Sunshine Biopharma, Inc - Quarter Report: 2015 June (Form 10-Q)

sbfm_10q.htm

U.S. SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

Form 10-Q

Quarterly Report Under

the Securities Exchange Act of 1934

For Quarter Ended: June 30, 2015

Commission File Number: 000-52898

SUNSHINE BIOPHARMA INC.

(Exact name of small business issuer as specified in its charter)

Colorado		20-5566275
(State of other jurisdiction of incorporation)		(IRS Employer ID No.)

469 Jean-Talon West

3rd Floor

Montreal, Quebec, Canada H3N 1R4

(Address of principal executive offices)

(514) 764-9698

(Issuer’s Telephone Number)

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 þ No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes þ No o

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

Large accelerated filer	o	Accelerated filer	o

Non-accelerated filer	o	Smaller reporting company	þ
(Do not check if a smaller reporting company)

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

The number of shares of the registrant’s only class of Common Stock issued and outstanding as of August 6, 2015, was 129,290,768 shares.

TABLE OF CONTENTS

PART I.

FINANCIAL INFORMATION

		Page No.

Item 1.	Financial Statements	3
	Unaudited Consolidated Balance Sheet as of June 30, 2015	3
	Unaudited Statement of Operations for the Three and Six Month Periods Ended June 30, 2015	4
	Unaudited Consolidated Statement of Cash Flows for the for the Three and Six Month Periods Ended June 30, 2015	5
	Notes to Unaudited Consolidated Financial Statements	6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations/Plan of Operation.	9
Item 3.	Quantitative and Qualitative Disclosures About Market Risk.	16
Item 4.	Controls and Procedures.	16

PART II
OTHER INFORMATION

Item

Item 1.	Legal Proceedings	16
Item 1A.	Risk Factors	17
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	17
Item 3.	Defaults Upon Senior Securities	17
Item 4.	Mine Safety Disclosures	17
Item 5.	Other Information	17
Item 6.	Exhibits	17
	Signatures	18

Sunshine Biopharma, Inc.
Consolidated Balance Sheet

	Unaudited			Audited
	June 30,			December 31,
	2015			2014
ASSETS

Current Assets:

Cash and cash equivalents	$	157,227		$	143,423
Accounts receivable		1,933			-
Prepaid expenses		11,588			-

Total Current Assets		170,748			143,423


TOTAL ASSETS	$	170,748		$	143,423

LIABILITIES AND SHAREHOLDERS' EQUITY
Commitments and Contingencies
Current Liabilities:

Current portion of note payable		390,640			480,124
Accounts payable		35,667			34,766
Interest payable		9,759			16,113

TOTAL LIABILITIES		436,066			531,003


SHAREHOLDERS' (Deficit)

Preferred stock, Series A $0.10 par value per share;
Authorized 5,000,000 Shares; Issued
and outstanding -0- shares.		-			-

Preferred stock, Series B $0.10 par value per share;
Authorized 500,000 Shares; Issued
and outstanding 500,000 shares.		50,000

Common Stock, $0.001 per share;
Authorized 200,000,000 Shares; Issued
and outstanding 126,472,450 and 73,551,041 at
June 30, 2015 and December 31, 2014 respectively		126,472			73,551

Capital paid in excess of par value		7,794,091			6,967,228
Accumulated comprehensive income		4,357			-
Accumulated (Deficit)		(8,240,238	)		(7,428,359	)

TOTAL SHAREHOLDERS' EQUITY		(265,318	)		(387,580	)

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	$	170,748		$	143,423

See Accompanying Notes To These Financial Statements.

Sunshine Biopharma, Inc.
Unaudited Consolidated Statement Of Operations


	Unaudited			Unaudited			Unaudited			Unaudited
	3 Months			3 Months			6 Months			6 Months
	Ended			Ended			Ended			Ended
	June 30,			June 30,			June 30,			June 30,
	2015			2014			2015			2014

Revenue:	$	1,708		$	-		$	1,708		$	-

General & Administrative Expenses

Accounting		52,160			32,020			57,560			37,200
Consulting		81,421			60,000			101,421			326,000
Legal		34,391			169,405			77,242			214,777
Licenses		144,108			70,000			194,108			153,333
Office		2,300			7,983			5,724			12,889
Officer renumeration		50,000			-			50,000			-
Public Relations		-			100,000			-			100,000
Research and Development		-			323,000			-			323,000
Stock Transfer Fee		5,485			3,105			8,635			4,188

Total G & A		369,865			765,513			494,690			1,171,387

(Loss) from operations	$	(368,157	)	$	(765,513	)		(492,982	)		(1,171,387	)

Other (expense):
Interest expense		(33,226	)		(95,382	)		(39,431	)		(148,257	)
Loss on debt conversions		(116,129	)		-			(279,466	)		-

Total Other (Expense)		(149,355	)		(95,382	)		(318,897	)		(148,257	)

Net (loss)	$	(517,512	)	$	(765,513	)	$	(811,879	)	$	(1,319,644	)

Basic (Loss) per common share		(0.00	)		(0.01	)	$	(0.01	)	$	(0.02	)

Weighted Average Common Shares Outstanding		119,908,405			65,468,255			99,538,757			63,309,853

Net Income (Loss)	$	(517,512	)	$	(765,513	)	$	(811,879	)	$	(1,319,644	)
Other comprehensive income:
Gain from foreign exchange transactions		4,357			-			4,357			-
Comprehensive income (Loss)		(513,155	)		(765,513	)		(807,522	)		(1,319,644	)

Basic (Loss) per common share		(0.00	)		(0.01	)	$	(0.01	)	$	(0.02	)

Weighted Average Common Shares Outstanding		119,908,405.05			65,468,255.00			99,538,757.15			63,309,853.00

See Accompanying Notes To These Financial Statements.

Sunshine Biopharma, Inc.
Unaudited Consolidated Statement Of Cash Flows

	Unaudited			Unaudited
	6 Months			6 Months
	Ended			Ended
	June 30,			June 30,
	2015			2014
Cash Flows From Operating Activities:


Net (Loss)	$	(811,879	)	$	(1,319,644	)

Adjustments to reconcile net loss to net cash used in
operating activities:

Stock issued for licenses, services, and other assets		116,500			860,800
Stock issued for payment interest		3,180			75,000
Loss on debt conversion		288,931
Stock issued for payment of expenses		-			43,333
Gain on foreign exchange transactions		4,357
(Increase) in accounts receivable		(1,933	)
(Increase) in prepaid expenses		(11,589	)		(5,640	)
Increase in Accounts Payable		901			70,065
Increase (decrease) in interest payable		(6,354	)		3,257

Net Cash Flows (used) in operations		(417,886	)		(272,829	)

Cash Flows From Investing Activities:


Net Cash Flows (used) in Investing activities		-			-

Cash Flows From Financing Activities:

Proceed from note payable		152,840			160,000
Note payable used to pay expenses		9,160			60,000
Note payable used to pay origionation fees & interest		33,140			50,000
Sale of common stock		236,550			10,000

Net Cash Flows provided by financing activities		431,690			280,000


Net Increase (Decrease) In Cash and cash equivalents		13,804			7,171
Cash and cash equivalents at beginning of period		143,423			31,240

Cash and cash equivalents at end of period	$	157,227		$	38,411

Supplementary Disclosure Of Cash Flow Information:

Stock issued for services, licenses and other assets	$	116,500		$	593,400
Stock issued for note conversions including interest	$	576,735		$	-
Stock issued for interest				$	170,000
Stock issued for payment of expenses	$	-		$	43,333
Loan proceeds used to pay expenses	$	-		$	40,000
Cash paid for interest	$	-		$	-
Cash paid for income taxes	$	-		$	-

See Accompanying Notes To These Financial Statements.

Sunshine Biopharma, Inc.

Notes to Unaudited Consolidated Financial Statements

For The Three-and Six-Month Interim Periods Ended June 30, 2015

Note 1 - Descriptions of Business

Mountain West Business Solutions, Inc. (“MWBS”) was incorporated on August 31, 2006 in the State of Colorado. Sunshine Etopo, Inc. (formerly Sunshine Biopharma, Inc.) was incorporated in the State of Colorado on August 17, 2009. Effective October 15, 2009 MWBS was acquired by Sunshine Etopo, Inc. in a transaction classified as a reverse acquisition. MWBS concurrently changed its name to Sunshine Biopharma, Inc. The financial statements represent the consolidated activity of Sunshine Biopharma, Inc. and Sunshine Etopo, Inc. Sunshine Biopharma, Inc. and Sunshine Etopo, Inc. are hereinafter referred to collectively as the "Company". The Company was formed for the purposes of conducting research, development and commercialization of drugs for the treatment of various forms of cancer. The Company may also engage in any other business that is permitted by law, as designated by the Board of Directors of the Company.

In July 2014 the Company formed a wholly owned Canadian Subsidiary, Sunshine Biopharma Canada Inc. (“Canadian Subsidiary”). Until March 2015 the Canadian Subsidiary was inactive. Sunshine Biopharma, Inc., Sunshine Etopo, Inc. and the Canadian Subsidiary are hereinafter referred to collectively as the "Company".

During the last three month period the Company has continued to raise money through stock sales and borrowings.

The Company’s activities are subject to significant risks and uncertainties, including failing to secure additional funding to operationalize the Company’s current technology before another company develops a similar technology and drug.

Note 2 - Summary of Significant Accounting Policies

This summary of significant accounting policies is presented to assist thereader in understanding the Company's financial statements. The consolidated financial statements and notes are representations of the Company's management, which is responsible for their integrity and objectivity. These accounting policies conform to generally accepted accounting principles and have been consistently applied in the preparation of the financial statements.

PRINCIPLES OF CONSOLIDATION

The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation.

Sunshine Biopharma, Inc.

Notes to Unaudited Consolidated Financial Statements

For The Three-and Six-Month Interim Periods Ended June 30, 2015

Note 2 - Summary of Significant Accounting Policies (Continued)

USE OF ESTIMATES

The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The more significant estimates and assumptions made by management are valuation of equity instruments, depreciation of property and equipment, and deferred tax asset valuation. Actual results could differ from those estimates as the current economic environment has increased the degree of uncertainty inherent in these estimates and assumptions.

CASH AND CASH EQUIVALENTS

For the Balance Sheets and Statements of Cash Flows, all highly liquid investmentswith maturity of 90 days or less are considered to be cash equivalents. The Company had a cash balance of $157,227 and $143,423 as of June 30, 2015 and December 31, 2014, respectively. At times such cash balances may be in excess of the FDIC limit of $250,000.

FOREIGN CURRENCY

The Company has operations in Canada, however the functional and reporting currency is in U.S. dollars. To come to this conclusion the Company considered the direction of ASC section 830-10-55.

Selling Price and Market – As an office is located in the Canada, the Company is performing consulting services to Canadian based customers. The Company has not had any product sales but anticipates 100% of its customers will be in the United States and these sales are paid in U.S. dollars. This indicates the functional currency is U.S. dollars.

Financing – The Company’s financing has been generated exclusively in U.S. dollars from the United States. This indicates the functional currency is U.S. dollars.

Expenses – The majority of expense are paid in U.S. dollars. The expenses generated in PRC are paid by a monthly or weekly cash transfer from the U.S. when the expenses are due, resulting in very little foreign currency exposure. This indicates the functional currency is U.S. dollars.

Sunshine Biopharma, Inc.

Notes to Unaudited Consolidated Financial Statements

For The Three-and Six-Month Interim Periods Ended June 30, 2015

Note 2 - Summary of Significant Accounting Policies (Continued)

FOREIGN CURRENCY (continued)

Numerous Intercompany Transactions – The Company has multiple transactions each month between the U.S. and Chinese representative office. This indicates the functional currency is U.S. dollars.

Due to the functional and reporting currency both being in U.S. dollars, ASC 830-10-45-17 states that a currency translation is not necessary.

REVENUE RECOGNITION

The Company recognizes revenue on consulting at the time the service is rendered.

GOING CONCERN

The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. Since inception, the Company has had recurring operating losses and negative operating cash flows. These factors raise substantial doubt about the Company’s ability to continue as a going concern.

The Company’s continuation as a going concern is dependent on its ability to obtain additional financing to fund operations, implement its business model, and ultimately, to attain profitable operations. The Company will need to secure additional funds through various means, including an acquisition, equity and debt financing or any similar financing. There can be no assurance that the Company will be able to obtain additional debt or equity financing, if and when needed, on terms acceptable to the Company, or at all. Any additional equity or debt financing may involve substantial dilution to the Company’s stockholders, restrictive covenants or high interest costs. The Company’s long-term liquidity also depends upon its ability to generate revenues and achieve profitability.

The accompanying financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

Sunshine Biopharma, Inc.

Notes to Unaudited Consolidated Financial Statements

For The Three-and Six-Month Interim Periods Ended June 30, 2015

Note 3– Unaudited Financial Information

The unaudited financial information included for the three and six month interim period ended June 30, 2015 was taken from the books and records of the Company without audit. However, such information reflects all adjustments, consisting only of normal recurring adjustments, which in the opinion of management are necessary to reflect properly the results of the interim periods presented. The results of operations for the three month interim period ended June 30, 2015 are not necessarily indicative of the results expected for the fiscal year ending December 31, 2015. See the Notes in our 2014 10-K consolidated financial statements for a complete summary of our significant accounting policies.

Note 4 – Notes Payable

The Company had outstanding loans of $12,500 accruing interest at a rate of 12%, $161,140 accruing interest at 12%, and $217,000 accruing interest at 8%. At June 30, 2015 and December 31, 2014 accrued interest was $9,759 and $16,113, respectively.

Note 5 – Issuance of Common Stock

During the six months ended June 30, 2015, the Company issued, 52,921,409 shares of its $0.001 par value Common Stock. Of these, 31,121,409 shares valued at $576,735 reduced debt by $287,804 and generating a loss on conversion of $288,931 for the period.

In March 2015, the Company’s Board of Directors authorized a private offering of Common Stock in Canada pursuant to Regulation S promulgated under the Securities Act of 1933, as amended, wherein the Company is offering up to 60,000,000 shares of its Common Stock at an offering price of $0.015 Canadian per share for aggregate gross proceeds of up to $900,000 Canadian. As of June 30, 2015, the Company has accepted two subscriptions each of 10,000,000 shares for $150,000 Canadian, aggregating $300,000 Canadian or approximately $236,550 US.

The Company declared no dividends through June 30, 2015.

Note 6 – Issuance of “Series B” Preferred Stock

During the six month period ended June 30, 2015, the Company authorized 500,000 shares of $0.10 par value Series "B" Preferred stock. The stock gives the holder the right to 1,000 votes per share. 500,000 shares of Series "B" preferred shares were issued to the CEO of the Company in exchange for services of $50,000.

Sunshine Biopharma, Inc.

Notes to Unaudited Consolidated Financial Statements

For The Three-and Six-Month Interim Periods Ended June 30, 2015

Note 7 – Convertible Notes

A Note with a Face Value $128,000, bearing interest at10% was issued on November 27, 2014 and was due May 27, 2015. The was issued at a premium and is convertible from the date of issuance into $0.001 par value Common Stock at a price of $0.20 per share.On June 30, 2015, the Company renewed this note with the addition of accrued interest amounting to $7,540 and an origination fee of $25,600. The new note has a face value of $161,140, an origination fee of $32,228 and accrues interest at 12%. The new note is convertible anytime from the date of issuance into shares of $0.001 par value Common Stock at a 35% discount from market price. Any gain or loss will be recognized at conversion.

A note having a remaining balance of $94,624 as of December 31, 2014 was fully converted into shares of our $0.001 par value Common Stock during the six month period ended June 30, 2015. In connection therewith, 11,513,839 shares of $0.001 Common Stock valued at $242,415 were issued, reducing the debt by $94,624 and generating a loss on conversion of $147,791.

A convertible note with an original face value of $113,500 was fully converted into shares of our $0.001 par value Common Stock during the six month period ended June 30, 2015. 12,395,296 shares of $0.001 par value Common Stock valued at $203,144 were issued in connection therewith, generating a loss of $89,644 on conversion.

A note having a face value of $53,500 with interest at 8% is due August 17, 2015. The Note was fully converted as of June 30, 2015. $53,500 in principal and $2,140 in interest was converted into shares of our $0.001 par value Common Stock during the six month period ended June 30, 2015. In connection therewith, 4,622,793 shares of $0.001 par value Common Stock valued at $88,777, were issued generating a loss of $33,137 on conversion.

A note having a face value of $78,000 with interest at 8% is due November 14, 2015. $23,000 of principal and $1,040 in interest and was converted into shares of $0.001 par value Common Stock during the six month period ended June 30, 2015, leaving a principal balance of $55,000. 2,589,481 shares of $0.001 par value Common Stock valued at $42,399 generating a loss of $18,359 were issued on conversion. The note is convertible after 180 days from issuance into shares of $0.001 par value Common Stock at a price 35% below market value.We estimate that the fair value of the convertible debt approximates the face value, so no value has been assigned to the beneficial conversion feature.

In April 2015, the Company received monies in exchange for a note having a face value of $83,500 with interest at 8% and which is due January 23, 2016. The Note is convertible after 180 days from issuance into $0.001 par value Common Stock at a price 35% below market value. We estimate that the fair value of the convertible debt approximates the face value, so no value has been assigned to the beneficial conversion feature.

Sunshine Biopharma, Inc.

Notes to Unaudited Consolidated Financial Statements

For The Three-and Six-Month Interim Periods Ended June 30, 2015

Note 7 – Convertible Notes (Continued)

In April 2015, the Company received monies in exchange for a note having a face value of $83,500 with interest at 8% and which is due January 23, 2016. The Note is convertible after 180 days from issuance into shares of $0.001 par value Common Stock at a price 35% below market value.We estimate that the fair value of the convertible debt approximates the face value, so no value has been assigned to the beneficial conversion feature.

In May 2015, the Company received monies in exchange for a note having a face value of $78,500 with interest at 8% and which is due March 1, 2016. The Note is convertible after 180 days from issuance into shares of $0.001 par value Common Stock at a price 35% below market value.We estimate that the fair value of the convertible debt approximates the face value, so no value has been assigned to the beneficial conversion feature.

Note 8 – Earnings (Loss) per Share

Earnings (loss) per share is computed using the weighted average number of common shares outstanding during the period. The Company has adopted ASC 260 (formerly SFAS128), “Earnings Per Share”.

Note 9– Financial Statements

For a complete set of footnotes, reference is made to the Company’s Report on Form 10-K for the year ended December 31, 2014, as filed with the Securities and Exchange Commission and the audited financial statements included therein.

Note 10 – Subsequent Events

On July 15, 2015 the holder of a convertible note having a principal balance of $55,000 as of June 30, 2015 (see Note 7 above) elected to convert $5,000 in principal amount and $260 in interest into 642,213 shares of $0.001 par value Common Stock leaving a principal balance of $50,000.

On July 17, 2015, we completed the process of increasing our authorized capital of $0.001 par value Common Stock from 200,000,000 shares to 500,000,000 shares.

On July 24, 2015, the holder of a convertible note having a principal balance of $55,000 as of June 30, 2015 elected to convert $17,000 in principal amount and $917 in interest into 2,176,105 shares of $0.001 par value Common Stock, leaving a principal balance of $33,000.

CAUTIONARY STATEMENT ON FORWARD-LOOKING INFORMATION

This Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based upon our current assumptions, expectations and beliefs concerning future developments and their potential effect on our business. In some cases, you can identify forward-looking statements by the following words: “may,” “will,” “could,” “would,” “should,” “expect,” “intend,” “plan,” “anticipate,” “believe,” “approximately,” “estimate,” “predict,” “project,” “potential,” “continue,” “ongoing,” or the negative of these terms or other comparable terminology, although the absence of these words does not necessarily mean that a statement is not forward-looking. This information may involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements to be materially different from the future results, performance or achievements expressed or implied by any forward-looking statements.

Factors that may cause or contribute actual results to differ from these forward-looking statements include, but are not limited to, for example:

●	adverse economic conditions;

●	risks related to the construction market;

●	risks related to the U.S. import market;

●	the inability to attract and retain qualified senior management and technical personnel;

●	other risks and uncertainties related to the changing lighting market and our business strategy.

All forward-looking statements speak only as of the date of this report. We undertake no obligation to update any forward-looking statements or other information contained herein. Stockholders and potential investors should not place undue reliance on these forward-looking statements. Although we believe that our plans, intentions and expectations reflected in or suggested by the forward-looking statements in this report are reasonable, we cannot assure stockholders and potential investors that these plans, intentions or expectations will be achieved. We disclose important factors that could cause our actual results to differ materially from expectations under “Risk Factors” and elsewhere in this current report. These cautionary statements qualify all forward-looking statements attributable to us or persons acting on our behalf.

These forward-looking statements represent our intentions, plans, expectations, assumptions and beliefs about future events and are subject to risks, uncertainties and other factors. Many of those factors are outside of our control and could cause actual results to differ materially from the results expressed or implied by those forward-looking statements. In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements might not occur or might occur to a different extent or at a different time than we have described. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of the Quarterly Report on Form 10-Q. All subsequent written and oral forward-looking statements concerning other matters addressed in this Quarterly Report on Form 10-Q and attributable to us or any person acting on our behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this Quarterly Report on Form 10-Q.

Except to the extent required by law, we undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, a change in events, conditions, circumstances or assumptions underlying such statements, or otherwise.

PART I.

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

The following discussion should be read in conjunction with our consolidated financial statements and notes thereto included herein. In connection with, and because we desire to take advantage of, the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, we caution readers regarding certain forward looking statements in the following discussion and elsewhere in this report and in any other statement made by, or on our behalf, whether or not in future filings with the Securities and Exchange Commission. Forward looking statements are statements not based on historical information and which relate to future operations, strategies, financial results or other developments. Forward looking statements are necessarily based upon estimates and assumptions that are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond our control and many of which, with respect to future business decisions, are subject to change. These uncertainties and contingencies can affect actual results and could cause actual results to differ materially from those expressed in any forward looking statements made by, or on our behalf. We disclaim any obligation to update forward looking statements.

Overview and History

We were incorporated in the State of Colorado on August 31, 2006 under the name “Mountain West Business Solutions, Inc.” During our fiscal year ended July 31, 2009 our business was to provide management consulting with regard to accounting, computer and general business issues for small and home-office based companies. Effective October 15, 2009, we executed an agreement to acquire Sunshine Biopharma, Inc., a Colorado corporation in exchange for the issuance of 21,962,000 shares of our Common Stock and 850,000 shares of Convertible Preferred Stock, each convertible into twenty (20) shares of our Common Stock. As a result of this transaction our then officers and directors resigned their positions with us and were replaced by our current management. As a result of this transaction we also changed our name to “Sunshine Biopharma, Inc.”

Our principal place of business is located at 469 Jean-Talon West, 3rd Floor, Montreal, Quebec, Canada H3N 1R4. Our phone number is (514) 764-9698 and our website address is www.sunshinebiopharma.com.

We have not been subject to any bankruptcy, receivership or similar proceeding.

Results Of Operations

Comparison of Results of Operations for the Six Months Ended June 30, 2015 and 2014

For the six months ended June 30, 2015 and 2014 we did not generate any material revenues. We did generate gross revenues of $1,708 during the three months ended June 30, 2015 from scientific consulting services provided to a local company in Montreal (Canada). We did not generate any revenues in 2014.

General and administrative expenses during the six month period ended June 30, 2015 were $494,690, compared to general and administrative expense of $1,171,387 incurred during the six month period ended June 30, 2014, a decrease of $676,697. This decrease is primarily attributable to (i) a decrease of $323,000 in research and development ("R&D") expenses. We incurred no R&D charges during the six months ended June 30, 2015, as our management concentrated on raising money to manufacture our drug; (ii) a decrease of $224,579 in consulting fees. The decrease in consulting fees was as a result of our not using consultants in our fund raising efforts; and (iii) a decrease of $117,175 in professional fees. In addition, we had incurred $100,000 in public relations fees during the six months ended June 30, 2014 that we did not incur during the similar period in 2015.

We also incurred $39,431 in interest expense during the six months ended June 30, 2015, compared to $148,257 in interest expense during the similar period in 2014. However, during the six months ended June 30, 2015, we incurred $279,466 in losses as a result of debt conversion. We did not incur any corresponding loss during the similar period in 2014 due to the fact that we had no convertible debt during that period.

As a result, we incurred a net loss of $811,879 (approximately $0.01 per share) for the six month period ended June 30, 2015, compared to a net loss of $1,319,644 (approximately $0.02 per share) during the six month period ended June 30, 2014.

Comparison of Results of Operations for the Three Months Ended June 30, 2015 and 2014

For the three months ended June 30, 2015 and 2014 we did not generate any material revenues. We did generate gross revenues of $1,708 during the three months ended June 30, 2015 from scientific consulting services provided to a local company in Montreal (Canada). We did not generate any revenues in 2014.

General and administrative expenses during the three month period ended June 30, 2015 were $369,865, compared to general and administrative expense of $765,513 incurred during the three month period ended June 30, 2014, a decrease of $395,648. This decrease is attributable to a decrease of $323,000 in R&D expenses. We incurred no R&D charges during the three months ended June 30, 2015, as our management concentrated on raising money to manufacture our drug. In addition, we had incurred $100,000 in public relations fees during the three months ended June 30, 2014 that we did not incur during the similar period in 2015. However, during the three months ended June 30, 2015, consulting fees increased by approximately $20,000 and payments towards annual license fees due increased by approximately $74,000. We also incurred $50,000 in officer remuneration during the three months ended June 30, 2015 that we did not incur during the similar period in 2014. During the three months ended June 30, 2015, legal fees decreased by approximately $130,000 as a result of not having to file registration statements with the SEC and not having expenses associated with defending litigation brought against us that had been resolved during 2014.

We also incurred $33,226 in interest expense during the three months ended June 30, 2015, compared to $95,382 in interest expense during the similar period in 2014. However, during the three months ended June 30, 2015, we incurred $116,129 in losses as a result of debt conversion. We did not incur any corresponding loss during the similar period in 2014 as we had no convertible debt during that period.

As a result, we incurred a net loss of $517,512 (less than $0.01 per share) for the three month period ended June 30, 2015, compared to a net loss of $765,513 (approximately $0.01 per share) during the three month period ended June 30, 2014.

Because we did not generate any material revenues since our inception, following is our Plan of Operation.

Plan of Operation

We are currently a pharmaceutical company focused on the research, development and commercialization of drugs for the treatment of various forms of cancer. The preclinical studies for our lead compound, Adva-27a, a multi-purpose antitumor compound, were successfully completed in late 2011. We are now continuing our clinical development of Adva-27a by conducting the next sequence of steps comprised of Good Manufacturing Practice (“GMP”) manufacturing of a 2 kilogram quantity, Investigational New Drug (“IND”)-enabling studies, regulatory filing and Phase I clinical trials. We plan to conduct our Phase I clinical trials for Adva-27a at the Jewish General Hospital, Montreal, Canada, one of McGill University’s Hospital Centers. The planned indication will be pancreatic cancer in parallel to multidrug resistant breast cancer as Adva-27a has shown a positive effect on both of these cancer types for which there is currently little or no treatment options available. See “Clinical Trials” below.

We have licensed our technology on an exclusive basis from Advanomics Corporation, and we are planning to initiate our own research and development program as soon as practicable once financing is in place. There are no assurances that we will obtain the financing necessary to allow us to implement this aspect of our business plan, or to enter clinical trials. See "Part I, Item 2, Management's Discussion and Analysis of Financial Condition -- Liquidity and Capital Resources," below.

Carbon-Difluoride Platform Technology

Many therapeutically important compounds contain diester bonds that link different parts of the molecule together. Diester bonds are naturally unstable often leading to suboptimal performance when the molecule is administered to patients. Diester bonds have specific nine-dimensional, as well as electrostatic properties that cannot be easily mimicked by other bonds. Bonds that do not mimic the diester bond correctly invariably render the compound inactive. In collaboration with Institut National des Sciences Appliquées de Rouen in France (“INSA”), Advanomics has developed a way to replace the diester bond with a Carbon-Difluoride bond which acts as a diester isostere. An isostere is a different chemical structure that mimics the properties of the original. In the body, Carbon-Difluoride compounds are resistant to metabolic degradation but recognized similarly to the diester compounds (see Figure 1).

Figure 1

Our Lead Compound (Adva-27a)

Our initial drug candidate is Adva-27a, a GEM-difluorinated C-glycoside derivative of Podophyllotoxin, targeted for various forms of cancer. If we are successful in our current financing efforts, Adva-27a is expected to enter Phase I clinical trials for pancreatic cancer and multidrug resistant breast cancer in mid to late 2016 (see “Clinical Development Path” and “Clinical Trials” below). Etoposide, which is also a derivative of Podophyllotoxin, is currently on the market and is used to treat various types of cancer including leukemia, lymphoma, testicular cancer, lung cancer, brain cancer, prostate cancer, bladder cancer, colon cancer, ovarian cancer, liver cancer and several other forms of cancer. Like Etoposide, Adva-27a is a Topoisomerase II inhibitor; however, unlike Etoposide and other anti-tumor drugs currently in use, Adva-27a is able to destroy multidrug resistant cancer cells. Adva-27a is a new chemical entity and has been shown to have distinct and more desirable biological properties compared to Etoposide. Most notably, Adva-27a is very effective against multidrug resistant breast cancer cells while Etoposide has no activity against this aggressive form of cancer (see Figure 2). In other side-by-side studies against Etoposide as a reference, Adva-27a showed markedly improved cell killing activity in various other cancer types, particularly prostate, colon and lung cancer (see Table 1). Our preclinical studies to date have shown that:

●	Adva-27a is effective at killing different types of multidrug resistant cancer cells, including:

	°	Breast Cancer Cells (MCF-7/MDR)

	°	Small Cell Lung Cancer Cells (H69AR)

	°	Uterine Cancer (MES-SA/Dx5)

	°	Pancreatic Cancer (Panc-1)

●	Adva-27a is unaffected by P-Glycoprotein, the enzyme responsible for making cancer cells resistant to anti-tumor drugs.

●	Adva-27a has excellent clearance time (half-life = 54 minutes) as indicated by human microsomes stability studies and pharmacokinetics data in rats.

●	Adva-27a clearance is independent of Cytochrome P450, a mechanism that is less likely to produce toxic intermediates.

●	Adva-27a is an excellent inhibitor of Topoisomerase II with an IC50 of only 13.7 micromolar (this number has recently been reduce to 1.44 micromolar as a result of resolving the two isomeric forms of Adva-27a).

●	Adva-27a has shown excellent pharmacokinetics profile as indicated by studies done in rats.

●	Adva-27a does not inhibit tubulin assembly.

These and other preclinical data have been published in ANTICANCER RESEARCH, a peer-reviewed International Journal of Cancer Research and Treatment. The manuscript entitled “Adva-27a, a Novel Podophyllotoxin Derivative Found to Be Effective Against Multidrug Resistant Human Cancer Cells” appeared in print in the October 2012 issue of the journal [ANTICANCER RESEARCH 32: 4423-4432 (2012)]. A copy of the full manuscript as it appeared in the journal is available on our website at www.sunshinebiopharma.com.

Figure 2

Table 1

Clinical Development Path

The early stage preclinical studies for our lead compound, Adva-27a, were successfully completed in late 2011 and the results have been published [ANTICANCER RESEARCH 32: 4423-4432 (2012)]. We have been delayed in our implementation of our clinical development program due to lack of funding, but, while there are no assurances, we now believe we may have secured this funding. If we do receive this funding, we will continue our clinical development program of Adva-27a by conducting the next sequence of steps comprised of the following:

	●	GMP Manufacturing of 2 kilogram for use in IND-Enabling Studies and Phase I Clinical Trials

	●	IND-Enabling Studies

	●	Regulatory Filing (Fast-Track Status Anticipated)

	●	Phase I Clinical Trials (Multidrug Resistant Breast Cancer Indication)

GMP Manufacturing

On November 14, 2014, we entered into a Manufacturing Services Agreement with Lonza Ltd. and Lonza Sales Ltd. (hereinafter jointly referred to as “Lonza”), whereby we engaged Lonza to be the manufacturer of our Adva-27a anticancer drug (the “Lonza Agreement”). Lonza is one of the world’s leading and most-trusted manufacturers of pharmaceutical ingredients. Headquartered in Basel, Switzerland, Lonza has more than 40 major manufacturing facilities worldwide and is currently manufacturing 2 kilograms of our Adva-27a for clinical trials. The Lonza Agreement was effective November 10, 2014, has a term of 5 years, and may be extended or terminated earlier as provided in the Lonza Agreement. On November 30, 2014, we placed a Purchase Order for the manufacturing of 2 kilograms of our Adva-27a at an initial cost of $385,000 for the purchase of raw material and delivery of samples for process validation. Lonza has deferred the $385,000 payment until the samples for process validation are delivered, which was recently received.

In June 2015 we received a sample of the scale-up manufacturing process for evaluation and confirmation of adherence to specifications. Based upon our laboratory analyses, the sample meets all of the required chemical, physical and biological specifications. As a result, Lonza is now moving forward with large scale manufacturing of a 2-kilogram quantity for the IND-Enabling studies and clinical trials. We estimate that we will receive this from Lonza in the first quarter of 2016. If this timetable is met, of which there can be no assurance, and subject to receipt of the necessary financing, also for which no assurances can be provided, we expect to move into Phase I of our clinical trials in late 2016 or early 2017.

Pursuant to the terms of the Lonza Agreement, Lonza will manufacture our drug in accordance with current Good Manufacturing Practices (“cGMP”) in compliance with the regulations applicable in the U.S., Canada, Europe and other countries around the world relating to the manufacturing of medicinal products for human use. Lonza will build a master drug file for our Adva-27a drug and will have it ready for filing with regulatory authorities as may be required to secure ultimate drug approval. Kilogram level cGMP manufacturing for clinical trials shall commence following completion and testing of the process validation samples. Lonza is also responsible for procuring all required raw materials to prepare the batches, at our cost. The Agreement provides for us to maintain one representative of our Company at their facility during the manufacturing process. Quality assurance and control is the responsibility of both Lonza and us during the process.

We have the right to inspect, test and approve all batches to insure compliance with the manufacturing specifications, which is required to be completed within 30 days after release of a batch. In the event of a dispute regarding compliance with the manufacturing specifications, the dispute will be resolved ultimately by independent analysis and testing.

The Lonza Agreement contains customary warranties and disclaimers, confidentiality provisions as well as mutual indemnifications common in agreements of this type.

Clinical Trials

Adva-27a’s initial indication will be pancreatic cancer and multidrug resistant breast cancer for which there are currently little or no treatment options available. In June 2011 we concluded an agreement with McGill University’s Jewish General Hospital in Montreal, Canada to conduct Phase I clinical trials for these two indications. All aspects of the planned clinical trials in Canada will employ U.S. Food and Drug Administration (“FDA”) standards at all levels. As a result of the Dutchess Agreement and other financing opportunities described below, we now anticipate that Phase I clinical trials will commence in late 2016 or early 2017 and we estimate that it will take 18 months to complete, at which time we expect to receive limited marketing approval for “compassionate-use” under the FDA and similar guidelines in Canada. See “Marketing,” below.

Marketing

According to the American Cancer Society, nearly 1.5 million new cases of cancer are diagnosed in the U.S. each year. Given the terminal and limited treatment options available for the pancreatic cancer and multidrug resistant breast cancer indications we are planning to study, we anticipate being granted limited marketing approval (“compassionate-use”) for our Adva-27a following receipt of funding and a successful Phase I clinical trial. There are no assurances that either will occur. Such limited approval will allow us to make the drug available to various hospitals and health care centers for experimental therapy and/or “compassionate-use”, thereby generating some revenues in the near-term.

We believe that upon successful completion of Phase I Clinical Trials we may receive one or more offers from large pharmaceutical companies to buyout or license our drug. However, there are no assurances that our Phase I Trials will be successful, or if successful, that any pharmaceutical companies will make an acceptable offer to us. In the event we do not consummate such a transaction, we will require significant capital in order to manufacture and market our new drug.

Intellectual Property

We are the exclusive licensee for the U.S. territory of Advanomics Corporation’s Adva-27a which is covered by international patent applications filed on April 27, 2007 (PCT/FR2007/000697). These patent applications, which are now issued in Europe, Canada and the United States (US 8,236,935) and are still pending elsewhere around the world, were originally owned by Institut National des Sciences Appliquées de Rouen (France) and have recently been purchased by Advanomics Corporation. On January 14, 2013, Advanomics Corporation filed a new patent application covering Adva-27a manufacturing processes as well as new Adva-27a derivatives and compositions.

Our Lead Anti-Cancer Compound, Adva-27a, in 3D

Development of New Business

On July 25, 2014, we formed Sunshine Biopharma Canada Inc., a Canadian wholly owned subsidiary for the purposes of conducting pharmaceutical business in Canada and elsewhere around the globe. While no assurances can be provided and subject to the availability of adequate financing, of which there is no assurance, we anticipate that Sunshine Biopharma Canada will soon secure a Drug Establishment License (DEL) from Health Canada and proceed to signing manufacturing, marketing, sales and distribution contracts for various generic pharmaceuticals and biomedical products. This new effort broadens our business scope and provides us with the opportunity to generate revenues in the near to mid-term. We anticipate revenues to be generated through the export of generic pharmaceuticals overseas. There are no assurances that we will be able to sign applicable contracts or generate profits from these anticipated new operations. In addition to revenue generation, we anticipate that as a result of these activities, Sunshine Biopharma Canada will then be well positioned for the marketing and distribution of Adva-27a, our flagship oncology drug candidate currently being developed for the treatment of pancreatic cancer and multidrug resistant breast cancer, provided that Adva-27a is approved for such marketing and distribution, of which there can be no assurance.

While no assurances can be provided, we are also planning to expand our product line through acquisitions and/or in-licensing as well as in-house research and development.

Government Regulations

Our existing and proposed business operations are subject to extensive and frequently changing federal, state, provincial and local laws and regulations. We will be subject to significant regulations in the U.S. in order to obtain the approval of the FDA to offer our product on the market. The approximate procedure for obtaining FDA approval involves an initial filing of an IND application following which the FDA would give the go ahead with Phase I clinical (human) trials. As a result of the Dutchess Agreement and other financing opportunities described below, we now anticipate that this process will commence in mid to late 2016 and we estimate that this procedure will take 18 months to complete. Following completion of Phase I, the results are filed with the FDA and a request is made to proceed to Phase II. Similarly, following completion of Phase II the data are filed with the FDA and a request is made to proceed to Phase III. Following completion of Phase III, a request is made for marketing approval. Depending on various issues and considerations, the FDA could provide limited marketing approval on a humanitarian basis if the drug treats terminally ill patients with limited treatment options available. As of the date of this Report we have not made any filings with the FDA or other regulatory bodies in other jurisdictions. We have however had extensive discussions with clinicians at the McGill University’s Jewish General Hospital in Montreal where we plan to undertake our Phase I study for pancreatic cancer and multidrug resistant breast cancer they believe that Health Canada is likely to grant us a so-called fast-track process on the basis of the terminal nature of the cancer types which we will be treating. There are no assurances this will occur.

Employees

As of the date of this Report we have three (3) employees, our management. We anticipate that if we receive financing we will hire additional employees in the areas of accounting, regulatory affairs, marketing and laboratory personnel.

Competition

We will be competing with publicly and privately held companies engaged in developing cancer therapies. There are numerous other entities engaged in this business that have greater resources, both financial and otherwise, than the resources presently available to us. Nearly all major pharmaceutical companies including Amgen, Roche, Pfizer, Bristol-Myers Squibb and Novartis, to name just a few, have on-going anti-cancer drug development programs and some of the drug they may develop could be in direct competition with our drug. Also, a number of small companies are also working in the area of cancer and could develop drugs that may be in competition with ours. However, none of these competitor companies can use molecules similar to ours as they would be infringing our patents.

Trademarks-Tradenames

We are the exclusive licensee for the U.S. territory of Advanomics’ Adva-27a which is covered by international patent applications filed on April 27, 2007 (PCT/FR2007/000697). These patent applications, which are now issued in Europe, Canada and the United States (US 8,236,935) and which are still pending elsewhere around the world, were originally owned by Institut National des Sciences Appliquées de Rouen (France) and have recently been purchased by Advanomics.

Liquidity and Capital Resources

As of June 30, 2015, we had cash or cash equivalents of $157,227.

Net cash used in operating activities was $417,886 during the six month period ended June 30, 2015, compared to $272,829 for the six month period ended June 30, 2014. We anticipate that overhead costs in current operations will increase in the future once our research and development activities discussed above increase.

Cash flows from financing activities were $431,690 for the six month periods ended June 30, 2015, compared to $280,000 during the six months ended June 30, 2014. Cash flows used by investing activities were $0 for the six month periods ended June 30, 2015 and 2014.

During the six months ended June 30, 2015 we issued 52,921,409 shares of our $0.001 par value Common Stock. Of these, 31,121,409 shares valued at $576,735 were issued in connection with debt conversion reducing the debt by $287,804 and generating a loss of $288,931 for the period. In March 2015, our Board of Directors authorized a private offering of Common Stock in Canada pursuant to Regulation S promulgated under the Securities Act of 1933, as amended, wherein we are offering up to 60,000,000 shares of our Common Stock at an offering price of $0.015 Canadian per share for aggregate gross proceeds of up to $900,000 Canadian. As of June 30, 2015 we had accepted two subscriptions each of 10,000,000 shares for $150,000 Canadian, aggregating $300,000 Canadian or approximately $236,550 US. This offering will terminate on September 20, 2015. We utilized the proceeds derived from the sale of these shares for working capital.

We issued a note in the principal amount of $128,000 on November 27, 2014, which accrued interest at the rate of 10% per annum and which was due May 27, 2015. The note was issued at a premium and is convertible from the date of issuance into shares of our Common Stock at a price of $0.20 per share. On June 30, 2015, we renewed this note with the addition of accrued interest amounting to $7,540 and an origination fee of $25,600. The new note has a face value of $161,140, an origination fee of $32,228 and accrues interest at 12%. The new note is convertible anytime from the date of issuance into shares of our Common Stock at a 35% discount from market price. Any gain or loss will be recognized at conversion.

A note having a remaining balance of $94,624 as of December 31, 2014 was fully converted into 11,513,839 shares of our Common Stock valued at $242,415. This generated a loss on conversion of $147,791during the six month period ended June 30, 2015.

A convertible note with an original face value of $113,500 was fully converted into 12,395,296 shares of our Common Stock valued at $203,144 during the six month period ended June 30, 2015. This transaction generated a loss of $89,644 on conversion.

A note having a face value of $53,500 with interest at 8% was due August 17, 2015. This note, including accrued interest, was fully converted into 4,622,793 shares of our Common Stock valued at $88,777 during the six month period ended June 30, 2015. This transaction generated a loss of $35,277 on conversion.

A note having a face value of $78,000 with interest at 8% is due November 14, 2015. $23,000 of principal and $1,040 in accrued interest and was converted into 2,589,481 shares of our Common Stock during the six month period ended June 30, 2015, leaving a principal balance of $55,000. This transaction generated a loss of $18,359 on conversion. The note is convertible after 180 days from issuance into shares of our Common Stock at a price 35% below market value. We estimate that the fair value of the convertible debt approximates the face value, so no value has been assigned to the beneficial conversion feature.

In April 2015, we issued a convertible promissory note in the principal amount of $83,500 with interest accruing at 8% per annum and which is due January 23, 2016. The Note is convertible after 180 days from issuance into shares of our Common Stock at a price 35% below market value. We estimate that the fair value of the convertible debt approximates the face value, so no value has been assigned to the beneficial conversion feature.

In May 2015, we issued a convertible promissory note in the principal amount of $78,500 with interest accruing at 8% per annum and which is due March 1, 2016. The note is convertible after 180 days from issuance into shares of our Common Stock at a price 35% below market value. We estimate that the fair value of the convertible debt approximates the face value, so no value has been assigned to the beneficial conversion feature.

On March 27, 2014, we issued a Convertible note to one accredited investor (as that term is defined under the Securities Act of 1933, as amended) in the aggregate amount of $100,000 plus 500,000 Common shares (paid) and $20,000 (unpaid) for origination fee. This Convertible Note accrues interest at the rate of 10% per annum and is convertible at the option of the Holder into shares of our Common Stock at $0.20 per share on or before September 27, 2014. Since the note was issued at a premium no value is apportioned to the conversion feature when recording the issue per ASC 470-20-05. The debt and its interest are reported as if it were a nonconvertible debt. Upon conversion the issued stock may be valued at either the book value or the market value of the note. This Convertible Note together with origination fees and all interest accrued thereon was paid in full through the issuance of a new Convertible Note with a principal amount of $128,000 as specified above.

On April 23, 2014, we entered into an Investment Agreement (the “Investment Agreement”) with Dutchess Opportunity Fund, II, LP (“Dutchess”), for the sale of up to $2.5 million of shares of our Common stock over a three-year commitment period. Under the terms of the Investment Agreement, we may, from time to time and in our sole discretion, issue shares of our Common Stock to Dutchess at a price equal to ninety percent (90%) of the lowest daily volume weighted average price during a Trading Day of our Common Stock during the five (5) consecutive Trading Days immediately preceding the Put Notice Date, up to $2.5 million. In connection with the Investment Agreement, we also issued to Dutchess an engagement fee in the form of 400,000 “restricted” shares of our Common Stock.

The amount of each tranche under the Investment Agreement is limited to maximum $100,000 and we may only issue a Put Notice (as defined under the Investment Agreement) ten (10) Trading Days after each prior Put Notice Date. We are not obligated to utilize any of the $2.5 million available under the Investment Agreement and there are no minimum commitments or minimum use penalties.

The Investment Agreement does not impose any restrictions on our operating activities. During the term of the Investment Agreement, Dutchess is prohibited from engaging in any short selling or hedging transactions, either directly or indirectly, related to our Common stock.

On August 7, 2014, we elected to issue our initial put notice to Dutchess, wherein we requested that Dutchess purchase 930,233 shares of our Common Stock for $100,000. We utilized the proceeds from the sale of these shares to repay debt.

We are not generating revenue from our operations, and our ability to implement our business plan for the future will depend on the future availability of financing. Such financing will be required to enable us to further develop our drug research and development capabilities and continue operations. We intend to raise funds through private placements of our Common Stock and through short-term borrowing. We estimate that we will require approximately $5 million in debt and/or equity capital to fully implement our business plan in the future and there are no assurances that we will be able to raise this capital. While we have engaged in discussions with various investment banking firms and venture capitalists to provide us these funds, as of the date of this report we have not reached any agreement with any party that has agreed to provide us with the capital necessary to effectuate our business plan. Our inability to obtain sufficient funds from external sources when needed will have a material adverse effect on our plan of operation, results of operations and financial condition.

Our cost to continue operations as they are now conducted is nominal, but these are expected to increase once we commence Phase I clinical trials. We do not have sufficient funds to cover the anticipated increase in these expenses. We need to raise additional funds in order to continue our existing operations, to initiate research and development activities, and to finance our plans to expand our operations for the next year. If we are successful in raising additional funds, our research and development efforts will continue and expand.

Subsequent Events

On July 15, 2015, the holder of a convertible note having a principal balance of $55,000 as of June 30, 2015 elected to convert $5,000 in principal amount and $260 in interest into 642,213 shares of $0.001 par value Common Stock leaving a principal balance of $50,000.

On July 17, 2015, we completed the process of increasing our authorized capital of $0.001 par value Common Stock from 200,000,000 shares to 500,000,000 shares.

Effective July 9, 2015, we executed an investment banking agreement with Emerging Growth Equities Ltd,, King of Prussia, PA, (“EGE”), whereby EGE has agreed to undertake a private offering of our securities to raise up to $5 million of capital for us on a best efforts basis. The agreement contains standard provisions for agreements of this kind, including the payment of placement agent fees equal to 8% of gross proceeds, plus the issuance of warrants to purchase 8% of the total securities sold in the private financing, plus payment of pre-approved expenses not to exceed $20,000.

Inflation

Although our operations are influenced by general economic conditions, we do not believe that inflation had a material effect on our results of operations during the six month period ended June 30, 2015.

Critical Accounting Estimates

The discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these consolidated financial statements requires us to make estimates and judgments that affect the amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. On an on-going basis, we evaluate our estimates based on historical experience and on various other assumptions that are believed 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 from these estimates under different assumptions or conditions. The following represents a summary of our critical accounting policies, defined as those policies that we believe are the most important to the portrayal of our financial condition and results of operations and that require management’s most difficult, subjective or complex judgments, often as a result of the need to make estimates about the effects of matters that are inherently uncertain.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

We are a smaller reporting company and are not required to provide the information under this item pursuant to Regulation S-K.

ITEM 4. CONTROLS AND PROCEDURES.

Disclosure Controls and Procedures - Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of the end of the period covered by this report.

These controls are designed to ensure that information required to be disclosed in the reports we file or submit pursuant to the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission, and that such information is accumulated and communicated to our management, including our CEO and CFO, as appropriate, to allow timely decisions regarding required disclosure.

Based on this evaluation, our CEO and CFO concluded that our disclosure controls and procedures were effective as of June 30, 2015, at the reasonable assurance level. We believe that our consolidated financial statements presented in this Form 10-Q fairly present, in all material respects, our financial position, results of operations, and cash flows for all periods presented herein.

Inherent Limitations - Our management, including our Chief Executive Officer and Chief Financial Officer, do not expect that our disclosure controls and procedures 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. The design of any system of controls is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within our company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdown can occur because of simple error or mistake. In particular, many of our current processes rely upon manual reviews and processes to ensure that neither human error nor system weakness has resulted in erroneous reporting of financial data.

Changes in Internal Control over Financial Reporting - There were no changes in our internal control over financial reporting during the six month period ended June 30, 2015, which were identified in conjunction with management’s evaluation required by paragraph (d) of Rules 13a-15 and 15d-15 under the Exchange Act, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

In February 2015 we filed an action in the Circuit Court of the 11th Judicial Circuit for Miami-Dade County, Florida against Justin Keener, d/b/a JMJ Financial, arising out of a convertible note that we issued to the defendant. The complaint alleges among other things, claims of usury, fraudulent inducement, breach of contract, and injunctive and declaratory relief. As of the date of this Report we have received a default and as required by law the judge has ordered that the parties hold a mediation meeting which is anticipated to take place the last week of August 2015.

We are a defendant to one outstanding matter of litigation but do not believe it presents any material potential liability. We are not party to any other material legal proceedings, nor have any such actions been threatened against us.

ITEM 1A. RISK FACTORS

We are a smaller reporting company and are not required to provide the information under this item pursuant to Regulation S-K.

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

During the six months ended June 30, 2015, we issued 52,921,409 shares of our Common Stock. Of these, 31,121,409 shares valued at $576,735 reducing debt by $287,804 and generating a loss on conversion of $288,931 for the period. We relied upon the exemption from registration provided by Section 4(a)(2) to issue these shares.

In March 2015, our Board of Directors authorized a private offering of Common Stock in Canada pursuant to Regulation S promulgated under the Securities Act of 1933, as amended, wherein we offered up to 60,000,000 shares of our Common Stock at an offering price of $0.015 Canadian per share for aggregate gross proceeds of up to $900,000 Canadian. As of June 30, 2015, we had accepted two subscriptions each of 10,000,000 shares for $150,000 Canadian, aggregating $300,000 Canadian or approximately $236,550 US. This offering will expire on September 20, 2015.

During the six month period ended June 30, 2015, we amended our Articles of Incorporation by authorizing 500,000 shares of $0.10 par value “Series B” Preferred stock. The stock gives the holder the right to 1,000 votes per share. In June 2015,. 500,000 shares of “Series B” Preferred Shares were issued to our CEO in exchange for services valued at $50,000.

Subsequent Events

On July 17, 2015, we completed the process of increasing our authorized capital of $0.001 par value Common Stock from 200,000,000 shares to 500,000,000 shares.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None

ITEM 4. MINE SAFETY DISCLOSURE

Not Applicable

ITEM 5. OTHER INFORMATION

None

ITEM 6. EXHIBITS

Exhibit No.			Description

31.1			Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.2			Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

32			Certification of Chief Executive Officer and Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

SIGNATURES

Pursuant to the requirements of Section 12 of the Securities and Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized on August 6, 2015.

	SUNSHINE BIOPHARMA, INC.

	By:	s/ Dr. Steve N. Slilaty
		Dr. Steve N. Slilaty,
		Principal Executive Officer


	By:	s/ Camille Sebaaly
		Camille Sebaaly, Principal Financial Officer and
		Principal Accounting Officer