Report of Foreign Issuer (6-k)

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 6-K

REPORT OF FOREIGN ISSUER

Pursuant to Rule 13a-16 or 15d-16 of

The Securities Exchange Act of 1934

For August 2014

PACIFIC THERAPEUTICS LTD.

(Translation of registrant’s name into English)

409 Granville Street, Suite #1500

Vancouver, BC, V6C-1T2 Canada

Tel: 604-738-1049

Fax: 604-738-1094

(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:

Form 20-F x Form 40-F o

Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934:

Yes o No x

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b):

Pacific Therapeutics has distributed Exhibits 99.1 to 99.4 (inclusive) to the applicable Canadian securities regulators and to shareholders who requested same, to disseminate its interim financial statements and related materials for the Quarter Ended June 30, 2014

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Dated: August 28, 2014

		PACIFIC THERAPEUTICS LTD



		By:	/s/ Douglas H. Unwin
		Name:	Douglas H. Unwin
		Title:	CEO

SUBMITTED HEREWITH

Exhibits

99.1	June 30, 2014 Financial Statements
99.2	June 30, 2014 Management Discussion and Analysis
99.3	CEO Certification
99.4	CFO Certification

EXHIBIT 99.1

PACIFIC THERAPEUTICS LTD.

(A Development Stage Company)

CONDENSED INTERIM FINANCIAL STATEMENTS

Six month period ended June 30, 2013, 2014

(Expressed in Canadian Dollars)

Unaudited – Prepared by Management

PACIFIC THERAPEUTICS LTD.

Condensed Interim Financial Statements

30, June 2014

(Unaudited – See “Notice to Reader” below)

In accordance with National Instrument 51-102 released by the Canadian Securities Administrators, the Company discloses that its external auditors have not reviewed the condensed interim financial statements for the period ended 30 June 2014.

PACIFIC THERAPEUTICS LTD.

(A Development Stage Company)

Condensed Interim Statements of Financial Position

(Expressed in Canadian Dollars)

AS AT:	Jun 30, 14			Dec 31, 13
	$			$
ASSETS
CURRENT
Cash and cash equivalents		1,905			180,692
Goods and Services Tax/Harmonized Sales Tax Receivable		2,223			7,391
Prepaid expenses and deposits		13,920			36,605
		18,048			224,688
NON-CURRENT ASSETS
PROPERTY AND EQUIPMENT (Note 3)		1,835			2,443
INTANGIBLE ASSETS (Note 4)		61,777			59,913
		81,660			287,044

LIABILITIES
CURRENT
Trade payable and accrued liabilities		193,615			226,201
Convertible note (Note 6)		-			30,900
Due to related parties (Note 5)		554,198			470,087
		747,813			727,188
SHAREHOLDERS' DEFICIENCY
Share capital (Note 7)		2,699,210			2,699,210
Warrant and option reserve (Note 7)		221,512			123,704
Deficit accumulated during the development stage		(3,586,875	)		(3,263,058	)
		(666,153	)		(440,144	)
		81,660			287,044

Nature and Continuance of Operations (Note 1)

Subsequent Events (Note 10)

On behalf of the Board:

“Douglas H. Unwin”	Director	“Doug Wallis”	Director
Douglas H. Unwin		Doug Wallis

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

PACIFIC THERAPEUTICS LTD.

(A Development Stage Company)

Condensed Interim Statements of Loss and Comprehensive Loss

(Expressed in Canadian Dollars)

	Three Months ended			Three Months ended			Six Months ended			Six Months ended
	Jun 30, 14			Jun 30, 13			Jun 30, 14			Jun 30, 13
Expenses
Advertising and promotion	$	3,719		$	16,562		$	15,165		$	36,662
Amortization of property and equipment		203			855			608			1,709
Amortization of intangible assets		1,725			957			2,682			1,915
Bank charges and interest		1,291			4,678			3,284			9,281
Donation		-			-			500			-
Insurance		6,997			5,615			13,994			9,795
Investor relations		11,250			23,750			11,250			46,250
Office and miscellaneous		609			1,434			2,885			3,377
Professional fees		48,213			23,514			75,272			39,268
Rent and occupancy costs		3,600			2,402			7,200			6,003
Share based payments		25,868			34,847			97,808			34,847
Telephone and utilities		550			215			719			712
Transfer agent		2,294			1,808			4,832			3,257
Travel		3,273			200			7,844			936
Wages and benefits		40,000			40,560			80,000			75,560
	$	149,592		$	157,397		$	324,043		$	269,572
Interest expense
Interwest loan interest	$	-		$	900		$	-		$	1,800
	$	-		$	900		$	-		$	1,800
Other Expenses (Income)
Exchange loss/(gain)	$	-		$	46		$	(226	)	$	46
Loss/(gain) on derivative liability (Note 6)		-			(5,695	)		-			13,255
Write-off of license (Note 4)		-			-			-			42,510

Net Loss and Comprehensive Loss	$	(149,592	)	$	(152,648	)	$	(323,817	)	$	(327,183	)

Loss per share Basic and Diluted	$	(0.00	)	$	(0.01	)	$	(0.01	)	$	(0.01	)
Weighted average number of common shares outstanding		37,456,825			25,861,550			37,456,825			25,861,550

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

PACIFIC THERAPEUTICS LTD.

(A Development Stage Company)

Condensed Interim Statements of Changes in Shareholders’ Deficiency

(Expressed in Canadian Dollars)

	Number of common shares		Share capital			Share Subscriptions received			Warrant and option reserve			Deficit			Total
			$			$			$			$			$
Balance at December 31, 2012		22,586,825		1,995,716			30,000			206,212			(2,662,918	)		(430,990	)
Common shares issued for cash @ $0.05		1,800,000		90,000			(30,000	)		-			-			60,000
Share issue costs		-		(7,030	)		-			2,030			-			(5,000	)
Loss for the period		-		-			-			-			(174,535	)		(174,535	)
Balance at March 31, 2013		24,386,825		2,078,686			-			208,242			(2,837,453	)		(550,525	)
Common shares issued for cash @ $0.05		2,200,000		110,000			-			-			-			110,000
Share issue costs		-		(19,907	)		-			9,906			-			(10,001	)
Share based payments		-		-			-			34,847			-			34,847
Loss for the period		-		-			-			-			(152,648	)		(152,648	)
Balance at June 30, 2013		26,586,825		2,168,779			-			252,995			(2,990,101	)		(568,327	)
Common shares issued for cash @ $0.05		-		-			54,000			-			-			54,000
Share based payments		-		-			-			4,986			-			4,986
Loss for the period		-		-			-			-			(104,895	)		(104,895	)
Balance at September 30, 2013		26,586,825		2,168,779			54,000			257,981			(3,094,996	)		(614,236	)
Common shares issued for cash @ $0.05		9,830,000		491,500			(54,000	)		-			-			437,500
Share issue costs		-		(13,069	)		-			4,070			-			(8,999	)
Shares exchanged for debt @ $0.05		1,040,000		52,000			-			-			-			52,000
Share based payments		-		-			-			2,359			-			2,359
Shares and expiry of options and finders warrants		-		-			-			(140,706	)		140,706			-
Loss for the period		-		-			-			-			(308,768	)		(308,768	)
Balance at December 31, 2013		37,456,825		2,699,210			-			123,704			(3,263,058	)		(440,144	)
Share based payments		-		-			-			71,940			-			71,940
Loss for the period		-		-			-			-			(174,225	)		(174,225	)
Balance at March 31, 2014		37,456,825		2,699,210			-			195,644			(3,437,283	)		(542,429	)
Share based payments		-		-			-			25,868			-			25,868
Loss for the period													(149,592	)		(149,592	)
Balance at June 30, 2014		37,456,825		2,699,210			-			221,512			(3,586,875	)		(666,153	)

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

PACIFIC THERAPEUTICS LTD.

(A Development Stage Company)

Condensed Interim Statements of Cash Flows

(Expressed in Canadian Dollars)

	Six Months ended			Six Months ended
	Jun 30, 14			Jun 30, 13
	$			$
Cash flows used in operating activities
Net loss and comprehensive loss		(323,817	)		(327,183	)
Adjustments for items not affecting cash
Amortization of property and equipment		608			1,709
Amortization of intangible assets		2,682			1,915
Share based payments		97,808			34,847
Loss on derivative liability		-			13,255
Changes in non-cash working capital balances
Advances		-			(1,500	)
Goods and Services Tax/Harmonized Sales Tax recoverable		5,168			(1,467	)
Prepaid expenses		22,685			81,244
Write-off of license		-			42,510
Accounts payable and accrued liabilities		51,525			39,618
		(143,341	)		(115,052	)
Cash flows used in investing activities
Additions to intangible assets		(4,546	)		(4,218	)
		(4,546	)		(4,218	)
Cash flows from/(used in) financing activities
Issue of common shares for cash		-			173,063
Subscriptions received		-			(30,000	)
Issuance of finders' warrants		-			11,936
Promissory note		(30,900	)		8,844
Shareholder demand loan		-			(45,553	)
Due to shareholders					(6,947	)
		(30,900	)		111,343

Change in cash and cash equivalents		(178,787	)		(7,927	)
Cash and cash equivalents, beginning of period		180,692			9,854
Cash and cash equivalents, end of period		1,905			1,927

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

Pacific Therapeutics Ltd.

(A Development Stage Company)

Notes to Condensed Interim Financial Statements

Six Months Ended June 30, 2014 and 2013

1.	NATURE AND CONTINUANCE OF OPERATIONS

Pacific Therapeutics Ltd. (the “Company" or "PTL") was incorporated under the laws of the Province of British Columbia, Canada on September 12, 2005. The Company is a development stage company focused on developing proprietary drugs to treat certain types of lung disease including fibrosis. On October 14, 2011, the Company became a reporting company in British Columbia and was approved by the Canadian Securities Exchange (“CSE”) and opened for trading on November 16, 2011.

PTL has financed its cash requirements primarily from share issuances and payments from research collaborators. The Company's ability to realize the carrying value of its assets is dependent on successfully bringing its technologies to market and achieving future profitable operations, the outcome of which cannot be predicted at this time. It will be necessary for the Company to raise additional funds for the continuing development of its technologies.

The condensed interim financial statements have been prepared on a going concern basis, which contemplates continuity of operations and the realization of assets and settlement of liabilities in the ordinary course of business. The Company is subject to risks and uncertainties common to drug discovery companies, including technological change, potential infringement on intellectual property of and by third parties, new product development, regulatory approval and market acceptance of its products, activities of competitors and its limited operating history. Management is aware, in making its assessment, of material uncertainties related to events or conditions that may cast significant doubt upon the Company’s ability to continue as a going concern. The condensed interim financial statements do not include any adjustments that might result from the outcome of this uncertainty.

2.	STATEMENT OF COMPLIANCE AND BASIS OF PRESENTATION

These condensed interim financial statements were approved and authorized for issue by the Board of Directors on August 27, 2014.

(a)	Statement of Compliance

These unaudited condensed interim financial statements, including comparatives, have been prepared in accordance with International Financial Reporting Standard 34 “Interim Financial Reporting” (“IAS 34”) using accounting policies consistent with the International Financial Reporting Standards (“IFRS”) issued by the International Accounting Standards Board (“IASB”) and Interpretations of the IFRS Interpretations Committee.

These unaudited condensed interim financial statements do not include all of the information required of a full annual financial report and should be read in conjunction with the annual financial statements of the Company for the year ended December 31, 2013.

(b)	Basis of Presentation

These condensed interim financial statements were prepared on a historical cost basis and are presented in Canadian dollars which is the Company’s functional currency. All financial information has been rounded to the nearest dollar.

(c)	Use of Estimates

The preparation of condensed interim financial statements in conformity with IFRS requires management to make estimates and assumptions that affect the amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the condensed interim financial statements and the reported amounts of revenues and expenditures during the reporting periods. Although these estimates are based on management’s best knowledge of current events and actions, actual results ultimately may differ from those estimates.

Pacific Therapeutics Ltd.

(A Development Stage Company)

Notes to Condensed Interim Financial Statements

Six Months Ended June 30, 2014 and 2013

3.	PROPERTY AND EQUIPMENT

Cost
Balance at:	Computer Equipment		Furniture and Fixtures		Leasehold Improvements		Lab Equipment		Total

December 31, 2012	$	5,876	$	-	$	-	$	5,784	$	11,660
December 31, 2013	$	5,876	$	-	$	-	$	6,200	$	12,076
June 30, 2014	$	5,876	$	-	$	-	$	6,200	$	12,076

Amortization
Balance at:	Computer Equipment		Furniture and Fixtures		Leasehold Improvements		Lab Equipment		Total

December 31, 2012	$	5,662	$	-	$	-	$	1,550	$	7,212
Amortization for the year		96		-		-		2,325		2,421

December 31, 2013	$	5,758	$	-	$	-	$	3,875	$	9,633
Amortization for the period		27		-		-		581		608

June 30, 2014	$	5,785	$	-	$	-	$	4,456	$	10,241

Carrying amounts
Balance at:	Computer Equipment		Furniture and Fixtures		Leasehold Improvements		Lab Equipment		Total

December 31, 2012	$	214	$	-	$	-	$	4,234	$	4,448
December 31, 2013	$	118	$	-	$	-	$	2,325	$	2,443
June 30, 2014	$	91	$	-	$	-	$	1,744	$	1,835

Pacific Therapeutics Ltd.

(A Development Stage Company)

Notes to Condensed Interim Financial Statements

Six Months Ended June 30, 2014 and 2013

4.	INTANGIBLE ASSETS

Cost
	Technology Licenses (i)			Patents (ii)		Total

December 31, 2012	$	42,510		$	64,315	$	106,825
Additions		-			13,569		13,569
Write-off		(42,510	)		-		(42,510	)

December 31, 2013	$	-		$	77,884	$	77,884
Additions		-			4,546		4,546

June 30, 2014	$	-		$	82,430	$	82,430

Amortization
	Technology Licenses (i)			Patents (ii)		Total

December 31, 2012	$	-		$	13,263	$	13,263
Amortization for the year		-			4,708		4,708

December 31, 2013	$	-		$	17,971	$	17,971
Amortization for the period		-		$	2,682		2,682

June 30, 2014	$	-		$	20,653	$	20,653

Carrying amounts
	Technology Licenses (i)			Patents (ii)		Total

December 31, 2012	$	42,510		$	51,052	$	93,562
December 31, 2013	$	-		$	59,913	$	59,913
June 30, 2014	$	-		$	61,777	$	61,777

(i)

On January 9, 2013, the technology license agreement with Dalhousie University was terminated due to breach of contract for non-payment of maintenance amounts due, accordingly the technology license was written down to nil.

(ii)

Due to a finite life of patents which begins from the date of application; the Company amortizes all patent costs over the expected life of the patent.

Pacific Therapeutics Ltd.

(A Development Stage Company)

Notes to Condensed Interim Financial Statements

Six Months Ended June 30, 2014 and 2013

(iii)

The Company is currently pursuing a patent application for the compositions and methods of treating fibro proliferative disorders. Costs of this application incurred to date are $78,507 (2013 - $77,884). The application is still pending as at March 31, 2014, however due to a finite life of the patent which begins from the date of application; the Company is amortizing these costs over the expected life of the patent.

5.	DUE TO RELATED PARTIES

Due to related parties as at June 30, 2014 consists of $554,198 (2013 - $470,087). These amounts consist of short term loans, services rendered and expenses paid on behalf of the Company by shareholders and or officers of the Company and are unsecured, non-interest bearing and payable on demand.

6.	CONVERTIBLE NOTE AND DERIVATIVE LIABILITY

On September 24, 2012 the Company issued a convertible note (the “Note”) with a face value of $30,000, issued 200,000 warrants (“Bonus Warrants”) and received $30,000 in cash. The Bonus Warrants with an exercise price of $0.22 expire on September 24, 2014. The Note had a term of one year and was repaid in full in January 2014.

The holder of the Note may convert the whole Note or any portion into units at any time. Each unit will consist of 1 common share (the “Share Option”) and 1 warrant (the “Warrant Option”), with each Warrant Option exercisable to acquire an additional common share for a period of 2 years from the date the Warrant Option was issued. Subject to regulatory approval the conversion price per unit will be at a 25% discount to the ten day weighted average price of the Company’s shares at the date of conversion. Subject to regulatory approval the exercise price per Warrant Option will be at a 25% premium to the ten day weighted average price of the issuer’s shares at the date of conversion. Each Bonus Warrant is exercisable to acquire an additional common share for a period of 2 years from the closing date at a price of $0.22. The Note accrues interest at the rate of 1% per month, payable in quarterly installments.

The fair value of the Bonus Warrants and Share Options were determined using the Black-Scholes Pricing Model. The Black-Scholes Pricing Model is based on several subjective assumptions including the expected life of the option and expected future stock price volatility. Changes in these assumptions can materially affect the estimated fair value of the Company’s stock options. The estimated fair value of the Bonus Warrants was calculated on the grant date as $13,238. The estimated fair value of the share options was calculated on the grant date as $18,232.

The fair value of the Warrant Options was determined using the Geske Price Model. The Geske Price Model is based on several subjective assumptions including the expected life of the option and expected future stock price volatility. Changes in these assumptions can materially affect the estimated fair value of the Company’s stock options. The estimated value of the Warrant Option was calculated on the grant date as $11,600.

Pacific Therapeutics Ltd.

(A Development Stage Company)

Notes to Condensed Interim Financial Statements

Six Months Ended June 30, 2014 and 2013

Upon initial recognition, the Company bifurcated the $30,000 proceeds between the component parts of the convertible note using the relative fair value method as follows:

		Estimated Value				Allocation of Proceeds
Current Liabilities
Convertible Loan	Face value of note	$	30,000	41	%	$	12,317
Derivative Liability	Share option		18,232	25	%		7,485
Derivative Liability	Warrant option		11,600	16	%		4,763
Warrant and option reserve	Bonus warrants		13,238	18	%		5,435
		$	73,070	100	%	$	30,000

The discount on the component parts of the convertible note are accredited as interest expense over the one year term of the note. As at December 31, 2013 the derivative liability was re-measured to fair value. This resulted in a gain on derivative liability being recognized on the face of the condensed interim financial statements of $30,889.

7.	SHARE CAPITAL

Authorized

Unlimited

1,500,000

1,000,000

Class A common shares without par value

Class B Series I preferred shares without par value

Class B Series II preferred shares without par value

Issued

37,456,825

NIL

Class A common shares without par value

Class B Series I preferred shares without par value

Class B Series II preferred shares without par value

Class A Common Shares

On February 13, 2013 the Company closed the first tranche of a non-brokered private placement and issued 1,800,000 units at $0.05 per unit for gross proceeds of $90,000, of which $30,000 was recorded during the year ended December 31, 2012. Each unit is comprised of one common share and one-half a purchase warrant, each whole warrant being exercisable for one common share at an exercise price of $0.22 until February 12, 2015. The Company paid finder’s fees of $5,000 and issued 100,000 finders warrants to finders in the first tranche. The finders’ warrants have the same terms as the warrants that are part of the above Units. The fair value of the 100,000 finders’ warrants was $2,742 as estimated at the date of issue using the Black-Scholes pricing model.

On May 1, 2013, the Company closed the second tranche of a non-brokered private placement and issued an additional 2,200,000 units at $0.05 per unit for gross proceeds of $110,000. Each unit is comprised of one common share and one-half a purchase warrant, each whole warrant being exercisable for one common share at an exercise price of $0.22 until May 1, 2015. The Company paid finder’s fees of $10,000 and issued 200,000 finders warrants to finders in the second tranche. The finders’ warrants have the same terms as the warrants that are part of the above Units. The fair value of the 200,000 finders’ warrants was $5,413 as estimated at the date of issue using the Black-Scholes pricing model.

Pacific Therapeutics Ltd.

(A Development Stage Company)

Notes to Condensed Interim Financial Statements

Six Months Ended June 30, 2014 and 2013

On October 8, 2013 the Company closed the first tranche and issued 2,160,000 units for gross proceeds of $108,000. 2,160,000 warrants were issued with an expiration date of October 8, 2016. Each unit is comprised of one common share and one share purchase warrant, each warrant being exercisable for one common share at an exercise price of $0.10 for three years from the closing date of the placement. Finders’ fees were paid in the amount of $4,500 cash and issued 90,000 finders warrants having the same terms as the warrants issued as part of the units. The fair value of the 100,000 finders’ warrants was $2,646 as estimated at the date of issue using the Black-Scholes pricing model.

On October 18, 2013 the Company closed the second tranche and issued 1,980,000 units for gross proceeds of $99,000. 1,980,000 warrants were issued with an expiration date of October 18, 2016. Each unit is comprised of one common share and one share purchase warrant, each warrant being exercisable for one common share at an exercise price of $0.10 for three years from the closing date of the placement Finders fees were paid in the amount of $2,000 cash and issued 40,000 finders warrants having the same terms as the warrants issued as part of the units. The fair value of the 40,000 finders’ warrants was $3,306 as estimated at the date of issue using the Black-Scholes pricing model.

On November 5, 2013 the Company closed the third tranche and issued 6,730,000 units for gross proceeds of $336,500. 6,730,000 warrants were issued with an expiration date of November 5, 2016. Each unit is comprised of one common share and one share purchase warrant, each warrant being exercisable for one common share at an exercise price of $0.10 for three years from the closing date of the placement Finders’ fees were paid in the amount of $2,500 cash and issued 50,000 finders warrants having the same terms as the warrants issued as part of the units. The fair value of the 50,000 finders’ warrants was $1,899 as estimated at the date of issue using the Black-Scholes pricing model.

Share subscriptions received:

On December 31, 2013 all shares had been issued for funds received and the share subscriptions received was $Nil (2012 - $30,000) for a shares subscription for Nil units (2012 – 600,000) as part of a private placement of 1,800,000 units that was completed on February 7, 2013.

Stock options and share based compensation:

As at June 30, 2014 and December 31, 2013, the following stock options were outstanding:

Expiry Date	Exercise Price $	Jun 30, 14	Dec 31, 13
4-Nov-14	0.27	150,000	150,000
5-Mar-15	0.27	375,000	375,000
11-Jun-15	0.06	500,000	-
10-Jan-17	0.10	400,000	-
3-Jul-17	0.10	475,000	475,000
21-Dec-17	0.10	450,000	450,000
4-Apr-18	0.10	350,000	350,000
16-Sep-18	0.10	100,000	100,000
7-Mar-19	0.10	525,000	-
Balance	0.12	3,325,000	1,900,000

The options outstanding and exercisable at June 30, 2014, have a weighted average remaining contractual life of 3.3 years (2013 – 3.1 years). Stock option activity was as follows:

Pacific Therapeutics Ltd.

(A Development Stage Company)

Notes to Condensed Interim Financial Statements

Six Months Ended June 30, 2014 and 2013

	Six months ending				Twelve months ending
	Jun 30, 14				Dec 31, 13
	Options Outstanding		Exercise Price $		Options Outstanding			Exercise Price $
Balance at January 1		1,900,000	$	0.15		1,675,000		$	0.18
Exercised		-		-		-			-
Expired/Cancelled						(225,000	)		0.27
Issued		1,425,000		0.09		450,000			0.10
Balance at period end		3,325,000	$	0.12		1,900,000		$	0.15

The fair value of share based awards is determined using the Black-Scholes Option Pricing model. The model utilizes certain subjective assumptions including the expected life of the option and expected future stock price volatility. Changes in these assumptions can materially affect the estimated fair value of the Company’s stock options.

The Company used the Black-Scholes Option Pricing Model for the grants on January 10, 2014, March 3, 2014 and June 11, 2014 and for multiple stock option grants occurring 2013. The assumptions used in the Black-Scholes Option Pricing Model for employees, directors and consultants were:

	Six months ending	Twelve months ending
	Jun 30, 14	Dec 31, 13
Dividend yield	0%	0%
Expected volatility	299% -301%	164% - 166%
Risk free interest rate	1.63%	1.23% - 1.87%
Expected life in years	5	5
Grant date fair value per share	$0.075 - $0.08	$0.08 - $0.09
Forfeiture rate	4%	4%

Pacific Therapeutics Ltd.

(A Development Stage Company)

Notes to Condensed Interim Financial Statements

Six Months Ended June 30, 2014 and 2013

Warrants

As at June 30, 2014 and December 31, 2013, the following share purchase warrants were issued and outstanding:

Expiry Date	Exercise Price $	June 30, 2014		December 31, 2013
31-Jul-14	$0.15	2,473,334	(1)	2,473,334
28-Aug-14	$0.25	60,000	(2)	60,000
16-Nov-14	$0.15	600,000	(3)	600,000
19-Jun-14	$0.22	56,666		56,666
20-Jun-14	$0.22	732,670		732,670
21-Sep-14	$0.22	747,166		747,166
24-Sep-14	$0.22	200,000		200,000
12-Feb-15	$0.22	1,000,000		1,000,000
1-May-15	$0.22	1,300,000		1,300,000
1-Oct-16	$0.22	2,160,000		2,160,000
8-Oct-16	$0.10	90,000		90,000
18-Oct-16	$0.10	1,980,000		1,980,000
18-Oct-16	$0.10	40,000		40,000
5-Nov-16	$0.10	6,730,000		6,730,000
5-Nov-16	$0.10	50,000		50,000
		18,219,836		18,219,836

(1)	On January 6, 2014 the Company extended the expiry date of 2,473,334 warrants from January 31, 2014, to July 31, 2014.

(2)	On January 6, 2014 the Company extended the expiry date of 60,000 warrants from February 28, 2014, to August 28, 2014.

(3)	On January 18, 2013 the Company extended the expiry date of 600,000 warrants from May 16, 2014, to November 16, 2014.

The warrants outstanding and exercisable at June 30, 2014, have a weighted average remaining contractual life of 1.5 years (2013 – 1.9 years). Warrant activity was as follows:

	Six months ending				Twelve months ending
	June 30, 2014				December 31, 2013
	Warrants Outstanding		Exercise Price $		Warrants Outstanding			Exercise Price $
Opening balance		18,219,836		0.15		5,272,059			0.17
Expired		-		0.15		(602,223	)		0.15
Exercised		-		0.15					0.15
Modified		-		0.15		-			-
Modified		-		0.15		-			-
Issued		-		0.22		13,550,000			0.14
Closing balance		18,219,836		0.15		18,219,836			0.15

Pacific Therapeutics Ltd.

(A Development Stage Company)

Notes to Condensed Interim Financial Statements

Six Months Ended June 30, 2014 and 2013

Loss per share

The weighted average number of shares outstanding for purposes of calculating basic and diluted loss per share at June 30, 2014 was 37,456,825 (2013 – 23,526,825).

8.	RELATED PARTY TRANSACTIONS AND BALANCES

All transactions with related parties are in the normal course of operations.

Details of the transactions between the Company and its related parties are disclosed below:

(a) Related Party Transactions

Six months ended June 30,	2014		2013

Legal fees incurred from a consultant and director of the Company	$	446	$	Nil

(b) Related Party Balances

Balances are due on demand with no fixed term, security or interest.

	30-Jun-14		31-Dec-13

Amounts owing to CFO of the Company for loans and consulting, accounting fees and interest on ISA.	$	103,724	$	86,760
Amounts owing to a director of the Company for legal fees		17,117		17,117
Amounts owing to a director of the Company for consulting fees		10,500
Amounts owing to a director of the Company for interest on ISA		2,964
Amount owing to the CEO and director of the Company for loans, salary, expenses and interest on ISA.		419,893		366,210
	$	554,198	$	470,087

Six months ended June 30,	2014		2013
Salary paid or accrued CEO	$	80,000	$	75,000
Consulting fees paid or accrued CFO		18,000		16,500
Accounting fees paid or accrued to a company controlled by CFO		3,000		-
Share-based payments		67,835		34,847

Total key management personnel compensation	$	168,835	$	126,347

Pacific Therapeutics Ltd.

(A Development Stage Company)

Notes to Condensed Interim Financial Statements

Six Months Ended June 30, 2014 and 2013

During the six months ended June 30, 2014 the Company granted 500,000, 5 year $0.10 incentive stock options that vested at date of grant to officers and directors and 500,000, 1 year $0.06 incentive options that vested at date of grant to and officer and director (During the twelve months ended December 31, 2013, the Company granted 450,000, 5 year $0.10 incentive stock options that vested at date of grant to officers and directors (Note 7).

9.	FINANCIAL INSTRUMENTS AND RISK

As at June 30, 2014, the Company’s financial instruments consist of cash and cash equivalents, trade payables, and due to related parties.

The carrying value of cash and cash equivalents, trade payables, and due to related parties approximate their fair values because of the short term nature of these instruments.

Credit Risk

Financial instruments that potentially subject the Company to concentrations of credit risks consist principally of cash and cash equivalents. To minimize the credit risk the Company places these instruments with a high credit quality financial institution.

Liquidity Risk

The Company’s financial liabilities consist of $545,306 due to related parties (Note 8) and $202,507 due to third parties. The amounts due to third parties consist of $23,118 due in 30 - 90 days, and $193,615 90 days and over.

Foreign Exchange Risk

The Company is not exposed to foreign exchange risk on its financial instruments.

Interest Rate Risk

At June 30, 2014, the Company is not exposed to significant interest rate risk as its interest bearing debt is at fixed rates.

10.	SUBSEQUENT EVENTS

On August 5, 2014 the Company announceda non-brokered Offering of the Company’s capital of up to 8,000,000 Units at a price of $0.05 per Unit for aggregate proceeds of CAD $400,000. Each Unit will consist of one common share and one warrant to purchase a common share. One warrant may be exercised to purchase a common share for $0.15 for up to one year. The Company may pay finders a fee consisting of cash and warrants from the proceeds of the proposed Offering. All of the Units issued will be subject to a four-month hold period.

EXHIBIT 99.2

PACIFIC THERAPEUTICS LTD.

MANAGMENTS’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Six-Month Ended June 30, 2014

Overview

This MD&A has been prepared as of August 27, 2014 and the following information should be read in conjunction with the Issuer’s un-audited financial statements for the quarter ended June 30, 2014 together with the notes thereto. The Issuer’s financial statements for the period have been prepared in accordance with International Financial Reporting Standards (IFRS). This discussion contains forward-looking statements that involve certain risks and uncertainties. Statements regarding future events, expectations and beliefs of management and other statements that do not express historical facts are forward-looking statements. In this discussion, the words “believe”, “may”, “will”, “estimate”, “continue”, “anticipate”, “intend”, “expect”, “plan”, “predict”, “potential” and similar expressions, as they relate to the Issuer, its business and management, are intended to identify forward looking statements. The Issuer has based these forward-looking statements largely on its current expectations and projections about future events and financial trends affecting the financial condition of the business. Forward-looking statements should not be read as a guarantee of future performance or results, and will not necessarily be accurate indications of the times at, or by, which such performance or results will be achieved. Forward looking statements are based on information available at the time those statements are made and/or management’s good faith belief as of that time with respect to future events, and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements.

Except as may be required by applicable law or stock exchange regulation, the Issuer undertakes no obligation to update publicly or release any revisions to these forward looking statements to reflect events or circumstances after the date of this document or to reflect the occurrence of unanticipated events. Accordingly, readers should not place undue reliance on forward-looking statements. If the Issuer updates one or more forward-looking statements, no inference should be drawn that additional updates will be made with respect to those or other forward-looking statements. Additional information relating to the Issuer, is available by accessing the SEDAR website at www.sedar.com.

Business Overview and Strategy

The Issuer is a development stage specialty pharmaceutical company. The Issuer is focused on developing late stage clinical therapies and in-licensed novel compounds for Fibrosis, Erectile Dysfunction (ED) and other indications. The Issuer’s lead compound for Fibrosis, PTL-202 is a combination of already approved drugs with a well established safety profile. PTL-202 has completed an initial clinical trial. The Issuer’s lead product for Erectile Dysfunction PTL-2015 is an oral dissolving version of a top selling therapy for ED. PTL-2015 has completed a pilot bioavailability study in humans. The Issuer’s pipeline includes PTL-303, a novel drug for the treatment of Liver Cirrhosis. PTL-303 has shown efficacy in cellular assays.

The Issuer will continue to operate virtually, outsourcing all non-core activities such as pre-clinical research and clinical trials and manufacturing. The Issuer will continue to build core skills in managing clinical development of therapies, licensing and commercialization. The Issuer will use its skills, taking in-licensed approved and late stage drug candidates through mid stage human clinical trials. The Issuer currently is focused on therapies for rare fibrosis indications including Idiopathic Pulmonary Fibrosis (IPF), Liver Cirrhosis, Scleroderma Associated Pulmonary Fibrosis, Lung Transplant Rejection as well as ED. The Issuer’s strategy is to sell or out-license its product candidates and technologies after completing Phase 2 clinical trial proof of principal studies. At this stage of development the value of product candidates has been maximized in relation to the capital spent to develop them. In the case of PTL-2015 the strategy is to complete the required clinical trials and register the product for marketing approval prior to out licensing.

Overall Performance

The Issuer will continue to operate virtually, outsourcing all non-core activities such as pre-clinical research and clinical trials and manufacturing.

Corporate Highlights

During the first six months of 2014 the Issuer accomplished the following:

On January 6, 2014, the Company extended the expiry date of 2,473,334 share purchase warrants exercisable to purchase one common share of the Company at an exercise price of $ $0.15 per share from the original expiry date of January 31, 2014 to July 31, 2014. The warrants were issued in connection with the Company’s ISA financing in 2011.

On January 6, 2014, the Company extended the expiry date 600,000 share purchase warrants exercisable to purchase one common share of the Company at an exercise price of $0.15 per share for the original expiry date of May 16, 2014 to November 16, 2014. The warrants were issued in connection with the Company’s ISA financing in 2011.

On January 6, 2014, the Company extended the expiry date 60,000 share purchase warrants exercisable to purchase one common share of the Company at an exercise price of $0.25 per share from the original expiry date of February 28, 2014 to August 28, 2014. The warrants were issued in connection with the private placement in February 28, 2011.

On January 10, 2014, the Company engaged Gale Capital Corp. for investor relation services. The term of the contract is for one year for fees of $10,000 lump sum up-front payment and $2,500 per month there after and may be terminated by either party after three months.

On January 10, 2014, the Company granted 400,000 stock options to advisors and consultants of the Company to purchase common shares of the Company for proceeds of $0.10 per common share expiring January 10, 2017.

On March 7, 2014 the Company issued 525,000 stock options to directors, officers, advisors and consultants of the Company to purchase common shares of the Company for proceeds of $0.10 per common share expiring March 7, 2019.

On March 12, 2014 the Company announced that the European Patent Office has issued an official letter stating that it intends to allow the application for the Company’s patent COMPOSITIONS AND METHODS FOR TREATING FIBROPROLIFERATIVE DISORDERS. This patent covers the composition and use of the combination of drugs used in the Company’s lead product for treatment of IPF and includes claims for the use of the combination to treat liver fibrosis, kidney fibrosis, uterine fibrosis and peripheral arterial disease.

On May 7, 2014 the Company announced that it had entered into an advisory agreement with TriPoint Global Equities LLC (“TriPoint”), a FINRA member firm. TriPoint is a global investment bank focused on assisting fast growing companies. The company issued to TriPoint warrants to purchase 700,000 shares at a price of $0.10 per share. The warrants expire on May 6, 2016

On June 14, 2014 the Company issued 500,000 options to purchase common shares to a director and officer under the 2013 stock option plan as approved at the Company’s previous annual general meeting. The options may be exercised at a price of $0.06 per share for a period of one (1) year.

Selected Financial Information

The financial information reported here has been prepared in accordance with IFRS. The Issuer uses the Canadian dollar (CDN) as its reporting currency. Selected un-audited financial data for interim operations of the Issuer for the three and six months ended June 30, 2014 and June 30, 2013 is presented below:

Selected Statement of Operations Data

Period ended	Three Months ended June 30, 2014			Three Months ended June 30, 2013			Six Months Ended June 30, 2014			Six Months Ended June 30, 2013
Total revenues	$	Nil		$	Nil		$	Nil		$	Nil
Net and Comprehensive loss	$	(149,592	)	$	(152,648	)		(323,817	)	$	(236,193	)
Basic loss per share	$	(0.00	)	$	(0.01	)	$	(0.01	)	$	(0.01	)
Diluted loss per share (Unaudited)	$	(0.00	)	$	(0.01	)	$	(0.01	)	$	(0.01	)
Weighted average shares		37,456,825			25,861,550			37,456,825			21,133,116

(1) Financial data for the quarter prepared using IFRS

The net loss and comprehensive loss from operations of $323,817 for the six months ended June 30, 2014 decreased when compared to the loss and comprehensive loss from operations of $327,183for the six months ended June 30, 2013. The decreased loss is primarily due to a decrease in advertising and promotion, derivative liability, write-off of a license and investor relations in the six month period ended June 30, 2014 as compared to the six month period ended June 30, 2013. These decreased expenses were offset by an increase in stock based compensation, insurance costs and professional fees in the six months ended June 30, 2014.

Selected Balance Sheet Data

Period ended	June 30, 2014			June 30, 2013
Cash & Equivalents	$	1,905		$	1,927
Current assets	$	18,048		$	21,903
Property and equipment (net of depreciation)	$	1,835		$	3,155
Patents & Licenses (net of amortization)	$	61,777		$	53,335
Total Assets	$	81,660		$	78,413
Current liabilities	$	747,813		$	645,840
Non-Current liabilities	$	Nil		$	Nil
Total liabilities	$	747,813			645,840
Working Capital	$	(729,765	)	$	(567,427	)

(1) Financial data prepared using IFRS

Cash and equivalents decreased in the first six months by $178,787 from $180,692 on December 31, 2013 to $1,905 as of June 30, 2014.

Comparison of the Quarters ending June 30, 2014, June 30, 2013 and June 30, 2012

Revenues

As the focus of management during the first six months of 2014 was on preparing for further clinical trials of PTL-202 and PTL-2015 no revenues were realized.

The Issuer has no drug therapies approved or for sale and has not generated any revenue from the sale of drug therapies. The Issuer has not recognized any revenue since inception through June 30, 2014. The Issuer does not expect to receive any revenues until after the completion of the Phase 2 trial of PTL-202 or the approval for marketing of PTL-2015.

The Issuer’s revenues will be earned through upfront payments from licenses, milestone payments included in-licenses and royalty income from licenses. The Issuer’s revenues will depend on out licensing the Issuer’s drug candidates to suitable development and commercialization partners and its partners’ abilities to successfully complete clinical trials and commercialize the Issuer’s drug candidates worldwide.

Expenses

The net loss and comprehensive loss from operations for the six months ended June 30, 2014 was $323,817 (June 30, 2013 - $327,183) a favorable variance of $3,366. The decreased loss is primarily due to a license write-off of $42,510 in the six month period ended June 30, 2013, decrease in investor relations of $35,000, loss on derivative liability of $13,255 and a decrease in advertising and promotion of $21,497. These decreases were offset by increases in stock based compensation in 2014 of $71,940 as the Company issued 925,000 options to directors, officers, advisors and consultants of the Company to purchase common shares of the Company for proceeds of $0.10 per common share, 400,000 options expire January 10, 2017 and 525,000 options expire march 2, 2019, decrease in professional fees and wages of $16,305 and increase travel costs of $3,835.

The net loss and comprehensive loss from operations for the three months ended March 31, 2013 was $174,535 (March 31, 2012 - $147,137) an unfavourable variance of $27,398. The increased loss is primarily due to an increase in license write-off of $42,510, advertising and promotion of $19,158, loss on the re-measurement of the component parts of the convertible note to fair value of $18,950, partially offset by a reduction in interest expense of $78,400.

Research & Development Expense

Research and development expense consists primarily of salaries for management of research contracts and research contracts for pre-clinical studies, clinical studies and assay development as well as the development of clinical trial protocols and application to government agencies to conduct clinical trials, including consulting services fees related to regulatory issues and business development expenses related to the identification and evaluation of new drug candidates. Research and development costs are expensed as they are incurred.

Three Months ended March 31 , 2014

Three Months ended March 31, 2013

Six Months Ended June 30, 2014

Six Months Ended June 30, 2013

Research and Development Expenses

Personnel, Consulting, and Stock-based Compensation

Nil

License Fees and Subcontract research

Nil

Facilities and Operations

Nil

Less: Government contributions

Nil

Total

Nil

For the six months ended June 30, 2014 research and development costs were $Nil (June 30, 2013 - $Nil) and for the six months ended June 30, 2012 research and development costs were $3,807. The decrease in research expense in 2014 and 2013 as compared to 2012 is due to a lack of funds to conduct clinical trials on PTL-202. The research and development costs for the six months ended June 30, 2012 were composed of $10,315 that was paid to IntelGenx under the development and commercialization agreement. This expense was offset by a $6,508 government grant..

During the next twelve months, subject to available funding the Issuer intends to test the bioavailability of a once a day formulation of PTL-2015, a treatment for erectile dysfunction. Also, during the next twelve months, subject to funding the Issuer intends to complete a dose escalating study of a once a day formulation of PTL-202 as well as develop data for chemistry, manufacturing and control for a regulatory submission.

Research and development expenses of approximately $250,000 are required for the pivotal trial scale-up and process development of PTL-202 and an additional $240,000 will be required for the pivotal clinical trial of the formulated product. The results of this work may provide the information required for a regulatory submission to move PTL-202 into a phase 2 study. The cost of the regulatory submission is budgeted at $280,000.

Additional financing will be required to complete the development and commercialize PTL-202. There is no assurance that such financing will be available or that the Issuer will have the capital to complete this proposed development and commercialization.

The Issuer was able to complete the formulation, drug/drug interaction study of PTL-202, analyzing the blood samples and analyzing the data from the drug/drug interaction trial in 2012 as planned. The Issuer’s clinical development studies and regulatory considerations relating to PTL-202 are subject to risks and uncertainties that may significantly impact its expense estimates and development schedules, including:

the scope, rate of progress and cost of the development of PTL-202;

uncertainties as to future results of the drug/drug interaction study of PTL-202;

uncertainties as to future results of the formulation development and pilot study of PTL-202;

the issuers ability to enroll subjects in clinical trials for current and future studies;

the Issuer’s ability to raise additional capital; and

the expense and timing of the receipt of regulatory approvals.

In addition to the formulation and clinical development plans for PTL-202 the Issuer may begin development of PTL-303 for the treatment of Liver Cirrhosis. The Issuer will only be able to begin development of PTL-303 if additional funds are available. There is no guarantee that these funds will be available to the Issuer and, if they are available, they may not be available on acceptable terms. Development of PTL-303 may significantly impact the Issuer’s expense projections and development timelines.

Also the Issuer has plans to initiate a bioequivelancy study of PTL-2015 for ED and make application to a regulatory for marketing approval. The budget for the development of PTL-2015 is $500,000.

General and Administrative Expenses

General and administrative costs consist primarily of personnel related costs, non-intellectual property related legal costs, accounting costs and other professional and administrative costs associated with general corporate activities.

During the six months ended June 30, 2014 total general and administrative costs were $324,043 (June 30, 2013 - $ 269,572) an increase of $54,471. The increased loss is primarily due to options issued during the quarter valued at $97,808 using the Black-Scholes Option Pricing Model, an increase professional fees and salaries of $36,004 and increased travel expenses of $ 6,908, partly offset by a decrease in advertising and promotion of $21,497and investor relations of $35,000.

During the three months ended June 30, 2013 total general and administrative costs were $ 149,592 (2013 - $157,397) a decrease of $7,805. The decreased loss is largely due to a decrease in advertising and promotion of $12,843, investor relations of $12,500.

During 2014 and beyond, as PTL-202 and PTL-2015 begin clinical development and as operations are developed to move PTL-202, PTL-2015 and other drug candidates through the clinical trial process, general and administrative expenses will increase. Increases in personnel costs, professional fees and expenses related to additional equipment will make up a significant portion of these planned expenditures.

Intellectual Property and Intangible Assets

All license and option fees paid to licensors for intellectual property licenses are accrued to intangible assets on the Issuer’s financial statements. In addition, any expenses for intellectual property protection including patent lawyers services fees and any filing fees with government agencies or the WIPO are accrued to intangible assets. There was a decrease in intangible assets in the first three months ended June 30, 2014 of $1,864 as compared to the year ended December 31, 2014, due to amortization for the period of $2,682 partly offset by patent license fee of $4,546.

Interest Expense/(Income)

The interest expense in the six months ended June 30, 2014 was $900 (June 30, 2013 –$ 1,800). The interest expense decrease was due to payment of the Interwest loan during the six months ended June 30, 2014.

Profits

At this time, the Issuer is not anticipating profit from operations. Until such time as the Issuer is able to realize profits from the out licensing of products under development, the Issuer will report an annual deficit and quarterly deficit and will rely on its ability to obtain equity/or debt financing to fund on-going operations. For information concerning the business of the Issuer, please see “Business Overview and Strategy”.

Stock Based Compensation

For the six months ended June 30, 2014 stock based compensation was $97,808 (June 30, 2013 - $34,847, June 30, 2012 - $11,564). The Company issued 925,000 options, to purchase a corresponding number of common shares at $0.10 for a period of 5 years, valued at $97,808 using the Black-Scholes option pricing model and 500,000 options, to purchase a corresponding number of common shares at $0.06 for a period of 1 year, valued at $25,868 using the Black-Scholes option pricing model.

Selected Quarterly Information

	June 30, 2014 $			March 31, 2014 $			December 31, 2013 $			September 31, 2013 $			June 30, 2013 $			March 31, 2013 $			December 31, 2012 $			September 31, 2012 $
Total Revenues		Nil			Nil			Nil			Nil			Nil			Nil			Nil			Nil
Net Loss		(149,592	)		(174,225	)		(308,767	)		(104,895	)		(152,648	)		(174,535	)		(205,919	)		(163,356	)
Loss per Share basic and diluted		(0.00	)		(0.00	)		(0.01	)		(0.00	)		(0.01	)		(0.01	)		(0.01	)		(0.01	)
Cash		1,905			10,220			180,692			7,523			1,927			7,220			9,854			36,004
Total Assets		81,660			122,296			287,043			136,900			78,413			121,075			206,533			280,629
Non-Current Liabilities		Nil			Nil			Nil			Nil			Nil			Nil			Nil			Nil

Liquidity and Capital Resources

At June 30, 2014, the Issuer had cash and cash equivalents of $ 1,905 (December 31, 2013 - $180,692) and a working capital deficit of $729,765 (December 31, 2013 – deficit $502,500). Working capital is defined as current assets less current liabilities.

The Issuer’s Cash flows from financing activities during the six months ended June 30, 2014 consisted of repayment of a promissory note and interest of $30,900. In the six months ended June 30, 2013 the Company received $110,000 from issuance of common shares and repaid a demand loan of $ 45,553with receipts from a promissory note and warrants generating $ 20,780. In the three months ended June 30, 2012 the Company received $118,401from issuance of common shares.

Cash utilized in operating activities during the six months ended June 30, 2014 was $ 143,341 (June 30, 2013 - $ 115,052, June 30, 2012 - $ 160,009). This difference between June 30, 2014 and June 30, 2013 was primarily due to a decrease in prepaid expenses of $58,559 and a decrease in license write offs of $42,510 and an increase in share based payments of $62,916.

At June 30, 2014, share capital was $2,699,210 comprising 37,456,825 issued and outstanding Common Shares (December 31, 2013 – $2,669,210 comprising 37,456,825 issued and outstanding Common Shares) as no shares were issued in the six months ended June 30, 2014.

Warrant and Option Reserves at June 30, 2014, is $221,512 (December 31, 2013 – $123,704) the increase is the result of the Company issuing 925,000, $0.10 options valued at $71,940 using the Black-Scholes option pricing model.

As a result of the net loss for the period ending June 30, 2014 of $323,817 (June 30, 2013 - $327,183, June 30, 2012 - $236,193), the deficit at June 30, 2014 increased to $3,586,875 from $3,263,058 as at December 31, 2013.

At present, the Issuer’s operations do not generate cash inflows and its financial success after June 30, 2014 is dependent on management’s ability to continue to obtain sufficient funding to sustain operations through the development stage and successfully bring the Issuer’s technologies to the point that they may be out licensed so that the Issuer achieves profitable operations. The research and development process can take many years and is subject to factors that are beyond the Issuer’s control.

In order to finance the Issuer’s future research and development and to cover administrative and overhead expenses in the coming years the Issuer may raise money through equity sales. Many factors influence the Issuer’s ability to raise funds, including the Issuer’s track record, and the experience and calibre of its management. Actual funding requirements may vary from those planned due to a number of factors, including the progress of research activities. Management believes it will be able to raise equity capital as required in the long term, but recognizes there will be risks involved that may be beyond their control. Should those risks fully materialize, it may not be able to raise adequate funds to continue its operations.

Off Balance Sheet Arrangements

There are currently no off balance sheet arrangements which could have an effect on current or future results or operations or the financial condition of the Company.

Transactions with Related Parties

Consulting and accounting fees were paid or accrued to Derick Sinclair the Company’s Chief Financial Officer and a shareholder of $10,500 during the six months ended June 30, 2014.

Legal fees of $446 were paid to a director of the Company.

Salary was paid or accrued to Doug Unwin the Company’s Chief Executive Officer and a shareholder of $ 40,000 during the 3 months ended June 30, 2014.

500,000 stock options that may be exercised for up to 5 years at an exercise price of $0.10 per share were grant to officers and directors of the Company. The options were assigned a fair value of $67,835 using the Black-Scholes Pricing Model and vest immediately.

Subsequent Events

On July 7, 2014 the Company announced that the European Patent Office has granted the Company’s patent COMPOSITIONS AND METHODS FOR TREATING FIBROPROLIFERATIVE DISORDERS. This patent covers the composition and use of the combination of drugs used in the Company’s lead product for treatment of IPF and includes claims for the use of the combination to treat liver fibrosis, kidney fibrosis, uterine fibrosis and peripheral arterial disease.

On July 9, 2014 the Company released the results of its pre-clinical studies of PTL-202. PTL-202 and its separate constituents were tested in 5 experiments in a recognized mouse model of pulmonary fibrosis. These studies provided the data required for the recently granted European patent covering the proprietary technology utilized in PTL-202.

On July 16, 2014 the company signed a term sheet with Vodis Innovative Pharmaceuticals (“Vodis”) agreeing to work with Vodis on the development of therapies based on extracts from cannabis plants.

On August 5, 204 the company announced a non-brokered Offering of the Company’s capital. The Company will offer up to 8,000,000 Units at a price of $0.05 per Unit for aggregate proceeds of CAD $400,000 (the “Offering”). Each Unit (a “Unit”) will consist of one common share and one warrant to purchase a common share. One warrant may be exercised to purchase a common share for $0.15 for up to one year. The Company may pay finders a fee consisting of cash and warrants from the proceeds of the proposed Offering. All of the Units issued will be subject to a four-month hold period. As well as accredited investors, the company will make the offer to subscribe for new capital available to existing shareholders, who can avail themselves of the offer under a new prospectus exemption process as set out in BC Instrument 45-534.

Proposed Transactions

As at the date of this Management Discussion and Analysis there are no transactions currently contemplated by the Issuer, other than the joint venture between the company and Vodis Innovative Pharmaceuticals for the development of cannaboid based therapies.

Financial Instruments and Other Instruments

The Issuer’s financial instruments consist of cash and cash equivalents, amounts receivable, accounts payable and accrued liabilities, amounts due to shareholders, irrevocable subscriptions and Class B Series I Preferred Shares. Unless otherwise noted, it is management’s opinion that the Issuer is not exposed to significant interest, currency or credit risks arising from financial instruments. Amounts due to shareholders, irrevocable subscriptions and Class B Series I Preferred Shares are classified as financial liabilities and are carried at amortized cost. The fair value of cash and cash equivalents, amounts receivable and accounts payable and accrued liabilities approximates their carrying value due to their short-term maturity or capacity for prompt liquidation.

Disclosure of Outstanding Share Data

As at June 30, 2014, the Issuer had an unlimited number of authorized common shares with 37,456,825 common shares issued and outstanding.

As at June 30, 2014 the issuer had 3,325,000 (December 31, 2013 - 1,900,000) options outstanding. During the three months ended June 30, 2014 the Company issued 500,000 options to purchase common shares for up to 5 years at an exercise price of $0.06 per common share to certain officers, directors, employees and consultants. The 3,325,000 options entitles the holder to purchase corresponding common shares at exercise prices ranging from $0.06 to $0.27 and expiry dates range from November 4, 2014 to June 11, 2020.

As at June 30, 2014 the Issuer had 18,219,836 warrants and 3,325,000 options outstanding. The following table shows the details for the outstanding warrants and options.

Description of Security (include conversion / exercise terms, including conversion / exercise price)	Number of convertible / exchangeable securities outstanding	Number of listed securities issuable upon conversion / exercise
2011 bonus warrants issued as an inducement for the Irrevocable Subscription Agreements, 1 whole warrant per unit exercisable at $0.15 up until July 31, 2014	2,333,334	2,333,334
2011 Unit warrants, 1 whole warrant per unit exercisable at $0.15 up until July 31, 2014	140,000	140,000
2011 Unit warrants, 1 whole warrant per unit exercisable at $0.15 up until August 28, 2014	60,000	60,000
2011 bonus warrants issued as an inducement for the Irrevocable Subscription Agreements, 1 whole warrant per unit exercisable at $0.15 up until November 16, 2014	600,000	600,000
2012 Unit Warrants, 1 whole warrant per unit exercisable at $0.22 up until June 20, 2014	732,670	732,670
2012 Finder Warrants, 1 whole warrant per unit exercisable at $0.22 up until June 19, 2014	56,666	56,666
2012 Unit Warrants 1 whole warrant per unit exercisable at $0.22 up until September 21, 2014	747,166	747,166
2013 Bonus Warrants 1 exercisable at $0.22 up until September 24, 2014	200,000	200,000
2013 Unit Warrants 1 whole warrant per unit exercisable at $0.22 up until February 12, 2015	1,000,000	1,000,000
2013 Unit Warrants 1 whole warrant per unit exercisable at $0.22 up until May 1, 2015	1,300,000	1,300,000
2013 Unit Warrants 1 whole warrant per unit exercisable at $0.10 up until October 8, 2016	2,250,000	2,250,000
2013 Unit Warrants 1 whole warrant per unit exercisable at $0.10 up until October 18, 2016	2,020,000	2,020,000
2013 Unit Warrants 1 whole warrant per unit exercisable at $0.10 up until November 5, 2016	6,780,000	6,780,000
Options expiring November 4, 2014 with an exercise price of $0.27	150,000	150,000
Options expiring March 5, 2015 with an exercise price of $0.27	375,000	375,000
Options expiring July 3, 2017, with an exercise price of $0.10	475,000	475,000
Options expiring December 21, 2017 with an exercise price of $0.10	450,000	450,000
Options expiring April 4, 2018 with an exercise price of $0.10	350,000	350,000
Options expiring September 16, 2018 with an exercise price of $0.10	100,000	100,000
Options expiring January 10, 2017 with an exercise price of $0.10	400,000	400,000
Options expiring March 2, 2019 with an exercise price of $0.10	525,000	525,000
Options expiring June 11, 2015 with an exercise price of $0.06	500,000	500,000

Subsequent events

On August 5, 2014 the Company announced a non-brokered Offering of the Company’s capital of up to 8,000,000 Units at a price of $0.05 per Unit for aggregate proceeds of CAD $400,000. Each Unit will consist of one common share and one warrant to purchase a common share. One warrant may be exercised to purchase a common share for $0.15 for up to one year. The Company may pay finders a fee consisting of cash and warrants from the proceeds of the proposed Offering. All of the Units issued will be subject to a four-month hold period.

EXHIBIT 99.3

Form 52-109FV2

Certification of Interim Filings

Venture Issuer Basic Certificate

I, Doug Unwin, Chief Executive Officer, for Pacific Therapeutics Ltd. certify the following:

1.	Review: I have reviewed the interim financial report and interim MD&A (together, the “interim filings”) of Pacific Therapeutics Ltd (the “issuer”) for the interim period ended June 30, 2014.

No misrepresentations: Based on my knowledge, having exercised reasonable diligence, the interim filings do not contain any untrue statement of a material fact or omit to state a material fact required to be stated or that is necessary to make a statement not misleading in light of the circumstances under which it was made, with respect to the period covered by the interim filings.

Fair presentation: Based on my knowledge, having exercised reasonable diligence, the interim financial report together with the other financial information included in the interim filings fairly present in all material respects the financial condition, financial performance and cash flows of the issuer, as of the date of and for the periods presented in the interim filings.

Date: August 27, 2014

“Doug Evans”

Doug Unwin

Chief Executive Officer

	NOTE TO READER

	In contrast to the certificate required for non-venture issuers under National Instrument 52-109 Certification of Disclosure in Issuers’ Annual and Interim Filings (NI 52-109), this Venture Issuer Basic Certificate does not include representations relating to the establishment and maintenance of disclosure controls and procedures (DC&P) and internal control over financial reporting (ICFR), as defined in NI 52-109. In particular, the certifying officers filing this certificate are not making any representations relating to the establishment and maintenance of

	i)	controls and other procedures designed to provide reasonable assurance that information required to be disclosed by the issuer in its annual filings, interim filings or other reports filed or submitted under securities legislation is recorded, processed, summarized and reported within the time periods specified in securities legislation; and

	ii)	a process to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with the issuer’s GAAP.

	The issuer’s certifying officers are responsible for ensuring that processes are in place to provide them with sufficient knowledge to support the representations they are making in this certificate. Investors should be aware that inherent limitations on the ability of certifying officers of a venture issuer to design and implement on a cost effective basis DC&P and ICFR as defined in NI 52-109 may result in additional risks to the quality, reliability, transparency and timeliness of interim and annual filings and other reports provided under securities legislation.

EXHIBIT 99.4

Form 52-109FV2

Certification of Interim Filings

Venture Issuer Basic Certificate

I, Derick Sinclair, Chief Financial Officer, for Pacific Therapeutics Ltd certify the following:

1.	Review: I have reviewed the interim financial report and interim MD&A (together, the “interim filings”) of Pacific Therapeutics Ltd. (the “issuer”) for the interim period ended June 30, 2014

Date: August 27, 2014

“Derick Sinclair”

Derick Sinclair

Chief Financial Officer

	NOTE TO READER

	In contrast to the certificate required for non-venture issuers under National Instrument 52-109 Certification of Disclosure in Issuers’ Annual and Interim Filings (NI 52-109), this Venture Issuer Basic Certificate does not include representations relating to the establishment and maintenance of disclosure controls and procedures (DC&P) and internal control over financial reporting (ICFR), as defined in NI 52-109. In particular, the certifying officers filing this certificate are not making any representations relating to the establishment and maintenance of

	i)	controls and other procedures designed to provide reasonable assurance that information required to be disclosed by the issuer in its annual filings, interim filings or other reports filed or submitted under securities legislation is recorded, processed, summarized and reported within the time periods specified in securities legislation; and

	ii)	a process to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with the issuer’s GAAP.

	The issuer’s certifying officers are responsible for ensuring that processes are in place to provide them with sufficient knowledge to support the representations they are making in this certificate. Investors should be aware that inherent limitations on the ability of certifying officers of a venture issuer to design and implement on a cost effective basis DC&P and ICFR as defined in NI 52-109 may result in additional risks to the quality, reliability, transparency and timeliness of interim and annual filings and other reports provided under securities legislation.