ACXA 10-Q 09/30/16

0001469709-16-000939.txt : 20161104 0001469709-16-000939.hdr.sgml : 20161104 20161104103557 ACCESSION NUMBER: 0001469709-16-000939 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 40 CONFORMED PERIOD OF REPORT: 20160930 FILED AS OF DATE: 20161104 DATE AS OF CHANGE: 20161104 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Accurexa Inc. CENTRAL INDEX KEY: 0001562107 STANDARD INDUSTRIAL CLASSIFICATION: ELECTROMEDICAL & ELECTROTHERAPEUTIC APPARATUS [3845] IRS NUMBER: 472999657 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-54907 FILM NUMBER: 161973981 BUSINESS ADDRESS: STREET 1: 113 BARKSDALE CITY: NEWARK STATE: DE ZIP: 19711 BUSINESS PHONE: 302-709-1822 MAIL ADDRESS: STREET 1: 113 BARKSDALE CITY: NEWARK STATE: DE ZIP: 19711 FORMER COMPANY: FORMER CONFORMED NAME: Cyto Wave Technologies Inc. DATE OF NAME CHANGE: 20121113 10-Q 1 acxa10q_093016apg.htm ACXA 10-Q 09/30/16 ACXA 10-Q 09/30/16

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

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

For the quarterly period ended September 30, 2016

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

For the transition period from ______ to _____

Commission File Number: 000-54907

ACCUREXA INC.

(Exact name of registrant as specified in its charter)


Delaware	47-2999657
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
113 Barksdale Newark, DE 19711
(Address of principal executive offices, including Zip Code)
(302) 709-1822 (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 Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

[X] Yes

[ ] No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 229.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

[X] Yes

[ ] No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

[ ]

Accelerated filer

[ ]

Non-accelerated filer

[ ] (Do not check if a smaller reporting company)

Smaller reporting company

[X]

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

[ ] Yes

[X] No

APPLICABLE ONLY TO CORPORATE ISSUERS:

Indicate the number of shares outstanding of each of the issuer’s classes of stock, as of the latest practicable date.


Class	Outstanding as of November 4, 2016
Common stock, $0.0001 par value	9,198,954
Convertible preferred stock, $0.0001 par value	1,625

TABLE OF CONTENTS


PART I – FINANCIAL INFORMATION		4
Item 1.	Financial Statements	4
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	13
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	17
Item 4.	Controls and Procedures	17
PART II – OTHER INFORMATION		20
Item 1.	Legal Proceedings	20
Item 1A.	Risk Factors	20
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	20
Item 3.	Exhibits	20
SIGNATURES		21

PART I – FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS


ACCUREXA INC.

INDEX TO INTERIM FINANCIAL STATEMENTS

								Page

Index to Interim Financial Statements								4

Condensed Interim Balance Sheets at September 30, 2016 and December 31, 2015								5

Condensed Interim Statements of Operations for the three and nine months ended September 30, 2016 and 2015								6

Condensed Interim Statements of Cash Flows for the nine months ended September 30, 2016 and 2015								7

Notes to Condensed Interim Financial Statements								8-12


ACCUREXA INC.
*Condensed Interim Balance Sheets*
(Unaudited)

				September 30, 2016		December 31, 2015
ASSETS
Current assets
	Cash and cash equivalents		$	1,458,126	$	1,811,871
	Marketable securities			-		199,906
	Total current assets			1,458,126		2,011,777
Prepaid Assets				1,478,748		2,067,694
Fixed Assets, net				134,113		166,119
	Total assets		$	3,070,987	$	4,245,590

LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
	Accounts payable and other accruals, including related party liabilities of $10,500 as of September 30, 2016 and $149,000 as of December 31, 2015		$	36,084	$	180,782
	Total current liabilities			36,084		180,782
	Convertible Notes, net of unamortized debt discount			472,623		383,980
	Total liabilities			508,707		564,762

Commitments and contingencies
STOCKHOLDERS' EQUITY
	Convertible preferred stock
		Authorized 2,000,000 shares at par value of $0.0001 and with a stated value of $1,000
		Issued and outstanding 1,625 shares as of September 30, 2016 and as of December 31, 2015		-		-
	Common stock
		Authorized 20,000,000 shares at par value of $ 0.0001 each
		Issued and outstanding 9,198,954 shares as of September 30, 2016 and 7,513,816 shares as of December 31, 2015		920		751
	Common Stock Issuable			-		1,132,000
	Additional paid-in capital			14,102,486		12,639,978
	Accumulated deficit			(11,541,126)		(10,091,902)
		Total stockholders' deficit		2,562,279		3,680,828

	Total liabilities and stockholders' deficit		$	3,070,987	$	4,245,590

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


ACCUREXA INC.
*Condensed Interim Statements of Operations*
(Unaudited)

			Three Months Ended September 30, 2016		Three Months Ended September 30, 2015		Nine Months Ended September 30, 2016		Nine Months Ended September 30, 2015

Revenue		$	-	$	-	$	-	$	-

Operating Expenses
	Depreciation and Amortization Expense		10,668		10,668		32,005		31,608
	Research & Development		418,631		196,842		835,651		431,095
	General and Administrative		171,177		267,233		471,910		870,487
Total Operating Expenses			600,477		474,744		1,339,567		1,333,191

Loss from Operations			(600,477)		(474,744)		(1,339,567)		(1,333,191)

Interest Income (Expense)			(49,683)		(18,898)		(109,658)		(51,143)
Gain from Extinguishment of Debt			-		144,505		-		144,505
Loss before provisions for income taxes			(650,160)		(349,137)		(1,449,225)		(1,239,829)

Provision for income taxes			-		-		-		-
Net Loss		$	(650,160)	$	(349,137)		(1,449,225)		(1,239,829)

Loss per common share - basic and fully diluted:		$	(0.07)	$	(0.05)		(0.17)		(0.21)

Weighted average number of basic and fully diluted common shares outstanding			9,097,424		6,423,007		8,644,927		5,979,117

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


ACCUREXA INC.
*Condensed Interim Statements of Cash Flows*
(Unaudited)

				Nine Months Ended September 30, 2016		Nine Months Ended September 30, 2015

Cash flows from operations:
	Loss from continuing operations		$	(1,449,225)	$	(1,239,829)
	Adjustment to reconcile net loss to net cash used in operating activities:
		Depreciation and Amortization		32,005		31,608
		Amortization of non-cash expenses		919,491		904,245
		Amortization of discount on convertible notes		88,643		18,616
	Changes in operating assets and liabilities:
		Accounts payable and other accruals		(144,698)		(113,942)
Net cash used in operations				(553,783)		(399,302)

Investment activities:
	Investment in fixed assets			-		(51,075)
	Redemption of marketable securities			200,038		(200,146)
Net cash used in investment activities				200,038		(251,221)

Financing activities:
	Share subscriptions received			-		1,993,500
Net cash provided by financing activities				-		1,993,500

Net (decrease) / increase in cash				(353,745)		1,342,977

Cash, beginning of period				1,811,871		555,506
Cash, end of period			$	1,458,126	$	1,898,484

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

ACCUREXA INC.

Notes To Interim Financial Statements

(Unaudited)

1 - INTERIM FINANCIAL STATEMENTS

The accompanying interim financial statements have been prepared by the Company without audit. In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations, and cash flows at September 30, 2016, and for all periods presented herein, have been made.

Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted. It is suggested that these interim financial statements be read in conjunction with the financial statements and notes thereto included in the Company's December 31, 2015 audited financial statements. The results of operations for the period ended September 30, 2016 are not necessarily indicative of the operating results for the full year.

2 - GOING CONCERN

The Company's financial statements are prepared using generally accepted accounting principles in the United States of America applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has not yet established an ongoing source of revenues sufficient to cover its operating costs and allow it to continue as a going concern. The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it becomes profitable. If the Company is unable to obtain adequate capital, it could be forced to cease operations.

In order to continue as a going concern, the Company will need, among other things, additional capital resources. Management's plan is to obtain such resources for the Company by obtaining capital from management and significant shareholders sufficient to meet its minimal operating expenses and seeking equity and/or debt financing. However, management cannot provide any assurances that the Company will be successful in accomplishing any of its plans.

The ability of the Company to continue as a going concern is dependent upon its ability to successfully accomplish the plans described in the preceding paragraph and eventually secure other sources of financing and attain profitable operations. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

3 – SIGNIFICANT ACCOUNTING POLICIES

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Recent Accounting Pronouncements

Management has considered all recent accounting pronouncements issued since the last audit of our financial statements. The Company’s management believes that these recent pronouncements will not have a material effect on the Company’s financial statements.

ACCUREXA INC.

Notes To Interim Financial Statements

(Unaudited)

Cash and Cash Equivalents

Cash equivalents comprise of certain highly liquid instruments with a maturity of three months or less when purchased.

Marketable Securities

All marketable securities are classified as available-for-sale since these instruments are readily marketable. These securities are carried at fair value, which is based on readily available market information.

4 – PREPAID ASSETS

On February 18, 2015, the Company entered into a consulting agreement (“Agreement”) with the Capital Communications Group (“Consultant”) under which the Consultant assists the Company in its efforts to gain greater recognition and awareness among relevant investors in the public capital markets on a non-exclusive basis. In connection with the Agreement, the Company issued a four-year Warrant (“Warrant”) to the Consultant under which the Consultant is entitled to purchase from the Company up to 200,000 shares of the Company’s Common Stock (“Warrant Shares”) at an exercise price of $0.50 per Share (“Exercise Price”). The Warrant is exercisable, in whole or in part, during the term commencing on the issuance date of the Warrant on February 18, 2015 and ending on February 18, 2019 (the “Exercise Period”). The 200,000 Warrant Shares are valued at $527,500 based on the Black-Scholes formula and are amortized on a straight-line basis over the 24-month term of the Agreement.

On August 11, 2015 (“Effective Date”), the Company entered into an exclusive license agreement (“ACL License”) with Accelerating Combination Therapies LLC (“ACL”) in regards to the exclusive licensing of the issued U.S. Patent No. 8,895,597 B2 Combination of Local Temozolomide with Local BCNU (“Patent Rights”). Under the ACL License, the Company is required to pay ACL a license issue fee of 1,000,000 shares of the Company’s common stock to be issued within 6 months after the Effective Date. The 1,000,000 shares of common stock are valued at $1.13 per share, equal to the publicly traded share price on the Effective Date, are capitalized in the amount of $1,130,000, and amortized over an expected patent life of 15 years.

5 – FIXED ASSETS

The Company has purchased equipment to support the development of its prototype device which are capitalized in the amount of $134,113 as fixed assets on the Company’s balance sheet. The equipment is amortized on a straight-line basis over 5 years.

ACCUREXA INC.

Notes To Interim Financial Statements

(Unaudited)

6 - CONVERTIBLE NOTES

On July 25, 2013, the Company entered into a secured convertible note (“Note”) under which the Company received $350,000 from the convertible note holder (“Holder”) and is obligated to pay to the Holder the full principal amount after 36 months from the date of the Note, plus an interest at the rate of 10.0% per year payable at the end of each year from the date of the Note. The Note was extended for 12 months on July 25, 2016. The Holder has the right to convert the Note, in whole or in part, into shares of common stock of the Company (“Common Stock”) at a fixed rate of $0.50 per share (the “Conversion Price”) at any time. The Company may prepay the Note in whole or in part at any time for cash on 15 business days’ prior written notice, subject to the right of the Holder to convert into shares of Common Stock of the Company prior to any prepayment. The Note agreement was filed on August 14, 2013 as an exhibit to Form 10-Q for the three months ended June 30, 2013.

On July 15, 2014, the Company entered into a secured convertible note (“Note”) under which the Company received $20,000 from the convertible note holder (“Holder”) and is obligated to pay to the Holder the full principal amount after 36 months from the date of the Note. The Holder has the right to convert the Note, in whole or in part, into shares of common stock of the Company (“Common Stock”) at a "Variable Conversion Price" of 50% multiplied by the Market Price (representing a discount rate of 50%). “Market Price” means the average of the Closing Trading Prices for the Common Stock during the ten (10) Trading Day period ending on the latest complete Trading Day prior to the Conversion Date. The Company may prepay the Note in whole or in part at any time for cash on 15 business days’ prior written notice, subject to the right of the Holder to convert into shares of Common Stock of the Company prior to any prepayment. The Company has determined the value associated with the beneficial conversion feature in connection with the notes to be $20,000. The aggregate beneficial conversion feature was accreted and charged to interest expense in the amount of $8,060 as of September 30, 2015, and will be amortized until July 15, 2017.

On January 12, 2015, the Company and the Lim Development Group (“Consultant”) entered into a consulting agreement (“Agreement”) under which the Consultant provides scientific advisory to the Company in the development, partnering and commercialization of the “Microinjection Brain Catheter” (a.k.a. BranchPoint device) that the Company exclusively licensed from the University of California San Francisco (“UCSF”) on September 16, 2014. The Consultant will also serve as a member of the Company’s newly formed Scientific Advisory Board. The term of the Agreement shall be two years and may be extended by mutual agreement of both parties. As consideration for provided services during the term of the Agreement, the Consultant shall receive either a project fee or an hourly rate, either of which will be determined and agreed upon by both parties prior to commencement of any work or project. Under the Agreement, the Company also issued a promissory note (“Note”) in the amount of $200,000 and at an interest rate of 5.00% per annum to the Consultant. Under the Note, the Consultant shall have the right, exercisable at any time at the Consultant’s sole discretion, to convert all or a portion of the outstanding principal amount of and all accrued interest under the Note, in whole or in part, into shares of common stock of the Company (the “Shares”) at a conversion price of $0.20 per share. The Shares are issuable pursuant to Regulation D under the Securities Act of 1933, as amended, are to be exempt from registration by reason of Section 4(2) of the Securities Act of 1933, as amended (the “Act”), and are to bear an appropriate restrictive legend. A full description of the Agreement was filed as exhibit 10.1 and of the Note was filed as exhibit 10.2 to the Form 8-K as of January 13, 2015.

ACCUREXA INC.

Notes To Interim Financial Statements

(Unaudited)

7 – CONVERTIBLE PREFERRED STOCK

On June 22, 2015, the Company closed a private placement of 2,250 shares of the Company's convertible preferred stock for gross proceeds to the Company of $2,250,000 and net proceeds of $1,993,500. The convertible preferred stock is convertible into shares of common stock of the Company at a conversion price of $1.25 per share. The Preferred Stock has no dividend rights or liquidation preference. If dividends are declared on the Common Stock, the holders of the Preferred Stock shall be entitled to participate in such dividends on an as-converted-to-common stock basis. The Company recorded a beneficial conversion feature of $1,980,000 based on the fair value of the common stock and the conversion rate as of the date of the offering. This amount was recorded as a deemed distribution during the period of the offering.

8 - WARRANTS

In connection with the private placement of 2,250 shares of the Company's convertible preferred stock on June 22, 2015, we issued to the investors warrants to purchase up to 1,800,000 shares of common stock. The warrants have an exercise price of $1.50 per share and are exercisable for 4 years. We also issued an aggregate of 162,000 warrants that were similar to the warrants issued to investors and are exercisable at $1.50 per share for 4 years, to our placement agent and its designees.

The following is a summary of the status of all of the Company’s stock warrants as of September 30, 2016 and changes during the periods ended on that date:


	Number of Warrants	Weighted-Average Exercise Price
Outstanding at January 1, 2016	2,162,000	$ 1.41
Granted	-	$ 0.00
Exercised	-	$ 0.00
Cancelled	-	$ 0.00
Outstanding at September 30, 2016	2,162,000	$ 1.41
Warrants exercisable at September 30, 2016	2,162,000	$ 1.41

9 - FORM S-1 REGISTRATION STATEMENT

ACCUREXA INC.

Notes To Interim Financial Statements

(Unaudited)

(“Investor Warrants”) to purchase up to 1,800,000 shares of Common Stock. The Warrants have an exercise price of $1.50 per share and are exercisable through June 21, 2019. The shares of the Company’s common stock issuable on exercise of the Investor Warrants are registered under the Company’s Form S-1. H.C. Wainwright & Co., LLC (“Placement Agent”) acted as the exclusive placement agent for the placement of the Company’s Preferred Stock and Investor Warrants. The Placement Agent purchased securities in the offering on the same terms and conditions as the other investors. In addition, the Placement Agent and its designees received an aggregate of 162,000 warrants to purchase the Company’s common stock at a price of $1.50 per share through June 21, 2019 (“Agent Warrants”). The shares underlying the Agent Warrants are registered under the Company’s Form S-1. The Company will not receive any proceeds from the sale of shares sold by the Selling Stockholders or from the conversion of Preferred Stock. However, the Company will receive proceeds of $1.50 per share upon the exercise of any Investor Warrants or Agent Warrants. The Company’s Form S-1 registration statement became effective on August 10, 2015.

On August 11, 2015, the Selling Stockholders converted an aggregate of 375 convertible preferred stock into 300,000 shares of common stock that were issued by the Company to the Selling Stockholders.

On September 1, 2015, the Placement Agent converted an aggregate of 250 convertible preferred stock into 200,000 shares of common stock that were issued by the Company to the Placement Agent.

10 - SUBSEQUENT EVENTS

On October 17, 2016, we announced a collaboration with StemImmune to develop its stem cell-mediated immunotherapy for the treatment of cancer, such as brain cancer. StemImmune's immunotherapy uses the stealth anti-cancer payload carrying and tumor seeking capacities of a patient's own readily available (adult) stem cells to target cancer. The patient's immune system cannot recognize and react to the "Trojan Horse" stem cells, because they are the patient's own. To date, StemImmune has treated 25 cancer patients with its proprietary technology in a Phase 1 clinical trial that showed that its stem cell-mediated immunotherapy was safe and well-tolerated with no adverse events reported, and demonstrated potential anti-tumor activity which supports further investigation in clinical trials. All patients received treatment through a minimally invasive outpatient procedure.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

Forward Looking Statements

This quarterly report on Form 10-Q and other reports that we file with the SEC contain statements that are considered forward-looking statements. Forward-looking statements give the Company’s current expectations, plans, objectives, assumptions or forecasts of future events. All statements other than statements of current or historical fact contained in this quarterly report, including statements regarding the Company’s future financial position, business strategy, budgets, projected costs and plans and objectives of management for future operations, are forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “anticipate,” “estimate,” “plans,” “potential,” “projects,” “ongoing,” “expects,” “management believes,” “we believe,” “we intend,” and similar expressions. These statements are based on the Company’s current plans and are subject to risks and uncertainties, and as such the Company’s actual future activities and results of operations may be materially different from those set forth in the forward-looking statements. Any or all of the forward-looking statements in this periodic report may turn out to be inaccurate and as such, you should not place undue reliance on these forward-looking statements. The Company has based these forward-looking statements largely on its current expectations and projections about future events and financial trends that it believes may affect its financial condition, results of operations, business strategy and financial needs. The forward-looking statements can be affected by inaccurate assumptions or by known or unknown risks, uncertainties and assumptions due to a number of factors, including:

dependence on key personnel;

competitive factors;

degree of success of clinical trials and research and development programs;

the operation of our business; and

general economic conditions in the United States and Worldwide.

These forward-looking statements speak only as of the date on which they are made, and except to the extent required by federal securities laws, we undertake no obligation to update any forward-looking statements to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events. In addition, we cannot assess the impact of each factor on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. All subsequent written and oral forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by the cautionary statements contained in this periodic report.

Use of Terms

Except as otherwise indicated by the context and for the purposes of this report only, references in this report to:

“Accurexa”, “the “Company,” “we,” “us,” or “our,” are to the business of Accurexa Inc., a Delaware corporation;

“SEC” are to the Securities and Exchange Commission;

“Securities Act” are to the Securities Act of 1933, as amended;

“Exchange Act” are to the Securities Exchange Act of 1934, as amended;

“U.S. dollars,” “dollars” and “$” are to the legal currency of the United States.

You should read the following plan of operation together with our financial statements and related notes appearing elsewhere in this quarterly report and the most recent Form 10-K. This plan of operation contains forward-looking statements that involve risks, uncertainties, and assumptions. The actual results may differ materially from those anticipated in these forward-looking statements as a result of certain factors.

Overview

We are a development stage company. We were incorporated in Delaware on August 29, 2012. We are focused on developing novel neurological therapies to be directly delivered into specific regions of the brain. We are developing our ACX-31 program for the local delivery of temozolomide as adjunctive therapy to BCNU, both chemotherapeutics, to brain tumor sites. Our ACX-31 program is based on an issued patent licensed from Accelerating Combination Therapies LLC which is co-owned by Dr. Henry Brem, Director of the Neurosurgery Department at Johns Hopkins University (“ACL License”). We are collaborating in the development of our ACX-31 program with Dr. Henry Brem who built one of the largest brain tumor research and treatment centers in the world at Johns Hopkins University. Dr. Brem is a pioneer in the development of local drug delivery treatments, and invented and developed Gliadel^® which is a FDA approved, local chemotherapy for the treatment of glioblastoma multiforme. We entered into an agreement with the Yissum Research Development Company of The Hebrew University of Jerusalem Ltd. (“Yissum”) to develop and supply a polymeric formulation of a combination of temozolomide and BCNU. Professor Avi Domb of The Hebrew University of Jerusalem leads the development efforts provided by Yissum.

We are also developing our BranchPoint device that can potentially deliver therapeutics through the radial deployment of a flexible delivery catheter to large and anatomically complex brain targets through a single initial brain penetration. Our BranchPoint device was originally developed at the University of California, San Francisco (UCSF) with $1.8 million in funding from the California Institute for Regenerative Medicine (CIRM). It is based on a neurosurgical delivery platform that we have exclusively licensed from UCSF. It can potentially enable new approaches to neurological therapy and be modified for the delivery of a broad range of novel therapeutics, such as stem cells to treat neurodegenerative diseases, chemotherapeutics to brain tumors and gene therapy vectors. On November 4, 2015, UCSF requested a pre-IND meeting with the FDA to discuss a collaborative program between UCSF and us to evaluate a combined stem cell/gene transfer candidate therapeutic CNS10-NPC GDNF for the treatment of Parkinson's Disease using our BranchPoint delivery device. UCSF received a written response from the FDA on March 21, 2016 which provided guidance on the non-clinical activities that are necessary to enable the filing of a future potential IND application. CNS10-NPC are human fetal neural stem cells that express Glial-Derived Neurotrophic Factor (GDNF) in the treatment of Parkinson's Disease, and are expected to be supplied by the Cedars-Sinai Regenerative Medicine Institute in support of IND (Investigational New Drug) enabling studies.

We cannot assure you that we will be successful with our development activities.

Recent Developments

On July 7, 2016, we filed a new patent application related to our proprietary formulation used in our ACX-31 program.

On August 16, 2016, we received FDA’s written response to our pre-IND meeting request regarding our ACX-31 program. The FDA confirmed the acceptability of a 505(b)(2) application pathway with one first-in-human Phase 2 clinical trial followed by one Phase 3 clinical trial. Key Points of the written response:

Acceptability of a 505(b)(2) application pathway confirmed

Pharmacology studies appear adequate

Non-clinical studies appear adequate with the exception of one GLP-compliant toxicology study in a single animal species using the route and schedule of administration proposed for the planned Phase 2 trial to be required

Phase 2 clinical trial strongly recommended to be conducted in patients with relapsed/recurrent glioblastoma

Proposed Phase 2 trial primary endpoints appear adequate

If an adequately designed Phase 2 trial demonstrates tolerability and suggests activity, FDA would encourage Accurexa to request an End-of-Phase 2 meeting to discuss the design of an adequate and well-controlled, randomized Phase 3 trial

On September 7, 2016, we announced a collaboration with DelMar Pharmaceuticals to develop a novel formulation for the local delivery of combination chemotherapy for the treatment of brain cancer and other solid tumors. Under the terms of the collaboration agreement DelMar will supply VAL-083 (dianhydrogalactitol) to be formulated with our ACX-31 implantable polymer wafer to locally deliver VAL-083 in combination with temozolomide and/or BCNU for the treatment of brain cancer. DelMar has been granted an exclusive option to license or acquire and commercialize product candidates and intellectual property resulting from the research.

Liquidity and Capital Resources and Plan of Operation

The reader is referred to our financial statements included elsewhere herein. As of September 30, 2016 we had $1,458,126 in cash and cash equivalents. Our current plan is to continue the development of our two programs in our pipeline.

We are developing our ACX-31 program for the delivery of temozolomide as adjunctive therapy to BCNU, both chemotherapeutics, to brain tumor sites. Temozolomide is a generic, approved chemotherapy drug that is indicated for the treatment of adult patients with newly diagnosed glioblastoma multiforme concomitantly with radiotherapy and then as maintenance treatment. Local delivery of temozolomide has been demonstrated to be superior to oral administration in an animal model. In the scientific publication at Johns Hopkins University Brem S, Tyler BM, Li K, Pradilla G, Legnani F, Caplan J, et al. Local delivery of temozolomide by biodegradable polymers is superior to oral administration in a rodent glioma model. Cancer Chemother Pharmacol 2007;60:643-50, it was demonstrated that that intracranial concentrations of temozolomide increased threefold compared with orally delivered temozolomide. In a rodent glioma model, animals treated with a single temozolomide polymer (50% w/w) had a median survival of 28 days (P < 0.001 vs. controls, P < 0.001 vs. oral treatment), whereas animals treated with oral temozolomide had a median survival of 22 days compared to control animals (median survival of 13 days). Animals treated with two temozolomide polymers (50% w/w) had a median survival of 92 days (P < 0.001 vs. controls, P < 0.001 vs. oral treatment). The percentage of long-term survivors (LTS) for groups receiving intracranial temozolomide ranged from 25 to 37.5%; there were no LTS with oral temozolomide treatment. Animals treated with radiation therapy (XRT) and intracranial temozolomide (median survival not reached, LTS = 87.5%) demonstrated improved survival compared to those with intracranial temozolomide alone (median survival, 41 days; LTS = 37.5%), or oral temozolomide and XRT (median survival, 43 days, LTS = 38.9%). BCNU (carmustine) is a chemotherapy drug that is contained in Gliadel^®, a biodegradable polymer that is implanted locally into the resection cavity after surgical removal of a brain tumor and is indicated for the treatment of newly diagnosed and recurrent glioblastoma multiforme. In another scientific publication at Johns Hopkins University Renard Recinos V, Tyler BM, Brem H, et al. Combination of intracranial temozolomide with intracranial carmustine improves survival when compared with

either treatment alone in a rodent glioma model. Neurosurgery 2010; 66:530-537, it was shown that the additive effect of combined delivery of local temozolomide with local BCNU, especially in combination with radiotherapy, was significantly more effective than delivery of either drug alone or one systemically and one locally, either with or without radiation. Groups treated with combination of local temozolomide, local BCNU and radiation therapy had 75% long-term survivors.

We are developing our BranchPoint device that can potentially deliver therapeutics through the radial deployment of a flexible delivery catheter to large and anatomically complex brain targets through a single initial brain penetration. It can potentially enable new approaches to neurological therapy and be modified for the delivery of a broad range of novel therapeutics, such as stem cells to treat neurodegenerative diseases, chemotherapeutics to brain tumors and gene therapy vectors. On November 4, 2015, UCSF requested a pre-IND meeting with the FDA to discuss a collaborative program between UCSF and us to evaluate a combined stem cell/gene transfer candidate therapeutic CNS10-NPC GDNF for the treatment of Parkinson's Disease using our BranchPoint delivery device. UCSF received a written response from the FDA on March 21, 2016 which provided guidance on the non-clinical activities that are necessary to enable the filing of a future potential IND application. CNS10-NPC are human fetal neural stem cells that express Glial-Derived Neurotrophic Factor (GDNF) in the treatment of Parkinson's Disease, and are expected to be supplied by the Cedars-Sinai Regenerative Medicine Institute in support of IND enabling studies.

The development of our programs is estimated to cost approximately $5-7 million over 4-5 years as a standalone company. However, we may seek to pursue a strategic collaboration partnership which may accelerate the development timeline, share expenses, and also provide access to ex-US markets. The development of our programs may also cost substantially more than $5-7 million and may require a substantially longer development timeline than 4-5 years. Higher development expenses and delays may be caused by but are not limited to sub-optimal product performance and continued product optimization cycles, adverse clinical results and repeat of clinical trials, or delays of an FDA approval. In such a scenario, we may not be able to secure sufficient funding or a strategic collaboration partnership and could cease operations under such circumstances.

We are actively seeking additional capital investment. We cannot assure you that we will have access to the necessary funding or that if available it will be available on terms that are not dilutive to our present shareholders. If the funding is not available, we may have to severely curtail or cease operations.

Results of Operations

Revenues

We had no revenues as a development stage company for the nine months ended September 30, 2016 and 2015, respectively.

Operating Expenses

Depreciation and Amortization Expenses: Depreciation and Amortization expenses were $32,005 and $31,608 for the nine months ended September 30, 2016 and 2015, respectively. The expenses were primarily incurred by the purchase of equipment required to support the development of our prototype device. The cost of the equipment is amortized on a straight-line basis over 5 years.

Research and Development: Research and development expenses were $835,651 and $431,095 for the nine months ended September 30, 2016 and 2015, respectively. The increase was due to the development efforts, formulation work and regulatory filings with the FDA associated with our ACX-31 program.

General and Administrative: General and administrative expenses were $471,910 and $870,487 for the nine months ended September 30, 2016 and 2015, respectively. The decrease was primarily due to the expiration of the consulting agreements with our investor relations and media consultants and associated share issuances.

Net Losses

We had net losses of $1,449,225 and $1,239,829 for the nine months ended September 30, 2016 and 2015, respectively. The losses were primarily incurred by the development efforts, formulation work and regulatory filings with the FDA associated with our ACX-31 program and professional fees.

Off-Balance Sheet Arrangements

We do not have any off balance sheet arrangements that are reasonably likely to have a current or future effect on our financial condition, revenues, and results of operations, liquidity or capital expenditures.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

As a smaller reporting company” (as defined by §229.10(f)(1)), the Company is not required to provide the information required by this Item.

ITEM 4. CONTROLS AND PROCEDURES

Regulations under the Securities Exchange Act of 1934 (the “Exchange Act”) require public companies to maintain “disclosure controls and procedures,” which are defined as controls and other procedures that are designed to ensure that information required to be disclosed by the issuer in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to the issuer's management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

We conducted an evaluation, with the participation of our Chief Executive Officer who is also our Principal Financial Officer, of the effectiveness of our disclosure controls and procedures as of September 30, 2016. Based on that evaluation, our Chief Executive Officer and Principal Financial Officer has concluded that as of September 30, 2016, our disclosure controls and procedures were not effective at the reasonable assurance level due to the material weaknesses described below.

In light of the material weaknesses described below, we performed additional analysis and other post-closing procedures to ensure our financial statements were prepared in accordance with generally accepted accounting principles. Accordingly, we believe that the financial statements included in this report fairly present, in all material respects, our financial condition, results of operations and cash flows for the periods presented.

A material weakness is a control deficiency (within the meaning of the Public Company Accounting Oversight Board (PCAOB) Auditing Standard No. 2) or combination of control deficiencies that result in more than a remote likelihood that a material misstatement of the annual or interim financial statements will not be prevented or detected. Management has identified the following two material weaknesses which have caused management to conclude that, as of September 30, 2016, our disclosure controls and procedures were not effective at the reasonable assurance level:

1. We do not have written documentation of our internal control policies and procedures. Written documentation of key internal controls over financial reporting is a requirement of Section 404 of the Sarbanes-Oxley Act which is applicable to us for the quarter ending September 30, 2016. Management evaluated the impact of our failure to have written documentation of our internal controls and procedures on our assessment of our disclosure controls and procedures and has concluded that the control deficiency that resulted represented a material weakness.

2. We do not have sufficient segregation of duties within accounting functions, which is a basic internal control. Due to our size and nature, segregation of all conflicting duties may not always be possible and may not be economically feasible. However, to the extent possible, the initiation of transactions, the custody of assets and the recording of transactions should be performed by separate individuals. Management evaluated the impact of our failure to have segregation of duties on our assessment of our disclosure controls and procedures and has concluded that the control deficiency that resulted represented a material weakness.

To address these material weaknesses, management performed additional analyses and other procedures to ensure that the financial statements included herein fairly present, in all material respects, our financial position, results of operations and cash flows for the periods presented.

Management's Report on Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is defined in Rule 13a-15(f) or 15d-15(f) promulgated under the Exchange Act as a process designed by, or under the supervision of, the issuer’s principal executive and principal financial officers and effected by the issuer’s board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America and includes those policies and procedures that:


	1.	Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the issuer;

	2.	Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with accounting principles generally accepted in the United States of America and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the issuer; and

	3.	Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the issuer’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Because of the inherent limitations of internal control, there is a risk that material misstatements may not be prevented or detected on a timely basis by internal control over financial reporting. However, these inherent limitations are known features of the financial reporting process. Therefore, it is possible to design into the process safeguards to reduce, though not eliminate, this risk.

As of the end of our most recent quarter, management assessed the effectiveness of our internal control over financial reporting based on the criteria for effective internal control over financial reporting established in Internal Control-Integrated Framework issued by the Committee of Sponsoring

Organizations of the Treadway Commission ("COSO") and SEC guidance on conducting such assessments. Based on that evaluation, they concluded that, as of September 30, 2016, such internal control over financial reporting was not effective. This was due to deficiencies that existed in the design or operation of our internal control over financial reporting that adversely affected our internal controls and that may be considered to be material weaknesses.

The matters involving internal control over financial reporting that our management considered to be material weaknesses under the standards of the Public Company Accounting Oversight Board were: (1) lack of a functioning audit committee due to a lack of a majority of independent members and a lack of a majority of outside directors on our board of directors, resulting in ineffective oversight in the establishment and monitoring of required internal controls and procedures; and (2) inadequate segregation of duties consistent with control objectives of having segregation of the initiation of transactions, the recording of transactions and the custody of assets. The aforementioned material weaknesses were identified by our Chief Executive Officer in connection with the review of our financial statements as of September 30, 2016.

Management believes that the material weaknesses set forth in items (1) and (2) above did not have an effect on our financial results. However, management believes that the lack of a functioning audit committee and the lack of a majority of outside directors on our board of directors results in ineffective oversight in the establishment and monitoring of required internal controls and procedures, which could result in a material misstatement in our financial statements in future periods.

This quarterly report does not include an attestation report of the Company's registered public accounting firm regarding internal control over financial reporting. Management's report was not subject to attestation by the Company's registered public accounting firm pursuant to temporary rules of the SEC that permit the Company to provide only the management's report in this annual report.

Management's Remediation Initiatives

In an effort to remediate the identified material weaknesses and other deficiencies and enhance our internal controls, we have initiated, or plan to initiate, the following series of measures:

We will increase our personnel resources and technical accounting expertise within the accounting function when funds are available to us. First, we will create a position to segregate duties consistent with control objectives of having separate individuals perform (i) the initiation of transactions, (ii) the recording of transactions and (iii) the custody of assets. Second, we will create a senior position to focus on financial reporting and standardizing and documenting our accounting procedures with the goal of increasing the effectiveness of the internal controls in preventing and detecting misstatements of accounting information. Third, we plan to appoint one or more outside directors to our board of directors who shall be appointed to an audit committee resulting in a fully functioning audit committee who will undertake the oversight in the establishment and monitoring of required internal controls and procedures such as reviewing and approving estimates and assumptions made by management when funds are available to us.

Management believes that the appointment of one or more outside directors, who shall be appointed to a fully functioning audit committee, will remedy the lack of a functioning audit committee and a lack of a majority of outside directors on our Board. Due to our small size and limited resources we could experience delays in implementation.

PART II – OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

We are not currently a defendant in any legal proceeding or governmental proceeding nor are we currently aware of any pending legal proceeding or governmental proceeding proposed to be initiated against us. There are no proceedings in which any of our current directors, executive officers or affiliates, or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to us.

ITEM 1A. RISK FACTORS

The Company, as a “smaller reporting company” (as defined by §229.10(f)(1)), is not required to provide the information required by this Item.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES

On July 20, 2016, we issued 450,000 shares of the Company’s common stock in connection with entering into a patent assignment agreement under which the Company was assigned the patent rights to the new patent application related to the proprietary formulation used in our ACX-31 program. These shares were issued pursuant to Regulation D under the Securities Act of 1933, as amended, are exempt from registration by reason of Section 4(2) of the Securities Act of 1933, as amended (the “Act”), and bear an appropriate restrictive legend.

On August 8, 2016, we issued 18,138 shares of the Company’s common stock in connection with the consulting agreement that we entered into with an investor relations consultant on February 4, 2015. These shares were issued pursuant to Regulation D under the Securities Act of 1933, as amended, were exempt from registration by reason of Section 4(2) of the Securities Act of 1933, as amended (the “Act”), and bear an appropriate restrictive legend.

ITEM 3. EXHIBITS


Exhibit No.		Description

31.1		Certifications of Principal Executive Officer filed pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2		Certifications of Principal Financial Officer filed pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1		Certifications of Principal Executive Officer furnished pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2		Certifications of Principal Financial Officer furnished pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

SIGNATURES

Pursuant to the requirements 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.

ACCUREXA INC.

November 4, 2016

/s/ George Yu

George Yu

President and Chief Executive Officer

(Principal Executive Officer)

EXHIBIT INDEX


Exhibit No.		Description

31.1		Certifications of Principal Executive Officer filed pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2		Certifications of Principal Financial Officer filed pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1		Certifications of Principal Executive Officer furnished pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2		Certifications of Principal Financial Officer furnished pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

EX-31.1 2 ex31_1apg.htm EXHIBIT 31.1 Exhibit 31.1 Certification

Exhibit 31.1

CERTIFICATIONS

I, George Yu, certify that:


1.	I have reviewed this quarterly report on Form 10-Q of ACCUREXA INC.;

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 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, including its consolidated subsidiaries, 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 (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

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 registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

	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 the 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.


Date: November 4, 2016

/s/ George Yu
George Yu
Chief Executive Officer
(Principal Executive Officer)

EX-31.2 3 ex31_2apg.htm EXHIBIT 31.2 Exhibit 31.2 Certification

Exhibit 31.2

CERTIFICATIONS

I, George Yu, certify that:


1.	I have reviewed this quarterly report on Form 10-Q of ACCUREXA INC.;

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 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, including its consolidated subsidiaries, 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 (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

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 registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

	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 the 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.


Date: November 4, 2016

/s/ George Yu
George Yu
Principal Financial Officer
(Principal Financial and Accounting Officer)

EX-32.1 4 ex32_1apg.htm EXHIBIT 32.1 Exhibit 32.1 Certification

Exhibit 32.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906

OF THE SARBANES-OXLEY ACT OF 2002

The undersigned, George Yu, the Chief Executive Officer of ACCUREXA INC. (the “Company”), DOES HEREBY CERTIFY that:

1. The Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2016 (the “Report”), fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934; and

2. Information contained in the Report fairly presents, in all material respects, the financial condition and results of operation of the Company.

IN WITNESS WHEREOF, each of the undersigned has executed this statement this 4^th day of November, 2016.


	/s/ George Yu
	George Yu
	Chief Executive Officer
	(Principal Executive Officer)

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

The forgoing certification is being furnished to the Securities and Exchange Commission pursuant to § 18 U.S.C. Section 1350. It is not being filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and is not to be incorporated by reference into any filing of the Company, whether made before or after the date hereof, regardless of any general incorporation language in such filing.

EX-32.2 5 ex32_2apg.htm EXHIBIT 32.2 Exhibit 32.2 Certification

Exhibit 32.2

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906

OF THE SARBANES-OXLEY ACT OF 2002

The undersigned, George Yu, the Principal Financial Officer of ACCUREXA INC (the “Company”), DOES HEREBY CERTIFY that:

2. Information contained in the Report fairly presents, in all material respects, the financial condition and results of operation of the Company.

IN WITNESS WHEREOF, each of the undersigned has executed this statement this 4^th day of November, 2016.


	/s/ George Yu
	George Yu
	Principal Financial Officer

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1 - INTERIM FINANCIAL STATEMENTS   The accompanying interim financial statements have been prepared by the Company without audit. In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations, and cash flows at September 30, 2016, and for all periods presented herein, have been made.   Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted. It is suggested that these interim financial statements be read in conjunction with the financial statements and notes thereto included in the Company's December 31, 2015 audited financial statements. The results of operations for the period ended September 30, 2016 are not necessarily indicative of the operating results for the full year.

3 SIGNIFICANT ACCOUNTING POLICIES   Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.   Recent Accounting Pronouncements Management has considered all recent accounting pronouncements issued since the last audit of our financial statements. The Companys management believes that these recent pronouncements will not have a material effect on the Companys financial statements.   Cash and Cash Equivalents Cash equivalents comprise of certain highly liquid instruments with a maturity of three months or less when purchased.   Marketable Securities All marketable securities are classified as available-for-sale since these instruments are readily marketable. These securities are carried at fair value, which is based on readily available market information.

4 PREPAID ASSETS   On January 12, 2015, the Company and the Lim Development Group (Consultant) entered into a consulting agreement (Agreement) under which the Consultant provides scientific advisory to the Company in the development, partnering and commercialization of the Microinjection Brain Catheter (a.k.a. BranchPoint device) that the Company exclusively licensed from the University of California San Francisco (UCSF) on September 16, 2014. As consideration for provided services, the Company issued a promissory note (Note) in the amount of $200,000 at an interest rate of 5.00% per annum to the Consultant. The principal amount of the Note is amortized on a straight-line basis over the 24-month term of the Agreement.   On February 18, 2015, the Company entered into a consulting agreement (Agreement) with the Capital Communications Group (Consultant) under which the Consultant assists the Company in its efforts to gain greater recognition and awareness among relevant investors in the public capital markets on a non-exclusive basis. In connection with the Agreement, the Company issued a four-year Warrant (Warrant) to the Consultant under which the Consultant is entitled to purchase from the Company up to 200,000 shares of the Companys Common Stock (Warrant Shares) at an exercise price of $0.50 per Share (Exercise Price). The Warrant is exercisable, in whole or in part, during the term commencing on the issuance date of the Warrant on February 18, 2015 and ending on February 18, 2019 (the Exercise Period). The 200,000 Warrant Shares are valued at $527,500 based on the Black-Scholes formula and are amortized on a straight-line basis over the 24-month term of the Agreement.   On August 11, 2015 (Effective Date), the Company entered into an exclusive license agreement (ACL License) with Accelerating Combination Therapies LLC (ACL) in regards to the exclusive licensing of the issued U.S. Patent No. 8,895,597 B2 Combination of Local Temozolomide with Local BCNU (Patent Rights). Under the ACL License, the Company is required to pay ACL a license issue fee of 1,000,000 shares of the Companys common stock to be issued within 6 months after the Effective Date. The 1,000,000 shares of common stock are valued at $1.13 per share, equal to the publicly traded share price on the Effective Date, are capitalized in the amount of $1,130,000, and amortized over an expected patent life of 15 years.   5 FIXED ASSETS   The Company has purchased equipment to support the development of its prototype device which are capitalized in the amount of $134,113 as fixed assets on the Companys balance sheet. The equipment is amortized on a straight-line basis over 5 years.

6 - CONVERTIBLE NOTES   On July 25, 2013, the Company entered into a secured convertible note (Note) under which the Company received $350,000 from the convertible note holder (Holder) and is obligated to pay to the Holder the full principal amount after 36 months from the date of the Note, plus an interest at the rate of 10.0% per year payable at the end of each year from the date of the Note. The Note was extended for 12 months on July 25, 2016. The Holder has the right to convert the Note, in whole or in part, into shares of common stock of the Company (Common Stock) at a fixed rate of $0.50 per share (the Conversion Price) at any time. The Company may prepay the Note in whole or in part at any time for cash on 15 business days prior written notice, subject to the right of the Holder to convert into shares of Common Stock of the Company prior to any prepayment. The Note agreement was filed on August 14, 2013 as an exhibit to Form 10-Q for the three months ended June 30, 2013.   On July 15, 2014, the Company entered into a secured convertible note (Note) under which the Company received $20,000 from the convertible note holder (Holder) and is obligated to pay to the Holder the full principal amount after 36 months from the date of the Note. The Holder has the right to convert the Note, in whole or in part, into shares of common stock of the Company (Common Stock) at a "Variable Conversion Price" of 50% multiplied by the Market Price (representing a discount rate of 50%). Market Price means the average of the Closing Trading Prices for the Common Stock during the ten (10) Trading Day period ending on the latest complete Trading Day prior to the Conversion Date. The Company may prepay the Note in whole or in part at any time for cash on 15 business days prior written notice, subject to the right of the Holder to convert into shares of Common Stock of the Company prior to any prepayment. The Company has determined the value associated with the beneficial conversion feature in connection with the notes to be $20,000. The aggregate beneficial conversion feature was accreted and charged to interest expense in the amount of $8,060 as of September 30, 2015, and will be amortized until July 15, 2017.   On January 12, 2015, the Company and the Lim Development Group (Consultant) entered into a consulting agreement (Agreement) under which the Consultant provides scientific advisory to the Company in the development, partnering and commercialization of the Microinjection Brain Catheter (a.k.a. BranchPoint device) that the Company exclusively licensed from the University of California San Francisco (UCSF) on September 16, 2014. The Consultant will also serve as a member of the Companys newly formed Scientific Advisory Board. The term of the Agreement shall be two years and may be extended by mutual agreement of both parties. As consideration for provided services during the term of the Agreement, the Consultant shall receive either a project fee or an hourly rate, either of which will be determined and agreed upon by both parties prior to commencement of any work or project. Under the Agreement, the Company also issued a promissory note (Note) in the amount of $200,000 and at an interest rate of 5.00% per annum to the Consultant. Under the Note, the Consultant shall have the right, exercisable at any time at the Consultants sole discretion, to convert all or a portion of the outstanding principal amount of and all accrued interest under the Note, in whole or in part, into shares of common stock of the Company (the Shares) at a conversion price of $0.20 per share. The Shares are issuable pursuant to Regulation D under the Securities Act of 1933, as amended, are to be exempt from registration by reason of Section 4(2) of the Securities Act of 1933, as amended (the Act), and are to bear an appropriate restrictive legend. A full description of the Agreement was filed as exhibit 10.1 and of the Note was filed as exhibit 10.2 to the Form 8-K as of January 13, 2015.

7 CONVERTIBLE PREFERRED STOCK   On June 22, 2015, the company closed a private placement of 2,250 shares of the Company's convertible preferred stock for gross proceeds to the Company of $2,250,000 and net proceeds of $1,993,500. The convertible preferred stock is convertible into shares of common stock of the Company at a conversion price of $1.25 per share. The Preferred Stock has no dividend rights or liquidation preference. If dividends are declared on the Common Stock, the holders of the Preferred Stock shall be entitled to participate in such dividends on an as-converted-to-common stock basis. The Company recorded a beneficial conversion feature of $1,980,000 based on the fair value of the common stock and the conversion rate as of the date of the offering. This amount was recorded as a deemed distribution during the period of the offering.   8 - WARRANTS   In connection with the private placement of 2,250 shares of the Company's convertible preferred stock on June 22, 2015, we issued to the investors warrants to purchase up to 1,800,000 shares of common stock. The warrants have an exercise price of $1.50 per share and are exercisable for 4 years. We also issued an aggregate of 162,000 warrants that were similar to the warrants issued to investors and are exercisable at $1.50 per share for 4 years, to our placement agent and its designees.   The following is a summary of the status of all of the Companys stock warrants as of September 30, 2016 and changes during the periods ended on that date:   <table cellspacing="0" cellpadding="0" align="center" style="width: 6.5in; font: 11pt Times New Roman, Times, Serif; border-collapse: collapse"> <tr style="vertical-align: top"> <td style="width: 58%; padding-right: 5.4pt; padding-left: 5.4pt"> </td> <td style="width: 16%; border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> Number of Warrants</td> <td style="width: 3%; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td> <td style="width: 23%; border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> Weighted-Average Exercise Price</td></tr> <tr style="vertical-align: top; background-color: #CCFFCC"> <td style="padding-right: 5.4pt; padding-left: 5.4pt">Outstanding at January 1, 2016</td> <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">2,162,000</td> <td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td> <td style="padding-right: 13.25pt; padding-left: 5.4pt; text-align: right">$     1.41</td></tr> <tr style="vertical-align: top"> <td style="padding-right: 5.4pt; padding-left: 8.55pt">Granted</td> <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">-</td> <td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td> <td style="padding-right: 13.25pt; padding-left: 5.4pt; text-align: right">$     0.00</td></tr> <tr style="vertical-align: top; background-color: #CCFFCC"> <td style="padding-right: 5.4pt; padding-left: 8.55pt">Exercised</td> <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">-</td> <td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td> <td style="padding-right: 13.25pt; padding-left: 5.4pt; text-align: right">$     0.00</td></tr> <tr style="vertical-align: top"> <td style="padding-right: 5.4pt; padding-left: 8.55pt">Cancelled</td> <td style="border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">-</td> <td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td> <td style="border-bottom: Black 1pt solid; padding-right: 13.25pt; padding-left: 5.4pt; text-align: right">$     0.00</td></tr> <tr style="vertical-align: top; background-color: #CCFFCC"> <td style="padding-right: 5.4pt; padding-left: 5.4pt">Outstanding at September 30, 2016</td> <td style="border-bottom: Black 1.5pt double; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">2,162,000</td> <td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td> <td style="border-bottom: Black 1.5pt double; padding-right: 13.25pt; padding-left: 5.4pt; text-align: right">$     1.41</td></tr> <tr style="vertical-align: top"> <td style="padding-right: 5.4pt; padding-left: 5.4pt">Warrants exercisable at September 30, 2016</td> <td style="border-bottom: Black 1.5pt double; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">2,162,000</td> <td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td> <td style="border-bottom: Black 1.5pt double; padding-right: 13.25pt; padding-left: 5.4pt; text-align: right">$     1.41</td></tr> </table>     9 - FORM S-1 REGISTRATION STATEMENT   On July 6, 2015, the Company filed a Form S-1 registration statement that relates to the offer and resale of up to 3,762,000 shares of the Companys common stock, par value $0.0001 per share, by the selling stockholders (Selling Stockholders) listed in the Form S-1 registration statement (Selling Stockholders), issuable to such stockholders upon the conversion of shares of the Companys preferred stock or exercise of an aggregate of 1,800,000 warrants which the Company sold to investors in a private placement, or exercise of an aggregate of 162,000 warrants which the Company issued to its placement agent. In that private placement the Company sold an aggregate of 2,250 shares of its Series A convertible preferred stock, par value $0.0001 per share (Preferred Stock) for gross proceeds to the Company of $2,250,000. Each share of the Preferred Stock is convertible into 800 shares of the Companys common stock (Common Stock) which results in an effective conversion price of $1.25 per share. The Preferred Stock has no dividend rights or liquidation preference. If dividends are declared on the Common Stock, the holders of the Preferred Stock shall be entitled to participate in such dividends on an as-converted-to-common stock basis. In addition, in the private placement the Company issued to the investors warrants (Investor Warrants) to purchase up to 1,800,000 shares of Common Stock. The Warrants have an exercise price of $1.50 per share and are exercisable through June 21, 2019. The shares of the Companys common stock issuable on exercise of the Investor Warrants are registered under the Companys Form S-1. H.C. Wainwright & Co., LLC (Placement Agent) acted as the exclusive placement agent for the placement of the Companys Preferred Stock and Investor Warrants. The Placement Agent purchased securities in the offering on the same terms and conditions as the other investors. In addition, the Placement Agent and its designees received an aggregate of 162,000 warrants to purchase the Companys common stock at a price of $1.50 per share through June 21, 2019 (Agent Warrants). The shares underlying the Agent Warrants are registered under the Companys Form S-1. The Company will not receive any proceeds from the sale of shares sold by the Selling Stockholders or from the conversion of Preferred Stock. However, the Company will receive proceeds of $1.50 per share upon the exercise of any Investor Warrants or Agent Warrants. The Companys Form S-1 registration statement became effective on August 10, 2015.   On August 11, 2015, the Selling Stockholders converted an aggregate of 375 convertible preferred stock into 300,000 shares of common stock that were issued by the Company to the Selling Stockholders.   On September 1, 2015, the Placement Agent converted an aggregate of 250 convertible preferred stock into 200,000 shares of common stock that were issued by the Company to the Placement Agent.

<table cellspacing="0" cellpadding="0" align="center" style="width: 6.5in; font: 11pt Times New Roman, Times, Serif; border-collapse: collapse"> <tr style="vertical-align: top"> <td style="width: 58%; padding-right: 5.4pt; padding-left: 5.4pt"> </td> <td style="width: 16%; border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> Number of Warrants</td> <td style="width: 3%; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"> </td> <td style="width: 23%; border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt"> Weighted-Average Exercise Price</td></tr> <tr style="vertical-align: top; background-color: #CCFFCC"> <td style="padding-right: 5.4pt; padding-left: 5.4pt">Outstanding at January 1, 2016</td> <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">2,162,000</td> <td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td> <td style="padding-right: 13.25pt; padding-left: 5.4pt; text-align: right">$     1.41</td></tr> <tr style="vertical-align: top"> <td style="padding-right: 5.4pt; padding-left: 8.55pt">Granted</td> <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">-</td> <td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td> <td style="padding-right: 13.25pt; padding-left: 5.4pt; text-align: right">$     0.00</td></tr> <tr style="vertical-align: top; background-color: #CCFFCC"> <td style="padding-right: 5.4pt; padding-left: 8.55pt">Exercised</td> <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">-</td> <td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td> <td style="padding-right: 13.25pt; padding-left: 5.4pt; text-align: right">$     0.00</td></tr> <tr style="vertical-align: top"> <td style="padding-right: 5.4pt; padding-left: 8.55pt">Cancelled</td> <td style="border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">-</td> <td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td> <td style="border-bottom: Black 1pt solid; padding-right: 13.25pt; padding-left: 5.4pt; text-align: right">$     0.00</td></tr> <tr style="vertical-align: top; background-color: #CCFFCC"> <td style="padding-right: 5.4pt; padding-left: 5.4pt">Outstanding at September 30, 2016</td> <td style="border-bottom: Black 1.5pt double; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">2,162,000</td> <td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td> <td style="border-bottom: Black 1.5pt double; padding-right: 13.25pt; padding-left: 5.4pt; text-align: right">$     1.41</td></tr> <tr style="vertical-align: top"> <td style="padding-right: 5.4pt; padding-left: 5.4pt">Warrants exercisable at September 30, 2016</td> <td style="border-bottom: Black 1.5pt double; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">2,162,000</td> <td style="padding-right: 5.4pt; padding-left: 5.4pt"> </td> <td style="border-bottom: Black 1.5pt double; padding-right: 13.25pt; padding-left: 5.4pt; text-align: right">$     1.41</td></tr> </table>

P15Y P5Y 8060

2 - GOING CONCERN   The Company's financial statements are prepared using generally accepted accounting principles in the United States of America applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has not yet established an ongoing source of revenues sufficient to cover its operating costs and allow it to continue as a going concern. The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it becomes profitable. If the Company is unable to obtain adequate capital, it could be forced to cease operations.   In order to continue as a going concern, the Company will need, among other things, additional capital resources. Management's plan is to obtain such resources for the Company by obtaining capital from management and significant shareholders sufficient to meet its minimal operating expenses and seeking equity and/or debt financing. However, management cannot provide any assurances that the Company will be successful in accomplishing any of its plans.   The ability of the Company to continue as a going concern is dependent upon its ability to successfully accomplish the plans described in the preceding paragraph and eventually secure other sources of financing and attain profitable operations. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Recent Accounting Pronouncements Management has considered all recent accounting pronouncements issued since the last audit of our financial statements. The Companys management believes that these recent pronouncements will not have a material effect on the Companys financial statements.

Cash and Cash Equivalents Cash equivalents comprise of certain highly liquid instruments with a maturity of three months or less when purchased.

Marketable Securities All marketable securities are classified as available-for-sale since these instruments are readily marketable. These securities are carried at fair value, which is based on readily available market information.

10 - SUBSEQUENT EVENTS   On October 17, 2016, we announced a collaboration with StemImmune to develop its stem cell-mediated immunotherapy for the treatment of cancer, such as brain cancer. StemImmune's immunotherapy uses the stealth anti-cancer payload carrying and tumor seeking capacities of a patient's own readily available (adult) stem cells to target cancer. The patient's immune system cannot recognize and react to the "Trojan Horse" stem cells, because they are the patient's own. To date, StemImmune has treated 25 cancer patients with its proprietary technology in a Phase 1 clinical trial that showed that its stem cell-mediated immunotherapy was safe and well-tolerated with no adverse events reported, and demonstrated potential anti-tumor activity which supports further investigation in clinical trials. All patients received treatment through a minimally invasive outpatient procedure.

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Entity Filer Category Entity Public Float Entity Common Stock, Shares Outstanding Entity Preferred Stock, Shares Outstanding Document Fiscal Period Focus Document Fiscal Year Focus Amendment Description Statement of Financial Position [Abstract] ASSETS Current Assets Cash and cash equivalents Marketable Securities Total current assets Prepaid Assets Fixed Assets, net Total assets LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES Accounts payable and other accruals, including related party liabilities of $10,500 as of September 30, 2016 and $149,000 as of December 31, 2015 Total current liabilities Convertible Notes Total liabilities Commitments and contingencies STOCKHOLDERS' EQUITY Convertible Preferred stock Authorized 2,000,000 shares at par value of $0.0001 and with a stated value of $1,000 Issued and outstanding 1,625 shares as of September 30, 2016 and as of December 31, 2015 Common stock, authorized 20,000,000 shares at par value of $ 0.0001 each issued and outstanding 9,198,954 shares as of September 30, 2016 and 7,513,816 shares as of December 31, 2015 Common Stock Issuable Additional paid-in capital Accumulated deficit Total stockholders' deficit Total liabilities and stockholders' deficit Related party liabilities Convertible Preferred stock Convertible Preferred Stock Shares Authorized Convertible Preferred Stock Stated Value Convertible Preferred Stock Par Value Convertible Preferred Stock Issued Convertible Preferred Stock Outstanding Common Stock Common Stock Shares Authorized Common Stock Shares Par Value Common Stock Shares Issued Common Stock Shares Outstanding Income Statement [Abstract] Revenue Operating Expenses Depreciation and Amortization Expense Research & Development General and Administrative Total Operating Expenses Loss from Operations Interest Income (Expense) Gain from Extinguishment of Debt Loss before provisions for income taxes Provision for income taxes Net Loss Loss per common share - basic and fully diluted: Weighted average number of basic and fully diluted common shares outstanding Statement of Cash Flows [Abstract] Cash flows from operations: Loss from continuing operations Adjustment to reconcile net loss to net cash used in operating activities: Depreciation and Amortization Amortization of non-cash expenses Amortization of discount on convertible notes Changes in operating assets and liabilities: Accounts payable and other accruals Net cash used in operations Investment activities: Investment in fixed assets Redemption of marketable securities Net cash used in investment activities Financing activities: Share subscriptions received Net cash provided by financing activities Net (decrease) / increase in cash Cash, beginning of period Cash, end of period Organization, Consolidation and Presentation of Financial Statements [Abstract] 1 - INTERIM FINANCIAL STATEMENTS 2 - GOING CONCERN Accounting Policies [Abstract] 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Notes to Financial Statements 4 - PREPAID ASSETS 5 - FIXED ASSETS Debt Disclosure [Abstract] 6 - CONVERTIBLE NOTES 7 - CONVERTIBLE PREFERRED STOCK 8 - WARRANTS 9 - FORM S-1 REGISTRATION STATEMENT Subsequent Events [Abstract] 10 - SUBSEQUENT EVENTS Significant Accounting Policies Policies Description of Business Accounting Basis Use of Estimates Recent Accounting Pronouncements Cash and Cash Equivalents Marketable Securities Concentration of Credit Risk and Financial Instruments Patent Rights Fair Value of Financial Instruments Earnings (Loss) per Share Revenue Recognition Start-up Cost Research and Development Expenses Income Taxes Warrants Uninsured cash balances Consultant engaged, duration Common stock issued for consultant services, shares Common stock issued for consultant services, value per share Value of shares capitalized as prepaid assets Convertible Note Payable to Lim Development Group Convertible note payable issued to Lim Development Group Interest on convertible note payable to Lim Development Group Conversion of convertible note payable, price per share Term of convertible note payable Warrants Issued Through Consulting Agreement with Capital Communications Group Warrants issued to Capital Communications Group Exercise price of warrants issued to Capital Communications Group Term of warrants issued to Captial Communications Group Value of warrants issued to Capital Communications Group ACL Exclusive License Agreement Shares to be issued for ACL license fee Value of shares to be issued for ACL license fee, per share Capitalized value of shares to be issued for ACL license fee Amortization period of capitalized value Estimated patent life of prototype Convertible note issued Period of convertible note Interest rate of convertible debenture, per annum Debt conversion to common stock rate Prior written notice to prepay note in cash subject to conversion, business days Debt conversion to common stock rate, as percent of market price Days prior to conversion for calculating market price Value of conversion feature on July 15 note Interest expense of aggregate beneficial conversion feature on July 15 note Convertible preferred stock shares issued for cash, amount Convertible preferred stock shares issued for cash, value Net Proceeds from sale of convertible preferred stock Preferred share convertible to amount of common shares Convertible preferred stock convertible to common stock, conversion price per share Beneficial converstion value of convertible preferred shares Statement [Table] Statement [Line Items] WarrantsAxis [Axis] Number of Warrant Shares, instant Number of Warrant Shares, duration Weighted Average Exercise Price, instant Weighted Average Exercise Price, duration Warrants issued with convertible preferred shares Warrants issued to placement agents of convertible preferred shares Exercise price of stock purchase warrants, duration Term of stock purchase warrants after conversion Shares of common stock included in registration statement Convertible preferred shares converted to common shares Preferred shares conversion resulted in issuance of common shares, amount Related Party Transactions Details Narrative Assets, Current Assets Liabilities, Current Liabilities Stockholders' Equity Attributable to Parent Liabilities and Equity Income (Loss) from Continuing Operations before Income Taxes, Domestic Current Income Tax Expense (Benefit) Net Cash Provided by (Used in) Operating Activities Net Cash Provided by (Used in) Investing Activities Net Cash Provided by (Used in) Financing Activities Cash Marketable Securities, Policy [Policy Text Block] Revenue from 4GS EX-101.PRE 11 acxa-20160930_pre.xml XBRL PRESENTATION FILE XML 12 R1.htm IDEA: XBRL DOCUMENT

Document and Entity Information - shares	9 Months Ended
Document and Entity Information - shares	Sep. 30, 2016	Nov. 04, 2016	Dec. 31, 2015
Document And Entity Information
Entity Registrant Name	Accurexa Inc.
Entity Central Index Key	0001562107
Document Type	10-Q
Document Period End Date	Sep. 30, 2016
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Is Entity a Well-known Seasoned Issuer?	No
Is Entity a Voluntary Filer?	Yes
Is Entity's Reporting Status Current?	Yes
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		9,198,954
Entity Preferred Stock, Shares Outstanding	1,625	1,625	1,625
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2016

XML 13 R2.htm IDEA: XBRL DOCUMENT

Balance Sheets (Unaudited) - USD ($)	Sep. 30, 2016	Dec. 31, 2015
Current Assets
Cash and cash equivalents	$ 1,458,126	$ 1,811,871
Marketable Securities	0	199,906
Total current assets	1,458,126	2,011,777
Prepaid Assets	1,478,748	2,067,694
Fixed Assets, net	134,113	166,119
Total assets	3,070,987	4,245,590
CURRENT LIABILITIES
Accounts payable and other accruals, including related party liabilities of $10,500 as of September 30, 2016 and $149,000 as of December 31, 2015	36,084	180,782
Total current liabilities	36,084	180,782
Convertible Notes	472,623	383,980
Total liabilities	508,707	564,762
STOCKHOLDERS' EQUITY
Convertible Preferred stock Authorized 2,000,000 shares at par value of $0.0001 and with a stated value of $1,000 Issued and outstanding 1,625 shares as of September 30, 2016 and as of December 31, 2015	0	0
Common stock, authorized 20,000,000 shares at par value of $ 0.0001 each issued and outstanding 9,198,954 shares as of September 30, 2016 and 7,513,816 shares as of December 31, 2015	920	751
Common Stock Issuable	0	1,132,000
Additional paid-in capital	14,102,486	12,639,978
Accumulated deficit	(11,541,126)	(10,091,902)
Total stockholders' deficit	2,562,279	3,680,828
Total liabilities and stockholders' deficit	$ 3,070,987	$ 4,245,590

XML 14 R3.htm IDEA: XBRL DOCUMENT

Balance Sheets (Parenthetical) - USD ($)	Sep. 30, 2016	Dec. 31, 2015
Statement of Financial Position [Abstract]
Related party liabilities	$ 10,500	$ 149,000
Convertible Preferred stock
Convertible Preferred Stock Shares Authorized	2,000,000	2,000,000
Convertible Preferred Stock Stated Value	$ 1,000	$ 1,000
Convertible Preferred Stock Par Value	$ 0.0001	$ .0001
Convertible Preferred Stock Issued	1,625	1,625
Convertible Preferred Stock Outstanding	1,625	1,625
Common Stock
Common Stock Shares Authorized	20,000,000	20,000,000
Common Stock Shares Par Value	$ 0.0001	$ 0.0001
Common Stock Shares Issued	9,198,954	7,513,816
Common Stock Shares Outstanding	9,198,954	7,513,816

XML 15 R4.htm IDEA: XBRL DOCUMENT

Statements of Operations (Unaudited) - USD ($)	3 Months Ended		9 Months Ended
Statements of Operations (Unaudited) - USD ($)	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Income Statement [Abstract]
Revenue	$ 0	$ 0	$ 0	$ 0
Operating Expenses
Depreciation and Amortization Expense	10,668	10,668	32,005	31,608
Research & Development	418,631	196,842	835,651	431,095
General and Administrative	171,177	267,233	471,910	870,487
Total Operating Expenses	600,477	474,744	1,339,567	1,333,191
Loss from Operations	(600,477)	(474,744)	(1,339,567)	(1,333,191)
Interest Income (Expense)	(49,683)	(18,898)	(109,658)	(51,143)
Gain from Extinguishment of Debt	0	144,505	0	144,505
Loss before provisions for income taxes	(650,160)	(349,137)	(1,449,225)	(1,239,829)
Provision for income taxes	0	0	0	0
Net Loss	$ (650,160)	$ (349,137)	$ (1,449,225)	$ (1,239,829)
Loss per common share - basic and fully diluted:	$ (0.07)	$ (0.05)	$ (0.17)	$ (0.21)
Weighted average number of basic and fully diluted common shares outstanding	9,097,424	6,423,007	8,644,927	5,979,117

XML 16 R5.htm IDEA: XBRL DOCUMENT

Statements of Cash Flows (Unaudited) - USD ($)	9 Months Ended
Statements of Cash Flows (Unaudited) - USD ($)	Sep. 30, 2016	Sep. 30, 2015
Cash flows from operations:
Loss from continuing operations	$ (1,449,225)	$ (1,239,829)
Adjustment to reconcile net loss to net cash used in operating activities:
Depreciation and Amortization	32,005	31,608
Amortization of non-cash expenses	919,491	904,245
Amortization of discount on convertible notes	88,643	18,616
Changes in operating assets and liabilities:
Accounts payable and other accruals	(144,698)	(113,942)
Net cash used in operations	(553,783)	(399,302)
Investment activities:
Investment in fixed assets	0	(51,075)
Redemption of marketable securities	200,038	(200,146)
Net cash used in investment activities	200,038	(251,221)
Financing activities:
Share subscriptions received	0	1,993,500
Net cash provided by financing activities	0	1,993,500
Net (decrease) / increase in cash	(353,745)	1,342,977
Cash, beginning of period	1,811,871	555,506
Cash, end of period	$ 1,458,126	$ 1,898,484

XML 17 R6.htm IDEA: XBRL DOCUMENT

1 - INTERIM FINANCIAL STATEMENTS

9 Months Ended

Sep. 30, 2016

Organization, Consolidation and Presentation of Financial Statements [Abstract]

1 - INTERIM FINANCIAL STATEMENTS

1 - INTERIM FINANCIAL STATEMENTS

XML 18 R7.htm IDEA: XBRL DOCUMENT

2 - GOING CONCERN

9 Months Ended

Sep. 30, 2016

Organization, Consolidation and Presentation of Financial Statements [Abstract]

2 - GOING CONCERN

2 - GOING CONCERN

XML 19 R8.htm IDEA: XBRL DOCUMENT

3 - SIGNIFICANT ACCOUNTING POLICIES

9 Months Ended

Sep. 30, 2016

Accounting Policies [Abstract]

3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

3 – SIGNIFICANT ACCOUNTING POLICIES

Use of Estimates

Recent Accounting Pronouncements

Cash and Cash Equivalents

Cash equivalents comprise of certain highly liquid instruments with a maturity of three months or less when purchased.

Marketable Securities

XML 20 R9.htm IDEA: XBRL DOCUMENT

4 - PREPAID ASSETS

9 Months Ended

Sep. 30, 2016

Notes to Financial Statements

4 - PREPAID ASSETS

4 – PREPAID ASSETS

XML 21 R10.htm IDEA: XBRL DOCUMENT

5 - FIXED ASSETS

9 Months Ended

Sep. 30, 2016

Notes to Financial Statements

5 - FIXED ASSETS

5 – FIXED ASSETS

XML 22 R11.htm IDEA: XBRL DOCUMENT

6 - CONVERTIBLE NOTES

9 Months Ended

Sep. 30, 2016

Debt Disclosure [Abstract]

6 - CONVERTIBLE NOTES

6 - CONVERTIBLE NOTES

XML 23 R12.htm IDEA: XBRL DOCUMENT

7 - CONVERTIBLE PREFERRED STOCK

9 Months Ended

Sep. 30, 2016

Notes to Financial Statements

7 - CONVERTIBLE PREFERRED STOCK

7 – CONVERTIBLE PREFERRED STOCK

On June 22, 2015, the company closed a private placement of 2,250 shares of the Company's convertible preferred stock for gross proceeds to the Company of $2,250,000 and net proceeds of $1,993,500. The convertible preferred stock is convertible into shares of common stock of the Company at a conversion price of $1.25 per share. The Preferred Stock has no dividend rights or liquidation preference. If dividends are declared on the Common Stock, the holders of the Preferred Stock shall be entitled to participate in such dividends on an as-converted-to-common stock basis. The Company recorded a beneficial conversion feature of $1,980,000 based on the fair value of the common stock and the conversion rate as of the date of the offering. This amount was recorded as a deemed distribution during the period of the offering.

XML 24 R13.htm IDEA: XBRL DOCUMENT

8 - WARRANTS

9 Months Ended

Sep. 30, 2016

Notes to Financial Statements

8 - WARRANTS

8 - WARRANTS

The following is a summary of the status of all of the Company’s stock warrants as of September 30, 2016 and changes during the periods ended on that date:

	Number of Warrants	Weighted-Average Exercise Price
Outstanding at January 1, 2016	2,162,000	$ 1.41
Granted	-	$ 0.00
Exercised	-	$ 0.00
Cancelled	-	$ 0.00
Outstanding at September 30, 2016	2,162,000	$ 1.41
Warrants exercisable at September 30, 2016	2,162,000	$ 1.41

XML 25 R14.htm IDEA: XBRL DOCUMENT

9 - FORM S-1 REGISTRATION STATEMENT

9 Months Ended

Sep. 30, 2016

Notes to Financial Statements

9 - FORM S-1 REGISTRATION STATEMENT

9 - FORM S-1 REGISTRATION STATEMENT

On July 6, 2015, the Company filed a Form S-1 registration statement that relates to the offer and resale of up to 3,762,000 shares of the Company’s common stock, par value $0.0001 per share, by the selling stockholders (“Selling Stockholders”) listed in the Form S-1 registration statement (“Selling Stockholders”), issuable to such stockholders upon the conversion of shares of the Company’s preferred stock or exercise of an aggregate of 1,800,000 warrants which the Company sold to investors in a private placement, or exercise of an aggregate of 162,000 warrants which the Company issued to its placement agent. In that private placement the Company sold an aggregate of 2,250 shares of its Series A convertible preferred stock, par value $0.0001 per share (“Preferred Stock”) for gross proceeds to the Company of $2,250,000. Each share of the Preferred Stock is convertible into 800 shares of the Company’s common stock (“Common Stock”) which results in an effective conversion price of $1.25 per share. The Preferred Stock has no dividend rights or liquidation preference. If dividends are declared on the Common Stock, the holders of the Preferred Stock shall be entitled to participate in such dividends on an as-converted-to-common stock basis. In addition, in the private placement the Company issued to the investors warrants (“Investor Warrants”) to purchase up to 1,800,000 shares of Common Stock. The Warrants have an exercise price of $1.50 per share and are exercisable through June 21, 2019. The shares of the Company’s common stock issuable on exercise of the Investor Warrants are registered under the Company’s Form S-1. H.C. Wainwright & Co., LLC (“Placement Agent”) acted as the exclusive placement agent for the placement of the Company’s Preferred Stock and Investor Warrants. The Placement Agent purchased securities in the offering on the same terms and conditions as the other investors. In addition, the Placement Agent and its designees received an aggregate of 162,000 warrants to purchase the Company’s common stock at a price of $1.50 per share through June 21, 2019 (“Agent Warrants”). The shares underlying the Agent Warrants are registered under the Company’s Form S-1. The Company will not receive any proceeds from the sale of shares sold by the Selling Stockholders or from the conversion of Preferred Stock. However, the Company will receive proceeds of $1.50 per share upon the exercise of any Investor Warrants or Agent Warrants. The Company’s Form S-1 registration statement became effective on August 10, 2015.

On August 11, 2015, the Selling Stockholders converted an aggregate of 375 convertible preferred stock into 300,000 shares of common stock that were issued by the Company to the Selling Stockholders.

On September 1, 2015, the Placement Agent converted an aggregate of 250 convertible preferred stock into 200,000 shares of common stock that were issued by the Company to the Placement Agent.

XML 26 R15.htm IDEA: XBRL DOCUMENT

10 - SUBSEQUENT EVENTS

9 Months Ended

Sep. 30, 2016

Subsequent Events [Abstract]

10 - SUBSEQUENT EVENTS

10 - SUBSEQUENT EVENTS

XML 27 R16.htm IDEA: XBRL DOCUMENT

3 - SIGNIFICANT ACCOUNTING POLICIES (Policies)	9 Months Ended
3 - SIGNIFICANT ACCOUNTING POLICIES (Policies)	Sep. 30, 2016
Significant Accounting Policies Policies
Use of Estimates	Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Recent Accounting Pronouncements	Recent Accounting Pronouncements Management has considered all recent accounting pronouncements issued since the last audit of our financial statements. The Company’s management believes that these recent pronouncements will not have a material effect on the Company’s financial statements.
Cash and Cash Equivalents	Cash and Cash Equivalents Cash equivalents comprise of certain highly liquid instruments with a maturity of three months or less when purchased.
Marketable Securities	Marketable Securities All marketable securities are classified as available-for-sale since these instruments are readily marketable. These securities are carried at fair value, which is based on readily available market information.

- Definition

Disclosure of accounting policy for cash and cash equivalents, including the policy for determining which items are treated as cash equivalents. Other information that may be disclosed includes (1) the nature of any restrictions on the entity's use of its cash and cash equivalents, (2) whether the entity's cash and cash equivalents are insured or expose the entity to credit risk, (3) the classification of any negative balance accounts (overdrafts), and (4) the carrying basis of cash equivalents (for example, at cost) and whether the carrying amount of cash equivalents approximates fair value.

+ References + Details

- Definition

Disclosure of accounting policy for investments in debt and equity securities that have readily determinable fair values (marketable securities). At a minimum, the disclosure might address accounting policies for investments classified as trading, available for sale, or held to maturity and may include how the entity determines whether impairments of available for sale or held to maturity investments are other than temporary, how the fair values of the entity's securities are determined, and the entity's accounting treatment for transfers between investment categories.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
-SubTopic 210
-Section S99
-Paragraph 1
-Subparagraph (SX 210.9-03(6))
-URI http://asc.fasb.org/extlink&oid=6876686&loc=d3e534808-122878

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-SubTopic 10
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Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Glossary Readily Determinable Fair Value
-URI http://asc.fasb.org/extlink&oid=65888395

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 9: http://www.xbrl.org/2003/role/presentationRef
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-Paragraph 1
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-URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682

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-Name Accounting Standards Codification
-Topic 942
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-Section S99
-Paragraph 1
-Subparagraph (SX 210.9-03(5))
-URI http://asc.fasb.org/extlink&oid=6876686&loc=d3e534808-122878

+ Details

XML 28 R17.htm IDEA: XBRL DOCUMENT

8 - WARRANTS (Tables)

9 Months Ended

Sep. 30, 2016

Notes to Financial Statements

Warrants

	Number of Warrants	Weighted-Average Exercise Price
Outstanding at January 1, 2016	2,162,000	$ 1.41
Granted	-	$ 0.00
Exercised	-	$ 0.00
Cancelled	-	$ 0.00
Outstanding at September 30, 2016	2,162,000	$ 1.41
Warrants exercisable at September 30, 2016	2,162,000	$ 1.41

- Definition

Tabular disclosure of warrants or rights issued. Warrants and rights outstanding are derivative securities that give the holder the right to purchase securities (usually equity) from the issuer at a specific price within a certain time frame. Warrants are often included in a new debt issue to entice investors by a higher return potential. The main difference between warrants and call options is that warrants are issued and guaranteed by the company, whereas options are exchange instruments and are not issued by the company. Also, the lifetime of a warrant is often measured in years, while the lifetime of a typical option is measured in months. Disclose the title of issue of securities called for by warrants and rights outstanding, the aggregate amount of securities called for by warrants and rights outstanding, the date from which the warrants or rights are exercisable, and the price at which the warrant or right is exercisable.

+ References + Details

XML 29 R18.htm IDEA: XBRL DOCUMENT

4 - PREPAID ASSETS (Details Narrative) - USD ($)	Aug. 11, 2015	Feb. 18, 2015	Jan. 12, 2015	Sep. 30, 2016	Dec. 31, 2015
Notes to Financial Statements
Value of shares capitalized as prepaid assets				$ 1,478,748	$ 2,067,694
Convertible Note Payable to Lim Development Group
Convertible note payable issued to Lim Development Group			$ 200,000
Interest on convertible note payable to Lim Development Group			5.00%
Conversion of convertible note payable, price per share			$ 0.20
Term of convertible note payable			24 months
Warrants Issued Through Consulting Agreement with Capital Communications Group
Warrants issued to Capital Communications Group		200,000
Exercise price of warrants issued to Capital Communications Group		$ 0.50
Term of warrants issued to Captial Communications Group		4 years
Value of warrants issued to Capital Communications Group		$ 527,500
ACL Exclusive License Agreement
Shares to be issued for ACL license fee	1,000,000
Value of shares to be issued for ACL license fee, per share	$ 1.13
Capitalized value of shares to be issued for ACL license fee	$ 1,130,000
Amortization period of capitalized value	15 years

XML 30 R19.htm IDEA: XBRL DOCUMENT

5 - FIXED ASSETS (Details Narrative) - USD ($)	9 Months Ended
5 - FIXED ASSETS (Details Narrative) - USD ($)	Sep. 30, 2016	Dec. 31, 2015
Notes to Financial Statements
Estimated patent life of prototype	5 years
Fixed Assets, net	$ 134,113	$ 166,119

XML 31 R20.htm IDEA: XBRL DOCUMENT

6 - CONVERTIBLE NOTES (Details Narrative) - USD ($)	Jul. 15, 2014	Sep. 30, 2016	Jan. 12, 2015	Jul. 25, 2013
Debt Disclosure [Abstract]
Convertible note issued	$ 20,000		$ 200,000	$ 350,000
Period of convertible note	48 months
Interest rate of convertible debenture, per annum	5.00%		5.00%	10.00%
Debt conversion to common stock rate			$ .20	$ .50
Prior written notice to prepay note in cash subject to conversion, business days	15 days
Debt conversion to common stock rate, as percent of market price	50.00%
Days prior to conversion for calculating market price	10 days
Value of conversion feature on July 15 note	$ 20,000
Interest expense of aggregate beneficial conversion feature on July 15 note		$ 8,060

XML 32 R21.htm IDEA: XBRL DOCUMENT

7 - CONVERTIBLE PREFERRED STOCK (Details Narrative)	Jun. 22, 2015 USD ($) $ / shares shares
Notes to Financial Statements
Convertible preferred stock shares issued for cash, amount \| shares	2,250
Convertible preferred stock shares issued for cash, value	$ 2,250,000
Net Proceeds from sale of convertible preferred stock	$ 1,993,500
Convertible preferred stock convertible to common stock, conversion price per share \| $ / shares	$ 1.25
Beneficial converstion value of convertible preferred shares	$ 1,980,000

XML 33 R22.htm IDEA: XBRL DOCUMENT

8 - WARRANTS (Details) - $ / shares	9 Months Ended
8 - WARRANTS (Details) - $ / shares	Sep. 30, 2016	Jan. 01, 2016
Outstanding
Number of Warrant Shares, instant	2,162,000	2,162,000
Weighted Average Exercise Price, instant	$ 1.41	$ 1.41
Granted
Number of Warrant Shares, duration	0
Weighted Average Exercise Price, duration	$ 0
Exercised
Number of Warrant Shares, duration	0
Weighted Average Exercise Price, duration	$ 0
Cancelled
Number of Warrant Shares, duration	0
Weighted Average Exercise Price, duration	$ 0
Exercisable
Number of Warrant Shares, instant	2,162,000
Weighted Average Exercise Price, instant	$ 1.41

XML 34 R23.htm IDEA: XBRL DOCUMENT

8 - WARRANTS (Details Narrative)	Jun. 22, 2015 $ / shares shares
Notes to Financial Statements
Warrants issued with convertible preferred shares	1,800,000
Warrants issued to placement agents of convertible preferred shares	162,000
Exercise price of stock purchase warrants, duration \| $ / shares	$ 1.50
Term of stock purchase warrants after conversion	4 years

XML 35 R24.htm IDEA: XBRL DOCUMENT

9 - FORM S-1 REGISTRATION STATEMENT (Details Narrative) - shares	Sep. 01, 2015	Aug. 11, 2015	Jul. 06, 2015
Notes to Financial Statements
Shares of common stock included in registration statement			3,762,000
Convertible preferred shares converted to common shares	250	375
Preferred shares conversion resulted in issuance of common shares, amount	200,000	300,000