Kyto Technology & Life Science, Inc. - FORM 10-Q

Attached files

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EX-31.2 - CERTIFICATION - Kyto Technology & Life Science, Inc.	kbph_ex312.htm
EX-32.1 - CERTIFICATION - Kyto Technology & Life Science, Inc.	kbph_ex321.htm
EX-31.1 - CERTIFICATION - Kyto Technology & Life Science, Inc.	kbph_ex311.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

———————

FORM 10-Q

———————

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

For the quarterly period ended June 30, 2011

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

For the transition period from: _____________ to _____________

KYTO BIOPHARMA, INC.

(Exact name of registrant as specified in its charter)

FLORIDA	000-50390	65-1086538
(State or Other Jurisdiction	(Commission	(I.R.S. Employer
of Incorporation)	File Number)	Identification No.)

B1-114 Belmont Avenue Toronto, Ontario Canada M5R 1P8

(Address of Principal Executive Office) (Zip Code)

(416) 960-8790

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

———————

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. þ 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 (ss. 232.405 of this chapter) during the preceding 12 (or for such shorter period that the registrant was required to submit and post such files). o 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.

Large accelerated filer	o	Accelerated filer	o
Non-accelerated filer	o	Smaller reporting company	þ

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). ¨ Yes þ No

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

12,998,482 Common Shares - $0.0001 Par Value - as of August 12, 2011

KYTO BIOPHARMA, INC. AND SUBSIDIARY

(A Development Stage Company)

For the quarterly period ended June 30, 2011

INDEX

PART I. FINANCIAL INFORMATION

Item 1.	Financial Statements

	Condensed Consolidated Balance Sheets as of June 30, 2011 (Unaudited) and March 31, 2011	3

	Unaudited Condensed Consolidated Statements of Operations for the Three Months Ended June 30, 2011 and 2010 and for the period from March 5, 1999 (Inception) to June 30, 2011	4

	Unaudited Condensed Statement of Stockholders’ Deficit for three months ended June 30, 2011	5

	Unaudited Condensed Consolidated Statements of Cash Flows for the Three Months Ended June 30, 2011 and 2010 and for the period from March 5, 1999 (Inception) to June 30, 2011	6

	Notes To Unaudited Condensed Consolidated Financial Statements	7

Item 2.	Management’s Discussion and Analysis of Financial Conditions and Results of Operations.	11

Item 3.	Quantitative and Qualitative Disclosures About Market Risk.	12

Item 4.	Controls and Procedures.	13

PART II. OTHER INFORMATION

Item 1.	Legal Proceedings.	14

Item 1A.	Risk Factors.	14

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds.	14

Item 3.	Defaults Upon Senior Securities.	14

Item 4.	(Removed and Reserved)	14

Item 5.	Other Information	14

Item 6.	Exhibits	15

	Signatures	16

PART I - FINANCIAL INFORMATION

ITEM 1.

FINANCIAL STATEMENTS

Kyto Biopharma, Inc. and Subsidiary

(A Development Stage Company)

Condensed Consolidated Balance Sheets

	June 30,			March 31,
	2011			2011
	(Unaudited)

ASSETS
Current Assets
Cash	$	4,891		$	863

Total Current Assets		4,891			863





Total Assets	$	4,891		$	863

LIABILITIES AND STOCKHOLDERS' DEFICIT

Current Liabilities
Accounts payable	$	26,120		$	12,760
Accrued liabilities		15,667			32,667
Accrued liabilities - related party		39,000			29,000
Accrued interest payable - related party		67,887			66,139
Dividends payable - preferred convertible stock		83,008			76,137
Loan payable-related party		1,115,096			1,066,096
Note payable-related party		100,000			100,000
Total Current Liabilities		1,446,778			1,382,799

Commitments and Contingencies

Stockholders' Deficit
Preferred convertible stock, $1.00 par value, 1,000,000 shares
authorized, 473,624 issued and outstanding as of
June 30, 2011 and March 31, 2011 respectively		473,624			473,624
Common stock, $0.0001 par value, 25,000,000 shares
authorized, 12,998,482 issued and outstanding as of
June 30, 2011 and March 31, 2011 respectively		1,300			1,300
Additional paid-in capital		15,919,306			15,904,542
Deficit accumulated during development stage		(17,658,934	)		(17,584,219	)
Accumulated other comprehensive loss		(177,183	)		(177,183	)

Total Stockholders' Deficit		(1,441,887	)		(1,381,936	)

Total Liabilities and Stockholders' Deficit	$	4,891		$	863

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

Kyto Biopharma, Inc. and Subsidiary

(A Development Stage Company)

Condensed Consolidated Statements of Operations

(Unaudited)

							For the period from
							March 5, 1999
	For The Three Months Ended						(inception) to
	June 30						June 30,
	2011			2010			2011


Operating Expenses
Depreciation and amortization	$	-		$	-		$	814,183
General and administrative		51,330			35,022			16,594,778

Total Operating Expenses	$	51,330		$	35,022		$	17,408,961

Loss from Operation	$	51,330		$	35,022		$	17,408,961

Other Income (Expenses)
Interest income		-			-			4,922
Interest expense		(16,513	)		-			(189,403	)
Loss on debt forgiveness		-			(43,689	)		(230,956	)
Loss on disposal of equipment		-			-			(567	)
Foreign currency transaction gain		-			56			249,039
Total Other Income (Expense), net		(16,513	)		(45,309	)		(166,965	)


Net Loss before taxes	$	(67,844	)	$	(80,331	)	$	(17,575,926	)

Net Income (Tax) Benefit	$	-		$	-		$	-

Net Loss	$	(67,844	)	$	(80,331	)	$	(17,575,926	)

Preferred Stock Dividends		(6,871	)		(6,539	)		(83,008	)

Net Loss Attributed to common shareholders	$	(74,715	)	$	(86,870	)	$	(17,658,934	)

Comprehensive Income (Loss)
Foreign currency translation gain (loss)		-			(56	)		(177,183	)


Total Comprehensive Loss	$	(74,715	)	$	(86,926	)	$	(17,836,117	)


Weighted average number of shares outstanding
during the year - basic and diluted		12,998,482			12,998,482


Net loss per share - basic and diluted	$	(0.01	)	$	(0.01	)
Net loss per share attributable to common share holders - basic and diluted	$	(0.01	)	$	(0.01	)

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

Kyto Biopharma, Inc. and Subsidiary

(A Development Stage Company)

Condensed Consolidated Statement of Stockholders' Deficit

For the Three Months Ended June 30, 2011

(Unaudited)

											Deficit			Accumulated
											Accumulated			Other
	Preferred Stock				Common Stock				Additional		During			Comprehensive
	$1.00 par value				$0.0001 par value				Paid - in		Development			Income
	Shares		Amount		Shares		Amount		Capital		Stage			(Loss)			Total

Balance, March 31, 2011		473,624	$	473,624		12,998,482	$	1,300	$	15,904,542	$	(17,584,219	)	$	(177,183	)	$	(1,381,936	)
Imputed Interest		-		-		-		-		14,764		-			-			14,764
Preferred Stock Dividends												(6,871	)
Net Loss, 2011		-		-		-		-		-		(67,844	)		-			(74,715	)
Balance, June 30, 2011		473,624	$	473,624		12,998,482	$	1,300	$	15,919,306	$	(17,658,934	)	$	(177,183	)	$	(1,441,887	)

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

Kyto Biopharma, Inc. and Subsidiary

(A Development Stage Company)

Condensed Consolidated Statements of Cash Flows

(unaudited)

								For the period from
								March 5, 1999
		For the Three Months Ended June 30						(Inception) to
		2011			2010			June 30, 2011
Cash Flows from Operating Activities:
Net loss		$	(67,844	)	$	(80,331	)	$	(17,575,926	)
Adjustment to reconcile net loss to net cash provided by (used in)
	operating activities:
	Depreciation and amortization		-			-			814,183
	Recognition of services rendered by consultant		-			-			10,227,893
	Stock based consulting expense		-			-			854,345
	Stock based director fees		-			-			314,100
	Stock based rent and administrative fees		-			-			167,028
	Interest Expense		14,764			-			103,817
	Preferred convertible stock issued for dividend on outstanding preferred convertible stock		-			-			13,890
	Common stock warrants issued as financing fee		-			-			3,783
	Loss on disposal of equipment		-			-			567
	Impairment loss		-			-			1,357,416
	Loans receivable from related party-written off		-			43,689			299,783
	Gain on settlement of accounts payable		-			-			(59,654	)
	Loss on settlement of accounts payable		-			-			519,795
	Amortization of stock based financing fee		-			-			25,010
Changes in operating assets and liabilities:
	Loan receivable		-			(43,689	)		(309,620	)
	Prepaids and other assets		-			-			(5,000	)
	Accounts payable and accrued expenses		(3,640	)		(4,785	)		542,659
	Related party accounts payable, accrued interest, and accrued liabilities		11,748			1,675			103,075
Net Cash Used in Operating Activities			(44,972	)		(83,441	)		(2,685,864	)

Cash Flows from Investing Activities:
Purchase of property and equipment			-			-			(4,463	)
Net Cash Used in Investing Activities			-			-			(4,463	)

Cash Flows from Financing Activities:
Proceeds from common stock issuance, net of
offering cost			-			-			958,222
Loan proceeds from related parties, net			49,000			81,500			1,973,971
Repayment of loan to related parties			-			-			(59,792	)
Net Cash Provided by Financing Activities			49,000			81,500			2,872,401

Effect of Exchange Rate on Cash			-			56			(177,183	)

Net Increase (decrease) in Cash and Cash Equivalents			4,028			(1,885	)		4,891

Cash and Cash Equivalents at Beginning of Period			863			4,444			-

Cash and Cash Equivalents at End of Period		$	4,891		$	2,559		$	4,891


Supplemental Disclosure of Cash Flow Information:
Cash paid for:
Interest		$	-		$	-		$	-
Taxes		$	-		$	-		$	-

Supplemental Disclosure of Non-Cash
Investing and Financing Activities:
Conversion of debt to equity		$	-		$	-		$	1,102,154
Stock issued for deferred consulting services		$	-		$	-		$	6,750,000
Conversion of liabilities to note payable		$	-		$	-		$	102,023
Stock issued for debt restructuring anti-dilusion provision		$	-		$	-		$	800,000
Conversion of preferred shares to common shares		$	-		$	-		$	250,000
Stock issued for future services		$	-		$	-		$	1,200,000
Issued common shares for intangible assets		$	-		$	-		$	2,160,570

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

KYTO BIOPHARMA, INC. AND SUBSIDIARY

(A Development Stage Company)

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2011

NOTE 1 – DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION

Kyto Biopharma, Inc. was formed as a Florida corporation on March 5, 1999. B Twelve, Limited, Kyto Biopharma, Inc.'s wholly-owned Canadian subsidiary (collectively referred to as the "Company"), was also formed on March 5, 1999. On August 14, 2002, the parent Company changed its name from B Twelve, Inc. to Kyto Biopharma, Inc.

The Company is a biopharmaceutical company, formed to acquire and develop innovative minimally toxic and non-immunosuppressive proprietary drugs for the treatment of cancer, arthritis, and other proliferate and autoimmune diseases. The Company has subsequently built itself into a development stage biopharmaceutical company that develops receptor-mediated technologies to control the uptake of vitamin B12 by non-controlled proliferative cells.

Activities during the development stage include acquisition of financing and intellectual properties and research and development activities conducted by others under contracts.

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules and regulations of the United States Securities and Exchange Commission for interim consolidated financial information. Accordingly, they do not include all the information and footnotes necessary for a comprehensive presentation of consolidated financial position and results of operations.

It is management's opinion, however, that all material adjustments (consisting of normal recurring adjustments) have been made, which are necessary for a fair consolidated financial statement presentation. The results for the interim period are not necessarily indicative of the results to be expected for the year.

For further information, refer to the audited consolidated financial statements and footnotes of the Company for the year ending March 31, 2011 included in the Company's Form 10-K.

The Company is exposed to foreign exchange rate fluctuations as the financial results of the company’s Canadian subsidiary are translated into U.S. dollars on consolidation. The functional currency of Kyto’s subsidiary is the Canadian dollar.

NOTE 2 – INTERIM REVIEW REPORTING

The accompanying unaudited condensed consolidated financial statements of Kyto Biopharma, Inc. (the "Company") have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the "SEC). 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 pursuant to such SEC rules and regulations. Nevertheless, the Company believes that the disclosures are adequate to make the information presented not misleading. These interim condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company's March 31, 2011 Annual Report as filed on Form 10K. In the opinion of management, all adjustments, including normal recurring adjustments necessary to present fairly the financial position of the Company with respect to the interim condensed consolidated financial statements and the results of its operations for the interim period ended June 30, 2011, have been included. The results of operations for interim periods are not necessarily indicative of the results for a full year.

KYTO BIOPHARMA, INC. AND SUBSIDIARY

(A Development Stage Company)

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2011

NOTE 3 – GOING CONCERN

As reflected in the accompanying unaudited condensed consolidated financial statements, the Company has a working capital deficiency of $1,441,887, a deficit accumulated during development stage of $17,658,934 and a stockholders' deficit of $ 1,441,887as of June 30, 2011. The ability of the Company to continue as a going concern is dependent on the Company's ability to further implement its business plan, raise capital, and generate revenues. The unaudited condensed consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

The Company has yet to generate an internal cash flow, and until the sales of its product begins, the Company is highly dependent upon debt and equity funding. The Company must successfully complete its research and development resulting in a saleable product. However, there is no assurance that once the development of the product is completed and finally gains Federal Drug and Administration clearance, that the Company will achieve a profitable level of operations.

NOTE 4 - ACCOUNTING STANDARDS UPDATES

Significant Recent Accounting Pronouncements

Management does not believe that any recently issued, but not yet effective, accounting standards if currently adopted would have a material effect on the accompanying unaudited condensed consolidated financial statements.

NOTE 5- PATENT RIGHTS

On February 10, 2010, the Company purchased a portfolio of patents, patents pending, and related intellectual property (collectively the "Intellectual Property") from a third party in exchange for 254,872 shares of the Company's common stock and cash of $5,000 which was paid during the quarter ending June 30, 2010. The shares were valued at $0.63 per share resulting in total value of $165,570.

Kyto executed an “Executive Licensing Agreement” with The Research Foundation of State University of New York, “RFSUNY”, allowing Kyto to license certain technology surrounding the Human Transcobalamin Receptor. The licensing agreement is active until the expiry of the patent rights.. The rights primarily relate to the patent: “Transcobalamin Receptor Polypeptides, Nucleic Acids, and Modulators Thereof, and Related Methods of Use in Modulating Cell Growth and Treating Cancer and Cobalamin Deficiency”. The Patents were valued for $165,570.

Patent rights are stated at cost and will be reclassified to intangible assets and amortized on a straight-line basis over the estimated future periods to be benefited twenty years) if and once the patent has been granted by the patent office.

The Patents were deemed to have been impaired during the year ended March 31, 2011. The company does not have patents portfolio as on June 30, 2011.

KYTO BIOPHARMA, INC. AND SUBSIDIARY

(A Development Stage Company)

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2011

NOTE 6 –RELATED PARTY TRANSACTIONS

A) LOAN PAYABLE - CFCC

In June 30, 2011, the company owed $1,115,096 to a related party director of the Company. During the three months ended June 30, 2011, the Company borrowed $49,000 from a related party of the Company. The loan is non-interest bearing, unsecured, due on demand, does not follow any specific repayment terms and included in the loans payable- related party balance. As per ASC-835-30 “Imputation of Interest”, interest has been imputed @ 5%p.a. quarterly cumulative and $14,764 has been imputed and accrued as interest.

B) LOAN RECEIVABLE FROM RELATED PARTY (TPT)

In June 2009, two of the founders of the Company entered into a Standstill Agreement with the Clayton Foundation to license and commercialize from the Clayton Foundation for Research a portfolio of product candidates based on proprietary technology in part developed at the MD Anderson Cancer Center by Dr Michael Rosenblum, a former director of Kyto Biopharma Inc.

The services of two biotechnology specialized investment banks were secured in order to prepare a business plan, a valuation of the licenses and raise the funds necessary for the clinical development of targeted anticancer therapeutic proteins.

Through a new entity, Targeted Payload Therapeutics (TPT), funds advanced by a related party were advanced to TPT for the payment of the “Standstill Agreement”, fees related to the services of the 2 investment banks and expenses related to the transaction. The shareholders of TPT upon closing were: Kyto Biopharma Inc., Dr. Sagman, a director and one of the founders of the Company, the Clayton Foundation and scientists instrumental in bringing the transaction and continuing the development of the pipeline of products.

During the year ended March 31, 2010, Kyto loaned $265,931 to a newly founded US based biotechnology company, TPT. Amounts loaned under this note was non- interest bearing, unsecured, due on demand and do not follow any specific repayment terms.TPT was created to commercialize licensed technology which was developed at leading medical centers of excellence in the USA. Two of the founders of Kyto, Mr. Georges Benarroch and Dr. Uri Sagman, are also the founders of TPT. Kyto also loaned additional $43,689 during the quarter ending June 30, 2010.

On May 7, 2010 the Company announced the cancellation of its agreement with Targeted Payload Therapeutics Inc. ("TPT") and pursue any activities under Standstill Agreement. For the years ended March 31, 2011 and 2010, the Company had written off an impaired loan of $43,689 and $265,931, respectively, towards loss incurred as a consequence of cancellation of agreement with TPT.

C) ACCRUED LIBILITIES

The Company leases office space and administrative services from a related party principal stockholder and is included in general and administrative expense in the accompanying consolidated statements of operations. The Company allocates 50% of these amounts to rent expense. As of June 30, 2011, the remaining balance in the accrued liabilities-related party account for the above services was $39,000.

D) NOTES PAYABLE

During the year ended March 31, 2001, the Company entered into an agreement with a vendor, who is also a principal stockholder, for services totalling $200,000. On November 11, 2002, the Company and vendor mutually agreed that in lieu of the $200,000 payment, the vendor would accept 100,000 shares of the Company's common stock valued at $1.00 totalling $100,000. In addition, the Company also executed a $100,000 unsecured promissory note with the vendor. Under the terms of the promissory note, the obligation bears interest at prime plus 1% (4.25% at June 30, 2011). Interest is accrued and payable quarterly.

At June 30, 2011 and March 31, 2011, accrued interest totalled $67,887 and $66,139 respectively.

KYTO BIOPHARMA, INC. AND SUBSIDIARY

(A Development Stage Company)

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2011

NOTE 7- EQUITY

A) CONVERTIBLE PREFERRED STOCK

On May 24, 2007 the Company entered into an agreement with Credifinance Capital Corp, a related party, to issue up to 500,000 Convertible Preferred Stock at $1.00 per share. This agreement is on an installment basis. During the year ended March 31, 2008, the Company issued 473,624 shares of Convertible Preferred Stock to Credifinance Capital Corp. for a total of $473,624 to satisfy a related party loan payable. Convertible Preferred Stock may be converted into Common Shares at a price of $0.45 per Common Share. The Convertible Preferred Stock bears dividend at a rate of 5% per annum. Preferred Convertible Stock has the same voting rights as Common Stock. Dividend accrued on the Convertible Preferred Stock through June 30, 2011 was $83,008. As of June 30, 2011, 473,624 convertible preferred shares were outstanding.

B) COMMON STOCK

In January 2006, the Company issued 94,054 shares valued at $0.75 per share based on the quoted trade price in payment of various expenses totaling $47,027 to a finance company controlled by a director of the company and to a director. The Company recorded a loss on debt conversion of $23,513. In February 2008, the company issued 500,000 shares valued at $0.50 per share in payment of consulting service to Dr. Uri Sagman, 159,999 shares valued at $0.50 per share to Credifinance Capital Corp. for rent and administration fees, and 3,408 shares valued at $0.50 per share to Credifinance Capital Corp. for satisfaction of the balance of the related party loan payable.

In March 2010, the Company issued 254,872 shares valued at $0.63 per share, in exchange for Patent rights.

As of June 30, 2011, 12,998,482 common shares were outstanding.

NOTE 8 - SUBSEQUENT EVENTS

Management evaluated all activities of the Company through the issuance date of the Company’s Unaudited Condensed Consolidated financial statements and concluded that no subsequent events have occurred that would require adjustments or disclosures into the unaudited condensed consolidated financial statements.

ITEM 2.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS

PLAN OF OPERATION

During the year ending March 31, 2011, the Company has continued to conduct a comprehensive review of its existing Intellectual Property portfolio with the assistance various IP legal firms and consultants. As a result of this review, the Company has elected to drop some of its patents while funding the remaining patents in full.

The efforts of the Company’s R&D have produced notable accomplishments with respect to the development of a novel cancer therapy through the regulation of Vitamin B12 uptake, an essential nutrient for cells. For the first time, the Company has conclusively identified the protein and the gene encoding the Vitamin B12 receptor. The work which is currently done by SUNY on utilizing the Vitamin B12 pathway provides for several strategies aimed at preventing the proliferation of cancer cells.

The company is pleased to announce that on June 29, 2010, the Canadian Patent Office issued the Patents for Canadian Patent Application No, 2187346, in the name of Receptor Modulating Agents and Methods Relating Thereto. The patentees are The University of Washington and Kyto Biopharma, Inc. The application was filed on April 7, 1995 and will remain in force for a period of 20 years from the filing date.

The report of our Independent Registered Public Accounting firm dated June 29, 2011 on our March 31, 2011 consolidated financial statements includes an explanatory paragraph indicating that there is substantial doubt about our ability to continue as a going concern due to substantial recurring losses from operations, cash used in operations, stockholders’ deficit and significant accumulated deficit and working capital deficit. Our ability to continue as a going concern will be determined by our ability to obtain additional financing and maintain operations. We do not currently have sufficient financial resources to fund our operations. Therefore, we need additional funds to continue these operations. The Company operates in a rapidly changing environment that involves a number of factors, some of which are beyond management’s control, such as financial market trends and investors’ appetite for new financings. It should be emphasized that, should the Company not be successful in completing its own financing (either by debt or by the issuance of securities from treasury), the Company may be unable to continue to operate as a going concern.

In discussions with various collaborative partners, the Company has decided to pursue a specific antibody strategy with the assistance of RFSUNY and an outsourced third party vendor. The development of this antibody technology will be overseen by RFSUNY and is currently in the early stages of development. The Company does not yet have an estimate of the total costs associated with this development. As the Company has no current revenues from operations, management fully expects to incur additional liabilities in order to fund the development of this strategy over the next 9 months.

On February 10, 2010 Kyto executed an “Executive Licensing Agreement” with The Research Foundation of State University of New York, “RFSUNY”, allowing Kyto to license certain technology surrounding the Human Transcobalamin Receptor. The licensing agreement is active until the expiry of the patent rights. The rights primarily relate to the patent: “Transcobalamin Receptor Polypeptides, Nucleic Acids, and Modulators Thereof, and Related Methods of Use in Modulating Cell Growth and Treating Cancer and Cobalamin Deficiency”.

Results of Operations

For the three ended June 30, 2011 the Company’s net loss decreased by $12,487 to $67,844 compared to a net loss of $80,331 for the three months ended June 30, 2010. The comprehensive loss for the three months ended June 30, 2011 the Company’s net loss decreased by $12,155 to $74,715 compared to a net loss of $86,870 for the three months ended June 30, 2010

Liquidity and Capital Resources

The Company had working capital deficits of $1,441,887 as of June 30, 2011 and $1,381,936 as of March 31, 2011. Cash was $4,891 as of June 30, 2011 and $863 as of March 31, 2011.

Cash from operating activities

The Company’s cash used in operations decreased $38,469 to $44,972 for the three months ended June 30, 2011 compared to cash used in operations of $83,441 for the three months ended June 30, 2010

Cash from financing activities

The Company’s net cash flows from financing activities decreased $32,500 to $49,000 as of June 30, 2011 compared to cash flows from financing activities of $81,500 for the three months ended June 30, 2010.

The Company’s plan of operation for the next twelve months is to continue to focus its efforts on finding new sources of capital and on R&D activities related to the development and application of its antibody technologies. As of the date of filing of this Form 10-Q with the U.S. Securities and Exchange Commission, the Company did receive a commitment of one of its stockholders to continue to provide operating loan funds to the Company.

ITEM 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not required for smaller reporting company.

ITEM 4.

CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that material information required to be disclosed in our periodic reports filed under the Securities Exchange Act of 1934, as amended, or 1934 Act, is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms and to ensure that such information is accumulated and communicated to our management, including our chief executive officer/chief financial officer (principal financial officer) as appropriate, to allow timely decisions regarding required disclosure. During the quarter ended June 30, 2011 we carried out an evaluation, under the supervision and with the participation of our management, including the principal executive officer and the principal financial officer (principal financial officer), of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rule 13(a)-15(e) under the 1934 Act. Based on this evaluation, because of the Company’s limited resources and limited number of employees, management concluded that our disclosure controls and procedures were ineffective as of June 30, 2011.

Limitations on Effectiveness of Controls and Procedures

Our management, including our Chief Executive Officer and Chief Financial Officer (principal financial officer), does not expect that our disclosure controls and procedures or our internal controls will prevent all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected. These inherent limitations include, but are not limited to, the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the control. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Over time, controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

Internal Controls over Financial Reporting

During the quarter ended June 30, 2011, there have been no changes in our internal control over financial reporting that have materially affected or are reasonably likely to materially affect our internal controls over financial reporting.

PART II. OTHER INFORMATION

ITEM 1.

LEGAL PROCEEDINGS

None

ITEM 1A.

RISK FACTORS.

Not required for smaller reporting company.

ITEM 2.

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS .

None

ITEM 3.

DEFAULTS UPON SENIOR SECURITIES

None

ITEM 4.

REMOVED AND RESERVED

None

ITEM 5.

OTHER INFORMATION

None.

ITEM 6.

EXHIBITS

Index to Exhibits on page 15

INDEX TO EXHIBITS

EXHIBIT NUMBER		DESCRIPTION

3(i)(a)		Articles of Incorporation of Kyto Biopharma, Inc.*

3(i)(b)		Articles of Amendment changing name to Kyto Biopharma, Inc.*

3(ii)		Bylaws of Kyto Biopharma, Inc.*

10.1		Research collaboration agreement between The Research Foundation of State University of New York and B. Twelve Ltd. (Kyto Biopharma, Inc.) [dated August 19, 1999]**

10.2		Collaborative Research Agreement to synthesize new vitamin B12 analogs signed between the Company and New York University [dated November 11, 1999]**

10.3		Extension/Modification Research Collaboration Agreement between the Research Foundation of State University of New York and B Twelve, Inc., (Kyto Biopharma, Inc.) Modification No. 1 [dated November 01, 2000]**

10.4		Debt Settlement Agreement and Put Option (dated November 2002) between Kyto Biopharma, Inc. and New York University.**

10.5		Extension/Modification Research Collaboration Agreement between the Research Foundation of State University of New York and Kyto Biopharma, Inc., Modification No. 2 [dated December 2004]. **

10.6		Services Agreement between Kyto Biopharma, Inc. and Gerard Serfati [dated November 1, 2004]***

31.1		Section 302 Certification of principal executive officer.**

31.2		Section 302 Certification of principal financial and accounting officer.**

32.1		Certification pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 **

———————

*	Filed as Exhibit to Company's Form 10-SB on September 12th, 2003, with the Securities and Exchange Commission
**	Filed as Exhibit with this Form 10-Q.

***	Previously filed with Form S-8 on November 18, 2004.

SIGNATURES

In accordance with 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.

	Kyto Biopharma, Inc.
	(Registrant)

Date: August 15, 2011	By:	/s/ Georges Benarroch
		Georges Benarroch
		President and Chief Executive Officer

Kyto Technology & Life Science, Inc. - FORM 10-Q - August 15, 2011

Attached files

Kyto Technology & Life Science, Inc. Reports