☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
☐ | TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Large accelerated filer | ☐ | Accelerated Filer | ☒ | |||
Non-accelerated filer | ☐ | Smaller reporting company | ☐ | |||
Emerging growth company | ☐ |
Item 1. | FINANCIAL STATEMENTS |
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Item 2. | 23 | ||||||||
Item 3. | 35 | ||||||||
Item 4. | 36 | ||||||||
PART II. OTHER INFORMATION | |||||||||
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Item 1. | 36 | ||||||||
Item 1A. | 36 | ||||||||
Item 2. | 37 | ||||||||
Item 3. | 37 | ||||||||
Item 4. | 37 | ||||||||
Item 5. | 37 | ||||||||
Item 6. | 37 | ||||||||
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38 |
March 31, | December 31, | |||||||
2020 | 2019 | |||||||
(unaudited) | ||||||||
ASSETS | ||||||||
Current Assets: | ||||||||
Cash and cash equivalents | $ | 101,750,937 | $ | 89,511,710 | ||||
Short-term investments | — | 5,007,050 | ||||||
Accounts receivable, net | 6,918,563 | 10,536,997 | ||||||
Inventory | 2,211,338 | 1,956,792 | ||||||
Prepaid expenses and other current assets | 6,062,715 | 4,351,074 | ||||||
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Total current assets | 116,943,553 | 111,363,623 | ||||||
Operating leaseright-of-use asset | 730,284 | 793,252 | ||||||
Property and equipment, net | 196,926 | 210,467 | ||||||
Deposits | 8,888 | 8,888 | ||||||
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Total assets | $ | 117,879,651 | $ | 112,376,230 | ||||
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LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
Current Liabilities: | ||||||||
Accounts payable | $ | 1,347,577 | $ | 4,117,447 | ||||
Accrued expenses and other liabilities | 16,287,936 | 19,981,295 | ||||||
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Total current liabilities | 17,635,513 | 24,098,742 | ||||||
Operating lease liability, net of current portion | 568,421 | 647,532 | ||||||
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Total liabilities | 18,203,934 | 24,746,274 | ||||||
Commitments and contingencies | ||||||||
Stockholders’ equity: | ||||||||
Preferred stock, $0.001 par value, 5,000,000 shares authorized: none issued and outstanding at March 31, 2020 and December 31, 2019 | — | — | ||||||
Common stock, $0.001 par value, 150,000,000 shares authorized; 103,408,699 shares and 103,397,033 shares issued and outstanding at March 31, 2020 and December 31, 2019, respectively | 103,409 | 103,397 | ||||||
Additionalpaid-in capital | 217,751,166 | 216,205,678 | ||||||
Accumulated deficit | (118,262,609 | ) | (128,688,624 | ) | ||||
Accumulated other comprehensive income (loss) | 83,751 | 9,505 | ||||||
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Total stockholders’ equity | 99,675,717 | 87,629,956 | ||||||
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Total liabilities and stockholders’ equity | $ | 117,879,651 | $ | 112,376,230 | ||||
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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 March 31, | ||||||||
2020 | 2019 | |||||||
Product revenue, net | $ | 29,136,472 | $ | 12,448,438 | ||||
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Operating costs and expenses: | ||||||||
Cost of sales | 4,150,866 | 1,711,788 | ||||||
Research and development | 4,222,811 | 3,307,959 | ||||||
Selling, general and administrative | 10,063,048 | 8,416,460 | ||||||
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Total operating costs and expenses | 18,436,725 | 13,436,207 | ||||||
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Operating income (loss) | 10,699,747 | (987,769 | ) | |||||
Other income, net | 336,233 | 343,266 | ||||||
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Net income (loss) before income taxes | 11,035,980 | (644,503 | ) | |||||
Provision for income taxes | 609,965 | — | ||||||
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Net income (loss) | $ | 10,426,015 | $ | (644,503 | ) | |||
Net income (loss) per share: | ||||||||
Basic | $ | 0.10 | $ | (0.01 | ) | |||
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Diluted | $ | 0.10 | $ | (0.01 | ) | |||
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Weighted average shares outstanding: | ||||||||
Basic | 103,407,347 | 102,747,923 | ||||||
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Diluted | 106,534,600 | 102,747,923 | ||||||
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Net income (loss) | $ | 10,426,015 | $ | (644,503 | ) | |||
Other comprehensive income (loss): | ||||||||
Unrealized gain (loss) onavailable-for-sale securities | 74,246 | 13,560 | ||||||
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Comprehensive income (loss) | $ | 10,500,261 | $ | (630,943 | ) | |||
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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 | ||||||||
Common Stock | Additional | Accumulated Other | ||||||||||||||||||||||||||
Preferred Stock | Shares | Amount | Paid-in Capital | Accumulated Deficit | Comprehensive 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 | |||||||||||||||||||||
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Balance at March 31, 2020 | $ | — | 103,408,699 | $ | 103,409 | $ | 217,751,166 | $ | (118,262,609 | ) | $ | 83,751 | $ | 99,675,717 | ||||||||||||||
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Common Stock | Additional | Accumulated Other | ||||||||||||||||||||||||||
Preferred Stock | Shares | Amount | Paid-in Capital | Accumulated Deficit | Comprehensive 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 | ) | |||||||||||||||||||
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Balance at March 31, 2019 | $ | — | 102,804,257 | $ | 102,804 | $ | $212,287,975 | $ | (161,208,464 | ) | $ | (6,688 | ) | $ | 51,175,627 | |||||||||||||
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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 Three Months Ended March 31, | ||||||||
2020 | 2019 | |||||||
Operating Activities: | ||||||||
Net income (loss) | $ | 10,426,015 | $ | (644,503 | ) | |||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||||||||
Depreciation | 13,541 | 13,748 | ||||||
Amortization ofright-of-use asset | 62,968 | 59,621 | ||||||
Stock-based compensation | 1,519,351 | 933,411 | ||||||
Change in accrued interest and accretion of discount on investments | 81,296 | (53,674 | ) | |||||
(Increase) decrease in: | ||||||||
Accounts receivable, net | 3,618,434 | (7,251,381 | ) | |||||
Inventory | (254,546 | ) | (40,575 | ) | ||||
Prepaid expenses and other current assets and deposits | (1,711,641 | ) | (231,485 | ) | ||||
Increase (decrease) in: | ||||||||
Accounts payable | (2,769,870 | ) | 602,719 | |||||
Accrued expenses and other liabilities | (3,699,518 | ) | (1,337,155 | ) | ||||
Operating lease liability | (72,952 | ) | (67,155 | ) | ||||
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Net cash provided by (used in) operating activities | 7,213,078 | (8,016,429 | ) | |||||
Investing Activities: | ||||||||
Purchases of property and equipment | — | (5,633 | ) | |||||
Purchases of investments | — | (9,944,974 | ) | |||||
Proceeds from maturities and sales of investments | 5,000,000 | 20,400,000 | ||||||
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Net cash provided by (used in) investing activities | 5,000,000 | 10,449,393 | ||||||
Financing Activities: | ||||||||
Proceeds from exercise of stock options | 26,149 | 89,350 | ||||||
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Net cash provided by (used in) financing activities | 26,149 | 89,350 | ||||||
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Net increase (decrease) in cash and cash equivalents | 12,239,227 | 2,522,314 | ||||||
Cash and cash equivalents—beginning of period | 89,511,710 | 16,559,400 | ||||||
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Cash and cash equivalents—end of period | $ | 101,750,937 | $ | 19,081,714 | ||||
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Non-cash investing and financing activities: | ||||||||
Unrealized gain (loss) onavailable-for-sale securities | $ | 74,246 | $ | 13,560 |
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. |
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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e. |
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March 31,June 30, 2020 and December 31, 2019, there were no0 investments classified as trading securities, as the Company sold its interest in the short-term bond fund in 2019. There were no sales ofwas 0 realized or unrealized gain (loss) on trading securities for the three and six months ended March 31,June 30, 2020. Realized losses on trading securities during the three and six months ended March 31,June 30, 2019 were $4,980.$0 and $4,980, respectively. Unrealized gain (loss) on trading securities was $0$36,664 and $52,741, respectively,$89,405 for the three and six months ended March 31, 2020 and March 31,June 30, 2019 and is included in other income, net in the accompanying consolidated statements of operations.2.Basis of Presentation and Significant Accounting Policies (continued).
2. | Basis of Presentation and Significant Accounting Policies (continued). |
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2. | Basis of Presentation and Significant Accounting Policies (continued). |
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Fair Value Measurements at Reporting Date Using | ||||||||||||||||
Balances as of March 31, 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 | $ | 23,610,888 | $ | 23,610,888 | $ | — | $ | — | ||||||||
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U.S. Treasuries | $ | 69,997,200 | $ | — | $ | 69,997,200 | $ | — | ||||||||
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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 | $ | — | $ | — | ||||||||
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U.S. Treasuries | $ | 59,932,200 | $ | — | $ | 59,932,200 | $ | — | ||||||||
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Short-term investments: | ||||||||||||||||
U.S. Treasuries | $ | 5,007,050 | $ | — | $ | 5,007,050 | $ | — | ||||||||
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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 | $ | — | ||||||||
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2. | Basis of Presentation and Significant Accounting Policies (continued). |
June 30, 2020
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2. | Basis of Presentation and Significant Accounting Policies (continued). |
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2. | Basis of Presentation and Significant Accounting Policies (continued). |
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The milestone was not achieved in the three and six months ended June 30, 2020 and 2019.
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2. | Basis of Presentation and Significant Accounting Policies ( continued ). |
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2. | Basis of Presentation and Significant Accounting Policies (continued). |
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For the Three Months Ended March 31, | ||||||||
2020 | 2019 | |||||||
Basic weighted average common shares outstanding | 103,407,347 | 102,747,923 | ||||||
Effect of dilutive securities: | ||||||||
Unvested restricted stock units subject to vesting requirements issued to employees andnon-employees | 352,500 | — | ||||||
Common stock issuable upon the exercise of stock options | 2,774,753 | — | ||||||
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Diluted weighted average common shares outstanding | 106,534,600 | 102,747,923 | ||||||
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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 | ||||||||||||
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2. | Basis of Presentation and Significant Accounting Policies (continued). |
3. | Investments. |
At March 31, 2020: U.S. Treasuries – Cash equivalents At December 31, 2019: U.S. Treasuries – Cash equivalents U.S. Treasuries – ST Total Estimated
Fair Value Gross
Unrealized
Gains Gross
Unrealized
Losses Amortized
Cost $ 69,997,200 $ 83,751 $ — $ 69,913,449 $ 59,932,200 $ 2,042 $ — $ 59,930,158 5,007,050 7,463 — 4,999,587 $ 64,939,250 $ 9,505 $ — $ 64,929,745
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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 | ||||||||
The Company did not hold any securities in an unrealized position for more than 12 months as of March 31,June 30, 2020.
March 31, 2020 | ||||
Due in one year or less | $ | 69,997,200 | ||
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June 30, 2020 | ||||
Due in one year or less | $ | 84,990,900 | ||
4. | Prepaid Expenses and Other Current Assets. |
March 31, 2020 | December 31, 2019 | |||||||
Prepaid manufacturing costs | $ | 3,471,078 | $ | 1,526,013 | ||||
Prepaid insurance | 995,146 | 1,263,129 | ||||||
Prepaid subscription fees | 492,716 | 501,251 | ||||||
Prepaid research fees | 490,102 | 481,057 | ||||||
Prepaid commercialization expenses | 287,083 | 62,959 | ||||||
Other | 326,590 | 516,665 | ||||||
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Total prepaid expenses and other current assets | $ | 6,062,715 | $ | 4,351,074 | ||||
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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. |
March 31, 2020 | ||||
Operating lease cost | $ | 74,079 |
For the Three Months Ended June 30, 2020 | For the Six Months Ended June 30, 2020 | |||||||
Operating lease cost | $ | 65,434 | $ |
March 31, 2020 | ||||
Cash paid for amounts included in the measurement of lease liabilities: | ||||
Operating cash flows | $ | 84,061 | ||
Right-of-use assets obtained in exchange for lease obligations: | ||||
Operating leases | $ | 5,305 |
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 |
March 31, 2020 | ||||
Operating leaseright-of-use assets | $ | 730,284 | ||
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Other current liabilities | $ | 306,677 | ||
Operating lease liabilities, net of current portion | 568,421 | |||
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Total operating lease liabilities | $ | 875,098 | ||
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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% |
2020 (remaining nine months) | $ | 255,544 | ||
2021 | 349,788 | |||
2022 | 329,662 | |||
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Total lease payments | 934,994 | |||
Less imputed interest | (59,896 | ) | ||
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Total | $ | 875,098 | ||
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2020 (remaining six months) | $ | |||
2021 | 28,860 | |||
2022 | — | |||
Total lease payments | 200,343 | |||
Less imputed interest | (2,447 | ) | ||
Total | $ | 197,896 | ||
6. | Accrued Expenses and Other Liabilities. |
March 31, 2020 | December 31, 2019 | |||||||
Accrued preclinical and clinical trial expenses | $ | 940,963 | $ | 1,183,513 | ||||
Accrued professional fees | 3,309,351 | 1,241,526 | ||||||
Accrued compensation and benefits | 1,814,396 | 3,064,645 | ||||||
Accrued license fees | 3,945,991 | 8,751,991 | ||||||
Accrued purchases | 1,243,991 | 1,313,310 | ||||||
Accrued contributions | 1,135,000 | 1,535,000 | ||||||
Operating lease liability | 306,677 | 300,518 | ||||||
Accrued variable consideration | 1,308,344 | 884,764 | ||||||
Income tax payable | 2,143,490 | 1,533,696 | ||||||
Other | 139,733 | 172,332 | ||||||
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Current accrued expenses and other liabilities | 16,287,936 | 19,981,295 | ||||||
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Leaseliability—non-current | 568,421 | 647,532 | ||||||
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Non-current accrued expenses and other liabilities | 568,421 | 647,532 | ||||||
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Total accrued expenses and other liabilities | $ | 16,856,357 | $ | 20,628,827 | ||||
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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. |
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8. | Commitments and Contingencies. |
8. | Commitments and Contingencies (continued). |
See Note 13 (Subsequent Events).
9. | Agreements. |
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10. | Income Taxes. |
11. | Stockholders’ Equity. |
March 31,June 30, 2020 and December 31, 2019. NoNaN shares of preferred stock were outstanding at March 31,June 30, 2020 and December 31, 2019.11.Stockholders’ Equity (continued).March 31,June 30, 2020 and December 31, 2019, 103,408,699103,422,032 and 103,397,033 shares, respectively, of common stock were issued and outstanding. Each holder of common stock is entitled to one1 vote of each share of common stock held of record on all matters on which stockholders generally are entitled to vote. (theAt March 31,there is approximately $92.5 million available for future sale underon July 26, 2020, the 2017 Shelf Registration Statement expired.
12. | Stock Compensation. |
Three months ended March 31, | ||||||||
2020 | 2019 | |||||||
Research and development | $ | 418,053 | $ | 287,721 | ||||
Selling, general and administrative | 1,101,298 | 645,690 | ||||||
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Total stock-based compensation | $ | 1,519,351 | $ | 933,411 | ||||
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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 | ||||||||
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There were no grants of
13. | Subsequent Events. |
On May 7,
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COVID-19
We were fortunate that all subjects were enrolled in
We have filed a motion for summary judgement in our case, and the FDA has filed a cross motion for summary judgement. Further, Jacobus has intervened in the case and has filed their own cross motion for summary judgement. Based on currently available information, we expect
We recently completedorphan drug.
We were fortunate
If our trial is successful,has been thoroughly evaluated, we intend to filemeet with our neuromuscular advisors and determine our path forward for this indication. We plan to make the results of this study available in a supplemental new drug application (sNDA) with the FDA for theMUSK-MG indication.
future scientific forum
We have identified and recruited all of the subjects necessary to complete thisproof-of-concept study. However, the last seven subjects will not be able to complete the study until the trial sites conducting the study are permitted to resume clinical trial activities. While there can be no assurance, we now believe that thisour SMA Type 3 study will be completed later this year and that we will be in a position to report
Insymptomatic treatment of LEMS that we submitted in October 2019, we submitted an NDS inwas approved by Health Canada seeking approval of Firdapse® for the treatment of LEMS. Our application has been accepted for review and we have been granted a priority review. There can be no assurance that our application will be approved. In addition, sinceon August 4, 2020. Since there is no orphan exclusivity in Canada, even if our NDS for Firdapse® is approved, there can be no assurance that any application for amifampridine filed by other parties will not be approved as well. As a result, even if our NDS is approved, we may face competition in Canada for LEMS patients.
patients in the future.
Japan or obtain orphan drug designation.
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 March 31, | Change | |||||||||||||||
2020 | 2019 | $ | % | |||||||||||||
Research and development expenses | $ | 3,804,758 | $ | 3,020,238 | 784,520 | 26.0 | % | |||||||||
Employee stock-based compensation | 418,053 | 287,721 | 130,332 | 45.3 | % | |||||||||||
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Total research and development expenses | $ | 4,222,811 | $ | 3,307,959 | 914,852 | 27.7 | % | |||||||||
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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 |
increase of $130,332SMA Type 3; and
diseases.
Three months ended March 31, | Change | |||||||||||||||
2020 | 2019 | $ | % | |||||||||||||
Selling | $ | 5,804,145 | $ | 5,103,908 | 700,237 | 13.7 | % | |||||||||
General and administrative | 3,157,605 | 2,666,862 | 490,743 | 18.4 | % | |||||||||||
Employee stock-based compensation | 1,101,298 | 645,690 | 455,608 | 70.6 | % | |||||||||||
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Total selling, general and administrative expenses | $ | 10,063,048 | $ | 8,416,460 | 1,646,588 | 19.6 | % | |||||||||
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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 | |||||||||||||||
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 | ||||||||||
increase of approximately $0.7 million
increases in general and administrative expenses, which are primarily due to the expansion |
increase of approximately $0.5 millionour operations and headcount to support our ongoing efforts to expand our net revenues from sales of Firdapse
approximately $925,000 and $1.9 million, respectively.
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The 2017 Shelf Registration Statement expired on July 26, 2020.
Statement.
Net cash provided by investing activities was $5,000,000, for the three-month
$29,772,428.
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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 |
b. | During the three months ended |
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 |
41