Quarterly report pursuant to sections 13 or 15(d)

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (USD $)
 9 Months Ended
Sep. 30, 2012
Sep. 30, 2011
CASH FLOWS FROM OPERATING ACTIVITIES:    
Net Loss $ (5,049,776) $ (4,948,674)
Adjustments to reconcile net loss to net cash used in operating activities:    
Depreciation and amortization 140,743 166,161
Loss on sale of research and development inventory 0 1,934,630
Stock based compensation 408,544 19,623
Amortization of debt discount and beneficial conversion charge 0 184,185
Changes in operating assets and liabilities    
Accounts receivable (61,897) 0
Inventories 137,658 481,389
Prepaid Expenses (130,352) (35,504)
Other assets (90,000) 90,000
Accounts payable (412,652) 92,404
Accrued expenses (24,330) 39,706
Accrued interest 1,959 575,173
Deferred rent liability (16,642) (16,642)
Net cash used in operating activities (5,096,745) (1,417,549)
CASH FLOWS FROM INVESTING ACTIVITIES:    
Purchase of equipment (83,521) 0
Net cash used in investing activities (83,521) 0
CASH FLOWS FROM FINANCING ACTIVITIES:    
Proceeds from issuance of common stock, net of note payable conversion 17,287,288 0
Proceeds from convertible notes payable 0 1,200,000
Payment of equity issuance costs (1,266,495) 0
Payments on notes payable (200,000) 0
Payments of leasehold improvement loan (7,901) (7,224)
Net cash provided by financing activities 15,812,892 1,192,776
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 10,632,626 (224,773)
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD 87,771 228,971
CASH AND CASH EQUIVALENTS - END OF PERIOD 10,720,397 4,198
Cash paid for interest 3,820 9,984
Supplemental Disclosure of Noncash Financing Activities:    
Conversion of notes payable and accrued interest into common stock 262,740 0
Reclassification of equity issuance costs to additional paid-in capital 421,077 0
Stock retained by stockholders of shell company $ 53 $ 0