipment will be depreciated over 5 years. The proprietary data, DNA library, protocols, research and methods are classified as trade secrets in our industry. The Company will amortize the trade secrets over an estimated useful life of 15 years. The stock price on August 22, 2018 was $0.92 per share, indicating a purchase price of $14,260,000 requiring allocation: Assets: Amount Cash $ 799,980 Lab equipment 1,177,750 Investment in non-controlling interest 440,000 Trade secrets 11,842,270 Total purchase price $ 14,260,000 Taueret Laboratories, LLC Asset Purchase On August 22, 2018, the Company entered into an agreement captioned Asset Purchase Agreement (the Purchase Agreement) with Taueret Laboratories, LLC and its members. Under the terms of the Purchase Agreement, the Company issued warrants exercisable for 16,500,000 shares of the Companys common stock. The warrants were exercisable at fair market value of the Companys common stock on the closing date. In consideration for the warrants, the Company acquired (i) approximately 1,000 degenerative disc disease related DNA samples, related family records, relevant clinical records (including approximately 600 affected probands) and 800 ancestry matched control samples, (ii) whole exome sequencing data on approximately 300 degenerative disc disease samples, over 800 local controls, and published reference populations, together with initial analysis of the markers, (iii) project plan, study paperwork, promotional study and materials used in the research study, (iv) exclusive use of a DNA biobank that has a collection of over 300,000 samples for multiple diseases that the Company may target, (v) the remaining interest in database records for over 31,900,000 individuals for use in genetics research, and (vi) other assets. The warrants issued are for proprietary data and methods that are otherwise a trade secret in our industry. Therefore, the Company determined to classify the assets purchased as trade secrets with a 15-year life. The Company used a Black Scholes calculation to determine valuation of the warrants of $13,860,000. As the purchase of the trade secrets with common stock warrants resulted in a difference between book and tax basis in the trade secrets, the carrying amount of the trade secrets was increased to $18,480,000 to reflect the deferred tax liability of $4,620,000 assumed in the transaction. The fair value of the warrants was determined using the following inputs to the Black Scholes model: Risk-free interest rate 2.7% Expected dividend yield 0% Expected life (in years) 5.0 Expected volatility 150% Expected volatility was calculated from the historical volatility of the Companys common stock. Regenerative Medical Technologies, Inc. On December 19, 2018 the Company executed a merger with the shareholders of Regenerative Medical Technologies, Inc. (RMT), a Utah corporation. The Company acquired RMT for 10,000,000 shares of common stock. RMT holds various assets including (i) models, methods and protocols for collection of birthing tissue and DNA samples, (ii) patient registry models, methods and protocols to collect clinical outcomes and electronic medical records, and (iii) designs and methodologies relating to many initiatives that are complementary to anticipated product offerings and ongoing research, and (iv) other assets. The fair value of consideration paid was determined based on our stock price of $0.92 on the date of acquisition. In addition, the Company recognized a deferred tax liability of $3,066,667 related to the differences between book and tax basis arising from the acquisition, resulting in a total purchase price of $12,266,667. The Company determined that the assets acquired qualify for treatment as trade secrets within industry. The trade secrets will be amortized over an estimated useful life of 10 years. Taueret Laboratories, LLC Acquisition On March 22, 2019, the Company completed the acquisition of Taueret Laboratories, LLC (Taueret) pursuant to the Securities Purchase Agreement (as amended, the Purchase Agreement), dated January 1, 2019. Pursuant to the terms of the Purchase Agreement, the Company acquired all of the outstanding units of Taueret. The Company and its affiliates plan to use Tauerets CLIA-certified laboratory to perform diagnostic testing services. The Purchase Agreement also specifies that the Company may, at its sole discretion, put certain patents related to the diagnosis and treatment of Preeclampsia (the Preeclampsia IP) back to the members of Taueret at any time prior to December 31, 2020 (the Preeclampsia Option). On December 31, 2020, an additional payment of $8,547,000 in cash will become due if the Company has not exercised the Preeclampsia Option. After considering the relevant accounting guidance, we determined that the Preeclampsia Option was not part of the business combination with Taueret, because the Preeclampsia Option was included in the Purchase Agreement primarily to benefit the acquirer. The Company acquired Taueret and the Preeclampsia Option for total consideration of $931,817, net of cash acquired of $85,964. The consideration was paid as 552,995 shares of the Companys common stock. The common stock was valued at the closing price on the date of the closing of the merger, adjusted for a 20% discount for lack of marketability related to a contractually stipulated lockup provision with a period of one year. The consideration was allocated between the business combination and the Preeclampsia Option on a relative fair value basis with $917,511 allocated to the business combination and $100,000 Total consideration transferred was allocated to tangible and intangible assets acquired and liabilities assumed based on their fair values as of the acquisition date. Management estimated the fair value of tangible and intangible assets and liabilities in accordance with the applicable accounting guidance for business combinations and utilized the services of third-party valuation consultants. These amounts are provisional and may be adjusted during the measurement period, which expires no later than one year from the acquisition date, if new information is obtained that, if known, would have affected the amounts recognized as of the acquisition date. Assets: Fair Value Current assets $ 663,262 Laboratory equipment 190,397 Software 239,000 Intangible Assets 311,000 Total assets acquired 1,403,659 Liabilities: Accrued liabilities (68,181) Capital lease obligation (54,291) Total liabilities assumed (122,472) Bargain purchase gain (363,676) Total fair value of purchase price $ 917,511 Consideration allocated to Preeclampsia Option 100,000 Total consideration $ 1,017,511 Less: Cash acquired (85,694) Total consideration transferred $ 931,817 Identifiable intangible assets The Company acquired intangible assets that consisted of an internally developed laboratory information management system which had an estimated fair value of $239,000, CLIA regulatory licenses with a fair value of $295,000, and customer relationships with a fair value of $16,000. The fair value of the software was determined using the replacement cost method. The fair value of the CLIA licenses were estimated using the excess earnings method. The estimated net cash flows were discounted using a discount rate of 22%, which is based on the estimated internal rate of return for the acquisition and represents the rate that market participants might use to value the intangible assets. The projected cash flows were based on key assumptions such as estimates of revenues and operating profits. The Company will amortize the intangible assets on a straight-line basis over their estimated useful lives of 15 years for the CLIA license and 5 years for the software and customer relationships. This amortization is deductible for income tax purposes. Bargain purchase gain Any excess of fair value of acquired net assets over the purchase price (negative goodwill) has been recognized as a gain in the period the acquisition was completed. We have reassessed whether all acquired assets and assumed liabilities have been identified and recognized and performed remeasurements to verify that the consideration paid, assets acquired, and liabilities assumed have been properly valued. The remaining excess has been recognized as a gain in other income and expense in the consolidated statement of operations. The bargain purchase gain partly resulted from the allocation of the total consideration between the business combination and the Preeclampsia Option. We also believe we were able to negotiate a bargain price due to the desire of the sellers to induce the Company to purchase the Preeclampsia Option contemporaneously with the business combination. |
INVENTORIES
INVENTORIES | 6 Months Ended |
Dec. 31, 2019 | |
Inventory Disclosure [Abstract] | |
INVENTORIES | NOTE 4 INVENTORIES The composition of inventories is as follows: As of As of December 31, June 30, 2019 2019 Finished goods $ 1,896,878 $ 918,199 Work-in-process 1,747,321 4,485,349 Raw materials and supplies 200,902 371,637 Total inventory on hand $ 3,845,101 $ 5,775,185 |
PROPERTY, PLANT AND EQUIPMENT,
PROPERTY, PLANT AND EQUIPMENT, NET | 6 Months Ended |
Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY, PLANT AND EQUIPMENT, NET | NOTE 5 PROPERTY, PLANT AND EQUIPMENT, NET The composition of property, plant, and equipment is as follows: As of As of December 31, June 30, 2019 2019 Computer equipment $ 647,500 $ 530,815 Furniture 230,747 224,324 Lab equipment 2,210,695 2,469,652 Software 928,369 923,369 Leasehold improvements 997,416 870,098 Other fixed assets in progress 183,937 69,886 Lab equipment subject to finance lease 2,774,907 2,774,907 Total property, plant, and equipment 7,973,571 7,863,051 Accumulated depreciation (1,487,354) (862,851) Accumulated depreciation leased assets (329,857) (25,759) Property, plant and equipment, net $ 6,156,360 $ 6,974,441 Depreciation expense for the three month periods ended December 31, 2019 and 2018 was $546,714 |
GOODWILL & INTANGIBLE ASSETS
GOODWILL & INTANGIBLE ASSETS | 6 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL & INTANGIBLE ASSETS | NOTE 6 GOODWILL & INTANGIBLE ASSETS Intangible assets primarily consist of amortizable purchased licenses, patents, and trade secrets. The following summarizes the amounts reported as intangible assets: Carrying Amount Accumulated Amortization Net Weighted Average Remaining Amortization Period (Years) At December 31, 2019: Licenses $ 21,337,981 $ (4,274,459) $ 17,063,522 8.5 Patents 9,750,000 (3,281,863) 6,468,137 8.5 Trade Secrets 56,675,936 (14,368,767) 42,307,169 8.5 Other 411,000 (73,474) 337,526 10.5 Goodwill 5,254,451 N/A 5,254,451 N/A Total intangible assets $ 93,429,368 $ (21,998,563) $ 71,430,805 8.5 Carrying Amount Accumulated Amortization Net Weighted Average Remaining Amortization Period (Years) At June 30, 2019: Licenses $ 21,337,981 $ (3,275,666) $ 18,062,315 9.0 Patents 9,750,000 (2,899,510) 6,850,490 9.0 Trade Secrets 56,675,936 (11,339,601) 45,336,335 8.9 Other 411,000 (27,069) 383,931 11.0 Goodwill 5,254,451 N/A 5,254,451 N/A Total intangible assets $ 93,429,368 $ (17,541,846) $ 75,887,522 9.0 Estimated future amortization expense related to intangible assets consists of the following as of December 31, 2019: Year Ending June 30 Amount 2020 $ 4,452,050 2021 8,514,306 2022 6,022,890 2023 6,022,890 2024 6,022,890 Thereafter 35,141,328 Total amortization expense for the three months ended December 31, 2019 and 2018 was $2,228,359 and $1,909,480 Endometriosis license On December 28, 2016, Predictive Therapeutics, LLC and Juneau amended and restated the license agreement dated July 9, 2015. An additional license fee of $2,000,000 is due and payable once the Company has received profits of $25,000,000 related to the intellectual property licensed under the agreement. Upon first commercial sale of the licensed assay, the Company will issue to Juneau common shares with a market value of $2,500,000. Juneau is entitled to a royalty equal to 50% of net sales, adjusted to exclude certain costs and fees, and subject to certain minimums. In March of 2018, the Companys licenses with Juneau were amended to reduce the royalty rate and expand the scope of the licenses to include the entire field of endometriosis and pelvic pain. The Company issued 1,000,000 shares of common stock and 14,000,000 warrants with an exercise price of $0.80 per share as consideration. In December of 2018 the Company and Juneau agreed to renegotiate the price paid for the license. The warrants issued initially for this license agreement were cancelled, and new warrants were issued with an increased exercise price of $0.90 per share, resulting in a decrease in the value assigned to the license agreement of $4,449,211. The replacement of the warrants resulted in an additional deferred tax liability of $290,263, resulting in a net decrease in the carrying value of the licenses of $4,158,948. There was an associated adjustment to amortization expense. The fair value of the replacement warrants were determined using the following inputs to the Black Scholes model: Risk-free interest rate 2.7% Expected dividend yield 0% Expected life (in years) 5.0 Expected volatility 150% Companion diagnostic license In addition to the license for the commercialization of assays and related services for the prognosis and monitoring of endometriosis in the infertility market, the Company entered into a license agreement with Juneau to use the assay as a companion diagnostic test in conjunction with endometriosis therapeutics that may be developed from intellectual property owned by the Company and Juneau. Once FDA approval is granted on any companion diagnostic test, a final milestone payment of $250,000 is due. The agreement requires a 2% royalty to be paid to Juneau on the sale of patented therapeutic products specifically covered by the agreement. The Company amortizes the licenses over the life of the underlying patents. |
EQUITY METHOD INVESTMENT
EQUITY METHOD INVESTMENT | 6 Months Ended |
Dec. 31, 2019 | |
Equity Method Investments and Joint Ventures [Abstract] | |
EQUITY METHOD INVESTMENT | NOTE 7 EQUITY METHOD INVESTMENT Juneau Biosciences, LLC The Companys investment in Juneau is accounted for under the equity method and included in the Diagnostics and Therapeutics segment. The following table summarizes the investment: As of December 31, As of June 30, Carrying amount $ 35,329,167 $ 51,717,719 Ownership percentage 48.3% 48.4% In December 2017, the Company and Juneau reached verbal agreement on a stock subscription arrangement. The Company agreed to purchase 15,681,818 Class A Units of Juneau at a price of $1.10 per unit. Subsequent amendments reduced the number of units purchased to 13,000,000. In early 2018, the terms were finalized and memorialized in a subscription agreement executed by the Company and Juneau. Under the terms of the agreement (as amended), the subscription is to be paid in installments through September 30, 2021. The Company has the option to cancel the subscription. If this option is exercised, any units of Juneau issued to the Company but not paid will be cancelled. The agreement includes certain restrictions on the use of funds provided under the subscription agreement and grants the Company the right to appoint a minority of Juneaus Board of Managers. Should the Company elect not to fund the entire subscription, Juneau's obligations to the Company that are not related to the license agreements (see Note 6) will terminate. On September 25, 2019, the Company and Juneau executed an amendment to the subscription agreement. In addition, a receivable due from Juneau in the amount of $184,443 was applied to the subscription payable balance. The schedule of payments as of December 31, 2019 under the amended agreement is as follows: Year Ending June 30 Amount 2020 $ 1,330,000 2021 1,800,000 2022 5,300,000 2023 1,256,610 $ 9,686,610 Summarized financial information for the Companys equity method investee as of and for its fiscal year end is presented in the following tables: Juneau Biosciences, LLC Year ended December 31, 2019 Year ended December 31, 2018 Unaudited Revenue (related party) $ 202,010 $ 2,554,037 Gross profit 202,010 2,554,037 Loss from operations (1,890,382) (2,419,890) Net loss (1,889,921) (2,419,824) Net loss attributable to Predictive Technology Group, Inc. (912,454) (1,200,238) Impairment The Company reviews its equity method investment on a quarterly basis to determine whether a triggering event has occurred that could necessitate an impairment test. During the three months ended December 31, 2019, the Companys stock price declined from $1.67 per share to $0.73 per share, which was determined to qualify as a triggering event for impairment tests of our reporting units, intangible assets, and equity method investments. We engaged a third-party valuation firm to assist us in determining whether the carrying value of our equity method investment had fallen below the carrying value. The valuation was performed using a combination of the cost approach, the income approach, and calibration of the fair values of the Companys operating segments and equity method investment to the Companys overall market capitalization. These valuation approaches use inputs that qualify as Level 3 in the fair value hierarchy. As a result of the valuation, it was determined that the fair value of our equity method investment had fallen to $35,329,167, necessitating an impairment charge of $15,932,016. The total impairment charge is included in Loss on equity method investment in the condensed consolidated statement of operations. The impairment was determined to be other than temporary based on the magnitude of the decline in fair value. |
ACCRUED LIABILITIES
ACCRUED LIABILITIES | 6 Months Ended |
Dec. 31, 2019 | |
Payables and Accruals [Abstract] | |
ACCRUED LIABILITIES | NOTE 8 ACCRUED LIABILITIES As of As of December 31, June 30, 2019 2019 Employee compensation and benefits $ 888,911 $ 816,451 Other 1,042,907 1,041,320 Total accrued liabilities $ 1,931,818 $ 1,857,771 |
DEBT
DEBT | 6 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
DEBT | NOTE 9 DEBT From June to December 2019, the Company issued unsecured promissory notes to six accredited investors in the total amount of $9,360,000. The promissory notes bear 12% simple interest and mature on the two-year anniversary of each note. The notes may be repaid at any time. In September 2019, the Company and the accredited investor entered into a Revolving Loan Agreement whereby an accredited investor agreed to lend the Company up to an additional $3,000,000. Amounts drawn under the revolving loan will be charged interest at a rate of 12% and may be repaid at any time. There was $720,000 outstanding under the Revolving Loan Agreement as of December 31, 2019. All amounts outstanding under the revolving loan are due upon the expiration of the revolving loan facility on September 30, 2021. As of December 31, 2019, unsecured promissory notes bearing 12% interest with a face value of $9,360,000 remain outstanding. The notes mature from June to December 2021. Notes with a face value of $400,000 mature during the fiscal year ended June 30, 2021, with the remainder maturing during the fiscal year ended June 30, 2022. The fair value of the Companys outstanding debt obligations as of December 31, 2019 was $10,080,000, which was determined based on a discounted cash flow model using an estimated market rate of interest of 12%, which is classified as Level 2 within the fair value hierarchy. |
INCOME TAXES
INCOME TAXES | 6 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | NOTE 10 INCOME TAXES In order to determine the Companys quarterly provision for income taxes, the Company used an estimated annual effective tax rate that is based on expected annual income and applicable federal and state tax rates. The Tax Cuts and Jobs Act reduced the federal corporate tax rate to 21% in the fiscal year ended June 30, 2019. Section 15 of the Internal Revenue Code stipulates that the Companys fiscal year ended June 30, 2019, had a blended corporate tax rate of 28%, which is based on the applicable tax rates before and after the Tax Act and the number of days in the year. For the fiscal years ending after June 30, 2019, the Companys federal corporate tax rate is 21%. Certain significant or unusual items are separately recognized in the quarter during which they occur and can be a source of variability in the effective tax rate from quarter to quarter. The Company recognized income tax benefits of $4,239,780 and $713,526 for the three-month periods ended December 31, 2019 and 2018, respectively. The Company recognized income tax benefits of $9,448,195 and $1,325,978 for the six month periods ended December 31, 2019 and 2018, respectively. The Companys recognized effective tax rate differs from the U.S. federal statutory rate for the three and six months ended December 31, 2019 primarily due to state income taxes, share based compensation, excess tax benefits arising from the exercise of commons stock warrants during the period, and tax benefits resulting from the impairment of our equity method investment (see Note 7), as well as an increase in the valuation allowance on deferred tax assets. The Companys recognized effective tax rate differs from the U.S. federal statutory rate for the three and six months ended December 31, 2018 primarily due to state income taxes and share based compensation. |
STOCKHOLDER'S EQUITY
STOCKHOLDER'S EQUITY | 6 Months Ended |
Dec. 31, 2019 | |
Stockholders' Equity Note [Abstract] | |
STOCKHOLDER'S EQUITY | NOTE 11 STOCKHOLDERS EQUITY The Company has issued various warrants exercisable for our common stock outside of the 2015 Stock Option Plan (see Note 13). The warrants were issued to raise capital, as compensation for acquisitions of intellectual property, and as compensation for services. In September 2019, the Company entered into an agreement with a consultant for research and development services. In consideration for these services, the Company granted warrants to the consultant exercisable for 1,250,000 shares of the Companys common stock with a strike price equal to the closing price of the Companys common stock on the date of grant. Warrants to acquire 625,000 shares vested upon issuance. Of the remaining warrants, 375,000 vest on March 1, 2020 and 225,000 vest on September 1, 2020. The warrants expire ten years from the date of issuance. On July 16, 2019 and August 1, 2019, a total of 11,000,000 common stock warrants issued to FlagshipSailsRx, LLC, our former sales and marketing contractor, were exercised pursuant to a cashless exercise feature. The cashless exercise resulted in the issuance of 9,172,157 shares of common stock and the cancellation of 1,827,843 warrants as consideration for the exercise price. The following is a summary of warrant activity from June 30, 2019 through December 31, 2019: Number of Warrants Weighted Average Exercise Price Weighted Average Remaining Contractual Life (Years) Warrant: Outstanding June 30, 2019 68,253,520 $ 0.78 3.6 Granted 1,250,000 1.73 9.7 Exercised (9,223,605) 0.50 2.7 Forfeited/ Cancelled (1,836,395) 0.50 2.7 Outstanding December 31, 2019 58,443,520 $ 0.85 3.3 The Company recognizes expense for warrants issued for services that are subject to graded vesting on a straight-line basis. Share based compensation expense related to warrants issued for services for the three months ended December 31, 2019 and 2018 was $1,361,172 and $358,333, respectively. Share based compensation expense related to warrants issued for services for the six months ended December 31, 2019 and 2018 was $3,251,384 and $944,778, respectively. As of December 31, 2019, unrecognized compensation cost related to warrants issued for services was $4,010,755 and is expected to be recognized over a weighted average period of 1.36 years. |
EARNINGS PER COMMON SHARE (EPS)
EARNINGS PER COMMON SHARE (EPS) | 6 Months Ended |
Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |
EARNINGS PER COMMON SHARE (EPS) | NOTE 12 EARNINGS PER COMMON SHARE (EPS) The computation of weighted average shares outstanding and the basic and diluted earnings per common share for the following periods consisted of the following: Net Average Shares Per Share Loss Outstanding Amount Three months ended December 31, 2019 Basic and diluted EPS attributable to common shareholders $(26,002,669) 283,126,298 $(0.09) Three months ended December 31, 2018 Basic and diluted EPS attributable to common shareholders $(2,329,438) 263,278,417 $(0.01) Six months ended December 31, 2019 Basic and diluted EPS attributable to common shareholders $(33,867,276) 282,203,748 $(0.12) Six months ended December 31, 2018 Basic and diluted EPS attributable to common shareholders $(4,333,820) 258,672,982 $(0.02) Potentially dilutive securities that would be excluded from the calculation of diluted net loss per common share because to include them would be anti-dilutive are as follows: As of December 31, 2019 2018 Warrants for common stock 58,443,520 64,993,520 Options for common stock 25,921,050 6,446,250 84,364,570 71,439,770 |
STOCK OPTION PLAN
STOCK OPTION PLAN | 6 Months Ended |
Dec. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | |
STOCK OPTION PLAN | NOTE 13 STOCK OPTION PLAN In 2015, a Stock Option Plan was adopted to advance the interests of the Company and its shareholders by helping the Company obtain and retain the services of employees, officers, consultants, independent contractors and directors, upon whose judgment, initiative and efforts the Company is substantially dependent, and to provide those persons with further incentives to advance the interests of the Company. Eligible participants include employees, officers, certain consultants, or directors of the Company or its subsidiaries. The number of shares, terms, and vesting periods are determined by the Companys Board of Directors or a committee thereof on an award-by-award basis. Awards provided under the Plan generally vest in three equal annual installments. The maximum term of options issued under the plan is 10 years from the date of grant. The aggregate number of shares of Option Stock that may be issued pursuant to the exercise of Options granted under this Plan will not exceed fifteen percent (15%) of the total outstanding shares of the Company's common stock. The Company settles exercises of stock option awards by issuing new shares. Forfeitures are recognized as they occur. A summary of option activity is as follows for the six months ended December 31, 2019: Number of shares Weighted average exercise price Options outstanding at June 30, 2019 24,407,750 $ 1.74 Options granted 2,595,800 1.40 Less: Options exercised - - Options canceled or expired (1,082,500) 1.65 Options outstanding at end of period 25,921,050 $ 1.72 Share based compensation expense related to options issued under the 2015 Plan for the three months ended December 31, 2019 and 2018 was $3,272,897 and $652,172, respectively. Share based compensation expense related to options issued under the 2015 Plan for the six months ended December 31, 2019 and 2018 was $6,377,285 and $1,038,076, respectively. The Company recognizes expense for awards subject to graded vesting on a straight-line basis. As of December 31, 2019, there was $27,462,272 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 14 COMMITMENTS AND CONTINGENCIES Licenses The Company has commitments under license agreements which are described in Note 6. Leases On October 10, 2019, substantially all of the Companys operating leases of office and laboratory space were amended to extend the expiration dates of the leases to September 30, 2021. The Company also leased an additional 6,711 square feet of office and storage space that commenced on November 1, 2019 and expires on September 30, 2021. In March 2019, the Company entered into finance leases of laboratory equipment. The validation process for the leased equipment was completed and payments commenced in October 2019. The leases expire in September 2022, at which time the Company has the option to purchase the leased equipment for one dollar. The table below presents the future minimum lease payments under operating and finance leases: Year Ending June 30, Operating Finance Total 2020 $ 476,816 $ 393,090 $ 869,906 2021 979,071 748,361 1,727,432 2022 246,888 740,797 987,685 2023 - 167,719 167,719 2024 - - - Total cash payments 1,702,775 2,049,967 3,752,742 Less: Imputed interest (128,619) (214,844) (343,463) Total lease liability $ 1,574,156 $ 1,835,123 $ 3,409,279 Lease information for the three months ended December 31, 2019 is as follows: Three months ended December 31, 2019 Six months ended December 31, 2019 Lease cost Finance lease cost Amortization of right of use assets $ 156,057 $ 180,469 Interest on lease liabilities 40,488 44,901 Operating lease cost 223,051 327,455 Short-term lease cost 450 64,787 Total lease cost $ 420,046 $ 617,612 Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from finance leases $ 40,488 $ 44,901 Operating cash flows from operating leases 224,088 329,517 Financing cash flows from finance leases 156,057 180,469 Weighted average remaining lease term finance leases (Years) 2.61 Weighted average remaining lease term operating leases (Years) 1.75 Weighted average discount rate finance leases 8.06% Weighted average discount rate operating leases 8.63% Lease expense under operating leases was $108,201 and $159,979 Purchase commitments In March 2019, in connection with the lease of laboratory equipment described above, the Company agreed to purchase a fixed quantity of the consumables used by the equipment for a total of $1,386,710. The Company is obligated to pay for the consumables in twelve fixed monthly installments beginning in October 2019. At December 31, 2019, the Company had taken delivery of consumables worth $248,724 in excess of the installment amounts paid. The amount due for goods that have been delivered is included in accrued liabilities on the consolidated balance sheet. Remaining payments due under the purchase commitment total $693,355 during the year ending June 30, 2020 and $346,477 during the year ending June 30, 2021. Legal proceedings On or about July 13, 2018, RTJ, LLC and two of its principals filed a lawsuit against Predictive Therapeutics LLC, Predictive Biotech, Inc., both subsidiaries of Predictive Technology Group, Inc., and Jack Turner, Jr., an employee of Predictive Biotech, Inc. The plaintiffs had acted in a distributor capacity. The relationship was terminated. Plaintiffs are alleging breach of contract, promissory estoppel, unjust enrichment, fraud, breach of fiduciary duty, defamation, false light, and tortious interference. Based on the information available to us, we do not believe any of the RTJ proceedings will have a material adverse effect on our business, results of operations, financial position or liquidity. Further, we deny the allegations in the complaint, have not discovered any evidence of wrongdoing with respect to the allegations and will vigorously defend against these allegations. On or about May 1, 2019, Surgenex, LLC and one of its principals filed a lawsuit against Predictive Therapeutics LLC, Predictive Biotech, Inc., both subsidiaries of Predictive Technology Group, Inc., and Doug Schmid, an employee of Predictive Biotech, Inc. In 2014 Surgenex contracted with Utah Cord Bank, Inc., a former employer of Doug Schmid, to assist Surgenex in the doing work relating to allograft tissue. Schmid was later hired by Predictive Biotech, Inc. In connection with Schmids employment with Predictive Biotech, Surgenex has filed a lawsuit alleging unjust enrichment, conspiracy, conversion, tortious interference with contractual and business relations, violations of trade secrets act, and other claims. Based on the information available to us, we do not believe the Surgenex proceedings will have a material adverse effect on our business, results of operations, financial position or liquidity. Further, we deny the allegations in the complaint, have not discovered any evidence of wrongdoing with respect to the allegations and will vigorously defend against these allegations. On or about July 12, 2019, Predictive Technology Group, Inc. and Predictive Therapeutics, LLC, a subsidiary of Predictive Technology Group, Inc. filed a lawsuit against Michael Schramm. Schramm had previously acted as our patent agent. While acting as our patent agent, Schramm entered into an agreement to sell us certain patents and patent applications in consideration for equity securities. Schramm represented that he owned all right, title and interest in and to the intellectual property. We were subsequently advised by the patent counsel who replaced Schramm that Schramms representation was false. The Company raised these concerns with Schramm, who did not provide satisfactory evidence addressing the concerns of our current patent counsel. We sued Schramm for breach of contract, conversion and on other legal theories and are seeking, among other things, rescission of the purchase and sale transaction. Schramm filed a counterclaim against us and Bradley C. Robinson, our Chief Executive Officer and Transfer Online, Inc., our transfer agent. Schramm is alleging he did not make any false representations. He is alleging, among other things, that various parties involved in the transaction committed breach of contract, conversion, violations of Nevada state law for failure to transfer securities, breach of fiduciary duty, tortious interference, and civil conspiracy. Based on the information available to us, we do not believe the Schramm proceedings will have a material adverse effect on our business, results of operations, financial position or liquidity. Further, we deny the allegations in the counterclaim, have not discovered any evidence of wrongdoing with respect to the allegations in the counterclaim and will vigorously prosecute our claims against Schramm. As of December 31, 2019, we did not record a liability related to these matters as it was determined that an unfavorable resolution is either not currently probable or that an amount or relevant range is not reasonably estimable, or both. However, litigation is inherently unpredictable and it is possible that losses may occur. Any unfavorable resolution of any of these matters could materially affect our consolidated financial position, cash flows, or results of operations. All legal costs associated with litigation are expensed as incurred. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 6 Months Ended |
Dec. 31, 2019 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 15 SUBSEQUENT EVENTS Management has evaluated subsequent events through February 14, 2020, the date on which the financial statements were available to be issued. On December 31, 2019, four accredited investors agreed in substance to accept repayment in equity shares for promissory notes with a face value of $8,420,000 and the $720,000 outstanding under of the Revolving Loan Agreement, as well as $311,918 in accrued interest thereon. For accounting purposes, the debt was not considered extinguished until the Company issued the shares after the balance sheet date. Subsequent to the balance sheet date, the debt was extinguished in full by issuing 12,947,833 shares of the Companys common stock based on the closing market price on December 31, 2019 of $0.73 per share. On January 29, 2020, the Company sold 500,000 shares of our common stock, par value $0.001, to an accredited investor at a price of $0.96 per share. On February 10, 2020, the Company and Juneau Biosciences, LLC, its equity method investee, executed an amendment to the agreement captioned Third Amended and Restated Subscription Agreement. Under the terms of the agreement, the Company issued common stock, par value $0.001, with a value of $2,430,000 (the Equity Payment) based on the closing market price on the agreement date that was applied against the subscription payable. The amendment also changed the schedule of cash payments due under the subscription agreement to purchase units of Juneau. The pro forma schedule of payments as of December 31, 2019 under the amended agreement is as follows, with the Equity Payment included in the amount shown for the fiscal year ended June 30, 2020: Year Ending June 30 Amount 2020 $ 3,030,000 2021 4,600,000 2022 2,056,610 $ 9,686,610 In February 2020, the Company borrowed $200,000 under its Revolving Loan Agreement with an accredited investor. The Company also borrowed an additional $450,000 under a promissory note with a second accredited investor. The promissory note bears 12% simple interest and matures on the two-year anniversary of the note. The note may be repaid at any time. |
BUSINESS DESCRIPTION AND SIGN_2
BUSINESS DESCRIPTION AND SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Dec. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
BUSINESS DESCRIPTION | BUSINESS DESCRIPTION: Predictive Technology Group, Inc., together with its subsidiaries (collectively, PTG, Predictive or the Company), develops and commercializes discoveries and technologies involved in novel molecular diagnostic, therapeutic, and Human Cellular and Tissue-Based Products (HCT/Ps). The Company uses this information as the cornerstone in the development of new diagnostics that assess a persons risk of disease and develop pharmaceutical therapeutics and HCT/Ps for use by healthcare professionals to improve outcomes in their patients. The Companys corporate headquarters are located in Salt Lake City, Utah. |
SEGMENT INFORMATION | SEGMENT INFORMATION Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision-maker (CODM) in making decisions regarding resource allocation and assessing performance. The Company operates in two reportable segments, which are differentiated by product. The HCT/P segment offers minimally manipulated tissue products intended for homologous use, prepared utilizing proprietary extraction methods that reduce the loss of important scaffolding, growth factors and cytokines. The Companys Diagnostics and Therapeutics segment uses data analytics for disease identification and subsequent therapeutic intervention through novel gene-based diagnostics, and companion therapeutics. Lastly, the Unallocated Corporate column in the table below represents those headquarters activities that do not qualify as operating segments and which are not allocated to operating segments in information provided to the CODM. We currently sell our products exclusively in the United States. During the fourth quarter of 2019, we realigned our segment reporting to separately present headquarters costs in information available to the CODM. The presentation of the comparative information has been recast to conform to the 2019 presentation. Segment revenue and operating income (loss) HCT/Ps Diagnostics & Therapeutics Unallocated Corporate Total Three months ended December 31, 2019 Revenues $ 7,289,265 $ 47,375 $ - $ 7,336,640 Depreciation and amortization 937,923 1,756,560 80,590 2,775,073 Share based compensation 1,242,875 254,353 3,136,841 4,634,069 Segment operating loss (7,067,094) (3,261,117) (3,399,191) (13,727,402) Three months ended December 31, 2018 Revenues $ 10,687,036 $ - $ - $ 10,687,036 Depreciation and amortization 771,416 1,181,317 82,627 2,035,360 Share based compensation 316,089 8,186 686,230 1,010,505 Segment operating loss (507,527) (1,249,673) (719,591) (2,476,791) Six months ended December 31, 2019 Revenues $ 15,473,896 $ 122,002 $ - $ 15,595,898 Depreciation and amortization 1,836,868 3,387,858 160,592 5,385,318 Share based compensation 2,914,331 704,454 6,009,884 9,628,669 Segment operating loss (13,611,080) (6,489,756) (6,518,740) (26,619,576) Six months ended December 31, 2018 Revenues $ 18,750,838 $ - $ - $ 18,750,838 Depreciation and amortization 1,512,884 2,012,840 175,358 3,701,082 Share based compensation 371,838 8,186 1,602,830 1,982,854 Segment operating loss (838,369) (2,216,214) (1,752,352) (4,806,935) Three months ended December 31, Six months ended December 31, 2019 2018 2019 2018 Total operating loss for reportable segments $ (10,328,211) $ (1,757,200) $ (20,100,836) $ (3,054,583) Unallocated amounts: Unallocated Corporate (3,399,191) (719,591) (6,518,740) (1,752,352) Other loss (16,546,988) (599,627) (16,759,770) (913,986) Loss before income taxes $ (30,274,390) $ (3,076,418) $ (43,379,346) $ (5,720,921) As of December 31, As of June 30, Total Assets 2019 2019 HCT/Ps $ 16,302,925 $ 21,052,082 Diagnostics and therapeutics 101,442,833 120,665,445 Unallocated corporate 1,468,484 1,860,658 Total Assets $ 119,214,242 $ 143,578,185 |
BASIS OF PRESENTATION | BASIS OF PRESENTATION: The accompanying consolidated financial statements have been prepared by Predictive Technology Group, Inc. (the Company or Predictive) in accordance with U.S. generally accepted accounting principles (GAAP) for financial information and pursuant to the applicable rules and regulations of the Securities and Exchange Commission (SEC). The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. In the opinion of management, the accompanying financial statements contain all adjustments (consisting of normal and recurring accruals) necessary to present fairly all financial statements in accordance with U.S. GAAP. The condensed consolidated financial statements herein should be read in conjunction with the Companys audited consolidated financial statements and notes thereto for the fiscal year ended June 30, 2019, included in the Companys Annual Report on Form 10-K for the fiscal year ended June 30, 2019. Operating results for the three and six months ended December 31, 2019 may not necessarily be indicative of results to be expected for any other interim period or for the full fiscal year. |
Fiscal Year End | Fiscal Year End The Company operates on a fiscal year basis with the fiscal year ending on June 30. |
Consolidation | Consolidation These consolidated financial statements include the financial statements of Predictive Technology Group, Inc. and its wholly owned subsidiaries. All inter-company accounts and transactions have been eliminated in consolidation. |
Cash Equivalents | Cash Equivalents The Company considers all highly-liquid investments with a maturity of three months or less, when purchased, to be cash equivalents. The Company places its temporary cash investments with high-quality financial institutions. |
Going Concern | Going Concern The accompanying financial statements have been prepared under the assumption that the Company will continue to operate as a going concern, which contemplates the realization of assets and the settlement of liabilities in the normal course of business. The condensed consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts of liabilities that may result from any inability of the Company to continue as a going concern. The Company incurred a net loss of $33,867,276 for the six months ended December 31, 2019 and net cash outflows from operations of $9,914,968. At December 31, 2019, the Company had $255,502 of cash and negative working capital of $4,861,267. The Company's historical and current use of cash in operations combined with limited liquidity resources raise substantial doubt regarding the Companys ability to continue as a going concern. Management may seek additional capital through debt financings, collaborative or other funding arrangements with partners, or through other sources of financing. Should the Company seek additional financing from outside sources, the Company may not be able to raise such financing on terms acceptable to the Company or at all. If the Company is unable to raise additional capital when required or on acceptable terms, this could have a material adverse effect on liquidity. In such a case, the Company may be required to scale back or to discontinue the promotion of currently available products, scale back or discontinue the advancement of product candidates, reduce headcount, file for bankruptcy, reorganize, merge with another entity, or cease operations. |
Trade Accounts Receivable and Allowance for Doubtful Accounts | Trade Accounts Receivable and Allowance for Doubtful Accounts Trade accounts receivable are primarily comprised of amounts due from sales of the Companys HCT/P products that are recorded at the invoiced amount, and deposits in transit from credit card processors. The allowance for doubtful accounts is based on the Companys best estimate of the amount of probable losses in the Companys existing accounts receivable, which is based on historical write-off experience, customer creditworthiness, facts and circumstances specific to outstanding balances, and payment terms. Account balances are charged against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. The Company does not have any off-balance-sheet credit exposure related to its customers and does not require collateral. |
Inventories | Inventories Inventories consist primarily of HCT/Ps produced by Predictive Biotech, Inc. ("Predictive Biotech"), a wholly owned subsidiary and laboratory supplies used in genetic testing performed by Predictive Laboratories, Inc. ("Predictive Labs"). We value inventory at the lower of cost or net realizable value. We determine the cost of inventory using the standard cost method, which approximates actual cost based on a first-in, first-out method. All other costs, including administrative costs, are expensed as incurred. We analyze our inventory levels at least quarterly and write down inventory that has a cost basis in excess of its expected net realizable value, or that is considered in excess of normal operating levels, as determined by management. We also reserve for the quantity of quarantined (WIP) inventory that is not expected to pass quality control based on historical averages. The related costs are recognized as cost of goods sold in the consolidated statements of operations. |
Stock Subscriptions Receivable | Stock Subscriptions Receivable Stock subscriptions are recorded as contra-equity on the day the subscription agreement is signed and accepted by the Company. As of December 31, 2019 and June 30, 2019, all stock subscribed has been fully paid. |
Prepaid Expenses | Prepaid Expenses Amounts paid in advance for expenses are accounted for as prepaid expenses and classified as current assets if such amounts are to be recognized as expense within one year from the balance sheet date. |
Property, Plant and Equipment | Property, Plant and Equipment Lab equipment, furniture and computer equipment are stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method based on the lesser of estimated useful lives of the related assets or the underlying lease term. Lab equipment items have depreciable lives of 5 years, furniture items have depreciable lives of 5 to 7 years, and computer equipment items have depreciable lives of 3 years. Repair and maintenance costs are charged to expense as incurred. Amortization of assets recorded under finance leases is included in depreciation expense. The Company reviews property and equipment for impairment. Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. Recoverability of these assets is measured by comparison of their carrying amounts to future undiscounted cash flows the assets are expected to generate. If property and equipment are considered to be impaired, the impairment to be recognized equals the amount by which the carrying value of the assets exceeds its fair market value. |
Leases | Leases We have entered into operating and finance lease agreements primarily for office and laboratory facilities and laboratory equipment located in Salt Lake City, Utah with lease periods expiring between 2020 and 2022. We determine if an arrangement is a lease at inception. For all classes of underlying assets, we elect not to recognize right of use assets or lease liabilities when a lease has a lease term of 12 months or less at the commencement date and does not include an option to purchase the underlying asset that we are reasonably certain to exercise. Operating lease assets and liabilities are included on our consolidated balance sheet beginning July 1, 2019. Finance lease assets are included in property and equipment, net. Operating lease assets and liabilities are recognized at the present value of the future lease payments at the lease commencement date. The interest rate used to determine the present value of the future lease payments is our incremental borrowing rate, because the interest rate implicit in most of our leases is not readily determinable. Our incremental borrowing rate is estimated to approximate the interest rate on a collateralized basis with similar terms and payments, and in economic environments where the leased asset is located. Operating lease assets also include any prepaid lease payments and lease incentives. Our lease terms include periods under options to extend or terminate the lease when it is reasonably certain that we will exercise that option. We generally use the base, non-cancelable, lease term when determining the lease assets and liabilities. Operating lease expense is recognized on a straight-line basis over the lease term. Our lease agreements generally contain lease and non-lease components. Non-lease components primarily include payments for maintenance and utilities. We combine fixed payments for non-lease components with our lease payments and account for them together as a single lease component, which increases the amount of our lease assets and liabilities. |
Intangible Assets and Other Long-Lived Assets | Intangible Assets and Other Long-Lived Assets Intangible and other long-lived assets are comprised of acquired patents, licenses, trade secrets and other intellectual property. Acquired intangible assets are recorded at fair value and amortized over the shorter of the contractual life or the estimated useful life. The Company reviews definite-lived intangible assets for impairment. Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. Recoverability of these assets is measured by comparison of their carrying amounts to future undiscounted cash flows the assets are expected to generate. If identifiable intangibles are considered to be impaired, the impairment to be recognized equals the amount by which the carrying value of the assets exceeds its fair market value. Indefinite-lived intangible assets not subject to amortization are reviewed for impairment annually, typically at the beginning of the fourth fiscal quarter, or whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. Such events and circumstances may include sweeping regulatory changes, shifts in market demand that would negatively impact revenue, overall industry deterioration, dramatic increase in the number of competitors, rapidly increasing costs related to production inputs, significant changes in Company management or Company strategy, or significant litigation. The Company first assesses qualitative factors above to determine whether it is necessary to perform the quantitative impairment test to identify any impairment loss. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset or asset group to estimated future undiscounted net cash flows, or fair value, of the related asset or group of assets over their remaining lives. Certain of the Companys patents are currently subject to litigation (see Note 14) to determine whether the seller of the patents had satisfactory title to the patents that were then sold to the Company. These patents have a carrying value of $6,468,137 on our consolidated balance sheet as of December 31, 2019. While the litigation is in its early stages and may reach a broad range of possible outcomes, we have determined that it is at least reasonably possible that the patents may become impaired in the near term depending on the information gained during the legal discovery process and the outcome of the litigation. The Company reviews equity method investments for impairment whenever events or changes in circumstances indicate that the carrying amount of the investment may not be recoverable in accordance with generally accepted accounting principles. This determination requires significant judgment. In making this judgment, the Company considers available quantitative and qualitative evidence in evaluating potential impairment of these investments. If it is determined that an indicator of impairment exists, the Company assesses whether the carrying value exceeds the fair value of the asset. If the carrying value of the investment exceeds its fair value, the Company will evaluate, among other factors, general market conditions, the duration and extent to which the carrying value is greater than the fair value, and the Companys intent and ability to hold, or plans to sell, the investment. The Company also considers specific adverse conditions related to the financial health of and business outlook for the investee, including industry and sector performance, changes in technology, and operational and financing cash flow factors. Once a decline in fair value is determined to be other-than-temporary, an impairment charge will be recorded and a new carrying basis in the investment will be established. The Company recorded an impairment charge of $15,932,016 related to our equity method investment in Juneau Biosciences, LLC (see Note 7). |
Revenue Recognition | Revenue Recognition We derive our revenue primarily from sales of HCT/P products to clinicians. The majority of our contracts with customers have a single performance obligation, and all of our contracts with customers have a duration of less than one year. Revenue is recognized when control of the product passes to the customer, typically upon confirmation of delivery of the product to the customer. As our products must remain frozen during transit, we typically ship our products overnight. Revenue is recognized in an amount that reflects the expected consideration to be received in exchange for such goods or services. As such, customer orders are recorded as deferred revenue prior to delivery of products or services ordered. Generally, we require authorization from a credit card or verification of receipt of payment before we ship products to customers. From time to time we grant credit to our customers with normal credit terms (typically 30 days). We do not recognize assets associated with costs to obtain or fulfill a contract with a customer, as the amortization period for any such costs if capitalized would be one year or less. Shipping and handling is considered a fulfillment activity, as it takes place prior to the customer obtaining control of the product, and fees charged to customers are included in net revenue upon completion of our performance obligation. Shipping and handling expenses are included in cost of sales. We present revenue net of sales taxes, discounts, and expected returns. |
Deferred Revenue | Deferred Revenue We recognize a contract liability when customer payment precedes the completion of our performance obligations. The following table provides information about deferred revenue from contracts with customers, including significant changes in deferred revenue balances during the period (in thousands). Amount Deferred revenue at June 30, 2019 $ 469,376 Increase due to deferral of revenue at period end 512,280 Decrease due to beginning contract liabilities recognized as revenue (469,376) Deferred revenue at December 31, 2019 $ 512,280 |
Research and Product Development Costs | Research and Product Development Costs The Company expenses research and product development costs as incurred. |
Product Liability and Warranty Costs | Product Liability and Warranty Costs The Company maintains product liability insurance and has not experienced any related claims from its product offerings. The Company also offers a warranty to customers providing that its products will be delivered free of any material defects. There have been no material costs incurred since inception based on estimated return rates. The Company reviews the adequacy of its accrual on a quarterly basis. |
Income Taxes | Income Taxes In order to determine the Companys quarterly provision for income taxes, the Company uses an estimated annual effective tax rate that is based on expected annual income and applicable federal and state tax rates. Deferred tax assets and liabilities are recorded to reflect the future tax consequences attributable to the effects of differences between the carrying amounts of existing assets and liabilities for financial reporting and for income tax purposes. Deferred taxes are calculated by applying enacted statutory tax rates and tax laws to future years in which temporary differences are expected to reverse. The impact on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that the rate change is enacted. |
Other Comprehensive Loss | Other Comprehensive Loss Comprehensive loss is comprised of net loss and other comprehensive loss. Other comprehensive loss is equal to net loss for the three and six months ended December 31, 2019 and 2018. |
Measurement of Fair Value | Measurement of Fair Value The fair value of a financial instrument is the amount that could be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financial assets are marked to bid prices and financial liabilities are marked to offer prices. Fair value measurements do not include transaction costs. A fair value hierarchy is used to prioritize the quality and reliability of the information used to determine fair values. Categorization within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The fair value hierarchy is defined in the following three categories: Level 1: Quoted market prices in active markets for identical assets or liabilities. Level 2: Observable market-based inputs or inputs that are corroborated by market data. Level 3: Unobservable inputs that are not corroborated by market data. During the three and six months ended December 31, 2019 and 2018, we did not have any remeasurements of non-financial assets measured at fair value on a non-recurring basis subsequent to their initial recognition. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with 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 sales and expenses during the reporting periods. Key estimates in the accompanying unaudited condensed consolidated financial statements include, among others, revenue recognition, allowances for doubtful accounts and product returns, provisions for obsolete inventory, valuation of long-lived assets, and deferred income tax asset valuation allowances. Actual results could differ materially from these estimates. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In June 2016, the FASB issued ASU 2016-13, Financial Instruments Credit Losses (Topic 326) which introduces new guidance for the accounting for credit losses on instruments within its scope. The new guidance, as amended by subsequent ASUs, introduces an approach based on expected losses to estimate credit losses on certain types of financial instruments. For trade receivables, the Company will be required to use a forward-looking expected loss model rather than the incurred loss model for recognizing credit losses which reflects losses that are probable. For public business entities that meet the definition of a U.S. Securities and Exchange Commission (SEC) filer, excluding entities eligible to be smaller reporting companies as defined by the SEC, the amendments in this Update are effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. For all other entities, the amendments in this Update are effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. Early adoption is permitted. Application of the amendments is through a cumulative-effect adjustment to retained earnings as of the effective date. The Company is currently evaluating the impact of this update on the consolidated financial statements. In December 2019, the FASB issued ASU 2019-12, "Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes" (ASU 2019-12), which eliminates certain exceptions for recognizing deferred taxes for investments, performing intraperiod allocation and calculating income taxes in interim periods. This ASU also includes guidance to reduce complexity in certain areas, including recognizing deferred taxes for tax goodwill and allocating taxes to members of a consolidated group. ASU 2019-12 is effective for annual and interim periods in fiscal years beginning after December 15, 2020. Early adoption is permitted. The Company is currently assessing the impact of ASU 2019-12 on its consolidated financial statements. |
Recently Adopted Accounting Standards | Recently Adopted Accounting Standards In February 2016, the FASB established Topic 842, Leases, by issuing Accounting Standards Update (ASU) No. 2016-02, which requires lessees to recognize leases on the balance sheet and disclose key information about leasing arrangements. Topic 842 was subsequently amended by ASU No. 2018-01, Land Easement Practical Expedient for Transition to Topic 842; ASU No. 2018-10, Codification Improvements to Topic 842, Leases; and ASU No. 2018-11, Targeted Improvements. The new standard establishes a right-of-use model (ROU) that requires a lessee to recognize a ROU asset and lease liability on the balance sheet for all leases with a term longer than 12 months. Leases are classified as finance or operating, with classification affecting the pattern and classification of expense recognition in the income statement. The new standard was effective for us on July 1, 2019. A modified retrospective transition approach is required, applying the new standard to all leases existing at the date of initial application. An entity may choose to use either (1) its effective date or (2) the beginning of the earliest comparative period presented in the financial statements as its date of initial application. If an entity chooses the second option, the transition requirements for existing leases also apply to leases entered into between the date of initial application and the effective date. The entity must also recast its comparative period financial statements and provide the disclosures required by the new standard for the comparative periods. We used the effective date as our date of initial application. Consequently, financial information was not updated, and the disclosures required under the new standard were not provided for dates and periods before July 1, 2019. The new standard provides a number of optional practical expedients in transition. We elected the package of practical expedients, which permits us not to reassess under the new standard our prior conclusions about lease identification, lease classification and initial direct costs. We elected all of the new standards available transition practical expedients that are applicable. The new standard also provides practical expedients for an entitys ongoing accounting. We elected the short-term lease recognition exemption for all leases that qualify. This means, for those leases that qualify, we will not recognize ROU assets or lease liabilities, and this includes not recognizing ROU assets or lease liabilities for existing short-term leases of those assets in transition. We also elected the practical expedient to not separate lease and non-lease components for all of our leases, other than for leases of real estate. |
BUSINESS DESCRIPTION AND SIGN_3
BUSINESS DESCRIPTION AND SIGNIFICANT ACCOUNTING POLICIES (Tables) | 6 Months Ended |
Dec. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Segment Reporting | Segment revenue and operating income (loss) HCT/Ps Diagnostics & Therapeutics Unallocated Corporate Total Three months ended December 31, 2019 Revenues $ 7,289,265 $ 47,375 $ - $ 7,336,640 Depreciation and amortization 937,923 1,756,560 80,590 2,775,073 Share based compensation 1,242,875 254,353 3,136,841 4,634,069 Segment operating loss (7,067,094) (3,261,117) (3,399,191) (13,727,402) Three months ended December 31, 2018 Revenues $ 10,687,036 $ - $ - $ 10,687,036 Depreciation and amortization 771,416 1,181,317 82,627 2,035,360 Share based compensation 316,089 8,186 686,230 1,010,505 Segment operating loss (507,527) (1,249,673) (719,591) (2,476,791) Six months ended December 31, 2019 Revenues $ 15,473,896 $ 122,002 $ - $ 15,595,898 Depreciation and amortization 1,836,868 3,387,858 160,592 5,385,318 Share based compensation 2,914,331 704,454 6,009,884 9,628,669 Segment operating loss (13,611,080) (6,489,756) (6,518,740) (26,619,576) Six months ended December 31, 2018 Revenues $ 18,750,838 $ - $ - $ 18,750,838 Depreciation and amortization 1,512,884 2,012,840 175,358 3,701,082 Share based compensation 371,838 8,186 1,602,830 1,982,854 Segment operating loss (838,369) (2,216,214) (1,752,352) (4,806,935) Three months ended December 31, Six months ended December 31, 2019 2018 2019 2018 Total operating loss for reportable segments $ (10,328,211) $ (1,757,200) $ (20,100,836) $ (3,054,583) Unallocated amounts: Unallocated Corporate (3,399,191) (719,591) (6,518,740) (1,752,352) Other loss (16,546,988) (599,627) (16,759,770) (913,986) Loss before income taxes $ (30,274,390) $ (3,076,418) $ (43,379,346) $ (5,720,921) As of December 31, As of June 30, Total Assets 2019 2019 HCT/Ps $ 16,302,925 $ 21,052,082 Diagnostics and therapeutics 101,442,833 120,665,445 Unallocated corporate 1,468,484 1,860,658 Total Assets $ 119,214,242 $ 143,578,185 |
Schedule of Deferred Revenue | The following table provides information about deferred revenue from contracts with customers, including significant changes in deferred revenue balances during the period (in thousands). Amount Deferred revenue at June 30, 2019 $ 469,376 Increase due to deferral of revenue at period end 512,280 Decrease due to beginning contract liabilities recognized as revenue (469,376) Deferred revenue at December 31, 2019 $ 512,280 |
CORRECTION OF PREVIOUSLY-ISSU_2
CORRECTION OF PREVIOUSLY-ISSUED UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Tables) | 6 Months Ended |
Dec. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Operations | The following tables present the effects of the corrections to the condensed consolidated statements of operations and comprehensive loss for the three and six months ended December 31, 2018 and the statement of cash flows for the six months ended December 31, 2018. Unaudited consolidated statement of operations Three months ended December 31, 2018 (As reported) (Adjustment) (Restated) Revenue from operations (net) $ 10,687,036 $ - $ 10,687,036 Cost of goods sold, exclusive of depreciation & amortization shown below 3,059,136 - 3,059,136 Selling and marketing 3,431,157 - 3,431,157 General and administrative 2,520,281 358,333 2,878,614 Research and development 1,759,560 - 1,759,560 Depreciation and amortization 1,992,534 42,826 2,035,360 Total operating expense 9,703,532 401,159 10,104,691 Loss from operations (2,075,632) (401,159) (2,476,791) Other loss (599,627) - (599,627) Loss before income taxes (2,675,259) (401,159) (3,076,418) Benefit from income taxes - 713,526 713,526 Net loss (2,675,259) 312,367 (2,362,892) Net loss non-controlling interest (33,454) - (33,454) Net loss controlling interest $ (2,641,805) $ 312,367 $ (2,329,438) Loss per common share Basic and diluted $ (0.01) $ - $ (0.01) Average common shares Basic and diluted 230,111,417 33,167,000 263,278,417 Six months ended December 31, 2018 (As reported) (Adjustment) (Restated) Revenue from operations (net) $ 18,750,838 $ - $ 18,750,838 Cost of goods sold, exclusive of depreciation & amortization shown below 5,925,871 181,821 6,107,692 Selling and marketing 5,853,876 (15,283) 5,838,593 General and administrative 5,079,761 465,001 5,544,762 Research and development 2,364,950 694 2,365,644 Depreciation and amortization 3,664,964 36,118 3,701,082 Total operating expense 16,963,551 486,530 17,450,081 Loss from operations (4,138,584) (668,351) (4,806,935) Other loss (913,986) - (913,986) Loss before income taxes (5,052,570) (668,351) (5,720,921) Benefit from income taxes - 1,325,978 1,325,978 Net loss (5,052,570) 657,627 (4,394,943) Net loss non-controlling interest (61,123) - (61,123) Net loss controlling interest $ (4,991,447) $ 657,627 $ (4,333,820) Loss per common share Basic and diluted $ (0.02) $ - $ (0.02) Average common shares Basic and diluted 230,111,417 28,561,565 258,672,982 |
Schedule of Cash flows | Unaudited consolidated statement of cash flows Six months ended December 31, 2018 (As reported) (Adjustment) (Restated) Cash flows from operating activities: Net loss $ (5,052,570) $ 657,627 $ (4,394,943) Adjustments to reconcile net loss to net cash provided by operating activities: Depreciation and amortization 3,663,973 36,118 3,700,091 Share based compensation 1,308,318 674,536 1,982,854 Deferred income taxes - (1,325,978) (1,325,978) Losses on equity method investment 914,898 - 914,898 Changes in operating assets and liabilities: Accounts receivable (29,650) - (29,650) Inventory (121,072) - (121,072) Prepaid expenses (21,309) - (21,309) Other assets (6,569) - (6,569) Accounts payable 1,345,996 - 1,345,996 Accrued liabilities 14,315 - 14,315 Net cash provided by operating activities 2,016,330 42,303 2,058,633 Cash flows from investing activities: Purchases of property and equipment (1,204,756) - (1,204,756) Cash acquired from acquisitions, net - 799,980 799,980 Cash payments on stock subscription - (1,184,392) (1,184,392) Capitalization of patent acquisition costs (140,675) - (140,675) Net cash used in investing activities (1,345,431) (384,412) (1,729,843) Cash flows from financing activities: Cash proceeds from stock subscriptions 1,025,000 - 1,025,000 Cash acquired from acquisitions, net 799,980 (799,980) - Cash payments on stock subscription (1,142,089) 1,142,089 - Net cash provided by financing activities 682,891 342,109 1,025,000 Net increase in cash and cash equivalents 1,353,790 - 1,353,790 Cash and cash equivalents at the beginning of the period $ 1,206,139 $ - $ 1,206,139 Cash and cash equivalents at the end of the period $ 2,559,929 $ - $ 2,559,929 |
BUSINESS COMBINATIONS AND ASS_2
BUSINESS COMBINATIONS AND ASSET ACQUISITIONS (Tables) | 6 Months Ended |
Dec. 31, 2019 | |
Business Combinations [Abstract] | |
Summary of Purchase Price Allocation | The stock price on August 22, 2018 was $0.92 per share, indicating a purchase price of $14,260,000 requiring allocation: Assets: Amount Cash $ 799,980 Lab equipment 1,177,750 Investment in non-controlling interest 440,000 Trade secrets 11,842,270 Total purchase price $ 14,260,000 |
Schedule of Fair Value of Warrants Determined Inputs Black Scholes Model | The fair value of the warrants was determined using the following inputs to the Black Scholes model: Risk-free interest rate 2.7% Expected dividend yield 0% Expected life (in years) 5.0 Expected volatility 150% |
Schdedule of Fair Value of Assets and Liabilities | Management estimated the fair value of tangible and intangible assets and liabilities in accordance with the applicable accounting guidance for business combinations and utilized the services of third-party valuation consultants. These amounts are provisional and may be adjusted during the measurement period, which expires no later than one year from the acquisition date, if new information is obtained that, if known, would have affected the amounts recognized as of the acquisition date. Assets: Fair Value Current assets $ 663,262 Laboratory equipment 190,397 Software 239,000 Intangible Assets 311,000 Total assets acquired 1,403,659 Liabilities: Accrued liabilities (68,181) Capital lease obligation (54,291) Total liabilities assumed (122,472) Bargain purchase gain (363,676) Total fair value of purchase price $ 917,511 Consideration allocated to Preeclampsia Option 100,000 Total consideration $ 1,017,511 Less: Cash acquired (85,694) Total consideration transferred $ 931,817 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 6 Months Ended |
Dec. 31, 2019 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories | The composition of inventories is as follows: As of As of December 31, June 30, 2019 2019 Finished goods $ 1,896,878 $ 918,199 Work-in-process 1,747,321 4,485,349 Raw materials and supplies 200,902 371,637 Total inventory on hand $ 3,845,101 $ 5,775,185 |
PROPERTY, PLANT AND EQUIPMENT_2
PROPERTY, PLANT AND EQUIPMENT, NET (Tables) | 6 Months Ended |
Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property, Plant And Equipment, Net | The composition of property, plant, and equipment is as follows: As of As of December 31, June 30, 2019 2019 Computer equipment $ 647,500 $ 530,815 Furniture 230,747 224,324 Lab equipment 2,210,695 2,469,652 Software 928,369 923,369 Leasehold improvements 997,416 870,098 Other fixed assets in progress 183,937 69,886 Lab equipment subject to finance lease 2,774,907 2,774,907 Total property, plant, and equipment 7,973,571 7,863,051 Accumulated depreciation (1,487,354) (862,851) Accumulated depreciation leased assets (329,857) (25,759) Property, plant and equipment, net $ 6,156,360 $ 6,974,441 |
GOODWILL & INTANGIBLE ASSETS (T
GOODWILL & INTANGIBLE ASSETS (Tables) | 6 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets Primarily Consist of Amortizable Purchased Licenses, Patents, and Trade Secrets | Intangible assets primarily consist of amortizable purchased licenses, patents, and trade secrets. The following summarizes the amounts reported as intangible assets: Carrying Amount Accumulated Amortization Net Weighted Average Remaining Amortization Period (Years) At December 31, 2019: Licenses $ 21,337,981 $ (4,274,459) $ 17,063,522 8.5 Patents 9,750,000 (3,281,863) 6,468,137 8.5 Trade Secrets 56,675,936 (14,368,767) 42,307,169 8.5 Other 411,000 (73,474) 337,526 10.5 Goodwill 5,254,451 N/A 5,254,451 N/A Total intangible assets $ 93,429,368 $ (21,998,563) $ 71,430,805 8.5 Carrying Amount Accumulated Amortization Net Weighted Average Remaining Amortization Period (Years) At June 30, 2019: Licenses $ 21,337,981 $ (3,275,666) $ 18,062,315 9.0 Patents 9,750,000 (2,899,510) 6,850,490 9.0 Trade Secrets 56,675,936 (11,339,601) 45,336,335 8.9 Other 411,000 (27,069) 383,931 11.0 Goodwill 5,254,451 N/A 5,254,451 N/A Total intangible assets $ 93,429,368 $ (17,541,846) $ 75,887,522 9.0 |
Schedule of Estimated Amortization Expense | Estimated future amortization expense related to intangible assets consists of the following as of December 31, 2019: Year Ending June 30 Amount 2020 $ 4,452,050 2021 8,514,306 2022 6,022,890 2023 6,022,890 2024 6,022,890 Thereafter 35,141,328 |
Schedule of Fair Value of Warrants Determined Inputs Black Scholes Model | The fair value of the replacement warrants were determined using the following inputs to the Black Scholes model: Risk-free interest rate 2.7% Expected dividend yield 0% Expected life (in years) 5.0 Expected volatility 150% |
EQUITY METHOD INVESTMENT (Table
EQUITY METHOD INVESTMENT (Tables) | 6 Months Ended |
Dec. 31, 2019 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Summary of Investment | The Companys investment in Juneau is accounted for under the equity method and included in the Diagnostics and Therapeutics segment. The following table summarizes the investment: As of December 31, As of June 30, Carrying amount $ 35,329,167 $ 51,717,719 Ownership percentage 48.3% 48.4% |
Schedule of Provision for Subscription Agreement | The schedule of payments as of December 31, 2019 under the amended agreement is as follows: Year Ending June 30 Amount 2020 $ 1,330,000 2021 1,800,000 2022 5,300,000 2023 1,256,610 $ 9,686,610 |
Summary of Financial Information | Summarized financial information for the Companys equity method investee as of and for its fiscal year end is presented in the following tables: Juneau Biosciences, LLC Year ended December 31, 2019 Year ended December 31, 2018 Unaudited Revenue (related party) $ 202,010 $ 2,554,037 Gross profit 202,010 2,554,037 Loss from operations (1,890,382) (2,419,890) Net loss (1,889,921) (2,419,824) Net loss attributable to Predictive Technology Group, Inc. (912,454) (1,200,238) |
ACCRUED LIABILITIES (Tables)
ACCRUED LIABILITIES (Tables) | 6 Months Ended |
Dec. 31, 2019 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Liabilities | As of As of December 31, June 30, 2019 2019 Employee compensation and benefits $ 888,911 $ 816,451 Other 1,042,907 1,041,320 Total accrued liabilities $ 1,931,818 $ 1,857,771 |
STOCKHOLDER'S EQUITY (Tables)
STOCKHOLDER'S EQUITY (Tables) | 6 Months Ended |
Dec. 31, 2019 | |
Schedule of Summary of Warrant Activity | A summary of option activity is as follows for the six months ended December 31, 2019: Number of shares Weighted average exercise price Options outstanding at June 30, 2019 24,407,750 $ 1.74 Options granted 2,595,800 1.40 Less: Options exercised - - Options canceled or expired (1,082,500) 1.65 Options outstanding at end of period 25,921,050 $ 1.72 |
Warrants [Member] | |
Schedule of Summary of Warrant Activity | The following is a summary of warrant activity from June 30, 2019 through December 31, 2019: Number of Warrants Weighted Average Exercise Price Weighted Average Remaining Contractual Life (Years) Warrant: Outstanding June 30, 2019 68,253,520 $ 0.78 3.6 Granted 1,250,000 1.73 9.7 Exercised (9,223,605) 0.50 2.7 Forfeited/ Cancelled (1,836,395) 0.50 2.7 Outstanding December 31, 2019 58,443,520 $ 0.85 3.3 |
EARNINGS PER COMMON SHARE (EP_2
EARNINGS PER COMMON SHARE (EPS) (Tables) | 6 Months Ended |
Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |
Schedule of Weighted Shares Outstanding and Basic and Diluted Earnings Per Share | The computation of weighted average shares outstanding and the basic and diluted earnings per common share for the following periods consisted of the following: Net Average Shares Per Share Loss Outstanding Amount Three months ended December 31, 2019 Basic and diluted EPS attributable to common shareholders $(26,002,669) 283,126,298 $(0.09) Three months ended December 31, 2018 Basic and diluted EPS attributable to common shareholders $(2,329,438) 263,278,417 $(0.01) Six months ended December 31, 2019 Basic and diluted EPS attributable to common shareholders $(33,867,276) 282,203,748 $(0.12) Six months ended December 31, 2018 Basic and diluted EPS attributable to common shareholders $(4,333,820) 258,672,982 $(0.02) |
Schedule of Anti Dilutive Securities | Potentially dilutive securities that would be excluded from the calculation of diluted net loss per common share because to include them would be anti-dilutive are as follows: As of December 31, 2019 2018 Warrants for common stock 58,443,520 64,993,520 Options for common stock 25,921,050 6,446,250 84,364,570 71,439,770 |
STOCK OPTION PLAN (Tables)
STOCK OPTION PLAN (Tables) | 6 Months Ended |
Dec. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Summary of Option Activity | A summary of option activity is as follows for the six months ended December 31, 2019: Number of shares Weighted average exercise price Options outstanding at June 30, 2019 24,407,750 $ 1.74 Options granted 2,595,800 1.40 Less: Options exercised - - Options canceled or expired (1,082,500) 1.65 Options outstanding at end of period 25,921,050 $ 1.72 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 6 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Lease Payments Under Operating And Capital Leases | The table below presents the future minimum lease payments under operating and finance leases: Year Ending June 30, Operating Finance Total 2020 $ 476,816 $ 393,090 $ 869,906 2021 979,071 748,361 1,727,432 2022 246,888 740,797 987,685 2023 - 167,719 167,719 2024 - - - Total cash payments 1,702,775 2,049,967 3,752,742 Less: Imputed interest (128,619) (214,844) (343,463) Total lease liability $ 1,574,156 $ 1,835,123 $ 3,409,279 |
Schedule of Lease Information | Lease information for the three months ended December 31, 2019 is as follows: Three months ended December 31, 2019 Six months ended December 31, 2019 Lease cost Finance lease cost Amortization of right of use assets $ 156,057 $ 180,469 Interest on lease liabilities 40,488 44,901 Operating lease cost 223,051 327,455 Short-term lease cost 450 64,787 Total lease cost $ 420,046 $ 617,612 Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from finance leases $ 40,488 $ 44,901 Operating cash flows from operating leases 224,088 329,517 Financing cash flows from finance leases 156,057 180,469 Weighted average remaining lease term finance leases (Years) 2.61 Weighted average remaining lease term operating leases (Years) 1.75 Weighted average discount rate finance leases 8.06% Weighted average discount rate operating leases 8.63% |
SUBSEQUENT EVENTS (Tables)
SUBSEQUENT EVENTS (Tables) | 6 Months Ended |
Dec. 31, 2019 | |
Subsequent Events [Abstract] | |
Schedule of Payments Due Under Subscription Agreement to Purchase Units of Juneau | The pro forma schedule of payments as of December 31, 2019 under the amended agreement is as follows, with the Equity Payment included in the amount shown for the fiscal year ended June 30, 2020: Year Ending June 30 Amount 2020 $ 3,030,000 2021 4,600,000 2022 2,056,610 $ 9,686,610 |
BUSINESS DESCRIPTION AND SIGN_4
BUSINESS DESCRIPTION AND SIGNIFICANT ACCOUNTING POLICIES (Schedule of Segment Reporting) (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | |
Segment Reporting Information [Line Items] | ||||
Revenues | $ 7,336,640 | $ 10,687,036 | $ 15,595,898 | $ 18,750,838 |
Depreciation and amortization | 2,775,073 | 2,035,360 | 5,385,318 | 3,701,082 |
Share based compensation | 4,634,069 | 1,010,505 | 9,628,669 | 1,982,854 |
Segment operating loss | (13,727,402) | (2,476,791) | (26,619,576) | (4,806,935) |
HCT/Ps [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 7,289,265 | 10,687,036 | 15,473,896 | 18,750,838 |
Depreciation and amortization | 937,923 | 771,416 | 1,836,868 | 1,512,884 |
Share based compensation | 1,242,875 | 316,089 | 2,914,331 | 371,838 |
Segment operating loss | (7,067,094) | (507,527) | (13,611,080) | (838,369) |
Diagnostics and therapeutics [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 47,375 | 122,002 | ||
Depreciation and amortization | 1,756,560 | 1,181,317 | 3,387,858 | 2,012,840 |
Share based compensation | 254,353 | 8,186 | 704,454 | 8,186 |
Segment operating loss | (3,261,117) | (1,249,673) | (6,489,756) | (2,216,214) |
Unallocated Corporate [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | ||||
Depreciation and amortization | 80,590 | 82,627 | 160,592 | 175,358 |
Share based compensation | 3,136,841 | 686,230 | 6,009,884 | 1,602,830 |
Segment operating loss | $ (3,399,191) | $ (719,591) | $ (6,518,740) | $ (1,752,352) |
BUSINESS DESCRIPTION AND SIGN_5
BUSINESS DESCRIPTION AND SIGNIFICANT ACCOUNTING POLICIES (Schedule of Operating Income (Loss)) (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
Total operating loss for reportable segments | $ (13,727,402) | $ (2,476,791) | $ (26,619,576) | $ (4,806,935) |
Unallocated amounts: | ||||
Unallocated Corporate | (3,399,191) | (719,591) | (6,518,740) | (1,752,352) |
Other loss | (16,546,988) | (599,627) | (16,759,770) | (913,986) |
Loss before income taxes | $ (30,274,390) | $ (3,076,418) | $ (43,379,346) | $ (5,720,921) |
BUSINESS DESCRIPTION AND SIGN_6
BUSINESS DESCRIPTION AND SIGNIFICANT ACCOUNTING POLICIES (Schedule of Assets) (Details) - USD ($) | Dec. 31, 2019 | Jun. 30, 2019 |
Total Assets | $ 119,214,242 | $ 143,578,185 |
HCT/Ps [Member] | ||
Total Assets | 16,302,925 | 21,052,082 |
Diagnostics and therapeutics [Member] | ||
Total Assets | 101,442,833 | 120,665,445 |
Unallocated Corporate [Member] | ||
Total Assets | $ 1,468,484 | $ 1,860,658 |
BUSINESS DESCRIPTION AND SIGN_7
BUSINESS DESCRIPTION AND SIGNIFICANT ACCOUNTING POLICIES (Schedule of Deferred Revenue) (Details) | 6 Months Ended |
Dec. 31, 2019USD ($) | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Deferred revenue at June 30, 2019 | $ 469,376 |
Increase due to deferral of revenue at period end | 512,280 |
Decrease due to beginning contract liabilities recognized as revenue | (469,376) |
Deferred revenue at December 31, 2019 | $ 512,280 |
BUSINESS DESCRIPTION AND SIGN_8
BUSINESS DESCRIPTION AND SIGNIFICANT ACCOUNTING POLICIES (Narrative) (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Property, Plant and Equipment [Line Items] | ||||||
Cash and cash equivalents | $ 255,502 | $ 2,559,929 | $ 255,502 | $ 2,559,929 | $ 1,618,244 | $ 1,206,139 |
Working capital | 4,861,267 | 4,861,267 | ||||
Patents, net of amortization | 6,468,137 | 6,468,137 | $ 6,850,490 | |||
Impairment charge on intangible assets | 15,932,016 | |||||
Net loss | $ 26,002,669 | $ 2,329,438 | 33,867,276 | 4,333,820 | ||
Net cash outflows from operations | $ 9,914,968 | $ (2,058,633) | ||||
Lab Equipment [Member] | ||||||
Property, Plant and Equipment [Line Items] | ||||||
Useful Life | 5 years | |||||
Furniture [Member] | Minimum [Member] | ||||||
Property, Plant and Equipment [Line Items] | ||||||
Useful Life | 5 years | |||||
Furniture [Member] | Maximum [Member] | ||||||
Property, Plant and Equipment [Line Items] | ||||||
Useful Life | 7 years | |||||
Computer Equipment [Member] | ||||||
Property, Plant and Equipment [Line Items] | ||||||
Useful Life | 3 years |
CORRECTION OF PREVIOUSLY-ISSU_3
CORRECTION OF PREVIOUSLY-ISSUED UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Narrative) (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Jun. 30, 2017 | |
Benefit from income taxes | $ (4,239,780) | $ (713,526) | $ (9,448,195) | $ (1,325,978) | |
Share based compensation expense | 4,634,069 | 1,010,505 | 9,628,669 | 1,982,854 | |
Amortization expense related to intangible assets | $ 2,228,359 | $ 1,909,480 | 4,456,717 | $ 3,492,069 | |
Weighted average shares outstanding | 33,167,000 | 28,561,565 | 23,127,666 | ||
Cash payments on equity method investee stock subscription | $ 470,000 | $ 1,184,392 | |||
Previously reported [Member] | |||||
Benefit from income taxes | $ 713,526 | 1,325,978 | |||
Share based compensation expense | 358,333 | 632,233 | |||
Amortization expense related to intangible assets | $ 42,826 | 36,118 | |||
Cash payments on stock subscription | $ 1,142,089 |
CORRECTION OF PREVIOUSLY-ISSU_4
CORRECTION OF PREVIOUSLY-ISSUED UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Schedule of Operations) (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||||
Dec. 31, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | |
Revenue from operations (net) | $ 7,336,640 | $ 10,687,036 | $ 15,595,898 | $ 18,750,838 | ||
Cost of goods sold, exclusive of depreciation & amortization shown below: | 5,840,256 | 3,059,136 | 13,022,246 | 6,107,692 | ||
Selling and marketing | 3,049,593 | 3,431,157 | 6,201,563 | 5,838,593 | ||
General and administrative | 7,034,770 | 2,878,614 | 13,413,647 | 5,544,762 | ||
Research and development | 2,364,350 | 1,759,560 | 4,192,700 | 2,365,644 | ||
Depreciation and amortization | 2,775,073 | 2,035,360 | 5,385,318 | 3,701,082 | ||
Total operating expenses | 15,223,786 | 10,104,691 | 29,193,228 | 17,450,081 | ||
Operating loss | (13,727,402) | (2,476,791) | (26,619,576) | (4,806,935) | ||
Other loss | (16,546,988) | (599,627) | (16,759,770) | (913,986) | ||
Loss before income taxes | (30,274,390) | (3,076,418) | (43,379,346) | (5,720,921) | ||
Benefit from income taxes | (4,239,780) | (713,526) | (9,448,195) | (1,325,978) | ||
Net loss | (26,034,610) | $ (7,896,541) | (2,362,892) | $ (2,032,051) | (33,931,151) | (4,394,943) |
Net loss non-controlling interest | (31,941) | (33,454) | (63,875) | (61,123) | ||
Net loss controlling interest | $ (26,002,669) | $ (2,329,438) | $ (33,867,276) | $ (4,333,820) | ||
Loss per common share Basic and diluted | $ (0.09) | $ (0.01) | $ (0.12) | $ (0.02) | ||
Average common shares Basic & diluted | 283,126,298 | 263,278,417 | 282,203,748 | 258,672,982 | ||
As Reported [Member] | ||||||
Revenue from operations (net) | $ 10,687,036 | $ 18,750,838 | ||||
Cost of goods sold, exclusive of depreciation & amortization shown below: | 3,059,136 | 5,925,871 | ||||
Selling and marketing | 3,431,157 | 5,853,876 | ||||
General and administrative | 2,520,281 | 5,079,761 | ||||
Research and development | 1,759,560 | 2,364,950 | ||||
Depreciation and amortization | 1,992,534 | 3,664,964 | ||||
Total operating expenses | 9,703,532 | 16,963,551 | ||||
Operating loss | (2,075,632) | (4,138,584) | ||||
Other loss | (599,627) | (913,986) | ||||
Loss before income taxes | (2,675,259) | (5,052,570) | ||||
Benefit from income taxes | ||||||
Net loss | (2,675,259) | (5,052,570) | ||||
Net loss non-controlling interest | (33,454) | (61,123) | ||||
Net loss controlling interest | $ (2,641,805) | $ (4,991,447) | ||||
Loss per common share Basic and diluted | $ (0.01) | $ (0.02) | ||||
Average common shares Basic & diluted | 230,111,417 | 230,111,417 | ||||
Adjustment [Member] | ||||||
Revenue from operations (net) | ||||||
Cost of goods sold, exclusive of depreciation & amortization shown below: | 181,821 | |||||
Selling and marketing | (15,283) | |||||
General and administrative | 358,333 | 465,001 | ||||
Research and development | 694 | |||||
Depreciation and amortization | 42,826 | 36,118 | ||||
Total operating expenses | 401,159 | 486,530 | ||||
Operating loss | (401,159) | (668,351) | ||||
Other loss | ||||||
Loss before income taxes | (401,159) | (668,351) | ||||
Benefit from income taxes | 713,526 | 1,325,978 | ||||
Net loss | 312,367 | 657,627 | ||||
Net loss non-controlling interest | ||||||
Net loss controlling interest | $ 312,367 | $ 657,627 | ||||
Loss per common share Basic and diluted | $ 0 | $ 0 | ||||
Average common shares Basic & diluted | 33,167,000 | 28,561,565 | ||||
Restated [Member] | ||||||
Revenue from operations (net) | $ 10,687,036 | $ 18,750,838 | ||||
Cost of goods sold, exclusive of depreciation & amortization shown below: | 3,059,136 | 6,107,692 | ||||
Selling and marketing | 3,431,157 | 5,838,593 | ||||
General and administrative | 2,878,614 | 5,544,762 | ||||
Research and development | 1,759,560 | 2,365,644 | ||||
Depreciation and amortization | 2,035,360 | 3,701,082 | ||||
Total operating expenses | 10,104,691 | 17,450,081 | ||||
Operating loss | (2,476,791) | (4,806,935) | ||||
Other loss | (599,627) | (913,986) | ||||
Loss before income taxes | (3,076,418) | (5,720,921) | ||||
Benefit from income taxes | 713,526 | 1,325,978 | ||||
Net loss | (2,362,892) | (4,394,943) | ||||
Net loss non-controlling interest | (33,454) | (61,123) | ||||
Net loss controlling interest | $ (2,329,438) | $ (4,333,820) | ||||
Loss per common share Basic and diluted | $ (0.01) | $ (0.02) | ||||
Average common shares Basic & diluted | 263,278,417 | 258,672,982 |
CORRECTION OF PREVIOUSLY-ISSU_5
CORRECTION OF PREVIOUSLY-ISSUED UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Schedule of Cash Flow) (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||||
Dec. 31, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | |
Cash flows from operating activities: | ||||||
Net loss | $ (26,034,610) | $ (7,896,541) | $ (2,362,892) | $ (2,032,051) | $ (33,931,151) | $ (4,394,943) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||||||
Depreciation and amortization | 546,714 | 125,880 | 5,385,318 | 3,700,091 | ||
Share based compensation | 4,634,069 | 1,010,505 | 9,628,669 | 1,982,854 | ||
Deferred income taxes | (9,478,300) | (1,325,978) | ||||
Losses on equity method investment | (16,249,252) | (600,116) | (16,388,552) | (914,898) | ||
Changes in operating assets and liabilities: | ||||||
Accounts receivable | (635,982) | 29,650 | ||||
Inventory | (1,930,084) | 121,072 | ||||
Prepaid expenses | 114,144 | 21,309 | ||||
Other assets | (52,532) | 6,569 | ||||
Accounts Payable | (707,469) | 1,345,996 | ||||
Accrued liabilities | 74,047 | 14,315 | ||||
Net cash provided by (used in) operating activities | (9,914,968) | 2,058,633 | ||||
Cash flows from investing activities: | ||||||
Purchases of property and equipment | (476,856) | (1,204,756) | ||||
Cash acquired from acquisitions, net | 799,980 | |||||
Common stock issued for acquisition | 14,260,000 | 14,260,000 | ||||
Cash payments on stock subscription | 470,000 | 1,184,392 | ||||
Capitalization of patent acquisition costs | 140,675 | |||||
Net cash provided by (used in) investing activities | (946,856) | (1,729,843) | ||||
Cash flows from financing activities: | ||||||
Cash proceeds from stock subscriptions | 1,025,000 | |||||
Net cash provided by financing activities | 9,499,082 | 1,025,000 | ||||
Net increase in cash and cash equivalents | (1,362,742) | 1,353,790 | ||||
Cash and cash equivalents at the beginning of the period | $ 1,618,244 | 1,206,139 | 1,618,244 | 1,206,139 | ||
Cash and cash equivalents at the end of the period | $ 255,502 | 2,559,929 | $ 255,502 | 2,559,929 | ||
As Reported [Member] | ||||||
Cash flows from operating activities: | ||||||
Net loss | (2,675,259) | (5,052,570) | ||||
Adjustments to reconcile net loss to net cash provided by operating activities: | ||||||
Depreciation and amortization | 3,663,973 | |||||
Share based compensation | 1,308,318 | |||||
Deferred income taxes | ||||||
Losses on equity method investment | 914,898 | |||||
Changes in operating assets and liabilities: | ||||||
Accounts receivable | (29,650) | |||||
Inventory | (121,072) | |||||
Prepaid expenses | (21,309) | |||||
Other assets | (6,569) | |||||
Accounts Payable | 1,345,996 | |||||
Accrued liabilities | 14,315 | |||||
Net cash provided by (used in) operating activities | 2,016,330 | |||||
Cash flows from investing activities: | ||||||
Purchases of property and equipment | (1,204,756) | |||||
Cash acquired from acquisitions, net | ||||||
Cash payments on stock subscription | ||||||
Capitalization of patent acquisition costs | (140,675) | |||||
Net cash provided by (used in) investing activities | (1,345,431) | |||||
Cash flows from financing activities: | ||||||
Cash proceeds from stock subscriptions | 1,025,000 | |||||
Cash acquired from acquisitions, net | 799,980 | |||||
Cash payments on stock subscription | (1,142,089) | |||||
Net cash provided by financing activities | 682,891 | |||||
Net increase in cash and cash equivalents | 1,353,790 | |||||
Cash and cash equivalents at the beginning of the period | 1,206,139 | 1,206,139 | ||||
Cash and cash equivalents at the end of the period | 2,559,929 | 2,559,929 | ||||
Adjustment [Member] | ||||||
Cash flows from operating activities: | ||||||
Net loss | 312,367 | 657,627 | ||||
Adjustments to reconcile net loss to net cash provided by operating activities: | ||||||
Depreciation and amortization | 36,118 | |||||
Share based compensation | 674,536 | |||||
Deferred income taxes | (1,325,978) | |||||
Losses on equity method investment | ||||||
Changes in operating assets and liabilities: | ||||||
Accounts receivable | ||||||
Inventory | ||||||
Prepaid expenses | ||||||
Other assets | ||||||
Accounts Payable | ||||||
Accrued liabilities | ||||||
Net cash provided by (used in) operating activities | 42,303 | |||||
Cash flows from investing activities: | ||||||
Purchases of property and equipment | ||||||
Cash acquired from acquisitions, net | 799,980 | |||||
Cash payments on stock subscription | (1,184,392) | |||||
Capitalization of patent acquisition costs | ||||||
Net cash provided by (used in) investing activities | (384,412) | |||||
Cash flows from financing activities: | ||||||
Cash proceeds from stock subscriptions | ||||||
Cash acquired from acquisitions, net | (799,980) | |||||
Cash payments on stock subscription | 1,142,089 | |||||
Net cash provided by financing activities | 342,109 | |||||
Net increase in cash and cash equivalents | ||||||
Cash and cash equivalents at the beginning of the period | ||||||
Cash and cash equivalents at the end of the period | ||||||
Restated [Member] | ||||||
Cash flows from operating activities: | ||||||
Net loss | (2,362,892) | (4,394,943) | ||||
Adjustments to reconcile net loss to net cash provided by operating activities: | ||||||
Depreciation and amortization | 3,700,091 | |||||
Share based compensation | 1,982,854 | |||||
Deferred income taxes | (1,325,978) | |||||
Losses on equity method investment | 914,898 | |||||
Changes in operating assets and liabilities: | ||||||
Accounts receivable | (29,650) | |||||
Inventory | (121,072) | |||||
Prepaid expenses | (21,309) | |||||
Other assets | (6,569) | |||||
Accounts Payable | 1,345,996 | |||||
Accrued liabilities | 14,315 | |||||
Net cash provided by (used in) operating activities | 2,058,633 | |||||
Cash flows from investing activities: | ||||||
Purchases of property and equipment | (1,204,756) | |||||
Cash acquired from acquisitions, net | 799,980 | |||||
Cash payments on stock subscription | (1,184,392) | |||||
Capitalization of patent acquisition costs | (140,675) | |||||
Net cash provided by (used in) investing activities | (1,729,843) | |||||
Cash flows from financing activities: | ||||||
Cash proceeds from stock subscriptions | 1,025,000 | |||||
Cash acquired from acquisitions, net | ||||||
Cash payments on stock subscription | ||||||
Net cash provided by financing activities | 1,025,000 | |||||
Net increase in cash and cash equivalents | 1,353,790 | |||||
Cash and cash equivalents at the beginning of the period | $ 1,206,139 | 1,206,139 | ||||
Cash and cash equivalents at the end of the period | $ 2,559,929 | $ 2,559,929 |
BUSINESS COMBINATIONS AND ASS_3
BUSINESS COMBINATIONS AND ASSET ACQUISITIONS (Narrative) (Details) - USD ($) | 1 Months Ended | 6 Months Ended | |||
Mar. 22, 2019 | Dec. 19, 2018 | Aug. 22, 2018 | Dec. 31, 2019 | Jun. 30, 2019 | |
Business Acquisition [Line Items] | |||||
Goodwill | $ 5,254,451 | $ 5,254,451 | |||
Trade Secrets [Member] | |||||
Business Acquisition [Line Items] | |||||
Deferred tax liability | 4,620,000 | ||||
Increased decreased in carrying amount of trade secrets | $ 18,480,000 | ||||
Inception DX, LLC [Member] | |||||
Business Acquisition [Line Items] | |||||
Share price | $ 0.92 | ||||
Share issued | 15,500,000 | ||||
Juneau Bioscience, LLC [Member] | |||||
Business Acquisition [Line Items] | |||||
Number of Units issued | 400,000 | ||||
Unit price | $ 1.10 | ||||
Estimated life of equipment | 5 years | ||||
Juneau Bioscience, LLC [Member] | Trade Secrets [Member] | |||||
Business Acquisition [Line Items] | |||||
Estimated life of equipment | 15 years | ||||
Taueret Laboratories, LLC [Member] | |||||
Business Acquisition [Line Items] | |||||
Warrant issued exercisable | 16,500,000 | ||||
Fair value of warrants | $ 13,860,000 | ||||
Taueret Laboratories, LLC [Member] | Trade Secrets [Member] | |||||
Business Acquisition [Line Items] | |||||
Estimated life of equipment | 15 years | ||||
Regenerative Medical Technologies, Inc [Member] | |||||
Business Acquisition [Line Items] | |||||
Share price | $ 0.92 | ||||
Share issued | 10,000,000 | ||||
Deferred tax liability | $ 3,066,667 | ||||
Acquisition cost | $ 12,266,667 | ||||
Regenerative Medical Technologies, Inc [Member] | Trade Secrets [Member] | |||||
Business Acquisition [Line Items] | |||||
Estimated life of equipment | 10 years | ||||
Taueret Laboratories, LLC Acquisition [Member] | |||||
Business Acquisition [Line Items] | |||||
Share issued | 552,995 | ||||
Fair of common stock paid consideration | $ 931,817 | ||||
Additional payment, cash | 8,547,000 | ||||
Cash Acquired | $ 85,694 | ||||
Percentage of discount | 20.00% | ||||
Amount of allocated fair value | $ 917,511 | ||||
Taueret Laboratories, LLC Acquisition [Member] | Licensing Agreements [Member] | |||||
Business Acquisition [Line Items] | |||||
Estimated life of equipment | 15 years | ||||
Percentage of discount | 22.00% | ||||
Estimated fair value of intangible assets | $ 295,000 | ||||
Taueret Laboratories, LLC Acquisition [Member] | Customer Relationships [Member] | |||||
Business Acquisition [Line Items] | |||||
Estimated life of equipment | 5 years | ||||
Estimated fair value of intangible assets | $ 16,000 | ||||
Preeclampsia Option [Member] | |||||
Business Acquisition [Line Items] | |||||
Amount of allocated fair value | 100,000 | ||||
Estimated fair value of intangible assets | $ 239,000 |
BUSINESS COMBINATIONS AND ASS_4
BUSINESS COMBINATIONS AND ASSET ACQUISITIONS (Details) - DX, LLC [Member] | 6 Months Ended |
Dec. 31, 2019USD ($) | |
Business Acquisition [Line Items] | |
Cash | $ 799,980 |
Lab equipment | 1,177,750 |
Investment in non-controlling interest | 440,000 |
Trade secrets | 11,842,270 |
Total purchase price | $ 14,260,000 |
BUSINESS COMBINATIONS AND ASS_5
BUSINESS COMBINATIONS AND ASSET ACQUISITIONS (Schedule of Fair Value of Warrants) (Details) | 1 Months Ended | |
Dec. 31, 2018 | Aug. 22, 2018 | |
Risk Free Interest Rate [Member] | ||
Business Acquisition [Line Items] | ||
Fair value of warrants determined inputs to the Black Scholes model | 2.7% | 2.7% |
Expected Dividend Yield [Member] | ||
Business Acquisition [Line Items] | ||
Fair value of warrants determined inputs to the Black Scholes model | 0% | 0% |
Expected life [Member] | ||
Business Acquisition [Line Items] | ||
Fair value of warrants determined inputs to the Black Scholes model | 5.0 | 5.0 |
Expected Volatility [Member] | ||
Business Acquisition [Line Items] | ||
Fair value of warrants determined inputs to the Black Scholes model | 150% | 150% |
BUSINESS COMBINATIONS AND ASS_6
BUSINESS COMBINATIONS AND ASSET ACQUISITIONS (Schdedule of Fair Value of Assets and Liabilities) (Details) - Taueret Laboratories, LLC Acquisition [Member] | 1 Months Ended |
Mar. 22, 2019USD ($) | |
Assets | |
Current assets | $ 663,262 |
Laboratory equipment | 190,397 |
Software | 239,000 |
Intangible Assets | 311,000 |
Total assets acquired | 1,403,659 |
Liabilities: | |
Accrued liabilities | (68,181) |
Capital lease obligation | (54,291) |
Total liabilities assumed | (122,472) |
Bargain purchase gain | (363,676) |
Total fair value of purchase price | 917,511 |
Consideration allocated to Preeclampsia Option | 100,000 |
Total consideration | 1,017,511 |
Less: Cash acquired | (85,694) |
Total purchase price | $ 931,817 |
INVENTORIES (Schedule of Invent
INVENTORIES (Schedule of Inventories) (Details) - USD ($) | Dec. 31, 2019 | Jun. 30, 2019 |
Inventory Disclosure [Abstract] | ||
Finished goods | $ 1,896,878 | $ 918,199 |
Work-in-process | 1,747,321 | 4,485,349 |
Raw materials and supplies | 200,902 | 371,637 |
Total inventory on hand | $ 3,845,101 | $ 5,775,185 |
PROPERTY, PLANT AND EQUIPMENT_3
PROPERTY, PLANT AND EQUIPMENT, NET (Narrative) (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | |
Property, Plant and Equipment [Abstract] | ||||
Depreciation expense | $ 546,714 | $ 125,880 | $ 5,385,318 | $ 3,700,091 |
PROPERTY, PLANT AND EQUIPMENT_4
PROPERTY, PLANT AND EQUIPMENT, NET (Schedule of Property, Plant And Equipment, Net) (Details) - USD ($) | Dec. 31, 2019 | Jun. 30, 2019 |
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment gross | $ 7,973,571 | $ 7,863,051 |
Accumulated depreciation | (1,487,354) | (862,851) |
Less accumulated depreciation | (329,857) | (25,759) |
Property, plant and equipment, net | 6,156,360 | 6,974,441 |
Computer Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment gross | 647,500 | 530,815 |
Furniture [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment gross | 230,747 | 224,324 |
Lab Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment gross | 2,210,695 | 2,469,652 |
Software [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment gross | 928,369 | 923,369 |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment gross | 997,416 | 870,098 |
Other fixed assets in progress [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment gross | 183,937 | 69,886 |
Lab equipment subject to finance lease [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment gross | $ 2,774,907 | $ 2,774,907 |
GOODWILL & INTANGIBLE ASSETS (N
GOODWILL & INTANGIBLE ASSETS (Narrative) (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||
Dec. 28, 2016 | Dec. 31, 2019 | Dec. 31, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | |
Acquired Indefinite-lived Intangible Assets [Line Items] | ||||||
Amortization expense | $ 2,228,359 | $ 1,909,480 | $ 4,456,717 | $ 3,492,069 | ||
Licensing Agreements [Member] | ||||||
Acquired Indefinite-lived Intangible Assets [Line Items] | ||||||
Additional license fee due and payable | $ 2,000,000 | $ 250,000 | $ 250,000 | |||
Profit received | 25,000,000 | |||||
Share value | 2,500,000 | |||||
Final milestone payment due | $ 250,000 | |||||
Percentage of royalty | 50.00% | 2.00% | ||||
Issuance of common stock | 1,000,000 | |||||
Warrants exercisable | 14,000,000 | |||||
Per share price common stock | $ 0.80 | |||||
Increase warrant exercise price | $ 0.90 | |||||
Decrease in assigned value of license | $ 4,449,211 | |||||
Deferred tax liability | $ 290,263 | 290,263 | ||||
Decrease in carrying value of licenses | $ 4,158,948 |
GOODWILL & INTANGIBLE ASSETS (S
GOODWILL & INTANGIBLE ASSETS (Schedule of Estimated Amortization Expense) (Details) - USD ($) | 6 Months Ended | 12 Months Ended |
Dec. 31, 2019 | Jun. 30, 2019 | |
Acquired Indefinite-lived Intangible Assets [Line Items] | ||
Gross carrying amount | $ 93,429,368 | $ 93,429,368 |
Accumulated Amortization | (21,998,563) | (17,541,846) |
Net | $ 71,430,805 | $ 75,887,522 |
Weighted Average Remaining Amortization Period (Years) | 8 years 6 months | 9 years |
Licenses [Member] | ||
Acquired Indefinite-lived Intangible Assets [Line Items] | ||
Gross carrying amount | $ 21,337,981 | $ 21,337,981 |
Accumulated Amortization | (4,274,459) | (3,275,666) |
Net | $ 17,063,522 | $ 18,062,315 |
Weighted Average Remaining Amortization Period (Years) | 8 years 6 months | 9 years |
Patents [Member] | ||
Acquired Indefinite-lived Intangible Assets [Line Items] | ||
Gross carrying amount | $ 9,750,000 | $ 9,750,000 |
Accumulated Amortization | (3,281,863) | (2,899,510) |
Net | $ 6,468,137 | $ 6,850,490 |
Weighted Average Remaining Amortization Period (Years) | 8 years 6 months | 9 years |
Trade Secrets [Member] | ||
Acquired Indefinite-lived Intangible Assets [Line Items] | ||
Gross carrying amount | $ 56,675,936 | $ 56,675,936 |
Accumulated Amortization | (14,368,767) | (11,339,601) |
Net | $ 42,307,169 | $ 45,336,335 |
Weighted Average Remaining Amortization Period (Years) | 8 years 6 months | 8 years 1 month 2 days |
Other Patents, Trade Secrets and Technologies [Member] | ||
Acquired Indefinite-lived Intangible Assets [Line Items] | ||
Gross carrying amount | $ 411,000 | $ 411,000 |
Accumulated Amortization | (73,474) | (27,069) |
Net | $ 337,526 | $ 383,931 |
Weighted Average Remaining Amortization Period (Years) | 10 years 6 months | 11 years |
Goodwill [Member] | ||
Acquired Indefinite-lived Intangible Assets [Line Items] | ||
Gross carrying amount | $ 5,254,451 | $ 5,254,451 |
Accumulated Amortization | ||
Net | $ 5,254,451 | $ 5,254,451 |
GOODWILL & INTANGIBLE ASSETS _2
GOODWILL & INTANGIBLE ASSETS (Schedule of Estimated Future Amortization Expense) (Details) | Jun. 30, 2019USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2020 | $ 4,452,050 |
2021 | 8,514,306 |
2022 | 6,022,890 |
2023 | 6,022,890 |
2024 | 6,022,890 |
Thereafter | $ 35,141,328 |
GOODWILL & INTANGIBLE ASSETS _3
GOODWILL & INTANGIBLE ASSETS (Schedule of Fair Value of Warrants) (Details) | 1 Months Ended | |
Dec. 31, 2018 | Aug. 22, 2018 | |
Risk Free Interest Rate [Member] | ||
Business Acquisition [Line Items] | ||
Fair value of warrants determined inputs to the Black Scholes model | 2.7% | 2.7% |
Expected Dividend Yield [Member] | ||
Business Acquisition [Line Items] | ||
Fair value of warrants determined inputs to the Black Scholes model | 0% | 0% |
Expected life [Member] | ||
Business Acquisition [Line Items] | ||
Fair value of warrants determined inputs to the Black Scholes model | 5.0 | 5.0 |
Expected Volatility [Member] | ||
Business Acquisition [Line Items] | ||
Fair value of warrants determined inputs to the Black Scholes model | 150% | 150% |
EQUITY METHOD INVESTMENT (Detai
EQUITY METHOD INVESTMENT (Details) - USD ($) | 1 Months Ended | 6 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2019 | Sep. 25, 2019 | Jun. 30, 2019 | |
Schedule of Equity Method Investments [Line Items] | ||||
Due from equity method investee | $ 184,443 | $ 184,443 | ||
Equity method investments | 35,329,167 | $ 51,717,719 | ||
Impairment charge on intangible assets | $ 15,932,016 | |||
Minimum [Member] | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Stock price declined | $ 0.73 | |||
Maximum [Member] | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Stock price declined | $ 1.67 | |||
Juneau Biosciences, LLC [Member] | Common Class A [Member] | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Shares issued during year | 15,681,818 | |||
Shares issued price per share | $ 1.10 | |||
Number of reduced units purchased | 13,000,000 |
EQUITY METHOD INVESTMENT (Summa
EQUITY METHOD INVESTMENT (Summary of Investment) (Details) - USD ($) | Dec. 31, 2019 | Jun. 30, 2019 |
Schedule of Equity Method Investments [Line Items] | ||
Carrying amount | $ 35,329,167 | $ 51,717,719 |
Juneau Biosciences, LLC [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Carrying amount | $ 35,329,167 | $ 51,717,719 |
Ownership percentage | 48.30% | 48.40% |
EQUITY METHOD INVESTMENT (Sched
EQUITY METHOD INVESTMENT (Schedule of Provision for Subscription Agreement) (Details) | 6 Months Ended |
Dec. 31, 2019USD ($) | |
Schedule of Equity Method Investments [Line Items] | |
Provision for subscription agreement | $ 9,686,610 |
2020 | |
Schedule of Equity Method Investments [Line Items] | |
Provision for subscription agreement | 1,330,000 |
2021 | |
Schedule of Equity Method Investments [Line Items] | |
Provision for subscription agreement | 1,800,000 |
2022 | |
Schedule of Equity Method Investments [Line Items] | |
Provision for subscription agreement | 5,300,000 |
2023 | |
Schedule of Equity Method Investments [Line Items] | |
Provision for subscription agreement | $ 1,256,610 |
EQUITY METHOD INVESTMENT (Sum_2
EQUITY METHOD INVESTMENT (Summary of Income Statement) (Details) - Juneau Bioscience, LLC [Member] - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Schedule of Equity Method Investments [Line Items] | ||
Revenue (related party) | $ 202,010 | $ 2,554,037 |
Gross profit | 202,010 | 2,554,037 |
Loss from operations | (1,890,382) | (2,419,890) |
Net loss | (1,889,921) | (2,419,824) |
Net loss attributable to Predictive Technology Group, Inc. | $ (912,454) | $ (1,200,238) |
ACCRUED LIABILITIES (Schedule o
ACCRUED LIABILITIES (Schedule of Accrued Liabilities) (Details) - USD ($) | Dec. 31, 2019 | Jun. 30, 2019 |
Payables and Accruals [Abstract] | ||
Employee compensation and benefits | $ 888,911 | $ 816,451 |
Other | 1,042,907 | 1,041,320 |
Total accrued liabilities | $ 1,931,818 | $ 1,857,771 |
DEBT (Details)
DEBT (Details) - USD ($) | 6 Months Ended | |
Dec. 31, 2019 | Sep. 30, 2019 | |
Debt Instrument [Line Items] | ||
Interest rate | 12.00% | |
Outstanding debt obligations | $ 6,500,000 | |
Accredited investor [Member] | Revolving Loan Agreement [Member] | ||
Debt Instrument [Line Items] | ||
Line of credit | $ 3,000,000 | |
Line of credit interest rate | 12.00% | |
Debt instrument face amount | 720,000 | |
Outstanding debt obligations | 720,000 | |
Accrued interest | 311,918 | |
Accredited investor [Member] | Unsecured promissory notes [Member] | ||
Debt Instrument [Line Items] | ||
Unsecured promissory note | $ 9,360,000 | |
Interest rate | 12.00% | |
Maturity term | 2 years | |
Debt instrument face amount | $ 8,420,000 | |
Mature during the fiscal year ended November 2021 [Member] | Promissory notes [Member] | ||
Debt Instrument [Line Items] | ||
Interest rate | 12.00% | |
Debt instrument face amount | $ 9,360,000 | |
Mature during the fiscal year ended December 2021 [Member] | Promissory notes [Member] | ||
Debt Instrument [Line Items] | ||
Interest rate | 12.00% | |
Debt instrument face amount | $ 10,080,000 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Jun. 30, 2019 | |
Income tax benefit | $ 4,239,780 | $ 713,526 | $ 9,448,195 | $ 1,325,978 | |
Minimum [Member] | |||||
Corporate tax rate | 21.00% | ||||
Maximum [Member] | |||||
Corporate tax rate | 28.00% |
STOCKHOLDER'S EQUITY (Narrative
STOCKHOLDER'S EQUITY (Narrative) (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||||
Sep. 30, 2019 | Aug. 01, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Sep. 01, 2020 | Mar. 01, 2020 | |
Class of Stock [Line Items] | ||||||||
Options granted | 2,595,800 | |||||||
Warrants expiration period | 10 years | |||||||
Share based compensation expense | $ 4,634,069 | $ 1,010,505 | $ 9,628,669 | $ 1,982,854 | ||||
FlagshipSailsRx, LLC [Member] | ||||||||
Class of Stock [Line Items] | ||||||||
Common stock warrants issued | 11,000,000 | |||||||
Shares issued | 9,172,157 | |||||||
Cancellation of warrants | 1,827,843 | |||||||
Warrants [Member] | ||||||||
Class of Stock [Line Items] | ||||||||
Options granted | 1,250,000 | |||||||
Share based compensation expense | 1,361,172 | $ 358,333 | $ 3,251,384 | $ 944,778 | ||||
Unrecognized compensation cost | $ 4,010,755 | $ 4,010,755 | ||||||
Unrecognized compensation cost, period | 1 year 4 months 9 days | |||||||
Consultant [Member] | Warrants [Member] | ||||||||
Class of Stock [Line Items] | ||||||||
Warrants expiration period | 10 years | |||||||
Consultant [Member] | Warrants [Member] | ||||||||
Class of Stock [Line Items] | ||||||||
Options granted | 1,250,000 | |||||||
Shares vested | 625,000 | 625,000 | ||||||
Consultant [Member] | Warrants [Member] | Subsequent Event [Member] | ||||||||
Class of Stock [Line Items] | ||||||||
Shares vested | 225,000 | 375,000 |
STOCKHOLDER'S EQUITY (Schedule
STOCKHOLDER'S EQUITY (Schedule of Summary of Warrant Activity) (Details) - $ / shares | 6 Months Ended | 12 Months Ended |
Dec. 31, 2019 | Jun. 30, 2018 | |
Number of Warrants | ||
Outstanding at beginning of period | 24,407,750 | |
Granted | 2,595,800 | |
Exercised | ||
Forfeited/Cancelled | (1,082,500) | |
Outstanding at end of period | 25,921,050 | |
Weighted Average Exercise Price | ||
Outstanding at beginning of period | $ 1.74 | |
Granted | 1.40 | |
Exercised | ||
Forfeited/Cancelled | 1.65 | |
Outstanding at end of period | $ 1.72 | |
Warrants [Member] | ||
Number of Warrants | ||
Outstanding at beginning of period | 68,253,520 | |
Granted | 1,250,000 | |
Exercised | (9,223,605) | |
Forfeited/Cancelled | (1,836,395) | |
Outstanding at end of period | 58,443,520 | |
Weighted Average Exercise Price | ||
Outstanding at beginning of period | $ 0.78 | |
Granted | 1.73 | |
Exercised | 0.50 | |
Forfeited/Cancelled | 0.50 | |
Outstanding at end of period | $ 0.85 | |
Weighted Average Remaining Contractual Life | ||
Granted | 9 years 8 months 12 days | |
Exercised | 2 years 8 months 12 days | |
Forfeited/Cancelled | 2 years 8 months 12 days | |
Outstanding | 3 years 3 months 19 days | 3 years 7 months 6 days |
EARNINGS PER COMMON SHARE (EP_3
EARNINGS PER COMMON SHARE (EPS) (Schedule of Weighted Shares Outstanding and Basic and Diluted Earnings Per Share) (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | |
Earnings Per Share [Abstract] | ||||
Basic and diluted EPS attributable to common shareholders, Net loss | $ (26,002,669) | $ (2,329,438) | $ (33,867,276) | $ (4,333,820) |
Basic and diluted EPS attributable to common shareholders, Weighted Average Shares Outstanding | 283,126,298 | 263,278,417 | 282,203,748 | 258,672,982 |
Basic and diluted EPS attributable to common shareholders, Per Share Amount | $ (0.09) | $ (0.01) | $ (0.12) | $ (0.02) |
EARNINGS PER COMMON SHARE (EP_4
EARNINGS PER COMMON SHARE (EPS) (Schedule of Anti Dilutive Securities) (Details) - shares | 6 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti Dilutive Securities | 84,364,570 | 71,439,770 |
Warrants for common stock [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti Dilutive Securities | 58,443,520 | 64,993,520 |
Options for common stock [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti Dilutive Securities | 25,921,050 | 6,446,250 |
STOCK OPTION PLAN (Narrative) (
STOCK OPTION PLAN (Narrative) (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Percentage of total outstanding shares | 15.00% | |||
Term of award | 10 years | |||
2015 Stock Option Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share based compensation expense | $ 3,272,897 | $ 652,172 | $ 6,377,285 | $ 1,038,076 |
Unrecognized share based compensation expense | $ 27,462,272 | $ 27,462,272 | ||
Weighted average recognition period | 2 years 5 months 5 days |
STOCK OPTION PLAN (Schedule of
STOCK OPTION PLAN (Schedule of Summary of Option Activity) (Details) | 6 Months Ended |
Dec. 31, 2019$ / sharesshares | |
Number of shares | |
Outstanding at beginning of period | shares | 24,407,750 |
Options granted | shares | 2,595,800 |
Less: Options exercised | shares | |
Less: Options canceled or expired | shares | (1,082,500) |
Outstanding at end of period | shares | 25,921,050 |
Weighted average exercise price | |
Outstanding at beginning of period | $ / shares | $ 1.74 |
Options granted | $ / shares | 1.40 |
Less: Options exercised | $ / shares | |
Less: Options canceled or expired | $ / shares | 1.65 |
Outstanding at end of period | $ / shares | $ 1.72 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES (Narrative) (Details) | Oct. 10, 2019ft² | Dec. 31, 2018USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) |
Commitments and Contingencies Disclosure [Abstract] | ||||
Purchase of consumables used by equipment | $ 1,386,710 | |||
Delivery of consumables used by equipment | $ 248,724 | |||
Rent expense under operating leases | $ 108,201 | $ 159,979 | ||
Lease maturity date | Sep. 30, 2022 | Sep. 30, 2022 | ||
Remaining payments due under the purchase commitment year June 30, 2020 | $ 693,355 | |||
Remaining payments due under the purchase commitment year June 30, 2021 | $ 346,477 | |||
Area of additional lease | ft² | 6,711 | |||
Lease commenced date | Nov. 1, 2019 |
COMMITMENTS AND CONTINGENCIES_3
COMMITMENTS AND CONTINGENCIES (Schedule of Future Minimum Lease Payments Under Operating And Capital Leases) (Details) | Dec. 31, 2019USD ($) |
Operating leases | |
2020 | $ 476,816 |
2021 | 979,071 |
2022 | 246,888 |
2023 | |
2024 | |
Total cash payments | 1,702,775 |
Less imputed interest | (128,619) |
Total | 1,574,156 |
Finance leases | |
2020 | 393,090 |
2021 | 748,361 |
2022 | 740,797 |
2023 | 167,719 |
2024 | |
Total lease payments | 2,049,967 |
Less: Imputed Interest | (214,844) |
Total | 1,835,123 |
Total Operating and finance lease | |
2020 | 869,906 |
2021 | 1,727,432 |
2022 | 987,685 |
2023 | 167,719 |
2024 | |
Total cash payments | 3,752,742 |
Less imputed interest | (343,463) |
Total | $ 3,409,279 |
COMMITMENTS AND CONTINGENCIES_4
COMMITMENTS AND CONTINGENCIES (Schedule of Lease Information) (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | |
Lease cost | |||
Amortization of right-of-use asset | $ 156,057 | $ 180,469 | |
Interest on lease liabilities | 40,488 | 44,901 | |
Operating lease cost | 223,051 | 327,455 | |
Short-term lease cost | 450 | 64,787 | |
Total lease cost | 420,046 | 617,612 | |
Operating cash flows from operating leases | 40,488 | 44,901 | |
Operating cash flows from finance leases | 224,088 | 329,517 | |
Financing cash flows from finance leases | $ 156,057 | $ 180,918 | |
Weighted average remaining lease term - Finance leases | 2 years 7 months 10 days | 2 years 7 months 10 days | |
Weighted average remaining lease term - Operating leases | 1 year 9 months | 1 year 9 months | |
Weighted average discount rate - Finance leases | 8.06% | 8.06% | |
Weighted average discount rate - Operating leases | 8.63% | 8.63% |
SUBSEQUENT EVENTS (Narrative) (
SUBSEQUENT EVENTS (Narrative) (Details) - USD ($) | 1 Months Ended | 6 Months Ended | |||
Feb. 10, 2020 | Jan. 29, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Jun. 30, 2019 | |
Subsequent Event [Line Items] | |||||
Outstanding debt obligations | $ 6,500,000 | ||||
Interest rate | 12.00% | ||||
Common stock, par value per share | $ 0.001 | $ 0.001 | |||
Proceeds from issuance of debt | $ 9,680,000 | ||||
Subsequent Event [Member] | Equity Payment [Member] | |||||
Subsequent Event [Line Items] | |||||
Common stock, par value per share | $ 0.001 | ||||
Issued common stock,value | $ 2,430,000 | ||||
Accredited investor [Member] | Subsequent Event [Member] | |||||
Subsequent Event [Line Items] | |||||
Issuance of common stock | 500,000 | ||||
Common stock, par value per share | $ 0.001 | ||||
Share price | $ 0.96 | ||||
Accredited investor [Member] | Revolving Loan Agreement [Member] | |||||
Subsequent Event [Line Items] | |||||
Debt instrument face amount | 720,000 | ||||
Outstanding debt obligations | 720,000 | ||||
Accrued interest | $ 311,918 | ||||
Common stock | 12,947,833 | ||||
Market price per share | $ 0.73 | ||||
Accredited investor [Member] | Unsecured promissory notes [Member] | |||||
Subsequent Event [Line Items] | |||||
Debt instrument face amount | $ 8,420,000 | ||||
Interest rate | 12.00% | ||||
Debt term | 2 years | ||||
Revolving Loan Agreement With An Accredited Investor [Member] | Subsequent Event [Member] | |||||
Subsequent Event [Line Items] | |||||
Interest rate | 12.00% | ||||
Proceeds from issuance of debt | $ 200,000 | ||||
Promissory Note With A Second Accredited Investor [Member] | Subsequent Event [Member] | |||||
Subsequent Event [Line Items] | |||||
Interest rate | 12.00% | ||||
Proceeds from issuance of debt | $ 450,000 |
SUBSEQUENT EVENTS (Schedule of
SUBSEQUENT EVENTS (Schedule of Payments Due Under Subscription Agreement to Purchase Units of Juneau) (Details) - Juneau Biosciences, LLC [Member] | Dec. 31, 2019USD ($) |
Subsequent Event [Line Items] | |
2020 | $ 3,030,000 |
2021 | 4,600,000 |
2022 | 2,056,610 |
Total | $ 9,686,610 |