Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Mar. 31, 2021 | Jun. 29, 2021 | Sep. 30, 2020 | |
Document and Entity Information: | |||
Entity Registrant Name | Nemaura Medical Inc. | ||
Document Type | 10-K | ||
Document Period End Date | Mar. 31, 2021 | ||
Amendment Flag | false | ||
Entity Central Index Key | 0001602078 | ||
Current Fiscal Year End Date | --03-31 | ||
Entity Common Stock, Shares Outstanding | 23,308,049 | ||
Entity Public Float | $ 39,100,000 | ||
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 Voluntary Filers | No | ||
Entity Well-known Seasoned Issuer | No | ||
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 | FY | ||
ICFR Auditor Attestation Flag | false |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Mar. 31, 2021 | Mar. 31, 2020 |
Current assets: | ||
Cash | $ 31,865,371 | $ 106,107 |
Prepaid expenses | 1,269,513 | 452,463 |
Inventory | 850,622 | 286,309 |
Total current assets | 33,985,506 | 844,879 |
Other assets: | ||
Property and equipment, net of accumulated depreciation | 202,145 | 162,064 |
Intangible assets, net of accumulated amortization | 1,055,256 | 213,080 |
Total Other Assets | 1,257,401 | 375,144 |
Total assets | 35,242,907 | 1,220,023 |
Current liabilities | ||
Accounts Payable | 253,694 | 293,608 |
Liabilities due to related parties | 148,795 | 830,093 |
Other Liabilities and accrued expenses | 180,552 | 168,966 |
Notes payable, current portion | 5,733,370 | 0 |
Deferred revenue | 103,470 | 93,022 |
Total current liabilities | 6,419,881 | 1,385,689 |
Non-current portion of notes payable | 19,188,724 | 0 |
Non-current portion of deferred revenue | 1,276,130 | 1,147,278 |
Total liabilities | 26,884,735 | 2,532,967 |
Stockholders' equity (deficit): | ||
Common stock, par value $0.001 - authorized: 42,000,000 shares; issued and outstanding: 22,941,157 and 20,850,848 as of March 31, 2021 and 2020, respectively | 22,941 | 20,851 |
Additional paid in capital | 32,044,335 | 16,589,272 |
Accumulated deficit | (23,844,671) | (17,586,075) |
Accumulated other comprehensive income (loss) | 135,567 | (336,992) |
Total stockholders' equity (deficit) | 8,358,172 | (1,312,944) |
Total liabilities and stockholders' equity (deficit) | $ 35,242,907 | $ 1,220,023 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2021 | Mar. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Common stock, par value per share | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 420,000,000 | 420,000,000 |
Common stock, shares issued | 22,941,157 | 20,850,848 |
Common stock, shares outstanding | 22,941,157 | 20,850,848 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss - USD ($) | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Revenues | ||
Total revenues | $ 0 | $ 0 |
Operating expenses: | ||
Research and development | 1,554,603 | 2,009,323 |
General and administrative | 3,032,138 | 2,769,161 |
Total operating expenses | 4,586,741 | 4,778,484 |
Loss from operations | (4,586,741) | (4,778,484) |
Interest (expense) income | (2,007,687) | 3,926 |
Loss before income tax benefit | (6,594,428) | (4,774,558) |
Provision for income tax benefit | 335,832 | 614,362 |
Net loss | (6,258,596) | (4,160,196) |
Other comprehensive income | ||
Foreign currency translation adjustment, net of tax | 472,559 | 2,896 |
Comprehensive loss | $ (5,786,037) | $ (4,157,300) |
Net loss per share, basic and diluted | $ (0.28) | $ (0.20) |
Weighted average number of common shares outstanding | 22,283,377 | 20,806,307 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Stockholders' Equity (Deficit) - USD ($) | Common Stock | Additional Paid-In Capital | Accumulated Deficit | Accumulated Other Comprehensive Income | 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 under ATM financing net of offering costs, Shares | 14,338 | ||||
Issuance of common shares under ATM financing net of offering costs, Amount | $ 14 | 112,113 | 112,127 | ||
Exercise of warrants, Shares | 2,500 | ||||
Exercise of warrants, Amount | $ 3 | 25,997 | 26,000 | ||
Reverse split adjustment, Shares | 418 | ||||
Reverse split adjustment, Amount | |||||
Restricted shares issued as stock-based compensation, Shares | 68,000 | ||||
Restricted shares issued as stock-based compensation, Amount | $ 68 | 479,257 | 479,325 | ||
Foreign currency translation adjustment | 2,896 | 2,896 | |||
Net loss | (4,160,196) | (4,160,196) | |||
Ending Balance, Shares at Mar. 31, 2020 | 20,850,848 | ||||
Ending 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 costs, Shares | 1,994,924 | ||||
Issuance of common shares, net of costs, Value | $ 1,995 | 14,791,484 | 14,793,479 | ||
Exercise of warrants, Shares | 38,683 | ||||
Exercise of warrants, Amount | $ 38 | 400,465 | 400,503 | ||
Restricted shares issued as stock-based compensation, Shares | 56,702 | ||||
Restricted shares issued as stock-based compensation, Amount | $ 57 | 263,114 | 263,171 | ||
Foreign currency translation adjustment | 472,559 | 472,559 | |||
Net loss | (6,258,596) | (6,258,596) | |||
Ending Balance, Shares at Mar. 31, 2021 | 22,941,157 | ||||
Ending Balance, Amount at Mar. 31, 2021 | $ 22,941 | $ 32,044,335 | $ (23,844,671) | $ 135,567 | $ 8,358,172 |
Consolidated Statements of Ch_2
Consolidated Statements of Changes in Stockholders' Equity (Deficit) (Parenthetical) - USD ($) | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Statement of Stockholders' Equity [Abstract] | ||
Issuance of common shares under ATM financing net of offering costs | $ 40,365 | |
Issuance of common shares net of costs | $ 957,193 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Cash Flows from Operating Activities: | ||
Net loss | $ (6,258,596) | $ (4,160,196) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and Amortization | 98,075 | 54,840 |
Accretion of debt discount | 2,007,687 | 0 |
Loss on disposal of property and equipment | 0 | 12,978 |
Stock Based Compensation | 113,171 | 565,039 |
Changes in assets and liabilities: | ||
Prepaid expenses | (767,050) | 186,281 |
Increase in inventory | (564,313) | (258,523) |
Accounts payable | (39,914) | 138,485 |
Liability due to related party | (681,298) | (91,347) |
Other liabilities and accrued expenses | 94,141 | 102,898 |
Net cash used in operating activities | (5,998,097) | (3,449,545) |
Cash Flows from Investing Activities: | ||
Capitalized patent costs | (81,952) | (53,206) |
Purchase of property and equipment | (90,730) | (157,825) |
Capitalized software development costs | (663,758) | 0 |
Net cash used in investing activities | (836,440) | (211,031) |
Cash Flows from Financing Activities: | ||
Proceeds from issuance of common stock | 15,750,672 | 152,492 |
Costs incurred in relation to equity financing | (957,193) | (40,365) |
Proceeds from warrant exercise | 400,503 | 26,000 |
Proceeds from issuance of notes payable | 25,000,000 | 0 |
Debt issuance costs paid | (1,525,035) | 0 |
Repayments of notes payable | (600,000) | 0 |
Repayments of insurance financing | (82,555) | (40,896) |
Net cash provided by financing activities | 37,986,392 | 97,231 |
Net increase/(decrease)/ in cash | 31,151,855 | (3,563,345) |
Effect of exchange rate changes on cash | 607,409 | (71,212) |
Cash at beginning of year | 106,107 | 3,740,664 |
Cash at end of year | 31,865,371 | 106,107 |
Supplemental disclosure of non-cash financing activities: | ||
Prepayment of equity compensation | 50,000 | 27,400 |
Amount of insurance funded through note payable | 0 | 123,491 |
Licenses acquired through stock issuance | 100,000 | 0 |
Monitoring fees added to notes payable | $ 718,661 | $ 0 |
ORGANIZATION, PRINCIPAL ACTIVIT
ORGANIZATION, PRINCIPAL ACTIVITIES AND MANAGEMENT'S PLANS | 12 Months Ended |
Mar. 31, 2021 | |
Disclosure Text Block [Abstract] | |
ORGANIZATION, PRINCIPAL ACTIVITIES AND MANAGEMENT'S PLANS | NOTE 1 – ORGANIZATION, PRINCIPAL ACTIVITIES AND MANAGEMENT’S PLANS 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®. The sugarBEAT® device is a non-invasive, wireless device for use by persons with Type I and Type II diabetes and may also be used to screen pre-diabetic patients. The sugarBEAT® device extracts analytes, such as glucose, to the surface of the skin in a non-invasive manner where it is measured using unique sensors and interpreted using a unique algorithm. Nemaura is a Nevada holding company organized in 2013. Nemaura owns one hundred percent (100%) of Region Green Limited, a British Virgin Islands corporation (“RGL”) formed on December 12, 2013. RGL owns one hundred percent (100%) of the stock in Dermal Diagnostic (Holdings) Limited, an England and Wales corporation (“DDHL”) formed on December 11, 2013, which in turn owns one hundred percent (100%) of Dermal Diagnostics Limited, an England and Wales corporation formed on January 20, 2009 (“DDL”), and one hundred percent (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® device, which consists of a disposable patch containing a sensor, and a non-disposable miniature transmitter device with a re-chargeable power source, which is designed to enable trending or tracking of blood glucose levels. All of the Company’s operations and assets are located in England. The following diagram illustrates Nemaura’s corporate structure as of March 31, 2021: Nemaura Medical Inc. Nevada Corporation Region Green Limited British Virgin Islands Corporation Dermal Diagnostics (Holdings) Limited England and Wales Corporation Dermal Diagnostics Limited England and Wales Corporation Trial Clinic Limited England and Wales Corporation During the fiscal year ended March 31, 2021, the Board of Directors assessed the adequacy of the group’s organizational structure and concluded that Region Green Limited was no longer required, as the entity had been effectively dormant since inception, and no longer represented a requirement to be maintained. It was therefore determined that Region Green Limited should be unwound, with the intention that the assets held by Region Green Limited be transferred up to Nemaura Medical Inc. following which Region Green Limited would be dissolved. The transfer of assets took place on March 5, 2021 and Region Green Limited was formally dissolved as of April 23, 2021. The Company was incorporated in 2013 and has reported recurring losses from operations to date and an accumulated deficit of $23,844,671 as of March 31, 2021. These operations have resulted in the successful completion of clinical programs to support a CE mark (European Union approval of the product) approval, as well as a De Novo 510(k) medical device application to the U.S. Food and Drug Administration (“FDA”) submission. 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 decrease over time. Management has entered into licensing, supply, or collaboration agreements with unrelated third parties relating to the United Kingdom (“UK”), Europe, Qatar, and all countries in the Gulf Cooperation Council. The Company has $31,865,371 of readily available cash at March 31, 2021, and management has evaluated the expected expenses to be incurred in relation to its available cash and has determined that the Company has the ability to continue as a going concern for at least one year subsequent to the date of issuance of these consolidated financial statements. Following the receipt of the CE mark approval in the EU, and in support of our plans for similar certification with the FDA in the U.S., our plan is to utilize the cash on hand to continue establishing commercial manufacturing operations for the commercial supply of the sugarBEAT® device and sensor patches in our target markets. Management's strategic plans include the following: – support the UK and EU launch of sugarBEAT®; – obtaining further regulatory approval for the sugarBEAT® device in other countries such as the U.S.; – exploring licensing and partnership opportunities in other territories; – developing the sugarBEAT® device platform for commercialization across other applications; and – pursue additional capital raising opportunities should they be required to further enhance our growth plans. |
BASIS OF PRESENTATION
BASIS OF PRESENTATION | 12 Months Ended |
Mar. 31, 2021 | |
Disclosure Text Block [Abstract] | |
Basis of Presentation | NOTE 2 – BASIS OF PRESENTATION The accompanying consolidated financial statements include the accounts of the Company and the Company’s subsidiaries, DDL, TCL, DDHL and RGL. The consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”), and all significant intercompany balances and transactions have been eliminated in consolidation. The functional currency for the majority of the Company’s operations is the Great Britain Pound Sterling (“GBP”), and the reporting currency is the U.S. Dollar (“U.S.$”). |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND RECENT ACCOUNTING PRONOUNCEMENTS | 12 Months Ended |
Mar. 31, 2021 | |
Disclosure Text Block [Abstract] | |
Summary of significant accounting policies and recent accounting pronouncements | NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND RECENT ACCOUNTING PRONOUNCEMENTS Cash Cash consists primarily of cash deposits maintained in the UK. Fair value of financial instruments In accordance with Financial Accounting Standard Board (“FASB”) Accounting Standards Codification (“ASC”) 820, “Fair Value Measurements and Disclosures,” the Company determines the fair value of financial instruments with the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. ASC 820 prioritizes the inputs into three levels that may be used to measure fair value: Level 1 Level 2 Level 3 Property and equipment Property and equipment is stated at cost and depreciated using the straight-line method over the estimated useful lives of the assets, generally four to five years. This is charged to operating expenses. Intangible assets Intangible assets consist of licenses and patents associated primarily with the sugarBEAT® device and are amortized on a straight-line basis, generally over their legal lives of up to 20 years and are reviewed for impairment. Costs capitalized relate to invoices received from third parties and not any internal costs. The Company evaluates its intangible assets (all have finite lives) and other long-lived assets for impairment whenever events or circumstances indicate that they may not be recoverable, or at least annually. Recoverability of finite and other long-lived assets is measured by comparing the carrying amount of an asset group to the future undiscounted net cash flows expected to be generated by that asset group. The Company groups assets for purposes of such review at the lowest level for which identifiable cash flows of the asset group are largely independent of the cash flows of the other groups of assets and liabilities. The amount of impairment to be recognized for finite and other long-lived assets is calculated as the difference between the carrying value and the fair value of the asset group, generally measured by discounting estimated future cash flows. There were no impairment indicators present during the years ended March 31, 2021 or 2020. Software development costs Capitalization of software development costs incurred in the research and development of new software products and enhancements to existing software products for external use begins when a product’s technological feasibility has been established and ends when the resulting product is available for general market release. Amortization of the capitalized software is classified within product cost of goods sold in the consolidated statements of operations and comprehensive loss. For each capitalized software product, the annual amortization is equal to the greater of: 1. The amount computed using the ratio of software product’s current fiscal year gross revenue bears to the total current fiscal year and anticipated future gross revenues for the product, or 2. The amount computed based on a straight-line method over the remaining estimated economic life of the product, which can be a range between 3 – 8 years. Annually, or more frequently if required by triggering events, an analysis of the net realizable value of the capitalized software is completed and the amount by which unamortized software costs exceeds the net realisable value, if any, is recognized as a charge to income in the period it is determined. Revenue recognition While the Company is not currently recognizing revenue, we have considered the guidelines within ASC Topic 606, Revenue from Contracts with Customers . The Company may enter into product development and other agreements with collaborative partners. The terms of the agreements may include non-refundable signing and licensing fees, milestone payments and royalties on any product sales derived from collaborations. Deferred revenue The Company has entered into license agreements and for these, recognizes up front license payments as revenue upon delivery of the license only if the license has stand-alone value to the customer. However, where further performance criteria must be met, revenue is deferred and recognized on a straight-line basis over the period the Company is expected to complete its performance obligations. Royalty revenue will be recognized upon the sale of the related products provided the Company has no remaining performance obligations under the agreement. Inventory Inventory is stated at the lower of cost or net realizable value, with cost determined on a first-in first-out basis. At present all inventory relates to raw materials purchased from third parties and to be used in the Company’s product. Income taxes Income taxes are accounted for under the asset and liability method. Deferred income tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, and operating loss carry forwards. Deferred income tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred income tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is provided to reduce the carrying amount of deferred income tax assets if it is considered more likely than not that some portion, or all, of the deferred income tax assets will not be realized. The Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Company has elected to classify interest and penalties related to unrecognized tax benefits as part of income tax expense in the consolidated statements of comprehensive loss. The Company does not have any accrued interest or penalties associated with any unrecognized tax benefits, nor was any interest expense related to unrecognized tax benefits recognized for the years ended March 31, 2021 and 2020. In December 2017, the U.S. Tax Cuts and Jobs Act was signed into law. Generally, this Act reduces corporate rates from a top rate of 35% to a top rate of 21%, effective January 1, 2018. As the Company’s U.S. operations are minimal, and all deferred tax assets maintain a full valuation allowance, there is no significant impact to the Company as of and for the years ended March 31, 2021 and 2020. Earnings (loss) per share Basic earnings (loss) per share is computed by dividing income (loss) available to common stockholders by the weighted-average number of common shares outstanding during the period. For the years ended March 31, 2021, warrants to purchase 1,939,990 shares of common stock and a unit purchase option to purchase 9,710 shares of common stock as well as 9,710 warrants were considered anti-dilutive and were excluded from the calculation of diluted loss per share. For the year ended March 31, 2020, warrants to purchase 1,185,570 shares of common stock and a unit purchase option to purchase 9,710 shares of common stock as well as 9,710 warrants were considered anti-dilutive and were also excluded from the calculation of diluted loss per share. Use of estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the periods presented. Actual results may differ from those estimates. Foreign currency translation The functional currency of the Company is the GBP, while the reporting currency is the U.S.$. Assets and liabilities are translated at the exchange rates as of the balance sheet date with income and expenses being translated at the weighted-average exchange rates prevailing during the reporting period. Stockholders' equity is translated into U.S.$ from GBP at historical exchange rates. Adjustments resulting from translating the consolidated financial statements into U.S.$ are recorded as a separate component of accumulated other comprehensive loss in stockholders’ equity. Retirement benefit plan The Company operates a retirement plan which covers most of our regular employees in the UK and allows them to make contributions. The Company also provides a matching contribution on a portion of the employee contributions. Total expenses incurred under this plan for the financial periods ending March 31, 2021 and 2020, were approximately $12,100 and $7,000, respectively. The increase in the year being driven by an increase in our employee numbers. Stock-based compensation The Company accounts for stock-based payments in accordance with stock-based payment accounting guidance which requires all stock-based payments to be recognized based upon their fair values. The fair value of stock-based awards is estimated at the grant date using the Black-Scholes Option Pricing Model and the portion that is ultimately expected to vest is recognized as compensation cost over the requisite service period. The determination of fair value using the Black-Scholes Option Pricing Model is affected by the Company’s stock price as well as assumptions regarding a number of complex and subjective variables, including expected stock price volatility, risk-free interest rate, expected dividends and projected employee stock option exercise behaviors. The Company accounts for forfeitures of unvested awards as they occur. To date, the Company has not granted any stock-based compensation awards to employees. The Company accounts for share-based payments to non-employees by aligning it with the accounting for share-based payments to employees, with certain exceptions. Direct costs incurred for equity financing The Company includes all direct costs incurred in connection with successful equity financings as a component of additional paid-in capital. Direct costs incurred for equity financings that are unsuccessful are expensed. Risks and Uncertainties The Company is in the commercialization stage for its primary product, sugarBEAT®, following the receipt of the CE mark covering the EU, with the intention of entering into sales and marketing agreements for the product with prioritization having been initially set for the UK and Germany. Aside from the UK and Germany, the Company considers the U.S.A. to be a primary market for its product offerings, and while uncertainties exist with regards to regulatory acceptance of the Company’s primary product, an FDA PMA application has been submitted and is currently being reviewed; some delays have been experienced as a direct consequence of COVID-19, whereby the application remained dormant with the FDA for a period of 6 months. In the interim, and further to discussions with the FDA, the Company has determined that it may sell an adapted version of the CGM device as a wellbeing device, whereby the Company will gather the data and provide feedback in the form of educational reports providing insights into factors that may be causing glucose fluctuations and therefore how lifestyle interventions may help improve control of the fluctuations. The Company has taken steps to support the commercialization process by increasing raw material inventory over the year in the expectation of receiving initial orders from the existing UK license, which was subsequently received in April 2021. Currently an evaluation is being undertaken as to the internal manufacturing capabilities of the Company, and while it has not entered into any exclusive manufacturing agreements with any of its contract manufacturers, it is anticipated that as volume increases, alternative manufacturing options will be considered. Reverse stock split The activity described in these consolidated financial statements reflects the one for ten reverse split which was effective on November 27, 2019. All shares and amounts included have been retroactively restated. Recent 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. |
LICENSING AGREEMENT
LICENSING AGREEMENT | 12 Months Ended |
Mar. 31, 2021 | |
Disclosure Text Block [Abstract] | |
Licensing Agreement | NOTE 4 – 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 with an unrelated third party that granted to the third party the exclusive right to market and promote the sugarBEAT® device and related patches under its own brand in the United Kingdom and the Republic of Ireland, the Channel Islands and the Isle of Man. The Company received a non-refundable, up-front cash payment of GBP 1,000,000 (approximately $1.38 million and $1.24 million as of March 31, 2021 and 2020, respectively), which was wholly non-refundable, upon signing the agreement. As the Company has continuing performance obligations under the agreement, the up-front fees received from this agreement have been deferred and will be recorded as income over the term of the commercial licensing agreement beginning from the date of clinical evaluation approval. As the Company expects commercialization of the sugarBEAT® device to occur in the year ending March 31, 2022, approximately $103,000 of the deferred revenue has been classified as a current liability as of March 31, 2021. |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 12 Months Ended |
Mar. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT | NOTE 5 – PROPERTY AND EQUIPMENT As of March 31, 2021 and March 31, 2020, property and equipment is summarized as follows: March 31, 2021 ($) 2020 ($) Property and equipment 346,500 226,548 Less accumulated depreciation (144,355 ) (64,484 ) 202,145 162,064 Depreciation expensed within the consolidated statements of operations and comprehensive loss relating to property and equipment for the years ended March 31, 2021 and 2020 was approximately $69,000 and $46,000, respectively. |
INTANGIBLE ASSETS
INTANGIBLE ASSETS | 12 Months Ended |
Mar. 31, 2021 | |
Disclosure Text Block [Abstract] | |
Intangible Assets | NOTE 6 - INTANGIBLE ASSETS The following table summarises our intangible assets and capitalized software development costs at March 31, 2021 and 2020: March 31, 2021 ($) 2020 ($) Patents and licenses 516,935 307,009 Less accumulated amortization (125,437 ) (93,929 ) 391,498 213,080 Software development costs 663,758 — 1,055,256 213,080 Amortization expensed within the consolidated statements of operations and comprehensive loss relating to intangible assets for the years ended March 31, 2021 and 2020 was approximately $29,000 and $19,000, respectively. The following table represents the estimated amortization for intangible assets relating to patents and licenses for the years ending March 31; no amortization has been estimated for software development as this is considered to be work-in-progress and the final costs are yet to be determined: ($) 2022 37,139 2023 54,930 2024 53,826 2025 53,770 2026 52,427 Thereafter 139,406 Total future net intangible amortization expense 391,498 |
PREPAID EXPENSES
PREPAID EXPENSES | 12 Months Ended |
Mar. 31, 2021 | |
Notes to Financial Statements | |
PREPAID EXPENSES | NOTE 7 – PREPAID EXPENSES March 31, 2021 2020 Prepaid expenses 592,695 351,755 Prepaid inventory 587,493 — Other taxes 89,325 100,708 1,269,513 452,463 |
NOTES PAYABLE
NOTES PAYABLE | 12 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Notes Payable | NOTE 8 – NOTES PAYABLE NOTE PURCHASE AGREEMENT 1 On April 15, 2020, the Company entered into a note purchase agreement (the “Note Purchase Agreement 1”) by and among the Company, DDL, TCL and a third party investor (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” and 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 the Collateral (as hereinafter defined). The Secured Note carries an original issue discount (“OID”) of $1,000,000 (16.7%). 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”). In addition to this, a payment of $325,000 was made to Ascendiant Capital Markets, LLC, (the “Commission”) for structuring the agreement between both parties. The Purchase Price for the Secured Note is $4,675,000, computed as follows: $6,015,000 original principal balance, less: OID, Transaction Expense Amount, and commission paid. The borrowing period is 24 months, and the Company shall pay the outstanding balance and all fees on maturity. 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. The debt less the discount and transaction expenses will be accreted over the term of the Note using the effective interest method. Security Agreement On April 15, 2020, the Company entered into the Security Agreement by the Company, DDL and TCL, in favor of the Investor (the “Security Agreement”). Pursuant to the terms of the Security Agreement, the Company granted the Investor a first-priority security interest in all rights, title, interest, claims and demands of the Company in and to all of the Company’s patents and all other proprietary rights, and all rights corresponding to the Company’s patents throughout the world, now owned and existing, and all replacements, proceeds, products, and accessions thereof. NOTE PURCHASE AGREEMENT 2 On February 8, 2021, the Company entered into an additional note purchase agreement (“Note Purchase Agreement 2”) with the Investor. Pursuant to the terms of Note Purchase Agreement 2, the Company agreed to issue and sell to the Investor and the Investor agreed to purchase from the Company, a secured promissory note (“Secured Note 2”) in the original principal amount of $24,015,000. The Secured Note carries an OID of $4,000,000 (16.7%), and the Company agreed to pay $15,000 to the Investor to cover the Investor’s transaction expenses. In addition to this, a Commission of $1,200,000 was also payable to Ascendiant Capital Partners, LLC. In consideration thereof, on February 9, 2021 (the “closing date”), (i) the Investor paid $20,000,000 in cash to the Company, and (ii) the Company delivered Secured Note 2 on behalf of the Company, to the Investor, against the delivery of the Purchase Price. For these purposes, the “Purchase Price” means the Investor’s initial cash purchase price. After adjusting for transaction expenses of $1,200,000, cash proceeds received were $18,800,000. The borrowing terms for Note Purchase Agreement 2 are consistent with those of Note Purchase Agreement 1, with the borrowing period being 24 months from the date of the agreement, the Company being required to pay the outstanding balance and all fees on maturity, and a monitoring fee equal to 0.833% of the outstanding balance being automatically added to the outstanding balance on the first day of each month. The debt less discount and transaction expenses will be accreted over the term of the Note using the effective interest rate method. Security Agreement On February 8, 2021, the Security Agreement established in respect to Note Purchase Agreement 1 was extended to include Note Purchase Agreement 2, which is also secured against all of the Company’s assets owned as of the closing date and extends to any assets acquired at any time that the Company’s obligations under Secured Note 2 are outstanding. As of March 31, 2021, long-term debt matures as follows: Year Ending Notes Payable ($) 2022 5,733,370 2023 19,188,724 24,922,094 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Mar. 31, 2021 | |
Disclosure Text Block [Abstract] | |
Related Party Transactions | NOTE 9 – RELATED PARTY TRANSACTIONS Nemaura Pharma Limited (“Pharma”), Black and White Health Care Limited (“B&W”) and NDM Technologies Limited (“NDM”) are entities controlled by the Company’s chief executive officer and majority shareholder, D.F.H. Chowdhury. 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 following is a summary of activity between the Company and Pharma, B&W and NDM for the years ended March 31, 2021 and 2020: March 31, 2021 ($) 2020 ($) Liability due to related parties at beginning of year 830,093 964,679 Amounts invoiced by Pharma to DDL, NM and TCL (1) 2,441,108 1,800,517 Amounts invoiced by DDL to Pharma (17,213 ) (10,963 ) Amounts repaid by DDL to Pharma (3,209,084 ) (1,897,222 ) Foreign exchange differences 103,891 (26,918 ) Liability due to related parties at end of year 148,795 830,093 (1) These invoiced amounts primarily relate to research and development expenses. All related party transactions relate to operating activities in the years ended March 31, 2021 and 2020. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Mar. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | NOTE 10 – INCOME TAXES The Company and its subsidiaries file separate income tax returns. United States of America The Company is incorporated in the U.S. and is subject to a U.S. federal corporate income tax rate of 21% for the years ended March 31, 2021 and March 31, 2020. British Virgin Islands RGL is incorporated in the British Virgin Islands (“BVI”). Under the current laws of the BVI, RGL is not subject to tax on income or capital gains. In addition, upon payments of dividends by RGL, no BVI withholding tax is imposed. During the years ended March 31, 2021 and 2020, there were no income or expenses in the BVI. UK DDL, TCL and DDHL are all incorporated in the UK and the applicable UK statutory income tax rate for these companies is 19%. For the years ended March 31, 2021 and 2020 loss before income tax benefit arose in the UK and U.S. as follows: March 31, 2021 2020 $ $ Loss before income taxes arising in UK (5,030,204 ) (2,470,107 ) Loss before income taxes arising in U.S. (1,564,224 ) (2,304,451 ) Total loss before income tax benefit (6,594,428 ) (4,774,558 ) Reconciliation of our effective tax rate to the loss calculated at the statutory U.S. federal tax rate is as follows: March 31, 2021 2020 $ $ Loss before income taxes (6,594,428 ) (4,774,558 ) Expected tax benefit (1,384,830 ) (21 %) (1,003,000 ) (21 %) Foreign tax differential 100,604 2 % — 0 % Enhanced research and development (259,861 ) (4 %) (231,000 ) (5 %) Other 20,226 — 125,000 2 % Change in rate allowance — — 119,000 2 % Change in valuation allowance 1,523,861 23 % 990,000 21 % R&D credit received 335,832 5 % 614,362 13 % Actual income tax benefit 335,832 5 % 614,362 13 % The tax effects of the temporary differences that give rise to significant portions of deferred income tax assets are presented below: March 31, 2021 2020 $ $ Net operating tax loss carried forward 5,204,000 3,926,000 Research and development enhancement 1,057,000 797,000 Other items (333,000 ) (319,000 ) Valuation allowance (5,928,000 ) (4,404,000 ) Net deferred tax assets — — In the year ended March 31, 2021, the Company received $335,832 from HMRC (Her Majesty’s Revenue and Customs) in tax credits relating to the reimbursement of research and development expenses incurred during the year ended March 31, 2020; for the year ended March 31, 2020, the research and development tax credit received was $614,362, relating to expenses incurred for the years ended March 31, 2019 and 2018, respectively. These amounts are reflected as a credit provision for income taxes in the Company’s consolidated statements of operations and comprehensive loss in the respective years received. For each of the years ended March 31, 2021 and 2020, the Company did not have unrecognized tax benefits, and therefore no interest or penalties related to unrecognized tax benefits were accrued. Management does not expect that the amount of unrecognized tax benefits will change significantly within the next twelve months. The Company mainly files income tax returns in the U.S. and the UK. The Company is subject to U.S. federal income tax examination by tax authorities for tax years beginning in 2017. The UK tax returns for the Company’s UK subsidiaries are open to examination by the UK tax authorities for the tax years beginning April 1, 2015. As of March 31, 2021, the Company has net operating losses (“NOLs”) of approximately $7,096,000 in the U.S. and $19,546,000 in the UK. NOLs may be carried forward indefinitely. Additionally, the Company has a research and development enhancement deduction carry forward of approximately $5,561,000 for purposes of UK income tax filings. |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 12 Months Ended |
Mar. 31, 2021 | |
Equity [Abstract] | |
STOCKHOLDERS' EQUITY | NOTE 11 – STOCKHOLDERS’ EQUITY Reverse stock split The Company was notified by 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. The Company effected: (i) A reverse split of the Company’s issued and outstanding common stock, par value $0.001 per share 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 which were effective with NASDAQ at the opening of business on December 5, 2019. On December 19, 2019, the Company received confirmation from NASDAQ that the Company has regained compliance with the Minimum Bid Price Rule and the matter is now resolved. 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 (the “Offering”), up to $20,000,000 in shares of its common stock (the “Shares”). Between March 31, 2019 and March 31, 2020, the Company issued 14,338 shares of its common stock through the Distribution Agreement and received gross proceeds of $152,492 and costs of $40,365 were incurred. For the year ended March 31, 2021, a total of 408,718 shares were issued generating gross proceeds of $4,250,676 and costs of $127,520. 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. On December 18, 2018, the Company entered into a placement agency agreement with Dawson James Securities, Inc. with respect to the issuance and sale of an aggregate of up to 240,000 units, each unit consisting of one share of common stock, together with one warrant to purchase one share of common stock at an exercise price equal to $10.40 per share, in a public offering. The warrants offered in the public offering will terminate on the fifth anniversary of the date of issuance. The public offering price for each unit was $10.40. The closing of the offering occurred on December 20, 2018, and at such closing the Company sold 194,206 shares of common stock and 194,206 warrants for gross proceeds of $2,019,743. The net proceeds to the Company from the sale of the shares of common stock and the warrants was $1,691,541, after deducting $328,302 of placement agent commissions and other offering expenses payable by the Company. As of March 31, 2021, 46,569 of the warrants had been exercised, generating $484,318 of additional funds. At March 31, 2021, there were 147,637 warrants outstanding. 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. As of March 31, 2021, 750 of the warrants had been exercised, generating $6,000 of additional funds, leaving 792,353 warrants outstanding in relation to this placement. 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 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 per unit. |
OTHER ITEMS
OTHER ITEMS | 12 Months Ended |
Mar. 31, 2021 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
OTHER ITEMS | NOTE 12 – 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, to date, 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) Investor relations agreements The Company has entered into contracts with several investor relations specialists to help support the ongoing financing activities of the business. During the fiscal year ended March 31, 2021, the Company entered into a contractual agreement with a new investor relations company, the term of which was set at 12 months with the related compensation being paid via a mixture of cash and common stock. Total stock-based compensation expense for the year ended March 31, 2021, in relation to this was $50,000. In addition to this, $59,000 was paid by way of stock-based compensation to two additional investor relations companies, whose services were terminated during the year. During the fiscal year ended March 31, 2020, the Company engaged two different investor relations companies to act on its behalf. One contract ended in May 2019 with total stock-based compensation expense for the year of $17,888; the other contract resulted in cash fees expensed for the year of $59,500 with 16,250 shares issued and expensed to investor relations for consideration of $116,461. (c) Management Consulting Agreement During the year ended March 31, 2020, the Company continued to work with a management consulting company, services for which were terminated during that period. The scope of the agreement covered a range of services and resulted in a cash expense totalling $186,176 and stock-based compensation of $98,150 being paid. During the year ended March 31, 2021, no similar consulting services were engaged aside from those noted above in respect to specialist investor relations. (d) Debt Financing During the year ended March 31, 2020, the Company entered into an agreement with a bank to finance an invoice payable related to an insurance policy. The principal was $132,342 to be repaid over 9 monthly payments with interest charged at an annual percentage rate of 13.9%. This policy was cancelled and repaid in full. A second insurance policy was entered into by the Company with a bank to finance an invoice payable related to an insurance policy. The principal was $123,451 to be repaid over three quarterly payments with interest charged at an annual percentage rate of 5.28%. The remaining balance of $82,555 is included within other liabilities and accrued expenses on the March 31, 2020, consolidated balance sheet. During the year ended March 31, 202 , the Company settled all outstanding liabilities relating to this debt financing. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Mar. 31, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | NOTE 13 – Subsequent Events Exercise of Warrants Subsequent to March 31, 2021, and through June 28, 2021, the Company raised gross proceeds of $2,963,658 from the exercise of warrants and the issuance of 366,892 shares at an average exercise price of $8.08 per share. Dissolution of Region Green Limited During the year ended March 31, 2021, the board of directors determined that there was no longer a requirement to retain the existing group structure and that an opportunity existed to simplify this by removing the intermediary holding company, Region Green Limited (“RGL”), a company incorporated within the British Virgin Islands. It was therefore determined that this group company be dissolved at the earliest convenient date, which transpired to be April 23 rd All assets and liabilities held by RGL were transferred up to the immediate and ultimate parent, Nemaura Medical Inc. on March 5 th |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND RECENT ACCOUNTING PRONOUNCEMENTS (Policies) | 12 Months Ended |
Mar. 31, 2021 | |
Policy Text Block [Abstract] | |
Cash | Cash Cash consists primarily of cash deposits maintained in the UK. |
Fair Value of Financial Instruments | Fair value of financial instruments In accordance with Financial Accounting Standard Board (“FASB”) Accounting Standards Codification (“ASC”) 820, “Fair Value Measurements and Disclosures,” the Company determines the fair value of financial instruments with the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. ASC 820 prioritizes the inputs into three levels that may be used to measure fair value: Level 1 Level 2 Level 3 |
Property and equipment | Property and equipment Property and equipment is stated at cost and depreciated using the straight-line method over the estimated useful lives of the assets, generally four to five years. This is charged to operating expenses. |
Intangible Assets | Intangible assets Intangible assets consist of licenses and patents associated primarily with the sugarBEAT® device and are amortized on a straight-line basis, generally over their legal lives of up to 20 years and are reviewed for impairment. Costs capitalized relate to invoices received from third parties and not any internal costs. The Company evaluates its intangible assets (all have finite lives) and other long-lived assets for impairment whenever events or circumstances indicate that they may not be recoverable, or at least annually. Recoverability of finite and other long-lived assets is measured by comparing the carrying amount of an asset group to the future undiscounted net cash flows expected to be generated by that asset group. The Company groups assets for purposes of such review at the lowest level for which identifiable cash flows of the asset group are largely independent of the cash flows of the other groups of assets and liabilities. The amount of impairment to be recognized for finite and other long-lived assets is calculated as the difference between the carrying value and the fair value of the asset group, generally measured by discounting estimated future cash flows. There were no impairment indicators present during the years ended March 31, 2021 or 2020. |
Software development costs | Software development costs Capitalization of software development costs incurred in the research and development of new software products and enhancements to existing software products for external use begins when a product’s technological feasibility has been established and ends when the resulting product is available for general market release. Amortization of the capitalized software is classified within product cost of goods sold in the consolidated statements of operations and comprehensive loss. For each capitalized software product, the annual amortization is equal to the greater of: 1. The amount computed using the ratio of software product’s current fiscal year gross revenue bears to the total current fiscal year and anticipated future gross revenues for the product, or 2. The amount computed based on a straight-line method over the remaining estimated economic life of the product, which can be a range between 3 – 8 years. Annually, or more frequently if required by triggering events, an analysis of the net realizable value of the capitalized software is completed and the amount by which unamortized software costs exceeds the net realisable value, if any, is recognized as a charge to income in the period it is determined. |
Revenue Recognition | Revenue recognition While the Company is not currently recognizing revenue, we have considered the guidelines within ASC Topic 606, Revenue from Contracts with Customers . The Company may enter into product development and other agreements with collaborative partners. The terms of the agreements may include non-refundable signing and licensing fees, milestone payments and royalties on any product sales derived from collaborations. |
Deferred revenue | Deferred revenue The Company has entered into license agreements and for these, recognizes up front license payments as revenue upon delivery of the license only if the license has stand-alone value to the customer. However, where further performance criteria must be met, revenue is deferred and recognized on a straight-line basis over the period the Company is expected to complete its performance obligations. Royalty revenue will be recognized upon the sale of the related products provided the Company has no remaining performance obligations under the agreement. |
Inventory | Inventory Inventory is stated at the lower of cost or net realizable value, with cost determined on a first-in first-out basis. At present all inventory relates to raw materials purchased from third parties and to be used in the Company’s product. |
Income taxes | Income taxes Income taxes are accounted for under the asset and liability method. Deferred income tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, and operating loss carry forwards. Deferred income tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred income tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is provided to reduce the carrying amount of deferred income tax assets if it is considered more likely than not that some portion, or all, of the deferred income tax assets will not be realized. The Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Company has elected to classify interest and penalties related to unrecognized tax benefits as part of income tax expense in the consolidated statements of comprehensive loss. The Company does not have any accrued interest or penalties associated with any unrecognized tax benefits, nor was any interest expense related to unrecognized tax benefits recognized for the years ended March 31, 2021 and 2020. In December 2017, the U.S. Tax Cuts and Jobs Act was signed into law. Generally, this Act reduces corporate rates from a top rate of 35% to a top rate of 21%, effective January 1, 2018. As the Company’s U.S. operations are minimal, and all deferred tax assets maintain a full valuation allowance, there is no significant impact to the Company as of and for the years ended March 31, 2021 and 2020. |
Earnings (loss) per share | Earnings (loss) per share Basic earnings (loss) per share is computed by dividing income (loss) available to common stockholders by the weighted-average number of common shares outstanding during the period. For the years ended March 31, 2021, warrants to purchase 1,939,990 shares of common stock and a unit purchase option to purchase 9,710 shares of common stock as well as 9,710 warrants were considered anti-dilutive and were excluded from the calculation of diluted loss per share. For the year ended March 31, 2020, warrants to purchase 1,185,570 shares of common stock and a unit purchase option to purchase 9,710 shares of common stock as well as 9,710 warrants were considered anti-dilutive and were also excluded from the calculation of diluted loss per share. |
Use of estimates | Use of estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the periods presented. Actual results may differ from those estimates. |
Foreign currency translation | Foreign currency translation The functional currency of the Company is the GBP, while the reporting currency is the U.S.$. Assets and liabilities are translated at the exchange rates as of the balance sheet date with income and expenses being translated at the weighted-average exchange rates prevailing during the reporting period. Stockholders' equity is translated into U.S.$ from GBP at historical exchange rates. Adjustments resulting from translating the consolidated financial statements into U.S.$ are recorded as a separate component of accumulated other comprehensive loss in stockholders’ equity. |
Retirement benefit plan | Retirement benefit plan The Company operates a retirement plan which covers most of our regular employees in the UK and allows them to make contributions. The Company also provides a matching contribution on a portion of the employee contributions. Total expenses incurred under this plan for the financial periods ending March 31, 2021 and 2020, were approximately $12,100 and $7,000, respectively. The increase in the year being driven by an increase in our employee numbers. |
Stock-based compensation | Stock-based compensation The Company accounts for stock-based payments in accordance with stock-based payment accounting guidance which requires all stock-based payments to be recognized based upon their fair values. The fair value of stock-based awards is estimated at the grant date using the Black-Scholes Option Pricing Model and the portion that is ultimately expected to vest is recognized as compensation cost over the requisite service period. The determination of fair value using the Black-Scholes Option Pricing Model is affected by the Company’s stock price as well as assumptions regarding a number of complex and subjective variables, including expected stock price volatility, risk-free interest rate, expected dividends and projected employee stock option exercise behaviors. The Company accounts for forfeitures of unvested awards as they occur. To date, the Company has not granted any stock-based compensation awards to employees. The Company accounts for share-based payments to non-employees by aligning it with the accounting for share-based payments to employees, with certain exceptions. |
Direct costs incurred for equity financing | Direct costs incurred for equity financing The Company includes all direct costs incurred in connection with successful equity financings as a component of additional paid-in capital. Direct costs incurred for equity financings that are unsuccessful are expensed. |
Risks and Uncertainties | Risks and Uncertainties The Company is in the commercialization stage for its primary product, sugarBEAT®, following the receipt of the CE mark covering the EU, with the intention of entering into sales and marketing agreements for the product with prioritization having been initially set for the UK and Germany. Aside from the UK and Germany, the Company considers the U.S.A. to be a primary market for its product offerings, and while uncertainties exist with regards to regulatory acceptance of the Company’s primary product, an FDA PMA application has been submitted and is currently being reviewed; some delays have been experienced as a direct consequence of COVID-19, whereby the application remained dormant with the FDA for a period of 6 months. In the interim, and further to discussions with the FDA, the Company has determined that it may sell an adapted version of the CGM device as a wellbeing device, whereby the Company will gather the data and provide feedback in the form of educational reports providing insights into factors that may be causing glucose fluctuations and therefore how lifestyle interventions may help improve control of the fluctuations. The Company has taken steps to support the commercialization process by increasing raw material inventory over the year in the expectation of receiving initial orders from the existing UK license, which was subsequently received in April 2021. Currently an evaluation is being undertaken as to the internal manufacturing capabilities of the Company, and while it has not entered into any exclusive manufacturing agreements with any of its contract manufacturers, it is anticipated that as volume increases, alternative manufacturing options will be considered. |
Reverse stock split | Reverse stock split The activity described in these consolidated financial statements reflects the one for ten reverse split which was effective on November 27, 2019. All shares and amounts included have been retroactively restated. |
Recent accounting pronouncements | Recent 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. |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 12 Months Ended |
Mar. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT | As of March 31, 2021 and March 31, 2020, property and equipment is summarized as follows: March 31, 2021 ($) 2020 ($) Property and equipment 346,500 226,548 Less accumulated depreciation (144,355 ) (64,484 ) 202,145 162,064 |
INTANGIBLE ASSETS (Tables)
INTANGIBLE ASSETS (Tables) | 12 Months Ended |
Mar. 31, 2021 | |
Table Text Block Supplement [Abstract] | |
Schedule of Intangible Assets | The following table summarises our intangible assets and capitalized software development costs at March 31, 2021 and 2020: March 31, 2021 ($) 2020 ($) Patents and licenses 516,935 307,009 Less accumulated amortization (125,437 ) (93,929 ) 391,498 213,080 Software development costs 663,758 — 1,055,256 213,080 |
Schedule of amortization expenses | The following table represents the estimated amortization for intangible assets relating to patents and licenses for the years ending March 31; no amortization has been estimated for software development as this is considered to be work-in-progress and the final costs are yet to be determined: ($) 2022 37,139 2023 54,930 2024 53,826 2025 53,770 2026 52,427 Thereafter 139,406 Total future net intangible amortization expense 391,498 |
PREPAID EXPENSES (Tables)
PREPAID EXPENSES (Tables) | 12 Months Ended |
Mar. 31, 2021 | |
Notes to Financial Statements | |
PREPAID EXPENSES | March 31, 2021 2020 Prepaid expenses 592,695 351,755 Prepaid inventory 587,493 — Other taxes 89,325 100,708 1,269,513 452,463 |
NOTES PAYABLE (Tables)
NOTES PAYABLE (Tables) | 12 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of Maturities of Long-term Debt | As of March 31, 2021, long-term debt matures as follows: Year Ending Notes Payable ($) 2022 5,733,370 2023 19,188,724 24,922,094 |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 12 Months Ended |
Mar. 31, 2021 | |
Table Text Block Supplement [Abstract] | |
Schedule of Related Party Transactions | The following is a summary of activity between the Company and Pharma, B&W and NDM for the years ended March 31, 2021 and 2020: March 31, 2021 ($) 2020 ($) Liability due to related parties at beginning of year 830,093 964,679 Amounts invoiced by Pharma to DDL, NM and TCL (1) 2,441,108 1,800,517 Amounts invoiced by DDL to Pharma (17,213 ) (10,963 ) Amounts repaid by DDL to Pharma (3,209,084 ) (1,897,222 ) Foreign exchange differences 103,891 (26,918 ) Liability due to related parties at end of year 148,795 830,093 (1) These invoiced amounts primarily relate to research and development expenses. |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Mar. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Schedule of loss before Income Tax, Domestic and Foreign | For the years ended March 31, 2021 and 2020 loss before income tax benefit arose in the UK and U.S. as follows: March 31, 2021 2020 $ $ Loss before income taxes arising in UK (5,030,204 ) (2,470,107 ) Loss before income taxes arising in U.S. (1,564,224 ) (2,304,451 ) Total loss before income tax benefit (6,594,428 ) (4,774,558 ) |
Reconciliation of effective tax rate | Reconciliation of our effective tax rate to the loss calculated at the statutory U.S. federal tax rate is as follows: March 31, 2021 2020 $ $ Loss before income taxes (6,594,428 ) (4,774,558 ) Expected tax benefit (1,384,830 ) (21 %) (1,003,000 ) (21 %) Foreign tax differential 100,604 2 % — 0 % Enhanced research and development (259,861 ) (4 %) (231,000 ) (5 %) Other 20,226 — 125,000 2 % Change in rate allowance — — 119,000 2 % Change in valuation allowance 1,523,861 23 % 990,000 21 % R&D credit received 335,832 5 % 614,362 13 % Actual income tax benefit 335,832 5 % 614,362 13 % |
Schedule of deferred income tax assets | The tax effects of the temporary differences that give rise to significant portions of deferred income tax assets are presented below: March 31, 2021 2020 $ $ Net operating tax loss carried forward 5,204,000 3,926,000 Research and development enhancement 1,057,000 797,000 Other items (333,000 ) (319,000 ) Valuation allowance (5,928,000 ) (4,404,000 ) Net deferred tax assets — — |
ORGANIZATION, PRINCIPAL ACTIV_2
ORGANIZATION, PRINCIPAL ACTIVITIES AND MANAGEMENT'S PLANS (Details Narrative) - USD ($) | Mar. 31, 2021 | Mar. 31, 2020 |
Disclosure Text Block [Abstract] | ||
Accumulated deficit | $ (23,844,671) | $ (17,586,075) |
Cash available on hand | $ 31,865,371 |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND RECENT ACCOUNTING PRONOUNCEMENTS (Details Narrative) - USD ($) | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Impairment charges | $ 0 | $ 0 |
Unrecognized tax benefits | $ 0 | $ 0 |
Effective income tax rate | 21.00% | 35.00% |
Retirement benefit plan expenses | $ 12,100 | $ 7,000 |
Warrants [Member] | ||
Anti-dilutive common stock | 1,939,990 | 1,185,570 |
Warrants One [Member] | ||
Anti-dilutive common stock | 9,710 | 9,710 |
Option [Member] | ||
Anti-dilutive common stock | 9,710 | 9,710 |
LICENSING AGREEMENT (Details Na
LICENSING AGREEMENT (Details Narrative) - USD ($) | Mar. 31, 2021 | Mar. 31, 2020 |
Licensing Agreement Details Narrative | ||
Non-refundable, upfront cash payment | $ 1,380,000 | $ 1,240,000 |
Deferred revenue | $ 103,000 |
PROPERTY AND EQUIPMENT (Details
PROPERTY AND EQUIPMENT (Details) - USD ($) | Mar. 31, 2021 | Mar. 31, 2020 |
Property, Plant and Equipment [Abstract] | ||
Fixtures and fittings | $ 346,500 | $ 226,548 |
Less accumulated depreciation | (144,355) | (64,484) |
Property and equipment, net | $ 202,145 | $ 162,064 |
PROPERTY AND EQUIPMENT (Detai_2
PROPERTY AND EQUIPMENT (Details Narrative) - USD ($) | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation expense | $ 69,000 | $ 46,000 |
INTANGIBLE ASSETS (Details)
INTANGIBLE ASSETS (Details) - USD ($) | Mar. 31, 2021 | Mar. 31, 2020 |
Intangible Assets, Net (Including Goodwill) [Abstract] | ||
Patents and licenses | $ 516,935 | $ 307,009 |
Less accumulated amortization | (125,437) | (93,929) |
Intangible assets, gross | 391,498 | 213,080 |
Software development costs | 663,758 | 0 |
Intangible assets | $ 1,055,256 | $ 213,080 |
INTANGIBLE ASSETS (Details 1)
INTANGIBLE ASSETS (Details 1) - USD ($) | Mar. 31, 2021 | Mar. 31, 2020 |
Table Text Block Supplement [Abstract] | ||
2022 | $ 37,139 | |
2023 | 54,930 | |
2024 | 53,826 | |
2025 | 53,770 | |
2026 | 52,427 | |
Thereafter | 139,406 | |
Total future net intangible amortization expense | $ 391,498 | $ 213,080 |
INTANGIBLE ASSETS (Details Narr
INTANGIBLE ASSETS (Details Narrative) - USD ($) | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Intangible Assets, Net (Including Goodwill) [Abstract] | ||
Amortization expense related to intangible assets | $ 29,000 | $ 19,000 |
PREPAID EXPENSES (Details)
PREPAID EXPENSES (Details) - USD ($) | Mar. 31, 2021 | Mar. 31, 2020 |
Notes to Financial Statements | ||
Prepaid expenses | $ 592,695 | $ 351,755 |
Prepaid inventory | 587,493 | 0 |
Other taxes | 89,325 | 100,708 |
Prepaid expenses and other receivables | $ 1,269,513 | $ 452,463 |
NOTES PAYABLE (Details)
NOTES PAYABLE (Details) | Mar. 31, 2021USD ($) |
Debt Disclosure [Abstract] | |
2022 | $ 5,733,370 |
2023 | 19,188,724 |
Total | $ 24,922,094 |
NOTES PAYABLE (Details Narrativ
NOTES PAYABLE (Details Narrative) - USD ($) | Feb. 08, 2021 | Apr. 15, 2020 | Mar. 31, 2021 | Mar. 31, 2020 |
Proceeds from note payable | $ 25,000,000 | $ 0 | ||
Accretion | $ 2,007,687 | $ 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 | |||
Note Purchase Agreement 2 [Member] | Investor [Member] | Secured Note [Member] | ||||
Principal amount | $ 24,015,000 | |||
Original issue discount | 4,000,000 | |||
Purchase Price | 20,000,000 | |||
Commission expense | 1,200,000 | |||
Proceeds from note payable | $ 18,800,000 | |||
Term | 24 months | |||
Interest rate | 16.70% | |||
Monitoring fee, percentage | 0.833% | |||
Transaction expenses | $ 15,000 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) | 12 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | ||
Related Party Transactions [Abstract] | |||
Liability due to related parties at beginning of year | $ 830,093 | $ 964,679 | |
Amount invoiced by Pharma to DDL, NM and TCL | [1] | 2,441,108 | 1,800,517 |
Amounts invoiced by DDL to Pharma | (17,213) | (10,963) | |
Amounts repaid by DDL to Pharma | (3,209,084) | (1,897,222) | |
Foreign exchange differences | 103,891 | (26,918) | |
Liability due to related parties at end of year | $ 148,795 | $ 830,093 | |
[1] | These invoiced amounts primarily relate to research and development expenses. |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Income Tax Disclosure [Abstract] | ||
Loss before income taxes arising in UK | $ (5,030,204) | $ (2,470,107) |
Loss before income taxes arising in United States | (1,564,224) | (2,304,451) |
Total loss before income tax | $ (6,258,596) | $ (4,160,196) |
INCOME TAXES (Details 1)
INCOME TAXES (Details 1) - USD ($) | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Income Tax Disclosure [Abstract] | ||
Loss before income taxes | $ (6,594,428) | $ (4,774,558) |
Expected tax benefit | (1,384,830) | (1,003,000) |
Foreign tax differential | 100,604 | 0 |
Enhanced research and development | (259,861) | (231,000) |
Other | 20,226 | 125,000 |
Change in rate allowance | 0 | 119,000 |
Change in valuation allowance | 1,523,861 | 990,000 |
R&D credit received | 335,832 | 614,362 |
Actual income tax benefit | $ (335,832) | $ (614,362) |
Expected tax benefit | (21.00%) | (21.00%) |
Foreign tax differential | 2.00% | 0.00% |
Enhanced research and development | (4.00%) | (5.00%) |
Other | 0.00% | 2.00% |
Change in rate allowance | 0.00% | 2.00% |
Change in valuation allowance | 23.00% | 21.00% |
R&D credit received | 5.00% | 13.00% |
Income tax benefit | 5.00% | 13.00% |
INCOME TAXES (Details 2)
INCOME TAXES (Details 2) - USD ($) | Mar. 31, 2021 | Mar. 31, 2020 |
Income Tax Disclosure [Abstract] | ||
Net operating tax loss carried forwards | $ 5,204,000 | $ 3,926,000 |
Research and development enhancement | 1,057,000 | 797,000 |
Other items | (333,000) | (319,000) |
Valuation allowance | (5,928,000) | (4,404,000) |
Net deferred tax assets | $ 0 | $ 0 |
INCOME TAXES (Details Narrative
INCOME TAXES (Details Narrative) - USD ($) | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Income tax rate | 21.00% | 21.00% |
Research and development | $ 259,861 | $ 231,000 |
HMRC tax credit | $ 335,832 | |
UNITED STATES | ||
Income tax rate | 21.00% | 21.00% |
Net operating losses | $ 7,096,000 | |
UNITED KINGDOM | ||
Income tax rate | 19.00% | 19.00% |
Net operating losses | $ 19,546,000 | |
Research and development | 5,561,000 | |
Tax credits | $ 614,362 |
STOCKHOLDERS' EQUITY (Details N
STOCKHOLDERS' EQUITY (Details Narrative) - USD ($) | 1 Months Ended | 12 Months Ended | ||||
Jul. 30, 2020 | Jul. 28, 2020 | Dec. 20, 2018 | Dec. 18, 2018 | Mar. 31, 2021 | Mar. 31, 2020 | |
Reverse stock split | one (1) for ten (10) basis | |||||
Proceeds from common stock sold | $ 14,793,479 | |||||
Proceeds from warrants | $ 484,318 | |||||
Warrants exercised | 46,569 | |||||
Warrants outstanding | 147,637 | |||||
Warrants One [Member] | ||||||
Anti-dilutive common stock | 9,710 | 9,710 | ||||
Option [Member] | ||||||
Anti-dilutive common stock | 9,710 | 9,710 | ||||
Placement agent [Member] | ||||||
Proceeds from sale of common stock and warrants | $ 10,700,000 | |||||
Placement agency agreement | ||||||
Number of common stock sold | 194,206 | 240,000 | ||||
Public offering price | $ 10.40 | |||||
Sale of warrants | 194,206 | |||||
Proceeds from warrants | $ 2,019,743 | |||||
Proceeds from sale of common stock and warrants | 1,691,541 | |||||
Placement agent commissions | $ 328,302 | |||||
Warrants exercisable | $ 13 | |||||
Warrants term | 3 years | |||||
Placement agency agreement | Warrants One [Member] | ||||||
Anti-dilutive common stock | 9,710 | |||||
Placement agency agreement | Option [Member] | ||||||
Anti-dilutive common stock | 9,710 | |||||
Placement agency agreement | Kingswood [Member] | ||||||
Number of common stock sold | 1,586,206 | |||||
Proceeds from common stock sold | $ 11,500,000 | |||||
Proceeds from warrants | $ 6,000 | |||||
Warrants exercised | 750 | |||||
Warrants exercisable | $ 8 | |||||
Warrants outstanding | 792,353 | |||||
Distribution Agreement | ||||||
Number of common stock sold | 408,718 | 14,338 | ||||
Proceeds from common stock sold | $ 4,250,676 | $ 152,492 | ||||
Related cost | $ 127,520 | $ 40,365 |
OTHER ITEMS (Details Narrative)
OTHER ITEMS (Details Narrative) - USD ($) | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Stock compensation expense | $ 113,171 | $ 565,039 |
Insurance Policy Agreement [Member] | ||
Repayment of debt | $ 132,342 | |
Interest percentage rate | 13.90% | |
Insurance Policy Agreement 2 [Member] | ||
Repayment of debt | $ 123,451 | |
Interest percentage rate | 5.28% | |
Other liabilities and accrued expenses | $ 82,555 | |
Investor relations agreements [Member] | ||
Stock compensation expense | 50,000 | 17,888 |
Stock compensation expense paid | $ 59,000 | |
Cash fees expensed | $ 59,500 | |
Shares Issued | 16,250 | |
Share issued value | $ 116,461 | |
Management Consulting Agreement [Member] | ||
Stock compensation expense paid | 98,150 | |
Cash fees expensed | $ 186,176 |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - USD ($) | 3 Months Ended | 12 Months Ended | |
Jun. 28, 2021 | Mar. 31, 2021 | Mar. 31, 2020 | |
Proceeds from exercise of warrants | $ 400,503 | $ 26,000 | |
Subsequent Event [Member] | |||
Proceeds from exercise of warrants | $ 2,963,658 | ||
Number of warrants exercised | 366,892 | ||
Warrant exercise price | $ 8.08 |