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Document and Entity Information
9 Months Ended
Mar. 31, 2015
Document and Entity Information [Abstract]
Entity Registrant Name DelMar Pharmaceuticals, Inc.
Entity Central Index Key 0001498382
Current Fiscal Year End Date --06-30
Trading Symbol dmpi
Amendment Flag false
Document Type 10-Q
Entity Current Reporting Status Yes
Document Period End Date Mar 31, 2015
Entity Voluntary Filers No
Entity Filer Category Smaller Reporting Company
Document Fiscal Year Focus 2015
Document Fiscal Period Focus Q3
Entity Common Stock, Shares Outstanding 0
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Consolidated Condensed Interim Balance Sheets (Unaudited) (USD $)
Mar. 31, 2015
Jun. 30, 2014
Current assets
Cash and cash equivalents $ 3,006,598 $ 4,759,711
Taxes and other receivables 49,044 9,572
Prepaid expenses 357,639 234,627
Assets, Current 3,413,281 5,003,910
Current liabilities
Accounts payable and accrued liabilities 486,175 244,906
Related party payables 43,503 54,960
Liabilities, Current 529,678 299,866
Loan payable to Valent    276,439
Stock option liability 179,445 217,759
Derivative liability 1,487,137 3,329,367
Liabilities 2,196,260 4,123,431
Stockholders' Equity
Preferred stock Authorized 5,000,000 shares, $0.001 par value Issued and outstanding 278,530 Series A shares at March 31, 2015 (June 30, 2014 - none) 278,530   
1 special voting share at March 31, 2015 (June 30, 2014 - 1)      
Common stock Authorized 200,000,000 shares, $0.001 par value Issued and outstanding 39,455,931 at March 31, 2015 (June 30, 2014 - 35,992,343) 39,456 35,992
Additional paid-in capital 17,455,279 13,286,278
Warrants 6,138,426 6,200,445
Accumulated deficit (22,715,848) (18,663,414)
Accumulated other comprehensive income 21,178 21,178
Stockholders' equity, total 1,217,021 880,479
Liabilities and Equity $ 3,413,281 $ 5,003,910
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Consolidated Condensed Interim Balance Sheets (Unaudited) (Parenthetical) (USD $)
Mar. 31, 2015
Jun. 30, 2014
Preferred stock, Par value $ 0.001 $ 0.001
Preferred stock, Shares authorized 5,000,000 5,000,000
Preferred stock special voting shares issued 1 1
Common stock, Par value $ 0.001 $ 0.001
Common stock, Shares authorized 200,000,000 200,000,000
Common stock, Shares issued 39,455,931 35,992,343
Common stock, Shares outstanding 39,455,931 35,992,343
Series A Preferred Stock
Preferred stock, Shares outstanding 278,530   
Preferred Stock, Shares issued 278,530 278,530
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Consolidated Condensed Interim Statement of Loss and Comprehensive Loss (Unaudited) (USD $)
3 Months Ended 9 Months Ended
Mar. 31, 2015
Mar. 31, 2014
Mar. 31, 2015
Mar. 31, 2014
Expenses
Research and development $ 641,839 $ 618,869 $ 1,925,635 $ 1,745,164
General and administrative 500,753 966,923 1,601,982 2,344,473
Operating Expenses 1,142,592 1,585,792 3,527,617 4,089,637
Other loss (income)
Change in fair value of derivative liability 343,569 1,599,349 276,963 (6,867,477)
Change in fair value of derivative liability due to change in warrant terms       (23,658)   
Loss on exchange of warrants 156,219    249,062   
Foreign exchange loss 6,826 11,947 16,512 43,910
Interest expense    2,015 2,091 6,088
Interest income (70) (496) (331) (1,807)
Other (income) loss 506,544 1,612,815 520,639 (6,819,286)
Net and comprehensive loss (income) for the period $ 1,649,136 $ 3,198,607 $ 4,048,256 $ (2,729,649)
Basic loss (income) per share $ 0.04 $ 0.1 $ 0.11 $ (0.09)
Diluted loss (income) per share $ 0.04 $ 0.1 $ 0.11 $ 0
Basic weighted average number of shares 38,976,827 31,659,791 37,732,995 31,536,466
Diluted weighted average number of shares 38,976,827 31,659,791 37,732,995 43,238,472
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Consolidated Condensed Interim Statement of Cash Flows (Unaudited) (USD $)
9 Months Ended
Mar. 31, 2015
Mar. 31, 2014
Cash flows from operating activities
(Loss) income for the period $ (4,048,256) $ 2,729,649
Items not affecting cash
Accrued interest 2,091 6,088
Change in fair value of derivative liability 276,963 (6,867,477)
Change in fair value of derivative liability due to change in warrant terms (23,658)   
Loss on exchange of warrants 249,062   
Warrants issued for services    124,020
Share-based compensation 323,358 1,246,353
Net income (loss) after adjustments of non-cash items (3,220,440) (2,761,367)
Changes in non-cash working capital
Taxes and other receivables (39,472) 6,475
Prepaid expenses (14,375) (48,322)
Accounts payable and accrued liabilities 241,269 (26,814)
Related party payables (11,457) (200,664)
Total changes in non-cash working capital 175,965 (269,325)
Net cash flows from operating activities (3,044,475) (3,030,692)
Cash flows from financing activities
Net proceeds from the exercise of warrants 1,404,177 221,850
Deferred costs (108,637)   
Series A preferred stock dividend (4,178)   
Net cash flows from financing activities 1,291,362 221,850
Decrease in cash and cash equivalents (1,753,113) (2,808,842)
Cash and cash equivalents - beginning of period 4,759,711 6,282,992
Cash and cash equivalents - end of period 3,006,598 3,474,150
Supplementary information
Issuance of preferred shares for the settlement of the loan payable to Valent (note 3) 278,530   
Reclassification of derivative liability to equity upon the exercise of Investor Warrants (note 5) 391,422   
Reclassification of derivative liability to equity upon the exchange of Investor Warrants (note 5) 728,835   
Reclassification of derivative liability to equity upon the amendment of Dividend Warrants (note 5) 975,278   
Reclassification of stock option liability upon the forfeiture of stock options (note 6) $ 38,038   
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Going Concern and Nature of Operations
9 Months Ended
Mar. 31, 2015
Going Concern and Nature of Operations [Abstract]
Going concern and nature of operations
1 Going concern and nature of operations

Going concern

These financial statements have been prepared on a going concern basis which assumes that the Company will continue its operations for the foreseeable future and contemplates the realization of assets and the settlement of liabilities in the normal course of business.

For the nine months ended March 31, 2015, the Company reported a loss of $4,048,256, negative cash flow from operations of $3,044,475 (2014 - $3,030,692) and an accumulated deficit of $22,715,848 at that date. As at March 31, 2015, the Company has cash and cash equivalents on hand of $3,006,598 and a working capital balance of $2,883,603. The Company does not have the prospect of achieving revenues in the near future and the Company will require additional funding to maintain its research and development projects and for general operations. These circumstances indicate the existence of a material uncertainty that may cast substantial doubt as to the ability of the Company to meet its obligations as they come due.

Consequently, management is pursuing various financing alternatives to fund the Company’s operations so it can continue as a going concern. In addition, the Company has not begun to generate revenues from its product candidate. Management plans to secure the necessary financing through the issue of new equity and/or the entering into of strategic partnership arrangements. Nevertheless, there is no assurance that these initiatives will be successful.

These financial statements do not give effect to any adjustments to the amounts and classification of assets and liabilities that may be necessary should the Company be unable to continue as a going concern. Such adjustments could be material.


Nature of operations
 

DelMar Pharmaceuticals, Inc. (the “Company”) is a Nevada corporation formed on June 24, 2009 under the name Berry Only, Inc. Prior to a reverse acquisition undertaken on January 25, 2013 Berry did not have any significant assets or operations. The Company is the parent company of Del Mar Pharmaceuticals (BC) Ltd. (“DelMar (BC)”), a British Columbia, Canada corporation incorporated on April 6, 2010. The Company is also the parent company of 0959454 B.C. Ltd., a British Columbia corporation (“Callco”), and 0959456 B.C. Ltd., a British Columbia corporation (“Exchangeco”). Callco and Exchangeco were formed to facilitate the reverse acquisition.

 

Pursuant to the reverse acquisition, the Company acquired (either directly or indirectly (through Exchangeco)) all of the issued and outstanding shares of DelMar (BC) on January 25, 2013. As a result of the shareholders of DelMar (BC) owning a controlling interest in the Company subsequent to the reverse acquisition, for accounting purposes the transaction is a capital transaction with DelMar (BC) being the accounting acquirer even though the legal acquirer is Berry. Therefore, the historic financial statements of DelMar (BC) are presented as the comparative balances for the periods prior to the reverse acquisition.

References to the Company, “we”, “us”, and “our” refer to the Company and its wholly-owned subsidiaries, DelMar (BC), Callco and Exchangeco. References to Berry relate to the Company prior to the reverse acquisition.

The Company is a clinical stage drug development company with a focus on the treatment of cancer.   We are conducting clinical trials in the United States with our product candidate, VAL-083, as a potential new treatment for glioblastoma multiforme (“GBM”), the most common and aggressive form of brain cancer.  In order to accelerate our development timelines and reduce technical risk, we leverage existing clinical and commercial data from a wide range of sources.  We have also acquired certain exclusive commercial rights to VAL-083 in China where it is approved as a chemotherapy for the treatment of chronic myelogenous leukemia (“CML”) and lung cancer.  In order to accelerate our development timeline and reduce technical risk, we leverage existing clinical and commercial data from a wide range of sources. We plan to seek marketing partnerships in China in order to generate future royalty revenue.

  

The address of the Company’s administrative offices is Suite 720 - 999 West Broadway, Vancouver, British Columbia, V5Z 1K5 with clinical operations located at 3485 Edison Way, Suite R, Menlo Park, California, 94025.

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Significant Accounting Policies
9 Months Ended
Mar. 31, 2015
Significant Accounting Policies [Abstract]
Significant accounting policies
2Significant accounting policies

Basis of presentation

The consolidated condensed interim financial statements of the Company have been prepared in accordance with United States Generally Accepted Accounting Principles (“U.S. GAAP”) and are presented in United States dollars. The Company’s functional currency is the United States dollar.

In the quarter ended March 31, 2013, the Company’s functional currency changed from Canadian dollars to United States dollars as a result of various objective factors. Therefore translation of goods and services in a foreign currency are re-measured to the functional currency of the Company with gains and losses on re-measurement recorded in the consolidated condensed interim statement of loss. Any gains and losses that were previously recorded in accumulated other comprehensive income are unchanged from the date of the change of functional currency which was January 1, 2013

The accompanying consolidated condensed interim financial statements include the accounts of the Company and its wholly-owned subsidiaries, DelMar BC, Callco, and Exchangeco. All intercompany balances and transactions have been eliminated.

The principal accounting policies applied in the preparation of these financial statements are set out below and have been consistently applied to all periods presented.

Unaudited interim financial data

The accompanying unaudited March 31, 2015 consolidated condensed interim balance sheet, the consolidated condensed interim statements of loss and comprehensive loss for the three and nine months ended March 31, 2015 and 2014, and consolidated condensed cash flows for the nine months ended March 31, 2015 and 2014, and the related interim information contained within the notes to the consolidated condensed interim financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission for interim financial information. Accordingly, they do not include all of the information and the notes required by U.S. GAAP for complete financial statements. These consolidated condensed interim financial statements should read in conjunction with the audited financial statements of the Company as at June 30, 2014 and December 31, 2013 filed in our Form 10-KT filed with the Securities and Exchange Commission on August 28, 2014. In the opinion of management, the unaudited consolidated condensed interim financial statements reflect all adjustments, consisting of normal and recurring adjustments, necessary for the fair statement of the Company’s financial position at March 31, 2015 and results of its operations for the three and nine months ended March 31, 2015 and 2014, and its cash flows for the nine months ended March 31, 2015 and 2014. The results for three and nine months ended March 31, 2015 are not necessarily indicative of the results to be expected for the fiscal year ending June 30, 2015 or for any other future annual or interim period.

Use of estimates

The preparation of consolidated condensed interim financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions about future events that affect the reported amounts of assets, liabilities, expenses, contingent assets and contingent liabilities as at the end or during the reporting period. Actual results could significantly differ from those estimates. Significant areas requiring management to make estimates include the derivative liability and the valuation of equity instruments, including stock options, issued for services. We have updated our estimates and models for the issuance of any new awards issued during the period.

Loss per share

Loss per share is calculated based on the weighted average number of common shares outstanding. For the three and nine month periods ended March 31, 2015 and for the three months ended March 31, 2014 diluted loss per share does not differ from basic loss per share since the effect of the Company’s warrants and stock options are anti-dilutive. At March 31, 2015, potential common shares of 13,472,870 (March 31, 2014 – 22,392,696) relating to warrants and 3,595,000 (March 31, 2014 – 3,240,000) relating to stock options were excluded from the calculation of net loss per common share because their inclusion would be anti-dilutive.

For the nine months ended March 31, 2014 diluted income per share has also been presented.  Diluted income per share is calculated using the treasury stock method which uses the weighted average number of common shares outstanding during the period and also includes the dilutive effect of potentially issuable common shares from outstanding stock options and warrants.

 

Recent accounting pronouncements

 

The Company reviews new accounting standards as issued. The accounting pronouncements issued subsequent to the date of these financial statements that were considered significant by management were evaluated for the potential effect on these financial statements. Management does not believe any of the subsequent pronouncements will have a material effect on these financial statements as presented and does not anticipate the need for any future restatement of these financial statements because of the retro-active application of any accounting pronouncements issued subsequent to March 31, 2015 through the date these financial statements were issued.

 

Accounting Standards Update (“ASU”) 2014-15 - Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern

 

The objective of the guidance is to require management to explicitly assess an entity's ability to continue as a going concern, and to provide related footnote disclosures in certain circumstances. In connection with each annual and interim period, management will assess if there is substantial doubt about an entity's ability to continue as a going concern within one year after the issuance date of an entity’s financial statements. The new standard defines substantial doubt and provides examples of indicators thereof. The definition of substantial doubt incorporates a likelihood threshold of "probable" similar to the current use of that term in U.S. GAAP for loss contingencies. The new standard will be effective for all entities in the first annual period ending after December 15, 2016 (December 31, 2016 for calendar year-end entities). Earlier application is permitted. The Company is currently assessing this standard for its impact on future reporting periods.

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Valent Technologies LLC Agreement
9 Months Ended
Mar. 31, 2015
Valent Technologies Llc Agreement [Abstract]
Valent Technologies LLC agreement
3Valent Technologies LLC agreement

On September 30, 2014, the Company entered into an exchange agreement (the “Exchange Agreement”) with Valent Technologies, LLC (“Valent”), an entity owned by Dr. Dennis Brown, the Company’s Chief Scientific Officer and director, and DelMar (BC). Pursuant to the Exchange Agreement, Valent exchanged its loan payable in the outstanding amount of $278,530 (including aggregate accrued interest to September 30, 2014 of $28,530), issued to Valent by DelMar (BC), for 278,530 shares of the Company’s Series A Preferred Stock.

 

Effective September 30, 2014, the Company filed a Certificate of Designation of Series A Preferred Stock (the “Series A Certificate of Designation”) with the Secretary of State of Nevada. Pursuant to the Series A Certificate of Designation, the Company designated 278,530 shares of preferred stock as Series A Preferred Stock. The shares of Series A Preferred Stock have a stated value of $1.00 per share (the “Stated Value”) and are not convertible into common stock. The holder of the Series A Preferred Stock will be entitled to dividends at the rate of 3% of the Stated Value per year, payable quarterly in arrears. Upon any liquidation of the Company, the holder of the Series A Preferred Stock will be entitled to be paid, out of any assets of the Company available for distribution to stockholders, the Stated Value of the shares of Series A Preferred Stock held by such holder, plus any accrued but unpaid dividends thereon, prior to any payments being made with respect to the common stock.

For the three months ended March 31, 2015, the Company accrued $2,089 related to the dividend payable to Valent. The dividend has been recorded as a direct increase in accumulated deficit and was paid subsequent to March 31, 2015. For the three months ended March 31, 2014 the Company accrued $2,015 in interest on its loan payable with Valent.

 

For the nine months ended March 31, 2015, the Company recorded $4,178 related to the dividend payable to Valent and $2,091 related to interest from July 1, 2014 to September 30, 2014 when the loan was converted to preferred stock. The dividend of $4,178 has been recorded as a direct increase in accumulated deficit while the $2,091 has been recorded as interest expense. For the nine months ended March 31, 2014 the Company accrued $6,088 in interest expense on its loan payable with Valent.

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Related Party Transactions
9 Months Ended
Mar. 31, 2015
Related Party Transactions [Abstract]
Related party transactions
4Related party transactions

During the nine months ended March 31, 2015

Effective September 30, 2014, the Company entered into and closed an agreement with Valent to exchange its loan with Valent for 278,530 shares of preferred stock of the Company (note 3).

Pursuant to consulting agreements with the Company’s officers the Company recognized a total of $385,000 in compensation expense for the nine months ended March 31, 2015.

Included in accounts payable at March 31, 2015 is an aggregate amount of $43,503 (June 30, 2014 - $54,960) owed to the Company’s officers and directors for fees and expenses. The Company pays related party payables incurred for fees and expenses under normal commercial terms.

The Company recognized $77,667 in directors’ fees during the nine months ended March 31, 2015.

During the nine months ended March 31, 2014

Pursuant to consulting agreements with the Company’s officers the Company recognized a total of $311,000 in compensation expense for the nine months ended March 31, 2014. 

 

The Company recognized $53,333 in directors’ fees during the nine months ended March 31, 2014.

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Derivative Liability
9 Months Ended
Mar. 31, 2015
Derivative liability [Abstract]
Derivative liability
5Derivative liability

The Company has issued common stock purchase warrants. Based on the terms of certain of these warrants the Company determined that the warrants were a derivative liability which is recognized at fair value at the date of the transaction and re-measured at fair value each reporting period with the changes in fair value recorded in the consolidated condensed statement of loss and comprehensive loss.

Investor Warrants

Tender offer – Investor Warrant exercise price reduction

On June 9, 2014, as amended on June 26, 2014, July 10, 2014, and July 29, 2014, the Company filed a tender offer statement with the Securities and Exchange Commission with respect to certain warrants to purchase common stock of the Company issued to investors (the “Investor Warrants”) to provide the holders thereof with the opportunity to amend and exercise their warrants, upon the terms and subject to the conditions set forth in the Company’s tender offer statement. Pursuant to the tender offer, the Company offered to amend Investor Warrants to purchase an aggregate of 9,195,478 shares of common stock (the “Offer to Amend and Exercise”). There was no minimum participation requirement with respect to the Offer to Amend and Exercise.

Pursuant to the Offer to Amend and Exercise, the Investor Warrants subject to the tender offer were amended (the “Amended Warrants”) to: (i) reduce the exercise price of the Investor Warrants from $0.80 per share to $0.65 per share of common stock in cash, (ii) shorten the exercise period of the Investor Warrants so that they expire concurrently with the expiration of the Offer to Amend and Exercise at 5:00 p.m. (Pacific Time) on August 8, 2014, as may be extended by the Company in its sole discretion (“Expiration Date”), (iii) delete the price-based anti-dilution provisions contained in the Investor Warrants, (iv) restrict the ability of the holder of shares issuable upon exercise of the Amended Warrants to sell, make any short sale of, loan, grant any option for the purchase of, or otherwise dispose of any of such shares without the prior written consent of the Company for a period of time twenty (20) days after the Expiration Date (the “ Lock-Up Period ”); and (v) provide that a holder, acting alone or with others, will agree not to effect any purchases or sales of any securities of the Company in any “short sales” as defined in Rule 200 promulgated under Regulation SHO under the Exchange Act, or any type of direct and indirect stock pledges, forward sale contracts, options, puts, calls, short sales, swaps, “put equivalent positions” (as defined in Rule 16a-1(h) under the Exchange Act) or similar arrangements, or sales or other transactions through non-U.S. broker dealers or foreign regulated brokers through the expiration of the Lock-Up Period.

Upon the expiration of the Offer to Amend and Exercise on August 8, 2014, 762,227 Amended Warrants were exercised for net proceeds of $470,676 after payment by the Company of a 5% warrant agent fee of $24,772.

Investor Warrant exercises

During the nine months ended March 31, 2015, an additional 1,223,847 Investor Warrants were exercised at $0.65 per share for 1,223,847 shares of common stock. The Company received proceeds of $795,501 from these exercises.

All Investor Warrants that have been exercised during the period, including those exercised under the tender offer, were revalued at their respective exercise dates and then a reclassification to equity was recorded. As a result of all of the Investor Warrant exercises, for the nine months ended March 31, 2015 an aggregate $391,422 of the derivative liability has been reclassified to equity.

To date, including Investor Warrants exercised prior to June 30, 2014, a total of 5,915,598 Investor Warrants have been exercised for cash for total gross proceeds of $3,886,736.

Investor Warrant exchange

On December 31, 2014, the Company issued 414,889 shares of common stock in exchange for 1,244,666 Investor Warrants. The Investor Warrants that have been exchanged were revalued at their exchange date and then a reclassification to equity was recorded. The reclassification to equity upon the exchange was $305,112. The Company recognized a loss of $92,843 at the time of the exchange.

Tender offer warrant exchange

On January 8, 2015, the Company filed a tender offer statement with the Securities and Exchange Commission, and on January 23, 2015, the Company filed an amendment thereto, with respect to certain Investor Warrants to purchase common stock of the Company. The tender offer provided the holders of the Investor Warrants with the opportunity to receive one share of common stock for every three Investor Warrants tendered. The tender offer was available to all 5,964,738 Investor Warrants outstanding on January 8, 2015. To participate in the tender offer the Investor Warrant holders were required to deliver completed exchange documents to the Company, prior to the expiration of the tender offer, which was 5:00 p.m. (Pacific Time) on February 9, 2015.

The tender offer expired on February 9, 2015. A total of 1,591,875 Investor Warrants were exchanged for 530,625 shares of common stock. The Investor Warrants that have been exchanged were revalued at their exchange date and then a reclassification to equity was recorded. The reclassification to equity upon the exchange was $423,723. The Company recognized a loss of $156,219 at the time of the exchange.

The remaining 4,372,863 Investor Warrants outstanding at March 31 , 2015 have been re-valued at March 31, 2015 using a simulated probability valuation model using the following assumptions: dividend rate - 0%, volatility - 77%, risk free rate – 1.09% and a term of approximately 3.0 years.

All 4,372,863 Investor Warrants outstanding at March 31, 2015 have an exercise price of $0.80.

Dividend Warrants

In connection with the reverse acquisition, effective January 24, 2013, the Company effected a warrant dividend (the “Warrant Dividend”) pursuant to which the Company issued one five-year warrant to purchase one share of common stock at an exercise price of $1.25 for each outstanding share of common stock (the “Dividend Warrants”). Pursuant to the Warrant Dividend, the Company issued an aggregate of 3,250,007 Dividend Warrants.

On October 31, 2014, the Company and all of its Dividend Warrant holders entered into amendments to the Dividend Warrants such that the Company’s redemption rights and certain provisions of the Dividend Warrant agreements relating to potential cash settlement of the Dividend Warrants were removed. The Dividend Warrants were revalued to the date of the amendment on October 31, 2014 which resulted in a reclassification to equity of $975,278.

Warrants issued for services

The Company has issued 300,000 warrants for services. The warrants were issued on September 12, 2013 and are exercisable on a cashless basis at an exercise price of $1.76 for five years. The warrants have been measured at March 31, 2015 using a simulated probability valuation model using the following assumptions: dividend rate - 0%, volatility - 77%, risk free rate – 1.22% and a term of approximately 3.25 years.

The Company’s derivative liability is summarized as follows:

   

March 31,

2015

$

   

June 30,

2014

$

 
         
Opening balance  3,329,367   4,402,306 
         
Change in fair value of warrants  276,963   166,388 
Change in fair value due to change in warrant terms  (23,658)  (111,179)
Reclassification to equity upon amendment of warrants  (975,278)  - 
Reclassification to equity upon exchange of warrants  (728,835)  - 
Reclassification to equity upon exercise of warrants  (391,422)  (1,128,148)
         
Closing balance  1,487,137   3,329,367 

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Stockholders' equity
9 Months Ended
Mar. 31, 2015
Stockholders Equity [Abstract]
Stockholders' equity
6Stockholders’ equity

Preferred stock

 

Authorized

 

5,000,000 preferred shares, $0.001 par value

 

Issued and outstanding

 

Special voting shares – at March 31, 2015 and June 30, 2014 – 1

 

Series A shares – at March 31, 2015 – 278,530 (June 30, 2014 – none)

 

Effective September 30, 2014 pursuant to the Company’s Exchange Agreement with Valent (note 3), the Company filed the Series A Certificate of Designation with the Secretary of State of Nevada. Pursuant to the Series A Certificate of Designation, the Company designated 278,530 shares of preferred stock as Series A Preferred Stock. The shares of Series A Preferred Stock have a stated value of $1.00 per share (the “Stated Value”) and are not convertible into common stock. The holder of the Series A Preferred Stock will be entitled dividends at the rate of 3% of the Stated Value per year, payable quarterly in arrears. Upon any liquidation of the Company, the holder of the Series A Preferred Stock will be entitled to be paid, out of any assets of the Company available for distribution to stockholders, the Stated Value of the shares of Series A Preferred Stock held by such holder, plus any accrued but unpaid dividends thereon, prior to any payments being made with respect to the common stock.

Common stock

 

Authorized

 

200,000,000 common shares, $0.001 par value

 

Issued and outstanding

 

March 31, 2015 – 39,455,931 (June 30, 2014 – 35,992,343)

 

The issued and outstanding common shares at March 31, 2015 include 4,256,042 shares of common stock on an as-exchanged basis with respect to the shares of Exchangeco that can be exchanged for shares of common stock of the Company.

 

   Shares of common stock 
outstanding
  Common stock  Additional paid-in capital  Warrants 
              
 Balance – June 30, 2014  35,992,343   35,992   13,286,278   6,200,445 
                  
 Exercise of Investor Warrants – net of issue costs  1,986,074   1,986   1,264,191   - 
 Reclassification of derivative liability to equity upon exercise of warrants  -   -   391.422   - 
 Shares issued upon warrant exchange  945,514   946   976,951   - 
 Reclassification of derivative liability to equity upon amendment of warrant terms  -   -   975,278   - 
 Exercise of Broker Warrants for cash (a)  345,000   345   187,034   (49,379)
 Shares issued for services  187,000   187   181,000   - 
 Expiration of Broker Warrants (b)  -   -   12,640   (12,640)
 Reclassification of stock option liability upon forfeiture of stock options  -   -   38,038   - 
 Stock-based compensation  -   -   142,447   - 
                  
 Balance – March 31, 2015  39,455,931   39,456   17,455,279   6,138,426 

 

a)During the nine months ended March 31, 2015, 345,000 warrants issued for certain broker services (“Broker Warrants”) were exercised for cash proceeds of $138,000.
b)During the nine months ended March 31, 2015 92,000 Broker Warrants exercisable at a price of CDN $0.50 per warrant expired.

Stock Options

 

The following table sets forth the stock options outstanding:

 

   Number of 
stock 
options 
outstanding
  Weighted 
average 
exercise 
price 
$
 
        
 Balance – June 30, 2014  3,187,214   0.96 
 Granted  600,000   0.88 
 Cancelled  (120,000)  1.05 
 Forfeited  (72,214)  0.58 
 Balance – March 31, 2015  3,595,000   0.94 

 

The following table summarizes stock options outstanding and exercisable at March 31, 2015:

 

 

Exercise price

$

   

Number

outstanding at

March 31,

2015

   

Weighted

average

remaining

contractual

life

(years)

   

Weighted

average

exercise

price

$

   

Number

exercisable

at

March 31,

2014

   

Exercise

price

$

 
                       
 0.39   825,000   6.87   0.39   818,833   0.39 
 0.74   180,000   9.84   0.74   21,778   0.74 
 0.80   120,000   10.0   0.80   -   0.80 
 1.00   300,000   4.50   1.00   50,000   1.00 
 1.05   1,870,000   8.37   1.05   1,554,389   1.05 
 1.54   180,000   8.00   1.54   180,000   1.54 
 2.30   120,000   8.17   2.30   120,000   2.30 
     3,595,000       0.94   2,745,000   0.94 
                       

 

Included in the number of stock options outstanding are 825,000 stock options granted at an exercise price of CDN $0.50. The exercise prices for these stock options shown in the above table have been converted to $0.39 USD using the period ending closing exchange rate. Certain stock options have been granted to non-employees and will be revalued at each reporting date until they have fully vested. The stock options have been re-valued using a Black-Scholes pricing model using the following assumptions:

 

   March 31, 
2015
 
     
 Dividend rate  0%
 Volatility  68.7% to 94.5% 
 Risk-free rate  1.00% to 1.25% 
 Term - years  0.25 to 3.0 

 

The Company has recognized the following amounts as stock-based compensation expense for the periods noted:

 

   Three months ended March 31,  Nine months ended March 31, 
   2015  2014  2015  2014 
    $   $   $   $ 
 Research and development  26,853   171,947   39,909   385,536 
 General and administrative  35,995   133,127   102,262   499,817 
                  
    62,848   305,074   142,171   885,353 

 

Of the total stock option expense of $142,171 (March 31, 2014 - $885,353) for the nine months ended March 31, 2015, $142,447 (March 31, 2014 - $954,747) has been recognized as additional paid in capital and $276 (March 31, 2014 – a reduction of $69,394) has been recognized as reduction to stock option liability. The aggregate intrinsic value of stock options outstanding at March 31, 2015 was $345,131 (March 31, 2014 - $1,008,330) and the aggregate intrinsic value of stock options exercisable at March 31, 2015 was $333,139 (March 31, 2014 - $734,111). As of March 31, 2015 there was $127,200 in unrecognized compensation expense that will be recognized over the next three years. No stock options granted under the Plan have been exercised to March 31, 2015. Upon the exercise of stock options new shares will be issued.

 

A summary of the status of the Company’s unvested stock options under all plans is presented below:

 

   Number of 
Options
  Weighted 
average 
exercise 
price 
$
  Weighted 
average 
grant date 
fair value 
$
 
           
 Unvested at June 30, 2014  735,681   0.98   0.54 
 Granted  600,000   0.88   0.32 
 Vested  (293,467)  0.97   0.48 
 Cancelled  (120,000)  1.05   0.57 
 Forfeited  (72,214)  0.52   0.36 
              
 Unvested at March 31, 2015  850,000   0.94   0.42 

 

Certain of the Company’s warrants have been recognized as a derivative liability (note 5). The following table summarizes all of the Company’s outstanding warrants as of March 31, 2015:

 

 Description Number 
     
 Balance – June 30, 2014  18,732,485 
 Broker Warrants (i)  (92,000)
 Broker Warrants (ii)  (345,000)
 Investor Warrants exercised (iii)  (1,986,074)
 Investor Warrants exchanged (iv)  (2,836,541)
      
 Balance - March 31, 2015  13,472,870 

 

i)During the nine months ended March 31, 2015, 92,000 Broker Warrants expired.
ii)During the nine months ended March 31, 2015, 345,000 Broker Warrants were exercised for cash.
iii)During the nine months ended March 31, 2015, 1,986,074 Investor Warrants were exercised for 1,986,074 shares of common stock (note 5).
iv)During the nine months ended March 31, 2015, 2,836,541 Investor Warrants were exchanged for 945,514 shares of common stock (note 5).
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Financial instruments
9 Months Ended
Mar. 31, 2015
Financial instruments [Abstract]
Financial instruments
7Financial instruments

The Company has financial instruments that are measured at fair value. To determine the fair value, we use the fair value hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs market participants would use to value an asset or liability and are developed based on market data obtained from independent sources. Unobservable inputs are inputs based on assumptions about the factors market participants would use to value an asset or liability. The three levels of inputs that may be used to measure fair value are as follows:

·Level one - inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities;

 

·Level two - inputs are inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly such as interest rates, foreign exchange rates, and yield curves that are observable at commonly quoted intervals; and

 

·Level three - unobservable inputs developed using estimates and assumptions, which are developed by the reporting entity and reflect those assumptions that a market participant would use.

 

Assets and liabilities are classified based on the lowest level of input that is significant to the fair value measurements. Changes in the observability of valuation inputs may result in a reclassification of levels for certain securities within the fair value hierarchy.

The Company’s financial instruments consist of cash and cash equivalents, other receivables, accounts payable, related party payables and derivative liability. The carrying values of cash and cash equivalents, other receivables, accounts payable, and related party payables approximate their fair values due to the immediate or short-term maturity of these financial instruments.

As quoted prices for the derivative liability are not readily available, the Company has used a simulated probability valuation model, as described in note 5 to estimate fair value. The derivative liability utilizes Level 3 inputs as defined above.

The Company has the following liabilities under the fair value hierarchy:

  March 31, 2015 
          
Liability  Level 1   Level 2   Level 3 
             
Derivative liability  -   -   1,487,137 
 

 

  June 30, 2014 
          
Liability  Level 1   Level 2   Level 3 
             
Derivative liability  -   -   3,329,367 
 

 

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Significant Accounting Policies (Policies)
9 Months Ended
Mar. 31, 2015
Significant Accounting Policies [Abstract]
Basis of presentation

Basis of presentation

The consolidated condensed interim financial statements of the Company have been prepared in accordance with United States Generally Accepted Accounting Principles (“U.S. GAAP”) and are presented in United States dollars. The Company’s functional currency is the United States dollar.

In the quarter ended March 31, 2013, the Company’s functional currency changed from Canadian dollars to United States dollars as a result of various objective factors. Therefore translation of goods and services in a foreign currency are re-measured to the functional currency of the Company with gains and losses on re-measurement recorded in the consolidated condensed interim statement of loss. Any gains and losses that were previously recorded in accumulated other comprehensive income are unchanged from the date of the change of functional currency which was January 1, 2013.

The accompanying consolidated condensed interim financial statements include the accounts of the Company and its wholly-owned subsidiaries, DelMar BC, Callco, and Exchangeco. All intercompany balances and transactions have been eliminated.

The principal accounting policies applied in the preparation of these financial statements are set out below and have been consistently applied to all periods presented.

Unaudited interim financial data

Unaudited interim financial data

The accompanying unaudited March 31, 2015 consolidated condensed interim balance sheet, the consolidated condensed interim statements of loss and comprehensive loss for the three and nine months ended March 31, 2015 and 2014, and consolidated condensed cash flows for the nine months ended March 31, 2015 and 2014, and the related interim information contained within the notes to the consolidated condensed interim financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission for interim financial information. Accordingly, they do not include all of the information and the notes required by U.S. GAAP for complete financial statements. These consolidated condensed interim financial statements should read in conjunction with the audited financial statements of the Company as at June 30, 2014 and December 31, 2013 filed in our Form 10-KT filed with the Securities and Exchange Commission on August 28, 2014. In the opinion of management, the unaudited consolidated condensed interim financial statements reflect all adjustments, consisting of normal and recurring adjustments, necessary for the fair statement of the Company’s financial position at March 31, 2015 and results of its operations for the three and nine months ended March 31, 2015 and 2014, and its cash flows for the nine months ended March 31, 2015 and 2014. The results for three and nine months ended March 31, 2015 are not necessarily indicative of the results to be expected for the fiscal year ending June 30, 2015 or for any other future annual or interim period.

Use of estimates

Use of estimates

The preparation of consolidated condensed interim financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions about future events that affect the reported amounts of assets, liabilities, expenses, contingent assets and contingent liabilities as at the end or during the reporting period. Actual results could significantly differ from those estimates. Significant areas requiring management to make estimates include the derivative liability and the valuation of equity instruments, including stock options, issued for services. We have updated our estimates and models for the issuance of any new awards issued during the period.

Loss per share

Loss per share

Loss per share is calculated based on the weighted average number of common shares outstanding. For the three and nine month periods ended March 31, 2015 and for the three months ended March 31, 2014 diluted loss per share does not differ from basic loss per share since the effect of the Company’s warrants and stock options are anti-dilutive. At March 31, 2015, potential common shares of 13,472,870 (March 31, 2014 – 22,392,696) relating to warrants and 3,595,000 (March 31, 2014 – 3,240,000) relating to stock options were excluded from the calculation of net loss per common share because their inclusion would be anti-dilutive.

For the nine months ended March 31, 2014 diluted income per share has also been presented.  Diluted income per share is calculated using the treasury stock method which uses the weighted average number of common shares outstanding during the period and also includes the dilutive effect of potentially issuable common shares from outstanding stock options and warrants.

Recent accounting pronouncements

Recent accounting pronouncements

 

The Company reviews new accounting standards as issued. The accounting pronouncements issued subsequent to the date of these financial statements that were considered significant by management were evaluated for the potential effect on these financial statements. Management does not believe any of the subsequent pronouncements will have a material effect on these financial statements as presented and does not anticipate the need for any future restatement of these financial statements because of the retro-active application of any accounting pronouncements issued subsequent to March 31, 2015 through the date these financial statements were issued.

 

Accounting Standards Update (“ASU”) 2014-15 - Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern

 

The objective of the guidance is to require management to explicitly assess an entity's ability to continue as a going concern, and to provide related footnote disclosures in certain circumstances. In connection with each annual and interim period, management will assess if there is substantial doubt about an entity's ability to continue as a going concern within one year after the issuance date of an entity’s financial statements. The new standard defines substantial doubt and provides examples of indicators thereof. The definition of substantial doubt incorporates a likelihood threshold of "probable" similar to the current use of that term in U.S. GAAP for loss contingencies. The new standard will be effective for all entities in the first annual period ending after December 15, 2016 (December 31, 2016 for calendar year-end entities). Earlier application is permitted. The Company is currently assessing this standard for its impact on future reporting periods.

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Derivative Liability (Tables)
9 Months Ended
Mar. 31, 2015
Derivative liability [Abstract]
Shedule of derivative liabilities
   

March 31,

2015

$

   

June 30,

2014

$

 
         
Opening balance  3,329,367   4,402,306 
         
Change in fair value of warrants  276,963   166,388 
Change in fair value due to change in warrant terms  (23,658)  (111,179)
Reclassification to equity upon amendment of warrants  (975,278)  - 
Reclassification to equity upon exchange of warrants  (728,835)  - 
Reclassification to equity upon exercise of warrants  (391,422)  (1,128,148)
         
Closing balance  1,487,137   3,329,367 

 

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Stockholders' equity (Tables)
9 Months Ended
Mar. 31, 2015
Stockholders Equity [Abstract]
Schedule of common stock issued and outstanding

   

Shares of common stock

outstanding

   Common stock   Additional paid-in capital   

 

 

 

Warrants

 
                 
Balance – June 30, 2014  35,992,343   35,992   13,286,278   6,200,445 
                 
Exercise of Investor Warrants – net of issue costs  1,986,074   1,986   1,264,191   - 
Reclassification of derivative liability to equity upon exercise of warrants  -   -   391.422   - 
Shares issued upon warrant exchange  945,514   946   976,951   - 
Reclassification of derivative liability to equity upon amendment of warrant terms  -   -   975,278   - 
Exercise of Broker Warrants for cash (a)  345,000   345   187,034   (49,379)
Shares issued for services  187,000   187   181,000   - 
Expiration of Broker Warrants (b)  -   -   12,640   (12,640)
Reclassification of stock option liability upon forfeiture of stock options  -   -   38,038   - 
Stock-based compensation  -   -   142,447   - 
                 
Balance – March 31, 2015  39,455,931   39,456   17,455,279   6,138,426 

 

a)During the nine months ended March 31, 2015, 345,000 warrants issued for certain broker services (“Broker Warrants”) were exercised for cash proceeds of $138,000.
b)During the nine months ended March 31, 2015 92,000 Broker Warrants exercisable at a price of CDN $0.50 per warrant expired.
Schedule of options outstanding under the plan
     

Number of

stock

options

outstanding

   

Weighted

average

exercise

price

$

 
           
 Balance – June 30, 2014   3,187,214   0.96 
 Issued   300,000   1.00 
 Forfeited   (72,214)  0.58 
 Balance – December 31, 2014   3,415,000   0.97 
 

 

Schedule of stock options currently outstanding and exercisable

 

Exercise price

$

   

Number

outstanding at

March 31,

2015

   

Weighted

average

remaining

contractual

life

(years)

   

Weighted

average

exercise

price

$

   

Number

exercisable

at

March 31,

2014

   

Exercise

price

$

 
                       
 0.39   825,000   6.87   0.39   818,833   0.39 
 0.74   180,000   9.84   0.74   21,778   0.74 
 0.80   120,000   10.0   0.80   -   0.80 
 1.00   300,000   4.50   1.00   50,000   1.00 
 1.05   1,870,000   8.37   1.05   1,554,389   1.05 
 1.54   180,000   8.00   1.54   180,000   1.54 
 2.30   120,000   8.17   2.30   120,000   2.30 
     3,595,000       0.94   2,745,000   0.94 
                       
Schedule of stock options valuation assumptions using a Black-Scholes pricing model

  

March 31,

2015

   
Dividend rate 0%
Volatility 68.7% to 94.5%
Risk-free rate 1.00% to 1.25%
Term - years 0.25 to 3.0
Schedule of stock-based compensation expense

  Three months ended March 31,  Nine months ended March 31, 
   2015  2014  2015$  2014
   $   $   $   $ 
Research and development  26,853   171,947   39,909   385,536 
General and administrative  35,995   133,127   102,262   499,817 
                 
   62,848   305,074   142,171   885,353 
Schedule of unvested stock options

     

Number of

Options

   

Weighted

average

exercise

price

$

   

Weighted

average

grant date

fair value

$

 
               
 Unvested at June 30, 2014   735,681   0.98   0.54 
 Granted   600,000   0.88   0.32 
 Vested   (293,467)  0.97   0.48 
 Cancelled   (120,000)  1.05   0.57 
 Forfeited   (72,214)  0.52   0.36 
               
 Unvested at March 31, 2015   850,000   0.94   0.42 
Schedule of outstanding warrants

Description  Number 
     
Balance – June 30, 2014  18,732,485 
Broker Warrants (i)  (92,000)
Broker Warrants (ii)  (345,000)
Investor Warrants exercised (iii)  (1,986,074)
Investor Warrants exchanged (iv)  (2,836,541)
     
Balance - March 31, 2015  13,472,870 

 

i)During the nine months ended March 31, 2015, 92,000 Broker Warrants expired.
ii)During the nine months ended March 31, 2015, 345,000 Broker Warrants were exercised for cash.
iii)During the nine months ended March 31, 2015, 1,986,074 Investor Warrants were exercised for 1,986,074 shares of common stock (note 5).
iv)During the nine months ended March 31, 2015, 2,836,541 Investor Warrants were exchanged for 945,514 shares of common stock (note 5).
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Financial instruments (Tables)
9 Months Ended
Mar. 31, 2015
Financial instruments [Abstract]
Schedule of derivative liabilities under the fair value hierarchy
  March 31, 2015 
          
Liability  Level 1   Level 2   Level 3 
             
Derivative liability  -   -   1,487,137 
 

 

  June 30, 2014 
          
Liability  Level 1   Level 2   Level 3 
             
Derivative liability  -   -   3,329,367 
 

 

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Going Concern and Nature of Operations (Details) (USD $)
3 Months Ended 9 Months Ended
Mar. 31, 2015
Mar. 31, 2014
Mar. 31, 2015
Mar. 31, 2014
Jun. 30, 2014
Jun. 30, 2013
Going Concern and Nature of Operations [Abstract]
Net and comprehensive loss (income) for the period $ 1,649,136 $ 3,198,607 $ 4,048,256 $ (2,729,649)
Accumulated deficit (22,715,848) (22,715,848) (18,663,414)
Additional paid in capital 2,883,603 2,883,603
Cash and cash equivalents 3,006,598 3,474,150 3,006,598 3,474,150 4,759,711 6,282,992
Net proceeds from exercise of warrants 1,404,177
Number of warrants exercised 2,331,074
Negative cash flow from operations $ (3,044,475) $ (3,030,692)
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Significant Accounting Policies (Details)
9 Months Ended
Mar. 31, 2015
Mar. 31, 2014
Common stock
Significant Accounting Policies [Line Items]
Antidilutive securities excluded from computation of earnings per share 13,472,870 22,392,696
Stock options [Member]
Significant Accounting Policies [Line Items]
Antidilutive securities excluded from computation of earnings per share 3,595,000 3,240,000
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Valent Technologies LLC Agreement (Details) (USD $)
3 Months Ended 9 Months Ended 3 Months Ended
Mar. 31, 2015
Mar. 31, 2014
Mar. 31, 2015
Mar. 31, 2014
Sep. 30, 2014
Jun. 30, 2014
Agreement [Line Items]
Preferred Stock, par value (in dollars per share) $ 0.001 $ 0.001 $ 0.001
Interest expense    $ (2,015) $ (2,091) $ (6,088)
Dividends payable 4,178 4,178
Series A Preferred Stock [Member]
Agreement [Line Items]
Preferred stock, issued 278,530 278,530 278,530
Preferred Stock, dividend rate percentage 3.00%
Valent Technologies, LLC [Member]
Agreement [Line Items]
Loan payable 278,530
Aggregate accrued interest 28,530
Accrued dividend payable 2,089 4,178
Loans payable to accured interest $ 2,015 $ 6,088 2,091
Valent Technologies, LLC [Member] | Series A Preferred Stock [Member]
Agreement [Line Items]
Preferred Stock, par value (in dollars per share) 1
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Related Party Transactions (Details) (USD $)
9 Months Ended
Mar. 31, 2015
Mar. 31, 2014
Jun. 30, 2014
Sep. 30, 2014
Related Party Transaction [Line Items]
Aggregate amount owing to officers and directors for fees and expenses $ 43,503 $ 54,960
Valent Technologies, LLC [Member]
Related Party Transaction [Line Items]
Loans Payable, Current 278,530
Officer and Director | Consulting Agreement
Related Party Transaction [Line Items]
Cash compensation to officers 385,000 311,000
Aggregate amount owing to officers and directors for fees and expenses 43,503 54,960
Director fees recognized $ 77,667 $ 53,333
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Derivative Liability (Details) (USD $)
1 Months Ended 3 Months Ended 9 Months Ended
Jun. 30, 2014
Mar. 31, 2015
Mar. 31, 2014
Mar. 31, 2015
Mar. 31, 2014
Schedule Of Derivative Liabilities [Roll Forward]
Opening balance $ 4,402,306 $ 3,329,367
Change in fair value of warrants 166,388 343,569 1,599,349 276,963 (6,867,477)
Change in fair value of derivative liability due to change in warrant terms (111,179) 23,658   
Reclassification to equity upon amendment of warrants 975,278   
Reclassification to equity upon exchange of warrants 728,835   
Reclassification to equity upon exercise of warrants (1,128,148) 391,422   
Closing balance $ 3,329,367 $ 1,487,137 $ 1,487,137
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Derivative Liability (Details Textual) (USD $)
9 Months Ended 1 Months Ended 12 Months Ended 0 Months Ended 1 Months Ended 0 Months Ended
Mar. 31, 2015
Mar. 31, 2014
Dec. 31, 2014
Jun. 30, 2014
Feb. 09, 2015
Jan. 08, 2015
Oct. 31, 2014
Aug. 08, 2014
Jun. 09, 2014
Derivative [Line Items]
Exercise Price $ 0.65
Net proceeds from the exercise of warrants $ 1,404,177 $ 221,850
Dividend warrants exercise price $ 1.25
Number of dividend warrants issued 3,250,007
Reclassification of derivative liability to equity upon the exchange of Investor Warrants (note 5) 728,835   
Reclassification of derivative liability to equity upon the amendment of Dividend Warrants (note 5) 975,278   
Loss on exchange of warrants (249,062)   
Investor Warrants [Member]
Derivative [Line Items]
Number of warrants of exercised 1,223,847
Number of warrants outstanding 9,195,478
Investor Warrants [Member] | Maximum [Member]
Derivative [Line Items]
Exercise Price $ 0.8
Investor Warrants [Member] | Minimum [Member]
Derivative [Line Items]
Exercise Price $ 0.65
Investor Warrant Exercises [Member]
Derivative [Line Items]
Common stock shares issued on exercise of warrants 1,223,847 1,244,666
Number of warrants issued 414,889
Reclassification of derivative liability to equity upon exercise of Investor Warrants (note 8) 391,422 305,112
Number of warrants of exercised 5,915,598
Exercise Price $ 0.65
Net proceeds from the exercise of warrants 795,501 3,886,736
Loss on exchange of warrants 92,843
Investor Warrant Exchange [Member]
Derivative [Line Items]
Reclassification of derivative liability to equity upon exercise of Investor Warrants (note 8) 423,723
Number of warrants outstanding 4,372,863 5,964,738
Warrants exercisable description To participate in the tender offer the Investor Warrant holders were required to deliver completed exchange documents to the Company, prior to the expiration of the tender offer, which was 5:00 p.m. (Pacific Time) on February 9, 2015.
Exercise Price $ 0.8
Loss on exchange of warrants 156,219
Warrants shares issued on exchanged of common stock 530,625
Dividend Warrants [Member]
Derivative [Line Items]
Reclassification of derivative liability to equity upon the amendment of Dividend Warrants (note 5) 975,278
Warrants Issued for Services [Member]
Derivative [Line Items]
Number of warrants issued 300,000
Exercise Price $ 1.76
Amended Warrants
Derivative [Line Items]
Number of warrants of exercised 762,227
Warrants exercisable description (i) reduce the exercise price of the Investor Warrants from $0.80 per share to $0.65 per share of common stock in cash, (ii) shorten the exercise period of the Investor Warrants so that they expire concurrently with the expiration of the Offer to Amend and Exercise at 5:00 p.m. (Pacific Time) on August 8, 2014, as may be extended by the Company in its sole discretion ("Expiration Date"), (iii) delete the price-based anti-dilution provisions contained in the Investor Warrants, (iv) restrict the ability of the holder of shares issuable upon exercise of the Amended Warrants to sell, make any short sale of, loan, grant any option for the purchase of, or otherwise dispose of any of such shares without the prior written consent of the Company for a period of time twenty (20) days after the Expiration Date (the " Lock-Up Period ")
Agent fee of warrants 24,772
Percentage of agent fee of warrant 5.00%
Net proceeds from the exercise of warrants $ 470,676
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Derivative Liability (Details Textual 1)
9 Months Ended
Mar. 31, 2015
Warrants Issued for Services [Member]
Derivative [Line Items]
Fair value assumptions dividend rate 0.00%
Fair value assumptions volatility rate 77.00%
Fair value assumptions risk free rate 1.22%
Fair value assumptions expected term 3 years 3 months
Investor Warrant Exchange [Member]
Derivative [Line Items]
Fair value assumptions dividend rate 0.00%
Fair value assumptions volatility rate 77.00%
Fair value assumptions risk free rate 1.09%
Fair value assumptions expected term 3 years
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Stockholders' equity (Details) (USD $)
1 Months Ended 9 Months Ended
Jun. 30, 2014
Mar. 31, 2015
Mar. 31, 2014
Schedule Of Common Stock Issued And Outstanding [Line Items]
Balance $ 880,479
Reclassification of derivative liability to equity upon exercise of warrants (1,128,148) 391,422   
Reclassification of derivative liability to equity upon amendment of warrant terms 975,278   
Stock-based compensation 142,447 954,747
Balance 880,479 1,217,021
Common stock [Member]
Schedule Of Common Stock Issued And Outstanding [Line Items]
Balance 35,992
Balance (in shares) 35,992,343
Exercise of Investor Warrants - net of issue costs 1,986
Exercise of Investor Warrants - net of issue costs, shares 1,986,074
Reclassification of derivative liability to equity upon exercise of warrants   
Shares issued upon warrant exchange 946
Shares issued upon warrant exchange, shares 945,514
Reclassification of derivative liability to equity upon amendment of warrant terms   
Exercise of Broker Warrants for cash (a) 345 [1]
Exercise of Broker Warrants for cash (a), shares 345,000 [1]
Shares issued for services 187
Shares issued for services, shares 187,000
Expiration of Broker Warrants (b)    [2]
Reclassification of stock option liability upon forfeiture of stock options   
Stock-based compensation   
Balance 39,456
Balance (in shares) 39,455,931
Additional paid-in capital [Member]
Schedule Of Common Stock Issued And Outstanding [Line Items]
Balance 13,286,278
Exercise of Investor Warrants - net of issue costs 1,264,191
Reclassification of derivative liability to equity upon exercise of warrants 391.422
Shares issued upon warrant exchange 976,951
Reclassification of derivative liability to equity upon amendment of warrant terms 975,278
Exercise of Broker Warrants for cash (a) 187,034 [1]
Shares issued for services 181,000
Expiration of Broker Warrants (b) 12,640 [2]
Reclassification of stock option liability upon forfeiture of stock options 38,038
Stock-based compensation 142,447
Balance 17,455,279
Warrants [Member]
Schedule Of Common Stock Issued And Outstanding [Line Items]
Balance 6,200,445
Exercise of Investor Warrants - net of issue costs   
Reclassification of derivative liability to equity upon exercise of warrants   
Shares issued upon warrant exchange   
Reclassification of derivative liability to equity upon amendment of warrant terms   
Exercise of Broker Warrants for cash (a) (49,379) [1]
Shares issued for services   
Expiration of Broker Warrants (b) (12,640) [2]
Reclassification of stock option liability upon forfeiture of stock options   
Stock-based compensation   
Balance $ 6,138,426
[1] During the nine months ended March 31, 2015, 345,000 warrants issued for certain broker services ("Broker Warrants") were exercised for cash proceeds of $138,000.
[2] During the nine months ended March 31, 2015 92,000 Broker Warrants exercisable at a price of CDN $0.50 per warrant expired.
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Stockholders' equity (Details 1)
9 Months Ended
Mar. 31, 2015
USD ($)
Mar. 31, 2015
CAD
Mar. 31, 2015
Stock options [Member]
USD ($)
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward]
Beginning balance 3,187,214
Granted 825,000 825,000 600,000
Cancelled (120,000)
Forfeited (72,214)
Ending balance 3,595,000 3,595,000 3,595,000
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Roll Forward]
Beginning balance (in Dollars per share) $ 0.96
Granted (in Dollars per share) $ 0.39 0.5 $ 0.88
Cancelled ( in Dollars per share) $ 1.05
Forfeited (in Dollars per share) $ 0.58
Ending balance (in Dollars per share) $ 0.94 $ 0.94
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Stockholders' equity (Details 2) (USD $)
9 Months Ended
Mar. 31, 2015
Jun. 30, 2014
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of stock options outstanding 3,595,000
Weighted average exercise price (in Dollars per share) $ 0.94
Number of stock options exercisable 2,745,000
Exercise price (in Dollars per share) $ 0.94
Stock options [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of stock options outstanding 3,595,000 3,187,214
Weighted average exercise price (in Dollars per share) $ 0.94 $ 0.96
Stock options [Member] | 0.39 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Exercise price (in Dollars per share) $ 0.39
Number of stock options outstanding 825,000
Weighted average remaining contractual life (years) 6 years 10 months 13 days
Weighted average exercise price (in Dollars per share) $ 0.39
Number of stock options exercisable 818,833
Exercise price (in Dollars per share) $ 0.39
Stock options [Member] | 0.74 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Exercise price (in Dollars per share) $ 0.74
Number of stock options outstanding 180,000
Weighted average remaining contractual life (years) 9 years 10 months 2 days
Weighted average exercise price (in Dollars per share) $ 0.74
Number of stock options exercisable 21,778
Exercise price (in Dollars per share) $ 0.74
Stock options [Member] | 0.80 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Exercise price (in Dollars per share) $ 0.8
Number of stock options outstanding 120,000
Weighted average remaining contractual life (years) 10 years
Weighted average exercise price (in Dollars per share) $ 0.8
Number of stock options exercisable   
Exercise price (in Dollars per share) $ 0.8
Stock options [Member] | 1.00 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Exercise price (in Dollars per share) $ 1
Number of stock options outstanding 300,000
Weighted average remaining contractual life (years) 4 years 6 months
Weighted average exercise price (in Dollars per share) $ 1
Number of stock options exercisable 50,000
Exercise price (in Dollars per share) $ 1
Stock options [Member] | 1.05 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Exercise price (in Dollars per share) $ 1.05
Number of stock options outstanding 1,870,000
Weighted average remaining contractual life (years) 8 years 4 months 13 days
Weighted average exercise price (in Dollars per share) $ 1.05
Number of stock options exercisable 1,554,389
Exercise price (in Dollars per share) $ 1.05
Stock options [Member] | 1.54 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Exercise price (in Dollars per share) $ 1.54
Number of stock options outstanding 180,000
Weighted average remaining contractual life (years) 8 years
Weighted average exercise price (in Dollars per share) $ 1.54
Number of stock options exercisable 180,000
Exercise price (in Dollars per share) $ 1.54
Stock options [Member] | 2.30 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Exercise price (in Dollars per share) $ 2.3
Number of stock options outstanding 120,000 120,000
Weighted average remaining contractual life (years) 8 years 2 months 1 day
Weighted average exercise price (in Dollars per share) $ 2.3 $ 2.3
Number of stock options exercisable 120,000
Exercise price (in Dollars per share) $ 2.3
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Stockholders' equity (Details 3) (Stock options [Member])
9 Months Ended
Mar. 31, 2015
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Dividend rate 0.00%
Minimum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Volatility 68.70%
Risk-free rate 1.00%
Term - years 3 months
Maximum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Volatility 94.50%
Risk-free rate 1.25%
Term - years 3 years
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Stockholders' equity (Details 4) (USD $)
3 Months Ended 9 Months Ended
Mar. 31, 2015
Mar. 31, 2014
Mar. 31, 2015
Mar. 31, 2014
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense $ 62,848 $ 305,074 $ 142,171 $ 885,353
Research and development [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense 26,853 171,947 39,909 385,536
General and administrative [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense $ 35,995 $ 133,127 $ 102,262 $ 499,817
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Stockholders' equity (Details 5) (USD $)
9 Months Ended
Mar. 31, 2015
Number of Options
Number of options, Granted 825,000
Stock options [Member]
Number of Options
Number of options unvested, Beginning balance 735,681
Number of options, Granted 600,000
Number of options, Vested (293,467)
Number of options, Cancelled (120,000)
Number of options, Forfeited (72,214)
Number of options unvested, Ending balance 850,000
Weighted Average Exercise Price
Weighted average exercise price unvested, Beginning balance (in Dollars per share) 0.98
Weighted average exercise price unvested, Granted (in Dollars per share) 0.88
Weighted average exercise price unvested, Vested (in Dollars per share) 0.97
Weighted average exercise price unvested, Cancelled (in Dollars per share) 1.05
Weighted average exercise price unvested, Forfeited (in Dollars per share) 0.52
Weighted average exercise price unvested, Ending balance (in Dollars per share) 0.94
Weighted Average Grant Date Fair Value
Weighted average grant date fair value, unvested, Beginning balance (in Dollars per share) 0.54
Weighted average grant date fair value, unvested, Granted (in Dollars per share) 0.32
Weighted average grant date fair value, unvested, Vested (in Dollars per share) 0.48
Weighted average grant date fair value, unvested, Cancelled (in Dollars per share) 0.57
Weighted average grant date fair value, unvested, Forfeited (in Dollars per share) 0.36
Weighted average grant date fair value, unvested, Ending balance (in Dollars per share) 0.42
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Stockholders' equity (Details 6)
9 Months Ended
Mar. 31, 2015
Number Of Warrants [Roll Forward]
Beginning Balance 18,732,485
Broker Warrants (i) (92,000) [1]
Broker Warrants (ii) (345,000) [2]
Investor Warrants exercised (iii) (1,986,074) [3]
Investor Warrants exchanged (iv) (2,836,541) [4]
Ending Balance 13,472,870
[1] During the nine months ended March 31, 2015, 92,000 Broker Warrants expired.
[2] During the nine months ended March 31, 2015, 345,000 Broker Warrants were exercised for cash.
[3] During the nine months ended March 31, 2015, 1,986,074 Investor Warrants were exercised for 1,986,074 shares of common stock (note 5).
[4] During the nine months ended March 31, 2015, 2,836,541 Investor Warrants were exchanged for 945,514 shares of common stock (note 5).
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Stockholders' equity (Detail Textuals) (USD $)
9 Months Ended 3 Months Ended
Mar. 31, 2015
Sep. 30, 2014
Jun. 30, 2014
Stockholders Equity Note [Line Items]
Preferred stock, Par value $ 0.001 $ 0.001
Preferred stock, Shares authorized 5,000,000 5,000,000
Preferred stock special voting shares issued 1 1
Common stock, Shares authorized 200,000,000 200,000,000
Common stock, Par value $ 0.001 $ 0.001
Common stock, shares issued (in shares) 39,455,931 35,992,343
Common stock, Shares outstanding 39,455,931 35,992,343
Stock issued and outstanding on exchanged basis 4,256,042
Series A Preferred Stock [Member]
Stockholders Equity Note [Line Items]
Preferred stock, issued 278,530 278,530
Preferred stock, Shares outstanding 278,530   
Preferred Stock, dividend rate percentage 3.00%
Exchange Agreement | Series A Preferred Stock [Member]
Stockholders Equity Note [Line Items]
Preferred stock, Par value $ 1
Voting and Exchange Trust Agreement
Stockholders Equity Note [Line Items]
Preferred stock special voting shares issued 1 1
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Stockholders' equity (Detail Textuals 1)
9 Months Ended 1 Months Ended 9 Months Ended
Mar. 31, 2015
USD ($)
Mar. 31, 2015
CAD
Mar. 31, 2014
USD ($)
Dec. 31, 2014
USD ($)
Jun. 30, 2014
USD ($)
Dec. 31, 2014
Investor Warrant Exercises [Member]
Mar. 31, 2015
Investor Warrant Exercises [Member]
Mar. 31, 2015
Broker Warrants [Member]
CAD
Stockholders Equity Note [Line Items]
Number of warrants exercisable (1,986,074) [1] (1,986,074) [1] 92,000
Number of warrants exchanged (2,836,541) [2] (2,836,541) [2]
Number of broker warrants (92,000) [3] (92,000) [3]
Stock options granted 825,000 825,000
Stock option expense $ 142,171 $ 885,353
Stock option recognized as additional paid in capital 142,447 954,747
Exercise price $ 0.39 0.5 0.5
Stock option liability 179,445 217,759
Aggregate intrinsic value of stock options outstanding 12,675 345,131
Aggregate intrinsic value of stock options exercisable 333,139 734,111
Unrecognized compensation expense 127,200
Unrecognized compensation expense, period of recognition 5 years 5 years
Number of investort warrants issued 414,889
Common stock shares issued on exercise of warrants 1,244,666 1,223,847
Rrecognized as stock option liability $ 276 $ 69,394
[1] During the nine months ended March 31, 2015, 1,986,074 Investor Warrants were exercised for 1,986,074 shares of common stock (note 5).
[2] During the nine months ended March 31, 2015, 2,836,541 Investor Warrants were exchanged for 945,514 shares of common stock (note 5).
[3] During the nine months ended March 31, 2015, 92,000 Broker Warrants expired.
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Financial instruments (Details) (USD $)
Mar. 31, 2015
Jun. 30, 2014
May 31, 2014
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative liability $ 1,487,137 $ 3,329,367 $ 4,402,306
Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative liability      
Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative liability      
Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative liability $ 1,487,137 $ 3,329,367
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