Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Dec. 31, 2020 | Feb. 09, 2021 | |
Document and Entity Information: | ||
Entity Registrant Name | Nemaura Medical Inc. | |
Document Type | 10-Q | |
Document Period End Date | Dec. 31, 2020 | |
Amendment Flag | false | |
Entity Central Index Key | 0001602078 | |
Current Fiscal Year End Date | --03-31 | |
Entity Common Stock, Shares Outstanding | 22,930,407 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Emerging Growth Company | false | |
Entity Small Business | true | |
Entity Shell Company | false | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity File Number | 001-38355 | |
Entity Incorporation, State or Country Code | NV | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q3 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) | Dec. 31, 2020 | Mar. 31, 2020 |
Current assets: | ||
Cash | $ 14,959,785 | $ 106,107 |
Prepaid expenses and other receivables | 850,388 | 452,463 |
Inventory (raw materials) | 818,236 | 286,309 |
Total current assets | 16,628,409 | 844,879 |
Other assets: | ||
Property and equipment, net of accumulated depreciation | 200,260 | 162,064 |
Intangible assets, net of accumulated amortization | 810,319 | 213,080 |
Total other assets | 1,010,579 | 375,144 |
Total assets | 17,638,988 | 1,220,023 |
Current liabilities: | ||
Accounts Payable | 166,698 | 293,608 |
Liability due to related parties | 395,923 | 830,093 |
Other Liabilities and accrued expenses | 76,147 | 168,966 |
Notes payable, net of unamortized discount | 3,609,588 | 0 |
Deferred revenue | 102,367 | 93,022 |
Total current liabilities | 4,350,723 | 1,385,689 |
Non-current portion of notes payable, net of unamortized discount | 1,698,727 | 0 |
Non-current portion of deferred revenue | 1,262,533 | 1,147,278 |
Total non-current liabilities | 2,961,260 | 1,147,278 |
Total liabilities | 7,311,983 | 2,532,967 |
Commitments and contingencies | ||
Stockholders' equity / (deficit): | ||
Series A convertible preferred stock, $0.001 par value, 200,000 shares authorized; 0 shares issued and outstanding at December 31, 2020 and March 31, 2020, respectively | 0 | 0 |
Common stock, $0.001 par value, 42,000,000 shares authorized and 22,930,407 and 20,850,848 shares issued and outstanding at December 31, 2020 and March 31, 2020, respectively | 22,931 | 20,851 |
Additional paid in capital | 31,998,346 | 16,589,272 |
Accumulated deficit | (21,714,045) | (17,586,075) |
Accumulated other comprehensive loss | 19,773 | (336,992) |
Total stockholders' equity/ (deficit) | 10,327,005 | (1,312,944) |
Total liabilities and stockholders' equity | $ 17,638,988 | $ 1,220,023 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Dec. 31, 2020 | Mar. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, authorized | 200,000 | 200,000 |
Preferred stock, issued | 0 | 0 |
Preferred stock, outstanding | 0 | 0 |
Common stock, par value per share | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 42,000,000 | 42,000,000 |
Common stock, shares issued | 22,930,407 | 20,850,848 |
Common stock, shares outstanding | 22,930,407 | 20,850,848 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Comprehensive Loss (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | |
Income Statement [Abstract] | ||||
Revenue | $ 0 | $ 0 | $ 0 | $ 0 |
Total revenues | 0 | 0 | 0 | 0 |
Operating expenses: | ||||
Research and development | 486,957 | 516,672 | 1,258,549 | 1,535,370 |
General and administrative | 581,520 | 542,697 | 1,948,773 | 1,896,230 |
Total operating expenses | 1,068,477 | 1,059,369 | 3,207,322 | 3,431,600 |
Loss from operations | (1,068,477) | (1,059,369) | (3,207,322) | (3,431,600) |
Interest (expense) / income | (378,220) | 0 | (920,648) | 3,926 |
Loss before income tax benefit | (1,446,697) | (1,059,369) | (4,127,970) | (3,427,674) |
Provision for income tax benefit | 0 | 614,362 | 0 | 614,362 |
Net Loss | (1,446,697) | (445,007) | (4,127,970) | (2,813,312) |
Other comprehensive income / (loss): | ||||
Foreign currency translation adjustment | 371,275 | (25,834) | 356,765 | (48,986) |
Comprehensive loss | $ (1,075,422) | $ (470,841) | $ (3,771,205) | $ (2,862,298) |
Loss per share: | ||||
Basic and diluted | $ (0.06) | $ (0.02) | $ (0.19) | $ (0.14) |
Weighted average number of shares outstanding | 22,922,387 | 20,808,050 | 22,068,290 | 20,798,013 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Changes in Stockholders' Equity (Unaudited) - USD ($) | Common Stock [Member] | Additional Paid-In Capital | Accumulated Deficit | Accumulated Other Comprehensive Loss | Total |
Beginning Balance, Shares at Mar. 31, 2019 | 20,765,592 | ||||
Beginning Balance, Amount at Mar. 31, 2019 | $ 20,766 | $ 15,971,905 | $ (13,425,879) | $ (339,888) | $ 2,226,904 |
Issuance of common shares, net of offering costs, Shares | 14,338 | ||||
Issuance of common shares, net of offering costs, Amount | $ 14 | 142,903 | 142,917 | ||
Restricted shares issued as stock- based compensation to consultants and investor relations, Shares | 25,500 | ||||
Restricted shares issued as stock- based compensation to consultants and investor relations, Amount | $ 25 | 231,924 | 231,949 | ||
Exercise of warrants, Shares | 2,500 | ||||
Exercise of warrants, Amount | $ 3 | 25,997 | 26,000 | ||
Reverse split adjustment, Shares | 418 | ||||
Reverse split adjustment, Amount | |||||
Foreign currency translation adjustment | (48,986) | (48,986) | |||
Net loss | (2,813,312) | (2,813,312) | |||
Ending Balance, Shares at Dec. 31, 2019 | 20,808,348 | ||||
Ending Balance, Amount at Dec. 31, 2019 | $ 20,808 | 16,372,729 | (16,239,191) | (388,874) | (234,528) |
Beginning Balance, Shares at Sep. 30, 2019 | 20,802,930 | ||||
Beginning Balance, Amount at Sep. 30, 2019 | $ 20,803 | 16,332,734 | (15,794,184) | (363,040) | 196,313 |
Restricted shares issued as stock- based compensation to consultants and investor relations, Shares | 5,000 | ||||
Restricted shares issued as stock- based compensation to consultants and investor relations, Amount | $ 5 | 39,995 | 40,000 | ||
Reverse split adjustment, Shares | 418 | ||||
Reverse split adjustment, Amount | |||||
Foreign currency translation adjustment | (25,834) | (25,834) | |||
Net loss | (445,007) | (445,007) | |||
Ending Balance, Shares at Dec. 31, 2019 | 20,808,348 | ||||
Ending Balance, Amount at Dec. 31, 2019 | $ 20,808 | 16,372,729 | (16,239,191) | (388,874) | (234,528) |
Beginning Balance, Shares at Mar. 31, 2020 | 20,850,848 | ||||
Beginning Balance, Amount at Mar. 31, 2020 | $ 20,851 | 16,589,272 | (17,586,075) | (336,992) | (1,312,944) |
Issuance of common shares, net of offering costs, Shares | 1,994,924 | ||||
Issuance of common shares, net of offering costs, Amount | $ 1,995 | 14,791,484 | 14,793,479 | ||
Restricted shares issued as stock- based compensation to consultants and investor relations, Shares | 46,702 | ||||
Restricted shares issued as stock- based compensation to consultants and investor relations, Amount | $ 47 | 223,153 | 223,200 | ||
Exercise of warrants, Shares | 37,933 | ||||
Exercise of warrants, Amount | $ 38 | 394,437 | 394,475 | ||
Foreign currency translation adjustment | 356,765 | 356,765 | |||
Net loss | (4,127,970) | (4,127,970) | |||
Ending Balance, Shares at Dec. 31, 2020 | 22,930,407 | ||||
Ending Balance, Amount at Dec. 31, 2020 | $ 22,931 | 31,998,346 | (21,714,045) | 19,773 | 10,327,005 |
Beginning Balance, Shares at Sep. 30, 2020 | 22,893,705 | ||||
Beginning Balance, Amount at Sep. 30, 2020 | $ 22,894 | 31,838,383 | (20,267,348) | (351,502) | 11,242,427 |
Restricted shares issued as stock- based compensation to consultants and investor relations, Shares | 36,702 | ||||
Restricted shares issued as stock- based compensation to consultants and investor relations, Amount | $ 37 | 159,963 | 160,000 | ||
Foreign currency translation adjustment | 371,275 | 371,275 | |||
Net loss | (1,446,697) | (1,446,697) | |||
Ending Balance, Shares at Dec. 31, 2020 | 22,930,407 | ||||
Ending Balance, Amount at Dec. 31, 2020 | $ 22,931 | $ 31,998,346 | $ (21,714,045) | $ 19,773 | $ 10,327,005 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 9 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Cash Flows From Operating Activities: | ||
Net loss | $ (4,127,970) | $ (2,813,312) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and Amortization | 68,310 | 47,550 |
Accretion of debt discount | 920,648 | 0 |
Stock Based Compensation | 84,000 | 317,664 |
Changes in assets and liabilities: | ||
Prepaid expenses and other receivables | (397,926) | 206,716 |
Inventory | (531,927) | (186,137) |
Accounts payable | (126,910) | 21,259 |
Liability due to related party | (434,170) | (268,483) |
Other liabilities and accrued expenses | (92,819) | 110,780 |
Net cash used in operating activities | (4,638,764) | (2,563,963) |
Cash Flows from Investing Activities: | ||
Capitalized patent costs | (48,273) | (50,570) |
Software development costs in process | (446,455) | 0 |
Purchase of property and equipment | (70,547) | (162,615) |
Net cash (used in) provided by investing activities | (565,275) | (213,185) |
Cash Flows from Financing Activities: | ||
Costs incurred in relation to equity financing | (957,193) | (9,575) |
Commission paid on note payable | (325,000) | 0 |
Proceeds from issuance of notes | 5,000,000 | 0 |
Proceeds from issuance of common stock in relation to equity financing | 15,750,672 | 152,492 |
Proceeds from warrant exercise | 394,475 | 26,000 |
Repayments of note payable | (300,000) | 0 |
Repayment of insurance financing | (82,555) | (28,207) |
Net cash provided by financing activities | 19,480,399 | 140,710 |
Net increase / (decrease) in cash | 14,276,360 | (2,636,438) |
Effect of exchange rate changes on cash | 577,318 | (36,563) |
Cash at beginning of period | 106,107 | 3,740,664 |
Cash at end of period | 14,959,785 | 1,067,663 |
Supplemental disclosure of non-cash financing activities: | ||
Gross amount of insurance funded through note payable | 0 | 132,352 |
Licenses acquired through issuance of restricted common stock | $ 100,000 | $ 0 |
ORGANIZATION AND PRINCIPAL ACTI
ORGANIZATION AND PRINCIPAL ACTIVITIES | 9 Months Ended |
Dec. 31, 2020 | |
Disclosure Text Block [Abstract] | |
Organization and principal activities | NOTE 1 – ORGANIZATION AND PRINCIPAL ACTIVITIES Nemaura Medical Inc. (“Nemaura” or the “Company”), through its operating subsidiaries, performs medical device research and manufacturing of a continuous glucose monitoring system (“CGM”), named sugarBEAT ® ® ® Nemaura is a Nevada holding company organized in 2013. Nemaura owns 100% of Region Green Limited, a British Virgin Islands corporation (“RGL”) formed on December 12, 2013. RGL owns 100% of the stock in Dermal Diagnostic (Holdings) Limited, an England and Wales corporation (“DDHL”) formed on December 11, 2013, which in turn owns 100% of Dermal Diagnostics Limited, an England and Wales corporation formed on January 20, 2009 (“DDL”), and 100% of Trial Clinic Limited, an England and Wales corporation formed on January 12, 2011 (“TCL”). DDL is a diagnostic medical device company headquartered in Loughborough, Leicestershire, England, and is engaged in the discovery, development and commercialization of diagnostic medical devices. The Company’s initial focus has been on the development of the sugarBEAT ® The following diagram illustrates Nemaura’s corporate structure as of December 31, 2020: The Company was incorporated in 2013 and has reported recurring losses from operations to date and an accumulated deficit of $21,714,045 as of December 31, 2020. These operations have resulted in the successful completion of clinical programs to support approval of a CE mark (European Union approval of the product) which is managed via an ISO 13485 accredited Quality Management System that is subject to annual audit by the accreditation body (“BSI”); this accreditation was successfully renewed during November 2020. In addition to this, a medical device Premarket Approval (“PMA”) application was submitted to the U.S. Food and Drug Administration (“FDA”) in July 2020; however, we, along with other applicants, have been informed by the FDA that the approval process is currently subject to delays as a result of the FDA’s Center for Devices and Radiological Health (“CDRH”) being actively engaged in responding to the current pandemic caused by COVID-19. According to recent notifications received from the FDA, this has resulted in staff being reallocated to other approval requests associated with COVID-19. As such, the timeline for other, non-COVID-19 related, approvals continues to be adversely impacted. Current guidance provided by the FDA indicates that this staff reallocation is likely to last at least through mid-April, 2021. The Company expects to continue to incur losses from operations until revenues are generated through licensing fees or product sales. However, given the completion of the requisite clinical programs, these losses are expected to be reduced over time. Management has entered into licensing agreements with unrelated third parties relating to the United Kingdom, Europe, Qatar and all countries in the Gulf Cooperation Council. Management has evaluated the expected expenses to be incurred along with its available cash and has determined that the Company has the ability to continue as a going concern for at least one year after the date of issuance of these unaudited condensed consolidated financial statements. On April 15, 2020, the Company entered into a note purchase agreement resulting in net cash proceeds of $4,675,000, as further described in Note 6 ® |
BASIS OF PRESENTATION
BASIS OF PRESENTATION | 9 Months Ended |
Dec. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | NOTE 2 – BASIS OF PRESENTATION (a) Basis of presentation The accompanying unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”), and do not include all of the information and footnotes required by U.S. generally accepted accounting principles (“U.S. GAAP”) for complete financial statements. However, such information reflects all adjustments consisting of normal recurring accruals which are, in the opinion of management, necessary for a fair statement of the financial condition and results of operations for the interim periods. The results for the three months and nine months ended December 31, 2020 are not indicative of annual results. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. GAAP for interim financial information and with the instructions to Form 10-Q and Article 8 of Regulation S-X. It is suggested that these unaudited condensed consolidated financial statements be read in conjunction with the consolidated financial statements and the notes thereto included in the Company’s Annual Report on Form 10-K for the year ended March 31, 2020, as filed with the SEC. The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and the Company’s subsidiaries. References to “we”, “us”, “our”, or the “Company” refer to Nemaura Medical Inc. and its consolidated subsidiaries. The unaudited condensed consolidated financial statements are prepared in accordance with U.S. GAAP, and all significant intercompany balances and transactions have been eliminated in consolidation. The functional currency for the majority of the Company’s operations is the Great Britain Pound Sterling (“GBP”), and the reporting currency is the U.S. Dollar (“USD”). (b) Changes to significant accounting policies The Company adopted the Financial Accounting Standards Board’s Accounting Standards Update ("ASU") No. 2016-02, Leases, as of April 1, 2020 and the impact of adoption of this ASU on the Company’s consolidated financial statements is not significant. There have been no other material changes to our significant accounting policies from those detailed in the Company’s Annual Report on Form 10-K for the year ended March 31, 2020, as filed with the SEC. (c) Recently adopted accounting pronouncements The Company continually assesses any new accounting pronouncements to determine their applicability. When it is determined that a new accounting pronouncement affects the Company's financial reporting, the Company undertakes a study to determine the consequences of the change to its consolidated financial statements and assures that there are proper controls in place to ascertain that the Company's consolidated financial statements properly reflect the change. This Quarterly Report on Form 10-Q does not discuss recent pronouncements that are not anticipated to have a current and/or future impact on the Company, or are unrelated to the Company’s financial condition, results of operations, cash flows or disclosures. |
LICENSING AGREEMENT
LICENSING AGREEMENT | 9 Months Ended |
Dec. 31, 2020 | |
Advance Royalties [Abstract] | |
Licensing Agreement | NOTE 3 – LICENSING AGREEMENTS United Kingdom and the Republic of Ireland, the Channel Islands and the Isle of Man In March 2014, the Company entered into an Exclusive Marketing Rights Agreement (the “Marketing Rights Agreement”) with an unrelated third party (the “Licensee”), that granted to the Licensee the exclusive right to market and promote the sugarBEAT ® The Company is in ongoing dialogue with the Licensee about the timing of its plans with respect to its product launch. The current expectation is for this to occur in the quarter ending June 30, 2021. The upfront fees received from the Marketing Rights Agreement have been deferred and will be recorded as income over the term of the Marketing Rights Agreement. Consequently, approximately $102,000 and $93,000 of the deferred revenue has been classified as a current liability as of December 31, 2020 and March 31, 2020, respectively. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 9 Months Ended |
Dec. 31, 2020 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | NOTE 4 – RELATED PARTY TRANSACTIONS Nemaura Pharma Limited (“Pharma”), NDM Technologies Limited (“NDM”) and Black and White Health Care Limited (“B&W”) are entities controlled by the Company’s Chief Executive Officer, President, director and majority stockholder, Dewan F.H. Chowdhury. These unaudited condensed consolidated financial statements are intended to reflect all costs associated with the operations of DDL and TCL. Pharma has a service agreement with DDL to undertake development, manufacture and regulatory approvals under Pharma’s ISO13485 accreditation. In lieu of these services, Pharma invoices DDL on a periodic basis for said services. Services are provided at cost plus a service surcharge amounting to less than 10% of the total costs incurred. The table below provides a summary of activity between the Company and Pharma and NDM for the nine months ended December 31, 2020 and 2019, and the year ended March 31, 2020. These amounts are unsecured, interest free, and payable on demand. Nine Months Ended December 31, 2020 (unaudited) ($) Nine Months Ended December 31, 2019 (unaudited) ($) Year Ended March 31, 2020 ($) Liability due to related parties at beginning of period 830,093 964,679 964,679 Amounts invoiced by Pharma to DDL, NDM and TCL (1) 1,859,548 1,369,272 1,800,517 Amounts invoiced by DDL to Pharma (17,213 ) (5,874 ) (10,963 ) Amounts paid by DDL to Pharma (2,338,701 ) (1,642,019 ) (1,897,222 ) Foreign exchange differences 62,196 15,970 (26,918 ) Liability due to related parties at end of period 395,923 702,028 830,093 (1) These amounts are primarily incurred as a result of research and development expenses charged to the Company by Pharma. The Company routinely reviews its condensed consolidated statements of cash flows presentation of related party transactions for financing or operating classification based on the underlying nature of the item and intended repayment. |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 9 Months Ended |
Dec. 31, 2020 | |
Equity [Abstract] | |
Stockholders' Equity | NOTE 5 – STOCKHOLDERS’ EQUITY Reverse stock split The Company was notified by The NASDAQ Stock Market (“NASDAQ”) on July 15, 2019 that the Company no longer met the requirements of NASDAQ Rule 5550(a)(2) requiring listed securities to maintain a minimum closing bid price of $1.00 per share. Thereafter, the Company effected: (i) A reverse split of the Company’s issued and outstanding common stock on a one (1) for ten (10) basis; and (ii) A decrease in the Company’s authorized number of shares of common stock on the same basis from 420,000,000 shares of common stock to 42,000,000 shares of common stock. The reverse stock split and decrease in authorized common stock were effective on December 5, 2019. On December 19, 2019, the Company received confirmation from NASDAQ that the Company had regained compliance with NASDAQ’s minimum bid price rule and the matter is now resolved. Amounts are retroactively restated for all periods presented. Other equity transactions On October 19, 2018, the Company entered into an Equity Distribution Agreement (the “Distribution Agreement”) with Maxim Group LLC, as sales agent (“Maxim”), pursuant to which the Company may offer and sell, from time to time, through Maxim, up to $20,000,000 in shares of its common stock. On August 8, 2020, pursuant to the terms of the Distribution Agreement, as amended, between the Company and Maxim, the Company provided notice of termination of the Distribution Agreement, as amended, to Maxim. Accordingly, the Distribution Agreement, as amended, terminated on August 18, 2020. During the nine month period ended December 31, 2020, for which the Distribution Agreement was active, a total of 408,718 shares were issued, generating gross proceeds of $4,250,676 with associated costs of $127,520. On July 28, 2020, the Company entered into a placement agency agreement with Kingswood Capital Markets, a division of Benchmark Investments, Inc., with respect to the issuance and sale of an aggregate of 1,586,206 shares of the Company’s common stock, and warrants to purchase up to 793,103 shares of common stock. Each share of common stock and accompanying one-half of a warrant were sold for a combined purchase price of $7.25, for a total deal size of approximately $11.5 million, not including any future proceeds from the exercise of the warrants and before deducting the Placement Agent fees and offering expenses. Each whole warrant is immediately exercisable at a price of $8.00 per share, subject to adjustment in certain circumstances, and will expire five years from the date of issuance. The shares of common stock were offered together with the warrants, but the securities were issued separately and are separately transferable. The closing of the offering took place on July 30, 2020 and the net proceeds from the sale of the common stock and warrants were approximately $10.7 million after deducting the Placement Agent commission and other expenses incurred by the Company as a result of the offering. During the nine month period ended December 31, 2020, 37,933 warrants were exercised, generating $394,475 in additional funds; no warrants were exercised in the three month period ended December 31, 2020. During the nine month period ended December 31, 2019, 2,500 warrants were exercised generating funds of $26,000, all of which were exercised during the three month period ended June 30, 2019. At December 31, 2020, there were 940,740 warrants outstanding. Effective December 18, 2018, the Company issued a unit purchase option to Dawson James Securities, Inc., the then placement agent, to purchase 9,710 shares of common stock and 9,710 warrants. The Company has classified this option as equity. The unit purchase option has a term of three years and an exercise price of $13.00. Loss per share The following table sets forth the computation of basic and diluted loss per share for the periods indicated. Three months ended December 31, Nine months ended December 31, 2020 2019 2020 2019 Net loss attributable to common stockholders ($) (1,446,697 ) (445,007 ) (4,127,970 ) (2,813,312 ) Weighted average basic and diluted shares outstanding 22,922,387 20,808,050 22,068,290 20,798,013 Basic and diluted loss per share ($): (0.06 ) (0.02 ) (0.19 ) (0.14 ) Because the Company is in a loss position, the Company excludes warrants outstanding, which are anti-dilutive, from the basic and diluted loss per share calculation. Basic loss per share is computed by dividing loss available to common stockholders by the weighted average number of common shares outstanding during the period. For the three and nine month periods ended December 31, 2020 and 2019, warrants to purchase one million shares of common stock were anti-dilutive and were excluded from the calculation of diluted loss per share. Additionally, for the three and nine month periods ended December 31, 2020, there were a further 940,740 shares of common stock, respectively, and a unit purchase option to purchase 9,710 shares of common stock that were considered anti-dilutive and also excluded from the calculation of diluted loss per share. For the three and nine month periods ended December 31, 2019, the equivalent number of warrants excluded from this calculation was 185,570 and the unit purchase option was 9,710. |
NOTES PAYABLE
NOTES PAYABLE | 9 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
Notes Payable | NOTE 6 – NOTES PAYABLE On April 15, 2020, the Company entered into a note purchase agreement (the “Note Purchase Agreement”) with an unrelated third party (the “Investor”). Pursuant to the terms of the Note Purchase Agreement, the Company agreed to issue and sell to the Investor and the Investor agreed to purchase from the Company, a secured promissory note (the “Secured Note”) in the original principal amount of $6,015,000. In consideration thereof, on April 15, 2020 (the closing date), (i) the Investor (a) paid $1,000,000 in cash, (b) issued to the Company (1) Investor Note #1 in the principal amount of $2,000,000 (“Investor Note #1”), and (2) Investor Note #2 in the principal amount of $2,000,000 (“Investor Note #2” together with Investor Note #1, the “Investor Notes”), and (ii) the Company delivered the Secured Note on behalf of the Company, to the Investor, against delivery of the Purchase Price. For these purposes, the “Purchase Price” means the Investor’s initial cash purchase price, together with the sum of the initial principal amounts of the Investor Notes. The Secured Note is secured by all patents and related rights and items as defined in the related security agreement within the Secured Note. The Secured Note carries an original issue discount (“OID”) of $1,000,000. In addition, the Company agreed to pay $15,000 to the Investor to cover the Investor’s legal fees, accounting costs, due diligence, monitoring and other transaction costs incurred in connection with the purchase and sale of the Secured Note (the “Transaction Expense Amount”), all of which amount is included in the initial principal balance of the Secured Note. The Purchase Price for the Secured Note is $5,000,000, computed as follows: $6,015,000 original principal balance, less the OID, less the commission expense of $325,000, resulting in cash proceeds of $4,675,000. The debt less the discount will be accreted over the 24-month term of the Secured Note using the effective interest method. The effective interest rate is 34.3%. A monitoring fee equal to 0.833% of the outstanding balance will automatically be added to the outstanding balance on the first day of each month. Accretion for the three and nine month periods ended December 31, 2020 was $378,220 and $920,648, respectively. |
OTHER ITEMS
OTHER ITEMS | 9 Months Ended |
Dec. 31, 2020 | |
Other Income and Expenses [Abstract] | |
Other items | NOTE 7 – OTHER ITEMS (a) COVID-19 Pandemic The outbreak of COVID-19 originating in Wuhan, China, in December 2019 has since rapidly increased its exposure globally. On March 11, 2020, the World Health Organization declared the outbreak a pandemic. We continue to monitor the global outbreak of COVID-19 and are working with our employees, suppliers and other stakeholders to mitigate the risks posed by its spread, COVID-19 is not expected to have any long-term detrimental effect on the Company’s success. While key suppliers have not been accessible throughout the whole period of the outbreak, we have been able to be flexible in our priorities and respond favorably to the challenges faced during the outbreak. We have also seen a surge in the uptake of technologies for remote and patient self-monitoring, which therefore potentially enhances the prospects for the likes of the Company and its CGM product and planned digital healthcare offering. (b) Management consultancy agreements During the nine month period ended December 31, 2020, $59,000 in stock-based compensation was shown as expense in relation to a management consulting company. No stock-based compensation was provided during the three month period ended December 31, 2020 for these services. Total stock-based compensation recognized during the three and nine month periods ended December 31, 2019 was $40,000 and $317,664, respectively. (c) Investor relations agreements During the three and nine month periods ended December 31, 2020, Nemaura entered into an agreement with a third party provider of investor relations services for which $25,000 in stock-based compensation was shown as expense in relation to the services received. The contract for services is for a 12 month period, with a similar expense expected to be incurred through stock-based compensation in each quarter of this term. No stock-based compensation expense was incurred for any similar services for the three or nine month periods ended December 31, 2019. (d) Subsequent events On February 8, 2021, the Company entered into an additional note purchase agreement (“Note Purchase Agreement 2”) with an affiliate of the unrelated third party who holds the existing Note Purchase Agreement that was issued dated April 15, 2020 (the “Investor”), see Note 6 Secured Note 2 is secured against all of the Company’s assets owned as of the closing date and extends to any assets acquired at any time that the Company’s obligations under Secured Note 2 are outstanding. The Company has taken on this additional, non-dilutive funding, to enable the acceleration of future revenue growth. |
BASIS OF PRESENTATION (Policies
BASIS OF PRESENTATION (Policies) | 9 Months Ended |
Dec. 31, 2020 | |
Disclosure Text Block [Abstract] | |
Basis of presentation | (a) Basis of presentation The accompanying unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”), and do not include all of the information and footnotes required by U.S. generally accepted accounting principles (“U.S. GAAP”) for complete financial statements. However, such information reflects all adjustments consisting of normal recurring accruals which are, in the opinion of management, necessary for a fair statement of the financial condition and results of operations for the interim periods. The results for the three months and nine months ended December 31, 2020 are not indicative of annual results. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. GAAP for interim financial information and with the instructions to Form 10-Q and Article 8 of Regulation S-X. It is suggested that these unaudited condensed consolidated financial statements be read in conjunction with the consolidated financial statements and the notes thereto included in the Company’s Annual Report on Form 10-K for the year ended March 31, 2020, as filed with the SEC. The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and the Company’s subsidiaries. References to “we”, “us”, “our”, or the “Company” refer to Nemaura Medical Inc. and its consolidated subsidiaries. The unaudited condensed consolidated financial statements are prepared in accordance with U.S. GAAP, and all significant intercompany balances and transactions have been eliminated in consolidation. The functional currency for the majority of the Company’s operations is the Great Britain Pound Sterling (“GBP”), and the reporting currency is the U.S. Dollar (“USD”). |
Changes to significant accounting policies | (b) Changes to significant accounting policies The Company adopted the Financial Accounting Standards Board’s Accounting Standards Update ("ASU") No. 2016-02, Leases, as of April 1, 2020 and the impact of adoption of this ASU on the Company’s consolidated financial statements is not significant. There have been no other material changes to our significant accounting policies from those detailed in the Company’s Annual Report on Form 10-K for the year ended March 31, 2020, as filed with the SEC. |
Recently adopted accounting pronouncements | (c) Recently adopted accounting pronouncements The Company continually assesses any new accounting pronouncements to determine their applicability. When it is determined that a new accounting pronouncement affects the Company's financial reporting, the Company undertakes a study to determine the consequences of the change to its consolidated financial statements and assures that there are proper controls in place to ascertain that the Company's consolidated financial statements properly reflect the change. This Quarterly Report on Form 10-Q does not discuss recent pronouncements that are not anticipated to have a current and/or future impact on the Company, or are unrelated to the Company’s financial condition, results of operations, cash flows or disclosures. |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 9 Months Ended |
Dec. 31, 2020 | |
Table Text Block Supplement [Abstract] | |
Schedule of Related Party Transactions | The table below provides a summary of activity between the Company and Pharma and NDM for the nine months ended December 31, 2020 and 2019, and the year ended March 31, 2020. These amounts are unsecured, interest free, and payable on demand. Nine Months Ended December 31, 2020 (unaudited) ($) Nine Months Ended December 31, 2019 (unaudited) ($) Year Ended March 31, 2020 ($) Liability due to related parties at beginning of period 830,093 964,679 964,679 Amounts invoiced by Pharma to DDL, NDM and TCL (1) 1,859,548 1,369,272 1,800,517 Amounts invoiced by DDL to Pharma (17,213 ) (5,874 ) (10,963 ) Amounts paid by DDL to Pharma (2,338,701 ) (1,642,019 ) (1,897,222 ) Foreign exchange differences 62,196 15,970 (26,918 ) Liability due to related parties at end of period 395,923 702,028 830,093 (1) These amounts are primarily incurred as a result of research and development expenses charged to the Company by Pharma. |
STOCKHOLDERS' EQUITY (Tables)
STOCKHOLDERS' EQUITY (Tables) | 9 Months Ended |
Dec. 31, 2020 | |
Equity [Abstract] | |
Schedule of earnings (loss) per share | The following table sets forth the computation of basic and diluted loss per share for the periods indicated. Three months ended December 31, Nine months ended December 31, 2020 2019 2020 2019 Net loss attributable to common stockholders ($) (1,446,697 ) (445,007 ) (4,127,970 ) (2,813,312 ) Weighted average basic and diluted shares outstanding 22,922,387 20,808,050 22,068,290 20,798,013 Basic and diluted loss per share ($): (0.06 ) (0.02 ) (0.19 ) (0.14 ) |
ORGANIZATION AND PRINCIPAL AC_2
ORGANIZATION AND PRINCIPAL ACTIVITIES (Details Narrative) - USD ($) | 1 Months Ended | 9 Months Ended | |||
Apr. 15, 2020 | Dec. 31, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Mar. 31, 2019 | |
Disclosure Text Block [Abstract] | |||||
Accumulated deficit | $ (21,714,045) | $ (17,586,075) | |||
Proceeds from notes payable | $ 4,675,000 | 4,675,000 | |||
Cash | $ 14,959,785 | $ 106,107 | $ 1,067,663 | $ 3,740,664 |
LICENSING AGREEMENT (Details Na
LICENSING AGREEMENT (Details Narrative) - USD ($) | Dec. 31, 2020 | Mar. 31, 2020 |
Advance Royalties [Abstract] | ||
Non-refundable, upfront cash payment | $ 1,365,000 | $ 1,240,000 |
Deferred revenue | $ 102,000 | $ 93,000 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) | 9 Months Ended | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Mar. 31, 2020 | ||
Related Party Transactions [Abstract] | ||||
Liability due to related party, beginning of period | $ 830,093 | $ 964,679 | $ 964,679 | |
Amount invoiced by Pharma to DDL, NDM and TCL | [1] | 1,859,548 | 1,369,272 | 1,800,517 |
Amounts invoiced by DDL to Pharma | (17,213) | (5,874) | (10,963) | |
Amounts paid by DDL to Pharma | (2,338,701) | (1,642,019) | (1,897,222) | |
Foreign exchange differences | 62,196 | 15,970 | (26,918) | |
Liability due to related party, end of the period | $ 395,923 | $ 702,028 | $ 830,093 | |
[1] | These amounts are primarily incurred as a result of research and development expenses charged to the Company by Pharma. |
STOCKHOLDERS' EQUITY (Details)
STOCKHOLDERS' EQUITY (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | |
Equity [Abstract] | ||||
Net loss attributable to common stockholders | $ (1,446,697) | $ (445,007) | $ (4,127,970) | $ (2,813,312) |
Weighted average basic and diluted shares outstanding | 22,922,387 | 20,808,050 | 22,068,290 | 20,798,013 |
Basic and diluted loss per share | $ (0.06) | $ (0.02) | $ (0.19) | $ (0.14) |
STOCKHOLDERS' EQUITY (Details N
STOCKHOLDERS' EQUITY (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||||
Jul. 30, 2020 | Jul. 28, 2020 | Dec. 18, 2018 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | |
Reverse stock split | One (1) for ten (10) basis | ||||||
Proceeds from warrants | $ 394,475 | $ 2,500 | |||||
Warrants exercised | 0 | 37,933 | 26,000 | ||||
Warrant Outstanding | $ 940,740 | $ 940,740 | |||||
Warrants [Member] | |||||||
Anti-dilutive common stock | 1,000,000 | 185,570 | 1,000,000 | 185,570 | |||
Common Stock [Member] | |||||||
Anti-dilutive common stock | 940,740 | 940,740 | |||||
Option [Member] | |||||||
Anti-dilutive common stock | 9,710 | 9,710 | 9,710 | 9,710 | |||
Dawson James Securities, Inc. [Member] | |||||||
Options, exercise price | $ 13 | ||||||
Dawson James Securities, Inc. [Member] | Warrant [Member] | |||||||
Options issued to purchase units | 9,710 | ||||||
Dawson James Securities, Inc. [Member] | Common Stock [Member] | |||||||
Options issued to purchase units | 9,710 | ||||||
Placement agent [Member] | |||||||
Proceeds from sale of common stock and warrants | $ 10,700,000 | ||||||
Distribution Agreement [Member] | |||||||
Number of common stock sold | 408,718 | ||||||
Proceeds from common stock sold | $ 4,250,676 | ||||||
Related cost | $ 127,520 | ||||||
Placement agency agreement [Member] | Kingswood [Member] | |||||||
Number of common stock sold | 1,586,206 | ||||||
Proceeds from common stock sold | $ 11,500,000 | ||||||
Warrants exercisable | $ 8 | ||||||
Number of warrants purchased | 793,103 |
NOTES PAYABLE (Details Narrativ
NOTES PAYABLE (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | |
Apr. 15, 2020 | Dec. 31, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
Proceeds from note payable | $ 4,675,000 | $ 4,675,000 | ||
Accretion | $ 378,220 | $ 920,648 | $ 0 | |
Note Purchase Agreement [Member] | Investor [Member] | Secured Note [Member] | ||||
Principal amount | 6,015,000 | |||
Amount paid in cash | 1,000,000 | |||
Original issue discount | 1,000,000 | |||
Legal fees | 15,000 | |||
Purchase Price | 5,000,000 | |||
Commission expense | 325,000 | |||
Proceeds from note payable | $ 4,675,000 | |||
Term | 24 months | |||
Interest rate | 34.30% | |||
Monitoring fee, percentage | 0.833% | |||
Note Purchase Agreement [Member] | Investor [Member] | Investor Note #1 [Member] | ||||
Principal amount | $ 2,000,000 | |||
Note Purchase Agreement [Member] | Investor [Member] | Investor Note #2 [Member] | ||||
Principal amount | $ 2,000,000 |
OTHER ITEMS (Details Narrative)
OTHER ITEMS (Details Narrative) - USD ($) | Feb. 08, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 |
Stock compensation expense | $ 40,000 | $ 84,000 | $ 317,664 | ||
Management Consultancy Agreement [Member] | |||||
Stock compensation expense | $ 0 | 59,000 | $ 277,644 | ||
Investor Relations Agreements [Member] | |||||
Stock compensation expense | $ 25,000 | $ 25,000 | |||
Note Purchase Agreement 2 [Member] | Subsequent Event [Member] | |||||
Principal amount | $ 24,015,000 | ||||
Proceeds from related party debt | 20,000,000 | ||||
Commission expense | 1,200,000 | ||||
Proceeds from related party debt net | $ 18,800,000 |