☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
2020
☐ | TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Symbol(s)
Yes ☒ No ☐
Large accelerated filer | ☐ | Accelerated Filer | ☒ | |||||||
Non-accelerated filer | ☐ | Smaller reporting company | ||||||||
Emerging growth company | ☐ |
June 30, 2019 | December 31, 2018 | |||||||
(unaudited) | ||||||||
ASSETS | ||||||||
Current Assets: | ||||||||
Cash and cash equivalents | $ | 23,417,512 | $ | 16,559,400 | ||||
Short-term investments | 36,503,442 | 36,922,213 | ||||||
Accounts receivable, net | 10,376,427 | — | ||||||
Inventory | 269,879 | 56,012 | ||||||
Prepaid expenses and other current assets | 1,488,603 | 1,649,781 | ||||||
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Total current assets | 72,055,863 | 55,187,406 | ||||||
Investments | 5,008,400 | 5,008,243 | ||||||
Operating leaseright-of-use asset | 1,013,590 | — | ||||||
Property and equipment, net | 147,619 | 245,425 | ||||||
Deposits | 8,888 | 8,888 | ||||||
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Total assets | $ | 78,234,360 | $ | 60,449,962 | ||||
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LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
Current Liabilities: | ||||||||
Accounts payable | $ | 3,328,726 | $ | 2,337,367 | ||||
Accrued expenses and other liabilities | 10,822,803 | 7,173,987 | ||||||
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Total current liabilities | 14,151,529 | 9,511,354 | ||||||
Accrued expenses and other liabilities,non-current | — | 154,799 | ||||||
Operating lease liability, net of current portion | 801,264 | — | ||||||
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Total liabilities | 14,952,793 | 9,666,153 | ||||||
Commitments and contingencies | ||||||||
Stockholders’ equity: | ||||||||
Preferred stock, $0.001 par value, 5,000,000 shares authorized: none issued and outstanding at June 30, 2019 and December 31, 2018 | — | — | ||||||
Common stock, $0.001 par value, 150,000,000 shares authorized; 102,929,257 shares and 102,739,257 shares issued and outstanding at June 30, 2019 and December 31, 2018, respectively | 102,929 | 102,739 | ||||||
Additionalpaid-in capital | 213,405,396 | 211,265,279 | ||||||
Accumulated deficit | (150,248,516 | ) | (160,563,961 | ) | ||||
Accumulated other comprehensive income (loss) | 21,758 | (20,248 | ) | |||||
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Total stockholders’ equity | 63,281,567 | 50,783,809 | ||||||
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Total liabilities and stockholders’ equity | $ | 78,234,360 | $ | 60,449,962 | ||||
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June 30, 2020 | December 31, 2019 | |||||||
(unaudited) | ||||||||
ASSETS | ||||||||
Current Assets: | ||||||||
Cash and cash equivalents | $ | 115,052,248 | $ | 89,511,710 | ||||
Short-term investments | — | 5,007,050 | ||||||
Accounts receivable, net | 6,762,262 | 10,536,997 | ||||||
Inventory | 1,827,924 | 1,956,792 | ||||||
Prepaid expenses and other current assets | 7,521,253 | 4,351,074 | ||||||
Total current assets | 131,163,687 | 111,363,623 | ||||||
Operating lease right-of-use | 71,711 | 793,252 | ||||||
Property and equipment, net | 167,514 | 210,467 | ||||||
Deposits | 8,888 | 8,888 | ||||||
Total assets | $ | 131,411,800 | $ | 112,376,230 | ||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
Current Liabilities: | ||||||||
Accounts payable | $ | 5,804,778 | $ | 4,117,447 | ||||
Accrued expenses and other liabilities | 14,405,597 | 19,981,295 | ||||||
Total current liabilities | 20,210,375 | 24,098,742 | ||||||
Operating lease liability, net of current portion | — | 647,532 | ||||||
Total liabilities | 20,210,375 | 24,746,274 | ||||||
Commitments and contingencies | ||||||||
Stockholders’ equity: | ||||||||
Preferred stock, $0.001 par value, 5,000,000 shares authorized: NaN issued and outstanding at June 30, 2020 and December 31, 2019 | — | — | ||||||
Common stock, $0.001 par value, 150,000,000 shares authorized; 103,422,032 shares and 103,397,033 shares issued and outstanding at June 30, 2020 and December 31, 2019, respectively | 103,422 | 103,397 | ||||||
Additional paid-in capital | 219,581,816 | 216,205,678 | ||||||
Accumulated deficit | (108,482,622 | ) | (128,688,624 | ) | ||||
Accumulated other comprehensive income (loss) | (1,191 | ) | 9,505 | |||||
Total stockholders’ equity | 111,201,425 | 87,629,956 | ||||||
Total liabilities and stockholders’ equity | $ | 131,411,800 | $ | 112,376,230 | ||||
For the Three Months Ended June 30, | For the Six Months Ended June 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Product revenue, net | $ | 28,837,900 | $ | — | $ | 41,286,338 | $ | — | ||||||||
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Operating costs and expenses: | ||||||||||||||||
Cost of sales | 4,261,625 | — | 5,973,413 | — | ||||||||||||
Research and development | 4,629,364 | 3,704,824 | 7,937,323 | 6,963,866 | ||||||||||||
Selling, general and administrative | 8,987,722 | 2,631,031 | 17,404,182 | 5,305,429 | ||||||||||||
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Total operating costs and expenses | 17,878,711 | 6,335,855 | 31,314,918 | 12,269,295 | ||||||||||||
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Operating income (loss) | 10,959,189 | (6,335,855 | ) | 9,971,420 | (12,269,295 | ) | ||||||||||
Other income, net | 450,410 | 370,715 | 793,676 | 604,263 | ||||||||||||
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Net income (loss) before income taxes | 11,409,599 | (5,965,140 | ) | 10,765,096 | (11,665,032 | ) | ||||||||||
Provision for income taxes | 449,651 | — | 449,651 | — | ||||||||||||
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Net income (loss) | $ | 10,959,948 | $ | (5,965,140 | ) | $ | 10,315,445 | $ | (11,665,032 | ) | ||||||
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Net income (loss) per share: | ||||||||||||||||
Basic | $ | 0.11 | $ | (0.06 | ) | $ | 0.10 | $ | (0.11 | ) | ||||||
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Diluted | $ | 0.10 | $ | (0.06 | ) | $ | 0.10 | $ | (0.11 | ) | ||||||
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Weighted average shares outstanding: | ||||||||||||||||
Basic | 102,869,202 | 102,596,446 | 102,808,897 | 102,577,005 | ||||||||||||
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Diluted | 105,928,970 | 102,596,446 | 105,098,930 | 102,577,005 | ||||||||||||
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Net income (loss) | $ | 10,959,948 | $ | (5,965,140 | ) | $ | 10,315,445 | $ | (11,665,032 | ) | ||||||
Other comprehensive income (loss): | ||||||||||||||||
Unrealized gain (loss) onavailable-for-sale securities | 28,446 | (14,672 | ) | 42,006 | (36,498 | ) | ||||||||||
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Comprehensive income (loss) | $ | 10,988,394 | $ | (5,979,812 | ) | $ | 10,357,451 | $ | (11,701,530 | ) | ||||||
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For the Three Months Ended June 30, | For the Six Months Ended June 30, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
Product revenue, net | $ | 29,604,764 | $ | 28,837,900 | $ | 58,741,236 | $ | 41,286,338 | ||||||||
Operating costs and expenses: | ||||||||||||||||
Cost of sales | 4,139,873 | 4,261,625 | 8,290,739 | 5,973,413 | ||||||||||||
Research and development | 4,349,643 | 4,629,364 | 8,572,454 | 7,937,323 | ||||||||||||
Selling, general and administrative | 10,833,358 | 8,987,722 | 20,896,406 | 17,404,182 | ||||||||||||
Total operating costs and expenses | 19,322,874 | 17,878,711 | 37,759,599 | 31,314,918 | ||||||||||||
Operating income (loss) | 10,281,890 | 10,959,189 | 20,981,637 | 9,971,420 | ||||||||||||
Other income, net | 111,269 | 450,410 | 447,502 | 793,676 | ||||||||||||
Net income (loss) before income taxes | 10,393,159 | 11,409,599 | 21,429,139 | 10,765,096 | ||||||||||||
Provision for income taxes | 613,172 | 449,651 | 1,223,137 | 449,651 | ||||||||||||
Net income (loss) | $ | 9,779,987 | $ | 10,959,948 | $ | 20,206,002 | $ | 10,315,445 | ||||||||
Net income (loss) per share: | ||||||||||||||||
Basic | $ | 0.09 | $ | 0.11 | $ | 0.20 | $ | 0.10 | ||||||||
Diluted | $ | 0.09 | $ | 0.10 | $ | 0.19 | $ | 0.10 | ||||||||
Weighted average shares outstanding: | ||||||||||||||||
Basic | 103,414,523 | 102,869,202 | 103,410,881 | 102,808,897 | ||||||||||||
Diluted | 106,730,423 | 105,928,970 | 106,433,862 | 105,098,930 | ||||||||||||
Net income (loss) | $ | 9,779,987 | $ | 10,959,948 | $ | 20,206,002 | $ | 10,315,445 | ||||||||
Other comprehensive income (loss): | ||||||||||||||||
Unrealized gain (loss) on available-for-sale | (84,942 | ) | 28,446 | (10,696 | ) | 42,006 | ||||||||||
Comprehensive income (loss) | $ | 9,695,045 | $ | 10,988,394 | $ | 20,195,306 | $ | 10,357,451 | ||||||||
Preferred Stock | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Accumulated Other Comprehensive Gain (Loss) | Total | |||||||||||||||||||
Balance at December 31, 2018 | $ | — | $ | 102,739 | $ | 211,265,279 | $ | (160,563,961 | ) | $ | (20,248 | ) | $ | 50,783,809 | ||||||||||
Issuance of stock options for services | — | — | 933,411 | — | — | 933,411 | ||||||||||||||||||
Exercise of stock options for common stock | — | 65 | 89,285 | — | — | 89,350 | ||||||||||||||||||
Other comprehensive gain (loss) | — | — | — | — | 13,560 | 13,560 | ||||||||||||||||||
Net income (loss) | — | — | — | (644,503 | ) | — | (644,503 | ) | ||||||||||||||||
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Balance at March 31, 2019 | — | 102,804 | $ | 212,287,975 | (161,208,464 | ) | (6,688 | ) | 51,175,627 | |||||||||||||||
Issuance of stock options for services | — | — | 924,996 | — | — | 924,996 | ||||||||||||||||||
Exercise of stock options for common stock | — | 125 | 192,425 | — | — | 192,550 | ||||||||||||||||||
Other comprehensive gain (loss) | — | — | — | — | 28,446 | 28,446 | ||||||||||||||||||
Net income (loss) | — | — | — | 10,959,948 | — | 10,959,948 | ||||||||||||||||||
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Balance at June 30, 2019 | $ | — | $ | 102,929 | $ | 213,405,396 | $ | (150,248,516 | ) | $ | 21,758 | $ | 63,281,567 | |||||||||||
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Preferred Stock | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Accumulated Other Comprehensive Gain (Loss) | Total | |||||||||||||||||||
Balance at December 31, 2017 | $ | — | $ | 102,549 | $ | 207,421,710 | $ | (126,560,447 | ) | $ | — | $ | 80,963,812 | |||||||||||
Issuance of stock options for services | — | — | 971,340 | — | — | 971,340 | ||||||||||||||||||
Exercise of stock options for common stock | — | 37 | 32,995 | — | — | 33,032 | ||||||||||||||||||
Other comprehensive gain (loss) | — | — | — | — | (21,826 | ) | (21,826 | ) | ||||||||||||||||
Net income (loss) | — | — | — | (5,699,892 | ) | — | (5,699,892 | ) | ||||||||||||||||
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Balance at March 31, 2018 | — | 102,586 | $ | 208,426,045 | (132,260,339 | ) | (21,826 | ) | 76,246,466 | |||||||||||||||
Issuance of common stock, net | — | 3 | 10,546 | — | — | 10,549 | ||||||||||||||||||
Issuance of stock options for services | — | — | 776,510 | — | — | 776,510 | ||||||||||||||||||
Exercise of stock options for common stock | — | 10 | 8,490 | — | — | 8,500 | ||||||||||||||||||
Other comprehensive gain (loss) | — | — | — | — | (14,672 | ) | (14,672 | ) | ||||||||||||||||
Net income (loss) | — | — | — | (5,965,140 | ) | — | (5,965,140 | ) | ||||||||||||||||
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Balance at June 30, 2018 | $ | — | $ | 102,599 | $ | 209,221,591 | $ | (138,225,479 | ) | $ | (36,498 | ) | $ | 71,062,213 | ||||||||||
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2019
Preferred | Common Stock | Additional Paid-in | Accumulated | Accumulated Other Comprehensive | ||||||||||||||||||||||||
Stock | Shares | Amount | Capital | Deficit | Gain (Loss) | Total | ||||||||||||||||||||||
Balance at December 31, 2019 | $ | — | 103,397,033 | $ | 103,397 | $ | 216,205,678 | $ | (128,688,624 | ) | $ | 9,505 | $ | 87,629,956 | ||||||||||||||
Issuance of stock options for services | — | — | — | 1,383,672 | — | — | 1,383,672 | |||||||||||||||||||||
Exercise of stock options for common stock | — | 11,666 | 12 | 26,137 | — | — | 26,149 | |||||||||||||||||||||
Amortization of restricted stock for services | — | — | — | 135,679 | — | — | 135,679 | |||||||||||||||||||||
Other comprehensive gain (loss) | — | — | — | — | — | 74,246 | 74,246 | |||||||||||||||||||||
Net income (loss) | — | — | — | — | 10,426,015 | — | 10,426,015 | |||||||||||||||||||||
Balance at March 31, 2020 | — | 103,408,699 | 103,409 | 217,751,166 | (118,262,609 | ) | 83,751 | 99,675,717 | ||||||||||||||||||||
Issuance of stock options for services | — | — | — | 1,627,105 | — | — | 1,627,105 | |||||||||||||||||||||
Exercise of stock options for common stock | — | 13,333 | 13 | 36,188 | — | — | 36,201 | |||||||||||||||||||||
Amortization of restricted stock for services | — | — | — | 167,357 | — | — | 167,357 | |||||||||||||||||||||
Other comprehensive gain (loss) | — | — | — | — | — | (84,942 | ) | (84,942 | ) | |||||||||||||||||||
Net income (loss) | — | — | — | — | 9,779,987 | — | 9,779,987 | |||||||||||||||||||||
Balance at June 30, 2020 | $ | — | 103,422,032 | $ | 103,422 | $ | 219,581,816 | $ | (108,482,622 | ) | $ | (1,191 | ) | $ | 111,201,425 | |||||||||||||
Preferred | Common Stock | Additional Paid-in | Accumulated | Accumulated Other Comprehensive | ||||||||||||||||||||||||
Stock | Shares | Amount | Capital | Deficit | Gain (Loss) | Total | ||||||||||||||||||||||
Balance at December 31, 2018 | $ | — | 102,739,257 | $ | 102,739 | $ | 211,265,279 | $ | (160,563,961 | ) | $ | (20,248 | ) | $ | 50,783,809 | |||||||||||||
Issuance of stock options for services | — | — | — | 933,411 | — | — | 933,411 | |||||||||||||||||||||
Exercise of stock options for common stock | — | 65,000 | 65 | 89,285 | — | — | 89,350 | |||||||||||||||||||||
Other comprehensive gain (loss) | — | — | — | — | — | 13,560 | 13,560 | |||||||||||||||||||||
Net income (loss) | — | — | — | — | (644,503 | ) | — | (644,503 | ) | |||||||||||||||||||
Balance at March 31, 2019 | — | 102,804,257 | 102,804 | 212,287,975 | (161,208,464 | ) | (6,688 | ) | 51,175,627 | |||||||||||||||||||
Issuance of stock options for services | — | — | — | 924,996 | — | — | 924,996 | |||||||||||||||||||||
Exercise of stock options for common stock | — | 125,000 | 125 | 192,425 | — | — | 192,550 | |||||||||||||||||||||
Other comprehensive gain (loss) | — | — | — | — | — | 28,446 | 28,446 | |||||||||||||||||||||
Net income (loss) | — | — | — | — | 10,959,948 | — | 10,959,948 | |||||||||||||||||||||
Balance at June 30, 2019 | $ | — | 102,929,257 | $ | 102,929 | $ | 213,405,396 | $ | (150,248,516 | ) | $ | 21,758 | $ | 63,281,567 | ||||||||||||||
For the Six Months Ended June 30, | ||||||||
2019 | 2018 | |||||||
Operating Activities: | ||||||||
Net income (loss) | $ | 10,315,445 | $ | (11,665,032 | ) | |||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||||||||
Depreciation | 20,186 | 16,191 | ||||||
Non-cash change inright-of-use asset | 120,051 | — | ||||||
Stock-based compensation | 1,858,407 | 1,762,847 | ||||||
Change in accrued interest and accretion of discount on investments | (77,547 | ) | (255,210 | ) | ||||
(Increase) decrease in: | ||||||||
Accounts receivable, net | (10,376,427 | ) | — | |||||
Inventory | (213,867 | ) | — | |||||
Prepaid expenses and other current assets and deposits | 161,178 | 496,403 | ||||||
Increase (decrease) in: | ||||||||
Accounts payable | 991,359 | (1,022,982 | ) | |||||
Accrued expenses and other liabilities | 3,393,753 | (175,273 | ) | |||||
Operating lease liability | (135,123 | ) | — | |||||
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Net cash provided by (used in) operating activities | 6,057,415 | (10,843,056 | ) | |||||
Investing Activities: | ||||||||
Purchases of property and equipment | (19,370 | ) | (11,937 | ) | ||||
Purchases of investments | (29,772,428 | ) | (36,790,854 | ) | ||||
Proceeds from sales/maturities of investments | 30,310,595 | — | ||||||
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Net cash provided by (used in) investing activities | 518,797 | (36,802,791 | ) | |||||
Financing Activities: | ||||||||
Payment of employee withholding tax related to stock-based compensation | — | (4,448 | ) | |||||
Proceeds from exercise of stock options | 281,900 | 41,532 | ||||||
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Net cash provided by (used in) financing activities | 281,900 | 37,084 | ||||||
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Net increase (decrease) in cash and cash equivalents | 6,858,112 | (47,608,763 | ) | |||||
Cash and cash equivalents - beginning of period | 16,559,400 | 57,496,702 | ||||||
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Cash and cash equivalents - end of period | $ | 23,417,512 | $ | 9,887,939 | ||||
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Non-cash investing and financing activities: | ||||||||
Unrealized gain (loss) onavailable-for-sale securities | $ | 42,006 | $ | (36,498 | ) |
For the Six Months Ended June 30, | ||||||||
2020 | 2019 | |||||||
Operating Activities: | ||||||||
Net income (loss) | $ | 20,206,002 | $ | 10,315,445 | ||||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||||||||
Depreciation | 42,953 | 20,186 | ||||||
Amortization of right-of-use | 721,541 | 120,051 | ||||||
Stock-based compensation | 3,313,813 | 1,858,407 | ||||||
Change in accrued interest and accretion of discount on investments | (3,646 | ) | (77,547 | ) | ||||
(Increase) decrease in: | ||||||||
Accounts receivable, net | 3,774,735 | (10,376,427 | ) | |||||
Inventory | 128,868 | (213,867 | ) | |||||
Prepaid expenses and other current assets and deposits | (3,170,179 | ) | 161,178 | |||||
Increase (decrease) in: | ||||||||
Accounts payable | 1,687,331 | 991,359 | ||||||
Accrued expenses and other liabilities | (5,473,075 | ) | 3,393,753 | |||||
Operating lease liability | (750,155 | ) | (135,123 | ) | ||||
Net cash provided by (used in) operating activities | 20,478,188 | 6,057,415 | ||||||
Investing Activities: | ||||||||
Purchases of property and equipment | — | (19,370 | ) | |||||
Purchases of investments | — | (29,772,428 | ) | |||||
Proceeds from maturities and sales of investments | 5,000,000 | 30,310,595 | ||||||
Net cash provided by (used in) investing activities | 5,000,000 | 518,797 | ||||||
Financing Activities: | ||||||||
Proceeds from exercise of stock options | 62,350 | 281,900 | ||||||
Net cash provided by (used in) financing activities | 62,350 | 281,900 | ||||||
Net increase (decrease) in cash and cash equivalents | 25,540,538 | 6,858,112 | ||||||
Cash and cash equivalents—beginning of period | 89,511,710 | 16,559,400 | ||||||
Cash and cash equivalents—end of period | $ | 115,052,248 | $ | 23,417,512 | ||||
Supplemental disclosures of cash flow information: | ||||||||
Cash paid for income taxes | $ | 49,500 | $ | — | ||||
Non-cash investing and financing activities: | ||||||||
Unrealized gain (loss) on available-for-sale | $ | (10,696 | ) | $ | 42,006 |
1. | Organization and Description of Business. |
11 (Stockholders’ Equity).
2. | Basis of Presentation and Significant Accounting Policies. |
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2. | Basis of Presentation and Significant Accounting Policies (continued). |
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isthat was classified inas trading securities. Trading securities are recorded at fair value based on the closing market price of the security. For trading securities, the Company recognizes realized gains and losses and unrealized gains and losses to earnings. At June 30, 20192020 and December 31, 2018, the only investment2019, there were 0 investments classified as trading securities, wasas the Company sold its interest in the short-term bond fund. Realized losses on trading securities were $0 and $4,980, respectively, for the three and six months ended June 30,fund in 2019. There were no sales ofwas 0 realized or unrealized gain (loss) on trading securities for the three and six months ended June 30, 2018.2020. Realized losses on trading securities during the three and six months ended June 30, 2019 were $0 and $4,980, respectively. Unrealized gain (loss) on trading securities was $36,664 and $89,405 respectively, for the three and six months ended June 30, 2019 and $29,431 and ($29,430) for the three and six months ended June 30, 2018 and is included in other income, net in the accompanying consolidated statements of operations.from the date of purchase as short-term investments.the accompanyingits consolidated balance sheets. The Company recordsoperations.operations and comprehensive income (loss). The Company recognizes a charge when the declines in the fair value below the amortized cost basis of its3.3 (Investments).
2. | Basis of Presentation and Significant Accounting Policies (continued). |
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2. | Basis of Presentation and Significant Accounting Policies (continued). |
Fair Value Measurements at Reporting Date Using | ||||||||||||||||
Balances as of June 30, 2019 | Quoted Prices in Active Markets for Identical Assets/Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | |||||||||||||
Cash and cash equivalents: | ||||||||||||||||
Money market funds | $ | 22,764,183 | $ | 22,764,183 | $ | — | $ | — | ||||||||
|
|
|
|
|
|
|
| |||||||||
Short-term investments: | ||||||||||||||||
Short-term bond fund | $ | 16,607,242 | $ | 16,607,242 | $ | — | $ | — | ||||||||
|
|
|
|
|
|
|
| |||||||||
U.S. Treasuries | $ | 19,896,200 | $ | — | $ | 19,896,200 | $ | — | ||||||||
|
|
|
|
|
|
|
| |||||||||
Investments: | ||||||||||||||||
U.S. Treasuries | $ | 5,008,400 | $ | — | $ | 5,008,400 | $ | — | ||||||||
|
|
|
|
|
|
|
| |||||||||
Balances as of December 31, 2018 | Quoted Prices in Active Markets for Identical Assets/Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | |||||||||||||
Cash and cash equivalents: | ||||||||||||||||
Money market funds | $ | 14,462,087 | $ | 14,462,087 | $ | — | $ | — | ||||||||
|
|
|
|
|
|
|
| |||||||||
Short-term investments: | ||||||||||||||||
Short-term bond fund | $ | 26,541,349 | $ | 26,541,349 | $ | — | $ | — | ||||||||
|
|
|
|
|
|
|
| |||||||||
U.S. Treasuries | $ | 10,380,864 | $ | — | $ | 10,380,864 | $ | — | ||||||||
|
|
|
|
|
|
|
| |||||||||
Investments: | ||||||||||||||||
U.S. Treasuries | $ | 5,008,243 | $ | — | $ | 5,008,243 | $ | — | ||||||||
|
|
|
|
|
|
|
|
|
Fair Value Measurements at Reporting Date Using | ||||||||||||||||
Balances as of June 30, 2020 | Quoted Prices in Active Markets for Identical Assets/Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | |||||||||||||
Cash and cash equivalents: | ||||||||||||||||
Money market funds | $ | 19,628,370 | $ | 19,628,370 | $ | — | $ | — | ||||||||
U.S. Treasuries | $ | 84,990,900 | $ | — | $ | 84,990,900 | $ | — | ||||||||
Balances as of December 31, 2019 | Quoted Prices in Active Markets for Identical Assets/Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | |||||||||||||
Cash and cash equivalents: | ||||||||||||||||
Money market funds | $ | 23,963,617 | $ | 23,963,617 | $ | — | $ | — | ||||||||
U.S. Treasuries | $ | 59,932,200 | $ | — | $ | 59,932,200 | $ | — | ||||||||
Short-term investments: | ||||||||||||||||
U.S. Treasuries | $ | 5,007,050 | $ | — | $ | 5,007,050 | $ | — | ||||||||
k. |
|
Operating lease ROU assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. As the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The operating lease ROU asset also includes any lease payments made and excludes lease incentives and initial direct costs incurred. The Company’s lease terms do not include options to extend or terminate the lease as it is not reasonably certain that it will exercise these options. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. The Company has lease agreements with lease andnon-lease components, which are generally accounted for separately. Refer to Note 2.r. for discussion on adoption method.
l. |
|
2. | Basis of Presentation and Significant Accounting Policies (continued). |
|
athe Customer (its exclusive distributor) who subsequently resells Firdapse
As of June 30,2020 and 2019, all of the Company’s sales arewere to its Customer.
2. | Basis of Presentation and Significant Accounting Policies (continued). |
|
receivables,receivable, net on the consolidated balance sheets.
2. | Basis of Presentation and Significant Accounting Policies (continued). |
operations and comprehensive income (loss). from sales of the collaborative product.payerpayor despite having health insurance.insurance, to the extent allowed by applicable law. The Company does not recognize any revenue related to these free products and the associated costs are classified in selling, general and administrative expenses in the Company’s consolidated statements of operations.collaboratorscollaborator could be required to make various payments to the Company, including upfront license fees, milestone payments based on achievement of regulatory approvals, and royalties on sales of products resulting from the collaborative agreement.and June 30, 2018,there was no royalty revenue was recognized.8, Collaborative Arrangement,7 (Collaborative Arrangement), for further discussion on the Company’s collaborative arrangement. CONCENTRATION OF RISK.The Company sells its product in the United States through an exclusive distributor to specialty pharmacies. Therefore, its distributor and specialty pharmacies account for all of its trade receivables and net product revenues. The creditworthiness of its Customer is continuously monitored, and the Company has internal policies regarding customer credit limits. The Company estimates an allowance for doubtful accounts primarily based on the credit worthiness of its Customer, historical payment patterns, aging of receivable balances and general economic conditions.
The Company currently has a single product with limited commercial sales experience, which makes it difficult to evaluate its current business, predict its future prospects and forecast financial performance and growth. The Company has invested a significant portion of its efforts and financial resources in the development and commercialization of the lead product, Firdapse®, and expects Firdapse® to constitute virtually all of product revenue for the foreseeable future. The Company’s success depends on its ability to effectively commercialize Firdapse®.
The Company relies exclusively on third parties to formulate and manufacture Firdapse® and its drug candidates. The commercialization of Firdapse® and any other drug candidates, if approved, could be stopped, delayed or made less profitable if those third parties fail to provide sufficient quantities of product or fail to do so at acceptable quality levels or prices. The Company does not intend to establish its own manufacturing facilities. The Company is using the same third-party contractors to manufacture, supply, store and distribute drug supplies for clinical trials and the commercialization of Firdapse®. If the Company is unable to continue its relationships with one or more of these third-party contractors, it could experience delays in the development or commercialization efforts as it locates and qualifies new manufacturers. The Company intends to rely on one or more third-party contractors to manufacture the commercial supply of drugs.
|
RESEARCH AND DEVELOPMENT. |
n. |
|
2. | Basis of Presentation and Significant Accounting Policies ( continued ). |
o. |
|
p. | ROYALTIES. |
q. | INCOME TAXES. |
2. | Basis of Presentation and Significant Accounting Policies (continued). |
r. | COMPREHENSIVE INCOME (LOSS). available-for-sale |
s. |
|
For the Three Months Ended June 30, | For the Six Months Ended June 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Basic weighted average common shares outstanding | 102,869,202 | 102,596,446 | 102,808,897 | 102,577,005 | ||||||||||||
Effect of dilutive securities: | ||||||||||||||||
Common stock issuable upon the exercise of stock options | 3,059,768 | — | 2,290,033 | — | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Diluted weighted average common shares outstanding | 105,928,970 | 102,596,446 | 105,098,930 | 102,577,005 | ||||||||||||
|
|
|
|
|
|
|
|
For the Three Months Ended June 30, | For the Six Months Ended June 30, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
Basic weighted average common shares outstanding | 103,414,523 | 102,869,202 | 103,410,881 | 102,808,897 | ||||||||||||
Effect of dilutive securities | 3,315,900 | 3,059,768 | 3,022,981 | 2,290,033 | ||||||||||||
Dilutive weighted average common shares outstanding | 106,730,423 | 105,928,970 | 106,433,862 | 105,098,930 | ||||||||||||
t. | RECLASSIFICATIONS. |
u. | RECENTLY ISSUED ACCOUNTING STANDARDS. 2018-18, Collaborative Arrangements (Topic 808), which amends ASC 808 to clarify when transactions between participants in a collaborative arrangement under ASC 808 are within the scope of the FASB’s new revenue standard, ASU2014-09 (codified in ASC 606). The amendments require the application of ASC 606 existing guidance to determine the units of account that are distinct in a collaborative arrangement for purposes of identifying transactions with customers. If a unit of account within the collaborative arrangement is distinct and is with a customer, an entity shall apply the guidance in Topic 606 to that unit of account. In a transaction between collaborative participants, an entity is precluded by ASU2018-18 from presenting a transaction together with “revenue from contracts with customers” unless the unit of account is within the scope of ASC 606 and the entity applies the guidance in ASC 606 to such unit of account. The Company adopted the new standard on January 1, 2020. The Company has a collaboration agreement with Endo Ventures Limited (Endo). See Note 7 (Collaborative Arrangement). However, these amendments did not have an impact on the Company’s consolidated financial statements, as Endo does not meet the definition of a customer. |
2. | Basis of Presentation and Significant Accounting Policies (continued). |
|
In June 2018, the FASB issued ASUNo. 2018-07,Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting that largely aligns the accounting for share-based payment awards issued to employees and nonemployees. Under this ASU, most of the guidance on such payments to nonemployees would be aligned with the requirements for share-based payments granted to employees. ASU2018-07 is effective for all entities for annual reporting periods beginning after December 15, 2018, including interim reporting periods within each annual reporting period, with early adoption permitted. The Company has adopted this standard as of January 1, 2019. The adoption of this standard did not have a material impact on the Company’s consolidated financial statements.
3. |
Investments. |
|
Available-for-sale
Estimated Fair Value | Gross Unrealized Gains | Gross Unrealized Losses | Amortized Cost | |||||||||||||
At June 30, 2019: | ||||||||||||||||
U.S. Treasuries - ST | $ | 19,896,200 | $ | 12,102 | $ | — | $ | 19,884,098 | ||||||||
U.S. Treasuries - LT | 5,008,400 | 9,656 | — | 4,998,744 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total | $ | 24,904,600 | $ | 21,758 | $ | — | $ | 24,882,842 | ||||||||
|
|
|
|
|
|
|
| |||||||||
At December 31, 2018: | ||||||||||||||||
U.S. Treasuries - ST | $ | 10,380,864 | $ | — | $ | (1,835 | ) | $ | 10,382,699 | |||||||
U.S. Treasuries - LT | 5,008,243 | — | (18,413 | ) | 5,026,656 | |||||||||||
|
|
|
|
|
|
|
| |||||||||
Total | $ | 15,389,107 | $ | — | $ | (20,248 | ) | $ | 15,409,355 | |||||||
|
|
|
|
|
|
|
|
Estimated Fair Value | Gross Unrealized Gains | Gross Unrealized Losses | Amortized Cost | |||||||||||||
At June 30, 2020: | ||||||||||||||||
U.S. Treasuries – Cash equivalents | $ | 84,990,900 | $ | — | $ | (1,191 | ) | $ | 84,992,091 | |||||||
At December 31, 2019: | ||||||||||||||||
U.S. Treasuries – Cash equivalents | $ | 59,932,200 | $ | 2,042 | $ | — | $ | 59,930,158 | ||||||||
U.S. Treasuries – ST | 5,007,050 | 7,463 | — | 4,999,587 | ||||||||||||
Total | $ | 64,939,250 | $ | 9,505 | $ | — | $ | 64,929,745 | ||||||||
2019. The Company did not hold any securities in an unrealized loss position for more than 12 months as of June 30, 2019.
2020.
June 30, 2019 | ||||
Due in one year or less | $ | 24,904,600 | ||
Due after one year | — | |||
|
| |||
$ | 24,904,600 | |||
|
|
June 30, 2020 | ||||
Due in one year or less | $ | 84,990,900 | ||
4. | Prepaid Expenses and Other Current Assets. |
June 30, 2019 | December 31, 2018 | |||||||
Prepaid research fees | $ | 371,743 | $ | 358,209 | ||||
Prepaid insurance | 399,939 | 800,261 | ||||||
Prepaid commercialization fees | 149,785 | 17,030 | ||||||
Prepaid subscription fees | 184,851 | 170,552 | ||||||
Other | 382,285 | 303,729 | ||||||
|
|
|
| |||||
Total prepaid expenses and other current assets | $ | 1,488,603 | $ | 1,649,781 | ||||
|
|
|
|
June 30, 2020 | December 31, 2019 | |||||||
Prepaid manufacturing costs | $ | 5,499,746 | $ | 1,526,013 | ||||
Prepaid insurance | 622,350 | 1,263,129 | ||||||
Prepaid subscription fees | 429,155 | 501,251 | ||||||
Prepaid research fees | 458,937 | 481,057 | ||||||
Prepaid commercialization expenses | 218,651 | 62,959 | ||||||
Other | 292,414 | 516,665 | ||||||
Total prepaid expenses and other current assets | $ | 7,521,253 | $ | 4,351,074 | ||||
5. | Operating Leases. |
For the Three Months Ended June 30, 2019 | For the Six Months Ended June 30, 2019 | |||||||
Operating lease cost | $ | 74,079 | $ | 148,158 |
For the Three Months Ended June 30, 2020 | For the Six Months Ended June 30, 2020 | |||||||
Operating lease cost | $ | 65,434 | $ |
June 30, 2019 | ||||
Cash paid for amounts included in the measurement of lease liabilities: | ||||
Operating cash flows | $ | 163,232 | ||
Right-of-use assets obtained in exchange for lease obligations: | ||||
Operating leases | $ | 10,610 |
June 30, 2020 | ||||
Cash paid for amounts included in the measurement of lease liabilities: | ||||
Operating cash flows | $ | 168,122 | ||
Right-of-use | ||||
Operating leases | $ | 19,255 |
June 30, 2019 | ||||
Operating leaseright-of-use assets | $ | 1,013,590 | ||
|
| |||
Other current liabilities | $ | 288,470 | ||
Operating lease liabilities | 801,264 | |||
|
| |||
Total operating lease liabilities | $ | 1,089,734 | ||
|
|
| ||||
|
Payments
June 30, 2020 | ||||
Operating lease right-of-use | $ | 71,711 | ||
Other current liabilities | $ | 197,896 | ||
Operating lease liabilities, net of current portion | — | |||
Total operating lease liabilities | $ | 197,896 | ||
Weighted average remaining lease term | 0.6 years | |||
Weighted average discount rate | 3.68% |
2019 (remaining six months) | $ | 166,492 | ||
2020 | 339,605 | |||
2021 | 349,788 | |||
2022 | 329,662 | |||
|
| |||
Total lease payments | 1,185,547 | |||
Less imputed interest | (95,813 | ) | ||
|
| |||
Total | $ | 1,089,734 | ||
|
|
2020 (remaining six months) | $ | |||
2021 | 28,860 | |||
2022 | — | |||
Total lease payments | 200,343 | |||
Less imputed interest | (2,447 | ) | ||
Total | $ | 197,896 | ||
6. |
|
Property and equipment, net consists of the following:
June 30, 2019 | December 31, 2018 | |||||||
Computer equipment | $ | 50,904 | $ | 52,704 | ||||
Furniture and equipment | 230,741 | 212,451 | ||||||
Leasehold improvements | — | 177,417 | ||||||
|
|
|
| |||||
281,645 | 442,572 | |||||||
Less: Accumulated depreciation | (134,026 | ) | (197,147 | ) | ||||
|
|
|
| |||||
Total property and equipment, net | $ | 147,619 | $ | 245,425 | ||||
|
|
|
|
Depreciation expense was $6,438 and $20,186, respectively, for the three andsix-month periods ended June 30, 2019 and $8,176 and $16,191, respectively for the three andsix-month periods ended June 30, 2018.
Accrued Expenses and Other Liabilities. |
June 30, 2019 | December 31, 2018 | |||||||
Accrued preclinical and clinical trial expenses | $ | 706,951 | $ | 821,633 | ||||
Accrued professional fees | 2,046,433 | 1,311,061 | ||||||
Accrued compensation and benefits | 1,262,446 | 1,941,449 | ||||||
Accrued license fees | 4,673,939 | 3,000,000 | ||||||
Lease liability | 288,470 | — | ||||||
Accrued variable consideration | 1,242,055 | — | ||||||
Deferred rent and lease incentive | — | 33,408 | ||||||
Accrued income tax | 449,651 | — | ||||||
Other | 152,858 | 66,436 | ||||||
|
|
|
| |||||
Current accrued expenses and other liabilities | 10,822,803 | 7,173,987 | ||||||
Lease liability -non-current | 801,264 | — | ||||||
Deferred rent and lease incentive –non-current | — | 154,799 | ||||||
|
|
|
| |||||
Non-current accrued expenses and other liabilities | 801,264 | 154,799 | ||||||
|
|
|
| |||||
Total accrued expenses and other liabilities | $ | 11,624,067 | $ | 7,328,786 | ||||
|
|
|
|
June 30, 2020 | December 31, 2019 | |||||||
Accrued preclinical and clinical trial expenses | $ | 651,692 | $ | 1,183,513 | ||||
Accrued professional fees | 2,464,197 | 1,241,526 | ||||||
Accrued compensation and benefits | 2,212,733 | 3,064,645 | ||||||
Accrued license fees | 5,866,161 | 8,751,991 | ||||||
Accrued purchases | 216,967 | 1,313,310 | ||||||
Accrued contributions | 660,000 | 1,535,000 | ||||||
Operating lease liability | 197,896 | 300,518 | ||||||
Accrued variable consideration | 1,023,537 | 884,764 | ||||||
Accrued income tax | 1,081,912 | 1,533,696 | ||||||
Other | 30,502 | 172,332 | ||||||
Current accrued expenses and other liabilities | 14,405,597 | 19,981,295 | ||||||
Lease liability—non-current | — | 647,532 | ||||||
Non-current accrued expenses and other liabilities | — | 647,532 | ||||||
Total accrued expenses and other liabilities | $ | 14,405,597 | $ | 20,628,827 | ||||
7. | Collaborative Arrangement. |
8. | Commitments and Contingencies. |
8. | Commitments and Contingencies (continued). |
lawsuit. See Note 13 (Subsequent Events).
9. | Agreements. |
a. |
|
|
b. |
|
10. | Income Taxes. |
The Company had no uncertain tax positionscarryovers as of June 30, 20192020 and December 31, 2018. 2019.
11. | Stockholders’ Equity. |
|
2016 Shelf Registration Statement
On2019. NaN shares of preferred stock were outstanding at June 30, 2020 and December 23, 2016, the31, 2019.
vote.
At
12. | Stock Compensation. |
Three months ended June 30, | Six months ended June 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Research and development | $ | 273,212 | $ | 285,625 | $ | 560,933 | $ | 579,940 | ||||||||
Selling, general and administrative | 651,784 | 505,882 | 1,297,474 | 1,182,907 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total stock-based compensation | $ | 924,996 | $ | 791,507 | $ | 1,858,407 | $ | 1,762,847 | ||||||||
|
|
|
|
|
|
|
|
Three months ended June 30, | Six months ended June 30, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
Research and development | $ | 421,220 | $ | 273,212 | $ | 839,273 | $ | 560,933 | ||||||||
Selling, general and administrative | 1,373,242 | 651,784 | 2,474,540 | 1,297,474 | ||||||||||||
Total stock-based compensation | $ | 1,794,462 | $ | 924,996 | $ | 3,313,813 | $ | 1,858,407 | ||||||||
|
2020.
During the three andsix-month
During the three andsix-month periods ended June 30, 2018, options to purchase 10,000 shares and 46,666 shares, respectively, of the Company’s common stock were exercised, with proceeds of $8,500 and $41,532, respectively, to the Company.
Common
There were no grants of common Units
13. | Subsequent Events. |
|
|
|
|
|
|
Overview
On November 28, 2018, we received approval from the FDA for Firdapsepayerpayor reimbursement (National Account Managers) personnel. We also have a field-based force of six medical science liaisons who are helping educate the medical communities and patients about LEMS and about our ongoing clinical trial activities evaluating Firdapse CMS,
FDA’s and Jacobus’ motions for summary judgement and deny Catalyst’s motion for summary judgement. We are currently conductingreviewing the Magistrate Judge’s decision, which we believe to be incorrect as a matter of law and contrary to the plain language of the Orphan Drug Act, and we intend to pursue the case further with the District Judge. The decision on whether to grant or deny our motion for summary judgement remains with the District Judge handling the case. We believe that if the Magistrate Judge’s recommendation is correct on the law, it means that the FDA has the authority to effectively eliminate the benefits of exclusivity under the Orphan Drug Act, which we believe will chill the incentive for drug companies like ourselves to spend the millions of dollars necessary to develop an orphan drug.
Because the FDA has granted Orphan Drug Designation for Firdapse® for the treatment of patients with CMS and Myasthenia Gravis (MG), if we are the first to receive approvals in the future for Firdapse® for the treatment of CMS orMuSK-MG, we would be eligible to receive seven years of marketing exclusivity for those indications added to our Firdapse® label. There can be no assurance that we will be the first to receive such approvals.
We are conducting aproof-of-concept clinical study evaluating Firdapse3, ambulatory.3. The study, which is designed asbeing conducted at trial sites in Italy and Serbia, has enrolled the anticipated 12 subjects in a randomized (1:1), double-blind,2-period,2-treatment,to evaluateevaluating the safety, tolerability and potential efficacy of amifampridine in ambulatory patients diagnosed with SMA Type 3. The study is planned to include approximately 12 patients, and we currently expect toreport top-line results from this study in the first half of 2020. Details of this trial are available on
We believe that our SMA Type 3 study will be completed this year and that we will be in a position to report
OnLEMS that we submitted in October 2019, was approved by Health Canada on August 4, 2020. Since there is no orphan exclusivity in Canada, there can be no assurance that any application for amifampridine filed by other parties will not be approved as well. As a result, we may face competition in Canada for LEMS patients in the future.
Finally,
Generic SabrilJapan or obtain orphan drug designation.
In September 2015,
Onunderlying patent dispute is resolved. For example, there may be patents or patent applications held by others that contain claims that our products or operations might be determined to infringe or that may be broader than we believe them to be. Given the complexities and uncertainties of patent laws, there can be no assurance as to the impact that future patent claims against us may have on our business, financial condition, results of operations, or prospects.
development expenses.
Available
the collaborative agreement to fluctuate in future periods based on our collaborator’s ability to meet various regulatory milestones set forth in such agreement.
manufactured and distributed.
2020 and 2019.
Three months ended June 30, | Change | |||||||||||||||
2020 | 2019 | $ | % | |||||||||||||
Research and development expenses | $ | 3,928,423 | $ | 4,356,152 | (427,729 | ) | (9.8 | ) | ||||||||
Employee stock-based compensation | 421,220 | 273,212 | 148,008 | 54.2 | ||||||||||||
Total research and development expenses | $ | 4,349,643 | $ | 4,629,364 | (279,721 | ) | (6.0 | ) | ||||||||
Three months ended June 30, | Change | |||||||||||||||
2019 | 2018 | $ | % | |||||||||||||
Research and development expenses | $ | 4,356,152 | $ | 3,419,199 | 936,953 | 27.4 | % | |||||||||
Employee stock-based compensation | 273,212 | 285,625 | (12,413 | ) | (4.3 | %) | ||||||||||
|
|
|
|
|
|
|
| |||||||||
Total research and development expenses | $ | 4,629,364 | $ | 3,704,824 | 924,540 | 25.0 | % | |||||||||
|
|
|
|
|
|
|
|
Research and development expenses for thesix-month periods ended June 30, 2019 and 2018 were approximately $7.9 million and $7.0 million, respectively, and represented approximately 25% and 57% of total operating costs and expenses for thesix-month periods ended June 30, 2019, and 2018 respectively. Research and development expenses for thesix-months ended June 30, 2019 and 2018 were as follows:
Six months ended June 30, | Change | |||||||||||||||
2019 | 2018 | $ | % | |||||||||||||
Research and development expenses | $ | 7,376,390 | $ | 6,383,926 | 992,464 | 15.5 | % | |||||||||
Employee stock-based compensation | 560,933 | 579,940 | (19,007 | ) | (3.3 | %) | ||||||||||
|
|
|
|
|
|
|
| |||||||||
Total research and development expenses | $ | 7,937,323 | $ | 6,963,866 | 973,457 | 14.0 | % | |||||||||
|
|
|
|
|
|
|
|
Six months ended June 30, | Change | |||||||||||||||
2020 | 2019 | $ | % | |||||||||||||
Research and development expenses | $ | 7,733,181 | $ | 7,376,390 | 356,791 | 4.8 | ||||||||||
Employee stock-based compensation | 839,273 | 560,933 | 278,340 | 49.6 | ||||||||||||
Total research and development expenses | $ | 8,572,454 | $ | 7,937,323 | 635,131 | 8.0 | ||||||||||
increases in headcount, medical and regulatory affairs and quality assurance expenses and expenses from our ongoing clinical trials evaluating Firdapse ® for the treatment ofMuSK-MG, and ourproof-of-concept ® for the treatment of SMA Type 3; andincreases |
decreases in employee stock-based compensation which is non cash
Three months ended June 30, | Change | |||||||||||||||
2019 | 2018 | $ | % | |||||||||||||
Selling | $ | 4,881,137 | $ | 847,351 | 4,033,786 | 476.0 | % | |||||||||
General and administrative | 3,454,801 | 1,277,798 | 2,177,003 | 170.4 | % | |||||||||||
Employee stock-based compensation | 651,784 | 505,882 | 145,902 | 28.8 | % | |||||||||||
|
|
|
|
|
|
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Total selling, general and administrative expenses | $ | 8,987,722 | $ | 2,631,031 | 6,356,691 | 241.6 | % | |||||||||
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Three months ended June 30, | Change | |||||||||||||||
2020 | 2019 | $ | % | |||||||||||||
Selling | $ | 5,621,780 | $ | 4,881,137 | 740,643 | 15.2 | ||||||||||
General and administrative | 3,838,336 | 3,454,801 | 383,535 | 11.1 | ||||||||||||
Employee stock-based compensation | 1,373,242 | 651,784 | 721,458 | 110.7 | ||||||||||||
Total selling, general and administrative expenses | $ | 10,833,358 | $ | 8,987,722 | 1,845,636 | 20.5 | ||||||||||
Six months ended June 30, | Change | |||||||||||||||
2019 | 2018 | $ | % | |||||||||||||
Selling | $ | 9,985,045 | $ | 1,463,199 | 8,521,846 | 582.4 | % | |||||||||
General and administrative | 6,121,663 | 2,659,323 | 3,462,340 | 130.2 | % | |||||||||||
Employee stock-based compensation | 1,297,474 | 1,182,907 | 114,567 | 9.7 | % | |||||||||||
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Total selling, general and administrative expenses | $ | 17,404,182 | $ | 5,305,429 | 12,098,753 | 228.0 | % | |||||||||
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Six months ended June 30, | Change | |||||||||||||||
2020 | 2019 | $ | % | |||||||||||||
Selling | $ | 11,425,925 | $ | 9,985,045 | 1,440,880 | 14.4 | ||||||||||
General and administrative | 6,995,941 | 6,121,663 | 874,278 | 14.3 | ||||||||||||
Employee stock-based compensation | 2,474,540 | 1,297,474 | 1,177,066 | 90.7 | ||||||||||||
Total selling, general and administrative expenses | $ | 20,896,406 | $ | 17,404,182 | 3,492,224 | 20.1 | ||||||||||
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business.
2019.
share, respectively), which excludes
Further, as of such date, substantially all such funds were invested in money market accounts and U.S. Treasuries.
We
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The 2017 Shelf Registration Statement expired on July 26, 2020.
July 31, 2020. As of the date of this Form10-Q,report, no offerings have been completed under the full amount of our 20162020 Shelf Registration Statement and $92.5 million of our 2017 Shelf Registration Statement remains available for future sales.
Statement.
Net cash provided by investing activities was $518,797 for the$29,772,428 and sales/maturities of investments of $30,310,595. Net cash used in investing activities was $36,802,791, for thesix-month period ended June 30, 2018, consisting primarily of purchases of short-term investments.
Net cash provided by financing activities during the30,2020 and 2019 was $62,350 and 2018 was $281,900, and $37,084, respectively, consisting primarily of proceeds from the exercise of options to purchase common stock.
Obligations and Arrangements.
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our estimates regarding anticipated capital requirements and our needs for additional financing in the future;
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whether
whether
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whether
changes
the
our
Whether the recent coronavirus outbreak will further affect the timing of our currently ongoing clinical trials; Whether the trial that |
whether we will be the first companyare currently undertaking to receive approval of3,4-DAPevaluate Firdapse
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whether
even
whether Catalyst
the ability of our third-party suppliers and contract manufacturers to maintain compliance with current Good Manufacturing Practices (cGMP);
the ability of our distributor and the specialty pharmacies that distribute our product to maintain compliance with applicable law; and
our ability to maintain compliance with applicable rules relating to our patient assistance programs and our contributions to 501(c)(3) organizations that support LEMS patients.
a. | We have carried out an evaluation, under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and15d-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Based on such evaluation, our principal executive officer and principal financial officer have concluded that as of June 30, |
b. | During the three months ended June 30, |
In May 2019, we became aware that the FDA had approved an NDA for Jacobus Pharmaceuticals for Ruzurgi™, their version of amifampridine(3,4-DAP) for pediatric LEMS patients. On June 12, 2019, we announced that we have filed suit against the FDA and several related parties challenging this approval and related drug labeling. TheOur complaint, which was filed in the federal district court for the Southern District of Florida, alleges that the FDA’s approval of Ruzurgi™
Additionally, frommotion for summary judgement remains with the District Judge handling the case.
The following is an additional risk factor regarding factors that you should consider that has recently arisen:
The FDA has approved Ruzurgi™, another formulation of amifampridine(3,4-DAP) for LEMS for the treatment of pediatric patients.
In May 2019, we became aware that Jacobus Pharmaceutical had been granted approval of an NDA for Ruzurgi™, their version of amifampridine(3,4-DAP) for pediatric LEMS patients (ages 6 to under 17). We expect that Jacobus may offer Ruzurgi™ at a lower price than we are able to offer Firdapse®. In addition, while the NDA for Ruzurgi™ only covers pediatric patients, we believe there is a significant risk that it will be prescribedoff-label in adult patients. While we believe that this approval was violative of our statutory rights and was in multiple other respects arbitrary, capricious, and contrary to law, and we have filed suit to that effect, there can be no assurance that our claims will be successful. If Jacobus is able to successfully sell Ruzurgi™off-label for adult LEMS patients, it could have a material adverse effect on our future business, financial condition and results of operations.
31.1 | Certification of Principal Executive Officer under Section 302 of the Sarbanes-Oxley Act of 2002 | |
31.2 | Certification of Principal Financial Officer under Section 302 of the Sarbanes-Oxley Act of 2002 | |
32.1 | Certification of Principal Executive Officer under Section 906 of the Sarbanes-Oxley Act of 2002 | |
32.2 | Certification of Principal Financial Officer under Section 906 of the Sarbanes-Oxley Act of 2002 | |
101.INS | Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. | |
101.SCH | Inline XBRL Taxonomy Extension Schema Document | |
101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document | |
101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document | |
101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document | |
101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document | |
104 | The cover page for the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2020, has been formatted in Inline XBRL. |
Catalyst Pharmaceuticals, Inc. | ||
By: | /s/ Alicia Grande | |
Alicia Grande | ||
Vice President, Treasurer and Chief Financial Officer |
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