EOM Pharmaceutical Holdings, Inc. - Quarter Report: 2012 June (Form 10-Q)

Large accelerated filer

Accelerated Filer

Non-accelerated filer

Smaller reporting company

Form 10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

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

For the quarterly period ended June 30, 2012

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

Commission file number 001-35560

ImmunoCellular Therapeutics, Ltd.

(Exact name of registrant as specified in its charter)

DELAWARE

93-1301885

(State or other jurisdiction of

incorporation or organization)

(IRS Employer

Identification No.)

21900 Burbank Boulevard, 3^rd Floor

Woodland Hills, California 91367

(Address of principal executive offices)

(818) 992-2907

(Registrant’s telephone number, including area code)

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 x No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No ¨

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

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 Issuer had 40,620,796 shares of its common stock outstanding as of August 10, 2012.

ImmunoCellular Therapeutics, Ltd.

FORM 10-Q

Table of Contents


		Page
PART I FINANCIAL INFORMATION			3
Item 1.	Financial Statements		3
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		23
Item 3.	Quantitative and Qualitative Disclosures About Market Risk		26
Item 4.	Controls and Procedures		27
PART II OTHER INFORMATION			28
Item 1.	Legal Proceedings		28
Item 1A.	Risk Factors		28
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		28
Item 3.	Defaults Upon Senior Securities		28
Item 4.	Removed and Reserved		28
Item 6.	Exhibits		28
SIGNATURES			29
EXHIBIT LIST			30

PART 1

FINANCIAL INFORMATION

Item 1. Financial Statements

ImmunoCellular Therapeutics, Ltd.

(A Development Stage Company)

Condensed Balance Sheets


	June 30,			December 31,
	2012			2011
	(unaudited)
Assets
Current assets:
Cash and cash equivalents	$	11,339,843		$	6,653,168
Other assets		618,086			91,286

Total current assets		11,957,929			6,744,454

Property and equipment, net		95,064			76,402
Other assets
Deferred offering costs		0			282,599
Deposits		11,420			47,302

Total assets	$	12,064,413		$	7,150,757

Liabilities and Shareholders’ Equity
Current liabilities:
Accounts payable	$	573,675		$	1,316,540
Accrued liabilities		447,988			444,749

Total current liabilities		1,021,663			1,761,289

Warrant Liability		8,699,007			2,157,408

Commitments and contingencies (Note 5)

Shareholders’ equity:
Common stock, $0.0001 par value; 99,000,000 shares authorized; 40,411,792 shares and 28,613,984 shares issued and outstanding as of June 30, 2012 and December 31, 2011, respectively		4,041			2,861
Additional paid-in capital		45,354,645			31,902,890
Deficit accumulated during the development stage		(43,014,943	)		(28,673,691	)

Total shareholders’ equity		2,343,743			3,232,060

Total liabilities and shareholders’ equity	$	12,064,413		$	7,150,757

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

ImmunoCellular Therapeutics, Ltd.

(A Development Stage Company)

Condensed Statements of Operations

(Unaudited)


	For the Three			For the Three			For the Six			For the Six			February 25,
	Months Ended			Months Ended			Months Ended			Months Ended			2004 (Inception)
	June 30,			June 30,			June 30,			June 30,			to June 30,
	2012			2011			2012			2011			2012
Revenues	$	0		$	0		$	0		$	0		$	300,000

Expenses:
Research and development		2,189,633			858,183			4,188,169			1,775,397			14,737,048
Merger costs		0			0			0			0			73,977
Stock based compensation		103,617			391,858			348,724			633,839			8,568,729
General and administrative		837,322			579,889			1,643,120			1,133,610			10,634,600

Total expenses		3,130,572			1,829,930			6,180,013			3,542,846			34,014,354

Loss before other income (expense) and income taxes		(3,130,572	)		(1,829,930	)		(6,180,013	)		(3,542,846	)		(33,714,354	)
Interest income		1,975			1,009			3,009			2,645			342,144
Financing expense		0			0			(368,524	)		0			(368,524	)
Change in fair value of warrant liability		(3,323,220	)		278,096			(7,795,724	)		(768,895	)		(7,181,709	)

Loss before income taxes		(6,451,817	)		(1,550,825	)		(14,341,252	)		(4,309,096	)		(40,922,443	)
Income taxes		0			0			0			0			0

Net loss		(6,451,817	)		(1,550,825	)		(14,341,252	)		(4,309,096	)		(40,922,443	)
Deemed dividend on redemption of preferred stock		0			0			0			0			(2,092,500	)

Net loss attributable to common stock	$	(6,451,817	)	$	(1,550,825	)	$	(14,341,252	)	$	(4,309,096	)	$	(43,014,943	)

Loss per share	$	(0.16	)	$	(0.05	)	$	(0.37	)	$	(0.16	)	$	(2.89	)

Weighted average number of shares basic and diluted:		39,892,802			28,326,854			38,497,810			26,331,081			14,860,254

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

ImmunoCellular Therapeutics, Ltd.

(A Development Stage Company)

Condensed Statements of Shareholders’ Equity (Deficit)

(unaudited)


	Preferred Stock				Common Stock						Additional Paid-in			Promissory		Deficit Accumulated During the Development
	Shares		Amount		Shares			Amount			Capital			Note		Stage			Total
Initial capitalization at $0.00002 per share		0	$	0		6,256,500		$	10		$	87		$	0	$	0		$	97
Common stock issued for cash during 2004 at $0.00078 per share		0		0		193,500			15			135			0		0			150
Net loss		0		0		0			0			0			0		(11,741	)		(11,741	)

Balance at December 31, 2004		0		0		6,450,000			25			222			0		(11,741	)		(11,494	)
Common stock issued for cash during 2005 at $0.19 per share		0		0		387,000			659			74,341			0		0			75,000
Common stock issued for cash during 2005 at $0.32 per share		0		0		154,800			16			49,984			0		0			50,000
Common stock issued for research and development during 2005 at $0.99 per share		0		0		154,800			15			152,745			0		0			152,760
Net loss		0		0		0			0			0			0		(246,004	)		(246,004	)

Balance at December 31, 2005		0		0		7,146,600			715			277,292			0		(257,745	)		20,262
Common stock issued for services during 2006 at $0.50 per share		0		0		73,093			7			36,539			0		0			36,546
Common stock issued for cash during 2006 in private placements at $1.00 per share, net of redemptions		0		0		1,510,000			151			549,249			0		0			549,400
Common stock issued for research and development during 2006 at $1.00 per share		0		0		694,000			69			693,931			0		0			694,000
Shares issued in connection with reverse merger		0		0		825,124			83			(83	)		0		0			0
Shares cancelled in connection with the sale of Optical Molecular Imaging, Inc.		0		0		(2,059,100	)		(206	)		(64,794	)		0		0			(65,000	)
Exercise of stock options		0		0		10,062			1			3,521			0		0			3,522
Stock based compensation (options)		0		0		0			0			4,103,645			0		0			4,103,645
Net loss		0		0		0			0			0			0		(5,152,713	)		(5,152,713	)


Balance at December 31, 2006	0	0	8,199,779	820	5,599,300		0		(5,410,458	)	189,662
Common stock issued for cash during 2007 in private placements at $1.50 per share	0	0	3,531,603	353	4,892,133		0		0		4,892,486
Exercise of stock options	0	0	51,111	5	(5	)	0		0		0
Reclassification of warrant derivative liability	0	0	0	0	2,233,600		0		0		2,233,600
Stock based compensation (options)	0	0	0	0	1,296,714		0		0		1,296,714
Net loss	0	0	0	0	0		0		(3,614,753	)	(3,614,753	)

Balance at December 31, 2007	0	0	11,782,493	1,178	14,021,742		0		(9,025,211	)	4,997,709
Common stock issued for research and development during 2008 at $0.53 per share	0	0	800,000	80	423,920		0		0		424,000
Common stock issued for research and development during 2008 at $0.65 per share	0	0	100,000	10	64,990		0		0		65,000
Stock based compensation (options)	0	0	0	0	513,357		0		0		513,357
Net loss	0	0	0	0	0		0		(3,059,730	)	(3,059,730	)

Balance at December 31, 2008	0	0	12,682,493	1,268	15,024,009		0		(12,084,941	)	2,940,336
Exercise of warrants	0	0	1,970,992	197	462,551		0		0		462,748
Exercise of stock options	0	0	214,357	22	64,460		(52,668	)	0		11,814
Stock based compensation (options)	0	0	0	0	308,302		0		0		308,302
Net loss	0	0	0	0	0		0		(2,626,205	)	(2,626,205	)

Balance at December 31, 2009	0	0	14,867,842	1,487	15,859,322		(52,668	)	(14,711,146	)	1,096,995


Common stock and warrants issued for cash during 2010 at $1.00 per share, net of offering costs	0		0	4,230,910	423	3,248,315		0		0		3,248,738
Preferred stock and warrants issued for cash during 2010 at $10,000 per share, net of offering costs	400		0	0	0	0		0		0		0
Exercise of warrants in exchange for promissory note	0		0	2,700,000	270	5,399,730		(5,400,000	)	0		0
Redemption of preferred stock for repayment of promissory note	(400	)	0	0	0	0		5,400,000		(2,092,500	)	3,307,500
Exercise of stock options	0		0	50,000	5	26,495		0		0		26,500
Cashless exercise of stock options	0		0	297,156	30	(30	)	0		0		0
Common stock issued for services during 2010 at $0.90 per share	0		0	60,000	6	53,994		0		0		54,000
Common stock issued for services during 2010 at $1.06 per share	0		0	7,694	0	8,156		0		0		8,156
Stock based compensation	0		0	0	0	745,697		0		0		745,697
Interest on promissory note	0		0	0	0	0		(1,614	)	0		(1,614	)
Net loss	0		0	0	0	0		0		(6,150,142	)	(6,150,142	)

Balance at December 31, 2010	0		0	22,213,602	2,221	25,341,679		(54,282	)	(22,953,788	)	2,335,830
Common stock and warrants issued for cash during 2011 at $1.55 per share, net of offering costs	0		0	5,219,768	522	4,982,817		0		0		4,983,339
Exercise of stock options	0		0	382,000	38	388,341		0		0		388,379
Cashless exercise of stock options	0		0	667,077	67	(67	)	0		0		0
Stock based compensation	0		0	131,537	13	1,190,120		0		0		1,190,133
Interest on promissory note	0		0	0	0	0		(352	)	0		(352	)
Redemption of promissory note	0		0	0	0	0		54,634		0		54,634
Net loss	0		0	0	0	0		0		(5,719,903	)	(5,719,903	)

Balance at December 31, 2011	0		0	28,613,984	2,861	31,902,890		—		(28,673,691	)	3,232,060


Common stock and warrants issued for cash during 2012 at $1.10 per share, net of offering costs	0		0	9,489,436		949		9,270,421			0		0			9,271,370
Exercise of warrants	0		0	1,644,919		165		2,199,028			0		0			2,199,193
Reclassification of warrant liability upon exercise	0		0	0		0		1,622,648			0		0			1,622,648
Cashless exercise of warrants	0		0	214,639		21		(21	)		0		0			0
Cashless exercise of stock options	0		0	437,563		44		(44	)		0		0			0
Restricted stock vested	0		0	1,251		0		0			0		0			0
Stock based compensation	0		0	0		0		348,724			0		0			348,724
Exercise of stock options	0		0	10,000		1		10,999			0		0			11,000
Net loss	0		0	0		0		0			0		(14,341,252	)		(14,341,252	)

Balance at June 30, 2012	0	$	0	40,411,792	$	4,041	$	45,354,645		$	0	$	(43,014,943	)	$	2,343,743

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

ImmunoCellular Therapeutics, Ltd.

(A Development Stage Company)

Condensed Statements of Cash Flows

(Unaudited)


	For the Six Months Ended June 30, 2012			For the Six Months Ended June 30, 2011			February 25, 2004 (Inception) to June 30, 2012
Cash flows from operating activities:
Net loss	$	(14,341,252	)	($	4,309,096	)	($	40,922,443	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		22,888			8,016			52,350
Interest accrued on promissory note		0			1,264			0
Change in fair value of warrant liability		7,795,724			768,895			7,181,709
Financing expense		368,524			0			368,524
Stock-based compensation		348,724			633,839			8,506,573
Common stock issued for services		0			0			98,703
Common stock issued for research and development		0			0			1,335,760
Changes in assets and liabilities:								0
Other assets		(526,800	)		(16,226	)		(695,669	)
Accounts payable		(560,266	)		(108,414	)		573,325
Accrued liabilities		3,238			211,681			447,987

Net cash used in operating activities		(6,889,220	)		(2,810,041	)		(23,053,181	)

Cash flows from investing activities:
Purchase of property and equipment		(5,668	)		(37,925	)		(151,532	)
Cash paid for sale of Optical Molecular Imaging, Inc.		0			0			(25,000	)

Net cash used in investing activities		(5,668	)		(37,925	)		(176,532	)

Cash flows from financing activities:
Proceeds from exercise of stock options		11,000			162,679			441,213
Proceeds from exercise of warrants		2,199,193			0			2,661,941
Payments on promissory note receivable		0			53,018			53,018
Proceeds from issuance of common stock and warrants net of offering costs		9,371,370			7,460,129			27,508,979
Proceeds from issuance of preferred stock and warrants, net of offering costs		0			0			3,779,158
Proceeds from issuance of common stock		0			0			125,247

Net cash provided by financing activities		11,581,563			7,675,826			34,569,556

Increase in cash and cash equivalents		4,686,675			4,827,860			11,339,843
Cash and cash equivalents, beginning of period		6,653,168			5,319,776			0

Cash and cash equivalents, end of period	$	11,339,843		$	10,147,636		$	11,339,843

Supplemental cash flows disclosures:
Interest expense paid	$	0		$	0		$	0

Income taxes paid	$	0		$	0		$	0


Supplemental non-cash financing disclosures:
Exercise of warrants in exchange for promissory note	$	0	$	0	$	3,350,000

Redemption of preferred stock for repayment of promissory note	$	0	$	0	$	3,350,000

Deemed dividend on redemption of preferred stock	$	0	$	0	$	2,092,500

Warrant liability converted to additional paid-in capital	$	1,622,648	$	0	$	1,622,648

Deposits used to acquire property and equipment	$	35,882	$	0	$	35,882

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

ImmunoCellular Therapeutics, Ltd.

(A Development Stage Company)

Notes to Unaudited Condensed Financial Statements

1.	Nature of Organization and Development Stage Operations

ImmunoCellular Therapeutics, Ltd. (the Company) is a development stage company that is seeking to develop and commercialize new therapeutics to fight cancer using the immune system.

Since the Company’s inception on February 25, 2004, the Company has been primarily engaged in the acquisition of certain intellectual property, together with development of its product candidates and the recent clinical testing activities for one of its vaccine product candidates, and has not generated any recurring revenues. As of June 30, 2012, the Company is entering the 15^th month of the Phase II trial for ICT-107. The Company expanded the trial and also received a Japanese patent relating to a technology for the treatment of brain cancer, for which the Company holds an exclusive worldwide license. During the most recent quarter, the Company also received FDA approval for an investigational new drug on ICT-121. As a result, the Company has incurred operating losses and, as of June 30, 2012, the Company had an accumulated deficit of $43,014,943. The Company expects to incur significant research, development and administrative expenses before any of its products can be launched and recurring revenues generated.

Interim Results

The accompanying condensed financial statements at June 30, 2012 and for the three and six month periods ended June 30, 2012 and 2011 and for the period February 25, 2004 (inception) to June 30, 2012 are unaudited, but include all adjustments, consisting of normal recurring entries, which the Company’s management believes to be necessary for a fair presentation of the periods presented. Interim results are not necessarily indicative of results for a full year. Balance sheet amounts as of December 31, 2011 have been derived from our audited financial statements as of that date.

The financial statements included herein have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and note disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the U.S. have been condensed or omitted pursuant to such rules and regulations. The financial statements should be read in conjunction with the Company’s audited financial statements in its Form 10-K for the year ended December 31, 2011. The Company’s operating results will fluctuate for the foreseeable future. Therefore, period-to-period comparisons should not be relied upon as predictive of the results in future periods.

2.	Summary of Significant Accounting Policies

Development Stage Enterprise—The Company is a development stage enterprise and is devoting substantially all our present efforts to research and development. All losses accumulated since inception are considered part of the Company’s development stage activities.

Liquidity—As of June 30, 2012, the Company had working capital of $10,936,266, compared to working capital of $4,983,165 as of December 31, 2011. The Company believes that its existing cash balances are sufficient for the next twelve months. However, we will need additional capital to commercialize this product and to fund research of the Company’s other immunotherapy products. The Company believes that its existing cash balances are sufficient for its currently planned level of operations for at least the next twelve months, although there is no assurance that such proceeds will be sufficient for this purpose.

Cash and cash equivalents—The Company considers all highly liquid instruments with an original maturity of 90 days or less to be cash equivalents. As of June 30, 2012 and December 31, 2011, the Company had $10,491,322 and $6,238,313, respectively, of certificates of deposit. The Company places its cash and cash equivalents with high credit quality financial institutions. However, from time to time such cash balances may be in excess of the FDIC insurance limit of $250,000. As of June 30, 2012 the Company had $598,521 of deposits that were in excess of the FDIC insurance limit.

Property and Equipment—Property and equipment are stated at cost and depreciated using the straight-line methods based on the estimated useful lives (generally three to five years) of the related assets. Computer and computer equipment are depreciated over 3 years. Management continuously monitors and evaluates the realizability of recorded long-lived assets to determine whether their carrying values have been impaired. The Company records impairment losses on long-lived assets used in operations when events and circumstances indicate that the assets might be impaired and the nondiscounted cash flows estimated to be generated by those assets are less than the carrying amount of those assets. Any impairment loss is measured by comparing the fair value of the asset to its carrying amount. Repairs and maintenance costs are expensed as incurred.

Research and Development Expenses—Research and development expenses consist of costs incurred for direct research and development and are expensed as incurred.

Stock Based Compensation—The Company records the cost for all share-based payment transactions in the Company’s condensed financial statements.

Stock option grants issued prior to March 31, 2011 to employees and officers and directors were valued using the Black-Scholes pricing model. Stock option grants made subsequent to March 31, 2011 were valued using the binomial lattice simulation model. The following assumptions were used to value the grants:


	Six months	Six months
	Ended	Ended
	June 30,	June 30,
	2012	2011
Risk-free interest rate	0.84%	2.43%
Expected dividend yield	None	None
Expected life	5.17 years	6.8 years
Expected volatility	66.32%	57.90%
Expected forfeitures	0%	0%

The weighted-average grant-date fair value of options granted during the six months ended June 30, 2012 and 2011 was $1.78 and $1.02, respectively.

The risk-free interest rate used is based on the implied yield currently available in U.S. Treasury securities at maturity with an equivalent term. The Company has not declared or paid any dividends and does not currently expect to do so in the future. The expected term of options represents the period that our stock-based awards are expected to be outstanding and was determined based on projected holding periods for the remaining unexercised shares. Consideration was given to the contractual terms of our stock-based awards, vesting schedules and expectations of future employee behavior. Expected volatility is based on market prices of traded options for comparable entities within our industry. Forfeitures have been estimated to be nil.

The Company’s stock price volatility and option lives involve management’s best estimates, both of which impact the fair value of the option calculated and, ultimately, the expense that will be recognized over the life of the option.

When options are exercised, our policy is to issue previously unissued shares of common stock to satisfy share option exercises. As of June 30, 2012, the Company had approximately 38.6 million shares of authorized but unissued common stock.

No tax benefits were attributed to the stock-based compensation expense because a valuation allowance was maintained for substantially all net deferred tax assets.

Income Taxes—The Company accounts for federal and state income taxes under the liability method, with a deferred tax asset or liability determined based on the difference between the financial statement and tax basis of assets and liabilities, as measured by the enacted tax rates. The Company’s provision for income taxes represents the amount of taxes currently payable, if any, plus the change in the amount of net deferred tax assets or liabilities. A valuation allowance is provided against net deferred tax assets if recoverability is uncertain on a more likely than not basis. The Company recognizes in its financial statements the impact of an

uncertain tax position if the position will more likely than not be sustained upon examination by a taxing authority, based on the technical merits of the position. The Company’s policy is to recognize interest related to unrecognized tax benefits as interest expense and penalties as operating expenses. The Company is not currently under examination by any taxing authority nor has it been notified of an impending examination. The Company’s tax returns for the years ended December 31, 2011, 2010, 2009 and 2008 remain open for possible review.

Fair Value of Financial Instruments—The carrying amounts reported in the balance sheets for cash, cash equivalents, and accounts payable approximate their fair values due to their quick turnover. The fair value of warrant liability is estimated using the Binomial Lattice option valuation model.

Use of Estimates—The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make certain estimates and assumptions about the future outcome of current transactions which may affect the reporting and disclosure of these transactions. Accordingly, actual results could differ from those estimates used in the preparation of these financial statements.

Basic and Diluted Loss per Common Share—Basic and diluted loss per common share are computed based on the weighted average number of common shares outstanding. Common share equivalents (which consist of options and warrants) are excluded from the computation of diluted loss per share for the three and six months ended June 30, 2012 and the three and six months ended June 30, 2011, since the effect would be antidilutive. Common share equivalents which could potentially dilute basic earnings per share in the future, and which were excluded from the computation of diluted loss per share, totaled 20,013,824 shares and 41,655,680 shares at June 30, 2012 and 2011, respectively.

Recently Issued Accounting Standards—In May 2011, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2011-4, which amends the Fair Value Measurements Topic of the Accounting Standards Codification (ASC) to help achieve common fair value measurement and disclosure requirements in U.S. GAAP and IFRS. ASU No. 2011-4 does not require additional fair value measurements and is not intended to establish valuation standards or affect valuation practices outside of financial reporting. The ASU is effective for interim and annual periods beginning after December 15, 2011. The Company will adopt the ASU as required. The ASU will affect the Company’s fair value disclosures, but will not likely affect the Company’s results of operations, financial condition or liquidity.

In June 2011, the FASB issued ASU No. 2011-5, which amends the Comprehensive Income Topic of the ASC. The ASU eliminates the option to present the components of other comprehensive income as part of the statement of changes in shareholders’ equity, and instead requires consecutive presentation of the statement of net income and other comprehensive income either in a continuous statement of comprehensive income or in two separate but consecutive statements. ASU No. 2011-5 is effective for interim and annual periods beginning after December 15, 2011. The Company has adopted the ASU as required. It will likely have no affect on the Company’s results of operations, financial condition or liquidity.

Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the American Institute of Certified Public Accountants, and the Securities Exchange Commission (the “SEC”) did not or are not believed by management to have a material impact on the Company’s present or future condensed financial statements.

3.	Property and Equipment

Property and equipment consist of the following:


	June 30,			December 31,
	2012			2011
Computers	$	19,033		$	15,494
Research equipment		128,381			90,370

		147,414			105,864
Accumulated depreciation		(52,350	)		(29,462	)

	$	95,064		$	76,402

Depreciation expense was $11,444 and $3,603 for the three months ended June 30, 2012 and June 30, 2011, respectively. Depreciation expense was $22,888 and $8,016 for the six months ended June 30, 2012 and June 30, 2011, respectively. Depreciation expense was $52,350 for the period from February 25, 2004 (date of inception) to June 30, 2012.

4.	Related-Party Transactions

Cedars-Sinai Medical Center License Agreement

In November 2006, the Company entered into a license agreement with Cedars-Sinai Medical Center (“Cedars-Sinai”) under which the Company acquired an exclusive, worldwide license to its technology for use as cellular therapies, including cancer stem cell and dendritic cell-based vaccines for neurological disorders that include brain tumors and neurodegenerative disorders and other cancers. This technology is covered by a number of pending U.S. and foreign patent applications, and the term of the license will be until the last to expire of any patents that are issued covering this technology.

As an upfront licensing fee, the Company issued Cedars-Sinai 694,000 shares of its common stock and paid Cedars-Sinai $62,000. Additional specified milestone payments will be required to be paid to Cedars-Sinai when the Company initiates patient enrollment in its first Phase III clinical trial and when it receives FDA marketing approval for its first product.

The Company has agreed to pay Cedars-Sinai specified percentages of all of its sublicensing income and gross revenues from sales of products based on the licensed technology, subject to a reduction if it must make any payments to any third party whose proprietary rights would be infringed by sale of the products. To maintain its rights to the licensed technology, the Company must meet certain development and funding milestones. These milestones include, among others, commencing a Phase I clinical trial for a product candidate by March 31, 2007 and raising at least $5,000,000 in funding from equity or other sources by December 31, 2008. The Company satisfied the foregoing funding requirement in 2007 and commenced a Phase I clinical trial in May 2007, which was within the applicable cure period for the milestone requirement. Through December 31, 2009, the Company has paid Cedars-Sinai a total of $166,660 in connection with the Phase I clinical trial. The Company also was required to commence a Phase II clinical trial for a product candidate by December 31, 2008 and a waiver of this requirement was obtained from Cedars-Sinai (see Second Amendment below).

On June 16, 2008, the Company entered into a First Amendment to Exclusive License Agreement (the “Amendment”) with Cedars-Sinai. The Amendment amended the License Agreement to include in the Company’s exclusive license from Cedars-Sinai under that agreement an epitope to CD133 and certain related intellectual property. Management believes this technology will be covered by a U.S. patent application that will be filed by the parties. Pursuant to the Amendment, the Company issued Cedars-Sinai 100,000 shares of the Company’s common stock as an additional license fee for the licensed CD133 epitope technology, which will be subject to the royalty and other terms of the License Agreement.

On July 22, 2009, the Company entered into a Second Amendment to Exclusive License Agreement (the “Second Amendment”) with Cedars-Sinai to become effective August 1, 2009. The Second Amendment amended the License Agreement to revise the milestones set forth in the License Agreement that the Company must achieve in order to maintain its license rights under that agreement. The revised milestones include the replacement of a milestone that required commencement of a Phase II clinical trial for the Company’s first product candidate by no later than December 31, 2008 with milestones that require commencement of a Phase I clinical trial for the Company’s second product candidate by no later than June 30, 2010 and commencement of a Phase II clinical trial for one of the Company’s product candidates by no later than March 31, 2012.

Effective March 23, 2010, the Company entered into a Third Amendment to Exclusive License Agreement (the “Third Amendment”) with Cedars-Sinai. The Third Amendment amended the License Agreement to revise the milestones set forth in the License Agreement that the Company must achieve in order to maintain its license rights under that agreement. The revised milestones include the replacement of a milestone that required commencement of a Phase I clinical trial for the Company’s second product candidate by no later than June 30, 2010 and commencement of a Phase II clinical trial for one of the Company’s product candidates by no later than March 31, 2012 with a requirement that the Company by September 30, 2011 either commence a Phase II clinical trial for its dendritic cell vaccine candidate or a Phase I clinical trial for its cancer stem cell vaccine candidate. The amendment also added a requirement that the Company obtain certain defined forms of equity or other funding in the amount of at least $2,500,000 by December 31, 2010 and a total of at least $5,000,000 by September 30, 2011. These funding requirements were fully satisfied as of June 30, 2011.

5.	Commitments and Contingencies

Sponsored Research Agreements

In an effort to expand the Company’s intellection property portfolio to use antigens to create personalized vaccines, the Company has entered into various intellectual property and research agreements. Those agreements are long-term in nature and are discussed below.

Aptiv Solutions

The Company has contracted with Aptiv Solutions to provide certain services related to the Company’s ICT-107 Phase II trial. The original agreement was entered into in August of 2010 and provided for estimated payments of approximately $3 million for services through September 2013. Subsequently, the Company and Aptiv entered into two contract amendments. The first amendment occurred on January 20, 2011, whereby Aptiv agreed to provide additional services in conjunction with the Phase II trial of ICT-107 for an additional fee of $469,807. On February 4, 2012, the second amendment was finalized. This second amendment extended the services to be provided by Aptiv and further increased the fees by $986,783. The second amendment also extended the term of the agreement to March 31, 2014. The total aggregate fee pursuant to the original agreement and the two modifications is $4,463,631. Additionally, the Company has increased the patient sample size and it expects to incur additional charges by Aptiv relative to the increase in patient volume. The incremental cost is not yet known. As of June 30, 2012, the Company’s remaining obligation under the existing commitment is $1,596,939.

University of Pennsylvania

On February 13, 2012, the Company entered into a Patent License Agreement with The Trustees of the University of Pennsylvania under which the Company acquired an exclusive, world-wide license relating to patent technology for the production, use and cryopreservation of high-activity dendritic cell cancer vaccines, including ICT-107, its lead dentritic cell-based cancer vaccine candidate for the treatment of glioblastoma multiforme.

Pursuant to the License Agreement, the Company paid an upfront licensing fee and will be obligated to pay annual license maintenance fees. In addition, the Company has agreed to make payments upon completion of specified milestones and to pay royalties of a specified percentage on net sales, subject to a specified minimum royalty, and sublicensing fees.

The John Hopkins University Licensing Agreement

On February 23, 2012, the Company entered into an Exclusive License Agreement, effective as of February 16, 2012, with The John Hopkins University (JHU) under which it received an exclusive, world-wide license to JHU’s rights in and to certain patent-pending technology related to mesothelin-specific cancer immunotherapies.

Pursuant to the License Agreement, the Company agreed to pay an upfront licensing fee, payable half in cash and half in shares of its common stock, within 30 days of the effective date of the License Agreement and upon issuance of the first U.S. patent covering the subject technology. In addition, the Company has agreed to pay milestone license fees upon completion of specified milestones, customary royalties based on a specified percentage of net sales, sublicensing payments and annual minimum royalties.

The University of Pittsburgh Patent License Agreement

On March 20, 2012, the Company entered into an Exclusive License Agreement with the University of Pittsburgh under which the Company has licensed intellectual property surrounding EphA2, a tyrosine kinase receptor that is highly expressed by ovarian cancer and other advanced and metastatic malignancies. The License Agreement grants a world-wide exclusive license to the intellectual property for ovarian and pancreatic cancers; and a world-wide non-exclusive license to the intellectual property for brain cancer. The Company intends to employ the intellectual property in the development and commercialization of ICT-140, a multivalent, dendritic cell-based vaccine for the treatment of ovarian cancer.

Pursuant to the License Agreement, the Company agreed to pay an upfront nonrefundable and noncreditable licensing fee and nonrefundable and noncreditable maintenance fees due annually starting 12 months from the anniversary of the effective date of the License Agreement. In addition, the Company has agreed to make certain milestone payments upon completion of specified milestones and to pay customary royalties based on a specified percentage of net sales and sublicensing payments, as applicable.

In connection with the Cedars-Sinai Medical Center License Agreement, the Company has certain commitments as described in Note 4.

Employment Agreement with Dr. Manish Singh

On May 10, 2011, the Company entered into an Employment Agreement, effective as of February 18, 2011, with Dr. Manish Singh pursuant to which Dr. Singh will continue to serve on a full-time basis as the Company’s President and Chief Executive Officer for a one-year term commencing February 18, 2011. The Company is required under the Employment Agreement to use its commercially reasonable efforts to have Dr. Singh continue to serve as a member of the Company’s Board of Directors during the term of the Employment Agreement. The Employment Agreement automatically renews on the one-year anniversary date of the effective date of February 18, 2011 of each year thereafter for successive one-year terms unless terminated by either party. The Employment Agreement was automatically renewed on February 18, 2012.

The May 10, 2011 Employment Agreement provided for an annual base salary of $315,000. Upon the February 18, 2012 renewal, Dr. Singh’s annual base salary was increased to $330,750. In addition, provided that Dr. Singh continues to serve as the Company’s President and Chief Executive Officer for the entire one-year term of the Employment Agreement, the Company will pay Dr. Singh a discretionary cash bonus upon the attainment of certain corporate goals.

The Employment Agreement also provides Dr. Singh a seven-year incentive stock option grant to purchase 270,000 shares of common stock under the Company’s 2006 Equity Incentive Plan (the “Plan”) at an exercise price of $2.25 per share, which was the closing price of the Company’s common stock on the date of grant. The option will vest as follows; (i) 20,000 shares on February 17, 2012, (ii) 50,000 shares on February 17, 2013, (iii) 50,000 shares on February 17, 2014, (iv) 50,000 shares upon the Company attaining a market capitalization of at least $100 million for ten consecutive trading dates, (v) 50,000 shares upon the Company attaining a market capitalization of at least $150 million for ten consecutive trading days and (vi) 50,000 shares upon the Company attaining a market capitalization of at least $200 million for ten consecutive trading days. As of June 30, 2012, the Company achieved a market capitalization of at least $100 million for ten consecutive trading days and the first tranche of 50,000 shares became vested. The option may be exercised during the term that Dr. Singh provides services to the Company and for twelve months after termination for any reason except termination for cause by the Company, provided that such exercise is within the seven-year term of the option.

In the event that the Company terminates the Employment Agreement without cause, then (i) the Company upon such termination will be required to make a lump sum payment to Dr. Singh equal to six months of his base annual salary, (ii) any stock options granted to Dr. Singh, to the extent vested, will be retained by Dr. Singh and will be exercisable on the terms described above, and (3) the vesting of an additional number of shares subject to all options granted to Dr. Singh equal to 50% of all shares subject to such options that vest based solely on the passage of time and that have not already vested will immediately accelerate and will be exercisable on the terms described above. If Dr. Singh terminates his employment for “good reason” as defined in the Employment Agreement, he will receive the severance benefits described in the preceding sentence, except that 100% of his options will vest if his employment terminates for good reason following a merger or similar corporate transaction in which the Company is not the surviving entity and the surviving entity does not offer Dr. Singh an executive position at a compensation level at least equal to his then compensation under the Employment Agreement.

Employment Agreement with David Fractor

On April 4, 2011, the Company entered into an Employment Agreement with David Fractor pursuant to which Mr. Fractor will serve as the Company’s Treasurer and Chief Financial Officer on a part-time basis for a three-year term, subject to termination by either party on 30 days notice. Under this agreement, Mr. Fractor received a monthly salary of $6,000 and was granted a seven-year option to purchase 42,000 shares of the Company’s common stock at a price of $2.25 per share, with such option to vest in equal monthly installments over the three-year term of the agreement. On October 24, 2011, the Company increased Mr. Fractor’s monthly salary to $8,000 and the Company granted Mr. Fractor an additional 10,000 stock options with an exercise price of $1.42 per share, with such options to vest in equal annual installments over a four-year term. On February 24, 2012, the Company granted Mr. Fractor an additional 10,000 stock options with an exercise price of $1.90 per share, with such options to vest over a one-year term. Subsequent to June 30, 2012, the Company increased Mr. Fractor’s monthly salary to $12,000 effective August 1, 2012.

Employment Agreement with Dr. James Bender

On May 10, 2011, the Company entered into an Employment Agreement, effective as of February 1, 2011, with Dr. James Bender pursuant to which Dr. Bender will continue to serve on a full-time basis as the Company’s Vice President – Product Development and Manufacturing for a one-year term commencing February 1, 2011. The Employment Agreement automatically renews on the one-year anniversary date of the effective date of February 1, 2011 of each year thereafter for successive one-year terms unless terminated by either party. The Employment Agreement was automatically renewed on February 1, 2012.

The May 10, 2011 Employment Agreement provided for an annual base salary of $175,000. Upon the February 1, 2012 automatic renewal, Mr. Bender’s annual base salary was increased to $188,000. In addition, provided that Dr. Bender continues to serve as the Company’s Vice President—Product Development and Manufacturing for the entire one-year term of the Employment Agreement, the Company will pay Dr. Bender a discretionary cash bonus upon the attainment of certain corporate goals.

The Employment Agreement also provides Dr. Bender a seven-year incentive stock option grant to purchase 120,000 shares of common stock under the Plan at an exercise price of $2.25 per share, which was the closing price of the Company’s common stock on the date of grant. The option will vest as to (i) 60,000 shares in three annual installments of 20,000 shares each, with the first installment to vest on January 31, 2012; (ii) 20,000 shares upon the Company attaining a market capitalization of at least $100 million for ten consecutive trading dates; (iii) 20,000 shares upon the Company attaining a market capitalization of at least $150 million for ten consecutive trading dates; and (iv) 20,000 shares upon the Company attaining a market capitalization of at least $200 million for ten consecutive trading dates. As of June 30, 2012, the Company achieved a market capitalization of at least $100 million for ten consecutive trading days and the first tranche of 20,000 shares became vested. On June 11, 2012, the Company granted Dr. Bender a seven-year incentive stock option to purchase 75,000 shares of common stock under the Plan at an exercise price of $3.42, which was the closing price of the Company’s stock on the date of grant. The option will vest annual in four equal installments beginning on February 1, 2012. The option may be exercised during the term that Dr. Bender provides services to the Company and for twelve months after termination for any reason except termination for cause by the Company, provided that such exercise is within the seven-year term of the option.

In the event that the Company terminates the Employment Agreement without cause, then (i) the Company upon such termination will be required to make a lump sum payment to Dr. Bender equal to six months of his base annual salary, (ii) any stock options granted to Dr. Bender, to the extent vested, will be retained by Dr. Bender and will be exercisable on the terms described above, and (iii) the vesting of an additional number of shares subject to all options granted to Dr. Bender equal to 50% of all shares subject to such options that vest solely on the passage of time and that have not already vested will immediately accelerate and will be exercisable on the terms described above. If Dr. Bender terminates his employment for “good reason” as defined in the Employment Agreement, he will receive the severance benefits described in the preceding sentence, except that 100% of his options will vest if his employment terminates for good reason following a merger or similar corporate transaction in which the Company is not the surviving entity and the surviving entity does not offer Dr. Bender an executive position at a compensation level at least equal to his then compensation under the Employment Agreement.

Employment agreement with Peter Ho

Effective September 1, 2011, the Company entered into an Employment Agreement with Mr. Peter Ho pursuant to which Mr. Ho will serve on a full-time basis as the Company’s Director of Business Development and Technical Licensing for a one-year term commencing September 1, 2011. The Employment Agreement automatically renews on the anniversary date each year thereafter for successive one-year terms unless terminated by either party.

The Employment Agreement initially provided for an annual base salary of $130,000. Effective February 1, 2012, the Company increased Mr. Ho’s annual base salary to $135,200. In addition, provided that Mr. Ho continues to serve as the Company’s Director of Business Development and Technical Licensing for the entire one-year term of the Employment Agreement, the Company will pay Mr. Ho a discretionary cash bonus upon the attainment of certain corporate goals.

The Employment Agreement also provides Mr. Ho a seven-year incentive stock option grant to purchase 30,000 shares of common stock under the Plan at an exercise price of $1.41 per share, which was the closing price of the Company’s common stock on the date of grant. The option will vest in three equal annual installments. The option may be exercised during the term that Mr. Ho provides services to the Company and for three months after termination for any reason except termination for cause by the Company, provided that such exercise is within the seven-year term of the option.

Agreement with Dr. John Yu

On May 10, 2011, the Company entered into an Agreement, effective as of March 1, 2011, with Dr. John Yu pursuant to which Dr. Yu will continue to serve as the Company’s Chief Scientific Officer for a one-year term commencing March 1, 2011. The term of this Agreement will automatically renew on the one-year anniversary date of the Agreement each year after March 1, 2011 for successive one-year terms unless either party terminates. Dr. Yu may also terminate the Agreement at any time upon 60 days notice. On March 1, 2012, the Agreement was automatically renewed.

The May 10, 2011 Agreement provides for an annual base salary of $70,000. Effective March 1, 2012, the Company increased Dr. Yu’s annual base salary to $72,800. In addition, Dr. Yu will receive a bonus of $15,000 each (a maximum total of $30,000) upon and provided that the Company achieves each of the following milestones within one year from the March 1, 2011: (i) enrollment of 75 patients in the Phase II trial of ICT-107 and (ii) filing of an IND for either a new indication for ICT-107 or for another product candidate of the Company. The Company determined that Dr. Yu earned $23,250 of this potential bonus during 2011.

The Agreement also provides Dr. Yu a seven-year incentive stock option grant to purchase 50,000 shares of common stock under the Plan at an exercise price of $1.95 per share, which was the closing price of the Company’s common stock on the date of grant. The option will vest in three equal annual installments, with the first vesting date to be February 29, 2012. The option may be exercised during the term that Dr. Yu provides services to the Company and for twelve months after termination for any reason except termination without cause by Dr. Yu or termination for cause by the Company, provided that such exercise is within the seven-year term of the option. All of the options granted to Dr. Yu will vest if his services terminate following a merger or similar corporate transaction in which the Company is not the surviving entity and the surviving entity does not offer Dr. Yu an executive position at a compensation level at least equal to his then compensation level under the Agreement.

Operating Lease

The Company leased its office space through June 30, 2012 at a monthly rental of $3,493. Rent expense was approximately $12,700 and $12,000 for the three months ended June 30, 2012 and 2011 respectively. Rent expense was approximately $26,000 and $19,000 for the six months ended June 30, 2012 and 2011 respectively. Effective July 1, 2012, the Company renewed its lease for office space through June 30, 2013 at a monthly rental of $4,410.

6.	Shareholders’ Equity

Common Stock

In March 2010, the Company raised $1,654,686 (after commissions and offering expenses) from the sale of 1,740,000 shares of common stock and warrants to purchase 696,000 shares of common stock at an exercise price of $1.15 per share, to various investors in a private placement. (See “Warrants and Warrant Liabilities” below.)

In May 2010, the Company raised $2,716,308 (after commissions and offering expenses) from the sale of 2,490,910 shares of common stock and warrants to purchase 1,245,455 shares of common stock at an exercise price of $1.50 per share, to various investors in a private placement. (See “Warrants and Warrant Liabilities” below)

In February 2011, the Company raised $7,460,129 (after commissions and offering expenses) from the sale of 5,219,768 shares of common stock and warrants to purchase 2,609,898 shares of common stock at an exercise price of $2.25 per share, to various investors in a private placement. The warrants contain a provision whereby the warrant exercise price would be decreased in the event that certain future common stock issuances are made at a price less than $1.55. The January 2012 underwritten public offering (see below) provided for the issuance of shares at a price of $1.10. Accordingly, the exercise price of these warrants was adjusted to $1.90 and the number of warrants was proportionally increased to 3,337,849 (See “Warrants and Warrant Liabilities” below)

In January 2012, the Company raised approximately $9,271,370 in an underwritten public offering, net of offering expenses of approximately $1.1 million, from the sale of 9,489,436 shares of common stock and warrants to purchase 4,744,718 shares of common stock at an exercise price of $1.41 per share, to various investors in an underwritten public offering. The warrants have a term of 60 months from the date of issuance. The warrants do not contain any features (such as net cash settlement or anti-dilution features) that would preclude the Company from accounting for these warrants as equity. Accordingly, the warrants are accounted for as equity.

Stock Options

In February 2005, the Company adopted an Equity Incentive Plan (“Plan”). Pursuant to the Plan, a committee appointed by the Board of Directors may grant, at its discretion, qualified or nonqualified stock options, stock appreciation rights and may grant or sell restricted stock to key individuals, including employees, nonemployee directors, consultants and advisors. Option prices for qualified incentive stock options (which may only be granted to employees) issued under the plan may not be less than 100% of the fair market value of the common stock on the date the option is granted (unless the option is granted to a person who, at the time of grant, owns more than 10% of the total combined voting power of all classes of stock of the Company; in which case the option price may not be less than 110% of the fair market value of the common stock on the date the option is granted). Option prices for nonqualified stock options issued under the Plan are at the

discretion of the committee and may be equal to, greater or less than fair market value of the common stock on the date the option is granted. The options vest over periods determined by the Board of Directors and are exercisable no later than ten years from date of grant (unless they are qualified incentive stock options granted to a person owning more than 10% of the total combined voting power of all classes of stock of the Company, in which case the options are exercisable no later than five years from date of grant). Initially, the Company reserved 6,000,000 shares of common stock for issuance under the Plan. On October 24, 2011, the Company’s shareholders voted to increase the number of authorized shares reserved for the Plan to 8,000,000 shares. Options to purchase 3,304,154 common shares have been granted under the Plan and are outstanding as of June 30, 2012.

The following is a summary of stock option grants issued outside the Plan:

In January 2007, the Company granted an option to purchase 1,500,000 shares of its common stock at an exercise price of $1.10 per share to the Chairman of the Company’s Scientific Advisory Board.

In November 2006, the Company granted an option to purchase 300,000 shares of its common stock at an exercise price of $1.00 per share to an affiliate of the Company’s then Chairman of the Board.

In November 2006, the Company granted an option to purchase 5,933,424 shares of its common stock at an exercise price of $1.00 per share to a Board member in connection with the Cedars-Sinai license acquisition.

The following table summarizes stock option activity for the Company during the six months ended June 30, 2012:


				Weighted		Weighted
				Average		Average		Aggregate
				Exercise		Contractual		Intrinsic
	Options			Price		Term		Value
Outstanding December 31, 2011		10,774,078		$	1.07
Granted		217,500			3.18
Exercised		(654,000	)		1.01
Forfeited or expired		—			—

Outstanding June 30, 2012		10,337,578		$	1.12		4.5	$	27,164,922

Vested or expected to vest at June 30, 2012		9,517,335		$	1.02		4.2	$	25,978,393

As of June 30, 2012, the total unrecognized compensation cost related to unvested stock options amounted to $637,508, which will be amortized over the weighted-average remaining requisite service period of approximately 17 months.

Warrants

In connection with the May 2010 common stock private placement, the Company issued to the investors warrants to purchase 1,245,455 shares of the Company’s common stock at $1.50 per share. The warrants have a term of 36 months from the date of issuance. As of June 30, 2012, warrants to purchase 1,207,137 shares of the Company’s common stock were outstanding related to this private placement. (see Warrant Liabilities below)

In connection with the sale of Preferred Stock in May 2010, the Company issued warrants to purchase 1,350,000 shares of common stock at an exercise price of $2.50. The warrants have a term of five-years from the date of issuance. As of June 30, 2012, warrants to purchase 1,350,000 shares of the Company’s common stock at $2.50 were outstanding related to this private placement. (See “Warrant Liability” below.)

In connection with the February 2011 common stock private placement, the Company issued to the investors warrants to purchase 2,818,675 shares of the Company’s common stock at $2.25 per share. The warrants have a five-year term from the date of issuance and contain a provision that provides for an adjustment to the exercise price in the event the Company completes an equity financing at a per share price of its common stock that is less than $1.55. Since the January 2012, underwritten public offering provided for the sale of the Company’s common stock at a price of $1.10 per share, the exercise price of the February 2011 warrants was adjusted to $1.90 and the number of warrants outstanding increased to 3,337,849. As of June 30, 2012, warrants to purchase 2,953,286 shares of the Company’s common stock were outstanding related to this private placement. (See “Warrant Liability” below.)

In connection with the January 2012 underwritten public offering, the Company issued to the investors warrants to purchase 4,744,718 shares of the Company’s common stock at $1.41 per share. The warrants have a five-year term from the date of issuance. These warrants qualify for equity treatment since they do not have any provisions that would require the Company to redeem them for cash or that would result in an adjustment to the number of warrants. As of June 30, 2012, Warrants to purchase 4,110,992 shares of the Company’s common stock remain outstanding relating to this public offering.

Warrant Liability

The Company’s warrant liability is adjusted to fair value each reporting period and is influenced by several factors including the price of the Company’s common stock as of the balance sheet date. On June 30, 2012 the price per share of Company’s common stock was $3.75 per share compared to $1.36 per share at December 31, 2011 and $2.20 per share at June 30, 2011.

In connection with the March 2010 common stock private placement, the Company issued to the investors warrants to purchase 696,000 shares of the Company’s common stock at $1.15 per share. Of the total proceeds from the March 2010 common stock private placement, $257,520 was allocated to the freestanding warrants associated with the units based upon the fair value of the warrants determined under the Black Scholes option pricing model. The warrants contain a provision whereby the warrant exercise price would be decreased in the event that future common stock issuances are made at a price less than $1.00. Due to the potential variability of their exercise price, these warrants do not qualify for equity treatment, and therefore are recognized as a liability. The warrant liability was adjusted to fair value each reporting period, and any change in value is recognized in the statement of operations. Prior to 2011, the Company had concluded that Black-Scholes method of valuing the price adjustment feature does not materially differ from the valuation of such warrants using the lattice simulation model, and therefore, the use of the Black-Scholes valuation model was considered a reasonable method to value the warrants. The assumptions used in the Black Scholes model for determining the initial fair value of the warrants were as follows: (i) dividend yield of 0%; (ii) expected volatility of 102%, (iii) risk-free interest rate of 1.00%, and (iv) contractual life of 26 months. During the year ended December 31, 2011, the Company determined that it was more appropriate to value the warrants using a binomial lattice simulation model. The lattice simulation model used by the Company at June 30, 2011, assumed (i) dividend yield 0%; (ii) expected volatility of 69%; (iii) risk free rate of 0.18% and (iv) expected term of .92 years. Based upon this model, the Company recorded a charge to other expense of $261,000 and $180,960 for the three and six months ended June 30, 2011 respectively. During the six months ended June 30, 2012, the remaining warrants were fully exercised; however, the Company recognized an expense of $45,570 as the Company revalued the warrants at the date of exercised. For the three and six months ended June 30, 2012, the Company recorded a charge to other expense of $45,570 and $745,500, respectively.

In connection with the May 2010 common stock private placement, the Company issued to the investors warrants to purchase 1,245,455 shares of the Company’s common stock at $1.50 per share. Of the total proceeds from the May 2010 common stock private placement, $834,455 was allocated to the freestanding warrants associated with the units based upon the fair value of the warrants determined under the Black Scholes option pricing model. The warrants contain a provision whereby the warrant exercise price would be decreased in the event that future common stock issuances are made at a price less than $1.00. Due to the potential variability of their exercise price, these warrants do not qualify for equity treatment, and therefore are recognized as a liability. The warrant liability is adjusted to fair value each reporting period, and any change in value is recognized in the statement of operations. Prior to 2011, the Company concluded that the Black-Scholes method of valuing the price adjustment feature does not materially differ from the valuation of such warrants using the binomial lattice simulation models, and therefore, the use of the Black-Scholes valuation model was considered a reasonable method to value the warrants. The assumptions used in the Black Scholes model for determining the initial fair value of the warrants were as follows: (i) dividend yield of 0%; (ii) expected volatility of 102%, (iii) risk-free interest rate of 1.375%, and (iv) contractual life of 36 months. Effective January 1, 2011 the Company determined that it was more appropriate to value the warrants using a binomial lattice simulation model. The binomial lattice simulation model used by the Company at June 30, 2011, assumed (i) dividend yield of 0%; (ii) expected volatility of 68%; (iii) risk free rate of 0.43% and (iv) expected term of 1.92 years. Based upon this model, the Company recorded a credit to other income of $14,945 during the three months ended June 30, 2011 and a charge to other expense for $169,372 for the six months ended June 30, 2011. As of June 30, 2012, the Company revalued the warrants assuming (i) dividend yield of 0%; (ii) expected volatility of 60%; (iii) risk free rate of 0.18% and (iv) expected term of 0.92 years. For the three and six months ended June 30, 2012, the Company recorded a charge to other expense of $805,944 and $1,926,853 respectively. As of June 30, 2012, the carrying value of the warrant liability is $2,203,025.

In connection with the sale of Preferred Stock in 2010, the Company vested warrants to purchase 1,350,000 shares of the Company’s common stock at an exercise price of $2.50 per share. Of the total proceeds from the May 2010 preferred stock sale, $5,710,500 was allocated to the freestanding warrants associated with the units based upon the fair value of these warrants determined under the Black Scholes option pricing model. The warrants contain a provision whereby the warrant may be settled for cash in connection with a change of control with a private company. Due to the potential variability of their exercise price, these warrants do not qualify for equity treatment, and therefore are

recognized as a liability. The warrant liability is adjusted to fair value each reporting period and any change in value is recognized in the statement of operations. Prior to 2011 the Company concluded that the Black-Scholes method of valuing the price adjustment feature does not materially differ from the valuation of such warrants using the Monte Carlo or binomial lattice simulation models, and therefore, the use of the Black-Scholes valuation model was considered a reasonable method to value the warrants. The assumptions used in the Black Scholes model for determining the initial fair value of the warrants were as follows: (i) dividend yield of 0%; (ii) expected volatility of 102%, (iii) risk-free interest rate of 2.50%, and (iv) contractual life of 60 months. Effective January 1, 2011, the Company determined that it was more appropriate to value the warrants using a binomial lattice simulation model. The lattice simulation model used by the Company at June 30, 2011, assumed (i) dividend yield of 0%; (ii) expected volatility of 71%; (iii) risk free rate of 1.25% and (iv) expected term of 3.92 years. Based upon this model, the Company recorded a credit to other income of $163,350 during the three months ended June 30, 2011 and a charge to other expense of $51,300 for the six months ended June 30, 2011. As of June 30, 2012, the Company revalued the warrants using the binomial lattice simulation model assuming (i) dividend yield of 0%; (ii) expected volatility of 63%; (iii) risk free rate of 0.40% and (iv) expected term of 2.92 years. For the three and six months ended June 30, 2012, the Company recorded a charge to other expense of $658,800 and $1,451,250 respectively. As of June 30, 2012, the carrying value of the warrant liability is $1,911,600.

In connection with the February 2011 common stock private placement, the Company issued to the investors warrants to purchase 2,818,675 shares of the Company’s common stock at $2.25 per share. Of the total proceeds from the February 2011 common stock private placement, $2,476,790 was allocated to the freestanding warrants associated with the units based upon the fair value of the warrants determined under the Binomial lattice model. The warrants contain a provision whereby the warrant exercise price would be decreased in the event that certain future common stock issuances are made at a price less than $1.55. Due to the potential variability of their exercise price, these warrants do not qualify for equity treatment, and therefore are recognized as a liability. As a result of the January financing, the exercise price of these warrants was reduced to $1.90 and the number of warrants outstanding was increased by 519,174 to 3,337,849. The Company recorded a charge to financing expense of $368,524 to reflect the issuance of the additional warrants. The warrant liability is adjusted to fair value each reporting period, and any change in value is recognized in the statement of operations. The Company initially valued these warrants using a binomial lattice simulation model assuming (i) dividend yield of 0%; (ii) expected volatility of 146%; (iii) risk free rate of 1.96% and (iv) expected term of 5 years. Based upon those calculations, the Company calculated the initial valuation of the warrants to be $2,476,790. As of June 30, 2011, the Company revalued the warrants using the lattice simulation model assuming (i) dividend yield of 0%; (ii) expected volatility of 69%; (iii) risk free rate of 1.59% and (iv) expected term of 4.65 years. For the three months ended June 30, 2011, the Company recorded a credit to other income of $360,790 and for the six months ended June 30, 2011, the Company recorded a charge to other expense of $367,263. As of June 30, 2012, the Company revalued the warrants using the binomial lattice simulation model assuming (i) dividend yield of 0%; (ii) expected volatility of 63%; (iii) risk free rate of 0.51% and (iv) expected term of 3.65 years. For the three and six months ended June 30, 2012, the Company recorded a charge to other expense of $1,812,906 and $3,672,121 respectively. As of June 30, 2012, the carrying value of the warrant liability is $4,584,382.

The below table summarizes the warrant liability activity for the six months ended June 30, 2012 and 2011. The loss included in earnings is reflective of several factors including the increase in the Company’s stock during the six months ended June 30, 2012 and 2011.


	June 30, 2012			June 30, 2011
Beginning Balance	$	2,157,408		$	2,581,871
Issuance of warrants and effect of repricing		368,524			2,476,790
Exercise of warrants		(1,622,649	)		—
Loss included in earnings		7,795,724			768,895
Transfers in and/or out of Level 3		—			—

Ending Balance	$	8,699,007		$	5,827,556

7.	401(k) Profit Sharing Plan

During 2011, the Company adopted a Profit Sharing Plan that qualifies under Section 401(k) of the Internal Revenue Code. Contributions to the plan are at the Company’s discretion. The Company did not make any matching contributions during the three and six months ended June 30, 2012 and 2011.

8.	Income Taxes

Deferred taxes represent the net tax effects of the temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes. Temporary differences result primarily from the recording of tax benefits of net operating loss carry forwards and stock-based compensation.

As of June 30, 2012, the Company has an insufficient history to support the likelihood of ultimate realization of the benefit associated with the deferred tax asset. Accordingly, a valuation allowance has been established for the full amount of the net deferred tax asset.

The Company’s effective income tax rate differs from the amount computed by applying the federal statutory income tax rate to loss before income taxes as follows:


	June 30, 2012			June 30, 2011
Income tax benefit at the federal statutory rate		-34	%		-34	%
State income tax benefit, net of federal tax benefit		-6	%		-6	%
Change in fair value of warrant liability		23	%		7	%
Change in valuation allowance for deferred tax assets		17	%		33	%

Total		0	%		0	%


	June 30, 2012			December 31, 2011
Net operating loss carryforwards	$	11,746,941		$	8,274,061
Stock-based compensation		2,913,368			2,730,729
Less valuation allowance		(14,660,309	)		(11,004,790	)

Net deferred tax asset	$	—		$	—

As of June 30, 2012, the Company had federal and California income tax net operating loss carryforwards of approximately $26,031,000 and $26,791,000, respectively. These net operating losses will begin to expire in 2022 and 2016, respectively, unless previously utilized.

Section 382 of the Internal Revenue Code can limit the amount of net operating losses which may be utilized if certain changes to a company’s ownership occur. The Company is in the process of evaluating whether such changes in ownership occurred, and its effect on the utilization of its loss carryforwards.

9.	Subsequent Events

Warrant exercises

Subsequent to June 30, 2012, certain warrant holders exercised 209,400 warrants for cash and the Company received $359,010.

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Throughout this Quarterly Report on Form 10-Q, the terms “we,” “us,” “our,” and “our company” refer to ImmunoCellular Therapeutics, Ltd., a Delaware corporation.

Cautionary Statement Regarding Forward-Looking Statements

This Quarterly Report contains forward-looking statements, which reflect the views of our management with respect to future events and financial performance. These forward-looking statements are subject to a number of uncertainties and other factors that could cause actual results to differ materially from such statements. Forward-looking statements are identified by words such as “anticipates,” “believes,” “estimates,” “expects,” “plans,” “projects,” “targets” and similar expressions. Readers are cautioned not to place undue reliance on these forward-looking statements, which are based on the information available to management at this time and which speak only as of this date. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. For a discussion of some of the factors that may cause actual results to differ materially from those suggested by the forward-looking statements, please read carefully the information in the “Risk Factors” section in our Form 10-K for the year ended December 31, 2011. The identification in this Quarterly Report of factors that may affect future performance and the accuracy of forward-looking statements is meant to be illustrative and by no means exhaustive. All forward-looking statements should be evaluated with the understanding of their inherent uncertainty.

Overview

On January 31, 2006, we completed a merger pursuant to which Spectral Molecular Imaging, Inc. became our wholly owned subsidiary. At the time of the merger, we had virtually no assets or liabilities, and we had not conducted any business operations for several years. In connection with the merger, we changed our name from Patco Industries, Ltd. to Optical Molecular Imaging, Inc. and replaced our officers and directors with those of Spectral Molecular Imaging. Although we acquired Spectral Molecular Imaging in the merger, for accounting purposes the merger was treated as a reverse merger since the stockholders of Spectral Molecular Imaging acquired a majority of our outstanding shares of common stock and the directors and executive officers of Spectral Molecular Imaging became our directors and executive officers. Accordingly, our financial statements contained in this Annual Report and the description of our results of operations and financial condition reflect the operations of Spectral Molecular Imaging.

In May 2006, we decided to suspend our research and development activities on Spectral Molecular Imaging’s spectral imaging technology, and on September 11, 2006, we sold all of the outstanding capital stock of Spectral Molecular Imaging to Dr. Daniel Farkas, a co-founder of Spectral Molecular Imaging and inventor of its technology.

In November 2006, we acquired an exclusive, worldwide license from Cedars-Sinai Medical Center for certain cellular-based therapy technology that we are developing for the potential treatment of brain tumors and other forms of cancer and neurodegenerative disorders. We recently completed a Phase I clinical trial of a vaccine product candidate for the treatment of glioblastoma multiforme based on this technology.

In February 2008, we acquired certain monoclonal antibody related technology owned by Molecular Discoveries LLC. This technology consists of (1) a platform technology referred to by Molecular Discoveries as DIAAD for the potentially rapid discovery of targets (antigens) and monoclonal antibodies for diagnosis and treatment of diverse human diseases and (2) certain monoclonal antibody candidates for the potential detection and treatment of multiple myeloma, small cell lung, pancreatic and ovarian cancers.

Plan of Operation

We are a development stage company that is seeking to develop and commercialize new therapeutics to fight cancer using the immune system. Presently, the Company’s activities are primarily focused on the testing of ICT-107, which is a cancer immune therapy to treat glioblastoma multiforme. The Company is also in the pre-clinical development stage to develop two additional therapies to treat ovarian and solid tumor cancers.

Since our company’s inception on February 25, 2004, we have been primarily engaged in the acquisition of certain intellectual property, together with the recent clinical testing activities for one of our vaccine product candidates, and have not generated any recurring revenues. As a result, we have incurred operating losses and, as of June 30, 2012, we had an accumulated deficit of $43,014,943. We expect to incur significant research, development and administrative expenses before any of our products can be launched and recurring revenues, if ever, are generated.

Critical Accounting Policies

Management’s discussion and analysis of our financial condition and results of operations are based on our financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires management to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. On an ongoing basis, management evaluates its estimates, including those related to impairment of long-lived assets, including finite lived intangible assets, accrued liabilities and certain expenses. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ materially from these estimates under different assumptions or conditions.

Our significant accounting policies are summarized in Note 2 of our financial statements for the period from February 25, 2004 to June 30, 2012. We believe the following critical accounting policies affect our more significant judgments and estimates used in the preparation of our financial statements:

Development Stage Enterprise

We are a development stage enterprise as defined by FASB ASC Topic 915, “Development Stage Enterprises.” We are devoting substantially all of our present efforts to research and development. All losses accumulated since inception are considered as part of our development stage activities.

Research and Development Costs

Although we believe that our research and development activities and underlying technologies have continuing value, the amount of future benefits to be derived from them is uncertain. Research and development costs are therefore expensed as incurred rather than capitalized. During the six months ended June 30, 2012 and 2011, we recorded an expense of $4,188,169 and $1,775,397, respectively, related to research and development activities.

Stock-Based Compensation

We recognize in our condensed consolidated financial statements the cost resulting from all share-based compensation transactions, including grants of stock options and restricted stock awards, based on their fair values on the measurement date, and recognized over the vesting period in accordance with FASB ASC Topic 718, “Compensation-Stock Based.” We use the Black-Scholes option pricing model to estimate the value of our options. Our assessment of the estimated compensation charges will be affected by our stock price as well as assumptions regarding a number of subjective variables and the related tax impact. These variables include, but are not limited to, our stock price volatility, forfeiture rates and employee stock option exercise behaviors (or expected term).

Results of Operations

Three months ended June 30, 2012 and 2011

Revenues

We had no revenues during the three months ended June 30, 2012 and 2011. We do not expect to generate any operating revenues during 2012.

Expenses

General and administrative expenses for the three months ended June 30, 2012 and 2011 were $837,322 and $579,889, respectively. The increase in expenses reflects the expansion of our infrastructure during the latter half of 2011 including the hiring of additional personnel. Additionally, we incurred additional expenses in the areas of investor relations, travel and professional fees.

Research and development expenses for the three months ended June 30, 2012 and 2011 were $2,189,633 and $858,183, respectively. Research and development expenses consist primarily of our Phase II clinical trial of ICT-107. During the three months ended June 30, 2011, we had only started to enroll patients in our ICT-107 Phase II clinical trial and a total of 9 patients were enrolled. During the three months ended June 30, 2012, we enrolled 72 new patients in the trial bringing the total number of enrolled patients to 231. Additionally, as of June 30, 2012, we have two manufacturing facilities and 25 Phase II trial clinical sites that are operational.

We had $3,438,281 of non-cash expenses during the three months ended June 30, 2012, consisting of $103,617 of stock based compensation, $3,323,220 of change in the fair value of warrant derivatives and $11,444 of depreciation expense. The change in fair value of warrant derivative is highly influenced by the price of our Company’s common stock as of June 30, 2012. As of June 30, 2012, the price of our common stock increased to $3.75 per share. During the three months ended June 30, 2011, we had non-cash expenses of $395,461 consisting of $391,858 of stock based compensation and $3,603 of depreciation expense. During the three months ended June 30, 2011, we also received a benefit for the change in the fair value of the warrant derivatives in the amount of $278,096.

Loss

We incurred a net loss of $6,451,817 and $1,550,825 for the three months ended June 30, 2012 and 2011, respectively.

Six months ended June 30, 2012 and 2011

Revenues

We had no revenues during the six months ended June 30, 2012 and 2011. We do not expect to generate any operating revenue during 2012.

Expenses

General and administrative expenses for the six months ended June 30, 2012 and 2011 were $1,643,120 and $1,133,610, respectively. The increase in expenses reflects the expansion of our infrastructure during the latter half of 2011 including the hiring of additional personnel. Additionally, we incurred additional expenses in the areas of investor relations, travel and board fees.

Research and development expenses for the six months ended June 30, 2012 and 2011 were $4,188,169 and $1,775,397 respectively. Research and development expenses consist primarily of our Phase II clinical trial of ICT-107. During the six months ended June 30, 2011, we had only started to enroll patients in our ICT-107 Phase II clinical trial and a total of 14 patients were enrolled. During the six months ended June 30, 2012, we enrolled 140 new patients in the trial bringing the total number of enrolled patients to 231. Additionally, as of June 30, 2012, we have two manufacturing facilities and 25 Phase II trial clinical sites that are operational.

The warrants issued as part of the February 2011 financing contained a provision whereby the exercise price of those warrants, and the number of underlying warrants, would be adjusted in the event that we subsequently sold shares of our common stock at a price that was less than $1.55 per share. As part of the January 2012 financing, we sold shares of its common stock at a price that was less than $1.55 per share and the exercise price of the February 2011 warrants was decreased from $2.25 to $1.90 and the number of warrants outstanding was increased by 519,174. We recorded a non-cash financing expense charge of $368,524 during the six months ended June 30, 2012 to account for the issuance of these additional warrants. There was no comparable charge during the six months ended June 30, 2012.

During the six months ended June 30, 2012, we incurred $8,167,336 of non-cash expenses, consisting of $348,724 of stock based compensation, $7,795,724 of change in fair value of warrant derivatives and $22,888 of depreciation expense. The change in fair value of warrant derivative is highly influenced by the price of our Company’s common stock as of June 30, 2012. As of June 30, 2012, the price of our common stock increased to $3.75 per share. During the six months ended June 30, 2011, we incurred $1,410,750 of non-cash expenses consisting of $633,839 of stock based compensation, $768,895 of change in fair value of warrant derivatives and $8,016 of depreciation expense.

Loss

We incurred a net loss of $14,341,252 and $4,309,096 for the six months ended June 30, 2012 and 2011, respectively.

Liquidity and Capital Resources

As of June 30, 2012, we had working capital of $10,936,266 compared to working capital of $4,893,165 as of December 31, 2011.

The estimated cost of completing the development of either of our current vaccine product candidates and of obtaining all required regulatory approvals to market either of those product candidates is substantially greater than the amount of funds we currently have available. However, we believe that our existing cash balances will be sufficient to fund our operations for the next twelve months, although there is no assurance that such proceeds will be sufficient.

We do not have any bank credit lines. In January 2012, we completed a $9,271,370 underwritten public offering of 9,489,436 units at a price of $1.10 per unit. Each unit consists of one share of stock and a warrant to purchase 0.5 of a share of our common stock at an exercise price of $1.41 per share. In February 2011, we completed an $8,090,644 private placement, before commissions and costs, of 5,219,768 units at a price of $1.55 per unit, with each unit consisting of one share of our common stock and a warrant to purchase 0.5 of a share of our common stock at an exercise price of $2.25 per share. We may also in the future seek to obtain funding through strategic alliances with larger pharmaceutical or biomedical companies. We cannot be sure that we will be able to obtain any additional funding from either financings or alliances, or that the terms under which we may be able to obtain such funding will be beneficial to us. If we are unsuccessful or only partly successful in our efforts to secure additional financing, we may find it necessary to suspend or terminate some or all of our product development and other activities.

As of June 30, 2012, we had no long-term debt obligations, no capital lease obligations, or other similar long-term liabilities. We have various purchase commitments for sponsored research and license fees. We have no financial guarantees, debt or lease agreements or other arrangements that could trigger a requirement for an early payment or that could change the value of our assets, and we do not engage in trading activities involving non-exchange traded contracts.

The following is a summary of our contractual obligations as of June 30, 2012:


			2013 to		2014 to		Beyond
	2012		2014		2015		2015
Unconditional purchase obligations		481,268		1,012,537		228,134		—
Operating lease obligation		26,460		26,460		—		—

Cash Flows

We used $6,889,220 of cash in our operations for the six months ended June 30, 2012, compared to $2,810,041 for the six months ended June 30, 2011. During the six months ended June 30, 2012, we greatly expanded our research and development activities, hired additional personnel and expanded our investor relations programs. Additionally, we expanded our manufacturing activities, purchased the rights to key antigens and initiated efforts to expand our intellectual property portfolio. We also incurred greater non-cash expenses consisting primarily of a valuation adjustment to our warrant liabilities of $7,795,724 compared to $768,895 in the same period last year. Additionally, during the six months ended June 30, 2012, we recorded a non-cash financing expense of $368,724 related to the issuance of additional warrants triggered by the January 2012 stock issuance.

We used $5,668 of cash from our investing activities for the six months ended June 30, 2012 to acquire office equipment. During the six months ended June 30, 2011, we purchased $37,925 of machinery to support our research and development activities.

During the six months ended June 30, 2012, we received net proceeds of $9,371,370, from the issuance of common stock and warrants and we received $2,199,193 of proceeds from the exercise of warrants. During the six months ended June 30, 2011, we received net proceeds of $7,460,129 from the issuance of common stock and warrants. Additionally, during the six months ended June 30, 2011, we received $162,679 from the exercise of stock options and we received $53,018 from payments received on a promissory note receivable.

Inflation and changing prices have had no effect on our net sales and revenues or on our income from continuing operations over our two most recent fiscal years.

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Not Applicable.

Item 4.

Controls and Procedures

As of the end of the fiscal quarter covered by this report, we carried out an evaluation, under the supervision and with the participation of our principal executive officer and principal financial officer, regarding the effectiveness of the design and operation of our disclosure controls and procedures pursuant to SEC Rule 15d-15(b) of the Exchange Act. Based upon that evaluation, our principal executive officer and principal financial officer concluded that, as of June 30, 2012, (i) our disclosure controls and procedures were effective to ensure that information that is required to be disclosed by us in reports that we file under the Exchange Act is recorded, processed, summarized and reported or submitted within the time period specified in the rules and forms of the SEC and (ii) our disclosure controls and procedures were effective to provide reasonable assurance that material information required to be disclosed by us in the reports we file or submit under the Exchange Act was accumulated and communicated to our management as appropriate to allow timely decisions regarding required disclosure. There were no changes in our internal control over financial reporting that occurred during the period covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

We do not expect that our disclosure controls and procedures and internal control over financial reporting will prevent all error and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within our company have been detected. The design of any system of controls also is based in part upon assurance that any design will succeed in achieving its stated goals under all potential future conditions. However, controls may become inadequate because of changes in conditions or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

PART II

OTHER INFORMATION

Item 1.

Legal Proceedings

None.

Item 1A.

Risk Factors

Not applicable.

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

None

Item 3.

Defaults Upon Senior Securities

None.

Item 4.

Removed and Reserved

Item 5.

Other Information

None.

Item 6.

Exhibits


Exhibit No.		Description

10.1		Office Lease dated July 1, 2012 between Regent Business Center and ImmunoCellular Therapeutics, Ltd.

31.1		Certification of the Registrant’s Principal Executive Officer under Exchange Act Rule 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2		Certification of the Registrant’s Principal Financial Officer under Exchange Act Rule 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1		Certification of the Registrant’s Principal Executive Officer under 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2		Certification of the Registrant’s Principal Financial Officer under 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101		The following financial information from the Quarterly Report on Form 10-Q of ImmunoCellular Therapeutics, Ltd. for the quarter ended June 30, 2012, formatted in XBRL (eXtensible Business Reporting Language): (1) Condensed Balance Sheets as of June 30, 2012 and December 31, 2011; (2) Condensed Statements of Operations for the three and six months ended June 30, 2012 and 2011 and for the period from February 25, 2004 (inception) to June 30, 2012; (3) Condensed Statements of Shareholders’ Equity for the period from 2004 to June 30, 2012; (4) Condensed Statements of Cash Flows for the six months ended June 30, 2012 and 2011 and for the period from February 25, 2004 (inception) to June 30, 2012; and (5) Notes to Unaudited Condensed Financial Statements.*

Pursuant to Rule 406T of Regulation S-T, the information in Exhibit 101(a) is “furnished” and is not deemed to be “filed” or part of a registration statement or prospectus for purposes of Section 11 or 12 of the Securities Act of 1933, as amended, (b) is deemed not to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and (c) is not otherwise subject to liability under those sections.

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.


Dated: August 13, 2012	IMMUNOCELLULAR THERAPEUTICS, LTD.

	By:	/s/ Manish Singh, Ph.D.
		Name: Manish Singh, Ph.D.
		Title: President and Chief Executive Officer (Principal Executive Officer)

EXHIBIT INDEX

IMMUNOCELLULAR THERAPEUTICS, LTD.

FORM 10-Q FOR QUARTER ENDED JUNE 30, 2012


Exhibit No.		Description

10.1		Office Lease dated July 1, 2012 between Regent Business Center and ImmunoCellular Therapeutics, Ltd.

31.1		Certification of the Registrant’s Principal Executive Officer under Exchange Act Rule 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31 .2		Certification of the Registrant’s Principal Financial Officer under Exchange Act Rule 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1		Certification of the Registrant’s Principal Executive Officer under 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2		Certification of the Registrant’s Principal Financial Officer under 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101		The following financial information from the Quarterly Report on Form 10-Q of ImmunoCellular Therapeutics, Ltd. for the quarter ended June 30, 2012, formatted in XBRL (eXtensible Business Reporting Language): (1) Condensed Balance Sheets as of June 30, 2012 and December 31, 2011; (2) Condensed Statements of Operations for the three and six months ended June 30, 2012 and 2011 and for the period from February 25, 2004 (inception) to June 30, 2012; (3) Condensed Statements of Shareholders’ Equity for the period from 2004 to June 30, 2012; (4) Condensed Statements of Cash Flows for the six months ended June 30, 2012 and 2011 and for the period from February 25, 2004 (inception) to June 30, 2012; and (5) Notes to Unaudited Condensed Financial Statements.*

Pursuant to Rule 406T of Regulation S-T, the information in Exhibit 101 (a) is “furnished” and is not deemed to be “filed” or part of a registration statement or prospectus for purposes of Section 11 or 12 of the Securities Act of 1933, as amended, (b) is deemed not to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and (c) is not otherwise subject to liability under those sections.