Quarterly report pursuant to Section 13 or 15(d)

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (USD $)
 6 Months Ended
Apr. 30, 2014
Apr. 30, 2013
Reconciliation of net loss to net cash used in operating activities:    
Net loss $ (6,863,871) $ (4,571,440)
Stock option compensation to employees 989,407 1,027,832
Stock option compensation to consultants 887,699 427,128
Common stock issued to consultants 35,148 51,875
Common stock issued to pay interest on convertible debentures 61,778 34,761
Amortization of patents 151,840   
Amortized interest on patent acquisition obligations to interest expense 186,234   
Amortization of convertible debenture discount to interest expense 446,565 801,125
Loss on extinguishment of debt 482,915   
Change in value of derivative liability 2,310,704 (210,000)
Common stock issued to acquire patent license    42,000
Other (1,403) 35,809
Change in operating assets and liabilities:    
Accounts receivable (653,367)   
Prepaid expenses and other current assets 26,463 3,715
Accounts payable and accrued expenses (14,749) 508,858
Royalties and contingent legal fees payable 274,803   
Other liabilities    45,600
Net cash used in operating activities (1,679,834) (1,802,737)
Cash flows from investing activities:    
Disbursements to acquire short-term investments in certificates of deposit (2,700,000)   
Proceeds from sales of short-term investments in certificates of deposit 650,000 500,000
Other (1,329) 421
Net cash (used in) provided by investing activities (2,051,329) 500,421
Cash flows from financing activities:    
Proceeds from issuance of convertible debentures 3,500,000 1,765,000
Proceeds from sale of common stock    458,325
Proceeds from exercise of warrants to purchase common stock 149,985   
Proceeds from exercise of employee stock options 725 13,050
Payments to redeem convertible debentures (200,000)   
Net cash provided by financing activities 3,450,710 2,236,375
Net (decrease) increase in cash and cash equivalents (280,453) 934,059
Cash and cash equivalents at beginning of year 898,172 339,693
Cash and cash equivalents at end of period 617,719 1,273,752
Supplemental disclosure of financing activities:    
Fair value of debenture embedded conversion feature at date of issuance 1,570,000 1,180,000
Relative fair value of warrants issued with convertible debentures $ 513,112 $ 214,819