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NBIO Nascent Biotech

Filed: 4 Nov 21, 4:10pm

 

U.S. SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

☒     QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended September 30, 2021

 

OR

 

☐     TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from ______________ to ______________

 

Commission File Number: 000-55299

 

NASCENT BIOTECH INC

(Exact Name of Registrant as Specified in Its Charter)

 

Nevada

 

46-5001940

(State of Incorporation)

 

(IRS Employer Identification No.)

 

 

 

623 17th Street Suite 4 Vero Beach, FL

 

32960

(Address of Principal Executive Offices)

 

(Zip Code)

 

(612) 961-5656

(Registrant’s Telephone Number)

 

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) been subject to such filing requirements for the past 90 days. Yes ☒    No ☐

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒     No ☐

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated file, non-accelerated filer, or a smaller reporting company.

 

Large accelerated filer

Accelerated filed

Non-accelerated filer

Smaller reporting company

 

 

Emerging Growth Company

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐    No ☒

 

As of November 4, 2021 the Registrant had 107,728,175 shares of common stock and no shares of Series A convertible preferred issued and outstanding.

 

 

 

 

TABLE OF CONTENTS

 

PART I – FINANCIAL INFORMATION

 

 

 

 

 

 

 

 

Item 1.

Financial Statement (Unaudited)

 

 

 

 

 

 

 

 

 

Unaudited Consolidated Balance Sheets as of September 30, 2021, and audited March 31, 2021

 

 

3

 

 

 

 

 

 

 

 

Unaudited Consolidated Statements of Operations for the Three and Six Months Ended September 30, 2021 and 2020

 

 

4

 

 

 

 

 

 

 

 

Unaudited Consolidated Statements of Stockholders’ Deficit for the Three and Six Months Ended September 30, 2021 and 2020

 

 

5

 

 

 

 

 

 

 

 

Unaudited Consolidated Statements of Cash Flows for the Six Months Ended September 30, 2021 and 2020

 

 

6

 

 

 

 

 

 

 

 

Notes to Unaudited Consolidated Financial Statements

 

 

7

 

 

 

 

 

 

 

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

 

16

 

 

 

 

 

 

 

Item 3.

Quantitative and Qualitative Disclosures About Market Risks

 

 

18

 

 

 

 

 

 

 

Item 4.

Controls and Procedures

 

 

18

 

 

 

 

 

 

 

PART II – OTHER INFORMATION

 

 

 

 

 

 

 

 

 

 

Item 1.

Legal Proceedings

 

 

19

 

 

 

 

 

 

 

Item 1A.

Risk Factors

 

 

19

 

 

 

 

 

 

 

Item 2.

Unregistered Sales of Equity and Use of Proceeds

 

 

19

 

 

 

 

 

 

 

Item 3.

Default upon Senior Securities

 

 

19

 

 

 

 

 

 

 

Item 4.

Mine Safety Information

 

 

19

 

 

 

 

 

 

 

Item 5.

Other Information

 

 

19

 

 

 

 

 

 

 

Item 6.

Exhibits

 

 

20

 

 

 

 

 

 

 

 

SIGNATURES

 

 

21

 

 

 

2

 

   

PART I – FINANCIAL INFORMATION

ITEM: 1 FINANCIAL STATEMENT

 

NASCENT BIOTECH, INC.

CONSOLIDATED BALANCE SHEETS

 

 

 

September 30,

2021

 

 

March 31,

2021

 

 

 

(Unaudited)

 

 

(Audited)

 

ASSETS

Current assets:

 

 

 

 

 

 

Cash

 

$102,386

 

 

$1,435

 

Accounts receivable

 

 

0

 

 

 

750,000

 

Prepaid

 

 

3,038

 

 

 

0

 

Total current assets

 

 

105,424

 

 

 

751,435

 

 

 

 

 

 

 

 

 

 

Total assets

 

$105,424

 

 

$751,435

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ DEFICIT

Current liabilities:

 

 

 

 

 

 

 

 

Accounts payable and accrued liabilities

 

$596,675

 

 

$636,831

 

Convertible note- net of discount

 

 

79,121

 

 

 

161,736

 

Derivative liability

 

 

152,941

 

 

 

302,156

 

Due to related parties

 

 

72,000

 

 

 

123,217

 

Deferred revenue

 

 

250,000

 

 

 

0

 

Total current liabilities

 

 

1,150,737

 

 

 

1,223,940

 

 

 

 

 

 

 

 

 

 

Total liabilities

 

 

1,150,737

 

 

 

1,223,940

 

 

 

 

 

 

 

 

 

 

Commitments and contingencies

 

 

0

 

 

 

0

 

 

 

 

 

 

 

 

 

 

Stockholders’ deficit:

 

 

 

 

 

 

 

 

Preferred stock, $0.001 par value, 50,000,000 authorized, none and 54,130 issued and outstanding, respectively

 

 

0

 

 

 

54

 

Common stock, $0.001 par value; 500,000,000 authorized, 107,728,175 and 104,834,083 issued and outstanding, respectively

 

 

107,728

 

 

 

104,834

 

Additional paid-in capital

 

 

17,859,481

 

 

 

17,774,023

 

Accumulated deficit

 

 

(19,012,522)

 

 

(18,351,416)

Total stockholders’ deficit

 

 

(1,045,313)

 

 

(472,505)

Total liabilities and stockholder’ deficit

 

$105,424

 

 

$751,435

 

 

The accompanying notes are an integral part of these unaudited consolidated financial statements.

 

 
3

Table of Contents

 

NASCENT BIOTECH, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

 

 

 

Three Months Ended September 30,

 

 

Six Months Ended September 30,

 

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Consulting

 

$118,000

 

 

$360,920

 

 

$280,813

 

 

$720,735

 

General and administrative expense

 

 

27,461

 

 

 

110,390

 

 

 

239,323

 

 

 

168,171

 

Research and development

 

 

84,777

 

 

 

89,693

 

 

 

152,911

 

 

 

223,445

 

Loss from operations

 

 

(230,238)

 

 

(561,003)

 

 

(673,047)

 

 

(1,112,351)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

 

4

 

 

 

0

 

 

 

10

 

 

 

3

 

Change in fair value

 

 

151,300

 

 

 

201,464

 

 

 

315,882

 

 

 

640,030

 

Gain on debt settlement

 

 

0

 

 

 

0

 

 

 

5,000

 

 

 

0

 

Financing costs

 

 

(35,000)

 

 

0

 

 

 

(101,150)

 

 

(3,000)

Original interest discount

 

 

(94,466)

 

 

0

 

 

 

(201,665)

 

 

0

 

Interest expense

 

 

(2,630)

 

 

(58,755)

 

 

(6,136)

 

 

(146,946)

Total other income (expense)

 

 

19,208

 

 

 

142,709

 

 

 

11,941

 

 

 

490,087

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

$(211,030)

 

$(418,294)

 

$(661,106)

 

$(622,265)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss per share, basic and diluted

 

$(0.00)

 

$(0.01)

 

$(0.01)

 

$(0.01)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average number of shares outstanding, basic and diluted

 

 

107,728,175

 

 

 

64,342,645

 

 

 

107,342,417

 

 

 

57,531,414

 

 

The accompanying notes are an integral part of these unaudited consolidated financial statements.

 

 
4

Table of Contents

 

NASCENT BIOTECH, INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ DEFICIT

THREE AND SIX MONTHS ENDED SEPTEMBER 30, 2021 AND 2020

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

Additional

 

 

 

 

 

Total

 

 

 

Preferred Shares

 

 

Common Stock

 

 

Paid-In

 

 

Accumulated

 

 

Stockholders’

 

 

 

Shares

 

 

Amount

 

 

Shares

 

 

Amount

 

 

Capital

 

 

Deficit

 

 

(Deficit)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at March 31, 2020

 

 

60,000

 

 

$60

 

 

 

44,890,262

 

 

$44,890

 

 

$13,916,995

 

 

$(16,837,649)

 

$(2,875,704)

Common stock issued for related parties for service

 

 

-

 

 

 

0

 

 

 

2,007,000

 

 

 

2,007

 

 

 

188,908

 

 

 

0

 

 

 

190,915

 

Common stock issued for AP- related parties

 

 

-

 

 

 

0

 

 

 

13,831,101

 

 

 

13,831

 

 

 

1,374,041

 

 

 

0

 

 

 

1,387,872

 

Common stock issued for AP settlement

 

 

-

 

 

 

0

 

 

 

35,715

 

 

 

36

 

 

4964

 

 

 

-

 

 

 

5,000

 

Common stock issued for service

 

-

 

 

 

-

 

 

 

677,000

 

 

 

677

 

 

 

84,763

 

 

 

-

 

 

 

85,440

 

Common stock issued for preferred shares

 

 

(60,000)

 

 

(60)

 

 

1,352,529

 

 

 

1,354

 

 

 

11,717

 

 

 

0

 

 

 

13,011

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

 

-

 

 

 

0

 

 

 

-

 

 

 

0

 

 

 

0

 

 

 

(203,971)

 

 

(203,971)

Balance at June 30, 2020

 

 

-

 

 

 

0

 

 

 

62,793,607

 

 

 

62,795

 

 

 

15,581,388

 

 

 

(17,041,620)

 

 

(1,397,437)

Preferred shares issued for cash

 

 

640,000

 

 

 

640

 

 

 

-

 

 

 

0

 

 

 

639,360

 

 

 

0

 

 

 

640,000

 

Preferred shares issued for debt

 

 

100,000

 

 

 

100

 

 

 

-

 

 

 

0

 

 

 

99,900

 

 

 

0

 

 

 

100,000

 

Common stock issued for service

 

 

-

 

 

 

0

 

 

 

728,572

 

 

 

728

 

 

 

43,423

 

 

 

0

 

 

 

44,151

 

Common stock issued for service-related parties

 

 

-

 

 

 

0

 

 

 

918,115

 

 

 

918

 

 

 

63,350

 

 

 

0

 

 

 

64,268

 

Common stock issued for convertible debt

 

 

-

 

 

 

0

 

 

 

2,677,397

 

 

 

1,677

 

 

 

147,323

 

 

 

0

 

 

 

150,000

 

Common stock issued for accounts payable

 

 

-

 

 

 

0

 

 

 

63,000

 

 

 

63

 

 

 

6,237

 

 

 

0

 

 

 

6,300

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

 

-

 

 

 

0

 

 

 

-

 

 

 

0

 

 

 

0

 

 

 

(418,294)

 

 

(418,294)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at September 30,2020

 

 

740,000

 

 

 

740

 

 

 

67,180,691

 

 

 

67,181

 

 

 

16,580,981

 

 

 

(17,495,914)

 

 

(811,012)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at March 31, 2021

 

 

54,130

 

 

$54

 

 

 

104,834,083

 

 

$104,834

 

 

$17,774,023

 

 

$(18,351,416)

 

$(472,505)

Common stock issued to related parties

 

 

-

 

 

 

0

 

 

 

568,719

 

 

 

569

 

 

 

59,147

 

 

 

0

 

 

 

59,716

 

Common stock issued for service

 

 

-

 

 

 

0

 

 

 

50,000

 

 

 

50

 

 

 

5,200

 

 

 

0

 

 

 

5,250

 

Common stock issued for AP – related parties

 

 

-

 

 

 

0

 

 

 

307,010

 

 

 

307

 

 

 

23,025

 

 

 

0

 

 

 

23,332

 

Common stock issued for preferred shares

 

 

(54,130)

 

 

(54)

 

 

1,968,363

 

 

 

1,968

 

 

 

(1914)

 

 

0

 

 

 

0

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

 

-

 

 

 

0

 

 

 

-

 

 

 

0

 

 

 

0

 

 

 

(450,076)

 

 

(450,076)

Balance at June 30, 2021

 

 

-

 

 

 

0

 

 

 

107,728,175

 

 

 

107,728

 

 

 

17,859,481

 

 

 

(18,801,492)

 

 

(834,283)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

 

-

 

 

 

0

 

 

 

-

 

 

 

0

 

 

 

0

 

 

 

(211,030)

 

 

(211,030)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at September 30, 2021

 

 

-

 

 

$0

 

 

 

107,728,175

 

 

$107,728

 

 

$17,859,481

 

 

$(19,012,522)

 

$(1,045,313)

 

The accompanying notes are an integral part of these consolidated financial statements.

 

 
5

Table of Contents

 

NASCENT BIOTECH, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

 

 

 

Six Months Ended September 30,

 

 

 

2021

 

 

2020

 

 

 

 

 

 

 

 

Cash flows from operating activities:

 

 

 

 

 

 

Net loss

 

$(661,106)

 

$(622,265)

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

 

 

 

 

 

Stock based compensation – related parties

 

 

59,716

 

 

 

354,309

 

Stock-based compensation

 

 

5,250

 

 

 

0

 

(Gain) loss in fair value of derivative liability

 

 

(315,883)

 

 

(640,030)

Debt discount expense

 

 

201,665

 

 

 

122,435

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

Accounts receivable

 

 

750,000

 

 

 

0

 

Accounts payable and accrued expenses

 

 

(37,267)

 

 

(112,375)

Deferred revenue

 

 

250,000

 

 

 

0

 

Prepaid

 

 

(3,038)

 

 

0

 

Due to related parties

 

 

(27,885)

 

 

274,265

 

Net cash provided by (used in) operating activities

 

$221,452

 

 

 

(594,020)

 

 

 

 

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

 

 

 

 

Proceeds from the sale of preferred shares for cash

 

 

0

 

 

 

640,000

 

Proceeds from convertible notes

 

 

200,000

 

 

 

0

 

Repayment of convertible notes

 

 

(320,500)

 

 

0

 

Proceeds from notes payable

 

 

0

 

 

 

50,000

 

Net cash provided (used) by financing activities

 

 

(120,500)

 

 

690,000

 

 

 

 

 

 

 

 

 

 

Net increase (decrease) in cash

 

 

100,952

 

 

 

95,960

 

Cash -beginning of year

 

 

1,435

 

 

 

3,218

 

Cash -end of period

 

$102,386

 

 

$99,198

 

 

 

 

 

 

 

 

 

 

SUPPLEMENT DISCLOSURES:

 

 

 

 

 

 

 

 

Interest paid

 

$20,055

 

 

$0

 

Income taxes paid

 

$0

 

 

$0

 

 

 

 

 

 

 

 

 

 

Non Cash Transactions

 

 

 

 

 

 

 

 

Common stock issued for conversion of preferred shares

 

$1,968

 

 

$13,011

 

Common stock issued for accrued expenses- related party

 

$23,332

 

 

$1,387,872

 

Common stock issued for accounts payable

 

$0

 

 

$11,300

 

Common stock issued for convertible debt

 

$0

 

 

$150,000

 

Common stock issued for notes payable

 

$0

 

 

$100,000

 

 

The accompanying notes are an integral part of these unaudited consolidated financial statements.

 

 
6

Table of Contents

 

NASCENT BIOTECH, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

 

NOTE 1 – ORGANIZATION AND NATURE OF OPERATIONS

 

Nascent Biotech, Inc. (“Nascent” or the “Company”) was incorporated on March 3, 2014, under the laws of the State of Nevada. The Company is actively developing Pritumumab for the treatment of brain cancer and pancreatic cancer. Nascent is also actively researching other cancers that have a high probability of benefiting from the therapeutic effects of Pritumumab because they share a common target. Pritumumab has shown to be very effective at low doses in previous clinical studies in Japan. Nascent is a Phase 1 clinical stage biopharmaceutical company that focuses on biologic drug candidates that are being clinical tested for the treatment of brain and pancreatic cancer.

 

On March 31, 2017, the Company filed its IND submission with the United States Food and Drug Administration (FDA) for clearance to begin Phase I clinical trials. On December 7, 2018, the Company received a letter from the FDA allowing it to use a specific lot of drug substance to begin phase 1 clinical trial. On March 15, 2021, the Company opened phase1 clinical trials. The trial is a dose escalation trial to determine toxicity levels of the drug with patients. As of September 30, 2021, the trials are on the second cohort of patients with the dose escalation of 4.8mg/kg.

 

NOTE 2 – BASIS OF PRESENTATION

 

The accompanying consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles. The Company has elected a fiscal year ending on March 31.

 

The accompanying unaudited interim consolidated financial statements of the Company for the six months ended September 30, 2020 and 2021 have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information in accordance with Securities and Exchange Commission and should be read in conjunction with the audited financial statements and notes thereto contained in the Company’s annual report on Form 10-K for the year ended March 31, 2021. In the opinion of management, the unaudited financial statements have been prepared on the same basis as the annual financial statements and reflect all adjustments, which include only normal recurring adjustments, necessary to present fairly the financial position and the results of operations for the interim periods presented herein. The results of operations for the interim periods are not necessarily indicative of the results to be expected for any subsequent quarters or for an entire year.

 

Recent Accounting Pronouncements

 

In February 2016, the FASB issued ASU No. 2016-02, Leases. The main provisions of ASU No. 2016-02 require management to recognize lease assets and lease liabilities for all leases. ASU 2016-02 retains a distinction between finance leases and operating leases. The classification criteria for distinguishing between finance leases and operating leases are substantially similar to the classification criteria for distinguishing between capital leases and operating leases in the previous release’s guidance. The result of retaining a distinction between finance leases and operating leases is that under the lessee accounting model, the effect of leases in the statement of comprehensive income and the statement of cash flows is largely unchanged from previous U.S. GAAP. The amendments in this ASU are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The adoption of this standard did not have a material impact on the Company’s consolidated financial statements and related disclosures.

 

 
7

Table of Contents

 

Basis of Presentation

 

The Company computes net loss per share in accordance with ASC 260, Earnings per Share, which requires presentation of both basic and diluted loss per share (“EPS”) on the face of the statement of operations. Basic EPS is computed by dividing net loss available to common shareholders (numerator) by the weighted average number of common shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period including stock options and warrants, using the treasury stock method, convertible preferred stock, and convertible debt, using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all potentially dilutive common shares if their effect is antidilutive.

 

We have identified the conversion features of certain of our convertible notes payable as derivatives. We estimate the fair value of the derivatives using the American Option Binomial Lattice pricing model. We estimate the fair value of the derivative liabilities at the inception of the financial instruments, at the date of conversions to equity and at each reporting date, recording a derivative liability, debt discount, and a gain or loss on change in derivative liabilities as applicable. These estimates are based on multiple inputs, including the market price of our stock, interest rates, our stock price volatility and variable conversion prices based on market prices as defined in the respective agreements. These inputs are subject to significant changes from period to period and to management's judgment; therefore, the estimated fair value of the derivative liabilities will fluctuate from period to period, and the fluctuation may be material.

 

Reclassification

 

Certain prior period amounts were reclassified to conform to the manner of presentation in the current period. These reclassifications had no effect on the net loss or stockholders deficit.

 

Revenue Recognition

 

In April 2016, the FASB issued ASU 2016–10 Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing. The amendments in this Update do not change the core principle of the guidance in Topic 606. Rather, the amendments in this Update clarify the following two aspects of Topic 606: identifying performance obligations and the licensing implementation guidance, while retaining the related principles for those areas. Topic 606 includes implementation guidance on (a) contracts with customers to transfer goods and services in exchange for consideration and (b) determining whether an entity’s promise to grant a license provides a customer with either a right to use the entity’s intellectual property (which is satisfied at a point in time) or a right to access the entity’s intellectual property (which is satisfied over time). The amendments are intended to render more detailed implementation guidance with the expectation to reduce the degree of judgement necessary to comply with Topic 606.

 

ASC Topic 606 prescribes a new five-step model entities should follow in order to recognize revenue in accordance with the core principle. These five steps are:

 

 

1.

Identify the contract(s) with a customer.

 

2.

Identify the performance obligations in the contract.

 

3.

Determine the transaction price.

 

4.

Allocate the transaction price to the performance obligations in the contract.

 

5.

Recognize revenue when (or as) the entity satisfied the performance obligations.

    

The Company implemented the transition using the modified retrospective method of transition. The funds are not earned on milestones that have not been reached per the contract. Based on the cut off treatment of the recognition of revenue per the milestones specific to the license agreements, the Company has determined that there are no adjustments in the value of the revenue recognized from these contracts.

 

The Company has one revenue stream, which is the milestone payments of the license agreement with BioRay Pharmaceutical which is not earned or billed until the milestone per the agreement is met.

 

 
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Accounts Receivable

 

Accounts receivables are carried at face value less any provisions for uncollectible amounts. Accounts receivable are receivables from a license agreement. No allowance for bad debt was considered necessary for the three and six months ended September 30, 2021, and 2020, respectively.

 

Fair Value of Financial Instruments

 

The Company’s financial instruments consist of cash and cash equivalents, accounts payable and accrued expenses and shareholder loans. The carrying amount of these financial instruments approximates fair value due either to length of maturity or interest rates that approximate prevailing market rates unless otherwise disclosed in these financial statements.

 

Financial assets and liabilities recorded at fair value in our condensed consolidated balance sheets are categorized based upon a fair value hierarchy established by GAAP, which prioritizes the inputs used to measure fair value into the following levels:

 

Level 1 – Quoted market prices in active markets for identical assets or liabilities at the measurement date.

 

Level 2 – Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable and can be corroborated by observable market data.

 

Level 3 – Inputs reflecting management’s best estimates and assumptions of what market participants would use in pricing assets or liabilities at the measurement date. The inputs are unobservable in the market and significant to the valuation of the instruments.

 

A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement.

 

NOTE 3 – GOING CONCERN

 

The Company’s consolidated financial statements are prepared using accounting principles generally accepted in the United States of America applicable to a going concern that contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has a working capital deficit and has incurred losses from operations. The Company has received limited revenue through the sale of a license agreement to cover its operating costs and the Company will incur additional expenses in the future developing their product. These factors raise substantial doubt about the company’s ability to continue as a going concern. The Company engages in research and development activities that must be satisfied in cash secured through outside funding. The Company may offer noncash consideration and seek equity lines as a means of financing its operations. If the Company is unable to obtain revenue producing contracts or financing or if the revenue or financing it does obtain is insufficient to cover any operating losses it may incur, it may substantially curtail or terminate its operations or seek other business opportunities through strategic alliances, acquisitions or other arrangements that may dilute the interests of existing stockholders. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

 

NOTE 4 – RELATED PARTY TRANSACTIONS

 

On September 1, 2015, the Company entered five-year employment contracts with three of its officers and directors. One of the officers and director resigned as of September 30, 2020. Under the terms of the agreements the Company issued shares of common stock to the officers and directors equaling 11% of the outstanding shares of the Company as of the date of the contracts. As additional future shares are issued, the officers and directors are entitled to additional shares, so their aggregate ownership percentage remains at 11% of the outstanding shares of the Company. The following table sets forth the shares earned under these contracts for the two active officers as of September 30, 2021:

 

 
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Officer and Director

 

Initial Share

Awards Under

the Contracts

 

 

Additional Shares Earned to

Maintain

Ownership Percentage

 

 

Total Shares

Earned

 

President

 

 

1,028,910

 

 

 

7,177,269

 

 

 

8,206,179

 

Chief Financial Officer

 

 

617,346

 

 

 

3,821,223

 

 

 

4,438,569

 

Total

 

 

1,646,256

 

 

 

10,998,492

 

 

 

12,644,748

 

 

As of September 30, 2021, the Company had $72,000due to officers and directors.

 

On September 1, 2020, the Company entered five-year compensation agreements with two of its officers and directors. Under the terms of the agreements the Company issued shares of common stock to the officers and directors equaling 18% of the outstanding shares of the Company as additional future shares are issued. The officers and directors are entitled to additional future shares, so their aggregate ownership percentage remains at 18% of the future outstanding shares of the Company.

 

Officer and Director

 

Fiscal Year Annualized Compensation

Being Paid

 

President

 

$250,000

 

Chief Financial Officer

 

$180,000

 

Total

 

$430,000

 

 

During the six months ended September 30, 2020, four officers and directors were issued 2,925,115 shares of common stock with a value of $247,655 for service.

 

During the six months period ended September 30, 2020, three officers of the Company converted $1,387,872 of accrued compensation into 13,831,101 shares of common stock of the Company.

 

During the six months ended September 30, 2020, the Company issued 1,352,529 shares of common stock for the conversion of 60,000 shares of preferred stock.

 

During the six months ended September 30, 2021, three officers and directors were issued 568,719 shares of common stock with a value of $59,716 for service.

 

During the six months period ended September 30, 2021, a director of the Company converted $23,332 of accrued compensation into 307,010 shares of common stock of the Company.

 

During the six months period ended September 30, 2021, the Company issued 50,000 shares of common stock with a value of $5,250 for service.

 

During the six months period ended September 30, 2021, 54,130 shares of preferred stock were converted into 1,968,363 shares of common stock. The conversion eliminated all outstanding convertible preferred shares.

 

 
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NOTE 5 – EQUITY

 

Preferred

 

On July 25, 2019, the Company issued 110,000 shares of series A convertible preferred to one entity with a value of $110,000 for cash. Each share of series A preferred is convertible after 180 days to four shares of common stock or at the lowest of: (i) the fixed conversion price; (ii) the equitant of 70% of the lowest closing price for the 20 days prior to the conversion of the preferred shares plus 7% per annum interest.

 

During the six months period ended September 30, 2020, the Company issued 740,000 shares of Series A preferred stock and 3,700,000 warrants: 640,000 for $640,000 in cash and $100,000 for debt. The stock is convertible into common stock at 10 cents per share or 50% of the lowest trading price, whichever is lower 5 days prior to conversion. The Company has the right to convert the shares nine months after the issuance. The warrants are convertible at $0.15 per share within two years of issuance. In addition, the Company agreed to filing an S-1 for the common stock to be converted and the underlying common shares for the warrants.

 

During the six months ended September 30, 2020, the Company issued 1,352,529 shares of common stock for the conversion of 60,000 shares of preferred stock.

 

On April 1, 2021, 54,130 shares of preferred stock were converted into 1,968,363 shares of common stock. The conversion eliminated all outstanding convertible preferred shares.

 

Common

 

During the six months ended September 30, 2020, the Company issued 98,715 shares of common stock with a value of $10,875 for settlement of accounts payable.

 

During the Six months ended September 30, 2020, the Company issued 1,405,572 shares of common stock with a value of $136,245 for service.

 

During the six months ended September 30, 2020, the Company issued 1,352,529 shares of common stock for the conversion of 60,000 shares of preferred stock.

 

During the six months ended September 30, 2020, three officers and a director were issued 2,925,115 shares of common stock with a value of $247,655 for service.

 

During the six months ended September 30, 2020, the Company issued 2,677,397 shares of common stock for the conversion of $150,000 of convertible debt.

 

During the six months period ended September 30, 2020, three officers of the Company converted $1,387,872 of accrued compensation into 13,831,101 shares of common stock of the Company.

 

During the six0months ended September 30, 2021, three officers and directors were issued 568,719 shares of common stock with a value of $59,716 for service.

 

During the six months period ended September 30, 2021, a director of the Company converted $23,332 of accrued compensation into 307,010 shares of common stock of the Company.

 

During the six months ended September 30, 2021, the Company issued 50,000 shares of common stock with a value of $5,250 for service.

 

 
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NOTE 6 – OPTIONS

 

As of September 30, 2021, there was no option expenses recognized by the Company and the balance of unrecognized option expense was zero. In addition 475,000 options expired for the resignation of an officer and director plus the termination of consultants holding options that were not converted in the required time period after termination.

 

The following sets forth the options granted and outstanding during the six months ended September 30, 2021:

 

 

 

 

 

 

Weighted

Average

 

 

Weighted

Average

Remaining

 

 

Number of

 

 

 

 

 

Options

 

 

Exercise

Price

 

 

Contract

Life

 

 

Options

Exercisable

 

 

Intrinsic

Value

 

Outstanding at March 31, 2021

 

 

1,405,000

 

 

$0.34

 

 

 

4.80

 

 

 

1,405,000

 

 

$0

 

Granted

 

 

-

 

 

 

--

 

 

 

0

 

 

 

-

 

 

 

0

 

Exercised

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expired

 

 

(475,000)

 

 

--

 

 

 

0

 

 

 

(475,000)

 

 

0

 

Outstanding at September 30, 2021

 

 

930,000

 

 

$0.379

 

 

 

4.30

 

 

 

930,000

 

 

$0

 

 

The weighted average remaining life and intrinsic value of the options as of September 30, 2021, was 4.30 years and zero, respectively.

 

NOTE 7 – WARRANTS

 

During the year ended March 31, 2021, the Company granted 3,700,000 warrants to four entities as part of the issuance of 740,000 Series A convertible preferred shares. The warrants expire in two years from grant date and are convertible into common stock at $0.15 per share. The warrants contain an anti-dilution clause which become effective if any instrument is issued after the warrant issuance is converted into common stock at a price lower than the warrant conversion price.

 

The Company used the Black Scholes Pricing model to estimate the fair value of the warrants as of grant date, using the following key inputs: market prices of the Company’s common stock at dates of grant between $0.08-0.11 per share, conversion price of $0.15, volatility of 312.5%-314.49% and discount rate of 0.14-0.16%. Based on the fair value of the common stock of $437,000 and value of the warrants of $349,605 the fair value of the warrants was calculated to be 41% of the total value or $303,000. During the year ended March 31, 2021, the valuation resulted in a deemed dividend from the down round calculation of $555,000.

 

The weighted average remaining life and intrinsic value of the warrants as of September 30, 2021, was:

 

 

 

Warrants

 

 

Weighted

Average

Exercise

Price

 

 

Weighted

Average

Remaining

Contract Life

 

 

Intrinsic

Value

 

Outstanding at March 31, 2020

 

 

-

 

 

$0.00

 

 

 

0.00

 

 

$0

 

Granted

 

 

3,700,000

 

 

 

0.15

 

 

 

2.00

 

 

 

 

 

Exercised

 

 

-

 

 

 

0

 

 

 

--

 

 

 

0

 

Expired

 

 

-

 

 

 

0

 

 

 

--

 

 

 

0

 

Outstanding at March 31, 2021

 

 

3,700,000

 

 

$0.04

 

 

 

1.35

 

 

$0

 

Granted

 

 

-

 

 

 

0

 

 

 

--

 

 

 

0

 

Exercised

 

 

-

 

 

 

0

 

 

 

--

 

 

 

0

 

Expired

 

 

-

 

 

 

0

 

 

 

--

 

 

 

0

 

Outstanding as of September 30, 2021

 

 

3,700,000

 

 

$0.04

 

 

 

0.85

 

 

$0

 

 

 
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NOTE 8 – CONVERTIBLE DEBT

 

On May 7, 2020, the Company issued an 8% $50,000 one year convertible note. The note is convertible into common stock at the lesser of $0.20 per share or 80% of the lowest closing bid five days prior to conversion.

 

On July 7, 2020, $50,000 of the one-year convertible note payable was converted into 50,000 shares of series A preferred shares.

 

On October 28, 2020, the Company issued a $138,000convertible note with an OID of $10,000. The note matures on October 28,2021 and bears interest at 10% per annum. After 180 days the note may be converted into common stock of the Company at $0.04 per share or a 30% discount to the VWAP during the 20 days prior to conversion. The initial derivative was calculated using risk free interest of .18%, volatility of 212% and expected life of .50 years. On April 20, 2021, note was paid with the principal of $138,000, accrued interest of $6,805 and financing costs of $41,400.

 

On November 11, 2020, the Company issued a $82,500 convertible note with an OID of $7,500. The note matures on October 28,2021 with a fixed interest of 10%. After 180 days the note may be converted into common stock of the Company at a 35% discount to the lowest trading price during the 20 days prior to conversion. On April 22, 2021, the note was paid consisting of principal of $82,500, accrued interest of $8,250 and finance costs of $24,750.

 

On February 16, 2021, the Company issued a $100,000 convertible note with an OID of $5,000. The note matures on February 16, 2022, and bears fixed interest of 10%. After 180 days the note may be converted into common stock of the Company at a 30% discount to the lowest trading price during the 15 days prior to conversion. The initial derivative was calculated using risk free interest of .18%, volatility of 213% and expected life of 1.00 years. On August 16, 2021, the note was paid consisting of principal of $100,000, accrued interest of $5,000 and financing costs off $35,000.

 

On August 10, 2021, the Company issued a $200,000 convertible note. The note matures on February 10, 2022, and bears fixed interest of 10%. Within 180 days of issuance the note may be repaid at an escalating premium up to 125% of the face value of the note. After 180 days the note may be converted into common stock of the Company at $0.06 per share or a 25% discount to the lowest trading price during the 10 days prior to conversion. The initial derivative was calculated using risk free interest of .05%, volatility of 132% and expected life of 0.50 years. As of September 30, 2021 the derivative was calculated using risk free interest of 0.05%, volatility of 111% and expected life of .35. The outstanding balance due as of September 30, 2021 was $200,000 principal and interest accrued of $2,630.

   

NOTE 9 – FAIR VALUE MEASUREMENTS AND DERIVATIVE LIABILITIES

 

As defined in (Financial Accounting Standards Board ASC 820), fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The Company utilized the market data of similar entities in its industry or assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated, or generally unobservable. The Company classifies fair value balances based on the observability of those inputs. FASB ASC 820 establishes a fair value hierarchy that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurement) and the lowest priority to unobservable inputs (level 3 measurement).

 

 
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The three levels of the fair value hierarchy are as follows:

 

Level – 1

Quoted prices are available in active markets for identical assets or liabilities as of the reporting date. Active markets are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis. Level 1 primarily consists of financial instruments such as exchange-traded derivatives, marketable securities, and listed equities.

 

 

 

Level – 2

Pricing inputs are other than quoted prices in active markets included in level 1, which are either directly or indirectly observable as of the reported date and includes those financial instruments that are valued using models or other valuation methodologies. These models are primarily industry-standard models that consider various assumptions, including quoted forward prices for commodities, time value, volatility factors, and current market and contractual prices for the underlying instruments, as well as other relevant economic measures. Substantially all of these assumptions are observable in the marketplace throughout the full term of the instrument, can be derived from observable data or are supported by observable levels at which transactions are executed in the marketplace. Instruments in this category generally include non-exchange-traded derivatives such as commodity swaps, interest rate swaps, options, and collars.

 

 

 

Level – 3

Pricing inputs include significant inputs that are generally less observable from objective sources. These inputs may be used with internally developed methodologies that result in management’s best estimate of fair value

 

As September 30, 2021, the Company believes the amounts reported for cash, payables, accrued liabilities and amounts due to related parties approximate their fair values due to the nature or duration of these instruments.

 

The following table represents the change in the fair value of the derivative liabilities during the six months ended September 30, 2021:

 

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

Fair value of derivative liability as of March 31, 2021

 

$0

 

 

$0

 

 

$302,156

 

Additions at fair value

 

 

 

 

 

 

 

 

 

 

166,667

 

Change in fair value of the derivative

 

 

0

 

 

 

0

 

 

 

(315,882)

 

 

 

--

 

 

 

--

 

 

 

 

 

Balance at September 30, 2021

 

$0

 

 

$0

 

 

$152,941

 

 

The estimated fair value of the derivative liabilities at September 30, 2021 was calculated using the Binomial Lattice pricing model with the following assumptions:

 

Risk-free interest rate

 

 

.05%

Expected life in years

 

 

0.35

 

Dividend yield

 

 

0%

Expected volatility

 

 

111.00%

 

 
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NOTE 10 – COMMITMENTS AND CONTINGENCIES

 

On September 30, 2016, the Company entered a cell line sales agreement with the product manufacturer. Under the terms of the agreement the Company is obligated to make future payments based on the milestones of its achievements. These future payments may be as followed:

 

 

1.

$100,000 upon the initiation (first dose/first patient) of the first Phase I clinical trial (or equivalent) of a Product.

 

2.

$225,000 upon the initiation (first dose/first patient) of the first Phase III clinical trial (or equivalent) of a Product.

 

3.

$225,000payable upon the first Biologics License Application approval (or equivalent) of a Product.

 

4.

Annual maintenance fee upon completion of phase I manufacturing or the transfer of the cell line from Catalent’s control of $50,000.

 

5.

A contingent sales fee upon first commercial sale of a product of 1% of sales or $150,000 whichever is greater payable quarterly.

   

On June 29, 2021, the Company paid $25,000 of the outstanding balance. As of September 30, 2021, $299,960 was due for the annual maintenance fee, first patient dosage of phase 1 plus interest.

 

On March 9, 2020, the Board of Directors of the Company adopted an expense bonus program. Under the program, if an acquisition, merger or change in control is affected, 10% of the value of the transaction will be allocated to pay the expenses of the transaction including but not limited to legal, accounting, transfer fees and other miscellaneous expense. The balance of the fund after expenses will be allocated 20% to directors and 80% to officers and employees of the Company as allocated by the Chief Executive Officer and approved by the Board of Directors.

 

NOTE 11 – LICENSE AGREEMENT

 

On March 31, 2021, the Company issued a license agreement for US $5,000,000 to BioRay Pharmaceutical Co, LTD, licensing Pritumumab internationally with the exclusion of North and Central America and the Caribbean Islands. Under the terms of the agreement the Company receives $250,000 upon signing of the agreement plus $750,000 with the start of the phase 1 clinical trials, which started in March 2021. In addition, the Company will receive $750,000 upon the enrollment of the 12th patient or the dosage level of 8.0 mg/kg, whichever is achieved first. Further payment of $2,500,000 will be received when the FDA approves the phase 2 clinical trials and $750,000 when the phase 2 clinical trials begin. Upon commercialization by the Licensee, the Company will receive a 9% royalty on net sales for 20 years.

 

NOTE 12 – SUBSEQUENT EVENTS

 

On October 29, 2021 the Company filed patent application PCT/US2021/057313 Kits and containers for treating Vimentin and Expressing Tumors. The application was filed under the PCT international rules as placeholder for  applications in various countries

 

The Company has evaluated subsequent events to determine events occurring after September 30, 2021, through November 4, 2021 that would have a material impact on the Company’s financial results or require disclosure and have determined none exist other than those noted above in this footnote.

  

 
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ITEM 2: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERTIONS

 

This report contains forward looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. The Company’s actual results could differ materially from those set forth on the forward-looking statements because of the risks set forth in our filings with the Securities and Exchange Commission, general economic conditions, and changes in the assumptions used in making such forward looking statements.

 

Nascent Biotech, Inc (“Nascent” or the “Company”) was incorporated on March 3, 2014, under the laws of the State of Nevada. The Company is actively developing Pritumumab for the treatment of brain cancer and pancreatic cancer. Nascent is also actively researching other cancers that have a high probability of benefiting from the therapeutic effects of Pritumumab because they share a common target. Pritumumab has shown to be very effective at low doses in previous clinical studies in Japan.

 

Nascent is a phase 1 clinical stage biopharmaceutical company that develops monoclonal antibodies for the treatment of various forms of cancer. The Company focuses on biologic drug candidates that are undergoing or have already completed initial clinical testing for the treatment of cancer and then seek to further develop those drug candidates for commercial use. Nascent currently is developing for the treatment of brain cancer and pancreatic cancer both of which we hold orphan drug status granted by the FDA.

 

In addition, Nascent has begun, in collaboration with academic and corporate partners, to assess the potential for pritumumab to be involved as both a treatment and a vaccine for the SARS-CoV-2 virus (responsible for COVID-19).

 

Overview

 

The Company is focused on developing pritumumab for the treatment of patients with brain cancer malignancies such as gliomas and astrocytomas. Current therapeutic strategies for brain cancer include the use of the chemotherapy, surgical intervention or radiation therapy. Because these treatments have marginal outcomes there exists a need to develop safer, more effective drugs. Temodar-the most commonly used Chemotherapeutic drug used to treat brain cancer, is attributed to only median rates of survival and many brain tumors are eligible for surgery. Moreover, even when removed, most brain tumors come back within one-year post-operation. Today, with current standards of care, less than 60% of all brain cancer patients will live past the first year after diagnosis, and less than 35% of patients will live to five years. Glioblastoma, a particularly aggressive form of brain cancer that constitutes 42% of ALL brain and other nervous system cancers, has survival rates of 36.5% at 1 year and 5% at 5 years. (SEER Registry Data, September 15th, 2016 (Central Brain Tumor Registry of the United States).

 

On March 31, 2017, the Company filed its IND submission with the United States Food and Drug Administration (FDA) for clearance to begin Phase I clinical trials. On December 7, 2018, the Company received a letter from the FDA allowing it to use a specific lot of drug substance to begin phase 1 clinical trial. The Company has commenced human clinical trials with a major oncology hospital for brain cancer, both primary and metastatic. The Company has enrolled the second cohort of patients in the dose escalation trial for determining toxicity of the drug.

 

As of September 30, 2021 the Company has enrolled its initial patient in the second cohort of patients in its dose escalation study.

 

 
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In May of 2020, Nascent announced a research collaboration to study, both in vitro and in vivo (mouse models), the ability of pritumumab to block the SARS-Cov-2 virus from infecting cells. This notion has been raised by a published article in the scientific literature (Yu et al. Journal of Biomedical Science (2016) 23:14 DOI 10.1186/s12929-016-0234-7), which specifically mentioned cell surface vimentin (the protein to which pritumumab binds selectively) as a potential target in the treatment of conditions related to coronaviruses. These preliminary studies are on-going. Further, in May of 2020, Nascent announced a joint collaboration with Manhattan BioSolutions, Inc (NY, NY) to employ Manhattan’s platform, based on the recombinant Mycobacterium bovis Bacillus Calmette-Guerin (BCG) vaccine, but engineered to target SARS-CoV-2. BCG is a live non-pathogenic bacterium that stimulates diverse innate and adaptive immune responses and is well-known for its long safety track record as a tuberculosis vaccine. Thus, with these collaborations, Nascent is investigating the potential utility of pritumumab as both a treatment for COVID-19 and a preventive vaccine for COVID-19.

 

Results of Operations

 

The Company recorded zero of revenue during the three and six month periods ended September 30, 2021 and 2020, respectively.

 

Operating expenses for the three and six month periods ended September 30, 2021 was $230,238 and $673,047 compared to $561,003 and $1,112,351 in 2020. Consulting expense for the three and six months periods ending September 30,2021 was $118,000 and $280,813 compared to $360,920 and $720,735 for the same period in 2020. This decrease in expenses for the three and six months ended September 30, 2021 over the same period in 2020 was due primarily to an annual license fee and dosing fees of $150,000 higher consulting costs in 2020 over 2021 for the same periods.

 

Research and development expenses for the three and six month periods ended September 30, 2021 was $84,777 and $152,911 compared to $89,693 and $223,445 in the same periods in 2020. This decrease in expenses for the three and six months ended September 30, 2021 over the same period in 2020 reflected decreased testing required in the filing of the IND with the FDA.

 

Total other income and expense incurred in the three and six month periods ended September 30, 2021 was income of $19,208 and $11,940, compared to other income of $142,709 and $490,086 in the same period in 2020. Other expense in 2021 consisted of a gain on the change of fair value of $315,882 offset by interest expense of $6,136 discount interest of $201,665 and finance costs of $101,150 plus a gain on debt settlement of $5,000 from paying off convertible notes.

 

For the three and six month periods ended September 30, 2021, our net loss was $211,030 and $661,106 compared to a net loss of $418,294 and $622,265 for the same periods in 2020. The difference between the periods relates to other income in 2021 compared to other income in 2020 which relates primary to changes in fair value and financing cost and interest discounts.

 

Liquidity and Capital Resources

 

The Company’s liquidity and capital is dependent on the capital it can raise to continue the Company’s testing and clinical trials of its product. The Company projects it must raise approximately $10-15 million to complete its Phase II clinical studies.

 

There are no agreements or understandings about future loans by or with the officers, directors, principals, affiliates, or shareholders of the Company. The Company will continue to raise outside capital through loans, equity sales and possible licensing agreements. These factors raise substantial doubt about the company’s ability to continue as a going concern

 

At September 30, 2021, the Company’s negative working capital of $1,045,313. Current assets consist of cash of $102,386 and prepaid of $3,038 with current liabilities $1,150,737 consisting of accounts payable of $596,675, convertible notes, net of discount of $79,121, deferred revenue of $250,000 plus derivative liability of $152,941 and due related parties of $72,000.

 

 
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Net cash provided by operating activities in the six months period ended September 30, 2021 was $221,452 compared to net cash used of $594,020 in the same period in 2020. The variance between the same periods in 2021 and 2020 relates mainly accounts receivable collection of $750,000 for the six months period ended September 30, 2021.

 

Net cash used in financing activities for the six months period ended September 30, 2021 was $120,500 compared to net cash provided by financing activities of $690,000 in the same period in 2020. Cash used was a function of the repayment of three convertible notes totaling $320,500 in the six months period ended September 30, 2021 offset by proceed from a convertible note of $200,000.

 

As of September 30, 2021, the Company had total assets of $105,424 and total liabilities of $1,150,737. Stockholders’ deficit as of September 30, 2021 was $1,045,313. This compares to a stockholders’ deficit of $472,505 as of March 31, 2021. Liabilities minimal decrease in 2021 mainly due to the conversion of related party accrued compensation into common stock, lower derivative liability offset by deferred revenue of $250,000 and lower account payable verses March 31, 2021.

    

NEED FOR ADDITIONAL FINANCING:

 

Our current capital needs are estimated to be approximately $10-15 million. This will take us through Phase II clinical trials which is scheduled to begin in 2022 subject to the completion of phase 1 and FDA approval to proceed to phase 2.

 

Off-Balance Sheet Arrangements

 

We had no off-balance sheet arrangements or guarantees of third party obligations at September 30, 2021.

 

Inflation

 

We believe that inflation has not had a significant impact on our operations since inception.

 

ITEM 3: QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

 

Not applicable.

 

ITEM 4: CONTROLS AND PROCEDURES

 

Under the supervision and the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation as of September 30, 2021, of the effectiveness of the design and operation of our disclosure controls and procedures, as such term is defined under Rule 13a-15(e) promulgated under the Securities Exchange Act of 1934, as amended. Based on this evaluation, our principal executive officer and our principal financial officer concluded that our disclosure controls and procedures were not effective as of September 30, 2021 Such conclusion reflects the identification of material weakness as follows: (1) lack of accounting proficiency of our chief executive officer who is our sole officer and our principal accounting officer which has resulted in a reliance on part-time outside consultants to perform substantially all of our accounting functions, (2) a lack of adequate segregation of duties and necessary corporate accounting resources in our financial reporting process and accounting function, and (3) lack of control procedures that include multiple levels of review. Until we can remedy these material weaknesses, we have engaged third party consultants and accounting firm to assist with financial reporting.

 

Changes in Internal Control over Financial Reporting

 

There have been no changes in our internal control over financial reporting that occurred during the six months ended September 30, 2021 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

 
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PART II – OTHER INFORMATION

 

ITEM 1: LEGAL PROCEEDINGS

 

None.

 

ITEM 1A: RISK FACTORS

 

There have been no material changes to Nascent Biotech’s risk factors as previously disclosed in our most recent Form 10-K filing.

 

ITEM 2: UNREGISERED SALES OF EQUITY AND USE OF PROCEEDS.

 

During the six months ended September 30, 2021, three officers and directors were issued 568,719 shares of common stock with a value of $59,716 for service.

 

During the six months period ended September 30, 2021, a director of the Company converted $23,332 of accrued compensation into 307,010 shares of common stock of the Company.

 

During the six months period ended September 30, 2021, the Company issued 50,000 shares of common stock with a value of $5,250 for service.

 

During the six months period ended September 30, 2021, 54,130 shares of preferred stock were converted into 1,968,363 shares of common stock. The conversion eliminated all outstanding convertible preferred shares.

 

ITEM 3: DEFAULT ON SENIOR SECURITIES

 

None.

 

ITEM 4: MINE SAFETY INFORMATION

 

None.

 

ITEM 5: OTHER INFORMATION

 

None.

 

 
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ITEM 6: EXHIBITS

 

Exhibit No.

 

Description

 

 

 

31

 

Certification of Principal Executive Officer and CFO pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

 

 

 

32

 

Certification of Principal Executive Officer and CFO Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

 

 

 

101.INS

 

Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document).

 

 

 

101.SCH

 

Inline XBRL Taxonomy Extension Schema Document.

 

 

 

101.CAL

 

Inline XBRL Taxonomy Extension Calculation Linkbase Document.

 

 

 

101.DEF

 

Inline XBRL Taxonomy Extension Definition Linkbase Document.

 

 

 

101.LAB

 

Inline XBRL Taxonomy Extension Labels Linkbase Document.

 

 

 

101.PRE

 

Inline XBRL Taxonomy Extension Presentation Linkbase Document.

 

 

 

104

 

Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101).

 

 
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SIGNATURE

 

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

 

NASCENT BIOTECH, INC.

    
Dated: November 4, 2021By:/s/ Sean Carrick

 

 

Sean Carrick

 
  

Principal Executive Officer

 

 

 
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