Quarterly report pursuant to Section 13 or 15(d)

Statements of Cash Flows (Unaudited)

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Statements of Cash Flows (Unaudited) (USD $)
 9 Months Ended
Sep. 30, 2012
Sep. 30, 2011
Cash flows from operating activities:    
Net loss $ (11,101,620) $ (5,739,546)
Adjustments to reconcile net loss to net cash used in operating activities:    
Technology access fee paid in common stock 5,798,001  
Accretion of discount on note payable to shareholder 483,559  
Depreciation and amortization 55,793 60,144
Stock-based compensation expense 1,057,218 1,058,327
Changes in operating assets and liabilities:    
Accounts receivable, net 20,265 78,642
Income tax receivable   362,218
Inventory, net 195,643 (198,846)
Prepaid expenses and other current assets 11,843 98,358
Accounts payable and accrued expenses (104,556) 29,004
Deferred revenue 112,879 148,197
Net cash used in operating activities (3,470,975) (4,103,502)
Cash flows from financing activities:    
Borrowings under note payable to shareholder 2,500,000  
Borrowings under convertible secured note payable to shareholder 750,000 4,000,000
Payments on short term notes payable (99,514) (121,335)
Payment of income taxes associated with stock based compensation (127,291)  
Net proceeds from issuance of common stock 11,913,442  
Restricted cash released, net 120,374 92,734
Net cash provided by financing activities 15,057,011 3,971,399
Net increase (decrease) in cash and cash equivalents 11,586,036 (132,103)
Cash and cash equivalents at beginning of the period 171,739 (132,103)
Cash and cash equivalents at end of the period 11,757,775  
Supplemental disclosure of cash flow information    
Interest paid 2,936 4,296
Non-cash investing and financing activities:    
Borrowing under short term notes payable for prepaid expense 134,914 126,739
Par value of restricted stock granted as stock compensation   20
Conversion of note payable and accrued interest to common shares and warrants 11,275,196  
Discount on note payable to shareholder for warrants issued 483,559  
Par value of restricted stock forfeited $ 5  
Griffin Securities Inc
    
Non-cash investing and financing activities:    
Fair market value of 771,169 warrants issued to Griffin Securities, Inc. as a reduction of paid-in capital from issuance of common stock $ 1,850,806