Quarterly report pursuant to Section 13 or 15(d)

NON-CONTROLLING INTEREST

v3.20.1
NON-CONTROLLING INTEREST
3 Months Ended
Mar. 31, 2020
Noncontrolling Interest [Abstract]  
Noncontrolling Interest Disclosure [Text Block]

NOTE 10 – NON-CONTROLLING INTEREST


On November 7, 2018, the Company formed ViralClear Pharmaceuticals, Inc., a Delaware Corporation, formerly known as NeuroClear Technologies, Inc. for the purpose to pursue additional applications of the PURE EP™ signal processing technology outside of electrophysiology and subsequently in 2020, which was repurposed to bring a broad-spectrum anti-viral agent against the COVID-19 virus to market (see below). 


In 2019, ViralClear sold 896,690 shares of its common stock for net proceeds of $5,011,310 to fund initial operations. At December 31, 2019, the Company had a majority interest in ViralClear of 87.8%.


On March 24, 2020, ViralClear entered into an Asset Purchase Agreement with Trek Therapeutics, PBC.  Pursuant to the Asset Purchase Agreement, Trek sold to ViralClear all right, title and interest of Trek and its affiliates to certain assets. As consideration for the Purchased Assets, ViralClear agreed to pay Trek in upfront and milestone payments a combination of cash, shares of ViralClear’s common stock, which common stock may equal up to 10% of the Company’s outstanding equity, and sublicense fees in the event ViralClear sublicenses the Purchased Assets. On March 30, 2020, pursuant to the Asset Purchase Agreement, ViralClear paid an upfront payment $350,000 and issued 634,910 shares of ViralClear’s common stock valued at $3,174,550 to Trek. As of March 31, 2020, the Company had a majority interest in ViralClear of 80.9%.  


A reconciliation of the ViralClear Pharmaceuticals, Inc. non-controlling loss attributable to the Company:


Net loss attributable to the non-controlling interest for the three months ended March 31, 2020:


Net loss

  $ (7,621,328

)

Average Non-controlling interest percentage of profit/losses

    18.73

%

Net loss attributable to the non-controlling interest

  $ (1,427,813

)


ViralClear was a wholly owned subsidiary of the Company until August 2019.


The following table summarizes the changes in non-controlling interest for the three months ended March 31, 2020:


Balance, January 1, 2020

  $ 514,828  

Allocation of equity to non-controlling interest due to equity-based compensation issued

    1,520,134  

Net loss attributable to non-controlling interest

    (1,427,813

)

Balance, March 31, 2020

  $ 607,149