10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

_______________________________

FORM 10 – Q

_______________________________

x QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended December 31, 2012

OR

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

Commission File Number: 000-52321

Cellceutix Corporation

 (Exact name of registrant as specified in its charter)

Nevada	30-0565645
(State or Other Jurisdiction of	(I.R.S. Employer
Incorporation or Organization)	Identification Number)

100 Cumming Center, Suite 151-B

Beverly, MA  01915

 (Address of principal executive offices and zip code)

(978)-633-3623

(Registrant’s telephone number, including area code) 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the preceding 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.                    Yesx    No¨

Indicate by a check mark whether the registrant has submitted electronically and posted on its corporate website, 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). Yesx  No¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer.  See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer¨	Accelerated filer¨
Non-accelerated filer¨	Smaller reporting companyx

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes¨ Nox

The number of shares outstanding of the Registrant’s Common Stock as of February 11, 2013 was 95,622,984 shares.

1

CELLCEUTIX CORPORATION

FORM 10-Q

INDEX

 TABLE OF CONTENTS

		PART I    FINANCIAL INFORMATION
Item	1	Financial Statements
		Balance Sheets-December 31, 2012 (Unaudited) and June 30, 2012 (Audited)	4
		Statements of Operations (Unaudited) - For the Three and Six Months Ended December 31, 2012 and 2011, and for the cumulative period from June 20, 2007 (Date of Inception) to December 31, 2012	6
		Statements of Changes in Stockholder’s Deficit  (Unaudited) - For the cumulative period from June 20, 2007 (Date of Inception) to December 31, 2012	8
		Statements of Cash Flows (Unaudited) - For the Six Months Ended December 31, 2012 and 2011, and for the cumulative period from June 20,  2007 (Date of Inception) to December 31, 2012	13
		Notes to Financial Statements (Unaudited)	15
Item	2	Management’s Discussion & Analysis of Financial Condition and Results of Operations	23
Item	3	Quantitative and Qualitative Disclosures About Market Risk	26
Item	4	Controls & Procedures	27
		PART II OTHER INFORMATION
Item	1	Legal Proceedings	27
Item	2	Unregistered Sales of Equity Securities Use of Proceeds	27
Item	3	Default Upon Senior Securities	28
Item	4	Mine Safety Disclosures	29
Item	5	Other Information	29
Item	6	Exhibits	29
		Signatures	30

2

Part 1.  Financial Information

Item 1.  Financial Statements

Cellceutix Corporation
(A Development Stage Enterprise)
Balance Sheets
		December 31, 2012				June 30, 2012
		(Unaudited)				(Audited)
Assets
Current assets:
	Cash	$		222,862		$		27,703
	Prepaid expenses			12,204				325
Total current assets				235,066				28,028
Deferred offering costs				297,001				-
Intangibles, net				2,847				-
Total assets		$		534,914		$		28,028
Liabilities and Stockholders' Deficit
Current liabilities:
	Accounts payable (including related party payables of $1,695,683 and $1,695,820, respectively)	$		1,988,003		$		1,966,026
	Accrued expenses (including related party accruals of $412,565 and $316,130, respectively)			412,568				330,880
	Accrued salaries and payroll taxes			3,204,023				2,789,571
	Note payable to officer			2,022,264				2,022,264
	Accrued settlement costs, current			288,270				270,055
Total current liabilities				7,915,128				7,378,796
Long Term Liabilities
	Accrued settlement costs, net of current			275,229				275,229
Total liabilities				8,190,357				7,654,025
Stockholders' Deficit
Preferred stock; $.001 par value; 9,500,000 shares authorized
Series A convertible preferred stock; $.001 par value; 500,000 shares designated, 0 and 0
shares issued and outstanding as of December 31, 2012 and June 30, 2012, respectively					-			-
Common stock:
Class A, $.0001 par value; 300,000,000 shares authorized; 98,385,068 and 94,968,905
shares issued as of December 31, 2012 and June 30, 2012 and 95,622,984 and 92,206,821
shares outstanding as of December 31, 2012 and June 30, 2012, respectively					9,839				9,497
Class B (10 votes per share); $.0001 par value; 100,000,000 shares authorized, 0
shares issued and outstanding, respectively					-				-
Additional paid in capital					10,628,983				9,229,157
Deficit accumulated during development stage					(17,766,537)				(16,336,918)
Treasury stock 2,762,084 shares at cost as of December 31, 2012 and June 30, 2012
respectively					(527,733)				(527,733)
Total stockholders' deficit					(7,655,443)				(7,625,997)
Total Liabilities and Stockholders' Deficit			$		534,914		$		28,028
The accompanying notes are an integral part of these financial statements.

3

Cellceutix Corporation (A Development Stage Enterprise) Statements of Operations
(Unaudited)
									For the cumulative period from June 20, 2007 (Date of Inception) through December 31, 2012
	For the Three Months Ended				For the Six Months Ended
	December 31,				December 31,
	2012		2011		2012		2011
Revenues	$	-	$	-	$	-	$	-	$	-
Operating expenses:
Research and development, gross		281,516		106,964		466,469		209,866		5,563,481
Grants		-		-		-		-		(733,438)
Research and development, net of grants		281,516		106,964		466,469		209,866		4,830,043
General and administrative expenses		28,267		12,230		52,287		19,069		587,058
Officers' payroll and payroll tax expense		113,975		646,582		227,949		1,298,904		7,821,633
Professional fees		244,573		225,230		321,888		357,321		2,900,799
Patent expense		20,409		81,720		29,059		81,720		197,352
Total operating expenses		688,740		1,072,726		1,097,652		1,966,880		16,336,885
Loss from operations		(688,740)		(1,072,726)		(1,097,652)		(1,966,880)		(16,336,885)
Interest expense - net		(60,080)		(77,787)		(120,160)		(145,086)		(703,188)
Warrant expense		-		(909,892)		-		(909,892)		(439,892)
Total other expenses		(60,080)		(987,679)		(120,160)		(1,054,978)		(1,143,080)
Net loss before provision for income taxes		(748,820)		(2,060,405)		(1,217,812)		(3,021,858)		(17,479,965)
Provision for income taxes		-		-		-		-		-
Net loss	$	(748,820)	$	(2,060,405)	$	(1,217,812)	$	(3,021,858)	$	(17,479,965)
Deemed dividends		-		-		(211,802)		-		(277,488)
Net loss attributable to common stockholders	$	(748,820)	$	(2,060,405)	$	(1,429,614)	$	(3,021,858)	$	(17,757,453)
Basic and diluted loss per share attributable to
common stockholders	$	(0.01)	$	(0.01)	$	(0.02)	$	(0.03)
Weighted average number of common shares used in basic
and fully diluted per share calculations		93,507,421		94,076,076		93,001,981		92,996,474
The accompanying notes are an integral part of these financial statements.

4

Cellceutix Corporation
(A Development Stage Enterprise)
Statement of Changes in Stockholders' Deficit
For the cumulative
Period June 20, 2007 (Date of Inception)
through December 31, 2012
(Unaudited)
									Deficit
									Accumulated
	Common Stock			Preferred Stock			Additional		During the		Treasury Stock
			Par Value		Par Value		Paid-in		Development
	Shares		$ 0.0001	Shares		$ 0.001	Capital		Stage		Shares		Amount		Total
Shares issued June 20, 2007
(Inception)	1,000,000	$	100	-	$	-	$	-	$	-	-	$	-	$	100
Net loss	-		-	-		-		-		(530)	-		-		(530)
Balance, June 30, 2007	1,000,000		100							(530)					(430)
Share exchange with
Cellceutix Pharma, Inc.
December 6, 2007	(1,000,000)		(100)	-		-		-		100	-		-		-
Share exchange in reverse
merger with Cellceutix
Pharma, Inc.
December 6,2007	82,000,000		8,200	-		-		-		(8,200)	-		-		-
Shares exchanged in a reverse
acquisition of Cellceutix
Pharma, December 6, 2007	9,791,000		979	-		-		-		(979)	-		-		-
Issuance of stock options	-		-	-		-		43,533		-	-		-		43,533
Forgiveness of debt from a
stockholder	-		-	-		-		50		-	-		-		50
Capital contribution from a
stockholder	-		-	-		-		50		-	-		-		50
Shares issued for services,
April 28, 2008 at $1.05	100,000		10	-		-		104,990		-	-		-		105,000
Net loss	-		-	-		-		-		(510,193)	-		-		(510,193)
Balance June 30, 2008	91,891,000		9,189	-		-		148,623		(519,802)	-		-		(361,990)
Cancellation of shares issued
for services, December 31, 2008	(100,000)		(10)	-		-		(104,990)		-	-		-		(105,000)
Issuance of stock options	-		-	-		-		142,162		-	-		-		142,162
Shares issued for services
June 11, 2009 at $0.38,	20,000		2	-		-		7,598		-	-		-		7,600
Shares issued for services
June 30, 2009 at $0.38	25,000		3	-		-		9,497		-	-		-		9,500
Net loss	-		-	-		-		-		(1,485,331)	-		-		(1,485,331)
Balance, June 30, 2009	91,836,000		9,184	-		-		202,890		(2,005,133)	-		-		(1,793,059)
Shares issued for services,
July 6, 2009 at $0.43,	25,000		2	-		-		10,748		-	-		-		10,750
Shares issued for services
February 5, 2010 at $0.30	3,500		-	-		-		1,050		-	-		-		1,050
Issuance of stock options	-		-	-		-		383,291		-	-		-		383,291
Shares issued for services
June 1, 2010 at $0.45	75,000		8	-		-		33,742		-	-		-		33,750
Net loss	-		-	-		-		-		(3,433,400)	-		-		(3,433,400)
Balance, June 30, 2010,	91,939,500		9,194	-		-		631,721		(5,438,533)	-		-		(4,797,618)
Shares issued for services
July 6, 2010 at $0.55	50,000		5	-		-		27,495		-	-		-		27,500
Cancellation of shares issued	(75,000)		(8)	-		-		(33,742)		-	-		-		(33,750)
Issuance of stock options	-		-	-		-		3,060,691		-	-		-		3,060,691
Modification of stock options	-		-	-		-		237,098		-	-		-		237,098
Forgiveness of liability in
connection with settlement
with stockholder	-		-	-		-		932,966		-	-		-		932,966
Repurchase of common stock
in connection with settlement	-		-	-		-		-		-	4,602,313		(859,388)		(859,388)
Shares issued for services,
March 1, 2011 at $0.32	184,375		18	-		-		58,982		-	-		-		59,000
Shares issued for services,
February 8, 2011 at $0.20	70,000		7	-		-		13,993		-	-		-		14,000
Cancellation of treasury stock	(460,229)		(45)	-		-		(99,955)		-	(460,229)		100,000		-
Shares issued for service
May 26, 2011 at $0.81	12,000		1	-		-		9,719		-	-		-		9,720
Net loss	-		-	-		-		-		(5,938,297)	-		-		(5,938,297)
Balance, June 30, 2011	91,720,646		9,172	-		-		4,838,968		(11,376,830)	4,142,084		(759,388)		(7,288,078)
Issuance of stock options	-		-	-		-		2,114,386		-	-		-		2,114,386
Convertible debentures converted to common stock	707,277		71	-		-		353,564		-	-		-		353,635
Shares issued for services, August 29, 2011 at $0.38	100,000		10	-		-		37,990		-	-		-		38,000
Shares issued for services, November 8, 2011 at $0.41	125,000		13	-		-		51,236		-	-		-		51,249
Shares issued for services, January 11, 2012 at $0.45	200,000		20	-		-		89,980		-	-		-		90,000
Shares issued for charitable contributions, March 7
2012 at $0.52	265,228		26	-		-		137,894		-	-		-		137,920
Shares issued for services, April 26, 2012 at $0.46	300,000		30	-		-		137,970		-	-		-		138,000
Shares issued for services, May 3, 2012 at $0.49	100,000		10	-		-		48,990		-	-		-		49,000
Shares issued for services, May 29, 2012 at $0.53	25,000		2	-		-		13,248		-	-		-		13,250
Shares issued for services, June 29, 2012 at $0.62	50,000		5	-		-		31,145		-	-		-		31,150
Issuance of capital stock	2,500,000		250	-		-		582,143		-	-		-		582,393
Reclassification of warrants into equity	-		-	-		-		857,500		-	-		-		857,500
Cancellation of treasury stock	(1,380,000)		(138)	-		-		(231,517)		-	(1,380,000)		231,655		-
Issuance of preferred stock	-		-	10,000		10		99,990		-	-		-		100,000
Deemed dividend's	-		-	-		-		65,686		(65,686)	-		-		-
Conversion of preferred stock to common stock	255,754		26	(10,000)		(10)		(16)		-	-		-		-
Net loss	-		-	-		-		-		(4,894,402)	-		-		(4,894,402)
Balance June 30, 2012	94,968,905	$	9,497	-	$	-	$	9,229,157	$	(16,336,918)	2,762,084	$	(527,733)	$	(7,625,997)
Issuance of stock options	-		-	-		-		125,915		-	-		-		125,915
Shares issued for services, July 25, 2012 at $0.59	25,000		3	-		-		14,747		-	-		-		14,750
Shares issued for services, August 26, 2012 at $0.60	50,000		5	-		-		29,995		-	-		-		30,000
Shares issued for services, October 24, 2012 at $0.87	50,000		5	-		-		43,495		-	-		-		43,500
Shares issued as commitment fee, December 6, 2012 at $0.89	336,625		34	-		-		299,967		-	-		-		300,001
Shares sold, December 6, 2012 at $0.89, net of offering costs	112,208		11	-		-		96,989		-	-		-		97,000
Exercise of stock options	250,000		225	-		-		276,975		-	-		-		277,200
Issuance of preferred stock	-		-	30,000		30		299,970		-	-		-		300,000
Deemed dividends	-		-	-		-		211,802		(211,802)	-		-		-
Conversion of preferred stock to common stock	592,330		59	(30,000)		(30)		(29)		-	-		-		-
Net loss	-		-	-		-		-		(1,217,812)	-		-		(1,217,812)
Balance December 31, 2012	95,385,068	$	9,839	-	$	-	$	10,628,983	$	(17,766,532)	2,762,084	$	(527,733)	$	(7,655,443)

5

Cellceutix Corporation
(A Development Stage Enterprise)
Statements of Cash Flows
(Unaudited)
						For the cumulative period from June 20, 2007 (Date of Inception) through December 31, 2012
		For the Six Months Ended
		December 31,
		2012		2011
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss		$	(1,217,812)	$	(3,021,858)	$	(17,479,965)
Adjustments to reconcile net loss to net cash used in
operating activities:
Common stock and stock options issued as payment for
services compensation, services rendered, and
charitable contributions			214,165		1,269,630		6,903,283
Cancellation of stock issued for services			-		-		(28,750)
Amortization of accrued settlement costs			18,215		34,173		104,111
Gain (loss) on financial instruments			-		909,892		439,892
Changes in operating assets and liabilities:
	Other receivables		-		204,144		-
	Prepaid expenses		(11,879)		(1,010)		(3,719)
	Amortization of intangibles		501		-		501
	Accounts payable		21,977		(101,665)		1,988,052
	Accrued expenses		81,688		116,313		629,979
	Accrued officers' salaries and payroll taxes		414,452		366,340		4,136,988
Net cash used in operating activities			(478,693)		(224,041)		(3,309,628)
CASH FLOWS FROM INVESTING ACTIVITIES:
Intangibles			(3,348)		-		(3,348)
Net cash used in investing activities			(3,348)		-		(3,348)
CASH FLOWS FROM FINANCING ACTIVITIES:
Capital contribution from stockholder			-		-		50
Sale of common stock							100
Sale of common stock, net of offering costs			97,000		-		97,000
Deferred offering costs			3,000		-		3,000
Sale of preferred stock			300,000		-		400,000
Payment of settlement liabilities			-		-		(400,000)
Loan from officer			-		20,000		1,925,587
Proceeds from convertible debentures			-		-		(167,099)
Redemption of convertible debentures			-		-		400,000
Proceeds from subscription			-		1000000		1,000,000
Exercise of stock options			277,200		-		277,200
Net cash provided by financing activities			677,200		1,020,000		3,535,838
NET (DECREASE) INCREASE IN CASH AND CASH
EQUIVALENTS			195,159		795,959		222,862
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD			27,703		68,661		-
CASH AND CASH EQUIVALENTS, END OF PERIOD		$	222,862	$	864,620	$	222,862
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash paid for interest		$	25,909	$	-	$	40,735
SUPPLEMENTAL DISCLOSURE OF NON-CASH FLOW
FINANCING ACTIVITIES
Common stock issued for acquisition		$	-	$	-	$	9,079
Forgiveness of debt		$	-	$	-	$	50
Reclassification of accrued interest to note payable and
convertible debentures		$	-	$	-	$	197,964
Cancellation of common stock for services		$	-	$	-	$	(138,750)
Settlement of accrued payroll and payroll taxes		$	-	$	-	$	932,966
Cancellation of common stock as a result of settlement		$	-	$	-	$	859,388
Debt converted to common stock		$	-	$	353,635	$	353,635
Cancellation of treasury stock		$	-	$	-	$	(231,655)
Reclassification of warrants to equity		$	-	$	-	$	857,500
Deemed dividend from beneficial conversion
feature on preferred stock		$	53,032	$	-	$	70,678
Deemed dividend - warrants		$	158,770	$	-	$	206,810
Conversion of preferred stock into common stock		$	(30)	$	-	$	(46)
The accompanying notes are an integral part of these financial statements.

6

Cellceutix Corporation

(A Development Stage Enterprise)

Notes to Financial Statements

December 31, 2012

(Unaudited)

1.       Organization And Nature Of Business

Cellceutix Corporation, formerly known as EconoShare, Inc., (the “Company” or the “Registrant”) was incorporated on August 1, 2005 in the State of Nevada and was organized for the purpose of developing a B2B (Business to Business) website for an Asset Sharing market place and transaction system.

On December 6, 2007, the Company acquired Cellceutix Pharma, Inc., a privately owned Delaware corporation pursuant to an Agreement and Plan of Share Exchange (the “Exchange”).  Cellceutix Pharma, Inc. was incorporated under the laws of the State of Delaware on June 20, 2007.  Its assets consisted of rights assigned to it for six early stage pharmaceutical compounds by three different scientists.

Pursuant to the terms of the Exchange, the Company acquired Cellceutix Pharma, Inc. in exchange for an aggregate of 82,000,000 newly issued shares of the Company’s common stock, par value $0.0001 per share (the “Common Stock”).  As a result of the Exchange, Cellceutix Pharma, Inc. became a wholly-owned subsidiary of the Company.  The Company’s shares were issued to the Cellceutix Pharma, Inc. shareholders on a pro rata basis, on the basis of 82 shares of Common Stock for each share of Cellceutix Pharma, Inc. common stock held by such Cellceutix Pharma, Inc. shareholder at the time of the Exchange.  This resulted in the former holders of Cellceutix Pharma, Inc. Common Stock, upon Exchange, owning approximately 89% of the outstanding shares of the Company’s Common Stock. Accordingly, the Exchange represented a change in control.  For financial accounting purposes, the acquisition was a reverse acquisition of the Company by Cellceutix Pharma, Inc., under the purchase method of accounting, and was treated as a recapitalization with Cellceutix Pharma, Inc. as the legal acquirer. Upon consummation of the Exchange, the Company adopted the business plan of Cellceutix Pharma, Inc. . We are an early stage developmental biopharmaceutical company.  The Company has no customers, products or revenues to date, and may never achieve revenues or profitable operations. 

On January 14, 2008, a majority of the shareholders of the Company approved an amendment to the Registrant’s articles of incorporation to change the name of the Registrant to Cellceutix Corporation.  Upon the filing of a Definitive Information Statement and effectiveness of the name change on February 1, 2008, the Company applied to the National Association of Security Dealers (NASD) to change its stock symbol on the Over the Counter Bulletin Board which resulted in the Company’s stock symbol being changed to CTIX. 

On December 29, 2010 shareholders adopted and approved the 2010 Equity Incentive Plan and authorized an amendment to the Company’s Articles of Incorporation to authorize Class B common stock convertible into Class A common stock on a 1:1 basis, however the Class B Common Stock shall entitle ten votes for each share of Class B Common Stock. All shares issued as of balance sheet dates are Class A common stock.

On June 21, 2012, the U.S. Food and Drug Administration ("FDA") approved the Investigational New Drug (IND) application for Kevetrin™, Cellceutix's novel anti-cancer compound. The Phase 1 trials are being conducted at Harvard Cancer Center's Dana-Farber Cancer Institute and partner Beth Israel Deaconess Medical Center.  The clinical trial will test Kevetrin against a variety of different solid tumor cancer types in patients with advanced-stage cancers. Primary endpoints for the study will be safety, tolerable dosing levels and establishing the dose for a future Phase II clinical trial. The trial is registered on www.clinical trials.gov. http://clinicaltrials.gov/ct2/show/NCT01664000?term=Kevetrin&rank=1

In March 2012, we entered into an agreement with Beth Israel Deaconess Medical Center (BIDMC), a teaching hospital of Harvard Medical School, on an innovative research project with Kevetrin. The Medical Center wishes to exploit the nuclear and/or mitochondrial pro-apoptotic function of p53 in melanoma and renal cell carcinoma, two types of cancer that are particularly resistant to therapy. BIDMC hopes to improve therapy for melanoma and renal cell carcinoma, cancers that are particularly resistant to therapy. 

7

BIDMC initiated combination studies with multikinase inhibitors which activate pro-apoptotic activity by translocation of p53 in mitochondria thereby inducing apoptosis. Apoptosis is enhanced by MDM2 inhibitors by stabilizing p53. As presented at the American Association for Cancer Research (AACR) meeting in April, Kevetrin phosphorylates MDM2 which activates and stabilizes p53 by monoubiquitination inducing apoptosis. Prior data from the BIDMC laboratory showed that agents of this class can augment the pro-apoptotic and antitumor effects of MDM2 antagonists and is expected to have a synergistic effect with Kevetrin. BIDMC will test the effects of Kevetrin alone and in combination with FDA-approved VEGFR antagonists in the renal cell carcinoma and melanoma studies. In vitro study endpoints include apoptosis by measuring caspase activation and PARP cleavage. In vivo endpoints include efficacy in a xenograft model, tumor vascularity, p53 levels, p21 expression and apoptosis. This study will provide vital insight to exploit the nuclear and/or mitochondrial pro-apoptotic function by Kevetrin in combination with other multikinase inhibitors in treatment of these difficult to treat malignancies. At this time the study is in progress. Results of these preclinical tests provided to date to the Company are encouraging and BIDMC and Cellceutix wish to move the study further. Cellceutix has provided the requested information from BIDMC that will be used to investigate a Specialized Programs of Research Excellence (SPORE) grant for a phase 2 clinical study of renal cancer.

In January 2013 the Company announced that the University of Bologna in Italy (the “University”) and The Italian Cooperative Study Group on Chronic Myeloid Leukemia (ICSG on CML) and Acute Leukemia (GIMEMA Group) plan on testing Kevetrin against Acute Myelogenous Leukemia (AML). The Company has been advised that the study, a phase 1b trial, will be titled “A Multi-Center, Open-Label, Phase 1B Study of Escalating Doses of Kevetrin (Thioureidobutyronitrile) Administered Intravenously, with Cytarabine Adminstered A) Subcutaneously, or B) Intravenously, in Patients with Acute Myelogenous Leukemia (AML).” The study is scheduled to begin in the first half of 2013. The University will source the funding for this trial.

The Company also announced it is presently in discussions with other institutions for collaborations in conducting clinical trials with Kevetrin on multiple cancers.

In June 2012, Cellceutix participated in a pre IND meeting with the U.S. Food and Drug Administration ("FDA") pertaining to Prurisol™, a drug for treating psoriasis. The Company had requested the meeting for guidance on its initiatives to seek a section 505(b)(2) designation for Prurisol™, which would allow the Company to forgo early-stage trials and advance Prurisol™ into latter-stage clinical trials.  Cellceutix was advised by the FDA that a 505(b)(2) application would be an acceptable approach for Prurisol. In September 2012, Cellceutix selected Dr. Reddy's Laboratories as its vendor to manufacture and formulate Prurisol for planned clinical trials. The Company plans to sponsor a Phase II/III Proof of Concept trial in Europe that is planned to begin late first quarter/early second quarter 2013. This will be a relatively short trial with only 30 days of treatment and 30 days of follow-up to evaluate the efficacy and safety of Prurisol. The manufacturer, Dr. Reddy’s Laboratories Ltd., has advised the Company that the manufacturing of Prurisol is planned to begin in February 2013.

At this time the Company is focusing its research and development efforts exclusively on Kevetrin and Prurisol.

On September 13, 2012, the company filed a Certificate of Correction with the State of Nevada to correct the par value of the preferred shares from the amended articles of incorporation filed June 24, 2011 from $.0001 per share to $.001 per share. 

On December 6, 2012 , the Company entered into a Class A Common Stock Purchase Agreement with Aspire Capital Fund, LLC, which provides that upon meeting the terms of the agreement, Aspire Capital is committed to purchase up to an aggregate of $10,000,000 million of the Company’s shares of Class A Common Stock over the approximately 36-month term of the Purchase Agreement. (SEE NOTE 9)

On December 25, 2012 the United States Patent and Trademark Office (USPTO) awarded the Company U.S. Patent No. 8,338,454 B2, titled "Nitrile Derivatives and their Pharmaceutical Use and Compositions." The patent covers pharmaceutical compositions comprising Kevetrin™, and related compounds and compositions.

The Company’s Common Stock is quoted on the Over the Counter Bulletin Board (OTCBB), symbol “CTIX”.

2.          Financial Statements

In the opinion of management, all adjustments consisting only of normal recurring adjustments necessary for a fair statement of (a) the results of operations for the three and six month periods ended December 31, 2012 and 2011, (b) the financial position at December 31, 2012 and (c) cash flows for the six month periods ended December 31, 2012 and 2011, have been made.  

The unaudited financial statements and notes are presented as permitted by Form 10-Q. Accordingly, certain information and note disclosures normally included in the financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been omitted. The accompanying financial statements and notes should be read in conjunction with the Company’s Form 10K for the fiscal year ended June 30, 2012.  The results of operations for the three and six month periods ended December 31, 2012 are not necessarily indicative of those to be expected for the entire year.    

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The company has evaluated all subsequent events through the filing date of this form 10-Q with SEC, to ensure that this form 10-Q includes subsequent events that should be recognized in the financial statements as of December 31, 2012, and appropriate disclosure of subsequent events which were not recognized in the financial statements.

3.         Going Concern

The accompanying financial statements have been prepared assuming the Company will continue as a going concern. For the period since June 20, 2007 (date of inception) through December 31, 2012, the Company has had a cumulative net loss attributable to common stockholders of $17,766,532 and a working capital deficit of $7,680,062 at December 31, 2012.  As of December 31, 2012, the Company has not emerged from the development stage. In view of these matters, the ability of the Company to continue as a going concern is dependent upon the Company’s ability to generate additional financing. Since inception, the Company has financed its activities principally from the use of equity securities, debt issuance and loans from an officer to pay for its operations. The Company intends on financing its future development activities and its working capital needs largely from the issuance of debt and the sale of equity securities, until such time that funds provided by operations are sufficient to fund working capital requirements. The Company has entered into a financing agreement with Aspire Capital Fund for $10,000,000. The Company does not have the right to commence any sales of its shares to Aspire Capital Fund until the SEC has declared the registration statement filed on January 22, 2012, effective. (See Note 9 referencing Aspire Capital Fund). If the SEC doesn’t declare our registration effective, there can be no assurance that the Company will be successful at achieving its financing goals at reasonably commercial terms, if at all.

The economic downturn and market instability has made the business climate more volatile and more costly.  If the current equity and credit markets deteriorate further or do not improve, it may make necessary debt or equity financing more difficult, more costly and more dilutive.  Failure to secure any necessary financing in a timely manner and on favorable terms could have a material adverse effect on the Company’s growth strategy, financial performance and stock price and could require the delay of new product development and clinical trial plans.  

These factors raise substantial doubt about the Company's ability to continue as a going concern. The accompanying financial statements do not include any adjustments relating to the recoverability of the recorded assets or the classification of liabilities that may be necessary should the Company be unable to continue as a going concern.  

4.          Recent accounting pronouncements

The Company has reviewed all recent accounting pronouncements issued by FASB (including EITF), the AICPA and the SEC and did not or are not believed by management to have a material impact on the Company’s present or future financial statements.

5.           Commitments and Contingencies

Settlement Agreement

On February 14, 2011, the Company announced it reached a settlement agreement on all outstanding claims and issues between the Company and our former CEO, Mr. Evans. Each party dropped their respective claims and as a result all of Mr. Evans accrued salaries and options were cancelled.  The terms of the agreement provide that the Company purchase 4,602,312 common shares held by Mr. Evans and/or Mr. Evans’ sons over a period of three years for a total sum of one million dollars.   Payment by the Company in the amount of $100,000 was made upon signing of the agreement, which resulted in reducing the liability owed to Mr. Evans; cancelling 460,229 shares of common stock.  On February 4, 2012, the Company made the second payment of $300,000 to Mr. Evans and cancelled 1,380,000 shares of its common stock.  The remaining 2,762,084 shares of common stock held in escrow until additional payments are made under the agreement are shown as Treasury Stock on the Company’s Balance Sheet. 

The Company had initially recorded this settlement at December 31, 2010 as a liability of the present value of the future payments and treasury stock. The Company had also recorded the forgiveness of Mr. Evans’ accrued payroll and related payroll taxes as a capital contribution of $932,966.  As of December 31, 2012, the settlement liability is $563,499 of which $288,270 is due in February 2013 and recorded as current liability. 

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Legal

Cellceutix Corporation has entered into a settlement agreement with a former vendor Toxikon Corporation, settling all claims asserted by Toxikon in a civil action filed by Toxikon Corporation in the Commonwealth of Massachusetts.  Cellceutix Corporation has agreed to pay Toxikon Corporation ninety-thousand ($90,000.00) dollars prior to March 1, 2013 in full settlement of the claims asserted and the amount has been recorded on the balance sheet as of December 31, 2012..

Formatech is a former vendor of the Company which had received Cellceutix common stock and had also gone bankrupt. In July 2012, Cellceutix was advised that a US Bankruptcy Court judge has allowed Formatech’s bankruptcy trustee to sell 184,375 restricted shares of Cellceutix Class A Common Stock. The proceeds of any sales of these shares will be held in escrow pending the outcome of Cellceutix’s claims against Formatech. Cellceutix has engaged an attorney with the aim of recovering these funds.

Pharmaceutical Compounds

On August 2, 2007, the Company was assigned all right, title, and interest to three pharmaceutical compounds; Kevetrin, KM 277 and KM 278, by their inventors. The Company was assigned all right, title, and interest to an additional three pharmaceutical compounds on October 17, 2007, KM 133 KM 362 and KM 3174. In July 2009, the Company was assigned all right, title, and interest to KM 732.  In exchange for these compounds, the Company agreed to pay the inventors 5% of net sales of the compounds in countries where composition of matter patents have been issued and 3% of net sales in other countries. Kevetrin, KM 277, KM 278 and KM 362 were acquired from our President and director, Dr. Krishna Menon.  In December 2012, the Company was issued a US patent  for Kevetrin.  The Company intends to file patent applications for each of the other six compounds as studies advance and funds become available.    

 In December 2009, the Company was assigned all right, title and interest to a new compound, KM-391, which it intends to develop for the treatment of autism.  In exchange for this compound, the Company agreed to pay the inventors $10,000 plus 4.5% of net sales of the compound in countries where a composition of matter patent has been issued and 3% of net sales in other countries.

Employment Agreements

On December 29, 2010, the Company entered into employment agreements with its two executive officers, Leo Ehrlich, the Company’s Chief Executive Officer, and Krishna Menon, Chief Scientific Officer. Both agreements provide for a three year term with each executive receiving an annual base salary for $350,000 per year commencing January 1, 2011, with an annual increase of 10% for each year commencing January 2012. In addition, the Company’s Board awarded stock options exercisable at $0.11 per share pursuant to the Company’s 2010 Equity Incentive Plan to each executive officer as follows:  a total of 18 million options with 6 million options vesting on December 29, 2010, 6 million options vesting on June 30, 2011 and 6 million options vesting on January 3, 2012.    The Board, at its discretion, may increase the base salary based upon relevant circumstances.

The Company has recorded accrued officers’ salaries and payroll taxes are as follows:

	December 31, 2012		June 30, 2012
Krishna Menon	$	1,635,000	$	1,442,500
Leo Ehrlich	$	1,397,500	$	1,205,000
Accrued Payroll Taxes	$	171,523	$	142,071
	$	3,204,023	$	2,789,571

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6.           Related Party Transactions

Office Lease

Dr. Menon, the Company’s principal shareholder, President, and Director, also serves as the Chief Operating Officer and Director of Kard Scientific (“KARD”). On December 7, 2007, the Company began renting office space from KARD, on a month to month basis for $900 per month.  At December 31, 2012 and June 30, 2012, payables of $54,900 and $49,500 to KARD were included in accrued expenses, respectively. For the three and six months ended December 31, 2012 and 2011 and the period June 20, 2007 (date of inception) through December 31, 2012, the Company has included $2,700, $5,400, $2,700, $5,400, and $54,900 in general and administrative expenses, respectively.

Clinical Studies

As of September 28, 2007 the Company engaged KARD to conduct specified pre-clinical studies necessary for the Company to prepare an IND submission to the FDA.  The Company does not have an exclusive arrangement with KARD.  All work performed by KARD must have prior approval by the executive officers of the Company, and the Company retains all intellectual property resulting from the services by KARD. For the three and six months ended December 31, 2012 and 2011 and the period June 20, 2007 (date of inception) through December 31, 2012, the Company incurred $0, $0, $0, $9,990, and $2,601,110 of research and development expenses conducted by KARD, respectively.  At December 31, 2012 and June 30, 2012 the Company has included a total of $1,685,515 and $1,685,515 in accounts payable to Kard respectively.

7.           Due To Officer

During the year ended June 30, 2010, Mr. Ehrlich, an officer of the Company, converted previous amounts provided in cash to the Company of $32,310 into a loan (the “Ehrlich Promissory Note A”).   The Ehrlich Promissory Note A was an unsecured, 6% per annum simple interest bearing, demand note.  During the same period, Mr. Ehrlich provided an additional $85,000 in cash in the form of a loan to the Company (the “Ehrlich Promissory Note B”).  The Ehrlich Promissory Note B was an unsecured, 6% per annum simple interest bearing, demand note.

During the year ended June 30, 2010, Mr. Ehrlich, loaned the Company a total of $972,907.  A condition for this loan was that the Ehrlich Promissory Note A and Ehrlich Promissory Note B be replaced with a new note, Ehrlich Promissory Note C.  The Ehrlich Promissory Note C is an unsecured demand note that bears 9% simple interest per annum and is convertible into the Company’s common stock at $0.50 per share.  The note requires that the interest rate on the amounts due on Ehrlich Promissory Notes A and B be changed retroactively, beginning October 1, 2009, to 9%.   During the year ended June 30, 2011, Mr. Ehrlich loaned the Company an additional $997,047 which brought the balance of the demand note to $2,002,264.  On April 1, 2011, the Company amended the Ehrlich Promissory Note C and agreed to retroactively convert accrued interest of $96,677 through December 31, 2010 into additional principal.

On May 8, 2012, in connection with the renegotiation of an outstanding loan to Mr. Ehrlich, the Company issued 2,000,000 Equity Incentive Options exercisable at $0.51 per share equal to 110% of the closing bid price of $0.46 per share on May 7, 2012. Options are valid for ten (10) years from the date of issuance.

 At December 31, 2012, $357,665 is accrued as interest expense on this note. As of December 31, 2012, the balance of the demand note is $2,022,264 

8.   Stock Options and Warrants:

On April 1, 2009, the Company entered into an agreement, subsequently amended, with a Consultant to assist the Company’s Chief Scientific Officer to organize, manage and display data from animal studies as well as information relating to Active Pharmaceutical Ingredients and formulations of the Company’s products through November 2010. The Consultant was compensated at the rate of $4,000 per month payable on the last day of each month. In addition, at the end of each month of services provided, the Consultant is granted options to purchase 10,000 shares of Company’s common stock.  Effective September 1, 2010, the Company has extended the current agreement and beginning in August 2010, the monthly fee was increased to $5,000.  The remainder of the agreement remains unchanged.  As of December 31, 2012, the Consultant has been awarded a total of 450,000 options to purchase common stock valued at $233,918 to be vested over one year from date of issuance.  For the three and six months ended December 31, 2012, the Company has expensed $91,564, and $109,324 to professional fees expense, related to these options and remeasurement at December 31, 2012.

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The fair value of each option for the six months ended December 31, 2012 and 2011 was estimated on the date of grant or grant modification using the Black Scholes model that uses assumptions noted in the following table.

	Six Months Ended December 31, 2012			Six Months Ended December 31, 2011
Expected term (in years)		5-10			3-10
Expected stock price volatility		134.22% - 137.33	%		143.45%-148.15	%
Risk-free interest rate		1.53% - 1.75	%		1.98%-3.00	%
Expected dividend yield		0	%		0	%

On April 5, 2009 the Board of Directors of the Registrant adopted the 2009 Stock Option Plan (“the Plan”). The Plan permits the grant of 2,000,000 shares of both Incentive Stock Options (“ISOs”), intended to qualify under section 422 of the Code, and Non-Qualified Stock Options.

Under the 2010 Equity Incentive Plan the  total number of shares of Common Stock reserved and available for issuance under the Plan shall be 45,000,000 shares. Shares of Common Stock under the Plan (“Shares”) may consist, in whole or in part, of authorized and unissued shares or treasury shares. The term of each Stock Option shall be fixed by the Committee; provided, however, that an Incentive Stock Option may be granted only within the ten-year period commencing from the Effective Date and may only be exercised within ten years of the date of grant (or five years in the case of an Incentive Stock Option granted to an optionee who, at the time of grant, owns Common Stock possessing more than 10% of the total combined voting power of all classes of voting stock of the Company (“10%Shareholder”).

Stock Options

The following table summarizes all stock option activity:

	Number of Options		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Years)		Aggregate Intrinsic Value
Outstanding at June 30, 2012		41,277,500	$	0.14		8.46	$	21,186,225
Granted		90,000		0.85		8.09		---
Exercised		(2,250,000)		0.12		—		—
Forfeited/expired		—		—		—		—
Outstanding at December 31, 2012		39,117,500	$	0.14		7.97	$	66,131,775
Exercisable at December 31, 2012		39,052,500	$	0.14		7.95	$	66,070,958

The Company recognized $137,818, $214,165, $616,674, 1,246,444, and $6,903,282 of stock based compensation costs related to stock and stock option awards for the three and six months ended December 31, 2012 and 2011 and the period from inception to December 31, 2012, respectively, and there is $57,898 of unamortized compensation cost expected to be recognized through December 31, 2013.  

As of December 31, 2012, there were 6,312,084 warrants issued and outstanding with a weighted average exercise price of $0.84.  Of these warrants, 2,964,000 warrants were to expire in September 2010, however in September 2010; the Company approved the extension of these warrants to December 31, 2013. 

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During the months of October, November and December 2011, warrants to purchase 2,500,000 shares of the Company’s Class A common stock were issued to an investor pursuant to his purchase of 2,500,000 shares of the Company’s Class A common stock at $0.40 per share. Under ASC 815-40-25, the fair value of these warrants should be reported as a liability, Pursuant to the Warrant Agreement, because there is currently no effective registration statement covering the shares of common stock underlying these warrants, these warrants are currently subject to a cashless exercise whereby the warrant holders may surrender their warrants to the company in exchange for shares of common stock. The number of shares of common stock into which a warrant would be exchangeable in such a cashless exercise depends on both the exercise price of the warrants and the market price of the common stock, each at or near the time of exercise. Because both of these factors are variable, it is possible that the company could have insufficient authorized shares to satisfy a cashless exercise. In this scenario, if the company were unable to obtain shareholder approval to increase the number of authorized shares, the company could be obligated to settle such a cashless exercise with cash rather than by issuing shares of common stock. Further, ASC 815-40-25 requires that we record the potential settlement obligation at each reporting date using the current estimated fair value of the warrants, with any changes being recorded through our statement of operations. The warrants were valued at $417,608 at the time of issuance and recorded as a liability. At December 31, 2011, the warrants were valued at $1,327,500 and the warrant liability was increased by $909,892. On January 12, 2012, the subscription agreement was modified to remove the cashless exercise provision, and provide for “piggy-back” registration rights. The warrants were valued as of January 12, 2012 and the value reduced by $470,000.  The remaining $857,000 of warrant value was reclassified from a liability to equity.  As of September 30, 2012, these 2,500,000 warrants are outstanding with an exercise price of $1.00 and expire in October, November and December 2014.

On August 1, 2012, warrants to purchase 153,061 shares of the Company’s Class A common stock were issued to an investor pursuant to the conversion of 7,500 shares of Series A Convertible Preferred Stock into 153,061 shares of the Company’s Class A common stock at $0.49 per share of common stock.  The exercise price of the warrants is $0.49 per share.

On August 23, 2012, warrants to purchase 154,639 shares of the Company’s Class A common stock were issued to an investor pursuant to the conversion of 7,500 shares of Series A Convertible Preferred Stock into 154,639 shares of the Company’s Class A common stock at $0.485 per share of common stock.  The exercise price of the warrants is $0.485 per share.

On September 19, 2012, warrants to purchase 142,315 shares of the Company’s Class A common stock were issued to an investor pursuant to the conversion of 7,500 shares of Series A Convertible Preferred Stock into 142,315 shares of the Company’s Class A common stock at $0.527 per share of common stock.  The exercise price of the warrants is $0.527 per share.

On September 24, 2012, warrants to purchase 142,315 shares of the Company’s Class A common stock were issued to an investor pursuant to the conversion of 7,500 shares of Series A Convertible Preferred Stock into 142,315 shares of the Company’s Class A common stock at $0.527 per share of common stock.  The exercise price of the warrants is $0.527 per share.

9.           Equity Transactions

On May 8, 2012, the Company entered into a subscription agreement for Series A Convertible Preferred shares with an accredited investor for an aggregate of $1,000,000.  The subscription agreement provides for installment funding Amounts, at Cellceutix’s discretion, to take place every thirty days after initial closing date  for an amount of the lesser of  (i) $75,000 or  (ii) twenty five  (25%) per cent of the dollar value of the total volume traded during the preceding 22 trading days.   The Series A Preferred Shares are convertible into common stock at the lesser of 85% of the closing bid price on the date of prior to each closing, or 85% of the lowest bid price for the fifteen (15) days prior to conversion.  At no time may a holder of shares of Series A Preferred Stock convert shares of the Series A Preferred Stock if the number of shares of Common Stock to be issued pursuant to such conversion would exceed, when aggregated with all other shares of Common Stock owned by such holder at such time, the number of shares of Common Stock which would result in such holder beneficially owning more than 9.99% of all of the Common Stock outstanding.Additionally, for each common share issued upon conversion of Series A preferred share, a five year common stock purchase warrant is issued to the Subscriber.  The warrant is exercisable at the conversion price of the common shares issued.  The fair value of the common stock into which the Series A Preferred Stock is convertible will exceed the price at which the common stock will be issued on the date of issuance of the preferred stock.  The amount by which the fair value of the common stock exceeds the issue price of the common stock is a beneficial conversion feature.  The Company will recognize the beneficial conversion feature as a one-time, non-cash deemed dividend to the holders of the Series A Preferred Stock on the date of issuance, which is the date the preferred stock first became convertible.   The Series A Convertible Preferred shares do not pay dividends.   The Common shares underlying the Series A Preferred Shares and the common stock purchase warrants are subject to piggy back registration rights. The Agreement was mutually terminated between the parties on January 8, 2013.

On July 3, 2012 a tranche funding was made to purchase Series A Convertible Preferred shares in the amount of seventy five thousand dollars ($75,000) for the purchase 7,500 Series A Convertible Preferred Shares. 

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On June 25, 2012 the subscriber converted 10,000 Preferred Shares equal to $100,000 face value at $0.39 per share based on 85% of the closing bid price on May 7, 2012 of $0.46.   The company issued to the subscriber 255,754 shares of Cellceutix common stock.  In connection thereto the Company issued 255,754 warrants to purchase common shares of Cellceutix Corporation at $0.39 per share valid for five years.

On July 30, 2012, a tranche funding was made to purchase Series A Convertible Preferred shares in the amount of seventy five thousand dollars ($75,000) for the purchase 7,500 Series A Convertible Preferred Shares.

On August 1, 2012 the Series A Convertible Preferred subscriber converted 7,500 Preferred Shares equal to $75,000 face value at $0.49 per share based on 85% of the closing bid price on July 25, 2012 of $0.59.   The company issued to the subscriber 153,061 shares of Cellceutix common stock.  In connection thereto the Company issued 153,061warrants to purchase common shares of Cellceutix Corporation at $0.49 valid for five years.   The shares and the warrants are subject to piggy back registration rights.

On August 23, 2012 the Series A Convertible Preferred subscriber converted 7,500 Preferred Shares equal to $75,000 face value at $0.485 per share based on 85% of the closing bid price on August 14, 2012 of $0.571.   The company issued to the subscriber 154,639 shares of Cellceutix common stock.  In connection thereto the Company issued 154,639 warrants to purchase common shares of Cellceutix Corporation at $0.485 valid for five years.

On August 31, 2012 a tranche funding was made to purchase Series A Convertible Preferred shares in the amount of $75,000 USD for the purchase of 7,500 Series A Convertible Preferred Shares.  

On September 19, 2012 the Series A Convertible Preferred subscriber converted 7,500 Preferred Shares equal to $75,000 face value at $0.527 per share based on 85% of the closing bid price on August 31, 2012 at $0.62.   The company issued to the subscriber 142,315 shares of Cellceutix common stock.  In connection thereto the Company issued 142,315 warrants to purchase common shares of Cellceutix Corporation at $0.527 valid for five years.   The shares and the warrants are subject to piggy back registration rights.

On September 20, 2012 a tranche funding was made to purchase Series A Convertible Preferred shares in the amount of $75,000 USD for the purchase of 7,500 Series A Convertible Preferred Shares.

On September 24, 2012 the subscriber converted 7,500 Preferred Shares equal to $75,000 face value at $0.527 per share based on 85% of the closing bid price on August 31, 2012 of $0.62.  The company issued to the subscriber 142,315 shares of Cellceutix common stock.  In connection thereto the Company issued 142,315 warrants to purchase common shares of Cellceutix Corporation at $0.527 valid for five years.   The shares and the warrants are subject to piggy back registration rights.

The shares and the warrants of the above fundings, and all subsequent fundings pursuant to Series A Convertible Preferred shares, are subject to piggy back registration rights.

On September 7, 2012 a consultant exercised their option to purchase 250,000 shares of Class A common shares at $0.20, resulting in a payment to the Company of $50,000 and the issuance of 250,000 shares of Class A common stock.

On October 24, 2012 the Company issued a total of 50,000 Class A common shares to consultants for services through December 31, 2012, valued at $43,500 based on the closing bid price as quoted on the OTC Bulletin Board on October 23, 2012 at $.87 per share. 

On December 19, 2012 the Company issued  320,000 Class A common shares par value $.0001 to a consultant upon exercise of stock options granted to him  pursuant to the Company’s 2009 and 2010 Equity Incentive Plans of which  80,000 were granted on March 2, 2009, exercisable at $0.14 per share; 200,000 were granted on February 8, 2011, exercisable at $0.20 per share; and 40,000 were granted on February 17, 2011 exercisable at $.20 per share.  The Company received $59,200.  

On December 21, 2012 the Company issued 1,680,000 Class A common shares to a consultant upon exercise of Stock Options granted on December 29, 2010 under the Company’s 2010 Equity Incentive Plan and exercisable  at $0.10 per share.    The Company received $168,000.  

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On December 6, 2012 , the Company entered into a Class A Common Stock Purchase Agreement with Aspire Capital Fund, LLC, which provides that upon meeting the terms of the agreement, Aspire Capital is committed to purchase up to an aggregate of $10,000,000 million of our shares of Class A Common Stock over the approximately 36-month term of the Purchase Agreement. In consideration for entering into the Purchase Agreement, the Company issued to Aspire Capital 336,625 shares of our Class A Common Stock as a commitment fee and sold to Aspire Capital 112,208 shares of Class A Common Stock for $100,000. The commitment fee will be amortized as the funding is received. The unamortized portion is carried on the balance sheet as deferred offering costs.

Concurrently with entering into the Purchase Agreement, the Company agreed to file one or more registration statements as permissible and necessary under the Securities Act of 1933, as amended, or the Securities Act, for the sale of shares of our Class A Common Stock that have been and may be issued to Aspire Capital under the Purchase Agreement. On January 22, 2012, the Company filed a Form S-3 registration statement. The Company does not have the right to commence any sales of its shares to Aspire Capital until the SEC has declared the registration statement effective. Thereafter, on every and any business day selected by the Company, the Company shall have the right to direct Aspire Capital Fund to purchase (each such purchase, a “Regular Purchase”), up to 100,000 shares on each and any business day chosen by the Company; however, in any event, the amount of a Regular Purchase will not exceed $500,000 per business day. The purchase price for Regular Purchases (the “Regular Purchase Price”), shall be equal to the lesser of: (i) the lowest sale price of the shares on the purchase date, or (ii) the average of the three (3) lowest closing sale prices of the shares during the twelve (12) business days prior to the purchase date. The Regular Purchase Price will be known at the time of notice and before any shares are sold to Aspire Capital Fund.

In addition to the Regular Purchases, with one day’s prior written notice, the Company shall also have the right to require the ACF Investor to purchase up to an additional 20% of the trading volume of the shares for the next business day at a purchase price (the “VWAP Purchase Price”), equal to the lesser of: (i) the closing sale price of the shares on the purchase date, or (ii) ninety-five percent (95%) of the next business day’s volume weighted average price (each such purchase, a “VWAP Purchase”). The Company shall have the right, in its sole discretion, to determine a maximum number of shares and set a minimum market price threshold for each VWAP Purchase. The Company can only require a VWAP Purchase if (a) the closing sale price for the Company Class A common shares on the notice day for the VWAP Purchase is higher than $0.50, and (b) the Company has also submitted a Regular Purchase on the notice date for the VWAP Purchase. There are no limits on the number of VWAP Purchases that the Company may require.

Aspire Capital Fund has no right to require any sales by the Company, but is obligated to make purchases from the Company as the Company directs it in accordance with the Purchase Agreement. The Company can also accelerate the amount of Class A Common Stock to be purchased under certain circumstances. There are no limitations on use of proceeds, financial or business covenants, restrictions on future funding, rights of first refusal, participation rights, penalties or liquidated damages in the Purchase Agreement.

The Company is never under any obligation to sell shares to Aspire Capital Fund. Aspire Capital Fund has no rights to require the Company to sell shares.

 Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion of the Company’s financial condition and the results of operations should be read in conjunction with the Financial Statements and Notes thereto appearing elsewhere in this document.

The Private Securities Litigation Reform Act of 1995 provides a safe harbor for forward-looking statements. In order to comply with the terms of the safe harbor, the Company notes that in addition to the description of historical facts contained herein, this report contains certain forward-looking statements that involve risks and uncertainties as detailed herein and from time to time in the Company’s other filings with the Securities and Exchange Commission and elsewhere. Such statements are based on management’s current expectations and are subject to a number of factors and uncertainties, which could cause actual results to differ materially from those, described in the forward-looking statements. These factors include, among others: (a) the Company’s fluctuations in sales and operating results; (b) risks associated with international operations; (c) regulatory, competitive and contractual risks; (d) product development risks; (e) the ability to achieve strategic initiatives, including but not limited to the ability to achieve sales growth across the business segments through a combination of enhanced sales force, new products, and customer service; and (f) pending litigation.

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Management’s Plan of Operation

We acquired exclusive rights to a total of eight (8) pharmaceutical compound candidates that are designed for treatment of diseases which may be either existing or diseases identified in the future. The Company has spent most of its efforts and resources on its anti-cancer compound, Kevetrin, for the treatment of certain cancers, and on Prurisol, for the treatment of psoriasis. Based on the experimental studies results to date, the Company has decided to advance these drugs along the regulatory and clinical pathway. We anticipate using our expertise to manage and perform what we believe are the most critical aspects of the product development process which include: (i) the design and oversight of clinical trials; (ii) the development and execution of strategies for the protection and maintenance of intellectual property rights; and (iii) the interaction with regulatory authorities internationally. We expect to concentrate on product development and engage in a limited way in product discovery, avoiding the significant investment of time and financial resources that is generally required before a compound is identified and brought into clinical trials. 

We have recently transitioned to a clinical stage company. On June 21, 2012, the U.S. Food and Drug Administration ("FDA") approved the Investigational New Drug (IND) application for Kevetrin™, Cellceutix's novel anti-cancer compound. The Phase 1 trials are being conducted at Harvard Cancer Center's Dana-Farber Cancer Institute and partner Beth Israel Deaconess Medical Center.  The clinical trial will test Kevetrin against a variety of different solid tumor cancer types in patients with advanced-stage cancers. Primary endpoints for the study will be safety, tolerable dosing levels and establishing the dose for a future Phase II clinical trial. Presently, we are at the early stage of the trial. The Company has received no notice of events outside of the parameters of the protocol and the trial is progressing. The trial is registered on www.clinicaltrials.gov. http://clinicaltrials.gov/ct2/show/NCT01664000?term=Kevetrin&rank=1

Kevetrin has demonstrated the potential for a major breakthrough in cancer research by exhibiting an activation of p53 in both wild and mutant types of p53. p53, often referred to as the “Guardian Angel Gene” or the “Guardian Angel of the Human Genome” due its crucial role in controlling cell mutations, is a tumor suppressor protein that is encoded by the TP53 gene in humans and has been widely regarded as possibly holding a key to the future of cancer therapies. Additional studies have shown that Kevetrin has potent anticancer activity in a wide range of tumor types by targeting histonedeacetylase (HDAC).

In March 2012, we entered into an agreement with Beth Israel Deaconess Medical Center (BIDMC), a teaching hospital of Harvard Medical School, on an innovative research project with Kevetrin. The Medical Center wishes to exploit the nuclear and/or mitochondrial pro-apoptotic function of p53 in melanoma and renal cell carcinoma, two types of cancer that are particularly resistant to therapy. BIDMC hopes to improve therapy for melanoma and renal cell carcinoma, cancers that are particularly resistant to therapy. 

BIDMC initiated combination studies with multikinase inhibitors which activate pro-apoptotic activity by translocation of p53 in mitochondria thereby inducing apoptosis. Apoptosis is enhanced by MDM2 inhibitors by stabilizing p53. As presented at the American Association for Cancer Research (AACR) meeting in April, Kevetrin phosphorylates MDM2 which activates and stabilizes p53 by monoubiquitination inducing apoptosis. Prior data from the BIDMC laboratory showed that agents of this class can augment the pro-apoptotic and antitumor effects of MDM2 antagonists and is expected to have a synergistic effect with Kevetrin. BIDMC will test the effects of Kevetrin alone and in combination with FDA-approved VEGFR antagonists in the renal cell carcinoma and melanoma studies. In vitro study endpoints include apoptosis by measuring caspase activation and PARP cleavage. In vivo endpoints include efficacy in a xenograft model, tumor vascularity, p53 levels, p21 expression and apoptosis. This study will provide vital insight to exploit the nuclear and/or mitochondrial pro-apoptotic function by Kevetrin in combination with other multikinase inhibitors in treatment of these difficult to treat malignancies. At this time the study is in progress. Results of these preclinical tests provided to date to the Company are encouraging and BIDMC and Cellceutix wish to move the study further. Cellceutix has provided the requested information from BIDMC that will be used to investigate a Specialized Programs of Research Excellence (SPORE) grant for a phase 2 clinical study of renal cancer.

The University of Bologna in Italy (the “University”) and The Italian Cooperative Study Group on Chronic Myeloid Leukemia (ICSG on CML) and Acute Leukemia (GIMEMA Group) plan on testing Kevetrin against Acute Myelogenous Leukemia (AML). We have been advised that the study, a phase 1b trial, will be titled “A Multi-Center, Open-Label, Phase 1B Study of Escalating Doses of Kevetrin (Thioureidobutyronitrile) Administered Intravenously, with Cytarabine Adminstered A) Subcutaneously, or B) Intravenously, in Patients with Acute Myelogenous Leukemia (AML).” The study is scheduled to begin in the first half of 2013. The University will source the funding for this trial.

The Company is presently in discussions with other institutions for collaborations in conducting clinical trials with Kevetrin on multiple cancers.

On December 25, 2012 the United States Patent and Trademark Office (USPTO) awarded the Company U.S. Patent No. 8,338,454 B2, titled "Nitrile Derivatives and their Pharmaceutical Use and Compositions." The patent covers pharmaceutical compositions comprising Kevetrin™, and related compounds and compositions.

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Prurisol is our anti-psoriasis drug candidate. It is a small molecule with a molecular weight of less than 500 MW. It is synthesized through a multi step-step process using commercially available starting materials. Prurisol acts through immune modulation and PRINS reduction.

In June 2012, we participated in a pre IND meeting with the U.S. Food and Drug Administration ("FDA") pertaining to Prurisol™ our compound targeting psoriasis. Cellceutix had requested the meeting for guidance on its initiatives to seek a section 505(b)(2) designation for Prurisol™, which would allow the us to forgo early-stage trials and advance Prurisol™ into latter-stage clinical trials.  Cellceutix was advised by the FDA that a 505(b)(2) application would be an acceptable approach for Prurisol.

We plan to sponsor a Phase II/III Proof of Concept trial in Europe that is on target to begin late first quarter/early second quarter 2013. This will be a relatively short trial with only 30 days of treatment and 30 days of follow-up to evaluate the efficacy and safety of Prurisol. Our manufacturer, Dr. Reddy’s Laboratories Ltd., has advised us that the manufacturing of Prurisol is planned to begin in February.

At this time the Company is focusing its research and development efforts exclusively on Kevetrin and Prurisol.

We have no product sales to date and we will not receive any product revenue until we receive approval from the FDA or equivalent foreign regulatory bodies to begin selling our pharmaceutical candidates. Developing pharmaceutical products, however, is a lengthy and very expensive process. Assuming we do not encounter any unforeseen safety issues during the course of developing our product candidates, we do not expect to complete the development of a product candidate for several years, if ever.

Liquidity and Capital Resources

As of December 31, 2012 the Company had a cash balance of $222,862.  The Company will need to raise substantial funds in order to execute its product development plan.  The Company has entered into a financing agreement with Aspire Capital Fund for $10,000,000. We do not have the right to commence any sales of our shares to Aspire Capital Fund until the SEC has declared the registration statement filed on , effective. (SEE BELOW) Based upon our expected rate of expenditures, we currently do not have sufficient cash reserves to meet all of our anticipated obligations through our fiscal year end of June 30, 2013. 

On May 8, 2012, the Company entered into a subscription agreement for Series A Convertible Preferred shares with an accredited investor for an aggregate of $1,000,000.  The Subscription Agreement provides for installment funding Amounts, at Cellceutix’s discretion, to take place every thirty days after initial closing date for an amount of the lesser of  (i) $75,000 or  (ii) twenty five  (25%) per cent of the dollar value of the total volume traded during the preceding 22 trading days.   The Series A Preferred Shares are convertible into common stock at the lesser of 85% of the closing bid price on the date of prior to each closing, or 85% of the lowest bid price for the fifteen (15) days prior to conversion.  At no time may a holder of shares of Series A Preferred Stock convert shares of the Series A Preferred Stock if the number of shares of Common Stock to be issued pursuant to such conversion would exceed, when aggregated with all other shares of Common Stock owned by such holder at such time, the number of shares of Common Stock which would result in such holder beneficially owning more than 9.99% of all of the Common Stock outstanding. Additionally, for each common share issued upon conversion of Series A preferred share, a five year common stock purchase warrant is issued to the Subscriber.  The warrant is exercisable at the conversion price of the common shares issued.  The fair value of the common stock into which the Series A Preferred Stock is convertible will exceed the price at which the common stock will be issued on the date of issuance of the preferred stock.  The amount by which the fair value of the common stock exceeds the issue price of the common stock is a beneficial conversion feature.  The Company will recognize the beneficial conversion feature as a one-time, non-cash deemed dividend to the holders of the Series A Preferred Stock on the date of issuance, which is the date the preferred stock first became convertible.   The Series A Convertible Preferred shares do not pay dividends.   The Common shares underlying the Series A Preferred Shares and the common stock purchase warrants are subject to piggy back registration rights. As of December 31, 2012 a total of $400,000 Series A Convertible Preferred shares were subscribed too and there remained a balance of $600,000 for the Company to draw upon in installment funding per the agreement.   The Agreement was mutually terminated between the parties on January 8, 2013.

On December 6, 2012 , we entered into a Class A Common Stock Purchase Agreement with Aspire Capital Fund, LLC, which provides that upon meeting the terms of the agreement, Aspire Capital is committed to purchase up to an aggregate of $10,000,000 million of our shares of Class A Common Stock over the approximately 36-month term of the Purchase Agreement. In consideration for entering into the Purchase Agreement, we issued to Aspire Capital 336,625 shares of our Class A Common Stock as a commitment fee and sold to Aspire Capital 112,208 shares of Class A Common Stock for $100,000. Concurrently with entering into the Purchase Agreement, we agreed to file one or more registration statements as permissible and necessary under the Securities Act of 1933, as amended, or the Securities Act, for the sale of shares of our Class A Common Stock that have been and may be issued to Aspire Capital under the Purchase Agreement. On January 22, 2012, the Company filed a Form S-3 registration statement.

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We do not have the right to commence any sales of our shares to Aspire Capital until the SEC has declared the registration statement effective. Thereafter, on every and any business day selected by the Company, the Company shall have the right to direct Aspire Capital Fund to purchase (each such purchase, a “Regular Purchase”), up to 100,000 shares on each and any business day chosen by the Company; however, in any event, the amount of a Regular Purchase will not exceed $500,000 per business day. The purchase price for Regular Purchases (the “Regular Purchase Price”), shall be equal to the lesser of: (i) the lowest sale price of the shares on the purchase date, or (ii) the average of the three (3) lowest closing sale prices of the shares during the twelve (12) business days prior to the purchase date. The Regular Purchase Price will be known at the time of notice and before any shares are sold to Aspire Capital Fund.

In addition to the Regular Purchases, with one day’s prior written notice, the Company shall also have the right to require the ACF Investor to purchase up to an additional 20% of the trading volume of the shares for the next business day at a purchase price (the “VWAP Purchase Price”), equal to the lesser of: (i) the closing sale price of the shares on the purchase date, or (ii) ninety-five percent (95%) of the next business day’s volume weighted average price (each such purchase, a “VWAP Purchase”). The Company shall have the right, in its sole discretion, to determine a maximum number of shares and set a minimum market price threshold for each VWAP Purchase. The Company can only require a VWAP Purchase if (a) the closing sale price for the Company Class A common shares on the notice day for the VWAP Purchase is higher than $0.50, and (b) the Company has also submitted a Regular Purchase on the notice date for the VWAP Purchase. There are no limits on the number of VWAP Purchases that the Company may require.

Aspire Capital Fund has no right to require any sales by us, but is obligated to make purchases from us as we direct in accordance with the Purchase Agreement. We can also accelerate the amount of Class A Common Stock to be purchased under certain circumstances. There are no limitations on use of proceeds, financial or business covenants, restrictions on future funding, rights of first refusal, participation rights, penalties or liquidated damages in the Purchase Agreement.

The Company is never under any obligation to sell shares to Aspire Capital Fund. Aspire Capital Fund has no rights to require the Company to sell shares.

Requirement for Additional Capital  

Research and Development Costs.  The Company has engaged in limited research and development activities. We currently do not have sufficient funds to meet our planned drug development for the next twelve (12) months and we may not be able to obtain the necessary financing on terms and conditions acceptable to the Company. Assuming that we are successful in raising additional financing, we plan to incur the following expenses over the next twelve (12) months: 

1. Research and Development- $2,000,000 in preclinical development costs, including testing Kevetrin on additional tumors and costs to manufacture Prurisol.

2. Clinical trials – $3,000,000.  We have budgeted $1,500,000 for our Phase 1 Kevetrin trials and $1,500,000 for the Prurisol pilot study and phase 2/3 trials.

3. Corporate overhead of $1,250,000: Budgeted office salaries, legal, accounting and other costs expected to be incurred.

4. Capital costs of $100,000: Estimated cost for equipment and laboratory improvements.

The Company will be unable to proceed with its full planned drug development program (s), meet its administrative expense requirements, capital costs, or staffing costs without obtaining additional financing of approximately  $6,350,000 (as per current management’s budgets). The Company has entered into a $10,000,000 financing agreement with Aspire Capital Fund. We do not have the right to commence any sales of our shares to Aspire Capital until the SEC has declared the registration statement effective. (SEE Liquidity and Capital Resources) If the SEC doesn’t declare our registration effective, or we are unable to obtain additional financing on terms and conditions acceptable to the Company, our business plan will be significantly delayed. 

Off-Balance Sheet Arrangements.

The Company does not have any off-balance sheet arrangements, as defined in Item 304(a)(4)(ii) of Regulation S-K under the Securities Exchange Act of 1934, as amended.

Item 3.  Quantitative and Qualitative Disclosures About Market Risk

Not applicable

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Item 4.  Controls and Procedures

The Company’s Chief Executive Officer and Chief Financial Officer have evaluated the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of December 31, 2012 covered by this Quarterly Report on Form 10-Q.  Based upon such evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of such period, the Company’s disclosure controls and procedures were not effective as required under Rules 13a-15(e) and 15d-15(e) under the Exchange Act. This conclusion by the Company’s Chief Executive Officer and Chief Financial Officer does not relate to reporting periods after December 31, 2012.

Changes in Internal Control over Financial Reporting

No change in the Company’s internal control over financial reporting occurred during the quarter ended  December 31,  2012, that materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

Cellceutix Corporation has entered into a settlement agreement with a former vendor Toxikon Corporation, settling all claims asserted by Toxikon in a civil action filed by Toxikon Corporation in the Commonwealth of Massachusetts.  Cellceutix Corporation has agreed to pay Toxikon Corporation ninety-thousand ($90,000.00) dollars prior to March 1, 2013 in full settlement of the claims asserted and the amount has been recorded on the balance sheet as of December 31, 2012.

Formatech is a former vendor of ours which had received Cellceutix common stock and had also gone bankrupt. In July 2012, Cellceutix was advised that a US Bankruptcy Court judge has allowed Formatech’s bankruptcy trustee to sell 184,375 restricted shares of Cellceutix Class A Common Stock. The proceeds of any sales of these shares will be held in escrow pending the outcome of Cellceutix’s claims against Formatech. Cellceutix has engaged an attorney with the aim of recovering these funds.

Item 2. Unregistered sales of equity securities

On May 8, 2012, the Company entered into a subscription agreement for Series A Convertible Preferred shares with an accredited investor for an aggregate of $1,000,000.  The subscription agreement provides for installment funding Amounts, at Cellceutix’s discretion, to take place every thirty days after initial closing date  for an amount of the lesser of  (i) $75,000 or  (ii) twenty five  (25%) per cent of the dollar value of the total volume traded during the preceding 22 trading days.   The Series A Preferred Shares are convertible into common stock at the lesser of 85% of the closing bid price on the date of prior to each closing, or 85% of the lowest bid price for the fifteen (15) days prior to conversion.  At no time may a holder of shares of Series A Preferred Stock convert shares of the Series A Preferred Stock if the number of shares of Common Stock to be issued pursuant to such conversion would exceed, when aggregated with all other shares of Common Stock owned by such holder at such time, the number of shares of Common Stock which would result in such holder beneficially owning more than 9.99% of all of the Common Stock outstanding.Additionally, for each common share issued upon conversion of Series A preferred share, a five year common stock purchase warrant is issued to the Subscriber.  The warrant is exercisable at the conversion price of the common shares issued.  The fair value of the common stock into which the Series A Preferred Stock is convertible will exceed the price at which the common stock will be issued on the date of issuance of the preferred stock.  The amount by which the fair value of the common stock exceeds the issue price of the common stock is a beneficial conversion feature.  The Company will recognize the beneficial conversion feature as a one-time, non-cash deemed dividend to the holders of the Series A Preferred Stock on the date of issuance, which is the date the preferred stock first became convertible.   The Series A Convertible Preferred shares do not pay dividends.   The Common shares underlying the Series A Preferred Shares and the common stock purchase warrants are subject to piggy back registration rights.

On July 3, 2012 a tranche funding was made to purchase Series A Convertible Preferred shares in the amount of seventy five thousand dollars ($75,000) for the purchase 7,500 Series A Convertible Preferred Shares. 

On June 25, 2012 the subscriber converted 10,000 Preferred Shares equal to $100,000 face value at $0.39 per share based on 85% of the closing bid price on May 7, 2012 of $0.46.   The company issued to the subscriber 255,754 shares of Cellceutix common stock.  In connection thereto the Company issued 255,754 warrants to purchase common shares of Cellceutix Corporation at $0.39 per share valid for five years.

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On July 30, 2012, a tranche funding was made to purchase Series A Convertible Preferred shares in the amount of seventy five thousand dollars ($75,000) for the purchase 7,500 Series A Convertible Preferred Shares.

On August 1, 2012 the Series A Convertible Preferred subscriber converted 7,500 Preferred Shares equal to $75,000 face value at $0.49 per share based on 85% of the closing bid price on July 25, 2012 of $0.59.   The company issued to the subscriber 153,061 shares of Cellceutix common stock.  In connection thereto the Company issued 153,061 warrants to purchase common shares of Cellceutix Corporation at $0.49 valid for five years.   The shares and the warrants are subject to piggy back registration rights.

On August 23, 2012 the Series A Convertible Preferred subscriber converted 7,500 Preferred Shares equal to $75,000 face value at $0.485 per share based on 85% of the closing bid price on August 14, 2012 of $0.571.   The company issued to the subscriber 154,639 shares of Cellceutix common stock.  In connection thereto the Company issued 154,639 warrants to purchase common shares of Cellceutix Corporation at $0.485 valid for five years.

On August 31, 2012 a tranche funding was made to purchase Series A Convertible Preferred shares in the amount of $75,000 USD for the purchase of 7,500 Series A Convertible Preferred Shares.  

On September 19, 2012 the Series A Convertible Preferred subscriber converted 7,500 Preferred Shares equal to $75,000 face value at $0.527 per share based on 85% of the closing bid price on August 31, 2012 at $0.62.   The company issued to the subscriber 142,315 shares of Cellceutix common stock.  In connection thereto the Company issued 142,315 warrants to purchase common shares of Cellceutix Corporation at $0.527 valid for five years.   The shares and the warrants are subject to piggy back registration rights.

On September 20, 2012 a tranche funding was made to purchase Series A Convertible Preferred shares in the amount of $75,000 USD for the purchase of 7,500 Series A Convertible Preferred Shares.

On September 24, 2012 the subscriber converted 7,500 Preferred Shares equal to $75,000 face value at $0.527 per share based on 85% of the closing bid price on August 31, 2012 of $0.62.  The company issued to the subscriber 142,315 shares of Cellceutix common stock.  In connection thereto the Company issued 142,315 warrants to purchase common shares of Cellceutix Corporation at $0.527 valid for five years.   The shares and the warrants are subject to piggy back registration rights.

The shares and the warrants of the above fundings, and all subsequent fundings pursuant to Series A Convertible Preferred shares, are subject to piggy back registration rights.

On September 7, 2012 a consultant exercised their option to purchase 250,000 shares of Class A common shares at $0.20, resulting in a payment to the Company of $50,000 and the issuance of 250,000 shares of Class A common stock.

On October 24, 2012 the Company issued a total of 50,000 Class A common shares to consultants for services through December 31, 2012, valued at $43,500 based on the closing bid price as quoted on the OTC Bulletin Board on October 23, 2012 at $.87 per share. 

On December 19, 2012 the Company issued  320,000 Class A common shares par value $.0001 to a consultant upon exercise of stock options granted to him  pursuant to the Company’s 2009 and 2010 Equity Incentive Plans of which  80,000 were granted on March 2, 2009, exercisable at $0.14 per share; 200,000 were granted on February 8, 2011, exercisable at $0.20 per share; and 40,000 were granted on February 17, 2011 exercisable at $.20 per share.  The Company received $59,200.  

On December 21, 2012 the Company issued 1,680,000 Class A common shares to a consultant upon exercise of Stock Options granted on December 29, 2010 under the Company’s 2010 Equity Incentive Plan and exercisable  at $0.10 per share.    The Company received $168,000.  

Item 3. Defaults Upon Senior Securities

None

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Item 4.  Mine Safety Disclosures

None

Item 5.  Other Information

None

Item 6. Exhibits

(a) Exhibit index

Exhibit
31.1	Certification of Chief Executive Officer, Chief Financial Officer, Chief Accounting Officer  required by Rule 13a-14(a) or Rule 15d-14(a) under the Securities Exchange Act of 1934, as amended.
31.2	Certification of Chief Executive Officer, Chief Financial Officer, Chief Accounting Officer  required by Rule 13a-14(a) or Rule 15d-14(a) under the Securities Exchange Act of 1934, as amended.

 (b)  Reports on Form 8-K

(1)	The Company filed a Form 8-K on December 6, 2012 related to Item 1.01 Entry into a Material Definitive Agreement and Item 3.02 Unregistered Sales of Equity Securities with Aspire Capital Fund
(2)	The Company filed a Form 8-K on December 26, 2012 related to Item 3.02 Unregistered Sales of Equity Securities for option conversions into Class A Common Stock.
(3)	The Company filed a Form 8-K on December 27, 2012 related to Item 7.01. Regulation FD Disclosure that the Company signed a Confidential Disclosure Agreement with one of the world’s most prominent cancer centers in the United States for possible clinical trials funded by the hospital.
(4)	The Company filed a Form 8-K on December 27, 2012 related to Item 1.02  Termination of Material Definitive Agreement that the Company and the accredited investor mutually agreed to terminate the Series A Convertible Preferred Subscription Agreement of May 2012.
(5)	The Company filed a Form 8-K on December 26, 2013 related to Item 3.02 Unregistered Sales of Equity Securities for warrant conversions into Class A Common Stock.

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SIGNATURES

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

 CELLCEUTIX CORPORATION

/s/ Leo Ehrlich

 Leo Ehrlich, Chief Executive Officer and Chief Financial Officer and Chairman of the Board of Directors

(Principal Executive, Accounting and Financial Officer)

/s/ Krishna Menon

Krishna Menon,

President and Director

Dated: February 13, 2013                                                                                      

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EX-31

Exhibit 31-1

CERTIFICATION PURSUANT TO RULE 13a-14(a) OF THE SECURITIES EXCHANGE ACT OF 1934

I, Leo Ehrlich, certify that:

1.     I have reviewed this report on Form 10-Q of Cellceutix Corporation;

2.     Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.     Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.     The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a – 15(f) and 15d – 15(f)) for the registrant and we have:

a)     designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)     designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

c)     evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation; and

d)     disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

5.     The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the small business issuer 's auditors and the audit committee of registrant 's board of directors (or persons performing the equivalent function):

a)     all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect registrant 's ability to record, process, summarize and report financial information; and

b)     any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

CELLCEUTIX CORPORATION
Date:  February 13, 2013	By:	/s/ Leo Ehrlich
		Leo Ehrlich
		Chief Executive Officer, Chief Financial Officer,
		Chairman of the Board of Directors
		(Principal Executive, Accounting and Financial Officer)

EX-32

Exhibit 32-1

CERTIFICATION PURSUANT TO

18 U.S.C. §1350, AS

ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Leo Ehrlich, Interim Chief Executive Officer and Chief Financial  Officer of Cellceutix Corporation, hereby certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002:

(1)   the Quarterly Report on Form 10-Q of Cellceutix Corporation for the quarter ended December 31, 2012 as filed with the Securities and Exchange Commission on the date hereof, fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934; and

(2)    the information contained in the such Quarterly Report on Form 10-Q of Cellceutix Corporation for the quarter ended December 31, 2012 fairly presents, in all material respects, the financial condition and results of operations of Cellceutix Corporation

CELLCEUTIX CORPORATION
Date:  February 13, 2013	By:	/s/ Leo Ehrlich
	Leo Ehrlich
	Interim Chief Executive Officer, Chief Financial Officer,
	Chairman of the Board of Directors
	(Principal Executive, Accounting and Financial Officer)

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Stock Options and Warrants (Detail Textuals 6) (USD $)	1 Months Ended							1 Months Ended
	Sep. 19, 2012 Class A common stock	Sep. 24, 2012 Class A common stock	Aug. 23, 2012 Class A common stock	Aug. 01, 2012 Class A common stock	Dec. 31, 2012 Class A common stock	Jun. 30, 2012 Class A common stock	Jun. 25, 2012 Class A common stock	Sep. 19, 2012 Series Convertible Preferred Stock	Sep. 24, 2012 Series Convertible Preferred Stock	Aug. 23, 2012 Series Convertible Preferred Stock	Aug. 01, 2012 Series Convertible Preferred Stock	Sep. 30, 2012 Warrants	Sep. 24, 2012 Warrants	Sep. 19, 2012 Warrants	Aug. 23, 2012 Warrants	Aug. 01, 2012 Warrants	Jun. 25, 2012 Warrants	Dec. 31, 2011 Warrants	Nov. 30, 2011 Warrants	Oct. 31, 2011 Warrants
Class of Warrant or Right [Line Items]
Common stock purchased													142,315	142,315	154,639	153,061	255,754	2,500,000	2,500,000	2,500,000
Exercise price of warrants	0.527						0.39					1.00	0.527	0.527	0.485	0.49	0.39
Conversion of stock, shares issued	142,315	142,315	154,639	153,061				7,500	7,500	7,500	7,500
Price per share of common stock	$ 0.527	$ 0.527	$ 0.485	$ 0.49	$ 0.0001	$ 0.0001

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Stock Options and Warrants (Detail Textuals) (USD $)	3 Months Ended		6 Months Ended		66 Months Ended	1 Months Ended		3 Months Ended	6 Months Ended		6 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2012	Aug. 31, 2010 Stock Options	Apr. 30, 2009 Stock Options	Dec. 31, 2012 Stock Options	Dec. 31, 2012 Stock Options	Apr. 01, 2009 Stock Options	Dec. 31, 2012 Stock Options Consultants
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Compensation expenses per month										$ 4,000
Number of options granted							10,000		90,000
Monthly fees increased						5,000
Number of stock options awarded to consultant											450,000
Value of options granted to consultant											233,918
Vesting period for options granted to consultant											1 year
Professional fees related to stock options	$ 244,573	$ 225,230	$ 321,888	$ 357,321	$ 2,900,799			$ 91,564	$ 109,324

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Commitments and Contingencies (Detail Textuals 1) (USD $)	1 Months Ended			1 Months Ended	6 Months Ended
	Dec. 31, 2009	Jul. 31, 2009	Jul. 02, 2012 Compound	Jul. 30, 2012 Class A common stock	Dec. 31, 2012 Settlement Agreement Toxikon Corporation
Agreement [Line Items]
Payments for legal settlement					$ 90,000
Formatech's bankruptcy trustee sell restricted shares of Cellceutix Class A Common Stock				184,375
Number of pharmaceutical compounds			3
Percentage of net sales agreed to pay to inventors	4.50%	5.00%
Percentage of net sales agreed to pay to inventors of other countries	3.00%	3.00%
Agreed amount payable to investor	$ 10,000

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Equity Transactions (Detail Textuals 2) (Class A common stock, USD $)							1 Months Ended
	Dec. 31, 2012	Sep. 24, 2012	Sep. 19, 2012	Aug. 23, 2012	Aug. 01, 2012	Jun. 30, 2012	Oct. 24, 2012 Consultants
Class of Stock [Line Items]
Common stock issue to consultants for services (in shares)							50,000
Common stock issue to consultants for services							$ 43,500
Closing price of shares	$ 0.0001	$ 0.527	$ 0.527	$ 0.485	$ 0.49	$ 0.0001	$ 0.87

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Stock Options and Warrants (Detail Textuals 4) (Warrants)	6 Months Ended
	Dec. 31, 2012
Warrants
Class of Warrant or Right [Line Items]
Warrants issued and outstanding	6,312,084
Weighted Average Exercise Price Of Warrants	0.84
Warrants expired	2,964,000

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Financial Statements

6 Months Ended

Dec. 31, 2012

Organization, Consolidation and Presentation Of Financial Statements [Abstract]

Financial Statements

2.          Financial Statements

In the opinion of management, all adjustments consisting only of normal recurring adjustments necessary for a fair statement of (a) the results of operations for the three and six month periods ended December 31, 2012 and 2011, (b) the financial position at December 31, 2012 and (c) cash flows for the six month periods ended December 31, 2012 and 2011, have been made.  

The unaudited financial statements and notes are presented as permitted by Form 10-Q. Accordingly, certain information and note disclosures normally included in the financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been omitted. The accompanying financial statements and notes should be read in conjunction with the Company’s Form 10K for the fiscal year ended June 30, 2012.  The results of operations for the three and six month periods ended December 31, 2012 are not necessarily indicative of those to be expected for the entire year.    

The company has evaluated all subsequent events through the filing date of this form 10-Q with SEC, to ensure that this form 10-Q includes subsequent events that should be recognized in the financial statements as of December 31, 2012, and appropriate disclosure of subsequent events which were not recognized in the financial statements.

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Equity Transactions (Detail Textuals 3) (USD $)	6 Months Ended	66 Months Ended	1 Months Ended	6 Months Ended							0 Months Ended		1 Months Ended	0 Months Ended	1 Months Ended		1 Months Ended
	Dec. 31, 2012	Dec. 31, 2012	Apr. 30, 2009 Stock Options	Dec. 31, 2012 Stock Options	Dec. 31, 2012 Class A common stock	Sep. 24, 2012 Class A common stock	Sep. 19, 2012 Class A common stock	Aug. 23, 2012 Class A common stock	Aug. 01, 2012 Class A common stock	Jun. 30, 2012 Class A common stock	Sep. 07, 2012 Class A common stock Stock Options	Feb. 08, 2011 Equity Incentive Plans 2009 and 2010 Class A common stock Stock Options	Feb. 17, 2011 Equity Incentive Plans 2009 and 2010 Class A common stock Stock Options	Mar. 02, 2009 Equity Incentive Plans 2009 and 2010 Class A common stock Stock Options	Dec. 19, 2012 Equity Incentive Plans 2009 and 2010 Class A common stock Stock Options	May 02, 2009 Equity Incentive Plans 2009 and 2010 Class A common stock Stock Options	Dec. 21, 2012 Equity Incentive Plans 2010 Class A common stock Stock Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of options, Exercised				(2,250,000)							250,000				320,000		1,680,000
Common stock, par value (in dollars per share)					$ 0.0001	$ 0.527	$ 0.527	$ 0.485	$ 0.49	$ 0.0001					$ 0.0001
Options granted to consultant to purchase common stocks			10,000	90,000								200,000	40,000	80,000
Weighted average exercise price of options exercisable				$ 0.14								$ 0.20	$ 0.20			$ 0.14	$ 0.10
Amount received on Exercise of stock options	$ 277,200	$ 277,200													$ 59,200		$ 168,000

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Due To Officer (Detail Textuals) (USD $)				12 Months Ended		12 Months Ended		12 Months Ended
	Dec. 31, 2012	Jun. 30, 2012	Dec. 31, 2012 Convertible Notes Payable	Jun. 30, 2010 Convertible Notes Payable Ehrlich Promissory Note A	Oct. 01, 2009 Convertible Notes Payable Ehrlich Promissory Note A	Jun. 30, 2010 Convertible Notes Payable Ehrlich Promissory Note B	Oct. 01, 2009 Convertible Notes Payable Ehrlich Promissory Note B	Jun. 30, 2011 Convertible Notes Payable Ehrlich Promissory Note C	Jun. 30, 2010 Convertible Notes Payable Ehrlich Promissory Note C	Apr. 30, 2011 Convertible Notes Payable Ehrlich Promissory Note C
Debt Instrument [Line Items]
Unsecured Ehrlich Promissory Note - total amount				$ 32,310		$ 85,000		$ 997,047	$ 972,907
Simple interest bearing unsecured Ehrlich Promissory Note				6.00%		6.00%			9.00%
Common stock per share									$ 0.50
Percentage of interest rate change					9.00%		9.00%
Debt instrument accrued interest converted into additional principal										96,677
Note payable to officer	$ 2,022,264	$ 2,022,264	$ 2,022,264

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Related Party Transactions (Detail Textuals 1) (USD $)	3 Months Ended		6 Months Ended		66 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2012	Jun. 30, 2012
Related Party Transaction [Line Items]
Research and development, gross	$ 281,516	$ 106,964	$ 466,469	$ 209,866	$ 5,563,481
Accounts payable, related party payables	1,695,683		1,695,683		1,695,683	1,695,820
Kard Scientific
Related Party Transaction [Line Items]
Research and development, gross	0	0	0	9,990	2,601,110
Accounts payable, related party payables	$ 1,685,515		$ 1,685,515		$ 1,685,515	$ 1,685,515

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Equity Transactions (Detail Textuals 4) (Common Stock Purchase Agreement, USD $)	6 Months Ended		0 Months Ended
	Dec. 31, 2012	Dec. 31, 2012 Class A common stock	Dec. 06, 2012 Class A common stock Aspire Capital Fund LLC
Agreement [Line Items]
Common stock shares commited to purchase value			$ 10,000,000
Term of agreements			36 months
Shares issued as commitment fee (in shares)			336,625
Number of common stock shares sold			112,208
Value of common stock shares sold			100,000
Number of shares authorized to purchased each and any business.		100,000
Amount of shares authorized to purchased each and any business.		$ 500,000
Period of prior written notice	1 day
Percentage of trading volumes for next business days	20.00%
Description of VWAP Purchase Price	(i) the closing sale price of the shares on the purchase date, or (ii) ninety-five percent (95%) of the next business day's volume weighted average price (each such purchase, a "VWAP Purchase").
VWAP purchase price	$ 0.50

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Due To Officer (Detail Textuals 1) (USD $)			0 Months Ended
	Dec. 31, 2012	Jun. 30, 2012	May 08, 2012 Promissory Note C Mr. Ehrlich	Dec. 31, 2012 Promissory Note C Mr. Ehrlich	May 07, 2012 Promissory Note C Mr. Ehrlich
Debt Instrument [Line Items]
Number of shares converted			2,000,000
Bid Price of shares converted			$ 0.51		$ 0.46
Percentage of Bid Price			110.00%
Term of shares			10 years
Interest accrued				$ 357,665
Balance of demand note	$ 2,022,264	$ 2,022,264		$ 2,022,264

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Stock Options and Warrants - Stock option activity (Details) (Stock Options)	6 Months Ended
	Dec. 31, 2012	Dec. 31, 2011
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected dividend yield	0.00%	0.00%
Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected term (in years)	10 years	10 years
Expected stock price volatility	137.33%	148.15%
Risk-free interest rate	1.75%	3.00%
Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected term (in years)	5 years	3 years
Expected stock price volatility	134.22%	143.45%
Risk-free interest rate	1.53%	1.98%

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Organization And Nature Of Business

6 Months Ended

Dec. 31, 2012

Organization and Nature Of Business [Abstract]

Organization And Nature Of Business

1.          Organization And Nature Of Business

Cellceutix Corporation, formerly known as EconoShare, Inc., (the “Company” or the “Registrant”) was incorporated on August 1, 2005 in the State of Nevada and was organized for the purpose of developing a B2B (Business to Business) website for an Asset Sharing market place and transaction system.

On December 6, 2007, the Company acquired Cellceutix Pharma, Inc., a privately owned Delaware corporation pursuant to an Agreement and Plan of Share Exchange (the “Exchange”).  Cellceutix Pharma, Inc. was incorporated under the laws of the State of Delaware on June 20, 2007.  Its assets consisted of rights assigned to it for six early stage pharmaceutical compounds by three different scientists.

Pursuant to the terms of the Exchange, the Company acquired Cellceutix Pharma, Inc. in exchange for an aggregate of 82,000,000 newly issued shares of the Company’s common stock, par value $0.0001 per share (the “Common Stock”).  As a result of the Exchange, Cellceutix Pharma, Inc. became a wholly-owned subsidiary of the Company.  The Company’s shares were issued to the Cellceutix Pharma, Inc. shareholders on a pro rata basis, on the basis of 82 shares of Common Stock for each share of Cellceutix Pharma, Inc. common stock held by such Cellceutix Pharma, Inc. shareholder at the time of the Exchange.  This resulted in the former holders of Cellceutix Pharma, Inc. Common Stock, upon Exchange, owning approximately 89% of the outstanding shares of the Company’s Common Stock. Accordingly, the Exchange represented a change in control.  For financial accounting purposes, the acquisition was a reverse acquisition of the Company by Cellceutix Pharma, Inc., under the purchase method of accounting, and was treated as a recapitalization with Cellceutix Pharma, Inc. as the legal acquirer. Upon consummation of the Exchange, the Company adopted the business plan of Cellceutix Pharma, Inc. . We are an early stage developmental biopharmaceutical company.  The Company has no customers, products or revenues to date, and may never achieve revenues or profitable operations. 

On January 14, 2008, a majority of the shareholders of the Company approved an amendment to the Registrant’s articles of incorporation to change the name of the Registrant to Cellceutix Corporation.  Upon the filing of a Definitive Information Statement and effectiveness of the name change on February 1, 2008, the Company applied to the National Association of Security Dealers (NASD) to change its stock symbol on the Over the Counter Bulletin Board which resulted in the Company’s stock symbol being changed to CTIX. 

On December 29, 2010 shareholders adopted and approved the 2010 Equity Incentive Plan and authorized an amendment to the Company’s Articles of Incorporation to authorize Class B common stock convertible into Class A common stock on a 1:1 basis, however the Class B Common Stock shall entitle ten votes for each share of Class B Common Stock. All shares issued as of balance sheet dates are Class A common stock.

On June 21, 2012, the U.S. Food and Drug Administration ("FDA") approved the Investigational New Drug (IND) application for Kevetrin™, Cellceutix's novel anti-cancer compound. The Phase 1 trials are being conducted at Harvard Cancer Center's Dana-Farber Cancer Institute and partner Beth Israel Deaconess Medical Center.  The clinical trial will test Kevetrin against a variety of different solid tumor cancer types in patients with advanced-stage cancers. Primary endpoints for the study will be safety, tolerable dosing levels and establishing the dose for a future Phase II clinical trial. The trial is registered on www.clinical trials.gov. "http://clinicaltrials.gov/ct2/show/NCT01664000?term=Kevetrin&rank=1">http://clinicaltrials.gov/ct2/show/NCT01664000?term=Kevetrin&rank=1

In March 2012, we entered into an agreement with Beth Israel Deaconess Medical Center (BIDMC), a teaching hospital of Harvard Medical School, on an innovative research project with Kevetrin. The Medical Center wishes to exploit the nuclear and/or mitochondrial pro-apoptotic function of p53 in melanoma and renal cell carcinoma, two types of cancer that are particularly resistant to therapy. BIDMC hopes to improve therapy for melanoma and renal cell carcinoma, cancers that are particularly resistant to therapy. 

BIDMC initiated combination studies with multikinase inhibitors which activate pro-apoptotic activity by translocation of p53 in mitochondria thereby inducing apoptosis. Apoptosis is enhanced by MDM2 inhibitors by stabilizing p53. As presented at the American Association for Cancer Research (AACR) meeting in April, Kevetrin phosphorylates MDM2 which activates and stabilizes p53 by monoubiquitination inducing apoptosis. Prior data from the BIDMC laboratory showed that agents of this class can augment the pro-apoptotic and antitumor effects of MDM2 antagonists and is expected to have a synergistic effect with Kevetrin. BIDMC will test the effects of Kevetrin alone and in combination with FDA-approved VEGFR antagonists in the renal cell carcinoma and melanoma studies. In vitro study endpoints include apoptosis by measuring caspase activation and PARP cleavage. In vivo endpoints include efficacy in a xenograft model, tumor vascularity, p53 levels, p21 expression and apoptosis. This study will provide vital insight to exploit the nuclear and/or mitochondrial pro-apoptotic function by Kevetrin in combination with other multikinase inhibitors in treatment of these difficult to treat malignancies. At this time the study is in progress. Results of these preclinical tests provided to date to the Company are encouraging and BIDMC and Cellceutix wish to move the study further. Cellceutix has provided the requested information from BIDMC that will be used to investigate a Specialized Programs of Research Excellence (SPORE) grant for a phase 2 clinical study of renal cancer.

In January 2013 the Company announced that the University of Bologna in Italy (the “University”) and The Italian Cooperative Study Group on Chronic Myeloid Leukemia (ICSG on CML) and Acute Leukemia (GIMEMA Group) plan on testing Kevetrin against Acute Myelogenous Leukemia (AML). The Company has been advised that the study, a phase 1b trial, will be titled “A Multi-Center, Open-Label, Phase 1B Study of Escalating Doses of Kevetrin (Thioureidobutyronitrile) Administered Intravenously, with Cytarabine Adminstered A) Subcutaneously, or B) Intravenously, in Patients with Acute Myelogenous Leukemia (AML).” The study is scheduled to begin in the first half of 2013.  The University will source the funding for this trial.

The Company also announced it is presently in discussions with other institutions for collaborations in conducting clinical trials with Kevetrin on multiple cancers. 

In June 2012, Cellceutix participated in a pre IND meeting with the U.S. Food and Drug Administration ("FDA") pertaining to Prurisol™, a drug for treating psoriasis. The Company had requested the meeting for guidance on its initiatives to seek a section 505(b)(2) designation for Prurisol™, which would allow the Company to forgo early-stage trials and advance Prurisol™ into latter-stage clinical trials.  Cellceutix was advised by the FDA that a 505(b)(2) application would be an acceptable approach for Prurisol. In September 2012, Cellceutix selected Dr. Reddy's Laboratories as its vendor to manufacture and formulate Prurisol for planned clinical trials. The Company plans to sponsor a Phase II/III Proof of Concept trial in Europe that is planned to begin late first quarter/early second quarter 2013.  This will be a relatively short trial with only 30 days of treatment and 30 days of follow-up to evaluate the efficacy and safety of Prurisol. The manufacturer, Dr. Reddy’s Laboratories Ltd., has advised the Company that the manufacturing of Prurisol is planned to begin in February 2013.

At this time the Company is focusing its research and development efforts exclusively on Kevetrin and Prurisol.

On September 13, 2012, the company filed a Certificate of Correction with the State of Nevada to correct the par value of the preferred shares from the amended articles of incorporation filed June 24, 2011 from $.0001 per share to $.001 per share. 

On December 6, 2012 , the Company entered into a Class A Common Stock Purchase Agreement with Aspire Capital Fund, LLC, which provides that upon meeting the terms of the agreement, Aspire Capital is committed to purchase up to an aggregate of $10,000,000 million of the Company’s shares of Class A Common Stock over the approximately 36-month term of the Purchase Agreement.  (SEE NOTE 9)

On  December 25, 2012 the United States Patent and Trademark Office (USPTO) awarded the Company U.S. Patent No. 8,338,454 B2, titled "Nitrile Derivatives and their Pharmaceutical Use and Compositions."  The patent covers pharmaceutical compositions comprising Kevetrin™, and related compounds and compositions.

The Company’s Common Stock is quoted on the Over the Counter Bulletin Board (OTCBB), symbol “CTIX”.

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Stock Options and Warrants - Options outstanding and exercisable (Details 1) (Stock Options, USD $)	1 Months Ended	6 Months Ended
	Apr. 30, 2009	Dec. 31, 2012
Stock Options
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward]
Number of options, Outstanding		41,277,500
Number of options, Granted	10,000	90,000
Number of options, Exercised		(2,250,000)
Number of options, Forfeited/expired
Number of options, Outstanding		39,117,500
Number of options, Exercisable		39,052,500
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Roll Forward]
Weighted average exercise price, Outstanding		$ 0.14
Weighted average exercise price, Granted		$ 0.85
Weighted average exercise price, Exercised		$ 0.12
Weighted average exercise price, Forfeited/expired
Weighted average exercise price, Outstanding		$ 0.14
Weighted average exercise price, Exercisable		$ 0.14
Share-Based Compensation Arrangement By Share-Based Payment Award, Options, Outstanding, Weighted Average Remaining Contractual Term [Roll Forward]
Weighted average remaining contractual life (Years), Outstanding		8 years 5 months 16 days
Weighted average remaining contractual life (Years), Granted		8 years 1 month 2 days
Weighted average remaining contractual life (Years), Outstanding		7 years 11 months 19 days
Weighted average remaining contractual life (Years), Exercisable		7 years 11 months 12 days
Aggregate intrinsic value, Outstanding		$ 21,186,225
Aggregate intrinsic value, Outstanding		66,131,775
Aggregate intrinsic value, Exercisable		$ 66,070,958

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Equity Transactions (Detail Textuals) (USD $)												0 Months Ended	1 Months Ended			0 Months Ended	1 Months Ended											1 Months Ended
	Dec. 31, 2012	Jun. 30, 2012	Sep. 30, 2012 Warrants	Sep. 24, 2012 Warrants	Sep. 19, 2012 Warrants	Aug. 23, 2012 Warrants	Aug. 01, 2012 Warrants	Jun. 25, 2012 Warrants	Dec. 31, 2011 Warrants	Nov. 30, 2011 Warrants	Oct. 31, 2011 Warrants	Jul. 03, 2012 Series A convertible preferred stock	Sep. 19, 2012 Series A convertible preferred stock	Sep. 20, 2012 Series A convertible preferred stock	Aug. 23, 2012 Series A convertible preferred stock	May 08, 2012 Series A convertible preferred stock	Aug. 31, 2012 Series A convertible preferred stock	Jul. 30, 2012 Series A convertible preferred stock	Aug. 01, 2012 Series A convertible preferred stock	Dec. 31, 2012 Series A convertible preferred stock	Sep. 13, 2012 Series A convertible preferred stock	Aug. 14, 2012 Series A convertible preferred stock	Jul. 25, 2012 Series A convertible preferred stock	Jun. 30, 2012 Series A convertible preferred stock	Jun. 24, 2011 Series A convertible preferred stock	Sep. 19, 2012 Class A common stock	Jun. 25, 2012 Class A common stock	Sep. 24, 2012 Preferred Shares	Jun. 25, 2012 Preferred Shares	Aug. 31, 2012 Preferred Shares	May 07, 2012 Preferred Shares
Class of Stock [Line Items]
Series A Convertible Preferred shares issued- value																$ 1,000,000
Value of preferred shares purchased												$ 75,000	$ 75,000	$ 75,000	$ 75,000	$ 75,000	$ 75,000	$ 75,000	$ 75,000									$ 75,000	$ 100,000
Shares issued (in shares)												7,500	7,500	7,500	7,500		7,500	7,500	7,500									7,500	10,000
Installment funding term																30 days
Percentage of total volume traded																25.00%
Number of trading days																22 days
Maximum percentage of closing bid price on the date													85.00%		85.00%	85.00%			85.00%									85.00%	85.00%
Lowest bid price percentage prior to conversion																85.00%
Lowest bid price number of days prior to conversion																15 days
Percentage common stock beneficially owning of total common stock outstanding																9.99%
Expiry period of warrants													5 years		5 years	5 years			5 years									5 years	5 years
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001											$ 0.527						$ 0.49	$ 0.001	$ 0.001			$ 0.001	$ 0.0001			$ 0.527	$ 0.39
Preferred stock conversion price													$ 0.527											$ 0.485				$ 0.527
Converted common stock price per share (in dollars per share)																	$ 0.62					$ 0.571	$ 0.59							$ 0.62	$ 0.46
Common stock purchase				142,315	142,315	154,639	153,061	255,754	2,500,000	2,500,000	2,500,000
Common stock share purchase warrants (in dollars per share)			1.00	0.527	0.527	0.485	0.49	0.39																		0.527	0.39

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Balance Sheets (USD $)	Dec. 31, 2012	Jun. 30, 2012
Current assets:
Cash	$ 222,862	$ 27,703
Prepaid expenses	12,204	325
Total current assets	235,066	28,028
Deferred offering costs	297,001
Intangibles, net	2,847
Total assets	534,914	28,028
Current liabilities:
Accounts payable (including related party payables of $1,695,683 and $1,695,820, respectively)	1,988,003	1,966,026
Accrued expenses (including related party accruals of $412,565 and $316,130, respectively)	412,568	330,880
Accrued salaries and payroll taxes	3,204,023	2,789,571
Note payable to officer	2,022,264	2,022,264
Accrued settlement costs, current	288,270	270,055
Total current liabilities	7,915,128	7,378,796
Long Term Liabilities
Accrued settlement costs, net of current	275,229	275,229
Total liabilities	8,190,357	7,654,025
Common stock:
Additional paid in capital	10,628,983	9,229,157
Deficit accumulated during development stage	(17,766,537)	(16,336,918)
Treasury stock 2,762,084 shares at cost as of December 31, 2012 and June 30, 2012 respectively	(527,733)	(527,733)
Total stockholders' deficit	(7,655,443)	(7,625,997)
Total Liabilities and Stockholders' Deficit	534,914	28,028
Series A convertible preferred stock
Stockholders' Deficit
Preferred stock; $.001 par value; 9,500,000 shares authorized Series A convertible preferred stock; $.001 par value; 500,000 shares designated, 0 and 0 shares issued and outstanding as of December 31, 2012 and June 30, 2012, respectively
Class A common stock
Common stock:
Common Stock, Value	9,839	9,497
Class B common stock
Common stock:
Common Stock, Value

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Statement of Changes in Stockholders' Deficit (Unaudited) (Parentheticals) (USD $)	12 Months Ended												6 Months Ended	12 Months Ended		6 Months Ended	12 Months Ended	6 Months Ended	12 Months Ended	6 Months Ended
	Jun. 30, 2012 January	Jun. 30, 2011 February	Jun. 30, 2010 February	Jun. 30, 2012 March	Jun. 30, 2011 March	Jun. 30, 2012 April	Jun. 30, 2008 April	Jun. 30, 2012 May	Jun. 30, 2011 May	Jun. 30, 2012 June	Jun. 30, 2010 June	Jun. 30, 2009 June	Dec. 31, 2012 July	Jun. 30, 2011 July	Jun. 30, 2010 July	Dec. 31, 2012 August	Jun. 30, 2012 August	Dec. 31, 2012 October	Jun. 30, 2012 November	Dec. 31, 2012 December
Shares issued, price per share for services (in dollars per share)	$ 0.45	$ 0.20	$ 0.30		$ 0.32	$ 0.46	$ 1.05	$ 0.49	$ 0.81	$ 0.62	$ 0.45	$ 0.38	$ 0.59	$ 0.55	$ 0.43	$ 0.60	$ 0.38	$ 0.87	$ 0.41
Shares issued, price per share for services (in dollars per share) (two)								$ 0.53				$ 0.38
Share issued, price per share charitable contributions (in dollars per share)				$ 0.52
Shares issued, price per share for commitment fee (in dollars per share)																				$ 0.89
Shares issued, price per share at net offering cost (in dollars per share)																				$ 0.89

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Stock Options and Warrants (Detail Textuals 2) (2010 Equity Incentive Plan)	6 Months Ended
	Dec. 31, 2012
2010 Equity Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock shares reserved for future issuance	45,000,000
Term of incentive stock option granted	10 years
Percentage of combined voting power	10.00%

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Going Concern (Detail Textuals) (USD $)	3 Months Ended		6 Months Ended		66 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2012
Agreement [Line Items]
Net loss attributable to common stockholders	$ (748,820)	$ (2,060,405)	$ (1,429,614)	$ (3,021,858)	$ (17,757,453)
Working capital deficit	(7,680,062)		(7,680,062)		(7,680,062)
Financing Agreement | Aspire Capital Fund LLC
Agreement [Line Items]
Working capital fund obtained from financing agreement	$ 10,000,000		$ 10,000,000		$ 10,000,000

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Stock Options and Warrants (Detail Textuals 3) (Stock Options, USD $)	3 Months Ended		6 Months Ended		66 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2012
Stock Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total share-based compensation expense	$ 137,818	$ 616,674	$ 214,165	$ 1,246,444	$ 6,903,282
Unamortized compensation cost expected to be recognized	$ 57,898		$ 57,898		$ 57,898

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Commitments and Contingencies (Detail Textuals) (USD $)	12 Months Ended			0 Months Ended			6 Months Ended
	Jun. 30, 2011	Dec. 31, 2012	Jun. 30, 2012	Feb. 04, 2012 Mr. Evans	Feb. 14, 2011 Mr. Evans	Feb. 14, 2011 Settlement Agreement Mr. Evans	Dec. 31, 2012 Settlement Agreement Mr. Evans
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Repurchase of stock, shares						4,602,312
Duration of shares repurchase						3 years
Repurchase of stock, value						$ 1,000,000
Payment on signing of agreement				300,000	100,000
Cancellation of treasury stock (in shares)				1,380,000	460,229
Remaining shares of common stock held in escrow		2,762,084	2,762,084
Related payroll taxes as a capital contribution	932,966						932,966
Settlement liability		563,499
Accrued current liability		$ 288,270	$ 270,055

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Statements of Cash Flows (Unaudited) (USD $)	6 Months Ended		66 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2012
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$ (1,217,812)	$ (3,021,858)	$ (17,479,965)
Adjustments to reconcile net loss to net cash used in operating activities:
Common stock and stock options issued as payment for services compensation, services rendered, and charitable contributions	214,165	1,269,630	6,903,283
Cancellation of stock issued for services			(28,750)
Amortization of accrued settlement costs	18,215	34,173	104,111
Gain (loss) on financial instruments		909,892	439,892
Changes in operating assets and liabilities:
Other receivables		204,144
Prepaid expenses	(11,879)	(1,010)	(3,719)
Amortization of intangibles	501		501
Accounts payable	21,977	(101,665)	1,988,052
Accrued expenses	81,688	116,313	629,979
Accrued officers' salaries and payroll taxes	414,452	366,340	4,136,988
Net cash used in operating activities	(478,693)	(224,041)	(3,309,628)
CASH FLOWS FROM INVESTING ACTIVITIES:
Intangibles	(3,348)		(3,348)
Net cash used in investing activities	(3,348)		(3,348)
CASH FLOWS FROM FINANCING ACTIVITIES:
Capital contribution from stockholder			50
Sale of common stock			100
Sale of common stock, net of offering costs	97,000		97,000
Deferred offering costs	3,000		3,000
Sale of preferred stock	300,000		400,000
Payment of settlement liabilities			(400,000)
Loan from officer		20,000	1,925,587
Proceeds from convertible debentures			(167,099)
Redemption of convertible debentures			400,000
Proceeds from subscription		1,000,000	1,000,000
Exercise of stock options	277,200		277,200
Net cash provided by financing activities	677,200	1,020,000	3,535,838
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS	195,159	795,959	222,862
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD	27,703	68,661
CASH AND CASH EQUIVALENTS, END OF PERIOD	222,862	864,620	222,862
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash paid for interest	25,909		40,735
SUPPLEMENTAL DISCLOSURE OF NON-CASH FLOW FINANCING ACTIVITIES
Common stock issued for acquisition			9,079
Forgiveness of debt			50
Reclassification of accrued interest to note payable and convertible debentures			197,964
Cancellation of common stock for services			(138,750)
Settlement of accrued payroll and payroll taxes			932,966
Cancellation of common stock as a result of settlement			859,388
Debt converted to common stock		353,635	353,635
Cancellation of treasury stock			(231,655)
Reclassification of warrants to equity			857,500
feature on preferred stock	53,032		70,678
Deemed dividend - warrants	158,770		206,810
Conversion of preferred stock into common stock	$ (30)		$ (46)

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Balance Sheets (Parentheticals) (USD $)	Dec. 31, 2012	Jun. 30, 2012	Dec. 31, 2012 Series A convertible preferred stock	Jun. 30, 2012 Series A convertible preferred stock	Dec. 31, 2012 Class A common stock	Jun. 30, 2012 Class A common stock	Dec. 31, 2012 Class B common stock Vote	Jun. 30, 2012 Class B common stock Vote
Accounts payable, related party payables (in dollars)	$ 1,695,683	$ 1,695,820
Accrued expenses, related party interest and rent accruals (in dollars)	$ 412,565	$ 316,130
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001	$ 0.001	$ 0.001
Preferred stock, shares authorized (in shares)	9,500,000	9,500,000	500,000	500,000
Preferred stock, shares issued (in shares)			0	0
Preferred stock, shares outstanding (in shares)			0	0
Number of votes entitled in class of stock (in votes)							10	10
Common stock, par value (in dollars per share)					$ 0.0001	$ 0.0001	$ 0.0001	$ 0.0001
Common stock, shares authorized (in shares)					300,000,000	300,000,000	100,000,000	100,000,000
Common stock, shares issued (in shares)					98,385,068	94,968,905	0	0
Common stock, shares outstanding (in shares)					95,622,984	92,206,821	0	0
Treasury stock, shares (in shares)	2,762,084	2,762,084

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Commitments and Contingencies (Tables)

6 Months Ended

Dec. 31, 2012

Commitments and Contingencies Disclosure [Abstract]

Schedule of accrued officers' salaries and payroll taxes

	December 31, 2012		June 30, 2012
Krishna Menon	$	1,635,000	$	1,442,500
Leo Ehrlich	$	1,397,500	$	1,205,000
Accrued Payroll Taxes	$	171,523	$	142,071
	$	3,204,023	$	2,789,571

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Document and Entity Information	6 Months Ended
	Dec. 31, 2012	Feb. 11, 2013
Document and Entity Information [Abstract]
Entity Registrant Name	Cellceutix CORP
Entity Central Index Key	0001355250
Trading Symbol	ctix
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Current Fiscal Year End Date	--06-30
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		95,622,984
Document Type	10-Q
Document Period End Date	Dec. 31, 2012
Amendment Flag	false
Document Fiscal Year Focus	2013
Document Fiscal Period Focus	Q2

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Stock Options and Warrants (Tables)

6 Months Ended

Dec. 31, 2012

Disclosure Of Compensation Related Costs, Share-Based Payments [Abstract]

Schedule of fair value of option estimated on the date of grant or grant modification using the Black Scholes model assumptions

	Six Months Ended December 31, 2012			Six Months Ended December 31, 2011
Expected term (in years)		5-10			3-10
Expected stock price volatility		134.22% - 137.33	%		143.45%-148.15	%
Risk-free interest rate		1.53% - 1.75	%		1.98%-3.00	%
Expected dividend yield		0	%		0	%

Schedule of stock option activity

	Number of Options		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Years)		Aggregate Intrinsic Value
Outstanding at June 30, 2012		41,277,500	$	0.14		8.46	$	21,186,225
Granted		90,000		0.85		8.09		---
Exercised		(2,250,000)		0.12		—		—
Forfeited/expired		—		—		—		—
Outstanding at December 31, 2012		39,117,500	$	0.14		7.97	$	66,131,775
Exercisable at December 31, 2012		39,052,500	$	0.14		7.95	$	66,070,958

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Statements of Operations (Unaudited) (USD $)	3 Months Ended		6 Months Ended		66 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2012
Income Statement [Abstract]
Revenues
Operating expenses:
Research and development, gross	281,516	106,964	466,469	209,866	5,563,481
Grants					(733,438)
Research and development, net of grants	281,516	106,964	466,469	209,866	4,830,043
General and administrative expenses	28,267	12,230	52,287	19,069	587,058
Officers' payroll and payroll tax expense	113,975	646,582	227,949	1,298,904	7,821,633
Professional fees	244,573	225,230	321,888	357,321	2,900,799
Patent expense	20,409	81,720	29,059	81,720	197,352
Total operating expenses	688,740	1,072,726	1,097,652	1,966,880	16,336,885
Loss from operations	(688,740)	(1,072,726)	(1,097,652)	(1,966,880)	(16,336,885)
Interest expense - net	(60,080)	(77,787)	(120,160)	(145,086)	(703,188)
Warrant expense		(909,892)		(909,892)	(439,892)
Total other expenses	(60,080)	(987,679)	(120,160)	(1,054,978)	(1,143,080)
Net loss before provision for income taxes	(748,820)	(2,060,405)	(1,217,812)	(3,021,858)	(17,479,965)
Provision for income taxes
Net loss	(748,820)	(2,060,405)	(1,217,812)	(3,021,858)	(17,479,965)
Deemed dividends			(211,802)		(277,488)
Net loss attributable to common stockholders	$ (748,820)	$ (2,060,405)	$ (1,429,614)	$ (3,021,858)	$ (17,757,453)
Basic and diluted loss per share attributable to common stockholders (in dollars per share)	$ (0.01)	$ (0.01)	$ (0.02)	$ (0.03)
Weighted average number of common shares used in basic and fully diluted per share calculations (in shares)	93,507,421	94,076,076	93,001,981	92,996,474

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Commitments and Contingencies

6 Months Ended

Dec. 31, 2012

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

5.           Commitments and Contingencies

Settlement Agreement

On February 14, 2011, the Company announced it reached a settlement agreement on all outstanding claims and issues between the Company and our former CEO, Mr. Evans. Each party dropped their respective claims and as a result all of Mr. Evans accrued salaries and options were cancelled.  The terms of the agreement provide that the Company purchase 4,602,312 common shares held by Mr. Evans and/or Mr. Evans’ sons over a period of three years for a total sum of one million dollars.   Payment by the Company in the amount of $100,000 was made upon signing of the agreement, which resulted in reducing the liability owed to Mr. Evans; cancelling 460,229 shares of common stock.  On February 4, 2012, the Company made the second payment of $300,000 to Mr. Evans and cancelled 1,380,000 shares of its common stock.  The remaining 2,762,084 shares of common stock held in escrow until additional payments are made under the agreement are shown as Treasury Stock on the Company’s Balance Sheet. 

The Company had initially recorded this settlement at December 31, 2010 as a liability of the present value of the future payments and treasury stock. The Company had also recorded the forgiveness of Mr. Evans’ accrued payroll and related payroll taxes as a capital contribution of $932,966.  As of December 31, 2012, the settlement liability is $563,499 of which $288,270 is due in February 2013 and recorded as current liability. 

Legal

Cellceutix Corporation has entered into a settlement agreement with a former vendor Toxikon Corporation, settling all claims asserted by Toxikon in a civil action filed by Toxikon Corporation in the Commonwealth of Massachusetts.  Cellceutix Corporation has agreed to pay Toxikon Corporation ninety-thousand ($90,000.00) dollars prior to March 1, 2013 in full settlement of the claims asserted and the amount has been recorded on the balance sheet as of December 31, 2012..

Formatech is a former vendor of the Company which had received Cellceutix common stock and had also gone bankrupt. In July 2012, Cellceutix was advised that a US Bankruptcy Court judge has allowed Formatech’s bankruptcy trustee to sell 184,375 restricted shares of Cellceutix Class A Common Stock. The proceeds of any sales of these shares will be held in escrow pending the outcome of Cellceutix’s claims against Formatech. Cellceutix has engaged an attorney with the aim of recovering these funds.

Pharmaceutical Compounds

On August 2, 2007, the Company was assigned all right, title, and interest to three pharmaceutical compounds; Kevetrin, KM 277 and KM 278, by their inventors. The Company was assigned all right, title, and interest to an additional three pharmaceutical compounds on October 17, 2007, KM 133 KM 362 and KM 3174. In July 2009, the Company was assigned all right, title, and interest to KM 732.  In exchange for these compounds, the Company agreed to pay the inventors 5% of net sales of the compounds in countries where composition of matter patents have been issued and 3% of net sales in other countries. Kevetrin, KM 277, KM 278 and KM 362 were acquired from our President and director, Dr. Krishna Menon.  In December 2012, the Company was issued a US patent  for Kevetrin.  The Company intends to file patent applications for each of the other six compounds as studies advance and funds become available.    

 In December 2009, the Company was assigned all right, title and interest to a new compound, KM-391, which it intends to develop for the treatment of autism.  In exchange for this compound, the Company agreed to pay the inventors $10,000 plus 4.5% of net sales of the compound in countries where a composition of matter patent has been issued and 3% of net sales in other countries.

Employment Agreements

On December 29, 2010, the Company entered into employment agreements with its two executive officers, Leo Ehrlich, the Company’s Chief Executive Officer, and Krishna Menon, Chief Scientific Officer. Both agreements provide for a three year term with each executive receiving an annual base salary for $350,000 per year commencing January 1, 2011, with an annual increase of 10% for each year commencing January 2012. In addition, the Company’s Board awarded stock options exercisable at $0.11 per share pursuant to the Company’s 2010 Equity Incentive Plan to each executive officer as follows:  a total of 18 million options with 6 million options vesting on December 29, 2010, 6 million options vesting on June 30, 2011 and 6 million options vesting on January 3, 2012.    The Board, at its discretion, may increase the base salary based upon relevant circumstances.

The Company has recorded accrued officers’ salaries and payroll taxes are as follows:

	December 31, 2012		June 30, 2012
Krishna Menon	$	1,635,000	$	1,442,500
Leo Ehrlich	$	1,397,500	$	1,205,000
Accrued Payroll Taxes	$	171,523	$	142,071
	$	3,204,023	$	2,789,571

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Recent accounting pronouncements

6 Months Ended

Dec. 31, 2012

Recent Accounting Pronouncements [Abstract]

Recent accounting pronouncements

4.          Recent accounting pronouncements

The Company has reviewed all recent accounting pronouncements issued by FASB (including EITF), the AICPA and the SEC and did not or are not believed by management to have a material impact on the Company’s present or future financial statements.

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Commitments and Contingencies (Details) (USD $)	Dec. 31, 2012	Jun. 30, 2012
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items]
Accrued Payroll Taxes	$ 171,523	$ 142,071
Accrued salaries and payroll taxes	3,204,023	2,789,571
Krishna Menon
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items]
Accrued officers' salaries	1,635,000	1,442,500
Leo Ehrlich
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items]
Accrued officers' salaries	$ 1,397,500	$ 1,205,000

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Organization And Nature Of Business (Detail Textuals) (Cellceutix Pharma, USD $)	0 Months Ended
	Dec. 06, 2007
Cellceutix Pharma
Business Acquisition [Line Items]
Common stock issued in reverse merger	82,000,000
Share issue on a pro rata basis	82
Par value of common stock issued in reverse merger (in dollars per share)	$ 0.0001
Holding percentage of shareholders after merger	89.00%

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Stock Options and Warrants

6 Months Ended

Dec. 31, 2012

Disclosure Of Compensation Related Costs, Share-Based Payments [Abstract]

Stock Options and Warrants

8.   Stock Options and Warrants:

On April 1, 2009, the Company entered into an agreement, subsequently amended, with a Consultant to assist the Company’s Chief Scientific Officer to organize, manage and display data from animal studies as well as information relating to Active Pharmaceutical Ingredients and formulations of the Company’s products through November 2010. The Consultant was compensated at the rate of $4,000 per month payable on the last day of each month. In addition, at the end of each month of services provided, the Consultant is granted options to purchase 10,000 shares of Company’s common stock.  Effective September 1, 2010, the Company has extended the current agreement and beginning in August 2010, the monthly fee was increased to $5,000.  The remainder of the agreement remains unchanged.  As of December 31, 2012, the Consultant has been awarded a total of 450,000 options to purchase common stock valued at $233,918 to be vested over one year from date of issuance.  For the three and six months ended December 31, 2012, the Company has expensed $91,564, and $109,324 to professional fees expense, related to these options and remeasurement at December 31, 2012.

The fair value of each option for the six months ended December 31, 2012 and 2011 was estimated on the date of grant or grant modification using the Black Scholes model that uses assumptions noted in the following table.

	Six Months Ended December 31, 2012			Six Months Ended December 31, 2011
Expected term (in years)		5-10			3-10
Expected stock price volatility		134.22% - 137.33	%		143.45%-148.15	%
Risk-free interest rate		1.53% - 1.75	%		1.98%-3.00	%
Expected dividend yield		0	%		0	%

On April 5, 2009 the Board of Directors of the Registrant adopted the 2009 Stock Option Plan (“the Plan”). The Plan permits the grant of 2,000,000 shares of both Incentive Stock Options (“ISOs”), intended to qualify under section 422 of the Code, and Non-Qualified Stock Options.

Under the 2010 Equity Incentive Plan the  total number of shares of Common Stock reserved and available for issuance under the Plan shall be 45,000,000 shares. Shares of Common Stock under the Plan (“Shares”) may consist, in whole or in part, of authorized and unissued shares or treasury shares. The term of each Stock Option shall be fixed by the Committee; provided, however, that an Incentive Stock Option may be granted only within the ten-year period commencing from the Effective Date and may only be exercised within ten years of the date of grant (or five years in the case of an Incentive Stock Option granted to an optionee who, at the time of grant, owns Common Stock possessing more than 10% of the total combined voting power of all classes of voting stock of the Company (“10%Shareholder”).

Stock Options

The following table summarizes all stock option activity:

	Number of Options		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Years)		Aggregate Intrinsic Value
Outstanding at June 30, 2012		41,277,500	$	0.14		8.46	$	21,186,225
Granted		90,000		0.85		8.09		---
Exercised		(2,250,000)		0.12		—		—
Forfeited/expired		—		—		—		—
Outstanding at December 31, 2012		39,117,500	$	0.14		7.97	$	66,131,775
Exercisable at December 31, 2012		39,052,500	$	0.14		7.95	$	66,070,958

The Company recognized $137,818, $214,165, $616,674, 1,246,444, and $6,903,282 of stock based compensation costs related to stock and stock option awards for the three and six months ended December 31, 2012 and 2011 and the period from inception to December 31, 2012, respectively, and there is $57,898 of unamortized compensation cost expected to be recognized through December 31, 2013.  

As of December 31, 2012, there were 6,312,084 warrants issued and outstanding with a weighted average exercise price of $0.84.  Of these warrants, 2,964,000 warrants were to expire in September 2010, however in September 2010; the Company approved the extension of these warrants to December 31, 2013. 

During the months of October, November and December 2011, warrants to purchase 2,500,000 shares of the Company’s Class A common stock were issued to an investor pursuant to his purchase of 2,500,000 shares of the Company’s Class A common stock at $0.40 per share. Under ASC 815-40-25, the fair value of these warrants should be reported as a liability, Pursuant to the Warrant Agreement, because there is currently no effective registration statement covering the shares of common stock underlying these warrants, these warrants are currently subject to a cashless exercise whereby the warrant holders may surrender their warrants to the company in exchange for shares of common stock. The number of shares of common stock into which a warrant would be exchangeable in such a cashless exercise depends on both the exercise price of the warrants and the market price of the common stock, each at or near the time of exercise. Because both of these factors are variable, it is possible that the company could have insufficient authorized shares to satisfy a cashless exercise. In this scenario, if the company were unable to obtain shareholder approval to increase the number of authorized shares, the company could be obligated to settle such a cashless exercise with cash rather than by issuing shares of common stock. Further, ASC 815-40-25 requires that we record the potential settlement obligation at each reporting date using the current estimated fair value of the warrants, with any changes being recorded through our statement of operations. The warrants were valued at $417,608 at the time of issuance and recorded as a liability. At December 31, 2011, the warrants were valued at $1,327,500 and the warrant liability was increased by $909,892. On January 12, 2012, the subscription agreement was modified to remove the cashless exercise provision, and provide for “piggy-back” registration rights. The warrants were valued as of January 12, 2012 and the value reduced by $470,000.  The remaining $857,000 of warrant value was reclassified from a liability to equity.  As of September 30, 2012, these 2,500,000 warrants are outstanding with an exercise price of $1.00 and expire in October, November and December 2014.

On August 1, 2012, warrants to purchase 153,061 shares of the Company’s Class A common stock were issued to an investor pursuant to the conversion of 7,500 shares of Series A Convertible Preferred Stock into 153,061 shares of the Company’s Class A common stock at $0.49 per share of common stock.  The exercise price of the warrants is $0.49 per share.

On August 23, 2012, warrants to purchase 154,639 shares of the Company’s Class A common stock were issued to an investor pursuant to the conversion of 7,500 shares of Series A Convertible Preferred Stock into 154,639 shares of the Company’s Class A common stock at $0.485 per share of common stock.  The exercise price of the warrants is $0.485 per share.

On September 19, 2012, warrants to purchase 142,315 shares of the Company’s Class A common stock were issued to an investor pursuant to the conversion of 7,500 shares of Series A Convertible Preferred Stock into 142,315 shares of the Company’s Class A common stock at $0.527 per share of common stock.  The exercise price of the warrants is $0.527 per share.

On September 24, 2012, warrants to purchase 142,315 shares of the Company’s Class A common stock were issued to an investor pursuant to the conversion of 7,500 shares of Series A Convertible Preferred Stock into 142,315 shares of the Company’s Class A common stock at $0.527 per share of common stock.  The exercise price of the warrants is $0.527 per share.

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Related Party Transactions

6 Months Ended

Dec. 31, 2012

Related Party Transactions [Abstract]

Related Party Transactions

6.           Related Party Transactions

Office Lease

Dr. Menon, the Company’s principal shareholder, President, and Director, also serves as the Chief Operating Officer and Director of Kard Scientific (“KARD”). On December 7, 2007, the Company began renting office space from KARD, on a month to month basis for $900 per month.  At December 31, 2012 and June 30, 2012, payables of $54,900 and $49,500 to KARD were included in accrued expenses, respectively. For the three and six months ended December 31, 2012 and 2011  and the period June 20, 2007 (date of inception) through December 31, 2012, the Company has included $2,700, $5,400, $2,700, $5,400, and $54,900 in general and administrative expenses, respectively.

Clinical Studies

As of September 28, 2007 the Company engaged KARD to conduct specified pre-clinical studies necessary for the Company to prepare an IND submission to the FDA.  The Company does not have an exclusive arrangement with KARD.  All work performed by KARD must have prior approval by the executive officers of the Company, and the Company retains all intellectual property resulting from the services by KARD. For the three and six months ended December 31, 2012 and 2011 and the period June 20, 2007 (date of inception) through December 31, 2012, the Company incurred $0, $0, $0, $9,990, and $2,601,110 of research and development expenses conducted by KARD, respectively.  At December 31, 2012 and June 30, 2012 the Company has included a total of $1,685,515 and $1,685,515 in accounts payable to Kard respectively.

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Due To Officer

6 Months Ended

Dec. 31, 2012

Debt Disclosure [Abstract]

Due To Officer

7.           Due To Officer 

During the year ended June 30, 2010, Mr. Ehrlich, an officer of the Company, converted previous amounts provided in cash to the Company of $32,310 into a loan (the “Ehrlich Promissory Note A”).   The Ehrlich Promissory Note A was an unsecured, 6% per annum simple interest bearing, demand note.  During the same period, Mr. Ehrlich provided an additional $85,000 in cash in the form of a loan to the Company (the “Ehrlich Promissory Note B”).  The Ehrlich Promissory Note B was an unsecured, 6% per annum simple interest bearing, demand note.

During the year ended June 30, 2010, Mr. Ehrlich, loaned the Company a total of $972,907.  A condition for this loan was that the Ehrlich Promissory Note A and Ehrlich Promissory Note B be replaced with a new note, Ehrlich Promissory Note C.  The Ehrlich Promissory Note C is an unsecured demand note that bears 9% simple interest per annum and is convertible into the Company’s common stock at $0.50 per share.  The note requires that the interest rate on the amounts due on Ehrlich Promissory Notes A and B be changed retroactively, beginning October 1, 2009, to 9%.   During the year ended June 30, 2011, Mr. Ehrlich loaned the Company an additional $997,047 which brought the balance of the demand note to $2,002,264.  On April 1, 2011, the Company amended the Ehrlich Promissory Note C and agreed to retroactively convert accrued interest of $96,677 through December 31, 2010 into additional principal.

On May 8, 2012, in connection with the renegotiation of an outstanding loan to Mr. Ehrlich, the Company issued 2,000,000 Equity Incentive Options exercisable at $0.51 per share equal to 110% of the closing bid price of $0.46 per share on May 7, 2012. Options are valid for ten (10) years from the date of issuance.

 At December 31, 2012, $357,665 is accrued as interest expense on this note. As of December 31, 2012, the balance of the demand note is $2,022,264

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Equity Transactions

6 Months Ended

Dec. 31, 2012

Equity [Abstract]

Equity Transactions

9.           Equity Transactions

On May 8, 2012, the Company entered into a subscription agreement for Series A Convertible Preferred shares with an accredited investor for an aggregate of $1,000,000.  The subscription agreement provides for installment funding Amounts, at Cellceutix’s discretion, to take place every thirty days after initial closing date  for an amount of the lesser of  (i) $75,000 or  (ii) twenty five  (25%) per cent of the dollar value of the total volume traded during the preceding 22 trading days.   The Series A Preferred Shares are convertible into common stock at the lesser of 85% of the closing bid price on the date of prior to each closing, or 85% of the lowest bid price for the fifteen (15) days prior to conversion.  At no time may a holder of shares of Series A Preferred Stock convert shares of the Series A Preferred Stock if the number of shares of Common Stock to be issued pursuant to such conversion would exceed, when aggregated with all other shares of Common Stock owned by such holder at such time, the number of shares of Common Stock which would result in such holder beneficially owning more than 9.99% of all of the Common Stock outstanding.Additionally, for each common share issued upon conversion of Series A preferred share, a five year common stock purchase warrant is issued to the Subscriber.  The warrant is exercisable at the conversion price of the common shares issued.  The fair value of the common stock into which the Series A Preferred Stock is convertible will exceed the price at which the common stock will be issued on the date of issuance of the preferred stock.  The amount by which the fair value of the common stock exceeds the issue price of the common stock is a beneficial conversion feature.  The Company will recognize the beneficial conversion feature as a one-time, non-cash deemed dividend to the holders of the Series A Preferred Stock on the date of issuance, which is the date the preferred stock first became convertible.   The Series A Convertible Preferred shares do not pay dividends.   The Common shares underlying the Series A Preferred Shares and the common stock purchase warrants are subject to piggy back registration rights. The Agreement was mutually terminated between the parties on January 8, 2013.

On July 3, 2012 a tranche funding was made to purchase Series A Convertible Preferred shares in the amount of seventy five thousand dollars ($75,000) for the purchase 7,500 Series A Convertible Preferred Shares. 

On June 25, 2012 the subscriber converted 10,000 Preferred Shares equal to $100,000 face value at $0.39 per share based on 85% of the closing bid price on May 7, 2012 of $0.46.   The company issued to the subscriber 255,754 shares of Cellceutix common stock.  In connection thereto the Company issued 255,754 warrants to purchase common shares of Cellceutix Corporation at $0.39 per share valid for five years.

On July 30, 2012, a tranche funding was made to purchase Series A Convertible Preferred shares in the amount of seventy five thousand dollars ($75,000) for the purchase 7,500 Series A Convertible Preferred Shares.

On August 1, 2012 the Series A Convertible Preferred subscriber converted 7,500 Preferred Shares equal to $75,000 face value at $0.49 per share based on 85% of the closing bid price on July 25, 2012 of $0.59.   The company issued to the subscriber 153,061 shares of Cellceutix common stock.  In connection thereto the Company issued 153,061warrants to purchase common shares of Cellceutix Corporation at $0.49 valid for five years.   The shares and the warrants are subject to piggy back registration rights.

On August 23, 2012 the Series A Convertible Preferred subscriber converted 7,500 Preferred Shares equal to $75,000 face value at $0.485 per share based on 85% of the closing bid price on August 14, 2012 of $0.571.   The company issued to the subscriber 154,639 shares of Cellceutix common stock.  In connection thereto the Company issued 154,639 warrants to purchase common shares of Cellceutix Corporation at $0.485 valid for five years.

On August 31, 2012 a tranche funding was made to purchase Series A Convertible Preferred shares in the amount of $75,000 USD for the purchase of 7,500 Series A Convertible Preferred Shares.  

On September 19, 2012 the Series A Convertible Preferred subscriber converted 7,500 Preferred Shares equal to $75,000 face value at $0.527 per share based on 85% of the closing bid price on August 31, 2012 at $0.62.   The company issued to the subscriber 142,315 shares of Cellceutix common stock.  In connection thereto the Company issued 142,315 warrants to purchase common shares of Cellceutix Corporation at $0.527 valid for five years.   The shares and the warrants are subject to piggy back registration rights.

On September 20, 2012 a tranche funding was made to purchase Series A Convertible Preferred shares in the amount of $75,000 USD for the purchase of 7,500 Series A Convertible Preferred Shares.

On September 24, 2012 the subscriber converted 7,500 Preferred Shares equal to $75,000 face value at $0.527 per share based on 85% of the closing bid price on August 31, 2012 of $0.62.  The company issued to the subscriber 142,315 shares of Cellceutix common stock.  In connection thereto the Company issued 142,315 warrants to purchase common shares of Cellceutix Corporation at $0.527 valid for five years.   The shares and the warrants are subject to piggy back registration rights.

The shares and the warrants of the above fundings, and all subsequent fundings pursuant to Series A Convertible Preferred shares, are subject to piggy back registration rights.

On September 7, 2012 a consultant exercised their option to purchase 250,000 shares of Class A common shares at $0.20, resulting in a payment to the Company of $50,000 and the issuance of 250,000 shares of Class A common stock.

On October 24, 2012 the Company issued a total of 50,000 Class A common shares to consultants for services through December 31, 2012, valued at $43,500 based on the closing bid price as quoted on the OTC Bulletin Board on October 23, 2012 at $.87 per share. 

On December 19, 2012 the Company issued  320,000 Class A common shares par value $.0001 to a consultant upon exercise of stock options granted to him  pursuant to the Company’s 2009 and 2010 Equity Incentive Plans of which  80,000 were granted on March 2, 2009, exercisable at $0.14 per share; 200,000 were granted on February 8, 2011, exercisable at $0.20 per share; and 40,000 were granted on February 17, 2011 exercisable at $.20 per share.  The Company received $59,200.  

On December 21, 2012 the Company issued 1,680,000 Class A common shares to a consultant upon exercise of Stock Options granted on December 29, 2010 under the Company’s 2010 Equity Incentive Plan and exercisable  at $0.10 per share.    The Company received $168,000.  

On December 6, 2012 , the Company entered into a Class A Common Stock Purchase Agreement with Aspire Capital Fund, LLC, which provides that upon meeting the terms of the agreement, Aspire Capital is committed to purchase up to an aggregate of $10,000,000 million of our shares of Class A Common Stock over the approximately 36-month term of the Purchase Agreement.  In consideration for entering into the Purchase Agreement, the Company issued to Aspire Capital 336,625 shares of our Class A Common Stock as a commitment fee and sold to Aspire Capital 112,208 shares of Class A Common Stock for $100,000. The commitment fee will be amortized as the funding is received.  The unamortized portion is carried on the balance sheet as deferred offering costs.

Concurrently with entering into the Purchase Agreement, the Company agreed to file one or more registration statements as permissible and necessary under the Securities Act of 1933, as amended, or the Securities Act, for the sale of shares of our Class A Common Stock that have been and may be issued to Aspire Capital under the Purchase Agreement. On January 22, 2012, the Company filed a Form S-3 registration statement. The Company does not have the right to commence any sales of its shares to Aspire Capital until the SEC has declared the registration statement effective. Thereafter, on every and any business day selected by the Company, the Company shall have the right to direct Aspire Capital Fund to purchase (each such purchase, a “Regular Purchase”), up to 100,000 shares on each and any business day chosen by the Company; however, in any event, the amount of a Regular Purchase will not exceed $500,000 per business day. The purchase price for Regular Purchases (the “Regular Purchase Price”), shall be equal to the lesser of: (i) the lowest sale price of the shares on the purchase date, or (ii) the average of the three (3) lowest closing sale prices of the shares during the twelve (12) business days prior to the purchase date.  The Regular Purchase Price will be known at the time of notice and before any shares are sold to Aspire Capital Fund.

In addition to the Regular Purchases, with one day’s prior written notice, the Company shall also have the right to require the ACF Investor to purchase up to an additional 20% of the trading volume of the shares for the next business day at a purchase price (the “VWAP Purchase Price”), equal to the lesser of: (i) the closing sale price of the shares on the purchase date, or (ii) ninety-five percent (95%) of the next business day’s volume weighted average price (each such purchase, a “VWAP Purchase”).  The Company shall have the right, in its sole discretion, to determine a maximum number of shares and set a minimum market price threshold for each VWAP Purchase. The Company can only require a VWAP Purchase if (a) the closing sale price for the Company Class A common shares on the notice day for the VWAP Purchase is higher than $0.50, and (b) the Company has also submitted a Regular Purchase on the notice date for the VWAP Purchase.  There are no limits on the number of VWAP Purchases that the Company may require.

Aspire Capital Fund has no right to require any sales by the Company, but is obligated to make purchases from the Company as the Company directs it in accordance with the Purchase Agreement. The Company can also accelerate the amount of Class A Common Stock to be purchased under certain circumstances. There are no limitations on use of proceeds, financial or business covenants, restrictions on future funding, rights of first refusal, participation rights, penalties or liquidated damages in the Purchase Agreement.

The Company is never under any obligation to sell shares to Aspire Capital Fund.  Aspire Capital Fund has no rights to require the Company to sell shares.

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Stock Options and Warrants (Detail Textuals 1) (2009 Stock Option Plan)	Apr. 05, 2009
2009 Stock Option Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of stock options shares permits for grant	2,000,000

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Organization And Nature Of Business (Detail Textuals 2) (Common Stock Purchase Agreement, Class A common stock, Aspire Capital Fund LLC, USD $)	0 Months Ended
	Dec. 06, 2012
Common Stock Purchase Agreement | Class A common stock | Aspire Capital Fund LLC
Agreement [Line Items]
Common stock shares commited to purchase value	$ 10,000,000
Term of agreements	36 months

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Commitments and Contingencies (Detail Textuals 2) (Executive Officer, USD $) Share data in Millions, except Per Share data, unless otherwise specified	1 Months Ended
	Dec. 29, 2010	Dec. 31, 2012	Jan. 03, 2012	Jun. 30, 2011
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items]
Number of executive officers	2
2010 Equity Incentive Plan
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items]
Term of agreements	3 years
Annual base salary per year	$ 350,000
Percentage of annual increase in salary	10.00%
Exercisable price per share	$ 0.11
Number of shares vested	6	18	6	6

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Equity Transactions (Detail Textuals 1) (Stock Options, USD $)	6 Months Ended	0 Months Ended
	Dec. 31, 2012	Sep. 07, 2012 Class A common stock
Class of Stock [Line Items]
Number of options, Exercised	(2,250,000)	250,000
Weighted average exercise price, Exercised	$ 0.12	$ 0.20
Value of shares purchased		$ 50,000
Shares issued (in shares)		250,000

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Statement of Changes in Stockholders' Deficit (Unaudited) (USD $)	Common Stock	Preferred Stock	Additional Paid-In Capital	Deficit Accumulated During Development Stage	Treasury Stock	Total
Balance at Jun. 20, 2007	$ 100					$ 100
Balance (in shares) at Jun. 20, 2007	1,000,000
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss				(530)		(530)
Balance at Jun. 30, 2007	100			(530)		(430)
Balance (in shares) at Jun. 30, 2007	1,000,000
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Share exchange with CellceutixPharma, Inc. (December)	(100)			100
Share exchange with CellceutixPharma, Inc. (in shares) (December)	(1,000,000)
Share exchange in reverse merger with Cellceutix Pharma, Inc (December)	8,200			(8,200)
Share exchange in reverse merger with Cellceutix Pharma, Inc (in shares) (December)	82,000,000
Shares exchanged in a reverse acquisition of Cellceutix Pharma (December)	979			(979)
Shares exchanged in a reverse acquisition of Cellceutix Pharma (in shares) (December)	9,791,000
Forgiveness of debt from a stockholder			50			50
Capital contribution from a stockholder			50			50
Issuance of stock options			43,533			43,533
Shares issued for services (April)	10		104,990			105,000
Shares issued for services (in shares) (April)	100,000
Net loss				(510,193)		(510,193)
Balance at Jun. 30, 2008	9,189		148,623	(519,802)		(361,990)
Balance (in shares) at Jun. 30, 2008	91,891,000
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Cancellation of shares issued for services (December)	(10)		(104,990)			(105,000)
Cancellation of shares issued for services (in shares) (December)	(100,000)
Issuance of stock options			142,162			142,162
Shares issued for services (June)	2		7,598			7,600
Shares issued for services (in shares) (June)	20,000
Shares issued for services (two) (June)	3		9,497			9,500
Shares issued for services (two) (in shares) (June)	25,000
Net loss				(1,485,331)		(1,485,331)
Balance at Jun. 30, 2009	9,184		202,890	(2,005,133)		(1,793,059)
Balance (in shares) at Jun. 30, 2009	91,836,000
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of stock options			383,291			383,291
Shares issued for services (February)			1,050			1,050
Shares issued for services (June)	8		33,742			33,750
Shares issued for services (July)	2		10,748			10,750
Shares issued for services (in shares) (February)	3,500
Shares issued for services (in shares) (June)	75,000
Shares issued for services (in shares) (July)	25,000
Net loss				(3,433,400)		(3,433,400)
Balance at Jun. 30, 2010	9,194		631,721	(5,438,533)		(4,797,618)
Balance (in shares) at Jun. 30, 2010	91,939,500
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Cancellation of shares issued	(8)		(33,742)			(33,750)
Cancellation of shares issued (in shares)	(75,000)
Modification of stock options			237,098			237,098
Forgiveness of liability in connection with settlement with stockholder			932,966			932,966
Repurchase of common stock in connection with settlement					(859,388)	(859,388)
Repurchase of common stock in connection with settlement (in shares)					4,602,313
Issuance of stock options			3,060,691			3,060,691
Shares issued for services (February)	7		13,993			14,000
Shares issued for services (March)	18		58,982			59,000
Shares issued for services (May)	1		9,719			9,720
Shares issued for services (July)	5		27,495			27,500
Shares issued for services (in shares) (February)	70,000
Shares issued for services (in shares) (March)	184,375
Shares issued for services (in shares) (May)	12,000
Shares issued for services (in shares) (July)	50,000
Cancellation of treasury stock	(45)		(99,955)		100,000
Cancellation of treasury stock (in shares)	(460,229)				(460,229)
Net loss				(5,938,297)		(5,938,297)
Balance at Jun. 30, 2011	9,172		4,838,968	(11,376,830)	(759,388)	(7,288,078)
Balance (in shares) at Jun. 30, 2011	91,720,646				4,142,084
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Convertible Debentures converted to common stock	71		353,564			353,635
Convertible debentures converted to common stock (in shares)	707,277
Issuance of stock options			2,114,386			2,114,386
Shares issued for charitable contributions (March)	26		137,894			137,920
Shares issued for charitable contributions (in shares) (March)	265,228
Shares issued for services (January)	20		89,980			90,000
Shares issued for services (April)	30		137,970			138,000
Shares issued for services (May)	10		48,990			49,000
Shares issued for services (June)	5		31,145			31,150
Shares issued for services (August)	10		37,990			38,000
Shares issued for services (November)	13		51,236			51,249
Shares issued for services (in shares) (January)	200,000
Shares issued for services (in shares) (April)	300,000
Shares issued for services (in shares) (May)	100,000
Shares issued for services (in shares) (June)	50,000
Shares issued for services (in shares) (August)	100,000
Shares issued for services (in shares) (November)	125,000
Shares issued for services (two) (May)	2		13,248			13,250
Shares issued for services (two) (in shares) (May)	25,000
Issuance of capital stock	250		582,143			582,393
Issuance of capital stock (in shares)	2,500,000
Reclassification of warrants into equity			857,500			857,500
Cancellation of treasury stock	(138)		(231,517)		231,655
Cancellation of treasury stock (in shares)	(1,380,000)				(1,380,000)
Issuance of preferred stock		10	99,990			100,000
Issuance of preferred stock (in shares)		10,000
Deemed dividend's			65,686	(65,686)
Conversion of preferred stock to common stock	26	(10)	(16)
Conversion of preferred stock to common stock (in shares)	255,754	(10,000)
Net loss				(4,894,402)		(4,894,402)
Balance at Jun. 30, 2012	9,497		9,229,157	(16,336,918)	(527,733)	(7,625,997)
Balance (in shares) at Jun. 30, 2012	94,968,905				2,762,084
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of stock options			125,915			125,915
Shares issued for services (July)	3		14,747			14,750
Shares issued for services (August)	5		29,995			30,000
Shares issued for services (October)	5		43,495			43,500
Shares issued for services (in shares) (July)	25,000
Shares issued for services (in shares) (August)	50,000
Shares issued for services (in shares) (October)	50,000
Shares issued as commitment fee (December)	34		299,967			300,001
Shares issued as commitment fee (in shares) (December)	336,625
Shares sold at net of offering costs (December)	11		96,989			97,000
Shares sold at net of offering costs (in shares) (December)	112,208
Exercise of stock options	225		276,975			277,200
Exercise of stock options (in shares)	250,000
Issuance of preferred stock		30	299,970			300,000
Issuance of preferred stock (in shares)		30,000
Deemed dividend's			211,802	(211,802)
Conversion of preferred stock to common stock	59	(30)	(29)
Conversion of preferred stock to common stock (in shares)	592,330	(30,000)
Net loss				(1,217,812)		(1,217,812)
Balance at Dec. 31, 2012	$ 9,839		$ 10,628,983	$ (17,766,532)	$ (527,733)	$ (7,655,443)
Balance (in shares) at Dec. 31, 2012	95,385,068				2,762,084

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Going Concern

6 Months Ended

Dec. 31, 2012

Going Concern [Abstract]

Going Concern

 3.         Going Concern

The accompanying financial statements have been prepared assuming the Company will continue as a going concern. For the period since June 20, 2007 (date of inception) through December 31, 2012, the Company has had a cumulative net loss attributable to common stockholders of $17,766,532 and a working capital deficit of $7,680,062 at December 31, 2012.  As of December 31, 2012, the Company has not emerged from the development stage. In view of these matters, the ability of the Company to continue as a going concern is dependent upon the Company’s ability to generate additional financing. Since inception, the Company has financed its activities principally from the use of equity securities, debt issuance and loans from an officer to pay for its operations. The Company intends on financing its future development activities and its working capital needs largely from the issuance of debt and the sale of equity securities, until such time that funds provided by operations are sufficient to fund working capital requirements. The Company has entered into a financing agreement with Aspire Capital Fund for $10,000,000. The Company does not have the right to commence any sales of its shares to Aspire Capital Fund until the SEC has declared the registration statement filed on January 22, 2012, effective. (See Note 9 referencing Aspire Capital Fund).   If the SEC doesn’t declare our registration effective, there can be no assurance that the Company will be successful at achieving its financing goals at reasonably commercial terms, if at all.

The economic downturn and market instability has made the business climate more volatile and more costly.  If the current equity and credit markets deteriorate further or do not improve, it may make necessary debt or equity financing more difficult, more costly and more dilutive.  Failure to secure any necessary financing in a timely manner and on favorable terms could have a material adverse effect on the Company’s growth strategy, financial performance and stock price and could require the delay of new product development and clinical trial plans.  

These factors raise substantial doubt about the Company's ability to continue as a going concern. The accompanying financial statements do not include any adjustments relating to the recoverability of the recorded assets or the classification of liabilities that may be necessary should the Company be unable to continue as a going concern.

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Related Party Transactions (Detail Textuals) (Kard Scientific, USD $)	3 Months Ended		6 Months Ended		66 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2012	Jun. 30, 2012	Dec. 07, 2007
Kard Scientific
Related Party Transaction [Line Items]
Office space rent (per month)							$ 900
Rent payables included in accrued expenses	54,900		54,900		54,900	49,500
Rent payables included in general and administrative expenses	$ 2,700	$ 2,700	$ 5,400	$ 5,400	$ 54,900

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Stock Options and Warrants (Detail Textuals 5) (USD $)						6 Months Ended
	Sep. 19, 2012 Class A common stock	Jun. 25, 2012 Class A common stock	Dec. 31, 2011 Class A common stock	Dec. 31, 2012 Series Convertible Preferred Stock	Jun. 30, 2012 Series Convertible Preferred Stock	Dec. 31, 2012 Warrants	Dec. 31, 2011 Warrants	Sep. 30, 2012 Warrants	Sep. 24, 2012 Warrants	Sep. 19, 2012 Warrants	Aug. 23, 2012 Warrants	Aug. 01, 2012 Warrants	Jun. 25, 2012 Warrants	Jan. 12, 2012 Warrants	Nov. 30, 2011 Warrants	Oct. 31, 2011 Warrants
Class of Warrant or Right [Line Items]
Common stock purchase							2,500,000		142,315	142,315	154,639	153,061	255,754		2,500,000	2,500,000
Common stock, price per share (in dollars per share)			$ 0.40
Value of warrants outstanding							$ 417,608							$ 470,000
Value of warrants liabilities							1,327,500
Increase in warrant liability							909,892
Value of warrant reclassified from liability to equity						$ 857,000
Number of warrants issued and outstanding								2,500,000	142,315	142,315	154,639	153,061
Exercise price of warrants	0.527	0.39						1.00	0.527	0.527	0.485	0.49	0.39
Preferred stock, shares outstanding				0	0

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Organization And Nature Of Business (Detail Textuals 1) (USD $)												1 Months Ended
	Dec. 31, 2012	Jun. 30, 2012	Dec. 31, 2012 Common Class B Vote	Jun. 30, 2012 Common Class B Vote	Dec. 31, 2012 Series Convertible Preferred Stock	Sep. 19, 2012 Series Convertible Preferred Stock	Sep. 13, 2012 Series Convertible Preferred Stock	Aug. 01, 2012 Series Convertible Preferred Stock	Jun. 30, 2012 Series Convertible Preferred Stock	Jun. 24, 2011 Series Convertible Preferred Stock	Dec. 29, 2010 Stock Incentive Plan 2010 Common Class B Vote	Dec. 29, 2010 Stock Incentive Plan 2010 Common stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Conversion basis of class B common stock in to class A common stock												1.1
Number of votes entitled in class of stock (in votes)			10	10							10
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001			$ 0.001	$ 0.527	$ 0.001	$ 0.49	$ 0.001	$ 0.0001