UNITED STATES


SECURITIES AND EXCHANGE COMMISSION


Washington, D.C. 20549





FORM 10-Q





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





For the quarterly period ended June 30, 2011


or





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





For the transition period from __________ to __________





Commission File Number: 000-30424





PANACEA GLOBAL, INC.


(Exact name of registrant as specified in its charter)




Nevada

33-0680443(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification No.)88 Toporowski Ave., Richmond Hill

Ontario, Canada

L4S2V6(Address of principal executive offices)

(Zip Code)





Registrant’s telephone number, including area code: (416) 450-6414





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, and (2) has been subject to such filing requirements for the past 90 days.


Yes x No  ̈





Indicate by a check mark whether the registrant has submitted electronically and posted on its corporate website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§229.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).


Yes  ̈ No  ̈





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




Large Accelerated Filer   ̈
Accelerated Filer   ̈
Non-Accelerated Filer   ̈
Smaller Reporting Company  x





Indicate by check mark whether the registrant is a shell company as defined in Rule 12b-2 of the Exchange Act.


Yes  ̈ No x





There were 96,463,586shares of the Registrant’s Common Stock outstanding at August 10, 2011.








PANACEA GLOBAL, INC.





QUARTERLY REPORT ON FORM 10-Q


JUNE 30, 2011





TABLE OF CONTENTS




PAGEPART 1— FINANCIAL INFORMATIONItem 1.
Financial Statements (Unaudited)

F-1Item 2.
Management’s Discussion and Analysis of Financial Condition and Results of Operations

3Item 3.
Quantitative and Qualitative Disclosures About Market Risk

5Item 4.
Controls and Procedures

5PART II— OTHER INFORMATIONItem 1.
Legal Proceedings

6Item 1A.
Risk Factors

6Item 2.
Unregistered Sales of Equity Securities and Use of Proceeds

6Item 3.
Defaults Upon Senior Securities

6Item 4.
(Removed and Reserved)

6Item 5.
Other Information

6Item 6.
Exhibits

7SIGNATURES

8


1


CAUTIONARY STATEMENT ON FORWARD-LOOKING INFORMATION





This Quarterly Report on Form 10-Q (this “Report”) contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Forward-looking statements discuss matters that are not historical facts. Because they discuss future events or conditions, forward-looking statements may include words such as “anticipate,” “believe,” “estimate,” “intend,” “could,” “should,” “would,” “may,” “seek,” “plan,” “might,” “will,” “expect,” “predict,” “project,” “forecast,” “potential,” “continue” negatives thereof or similar expressions. Forward-looking statements speak only as of the date they are made, are based on various underlying assumptions and current expectations about the future and are not guarantees. Such statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, level of activity, performance or achievement to be materially different from the results of operations or plans expressed or implied by such forward-looking statements.





We cannot predict all of the risks and uncertainties. Accordingly, such information should not be regarded as representations that the results or conditions described in such statements or that our objectives and plans will be achieved and we do not assume any responsibility for the accuracy or completeness of any of these forward-looking statements. These forward-looking statements are found at various places throughout this Report and include information concerning possible or assumed future results of our operations, including statements about potential acquisition or merger targets; business strategies; future cash flows; financing plans; plans and objectives of management; any other statements regarding future acquisitions, future cash needs, future operations, business plans and future financial results, and any other statements that are not historical facts.





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 this Report. All subsequent written and oral forward-looking statements concerning other matters addressed in this Report 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 Report.





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.





CERTAIN TERMS USED IN THIS REPORT





When this report uses the words “we,” “us,” “our,” and the “Company,” they refer to Panacea Global, Inc. and its subsidiaries.  “SEC” refers to the Securities and Exchange Commission.




2


PART I— FINANCIAL INFORMATION





Item 1.Financial Statements.





Basis of Presentation





The accompanying statements are presented in accordance with U.S. generally accepted accounting principles for interim financial information and the instructions to Form 10-Q and Regulation S-X.  Accordingly, they do not include all of the information and footnotes required by U.S. generally accepted accounting principles for complete financial statements.  In the opinion of management, all adjustments (consisting only of normal occurring adjustments) considered necessary in order to make the financial statements not misleading, have been included. Operating results for the three months ended June 30, 2011 are not necessarily indicative of results that may be expected for the year ending December 31, 2011.





Panacea Global, Inc.(A Development Stage Company)Consolidated Balance Sheets
  As at


As atThursday,

June 30,

2011


Friday,

December 31,

2010(Unaudited)AssetsCurrentCash

$
60,358


$
-Prepaid expenses and deposits


55,821



-Total Current Assets


116,179



-Capital assets


26,578



-Global diagnostic license (Note 6)


50,000,000



50,000,000Total Non-Current Assets


50,026,578



50,000,000Total Assets

$
50,142,757


$
50,000,000LiabilitiesCurrentAcounts payable and accrued liabilities

$
70,136


$
66,402License fee payable (Note 5)


1,862,500



2,500,000Total Liabilities


1,932,636



2,566,402Stockholders' EquityPreferred Stock, $0.001 par value; 100,000 shares authorized,


-



-none issued (Note 7)Capital stock, $0.001 par value; 300,000,000 shares authorized;


91,364



89,36491,363,586 issued and outstanding (December 31, 2010 – 89,363,586)(Note 7)Additional paid in capital


47,947,936



47,449,936Subscription received in advance (Note 7)


751,476



-Deficit accumulated during the development stage


(589,123
)


(105,702
)Accumulated other comprehensive income (loss)


8,468



-Total Stockholders' Equity


48,210,121



47,433,598Total Liabilities and Stockholders' Equity

$
50,142,757


$
50,000,000
  The accompanying notes are an integral part of these financial statements
 
 F-1
  Panacea Global, Inc.(A Development Stage Company)Consolidated Statements of Operations
  For the

Three Months Ended


For the

Six Months Ended


For the Period Ended February 5, 2010 (inception) to


For the Period Ended February 5, 2010 (inception) toJune 30,

2011


June 30,

2010


June 30,

2011


June 30,

2010


June 30,

2011(Unaudited)


(Unaudited)


(Unaudited)


(Unaudited)


(Unaudited)Revenue

$
-


$
-


$
-


$
-


$
-ExpensesProfessional fees


49,484



41,402



90,980



41,402



157,382Cost of reorganization


-



-



-



39,300



39,300Filing fees


1,366



-



6,417



-



6,417Office and general


231,742



-



233,050



-



233,050Salaries and benefits


86,049



-



152,974



-



152,974Total expenses


368,641



41,402



483,421



80,702



589,123Net loss


(368,641
)


(41,402
)


(483,421
)


(80,702
)


(589,123
)Foreign currency adjustment


8,468



-



8,468



-



8,468Comprehensive loss


(360,173
)


(41,402
)


(474,953
)


(80,702
)


(580,655
)Net loss per share - basic and diluted

$
(0.00
)

$
(0.00
)

$
(0.01
)

$
(0.00
)

$
(0.01
)Weighted number of shares outstanding - basic and diluted


91,363,586



40,548,484



90,755,851



34,543,856



74,296,221
  The accompanying notes are an integral part of these financial statements
  F-2
  Panacea Global, Inc.(A Development Stage Company)Consolidated Statements of Stockholders' Equity
  Common Shares


Subscriptions Received In Advance


Stock Amount


Additional

Paid in

Capital


Other Comprehensive Income(Loss)


Accumulated Deficit During the Development Stage


Total Shareholders' EquityBalance, February 5, 2010 (inception)


-


$
-


$
-


$
-


$
-


$
-


$
-Issuance of common stock for services


39,300,000



-



39,300



-



-



-



39,300Issuance of common stock for license


35,500,000



-



35,500



47,464,500



0



-



47,500,000Reverse merger with MoneyLogix


14,563,586



-



14,564



(14,564
)


-



-



-Net loss


-







-



-







(105,702
)


(105,702
)Balance, December 31, 2010


89,363,586


$
-


$
89,364


$
47,449,936


$
-


$
(105,702
)

$
47,433,598Issuance of common stock for cash


2,000,000



-



2,000



498,000



-



-



500,000Subscriptions received in advance


-



751,476



-



-



-



-



751,476Foreign currency exchange adjustment


-



-



-



-



8,468



-



8,468Net loss


-



-



-



-



-



(483,421
)


(483,421
)Balance June 30, 2011 (unaudited)


91,363,586


$
751,476


$
91,364


$
47,947,936


$
8,468


$
(589,123
)

$
48,210,121
  The accompanying notes are an integral part of these financial statements
  F-3
  Panacea Global, Inc.(A Development Stage Company)Consolidated Statements of Cash Flows
  For the Six Months Ended

January 1,

2011 to

June 30,

2011


For the Period Ended

February 5,

2010 (inception) to

June 30,

2010


For the Period Ended

February 5,

2010 (inception) to

June 30,

2011(Unaudited)


(Unaudited)


(Unaudited)Cash Flows from Operating ActivitiesNet loss


(483,421
)


(80,702
)


(589,123
)Effect of exchange rate on cash


8,468



-



8,468(474,953
)


(80,702
)


(580,655
)Adjustments to reconcile net loss to net cash used in operating activities:Stock issued for services


-



39,300



39,300Prepaid expenses and deposits


(55,821
)


-



(55,821
)Acounts payable and accrued liabilities


3,734



41,402



70,136License fee payable (Note 5)


(637,500
)


-



(637,500
)Net cash used in operating activities


(1,164,540
)


-



(1,164,540
)Cash Flows from Financing ActivitiesSubscriptions received in advance (Note 7)


751,476



-



751,476Issuance of common stock


500,000



-



500,000Net cash provided by financing activities


1,251,476



-



1,251,476Cash Flows from Investing ActivitiesPurchases of capital assets


(26,578
)


-



(26,578
)Net cash used in investing activities


(26,578
)


-



(26,578
)Net change in cash


60,358



-



60,358Cash, beginning of period


-



-



-Cash, end of period

$
60,358


$
-


$
60,358
  The accompanying notes are an integral part of these financial statements
  F-4
  
 PANACEA GLOBAL, INC.
 (A Development Stage Company)
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
 JUNE 30, 2011
 
 1. NATURE OF OPERATIONS AND ORGANIZATION
 
 Nature of Operations
 
 MoneyLogix Group, Inc. ("MoneyLogix" or the “Company”), (formerly Homelife, Inc.), which registered a change of name with the State of Nevada on January 29, 2008 was formerly known as Homelife, Inc. and is organized under the laws of the State of Nevada.
 
 MoneyLogix Group, Inc. entered into a share exchange agreement which closed on June 30, 2010 with Panacea Global, Inc. (“Panacea”), a Delaware private corporation incorporated on February 5, 2010. The reverse merger transaction effected a change of control of the Company. The accounting acquirer is Panacea and the historical operations of the Company are the operations of Panacea.  Pursuant to the terms of the share exchange agreement, the parties agreed to the following:
  1.
MoneyLogix agreed to issue 74,800,000 shares of its common stock to the stockholders of Panacea Global, Inc. in exchange for 100% of Panacea issued and outstanding stock making Panacea a wholly owned subsidiary of the Company on June 30, 2010.
 The Company is a development stage company that has currently acquired the global rights except for the United States of America for early detection cancer tests.  Panacea is a 100% wholly owned subsidiary of MoneyLogix.
 
 Effective June 2, 2011, MoneyLogix Group, Inc. registered a change of name with the State of Nevada to Panacea
 Global, Inc. Effective June 15, 2011, the trading symbol for the Company on the OTC Bulletin Board changed from "MLXG" to “PANG”.
  2. BASIS OF PRESENTATION
 
 The Company has not earned any revenues from limited principal operations and accordingly, the Company's activities have been accounted for as those of a "Development Stage Enterprise" as set forth in ASC 915Accounting and Reporting by Development Stage Enterprises.  Among the disclosures required by ASC 915 are that the Company's financial statements be identified as those of a development stage company, and that the statements of operations, stockholders' deficit and cash flows disclose activity since the date of the Company's inception.
  3. GOING CONCERN
  These financial statements have been prepared assuming the Company will continue on a going-concern basis. The Company has incurred losses since inception and the ability of the Company to continue as a going-concern depends upon its ability to develop profitable operations and to continue to raise adequate financing. Accumulated net losses from inception to June 30, 2011 totaled $589,123.  In order for the Company to meet its liabilities as they come due and to continue its operations, the Company is solely dependent upon its ability to generate such financing.
  4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
  The accounting policies of the Company are in accordance with accounting principles generally accepted in the United States of America. Presented below are those policies considered particularly significant:
 
 Basis of Consolidation and Presentation
 
 The accompanying consolidated financial statements include the accounts of the Company, and its wholly-owned subsidiary Panacea (a Delaware incorporated Company) and Panacea Global Inc. (a Canadian incorporated Company).  All inter-company transactions and balances have been eliminated upon consolidation.
 
 F-5
 
 PANACEA GLOBAL, INC.
 (A Development Stage Company)
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
 JUNE 30, 2011
  4.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES  (continued)
 
 Basis of Consolidation and Presentation (continued)
 
 The consolidated financial statements of the Company included herein have been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Certain  information and footnote disclosures normally included in financial statements prepared in conjunction with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to make the information presented not misleading. These consolidated financial statements should be read in conjunction with the annual audited financial statements and the notes thereto included in the Company’s annual report on Form 10-K.
 
 The accompanying unaudited interim financial statements reflect all adjustments of a normal and recurring nature which are, in the opinion of management, necessary to present fairly the financial position, results of operations and cash flows of the Company for the interim periods presented. The results of operations for these periods are not necessarily comparable to, or indicative of, results of any other interim period or for the fiscal year taken as a whole. Certain information that is not required for interim financial reporting purposes has been omitted.
 
 Translation of Foreign Currency Financial Statements and Foreign Currency Transactions
 
 The financial statements of the Company’s international subsidiary have been translated into United States dollars by translating balance sheet accounts at year end and period end exchange rates except for non-current assets which are translated at historical exchange rates, and statement of operations accounts at average exchange rates for the periods. Foreign currency transaction gains and losses are reflected in the equity section of the Company’s consolidated balance sheet in Accumulated Other Comprehensive Income. The balance of the foreign currency translation adjustment, included in Accumulated Other Comprehensive Income (Loss), was $8,468 for the three and six months ended June 30, 2011.  For the 3 months ended June 30, 2010 and the period from inception (February 5, 2010) through June 30, 2010 there were no foreign currency translation adjustments recorded due to the limited nature of operations during these periods.
 
 Earnings or Loss Per Share
 
 The Company accounts for earnings per share pursuant to ASC 260-10-05,Earnings per Share, which requires disclosure on the financial statements of "basic" and "diluted" earnings (loss) per share. Basic earnings (loss) per share are computed by dividing net income (loss) by the weighted average number of common stock outstanding for the period. Diluted earnings (loss) per share is computed by dividing net income (loss) by the weighted average number of common stock outstanding plus common stock equivalents (if dilutive) related to stock options and warrants for each period.
 
 There were no dilutive financial instruments for the period from February 5, 2010 (inception) to June 30, 2011.
 
 Financial Instruments
 
 In accordance with ASC 825-10-50, Defining Fair Value Measurement, the estimated fair value of financial instruments has been determined by the Company using available market information and valuation methodologies. Considerable judgment is required in estimating fair value. Accordingly, the estimates may not be indicative of the amounts the Company could realize in a current market exchange. As of June 30, 2011, the carrying value of accrued liabilities, and license fee payable approximate their fair value because of the short-term maturity of these instruments.
 
 In accordance with ASC 820-10, Defining Fair Value Measurement, the Company adopted the standard which
 
 F-6
 
 PANACEA GLOBAL, INC.
 (A Development Stage Company)
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
 JUNE 30, 2011
 
 4.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES  (continued)
 
 Financial Instruments (continued)
 
 defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles and expands disclosures about fair value measurements.
 
 Income Taxes
 
 The Company accounts for income taxes pursuant to ASC 740-10, Accounting for Income Taxes. Deferred tax assets and liabilities are recorded for differences between the financial statements and tax basis of the assets and liabilities as well as loss carryforward that will result in taxable or deductible amounts in the future based on enacted tax laws and rates. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. Income tax expense is recorded for the amount of income tax payable or refundable for the period increased or decreased by the change in deferred tax assets and liabilities during the period.
 
 Impairment of Long-lived Assets
 
 In accordance with ASC 360-10-05, Accounting for the Impairment or Disposal of Long-Lived Assets, long-lived assets to be held and used are analyzed for impairment whenever events or changes in circumstances indicate that the related carrying amounts may not be recoverable. The Company evaluates whether events and circumstances have occurred that indicate possible impairment. If there are indications of impairment, the Company uses future undiscounted cash flows of the related asset or asset grouping over the remaining life in measuring whether the assets are recoverable. In the event such cash flows are not expected to be sufficient to recover the recorded asset values, the assets are written down to their estimated fair value. Long-lived assets to be disposed of are reported at the lower of carrying amount or fair value of asset less cost to sell. The Company evaluated the Global Diagnostic License on April 30, 2010, no events or changes in circumstances indicate that it is impaired since it was acquired on March 24, 2010.
 
 Use of Estimates
 
 The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the 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. Actual results could differ from those estimates. These estimates are reviewed periodically, and, as adjustments become necessary, they are reported in earnings in the period in which they become known. The accounting estimates that require management’s most significant judgments are the valuation of the Global Diagnostics license and measurement of accrued liabilities.
 
 Capital Assets
 
 Capital assets are initially recorded at cost.  Depreciation is provided using the declining balance method at rates intended to amortize the cost of assets over their estimated useful lives.
  Method

RateComputer equipment
declining balance


30
%Leasehold improvements
straight-line


20
%
 
 In the year of acquisition, depreciation is taken as assets are available for use.
 
 F-7
  PANACEA GLOBAL, INC.
 (A Development Stage Company)
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
 JUNE 30, 2011
  4.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES  (continued)
 
 Recent Accounting Pronouncements
 
 Changes to accounting principles generally accepted in the United States of America (U.S. GAAP) are established by the Financial Accounting Standards Board (FASB) in the form of accounting standards updates (ASU’s) to the FASB’s Accounting Standards Codification.
 
 The Company has assessed the applicability and impact of all ASU’S and they have been determined to be either not applicable or are expected to have minimal impact on our consolidated financial position and results of operations.
  5.GLOBAL DIAGNOSTIC LICENSE
 
 On March 24, 2010, the Company entered into a license agreement with Panacea Pharmaceuticals Inc. (“Pharmaceuticals”) to acquire the global diagnostic license (“GDL”), with rights to sublicense worldwide, except for the United States of America.  GDL allows the Company to develop, market and use licensed products related to HAAH based laboratory tests.
 
 In consideration for the GDL, the Company issued 35,500,000 common shares and will pay Pharmaceuticals a license fee of $2,500,000, due within 30 days of the Company raising a minimum $10,000,000 equity investment.  One-half of any equity investments raised shall be remitted to Pharmaceuticals, until the license fee is paid in full. The aggregate consideration paid and therefore fair value of the GDL equates $50,000,000.  Further, the Company will pay Pharmaceuticals 25% of all sublicensing revenue and will purchase all conforming reagent at a cost of $20 per test or 10% of the sale price of the individual test with a minimum $8.00 test price.
 
 Management obtained valuation of the license conducted by third party professional valuation services. According to the valuation, the fair value of the license was about $74 million on December 31, 2007. On March 24, 2010, the acquisition date, management re-evaluated the assumptions in the original valuation and updated the projection based on current circumstance and the Company’s business plan. As at June 30, 2011, management is of the opinion there has been no change to those circumstances.
 
 As at June 30, 2011 the Company has made license fee payments to Pharmaceuticals of $637,500.
 
 6.INTANGIBLE ASSET
 
 The Company’s intangible asset consists of the GDL, as described in Note 5, which contains certain issued and pending patent rights. Upon commencement of licensed services to customers, amortization will be taken over the estimated useful life of the respective patent rights, which vary and are determined on a country-by-country basis.
 
 As at

February 5,

2010

(inception)


Acquired


Accumulated Amortization


As at

December 31,

2010


Accumulated Amortization


As at

June 30,

2011Global Diagnostic License


-


$
50,000,000



-


$
50,000,000



-


$
50,000,000
 
 As at June 30, 2011, the Company has not commenced any services relating to GDL, and as a result, no amortization has been recorded.
 
 F-8
  PANACEA GLOBAL, INC.
 (A Development Stage Company)
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
 JUNE 30, 2011
  7. CAPITAL STOCK
  a) Authorized
 100,000 Class A Preferred shares with a par value of $0.001. There were no shares issued and outstanding at June 30, 2011.
 
 300,000,000 Common shares of $0.001 par value.
 
 b) Issued
 91,363,586 Common Shares
 
 Monetary Transactions
 
 On February 25, 2011, 2,000,000 shares were issued by the Company for $0.25 per share generating $500,000 in equity financing.
 
 Subscriptions Received in Advance
 
 On April 10, 2011, the Company and certain investors entered into a Subscription Agreement pursuant to which such investors purchased two million (2,000,000) units, with each unit being offered and sold at $0.25 per unit and each unit consisting of (i.) one share of the Company’s common stock; and (ii.) one warrant to purchase one share of the Company’s common stock at an initial exercise price equal to $0.25 per share.
 
 Additionally, on April 15, 2011, the Company and certain investors entered into a second Subscription Agreement pursuant to which such investors purchased six hundred thousand (600,000) units, with each unit being offered and sold at $0.25 per Unit and each Unit consisting of (i) one share of the Company’s common stock and (ii) one warrant to purchase one share of the Company’s common stock at an initial exercise price equal to $0.25 per share.
 
 On April 16, 2011 the Company and certain Investors entered into a third Subscription Agreement (the “Third Agreement”). Pursuant to the Third Agreement, the Investor purchased five hundred thousand (500,000) Units, with each unit being offered and sold at $0.50 per unit and each unit consisting of (i) one share of the Company’s common stock and (ii) one warrant to purchase one share of the Company’s common stock at an initial exercise price equal to $0.50 per share.
 
 As at June 30, 2011, the above noted units have not been issued and $751,476 of subscription proceeds were received in advance.
  Non Monetary Transactions
 
 The following non monetary transactions were completed by the Company on a service for stock basis. It is the Company’s accounting policy that in certain circumstances, stock, generally valued at the 5 day moving average price of the trading value of the stock at the time the associated agreement was executed, might be issued for the procurement of assets, provision of advisory and other services.
 
 On February 5, 2010, the Company issued 22,000,000 common shares at a price of $0.001 per share based on the value of the services provided, for total amount of $22,000 to various suppliers.  On June 30, 2010 the Company recorded an additional 17,300,000 common shares at a price of $0.001 per share based on the value of the services provided, for total amount of $17,300 to the same various suppliers.
 
 On March 24, 2010 the Company issued 18,000,000 common shares which translates into a price of $2.63 per share based on the value of the asset transferred for a total amount of $47,500,000 to Panacea Pharmaceuticals.  On June 30, 2010 the company recorded an additional 17,500,000 common shares to Panacea Pharmaceuticals at a price of $0.001 per share as an adjustment to the purchase price per share.  The adjusted share price after the adjustment of 17,500,000 common shares is $1.33.
 
 F-9
  PANACEA GLOBAL, INC.
 (A Development Stage Company)
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
 JUNE 30, 2011
  8. INCOME TAXES
 
 The Company accounts for income taxes in accordance with ASC 740-20. ASC 740-20 prescribes the use of the liability method whereby deferred tax asset and liability account balances are determined based on differences between the financial reporting and tax basis of assets and liabilities and are measured using the enacted tax rates. The effects of future changes in tax laws or rates are not anticipated.
 
 Under ASC 740-20 income taxes are recognized for the following: a) amount of tax payable for the current year, and b) deferred tax liabilities and assets for future tax consequences of events that have been recognized differently in the financial statements than for tax purposes.
 
 The Company has income tax losses available to be applied against future years income as a result of the losses incurred since inception. However, due to the losses incurred since inception and expected future operating results, management determined that it is more likely than not that the deferred tax asset resulting from the tax losses available for carry forward will not be realized through the reduction of future income tax payments. Accordingly a 100% valuation allowance has been recorded for income tax losses available for carry forward.
 
 As of June 30, 2011, the Company did not have any amounts recorded pertaining to uncertain tax positions.  The Company files federal and provincial income tax returns in Canada and federal, state and local income tax returns in
 the U.S., as applicable.  The Company may be subject to a reassessment of federal and provincial income taxes by Canadian tax authorities for a period of three to five years from the date of the original notice of assessment in respect of any particular taxation year.  In certain circumstances, the U.S. federal statute of limitations can reach beyond the standard three year period.  U.S. state statutes of limitations for income tax assessment vary from state to state.
 
 9.CAPITAL ASSETS
 
 Cost


Accumulated Depreciation


June 30,

2011 Net

Book Value


December 31,

2010 Net

Book ValueComputer equipment


2,007



-



2,007



-Leasehold improvements


24,571



-



24,571



-26,578



-



26,578



-
 
 As of June 30, 2011, no capital asset has been placed in service. As such, the Company has not begun to recognize depreciation expense.
 
 10.SUBSEQUENT EVENTS
 
 On July 7, 2011, the Company entered into an exclusive master purchase agreement with a third party within the Republic of Belarus to provide the exclusive right to use the Company’s blood, serum and tissue testing services to diagnose and monitor cancer. The initial term of the Agreement expires on December 31, 2011 (the “Initial Term”). Following the expiration of the Initial Term, the Agreement will renew automatically on an annual basis, provided minimum purchase thresholds are met, unless either party gives sixty (60) days prior written notice of its intention not to renew the Agreement.  The Agreement provides that the third party will be required to meet a minimum purchase amount threshold for each year the Agreement is in effect. In that regard, during the Initial Term, the threshold is $280,000. Thereafter, in the period ranging from January 1, 2012 to December 31, 2012 (the “First Renewal Term”), the threshold is $3,500,000. During the period ranging from January 1, 2013 to December 31, 2013 (the “Second Renewal Term”), the threshold is of $5,250,000. Finally, in each renewal term commencing after the Second Renewal Term, the threshold is $7,000,000.
 
 On July 26, 2011, pursuant to the Company's 2011 Omnibus Incentive Plan, the Company issued 2,000,000 stock options to its directors. These options vest and become exercisable on January 26, 2012 at an exercise price of $0.55 per share and expire on July 26, 2021.
  F-10




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





The following discussion provides information which management believes is relevant to an assessment and understanding of our results of operations and financial condition.  The discussion should be read along with our financial statements and notes thereto contained elsewhere in this Report.  The following discussion and analysis contains forward-looking statements, which involve risks and uncertainties.  Our actual results may differ significantly from the results, expectations and plans discussed in these forward-looking statements.





Overview





We are a corporation incorporated under the laws of Nevada.  On June 30, 2010 we entered into a share exchange agreement with Panacea Global, Inc., a privately held Delaware corporation (“Panacea Delaware”), and the shareholders of Panacea Delaware pursuant to which we acquired all of the outstanding capital stock of Panacea Delaware from the Panacea Delaware shareholders and Panacea Delaware became our wholly owned subsidiary and our operating business.  Through Panacea Delaware, we are a biopharmaceutical company that anticipates selling early detection cancer tests through our licensing agreement with Panacea Pharmaceuticals, Inc. (“Pharmaceuticals”).





On March 24, 2010, Panacea Delaware entered into a licensing agreement (the “Licensing Agreement”) with Pharmaceuticals.  Pursuant to the Licensing Agreement, Panacea Delaware was granted the exclusive right to develop, use, and market Pharmaceuticals’ HAAH based cancer diagnostic technologies, with rights to sublicense worldwide, except for the United States of America.  In consideration for the License Agreement, Panacea Delaware issued 35,500,000 shares of its common stock to Pharmaceuticals and is obligated to pay Pharmaceuticals a license fee of $2,500,000, due within 30 days of the Company raising a minimum $10,000,000 equity investment.  One-half of any equity investments raised shall be remitted to Pharmaceuticals, until the license fee is paid in full.  The aggregate consideration paid and therefore fair value of the License Agreement equals $50,000,000.  Further, the Company will pay Pharmaceuticals 25% of all sublicensing revenue and will purchase all conforming reagent at a cost of $20 per test or 10% of the sale price of the individual test with a minimum $8.00 test price.





We hope to market and sell products through strategic partnerships with companies in different countries by entering into sublicensing agreements to sell our products.  We may enter into sublicensing agreements with one or more third parties under all or some of the related Pharmaceuticals patents.  Additionally, we hope to develop stand alone operations in certain countries including Canada.





On June 2, 2011, we filed a Certificate of Amendment to our Articles of Incorporation with the State of Nevada changing the Company’s name to Panacea Global, Inc.





As of June 30, 2011, we are in the development stage and have negative working capital, have not earned any revenues from operations to date and have accumulated a deficit our development stage operations.





Exclusive Master Purchase Agreement with Palmverse Limited





On July 7, 2011, we, through our wholly owned subsidiary, Panacea Delaware, entered into an exclusive master purchase agreement with Palmverse Limited, a Belarus corporation (“Palmverse”) (the “Agreement”) to provide Palmverse with the exclusive right to use the Company’s blood, serum and tissue testing services to diagnose and monitor cancer (the “Cancer Testing Products”) within the Republic of Belarus. We have agreed to provide Palmverse with an exclusive right to become the sole purchaser of the Company’s Cancer Testing Products within the Republic of Belarus. The initial term of the Agreement expires on December 31, 2011 (the “Initial Term”). Following the expiration of the Initial Term, the Agreement will renew automatically on an annual basis, provided Palmverse meets minimum purchase amounts, unless either party gives sixty (60) days prior written notice of its intention not to renew the Agreement.





The Agreement provides that Palmverse will be required to meet a minimum purchase amount threshold of the Cancer Testing Products for each year the Agreement is in effect. In that regard, during the Initial Term, Palmverse will be required to purchase a minimum of $280,000 in Cancer Testing Products. Thereafter, in the period ranging from January 1, 2012 to December 31, 2012 (the “First Renewal Term”), Palmverse is required to purchase a minimum of $3,500,000 in Cancer Testing Products. During the period ranging from January 1, 2013 to December 31, 2013 (the “Second Renewal Term”), Palmverse is required to purchase a minimum of $5,250,000 in Cancer Testing Products. Finally, in each renewal term commencing after the Second Renewal Term, Palmverse is required to purchase a minimum of $7,000,000 in Cancer Testing Products.





Results of Operations





As of June 30, 2011, the Company had not begun its business operations in connection with the Licensing Agreement.  Accordingly, we have not had any revenues during the six months ended June 30, 2011 or during the period from February 5, 2010 (inception) to June 30, 2011.




3




Total expenses for the three and six months ended June 30, 2011 were $368,641 and $483,421, respectively, as compared to total expenses of $41,402 and $80,702 for the three months ended June 30, 2010 and the period from February 5, 2010 (inception) to June 30, 2010, respectively.  The increase in total expenses during fiscal 2011 was primarily attributable to office and general expenses of $233,050 and salary and benefit expenses of $152,974, which were not present during the period from February 5, 2010 (inception) to June 30, 2010.  Since inception, the Company has incurred total expenses of $589,123.





The Company recorded a net loss of $368,641 and $483,421 for the three and six months ended June 30, 2011, respectively.  We recorded a net loss for the three months ended June 30, 2010 of $41,402 and a net loss of $80,702 for the period from February 5, 2010 (inception) to June 30, 2010.





Liquidity and Capital Resources





At June 30, 2011 the Company had $60,358 cash in hand, $55,821 of prepaid expenses and deposits and $50,142,757 in assets in connection with the $50,000,000 License Agreement and capital assets totaling $26,578. The License Agreement allows the Company to develop market and use licensed products related to HAAH based laboratory tests. Comparatively, at December 31, 2010, we had no assets except for the $50,000,000 in License Agreement.





At June 30, 2011 the Company had liabilities of $1,932,636 comprised of the license fee payable of $1,862,500 and accounts payable and accrued liabilities totaling $70,136. Comparatively at December 31, 2010, we had $2,566,402 in liabilities comprised of the license fee payable of $2,500,000 and accounts payable and accrued liabilities totaling $66,402.





Net cash used in operating activities during the six months ended June 30, 2011 was $1,164,540 compared to net cash of $0 during the period from February 5, 2010 (inception) to June 30, 2010. Net cash provided by financing activities during the six months ended June 30, 2011 was $1,251,476 due to the sale shares of our common stock.  No cash was provided by financing activities during the period from February 5, 2010 (inception) to June 30, 2010. Net Cash used in investing activities amounted to $26,578 for the six months ended June 30, 2011 which related to the Company's investment in capital assets that had not been placed in service as of June 30, 2011.  There were no investing activities for the period from February 5, 2010 (inception) through June 30, 2010.





As there were no revenues from operating activities as of June 30, 2011, we must rely upon the issuance of common stock and additional capital contributions from shareholders and/or loans from shareholders and third-party lenders to meet our working capital needs. It is expected by management that we will need to rely upon new capital contributions to pay our liabilities.





Critical Accounting Policies





Our financial statements and related public financial information are based on the application of accounting principles generally accepted in the United States (“GAAP”). GAAP requires the use of estimate; assumptions, judgments and subjective interpretations of accounting principles that have an impact on the assets, liabilities, and revenue and expense amounts reported. These estimates can also affect supplemental information contained in our external disclosures including information regarding contingencies, risk and financial condition.  We believe our use of estimates and underlying accounting assumptions adhere to GAAP and are consistently and conservatively applied.  We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances. Actual results may differ materially from these estimates under different assumptions or conditions.  We continue to monitor significant estimates made during the preparation of our financial statements.





Recent Accounting Pronouncements





Changes to GAAP accounting are established by the Financial Accounting Standards Board (FASB) in the form of accounting standards updates (“ASU’s”) to the FASB’s Accounting Standards Codification.





The Company has assessed the applicability and impact of all ASU’S and they have been determined to be either not applicable or are expected to have minimal impact on our consolidated financial position and results of operations.





Going Concern





These financial statements have been prepared assuming the Company will continue on a going-concern basis. The Company has incurred losses since inception and the ability of the Company to continue as a going-concern depends upon its ability to develop profitable operations and to continue to raise adequate financing. Accumulated Losses from inception to June 30, 2011 total $589,123 Management is actively targeting sources of additional financing to provide continuation of the Company’s operations. In order for the Company to meet its liabilities as they come due and to continue its operations, the Company is solely dependent upon its ability to generate such financing.





There can be no assurance that the Company will be able to continue to raise funds, in which case the Company may be unable to meet its obligations. Should the Company be unable to realize its assets and discharge its liabilities in the normal course of business, the net realizable value of its assets may be materially less than the amounts recorded in these financial statements.




4




The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue in existence.





Impairment of Long-lived Assets





In accordance with ASC 360-10-05, Accounting for the Impairment or Disposal of Long-Lived Assets, long-lived assets to be held and used are analyzed for impairment whenever events or changes in circumstances indicate that the related carrying amounts may not be recoverable. The Company evaluates whether events and circumstances have occurred that indicate possible impairment. If there are indications of impairment, the Company uses future undiscounted cash flows of the related asset or asset grouping over the remaining life in measuring whether the assets are recoverable. In the event such cash flows are not expected to be sufficient to recover the recorded asset values, the assets are written down to their estimated fair value. Long-lived assets to be disposed of are reported at the lower of carrying amount or fair value of asset less cost to sell. The Company evaluated the Global Diagnostic License on April 30, 2010, no events or changes in circumstances indicate that it is impaired since it was acquired on March 24, 2010.





Off-Balance Sheet Arrangements





None.




Item 3. Quantitative and Qualitative Disclosures About Market Risk.





Smaller reporting companies are not required to provide the information required by this item.





Item 4. Controls and Procedures.





Evaluation of Disclosure Controls and Procedures





We maintain disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act, that are designed to ensure that information required to be disclosed in our reports filed or submitted to the SEC under the Exchange Act is recorded, processed, summarized and reported within the time periods specified by the SEC’s rules and forms, and that information is accumulated and communicated to management, including our principal executive officer and principal financial officer as appropriate, to allow timely decisions regarding required disclosures. Our principal executive officer and principal financial officer evaluated the effectiveness of disclosure controls and procedures as of June 30, 2011, pursuant to Rule 13a-15(b) under the Exchange Act.  Based on that evaluation, the principal executive officer and principal financial officer concluded that, as of the end of the period covered by this report, the Company’s disclosure controls and procedures are not effective to ensure that information required to be included in our periodic SEC filings is recorded, processed, summarized, and reported within the time periods specified in the SEC rules and forms.  Specifically, we identified the following material weaknesses in our internal control over financial reporting as of June 30, 2011:





·
Reliance upon independent financial reporting consultants for review of critical accounting areas and disclosures and material non-standard transaction.


·
Lack of sufficient accounting staff which results in a lack of segregation of duties necessary for an effective system of internal control.





A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.





A system of controls, no matter how well designed and operated, cannot provide absolute assurance that the objectives of the system of controls are met, and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected.





Remediation of Material Weaknesses in Internal Control Over Financial Reporting





In order to remedy our existing internal control deficiencies, as our finances allow, we will hire a Chief Financial Officer and additional accounting staff.





Changes in Internal Controls over Financial Reporting





We have not yet made any changes in our internal controls over financial reporting that occurred during the period covered by this report on Form 10-Q that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.




5




PART II—OTHER INFORMATION





Item 1. Legal Proceedings.





Currently, to the Company’s knowledge, there are no legal proceedings pending or threatened against the Company. However, from time to time, we may become involved in various lawsuits and legal proceedings which arise in the ordinary course of business.  Litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm our business.





Item 1A. Risk Factors.





Smaller reporting companies are not required to provide the information required by this item.





Item 2. Unregistered Sales Of Equity Securities And Use Of Proceeds





On April 10, 2011, the Company and certain investors entered into a subscription agreement pursuant to which such investors purchased two million (2,000,000) units, with each unit being offered and sold at $0.25 per unit and each unit consisting of (i.) one share of the Company’s common stock; and (ii.) one warrant to purchase one share of the Company’s common stock at an initial exercise price equal to $0.25 per share.





Additionally, on April 15, 2011, the Company and certain investors entered into a second subscription agreement pursuant to which such investors purchased six hundred thousand (600,000) units, with each unit being offered and sold at $0.25 per unit and each unit consisting of (i) one share of the Company’s common stock and (ii) one warrant to purchase one share of the Company’s common stock at an initial exercise price equal to $0.25 per share.





On April 16, 2011 the Company and certain investors entered into a third subscription agreement. Pursuant to the third agreement, the investors purchased five hundred thousand (500,000) units, with each unit being offered and sold at $0.50 per unit and each unit consisting of (i) one share of the Company’s common stock and (ii) one warrant to purchase one share of the Company’s common stock at an initial exercise price equal to $0.50 per share.





Such securities were not registered under the Securities Act of 1933.  The issuance of these shares was exempt from registration, pursuant to Section 4(2) of the Securities Act of 1933 and Regulation S promulgated under the Securities Act of 1933 (“Regulation S”).  These securities qualified for exemption under Regulation S since the purchasers all reside outside of the United States. These securities qualified for exemption under Section 4(2) of the Securities Act of 1933 since the issuance of the securities by us did not involve a public offering. The offering was not a “public offering” as defined in Section 4(2) due to the insubstantial number of persons involved in the deal, size of the offering, manner of the offering and number of securities offered. We did not undertake an offering in which we sold a high number of securities to a high number of investors. In addition, these shareholders had the necessary investment intent as required by Section 4(2) since they agreed to and received share certificates bearing a legend stating that such securities are restricted pursuant to Rule 144 of the 1933 Securities Act. This restriction ensures that these securities would not be immediately redistributed into the market and therefore not be part of a “public offering.”





Based on an analysis of the above factors, we have met the requirements to qualify for exemption under Section 4(2) of the Securities Act of 1933, as well as Regulation S, for this transaction.





Item 3. Defaults Upon Senior Securities.





None.





Item 4. (Removed and Reserved).








Item 5. Other Information.





None.


6




Item 6 Exhibits





Exhibit No.

Description10.1

Master Purchase Agreement between Panacea Global, Inc. and Palmverse Limited, dated July 7, 2011 [incorporated by reference to Exhibit 10.1 filed with the Company’s Current Report on Form 8-K filed on July 12, 2011]31.1

Certification of Principal Executive Officer Pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as amended, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 200231.2

Certification of Principal Financial Officer Pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as amended, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 200232.1

Certification of the Principal Executive Officer and Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002101

Interactive Data File (Form 10-Q for the quarterly period ended June 30, 2011 furnished in XBRL) (1)








7





SIGNATURES





Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, there unto duly authorized.




PANACEA GLOBAL, INC.Dated: August 15, 2011
By:
/s/ Mahmood MoshiriMahmood MoshiriChief Executive Officer, President,

Chief Medical Officer and Director


Dated: August 15, 2011
By:
/s/ Binnay SethiBinnay SethiVice President and Director




8