UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

[X]

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

For the Quarterly Period Ended: ~~December~~March 31, ~~2017~~2018

[ ]

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

For the Transition Period from ____________ to ____________

Commission file number: 000-54004

AVANT DIAGNOSTICS, INC.

(Exact name of registrant as specified in its charter)

Nevada

82-4751804

(State or other Jurisdiction of

Incorporation or Organization)

(I.R.S. Employer

Identification No.)

1050 30^th Street NW Suite 107

Washington DC

20007

(Address of Principal Executive Offices)

(Zip Code)

(708) 710-9200

(Registrant’s telephone number, including area code)

(Former name or former address, 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. Yes [ ] No [X]

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 (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes [ ] No [X]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	[ ]	Accelerated filer	[ ]
Non-accelerated filer	[ ]	Smaller reporting company	[X]
(Do not check if a smaller reporting company)

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

The number of outstanding shares of the Registrant’s common stock, par value $0.00001 per share, at ~~November~~December 1512, 2018 was 336,957,722.

AVANT DIAGNOSTICS, INC.

FORM 10-Q

~~December~~March 31, ~~2017~~2018

TABLE OF CONTENTS

		Page
PART I. FINANCIAL INFORMATION
ITEM 1.	Financial Statements	4
	Condensed consolidated balance sheets as of December 31, 2017 (unaudited) and December 31, 2016	4
	Condensed consolidated balance sheets as of March 31, 2018 (unaudited) and September 30, 2017	4
	Condensed consolidated statements of operations and comprehensive loss for the three and three months ended December 31, 2016 and 2017 (unaudited)	5
	Condensed consolidated statements of operations and comprehensive loss for the three and six months ended March 31, 2018 and 2017 (unaudited)	5
	Condensed consolidated statement of changes in stockholders’ equity for the three months ended December 31, 2017 (unaudited)	6
	Condensed consolidated statement of changes in stockholders’ equity for the six months ended March 31, 2018 (unaudited)	6
	Condensed consolidated statements of cash flows for the three months ended December 31, 2016 and 2017 (unaudited)	7
	Condensed consolidated statements of cash flows for the six months ended March 31, 2018 and 2017 (unaudited)	7
	Notes to condensed consolidated financial statements (unaudited)	8
ITEM 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	2625
ITEM 3.	Quantitative and Qualitative Disclosures about Market Risk	3029
ITEM 4.	Controls and Procedures	3029
PART II. OTHER INFORMATION
ITEM 1.	Legal Proceedings	3130
ITEM 1A.	Risk Factors	3332
ITEM 2.	Unregistered Sales of Equity Securities and Use of Proceeds	3332
ITEM 3.	Defaults Upon Senior Securities	3332
ITEM 4.	Mine Safety Disclosures	3332
ITEM 5.	Other Information	3332
ITEM 6.	Exhibits	33
SIGNATURES		34

-2-

FORWARD-LOOKING STATEMENTS

Statements in this quarterly report may be “forward-looking statements.” Forward-looking statements include, but are not limited to, statements that express our intentions, beliefs, expectations, strategies, predictions or any other statements relating to our future activities or other future events or conditions. These statements are based on current expectations, estimates and projections about our business based, in part, on assumptions made by management. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may, and are likely to, differ materially from what is expressed or forecasted in the forward-looking statements due to numerous factors, including those described above and those risks discussed from time to time in this prospectus, including the risks described under “Risk Factors,” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” as discussed in our Annual Report on Form 10-K for the fiscal year ended September 30, 2017 and in other documents which we file with the Securities and Exchange Commission. In addition, such statements could be affected by risks and uncertainties related to our ability to raise any financing which we may require for our operations, competition, government regulations and requirements, pricing and development difficulties, our ability to make acquisitions and successfully integrate those acquisitions with our business, as well as general industry and market conditions and growth rates, and general economic conditions. Any forward-looking statements speak only as of the date on which they are made, and we do not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date of the filing of this annual report, except as may be required under applicable securities laws.

This Management’s Discussion and Analysis of Financial Condition and Results of Operations includes a number of forward-looking statements that reflect Management’s current views with respect to future events and financial performance. Forward-looking statements are projections in respect of future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as “may”, “should”, “expects”, “plans”, “anticipates”, “believes”, “estimates”, “predicts”, “potential” or “continue” or the negative of these terms or other comparable terminology. Those statements include statements regarding the intent, belief or current expectations of us and members of our management team as well as the assumptions on which such statements are based. Prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risk and uncertainties, and that actual results may differ materially from those contemplated by such forward-looking statements. Forward-looking statements made in this quarterly report on Form 10-Q includes statements about:

●	our ability to maintain pricing;
●	the cyclical nature of the health care industry;
●	deterioration of the credit markets;
●	delays in obtaining required regulatory approvals;
●	our ability to raise additional capital to fund future capital expenditures;
●	increased vulnerability to adverse economic conditions due to indebtedness;
●	competition within the health care industry;
●	asset impairment and other charges;
●	our limited operating history on which investors will evaluate our business and prospects;
●	our ability to obtain raw materials and specialized equipment;
●	technological developments or enhancements;
●	loss of key executives;
●	management control over stockholder voting;
●	the ability to employ skilled and qualified workers;
●	work stoppages and other labor matters;
●	hazards inherent to the health care industry;
●	inadequacy of insurance coverage for certain losses or liabilities;
●	regulations affecting the health care industry;
●	federal legislation and state legislative and regulatory initiatives relating to health care;
●	costs and liabilities associated with environmental, health and safety laws, including any changes in the interpretation or enforcement thereof;
●	future legislative and regulatory developments;
●	our beliefs regarding the future of our competitors;
●	our expectation that the demand for our products will eventually increase; and
●	our expectation that we will be able to raise capital when we need it.

-3-

PART I – FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

AVANT DIAGNOSTICS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

	December 31, 2017			September 30, 2017
Balance Sheet
	March 31, 2018			September 30, 2017
	(Unaudited)
ASSETS
Current Assets:
Cash		5067,~~967~~644		$	1,348
Accounts receivable		-			-
Prepaid expenses		-			-
Total current assets		5067,~~967~~644			1,348
Non-current Assets
Intellectual Property		4,~~969~~860,~~520~~981			5,078,060
Website development cost, net		3,~~984~~719			4,250
Other Assets		~~26,560~~-			46,560
Patent costs, net		9592,~~894~~801			98,987
Total non-current assets		54,~~095~~957,~~958~~500			5,227,857
Total Assets		5,~~146~~025,~~926~~144		$	5,229,205
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities:
Accounts payable		1,~~207~~239,~~544~~741		$	1,106,607
Accrued expenses		~~619~~585,~~086~~389			542,340
Accrued payroll and benefits		~~294~~233,~~937~~137			277,175
Convertible notes payable		-			-
Convertible notes payable to related party		~~400,000~~-			400,000
Derivative liability		1,857,~~180~~355			1,926,800
Total current liabilities		4,378,747			4,252,921
Other Liabilities		287,500			-
Total Liabilities		4,378,747			4,252,921
Total current liabilities		4,203,121			4,252,922
Total Liabilities		4,203,121			4,252,922
Commitments and Contingencies
Stockholders’ Equity
Preferred stock, $0.001 par value; 50,000,000 shares authorized
Series B preferred stock $0.001 par value; 3,000 and -0- shares outstanding as of December 31, 2017 and September 30, 2017 respectively		-			-
Series B preferred stock $0.001 par value; 3,000 and -0- shares outstanding as of March 31, 2018 and September 30, 2017 respectively		-			-
Common Stock ($0.00001 par value), 450,000,000 shares authorized; 306,865,649 and 303,927,098 shares outstanding as of December 31, 2017 and September 30, 2017, respectively		3,069			3,040
Common Stock ($0.00001 par value), 450,000,000 shares authorized; 336,957,722 and 303,927,098 shares outstanding as of March 31, 2018 and September 30, 2017, respectively		3,370			3,040
Additional paid-in capital		32,~~191~~564,~~436~~575			32,132,294
Accumulated deficit		(31,~~426~~745,~~327~~922	)		(31,159,051	)
Total Stockholders’ Equity		~~768~~822,~~179~~023			976,283
Total Liabilities and Stockholders’ Equity		5,~~146~~025,~~926~~144		$	5,229,~~205~~206

See accompanying notes which are an integral part of these condensed consolidated financial statements.

-4-

AVANT DIAGNOSTICS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(unaudited)

	For the three months ended December 31
	For the three months ended March 31						For the six months ended March 31,
	2017			2016
	2018			2017			2018			2017
Revenue		-		$	~~242~~13,~~021~~930			-			255,951
Cost of revenue		-			221,~~963~~824			-			24,787
Gross profit		-			~~219~~12,~~058~~106			-			231,164
Operating expenses:
Selling, general and administrative		~~247~~237,~~832~~417			~~443~~554,~~290~~891			485,249			998,181
Amortization Fees		-			-			-			-
Research and development		-			-			-
Research and development - license acquired		-			-			-
Professional fees		~~112~~126,~~804~~821			491,~~806,763~~397			239,625			4,898,160
Merger costs		-			-			-			-
Total operating expenses		~~360~~364,~~635~~238			5646,~~250,053~~288			724,874			5,896,341
Loss from operations		(~~360~~364,~~635~~238	)		(5634,~~030,994~~183	)		(724,874	)		(5,665,177	)
Other income
Interest income		-			-			-			-
Gain on other comprehensive income		~~37,478~~-			-			37,478			-
Total other expense		~~37,478~~-			-			37,478			-
Other expense
Interest expense		33(44,~~738~~817	)		~~372~~143,~~928~~645			(11,080	)		516,573
Loss on change in fair value of derivative		~~(89,620~~175	)		~~689~~(429,~~047~~637	)		(89,445	)		259,410
Total other expense		(5544,~~882~~643	)		1(285,~~061,975~~992	)		(100,525	)		775,983
Net Loss		(~~267~~319,~~276~~596	)	$	(6348,~~092,969~~191	)		(586,871	)		(6,441,160	)
Loss per Share:
Basic and diluted net loss per common share outstanding		(0.00	)	$	(0.0400	)		(0.00	)		(0.04	)
Basic and diluted weighted average number of common shares outstanding		200,~~361~~765,~~619~~128			~~162~~176,~~466~~007,~~478~~933			200,723,906			175,944,679
Comprehensive loss:
Net loss		(~~267~~319,~~276~~596	)	$	(6348,~~092,969~~191	)		(586,871	)		(6,441,160	)
Unrealized loss on available for sale securities		-			-			-			-
Comprehensive loss		(~~267~~319,~~276~~596	)	$	(6348,~~092,969~~191	)		(586,871	)		(6,441,160	)

See accompanying notes which are an integral part of these condensed consolidated financial statements.

-5-

AVANT DIAGNOSTICS, INC.

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY

~~THREE~~SIX MONTHS ENDED ~~DECEMBER~~MARCH 31, ~~2017~~2018

(unaudited)

	Preferred stock				Common Stock				Additional Paid-in		Accumulated			Total Stockholders’
	Shares		Amount		Shares		Amount		Capital		Deficit			Equity
Balances at September 30, 2017		-	$	-		303,927,098	$	3,040	$	32,132,294	$	(31,159,051	)	$	976,283
Sale of common stock		-		-		-		-		-		-			-
Sale of Preferred Stock		-		-		-		-		-		-			-
Common stock issued for services		-		-		2,938,551		29		59,142		-			59,171
Stock based compensation		-		-		-		-		-		-			-
Common stock issued to pay debt to officer		-		-		-		-		-					-
Common stock issued to pay debt		-		-		30,092,073		301		373,139		-			373,440
Adjustment related to prior period		-		-		-		-		-		-			-
Reclass derivative liability to equity upon note payments		-		-		-		-		-		-			-
Net loss		-		-		-		-		-		(~~267~~586,~~276~~871	)		(~~267~~586,~~276~~871	)
Balances at December 31, 2017		-	$	-		306,865,649	$	3,069	$	32,191,436	$	(31,426,327	)	$	768,179
Balances at March 31, 2018		-	$	-		336,957,722	$	3,370	$	32,564,575	$	(31,745,922	)	$	822,023

See accompanying notes which are an integral part of these condensed consolidated financial statements.

-6-

AVANT DIAGNOSTICS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited)

	For the three months ended
	For the six months ended
	December 31,
	March 31,
	2017			2016
	2018			2017
Cash Flows from Operating Activities:
Net loss	$	(~~267~~586,~~276~~871	)	$	(6,~~092~~441,~~969~~160	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		~~111~~223,~~899~~796			~~111~~223,~~898~~840
Amortization of debt discounts		-			~~(4,426~~-	)
Amortization of patent and web design costs
Research and development - license acquired		-			-
Stock-based compensation expenses		59,~~171~~472			4,~~660~~758,~~599~~150
Loss on change in fair value of derivatives		(69,~~620~~445	)		1,~~854~~491,~~742~~159
Changes in operating assets and liabilities:
Accounts receivable		-			~~(130~~5,~~891~~068	)
Prepaid Expenses		-			~~4,096~~-
Accounts payable		~~100~~133,~~937~~135			-328,024
Accrued payroll and benefits		-			-
Due to related party		17,762			75,880
Other Liabilities		287,500			-
Accrued liabilities		76,746			22,270
Due to related party		(44,038	)		41,410
Net cash used in operating activities		29,619			501,199
Accrued liabilities		43,049			44,952
Net cash used in operating activities		46,597			451,443
Cash Flows from Investing Activities:
Cash acquired with acquisition of Theranostics Health, Inc. assets		-			-
Licensing costs		-			(15,~~127~~126	)
Other Assets		2046,~~000~~560			(227,521	)
Website development costs		-			-
Net cash provided by (used in) investing activities		2046,~~000~~560			(242,~~648~~647	)
Cash Flows from Financing Activities:
Proceeds from sale of common stock, net		-373,139			1
Proceeds from convertible notes payable		-			(~~185~~200,~~661~~087	)
Proceeds from convertible notes payable, related party		-(400,000	)		-
Net cash provided by financing activities		-(26,861	)		(~~185~~200,~~660~~086	)
Net increase in cash		4966,~~619~~296			728,~~892~~709
Cash at beginning of period		1,348			851
Cash at end of period	$	5067,~~967~~644		$	739,~~743~~560
Supplemental disclosure of noncash investing and financing activities:
Net liabilities assumed in connection with recapitalization	$	-		$	-
Effect of recapitalization	$	-		$	-
Shares issued in settlement of related party debt	$	-		$	-
Reclass derivative liability to equity upon note payment	$	-		$	-

See accompanying notes which are an integral part of these condensed consolidated financial statements.

-7-

AVANT DIAGNOSTICS, INC. ~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2017~~

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2018

(UNAUDITED)

NOTE 1 – NATURE OF OPERATIONS AND BASIS OF PRESENTATION

Avant Diagnostics, Inc. (“Avant”, “we” or the “Company”) was incorporated on October 16, 2008 in the State of Nevada as “Oreon Rental Corporation”. At the time of its incorporation, the management of the Company intended to operate electronics rental stores in Ternopil and other similar cities throughout Ukraine. However, at the time of its incorporation and its initial public offering of common stock in October 2008, the Company did not own any such stores, nor did it have any ongoing business operations. The Company underwent a change in management in January 2010. Following the change in management, the Company decided not to proceed with its original plan of operations and to shift its business focus to that of an independent oil and gas company engaged in the acquisition, drilling and production of oil and natural gas properties and prospects. During 2014, the Company wound down its oil and natural gas operations and decided to complete a reverse recapitalization with Avant Diagnostics, Inc., a Nevada Corporation established in 2009.

The Company is a commercial-stage molecular data-generating company that focuses on the development and commercialization of a series of proprietary data-generating assays that provide important actionable information for physicians and patients in the areas of oncology. Avant was originally named Arrayit Diagnostics, Inc. which was formed as a majority owned subsidiary of Arrayit Corporation (“Arrayit”) through a technology transfer in July 2009. In January 2013, the Company effected a name change to Avant Diagnostics, Inc.

Acquisition of Avant Diagnostics, Inc.

Effective December 29, 2014, the Company completed a reverse recapitalization, as agreed in the definitive Agreement and Plan of Reorganization, of 100% of the outstanding equity interests of American Liberty Petroleum Corp. (“ALP”). Avant stockholders received 74,354,139 shares of common stock for a 93% equity interest in ALP. Such share exchange was calculated based on a one-for-one conversion ratio after a 1 for 17 reverse stock split of ALP which was subsequently effected in March 2015. The split affected the ALP common stock and not the Avant common stock. All references in the accompanying consolidated financial statements to the number of shares, options and other common stock equivalents, price per share and weighted-average number of shares outstanding of common stock have been adjusted to retroactively reflect the effect of the reverse stock split. Per the terms of the Agreement and Plan of Reorganization, ALP was delivered with zero assets and $70,000 in liabilities at time of closing. Following the reverse merger, we changed the name of ALP to “Avant Diagnostics, Inc.” The transaction was regarded as a reverse recapitalization whereby Avant was considered to be the accounting acquirer as it retained control of ALP after the exchange. Although ALP is the legal parent company, the share exchange was treated as a recapitalization of ALP. Avant is the continuing entity for financial reporting purposes. Accordingly, the assets and liabilities and the historical operations reflected in the financial statements are those of Avant for all periods presented.

As of ~~December~~March 31, ~~2017~~2018, there remained a total of 3,510,000 shares of common stock that still had not been converted by Avant stockholders as part of the reverse recapitalization. The Agreement and Plan of Reorganization does not provide for cash in lieu of exchange of shares and provides that upon the merger, the stockholders acquired their rights in ALP shares and all outstanding shares of Avant were deemed to be cancelled. There is no timeframe as to when the stockholders must convert their shares and, as of the date of this report, the shares have not been issued.

-8-

Recent Developments

During the fiscal year ended September 30, 2017, the Company curtailed its operations as a result of its limited operating capital. Since the end of the fiscal year ended September 30, 2017 through September 30, 2018, we have focused on executing our business plan by commercializing our proprietary data-generating technology in the area of oncology, as well as focusing on the relocation and opening of a revenue producing CAP/CLIA laboratory. The Company is focused on improving revenues in the pharma services business by acquiring customers with oncology-focused preclinical and clinical drug development programs. The Company is establishing business relationships with pharmaceutical companies in early and late stage clinical development.

In connection with the purchase of the business assets and certain liabilities of Theranostics Health, Inc. (“THI”) ~~the~~, the Company acquired a CLIA laboratory located in Gaithersburg, Maryland. THI is a leading developer of proteomic technologies ~~for~~ for measuring the activation status of key signaling pathways that are instrumental in the development of companion diagnostics ~~for~~ for molecular-targeted therapies. THI has used these proteomic technologies to support the drug development programs of most major pharmaceutical and biotechnology drug development companies. THI is also providing these testing capabilities to clinical oncologists to advance personalized medicine through its TheraLink® data-generating assays.

As a result of the cost cutting measures taken during the fiscal year ended September 30, 2017, the Company substantially curtailed the use of the CLIA laboratory. As a result of these cost cutting measures, the Company was unable to timely make certain payments on the terms of the lease. As a result, the Company defaulted on its lease at the location of the Maryland laboratory and the landlord held the equipment located in the facility as collateral for amounts owed under the lease. AVDX Investors Group, LLC (“AVDX”), an entity controlled by Jeff Busch, our Executive Chairman (“Busch”), loaned the Company the capital to purchase the equipment. The note issued to AVDX is a demand promissory note that bears no interest and is secured by the equipment. During the fiscal year ended September 30, 2018, AVDX, Busch and his affiliated entities also loaned and/or paid certain ~~obligation~~obligations amounts on behalf of the Company.

Once the Company reacquired the equipment for the laboratory, management undertook a review of the Company’s current operations and decided to move the CLIA laboratory from Maryland to Golden, Colorado (the “New Lab”) In connection with the relocation to the New Lab, the Company executed a lease, built out the space for the New Lab and moved the equipment from Maryland to Colorado. In connection with this relocation, management, in consultation with scientists from George Mason University, the licensor of the Company’s Theralink® technology (“Licensor”), evaluated the status of the Company’s equipment. It was determined that the equipment was not properly maintained and was left in poor working order. As a result, the Company had to spend approximately $152,~~376~~209 during the fiscal year ended September 30, 2018 to have the equipment fixed for the New Lab , so the Licensor could assist management with the set up and validation of the equipment to be used for the technology. The Company ~~continues~~ continues to build out the lab and plans to have it operational during the fiscal year ended September 30, 2019.

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information. Accordingly, they do not include all of the information and disclosures required by U.S. GAAP for annual financial statements. In the opinion of management, such statements include all adjustments (consisting only of normal recurring items) which are considered necessary for a fair presentation of the condensed consolidated financial statements of the Company as of ~~December~~March 31, ~~2017~~2018 and the condensed consolidated results of its operations and cash flows for the ~~three~~six months ended ~~December~~March 31, ~~2017~~2018. The results of operations for the six ~~three~~ months ended ~~December~~March 31, ~~2017~~2018 are not necessarily indicative of the operating results for the full year ending September 30, 2018, or any other period. These interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and related disclosures of the Company as of September 30, 2017 and for the year then ended, which was filed with the Securities and Exchange Commission on Form 10-K on December 5, 2018.

-9-

NOTE 2 – GOING CONCERN AND MANAGEMENT’S LIQUIDITY PLANS

Since inception, the Company has financed its operations primarily through equity and debt financings and advances from related parties. As of ~~December~~March 31, ~~2017~~2018, the Company had an accumulated deficit of $31.4375 million. During the ~~three~~six months ended ~~December~~March 31, ~~2017~~ ~~and~~2018 ~~2016~~and 2017, the Company incurred net losses of $~~267~~586,~~276~~871 and $6.44 million,~~092,969~~ respectively, and ~~cash~~ used cash in operating activities of $2946,~~619~~ 597 and $~~501~~451,~~199~~443, respectively. These conditions raise substantial doubt about the Company’s ability to continue as a going concern.

The Company recognizes it will need to raise additional capital in order to fund operations, ~~meet~~met its payment obligations and execute its business plan. There is no assurance that additional financing will be available when needed or that management will be able to obtain financing on terms acceptable to the Company and whether the Company will generate revenues, become profitable and generate positive operating cash flow.

If the Company is unable to raise sufficient additional funds on favorable terms, it will have to develop and implement a plan to further extend payables and to raise capital through the issuance of debt or equity on less favorable terms until sufficient additional capital is raised to support further operations. There can be no assurance that such a plan will be successful. If the Company is unable to obtain financing on a timely basis, the Company could be forced to sell its assets, discontinue its operations and/or pursue other strategic avenues to commercialize its technology, and its intellectual property could be impaired.

NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation

The condensed consolidated financial statements include the accounts of the Company and AVDX. All intercompany transactions and balances have been eliminated in consolidation.

Use of Estimates

The preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of expenses during the reporting period. The Company’s significant estimates include the valuation of derivative liabilities, useful lives of long-lived assets, the valuation of debt and equity instruments, the valuation allowance relating to stock-based compensation and the Company’s deferred tax assets. Actual results could differ from those estimates.

Revenue Recognition

For revenue from product sales and services, the Company recognizes revenue in accordance with Accounting Standards Codification subtopic 605-10, Revenue Recognition (“ASC 605-10”) which requires that four basic criteria must be met before revenue can be recognized: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or services have been rendered; (3) the selling price is fixed and determinable; and (4) collectability is reasonably assured. Determination of criteria (3) and (4) are based on management’s judgments regarding the fixed nature of the selling prices of the products delivered and the collectability of those amounts. Provisions for discounts and rebates to customers, estimated returns and allowances, and other adjustments are provided for in the same period the related sales are recorded. The Company defers any revenue for which the product or services has not been delivered or is subject to refund until such time that the Company and the customer jointly determine that the product has been delivered or no refund will be required.

The Company derives its revenue from the performance under research and development contracts. These contracts require the Company to provide services directed towards specific objectives and include developmental milestones and deliverables. Up-front payments are recorded as deferred revenue and recognized when milestones are achieved. The Company may be reimbursed for certain costs incurred in preforming the specific research and development activities and records the reimbursement as revenues. As of March 31, 2018, and September 30, 2017, deferred revenue was $-0- and $-0-, respectfully.

-10-

The Company derives its revenue from the performance under research and development contracts. These contracts require the Company to provide services directed towards specific objectives and include developmental milestones and deliverables. Up-front payments are recorded as deferred revenue and recognized when milestones are achieved. The Company may be reimbursed for certain costs incurred in preforming the specific research and development activities and record the reimbursement as revenues. As of December 31, 2017, and September 30, 2017, deferred revenue was $-0- and $-0-, respectfully.

Cost of Sales and Service

The cost of sales and service consists of the cost of labor, equipment depreciation, and supplies and materials.

Accounts Receivable

Trade receivables are carried at their estimated collectible amounts. Trade credit is generally extended on a short-term basis; thus trade receivables do not bear interest. Trade accounts receivable are periodically evaluated for collectability based on past credit history with customers and their current financial condition.

Allowance for Doubtful Accounts

Any charges to the allowance for doubtful accounts on accounts receivable are charged to operations in amounts sufficient to maintain the allowance for uncollectible accounts at a level management believes is adequate to cover any probable losses. Management determines the adequacy of the allowance based on historical write-off percentages and the current status of accounts receivable. Accounts receivable are charged off against the allowance when collectability is determined to be permanently impaired. As of ~~December~~ March 31, 2018 ~~2017~~ and September 30, 2017, allowance for doubtful accounts was $-0-.

Property and Equipment

Property and equipment are stated at cost. When retired or otherwise disposed, the related carrying value and accumulated depreciation are removed from the respective accounts and the net difference less any amount realized from disposition, is reflected in earnings. For financial statement purposes, property and equipment are recorded at cost and depreciated using the straight-line method over their estimated useful lives as follows:

Office equipment	5 years
Lab equipment	3 to 7 years

Net Loss per Share of Common Stock

The Company computes basic net loss per share by dividing net loss per share available to common stockholders by the weighted average number of common shares outstanding for the period, adjusted to give effect to the 17-for-1 reverse stock split, which was effective in the market in March 2015, and excludes the effects of any potentially dilutive securities. Diluted earnings per share, if presented, would include the dilution that would occur upon the exercise or conversion of all potentially dilutive securities into common stock using the “treasury stock” and/or “if converted” methods as applicable. The computation of basic and diluted loss per share for the ~~three~~six months ended ~~December~~March 31, ~~2017~~2018 and ~~2016~~2017 excludes potentially dilutive securities when ~~their~~ their inclusion would be anti-dilutive, or if their exercise prices were greater than the average market price of the common stock ~~during~~ during the period.

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The following securities are excluded from the calculation of weighted average dilutive common shares because their inclusion would have been anti-dilutive:

	December 31, 2017		December 31, 2016
		March 31, 2018		March 31, 2017
Shares issued upon conversion of convertible notes and accrued interest		-		-
Shares issued upon conversion of convertible notes		-		-

Intangible Assets

The Company’s intangible assets consists of the following:

Intellectual property for the technology transfer agreement and licensing payments for use of various patents for its worldwide exclusive licensed rights to OvaDx, a diagnostic screening test for the early detection of ovarian cancer which the Company is reviewing to assess the commercialization plan. The carrying value of ~~December~~March 31, ~~2017~~2018 and ~~September~~December 3031, 2017 $ was $1,~~292~~250,~~000~~199 and $1,~~334~~292,000, respectively.

Intellectual property acquired from the THI have led to the development of proteomic technologies for measuring the activation status of key ~~signaling~~ signaling pathways that are instrumental in the development of companion diagnostics for molecular-targeted therapies. The Company ~~uses~~ uses these proteomic technologies to ~~help~~ support the drug development programs of most major pharmaceutical and biotechnology drug development companies. The carrying value of ~~December~~March 31, ~~2017~~2018 and ~~September~~December 3031, 2017 was $3,~~678~~610,~~000~~802 and $3,~~745~~677,~~000~~669, respectively.

Intangible assets with finite lives are amortized over their estimated useful lives. Intangible assets with indefinite lives are not amortized, but are tested for impairment annually. The Company’s intangible asset with a finite life included intellectual property acquired from THI Acquisition, capitalized website development costs and patent costs, which are being amortized over their economic or legal life, whichever is shorter.

The gross carrying amounts and accumulated amortization related to acquired intangible assets as of ~~December~~March 31, ~~2017~~2018 are as follows (in thousands, except year amounts):

Description	Book Value as of September 30, 2017		Additions during the year		Total after Additions		Remaining life In years		Amortization Expense for the Quarter Ended December 31, 2017		Book Value as of December 31, 2017
	Book Value as of		Additions		Total after		Remaining life		Amortization Expense for the Quarter		Book Value as of
License Rights to OvaDx		1,334		-		1,334		9		42		1,292
Description	December 31, 2017		during the year		Additions		In years		Ended March 31, 2018		March 31, 2018
THI Acquisition on May 11, 2016		3,745		-		3,745		15		67		3,678
License Rights to OvaDx		1,292		-		1,292		9		42		1,250
THI Acquisition on May 11, 2016		3,678		-		3,678		15		67		3,611
Website development cost		4		-		4		5		0		4
Patent costs		9996		-		9996		9		3		9693
		5,181				5,181				112		5,069
		5,069				5,069				112		4,958

The Company incurred amortization expense associated with its finite-lived intangible assets of $112,000 for the three months ended ~~December~~March 31, ~~2017~~2018.

Convertible Instruments

U.S. GAAP requires companies to bifurcate conversion options from their host instruments and account for them as free standing derivative financial instruments according to certain criteria. The criteria include circumstances in which (a) the economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics and risks of the host contract, (b) the hybrid instrument that embodies both the embedded derivative instrument and the host contract is not re-measured at fair value under otherwise applicable generally accepted accounting principles with changes in fair value reported in earnings as they occur and (c) a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument. An exception to this rule is when the host instrument is deemed to be conventional, as that term is described under applicable ASC 480-10.

When the Company has determined that the embedded conversion options should not be bifurcated from their host instruments, the Company records, when necessary, discounts to convertible notes for the intrinsic value of conversion options embedded in debt instruments based upon the differences between the fair value of the underlying common stock at the commitment date of the note transaction and the effective conversion price embedded in the note. Debt discounts under these arrangements are amortized over the term of the related debt to their stated date of redemption.

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Derivative Financial Instruments

The Company classifies as equity any contracts that (i) require physical settlement or net-share settlement or (ii) provide the Company with a choice of net-cash settlement or settlement in its own shares (physical settlement or net-share settlement) providing that such contracts are indexed to the Company’s own stock. The Company classifies as assets or liabilities any contracts that (i) require net-cash settlement (including a requirement to net cash settle the contract if an event occurs and if that event is outside the Company’s control) or (ii) gives the counterparty a choice of net-cash settlement or settlement in shares (physical settlement or net-share settlement).

The Company assesses classification of its common stock purchase warrants, if any, and other free-standing derivatives at each reporting date to determine whether a change in classification between assets and liabilities is required.

The Company’s free-standing derivatives consist of embedded conversion options with issued convertible notes. The Company evaluated these derivatives to assess their proper classification in the condensed consolidated balance sheets as of ~~December~~March 31, ~~2017~~2018 using the applicable classification criteria enumerated under ASC 815-Derivatives and Hedging. The Company determined that certain embedded conversion features do not contain fixed settlement provisions. The convertible notes contain a conversion feature such that the Company could not ensure it would have adequate authorized shares to meet all possible conversion demands.

As such, the Company was required to record the debt derivatives which do not have fixed settlement provisions as liabilities and mark to market all such derivatives to fair value at the end of each reporting period.

Recent Accounting Pronouncements

Cash Flows

In August 2016, the FASB issued ASU No. 2016-15 Statement of Cash Flows - Classification of Certain Cash Receipts and Cash Payments, which addresses specific cash flow classification issues where there is currently diversity in practice including debt prepayment and proceeds from the settlement of insurance claims. ASU 2016-15 is effective for annual periods beginning after December 15, 2017, with early adoption permitted. The Company elected to early adopt ASU 2016-15 effective as of September 30, 2016. The adoption of ASU 2016-15 did not impact our results of operations or cash flows.

In November 2016, the FASB issued ASU No. 2016-18 Statement of Cash Flows - Restricted Cash, which requires entities to show the changes in the total of cash, cash equivalents, restricted cash and restricted cash equivalents in the statement of cash flows. As a result, entities will no longer present transfers between cash and cash equivalents and restricted cash and restricted cash equivalents in the statement of cash flows. ASU ~~2017~~2016-18 is effective for annual periods beginning after December 15, 2017, with early adoption permitted. The Company elected to early adopt ASU 2016-18 including retrospective adoption for all prior periods. The impact of the adoption of ASU 2016-18 is the addition of a reconciliation of the totals in the statement of cash flows to the related captions in the balance sheet and was not material to the results.

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Stock Compensation

In March 2016, the FASB issued ASU 2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. The amendment is to simplify several aspects of the accounting for share-based payment transactions including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. For public entities, the amendments in ASU 2016-09 are effective for interim and annual reporting periods beginning after December 15, ~~2017~~2016. The Company is currently evaluating the impact that ASU 2016-09 will have on its consolidated financial statements and related disclosures.

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In May 2017, the FASB issued ASU 2017-09, Compensation—Stock Compensation (Topic 718): Scope of Modification Accounting, which clarifies when to account for a change to the terms or conditions of a share-based payment award as a modification. Under the new guidance, modification accounting is required only if the fair value, the vesting conditions, or the classification of the award (as equity or liability) changes as a result of the change in terms or conditions. It is effective prospectively for the annual period ending December 31, 2018 and interim periods within that annual period. Early adoption is permitted. The Company is currently evaluating the impact of adopting this standard on the consolidated financial statements and disclosures, but does not expect it to have a significant impact.

The Company measures the cost of services received in exchange for an award of equity instruments based on the fair value of the award. For employees and directors, the fair value of the award is measured on the grant date and for non-employees, the fair value of the award is generally re-measured on vesting dates and interim financial reporting dates until the service period is complete. The fair value amount is then recognized over the period during which services are required to be provided in exchange for the award, usually the vesting period. Stock-based compensation expense is recorded by the Company in the same expense classifications in the condensed consolidated statements of operations and comprehensive loss, as if such amounts were paid in cash.

Leases

In February 2016, FASB issued ASU No. 2016-02, Leases (Topic 842) which supersedes FASB ASC Topic 840, Leases (Topic 840) and provides principles for the recognition, measurement, presentation and disclosure of leases for both lessees and lessors. The new standard requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase by the lessee. This classification will determine whether lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease, respectively. A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than twelve months regardless of classification. Leases with a term of twelve months or less will be accounted for similar to existing guidance for operating leases. The standard will be effective for annual and interim periods beginning after December 15, 2018, with early adoption permitted upon issuance. The Company is currently evaluating the impact that ASU 2016-02 will have on its consolidated financial statements and related disclosures.

Business Combinations

In January 2017, the FASB issued ASU No. 2017-01, “Business Combinations (Topic 805) Clarifying the Definition of a Business” The amendments in this ASU clarify the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The definition of a business affects many areas of accounting including acquisitions, disposals, goodwill, and consolidation. The guidance is effective for annual periods beginning after December 15, 2017, including interim periods within those periods. Early adoption is permitted, including for interim or annual periods for which the financial statements have not been issued or made available for issuance. The Company adopted this guidance as of September 30, ~~2017~~2016.

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In July 2017, the FASB issued ASU No. 2017-11, Earnings Per Share (Topic 260), Distinguishing Liabilities from Equity (Topic 480), Derivatives and Hedging (Topic 815). The amendments in Part I of this Update change the classification analysis of certain equity-linked financial instruments (or embedded features) with down round features. When determining whether certain financial instruments should be classified as liabilities or equity instruments, a down round feature no longer precludes equity classification when assessing whether the instrument is indexed to an entity’s own stock. The amendments also clarify existing disclosure requirements for equity-classified instruments. As a result, a freestanding equity-linked financial instrument (or embedded conversion option) no longer would be accounted for as a derivative liability at fair value as a result of the existence of a down round feature. For freestanding equity classified financial instruments, the amendments require entities that present earnings per share (EPS) in accordance with Topic 260 to recognize the effect of the down round feature when it is triggered. That effect is treated as a dividend and as a reduction of income available to common shareholders in basic EPS. Convertible instruments with embedded conversion options that have down round features are now subject to the specialized guidance for contingent beneficial conversion features (in Subtopic 470-20, Debt—Debt with Conversion and Other Options), including related EPS guidance (in Topic 260). The amendments in Part II of this Update recharacterize the indefinite deferral of certain provisions of Topic 480 that now are presented as pending content in the Codification, to a scope exception. Those amendments do not have an accounting effect. For public business entities, the amendments in Part I of this Update are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. For all other entities, the amendments in Part I of this Update are effective for fiscal years beginning after December 15, 2019, and interim periods within fiscal years beginning after December 15, 2020. Early adoption is permitted for all entities, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. The Company is currently evaluating the impact of adopting this standard on the consolidated financial statements and disclosures.

Subsequent Events

The Company evaluates events that have occurred after the balance sheet date but before the financial statements are issued. Based upon the evaluation, the Company did not identify any recognized or non-recognized subsequent events that would have required adjustment or disclosure in the condensed consolidated financial statements, except as disclosed.

NOTE 4 - FAIR VALUE OF FINANCIAL INSTRUMENTS

The Company measures the fair value of financial assets and liabilities based on the guidance of ASC 820 “Fair Value Measurements and Disclosures” which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. ASC 820 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.

ASC 820 describes three levels of inputs that may be used to measure fair value:

	Level 1 —	quoted prices in active markets for identical assets or liabilities

	Level 2 —	quoted prices for similar assets and liabilities in active markets or inputs that are observable

	Level 3 —	inputs that are unobservable based on an entity’s own assumptions, as there is little, if any, related market activity (for example, cash flow modeling inputs based on assumptions)

~~-15-~~Financial liabilities as of March 31, 2018 measured at fair value on a recurring basis are summarized below:

Financial liabilities as of December 31, 2017 measured at fair value on a recurring basis are summarized below:

The Company determined that certain conversion option related to convertible notes issued did not have fixed settlement provisions and are deemed to be derivative financial instruments, since the exercise price was subject to adjustment based on certain subsequent equity transactions that would change the exercise price, the Company elected to use a lower reset provision. Accordingly, the Company was required to record such conversion option as a derivative liability and mark such derivative to fair value each reporting period. Such instrument was classified within Level 3 of the valuation hierarchy. For the purpose of calculating the potential embedded derivatives, the Company utilized an estimated conversion price of $0.02 to $0.05 in estimating the fair value of the conversion option.

~~The fair value of the conversion option was calculated using a binomial lattice formula with the following range of assumptions during the three months December 31, 2017:~~-15-

	At Inception			December 31, 2017
Common Stock Estimated Fair Value	$	0.05			0.02 to 0.05
Conversion Price per share		0.05-0.10			0.06-0.15
Conversion Shares		3,125,000			0
Call Option Value		0.0104 to 0.0226			0.006 to 0.11
Dividend Yield		0.00	%		0.00	%
Volatility		120.00	%		65.60	%
Risk-free Interest rate		0.68	%		0.94 to 1.50	%
Contractual Term		0.75 to 1.00 years			0.04 to 2.68 years

The fair value of the conversion option was calculated using a binomial lattice formula with the following range of assumptions during the six months March 31, 2018:

In the opinion of management, there is not a sufficient viable market for the Company’s common stock to determine its fair value, therefore management considers recent sales of its common stock to independent qualified investors and estimated fair value of net assets acquired through issuance of common stock. Since the valuation model inputs are not fixed, management has estimated the fair value to be utilizing a binomial lattice model. Considerable management judgment is necessary to estimate the fair value at each reporting period. Accordingly, actual results could vary significantly from management’s estimates. Conversion price per share and conversion shares are based on the lower of reset or floor price of the respective notes.

	At Inception			March 31, 2018

Common Stock Estimated Fair Value	$	0.05			0.02 to 0.05
Conversion Price per share		0.05-0.10			0.06-0.15
Conversion Shares		3,125,000			0
Call Option Value		0.0104 to 0.0226			0.006 to 0.11
Dividend Yield		0.00	%		0.00	%
Volatility		120.00	%		65.60	%
Risk-free Interest rate		0.68	%		0.94 to 1.50	%
Contractual Term		0.75 to 1.00 years			0.04 to 2.68 years

Conversion price per share and conversion shares are based on the lower of reset or floor price of the respective notes.

The risk-free interest rate is the United States Treasury rate on the measurement date having a term equal to the remaining contractual life of the instrument. Since the Company’s stock has not been publicly traded with significant volume, the Company is utilizing an expected volatility based on a review of historical volatilities over a period of time equivalent to the expected life of the instrument being valued of similarly positioned public Companies within. The dividend yield is 0% as the Company has not made any dividend payment and has no plans to pay dividends in the foreseeable future.

Level 3 liabilities are valued using unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the derivative liabilities.

Level 3 financial liabilities consist of the derivative liabilities for which there is no current market for these securities such that the determination of fair value requires significant judgment or estimation. Changes in fair value measurements categorized within Level 3 of the fair value hierarchy are analyzed each period based on changes in estimates or assumptions and recorded as appropriate.

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Significant observable and unobservable inputs include stock price, exercise price, annual risk-free rate, term, and expected volatility, and are classified within Level 3 of the valuation hierarchy. An increase or decrease in volatility or interest free rate, in isolation, can significantly increase or decrease the fair value of the derivative liabilities. Changes in the values of the derivative liabilities are recorded as a component of other income (expense) on the Company’s condensed consolidated statements of operations and comprehensive loss.

The following table sets forth a summary of the changes in the fair value of the Company’s Level 3 financial liabilities that are measured at fair value on a recurring basis for the three months ended December 31, 2017:-16-

Balance - Beginning of period	$	1,926,800
Aggregate fair value of derivative instruments issued		20,000
Transfers out upon payoff of notes payable		-
Change in fair value of derivative liabilities		(89,620	)
Balance - End of period	$	1,857,180

The following table sets forth a summary of the changes in the fair value of the Company’s Level 3 financial liabilities that are measured at fair value on a recurring basis for the six months ended March 31, 2018:

Balance - Beginning of period	$	1,857,180
Aggregate fair value of derivative instruments issued		-
Transfers out upon payoff of notes payable		-
Change in fair value of derivative liabilities		175
Balance - End of period	$	1,857,355

NOTE 5 – CONVERTIBLE NOTES PAYABLE

OnAs ~~October~~of 6,March ~~2017~~31, 2018 the Company ~~entered~~had ~~into a securities purchase agreement with the June 2017 Investor pursuant to which the June 2017 Investor purchased~~ $201,~~000 of the June 2017 Investment for an aggregate purchase price of $20~~668,~~000~~525 ~~(the~~in ~~“October 2017 Investment”). The June 2017 notes bear interest at 8% and mature thirty-six months from the date of issuance. The June 2017~~ Notes ~~will be convertible at the option of the holder at any time into shares of common stock, at the June 2017 Initial Conversion Price~~Payable. In connection with the agreement, the June 2017 Investor received an aggregate of 40,000 shares of common stock as commitment shares, a warrant to purchase such number of shares of common stock equal to 200% of their subscription amount divided by the June 2017 Initial Conversion Price and a purchase right to purchase such number of shares of common stock equal to 800% of their subscription amount divided by the June 2017 Initial Conversion Price. The warrants are exercisable for a period of five years from the date of issuance at an initial exercise price of $0.06. The purchase right is exercisable beginning on the eighteen (18) month anniversary of the date of issuance until the five-year anniversary of the date of issuance at an initial exercise price of $0.06.

On October 6, 2017, the Company entered into a securities purchase agreement with Infusion 51a LP (“Investor”) pursuant to which the Investor purchased $20,000 of notes and warrants for an aggregate purchase price of $20,000 on the same terms as the investment made in June and August 2017 (the “Investment”). The notes bear interest at 8% and mature thirty-six months from the date of issuance. The notes will be convertible at the option of the holder at any time into shares of common stock, at $0.06. In connection with the agreement, the Investor received an aggregate of 40,000 shares of common stock as commitment shares, a warrant to purchase such number of shares of common stock equal to 200% of their subscription amount divided by the conversion price and a purchase right to purchase such number of shares of common stock equal to 800% of their subscription amount divided by the June conversion price. The warrants are exercisable for a period of five years from the date of issuance at an initial exercise price of $0.06. The purchase right is exercisable beginning on the eighteen (18) month anniversary of the date of issuance until the five-year anniversary of the date of issuance at an initial exercise price of $0.06.

NOTE 6 – STOCKHOLDERS’ EQUITY

Common Stock

The board of directors authorized the following issuances of stock for services. The Company evaluated in accordance with ASC 505-50 “Equity-Based Payments to Non-Employees”:

During the ~~three~~six months ended ~~December~~March 31, ~~2017~~2018, the Company issued 40,000 restricted shares of common stock for bonus shares to a note ~~for~~ for a fair value of $1,200.

During the ~~three~~six months ended ~~December~~March 31, ~~2017~~2018, the Company issued 2,898,551 restricted shares of common stock to Amarantus BioScience Holdings, Inc. converting part of their contingency liability for legal settlement for a fair value of $57,971.

During the six months ended March 31, 2018, the Company issued 30,092,073 restricted shares of common stock to Amarantus BioScience Holdings, Inc to relinquish all convertible notes, accrued interest, and notes receivable for a fair value of $373,440.

On March 30, 2018, the Company issued an aggregate of 30,092,073 restricted shares of common stock to Amarantus BioScience Holdings, Inc to relinquish all convertible notes, accrued interest, and notes receivable for a fair value of $373,440.

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NOTE 7 – COMMITMENTS AND CONTINGENCIES

Legal

In the normal course of business, the Company may be involved in legal proceedings, claims and assessments arising in the ordinary course of business. Such matters are subject to many uncertainties, and outcomes are not predictable with assurance. There are no such matters that are deemed material to the condensed consolidated financial statements as of December 31, 2017, except as discussed below.

On January 13, 2014, Plaintiff Tamarin Lindenberg sued Arrayit Corporation, the Company, John Howell, Steven Scott and Gregg Linn in Civil Action No. L7698-13. Plaintiff alleged violations of the New Jersey Conscientious Employee Protection Act NJSA 34:19-1 to NJSA 34:19-8 (“CEPA”), breach of contract, breach of covenant of good faith and fair dealing, economic duress and intentional infliction of emotional distress. On August 6, 2014, the District Court dismissed Plaintiff’s complaint against Arrayit Corporation for failure to state a claim upon which relief may be granted and against John Howell for lack of jurisdiction. The Company and its officers remain as defendants in the action. The Company and its officers have mounted a vigorous defense against these claims and believe they are without legal merit.

On or about September 16, 2017, Memory DX, LLC (“MDX”) filed a lawsuit against Amarantus Biosciences Holdings, Inc. (“AMBS”), Amarantus Bioscience Holdings, Inc., Amarantus Diagnostics, Inc., the Company and Avant Diagnostics Acquisition Corporation, et al (collectively the “Defendants”) in the Superior Court of the State of Arizona, County of Maricopa (Case Number CV2017-015026) (the “AZ Court”). On or about December 14, 2017, a default judgment (the “Default Judgment”) was rendered in the Court against the Defendants. On or about February 15, 2017, MDX and the Defendants entered into a settlement agreement related to the satisfaction of the Default Judgment. On May 25, 2017, the parties entered into an amended and restated settlement agreement pursuant to which in consideration for fully satisfying the Default Judgment, the Company paid MDX $30,000, (the “Initial Cash Amount”). In addition, the Company agreed to pay MDX an aggregate of $175,000 by July 30, 2017 (the “Additional Cash Amount” and together with the Initial Cash Amount, the “Cash Consideration”). If the Additional Cash Amount was not paid by July 30, 2017, the Company agreed to pay MDX $20,000 per month beginning August 30, 2017 in full satisfaction of the Additional Cash Amount. On September 19, 2017, the parties entered into a second amended and restated settlement agreement pursuant to which in consideration for fully satisfying the Default Judgment, the Company agreed to provide MDX the following: (i) an aggregate of $250,000 (the “Cash Consideration”) payable as follows: (i) $35,000 which has been previously paid, (ii) $3,500 which was paid upon execution of the agreement (iii) $2,000 which will be payable on the last calendar day of each month for October and November 2017, (iv) $5,000 which will be payable on the last calendar day for December 2017 and each of January and February 2018 and (v) $10,000 which will be payable on the last calendar day of each month until the full consideration is paid. Notwithstanding the foregoing, upon the sale by the Company of its equity securities in a single offering for aggregate gross proceeds of at least $7,500,000 (the “Qualified Offering”) after the date of the agreement, the Company will pay any remaining amount of the Cash Consideration then outstanding upon the final closing of such Qualified Offering. The Company previously issued to MDX 5,000,000 restricted shares of common stock (the “Initial Shares”) on or prior to the date of the amended agreement as partial consideration for the Default Judgment. In addition, the Company agreed to issue MDX an additional 5,000,000 restricted shares of common stock (the “Additional Shares”). Within three (3) business days of the issuance of the Additional Shares, MDX shall take all necessary action to withdraw the recorded Default Judgment. The Default Judgment shall be set aside without prejudice. Upon a default of the obligations to timely pay the Cash Consideration, after written notice and five (5) business days to cure, MDX will be entitled to reinstate the Default Judgment. MDX shall assign the License Agreement between MDX and University of Leipzig dated May 22, 2013, as amended, to the Company, as well as assign the Asset Purchase Agreement between MDX and AMBS to the Company upon final settlement of this matter.

On or about January 23, 2017, Ellenoff Grossman & Schole LLP (“EGS”) filed a complaint (the “EGS Complaint”) in the Supreme Court of the State of New York, County of New York (the “Court”), Case No. 650328/2017, against the Company alleging, among other things, breach of contract, account stated and quantum meruit. On or about June 19, 2017, the Company entered into a settlement agreement with EGS settling all of the allegations set forth in the EGS Complaint. The settlement agreement provides (a) a release of all claims by both parties, and (b) payment of $40,000 to EGS in 10 equal installments. On October 11, 2017, EGS notified the Company that is was in default under the terms of the settlement agreement.

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On or about April 24, 2017, John G. Hartwell (“Hartwell”) and Corrine Ramos (“Ramos” and collectively with Hartwell, the “Plaintiffs”) filed a lawsuit against the Company, Avant Diagnostics Acquisition Corp. and Gregg Linn (collectively the “Defendants”) in the Circuit Court for Montgomery County, Maryland (Case Number 432180-V) (the “MD Court”), On or about June 8, 2017, the parties entered into a settlement agreement pursuant to which the Company agreed to pay Defendants an aggregate of approximately $154,000 in installments as set forth in the agreement. The first payment of $29,819.99 was made by the Defendants to Plaintiffs on or about July 10, 2017. As a result of the first payment being made pursuant to the agreement, Plaintiffs dismissed the action against the Defendants without prejudice on or about July 13, 2017.

-18-

On or about June 27, 2017, Sichenzia Ross Ference Kesner LLP (“SRFK”) filed a complaint (the “SRFK Complaint”) in the Court, Case No. 654465/2017, alleging, among other things, breach of contract, account stated, quantum meruit and unjust enrichment against the Company, in connection with a retainer agreement, dated March 8, 2016, by and between the Company and SRFK (the “Agreement”). SRFK is seeking, among other things, compensatory damages in excess of $120,110, legal fees, interest and such other relief as the Court deems just and proper. On July 23, 2018, a default judgment was entered against the Company in the amount of $120,110 plus costs and disbursements. The Company does not believe it was ever properly served by SRFK. The Company denies the material allegations of the SRFK Complaint and intends to vigorously defend itself in this action. The results of any litigation are inherently uncertain and there can be no assurance that we will prevail in the litigation matter stated above or otherwise.

On or about August 7, 2017, Clear Financial Solutions, Inc. (“CFS”) and Steven Plumb (collectively with CFS, the “Texas Plaintiffs”) filed a complaint (the “Texas Complaint”) in the 129^th Judicial District Court of Harris County, Texas (the “Texas Court”), Case No. 2017-52184, against the Company, Gregg Linn, the Company’s former CEO, Signature Stock Transfer, Inc., the Company’s former transfer agent, and Jason Bogutski, the CEO of the Company’s former transfer agent (collectively, the “Texas Defendants”), alleging, among other things, breach of contract, promissory estoppel, quantum meruit, tortious interference and violations of Nevada law against the Texas Defendants, in connection with the failure to remove the legend on restricted stock held by CFS. The Texas Plantiffs are seeking, among other things, damages in legal fees, interest and such other and further relief to which the Texas Plaintiffs may be entitled at law or in equity. The Company denies the material allegations of the Texas Complaint and is vigorously defending itself in this action. The results of any litigation are inherently uncertain and there can be no assurance that we will prevail in the litigation matter stated above or otherwise.

NOTE 8 – RELATED PARTY TRANSACTIONS

The Company had accrued expenses due to current and former officers, consisting mainly of salary and expenses. As of ~~December~~March 31, ~~2017~~ 2018 and September 30, 2017, accrued payroll and benefits due to officers were $~~294~~233,~~937~~137 and $277,175, respectively.

~~-19-~~The following selling, general and administrative expenses for the six months ended March 31, 2018 were incurred by Scott VanderMeer :

The following professional fees for the three months ended December 31, 2017 were incurred by Philippe Goix, the Company’s former CEO:

	For the Six Months
	ended
	March 31, 2018
Consultant- Related Party	$	36,400
Due to Officers		196
Total	$	36,596

	For the Three
	Months ended
	December 31, 2017
Auto Allowance	$	-
Consultant- Related Party		29,000
Insurance Expense		-
Payroll Expenses		-
Travel Expenses		3,347
Cell Phone Expense	$	-
Total	$	32,347

On December 4, 2017, the Company accepted the resignation of Philippe Goix as the Company’s chief executive officer and director, effective immediately. On December 15, 2017, the Company entered into a Separation and Release Agreement (the “Goix Separation Agreement”) with Philippe Goix, the Company’s former Chief Executive Officer, pursuant to which Dr. Goix’s status as chief executive officer and director of the Company ended effective December 4, 2017. Pursuant to the Goix Separation Agreement, upon the occurrence of a Triggering Event (as defined in the Goix Separation Agreement), the Company shall pay Dr. Goix a lump sum cash payment of $27,346.84 within three (3) business days of the date such Triggering Event occurs.

~~During the three months ended December 31, 2017, Scott VanderMeer, acting CFO, incurred $21,000 of consultant fees – related party.~~-19-

During the six months ended March 31, 2018, Scott VanderMeer, acting CFO, incurred $36,400 of consultant fees – related party.

Infusion 51a LP - Related Party

On October 6, 2017, the Company entered into a securities purchase agreement with the Infusion 51a LP (“Investor”) pursuant to which the Investor purchased $20,000 of notes and warrants for an aggregate purchase price of $20,000 on the same terms as the investment made in June and August 2017 (the “Investment”). The notes bear interest at 8% and mature thirty-six months from the date of issuance. The notes will be convertible at the option of the holder at any time into shares of common stock, at $0.06. In connection with the agreement, the Investor received an aggregate of 40,000 shares of common stock as commitment shares, a warrant to purchase such number of shares of common stock equal to 200% of their subscription amount divided by the conversion price and a purchase right to purchase such number of shares of common stock equal to 800% of their subscription amount divided by the June conversion price. The warrants are exercisable for a period of five years from the date of issuance at an initial exercise price of $0.06. The purchase right is exercisable beginning on the eighteen (18) month anniversary of the date of issuance until the five-year anniversary of the date of issuance at an initial exercise price of $0.06.

NOTE 9 – SUBSEQUENT EVENTS

On March 30, 2018, the Company entered into an Asset Purchase Agreement (the “Purchase Agreement”) with Amarantus Bioscience Holdings, Inc., a Nevada corporation (“AMBS”) pursuant to which the Company sold all intellectual property related to its MSPrecise®, Lympro®, and NuroPro® assets to AMBS in exchange for, among other things, the following: (i) cancellation of all principal, interest and other amounts owed to AMBS pursuant to those certain promissory notes issued on February 28, 2017 (which was assumed by the Company in connection with that certain asset purchase agreement, dated May 11, 2017, by and between the Company and Theranostics Health, Inc.) and March 7, 2017 (of which $100,000 has been paid to date), (ii) assumption by AMBS of $322,500 of contingent liabilities assumed by the Company pursuant to the terms of that certain share exchange agreement, dated May 11, 2017, by and between the Company and AMBS (the “Exchange Agreement”), (iii) the issuance by AMBS of 1,000,000 shares of its common stock to the Company, subject to a lock-up period substantially similar to the lock-up period described below and (iv) the issuance of approximately 30,092,743 shares by the Company to AMBS in satisfaction of all remaining amounts owed to AMBS pursuant to the terms of the Exchange Agreement, subject to the lockup period described below (the “Transaction”). The Transaction closed upon the execution of the Purchase Agreement. The Company issued an aggregate consideration of 30,092,743 shares of its common stock for the Transaction (the “Consideration”). Each share of Company common stock received in connection with the Transaction shall be subject to a lock-up beginning on the Effective Date and ending on the earlier of (i) eighteen (18) months after such date or (ii) a Change in Control (as defined in the Purchase Agreement) or (iii) written consent of the Company, at the Company’s sole discretion.

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On May 25, 2018 (the “Effective Date”), the Company entered into securities purchase agreements (collectively, the “Purchase Agreement”) with accredited investors (the “Investors”) pursuant to which the Company sold an aggregate of six hundred and fifty thousand (650,000) shares of its series A convertible preferred stock for aggregate gross proceeds of $650,000 (the “Series A Preferred Stock”). In addition, existing debtholders of the Company exchanged an aggregate of $516,155 (currently due and payable under existing indebtedness) for an aggregate of 516,155 shares of Series A Preferred Stock pursuant to exchange agreements described below. The terms of the Series A Preferred Stock are set forth under Item 3.02 below.

For a period of one year from the date of final closing of the offering, Investors holding at least a majority of the Series A Preferred Stock outstanding from time to time shall have the right to cause the Company to sell for cash to such Investors on a pro rata basis up to an aggregate of $1,000,000 of common stock in one or more transactions at a 10% discount to the average closing price of the common stock (as reported for consolidated transactions with respect to securities listed on the principal national securities exchange on which the Common Stock is listed or admitted to trading or, if the Common Stock is not listed or admitted to trading on any national securities exchange, then in the over-the-counter market, as reported on any tier maintained by the OTC Markets Group, Inc.) for the thirty (30) consecutive trading days immediately prior to (and including) the Friday preceding the date of such purchase or purchases.

At any time on or after the Effective Date and until the Company’s 2019 annual meeting of stockholders, the Investors, jointly and severally, shall have the exclusive right, voting separately as a class, to elect up to six (6) directors (each director, an “Investor Director”). A Preferred Director so elected shall serve for a term of one year and until his successor is elected and qualified. An Investor Director may, during his or her term of office, be removed at any time, with or without cause, by and only by the affirmative vote, at a special meeting of holders of Series A Preferred Stock called for such purpose. Any vacancy created by such removal may also be filled at such meeting or by such consent for the remainder of such initial one-year term. At any time on or after the Effective Date and until the Company’s 2019 annual meeting of stockholders, Infusion 51a, LP (“Infusion”) shall have the right to elect up to three (3) directors (each director, an “Infusion Director”). An Infusion Director so initially elected shall serve for a term of one year and until his successor is elected and qualified. Any vacancy in the position of an Infusion Director may be filled only by the affirmative vote of Infusion. An Infusion Director may, during his or her term of office, be removed at any time, with or without cause. Any vacancy created by such removal may also be filled by Infusion for the remainder of such initial one-year term.

As soon as practicable after the final closing of the offering, the Company shall use commercially reasonable efforts to take all necessary actions and to obtain such approvals of the Company’s stockholders as may be required to increase the Company’s authorized shares of Common Stock such that the Company can issue all of the shares of Common Stock issuable upon completion of the restructuring and undertake a reverse stock split at such ratio where the number of shares of Common Stock outstanding after consummation of such reverse stock split shall be approximately 15,000,000 shares (the “Reverse Split”) before the exchange of the Series A Preferred Stock into shares of common stock (the “Stockholder Approval”). Until the consummation of the Reverse Split (as defined herein), the Investors appointed AVDX Investors Group LLC (the “Investor Representative”) as its attorney-in20-~~fact for the purpose of carrying out the Stockholder Approval.~~

As soon as practicable after the final closing of the offering, the Company shall use commercially reasonable efforts to take all necessary actions and to obtain such approvals of the Company’s stockholders as may be required to increase the Company’s authorized shares of Common Stock such that the Company can issue all of the shares of Common Stock issuable upon completion of the restructuring and undertake a reverse stock split at such ratio where the number of shares of Common Stock outstanding after consummation of such reverse stock split shall be approximately 15,000,000 shares (the “Reverse Split”) before the exchange of the Series A Preferred Stock into shares of common stock (the “Stockholder Approval”). Until the consummation of the Reverse Split (as defined herein), the Investors appointed AVDX Investors Group, LLC (the “Investor Representative”) as its attorney-21in-fact for the purpose of carrying out the Stockholder Approval.

On the Effective Date, the Company entered into a Consulting Agreement (the “Agreement”) with Investor Representative. Under the Agreement, the Investor Representative shall perform such consulting and advisory services, within Investor Representative’s area of expertise, as the Company or any of its subsidiaries may reasonably require from time to time. During the six-month term of the Agreement, Jeff Busch shall perform the services on behalf of Investor Representative (“Designated Person”). The Agreement has an initial term of six months from the date of execution and shall automatically renew on a monthly basis unless either party gives notice of non-renewal to the other party at least fifteen days prior to the date of the Agreement, provided this agreement shall not extend beyond 12 months from the date of the Agreement. Pursuant to the Agreement, the Company shall pay Investor Representative an annual amount of $160,000, payable either in cash or Series A Preferred Stock (or Common Stock upon filing of the Charter Amendment and consummation of the Reverse Split) during the term of the Agreement (the “Base Compensation”). The Company shall promptly reimburse Investor Representative for all travel, meals, entertainment and other ordinary and necessary expenses incurred by Investor Representative in the performance of its duties to the Company. Investor Representative’s and Designated Person’s position with the Company may be terminated at any time, with or without cause or good reason, upon at least 30 days prior written notice. During the term of the Agreement and for a period of twelve months thereafter, Investor Representative and Designated Person will be subject to non-competition and non-solicitation provisions, subject to standard exceptions. Investors will also provide Investor Representative an irrevocable proxy to vote their shares on all corporate matters until completion of the Reverse Split.

From the Effective Date until the consummation of the Reverse Split, upon any issuance by the Company of common stock or Common Stock Equivalents (as defined in the Series A Certificate of Designations (as defined below)) for cash consideration, indebtedness or a combination of units thereof (a “Subsequent Financing”), each Qualifying Purchaser (as defined below) shall have the right to participate in up to an amount of the Subsequent Financing equal to 50% of the Subsequent Financing on the same terms, conditions and price provided for in the Subsequent Financing. For purposes herein, “Qualifying Purchaser” means an Investor with a subscription amount of at least $150,000.

Beginning on the six month anniversary of the final closing of the offering, on or prior to the sixtieth (60th) calendar day after the date of receipt of written demand from Investors holding at least 51% of Registrable Securities (as defined in the Purchase Agreement), the Company shall prepare and file with the Securities and Exchange Commission (the “SEC”) a registration statement covering the resale of all of the Registrable Securities that are not then registered on an effective registration statement.

In connection with the offering, we agreed to pay our placement agent, a registered broker-dealer, or the Placement Agent, (i) a cash commission of 8% of the gross proceeds raised from investors in the offering, and to issue to the Placement Agent warrants to purchase a number of shares of common stock equal to 4% of the gross proceeds divided by the respective offering price, with a term of seven years from the date of issuance.

-21-

On the Effective Date, the Company entered into an exchange agreement (collectively, the “2017 Investors Exchange Agreement”) with the investors who purchased convertible promissory notes between June 2017 and October 2017 (the “2017 Notes”) for an aggregate principal amount of $545,000 (the “2017 Investors”). Pursuant to the terms of the 2017 Investors Exchange Agreement, the Company agreed to exchange (i) the principal amount due under the 2017 Notes (ii) warrants to purchase 18,166,667 shares of common stock and (iii) purchase rights to purchase shares of common stock for an aggregate of 72,666,667 shares of common stock, in exchange for an aggregate approximately 22,290,800 shares of series B convertible preferred stock having an aggregate value of $545,000 (the “Series B Preferred Stock”). The 2017 Investors have agreed to waive the defaults and breaches that have resulted on or prior to the Effective Date as well as any penalties, interest or other amounts that may have accrued under the 2017 Notes after March 31, 2018. The terms of the Series B Preferred Stock are set forth under Item 3.02 below. In addition, each 2017 Investor entered into a termination agreement with the Company (collectively, the “2017 Investors Termination Agreement”) pursuant to which as of the Effective Date, (i) the securities purchase agreements and pledge agreements entered into with the 2017 Investors (the “2017 Investors Prior Agreements”) were terminated in their entirety and shall have no further force or effect, (ii) the security interests granted by the pledge agreements were terminated and shall have no further force or effect and (iii) neither party shall have any further rights or obligations under the Prior Agreements. The 2017 Investors also authorized the Company or his/her/its representatives to take all actions as they determine in their sole discretion to discharge and release any and all security interests, pledges, liens, and other encumbrances held by such 2017 Investor on the Company’s assets.

-22-

In connection with the 2017 Investors Exchange Agreement, the 2017 Investors have agreed to a lock-up agreement with respect to any shares of common stock it may receive beginning on May 25, 2018 and ending on the nine (9) month anniversary of the date the Company’s laboratory is open for business (the “Lockup Period”). For the first one hundred and eighty (180) days after termination of the Lockup Period, the 2017 Investors shall be subject to a daily liquidation limit for any sales of common stock equal to two and a half percent (2.5%) of the average trading volume of the Company’s common stock for the prior five (5) trading days, but excluding the date of sale (the “Leakout Limitation”). For any sale proposed by the 2017 Investors in excess of the Leakout Limitation, the Company will have (a) a right of first refusal for a period of 15 business days after receipt of written notice of such sale from the 2017 Investor, to purchase such shares of common stock subject to the Leakout Limitation at a price equal to the average closing price per share of the Company’s common stock for the prior five (5) trading days prior to such notice, and (b) if not purchased by the Company, the Company will have approval rights of the counter party proposed by a 2017 Investor for the sale of any such securities, such approval in the Company’s sole and absolute discretion.

On the Effective Date, the Company entered into an exchange agreement (collectively, the “~~2017~~2016 Investors Exchange Agreement”) with the investors who purchased convertible promissory notes between November ~~2017~~2016 and January 2017 (the “~~2017~~2016 Notes”) for an aggregate principal amount of $786,500 (the “~~2017~~2016 Investors”). Pursuant to the terms of the ~~2017~~2016 Investors Exchange Agreement, the Company agreed to exchange (i) the principal amount due under the ~~2017~~2016 Notes in exchange for an aggregate of (i) 323,323 shares of Series A Preferred Stock having an aggregate value of $323,323 and (ii) approximately 3,324,065 shares of series B convertible preferred stock having an aggregate value of approximately $498,610 (the “Series B Preferred Stock”) and (iii) exchange for the issuance of new promissory note due twenty-four (24) months from the Effective Date in the aggregate principal amount of $47,259 (the “New ~~2017~~2016 Investor Note”). The New ~~2017~~2016 Investor Note shall bear interest at 12% per annum and has mandatory payments of $2,000 every 30 days until paid in full starting June 25, 2018. In connection with the ~~2017~~2016 Investors Exchange Agreement, the ~~2017~~2016 Investors have agreed to waive the defaults and breaches that have resulted on or prior to the Effective Date as well as any penalties, interest or other amounts that may have accrued under the ~~2017~~2016 Notes after March 31, 2018.

On the Effective Date, the Company entered into an exchange Agreement (the “Coastal Exchange Agreement”) with Coastal Investment Partners, LLC (“Coastal”). Pursuant to the terms of the Coastal Exchange Agreement, the Company agreed to exchange the principal amount due under the convertible promissory note dated July 6, 2017 plus accrued but unpaid interest and default and other amounts due and payable under such notes, which was $305,664 as of the Effective Date (the “Coastal Notes”) in exchange for (i) 192,832 shares of Series A Preferred Stock having an aggregate value of $192,832 and (ii) the issuance of new convertible promissory notes due eighteen (18) months from the Effective Date in the aggregate principal amount of $192,832 (the “New Coastal Note”). The New Coastal Note shall bear interest at 8% per annum and is convertible into shares of the Company’s common stock at $0.015 per share, subject to adjustment. Coastal has contractually agreed to restrict their ability to convert the New Coastal Note such that the number of shares of the Company common stock held by them and their affiliates after such conversion does not exceed 9.99% of the Company’s then issued and outstanding shares of common stock. In connection with the Coastal Exchange Agreement, Coastal agreed to waive the defaults and breaches that have resulted on or prior to the Effective Date as well as any penalties, interest or other amounts that may have accrued under the Coastal Notes after March 31, 2018. In addition, Coastal entered into a termination agreement with the Company pursuant to which as of the Effective Date, (i) the securities purchase agreements and pledge agreements entered into with Coastal (the “Coastal Prior Agreements”) were terminated in their entirety and shall have no further force or effect, (ii) the security interests granted by the pledge agreement were terminated and shall have no further force or effect and (iii) neither party shall have any further rights or obligations under the Coastal Prior Agreements. Coastal also authorized the Company or its representatives to take all actions as they determine in their sole discretion to discharge and release any and all security interests, pledges, liens, and other encumbrances held by it on the Company’s assets.-22-

~~-23-~~On the Effective Date, the Company entered into an exchange Agreement (the “Coastal Exchange Agreement”) with Coastal Investment Partners, LLC (“Coastal”). Pursuant to the terms of the Coastal Exchange Agreement, the Company agreed to exchange the principal amount due under the convertible promissory note dated July 6, 2016 plus accrued but unpaid interest and default and other amounts due and payable under such notes, which was $305,664 as of the Effective Date (the “Coastal Notes”) in exchange for (i) 192,832 shares of Series A Preferred Stock having an aggregate value of $192,832 and (ii) the issuance of new convertible promissory notes due eighteen (18) months from the Effective Date in the aggregate principal amount of $192,832 (the “New Coastal Note”). The New Coastal Note shall bear interest at 8% per annum and is convertible into shares of the Company’s common stock at $0.015 per share, subject to adjustment. Coastal has contractually agreed to restrict their ability to convert the New Coastal Note such that the number of shares of the Company common stock held by them and their affiliates after such conversion does not exceed 9.99% of the Company’s then issued and outstanding shares of common stock. In connection with the Coastal Exchange Agreement, Coastal agreed to waive the defaults and breaches that have resulted on or prior to the Effective Date as well as any penalties, interest or other amounts that may have accrued under the Coastal Notes after March 31, 2018. In addition, Coastal entered into a termination agreement with the Company pursuant to which as of the Effective Date, (i) the securities purchase agreements and pledge agreements entered into with Coastal (the “Coastal Prior Agreements”) were terminated in their entirety and shall have no further force or effect, (ii) the security interests granted by the pledge agreement were terminated and shall have no further force or effect and (iii) neither party shall have any further rights or obligations under the Coastal Prior Agreements. Coastal also authorized the Company or its representatives to take all actions as they determine in their sole discretion to discharge and release any and all security interests, pledges, liens, and other encumbrances held by it on the Company’s assets.

On the Effective Date, the Company entered into an exchange agreement (the “Black Mountain Exchange Agreement”) with Black Mountain Equity Partners LLC (“Black Mountain”). Pursuant to the terms of the Black Mountain Exchange Agreement, the Company agreed to exchange the principal amount due under the convertible promissory note dated November 11, ~~2017~~2016 (the “Black Mountain Note”) in exchange for the issuance of new promissory note due twelve (12) months from the Effective Date in the aggregate principal amount of $20,000 (which includes a prepayment amount of $5,000 made on the Effective Date) (the “New Black Mountain Note”). The New Black Mountain Note shall bear interest at 12% per annum and has mandatory payments of $5,000 every 90 days until paid in full. In connection with the Black Mountain Exchange Agreement, Black Mountain agreed to waive the defaults and breaches that have resulted on or prior to the Effective Date as well as any penalties, interest or other amounts that may have accrued under the Black Mountain Note after March 31, 2018.

On May 25, 2018, the Company filed a Certificate of Designation of Preferences, Rights and Limitations of the Series A Preferred Stock with the Secretary of State of the State of Nevada (the “Series A Certificate of Designation”).

On May 25, 2018, the Company filed a Certificate of Designation of Preferences, Rights and Limitations of the Series B Preferred Stock with the Secretary of State of the State of Nevada (the “Series B Certificate of Designation”).

On May 25, 2018, the Company entered into an employment agreement (the “Ruxin Agreement”) with Dr. Ruxin under which he will serve as Chief Executive Officer of the Company. The term of the Ruxin Agreement was effective as of May 25, 2018, continues until May 25, 2023 and automatically renews for successive one-year periods at the end of each term until either party delivers written notice of their intent not to renew at least 60 days prior to the expiration of the then effective term. Under the terms of the Ruxin Agreement, Dr. Ruxin will receive an annual salary of $250,000. He is eligible to receive a cash bonus of up to 100% of his base salary. The bonus shall be earned upon the Company’s achievement of performance targets for a fiscal year to be mutually agreed upon by Dr. Ruxin and the board or a committee thereof. Additionally, following the adoption by the Company of an equity compensation plan and subject to approval of the board or a committee thereof, Dr. Ruxin shall receive (i) a one-time restricted stock unit award having a fair value of approximately $100,000 and which shall vest over a five year period following the date of grant and (ii) an option to purchase ten percent (10%) of the outstanding shares of the Company (calculated on the date of grant), which shall vest over a five-year period following the date of grant and expire on the tenth anniversary of the date of grant. Dr. Ruxin is entitled to participate in any and all benefit plans, from time to time, in effect for senior management, along with vacation, sick and holiday pay in accordance with the Company’s policies established and in effect from time to time.

-23-

Dr. Ruxin is an “at-will” employee and his employment may be terminated by the Company at any time, with or without cause. In the event Dr. Ruxin’s termination of employment is the result of termination by the Company without Cause (as defined in the Ruxin Agreement) with Good Reason (as defined in the Ruxin Agreement) or as a result of a non-renewal of the term of employment under the Ruxin Agreement, Dr. Ruxin shall be entitled to receive the sum of (I) the Severance Multiple (as defined below), multiplied by his base salary immediately prior to such termination and (II) a pro-rata portion of his bonus for the year in which such termination occurs equal to (a) his bonus for the most recently completed calendar year (if any), multiplied by (b) a fraction, the numerator of which is the number of days that have elapsed from the beginning of such calendar year through the date of termination and the denominator of which is the total number of days in such calendar year. “Severance Multiple” shall mean 2.0; provided, however, that if the date of termination occurs on or at any time during the twelve (12)-month period following a Change in Control (as defined in the Ruxin Agreement), the Severance Multiple shall mean 3.0. In addition, the Company shall accelerate the vesting of any outstanding, unvested equity awards granted to Dr. Ruxin prior to the date of termination and he shall be entitled to reimbursement of any COBRA payment made during the 18-month period following the date of termination.

-24-

The Ruxin Agreement also contains covenants (a) restricting the executive from engaging in any activity competitive with our business during the term of the employment agreement and in the event of termination, for a period of one year thereafter, (b) prohibiting the executive from disclosing confidential information regarding us, and (c) soliciting our employees, customers and prospective customers during the term of the employment agreement and for a period of one year thereafter.

On May 25, 2018, the Company entered into an employment agreement (the “Busch Agreement”) with Mr. Busch under which he will serve as Executive Chairman of the Company. The term of the Busch Agreement was effective as of May 25, 2018, continues until May 25, 2023 and automatically renews for successive one-year periods at the end of each term until either party delivers written notice of their intent not to renew at least 60 days prior to the expiration of the then effective term. Under the terms of the Busch Agreement, Mr. Busch will receive an annual salary of $30,000, which amount shall be automatically increased to $120,000 on the first anniversary of the date of the Busch Agreement. He is eligible to receive a discretionary cash bonus at the option of the board based on their evaluation of his performance of duties and responsibility. Additionally, following the adoption by the Company of an equity compensation plan and subject to approval of the board or a committee thereof, Mr. Busch shall receive (i) a one-time restricted stock unit award having a fair value of approximately $100,000 and which shall vest over a five year period following the date of grant and (ii) an option to purchase ten percent (10%) of the outstanding shares of the Company (calculated on the date of grant), which shall vest over a five-year period following the date of grant and expire on the tenth anniversary of the date of grant. Mr. Busch is entitled to participate in any and all benefit plans, from time to time, in effect for senior management, along with vacation, sick and holiday pay in accordance with the Company’s policies established and in effect from time to time.

Mr. Busch is an “at-will” employee and his employment may be terminated by the Company at any time, with or without cause. In the event Mr. Busch’s termination of employment is the result of termination by the Company without Cause (as defined in the Busch Agreement) with Good Reason (as defined in the Busch Agreement) or as a result of a non-renewal of the term of employment under the Busch Agreement, Mr. Busch shall be entitled to receive the sum of (I) the Severance Multiple (as defined below), multiplied by his base salary immediately prior to such termination and (II) a pro-rata portion of his bonus for the year in which such termination occurs equal to (a) his bonus for the most recently completed calendar year (if any), multiplied by (b) a fraction, the numerator of which is the number of days that have elapsed from the beginning of such calendar year through the date of termination and the denominator of which is the total number of days in such calendar year. “Severance Multiple” shall mean 2.0; provided, however, that if the date of termination occurs on or at any time during the twelve (12)-month period following a Change in Control (as defined in the Busch Agreement), the Severance Multiple shall mean 3.0. In addition, the Company shall accelerate the vesting of any outstanding, unvested equity awards granted to Mr. Busch prior to the date of termination and he shall be entitled to reimbursement of any COBRA payment made during the 18-month period following the date of termination.

-24-

The Busch Agreement also contains covenants (a) restricting the executive from engaging in any activity competitive with our business during the term of the employment agreement and in the event of termination, for a period of one year thereafter, (b) prohibiting the executive from disclosing confidential information regarding us, and (c) soliciting our employees, customers and prospective customers during the term of the employment agreement and for a period of one year thereafter.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risks in the section entitled “Risk Factors” set forth in our Annual Report on Form 10-K for the fiscal year ended September 30, 2017, any of which may cause our company’s or our industry’s actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. These risks include, by way of example and not in limitation:

	●	general economic and business conditions;
	●	substantial doubt about our ability to continue as a going concern;
	●	our needs to raise additional funds in the future which may not be available on acceptable terms or at all;
	●	our inability to successfully recruit and retain qualified personnel in order to continue our operations;
	●	our ability to successfully implement our business plan;
	●	if we are unable to successfully acquire, develop or commercialize new products;
	●	our expenditures not resulting in commercially successful products;
	●	third parties claiming that we may be infringing their proprietary rights that may prevent us from manufacturing and selling some of our products;
	●	the impact of extensive industry regulation, and how that will continue to have a significant impact on our business, especially our product development, manufacturing and distribution capabilities; and
	●	other factors discussed under the section entitled “Risk Factors” set forth in our Form 10-K for the year ended September 30, 2017 filed with the Securities and Exchange Commission.

Readers are urged to carefully review and consider the various disclosures made by us in this report and in our other reports filed with the Securities and Exchange Commission. The following Management’s Discussion and Analysis of Financial Condition and Results of Operations of the Company should be read in conjunction with the Condensed Consolidated Financial Statements and notes related thereto included in this Quarterly Report on Form 10-Q. We undertake no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes in the future operating results over time except as required by law. We believe that our assumptions are based upon reasonable data derived from and known about our business and operations. No assurances are made that actual results of operations or the results of our future activities will not differ materially from our assumptions.

As used in this Quarterly Report on Form 10-Q and unless otherwise indicated, the terms “we”, “us”, “our”, “Avant” or the “Company” refer to Avant Diagnostics, Inc. and its subsidiaries. Unless otherwise specified, all dollar amounts are expressed in United States dollars.

Overview

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In connection with the purchase of the business assets and certain liabilities of Theranostics Health, Inc. (“THI”) the Company acquired a CLIA laboratory located in Gaithersburg, Maryland. THI is a leading developer of proteomic technologies for measuring the activation status of key signaling pathways that are instrumental in the development of companion diagnostics for molecular-targeted therapies. THI has used these proteomic technologies to support the drug development programs of most major pharmaceutical and biotechnology drug development companies. THI is also providing these testing capabilities to clinical oncologists to advance personalized medicine through its TheraLink® Data-generating assays.

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As a result of the cost cutting measures taken during the fiscal year ended September 30, 2017, the Company substantially curtailed the use of the CLIA laboratory. As a result of these cost cutting measures, the Company was unable to timely make certain payments on the terms of the lease. As a result, the Company defaulted on its lease at the location of the Maryland laboratory and the landlord held the equipment located in the facility as collateral for amounts owed under the lease. AVDX Investors Group, LLC (“AVDX”), an entity controlled by Jeff Busch, our Executive Chairman (“Busch”) loaned the Company the capital to purchase the equipment. The note issued to AVDX is a demand promissory note that bears no interest and is secured by the equipment. During the fiscal year ended September 30, 2018, AVDX, Busch and his affiliated entities also loaned and/or paid certain obligation amounts on behalf of the Company.

Once the Company reacquired the equipment for the laboratory, management undertook a review of the Company’s current operations and decided to move the CLIA laboratory from Maryland to Golden, Colorado (the “New Lab”) In connection with the relocation to the New Lab, the Company executed a lease, built out the space for the New Lab and moved the equipment from Maryland to Colorado. In connection with this relocation, management, in consultation with scientists from George Mason University, the licensor of the Company’s Theralink® technology (“Licensor”), evaluated the status of the Company’s equipment. It was determined that the equipment was not properly maintained and was left in poor working order. As a result, the Company had to spend approximately $152,~~376~~209 during the fiscal year ended September 30, 2018 to have the equipment fixed for the New Lab, so the Licensor could assist management with the set up and validation of the equipment to be used for the technology. The Company continues to build out the lab and plans to have it operational during the fiscal year ended September 30, 2019.

Results of Operations

Comparison of the ~~Three~~Six Months Ended ~~December~~March 31, ~~2017~~2018 ~~and~~to the ~~Three~~Six Months Ended ~~December~~March 31, ~~2016~~2017

Revenue

For ~~three~~six months ended ~~December~~March 31, ~~2017~~2018, total revenue was $-0- compared to $~~242~~255,~~021~~951 for the same period in fiscal ~~2016~~2017. The revenue ~~for~~ for the ~~three~~six months ended ~~December~~March 31, ~~2016~~2017 was related to pharma projects and is comprised of performance under research and ~~development~~ development contracts.

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Cost of Revenue

Cost of revenue was $~~-0-~~24,787 or 09.068% of related sales for the ~~three~~six months ended ~~December~~March 31, 2017 giving us a gross profit of $~~-0- or~~231,164 0or 90.032%. ~~The~~We ~~Company~~did ~~cost~~not ofhave revenue ~~was $22,963~~ or ~~9.5%~~cost of ~~related~~revenue ~~sales~~ for ~~the~~same ~~three~~period ~~months~~in ~~ended December 31, 2016 giving us a gross profit of $219,058 or 90~~2018.~~5%.~~

Operating Expenses

General and administrative expenses

General and administrative expenses decreased by $~~195~~512,~~458~~932 from $~~443~~998,~~290~~181 to $~~247~~485,~~832~~249 for the ~~three~~six months ended ~~December~~March 31, ~~2017~~2018, as compared to the same period in ~~2016~~2017. The overall decrease is primarily the result of ~~less~~no operating activities of THI, net with reductions in service provider costs of Avant. In addition, during the current year, we amortized certain intangible assets and patents. As such, amortization was $~~111~~223,~~899~~796 for the ~~three~~six months ended ~~December~~March 31, ~~2017~~2018 as compared to $~~111~~223,~~898~~840 for the same period, last year.

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Professional fees

Professional fee expenses ~~decreased~~decrease by $4,~~693~~658,~~959~~535 from $4,~~806~~898,~~763~~160 to $~~112~~239,~~804~~625 for the same period, respectively which was primarily due ~~to the~~ legal ~~fees~~ and ~~consultant~~consultants ~~fees~~fee incurred in the current period. Common stock issued for professional services was expensed at the grant date stock price.

Other Expenses:

Interest expense

Interest expense during the ~~three~~six months ended ~~December~~March 31, ~~2017~~2018 was ($3311,~~738~~080) compared to $~~372~~516,~~928~~573 for the ~~three~~six months ended ~~December~~March 31, ~~2016.~~ 2017. Interest expense primarily consists of amortization of debt discounts and accrued interest incurred relating to our issued ~~convertible~~ convertible notes payable. ~~The debt discount amortization incurred during the three months ended December 2017 and 2016 was $-0- and $(4,426), respectively.~~

Loss on change in fair value of derivative

During ~~three~~six months ended ~~December~~March 31, ~~2017~~2018, we issued convertible promissory notes with an embedded derivative, all requiring us to ~~fair~~ fair value the derivatives each reporting period and mark to market as a non-cash adjustment to our current period operations. ~~This~~ This resulted in a loss of $69,~~620~~445 on change in fair value of derivative liabilities for the ~~three~~six months ended ~~December~~March 31, ~~2017 and was $1,854,742 for the same period in 2016~~2018.

Liquidity and Capital Resources

Working Capital

The following table sets forth a summary of working capital as of:

	December 31, 2017			September 30, 2017
	March 31,			September 30,
Current assets	$	50,967		$	1,348
	2018			2017
Current liabilities		4,378,747			4,252,921
Current assets	$	67,644		$	1,348
Working capital	$	(4,327,780	)	$	(4,251,574	)
Current liabilities		4,203,121			4,252,922
Working capital	$	(4,135,477	)	$	(4,251,575	)

Current assets increased by $4966,~~619~~296 from $1,348 to $5067,~~967~~644 for the ~~three~~six months ended ~~December~~March 31, ~~2017~~2018, as compared to September 30, 2017. The overall increase is primarily due to athe ~~loan~~prepayment ~~from~~subscriptions ~~AVDX~~of ~~Investor~~Series ~~Group,~~A ~~LLC~~ during the ~~three~~six months ended ~~December~~March 31, ~~2017~~ ~~and~~2018 ~~2016~~ for net proceeds of $58287,~~195~~500 and $-0-, respectively.

The decline in the working capital deficit is primarily due to an increase in accounts payable, accrued payroll and benefits, accrued expenses, and a decrease in accrued interest and derivative liabilities offset by an increase of cash.-27-

~~-28-~~The incline in the working capital deficit is primarily due to an increase in accounts payable and accrued expenses offset by an increase of cash and reduction in accrued interest, payroll and benefits, and derivative liabilities.

Cash Flows

The following table sets forth a summary of changes in cash flows for the ~~three~~six months ended ~~December~~March 31, ~~2017~~2018 and ~~2016~~2017:

	Three Months Ended December 31,
	Six Months Ended March 31,
	2017			2016
	2018			2017
Net cash used in operating activities	$	2946,~~619~~597		$	~~501~~451,~~199~~443
Net cash provided by (used in) investing activities		2046,~~000~~560			(242,~~648~~647	)
Net cash provided by financing activities		-(26,861	)		(~~185~~200,~~660~~086	)
Change in cash	$	4966,~~619~~296		$	728,~~892~~709

Total net cash decreased due to a decrease in cash provided by operating activities which was offset by changes in our operating assets and liabilities of $2946,~~619~~597, amortization and depreciation of $~~111~~233,~~899~~796, and with loss on change in derivative liability of $969,~~045~~445 for the ~~three~~six months ended ~~December~~March 31, ~~2017~~2018. Net cash provided by investing activities for the ~~three~~six months ended ~~December~~March 31, ~~2017~~ ~~compared~~2018 compared to ~~December~~March 31, ~~2016~~2017 was primarily from licensing, and other assets, ~~and website development costs~~ of $2046,~~000~~560 and ($242,~~648~~647), respectively. Net cash provided by financing activities for the ~~three~~six months ended ~~December~~March, 31, ~~2017~~2018 is due to net cash proceeds from the issuance of convertible notes and common stock of $~~-0-~~26,861 compared to ($~~185~~200,~~660)~~086 for ~~December~~March 31, ~~2016~~2017.

Going Concern

The unaudited condensed consolidated financial statements contained in this quarterly report have been prepared assuming that the Company will continue as a going concern. We have accumulated losses since inception of approximately $31.4375 million. Presently, we do not have sufficient cash resources to meet our plans for the next twelve months. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The unaudited condensed consolidated financial statements do not include any adjustments that may be necessary should the Company be unable to continue as a going concern. Our continuation as a going concern is dependent on our ability to obtain additional financing as may be required and ultimately to attain profitability. ~~These conditions raise substantial doubt about the Company’s ability to continue as a going concern.~~

~~The~~We ~~Company~~believe ~~believes~~ that we will require additional financing to carry out our intended objectives during the next twelve months. There can be no assurance, however, that such financing will be available or, if it is available, that we will be able to structure ~~such~~ such financing on terms acceptable to us and that it will be sufficient to fund our cash requirements until we can reach a level of of profitable operations and positive cash flows. If we are unable to obtain the financing necessary to support our operations, we we may be unable to continue as a going concern. We currently have no firm commitments for any additional capital. Further, if we we issue additional equity or debt securities, stockholders may experience additional dilution or the new equity securities may ~~have~~ have rights, preferences or privileges senior to those of existing holders of our shares of common stock or the debt securities ~~may~~ may cause us to be subject to restrictive covenants.

Even if we are able to raise the funds required, it is possible that we could incur unexpected costs and expenses or experience unexpected cash requirements that would force us to seek additional financing. If additional financing is not available or is not available on acceptable terms, we will have to curtail our operations.

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Cash Requirements

Our plan of operation over the next 12 months is to:

	●	Get current with the Securities and Exchange Commission;
	●	Hire 2 Ph.D.’s to begin the staffing of the lab;
	●	Open the laboratory under GLP compliance;
	●	Begin the process for CAP/CLIA certification;
	●	Continue on the road map towards a reimbursement code;
	●	Hire a Chief Financial Officer;
	●	Obtain contracts for pre-clinical and clinical research with biopharma companies;
	●	Continue to seek financing to grow the company

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to stockholders.

Effects of Inflation

We do not believe that inflation has had a material impact on our business, revenues or operating results during the periods presented.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not Applicable

ITEM 4. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

As required by Rule 13a-15(b) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), our management carried out an evaluation, with the participation of our Chief Executive Officer, of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) of the Exchange Act), as of the period covered by this report. Disclosure controls and procedures are defined as controls and other procedures that are designed to ensure that information required to be disclosed by us in reports filed with the SEC under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and (ii) accumulated and communicated to the Company’s management, including its principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure. Based upon their evaluation, our management (including our former Chief Executive Officer) concluded that our disclosure controls and procedures were not effective as of ~~December~~March 31, ~~2017~~2018, based on the material weaknesses defined below:

	(i)	inadequate segregation of duties consistent with control objectives; and

	(ii)	ineffective controls over period end financial disclosure and reporting processes.

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Management’s Remediation Plan

We plan to take steps to enhance and improve the design of our internal control over financial reporting. During the period covered by this quarterly report on Form 10-Q, we have not been able to remediate the material weaknesses identified above. To remediate such weaknesses, we plan to implement the following changes in the future:

	(i)	appoint additional qualified personnel to address inadequate segregation of duties and ineffective risk management; and

	(ii)	adopt sufficient written policies and procedures for accounting and financial reporting.

The remediation efforts set out in (i) are largely dependent upon our company securing additional financing to cover the costs of implementing the changes required. If we are unsuccessful in securing such funds, remediation efforts may be adversely affected in a material manner. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues, if any, within our company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake.

Management believes that despite our material weaknesses set forth above, our condensed consolidated financial statements for the quarter ended ~~December~~March 31, ~~2017~~2018 are fairly stated, in all material respects, in accordance with US GAAP.

Changes in Internal Control Over Financial Reporting

There were no changes in our internal control over financial reporting that occurred during the quarter ended ~~December~~March 31, ~~2017~~2018 that ~~have~~ have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

From time to time, we may become involved in various lawsuits and legal proceedings that arise in the ordinary course of business. However, litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm our business. We are not currently a party to any material legal proceedings except as described below.

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ITEM 1A. RISK FACTORS

As a smaller reporting company (as defined in Rule 12b-2 of the Exchange Act), we are not required to provide the information called for by this Item 1A.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Unless otherwise set forth above, the securities described above were not registered under the Securities Act of 1933, as amended (the “Securities Act”), or the securities laws of any state, and were offered and sold in reliance on the exemption from registration afforded by Section 4(a)(2) under the Securities Act an and corresponding provisions of state securities laws, which exempt transactions by an issuer not involving any public offering.

On ~~October~~March 630, ~~2017~~2018, the Company issued an aggregate of 4030,~~000~~092,073 restricted shares of common stock ~~for~~to ~~bonus~~Amarantus ~~shares~~BioScience Holdings, Inc to arelinquish ~~note~~all convertible notes, accrued interest, and notes receivable for a fair value of $1373,~~200~~440.

OnDuring ~~November~~the 11six months ended March 31, ~~2017~~2018, the Company issued ~~an aggregate of 2~~30,~~898~~092,~~551~~073 restricted shares of common stock ~~for~~to ~~legal~~Amarantus ~~settlement~~BioScience Holdings, Inc to relinquish all convertible notes, accrued interest, and notes receivable for a fair value of $57373,~~971~~440.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

As of January 15, 2017 the Company was in default on ~~certain~~all Senior Secured Notes.

ITEM 4. MINE SAFETY DISCLOSURES

Not Applicable.

ITEM 5. OTHER INFORMATION

None.

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ITEM 6. EXHIBITS

No.		Description

31.1*		Certification Statement of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.2*		Certification Statement of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

32.1*		Certification Statement of the Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

32.2*		Certification Statement of the Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

101*		Financial statements formatted in Extensible Business Reporting Language (XBRL): (i) the Condensed Consolidated Balance Sheets, (ii) the Condensed Consolidated Statements of Operations and Comprehensive Loss, (iii) the Condensed Consolidated Statements of Changes in Stockholders’ equity (iv) the Condensed Consolidated Statements of Cash Flows and (v) the Notes to Condensed Consolidated Financial Statements tagged as blocks of text.

*	Filed herewith

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SIGNATURES

Pursuant to 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.

	AVANT DIAGNOSTICS, INC.
Date: December 28, 2018	By:	/s/ Mick Ruxin
Date: January 9, 2019	By:	/s/ Mick Ruxin
		Mick Ruxin, M.D.
		Chief Executive Officer (Principal Executive Officer)
		Chief Executive Officer
		(Principal Executive Officer)

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Filing Compare · Avant Diagnostics, Inc