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| AGNM.OB > SEC Filings for AGNM.OB > Form 10KSB/A on 9-Oct-2008 | All Recent SEC Filings |
9-Oct-2008
Annual Report
The following is a discussion and analysis of our plan of operation for the next year ended December 31, 2008 and the factors that could affect our future financial condition and plan of operation.
This discussion and analysis should be read in conjunction with our financial statements and the notes thereto included elsewhere in this annual report. Our financial statements are prepared in accordance with United States generally accepted accounting principles. All references to dollar amounts in this section are in United States dollars unless expressly stated otherwise. Please see our "Note on Forward Looking Statements" and "Risk Factors" for a list of our risk factors.
We are engaged in the business of the development of BioLED Technology, combining microfluidics and polymer Light Emitting Diodes (pLED) for use in future Point-of-Care diagnostic devices. On May 23, 2007, we entered into an amended Development Agreement with Molecular Vision Limited, a research company registered in London, England. Molecular Vision Limited, has developed, within their fields of research at Imperial College in London, UK, a technology platform combining microfluidics with an optical detection system based on polymer Light Emitting Diodes (commonly referred to as pLED) to deliver potentially affordable, intelligent and readily portable Point-Of-Care (POC) medical diagnostic devices. The technology platform combining microfluidics and pLED is known as "BioLED Technology.". Under the amended Development Agreement with Molecular Vision Limited, we acquired the exclusive rights to develop and commercialize the existing intellectual properties related to the BioLED Technology and have first refusal rights to develop any additional applications derived from Molecular Vision's pipeline. As consideration for the rights we acquired in the agreement, we agreed to pay a total £2,325,000 and grant 2,000,000 options at an exercise price of $0.50 to Molecular Vision.
Over the next twelve months we will continue to work with Molecular Vision Limited to develop the prototype Point-of-Care testing device for diabetes management and Cardiovascular testing. Presently we are working with Molecular Vision and Pearson Matthews and expect by the end of 2008 we will fabricate our final prototype Point-of-Care device which will be used for the detection of albumin and creatinine in urine (in order to perform multiple testing on the device), as well as the detection of myoglobin (cardiac marker) first in solution and then in whole blood. When we are ready to begin regulatory activities, we may begin the process by determining exactly what we need to do and who we need to contact, for submitting all relevant files to the Food and Drug Administration (FDA) for approval.
We have not generated any revenues and our operating activities have resulted in a loss of $5,056,117 for the year ended December 31, 2007. This negative cash flow is attributable to our operation expenses, including but not limited to, research and development expense and the payment of our audit fees and legal fees. We anticipate that our operating expenses will increase as we intend to conduct detailed development of our first prototype Point-of-Care diagnostic device and work towards its completion. We estimate our expenses in the next twelve months will be approximately $2,850,000, generally falling in two major categories: $2,000,000 in research and development costs and $850,000 in general and administrative expenses.
Research and Development Costs
For the next twelve months, we estimate that our research and development costs will be approximately $2,000,000. We will make payments to Molecular Vision Limited as required under the Development Agreement for Molecular Vision Limited to carry out the research and development projects we have outlined for the next twelve months.
General and Administrative Expenses
For the next twelve months, we estimate that our general and administrative expenses will be approximately $850,000. These expenses will include approximately $450,000 on consulting, stock-based compensation and investor relations, approximately $200,000 on office supplies, office rent, travel and accommodations and $200,000 on professional fees, which consist primarily of accounting, auditing fees for the year-end audit and legal fees for securities advice, directors liability insurance and cost of fundraising.
We do not expect to generate any revenues in the next twelve months. Our future products will likely not be ready for sale for at least one year, if at all.
Results of Operations
We have earned no revenue since our inception. We are still in the development stage and do not anticipate earning any revenues until such time as we can establish an alliance with targeted companies to market or distribute the results of our research projects.
Financial Condition and Liquidity
We had cash on hand of $343,695 as at December 31, 2007, compared with $4,552 as at December 31, 2006. We had a working capital deficit of $1,248,195 at December 31, 2007, compared to a working capital deficit of $185,025 as at December 31, 2006.
Our present cash reserves of $343,695 are not sufficient to meet our cash requirements for the next twelve months. We will have to raise additional funds from the private placement of our securities to meet our budgeted operating expenses of $2,850,000 for the next twelve months.
If we are successful on completing an equity financing, existing shareholders will experience a dilution of their interest in our company. In the event we are not successful in obtaining such financing when necessary, we may not be able to proceed with implementation of all our proposed projects in our business plan.
Off-Balance Sheet Arrangements
We have no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to stockholders.
Critical Accounting Policies and Estimates
The preparation of financial statements in conformity with United States generally accepted accounting principles requires our management to make estimates and assumptions that affect the reported amount 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. Our management routinely makes judgments and estimates about the effects of matters that are inherently uncertain.
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