U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended December 31, 1999
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 000-27353
SELECT THERAPEUTICS, INC.
(Exact name of small business issuer as specified in its charter)
Delaware 98-0169105
State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
124 Mt. Auburn St., Suite 200 North, Cambridge, MA 02138
(Address of principal executive offices) (Zip Code)
(617) 520-6693
(Issuer's telephone number, including area code)
N/A
(Former name, former address and former fiscal year, if
changed since last report)
Check whether the Issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes ___ No _X_
The aggregate number of shares outstanding of the Issuer's Common Stock, its
sole class of common equity, was 6,101,358 as of February 3, 2000.
Transitional Small Business Issuer Disclosure Format: Yes ___ No _X_
Page 1 of 15; Exhibit Index is on Page 13
<PAGE>
SELECT THERAPEUTICS INC.
(A DEVELOPMENT STAGE ENTERPRISE)
Consolidated Balance Sheets
(Stated in U.S. dollars)
(Unaudited)
<TABLE>
<CAPTION>
==================================================================================
December 31, June 30,
1999 1999
(Audited)
- ----------------------------------------------------------------------------------
<S> <C> <C>
Assets
Cash and cash equivalents $ 66,921 $ 120,881
Restricted cash 304,200 72,000
Accounts receivable -- 7,380
Inventory 33,893 32,130
Prepaid expenses and other assets 18,380 21,740
Property, plant and equipment 118,584 104,547
Intangible assets 770,706 900,581
- ----------------------------------------------------------------------------------
$ 1,312,684 $ 1,259,259
==================================================================================
Liabilities and Shareholders' Equity
Liabilities:
Accounts payable $ 109,914 $ 43,309
Accrued liabilities 687,683 655,798
- ----------------------------------------------------------------------------------
797,597 699,107
Shareholders' equity:
Capital stock:
Authorized:
1,000,000 preferred shares
10,000,000 common shares,
$0.001 par value
Issued:
6,668,358 common shares
(June 30, 1999 - 5,634,094) 6,668 5,634
Contributed surplus 6,211,636 5,140,120
Deficit accumulated during the development stage (5,703,217) (4,585,602)
- ----------------------------------------------------------------------------------
515,087 560,152
- ----------------------------------------------------------------------------------
$ 1,312,684 $ 1,259,259
==================================================================================
</TABLE>
See accompanying notes to consolidated financial statements.
2
<PAGE>
SELECT THERAPEUTICS INC.
(A DEVELOPMENT STAGE ENTERPRISE)
Consolidated Statements of Operations
(Stated in U.S. dollars)
(Unaudited)
<TABLE>
<CAPTION>
====================================================================================================================================
Six months ended Three months ended
December 31, December 31,
- ------------------------------------------------------------------------------------------------------------------------------------
1999 1998 1999 1998
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Revenue $ 93,125 $ -- $ -- $ --
Cost of revenue 13,711 -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
79,414 -- -- --
Interest income 516 26,741 10 11,833
Research and development 331,624 301,792 209,955 73,754
Selling, general and administration 716,130 567,494 300,310 251,152
Depreciation 19,916 2,612 9,958 2,612
Amortization 129,875 43,292 64,938 43,292
- ------------------------------------------------------------------------------------------------------------------------------------
1,197,545 915,190 585,161 370,810
- ------------------------------------------------------------------------------------------------------------------------------------
Loss for the period $(1,117,615) $ (888,449) $ (585,151) $ (358,977)
====================================================================================================================================
Loss per share $ (0.18) $ (0.17) $ (0.10) $ (0.07)
Weighted average number of shares 6,078,546 5,105,649 6,078,546 5,105,649
====================================================================================================================================
</TABLE>
Consolidated Statements of Changes in Shareholders' Equity
(Stated in U.S. dollars)
Six months ended December 31, 1999
(Unaudited)
<TABLE>
<CAPTION>
====================================================================================================================================
Deficit
accumulated
during the
Common shares Contributed development
Shares Amount surplus stage Total
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Balance, June 30, 1998 4,981,313 $ 4,981 $ 3,176,046 $(2,118,274) $ 1,062,753
Issue of common shares 652,781 653 1,964,074 -- 1,964,727
Loss for the period -- -- -- (2,467,328) (2,467,328)
- ------------------------------------------------------------------------------------------------------------------------------------
Balance, June 30, 1999 5,634,094 5,634 5,140,120 (4,585,602) 560,152
Issue of common shares 1,034,264 1,034 1,071,516 -- 1,072,550
Loss for the period -- -- -- (1,117,615) (1,117,615)
- ------------------------------------------------------------------------------------------------------------------------------------
Balance, December 31, 1999 6,668,358 $ 6,668 $ 6,211,636 $(5,703,217) $ 515,087
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
See accompanying notes to consolidated financial statements.
3
<PAGE>
SELECT THERAPEUTICS INC.
(A DEVELOPMENT STAGE ENTERPRISE)
Consolidated Statements of Cash Flows
(Stated in U.S. dollars)
Six months ended December 31, 1999 and 1998
(Unaudited)
<TABLE>
<CAPTION>
================================================================================================
1999 1998
- ------------------------------------------------------------------------------------------------
<S> <C> <C>
Cash provided by (used in):
Operating activities:
Loss for the period $(1,117,615) $ (888,449)
Items not involving cash:
Depreciation 19,916 2,612
Amortization 129,875 43,292
Issue of common shares for services 90,000 --
Changes in non-cash operating working capital:
Accounts receivable 7,380 100,000
Inventory (1,763) 22
Prepaid expenses and other assets 3,360 27,178
Accounts payable 66,605 (164,894)
Accrued liabilities 31,885 (109,510)
- ------------------------------------------------------------------------------------------------
(770,357) (989,749)
Financing activities:
Repayment of loans due to the former
shareholders of Sierra Diagnostics Inc. -- (285,999)
Proceeds from issuance of common shares 982,550 --
Restricted cash (232,200) --
- ------------------------------------------------------------------------------------------------
750,350 (285,999)
Investing activities:
Additions to property, plant and equipment (33,953) (5,640)
- ------------------------------------------------------------------------------------------------
Decrease in cash (53,960) (1,281,388)
Cash and cash equivalents, beginning of period 120,881 2,070,705
- ------------------------------------------------------------------------------------------------
Cash and cash equivalents, end of period $ 66,921 $ 789,317
================================================================================================
Supplementary disclosure:
Non-cash financing and investing activities:
Issue of common shares for services $ 90,000 $ --
================================================================================================
</TABLE>
See accompanying notes to consolidated financial statements.
4
<PAGE>
SELECT THERAPEUTICS INC.
(A DEVELOPMENT STAGE ENTERPRISE)
Notes to Consolidated Financial Statements
(Stated in U.S. dollars)
Six months ended December 31, 1999 and 1998
(Unaudited)
================================================================================
Basis of presentation:
In the opinion of management, the unaudited consolidated financial statements of
Select Therapeutics Inc. (the "Company") included herein have been prepared on a
consistent basis with the June 30, 1999 audited consolidated financial
statements and include all material adjustments, consisting of normal recurring
adjustments, necessary to fairly present the information set forth therein.
These interim financial statements should be read in conjunction with the June
30, 1999 audited consolidated financial statements and notes thereto. The
Company's results of operations for the first two fiscal quarters of 1999 are
not necessarily indicative of future operating results.
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the amounts reported in the financial statements. Actual results could
differ materially from those estimates.
Capital stock
During the six months ended December 31, 1999 the company completed the
following capital stock transactions:
(i) 36,000 common shares were issued for $90,000 as consideration for
professional services;
(ii) In August 1999, the Board of Directors approved the reduction of the
April 1998 private offering common share price from $3.00 per share to
$2.00 per share and authorized the issuance of an additional 381,264
common shares to the subscribers of the April 1998 private offering;
(iii) 50,000 common shares were issued for gross cash proceeds of $125,000
in July 1999;
(iv) 151,000 common shares and 302,000 redeemable warrants were issued for
gross cash proceeds of $188,750 which related to the October 1999
private placement; and
(i) 416,000 common shares and 416,000 redeemable warrants were issued for
gross cash proceeds of $748,000 which related to the November 1999
private placement.
Share issue costs incurred in the six months ended December 31, 1999 in the
amount of $80,000 (1999 - $Nil) have been netted against contributed surplus.
5
<PAGE>
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
FORWARD-LOOKING STATEMENTS
THIS REPORT, INCLUDING WITHOUT LIMITATION, ITEM 2, MANAGEMENT'S DISCUSSION AND
ANALYSIS OR PLAN OF OPERATION, CONTAINS STATEMENTS WHICH ARE NOT HISTORICAL
FACTS AND ARE FORWARD-LOOKING STATEMENTS WHICH REFLECT MANAGEMENT'S
EXPECTATIONS, ESTIMATES AND ASSUMPTIONS. SUCH STATEMENTS ARE BASED ON
INFORMATION AVAILABLE AT THE TIME THIS FORM 10Q-SB WAS PREPARED AND INVOLVE
RISKS AND UNCERTAINTIES THAT COULD CAUSE FUTURE RESULTS, PERFORMANCE OR
ACHIEVEMENTS OF THE COMPANY TO DIFFER SIGNIFICANTLY FROM PROJECTED RESULTS.
FACTORS THAT COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY INCLUDE, WITHOUT
LIMITATION, THE HIGH COST AND UNCERTAINTY OF THE RESEARCH AND DEVELOPMENT OF
PHARMACEUTICAL PRODUCTS, THE UNPREDICTABILITY OF THE DURATION AND RESULTS OF THE
U.S. FOOD AND DRUG ADMINISTRATION'S REVIEW OF NEW DRUG APPLICATIONS, THE
COMPANY'S INABILITY TO OBTAIN ADDITIONAL CAPITAL, THE POSSIBLE IMPAIRMENT OF, OR
INABILITY TO OBTAIN, INTELLECTUAL PROPERTY RIGHTS AND THE COST OF OBTAINING SUCH
RIGHTS FROM THIRD PARTIES AND THE COMPANY'S DEPENDENCE ON THIRD PARTIES TO
RESEARCH, DEVELOP, MANUFACTURE AND SELL ITS PRODUCTS, IF ANY
Overview
The Company is a development stage biopharmaceutical company formed to
acquire and develop rights to selected early-stage compounds which have
potential use as therapeutics or diagnostics. The Company is developing a
portfolio of proprietary product opportunities and is aggressively pursuing
patents. In addition to licensed patents, the Company has agreements which
provide for options on related inventions arising from sponsored work.
Management believes that the Company has been able to identify and build
protection for a significant base for development of unique products. However,
competition in the areas of the Company's interests is intense, and both the
scientific and commercial environments change rapidly. By focusing on
intellectual property development and using external contractors, the Company
hopes to be able to maintain the required flexibility to adapt to changing
circumstances. The Company's key resources include qualified subcontractors and
a strong network of institutional investigators, and the Company believes that
it can move rapidly into clinical investigations and development of products
based on its intellectual property given adequate funding, which the Company
6
<PAGE>
does not now possess. The funding required for clinical trials significantly
exceeds the magnitude of funds raised by the Company to date, and there can be
no assurance that such funding will be available on acceptable terms if at all.
Since its inception (December 6, 1996), substantially all of the Company's
resources have been dedicated to research and development and technology
acquisition and management. To date, the Company has not generated significant
product revenues, and sales of Gonostat, launched in January 1999, and potential
sales of other diagnostic products are not expected to generate sufficient
revenues to cover the Company's operating costs during the next three years. The
Company will not receive revenue from sales of its therapeutic products unless
it completes clinical trials and successfully commercializes or arranges for the
commercialization of one or more of its products, as to the success of which no
assurance can be given. The process of developing the Company's therapeutic
products will require significant additional research and development,
preclinical testing and clinical trials, as well as regulatory approvals. These
activities, together with the Company's general and administrative expenses, are
expected to result in operating losses for at least three more years.
The continuation of the Company as a going concern is dependent on its
receipt of additional equity financing and on the development of economically
viable products. The Company has incurred losses of $2,442,328, $1,919,240 and
$199,034 in fiscal 1999, 1998 and 1997, respectively, and negative cash flow is
expected to continue for the Company for at least the next three years. There
can be no assurance that any additional funding will be available to the Company
or that the Company will be able to develop an economically viable product.
The Company is subject to risks common to biopharmaceutical companies,
including risks inherent in its research and development efforts and clinical
trials, reliance on collaborative partners, enforcement of patent and
proprietary rights, the need for future capital, potential competition and
uncertainty of regulatory approval. In order for a product to be commercialized,
it will be necessary for the Company and its collaborators to conduct
preclinical tests and clinical trials, demonstrate efficacy and safety of the
Company's product candidates, obtain regulatory clearances and enter into
manufacturing, distribution and marketing arrangements either directly or
through sublicensees. There can be
7
<PAGE>
no assurance that the Company will generate revenues or achieve and sustain
profitability in the future.
During the quarter which ended Dec 31, 1999, management's efforts continued
to be directed to obtaining bridge funds and repositioning the Company in order
to proceed with significant financing and product development efforts. The
Company filed with the Securities and Exchange Commission its registration
statement on Form 10-SB, and on November 16, 1999, upon the effectiveness of the
Form 10, the Company became subject to the applicable reporting requirements of
the Securities Exchange Act of 1934. In October 1999, Robert C. Galler joined
the Board of Directors. Mr. Galler has extensive experience in biotechnology
financing and he has been elected Vice President, Corporate Development.
In December 1999, the Company signed a placement agency agreement for a
significant private placement which is planned for the first quarter of calendar
2000. If successful, this placement will provide an adequate operating base for
the Company to move forward in its clinical programs which have been put on
'hold' pending availability of funds for their support.
Operational Review
During the quarter ended December 31st, the Company was able to maintain and
expand its research collaborations and strengthen its portfolio of intellectual
property. Academic research on applications of Verotoxin ("VT") continued in
collaborating institutions; however, due to the significant funding
requirements, production of clinically qualified materials was not initiated and
all clinically oriented programs were halted for both purging and direct
applications of the toxin. Both of these programs continue to be viewed as
promising, and management believes that with appropriate funding both can move
forward rapidly since institutional collaborations are in place with clinical
investigators. A basic patent on these uses of verotoxin (US patent 5,968,894)
issued in November 1999.
The application of VT to present antigens to dendritic cells continues to be a
promising approach to development of therapeutic vaccines for cancer and other
diseases which circumvent the immune system's surveillance. Research carried out
under the Company's option agreement with the Institut Curie has resulted in
very promising findings. On December 2, 1999, the Company announced the
extension of the option agreement and that a plan for clinical
8
<PAGE>
investigation of the technology is being developed in collaboration with Dr.
Evan Hersh at the Arizona Cancer Center. As with chemotherapeutic applications
of VT, significantly increased levels of expenditure will be required as
investigations move from the research laboratory setting to the clinical
setting. These expenses include but are not limited to development of materials
and formulations which are compliant with regulatory requirements and the costs
of patient recruitment and monitoring in trial settings.
Both the purging program and the dendritic cell program involve ex- vivo
therapies (i.e., treatments are carried out on patient tissues which have been
removed from the patient). A common characteristic of ex-vivo therapies is that,
relative to systemic administration, they are less costly to investigate. The
Company's focus is on identification of opportunities which combine low cost of
development with a strong proprietary position and potentially short time to
market. While there can be no assurance that viable products will result, the
Company's programs have the potential to yield therapeutic products within time
and financial constraints which offer attractive risk-return opportunities for
development.
In November 1998, the Company purchased Sierra Diagnostics Inc., a developer and
manufacturer of diagnostic products. The purchase and subsequent development of
Sierra was motivated by three factors: a need for in-house capability to develop
diagnostic tests required for therapeutic programs such as ex-vivo purging; a
requirement for a facility to develop and manufacture the Company's patented HIV
diagnostic; and the desire to develop earnings from operations in order to
offset some development costs.
Sierra has a base of proprietary technology relating to assays for sexually
transmitted diseases and handling of clinical samples. It launched two products
in 1999, both of which have significant revenue potential. The first product,
Gonostat(TM), is a clinical laboratory test for gonorrhea which offers unique
advantages in cost and performance relative to other technologies available in
the market. Although the market is highly competitive, Gonostat is expected to
capture a significant niche and become a profitable product. There can, however,
be no assurance of such performance. The second product brought to market by
Sierra is a sample preservation and handling product which eliminates the need
for refrigeration of clinical samples intended for molecular (DNA/RNA based)
assays. This product fits into the general practice of clinical testing and is
expected to find wide application due to
9
<PAGE>
elimination of sample degradation and thus the need for repeat testing or
sampling with attendant costs and inconvenience. The technology is proprietary
and believed to be patentable. Sales of products based on this technology and
efforts to license the technology to third parties are beginning but no
significant revenues have been generated.
At the end of October 1999, Sierra entered into an agreement for sales of its
products to Genelabs of Nairobi and believes that operating results for 2,000
will significantly improve. SELECT has engaged a sales and marketing group on a
consulting basis to assist in developing the market for both diagnostic products
and to evaluate other diagnostic opportunities for the Company. Sierra
Diagnostics has operated within its expense projections but sales of
Gonostat(TM), while contributing on a gross margin basis, lagged expectations.
This resulted in a higher than anticipated cash requirement for Sierra. To date,
the operations of Sierra have generated losses and there can be no assurance
that profitable operations will be achieved or that, if achieved, they can be
maintained.
Financial Review
Results of Operations
For the quarter ended December 31st 1999, the Company incurred a net loss of
$585,151 compared with a loss of $358,977 for the quarter ended December 31
1998. For the six months ended December 31 1999 the Company incurred losses of
$1,117,615 versus $888,198 for the corresponding period in 1998. The Company has
been unprofitable since its formation and has an accumulated deficit of
$5,703,217 through December 31, 1999. The net loss is a result of the routine
operations of the Company in its development stage. We expect losses to continue
and increase for the next three years as the Company pursues development and
commercialization of its intellectual property resources.
Revenues of $93,125 during the six months ended December 31st 1999 were
principally from the sale of Gonostat(TM); there was no interest income for the
quarter. During the corresponding quarter in 1998, there were no revenues from
sales and interest income was $11,833. The Company's sole operating revenues to
date arise from sales of diagnostic products through its wholly owned
subsidiary.
10
<PAGE>
Operating expenses for the six months ended December 31, 1999 were $1,117,615
compared to $888,449 in the same period of 1998. Expenditures required to
advance the Company's development projects, notably initiation of manufacturing
of GMP qualified materials, were deferred during the period.
All research and development activities of the Company are expensed as incurred.
Personnel costs including retained consultants and external contractors are the
largest ongoing cost of operations. Locating and retaining appropriate personnel
resources is a priority and the Company anticipates that personnel costs will
increase if adequate funding is obtained. The percentage of expenditures related
to personnel and other operations is expected to decline as increasing
commitments are made to external manufacturing and clinical studies.
Patent costs are expensed due to the uncertainties involved in realizing value
from specific patents.
There were no significant capital expenditures during the quarter ended December
31, 1999.
LIQUIDITY AND CAPITAL RESOURCES
The Company has financed its operations since inception primarily through
private placements of its Common Stock. As of December 31, 1999 the Company had
received approximately $860,000 in net proceeds from the sale of equity
securities during the quarter just ended. Events subsequent to the period have
continued to improve the prospects for the Company and management is optimistic
that adequate funding for continuation of operations and development of the
Company's technology assets can be obtained.
At December 31, 1999, the Company's cash position increased from $44,980 (at
September 30, 1999) to $66,921, with $304,200 in restricted cash (uncleared
funds from shareholder subscriptions from a private placement which had exceeded
the minimum closing requirement but which was ongoing). Accounts payable and
accrued liabilities decreased from $924,962 (as September 30, 1999) to $797,597.
However, sales of Sierra Diagnostic's products to date are not sufficient to
cover operating costs, and Sierra's ongoing operations require compliance with
FDA requirements and that a base level of manufacturing be maintained.
11
<PAGE>
The Company's limited financial resources have forced it to curtail some of its
planned operations through 1999, and the Company will require substantial
additional funding in order to complete its research and development activities
and sublicense any potential products.
The Company's future capital requirements will depend on many factors, including
scientific progress in its research and development programs, the size and
complexity of such programs, the scope and results of preclinical studies and
clinical trials, the ability of the Company to establish and maintain corporate
partnerships, the time and costs involved in obtaining regulatory approvals, the
costs involved in filing, prosecuting and enforcing patent claims, competing
technological and market developments, the cost of manufacturing preclinical and
clinical material and other factors not within the Company's control. There can
be no assurance that the additional financing necessary to meet the Company's
short and long-term capital requirements will be available on acceptable terms
or at all.
Insufficient funds may require the Company to delay, scale back or eliminate
some or all of its research or development programs, to lose rights under
existing licenses or to relinquish greater or all rights to product candidates
at an earlier stage of development or on less favorable terms than the Company
would otherwise choose or may adversely affect the Company's ability to operate
as a going concern. If additional funds are raised by issuing equity securities,
substantial dilution to existing stockholders may result.
The Company currently has funds sufficient to continue operations for less than
three months and does not have funds required to move current projects into
clinical investigations. Management has been in discussions with a number of
parties regarding additional financing required to maintain and develop the
Company's position and while it is optimistic that such funds may be available
there is no assurance that this will be the case.
Year 2000
Year 2000 (Y2K) issues arise because many computer systems use two rather than
four digits to identify the year, thus creating ambiguities which may produce
errors before, on or after January 1, 2000. If not addressed , errors could
impact all aspects of operations including financial reporting, clinical and
production
12
<PAGE>
records or controls and communications. Errors may range from minor to
significant systems failures and could be imported from suppliers' systems.
We have assessed, taken corrective actions in light of, and continue to monitor
our vulnerability to Y2K issues in all aspects of our business including
information and computer systems and critical suppliers and service providers.
To the best of our knowledge, systems and equipment critical to our operations
are Y2K compliant. However, it is not possible to be certain that the systems of
our suppliers, service providers or other third parties upon which we rely are
compliant or that they will be unaffected by problems in their own supply chain.
Based on the nature of our operations and ongoing assessments we believe that
Select has little direct exposure to Y2K issues.
We estimate that our direct costs of addressing the Y2K issues are less than
$5,000, which are being expensed in the normal course of our business
operations.
ITEM 6. Exhibits and Reports on Form 8-K
(a) Exhibits
The following exhibit is filed with this report: Page
----
27. Financial Data Schedule 15
13
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SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
Dated: February 4, 2000 SELECT THERAPEUTICS, INC.
By: /s/ Robert Bender
------------------------
Name: Robert Bender
Title: Chairman of the Board
14
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
consolidated finanancial statements for the six months ended December 31, 1999
and is qualified in its entirety by reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> JUN-30-2000
<PERIOD-START> JUL-01-1999
<PERIOD-END> DEC-31-1999
<CASH> 66,921
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 33,893
<CURRENT-ASSETS> 423,394
<PP&E> 170,597
<DEPRECIATION> 52,013
<TOTAL-ASSETS> 1,312,684
<CURRENT-LIABILITIES> 797,597
<BONDS> 0
0
0
<COMMON> 6,668
<OTHER-SE> 6,211,636
<TOTAL-LIABILITY-AND-EQUITY> 1,312,684
<SALES> 93,125
<TOTAL-REVENUES> 93,641
<CGS> 13,711
<TOTAL-COSTS> 13,711
<OTHER-EXPENSES> 1,197,545
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (1,117,615)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (1,117,615)
<EPS-BASIC> (0.18)
<EPS-DILUTED> (0.18)
</TABLE>
