DOCUMENT AND ENTITY INFORMATION
DOCUMENT AND ENTITY INFORMATION - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Mar. 31, 2018 | Jun. 30, 2017 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | Precipio, Inc. | ||
Entity Central Index Key | 1,043,961 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Smaller Reporting Company | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2017 | ||
Document Fiscal Year Focus | 2,017 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Public Float | $ 49.6 | ||
Entity Common Stock, Shares Outstanding | 19,668,572 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
CURRENT ASSETS: | ||
Cash | $ 421 | $ 51 |
Accounts receivable, net | 730 | 388 |
Inventories | 161 | 100 |
Other current assets | 430 | 13 |
Total current assets | 1,742 | 552 |
PROPERTY AND EQUIPMENT, NET | 353 | 280 |
OTHER ASSETS: | ||
Goodwill | 4,685 | |
Intangibles, net | 20,458 | |
Other assets | 22 | 10 |
Assets | 27,260 | 842 |
CURRENT LIABILITIES: | ||
Current maturities of long-term debt | 587 | 395 |
Convertible bridge notes, less debt discounts and debt issuance costs | 695 | |
Accounts payable | 5,103 | 1,084 |
Current maturities of capital leases | 50 | 46 |
Accrued expenses | 1,248 | 700 |
Deferred revenue | 66 | 92 |
Other current liabilities | 2,982 | |
Total current liabilities | 10,036 | 3,012 |
LONG TERM LIABILITIES: | ||
Long-term debt, less current maturities and discounts | 2,829 | 4,127 |
Common stock warrant liability | 841 | |
Capital leases, less current maturities | 113 | 163 |
Other long-term liabilities | 67 | |
Total liabilities | 14,235 | 7,302 |
STOCKHOLDERS' EQUITY (DEFICIT): | ||
Preferred stock - $0.01 par value, 15,000,000 and 1,294,434 shares authorized at December 31, 2017 and December 31, 2016, respectively, 4,935 and 780,105 shares issued and outstanding at December 31, 2017 and December 31, 2016, respectively | 8 | |
Common stock, $0.01 par value, 150,000,000 and 1,806,850 shares authorized at December 31, 2017 and December 31, 2016, respectively, 10,196,620 and 449,175 shares issued and outstanding at December 31, 2017 and December 31, 2016, respectively | 102 | 4 |
Additional paid-in capital | 44,465 | 4,376 |
Accumulated deficit | (31,542) | (10,848) |
Total stockholders' equity (deficit) | 13,025 | (6,460) |
Liabilities and stockholders' equity | $ 27,260 | $ 842 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2017 | Dec. 31, 2016 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 15,000,000 | 1,294,434 |
Preferred stock, shares issued (in shares) | 4,935 | 780,105 |
Preferred stock, shares outstanding (in shares) | 4,935 | 780,105 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 150,000,000 | 1,806,850 |
Common stock, shares issued (in shares) | 10,196,620 | 449,175 |
Common stock, shares outstanding (in shares) | 10,196,620 | 449,175 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Income Statement [Abstract] | ||
Service revenue, net | $ 1,702 | $ 2,101 |
Clinical research grants | 278 | |
Other | 53 | |
Revenue, net of contractual allowances and adjustments | 2,033 | 2,101 |
less allowance for doubtful accounts | (310) | (378) |
Net sales | 1,723 | 1,723 |
Service revenues | 1,317 | 970 |
Clinical research grants | 114 | |
Total cost of sales | 1,431 | 970 |
Gross profit (loss) | 292 | 753 |
OPERATING EXPENSES: | ||
Operating expenses | 6,488 | 2,465 |
Impairment of goodwill | 9,315 | |
TOTAL OPERATING EXPENSES | 15,803 | 2,465 |
OPERATING LOSS | (15,511) | (1,712) |
OTHER INCOME (EXPENSE): | ||
Interest expense, net | (2,324) | (518) |
Warrant revaluation | (226) | |
Loss on extinguishment of debt and induced conversion of convertible bridge notes | (1,391) | |
Gain on settlement liability, net | 877 | |
Gain on troubled debt restructuring | 1,181 | |
Loss on settlement of equity instrument | (624) | |
Merger advisory fees | (2,676) | |
Other, net | 3 | |
Other Income (Expense) | (5,183) | (515) |
LOSS BEFORE INCOME TAXES | (20,694) | (2,227) |
INCOME TAX EXPENSE | ||
NET LOSS | (20,694) | (2,227) |
DEEMED DIVIDENDS ON ISSUANCE OR EXCHANGE OF PREFERRED UNITS | (12,431) | (1,422) |
PREFERRED DIVIDENDS | (84) | (433) |
TOTAL DIVIDENDS | (12,515) | (1,855) |
NET LOSS AVAILABLE TO COMMON STOCKHOLDERS | $ (33,209) | $ (4,082) |
BASIC AND DILUTED LOSS PER COMMON SHARE (IN DOLLARS PER SHARE) | $ (7.16) | $ (9.44) |
BASIC AND DILUTED WEIGHTED-AVERAGE SHARES OF COMMON STOCK OUTSTANDING (IN SHARES) | 4,639,226 | 432,582 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT) - USD ($) $ in Thousands | Restructuring Liability [Member]Additional Paid-in Capital [Member] | Restructuring Liability [Member] | Side Warrants [Member]Additional Paid-in Capital [Member] | Side Warrants [Member] | Note Conversion WarrantsAdditional Paid-in Capital [Member] | Note Conversion Warrants | Preferred Stock [Member]Preferred Stock [Member] | Preferred Stock [Member] | Common Stock [Member]Common Stock [Member] | Common Stock [Member] | Additional Paid-in Capital [Member]Common Stock [Member] | Additional Paid-in Capital [Member]Preferred Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] | Common Stock [Member] | Preferred Stock [Member] | Total |
Balance at beginning of period at Dec. 31, 2015 | $ 13 | $ 4 | $ 4,652 | $ (6,766) | $ (2,097) | ||||||||||||
Balance at beginning of period (in shares) at Dec. 31, 2015 | 1,263,429 | 422,803 | |||||||||||||||
Increase (Decrease) in Stockholders' Equity | |||||||||||||||||
Net loss | (2,227) | (2,227) | |||||||||||||||
Preferred dividends | (433) | (433) | |||||||||||||||
Exchange of preferred stock to notes and warrants | $ (5) | (1,710) | (1,715) | ||||||||||||||
Exchanged of preferred stock to notes and warrants, shares | (483,324) | ||||||||||||||||
Deemed dividends on exchange of preferred | 1,422 | (1,422) | |||||||||||||||
Shares converted, value | (433) | ||||||||||||||||
Non-cash stock-based compensation and vesting of restricted units | 12 | 12 | |||||||||||||||
Non-cash stock-based compensation and vesting of restricted units (in shares) | 26,372 | ||||||||||||||||
Balance at end of period at Dec. 31, 2016 | $ 8 | $ 4 | 4,376 | (10,848) | (6,460) | ||||||||||||
Balance at end of period (in shares) at Dec. 31, 2016 | 780,105 | 449,175 | |||||||||||||||
Increase (Decrease) in Stockholders' Equity | |||||||||||||||||
Net loss | (20,694) | (20,694) | |||||||||||||||
Conversion of warrants into stock | $ 20 | $ (20) | $ 25 | $ 25 | |||||||||||||
Conversion of warrants into stock (in shares) | 8,542 | 1,958,166 | |||||||||||||||
Shares converted, value | $ (25) | $ 42 | (17) | ||||||||||||||
Conversion of preferred stock into common stock (in shares) | (2,527,879) | 4,217,408 | |||||||||||||||
Conversion of debt into stock | $ 8 | $ 6 | $ 14 | $ 2,732 | 4,749 | $ 2,738 | 4,771 | ||||||||||
Conversion of debt into stock (in shares) | 802,920 | 515,638 | 1,414,700 | ||||||||||||||
Issuance of common stock for consulting services in connection with the merger | $ 3 | 2,186 | 2,189 | ||||||||||||||
Issuance of common stock for consulting services in connection with the merger (in shares) | 321,821 | ||||||||||||||||
Shares issued in connection with business combination | $ 8 | $ 12 | 20,078 | 20,098 | |||||||||||||
Shares issued in connection with business combination (in shares) | 802,925 | 1,255,119 | |||||||||||||||
Issuance of warrants | $ 159 | $ 159 | $ 487 | $ 487 | $ 15 | $ 15 | $ 1 | 7,783 | 7,784 | ||||||||
Issuance of preferred stock (in shares) | 138,322 | ||||||||||||||||
Issuance of warrants | $ 159 | $ 159 | $ 487 | $ 487 | $ 15 | $ 15 | $ 1 | 7,783 | 7,784 | ||||||||
Beneficial conversion feature on issuance of bridge notes | 1,856 | 1,856 | |||||||||||||||
Non-cash stock-based compensation and vesting of restricted units | $ 1 | 56 | 57 | ||||||||||||||
Non-cash stock-based compensation and vesting of restricted units (in shares) | 64,593 | ||||||||||||||||
Balance at end of period at Dec. 31, 2017 | $ 102 | $ 44,465 | $ (31,542) | $ 13,025 | |||||||||||||
Balance at end of period (in shares) at Dec. 31, 2017 | 4,935 | 10,196,620 |
UNAUDITED CONDENSED CONSOLIDATE
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
CASH FLOWS USED IN OPERATING ACTIVITIES: | ||
Net loss | $ (20,694,000) | $ (2,227,000) |
Adjustments to reconcile net loss to net cash flows used in operating activities: | ||
Depreciation and amortization | 743,000 | 112,000 |
Amortization of deferred financing costs and debt discount | 1,898,000 | 33,000 |
Loss on extinguishment of debt and induced conversion of convertible bridge notes | 1,391,000 | |
Gain on settlement of liability | (877,000) | |
Gain on settlement of troubled debt | (1,181,000) | |
Loss on settlement of equity instrument | 624,000 | |
Stock-based compensation and change in liability of stock appreciation rights | 49,000 | 12,000 |
Merger advisory fees | 2,676,000 | |
Impairment of goodwill | 9,315,000 | |
Provision for losses on doubtful accounts | 310,000 | 378,000 |
Capitalized PIK interest on convertible bridge notes | 85,000 | |
Warrant revaluation | 226,000 | |
Changes in operating assets and liabilities: | ||
Accounts receivable | (495,000) | (310,000) |
Inventories | (46,000) | (17,000) |
Other assets | (99,000) | (8,000) |
Accounts payable | 500,000 | 344,000 |
Accrued expenses and other liabilities | (1,030,000) | 639,000 |
Net cash used in operating activities | (6,690,000) | (959,000) |
CASH FLOWS PROVIDED BY INVESTING ACTIVITIES: | ||
Cash acquired in business combination | 101,000 | |
Purchase of property and equipment | (143,000) | |
Net cash provided by investing activities | (42,000) | |
CASH FLOWS PROVIDED BY FINANCING ACTIVITIES: | ||
Principal payments on capital lease obligations | (46,000) | (41,000) |
Issuance of preferred stock | 7,784,000 | |
Payment of deferred financing costs | (25,000) | (10,000) |
Proceeds from exercise of warrants | 25,000 | |
Proceeds from long-term debt | 315,000 | 525,000 |
Proceeds from convertible bridge notes | 1,365,000 | 455,000 |
Principal payments on convertible bridge notes | (1,500,000) | |
Principal payments on long-term debt | (816,000) | (154,000) |
Net cash flows provided by financing activities | 7,102,000 | 775,000 |
NET CHANGE IN CASH AND CASH EQUIVALENTS | 370,000 | (184,000) |
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD | 51,000 | 235,000 |
CASH AND CASH EQUIVALENTS AT END OF PERIOD | 421,000 | 51,000 |
SUPPLEMENTAL CASH FLOW INFORMATION | ||
Cash paid during the period for interest | 107,000 | 126,000 |
SUPPLEMENTAL DISCLOSURE OF NON-CASH INFORMATION | ||
Purchases of equipment financed through capital lease | 49,000 | |
Preferred unit dividend financed through exchange agreement | 433,000 | |
Convertible bridge notes exchanged for long-term debt | 1,120,000 | |
Series A and B preferred exchanged for long-term debt | $ 1,715,000 | |
Deferred debt issuance cost | 64,000 | |
Beneficial conversion feature on issuance of bridge notes | 1,856,000 | |
Recorded beneficial conversion feature on debt | 1,856,000 | |
Accrued merger cost | 10,000 | |
Issuance of warrants | 7,784,000 | |
Purchases of equipment financed through accounts payable | 2,000 | |
Prepaid insurance financed with loan | 183,000 | |
Side Warrants [Member] | ||
Adjustments to reconcile net loss to net cash flows used in operating activities: | ||
Merger advisory fees | 487,000 | |
SUPPLEMENTAL DISCLOSURE OF NON-CASH INFORMATION | ||
Issuance of warrants | 487,000 | |
Restructuring Liability [Member] | ||
SUPPLEMENTAL DISCLOSURE OF NON-CASH INFORMATION | ||
Issuance of warrants | 159,000 | |
Promissory Notes Waiver [Member] | ||
SUPPLEMENTAL DISCLOSURE OF NON-CASH INFORMATION | ||
Issuance of warrants | 15,000 | |
Senior and Junior Notes [Member] | ||
SUPPLEMENTAL DISCLOSURE OF NON-CASH INFORMATION | ||
Conversion of debt into stock | 4,771,000 | |
Bridge Loan [Member] | ||
Adjustments to reconcile net loss to net cash flows used in operating activities: | ||
Loss on extinguishment of debt and induced conversion of convertible bridge notes | 400,000 | |
SUPPLEMENTAL DISCLOSURE OF NON-CASH INFORMATION | ||
Conversion of debt into stock | $ 1,787,000 |
BUSINESS DESCRIPTION
BUSINESS DESCRIPTION | 12 Months Ended |
Dec. 31, 2017 | |
BUSINESS DESCRIPTION [Abstract] | |
BUSINESS DESCRIPTION | 1. BUSINESS DESCRIPTION Business Description. Precipio, Inc., and Subsidiary, (“we”, “us”, “our”, the “Company” or “Precipio”) is a cancer diagnostics company providing diagnostic products and services to the oncology market. We have built and continue to develop a platform designed to eradicate the problem of misdiagnosis by harnessing the intellect, expertise and technology developed within academic institutions and delivering quality diagnostic information to physicians and their patients worldwide. We operate a cancer diagnostic laboratory located in New Haven, Connecticut and have partnered with the Yale School of Medicine to capture the expertise, experience and technologies developed within academia so that we can provide a better standard of cancer diagnostics and solve the growing problem of cancer misdiagnosis. We also operate a research and development facility in Omaha, Nebraska which will focus on further development of ICE-COLD-PCR (“ICP”), the patented technology which was exclusively licensed by us from Dana-Farber Cancer Institute, Inc. (“Dana-Farber”) at Harvard University (“Harvard”). The research and development center will focus on the development of this technology, which we believe will enable us to commercialize other technologies developed by our current and future academic partners. Our platform connects patients, physicians and diagnostic experts residing within academic institutions. Launched in 2017, the platform facilitates the following relationships: ∠ Patients: patients may search for physicians in their area and consult directly with academic experts that are on the platform. Patients may also have access to new academic discoveries as they become commercially available. ∠ Physicians: physicians can connect with academic experts to seek consultations on behalf of their patients and may also provide consultations for patients in their area seeking medical expertise in that physician’s relevant specialty. Physicians will also have access to new diagnostic solutions to help improve diagnostic accuracy. ∠ Academic Experts: academic experts on the platform can make themselves available for patients or physicians seeking access to their expertise. Additionally, these experts have a platform available to commercialize their research discoveries. We intend to continue updating our platform to allow for patient-to-patient communications and allow individuals to share stories and provide support for one another, to allow physicians to consult with their peers to discuss and share challenges and solutions, and to allow academic experts to interact with others in academia on the platform to discuss their research and cross-collaborate. ICP was developed at Harvard and is licensed exclusively by us from Dana-Farber. The technology enables the detection of genetic mutations in liquid biopsies, such as blood samples. The field of liquid biopsies is a rapidly growing market, aimed at solving the challenge of obtaining genetic information on disease progression and changes from sources other than a tumor biopsy. Gene sequencing is performed on tissue biopsies taken surgically from the tumor site in order to identify potential therapies that will be more effective in treating the patient. There are several limitations to this process. First, surgical procedures have several limitations, including: ∠ Cost: surgical procedures are usually performed in a costly hospital environment. For example, according to a recent study the mean cost of lung biopsies is greater than $14,000; surgery also involves hospitalization and recovery time. ∠ Surgical access: various tumor sites are not always accessible (e.g. brain tumors), in which cases no biopsy is available for diagnosis. ∠ Risk: patient health may not permit undergoing an invasive surgery; therefore a biopsy cannot be obtained at all. ∠ Time: the process of scheduling and coordinating a surgical procedure often takes time, delaying the start of patient treatment. Second, there are several tumor-related limitations that provide a challenge to obtaining such genetic information from a tumor: ∠ Tumors are heterogeneous by nature: a tissue sample from one area of the tumor may not properly represent the tumor’s entire genetic composition; thus, the diagnostic results from a tumor may be incomplete and non-representative. ∠ Metastases: in order to accurately test a patient with metastatic disease, ideally an individual biopsy sample should be taken from each site (if those sites are even known). These biopsies are very difficult to obtain; therefore physicians often rely on biopsies taken from the primary tumor site. The advent of technologies enabling liquid biopsies as an alternative to tumor biopsy and analysis is based on the fact that tumors (both primary and metastatic) shed cells and fragments of DNA into the blood stream. These blood samples are called “liquid biopsies” that contain circulating tumor DNA, or ctDNA, which hold the same genetic information found in the tumor(s). That tumor DNA is the target of genetic analysis. However, since the quantity of tumor DNA is very small in proportion to the “normal” (or “healthy”) DNA within the blood stream, there is a need to identify and separate the tumor DNA from the normal DNA. ICP is an enrichment technology that enables the laboratory to focus its analysis on the tumor DNA by enriching, and thereby “multiplying” the presence of, tumor DNA, while maintaining the normal DNA at its same level. Once the enrichment process has been completed, the laboratory genetic testing equipment is able to identify genetic abnormalities presented in the ctDNA, and an analysis can be conducted at a higher level of sensitivity, to enable the detection of such genetic abnormalities. The technology is encapsulated into a chemical that is provided in the form of a kit and sold to other laboratories who wish to conduct these tests in-house. The chemical within the kit is added to the specimen preparation process, enriching the sample for the tumor DNA so that the analysis will detect those genetic abnormalities. Merger Transaction On June 29, 2017 , the Company (then known as “Transgenomic, Inc.”, or “Transgenomic”), completed a reverse merger (the “Merger”) with Precipio Diagnostics, LLC, a privately held Delaware limited liability company (“Precipio Diagnostics”) in accordance with the terms of the Agreement and Plan of Merger (the “Merger Agreement”), dated October 12, 2016 , as amended on February 2, 2017 and June 29, 2017, by and among Transgenomic, Precipio Diagnostics and New Haven Labs Inc. (“Merger Sub”) a wholly-owned subsidiary of Transgenomic. Pursuant to the Merger Agreement, Merger Sub merged with and into Precipio Diagnostics, with Precipio Diagnostics surviving the Merger as a wholly-owned subsidiary of the combined company (See Note 3 - Reverse Merger). In connection with the Merger, the Company changed its name from Transgenomic, Inc. to Precipio, Inc., relisted its common stock under Precipio, Inc. on the National Association of Securities Dealers Automated Quotations (“NASDAQ”), and effected a 1-for- 30 reverse stock split of its common stock . Upon the consummation of the Merger, the historical financial statements of Precipio Diagnostics become the Company's historical financial statements. Accordingly, the historical financial statements of Precipio Diagnostics are included in the comparative prior periods. As a result of the Merger, historical preferred stock, common stock, restricted units, warrants and additional paid-in capital, including share and per share amounts, have been retroactively adjusted to reflect the equity structure of the combined company, including the effect of the Merger exchange ratio. Pursuant to the Merger Agreement, each outstanding unit of Precipio Diagnostics was exchanged for 10.2502 pre-reverse stock split shares of Company Common Stock (the “Exchange Ratio”). See Note 3 - Reverse Merger for additional discussion of the Merger. Going Concern. The consolidated financial statements have been prepared using accounting principles generally accepted in the United States of America (“GAAP”) applicable for a going concern, which assume that the Company will realize its assets and discharge its liabilities in the ordinary course of business. The Company has incurred substantial operating losses and has used cash in its operating activities for the past several years. As of December 31, 2017, the Company had a net loss of $ 20.7 million , negative working capital of $8.3 million and net cash used in operating activities of $6.7 million . The Company’s ability to continue as a going concern is dependent upon a combination of achieving its business plan, including generating additional revenue, and raising additional financing to meet its debt obligations and paying liabilities arising from normal business operations when they come due. To meet its current and future obligations the Company has taken the following steps to capitalize the business and successfully achieve its business plan: · On January 8, 2018, the Company received gross proceeds of $400,000 when it entered into an agreement with the Connecticut Department of Economic and Community Development by which the Company received a grant of $100,000 and a loan of $300,000 with a payment term of ten years. · On February 8, 2018 the Company entered into an equity purchase agreement for the purchase of up to $8,000,000 of shares of the Company’s common stock from time to time, at the Company’s option. The initial sale of 721,153 shares of the Company’s common stock resulted in net proceeds to the Company of approximately $709,000 . · On February 20, 2018 Crede Capital Group LLC (“Crede ”) filed a lawsuit against the Company claiming that the Company owed Crede $2.2 million. On March 12, 2018, the Company settled with Crede for approximately $1.9 million and t he settlement allows the Company to pay the $1.9 million over a sixteen month payment plan concluding in May 2019. · On March 21, 2018, the Company entered into an agreement with investors of Series B and Series C Preferred shares and warrants to convert their respective holdings into shares of the Company’s common stock. Pursuant to the agreement, to incent such investors, the Company agreed to a conversion price for such preferred stock and an exercise price of $0.75 per share of common stock for such warrants and each investor agreed to convert its outstanding shares and exercise certain amounts of warrants. As a result of this initiative the Company has substantially restructured its equity structure, eliminating all but 47 shares of preferred stock. As of April 13, 2018, these transactions have resulted in net cash proceeds to the Company of $0.2 million . Notwithstanding the aforementioned circumstances, there remains substantial doubt about the Company’s ability to continue as a going concern. There can be no assurance that the Company will be able to successfully achieve its initiatives summarized above in order to continue as a going concern. The accompanying financial statements have been prepared assuming the Company will continue as a going concern and do not include any adjustments that might result should the Company be unable to continue as a going concern as a result of the outcome of this uncertainty. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2017 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Principles of Consolidation. The consolidated financial statements include the accounts of Precipio, Inc. and our wholly owned subsidiary. All inter-company balances and transactions have been eliminated in consolidation. Use of Estimates. The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of net sales and expenses during the reporting period. The most significant estimates and assumptions with regard to these consolidated financial statements relate to the allowance for doubtful accounts, assumptions used within the fair value of debt and equity transactions, contractual allowances and related impairments. These assumptions require considerable judgment by management. Actual results could differ from the estimates and assumptions used in preparing these consolidated financial statements. Risks and Uncertainties. Certain risks and uncertainties are inherent in our day-to-day operations and in the process of preparing our financial statements. The more significant of those risks are presented below and throughout the notes to the consolidated financial statements. The Company operates in the healthcare industry which is subject to numerous laws and regulations of federal, state and local governments. These laws and regulations include, but are not necessarily limited to, matters such as licensure, accreditation, government healthcare program participation requirements, reimbursement for patient services, and Medicare and Medicaid fraud and abuse. Government activity has increased with respect to investigations and allegations concerning possible violations of fraud and abuse statutes and regulations by healthcare providers. Violations of these laws and regulations could result in expulsion from government healthcare programs together with the imposition of significant fines and penalties, as well as significant repayments for patient services previously billed. Management believes that the Company is in compliance with fraud and abuse regulations, as well as other applicable government laws and regulations. While no material regulatory inquiries have been made, compliance with such laws and regulations can be subject to future government review and interpretation as well as regulatory actions unknown or unasserted at this time. Fair Value. Unless otherwise specified, book value approximates fair value. The common stock warrant liability is recorded at fair value. See Note 12 - Fair Value for additional information. Other Current Assets. Other current assets of $0.4 million as of December 31, 2017 include prepaid assets of $0.1 million, prepaid insurance of $0.2 million and other receivables of $0.1 million. As of December 31, 2016, other current assets consisted primarily of prepaid assets. Concentrations of Risk. From time to time, we may maintain a cash position with financial institutions in amounts that exceed Federal Deposit Insurance Corporation insured limits of up to $250,000 per depositor per financial institution. We have not experienced any losses on such accounts as of December 31, 2017. Service companies in the health care industry typically grant credit without collateral to patients. The majority of these patients are insured under third-party insurance agreements. The services provided by the Company are routinely billed utilizing the Current Procedural Terminology (CPT) code set designed to communicate uniform information about medical services and procedures among physicians, coders, patients, accreditation organizations, and payers for administrative, financial, and analytical purposes. CPT codes are currently identified by the Centers for Medicare and Medicaid Services and third-party payors. The Company utilizes CPT codes for Pathology and Laboratory Services contained within codes 80000-89398. Inventories. Inventories consist of laboratory supplies and are valued at cost (determined on an average cost basis, which approximates the first-in, first-out method) or net realizable value, whichever is lower. We evaluate inventory for items that are slow moving or obsolete and record an appropriate reserve for obsolescence if needed. We determined that no allowance for slow moving or obsolete inventory was necessary at December 31, 2017 and 2016. Property and Equipment, net. Property and equipment are carried at cost, net of accumulated depreciation and amortization. Expenditures for maintenance and repairs are expensed as incurred. Depreciation and amortization are computed by the straight-line method over the estimated useful lives of the related assets as follows: Furniture and fixtures 5 to 7 years Laboratory equipment 3 to 9 years Computer equipment and software 3 to 7 years Equipment under capital leases 5 to 10 years For assets sold or otherwise disposed of, the cost and related accumulated depreciation and amortization are removed from the accounts, and any related gain or loss is reflected in operations for the period. Expenditures for major betterments that extend the useful lives of property and equipment are capitalized. Goodwill and Intangible Assets. As a result of the Merger, the Company recorded goodwill and intangible assets as part of its allocation of the purchase consideration. See Note 3 - Reverse Merger for the amounts recorded. Goodwill Goodwill represents the excess of the purchase price over the fair value of identifiable net assets of the business acquired. See Note 3 - Reverse Merger for the amount recorded. Goodwill is tested for impairment annually. We perform this impairment analysis during the fourth quarter of each year or when a significant event occurs that may indicate that the assets might be impaired. In assessing goodwill for impairment, the Company has the option to assess qualitative factors to determine whether events or circumstances indicate that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, for which the consolidated Company is considered one reporting unit. If this is the case, then performing the quantitative goodwill impairment test is unnecessary. An entity can choose not to perform a qualitative assessment for any or all of its reporting units, and proceed directly to the use of the quantitative impairment test. In assessing qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount, the relevant events and circumstances that may impact the fair value and the carrying amount of a reporting unit are assessed. The identification of relevant events and circumstances and how these may impact a reporting unit’s fair value or carrying amount involve significant judgments by management. These judgments include the consideration of macroeconomic conditions, industry and market considerations, cost factors, overall financial performance, events which are specific to the company, and trends in the market price of our common stock. Each factor is assessed to determine whether it impacts the impairment test positively or negatively, and the magnitude of any such impact. During the year ended December 31, 2017 , the Company experienced a decline in its share price and a significant reduction in its market capitalization, as such the Company determined that an assessment of goodwill should be performed using the qualitative approach described above. Based on the qualitative assessment, the Company concluded that it was more likely than not that the fair value of the Company was less than its carry value. While there were positive qualitative factors discovered during the qualitative analysis, the instability of the market price of the Company’s common stock and the decline in revenues were significant adverse factors that directed a full assessment. As part of its analysis, the Company considered triggering events and compared its fair value with its carrying value. The analysis of the fair value of the Company involved using the market capitalization and the discounted cash flow model. Based on the analysis, the Company concluded that its carrying value exceeded its fair value and goodwill impairment in the amount of $9.3 million was recorded f or the year ended December 31, 2017. Intangibles We review our amortizable long-lived assets for impairment annually or whenever events indicate that the carrying amount of the asset (group) may not be recoverable. An impairment loss may be needed if the sum of the future undiscounted cash flows is less than the carrying amount of the asset (group). The amount of the loss would be determined by comparing the fair value of the asset to the carrying amount of the asset (group). There were no impairment charges during the year ended December 31, 2017. In-process research and development (“IPR&D”) represents the fair value assigned to research and development assets that were not fully developed at the date of the Merger. Until the IPR&D projects are completed, the assets are accounted for as indefinite-lived intangible assets and subject to impairment testing. For the year ended December 31, 2017, there was no impairment of IPR&D. Debt Issuance Costs and Debt Discounts. Debt issuance costs and debt discounts are being amortized over the lives of the related financings on a basis that approximates the effective interest method. Both are presented as a reduction of the related debt in the accompanying balance sheets. Deferred issuance costs increased by $1.8 million due to debt issuance costs and debt discounts recorded in connection with the issuance of convertible bridge notes (see Note 7 –Convertible Bridge Notes for further information). Net debt issuance costs and debt discounts were zero and $65,048 at December 31, 2017 and 2016, respectively (net of accumulated amortization of zero and $87,342 , respectively). During the year ended December 31, 2017, the convertible bridge notes were either extinguished through cash payments or converted to shares of the Company’s common stock. Upon the payments and conversions, all remaining debt discounts and debt issuance costs associated with the conversions were fully amortized to interest expense and debt discounts and debt issuance costs associated with the portion paid in cash were amortized to interest expense up through the payment date (see Note 7 – Convertible Bridge Notes for further discussion). Amortization expense was $1.9 million and $32,662 for the years ended December 31, 2017 and 2016, respectively. Stock-Based Compensation. All stock-based awards to date have exercise prices equal to the market price of our common stock on the date of grant and have ten -year contractual terms. Stock-based compensation cost is based on the fair value of the portion of stock-based awards that is ultimately expected to vest. The Company utilizes the Black-Scholes option pricing model for determining the estimated fair value for stock-based awards. Unvested awards as of December 31, 2017 had vesting periods of up to four years from the date of grant. None of the awards outstanding at December 31, 2017 are subject to performance or market-based vesting conditions. Net Sales Recognition. Revenue is realized and earned when all of the following criteria are met: ∠ Persuasive evidence of an arrangement exists; ∠ Delivery has occurred or services have been rendered; ∠ The seller’s price to the buyer is fixed or determinable; and ∠ Collectability is reasonably assured. We primarily recognize revenue for diagnostic services upon completion of the testing process. Patient diagnostic service revenue is reported at the estimated net realizable amounts from patients, third-party payors and others for services rendered, including retroactive adjustment under reimbursement agreements with third-party payors. Revenue under third-party payor agreements is subject to audit and retroactive adjustment. Provisions for third-party payor settlements are provided in the period in which the related services are rendered and adjusted in the future periods, as final settlements are determined. We also perform contract diagnostic services on a project by project basis as well as clinical research projects sponsored by federal and state agencies. When we receive payment in advance, we initially defer the revenue and recognize it when we deliver the service. These projects typically do not extend beyond one year. Deferred net sales included in the balance sheet as deferred revenue was less than $0.1 million as of December 31, 2017 and 2016. Taxes collected from customers and remitted to government agencies for specific net sales producing transactions are recorded net with no effect on the income statement. Accounts Receivable Accounts Receivable result from diagnostic services provided to self-pay and insured patients, project based testing services and clinical research. The payment for services provide by the Company are generally due within 30 days from the invoice date. Accounts receivable are reduced by an allowance for doubtful accounts. In evaluating the collectability of accounts receivable, the Company analyzes and identifies trends for each of its sources of revenue to estimate the appropriate allowance for doubtful accounts. For receivables associated with self-pay patients, including patients with insurance and a deductible and copayment, the Company records an allowance for doubtful accounts in the period of services on the basis of past experience of patients unable or unwilling to pay for service fee for which they are financially responsible. For receivables associated with services provided to patients with third-party coverage, the Company analyzes contractually due amounts and provides an allowance, if necessary. The difference between the standard rates and the amounts actually collected after all reasonable collection efforts have been exhausted is charged against the allowance for doubtful accounts. Presentation of Insurance Claims and Related Insurance Recoveries. The Company accounts for its insurance claims and related insurance recoveries at their gross values as standards for health care entities do not allow the Company to net insurance recoveries against the related claim liabilities. There were no insurance claims or insurance recoveries recorded during the years ended December 31, 2017 and 2016. Advertising Costs. Advertising costs are expensed as incurred. Advertising costs charged to operations totaled $8,300 in 2017 and $12,900 in 2016. Research and Development Costs. All costs associated with internal research and development are expensed as incurred. These costs include salaries and employee related expenses, operating supplies and facility-related expenses. Research and development costs charged to operations totaled $0.5 million and zero for the years ended December 31, 2017 and 2016, respectively. Income Taxes. In 2016, Precipio Diagnostics was organized as a limited liability company and operated under the default classification as a partnership until July 31, 2016. Effective August 1, 2016, Precipio Diagnostics elected to be treated as a corporation for tax purposes and as such, a net deferred tax asset, prior to a valuation allowance was created. The Company calculated an income tax provision for the remainder of the year. Prior to August 1, 2016, income tax expense or benefits were calculated at the members’ level. Deferred tax assets and liabilities are determined based on the differences between the financial reporting and tax basis of assets and liabilities at each balance sheet date using tax rates expected to be in effect in the year the differences are expected to reverse. The effect on the deferred tax assets and liabilities of a change in tax rates is recognized in the period when the change in tax rates is enacted. A valuation allowance is established when it is determined that it is more likely than not that some portion or all of the deferred tax assets will not be realized. A full valuation allowance has been applied against the Company’s net deferred tax assets as of December 31, 2017 and 2016, due to projected losses and because it is not more likely than not that the Company will realize future benefits associated with these deferred tax assets. Management’s conclusions regarding uncertain tax positions may be subject to review and adjustment at a later date based upon ongoing analysis of, or changes in tax laws, regulations and interpretations thereof as well as other factors. The Company’s policy is to record interest and penalties directly related to income taxes as income tax expense in the accompanying consolidated statements of operations, of which such amounts were immaterial for the years ended December 31, 2017 and 2016. Common Stock Warrants. The Company classifies the issuance of common stock warrants as equity any contracts that (i) require physical settlement or net-stock settlement or (ii) gives the Company a choice of net-cash settlement or settlement in its own stocks (physical settlement or net-stock settlement). The Company classifies as assets or liabilities any contracts that (i) require net-cash settlement (including a requirement to net-cash settle the contract if an event occurs and if that event is outside of the Company’s control), or (ii) gives the counterparty a choice of net-cash settlement or settlement in stock (physical settlement or net-stock settlement). Certain of our issued and outstanding warrants to purchase common stock do not qualify to be treated as equity and accordingly, are recorded as a liability (“Common Stock Warrant Liability”). We are required to present these instruments at fair value at each reporting date and any changes in fair values are recorded as an adjustment to earnings. Beneficial Conversion Features. The intrinsic value of a beneficial conversion feature (“BCF”) inherent to a convertible note payable, which is not bifurcated and accounted for separately from the convertible note payable and may not be settled in cash upon conversion, is treated as a discount to the convertible note payable. This discount is amortized over the period from the date of issuance to the first conversion date using the effective interest method. If the note payable is retired prior to the end of its contractual term, the unamortized discount is expensed in the period of retirement to interest expense. In general, the BCF is measured by comparing the effective conversion price, after considering the relative fair value of detachable instruments included in the financing transaction, if any, to the fair value of the common shares at the commitment date to be received upon conversion. Deemed dividends are also recorded for the intrinsic value of conversion options embedded in preferred shares based upon the differences between the fair value of the underlying common stock at the commitment date of the transaction and the effective conversion price embedded in the preferred shares. When the preferred shares are non-redeemable the BCF is fully amortized into additional paid-in capital and preferred discount. If the preferred shares are redeemable, the discount is amortized from the commitment date to the first conversion date. Loss Per Share. Basic loss per share is calculated based on the weighted-average number of common shares outstanding during each period. Diluted loss per share includes shares issuable upon exercise of outstanding stock options, warrants or conversion rights that have exercise or conversion prices below the market value of our common stock. Options, warrants and conversion rights pertaining to 9,960,890 and 2,754,593 shares of our common stock have been excluded from the computation of diluted loss per share at December 31, 2017 and 2016, respectively, because the effect is anti-dilutive due to the net loss. The following table summarizes the outstanding securities not included in the computation of diluted net loss per share: December 31, 2017 2016 Stock options 236,484 3,430 Warrants 6,197,681 1,971,058 Preferred stock 3,525,000 780,105 Convertible notes 1,725 — Total 9,960,890 2,754,593 Recent Accounting Pronouncements. In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-09, Revenue from Contracts with Customers and has subsequently issued supplemental and/or clarifying ASUs (collectively “ASC 606”). ASC 606 outlines a five-step framework that intends to clarify the principles for recognizing revenue and eliminate industry-specific guidance. In addition, ASC 606 revises current disclosure requirements in an effort to help financial statement users better understand the nature, amount, timing, and uncertainty of revenue that is recognized. ASC 606 may be applied either retrospectively to each prior reporting period presented or use the modified retrospective transition method with the cumulative effect of initial adoption recognized at the date of initial application. Assessment of the new guidance is not anticipated to result in an opening balance sheet adjustment. The Company will adopt the guidance in ASU 2017-09 as of January 1, 2018 and apply the modified retrospective approach. The Company evaluated the impact of the adoption of this new revenue recognition standard utilizing the five-step framework of ASC 606 for all services, that include laboratory testing services provided to patients and customer related laboratory service contracts encompassing biomarker testing services and clinical projects. The Company concluded that control of the laboratory testing services is transferred to the customer at a point in time. As such, the Company shall continue to recognize revenue for laboratory testing services at a point in time based on the delivery method (web-portal access or fax) for patient’s laboratory report, per the contract. The Company also evaluated customer related biomarker testing and clinical project services. The Company analyzed it’s “effort based” method of assessing performance and concluded that it can reasonable measure progress towards satisfaction of the performance obligation based upon the delivery of results. The Company concludes an adjustment will not be required and a change to its current revenue recognition process and policy to adopt the new standard is not necessary. In February 2016, the FASB issued ASU No. 2016-02, Leases . The new standard amends the recognition of lease assets and lease liabilities by lessees for those leases currently classified as operating leases and amends disclosure requirements associated with leasing arrangements. The new standard is effective for fiscal years and interim periods within those fiscal years beginning after December 15, 2018. Early adoption is permitted. The new standard must be adopted using a modified retrospective transition, and provides for certain practical expedients. Transition will require application of the new guidance at the beginning of the earliest comparative period presented. We are currently assessing the impact that the adoption of this ASU will have on our consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. The new standard simplifies several aspects related to the accounting for share-based payment transactions, including the accounting for income taxes, statutory tax withholding requirements, forfeitures and classification on the statement of cash flows. This guidance is effective for fiscal years and interim periods within those fiscal years beginning after December 15, 2016. The Company adopted ASU No. 2016-09 as of January 1, 2017. The adoption of this guidance does not have a material effect on the Company’s financial position and results of operations. In August 2016, FASB issued ASU No. 2016-15 , Classification of Certain Cash Receipts and Cash Payments . ASU No. 2016-15 eliminates the diversity in practice related to the classification of certain cash receipts and payments in the statement of cash flows by adding or clarifying guidance on eight specific cash flow issues. ASU No. 2016-15 is effective for fiscal years beginning after December 15, 2017, and for interim periods within that fiscal year. We do not believe ASU No. 2016-15 will have a material effect on our financial position and results of operations. In January 2017, FASB issued ASU No. 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business. ASU No. 2017-01 adds guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The new guidance is effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. The Company adopted the new guidance on January 1, 2018, and will apply it to all applicable transactions after the adoption date. The Company does not believe ASU No. 2017-01 will have a material effect on its financial position and results of operations. In January 2017, FASB issued ASU No. 2017-04, Intangibles — Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment, which removes Step 2 from the goodwill impairment test. It is effective for annual and interim periods beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment test performed with a measurement date after January 1, 2017. The Company has adopted this standard and, as discussed above, performed impairment testing of goodwill during the year ended December 31, 2017 which resulted in the Company recording a goodwill impairment charge of $ 9.3 million. In May 2017, the FASB issued ASU 2017-09 “ Compensation – Stock Compensation (Topic 718): Scope of Modification Accounting”, which provides clarity and reduces both diversity in practice and cost and complexity when applying guidance in Topic 718. This amendment provides guidance about which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting in Topic 718. The amendments are effective for all entities for annual periods, and interim periods within those periods, beginning after December 15, 2017. The Company does not believe ASU No. 2017-09 will have a material effect on its financial position and results of operations. In July 2017, FASB issued ASU No. 2017-11, Earning Per Share (Topic 260), Distinguishing Liabilities from Equity (Topic 480) and Derivatives and Hedging (Topic 815), which was issued in two parts, Part I, Accounting for Certain Financial Instruments with Down Round Features and Part II, Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception. Part I of ASC No. 2017-11 addresses the classification analysis of certain equity-linked financial instruments (or embedded features) with down round features. When determining whether certain financial instruments should be classified as liabilities or equity instruments, a down round feature no longer precludes equity classification when assessing whether the instrument is indexed to an entity’s own stock. The amendments also clarify existing disclosure requirements for equity-classified instruments. As a result, a freestanding equity-linked financial instrument (or embedded conversion option) no longer would be accounted for as a derivative liability at fair value as a result of the existence of a down round feature. For freestanding equity classified financial instruments, the amendments require entities that present earnings per share (EPS) in accordance with Topic 260 to recognize the effect of the down round feature when it is triggered. That effect is treated as a dividend and as a reduction of income available to common shareholders in basic EPS. The amendments in Part II of ASU 2017-11 recharacterize the indefinite deferral of certain provisions of Topic 480 that now are presented as pending content in the codification, to a scope exception. Part II amendments do not have an accounting effect. The ASU 2017-11 is effective for annual and interim periods beginning after December 15, 2018, with early adoption permitted. The Company has early adopted this standard as of January 1, 2017 with the only impact being that the warrants with down round provisions are classified within equity. (See Note 7 - Convertible Bridge Notes and Note 11 - Stockholders' Equity). |
REVERSE MERGER
REVERSE MERGER | 12 Months Ended |
Dec. 31, 2017 | |
REVERSE MERGER [Abstract] | |
REVERSE MERGER | 3. REVERSE MERGER On June 29, 2017 (the “Closing Date”), the Company completed the Merger with Precipio Diagnostics, in accordance with the terms of the Merger Agreement. On the Closing Date, the outstanding common and preferred units of Precipio Diagnostics and certain debt of Precipio Diagnostics were converted into (i ) 5,352,847 shares of Precipio common stock, together with cash in lieu of fractional units, and (ii) 802,920 shares of Precipio preferred stock with an aggregate face amount equal to $3 million . Upon the consummation of the Merger, the historical financial statements of Precipio Diagnostics became the Company’s historical financial statements. Accordingly, the historical financial statements of Precipio Diagnostics as of and for the year ended December 31, 2016 are included herein. In connection with the Merger, on the Closing Date, Precipio also issued promissory notes and shares of Precipio preferred and common stock in a number of transactions, whereby: ∠ Holders of certain secured indebtedness of Transgenomic received in exchange for such indebtedness 802,925 shares of Precipio preferred stock in an amount equal to $3.0 million stated value, and 352,630 shares of Precipio common stock; ∠ Holders of Transgenomic preferred stock converted it into 7,155 shares of Precipio common stock; and ∠ Precipio issued 107,056 shares of Precipio preferred stock to certain investors in exchange for $400,000 in a private placement. Precipio also completed the sale of an aggregate of $800,000 of promissory notes pursuant to a securities purchase agreement. Purchase Consideration The estimated purchase consideration based on the value of the equity of Transgenomic, the accounting acquiree, is as follows: (dollars in thousands) Legacy Transgenomic common stock $ 6,088 Fair value of preferred stock converted to common stock 49 Fair value of debt converted to common stock 2,398 Fair value of debt converted to preferred stock 9,796 Fair value of existing bridge notes 1,275 Fair value of warrants 1,996 Purchase consideration $ 21,602 In estimating the purchase consideration above, Transgenomic used its closing stock price of $6.80 as of the Closing Date. Transgenomic had 895,334 common shares outstanding prior to the Merger. In connection wi th the Merger, Transgenomic preferred stock converted into 7,155 shares of Precipio common stock and certain of Transgenomic debt and accrued interest converted into 352,630 shares of Precipio common stock and 802,925 shares of Precipio preferred stock, face value $3.0 million with an 8% annual divi dend. At the Closing Date, the preferred stock had a fair value of $12.20 per share. Allocation of Purchase Consideration The following table sets forth an allocation of the purchase consideration to the identifiable tangible and intangible assets of Transgenomic, the accounting acquiree, based on fair values as of the Closing Date with the excess recorded as goodwill: (dollars in thousands) Current and other assets $ 419 Property and equipment 29 Goodwill 14,000 Other intangible assets (1) 21,100 Total assets 35,548 Current liabilities 13,423 Other liabilities 523 Total liabilities 13,946 Net assets acquired $ 21,602 (1) Other intangible assets consist of: (dollars in thousands) Acquired technology $ 18,990 Customer relationships 250 Non-compete agreements 30 Trademark and trade name 40 Backlog 200 In-process research and development 1,590 Total intangibles $ 21,100 We determined the estimated fair value of the acquired technology b y using the multi-period excess earnings method of the income approach. The estimated fair value of the remaining identifiable intangible assets acquired were determined primarily by using the income approach. Unaudited pro forma information The operating results of Transgenomic for the period after the Closing Date to December 31, 2017 have b een included in the Company's consolidated financial statements as of and for the year ended December 31, 2017. The following unaudited pro forma information presents the Company's financial results as if the acquisition of Transgenomic had occurred on January 1, 2016: Dollars in thousands, except per share amounts For the Years ended December 31, 2017 2016 Net sales $ 2,687 $ 3,280 Net loss available to common stockholders (37,389 ) (11,215 ) Loss per common share $ (4.95 ) $ (1.70 ) |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 12 Months Ended |
Dec. 31, 2017 | |
PROPERTY AND EQUIPMENT [Abstract] | |
PROPERTY AND EQUIPMENT | 4. PROPERTY AND EQUIPMENT A summary of property and equipment at December 31, 2017 and 2016 is as follows: 2017 2016 Furniture and fixtures $ 9 $ 9 Laboratory equipment 181 153 Computer equipment and software 307 275 Equipment under capital leases 296 296 Construction in process 115 — 908 733 Less—accumulated depreciation and amortization (555 ) (453 ) Total $ 353 $ 280 Depreciation expense was approximately $0.1 million for both the years ended December 31, 2017 and 2016. Depreciation expense during each year includes depreciation related to equipment acquired under capital leases. |
INTANGIBLES
INTANGIBLES | 12 Months Ended |
Dec. 31, 2017 | |
INTANGIBLES [Abstract] | |
INTANGIBLES | 5 . INTANGIBLES We had no intangible assets as of December 31, 2016. In conjunction with the Merger, we recorded intangible assets of $21.1 million . As of December 31, 2017 our intangible assets consisted of the following: Dollars in Thousands December 31, 2017 Cost Accumulated Amortization Net Book Value Technology $ 18,990 $ 475 $ 18,515 Customer relationships 250 42 208 Backlog 200 100 100 Covenants not to compete 30 15 15 Trademark 40 10 30 IPR&D 1,590 — 1,590 $ 21,100 $ 642 $ 20,458 Estimated Useful Life Technology 20 years Customer relationships 3 years Backlog 1 year Covenants not to compete 1 year Trademark 2 years Until our in-process research and development projects are completed, the assets are accounted for as indefinite-lived intangible assets and subject to impairment testing. For the year ended December 31, 2017, there was no impairment of IPR&D. Amortization expense for intangible assets was $0.6 million during the year ended December 31, 2017. Amortization expense for intangible assets is expected to be $1.2 million, $1.0 million, $1.0 million, $0.9 million and $0.9 million for each of the years ending December 31, 2018, 2019, 2020, 2021 and 2022, respectively. |
LONG-TERM DEBT
LONG-TERM DEBT | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
LONG-TERM DEBT | 6 . LONG-TERM DEBT Long-term debt consists of the following: Dollars in Thousands December 31, 2017 December 31, 2016 Senior Notes $ — $ 3,270 Senior Note debt issuance costs — (9 ) Junior Notes — 584 Connecticut Innovations - line of credit — 162 Department of Economic and Community Development (DECD) — 243 DECD debt issuance costs — (30 ) Webster Bank — 328 Webster Bank debt discounts and issuance costs — (26 ) Secured debt obligations 3,233 — Financed insurance loan 183 — Total long-term debt 3,416 4,522 Current portion of long-term debt (587 ) (395 ) Long-term debt, net of current maturities $ 2,829 $ 4,127 Senior and Junior Notes During 2016, the Company raised $525,000 from members through the issuance of senior notes which accrue interest at a rate of 12% and were payable at the sooner of the closing of a qualified public offering, as outlined in the note agreement, or five years from date of issuance. Also during 2016, the Company restructured equity through a redemption and exchange agreement by exchanging Member Equity comprised of Series A and Series B Convertible Preferred Units in the amount of $2,147,716 (members’ initial investment of $1,715,000 , plus declared dividends on these preferred units of $432,716 ), and Convertible Bridge Notes of $1,120,000 , plus accrued interest of $61,073 for new senior notes of $2,744,968 (“Senior Notes ”) and new junior notes of $583,821 (“Junior Notes”). The Senior and Junior Notes accrue d interest at a rate of 12% and 15% , respectively, and ha d maturity dates ranging from March 2021 to September 2021, or earlier based on certain qualifying events as outlined in the note agreements . During the year ended December 31, 2017, prior to the Merger, the Company raised $315,000 from members through the issuance of Senior Notes at a rate of 12% interest that were payable at the sooner of the closin g of a qualified public offering, as outlined in the note agreement, or five years from date of issuance. On the Closing Date of the Merger, the outstanding balance of $3,584,968 in Senior Notes and $583,821 in Junior Notes, plus accrued interest of $602,373 , were converted into 802,920 shares of Precipio preferred stock and 1,414,700 shares of Precipio common stock. There were no Senior or Junior Notes outstanding a t December 31, 2017. As of December 31, 2016, the outstanding balance of Senior and Junior Notes was $3,269,968 and $583,821 , respectively, with accrued interest included within the accrued expenses on the accompanying consolidated balance sheet of $279,740 and $71,258 , respectively . Connecticut Innovations, Incorporated The Company entered into a line of credit on April 1, 2012 with Connecticut Innovations, Incorporated (Connecticut Innovations), an entity affiliated with a director of the Company, for up to $500,000 with interest paid monthly at 8% , due on September 1, 2018. Principal and interest payments began February 1, 2013 and ranged from $7,436 to $12,206 until September 2016, when the Company entered into a forbearance agreement to 1) defer monthly principal payments until October 2017 and 2) make interest-only payments totaling $1,041 per month through October 2017. Pursuant to the forbearance agreement, the Company was also restricted from any additional borrowings under the line of credit. The line was secured by substantially all of the Company’s assets. In connection with the Merger, the Company paid in full its loan obligations with Connecticut Innovations. The outstanding balance was zero and $162,066 as of December 31, 2017 and 2016, respectively. Department of Economic and Community Development. The Company entered into a 10 -year term loan with the Department of Economic and Community Development (“DECD”) on May 1, 2013 for $300,000 , with interest paid monthly at 3% , due on April 23, 2023 . The loan was secured by substantially all of the Company’s assets but was subordinate to the term loan with Webster Bank and the Connecticut Innovations line of credit. In connection with the Merger, the Company paid in full its loan obligations with DECD. The outstanding balance was zero and $243,287 as of December 31, 2017 and 2016, respectively. The outstanding principal and accrued interest balance paid in full in July 2017 was $225,714 . Webster Bank. The Company entered into a 3.5 -year term loan with Webster Bank on December 1, 2014 for $500,000 , with interest paid monthly at the one month LIBOR rate ( 1.16% at June 30, 2017) plus 500 basis points, due on May 31, 2018. The line was secured by substantially all of the Company’s assets and had first priority over all other outstanding debt. The term loan with Webster Bank was subject to financial covenants relating to maintaining adequate cash runway, as defined in the term loan agreement. As of December 31, 2016 the Company was not in compliance with these covenants and, as such, the Webster Bank debt has all been presented as current in the accompanying consolidated financial statements. On June 29, 2017, the closing date of the Merger, the Company paid in full its loan obligations (including principal and interest) with Webster Bank. The outstanding balance was zero and $328,000 as of December 31 , 2017 and 2016, respectively. During the year ended December 31, 2017, the Company incurred a loss on extinguishment of debt in the approximate amount of $53,000 , related to the extinguishment of the Connecticut Innovations, DECD and Webster Bank loans. Secured Debt Obligations In the fourth quarter of 2017, the Company entered into Debt Settlement Agreements (the “Settlement Agreements”) with certain of its accounts payable and accrued liability vendors (the “Creditors”) pursuant to which the Creditors , who were owed $6.3 million (the “Debt Obligations”) by the Company, agreed to reduce and exchange the Debt Obligations for a secured obligation in the amount of $3.2 million, $1.9 million in shares of the Company’s common stock and warrants, with a fair value of approximately $0.2 million, to purchase shares of the Company’s common stock. As a result of the Settlement Agreements, the Company recorded a gain on troubled debt restructuring of $1.2 million and a loss on extinguishment of liability of $0.2 million. The Debt Obligations were restructured as follows: · The Company entered into a scheduled long-term debt repayment agreement of approximately $3.2 million, which includes interest of approximately $0.6 million, to be paid in forty-eight equal monthly installments beginning in July 2018 (the “Secured Debt Obligations”). · Debt Obligations of $1.9 million were canceled in exchange for 1,814,754 shares of the Company’s common stock with a weighted average price per share of $1.04 (the “Settlement Common Shares”). The stock was issued in February 2018. · Warrants to purchase 108,112 shares of the Company’s common stock at an exercise price of $7.50 per share (the “Creditor Warrants”) were issued to certain Creditors. The Creditor Warrants were issued in February 2018 and had a fair value of approximately $0.2 million at the date of the Settlement Agreements. The Company also entered into a Security Agreement (the “Security Agreement”), dated October 31, 2017, with a collateral agent for the Creditors, pursuant to which the Company granted to the collateral agent, for the benefit of the Creditors, a security interest in certain property of the Company to secure its obligations under the Settlement Agreements. Accounting for Settlement Agreements – Troubled debt The Settlement Agreements for certain of the Creditors were accounted for as troubled debt restructurings as the Creditors had granted concessions to the Company. Of the $6.3 million in Debt Obligations, the accounts payable and accrued liability balances related to the troubled debt restructurings totaled $5.2 million at the time of the Settlement Agreements. During the year ended December 31, 2017, the Company recorded a gain on settlement of troubled debt restructuring of approximately $1.2 million which is included in gain on troubled debt restructuring in the consolidated statements of operations. The $1.2 million gain represents the carrying amount of the liability due to the Creditors in excess of the undiscounted future cash flows. In connection with the accounting for these troubled debt restructurings the Company recorded a liability of $3.2 million which represents the undiscounted future cash flows. As such, the Company will not record interest in the amount of $0.6 million on the Secured Debt Obligations in the future. The full amount of the undiscounted future cash flow of the Secured Debt Obligations of approximately $3.2 million includes interest of 10% accrued up to the first payment, plus interest over the forty-eight months, resulting in an estimated monthly payment by the Company to the Creditors of approximately $65,000 per month beginning in July 2018. At December 31 , 2017, the $3.2 million of Secured Debt Obligations is included in long-term debt in the Company’s consolidated balance sheet. In connection with the Settlement Agreements, the Company agreed to issue, to certain of the Creditors whose settlements were treated as troubled debt restructurings , Creditor Warrants to purchase 108,112 shares of the Company’s common stock at an exercise price of $7.50 per share . The Creditor Warrants were issued on February 9, 2018 and are exercisable on the date of issuance and will expire five years from the date of issuance. See Note 11 – Stockholders’ Equity (Deficit). The Company concluded that the Creditor Warrants will be classified as equity. At December 31, 2017, the Company reviewed its obligation to issue Creditor Warrants in the future and concluded that the Creditor Warrants will be treated as issued for accounting purposes on the date of the Settlement Agreements. The fair value of the Creditor Warrants, as determined by a Black-Scholes calculation, was approximately $158,000 on the date of the Settlement Agreements and was recorded as additional paid-in capital. Subsequent changes in the fair value will not be recognized as long as the warrants continue to be equity classified. On February 12, 2018, the Company issued 1,814,754 Settlement Common Shares with a fair value of approximately $1.9 million. As the Settlement Common Shares were not yet issued as of December 31, 2017, the Company considered the appropriate treatment of its obligation to issue common shares and concluded that the Settlement Common Shares will be measured at fair value on the date of the Settlement Agreements. Accordingly, the Company recorded a liability of $1.9 million as of the date of the Settlement Agreements. The Company has a $1.9 million liability included in other current liabilities in the accompanying consolidate d balance sheet as of December 31, 2017. The transaction for the Secured Debt Obligations exchanged for Settlement Common Shares was treated as an obligation to issue shares and represented a fixed dollar liability, in the amount of $1.9 million, being settled with a variable number of shares that equal the fixed dollar amount. Accordingly, the Company recorded a liability on the Settlement Agreement date equal to the fair value of the shares issued in February 2018. See Note 11 – Stockholders’ Equity (Deficit). Of the $1.9 million of debt canceled in exchange for common shares, $0.6 million was related to Creditors accounted for as troubled debt restructurings and $1.3 million was related Creditors treated as extinguishments as discussed below. Accounting for Settlement Agreements – Extinguishment of liability For Creditors where the settlement was not treated as a troubled debt restructuring, the accounting was treated as an extinguishment. The accounts payable and accrued liability balances related to the extinguishments totaled $1.1 million at the time of the Settlement Agreements. For these settlements, the Company recorded a net loss during the year ended December 31, 2017 of approximately $0.2 million equal to the difference between the carrying amount of the liability due to the Creditors and the fair value of the consideration transferred to the Creditors. The loss of $0.2 million is included in net gain on settlement of liability in the consolidated statements of operations. Convertible Promissory Notes. The Company, as part of the merger, assumed an Unsecured Convertible Promissory Note (the “Note”) with an accredited investor (the “Investor”) in the aggregate principal amount of $125,000 and interest accrues at a rate of 6% per year. The Note provided that two-thirds of the outstanding principal amount of the Note was due upon the earlier to occur of the close of the Merger or June 17, 2017 (such applicable date, the “Maturity Date”). The remaining one-third of the principal amount outstanding on the Note was to be paid on the six month anniversary of the Maturity Date. On the Maturity Date, the then outstanding aggregate amount owed on the Note of $143,041 ( $125,000 in principal amount and $18,041 of accrued interest) became due. Pursuant to the terms of the Note, the Company’s failure to pay any principal or interest within 10 days of the date such payment is due will constitute an event of default (the “Prospective Event of Default”). On June 21, 2017, the Investor agreed to waive the Prospective Event of Default and agreed to further extend the Maturity Date of the Note pursuant to a side letter to the Note (the “Side Letter”). The Side Letter provides that two-thirds of the outstanding principal amount of the Note must be paid upon the earlier to occur of (1) the closing of a public offering by the Company of either common stock, convertible preferred stock or convertible preferred notes or (2) August 16, 2017 (such applicable date, the “Deferred Maturity Date”). On August 31, 2017, the Company made payment of $83,333 , two-thirds of the then outstanding principal amount, which was more than 10 days after the Deferred Maturity Date and constituted an event of default under the terms of the Note (the “Deferred Maturity Date Event of Default”). The Investor agreed to waive the Deferred Maturity Date Event of Default. In consideration of this waiver, the Company issued the Investor one warrant to purchase 10,000 shares of the Company’s common stock, par value $0.01 per share (the “Convertible Promissory Note Warrants”). See Note 11 – Stockholders’ Equity (Deficit). The issuance date of the Convertible Promissory Note Warrants was October 3, 2017. The remaining one-third of the principal amount outstanding on the Note must be paid on the six month anniversary of the Deferred Maturity Date (the “Extended Maturity Date”). All accrued and unpaid interest on the outstanding principal amount of the Note will be due and immediately payable on the Extended Maturity Date, unless the Note is converted in which case such interest will be payable in shares of the Company’s common stock as part of the conversion. As of October 31, 2017, the outstanding principal amount due was $41,666 and accrued interest was approximately $20,000 . The Investor entered into a Settlement Agreement, as described above, through which the amount due to the Investor would be settled with Settlement Common Shares. As of December 31, 2017, the $41,666 due to the Investor is included in the Settlement Common Shares liability discussed above . Financed Insurance Loan . During the year ended December 31, 2017, t he Company financed certain of its insurance premiums (the “ Financed Insurance Loan ”) . The original amount financed in July 2017 was $0.4 million with a 4.99 % interest rate. The Company will make monthly payments through May 2018. As of December 31, 2017, the Financed Insurance Loan outstanding balance of $0.2 million is included in current maturities of long-term debt in the Company’s consolidated balance sheet and a corresponding prepaid asset of $0.2 million is included in other current assets. The aggregate future maturities required on long-term debt at December 31, 2017 are as follows: 2018 2019 2020 2021 2022 Total Secured Debt Obligations $ 404 $ 809 $ 808 $ 808 $ 404 $ 3,233 Financed Insurance Loan 183 — — — — 183 $ 587 $ 809 $ 808 $ 808 $ 404 $ 3,416 |
CONVERTIBLE BRIDGE NOTES
CONVERTIBLE BRIDGE NOTES | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
CONVERTIBLE BRIDGE NOTES | 7 . CONVERTIBLE BRIDGE NOTES. Convertible Bridge Notes. During the year ended December 31, 2016, the Company had outstanding $695,000 of unsecured convertible bridge notes. The notes accrued interest at a rate of 14% and were payable on the extended maturity date of December 31, 2016. During January 2017, the holders of the convertible bridge notes agreed to waive the maturity date of December 31, 2016 and change it to payable on demand and accrue interest until paid. The convertible bridge notes had conversion terms of (i) convertible into Series C Preferred Units of the Company (at a 30% discount) upon a Qualified Series C Financing (as defined in the note agreement), (ii) at the option of the holders of a majority of the then-outstanding principal amount of the notes, convertible into Series C Preferred Units of the Company (at a 30% discount) upon any other Series C Financing, or (iii) if no such Qualified Series C Financing occurs, or no such optional conversion takes place by the maturity date (as hereinafter defined), the convertible notes will be fully repaid by Company or the notes and accrued and unpaid interest shall convert into Preferred Series B Units (at a 30% discount) of the Preferred Series B conversion Price as defined in the operating agreement provided that notice is given to the Company at least one day prior to maturity. In the event a Deemed Liquidity Event (merger, sale, IPO, or transaction with exchange of 50% or more of voting power) the holders of the notes at their sole discretion can (a) require the Company to pay an amount equal to two times the principal and accrued and unpaid interest or (b) convert all unpaid principal and interest at a rate of 70% of the applicable security. These notes were subordinated to Connecticut Innovations, DECD and Webster Bank. In connection with the Merger, on the Closing Date, convertible bridge notes of $695,000 , plus $192,000 of accrued interest, were converted into 155,639 shares of Precipio common stock. 2017 New Bridge Notes I. Prior to the Merger, the Company (then Transgenomic) completed the sale of an aggregate of $1.2 million of non-convertible promissory notes (the “2017 Bridge Notes”) in a bridge financing pursuant to a securities purchase agreement (the “Purchase Agreement”), for which $561,500 was then given to Precipio Diagnostics through the issuance of a promissory note and is eliminated in consolidation. The financing was intended to help facilitate the completion of the Merger. The 2017 Bridge Notes had an annual interest rate of 4% and a 90 -day maturity. The 2017 Bridge Notes could be repaid by the Company at any time in cash upon payment of a 20% premium. In connection with the issuance of the 2017 Bridge Notes, the Company issued warrants (the “2017 Bridge Warrants”) to acquire 40,000 shares of the Company's common stock at an exercise price of $15.00 per share, subject to anti-dilution protection. The Purchase Agreement provides certain piggyback registration rights for the holders of the 2017 Bridge Warrants for a period of six months after the closing of the bridge financing. Aegis Capital Corp. (“Aegis”) acted as placement agent for the bridge financing and received a placement agent fee of $84,000 and warrants (the “Aegis Warrants”) to acquire 5,600 shares of the Company's common stock at an exercise price of $15.00 per share. The Aegis Warrants are identical to the 2017 Bridge Warrants except that the Aegis Warrants do not have anti-dilution protection. At the time of the Merger, the 2017 Bridge Notes were extinguished and replaced with convertible promissory notes (the “2017 New Bridge Notes I”) with an original principal amount of $1.2 million in the aggregate pursuant to an Exchange Agreement (the “Exchange Agreement”) entered into on the Closing Date. The 2017 New Bridge Notes I had an annual interest rate of 8.0% and were due and payable upon the earlier to occur of (i) October 1, 2017 or (ii) the closing of a Qualified Offering (as defined in the 2017 New Bridge Notes I). The 2017 New Bridge Notes I were convertible into shares of our common stock at an initial conversion price of $3.736329 per share, subject to adjustment, and could be convertible into shares of our preferred stock at the holder’s option if the Company did not complete a Qualified Offering (as defined in the 2017 New Bridge Notes I) by October 1, 2017. The Company could redeem the 2017 New Bridge Notes I at any time in cash upon payment of a 20% premium, or $240,000 . As the convertible promissory notes were convertible into the Company's common stock at a conversion rate lower than the fair market value of the common stock at the time of issuance, the Company recorded $989,000 as a beneficial conversion feature, which was recorded as a debt discount in the balance sheet. The discount was amortized using the effective interest method through the first conversion date of the 2017 New Bridge Notes I. On August 28, 2017, these 2017 New Bridge Notes I were partially converted into the Company’s common stock and the remaining were paid off, refer below for further discussion. Pursuant to the Exchange Agreement, the 2017 Bridge Warrants were canceled and replaced with new warrants to acquire 45,600 shares of our common stock (the “2017 New Bridge Warrants”). The initial exercise price of the 2017 New Bridge Warrants was $7.50 (subject to adjustments). If the Company completed a Qualified Offering (as defined in the 2017 New Bridge warrants), the exercise price of the 2017 New Bridge Warrants would become the lower of (i) $7.50 , or (ii) 110% of the per share offering price in the Qualified Offering, but in no event lower than $1.50 per share, which has been considered a down round provision. At issuance, the 2017 New Bridge Warrants had a fair value of $211,000 and were recorded as a debt discount to the related 2017 New Bridge Notes I, with the corresponding entry to additional paid in capital as the warrants were considered classified as equity in accordance with GAAP. As discussed in Note 2 of the accompanying consolidated financial statements, the Company early adopted ASU 2017-11, which allowed the Company to treat the warrants as equity classified, despite the down round provision. 2017 New Bridge Note II. In connection with the Merger, on the Closing Date and pursuant to a Securities Purchase Agreement (the “Bridge Purchase Agreement”), the Company completed the sale of an aggregate of $800,000 of a convertible promissory note (the “2017 New Bridge Note II”). The Company received net proceeds of $721,000 from the sale of the 2017 New Bridge Note II, which would be used for working capital purposes. The 2017 New Bridge Note II had an annual interest rate of 8.0% and was due and payable upon the earlier to occur of (i) October 1, 2017 or (ii) the closing of a Qualified Offering (as defined in the 2017 New Bridge Note II). The 2017 New Bridge Note II was convertible into shares of our common stock at an initial conversion price of $3.736329 per share, subject to adjustment, and could be convertible into shares of our preferred stock at the holder’s option if the Company does not complete a Qualified Offering (as defined in the 2017 New Bridge Note II) by October 1, 2017. The Company could redeem the 2017 New Bridge Note II at any time in cash upon payment of a 20% premium, or $160,000 . As the 2017 New Bridge Note II was convertible into the Company's common stock at a conversion rate lower than the fair market value of the common stock at the time of issuance, the Company recorded $656,000 as a beneficial conversion feature, which was recorded as a debt discount in the accompanying balance sheet. The discount was amortized using the effective interest method through the first conversion date of the 2017 New Bridge Note II. On August 28, 2017, this 2017 New Bridge Note II was partially converted into the Company’s common stock and the remaining was paid off, refer below for further discussion. In connection with the bridge financing and the assumption of certain obligations by an entity controlled by Mark Rimer (a director of the Company), the Company issued to that entity warrants (the “Side Warrants”) to purchase an aggregate of 91,429 shares of the Company's common stock . See Note 11 – Stockholders’ Equity (Deficit) for a discussion on terms of the Side Warrants. In addition, the agreement stipulated that if t he Company were to consummat e one or more rounds of equity financing following July 1, 2017, with aggregate gross proceeds of at least $7 million, the Company would be required to use a portion of the proceeds from such financing to repay the principal amount of the 2017 New Bridge Notes, together with any premium and interest. See discussion below regarding payment and conversion of the 2017 notes. Conversion and Payment of the 2017 New Bridge Notes I and New Bridge Note II (collectively, the “New Bridge Notes”). On August 28, 2017, the Company completed an underwritten public offering (the “August 2017 Offering”) of 6,000 units consisting of one share of the Company’s Series B Preferred Stock and one warrant to purchase up to 400 shares of the Company's common stock at a combined public offering price of $1,000 per unit for gross proceeds of $6.0 million (see Note 1 1 - Stockholders' Equity (Deficit)). At the time of the closing of the August 2017 Offering, the aggregate amount due to the holders of the New Bridge Notes was $2,436,551 ( $2,000,000 in principal, $400,000 for a 20% redemption premium and $36,551 in accrued interest). Upon the closing of the August 2017 Offering, the Company made a cash payment of $1,536,551 to extinguish certain notes and the remaining $900,000 of the Company’s New Bridge Notes were converted into an aggregate of 359,999 shares of the Company's common stock (the “Note Conversion Shares”) at a conversion price of $2.50 per share and 359,999 warrants to purchase the Company's common stock (the “Note Conversion Warrants”). The Company issued the Note Conversion Warrants to the holders of the New Bridge Notes as consideration for their election to convert their New Bridge Notes into shares of the Company's common stock. The Company treated the $900,000 debt conversion as an induced conversion and determined that the fair value of the consideration given in the conversion exceeded the fair value of the debt pursuant to its original conversion terms by approximately $1.0 million. This amount was recorded as an expense included in loss on extinguishment of debt and induced conversion of convertible bridge notes in our consolidated statements of operations. The Company also recorded a loss on extinguishment of debt of approximately $0.4 million related to the extinguishment of the $1,536,551 portion paid in cash, which was also recorded as an expense within the loss on extinguishment of debt and induced conversion of convertible bridge notes line in our consolidated statements of operations. See Note 1 1 Stockholders’ Equity (Deficit) for discussion of the Note Conversion Warrants . Upon conversion and payment of the New Bridge Notes, all remaining debt discounts and debt issuance costs associated with the conversions were fully amortized to interest expense and debt discounts and debt issuance costs associated with the portion paid in cash were amortized to interest expense up through the payment date. During the year ended December 31, 2017, debt discounts and debt issuance costs amortized to interest expense were $1.9 million. As of December 31, 2017, the outstanding convertible bridge notes balance was zero . |
ACCRUED EXPENSES
ACCRUED EXPENSES | 12 Months Ended |
Dec. 31, 2017 | |
Payables and Accruals [Abstract] | |
ACCRUED EXPENSES | 8 . ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES . Accrued expenses at December 31, 2017 and 2016 are as follows: 0 2017 2016 Accrued expenses $ 1,122 $ 50 Accrued compensation 126 155 Accrued interest — 495 $ 1,248 $ 700 During the year ended December 31, 2017, the Company was able to reduce approximately $1.1 million of certain accrued expense and accounts payable amounts through negotiations with certain vendors to settle pre-Merger liabilities. The Company recorded a gain of $1.1 million which is included in gain on settlement of liability, net in the consolidated statements of operations. Other current liabilities at December 31, 2017 and 2016 are as follows: 0 2017 2016 Obligation to issue common shares $ 1,897 $ — Liability for settlement of equity instrument 1,085 — $ 2,982 $ — As of December 31, 2017, t he Company has recorded a liability related to its obligation to issue shares of its common stock in the future. On February 12, 2018, the Company issued 1,814,754 Settlement Common Shares with a fair value of approximately $1.9 million. See Note 6 – Long-Term Debt for additional information. On February 20, 2018, Crede Capital Group LLC (“Crede”) filed a lawsuit against the Company in the Supreme Court of the State of New York for Summary Judgment in Lieu of Complaint requiring the Company to pay cash owed to Crede. Crede claim ed that Precipio ha d breached a Securities Purchase Agreement and Warrant that Crede entered into in connection with an investment in Transgenomic and that pursuant to those agreements, Precipio owe d Crede approximately $2.2 million. On March 12, 2018, Precipio entered into a settlement agreement (the “ Crede Agreement”) with Crede pursuant to which Precipio agreed to pay Crede a total sum of $1.925 million over a period of 16 months payable in cash , or at the Company’s discretion, in stock, in accordance with terms contained in the Crede Agreement. As a result of the Crede Agreement, as of December 31, 2017, the Company has recorded a liability of $1.1 million included in other current liabilities on the accompanying consolidated balance sheets, as well as a liability of $0.8 million included in common stock warrant liability on the accompanying consolidated balance sheets related to warrants classified as liabilities that Crede is the holder of. See Note 12 – Fair Value for additional information . During the year ended December 31, 2017, the Company recorded a loss on settlement of equity instruments of approximately $0.6 million related to the Crede Agreement. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | 9 . COMMITMENTS AND CONTINGENCIES O PERATING L EASES The Company entered into a sixty month operating lease beginning in January 2017 , for its facility in New Haven, Connecticut at a monthly rental rate of $13,400 to $14,600 and a sixty -one month operating lease beginning in May 2017 , for its facility in Omaha, Nebraska at a monthly rental rate of $2,300 to $2,800 . The future minimum annual lease payments under these operating leases at December 31, 2017 are as follows: Years Ending December 31, 2018 $ 195,000 2019 198,000 2020 203,000 2021 208,000 2022 13,000 Total $ 817,000 The Company recognizes rent expense on a straight-line basis for all operating leases. Rent expense was $0.2 million and $0.1 million for the years ended December 31, 2017 and 2016, respectively. C APITAL L EASES The Company has entered into various capital lease agreements to obtain lab equipment. The terms of the capital leases range from five to ten years with interest rates of 7.25% . A n analysis of the property acquired under capital leases at December 31, 2017 and 2016 is as follows . Classes of Property: 2017 2016 Lab equipment $ 296,000 $ 296,000 Less accumulated amortization (150,000 ) (102,000) $ 146,000 $ 194,000 Included in cost of diagnostic services is amortization expense related to equipment acquired under capital leases of approximately $48,000 and $45,000 for the years ended December 31, 2017 and 2016 respectively . The following is a schedule by years of future minimum lease payments under capital leases together with the present value of the net minimum lease payments. 8 Years Ending December 31, 2018 $ 60,000 2019 60,000 2020 36,000 2021 24,000 2022 4,000 Total capital lease obligations 184,000 Less: Amount representing interest (21,000 ) Present value of net minimum lease obligations 163,000 Less, current maturities of capital leases (50,000 ) Capital Leases, long term $ 113,000 P URCHASE C OMMITMENTS The Company has entered into purchase commitments for reagents from suppliers. These agreements started in 2011 and run through 2022. The Company and the suppliers will true up the amounts on an annual basis. The future minimum purchase commitments under these agreements are as follows: Years ending December 31, 2018 $ 209,000 2019 208,000 2020 138,000 2021 99,000 2022 10,000 OTHER CONTRACTUAL COMMITTMENTS The Company has a $1.925 million contractual commitment with Crede as a result of a settlement agreement the Company reached with Crede on March 12, 2018. See Note 8 – Accrued Expenses And Other Current Liabilities for details on the settlement. The following is a schedule by years of future contractual payments under the settlement : Years Ending December 31, 2018 $ 1,000,000 2019 925,000 Total $ 1,925,000 L ITIGATIONS The Company is delinquent on the payment of outstanding accounts payable for certain vendors and suppliers who have taken or have threatened to take legal action to collect such outstanding amounts. On February 25, 2016, the Board of Regents of the University of Nebraska (“UNMC”) filed a lawsuit against Transgenomic in the District Court of Douglas County, Nebraska, for breach of contract and seeking recovery of $0.7 million owed by us to UNMC. A $0.4 million liability was recorded and is reflected in accrued expenses at December 31, 2016. We and UNMC entered into a settlement agreement dated February 6, 2017, which included, among other things, a mutual general release of claims, and our agreement to pay $0.4 million to UNMC in installments over a period of time. On September 8, 2017, we and UNMC entered into a First Amendment to the Settlement Agreement with quarterly payments in the amount of $25,000 due commencing on September 15, 2017 and ending on June 15, 2020 and a final payment of $100,000 due on or before September 15, 2020. We made settlement payments totaling of $50,000 during 2017 and a $0.3 million liability has been recorded and is reflected in accounts payable within the accompanying consolidated balance sheet at December 31, 2017. On April 13, 2016, Fox Chase Cancer Center (“Fox Chase”) filed a lawsuit against us in the Court of Common Pleas of Philadelphia County, First Judicial District of Pennsylvania Civil Trial Division (the “Court of Common Pleas”), alleging, among other things, breach of contract, tortious interference with present and prospective contractual relations, unjust enrichment, fraudulent conversion and conspiracy and seeking punitive damages in addition to damages and other relief. This lawsuit relates to a license agreement Transgenomic entered into with Fox Chase in August 2000, as amended (the “License Agreement”), as well as the assignment of certain of Transgenomic's rights under the License Agreement to Integrated DNA Technologies, Inc. (“IDT”) pursuant to the Surveyor Kit Patent, Technology and Inventory Purchase Agreement Transgenomic entered into with IDT effective as of July 1, 2014 (the “IDT Agreement”). Pursuant to the terms of the IDT Agreement, Transgenomic agreed to indemnify IDT with respect to certain of the claims asserted in the Fox Chase proceeding. On July 8, 2016, the Court of Common Pleas sustained Transgenomic’s preliminary objections to several of Fox Chase’s claims and dismissed the claims for tortious interference, fraudulent conversion, conspiracy, punitive damages and attorney’s fees. Accordingly, the case was narrowed so that only certain contract claims and an unjust enrichment claim remained pending against Transgenomic. During June 2017, prior to the Merger, Transgenomic entered into a settlement agreement with Fox Chase (the “Agreement”) to pay $175,000 in three installments. In August 2017 we made two payments, each in the amount of $60,000 and on October 3, 2017, we made a third and final payment in the amount of $55,000 . The three payments total $175,000 which resolved all outstanding claims in the litigation brought in April 2016 by Fox Chase against Transgenomic in the Court of Common Pleas of Philadelphia County (the “Action”). As of April 13, 2018, the case remains pending with the Court as Fox Chase has not caused the Action to be formally dismissed with prejudice as it is obligated per the agreement. Also, on July 13, 2017 we entered into an agreement with its co-Defendant, IDT, regarding our indemnity obligations to IDT for legal fees and expenses incurred in the Action pursuant to the terms of the IDT Agreement in the amount of $139,000 . During 2017, we made total payments to IDT in the amount of $139,000 satisfying the agreement. As of December 31, 2017 there are no outstanding amounts owed by us and we have no liabilities recorded within the accompanying consolidated balance sheet related to this matter. On June 23, 2016, the Icahn School of Medicine at Mount Sinai (“Mount Sinai”) filed a lawsuit against Transgenomic in the Supreme Court of the State of New York, County of New York, alleging, among other things, breach of contract and, alternatively, unjust enrichment and quantum merit, and seeking recovery of $0.7 million owed by us to Mount Sinai for services rendered. We and Mount Sinai entered into a settlement agreement dated October 27, 2016, which included, among other things, a mutual general release of claims, and our agreement to pay approximately $0.7 million to Mount Sinai in installments over a period of time. Effective as of October 31, 2017, we and Mount Sinai agreed to enter into a new settlement agreement to restructure these liabilities into a secured, long-term debt obligation of $0.5 million which includes accrued interest at 10% with monthly principal and interest payments of $9,472 beginning in July 2018 and con tinuing over 48 months and to issue warrants in the amount of 24,900 shares, that are exercisable for shares of our common stock, on a 1-for-1 basis, with an exercise price of $7.50 per share, exercisable on the date of issuance with a term of 5 years. We do not plan to apply to list the warrants on the NASDAQ Capital Market, any other national securities exchange or any other nationally recognized trading system. A $0.5 million liability has been recorded and is reflected in long-term debt within the accompanying consolidated balance sheet at December 31, 2017. On December 19, 2016, Todd Smith (“Smith”) filed a lawsuit against us in the District Court of Douglas County Nebraska, alleging breach of contract and seeking recovery of $2.2 million owed by us to Smith for costs and damages arising from a breach of our obligations pursuant to a lease agreement between the parties. On April 7, 2017, we entered into a settlement agreement with Smith related to the early termination of our lease for a facility in Omaha, Nebraska. The agreement included, among other things, a mutual general release of claims, and our agreement to pay approximately $0.6 million to Smith in installments through October 2018. During the year ended December 31, 2017, we made payments totaling $0.4 million and a $0.2 million liability has been recorded and is reflected in accounts payable within the accompanying consolidated balance sheet at December 31, 2017. On February 21, 2017, XIFIN, Inc. (“XIFIN”) filed a lawsuit against us in the District Court for the Southern District of California alleging breach of written contract and seeking recovery of approximately $0.27 million owed by us to XIFIN for damages arising from a breach of our obligations pursuant to a Systems Services Agreement between us and XIFIN, dated as of February 22, 2013, as amended and restated on September 1, 2014. On April 5, 2017, the court clerk entered default against the Company. On May 5, 2017, XIFIN filed an application for entry of default judgment against us. During the year ended December 31, 2017, we made payments totaling $0.1 million and a $0.2 million liability has been recorded and is reflected in accounts payable within the accompanying consolidated balance sheet at December 31, 2017. CPA Global provides us with certain patent management services. On February 6, 2017, CPA Global claimed that we owe approximately $0.2 million for certain patent maintenance services rendered. CPA Global has not filed claims against us in connection with this allegation. During the year ended December 31, 2017, we made payments of less than $0.1 million and a liability of approximately less than $0.1 million has been recorded and is reflected in accounts payable within the accompanying consolidated balance sheet at December 31, 2017. On March 9, 2016, counsel for Edge BioSystems, Inc. (“EdgeBio”) sent a demand letter on behalf of EdgeBio to us in connection with the terms of an Asset Purchase Agreement dated September 8, 2015 (the “EdgeBio Agreement”). EdgeBio alleges, among other things, that certain customers of EdgeBio erroneously remitted payments to us, that such payments should have been paid to EdgeBio and that we failed to remit these funds to EdgeBio in violation of the terms of the EdgeBio Agreement. On September 13, 2016, we received a demand for payment letter from EdgeBio’s counsel alleging that the balance due to EdgeBio is approximately $0.1 million. On September 19, 2017 a summary of action from the Judicial District of New Haven, CT for a judgement of $113,000 was issued. We and Edge-Bio reached an agreement on payment and we paid $63,000 on December 21, 2017 with another $63,000 due within 180 days from the initial payment. A liability of approximately $0.1 million has been recorded and is reflected in accounts payable within the accompanying consolidated balance sheet at December 31, 2017. On February 17, 2017, Jesse Campbell (“Campbell”) filed a lawsuit individually and on behalf of others similarly situated against us in the District Court for the District of Nebraska alleging we had a materially incomplete and misleading proxy relating to a potential merger and that the merger agreement’s deal protection provisions deter superior offers. As a result, Campbell alleges that we have violated Sections 14(a) and 20(a) of the Exchange Act and Rule 14a-9 promulgated thereafter. Although we intend to defend the lawsuit, there can be no assurance regarding the ultimate outcome of this case. Given the uncertainty of litigation, the legal standards that must be met for, among other things, class certification and success on the merits, we are unable to estimate the amount of loss, or range of possible loss, at this time that may result from this action. In the event that a settlement is reached related to these matters, the amount of such settlement may be material to our results of operations and financial condition and may have a material adverse impact on our liquidity. On February 20, 2018, Crede Capital Group LLC (“Crede”) filed a lawsuit against us in the Supreme Court of the State of New York for Summary Judgment in Lieu of Complaint requiring us to pay cash owed to Crede. Crede claims that Precipio has breached a Securities Purchase Agreement and Warrant that Crede entered into in connection with an investment in Transgenomic and that pursuant to those agreements, we owed Crede the sum of $2.2 million. In addition to the aforementioned sum, Crede also demanded that we pay an additional sum of $3,737.32 per day between the date of the summons and the date that judgment is entered, plus interest. As previously disclosed by us, Crede had sent us a letter claiming that we owed Crede $1.8 million. On March 12, 2018, we entered into a settlement agreement with Crede pursuant to which we agreed to pay Crede a total sum of $1.925 million ov er a period of 16 months payable in cash , or at the Company’s discretion, in stock, in accordance with terms contained in the Agreement. In accordance with the terms of the agreement and in addition to the agreement to pay, we have also executed and delivered to Crede an affidavit of confession of judgment. Liabilities totaling approximately $ 1.9 million have been recorded and are reflected in other current liabilities and common stock warrant liability within the accompanying consolidated balance sheet at December 31, 2017. On March 19, 2018 we made the first scheduled payment of $175,000 to Crede. On March 21, 2018, Bio-Rad Laboratories filed a lawsuit against us in the Superior Court Judicial Branch of the State of Connecticut for Summary Judgment in Lieu of Complaint requiring us to pay cash owed to Bio-Rad in the amount of $39,000 . We are currently in discussions with Bio-Rad to reach payment conditions. A liability of less than $0.1 million has been recorded in accounts payable within the accompanying consolidated balance sheet at December 31, 2017. L EGAL AND REGULATORY ENVIRONMENT The healthcare industry is subject to numerous laws and regulations of federal, state and local governments. These laws and regulations include, but are not limited to, matters such as licensure, accreditation, government healthcare program participation requirement, reimbursement for patient services and Medicare and Medicaid fraud and abuse. Government activity has increased with respect to investigations and allegations concerning possible violations of fraud and abuse statutes and regulations by healthcare providers. Violations of these laws and regulations could result in expulsion from government healthcare programs together with the imposition of significant fines and penalties, as well as significant repayments for patient services previously billed. Management believes that the Company is in compliance with fraud and abuse regulations, as well as other applicable government laws and regulations. While no material regulatory inquiries have been made, compliance with such laws and regulations can be subject to future government review and interpretation, as well as regulatory actions unknown or unasserted at this time. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | 10. INCOME TAXES Impact of the Tax Cuts and Jobs Act In 2016, Precipio Diagnostics was organized as a limited liability company and operated under the default classification as a partnership until July 31, 2016. Effective August 1, 2016, Precipio Diagnostics elected to be treated as a corporation for tax purposes and as such, a net deferred tax asset, prior to a valuation allowance was created. The Company calculated an income tax provision for period from August 1, 2016 through December 31, 2016. The Tax Cuts and Jobs Act (the "Act") was enacted on December 22, 2017. Among other things, the Act reduces the U.S. federal corporate tax rate from 34 percent to 21 percent, eliminates the alternative minimum tax (“AMT”) for corporations, and creates a one-time deemed repatriation of profits earned outside of the U.S. The tax rate reduction also resulted in a write-down of the net deferred tax asset of approximately $1.0 million. With the exception of the IPR&D noted below, the write-down of the net deferred tax asset related to the rate reduction resulted in a corresponding write-down of the valuation allowance of approximately $1.3 million. The Company recorded a deferred tax liability of $0.3 million as of December 31, 2017, related to the acquisition of the IPR&D. This deferred tax liability was recorded to account for the book versus tax basis difference related to the IPR&D intangible asset, which was recorded in connection with the Merger. This deferred tax liability was excluded from sources of future taxable income, as the timing of its reversal cannot be predicted due to the indefinite life of this IPR&D. As such, this deferred tax liability cannot be used to offset the valuation allowance. Deferred income taxes reflect the net effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The Company’s net deferred tax assets relate primarily to its net operating loss carryforwards and stock based compensation, offset by property and equipment and intangible assets. With the exception of the IPR&D, the Company has recorded a full valuat ion allowance to offset the net deferred tax assets, because it is not more likely than not that the Company will realize future benefits associated with these net deferred tax assets at December 31, 2017 and 2016. At December 31, 2017 and 2016, the Company had net deferred tax assets of $1.5 million and $0.7 million, respectively, against which a valuation allowance of $1.8 million and $0.7 million, respectively, had been recorded. The valuation allowance excluded the deferred tax liability for IPR&D assigned as an indefinite life intangible asset for book purposes, also known as a “naked credit” in the amount of $0.3 million at December 31, 2017. The change in the valuation allowance for the year ended December 31, 2017 was an increase of $1.1 million. The increase in the valuation allowance for the year ended December 31, 2017 was mainly attributable to the reverse merger with Transgenomic, for which the Company obtained Transgenomic’s net operating losses, which were limited under the Internal Revenue Code Section 382. In addition, the increase was offset due to the recognition of deferred tax liabilities associated with the book versus tax basis difference of intangible assets purchased. There was also an offsetting decrease attributable to a decrease in the corporate tax rate. Significant components of the Company’s deferred tax assets at December 31, 2017 and 2016 are as follows: Dollars in Thousands 2017 2016 Deferred tax assets: Net operating loss and credit carryforwards $ 5,907 $ 407 Accrued interest 2 164 Stock-based compensation 61 — Other 22 110 Gross deferred tax assets 5,992 681 Deferred tax liabilities: Property and equipment (32 ) — Intangible assets (4,145 ) — IPR&D intangible assets (349 ) — Other — (16 ) Gross deferred tax liabilities (4,526 ) (16 ) Net deferred tax assets 1,466 665 Less valuation allowance (1,815 ) (665 ) Net deferred liability $ (349 ) $ — The Company’s provision for income taxes for the year ended December 31, 2017 and for the period from August 1, 2016 through December 31, 2016 relates to income taxes in states and other jurisdictions and differs from the amounts determined by applying the statutory federal income tax rate to the loss before income taxes for the following reasons: Dollars in Thousands 2017 For the period from August 1, 2016 through December 31, 2016 Benefit at federal rate $ (7,331 ) $ (421 ) Increase (decrease) resulting from: State income taxes—net of federal benefit (101 ) (27 ) Miscellaneous permanent differences 4 2 Warrant liability revaluation 81 — Capitalized transaction cost 958 — Impairment of goodwill 3,334 — Enactment of Tax Cuts and Jobs Act 1,041 — Change in valuation allowance 2,014 446 Total income tax expense (benefit) $ — $ — ttttttthh The income tax expense consists of the following at December 31, 2017 and 2016. Dollars in Thousands 2017 2016 Federal: Current $ — $ — Deferred — — Total Federal $ — $ — State: Current $ — $ — Deferred — — Total State $ — $ — Foreign: Current $ — $ — Deferred — — Total Foreign $ — $ — Total Tax Provision $ — $ — The Company had approximately $27 million and $1.0 million of available gross federal and state net operating loss (“NOL”) carryforwards as of December 31, 2017 and 2016, respectively. Section 382 of the Internal Revenue Code, and similar state regulations, contain provisions that may limit the NOL carryforwards available to be used to offset income in any given year upon the occurrence of certain events, including changes in the ownership interests of significant stockholders. In the event of a cumulative change in ownership in excess of 50% over a three-year period, the amount of the NOL carryforwards that the Company may utilize in any one year may be limited. The Company reduced its tax attributes (NOLs and tax credits) obtained from the Merger with Transgenomic and the limitation placed on the utilization of its tax attributes, as a substantial portion of the NOLs and tax credits generated prior to the Merger will likely expire unused. At December 31, 2017 and 2016, and as a result of the limitations under Section 382 of the Internal Revenue Code, the Company had a total of unused federal tax net operating loss carryforwards with expiration dates as follows: Dollars in Thousands 2017 2016 2036 $ 17,781 $ 967 2037 9,109 — Total Federal $ 26,890 $ 967 The Company has adopted guidance on accounting for uncertainty in income taxes which clarified the accounting for income taxes by prescribing the minimum threshold a tax position is required to meet before being recognized in the financial statements as well as guidance on de-recognition, measurement, classification and disclosure of tax positions. There are no material uncertain tax positions that would require recognition in the financial statements. The Company is obligated to file income tax returns in the U.S. federal jurisdiction and various U.S. states. Since the Company had losses in the past, all prior years that generated NOLs are open and subject to audit examination in relation to the NOL generated from those years. Our evaluation of uncertain tax positions was performed for the tax years ended December 31, 2014 and forward. |
STOCKHOLDERS' EQUITY (DEFICIT)
STOCKHOLDERS' EQUITY (DEFICIT) | 12 Months Ended |
Dec. 31, 2017 | |
Stockholders' Equity Note [Abstract] | |
STOCKHOLDERS' EQUITY (DEFICIT) | 11. STOCKHOLDERS’ EQUITY (DEFICIT) Common Stock. Pursuant to our Third Amended and Restated Certificate of Incorporation, as amended, we currently have 150,000,000 shares of common stock authorized for issuance. In connection with the Merger, the Company effected a 1- for-30 reverse stock split of its common stock. This reverse stock split became effective on June 13, 2017 and, unless otherwise indicated, all share amounts, per share data, share prices, exercise prices and conversion rates set forth in these notes and the accompanying consolidated financial statements have, where applicable, been adjusted retroactively to reflect this reverse stock split. Additionally, as a result of the Merger, the Company has recapitalized its stock. All historical preferred stock, common stock, restricted units, warrants and additional paid-in capital, including share and per share amounts, have been retroactively adjusted to reflect the equity structure of the combined company, including the effect of the Merger exchange ratio. Pursuant to the Merger Agreement, each outstanding unit of Precipio Diagnostics was exchanged for 10.2502 pre-reverse stock split shares of the Company's common stock. Restricted stock of 59,563 shares were granted during the year ended December 31, 2017, none of which vested prior to the merger. Upon closing of the merger, all shares fully vested. During 2017, 64,593 shares were released to common stock. We recorded stock compensation expense of approximately $28,000, within operating expense in the accompanying statements of operations, related to the restricted stock that vested during the year ended December 31, 2017. On the Closing Date, Precipio Diagnostics received 7,356,170 shares of Precipio common stock from the conversion of preferred stock, senior and junior debt, bridge notes and warrants. Also, certain advisors of Precipio Diagnostics received 321,821 shares of Precipio common stock related to services performed in connection with the Merger. The fair value of these advisory shares was $2.2 million at the date of the Merger and is included as a merger advisory fee expense in the accompanying consolidated statements of operations. As part of the Merger, Precipio Diagnostics also received 200,081 shares of Precipio common stock that have not been issued yet. These shares were originally held for future issuance to advisors pending completion of certain performance obligations, however, these obligations were not met. The shares remain with Precipio Diagnostics as part of the unissued pool. For any shares that remain unissued, it is the intent of the Company to allocate these to Precipio Diagnostics shareholders on a pro rata basis. Upon completion of the Merger, Transgenomic legacy stockholders had 1,255,119 shares of Precipio common stock outstanding. Upon the closing of the August 2017 Offering, the Company issued 359,999 shares of its common stock upon conversion of $900,000 of its New Bridge Notes (See Note 7 - Convertible Bridge Notes) and 1,735,419 shares of its common stock upon conversion of its Series A Senior stock (see below - Series A Senior Preferred Stock). Also, during the year ended December 31, 2017, the Company issued 1,550,485 shares of its common stock in connection with conversions of its Series B Preferred Stock (see below - Series B Preferred Stock) and 142,857 shares of its common stock in connection with conversions of its Series C Preferred Stock (see below - Series C Preferred Stock). On February 12, 2018, the Company issued 1,814,754 shares of its common stock in exchange for approximately $1.9 million of debt obligations. The $1.9 million in obligations is included in other current liabilities in the accompanying consolidated balance sheet as of December 31, 2017. See Note 8. Series A and Series B Preferred Stock. Prior to the Merger and as of December 31, 2016, under Precipio Diagnostics, the Company had outstanding preferred units of 367,299 for Series A and 412,806 for Series B (collectively, the "Precipio Diagnostics Preferred Stock"). These units were recapitalized and were included in preferred stock. On the Closing Date, the outstanding preferred units for the Precipio Diagnostics Preferred Stock, along with the related accumulated dividends, were converted into common shares of the Company. In March 2016, the Company entered into a redemption and exchange agreement with certain member's relating to their 275,237 Preferred A Units and 208,087 Preferred B Units, related to the Precipio Diagnostics Preferred Stock. Under the terms of the agreement, the unit holders would exchange their units in the Company for the issuance of debt. The aggregate purchase price per the agreement was the member's initial investment of $750,000 for Preferred A Units and $965,000 for Preferred B Units, along with a preferred return of 8% , recorded as a dividend in the amount of $432,716 . In addition to the debt issued as consideration for the members' preferred units Preferred Stock. The Company’s Board of Directors is authorized to issue up to 15,000,000 shares of preferred stock in one or more series, from time to time, with such designations, powers, preferences and rights and such qualifications, limitations and restrictions as may be provided in a resolution or resolutions adopted by the Board of Directors. The authority of the Board of Directors includes, but is not limited to, the determination or fixing of the following with respect to shares of such class or any series thereof: (i) the number of shares; (ii) the dividend rate, whether dividends shall be cumulative and, if so, from which date; (iii) whether shares are to be redeemable and, if so, the terms and amount of any sinking fund providing for the purchase or redemption of such shares; (iv) whether shares shall be convertible and, if so, the terms and provisions thereof; (v) what restrictions are to apply, if any, on the issue or reissue of any additional preferred stock; and (vi) whether shares have voting rights. The preferred stock may be issued with a preference over the common stock as to the payment of dividends. We have no current plans to issue any additional preferred stock. Classes of stock such as the preferred stock may be used, in certain circumstances, to create voting impediments on extraordinary corporate transactions or to frustrate persons seeking to effect a merger or otherwise to gain control of the Company. For the foregoing reasons, any additional preferred stock issued by the Company could have an adverse effect on the rights of the holders of the common stock. Series A Senior Preferred Stock. In connection with the Merger, the Company filed a Certificate of Designation with the Secretary of State of the State of Delaware on June 29, 2017, designating 4,100,000 shares of the Company’s Preferred Stock, par value $0.01 per share, as Series A Senior Convertible Preferred Stock ("Series A Senior") and establishing the rights, preferences and privileges of the new preferred stock. Generally, the holders of the Series A Senior stock are entitled to vote as a single voting group with the holders of the Company's common stock, and the holders of the Series A Senior stock are generally entitled to that number of votes as is equal to the number of whole shares of the Company's common stock into which the Series A Senior stock may be converted as of the record date of such vote or consent. So long as the shares of Series A Senior stock are outstanding certain actions will require the separate approval of at least two-thirds of the Series A Senior stock, including: changes to the terms (requires three-fourths approval) of the Series A Senior stock, changes to the number of authorized shares of Series A Senior stock, issuing a series of preferred stock that is senior to the Series A Senior stock, changing the size of the board of directors, certain changes to the capital stock of the Company, bankruptcy proceedings and granting security interests in the Company’s assets. The Series A Senior stock will be convertible into the Company's common stock at any time at the then applicable conversion price. The initial conversion price for the Series A Senior stock issued in connection with the Merger and the other transactions described herein is $3.736329 , but will be subject to anti-dilution protections including adjustments for stock splits, stock dividends, other distributions, recapitalizations and the like. Additionally, each holder of the Series A Senior stock will have a right to convert such holder's Series A Senior stock into securities issued in any future private offering of the Company's securities at a 15% discount to the proposed price in such private offering. The Series A Senior stock will be entitled to an annual 8% cumulative payment in lieu of interest or dividends, payable in-kind for the first two years and in cash or in-kind thereafter, at the option of the Company. The Series A Senior stock also will be entitled to share in any dividends paid on the Company's common stock. As discussed in Note 3 - Reverse Merger, in connection with the Merger, the Company issued 1) to holders of certain Transgenomic secured indebtedness, 802,925 shares of Series A Senior stock in an amount equal to $3 million, 2) to holders of certain Precipio Diagnostic indebtedness, 802,920 shares of Series A Senior stock in an amount equal to $3 million and 3) to certain investors, 107,056 shares of Series A Senior stock in exchange for $400,000 in a private placement. We determined that there was a beneficial conversion feature in connection with the issuances of the Series A Senior stock since the conversion price of $3.736329 was at a discount to the fair market value of the Company's common stock at issuance date. The Series A Senior stock is non-redeemable and as a result, the Company recognized the full beneficial conversion feature in the amount of $5.2 million as a deemed dividend at the time of issuance. Upon the closing of the August 2017 Offering, all of the Company’s outstanding Series A Senior stock converted into an aggregate of 1,712,901 shares of the Company's common stock, at the existing conversion rate of one share of Common Stock for one share of Series A Senior stock (the “Conversion”). The Company also issued an aggregate of 22,518 shares of Series A Senior stock to these holders, which shares represented the Series A Preferred Payment (as defined in the Company’s Certificate of Designation of Series A Senior Convertible Preferred Stock) accrued through the date of Conversion and immediately converted into an aggregate of 22,518 shares of the Company's common stock in connection with the Conversion. The Company issued warrants (the “Series A Conversion Warrants”) to purchase an aggregate of 856,446 shares of Common Stock to these former holders of Series A Senior stock as consideration for the conversion of their shares of Series A Senior stock into shares of Common Stock. The Company treated this as an induced conversion of the Series A Senior stock. At the date of the Conversion, the fair value of the Series A Conversion Warrants was approximately $1.4 million. The Company determined that the $1.4 million represented the excess fair value of all consideration transferred to the Series A Senior holders as compared to the fair value of the Series A Senior stock pursuant to its original conversion terms. The $1.4 million was recorded as a deemed dividend at the time of the Conversion. The Series A Preferred Payment of 22,518 shares of Series A Senior stock had a fair value of approximately $84,000 at the time of issuance and was recorded as a deemed dividend on preferred shares. At December 31, 2017, the Company had designated, issued and outstanding shares of Series A Senior in the amount of 4,100,000 , 1,712,901 and zero , respectively. Series B Preferred Stock. On August 25, 2017, the Company filed a Certificate of Designation of Preferences, Rights and Limitations of Series B Convertible Preferred Stock (“Series B Preferred Stock”) with the State of Delaware which designates 6,900 shares of our preferred stock as Series B Preferred Stock. The Series B Preferred Stock has a stated value of $1,000 per share and a par value of $0.01 per share. The Series B Preferred Stock includes a beneficial ownership blocker but has no dividend rights (except to the extent dividends are also paid on the common stock). On August 28, 2017, the Company completed the August 2017 Offering of 6,000 units consisting of one share of the Company’s Series B Preferred Stock, which is convertible into 400 shares of common stock, par value $0.01 per share, at a conversion price of $2.50 per share, and one warrant to purchase up to 400 shares of common stock (the “August 2017 Offering Warrants”) at a combined public offering price of $1,000 per unit. The August 2017 Offering included the sale of 280,000 August 2017 Offering Warrants pursuant to the over-allotment option exercised by Aegis Capital Corp. (“Aegis”) for $0.01 per share or $2,800 . The Offering was completed pursuant to the terms of an underwriting agreement dated as of August 22, 2017 (the “Underwriting Agreement”) between the Company and Aegis. The net proceeds received by the Company from the sale of the units was approximately $5.0 million, after deducting underwriting discounts and estimated offering expenses, which have been recorded as stock issuance costs within additional paid in capital. For purposes of recording this transaction, the gross proceeds of $6.0 million from the August 2017 Offering were allocated to the Series B Preferred Stock and the August 2017 Offering Warrants based on their relative fair values at the date of issuance. The portion allocated to the Series B Preferred stock was $3.1 million with the remaining $2.9 million allocated to the August 2017 Offering Warrants. As a result of the allocation of the proceeds, we determined that there was a beneficial conversion feature in connection with the issuance of the Series B Preferred Stock since the calculated effective conversion price was at a discount to the fair market value of the Company's common stock at issuance date. The Company recognized the full beneficial conversion feature in the amount of $2.3 million as a deemed dividend at time of issuance. The conversion price of the Series B Preferred Stock contains a down round feature. As discussed in Note 2 of the accompanying consolidated financial statements, the Company early adopted ASU 2017-11, which allowed the Company to treat the preferred stock as equity classified, despite the down round provision. The Company will recognize the effect of the down round feature when it is triggered. At that time, the effect would be treated as a deemed dividend and as a reduction of income available to common shareholders in our basic earnings per share calculation. In November 2017, the down round feature of the Series B Preferred Stock was triggered at the time of the Company’s issuance of its Series C Preferred Stock and, as a result, the conversion price of the Series B Preferred Stock was reduced from $2.50 per share to $1.40 per share. In connection with the down round adjustment, the Company calculated an incremental beneficial conversion feature of approximately $2.0 million which was recognized as a deemed dividend at time of the down round adjustment. During the year ended December 31, 2017, 3,613 shares of Series B Preferred Stock were converted into 1,550,485 shares of our common stock. At December 31, 2017, the Company had designated, issued and outstanding shares of Series B in the amount of 6,900 , 6,900 and 2,387 , respectively. Series C Preferred Stock On November 6, 2017, the Company filed a Certificate of Designation of Preferences, Rights and Limitations of Series C Convertible Preferred Stock (“Series C Preferred Stock”) with the State of Delaware which designates 2,748 shares of our preferred stock as Series C Preferred Stock. The Series C Preferred Stock has a stated value of $1,000 per share and a par value of $0.01 per share. On November 2, 2017, the Company entered into a Placement Agency Agreement (the “Placement Agreement”) with Aegis Capital Corp. for the sale on a reasonable best efforts basis of 2,748 units, each consisting of one share of the Company’s Series C Preferred Stock, convertible into a number of shares of the Company’s common stock equal to $1,000 divided by $1.40 and warrants to purchase up to 1,962,857 shares of common stock with an exercise price of $1.63 per share (the “Series C Warrants”) at a combined offering price of $1,000 per unit, in a registered direct offering (the “Series C Preferred Offering”). The Series C Preferred Stock includes a beneficial ownership blocker but has no dividend rights (except to the extent dividends are also paid on the common stock). The securities comprising the units are immediately separable and were issued separately. The gross proceeds to the Company from the sale of the Series C Preferred Stock and Series C Warrants, before deducting the placement agent fee and other estimated offering expenses payable by the Company and assuming no exercise of the Series C Warrants, were $2,748,000 . The offering closed on November 9, 2017. For purposes of recording this transaction, the gross proceeds of $2.8 million from the Series C Preferred Offering were allocated to the Series C Preferred Stock and the Series C Warrants based on their relative fair values at the date of issuance. The portion allocated to the Series C Preferred stock was $1.5 million with the remaining $1.3 million allocated to the Series C Warrants. As a result of the allocation of the proceeds, we determined that there was a beneficial conversion feature in connection with the issuance of the Series C Preferred Stock since the calculated effective conversion price was at a discount to the fair market value of the Company's common stock at issuance date. The Company recognized the full beneficial conversion feature in the amount of $1.2 million as a deemed dividend at time of issuance. The Series C Preferred Offering required the Company to adjust downward the exercise and conversion prices of various warrants and Series B Preferred Stock that were outstanding at the time of the closing of the Series C Preferred Offering due to the down round provisions contained in certain of the Company's warrants and Series B Preferred Stock. During the year ended December 31, 2017, 200 shares of Series C Preferred Stock were converted into 142,857 shares of our common stock. At December 31, 2017, the Company had designated, issued and outstanding shares of Series C in the amount of 2,748 , 2,748 and 2,548 , respectively. Liquidation Preferences. The following is the liquidation preferences for the Company’s preferred stock; The Series B Preferred Stock and Series C Preferred Stock have identical terms regarding liquidation preferences. Upon any liquidation, dissolution or winding-up of the Corporation, whether voluntary or involuntary, the holders shall be entitled to receive out of the assets of the Corporation an amount equal to the par value, plus any accrued and unpaid dividends thereon, for each share of Preferred Stock before any distribution or payment shall be made to the holders of the Common Stock, and if the assets of the Corporation shall be insufficient to pay in full such amounts, then the entire assets to be distributed to the holders shall be ratably distributed among the holders in accordance with the respective amounts that would be payable on such shares. If all amounts were paid in full; and thereafter, the holders shall be entitled to receive out of the assets, whether capital or surplus, of the Corporation the same amount that a holder of Common Stock would receive if the Preferred Stock were fully converted to Common Stock which amount shall be paid pari passu with all holders of Common Stock. For Series A Senior preferred stock, upon any liquidation, dissolution or winding-up of the Corporation, whether voluntary or involuntary, the Holders shall be entitled to receive out of the assets of the Corporation an amount equal to the greater of the (A) the sum of (1) 1.5 times the Series A Stated Value as adjusted for any stock dividends, combinations or splits with respect to such shares plus (2) all accrued but unpaid Series A Preferred Payments through the Liquidation Event, as adjusted for any stock dividends, combinations or splits with respect to such shares and (B) such amount per share of the Series A Preferred as would have been payable had each share been converted into Common Stock immediately prior to such Liquidation Event . Common Stock Warrants. Prior to the Merger, in connection with the line of credit with Connecticut Innovations, the Company issued warrants to purchase 8,542 Series A Preferred shares of the Company, which were classified as an equity warrant, at an exercise price of $2.93 per unit, subject to adjustments as defined in the warrant agreement. The warrants were valued at $6,000 at the date of the grant utilizing the Black-Sholes model (volatility 40% , expected life 7 years, and risk free rate .36% ). The value of the warrants was treated as a debt discount. At the Merger date, the warrants were exercised for $25,000 and then converted into shares of Precipio common stock. In connection with the Webster Bank agreement, the Company issued 7 years warrants to purchase 20,000 Series B Preferred shares of the Company. At the Merger date, Webster Bank declined to exercise their warrants and, per the terms of the warrant agreement, the warrants were retired. During 2016, Precipio Diagnostics issued common warrant units, which allows the holders to collectively purchase common units of the Company, representing approximately 60% of the Company at the time of exercise. At the time of issuance, this represented 1,958,166 common units. The common warrant units had a $0.00 exercise price with a ten year expiration date. The common warrant units were classified as equity awards and the fair value upon issuance was calculated utilizing a discounted cash flow analysis to value the Company's equity and an option pricing method to allocate the value of the equity. The fair value of the warrants was determined directly utilizing the option pricing method as the exercise price was $0.00. The aggregate value of the common warrant units was $1,421,738 , which was considered a deemed dividend. At the time of the Merger, these warrants were converted into 1,958,166 shares of Precipio common stock. Warrants Assumed in Merger At the time of the Merger, Transgenomic had a number of outstanding warrants related to various financing transactions that occurred between 2013-2016. Details related to year issued, expiration date, amount of underlying common shares and exercise price are included in the table below. 2017 New Bridge Warrants During the year ended December 31, 2017, prior to the Merger, Transgenomic completed the sale of the 2017 Bridge Notes in the amount of $1.2 million and the issuance of the 2017 Bridge Warrants to acquire 40,000 shares of the Company's common stock at an exercise price of $15.00 per share, subject to anti-dilution protection. Aegis acted as placement agent for the bridge financing and received Aegis Warrants to acquire 5,600 shares of Transgenomic common stock at an exercise price of $15.00 per share. The Aegis Warrants are identical to the 2017 Bridge Warrants except that the Aegis Warrants do not have anti-dilution protection. (See Note 7 - Convertible Bridge Notes). In connection with the Merger, the holders of the 2017 Bridge Notes, the 2017 Bridge Warrants and the Aegis Warrants agreed to exchange the 2017 Bridge Notes, the 2017 Bridge Warrants and the Aegis Warrants for 2017 New Bridge Notes and the 2017 New Bridge Warrants to acquire 45,600 shares of our common stock. (See Note 7 - Convertible Bridge Notes). The initial exercise price of the 2017 New Bridge Warrants was $7.50 (subject to adjustments). These warrants had a one-time down round provision that if the Company completed a Qualified Offering (as defined in the 2017 New Bridge Warrants), the exercise price of the 2017 New Bridge Warrants would become the lower of (i) $7.50 or (ii) 110% of the per share offering price in the Qualified Offering, but in no event lower than $1.50 per share. As a result of the Series B Preferred Stock issued in the August 2017 Offering, the exercise price of the 2017 New Bridge Warrants was adjusted to $2.75 per share, and the down round provision for these warrants no longer exists after this adjustment. At issuance, the 2017 New Bridge Warrants had a fair value of $211,000 and were recorded as a debt discount to the related 2017 New Bridge Notes I, with the corresponding entry to additional paid in capital as the warrants were considered classified as equity in accordance with GAAP. At the time the exercise price was adjusted, due to the down round provision triggered by the August 2017 Offering, the Company calculated the fair value of the down round provision on the warrants to be approximately $12,000 and recorded this as deemed dividend. Side Warrants In connection with the bridge financing and the assumption of certain obligations by an entity controlled by Mark Rimer (a director of the Company), the Company issued to that entity Side Warrants to purchase an aggregate of 91,429 shares of the Company's common stock at an exercise price of $7.00 per share (subject to adjustment), with a fair value of $487,000 at the date of issuance. The Side Warrants have a term of 5 years and are exercisable as to 22,857 shares of the Company's common stock upon grant and as to 68,572 shares of the Company's common stock upon the entity’s performance of the assumed obligations. All performance obligations have been met and the Company has recorded merger advisory expense of $487,000 related to the Side Warrants during the year ended December 31, 2017. August 2017 Offering Warrants In connection with the August 2017 Offering, the Company issued 2,680,000 warrants at an exercise price of $3.00 , which contain a down round provision. The August 2017 Offering Warrants were exercisable immediately and expire 5 years from date of issuance. The terms of the August 2017 Offering Warrants prohibit a holder from exercising its August 2017 Offering Warrants if doing so would result in such holder (together with its affiliates) beneficially owning more than 4.99% of the Company’s outstanding shares of common stock after giving effect to such exercise, provided that, at the election of a holder and notice to the Company, such beneficial ownership limitation may be increased to 9.99% of the Company’s outstanding shares of common stock after giving effect to such exercise. As a result of the Series C Preferred Offering, the exercise price of the August 2017 Offering Warrants was adjusted to $1.40 per share. At the time the exercise price was adjusted, the Company calculated the fair value of the down round provision on the warrants to be approximately $211,000 and recorded this as a deemed dividend. Representative Warrants In accordance with the underwriting agreement for the August 2017 Offering, the underwriter purchased 60,000 warrants, with an exercise price of $3.125 , for an aggregate price of $100 . The Representative Warrants are exercisable beginning one year after the date of the prospectus for the August 2017 Offering and expiring on a date which is no more than five years from the date of the prospectus for the August 2017 Offering. The fair value of the warrants at date of issuance of approximately $113,000 was treated as a stock issuance cost and recorded as a reduction to additional paid in capital. Series A Conversion Warrants The Company issued Series A Conversion Warrants to purchase an aggregate of 856,446 shares of the Company's common stock at an exercise price of $10.00 per share, which have a term of 5 years. At the time of issuance, the Series A Conversion Warrants had a fair value of $1.4 million and, as discussed in the Series A Senior Preferred Stock section above, these were issued and recorded as deemed dividends. Note Conversion Warrants Upon the closing of the August 2017 Offering, $900,000 of the Company’s New Bridge Notes were converted into an aggregate of 359,999 shares of the Company's common stock and 359,999 Note Conversion Warrants. The Note Conversion Warrants have an exercise price of $3.00 per share and a five year term. The exercise price contains a down round provision. The conversion of the Company's New Bridge Notes was treated as an induced conversion and at the date of the conversion the Company recorded an expense of approximately $1.0 million which is included in loss on extinguishment of debt and induced conversion of convertible bridge notes in our consolidated statements of operations (See Note 7 - Convertible Bridge Notes). As a result of the Series C Preferred Offering, the exercise price of the Note Conversion Warrants was adjusted to $1.40 per share. At the time the exercise price was adjusted, the Company calculated the fair value of the down round provision on the warrants to be approximately $28,000 and recorded this as a deemed dividend. Convertible Promissory Note Warrants On August 31, 2017, the Company made a payment of $83,333 , two-thirds of the then outstanding principal amount, which was more than 10 days after the Deferred Maturity Date and constituted an event of default under the terms of the Note (the “Deferred Maturity Date Event of Default”). The Company received a waiver for the Deferred Maturity Date Event of Default. As discussed in Note 6 – Long-Term Debt, in connection with the waiver obtained, the Company issued the Convertible Promissory Note Warrants to purchase 10,000 shares of the Company’s common stock. The issuance date of the Convertible Promissory Note Warrants was October 3, 2017. They have an exercise price of $3.00 per share, which contain a down round provision, and were exercisable immediately and expire 5 years from date of issuance. The fair value of the warrants at date of issuance of approximately $15,000 was recorded as interest expense and included in the consolidated statements of operations for the year ended December 31, 2017. As a result of the Series C Preferred Offering, the exercise price of the Convertible Promissory Note Warrants was adjusted to $1.40 per share. At the time the exercise price was adjusted, the Company calculated the fair value of the down round provision on the warrants to be approximately $1,000 and recorded this as a deemed dividend. Series C Warrants In connection with the Series C Preferred Offering, the Company issued 1,962,857 warrants at an exercise price of $1.63 , which contain a down round provision. Series C Warrants are exercisable on the six-month anniversary of the date of issuance and expire 5 years from date they are initially exercisable. The terms of the Series C Warrants prohibit a holder from exercising its Series C Warrants if doing so would result in such holder (together with its affiliates) beneficially owning more than 4.99% of the Company’s outstanding shares of common stock after giving effect to such exercise, provided that, at the election of a holder and notice to the Company, such beneficial ownership limitation may be increased to 9.99% of the Company’s outstanding shares of common stock after giving effect to such exercise. The following represents a summary of the warrants outstanding as of December 31, 2017: Issue Year Expiration Underlying Shares Exercise Price Warrants Assumed in Merger (1) 2013 January 2018 23,055 $270.00 (2) 2014 April 2020 12,487 $120.00 (3) 2015 February 2020 23,826 $67.20 (4) 2015 December 2020 4,081 $49.80 (5) 2015 January 2021 38,732 $36.30 (6) 2016 January 2021 29,168 $36.30 Warrants (7) 2017 June 2022 45,600 $2.75 (8) 2017 June 2022 91,429 $7.00 (9) 2017 August 2022 2,680,000 $1.40 (10) 2017 August 2022 60,000 $3.125 (11) 2017 August 2022 856,446 $10.00 (12) 2017 August 2022 359,999 $1.40 (13) 2017 October 2022 10,000 $1.40 (14) 2017 May 2023 1,962,857 $1.63 6,197,681 (1) These warrants were issued in connection with an offering which was completed in January 2013. (2) These warrants were issued in connection with a private placement which was completed in October 2014. (3) These warrants were issued in connection with an offering which was completed in February 2015. (4) These warrants were issued in connection with an |
FAIR VALUE
FAIR VALUE | 12 Months Ended |
Dec. 31, 2017 | |
FAIR VALUE [Abstract] | |
FAIR VALUE | 12. FAIR VALUE FASB guidance on fair value measurements, which defines fair value, establishes a framework for measuring fair value and expands disclosures about fair value measurements for our financial assets and liabilities, as well as for other assets and liabilities that are carried at fair value on a recurring basis in our consolidated financial statements. FASB guidance establishes a three-level fair value hierarchy based upon the assumptions (inputs) used to price assets or liabilities. The three levels of inputs used to measure fair value are as follows: Level 1—Unadjusted quoted prices in active markets for identical assets or liabilities; Level 2—Observable inputs other than those included in Level 1, such as quoted prices for similar assets and liabilities in active markets or quoted prices for identical assets or liabilities in inactive markets; and Level 3—Unobservable inputs reflecting our own assumptions and best estimate of what inputs market participants would use in pricing the asset or liability. Common Stock Warrant Liabilities. Certain of our issued and outstanding warrants to purchase shares of common stock do not qualify to be treated as equity and, accordingly, are recorded as a liability. 2016 Warrant Liability The Company assumed the 2016 Warrant Liability in the Merger and it represents the fair value of Transgenomic warrants issued in January 2016, of which, 25,584 warrants remain outstanding as of December 31, 2017. We are required to record these instruments at fair value at each reporting date and changes are recorded as a non-cash adjustment to earnings. The gains or losses included in earnings are reported in other income (expense) in our consolidated Statement of Operations. The 2016 Warrant Liability is considered a Level 3 financial instrument and was valued using the Monte Carlo methodology. Assumptions and inputs used in the valuation of the common stock warrants include: remaining life to maturity of three years; annual volatility of 136% ; and a risk-free interest rate of 1.98% . During the year ended December 31, 2017, the change in the fair value of the liability measured using significant unobservable inputs (Level 3) were comprised of the following: Dollars in Thousands For the Year Ended December 31, 2017 Beginning balance at January 1 $ — Additions - liability assumed in the Merger 615 Total (gains) or losses: Recognized in earnings 226 Balance at December 31 $ 841 |
EQUITY INCENTIVE PLAN
EQUITY INCENTIVE PLAN | 12 Months Ended |
Dec. 31, 2017 | |
EQUITY INCENTIVE PLAN [Abstract] | |
EQUITY INCENTIVE PLAN | 1 3 . EQUITY INCENTIVE PLAN The Company's 2006 Equity Incentive Plan (the "2006 Plan") was terminated as to future awards on July 12, 2016. The Company's 2017 Stock Option and Incentive Plan (the "2017 Plan") was adopted by the Company's stockholders on June 5, 2017 and will expire on June 5, 2027. There are 666,666 shares of common stock reserved for issuance under the 2017 Plan . The Plan is administered by the Compensation Committee of the Board of Directors (the “Committee”), which has the authority to set the number, exercise price, term and vesting provisions of the awards granted under the Plan, subject to the terms thereof. Either incentive or non-qualified stock options may be granted to employees of the Company, but only non-qualified stock options may be granted to non-employee directors and advisors. However, in either case, the Plan requires that stock options must be granted at exercise prices not less than the fair market value of the common stock on the date of the grant. Options issued under the plan vest over periods as determined by the Committee and expire 10 years after the date the option was granted. The company accounts for all stock-based compensation payments to employees and directors, including grants of employee stock options, at fair value and expenses the benefit in operating expense in the consolidated statements of operations over the service period of the awards. The fair value of each stock option granted is estimated on the date of grant using the Black-Scholes option pricing model , which requires various assumptions including estimating stock price volatility, expected life of the stock option, risk free interest rate and estimated forfeiture rate. Stock Options. During the year ended December 31, 2017, The Company granted stock options to employees and directors to purchase up to 232,332 shares of common stock at a weighted average exercise price of $1.85 . These awards have vesting periods of three to four years and had a weighted average grant date fair value of $1.59 . The fair value calculation of options granted during 2017 used the follow assumptions: risk free interest rates of 1.87% to 2.01% , based on the U.S. Treasury yield in effect at the time of grant; expected life of six years; and volatility of 118% based on historical volatility of the Company’s common stock over a time that is consistent with the expected life of the option. The following table summarizes stock option activity under our plans during the year ended December 31, 2017: Number of Options Weighted-Average Exercise Price Outstanding at January 1, 2017 24,600 $ 107.83 Granted 232,332 1.85 Forfeited (20,448 ) 68.39 Outstanding at December 31, 2017 236,484 $ 7.12 Exercisable at December 31, 2017 13,161 $ 93.27 As of December 31, 2017, there were 180,645 options that were vested or expected to vest with an aggregate intrinsic value of zero and a remaining weighted average contractual life of 9.6 years. During both of the years ended December 31, 2017 and 2016, we recorded compensation expense for all stock awards of less than $0.1 million within operating expense in the accompanying statements of operations . As of December 31, 2017, the unrecognized compensation expense related to unvested stock awards was $0.3 million, which is expected to be recognized over a weighted-average period of 3.6 years. Stock Appreciation Rights ( “ SARs ” ) As of December 31, 2017, zero SARs shares were outstanding. During year ended December 31, 2017, the SARs liability decreased approximately $8,000 and at December 31, 2017, no liability was recorded in accrued expenses since there were no shares outstanding. |
NET SALES SERVICE REVENUE AND A
NET SALES SERVICE REVENUE AND ACCOUNTS RECEIVABLE | 12 Months Ended |
Dec. 31, 2017 | |
Net Sales Service Revenue and Accounts Receivable [Abstract] | |
Net Sales Service Revenue and Accounts Receivable | 1 4 . SALES SERVICE REVENUE, NET AND ACCOUNTS RECEIVABLE S ales Revenue includes service revenue (patient diagnostic services and contract diagnostic services) and clinical research grants. The following table summarizes service revenue, net of contractual allowances, for the years ended December 31, 2017 and 2016: 2017 2016 Service revenue $ 2,565 $ 3,385 Less: contractual allowances and adjustments (863 ) (1,284 ) Service revenue, net $ 1,702 $ 2,101 The following summarizes by payer type for the years ended December 31, 2017 and 2016: 2017 2016 Medicaid $ 39 $ 25 Medicare 569 688 Self-pay 103 253 Third party payers 500 1,135 Contract diagnostic services 491 — $ 1,702 $ 2,101 Revenue from the Medicare and Medicaid programs account for a portion of the Company’s patient diagnostic service revenue. Laws and regulations governing those programs are extremely complex and subject to interpretation. As a result, there is at least a reasonable possibility that recorded estimates will change by a material amount in the near term. Revenue from c linical research grants are federal or state grants awarded to the Company to fund salaries, fringe benefits, and the purchase of supplies and equipment for specific research and development projects. Clinical research grant revenue of $0.3 million in 2017 includes grants from the National Cancer Institute of the National Institutes of Health and from the State of Nebraska Department of Economic Development. The project activities involved development of ICE COLD-PCR to interrogate multiple genes taken from blood samples. The grant period ended December 31, 2017. The Company recognized revenue from three and two customers in 2017 and 2016, respectively, that represented in the aggregate 50 percent (ranging from 15 to 20 percent) and 33 percent (ranging from 15 to 18 percent) of net revenues, respectively. No other customers represented 10% or greater of net revenue. Accounts Receivable The Company has provided an allowance for potential credit losses, which has been determined based on management’s industry experience. The Company grants credit without collateral to its patients, most of who are insured under third party payer agreements. The following summarizes the mix of receivables for the years ended December 31, 2017 and 2016: 2017 2016 Medicaid $ 37 $ 22 Medicare 256 232 Self-pay 53 63 Third party payers 1,066 881 Contract diagnostic services 445 — Other — — $ 1,857 1,198 Less allowance for doubtful accounts (1,127 ) (810 ) Accounts receivable, net $ 730 $ 388 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2017 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | 15. SUBSEQUENT EVENTS Loan Agreement On January 8, 2018, the Company received gross proceeds of $400,000 when it entered into an agreement with the Connecticut Department of Economic and Community Development (the “DECD”) by which the Company received a grant of $100,000 and a loan of $300,000 secured by substantially all of the Company’s assets (the “DECD 2018 Loan”.) The DECD 2018 Loan has a maturity date of January 27, 2028 and an annual interest rate of 3.25% with principal and interest payments due monthly. Amendment of the 2017 Stock Option and Incentive Plan On January 31, 2018, at a special meeting of the stockholders of the Company, the stockholders approved an amendment and restatement of the Company’s 2017 Stock Option and Incentive Plan (the “2017 Plan”) to: · increase the aggregate number of shares authorized for issuance under the 2017 Plan by 5,389,500 shares to 6,056,166 shares and cumulatively increased on January 1, 2019 and on each January 1 thereafter by the lesser of the annual increase for such year or 500,000 shares; · increase the maximum number of shares that may be granted in the form of stock options or stock appreciation rights to any one individual in any one calendar year and the maximum number of shares underlying any award intended to qualify as performance-based compensation to any one individual in any performance cycle, in each case to 1,000,000 shares of Common Stock; and · add an “evergreen” provision, pursuant to which the aggregate number of shares authorized for issuance under the 2017 Plan will be automatically increased each year beginning on January 1, 2019 by 5% of the number of shares of Common Stock issued and outstanding on the immediately preceding December 31, or such lesser number of shares determined by the Company’s Board of Directors or Compensation Committee. Equity Purchase Agreement On February 8, 2018 the Company entered into an equity purchase agreement (the “Purchase agreement”) with Leviston Resources LLC (“Leviston”) for the purchase of up to $8,000,000 (the “Aggregate Amount”) of shares (the “ Shares”) of the Company’s common stock from time to time, at the Company’s option. Shares offered and sold prior to February 13, 2018 were issued pursuant to the Company’s shelf registration statement on Form S-3 (and the related prospectus) that the Company filed with the Securities and Exchange Commission (the “SEC”) and which was declared effective by the SEC on February 13, 2015 (the “Shelf Registration Statement”). Sales of the Company’s common stock, if any, may be made in sales deemed to be “at-the-market” equity offerings as defined in Rule 415 promulgated under the Securities Act of 1933, as amended (the “Securities Act”), at a purchase price equal to 97.25% of the volume weighted average sales price of the common stock reported on the date that Leviston receives a capital call from the Company. Leviston purchased 721,153 shares (the “Investor Shares”) of the Company’s common stock following the close of business on February 9, 2018, subject to customary closing conditions, at a price per share of $1.04 . The shares were sold pursuant to the Shelf Registration Statement. The net proceeds to the Company from this sale were approximately $744,000 . In consideration of Leviston’s agreement to enter into the Purchase Agreement, the Company agreed to pay to Leviston a commitment fee in shares of the Company’s common stock equal in value to 5.25% of the total Aggregate Amount (the “Commitment Shares”), payable as follows: 1.75% on or before February 12, 2018. This amount, of $140,000 , was paid to Leviston through the issuance of 170,711 shares of the Company’s common stock on February 12, 2018; 1.75% on the third calendar day after the date on which the registration statement on Form S-1 that the Company plans to file with the SEC is declared effective by the SEC; and 1.75% on the thirtieth calendar day after the date on which such registration statement on Form S-1 is declared effective by the SEC. The Company agreed to pay to Leviston, on each day that Leviston receives a capital call from the Company, all expenses associated with depositing, clearing, selling and mailing of the stock certificates, a fee of 0.75% of any amount purchased by Leviston. Also, the Company paid $35,000 to Leviston for a documentation fee for preparing the Purchase Agreement. Leviston will refund the Company $15,000 if certain future conditions are met. Because the Company’s existing registration statement on Form S-3 expired on February 13, 2018 and, due to the timing of the filing of the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2017, the Company will not be eligible to file a new Form S-3 registration statement until September 1, 2018, the Company agreed to prepare and file with the SEC a registration statement on Form S-1 the (“S-1 Registration Statement”), by April 15, 2018 and to use reasonable best efforts to cause the S-1 Registration Statement to be declared effective by the SEC within ninety days thereafter. If the Company does not file the S-1 Registration Statement with the SEC by April 15, 2018, the Company will be required to pay to Leviston liquidated damages in the amount of $100,000 , and liquidated damages on a sliding scale each day thereafter. The Company is also required to pay liquidated damages of $100,000 on each event of default under the Purchase Agreement. The Company has provided Leviston with customary indemnification rights under the Purchase Agreement. As a result of the issuance of the Investor Shares, the conversion price of the Company’s Series C Preferred Stock was automatically adjusted from $1.40 per share to $1.04 per share, the conversion price of the Company’s Series B Convertible Preferred Stock was automatically adjusted from $1.40 per share to $1.04 per share and the exercise price of certain warrants to purchase shares of the Company’s common stock that contain down round provisions was automatically adjusted to $1.04 per share. Issuance of Common Stock On February 12, 2018 the Company issued 1,814,754 shares of its common stock, par value $0.01 per share to several of its trade creditors that are unaffiliated with the Company in exchange for cancellation of an aggregate of $1.9 million of indebtedness to such trade creditors. (See Note 6 – Long-Term Debt for additional information). The shares were issued pursuant to the Company’s Shelf Registration Statement. Preferred Stock induced conversions On March 21, 2018, the Company entered into a Letter Agreement (the “Agreement”) with certain holders (the “Investors”) of shares of the Company’s Series B Preferred Stock and Series C Preferred Stock ( together the “Preferred Stock”), and warrants (the “Warrants”) to purchase shares of the Company’s common stock, par value $0.01 per share (“Common Stock”), issued in the Company’s public offering in August 2017 and registered direct offering in November 2017. Pursuant to the Agreement, the Company and the Investors agreed that, as a result of the issuance of shares of Common Stock pursuant to that Purchase Agreement, dated February 8, 2018, by and between the Company and the investor named therein, and effective as of the time of execution of the Agreement, the exercise price of the Warrants was reduced to $0.75 per share (the “Exercise Price Reduction”) and the conversion price of the Preferred Stock was reduced to $0.75 (the “Conversion Price Reduction”). As consideration for the Company’s agreement to the Exercise Price Reduction and the Conversion Price Reduction, (i) each Investor agreed to convert the shares of Preferred Stock held by such Investor into shares of Common Stock in increments of up to 4.99% of the shares of Common Stock outstanding as of the date of the Agreement and (ii) one Investor agreed to exercise 666,666 Warrants and another Investor agreed to exercise 500,000 Warrants in increments of up to 4.99% of the shares of Common Stock outstanding as of the date of the Agreement, in each case in accordance with the beneficial ownership limitations set forth in the Company’s Certificate of Designation of Preferences, Rights and Limitations of Series B Convertible Preferred Stock, the Company’s Certificate of Designation of Preferences, Rights and Limitations of Series C Convertible Preferred Stock and the Warrants. These transactions resulted in net cash proceeds to the Company of $0.2 million as of April 1 3 , 2018 . Nasdaq Delisting Notice On March 26, 2018, Precipio, Inc. received written notice (the “Notice”) from The Nasdaq Stock Market LLC (“Nasdaq”) indicating that, based on the closing bid price of the Company’s common stock for the preceding 30 consecutive business days (February 9, 2018 to March 23, 2018) that the Company is not in compliance with the $1.00 minimum bid price requirement for continued listing on the Nasdaq Capital Market (the “Minimum Bid Price Requirement”), as set forth in Nasdaq Listing Rule 5550(a)(2). The Notice has no immediate effect on the listing of Precipio’s common stock, and its common stock will continue to trade on the Nasdaq Capital Market under the symbol “PRPO” at this time. In accordance with Nasdaq Listing Rule 5810(c)(3)(A), Precipio has a period of 180 calendar days, or until September 24, 2018 to regain compliance with the Minimum Bid Price Requirement. To regain compliance, the closing bid price of Precipio’s common stock must meet or exceed $1.00 per share for at least ten consecutive business days during this 180 calendar day period. If Precipio is not in compliance with the Minimum Bid Price Requirement by September 24, 2018, Nasdaq may provide Precipio with a second 180 calendar day period to regain compliance. To qualify for the second 180 calendar day period, the Company would be required to (i) meet the continued listing requirement for the Nasdaq Capital Market for market value of publicly held shares and all other initial listing standards for the Nasdaq Capital Market, except for the Minimum Bid Price Requirement, and (ii) notify Nasdaq of its intent to cure its noncompliance with the Minimum Bid Price, including by effecting a reverse stock split, if necessary. If Precipio does not indicate its intent to cure the deficiency or if it does not appear to Nasdaq that it would be possible for the Company to cure the deficiency, Precipio would not be eligible for the second 180 calendar day period, and its common stock would then be subject to delisting from the Nasdaq Capital Market. If Precipio does not regain compliance within the allotted compliance period(s), including any extensions that may be granted by Nasdaq, Nasdaq will provide notice that Precipio’s common stock will be subject to delisting. Precipio would then be entitled to appeal the Nasdaq Staff’s determination to a Nasdaq Listing Qualifications Panel and request a hearing. The Company intends to monitor the closing bid price of its common stock and consider its available options to resolve its noncompliance with the Minimum Bid Price Requirement. No determination regarding Precipio’s response to the Notice has been made at this time. There can be no assurance that Precipio will be able to regain compliance with the Minimum Bid Price Requirement or will otherwise be in compliance with the other listing standards for the Nasdaq Capital Market. |
SUMMARY OF SIGNIFICANT ACCOUN22
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policy) | 12 Months Ended |
Dec. 31, 2017 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |
Principles of Consolidation | Principles of Consolidation. The consolidated financial statements include the accounts of Precipio, Inc. and our wholly owned subsidiary. All inter-company balances and transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates. The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of net sales and expenses during the reporting period. The most significant estimates and assumptions with regard to these consolidated financial statements relate to the allowance for doubtful accounts, assumptions used within the fair value of debt and equity transactions, contractual allowances and related impairments. These assumptions require considerable judgment by management. Actual results could differ from the estimates and assumptions used in preparing these consolidated financial statements. |
Risks and Uncertainties | Risks and Uncertainties. Certain risks and uncertainties are inherent in our day-to-day operations and in the process of preparing our financial statements. The more significant of those risks are presented below and throughout the notes to the consolidated financial statements. The Company operates in the healthcare industry which is subject to numerous laws and regulations of federal, state and local governments. These laws and regulations include, but are not necessarily limited to, matters such as licensure, accreditation, government healthcare program participation requirements, reimbursement for patient services, and Medicare and Medicaid fraud and abuse. Government activity has increased with respect to investigations and allegations concerning possible violations of fraud and abuse statutes and regulations by healthcare providers. Violations of these laws and regulations could result in expulsion from government healthcare programs together with the imposition of significant fines and penalties, as well as significant repayments for patient services previously billed. Management believes that the Company is in compliance with fraud and abuse regulations, as well as other applicable government laws and regulations. While no material regulatory inquiries have been made, compliance with such laws and regulations can be subject to future government review and interpretation as well as regulatory actions unknown or unasserted at this time. |
Fair Value | Fair Value. Unless otherwise specified, book value approximates fair value. The common stock warrant liability is recorded at fair value. See Note 12 - Fair Value for additional information. |
Other Current Assets | Other Current Assets. Other current assets of $0.4 million as of December 31, 2017 include prepaid assets of $0.1 million, prepaid insurance of $0.2 million and other receivables of $0.1 million. As of December 31, 2016, other current assets consisted primarily of prepaid assets. |
Concentrations of Risk | Concentrations of Risk. From time to time, we may maintain a cash position with financial institutions in amounts that exceed Federal Deposit Insurance Corporation insured limits of up to $250,000 per depositor per financial institution. We have not experienced any losses on such accounts as of December 31, 2017. Service companies in the health care industry typically grant credit without collateral to patients. The majority of these patients are insured under third-party insurance agreements. The services provided by the Company are routinely billed utilizing the Current Procedural Terminology (CPT) code set designed to communicate uniform information about medical services and procedures among physicians, coders, patients, accreditation organizations, and payers for administrative, financial, and analytical purposes. CPT codes are currently identified by the Centers for Medicare and Medicaid Services and third-party payors. The Company utilizes CPT codes for Pathology and Laboratory Services contained within codes 80000-89398. |
Inventories | Inventories. Inventories consist of laboratory supplies and are valued at cost (determined on an average cost basis, which approximates the first-in, first-out method) or net realizable value, whichever is lower. We evaluate inventory for items that are slow moving or obsolete and record an appropriate reserve for obsolescence if needed. We determined that no allowance for slow moving or obsolete inventory was necessary at December 31, 2017 and 2016. |
Property and Equipment, Net | Property and Equipment, net. Property and equipment are carried at cost, net of accumulated depreciation and amortization. Expenditures for maintenance and repairs are expensed as incurred. Depreciation and amortization are computed by the straight-line method over the estimated useful lives of the related assets as follows: Furniture and fixtures 5 to 7 years Laboratory equipment 3 to 9 years Computer equipment and software 3 to 7 years Equipment under capital leases 5 to 10 years For assets sold or otherwise disposed of, the cost and related accumulated depreciation and amortization are removed from the accounts, and any related gain or loss is reflected in operations for the period. Expenditures for major betterments that extend the useful lives of property and equipment are capitalized. |
Goodwill and Intangible Assets | Goodwill and Intangible Assets. As a result of the Merger, the Company recorded goodwill and intangible assets as part of its allocation of the purchase consideration. See Note 3 - Reverse Merger for the amounts recorded. Goodwill Goodwill represents the excess of the purchase price over the fair value of identifiable net assets of the business acquired. See Note 3 - Reverse Merger for the amount recorded. Goodwill is tested for impairment annually. We perform this impairment analysis during the fourth quarter of each year or when a significant event occurs that may indicate that the assets might be impaired. In assessing goodwill for impairment, the Company has the option to assess qualitative factors to determine whether events or circumstances indicate that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, for which the consolidated Company is considered one reporting unit. If this is the case, then performing the quantitative goodwill impairment test is unnecessary. An entity can choose not to perform a qualitative assessment for any or all of its reporting units, and proceed directly to the use of the quantitative impairment test. In assessing qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount, the relevant events and circumstances that may impact the fair value and the carrying amount of a reporting unit are assessed. The identification of relevant events and circumstances and how these may impact a reporting unit’s fair value or carrying amount involve significant judgments by management. These judgments include the consideration of macroeconomic conditions, industry and market considerations, cost factors, overall financial performance, events which are specific to the company, and trends in the market price of our common stock. Each factor is assessed to determine whether it impacts the impairment test positively or negatively, and the magnitude of any such impact. During the year ended December 31, 2017 , the Company experienced a decline in its share price and a significant reduction in its market capitalization, as such the Company determined that an assessment of goodwill should be performed using the qualitative approach described above. Based on the qualitative assessment, the Company concluded that it was more likely than not that the fair value of the Company was less than its carry value. While there were positive qualitative factors discovered during the qualitative analysis, the instability of the market price of the Company’s common stock and the decline in revenues were significant adverse factors that directed a full assessment. As part of its analysis, the Company considered triggering events and compared its fair value with its carrying value. The analysis of the fair value of the Company involved using the market capitalization and the discounted cash flow model. Based on the analysis, the Company concluded that its carrying value exceeded its fair value and goodwill impairment in the amount of $9.3 million was recorded f or the year ended December 31, 2017. Intangibles We review our amortizable long-lived assets for impairment annually or whenever events indicate that the carrying amount of the asset (group) may not be recoverable. An impairment loss may be needed if the sum of the future undiscounted cash flows is less than the carrying amount of the asset (group). The amount of the loss would be determined by comparing the fair value of the asset to the carrying amount of the asset (group). There were no impairment charges during the year ended December 31, 2017. In-process research and development (“IPR&D”) represents the fair value assigned to research and development assets that were not fully developed at the date of the Merger. Until the IPR&D projects are completed, the assets are accounted for as indefinite-lived intangible assets and subject to impairment testing. For the year ended December 31, 2017, there was no impairment of IPR&D. |
Debt Issuance Costs and Debt Discounts | Debt Issuance Costs and Debt Discounts. Debt issuance costs and debt discounts are being amortized over the lives of the related financings on a basis that approximates the effective interest method. Both are presented as a reduction of the related debt in the accompanying balance sheets. Deferred issuance costs increased by $1.8 million due to debt issuance costs and debt discounts recorded in connection with the issuance of convertible bridge notes (see Note 7 –Convertible Bridge Notes for further information). Net debt issuance costs and debt discounts were zero and $65,048 at December 31, 2017 and 2016, respectively (net of accumulated amortization of zero and $87,342 , respectively). During the year ended December 31, 2017, the convertible bridge notes were either extinguished through cash payments or converted to shares of the Company’s common stock. Upon the payments and conversions, all remaining debt discounts and debt issuance costs associated with the conversions were fully amortized to interest expense and debt discounts and debt issuance costs associated with the portion paid in cash were amortized to interest expense up through the payment date (see Note 7 – Convertible Bridge Notes for further discussion). Amortization expense was $1.9 million and $32,662 for the years ended December 31, 2017 and 2016, respectively. |
Stock-Based Compensation | Stock-Based Compensation. All stock-based awards to date have exercise prices equal to the market price of our common stock on the date of grant and have ten -year contractual terms. Stock-based compensation cost is based on the fair value of the portion of stock-based awards that is ultimately expected to vest. The Company utilizes the Black-Scholes option pricing model for determining the estimated fair value for stock-based awards. Unvested awards as of December 31, 2017 had vesting periods of up to four years from the date of grant. None of the awards outstanding at December 31, 2017 are subject to performance or market-based vesting conditions. |
Net Sales Recognition | Net Sales Recognition. Revenue is realized and earned when all of the following criteria are met: ∠ Persuasive evidence of an arrangement exists; ∠ Delivery has occurred or services have been rendered; ∠ The seller’s price to the buyer is fixed or determinable; and ∠ Collectability is reasonably assured. We primarily recognize revenue for diagnostic services upon completion of the testing process. Patient diagnostic service revenue is reported at the estimated net realizable amounts from patients, third-party payors and others for services rendered, including retroactive adjustment under reimbursement agreements with third-party payors. Revenue under third-party payor agreements is subject to audit and retroactive adjustment. Provisions for third-party payor settlements are provided in the period in which the related services are rendered and adjusted in the future periods, as final settlements are determined. We also perform contract diagnostic services on a project by project basis as well as clinical research projects sponsored by federal and state agencies. When we receive payment in advance, we initially defer the revenue and recognize it when we deliver the service. These projects typically do not extend beyond one year. Deferred net sales included in the balance sheet as deferred revenue was less than $0.1 million as of December 31, 2017 and 2016. Taxes collected from customers and remitted to government agencies for specific net sales producing transactions are recorded net with no effect on the income statement. |
Accounts Receivable | Accounts Receivable Accounts Receivable result from diagnostic services provided to self-pay and insured patients, project based testing services and clinical research. The payment for services provide by the Company are generally due within 30 days from the invoice date. Accounts receivable are reduced by an allowance for doubtful accounts. In evaluating the collectability of accounts receivable, the Company analyzes and identifies trends for each of its sources of revenue to estimate the appropriate allowance for doubtful accounts. For receivables associated with self-pay patients, including patients with insurance and a deductible and copayment, the Company records an allowance for doubtful accounts in the period of services on the basis of past experience of patients unable or unwilling to pay for service fee for which they are financially responsible. For receivables associated with services provided to patients with third-party coverage, the Company analyzes contractually due amounts and provides an allowance, if necessary. The difference between the standard rates and the amounts actually collected after all reasonable collection efforts have been exhausted is charged against the allowance for doubtful accounts. |
Presentation of Insurance Claims and Related Insurance Recoveries | Presentation of Insurance Claims and Related Insurance Recoveries. The Company accounts for its insurance claims and related insurance recoveries at their gross values as standards for health care entities do not allow the Company to net insurance recoveries against the related claim liabilities. There were no insurance claims or insurance recoveries recorded during the years ended December 31, 2017 and 2016. |
Advertising Costs | Advertising Costs. Advertising costs are expensed as incurred. Advertising costs charged to operations totaled $8,300 in 2017 and $12,900 in 2016. |
Research and Development Costs | Research and Development Costs. All costs associated with internal research and development are expensed as incurred. These costs include salaries and employee related expenses, operating supplies and facility-related expenses. Research and development costs charged to operations totaled $0.5 million and zero for the years ended December 31, 2017 and 2016, respectively. |
Income Taxes | Income Taxes. In 2016, Precipio Diagnostics was organized as a limited liability company and operated under the default classification as a partnership until July 31, 2016. Effective August 1, 2016, Precipio Diagnostics elected to be treated as a corporation for tax purposes and as such, a net deferred tax asset, prior to a valuation allowance was created. The Company calculated an income tax provision for the remainder of the year. Prior to August 1, 2016, income tax expense or benefits were calculated at the members’ level. Deferred tax assets and liabilities are determined based on the differences between the financial reporting and tax basis of assets and liabilities at each balance sheet date using tax rates expected to be in effect in the year the differences are expected to reverse. The effect on the deferred tax assets and liabilities of a change in tax rates is recognized in the period when the change in tax rates is enacted. A valuation allowance is established when it is determined that it is more likely than not that some portion or all of the deferred tax assets will not be realized. A full valuation allowance has been applied against the Company’s net deferred tax assets as of December 31, 2017 and 2016, due to projected losses and because it is not more likely than not that the Company will realize future benefits associated with these deferred tax assets. Management’s conclusions regarding uncertain tax positions may be subject to review and adjustment at a later date based upon ongoing analysis of, or changes in tax laws, regulations and interpretations thereof as well as other factors. The Company’s policy is to record interest and penalties directly related to income taxes as income tax expense in the accompanying consolidated statements of operations, of which such amounts were immaterial for the years ended December 31, 2017 and 2016. |
Common Stock Warrants | Common Stock Warrants. The Company classifies the issuance of common stock warrants as equity any contracts that (i) require physical settlement or net-stock settlement or (ii) gives the Company a choice of net-cash settlement or settlement in its own stocks (physical settlement or net-stock settlement). The Company classifies as assets or liabilities any contracts that (i) require net-cash settlement (including a requirement to net-cash settle the contract if an event occurs and if that event is outside of the Company’s control), or (ii) gives the counterparty a choice of net-cash settlement or settlement in stock (physical settlement or net-stock settlement). Certain of our issued and outstanding warrants to purchase common stock do not qualify to be treated as equity and accordingly, are recorded as a liability (“Common Stock Warrant Liability”). We are required to present these instruments at fair value at each reporting date and any changes in fair values are recorded as an adjustment to earnings. |
Beneficial Conversion Feature | Beneficial Conversion Features. The intrinsic value of a beneficial conversion feature (“BCF”) inherent to a convertible note payable, which is not bifurcated and accounted for separately from the convertible note payable and may not be settled in cash upon conversion, is treated as a discount to the convertible note payable. This discount is amortized over the period from the date of issuance to the first conversion date using the effective interest method. If the note payable is retired prior to the end of its contractual term, the unamortized discount is expensed in the period of retirement to interest expense. In general, the BCF is measured by comparing the effective conversion price, after considering the relative fair value of detachable instruments included in the financing transaction, if any, to the fair value of the common shares at the commitment date to be received upon conversion. Deemed dividends are also recorded for the intrinsic value of conversion options embedded in preferred shares based upon the differences between the fair value of the underlying common stock at the commitment date of the transaction and the effective conversion price embedded in the preferred shares. When the preferred shares are non-redeemable the BCF is fully amortized into additional paid-in capital and preferred discount. If the preferred shares are redeemable, the discount is amortized from the commitment date to the first conversion date. |
Loss Per Share | Loss Per Share. Basic loss per share is calculated based on the weighted-average number of common shares outstanding during each period. Diluted loss per share includes shares issuable upon exercise of outstanding stock options, warrants or conversion rights that have exercise or conversion prices below the market value of our common stock. Options, warrants and conversion rights pertaining to 9,960,890 and 2,754,593 shares of our common stock have been excluded from the computation of diluted loss per share at December 31, 2017 and 2016, respectively, because the effect is anti-dilutive due to the net loss. The following table summarizes the outstanding securities not included in the computation of diluted net loss per share: |
Recent Accounting Pronouncements | December 31, 2017 2016 Stock options 236,484 3,430 Warrants 6,197,681 1,971,058 Preferred stock 3,525,000 780,105 Convertible notes 1,725 — Total 9,960,890 2,754,593 Recent Accounting Pronouncements. In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-09, Revenue from Contracts with Customers and has subsequently issued supplemental and/or clarifying ASUs (collectively “ASC 606”). ASC 606 outlines a five-step framework that intends to clarify the principles for recognizing revenue and eliminate industry-specific guidance. In addition, ASC 606 revises current disclosure requirements in an effort to help financial statement users better understand the nature, amount, timing, and uncertainty of revenue that is recognized. ASC 606 may be applied either retrospectively to each prior reporting period presented or use the modified retrospective transition method with the cumulative effect of initial adoption recognized at the date of initial application. Assessment of the new guidance is not anticipated to result in an opening balance sheet adjustment. The Company will adopt the guidance in ASU 2017-09 as of January 1, 2018 and apply the modified retrospective approach. The Company evaluated the impact of the adoption of this new revenue recognition standard utilizing the five-step framework of ASC 606 for all services, that include laboratory testing services provided to patients and customer related laboratory service contracts encompassing biomarker testing services and clinical projects. The Company concluded that control of the laboratory testing services is transferred to the customer at a point in time. As such, the Company shall continue to recognize revenue for laboratory testing services at a point in time based on the delivery method (web-portal access or fax) for patient’s laboratory report, per the contract. The Company also evaluated customer related biomarker testing and clinical project services. The Company analyzed it’s “effort based” method of assessing performance and concluded that it can reasonable measure progress towards satisfaction of the performance obligation based upon the delivery of results. The Company concludes an adjustment will not be required and a change to its current revenue recognition process and policy to adopt the new standard is not necessary. In February 2016, the FASB issued ASU No. 2016-02, Leases . The new standard amends the recognition of lease assets and lease liabilities by lessees for those leases currently classified as operating leases and amends disclosure requirements associated with leasing arrangements. The new standard is effective for fiscal years and interim periods within those fiscal years beginning after December 15, 2018. Early adoption is permitted. The new standard must be adopted using a modified retrospective transition, and provides for certain practical expedients. Transition will require application of the new guidance at the beginning of the earliest comparative period presented. We are currently assessing the impact that the adoption of this ASU will have on our consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. The new standard simplifies several aspects related to the accounting for share-based payment transactions, including the accounting for income taxes, statutory tax withholding requirements, forfeitures and classification on the statement of cash flows. This guidance is effective for fiscal years and interim periods within those fiscal years beginning after December 15, 2016. The Company adopted ASU No. 2016-09 as of January 1, 2017. The adoption of this guidance does not have a material effect on the Company’s financial position and results of operations. In August 2016, FASB issued ASU No. 2016-15 , Classification of Certain Cash Receipts and Cash Payments . ASU No. 2016-15 eliminates the diversity in practice related to the classification of certain cash receipts and payments in the statement of cash flows by adding or clarifying guidance on eight specific cash flow issues. ASU No. 2016-15 is effective for fiscal years beginning after December 15, 2017, and for interim periods within that fiscal year. We do not believe ASU No. 2016-15 will have a material effect on our financial position and results of operations. In January 2017, FASB issued ASU No. 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business. ASU No. 2017-01 adds guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The new guidance is effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. The Company adopted the new guidance on January 1, 2018, and will apply it to all applicable transactions after the adoption date. The Company does not believe ASU No. 2017-01 will have a material effect on its financial position and results of operations. In January 2017, FASB issued ASU No. 2017-04, Intangibles — Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment, which removes Step 2 from the goodwill impairment test. It is effective for annual and interim periods beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment test performed with a measurement date after January 1, 2017. The Company has adopted this standard and, as discussed above, performed impairment testing of goodwill during the year ended December 31, 2017 which resulted in the Company recording a goodwill impairment charge of $ 9.3 million. In May 2017, the FASB issued ASU 2017-09 “ Compensation – Stock Compensation (Topic 718): Scope of Modification Accounting”, which provides clarity and reduces both diversity in practice and cost and complexity when applying guidance in Topic 718. This amendment provides guidance about which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting in Topic 718. The amendments are effective for all entities for annual periods, and interim periods within those periods, beginning after December 15, 2017. The Company does not believe ASU No. 2017-09 will have a material effect on its financial position and results of operations. In July 2017, FASB issued ASU No. 2017-11, Earning Per Share (Topic 260), Distinguishing Liabilities from Equity (Topic 480) and Derivatives and Hedging (Topic 815), which was issued in two parts, Part I, Accounting for Certain Financial Instruments with Down Round Features and Part II, Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception. Part I of ASC No. 2017-11 addresses the classification analysis of certain equity-linked financial instruments (or embedded features) with down round features. When determining whether certain financial instruments should be classified as liabilities or equity instruments, a down round feature no longer precludes equity classification when assessing whether the instrument is indexed to an entity’s own stock. The amendments also clarify existing disclosure requirements for equity-classified instruments. As a result, a freestanding equity-linked financial instrument (or embedded conversion option) no longer would be accounted for as a derivative liability at fair value as a result of the existence of a down round feature. For freestanding equity classified financial instruments, the amendments require entities that present earnings per share (EPS) in accordance with Topic 260 to recognize the effect of the down round feature when it is triggered. That effect is treated as a dividend and as a reduction of income available to common shareholders in basic EPS. The amendments in Part II of ASU 2017-11 recharacterize the indefinite deferral of certain provisions of Topic 480 that now are presented as pending content in the codification, to a scope exception. Part II amendments do not have an accounting effect. The ASU 2017-11 is effective for annual and interim periods beginning after December 15, 2018, with early adoption permitted. The Company has early adopted this standard as of January 1, 2017 with the only impact being that the warrants with down round provisions are classified within equity. (See Note 7 - Convertible Bridge Notes and Note 11 - Stockholders' Equity). |
SUMMARY OF SIGNIFICANT ACCOUN23
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |
Estimated Useful Lives of Property and Equipment | Depreciation and amortization are computed by the straight-line method over the estimated useful lives of the related assets as follows: Furniture and fixtures 5 to 7 years Laboratory equipment 3 to 9 years Computer equipment and software 3 to 7 years Equipment under capital leases 5 to 10 years |
Outstanding Securities not Included in the Computation of Diluted Net Loss | The following table summarizes the outstanding securities not included in the computation of diluted net loss per share: December 31, 2017 2016 Stock options 236,484 3,430 Warrants 6,197,681 1,971,058 Preferred stock 3,525,000 780,105 Convertible notes 1,725 — Total 9,960,890 2,754,593 |
REVERSE MERGER (Tables)
REVERSE MERGER (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
REVERSE MERGER [Abstract] | |
Schedule of Business Acquisitions | The estimated purchase consideration based on the value of the equity of Transgenomic, the accounting acquiree, is as follows: (dollars in thousands) Legacy Transgenomic common stock $ 6,088 Fair value of preferred stock converted to common stock 49 Fair value of debt converted to common stock 2,398 Fair value of debt converted to preferred stock 9,796 Fair value of existing bridge notes 1,275 Fair value of warrants 1,996 Purchase consideration $ 21,602 |
Identifiable Tangible and Intangible Assets Acquired | Allocation of Purchase Consideration The following table sets forth an allocation of the purchase consideration to the identifiable tangible and intangible assets of Transgenomic, the accounting acquiree, based on fair values as of the Closing Date with the excess recorded as goodwill: (dollars in thousands) Current and other assets $ 419 Property and equipment 29 Goodwill 14,000 Other intangible assets (1) 21,100 Total assets 35,548 Current liabilities 13,423 Other liabilities 523 Total liabilities 13,946 Net assets acquired $ 21,602 (1) Other intangible assets consist of: |
Finite-Lived and Indefinite-Lived Intangible Assets Acquired as Part of Business Combination [Table Text Block] | (dollars in thousands) Acquired technology $ 18,990 Customer relationships 250 Non-compete agreements 30 Trademark and trade name 40 Backlog 200 In-process research and development 1,590 Total intangibles $ 21,100 |
Business Acquisition, Pro Forma Information | The following unaudited pro forma information presents the Company's financial results as if the acquisition of Transgenomic had occurred on January 1, 2016: Dollars in thousands, except per share amounts For the Years ended December 31, 2017 2016 Net sales $ 2,687 $ 3,280 Net loss available to common stockholders (37,389 ) (11,215 ) Loss per common share $ (4.95 ) $ (1.70 ) |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
PROPERTY AND EQUIPMENT [Abstract] | |
Summary of Property and Equipment | A summary of property and equipment at December 31, 2017 and 2016 is as follows: 2017 2016 Furniture and fixtures $ 9 $ 9 Laboratory equipment 181 153 Computer equipment and software 307 275 Equipment under capital leases 296 296 Construction in process 115 — 908 733 Less—accumulated depreciation and amortization (555 ) (453 ) Total $ 353 $ 280 |
INTANGIBLES (Tables)
INTANGIBLES (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
INTANGIBLES [Abstract] | |
Schedule of Intangible Assets | As of December 31, 2017 our intangible assets consisted of the following: Dollars in Thousands December 31, 2017 Cost Accumulated Amortization Net Book Value Technology $ 18,990 $ 475 $ 18,515 Customer relationships 250 42 208 Backlog 200 100 100 Covenants not to compete 30 15 15 Trademark 40 10 30 IPR&D 1,590 — 1,590 $ 21,100 $ 642 $ 20,458 |
Intangible Assets, Estimated Useful Life | Estimated Useful Life Technology 20 years Customer relationships 3 years Backlog 1 year Covenants not to compete 1 year Trademark 2 years |
LONG-TERM DEBT (Tables)
LONG-TERM DEBT (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Schedule of debt | Long-term debt consists of the following: Dollars in Thousands December 31, 2017 December 31, 2016 Senior Notes $ — $ 3,270 Senior Note debt issuance costs — (9 ) Junior Notes — 584 Connecticut Innovations - line of credit — 162 Department of Economic and Community Development (DECD) — 243 DECD debt issuance costs — (30 ) Webster Bank — 328 Webster Bank debt discounts and issuance costs — (26 ) Secured debt obligations 3,233 — Financed insurance loan 183 — Total long-term debt 3,416 4,522 Current portion of long-term debt (587 ) (395 ) Long-term debt, net of current maturities $ 2,829 $ 4,127 |
Schedule of Maturities of Long-term Debt [Table Text Block] | The aggregate future maturities required on long-term debt at December 31, 2017 are as follows: 2018 2019 2020 2021 2022 Total Secured Debt Obligations $ 404 $ 809 $ 808 $ 808 $ 404 $ 3,233 Financed Insurance Loan 183 — — — — 183 $ 587 $ 809 $ 808 $ 808 $ 404 $ 3,416 |
ACCRUED EXPENSES (Tables)
ACCRUED EXPENSES (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Payables and Accruals [Abstract] | |
Accrued expenses | Accrued expenses at December 31, 2017 and 2016 are as follows: 0 2017 2016 Accrued expenses $ 1,122 $ 50 Accrued compensation 126 155 Accrued interest — 495 $ 1,248 $ 700 |
Other current liabilities | During the year ended December 31, 2017, the Company was able to reduce approximately $1.1 million of certain accrued expense and accounts payable amounts through negotiations with certain vendors to settle pre-Merger liabilities. The Company recorded a gain of $1.1 million which is included in gain on settlement of liability, net in the consolidated statements of operations. Other current liabilities at December 31, 2017 and 2016 are as follows: 0 2017 2016 Obligation to issue common shares $ 1,897 $ — Liability for settlement of equity instrument 1,085 — $ 2,982 $ — |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Rental Payments for Operating Leases | The future minimum annual lease payments under these operating leases at December 31, 2017 are as follows: Years Ending December 31, 2018 $ 195,000 2019 198,000 2020 203,000 2021 208,000 2022 13,000 Total $ 817,000 |
Schedule of Capital Leases | Classes of Property: 2017 2016 Lab equipment $ 296,000 $ 296,000 Less accumulated amortization (150,000 ) (102,000) $ 146,000 $ 194,000 |
Schedule of Future Minimum Lease Payments for Capital Leases | 8 Years Ending December 31, 2018 $ 60,000 2019 60,000 2020 36,000 2021 24,000 2022 4,000 Total capital lease obligations 184,000 Less: Amount representing interest (21,000 ) Present value of net minimum lease obligations 163,000 Less, current maturities of capital leases (50,000 ) Capital Leases, long term $ 113,000 |
Purchase Obligations | Years ending December 31, 2018 $ 209,000 2019 208,000 2020 138,000 2021 99,000 2022 10,000 |
Other Commitments | Years Ending December 31, 2018 $ 1,000,000 2019 925,000 Total $ 1,925,000 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Schedule of Deferred Tax Assets And Liabilities | Dollars in Thousands 2017 2016 Deferred tax assets: Net operating loss and credit carryforwards $ 5,907 $ 407 Accrued interest 2 164 Stock-based compensation 61 — Other 22 110 Gross deferred tax assets 5,992 681 Deferred tax liabilities: Property and equipment (32 ) — Intangible assets (4,145 ) — IPR&D intangible assets (349 ) — Other — (16 ) Gross deferred tax liabilities (4,526 ) (16 ) Net deferred tax assets 1,466 665 Less valuation allowance (1,815 ) (665 ) Net deferred liability $ (349 ) $ — |
Reconciliation of the Provision for Income Taxes | Dollars in Thousands 2017 For the period from August 1, 2016 through December 31, 2016 Benefit at federal rate $ (7,331 ) $ (421 ) Increase (decrease) resulting from: State income taxes—net of federal benefit (101 ) (27 ) Miscellaneous permanent differences 4 2 Warrant liability revaluation 81 — Capitalized transaction cost 958 — Impairment of goodwill 3,334 — Enactment of Tax Cuts and Jobs Act 1,041 — Change in valuation allowance 2,014 446 Total income tax expense (benefit) $ — $ — ttttttthh |
Schedule of Income Taxes by Jurisidciton | Dollars in Thousands 2017 2016 Federal: Current $ — $ — Deferred — — Total Federal $ — $ — State: Current $ — $ — Deferred — — Total State $ — $ — Foreign: Current $ — $ — Deferred — — Total Foreign $ — $ — Total Tax Provision $ — $ — |
Summary of Operating Loss Carryforwards | Dollars in Thousands 2017 2016 2036 $ 17,781 $ 967 2037 9,109 — Total Federal $ 26,890 $ 967 |
STOCKHOLDERS' EQUITY (DEFICIT)
STOCKHOLDERS' EQUITY (DEFICIT) (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Stockholders' Equity Note [Abstract] | |
Schedule of stockholders' equity, including warrants and rights | The following represents a summary of the warrants outstanding as of December 31, 2017: Issue Year Expiration Underlying Shares Exercise Price Warrants Assumed in Merger (1) 2013 January 2018 23,055 $270.00 (2) 2014 April 2020 12,487 $120.00 (3) 2015 February 2020 23,826 $67.20 (4) 2015 December 2020 4,081 $49.80 (5) 2015 January 2021 38,732 $36.30 (6) 2016 January 2021 29,168 $36.30 Warrants (7) 2017 June 2022 45,600 $2.75 (8) 2017 June 2022 91,429 $7.00 (9) 2017 August 2022 2,680,000 $1.40 (10) 2017 August 2022 60,000 $3.125 (11) 2017 August 2022 856,446 $10.00 (12) 2017 August 2022 359,999 $1.40 (13) 2017 October 2022 10,000 $1.40 (14) 2017 May 2023 1,962,857 $1.63 6,197,681 (1) These warrants were issued in connection with an offering which was completed in January 2013. (2) These warrants were issued in connection with a private placement which was completed in October 2014. (3) These warrants were issued in connection with an offering which was completed in February 2015. (4) These warrants were issued in connection with an offering which was completed in July 2015. (5) These warrants were originally issued in connection with an offering in July 2015, and were amended in connection with an offering which was completed in January 2016. (6) These warrants were issued in connection with an offering which was completed in January 2016. (7) These warrants were issued in connection with the Merger and are the 2017 New Bridge Warrants discussed above. (8) These warrants were issued in connection with the Merger and are the Side Warrants discussed above. (9) These warrants were issued in connection with the August 2017 Offering and are the August 2017 Offering Warrants discussed above. (10) These warrants were issued in connection with the August 2017 Offering and are the Representative Warrants discussed above. (11) These warrants were issued in connection with the conversion of our Series A Senior stock, at the time of the closing of the August 2017 Offering, and are the Series A Conversion Warrants discussed above. (12) These warrants were issued in connection with the conversion of convertible bridge notes, at the time of the closing of the August 2017 Offering, and are the Note Conversion Warrants discussed above. (13) These warrants were issued in connection with the waiver of default the Company received in the fourth quarter of 2017 in connection with the Convertible Promissory Notes and are the Convertible Promissory Note Warrants discussed above. (14) These warrants were issued in connection with the Series C Preferred Offering and are the Series C Warrants discussed above. |
FAIR VALUE (Tables)
FAIR VALUE (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
FAIR VALUE [Abstract] | |
Schedule of Changes in Fair Value of Liability | During the year ended December 31, 2017, the change in the fair value of the liability measured using significant unobservable inputs (Level 3) were comprised of the following: Dollars in Thousands For the Year Ended December 31, 2017 Beginning balance at January 1 $ — Additions - liability assumed in the Merger 615 Total (gains) or losses: Recognized in earnings 226 Balance at December 31 $ 841 |
EQUITY INCENTIVE PLAN (Tables)
EQUITY INCENTIVE PLAN (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
EQUITY INCENTIVE PLAN [Abstract] | |
Summary of stock option activity | The following table summarizes stock option activity under our plans during the year ended December 31, 2017: Number of Options Weighted-Average Exercise Price Outstanding at January 1, 2017 24,600 $ 107.83 Granted 232,332 1.85 Forfeited (20,448 ) 68.39 Outstanding at December 31, 2017 236,484 $ 7.12 Exercisable at December 31, 2017 13,161 $ 93.27 |
NET SALES SERVICE REVENUE AND34
NET SALES SERVICE REVENUE AND ACCOUNTS RECEIVABLE (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Net Sales Service Revenue and Accounts Receivable [Abstract] | |
Schedule Of Sales | The following table summarizes service revenue, net of contractual allowances, for the years ended December 31, 2017 and 2016: 2017 2016 Service revenue $ 2,565 $ 3,385 Less: contractual allowances and adjustments (863 ) (1,284 ) Service revenue, net $ 1,702 $ 2,101 The following summarizes by payer type for the years ended December 31, 2017 and 2016: 2017 2016 Medicaid $ 39 $ 25 Medicare 569 688 Self-pay 103 253 Third party payers 500 1,135 Contract diagnostic services 491 — $ 1,702 $ 2,101 |
Schedule of Receivables | The following summarizes the mix of receivables for the years ended December 31, 2017 and 2016: 2017 2016 Medicaid $ 37 $ 22 Medicare 256 232 Self-pay 53 63 Third party payers 1,066 881 Contract diagnostic services 445 — Other — — $ 1,857 1,198 Less allowance for doubtful accounts (1,127 ) (810 ) Accounts receivable, net $ 730 $ 388 |
BUSINESS DESCRIPTION (Narrative
BUSINESS DESCRIPTION (Narrative) (Details) | Mar. 28, 2018USD ($) | Mar. 21, 2018USD ($)$ / shares | Mar. 12, 2018USD ($) | Feb. 20, 2018USD ($) | Feb. 12, 2018USD ($)shares | Jan. 08, 2018USD ($) | Jan. 08, 2018USD ($) | Jun. 29, 2017$ / shares | Aug. 31, 2017USD ($)shares | Feb. 28, 2018USD ($)shares | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Nov. 30, 2017$ / shares | Jun. 30, 2016$ / shares |
Business Acquisition [Line Items] | ||||||||||||||
Stock split and reverse stock split | 0.033 | |||||||||||||
Net loss | $ 20,694,000 | $ 2,227,000 | ||||||||||||
Accumulated Net Income (Loss) | (20,700,000) | |||||||||||||
Working deficiency | 8,300,000 | |||||||||||||
Net cash used in operating activities | (6,690,000) | $ (959,000) | ||||||||||||
Issuance of warrants | $ 84,000,000 | 7,784,000 | ||||||||||||
New shares issued (in shares) | shares | 22,518 | |||||||||||||
Warrants, exercise price per share | $ / shares | $ 0 | |||||||||||||
Crede [Member] | ||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||
Loss contingency, damages sought | $ 2,200,000 | |||||||||||||
Common Stock [Member] | ||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||
Warrants, exercise price per share | $ / shares | $ 7.50 | |||||||||||||
Series C Preferred Stock [Member] | ||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||
Warrants, exercise price per share | $ / shares | $ 1.63 | |||||||||||||
Subsequent Events [Member] | ||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||
Equity Purchase Agreement, Value | $ 8,000,000 | |||||||||||||
Issuance of warrants | $ 1,900,000 | $ 709,000 | ||||||||||||
New shares issued (in shares) | shares | 1,814,754 | 721,153 | ||||||||||||
Subsequent Events [Member] | Crede Capital Group LLC [Member] | ||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||
Loss contingency, damages sought | $ 1,800,000 | $ 2,200,000 | ||||||||||||
Litigation settlement in favor of other party, amount | $ 1,925,000 | |||||||||||||
Subsequent Events [Member] | Convertible Preferred Stock [Member] | ||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||
Proceeds from issuance of warrants | $ 200,000 | $ 200,000 | ||||||||||||
Warrants, exercise price per share | $ / shares | $ 0.75 | |||||||||||||
Connecticut Department of Economic and Community Development Laon [Member] | Subsequent Events [Member] | ||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||
Proceeds from Grantors | $ 100,000 | $ 100,000 | ||||||||||||
Secured debt | 300,000 | 300,000 | ||||||||||||
Proceeds from grants and issuance of debt | $ 400,000 | $ 400,000 | ||||||||||||
Debt instrument, term | 10 years | |||||||||||||
Transgenomics [Member] | ||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||
Merger transaction, effective date | Jun. 29, 2017 | |||||||||||||
Merger transaction, agrement date | Oct. 12, 2016 | |||||||||||||
Merger transaction, name of acquired entity | Precipio Diagnostics, LLC, a privately held Delaware limited liability company | |||||||||||||
Merger transaction, reverse stock split description | effected a 1-for-30 reverse stock split of its common stock | |||||||||||||
Stock split and reverse stock split | 30 | |||||||||||||
Merger transaction, pre-reverse stock split exchange ratio | 10.2502 |
SUMMARY OF SIGNIFICANT ACCOUN36
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Narrative) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | |
Finite-Lived Intangible Assets [Line Items] | |||
Impairment of goodwill | $ 9,300,000 | $ 9,315,000 | |
Other current assets | 430,000 | 430,000 | $ 13,000 |
Prepaid Insurance | 200,000 | 200,000 | |
Current prepaid expense | 100,000 | 100,000 | |
Other current receivables | 100,000 | 100,000 | |
Increase (decrease) in deferred debt issuance costs | 1,800,000 | ||
Net debt issuance costs and debt discounts | 0 | 0 | 65,048 |
Accumuated amortization of debt issuance costs | 0 | 0 | 87,342 |
Depreciation expense | 100,000 | 100,000 | |
Amortization expense of converted debt issuance costs | $ 1,900,000 | 32,662 | |
Share-based compensation arrangement by share-based payment award, expiration period | 10 years | ||
Deferred revenue | $ 66,000 | $ 66,000 | 92,000 |
Advertising expense | 8,300 | 12,900 | |
Reseach and development expense | 500,000 | $ 0 | |
In-Process Research and Development [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Impairment of intangible assets | $ 0 | ||
Maximum [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Stock options, unvested options, vesting period | 4 years |
SUMMARY OF SIGNIFICANT ACCOUN37
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Estimated Useful Lives of Property and Equipment) (Details) | 12 Months Ended |
Dec. 31, 2017 | |
Furniture and Fixtures [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 5 years |
Furniture and Fixtures [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 7 years |
Laboratory Equipment [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 3 years |
Laboratory Equipment [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 9 years |
Computer Equipment and Software [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 3 years |
Computer Equipment and Software [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 7 years |
Equipment Under Capital Leases [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 5 years |
Equipment Under Capital Leases [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 10 years |
SUMMARY OF SIGNIFICANT ACCOUN38
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Outstanding Securities not Included in the Computation of Diluted Net Loss) (Details) - shares | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Securities not included in the computation of diluted net loss per share | 9,960,890 | 2,754,593 |
Stock Options [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Securities not included in the computation of diluted net loss per share | 236,484 | 3,430 |
Warrants [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Securities not included in the computation of diluted net loss per share | 6,197,681 | 1,971,058 |
Preferred Stock [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Securities not included in the computation of diluted net loss per share | 3,525,000 | 780,105 |
Convertible Notes [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Securities not included in the computation of diluted net loss per share | 1,725 |
REVERSE MERGER (Narrative) (Det
REVERSE MERGER (Narrative) (Details) - USD ($) | Jun. 29, 2017 | Aug. 31, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | Dec. 31, 2017 |
Business Combination Segment Allocation [Line Items] | |||||
Number of shares converted (in shares) | 1,735,419 | ||||
Shares converted, value | $ 3,000,000 | $ 433,000 | |||
New shares issued (in shares) | 22,518 | ||||
Common stock, shares outstanding (in shares) | 449,175 | 10,196,620 | |||
Preferred stock, dividend rate (percentage) | 8.00% | ||||
Convertible Debt [Member] | |||||
Business Combination Segment Allocation [Line Items] | |||||
Debt instrument, face amount | $ 800,000 | ||||
Private Placement | |||||
Business Combination Segment Allocation [Line Items] | |||||
New shares issued (in shares) | 107,056 | ||||
Consideration received | $ 400,000 | ||||
Common Stock [Member] | |||||
Business Combination Segment Allocation [Line Items] | |||||
Number of shares converted (in shares) | 5,352,847 | ||||
Number of shares converted from debt instrument (in shares) | 1,414,700 | ||||
Preferred Stock [Member] | |||||
Business Combination Segment Allocation [Line Items] | |||||
Number of shares converted (in shares) | 7,155 | ||||
Number of shares converted from debt instrument (in shares) | 802,920 | ||||
Share price (in dollars per share) | $ 12.20 | ||||
Preferred Stock [Member] | Private Placement | |||||
Business Combination Segment Allocation [Line Items] | |||||
New shares issued (in shares) | 107,056 | ||||
Transgenomics [Member] | |||||
Business Combination Segment Allocation [Line Items] | |||||
Merger transaction, effective date | Jun. 29, 2017 | ||||
Conversion of debt into stock | $ 3,000,000 | ||||
Stock price used for estimating purchase consideration (in dollars per share) | $ 6.80 | ||||
Common stock, shares outstanding (in shares) | 895,334 | ||||
Preferred stock, dividend rate (percentage) | 8.00% | ||||
Transgenomics [Member] | Common Stock [Member] | |||||
Business Combination Segment Allocation [Line Items] | |||||
Number of shares converted from debt instrument (in shares) | 352,630 | ||||
Conversion of debt into stock | $ 3,000,000 | ||||
Transgenomics [Member] | Preferred Stock [Member] | |||||
Business Combination Segment Allocation [Line Items] | |||||
Number of shares converted (in shares) | 7,155 | ||||
Number of shares converted from debt instrument (in shares) | 802,925 | ||||
Conversion of debt into stock | $ 3,000,000 |
REVERSE MERGER (Schedule of Bus
REVERSE MERGER (Schedule of Business Acquisition) (Details) - Transgenomics [Member] - USD ($) $ in Thousands | Jun. 29, 2017 | Jun. 29, 2017 |
Business Acquisition [Line Items] | ||
Legacy Transgenomic common stock | $ 419 | $ 6,088 |
Fair value of preferred stock converted to common stock | 29 | 49 |
Fair value of debt converted to common stock | 14,000 | 2,398 |
Fair value of debt converted to preferred stock | 21,100 | 9,796 |
Fair value of existing bridge notes | 35,548 | 1,275 |
Fair value of warrants | 13,423 | 1,996 |
Purchase consideration | $ 523 | $ 21,602 |
REVERSE MERGER (Identifiable Ta
REVERSE MERGER (Identifiable Tangible and Intangible Assets Acquired) (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Jun. 29, 2017 |
Business Acquisition [Line Items] | ||
Goodwill | $ 4,685 | |
Transgenomics [Member] | ||
Business Acquisition [Line Items] | ||
Current and other assets | $ 419 | |
Property and equipment | 29 | |
Goodwill | 14,000 | |
Other intangible assets | 21,100 | |
Total assets | 35,548 | |
Current liabilities | 13,423 | |
Other liabilities | 523 | |
Total liabilities | 13,946 | |
Net assets acquired | 21,602 | |
Total intangibles | 21,100 | |
Acquired technology | Transgenomics [Member] | ||
Business Acquisition [Line Items] | ||
Other intangible assets | 18,990 | |
Total intangibles | 18,990 | |
Customer Relationships [Member] | Transgenomics [Member] | ||
Business Acquisition [Line Items] | ||
Other intangible assets | 250 | |
Total intangibles | 250 | |
Covenants not to Compete [Member] | Transgenomics [Member] | ||
Business Acquisition [Line Items] | ||
Other intangible assets | 30 | |
Total intangibles | 30 | |
Backlog [Member] | Transgenomics [Member] | ||
Business Acquisition [Line Items] | ||
Other intangible assets | 200 | |
Total intangibles | 200 | |
In-Process Research and Development [Member] | Transgenomics [Member] | ||
Business Acquisition [Line Items] | ||
Other intangible assets | 1,590 | |
Total intangibles | 1,590 | |
Trademark and trade name | Transgenomics [Member] | ||
Business Acquisition [Line Items] | ||
Other intangible assets | 40 | |
Total intangibles | $ 40 |
REVERSE MERGER (Pro-forma Discl
REVERSE MERGER (Pro-forma Disclosures) (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
REVERSE MERGER [Abstract] | ||
Net sales | $ 2,687 | $ 3,280 |
Net loss available to common stockholders | $ (37,389) | $ (11,215) |
Loss per common share (in dollars per share) | $ (4.95) | $ (1.70) |
PROPERTY AND EQUIPMENT (Summary
PROPERTY AND EQUIPMENT (Summary of Property and Equipment) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 908 | $ 733 |
Less-accumulated depreciation and amortization | (555) | (453) |
Property, Plant and Equipment, Net, Total | 353 | 280 |
Depreciation | 100 | 100 |
Furniture and Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 9 | 9 |
Laboratory Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 181 | 153 |
Computer Equipment and Software [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 307 | 275 |
Equipment Under Capital Leases [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 296 | $ 296 |
Construction in Progress [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 115 |
INTANGIBLES (Narrative) (Detail
INTANGIBLES (Narrative) (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2017USD ($) | |
Finite-Lived Intangible Assets [Line Items] | |
Amortization expense for intangible assets | $ 0.6 |
Amortization expense, next twelve months | 1.2 |
Amortization expense, 2019 | 1 |
Amortization expense, 2020 | 1 |
Amortization expense, 2021 | 0.9 |
Amortization expense, 2022 | 0.9 |
In-Process Research and Development [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Impairment of finite lived intangible asset | $ 0 |
INTANGIBLES (Schedule of Intang
INTANGIBLES (Schedule of Intangible Assets) (Details) $ in Thousands | Dec. 31, 2017USD ($) |
Finite-Lived Intangible Assets, Net [Abstract] | |
Cost | $ 21,100 |
Accumulated Amortization | 642 |
Net Book Value | 20,458 |
Technology [Member] | |
Finite-Lived Intangible Assets, Net [Abstract] | |
Cost | 18,990 |
Accumulated Amortization | 475 |
Net Book Value | 18,515 |
Customer Relationships [Member] | |
Finite-Lived Intangible Assets, Net [Abstract] | |
Cost | 250 |
Accumulated Amortization | 42 |
Net Book Value | 208 |
Backlog [Member] | |
Finite-Lived Intangible Assets, Net [Abstract] | |
Cost | 200 |
Accumulated Amortization | 100 |
Net Book Value | 100 |
Covenants not to Compete [Member] | |
Finite-Lived Intangible Assets, Net [Abstract] | |
Cost | 30 |
Accumulated Amortization | 15 |
Net Book Value | 15 |
Trademark [Member] | |
Finite-Lived Intangible Assets, Net [Abstract] | |
Cost | 40 |
Accumulated Amortization | 10 |
Net Book Value | 30 |
In-Process Research and Development [Member] | |
Finite-Lived Intangible Assets, Net [Abstract] | |
Cost | 1,590 |
Net Book Value | $ 1,590 |
INTANGIBLES (Intangible Assets,
INTANGIBLES (Intangible Assets, Estimated Useful Life) (Details) | 12 Months Ended |
Dec. 31, 2017 | |
Technology [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Intangible assets, estimated useful life | 20 years |
Customer Relationships [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Intangible assets, estimated useful life | 3 years |
Backlog [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Intangible assets, estimated useful life | 1 year |
Covenants not to Compete [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Intangible assets, estimated useful life | 1 year |
Trademark [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Intangible assets, estimated useful life | 2 years |
LONG-TERM DEBT (Schedule of Deb
LONG-TERM DEBT (Schedule of Debt) (Details) - USD ($) | Dec. 31, 2017 | Oct. 31, 2017 | Aug. 17, 2017 | Jun. 29, 2017 | Dec. 31, 2016 |
Debt Instrument [Line Items] | |||||
Total debt | $ 3,416,000 | $ 4,522,000 | |||
Current portion of long-term debt | (587,000) | (395,000) | |||
Long-term debt, net of current maturities | 2,829,000 | 4,127,000 | |||
Department of Economic and Community Development (DECD) | |||||
Debt Instrument [Line Items] | |||||
Total debt | 0 | 243,287 | |||
Debt issuance cost | (30,000) | ||||
Webster Bank | |||||
Debt Instrument [Line Items] | |||||
Total debt | 0 | 328,000 | |||
Debt issuance cost | (26,000) | ||||
Financed Insurance Loan [Member] | |||||
Debt Instrument [Line Items] | |||||
Total debt | 183,000 | ||||
Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Total debt | $ 3,584,968 | 3,269,968 | |||
Debt issuance cost | (9,000) | ||||
Junior Notes | |||||
Debt Instrument [Line Items] | |||||
Total debt | $ 583,821 | 583,821 | |||
Convertible Debt [Member] | |||||
Debt Instrument [Line Items] | |||||
Total debt | $ 41,666 | $ 143,041 | |||
Secured Debt [Member] | |||||
Debt Instrument [Line Items] | |||||
Total debt | 3,200,000 | ||||
Line of credit | |||||
Debt Instrument [Line Items] | |||||
Total debt | $ 0 | $ 162,066 |
LONG-TERM DEBT (Senior and Juni
LONG-TERM DEBT (Senior and Junior Notes) (Details) - USD ($) | Jun. 29, 2017 | Apr. 28, 2017 | Aug. 31, 2017 | Jul. 31, 2017 | Dec. 31, 2017 | Dec. 31, 2016 |
Debt Instrument [Line Items] | ||||||
Proceeds from long-term debt | $ 315,000 | $ 525,000 | ||||
Preferred stock issued, value | 8,000 | |||||
Total debt | 3,416,000 | 4,522,000 | ||||
Convertible Preferred Stock [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Equity instrument fair value | 2,147,716 | |||||
Preferred stock issued, value | 1,715,000 | |||||
Stock dividend, value | 432,716 | |||||
Preferred Stock [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Conversion of debt into stock (in shares) | 802,920 | |||||
Common Stock [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Equity instrument fair value | $ 2,200,000 | |||||
Conversion of debt into stock (in shares) | 1,414,700 | |||||
Bridge Loan [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Convertible debt | 1,120,000 | |||||
Accrued interest | $ 36,551 | 61,073 | ||||
Debt instrument, face amount | 2,000,000 | |||||
Total debt | $ 2,436,551 | |||||
Bridge Loan [Member] | Common Stock [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Conversion of debt into stock (in shares) | 359,999 | 359,999 | 359,999 | |||
Senior Notes | ||||||
Debt Instrument [Line Items] | ||||||
Proceeds from long-term debt | $ 315,000 | $ 525,000 | ||||
Annual interest rate (as a percent) | 12.00% | 12.00% | ||||
Accrued interest | $ 279,740 | |||||
Total debt | $ 3,584,968 | 3,269,968 | ||||
Senior Notes | Bridge Loan [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument, face amount | 2,744,968 | |||||
Junior Notes | ||||||
Debt Instrument [Line Items] | ||||||
Annual interest rate (as a percent) | 15.00% | |||||
Accrued interest | 71,258 | |||||
Debt instrument, face amount | 583,821 | |||||
Total debt | 583,821 | $ 583,821 | ||||
Senior and Junior Notes [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Accrued interest | $ 602,373 |
LONG-TERM DEBT (Connecticut Inn
LONG-TERM DEBT (Connecticut Innovations, Incorporated) (Details) - USD ($) | 10 Months Ended | 12 Months Ended | |
Oct. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2017 | |
Debt Instrument [Line Items] | |||
Total debt | $ 4,522,000 | $ 3,416,000 | |
Line of credit | |||
Debt Instrument [Line Items] | |||
Maximum borrowing amount | $ 500,000 | ||
Interest rate (as a percent) | 8.00% | ||
Debt instrument, scheduled payment, interest | $ 1,041 | ||
Total debt | 162,066 | $ 0 | |
Minimum [Member] | Line of credit | |||
Debt Instrument [Line Items] | |||
Debt instrument, scheduled periodic payments | 7,436 | ||
Maximum [Member] | Line of credit | |||
Debt Instrument [Line Items] | |||
Debt instrument, scheduled periodic payments | $ 12,206 |
LONG-TERM DEBT (Department of E
LONG-TERM DEBT (Department of Economic and Community Development) (Details) - USD ($) | Jul. 02, 2017 | Dec. 31, 2017 | Dec. 31, 2016 |
Debt Instrument [Line Items] | |||
Total debt | $ 3,416,000 | $ 4,522,000 | |
Department of Economic and Community Development (DECD) | |||
Debt Instrument [Line Items] | |||
Debt instrument, term | 10 years | ||
Debt instrument, face amount | $ 300,000 | ||
Interest rate (as a percent) | 3.00% | ||
Total debt | $ 0 | $ 243,287 | |
Repayments of long term debt | $ 225,714 |
LONG-TERM DEBT (Webster Bank) (
LONG-TERM DEBT (Webster Bank) (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Debt Instrument [Line Items] | ||
Total debt | $ 3,416,000 | $ 4,522,000 |
Loss on extinguishment of debt and induced conversion of convertible bridge notes | $ 1,391,000 | |
Webster Bank | ||
Debt Instrument [Line Items] | ||
Debt instrument, term | 3 years 6 months | |
Debt instrument, face amount | $ 500,000 | |
Interest rate (as a percent) | 1.16% | |
Variable rate on spread | 5.00% | |
Total debt | $ 0 | $ 328,000 |
Connecticut, DECD and Webster Loan | ||
Debt Instrument [Line Items] | ||
Loss on extinguishment of debt and induced conversion of convertible bridge notes | $ 53,000 |
LONG-TERM DEBT (Secured Debt Ob
LONG-TERM DEBT (Secured Debt Obligations) (Details) - USD ($) $ / shares in Units, $ in Thousands | Feb. 12, 2018 | Aug. 31, 2017 | Feb. 28, 2018 | Dec. 31, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Jun. 30, 2016 |
Debt Instrument [Line Items] | |||||||
Total debt | $ 3,416 | $ 3,416 | $ 4,522 | ||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 6,197,681 | 6,197,681 | 1,958,166 | ||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 0 | ||||||
Stock Issued During Period, Shares, New Issues | 22,518 | ||||||
Stock and Warrants Issued During Period, Value, Preferred Stock and Warrants | $ 84,000 | $ 7,784 | |||||
Liability for Share Settlement | 1,900 | ||||||
Gains (Losses) on Restructuring of Debt | 1,181 | ||||||
Creditor Group Two [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Gains (Losses) on Restructuring of Debt | $ 200 | ||||||
Creditor Warrants Relating to Secured Debt [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 108,112 | 108,112 | |||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 7.50 | $ 7.50 | |||||
Warrants and Rights Outstanding | $ 158 | $ 158 | |||||
Class of Warrant or Right, Term | 5 years | ||||||
Subsequent Events [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Stock Issued During Period, Shares, New Issues | 1,814,754 | 721,153 | |||||
Stock and Warrants Issued During Period, Value, Preferred Stock and Warrants | $ 1,900 | $ 709 | |||||
Subsequent Events [Member] | Secured Debt [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Other Accounts Payable and Accrued Liabilities | 1,100 | ||||||
Secured Debt [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate (as a percent) | 10.00% | 10.00% | |||||
Total debt | $ 3,200 | $ 3,200 | |||||
Debt Instrument, Periodic Payment | $ 65 | ||||||
Share Price | $ 1.04 | $ 1.04 | |||||
Debt Restructured | $ 6,300 | ||||||
Secured Debt [Member] | Creditor Group One [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Gains (Losses) on Restructuring of Debt | $ 1,200 | ||||||
Secured Debt [Member] | Creditor Warrants Relating to Secured Debt [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Debt Restructured | 1,300 | ||||||
Secured Debt [Member] | Settlement Agreements [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Total debt | 3,200 | 3,200 | |||||
Warrants and Rights Outstanding | 1,900 | 1,900 | |||||
Fair value of warrants and shares | 200 | ||||||
Gain on troubled debt restructuring | 1,200 | ||||||
Gain (loss) on extinguishment of debt | (200) | ||||||
Interest Expense, Debt | 600 | ||||||
Extinguishment of Debt, Amount | 1,900 | ||||||
Other Accounts Payable and Accrued Liabilities | $ 5,200 | $ 5,200 | |||||
Stock Issued During Period, Shares, New Issues | 1,814,754 | ||||||
Secured Debt [Member] | Subsequent Events [Member] | Creditor Group One [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Debt Restructured | $ 1,300 |
LONG-TERM DEBT (Convertible Pro
LONG-TERM DEBT (Convertible Promissory Notes) (Details) - USD ($) | Aug. 31, 2017 | Dec. 31, 2017 | Oct. 31, 2017 | Aug. 17, 2017 | Dec. 31, 2016 | Jun. 30, 2016 |
Debt Instrument [Line Items] | ||||||
Total debt | $ 3,416,000 | $ 4,522,000 | ||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 6,197,681 | 1,958,166 | ||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 0 | |||||
Convertible Promissory Note Warrants [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 10,000 | 10,000 | ||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 3 | $ 1.40 | ||||
Convertible Debt [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument, face amount | $ 125,000 | |||||
Interest rate (as a percent) | 6.00% | |||||
Total debt | $ 41,666 | $ 143,041 | ||||
Accrued interest | $ 20,000 | $ 18,041 | ||||
Repayments of long term debt | $ 83,333 |
LONG-TERM DEBT (Aggregate Futur
LONG-TERM DEBT (Aggregate Future Maturities on Long-Term Debt) (Details) $ in Thousands | Dec. 31, 2017USD ($) |
Debt Instrument [Line Items] | |
2,018 | $ 587 |
2,019 | 809 |
2,020 | 808 |
2,021 | 808 |
2,022 | 404 |
Total | 3,416 |
Secured Debt [Member] | |
Debt Instrument [Line Items] | |
2,018 | 404 |
2,019 | 809 |
2,020 | 808 |
2,021 | 808 |
2,022 | 404 |
Total | 3,233 |
Financed Insurance Loan [Member] | |
Debt Instrument [Line Items] | |
2,018 | 183 |
Total | $ 183 |
CONVERTIBLE BRIDGE NOTES (Conve
CONVERTIBLE BRIDGE NOTES (Convertible Bridge Notes) (Details) - USD ($) | Jun. 29, 2017 | Jun. 29, 2017 | Apr. 28, 2017 | Aug. 31, 2017 | Jul. 31, 2017 | Dec. 31, 2017 | Dec. 31, 2016 |
Short-term Debt [Line Items] | |||||||
Total debt | $ 3,416,000 | $ 4,522,000 | |||||
Common Stock [Member] | |||||||
Short-term Debt [Line Items] | |||||||
Conversion of debt into stock (in shares) | 1,414,700 | ||||||
Bridge Loan [Member] | |||||||
Short-term Debt [Line Items] | |||||||
Total debt | $ 2,436,551 | ||||||
Conversion of debt into stock | 900,000 | $ 900,000 | $ 900,000 | 1,787,000 | |||
Accrued interest | $ 36,551 | 61,073 | |||||
Bridge Loan [Member] | Common Stock [Member] | |||||||
Short-term Debt [Line Items] | |||||||
Conversion of debt into stock (in shares) | 359,999 | 359,999 | 359,999 | ||||
Bridge Loan [Member] | Convertible Bridge Loan | |||||||
Short-term Debt [Line Items] | |||||||
Total debt | $ 0 | $ 695,000 | |||||
Interest rate (as a percent) | 14.00% | ||||||
Bridge Loan [Member] | Convertible Bridge Loan | Series C Preferred Stock [Member] | |||||||
Short-term Debt [Line Items] | |||||||
Conversion of stock, discount rate | 30.00% | ||||||
Bridge Loan [Member] | Convertible Bridge Loan | Series B Preferred Stock [Member] | |||||||
Short-term Debt [Line Items] | |||||||
Conversion of stock, discount rate | 30.00% | ||||||
Debt instrument, debt converted into new debt | 70.00% | ||||||
Bridge Loan [Member] | Convertible Bridge Loan | Common Stock [Member] | |||||||
Short-term Debt [Line Items] | |||||||
Conversion of debt into stock | $ 695,000 | ||||||
Accrued interest | $ 192,000 | $ 192,000 | |||||
Conversion of debt into stock (in shares) | 155,639 |
CONVERTIBLE BRIDGE NOTES (2017
CONVERTIBLE BRIDGE NOTES (2017 New Bridge Notes I) (Details) - USD ($) | Jun. 29, 2017 | Jun. 28, 2017 | Dec. 31, 2017 | Aug. 31, 2017 | Jun. 30, 2017 | Apr. 28, 2017 | Jun. 30, 2016 |
Short-term Debt [Line Items] | |||||||
Underlying shares (in shares) | 6,197,681 | 1,958,166 | |||||
Exercise price (in dollars per share) | $ 0 | ||||||
Warrants, fair value | $ 211,000 | $ 1,421,738 | |||||
Common Stock [Member] | |||||||
Short-term Debt [Line Items] | |||||||
Underlying shares (in shares) | 45,600 | ||||||
Exercise price (in dollars per share) | $ 7.50 | ||||||
Percentage of per share offering price | 110.00% | ||||||
Common Stock [Member] | Minimum [Member] | |||||||
Short-term Debt [Line Items] | |||||||
Exercise price (in dollars per share) | $ 1.50 | ||||||
Precipio Diagnostic [Member] | |||||||
Short-term Debt [Line Items] | |||||||
Loans to related party | $ 561,500 | ||||||
2017 Bridge Notes [Member] | |||||||
Short-term Debt [Line Items] | |||||||
Warrants, fair value | $ 211,000 | ||||||
2017 Bridge Notes [Member] | Common Stock [Member] | |||||||
Short-term Debt [Line Items] | |||||||
Exercise price (in dollars per share) | $ 2.75 | ||||||
New Bridge Notes I | Common Stock [Member] | |||||||
Short-term Debt [Line Items] | |||||||
Exercise price (in dollars per share) | $ 7.50 | ||||||
Bridge Loan [Member] | |||||||
Short-term Debt [Line Items] | |||||||
Premium rate changed upon settlement of debt | 20.00% | ||||||
Debt instrument, face amount | $ 2,000,000 | ||||||
Bridge Loan [Member] | Common Stock [Member] | |||||||
Short-term Debt [Line Items] | |||||||
Underlying shares (in shares) | 45,600 | ||||||
Exercise price (in dollars per share) | $ 1.40 | $ 3 | $ 7.50 | ||||
Conversion price (in dollars per share) | $ 2.50 | ||||||
Percentage of per share offering price | 110.00% | ||||||
Bridge Loan [Member] | New Bridge Notes I | |||||||
Short-term Debt [Line Items] | |||||||
Sale of debt | $ 1,200,000 | ||||||
Interest rate (as a percent) | 8.00% | ||||||
Premium rate changed upon settlement of debt | 20.00% | ||||||
Debt instrument, face amount | $ 1,200,000 | ||||||
Conversion price (in dollars per share) | $ 3.736329 | ||||||
Premium on debt settlement | $ 240,000 | ||||||
Discount on debt | $ 989,000 | ||||||
Transgenomics [Member] | Common Stock [Member] | |||||||
Short-term Debt [Line Items] | |||||||
Underlying shares (in shares) | 40,000 | 40,000 | |||||
Exercise price (in dollars per share) | $ 15 | $ 15 | |||||
Agent Fees | $ 84,000 | ||||||
Transgenomics [Member] | Aegis Warrants | |||||||
Short-term Debt [Line Items] | |||||||
Underlying shares (in shares) | 5,600 | ||||||
Transgenomics [Member] | Aegis Warrants | Common Stock [Member] | |||||||
Short-term Debt [Line Items] | |||||||
Underlying shares (in shares) | 5,600 | ||||||
Exercise price (in dollars per share) | $ 15 | $ 15 | |||||
Transgenomics [Member] | Bridge Loan [Member] | 2017 Bridge Notes [Member] | |||||||
Short-term Debt [Line Items] | |||||||
Sale of debt | $ 1,200,000 | ||||||
Interest rate (as a percent) | 4.00% | ||||||
Debt instrument, term | 90 days | ||||||
Premium rate changed upon settlement of debt | 20.00% |
CONVERTIBLE BRIDGE NOTES (20157
CONVERTIBLE BRIDGE NOTES (2017 New Bridge Notes II) (Details) - USD ($) | Jun. 29, 2017 | Dec. 31, 2017 | Aug. 31, 2017 | Jun. 30, 2017 | Apr. 28, 2017 | Dec. 31, 2016 | Jun. 30, 2016 |
Short-term Debt [Line Items] | |||||||
Underlying shares (in shares) | 6,197,681 | 1,958,166 | |||||
Exercise price (in dollars per share) | $ 0 | ||||||
Warrants, fair value | $ 211,000 | $ 1,421,738 | |||||
Merger advisory fees | $ 2,676,000 | ||||||
Proceeds from equity financing | 7,000,000 | ||||||
Total debt | $ 3,416,000 | $ 4,522,000 | |||||
Upon Execution | |||||||
Short-term Debt [Line Items] | |||||||
Underlying shares (in shares) | 22,857 | ||||||
Performance Based | |||||||
Short-term Debt [Line Items] | |||||||
Underlying shares (in shares) | 68,572 | ||||||
Side Warrants [Member] | |||||||
Short-term Debt [Line Items] | |||||||
Underlying shares (in shares) | 91,429 | ||||||
Exercise price (in dollars per share) | $ 7 | ||||||
Warrants, fair value | $ 487,000 | ||||||
Class of warrant or right, term | 5 years | ||||||
Merger advisory fees | $ 487,000 | ||||||
Common Stock [Member] | |||||||
Short-term Debt [Line Items] | |||||||
Underlying shares (in shares) | 45,600 | ||||||
Exercise price (in dollars per share) | $ 7.50 | ||||||
Common Stock [Member] | Side Warrants [Member] | |||||||
Short-term Debt [Line Items] | |||||||
Underlying shares (in shares) | 91,429 | ||||||
Bridge Loan [Member] | |||||||
Short-term Debt [Line Items] | |||||||
Premium rate changed upon settlement of debt | 20.00% | ||||||
Total debt | $ 2,436,551 | ||||||
Bridge Loan [Member] | Common Stock [Member] | |||||||
Short-term Debt [Line Items] | |||||||
Conversion price (in dollars per share) | $ 2.50 | ||||||
Underlying shares (in shares) | 45,600 | ||||||
Exercise price (in dollars per share) | $ 1.40 | $ 3 | $ 7.50 | ||||
Bridge Loan [Member] | 2017 New Bridge Notes II | |||||||
Short-term Debt [Line Items] | |||||||
Sale of debt | $ 800,000 | ||||||
Proceeds from sale of debt instrument | $ 721,000 | ||||||
Interest rate (as a percent) | 8.00% | ||||||
Conversion price (in dollars per share) | $ 3.736329 | ||||||
Premium rate changed upon settlement of debt | 20.00% | ||||||
Premium on debt settlement | $ 160,000 | ||||||
Discount on debt | $ 656,000 |
CONVERTIBLE BRIDGE NOTES (Con58
CONVERTIBLE BRIDGE NOTES (Conversion and Settlement of New Bridge Notes) (Details) - USD ($) | Jun. 29, 2017 | Jun. 29, 2017 | Apr. 28, 2017 | Aug. 31, 2017 | Jul. 31, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Nov. 30, 2017 | Oct. 31, 2017 |
Debt Instrument [Line Items] | |||||||||
Total debt | $ 3,416,000 | $ 4,522,000 | |||||||
Loss on extinguishment of debt related to unamortized discount | 1,391,000 | ||||||||
Amortization of deferred financing costs and debt discount | 1,898,000 | 33,000 | |||||||
Bridge Loan [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Total debt | $ 2,436,551 | ||||||||
Debt instrument, face amount | 2,000,000 | ||||||||
Redemption premium | $ 400,000 | ||||||||
Premium rate changed upon settlement of debt | 20.00% | ||||||||
Accrued interest | $ 36,551 | 61,073 | |||||||
Repayments of debt | 1,536,551 | ||||||||
Debt converted | $ 900,000 | $ 900,000 | $ 900,000 | 1,787,000 | |||||
Loss on extinguishment of debt and induced conversion of convertible bridge notes | 1,000,000 | ||||||||
Loss on extinguishment of debt related to unamortized discount | 400,000 | ||||||||
Bridge Loan [Member] | Convertible Bridge Loan | |||||||||
Debt Instrument [Line Items] | |||||||||
Total debt | 0 | $ 695,000 | |||||||
Amortization of deferred financing costs and debt discount | $ 1,900,000 | ||||||||
Preferred Class B | |||||||||
Debt Instrument [Line Items] | |||||||||
Shares callable by warrant (in shares) | 400 | ||||||||
Share price (in dollars per share) | $ 1,000 | ||||||||
Proceeds from issuance of common stock | $ 6,000,000 | ||||||||
Conversion price (in dollars per share) | $ 2.50 | $ 1.40 | $ 2.50 | ||||||
Common Stock [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Shares callable by warrant (in shares) | 400 | ||||||||
Number of shares converted from debt instrument (in shares) | 1,414,700 | ||||||||
Common Stock [Member] | Bridge Loan [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Number of shares converted from debt instrument (in shares) | 359,999 | 359,999 | 359,999 | ||||||
Conversion price (in dollars per share) | $ 2.50 | ||||||||
Warrants issued on conversion (in shares) | 359,999 | ||||||||
Loss on extinguishment of debt and induced conversion of convertible bridge notes | $ 1,000,000 | ||||||||
Common Stock [Member] | Bridge Loan [Member] | Convertible Bridge Loan | |||||||||
Debt Instrument [Line Items] | |||||||||
Accrued interest | $ 192,000 | $ 192,000 | |||||||
Debt converted | $ 695,000 | ||||||||
Number of shares converted from debt instrument (in shares) | 155,639 | ||||||||
Public Stock Offering | |||||||||
Debt Instrument [Line Items] | |||||||||
Shares sold in offering (in shares) | 6,000 | ||||||||
Sale of stock, number of warrants per unit (in shares) | 1 | ||||||||
Public Stock Offering | Preferred Class B | |||||||||
Debt Instrument [Line Items] | |||||||||
Shares sold in offering (in shares) | 6,000 | ||||||||
Preferred Class B | |||||||||
Debt Instrument [Line Items] | |||||||||
Sale of stock, number of shares per unit (in shares) | 1 |
ACCRUED EXPENSES (Narrative) (D
ACCRUED EXPENSES (Narrative) (Details) - USD ($) $ in Thousands | Mar. 12, 2018 | Dec. 31, 2017 | Feb. 28, 2018 |
Reduction in Certain Accrued Expense and Accounts Payable | $ 1,100 | ||
Liability For Settlement Of Equity Instrument | 1,085 | ||
Derivative Liability | 841 | ||
Crede [Member] | |||
Liability For Settlement Common Shares Issued | 1,814,754 | ||
Liability For Settlement Fair Value Of Common Shares Issued | $ 1,900 | ||
Loss Contingency, Damages Sought, Value | $ 2,200 | ||
Settled Litigation [Member] | Crede [Member] | |||
Litigation Settlement, Amount Awarded to Other Party | $ 1,925 | ||
Liability For Settlement Payment Period | 16 months | ||
Loss Contingency, Loss in Period | $ 600 |
ACCRUED EXPENSES (Accrued Expen
ACCRUED EXPENSES (Accrued Expenses) (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Payables and Accruals [Abstract] | ||
Accrued expenses | $ 1,122 | $ 50 |
Accrued compensation | 126 | 155 |
Accrued interest | 495 | |
Accrued expenses | $ 1,248 | $ 700 |
ACCRUED EXPENSES (Other Current
ACCRUED EXPENSES (Other Current Liabilities) (Details) $ in Thousands | Dec. 31, 2017USD ($) |
Payables and Accruals [Abstract] | |
Obigation To Issue Common Shares | $ 1,897 |
Liability For Settlement Of Equity Instrument | 1,085 |
Other Liabilities, Current, Total | $ 2,982 |
COMMITMENTS AND CONTINGENCIES62
COMMITMENTS AND CONTINGENCIES (Narrative) (Details) - USD ($) | Mar. 21, 2018 | Mar. 12, 2018 | Feb. 20, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Feb. 06, 2017 | Jun. 30, 2016 |
Loss Contingencies [Line Items] | |||||||
Operating Leases, Rent Expense, Net | $ 200,000 | $ 100,000 | |||||
Capital Leases of Lessee, Intetrest Rate | 7.25% | ||||||
Amortization of Leased Asset | $ 48,000 | 45,000 | |||||
Loss Contingency Accrual, Daily Damages Saught | $ 3,737.32 | ||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 0 | ||||||
New Haven, Connecticut Operating Lease [Member] | Minimum [Member] | |||||||
Loss Contingencies [Line Items] | |||||||
Operating Leases, Rent Expense, Monthly | 13,400 | ||||||
New Haven, Connecticut Operating Lease [Member] | Maximum [Member] | |||||||
Loss Contingencies [Line Items] | |||||||
Operating Leases, Rent Expense, Monthly | 14,600 | ||||||
Omaha, Nebraska Operating Lease [Member] | Minimum [Member] | |||||||
Loss Contingencies [Line Items] | |||||||
Operating Leases, Rent Expense, Monthly | 2,300 | ||||||
Omaha, Nebraska Operating Lease [Member] | Maximum [Member] | |||||||
Loss Contingencies [Line Items] | |||||||
Operating Leases, Rent Expense, Monthly | 2,800 | ||||||
UNMC | |||||||
Loss Contingencies [Line Items] | |||||||
Loss contingency, damages sought | 700,000 | ||||||
Loss contingency accrual | 300,000 | 400,000 | $ 400,000 | ||||
Litigation Settlement, Installment Payment Amount | 25,000 | ||||||
Litigation Settlement, Installment Final Payment Amount | 100,000 | ||||||
Loss Contingency Accrual, Payments | 50,000 | ||||||
Fox Chase | Transgenomics [Member] | |||||||
Loss Contingencies [Line Items] | |||||||
Litigation settlement in favor of other party, amount | 175,000 | ||||||
Litigation Settlement, Installment Payment Amount | 60,000 | ||||||
Litigation Settlement, Installment Final Payment Amount | 55,000 | ||||||
IDT | |||||||
Loss Contingencies [Line Items] | |||||||
Litigation settlement in favor of other party, amount | 139,000 | ||||||
Payments for legal settlements | $ 139,000 | ||||||
Mount Sinai | |||||||
Loss Contingencies [Line Items] | |||||||
Loss contingency, damages sought | 700,000 | ||||||
Debt Instrument, Interest Rate, Stated Percentage | 10.00% | ||||||
Secured Debt | $ 500,000 | ||||||
Debt Instrument, Periodic Payment | $ 9,472 | ||||||
Class of Warrant or Right, Outstanding | 24,900 | ||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 7.50 | ||||||
Class of Warrant or Right, Term | 5 years | ||||||
Smith | |||||||
Loss Contingencies [Line Items] | |||||||
Loss contingency, damages sought | 2,200,000 | ||||||
Loss contingency accrual | $ 200,000 | ||||||
Litigation settlement in favor of other party, amount | 600,000 | ||||||
Loss Contingency Accrual, Payments | 400,000 | ||||||
XIFIN, Inc. | |||||||
Loss Contingencies [Line Items] | |||||||
Loss contingency, damages sought | 270,000 | ||||||
Loss contingency accrual | 200,000 | ||||||
Loss Contingency Accrual, Payments | 100,000 | ||||||
CPA Global | |||||||
Loss Contingencies [Line Items] | |||||||
Loss contingency, damages sought | 200,000 | ||||||
Loss contingency accrual | 100,000 | ||||||
Loss Contingency Accrual, Payments | 100,000 | ||||||
Edge Bio | |||||||
Loss Contingencies [Line Items] | |||||||
Loss contingency, damages sought | $ 100,000 | ||||||
Loss contingency accrual | 100,000 | ||||||
Litigation settlement in favor of other party, amount | 113,000,000 | ||||||
Litigation Settlement, Installment Payment Amount | 63,000,000 | ||||||
Litigation Settlement, Installment Final Payment Amount | $ 63,000,000 | ||||||
Crede Capital Group LLC [Member] | Subsequent Events [Member] | |||||||
Loss Contingencies [Line Items] | |||||||
Loss contingency, damages sought | $ 1,800,000 | 2,200,000 | |||||
Litigation settlement in favor of other party, amount | 1,925,000 | ||||||
Litigation Settlement, Installment Payment Amount | 175,000 | ||||||
Loss Contingency Accrual, Payments | 1,900,000 | ||||||
Crede Capital Group LLC [Member] | Transgenomics [Member] | Subsequent Events [Member] | |||||||
Loss Contingencies [Line Items] | |||||||
Loss contingency, damages sought | $ 2,200,000 | ||||||
Bio-Rad Laboratories [Member] | Subsequent Events [Member] | |||||||
Loss Contingencies [Line Items] | |||||||
Litigation settlement in favor of other party, amount | $ 39,000 | ||||||
Loss Contingency Accrual, Payments | $ 100,000 |
COMMITMENTS AND CONTINGENCIES63
COMMITMENTS AND CONTINGENCIES (Property Under Capital Leases) (Details) - Lab Equipment [Member] - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Lab equipment | $ 296,000 | $ 296,000 |
Less accumulated amortization | (150,000) | (102,000) |
Capital leases, net | $ 146,000 | $ 194,000 |
COMMITMENTS AND CONTINGENCIES64
COMMITMENTS AND CONTINGENCIES (Future Minimum Lease Payments Under Capital Leases) (Details) | Dec. 31, 2017USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2,018 | $ 60,000 |
2,019 | 60,000 |
2,020 | 36,000 |
2,021 | 24,000 |
2,022 | 4,000 |
Capital Leases, Future Minimum Payments Due | 184,000 |
Less: Amount representing interest | (21,000) |
Present value of net minimum lease obligations | 163,000 |
Current maturities of capital leases | (50,000) |
Capital leases, long term | $ 113,000 |
COMMITMENTS AND CONTINGENCIES65
COMMITMENTS AND CONTINGENCIES (Purchase Commitments) (Details) - Inventories [Member] | Dec. 31, 2017USD ($) |
2,018 | $ 209,000 |
2,019 | 208,000 |
2,020 | 138,000 |
2,021 | 99,000 |
2,022 | $ 10,000 |
COMMITMENTS AND CONTINGENCIES66
COMMITMENTS AND CONTINGENCIES (Other Commitments) (Details) | Dec. 31, 2017USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2,018 | $ 1,000,000 |
2,019 | 925,000 |
Total | $ 1,925,000 |
COMMITMENTS AND CONTINGENCIES67
COMMITMENTS AND CONTINGENCIES (Future Minimum Payments Under Operating Leases) (Details) | Dec. 31, 2017USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2,018 | $ 195,000 |
2,019 | 198,000 |
2,020 | 203,000 |
2,021 | 208,000 |
2,022 | 13,000 |
Total | $ 817,000 |
INCOME TAXES (Narrative) (Detai
INCOME TAXES (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 34.00% | ||
Income Tax Expense (Benefit), Continuing Operations, Adjustment of Deferred Tax (Asset) Liability | $ 1,000 | ||
Deferred Tax Assets, Net of Valuation Allowance | 1,300 | ||
Net deferred tax assets | 1,466 | $ 665 | |
Deferred Tax Assets, Valuation Allowance | 1,815 | 665 | |
Deferred Tax Liabilities, Deferred Expense, Capitalized Research and Development Costs | 349 | ||
Valuation Allowance, Deferred Tax Asset, Increase (Decrease), Amount | 1,100 | ||
Scenario, Plan [Member] | |||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 21.00% | ||
Internal Revenue Service (IRS) [Member] | |||
Operating Loss Carryforwards | $ 26,890 | $ 967 |
INCOME TAXES (Schedule of Defer
INCOME TAXES (Schedule of Deferred Tax Assets And Liabilities) (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Income Tax Disclosure [Abstract] | ||
Net operating loss and credit carryforwards | $ 5,907 | $ 407 |
Accrued interest | 2 | 164 |
Stock-based compensation | 61 | |
Other | 22 | 110 |
Gross deferred tax assets | 5,992 | 681 |
Property and equipment | (32) | |
Intangible assets | (4,145) | |
IPR&D intangible assets | (349) | |
Other | (16) | |
Gross deferred tax liabilities | (4,526) | (16) |
Net deferred tax assets | 1,466 | 665 |
Less valuation allowance | (1,815) | $ (665) |
Net deferred liability | $ (349) |
INCOME TAXES (Reconciliation of
INCOME TAXES (Reconciliation of the Provision for Income Taxes) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | ||
Benefit at federal rate | $ (7,331) | $ (421) |
State income taxes-net of federal benefit | (101) | (27) |
Miscellaneous permanent differences | 4 | 2 |
Warrant liability revaluation | 81 | |
Capitalized transaction cost | 958 | |
Impairment of goodwill | 3,334 | |
Enactment of Tax Cuts and Jobs Act | 1,041 | |
Change in valuation allowance | 2,014 | 446 |
Income Tax Expense (Benefit), Total |
INCOME TAXES (Schedule of Incom
INCOME TAXES (Schedule of Income Taxes by Jurisidciton) (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | ||
Current Federal | ||
Deferred Federal | ||
Total Federal | ||
Current State | ||
Deferred State | ||
Total State | ||
Current Foreign | ||
Deferred Foreign | ||
Total Foreign | ||
Income Tax Expense (Benefit), Total |
INCOME TAXES (Summary of Operat
INCOME TAXES (Summary of Operating Loss Carryforwards) (Details) - Internal Revenue Service (IRS) [Member] - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Operating Loss Carryforwards | $ 26,890 | $ 967 |
Tax Year 2036 [Member] | ||
Operating Loss Carryforwards | 17,781 | $ 967 |
Tax Year 2037 [Member] | ||
Operating Loss Carryforwards | $ 9,109 |
STOCKHOLDERS' EQUITY (DEFICIT73
STOCKHOLDERS' EQUITY (DEFICIT) (Common Stock) (Details) | Feb. 12, 2018USD ($)shares | Jun. 29, 2017USD ($)shares | Apr. 28, 2017USD ($)$ / sharesshares | Aug. 31, 2017USD ($)shares | Jul. 31, 2017USD ($)shares | Feb. 28, 2018shares | Dec. 31, 2017USD ($)shares | Dec. 31, 2016shares |
Class of Stock [Line Items] | ||||||||
Common stock, shares authorized (in shares) | 150,000,000 | 1,806,850 | ||||||
Conversion ratio | 0.033 | |||||||
Restricted shares issued (in shares) | 64,593 | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 59,563 | |||||||
Restricted stock expense | $ | $ 28,000 | |||||||
Number of shares converted (in shares) | 1,735,419 | |||||||
New shares issued (in shares) | 22,518 | |||||||
Stock Not Issued, Shares | 200,081 | |||||||
Bridge Loan [Member] | ||||||||
Class of Stock [Line Items] | ||||||||
Debt converted | $ | $ 900,000 | $ 900,000 | $ 900,000 | $ 1,787,000 | ||||
Common Stock [Member] | ||||||||
Class of Stock [Line Items] | ||||||||
Number of shares converted (in shares) | 5,352,847 | |||||||
Issuance of common stock for consulting services in connection with the merger (in shares) | 321,821 | |||||||
Equity instrument fair value | $ | $ 2,200,000 | |||||||
Shares issued in connection with business combination (in shares) | 1,255,119 | |||||||
Number of shares converted from debt instrument (in shares) | 1,414,700 | |||||||
Common Stock [Member] | Bridge Loan [Member] | ||||||||
Class of Stock [Line Items] | ||||||||
Conversion price (in dollars per share) | $ / shares | $ 2.50 | |||||||
Number of shares converted from debt instrument (in shares) | 359,999 | 359,999 | 359,999 | |||||
Series B Preferred Stock [Member] | ||||||||
Class of Stock [Line Items] | ||||||||
Number of shares converted (in shares) | 1,550,485 | |||||||
Series C Preferred Stock [Member] | ||||||||
Class of Stock [Line Items] | ||||||||
Number of shares converted (in shares) | 142,857 | |||||||
Precipio Diagnostic [Member] | ||||||||
Class of Stock [Line Items] | ||||||||
Conversion ratio | 10.2502 | |||||||
Precipio Diagnostic [Member] | Common Stock [Member] | ||||||||
Class of Stock [Line Items] | ||||||||
Number of shares converted (in shares) | 7,356,170 | |||||||
Subsequent Events [Member] | ||||||||
Class of Stock [Line Items] | ||||||||
Issuance of common stock for consulting services in connection with the merger (in shares) | 1,814,754 | |||||||
New shares issued (in shares) | 1,814,754 | 721,153 | ||||||
Number of shares converted from debt instrument (in shares) | 1,814,754 | |||||||
Debt converted | $ | $ 1,900,000 |
STOCKHOLDERS' EQUITY (DEFICIT74
STOCKHOLDERS' EQUITY (DEFICIT) (Series A and Series B Preferred Stock) (Details) - shares | Dec. 31, 2017 | Dec. 31, 2016 | Mar. 31, 2016 |
Class of Stock [Line Items] | |||
Preferred stock, shares outstanding (in shares) | 4,935 | 780,105 | |
Series A Preferred Stock | |||
Class of Stock [Line Items] | |||
Preferred stock, shares outstanding (in shares) | 367,299 | ||
Series A Preferred Stock Amount One [Member] | |||
Class of Stock [Line Items] | |||
Preferred stock, shares outstanding (in shares) | 275,237 | ||
Series B Preferred Stock [Member] | |||
Class of Stock [Line Items] | |||
Preferred stock, shares outstanding (in shares) | 412,806 | ||
Series B Preferred Stock Amount One [Member] | |||
Class of Stock [Line Items] | |||
Preferred stock, shares outstanding (in shares) | 208,087 |
STOCKHOLDERS' EQUITY (DEFICIT75
STOCKHOLDERS' EQUITY (DEFICIT) (Preferred Stock) (Details) - shares | Dec. 31, 2017 | Dec. 31, 2016 |
Stockholders' Equity Note [Abstract] | ||
Preferred stock, shares authorized (in shares) | 15,000,000 | 1,294,434 |
STOCKHOLDERS' EQUITY (DEFICIT76
STOCKHOLDERS' EQUITY (DEFICIT) (Series A Senior Preferred Stock) (Details) - USD ($) | Jun. 29, 2017 | Aug. 31, 2017 | Jun. 30, 2016 | Dec. 31, 2017 | Dec. 31, 2016 |
Class of Stock [Line Items] | |||||
Preferred stock, shares authorized (in shares) | 15,000,000 | 1,294,434 | |||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | |||
Preferred stock, dividend rate (percentage) | 8.00% | ||||
Shares converted, value | $ 3,000,000 | $ 433,000 | |||
New shares issued (in shares) | 22,518 | ||||
Number of shares converted (in shares) | 1,735,419 | ||||
Warrants, fair value | $ 211,000 | $ 1,421,738 | |||
Issuance of warrants | $ 84,000,000 | $ 7,784,000 | |||
Preferred stock, shares outstanding (in shares) | 4,935 | 780,105 | |||
Preferred stock, shares issued (in shares) | 4,935 | 780,105 | |||
Private Placement | |||||
Class of Stock [Line Items] | |||||
New shares issued (in shares) | 107,056 | ||||
Consideration received | $ 400,000 | ||||
Transgenomics [Member] | |||||
Class of Stock [Line Items] | |||||
Shares converted, value | $ 3,000,000 | ||||
Preferred stock - series A senior | |||||
Class of Stock [Line Items] | |||||
Preferred stock, shares authorized (in shares) | 4,100,000 | 4,100,000 | |||
Preferred stock, par value (in dollars per share) | $ 0.01 | ||||
Conversion price (in dollars per share) | $ 3.736329 | ||||
Conversion of stock, discount rate | 15.00% | ||||
Preferred stock, dividend rate (percentage) | 8.00% | ||||
Deemed dividend | $ 5,200,000 | ||||
Number of shares converted (in shares) | 1,712,901 | ||||
Warrants, fair value | $ 1,400,000 | ||||
Preferred stock, shares outstanding (in shares) | 0 | ||||
Preferred stock, shares issued (in shares) | 1,712,901 | ||||
Preferred Stock [Member] | |||||
Class of Stock [Line Items] | |||||
Number of shares converted from debt instrument (in shares) | 802,920 | ||||
Number of shares converted (in shares) | 7,155 | ||||
Preferred Stock [Member] | Private Placement | |||||
Class of Stock [Line Items] | |||||
New shares issued (in shares) | 107,056 | ||||
Preferred Stock [Member] | Transgenomics [Member] | |||||
Class of Stock [Line Items] | |||||
Number of shares converted from debt instrument (in shares) | 802,925 | ||||
Common Stock [Member] | |||||
Class of Stock [Line Items] | |||||
Number of shares converted from debt instrument (in shares) | 1,414,700 | ||||
Number of shares converted (in shares) | 5,352,847 | ||||
Stock rights issued (in shares) | 856,446 |
STOCKHOLDERS' EQUITY (DEFICIT77
STOCKHOLDERS' EQUITY (DEFICIT) (Series B Preferred Stock) (Details) - USD ($) | Jun. 29, 2017 | Apr. 28, 2017 | Nov. 30, 2017 | Aug. 31, 2017 | Dec. 31, 2017 | Oct. 31, 2017 | Aug. 25, 2017 | Dec. 31, 2016 | Jun. 30, 2016 |
Class of Stock [Line Items] | |||||||||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | |||||||
Exercise price (in dollars per share) | $ 0 | ||||||||
Proceeds from Issuance of preferred stock | $ 7,784,000 | ||||||||
Number of shares converted (in shares) | 1,735,419 | ||||||||
Preferred stock, shares authorized (in shares) | 15,000,000 | 1,294,434 | |||||||
Preferred stock, shares outstanding (in shares) | 4,935 | 780,105 | |||||||
Preferred stock, shares issued (in shares) | 4,935 | 780,105 | |||||||
Aegis | |||||||||
Class of Stock [Line Items] | |||||||||
Preferred stock, par value (in dollars per share) | $ 0.01 | ||||||||
Share price (in dollars per share) | $ 1,000 | ||||||||
Stock rights issued (in shares) | 280,000 | ||||||||
Warrant unit value (per unit) | $ 2,800 | ||||||||
Proceeds from issuance of warrants | $ 5,000,000 | ||||||||
Offering Warrants [Member] | |||||||||
Class of Stock [Line Items] | |||||||||
Stock rights issued (in shares) | 2,680,000 | ||||||||
Exercise price (in dollars per share) | $ 1.40 | $ 3 | |||||||
Preferred Class B | |||||||||
Class of Stock [Line Items] | |||||||||
Preferred stock, par value (in dollars per share) | $ 0.01 | ||||||||
Shares callable by warrant (in shares) | 400 | ||||||||
Conversion price (in dollars per share) | $ 1.40 | $ 2.50 | $ 2.50 | ||||||
Share price (in dollars per share) | $ 1,000 | ||||||||
Beneficial conversion feature on warrants | $ 2,000,000 | ||||||||
Number of shares converted (in shares) | 3,613 | ||||||||
Preferred stock, shares authorized (in shares) | 6,900 | 6,900 | |||||||
Preferred stock, shares outstanding (in shares) | 2,387 | ||||||||
Preferred stock, shares issued (in shares) | 6,900 | ||||||||
Preferred Stock, Liquidation Preference Per Share | $ 1,000 | ||||||||
Common Stock [Member] | |||||||||
Class of Stock [Line Items] | |||||||||
Shares callable by warrant (in shares) | 400 | ||||||||
Stock rights issued (in shares) | 856,446 | ||||||||
Exercise price (in dollars per share) | $ 7.50 | ||||||||
Number of shares converted (in shares) | 5,352,847 | ||||||||
Public Stock Offering | |||||||||
Class of Stock [Line Items] | |||||||||
Shares sold in offering (in shares) | 6,000 | ||||||||
Sale of stock, number of warrants per unit (in shares) | 1 | ||||||||
Proceeds from Issuance of preferred stock | 2,800,000 | $ 6,000,000 | |||||||
Beneficial conversion feature on warrants | 2,300,000 | ||||||||
Public Stock Offering | Offering Warrants [Member] | |||||||||
Class of Stock [Line Items] | |||||||||
Proceeds from Issuance of preferred stock | $ 1,300,000 | $ 2,900,000 | |||||||
Public Stock Offering | Preferred Class B | |||||||||
Class of Stock [Line Items] | |||||||||
Shares sold in offering (in shares) | 6,000 | ||||||||
Proceeds from Issuance of preferred stock | $ 3,100,000 | ||||||||
Preferred Class B | |||||||||
Class of Stock [Line Items] | |||||||||
Sale of stock, number of shares per unit (in shares) | 1 | ||||||||
Preferred Class B | Common Stock [Member] | |||||||||
Class of Stock [Line Items] | |||||||||
Number of shares converted (in shares) | 1,550,485 |
STOCKHOLDERS' EQUITY (DEFICIT78
STOCKHOLDERS' EQUITY (DEFICIT) (Series C Preferred Stock) (Details) - USD ($) | Nov. 02, 2017 | Jun. 29, 2017 | Apr. 28, 2017 | Nov. 30, 2017 | Aug. 31, 2017 | Dec. 31, 2017 | Nov. 06, 2017 | Dec. 31, 2016 | Jun. 30, 2016 |
Class of Stock [Line Items] | |||||||||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | |||||||
Exercise price (in dollars per share) | $ 0 | ||||||||
Proceeds from Issuance of preferred stock | $ 7,784,000 | ||||||||
Number of shares converted (in shares) | 1,735,419 | ||||||||
Preferred stock, shares authorized (in shares) | 15,000,000 | 1,294,434 | |||||||
Preferred stock, shares outstanding (in shares) | 4,935 | 780,105 | |||||||
Preferred stock, shares issued (in shares) | 4,935 | 780,105 | |||||||
Conversion of Stock, Shares Issued | 142,857 | ||||||||
Aegis | |||||||||
Class of Stock [Line Items] | |||||||||
Preferred stock, par value (in dollars per share) | $ 0.01 | ||||||||
Share price (in dollars per share) | $ 1,000 | ||||||||
Stock rights issued (in shares) | 280,000 | ||||||||
Warrant unit value (per unit) | $ 2,800 | ||||||||
Proceeds from issuance of warrants | $ 5,000,000 | ||||||||
Offering Warrants [Member] | |||||||||
Class of Stock [Line Items] | |||||||||
Stock rights issued (in shares) | 2,680,000 | ||||||||
Exercise price (in dollars per share) | $ 1.40 | $ 3 | |||||||
Common Stock [Member] | |||||||||
Class of Stock [Line Items] | |||||||||
Shares callable by warrant (in shares) | 400 | ||||||||
Stock rights issued (in shares) | 856,446 | ||||||||
Exercise price (in dollars per share) | $ 7.50 | ||||||||
Number of shares converted (in shares) | 5,352,847 | ||||||||
Series C Preferred Stock [Member] | |||||||||
Class of Stock [Line Items] | |||||||||
Preferred stock, par value (in dollars per share) | $ 0.01 | ||||||||
Warrants outstanding (in shares) | 1,962,857 | ||||||||
Exercise price (in dollars per share) | $ 1.63 | ||||||||
Warrant unit value (per unit) | $ 1,000 | ||||||||
Proceeds from Issuance of preferred stock | 2,748,000 | ||||||||
Number of shares converted (in shares) | 142,857 | ||||||||
Preferred stock, shares authorized (in shares) | 2,748 | 2,748 | |||||||
Preferred stock, shares outstanding (in shares) | 2,548 | ||||||||
Preferred stock, shares issued (in shares) | 2,748 | ||||||||
Preferred Stock, Liquidation Preference Per Share | $ 1,000 | ||||||||
Preferred shares converted | 200 | ||||||||
Public Stock Offering | |||||||||
Class of Stock [Line Items] | |||||||||
Shares sold in offering (in shares) | 6,000 | ||||||||
Sale of stock, number of warrants per unit (in shares) | 1 | ||||||||
Proceeds from Issuance of preferred stock | 2,800,000 | $ 6,000,000 | |||||||
Beneficial conversion feature on warrants | 2,300,000 | ||||||||
Debt Instrument, Convertible, Beneficial Conversion Feature | 1,200,000 | ||||||||
Public Stock Offering | Offering Warrants [Member] | |||||||||
Class of Stock [Line Items] | |||||||||
Proceeds from Issuance of preferred stock | 1,300,000 | $ 2,900,000 | |||||||
Public Stock Offering | Series C Preferred Stock [Member] | |||||||||
Class of Stock [Line Items] | |||||||||
Proceeds from Issuance of preferred stock | $ 1,500,000 | ||||||||
Placement Agreement [Member] | Series C Preferred Stock [Member] | |||||||||
Class of Stock [Line Items] | |||||||||
Shares sold in offering (in shares) | 2,748 |
STOCKHOLDERS' EQUITY (DEFICIT79
STOCKHOLDERS' EQUITY (DEFICIT) (Common Stock Warrants) (Details) - USD ($) | Jun. 29, 2017 | Jun. 27, 2017 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Jun. 28, 2017 |
Class of Stock [Line Items] | |||||||
Underlying shares (in shares) | 1,958,166 | 6,197,681 | |||||
Exercise price (in dollars per share) | $ 0 | ||||||
Warrants, fair value | $ 211,000 | $ 1,421,738 | |||||
Preferred stock, shares outstanding (in shares) | 4,935 | 780,105 | |||||
Preferred stock issued, value | $ 8,000 | ||||||
Preferred stock, dividend rate (percentage) | 8.00% | ||||||
Dividends, preferred stock | $ 432,716 | ||||||
Stock warrant potential Entity ownership percentage | 60.00% | ||||||
Warrants Converted into Common Stock | 1,958,166 | ||||||
Series A Preferred Stock | |||||||
Class of Stock [Line Items] | |||||||
Preferred stock, shares outstanding (in shares) | 367,299 | ||||||
Preferred stock issued, value | $ 750,000 | ||||||
Proceeds from Issuance of Warrants | $ 25,000 | ||||||
Series B Preferred Stock [Member] | |||||||
Class of Stock [Line Items] | |||||||
Preferred stock, shares outstanding (in shares) | 412,806 | ||||||
Preferred stock issued, value | $ 965,000 | ||||||
Series B Preferred Stock [Member] | Webster Bank | |||||||
Class of Stock [Line Items] | |||||||
Underlying shares (in shares) | 20,000 | ||||||
Class of warrant or right, term | 7 years | ||||||
Line of credit | Series A Preferred Stock | |||||||
Class of Stock [Line Items] | |||||||
Underlying shares (in shares) | 8,542 | ||||||
Exercise price (in dollars per share) | $ 2.93 | ||||||
Warrants, fair value | $ 6,000 | ||||||
Volatility rate | 40.00% | ||||||
Term | 7 years | ||||||
Risk free rate | 0.36% |
STOCKHOLDERS' EQUITY (DEFICIT80
STOCKHOLDERS' EQUITY (DEFICIT) (New Bridge Warrants) (Details) - USD ($) | 1 Months Ended | 12 Months Ended | |||
Aug. 31, 2017 | Dec. 31, 2017 | Jun. 30, 2017 | Jun. 29, 2017 | Jun. 30, 2016 | |
Class of Stock [Line Items] | |||||
Underlying shares (in shares) | 6,197,681 | 1,958,166 | |||
Exercise price (in dollars per share) | $ 0 | ||||
Warrants, fair value | $ 211,000 | $ 1,421,738 | |||
Common Stock [Member] | |||||
Class of Stock [Line Items] | |||||
Underlying shares (in shares) | 45,600 | ||||
Exercise price (in dollars per share) | $ 7.50 | ||||
Percentage of per share offering price | 110.00% | ||||
Common Stock [Member] | Minimum [Member] | |||||
Class of Stock [Line Items] | |||||
Exercise price (in dollars per share) | $ 1.50 | ||||
2017 Bridge Notes [Member] | |||||
Class of Stock [Line Items] | |||||
Warrants, fair value | $ 211,000 | ||||
Dividends | $ 12,000 | ||||
2017 Bridge Notes [Member] | Common Stock [Member] | |||||
Class of Stock [Line Items] | |||||
Exercise price (in dollars per share) | $ 2.75 | ||||
Bridge Loan [Member] | Common Stock [Member] | |||||
Class of Stock [Line Items] | |||||
Underlying shares (in shares) | 45,600 | ||||
Exercise price (in dollars per share) | $ 3 | $ 1.40 | $ 7.50 | ||
Percentage of per share offering price | 110.00% | ||||
Transgenomics [Member] | Aegis Warrants | |||||
Class of Stock [Line Items] | |||||
Underlying shares (in shares) | 5,600 | ||||
Transgenomics [Member] | Common Stock [Member] | |||||
Class of Stock [Line Items] | |||||
Underlying shares (in shares) | 40,000 | 40,000 | |||
Exercise price (in dollars per share) | $ 15 | $ 15 | |||
Transgenomics [Member] | Common Stock [Member] | Aegis Warrants | |||||
Class of Stock [Line Items] | |||||
Underlying shares (in shares) | 5,600 | ||||
Exercise price (in dollars per share) | $ 15 | $ 15 | |||
Transgenomics [Member] | Bridge Loan [Member] | 2017 Bridge Notes [Member] | |||||
Class of Stock [Line Items] | |||||
Sale of debt | $ 1,200,000 |
STOCKHOLDERS' EQUITY (DEFICIT81
STOCKHOLDERS' EQUITY (DEFICIT) (Side Warrants) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Jun. 29, 2017 | Jun. 30, 2016 | |
Class of Warrant or Right [Line Items] | |||
Underlying shares (in shares) | 6,197,681 | 1,958,166 | |
Exercise price (in dollars per share) | $ 0 | ||
Warrants, fair value | $ 211,000 | $ 1,421,738 | |
Merger advisory fees | $ 2,676,000 | ||
Upon Execution | |||
Class of Warrant or Right [Line Items] | |||
Underlying shares (in shares) | 22,857 | ||
Performance Based | |||
Class of Warrant or Right [Line Items] | |||
Underlying shares (in shares) | 68,572 | ||
Common Stock [Member] | |||
Class of Warrant or Right [Line Items] | |||
Underlying shares (in shares) | 45,600 | ||
Exercise price (in dollars per share) | $ 7.50 | ||
Side Warrants [Member] | |||
Class of Warrant or Right [Line Items] | |||
Underlying shares (in shares) | 91,429 | ||
Exercise price (in dollars per share) | $ 7 | ||
Warrants, fair value | $ 487,000 | ||
Class of warrant or right, term | 5 years | ||
Merger advisory fees | $ 487,000 | ||
Side Warrants [Member] | Common Stock [Member] | |||
Class of Warrant or Right [Line Items] | |||
Underlying shares (in shares) | 91,429 |
STOCKHOLDERS' EQUITY (DEFICIT82
STOCKHOLDERS' EQUITY (DEFICIT) (Offering Warrants) (Details) - USD ($) | 1 Months Ended | |||
Nov. 30, 2017 | Aug. 31, 2017 | Jun. 29, 2017 | Jun. 30, 2016 | |
Class of Stock [Line Items] | ||||
Exercise price (in dollars per share) | $ 0 | |||
Common Stock [Member] | ||||
Class of Stock [Line Items] | ||||
Stock rights issued (in shares) | 856,446 | |||
Exercise price (in dollars per share) | $ 7.50 | |||
Offering Warrants [Member] | ||||
Class of Stock [Line Items] | ||||
Stock rights issued (in shares) | 2,680,000 | |||
Exercise price (in dollars per share) | $ 1.40 | $ 3 | ||
Class of warrant or right, term | 5 years | |||
Deemed dividend | $ 211,000 | |||
Offering Warrants [Member] | Common Stock [Member] | ||||
Class of Stock [Line Items] | ||||
Percentage of outstanding shares owned threshold prior to exercise of warrants | 4.99% | |||
Percentage of outstanding shares owned threshold after exercise of warrants | 9.99% |
STOCKHOLDERS' EQUITY (DEFICIT83
STOCKHOLDERS' EQUITY (DEFICIT) (Representative Warrants) (Details) - USD ($) | 1 Months Ended | |||
Aug. 31, 2017 | Dec. 31, 2017 | Jun. 29, 2017 | Jun. 30, 2016 | |
Class of Stock [Line Items] | ||||
Underlying shares (in shares) | 6,197,681 | 1,958,166 | ||
Exercise price (in dollars per share) | $ 0 | |||
Warrants, fair value | $ 211,000 | $ 1,421,738 | ||
Representative Warrants [Member] | ||||
Class of Stock [Line Items] | ||||
Underlying shares (in shares) | 60,000 | |||
Exercise price (in dollars per share) | $ 3.125 | |||
Proceeds from issuance of warrants | $ 100 | |||
Warrants, fair value | $ 113,000 |
STOCKHOLDERS' EQUITY (DEFICIT84
STOCKHOLDERS' EQUITY (DEFICIT) (Warrants Outstanding) (Details) - USD ($) | Jun. 29, 2017 | Apr. 28, 2017 | Aug. 31, 2017 | Jul. 31, 2017 | Dec. 31, 2017 | Nov. 30, 2017 | Jun. 30, 2017 | Jun. 30, 2016 |
Class of Warrant or Right [Line Items] | ||||||||
Underlying shares (in shares) | 6,197,681 | 1,958,166 | ||||||
Exercise price (in dollars per share) | $ 0 | |||||||
Warrants, fair value | $ 211,000 | $ 1,421,738 | ||||||
Bridge Loan [Member] | ||||||||
Class of Warrant or Right [Line Items] | ||||||||
Conversion of debt into stock | $ 900,000 | $ 900,000 | $ 900,000 | $ 1,787,000 | ||||
Common Stock [Member] | ||||||||
Class of Warrant or Right [Line Items] | ||||||||
Stock rights issued (in shares) | 856,446 | |||||||
Underlying shares (in shares) | 45,600 | |||||||
Exercise price (in dollars per share) | $ 7.50 | |||||||
Number of shares converted from debt instrument (in shares) | 1,414,700 | |||||||
Common Stock [Member] | Bridge Loan [Member] | ||||||||
Class of Warrant or Right [Line Items] | ||||||||
Underlying shares (in shares) | 45,600 | |||||||
Exercise price (in dollars per share) | $ 3 | $ 1.40 | $ 7.50 | |||||
Number of shares converted from debt instrument (in shares) | 359,999 | 359,999 | 359,999 | |||||
Side Warrants [Member] | ||||||||
Class of Warrant or Right [Line Items] | ||||||||
Underlying shares (in shares) | 91,429 | |||||||
Exercise price (in dollars per share) | $ 7 | |||||||
Warrants, fair value | $ 487,000 | |||||||
Class of warrant or right, term | 5 years | |||||||
Side Warrants [Member] | Common Stock [Member] | ||||||||
Class of Warrant or Right [Line Items] | ||||||||
Underlying shares (in shares) | 91,429 | |||||||
Offering Warrants [Member] | ||||||||
Class of Warrant or Right [Line Items] | ||||||||
Stock rights issued (in shares) | 2,680,000 | |||||||
Exercise price (in dollars per share) | $ 3 | $ 1.40 | ||||||
Class of warrant or right, term | 5 years | |||||||
Offering Warrants [Member] | Common Stock [Member] | ||||||||
Class of Warrant or Right [Line Items] | ||||||||
Percentage of outstanding shares owned threshold prior to exercise of warrants | 4.99% | |||||||
Percentage of outstanding shares owned threshold after exercise of warrants | 9.99% | |||||||
Representative Warrants [Member] | ||||||||
Class of Warrant or Right [Line Items] | ||||||||
Underlying shares (in shares) | 60,000 | |||||||
Exercise price (in dollars per share) | $ 3.125 | |||||||
Warrants, fair value | $ 113,000 | |||||||
Proceeds from issuance of warrants | $ 100 | |||||||
Series A Conversion Warrants [Member] | ||||||||
Class of Warrant or Right [Line Items] | ||||||||
Underlying shares (in shares) | 856,446 | |||||||
Exercise price (in dollars per share) | $ 10 | |||||||
Warrants, fair value | $ 1,400,000 | |||||||
Class of warrant or right, term | 5 years |
STOCKHOLDERS' EQUITY (DEFICIT85
STOCKHOLDERS' EQUITY (DEFICIT) (Series A Conversion Warrants) (Details) - USD ($) | 1 Months Ended | |||
Aug. 31, 2017 | Dec. 31, 2017 | Jun. 29, 2017 | Jun. 30, 2016 | |
Class of Stock [Line Items] | ||||
Underlying shares (in shares) | 6,197,681 | 1,958,166 | ||
Exercise price (in dollars per share) | $ 0 | |||
Warrants, fair value | $ 211,000 | $ 1,421,738 | ||
Series A Conversion Warrants [Member] | ||||
Class of Stock [Line Items] | ||||
Underlying shares (in shares) | 856,446 | |||
Exercise price (in dollars per share) | $ 10 | |||
Class of warrant or right, term | 5 years | |||
Warrants, fair value | $ 1,400,000 |
STOCKHOLDERS' EQUITY (DEFICIT86
STOCKHOLDERS' EQUITY (DEFICIT) (Note Conversion Warrants) (Details) - USD ($) | Jun. 29, 2017 | Apr. 28, 2017 | Dec. 31, 2017 | Aug. 31, 2017 | Jul. 31, 2017 | Dec. 31, 2017 | Jun. 30, 2017 | Jun. 30, 2016 |
Class of Stock [Line Items] | ||||||||
Exercise price (in dollars per share) | $ 0 | |||||||
Common Stock [Member] | ||||||||
Class of Stock [Line Items] | ||||||||
Conversion of debt into stock (in shares) | 1,414,700 | |||||||
Exercise price (in dollars per share) | $ 7.50 | |||||||
Bridge Loan [Member] | ||||||||
Class of Stock [Line Items] | ||||||||
Debt converted | $ 900,000 | $ 900,000 | $ 900,000 | $ 1,787,000 | ||||
Loss on extinguishment of debt and induced conversion of convertible bridge notes | $ 1,000,000 | |||||||
Round Down | $ 28,000 | |||||||
Bridge Loan [Member] | Common Stock [Member] | ||||||||
Class of Stock [Line Items] | ||||||||
Conversion of debt into stock (in shares) | 359,999 | 359,999 | 359,999 | |||||
Exercise price (in dollars per share) | $ 1.40 | $ 3 | $ 1.40 | $ 7.50 | ||||
Loss on extinguishment of debt and induced conversion of convertible bridge notes | $ 1,000,000 |
STOCKHOLDERS' EQUITY (DEFICIT87
STOCKHOLDERS' EQUITY (DEFICIT) (Convertible Promissory Note Warrants) (Details) - USD ($) | 1 Months Ended | |||
Dec. 31, 2017 | Aug. 31, 2017 | Jun. 29, 2017 | Jun. 30, 2016 | |
Class of Stock [Line Items] | ||||
Underlying shares (in shares) | 6,197,681 | 1,958,166 | ||
Exercise price (in dollars per share) | $ 0 | |||
Warrants, fair value | $ 211,000 | $ 1,421,738 | ||
Convertible Promissory Note Warrants [Member] | ||||
Class of Stock [Line Items] | ||||
Warrant Partial Payment | $ 83,333 | |||
Underlying shares (in shares) | 10,000 | 10,000 | ||
Exercise price (in dollars per share) | $ 1.40 | $ 3 | ||
Class of warrant or right, term | 5 years | |||
Warrants, fair value | $ 15,000 | |||
Deemed dividend | $ 1,000 |
STOCKHOLDERS' EQUITY (DEFICIT88
STOCKHOLDERS' EQUITY (DEFICIT) (Series C Warrants) (Details) - USD ($) | 1 Months Ended | |||
Nov. 30, 2017 | Dec. 31, 2017 | Jun. 29, 2017 | Jun. 30, 2016 | |
Class of Stock [Line Items] | ||||
Underlying shares (in shares) | 6,197,681 | 1,958,166 | ||
Exercise price (in dollars per share) | $ 0 | |||
Warrants, fair value | $ 211,000 | $ 1,421,738 | ||
Series C Warrants [Member] | ||||
Class of Stock [Line Items] | ||||
Underlying shares (in shares) | 1,962,857 | |||
Exercise price (in dollars per share) | $ 1.63 | |||
Class of warrant or right, term | 5 years | |||
Percentage of outstanding shares owned threshold prior to exercise of warrants | 4.99% | |||
Percentage of outstanding shares owned threshold after exercise of warrants | 9.99% |
STOCKHOLDERS' EQUITY (DEFICIT89
STOCKHOLDERS' EQUITY (DEFICIT) (Schedule of Warrants) (Details) - $ / shares | Dec. 31, 2017 | Jun. 30, 2016 |
Class of Stock [Line Items] | ||
Underlying shares (in shares) | 6,197,681 | 1,958,166 |
Exercise price (in dollars per share) | $ 0 | |
Warrants Assumed in Merger, Expiring January 2018 [Member] | ||
Class of Stock [Line Items] | ||
Underlying shares (in shares) | 23,055 | |
Exercise price (in dollars per share) | $ 270 | |
Warrants Assumed in Merger, Expiring April 2020 [Member] | ||
Class of Stock [Line Items] | ||
Underlying shares (in shares) | 12,487 | |
Exercise price (in dollars per share) | $ 120 | |
Warrants Assumed in Merger, Expiring February 2020[Member] | ||
Class of Stock [Line Items] | ||
Underlying shares (in shares) | 23,826 | |
Exercise price (in dollars per share) | $ 67.20 | |
Warrants Assumed in Merger, Expiring December 2020 [Member] | ||
Class of Stock [Line Items] | ||
Underlying shares (in shares) | 4,081 | |
Exercise price (in dollars per share) | $ 49.80 | |
Warrants Assumed in Merger, Expiring January 2021, Group A [Member] | ||
Class of Stock [Line Items] | ||
Underlying shares (in shares) | 38,732 | |
Exercise price (in dollars per share) | $ 36.30 | |
Warrants Assumed in Merger, Expiring January 2021, Group B [Member] | ||
Class of Stock [Line Items] | ||
Underlying shares (in shares) | 29,168 | |
Exercise price (in dollars per share) | $ 36.30 | |
Warrants Not Assumed in Merger, Expiring June 2022, Group A [Member] | ||
Class of Stock [Line Items] | ||
Underlying shares (in shares) | 45,600 | |
Exercise price (in dollars per share) | $ 2.75 | |
Warrants Not Assumed in Merger, Expiring June 2022, Group B [Member] | ||
Class of Stock [Line Items] | ||
Underlying shares (in shares) | 91,429 | |
Exercise price (in dollars per share) | $ 7 | |
Warrants Not Assumed in Merger, Expiring August 2022, Group A [Member] | ||
Class of Stock [Line Items] | ||
Underlying shares (in shares) | 2,680,000 | |
Exercise price (in dollars per share) | $ 1.40 | |
Warrants Not Assumed in Merger, Expiring August 2022, Group B [Member] | ||
Class of Stock [Line Items] | ||
Underlying shares (in shares) | 60,000 | |
Exercise price (in dollars per share) | $ 3.125 | |
Warrants Not Assumed in Merger, Expiring August 2022, Group C [Member] | ||
Class of Stock [Line Items] | ||
Underlying shares (in shares) | 856,446 | |
Exercise price (in dollars per share) | $ 10 | |
Warrants Not Assumed in Merger, Expiring August 2022, Group D [Member] | ||
Class of Stock [Line Items] | ||
Underlying shares (in shares) | 359,999 | |
Exercise price (in dollars per share) | $ 1.40 | |
Warrants Not Assumed in Merger, Expiring October 2022 [Member] | ||
Class of Stock [Line Items] | ||
Underlying shares (in shares) | 10,000 | |
Exercise price (in dollars per share) | $ 1.40 | |
Warrants Not Assumed in Merger, Expiring May 2023 [Member] | ||
Class of Stock [Line Items] | ||
Underlying shares (in shares) | 1,962,857 | |
Exercise price (in dollars per share) | $ 1.63 |
FAIR VALUE (Narratives) (Detail
FAIR VALUE (Narratives) (Details) - 2016 Warrant Liability | 12 Months Ended |
Dec. 31, 2017shares | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Warrants outstanding (in shares) | 25,584 |
Volatility (as a percent) | 136.00% |
Risk-free interest rate (as a percent) | 1.98% |
FAIR VALUE (Details)
FAIR VALUE (Details) - 2016 Warrant Liability $ in Thousands | 12 Months Ended |
Dec. 31, 2017USD ($) | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Beginning balance | |
Additions | 615 |
Total (gains) or losses: | |
Recognized in earnings | 226 |
Balance at end of period | $ 841 |
EQUITY INCENTIVE PLAN (Narrativ
EQUITY INCENTIVE PLAN (Narrative) (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock-based compensation | $ 100,000 | |
Unrecognized compensation expense related to unvested stock awards | $ 300,000 | |
Unvested stock options, unrecognized compensation expense weighted average recognition period | 3 years 7 months 6 days | |
Share-based compensation arrangement by share-based payment award, expiration period | 10 years | |
Accrued expenses | $ 1,122,000 | $ 50,000 |
SARs [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock appreciation rights, aggregate intrinsic value, outstanding | 0 | |
Decrease in SAR liability | $ 8,000 | |
Stock Options [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock options, expected to vest, outstanding (in shares) | 180,645 | |
Stock options, expected to vest, outstanding, aggregate intrinsic value | $ 0 | |
Stock options, expected to vest remaining contractual term | 9 years 7 months 6 days | |
Weighted average grant date fair value (in dollars per share) | $ 1.59 | |
Risk free interest rate, minimum | 1.87% | |
Risk free interest rate, maximum | 2.01% | |
Volatility rate | 118.00% | |
Term | 6 years | |
Equity Incentive Plan 2017 [Member] | Stock Options [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based compensation arrangement by share-based payment award, expiration period | 10 years | |
Shares available for issuance | 666,666 | |
Pricing model used for fair value assumptions | Black-Scholes option pricing model | |
Minimum [Member] | Stock Options [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock options, unvested options, vesting period | 3 years | |
Maximum [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock options, unvested options, vesting period | 4 years | |
Maximum [Member] | Stock Options [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock options, unvested options, vesting period | 4 years |
EQUITY INCENTIVE PLAN (Summary
EQUITY INCENTIVE PLAN (Summary of Stock Option Activity) (Details) - Stock Options [Member] | 12 Months Ended |
Dec. 31, 2017$ / sharesshares | |
Number of Options | |
Outstanding at beginning of period (in shares) | shares | 24,600 |
Granted (in shares) | shares | 232,332 |
Forfeited (in shares) | shares | (20,448) |
Outstanding at end of period (in shares) | shares | 236,484 |
Exercisable at end of period (in shares) | shares | 13,161 |
Weighted-Average Exercise Price | |
Outstanding at beginning of period (in dollars per share) | $ / shares | $ 107.83 |
Granted (in dollars per share) | $ / shares | 1.85 |
Forfeited (in dollars per share) | $ / shares | 68.39 |
Outstanding at end of period (in dollars per share) | $ / shares | 7.12 |
Exercisable at end of period (in dollars per share) | $ / shares | $ 93.27 |
NET SALES SERVICE REVENUE AND94
NET SALES SERVICE REVENUE AND ACCOUNTS RECEIVABLE (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Concentration Risk [Line Items] | ||
Clinical research grants | $ 278 | |
Sales Revenue, Net [Member] | Customer Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 50.00% | 33.00% |
Sales Revenue, Net [Member] | Minimum [Member] | Customer Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 15.00% | 15.00% |
Sales Revenue, Net [Member] | Maximum [Member] | Customer Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 20.00% | 18.00% |
NET SALES SERVICE REVENUE AND95
NET SALES SERVICE REVENUE AND ACCOUNTS RECEIVABLE (Schedule of Sales) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Service revenue | $ 2,565 | $ 3,385 |
Less: contractual allowances and adjustments | (863) | (1,284) |
Service revenue, net | 1,702 | 2,101 |
Medicaid [Member] | ||
Service revenue, net | 39 | 25 |
Medicare [Member] | ||
Service revenue, net | 569 | 688 |
Self-Pay [Member] | ||
Service revenue, net | 103 | 253 |
Third party payers [Member] | ||
Service revenue, net | 500 | $ 1,135 |
Contract diagnostic services [Member] | ||
Service revenue, net | $ 491 |
NET SALES SERVICE REVENUE AND96
NET SALES SERVICE REVENUE AND ACCOUNTS RECEIVABLE (Schedule of Receivables) (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Accounts Receivable, Gross | $ 1,857 | $ 1,198 |
Less allowance for doubtful accounts | (1,127) | (810) |
Accounts receivable, net | 730 | 388 |
Medicaid [Member] | ||
Accounts Receivable, Gross | 37 | 22 |
Medicare [Member] | ||
Accounts Receivable, Gross | 256 | 232 |
Self-Pay [Member] | ||
Accounts Receivable, Gross | 53 | 63 |
Third party payers [Member] | ||
Accounts Receivable, Gross | 1,066 | $ 881 |
Contract diagnostic services [Member] | ||
Accounts Receivable, Gross | $ 445 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - USD ($) | Mar. 28, 2018 | Mar. 21, 2018 | Feb. 12, 2018 | Feb. 09, 2018 | Jan. 08, 2018 | Jan. 08, 2018 | Jun. 29, 2017 | Jan. 31, 2018 | Aug. 31, 2017 | Feb. 28, 2018 | Dec. 31, 2017 | Feb. 13, 2018 | Dec. 31, 2016 | Jun. 30, 2016 |
Subsequent Event [Line Items] | ||||||||||||||
Stock and Warrants Issued During Period, Value, Preferred Stock and Warrants | $ 84,000,000 | $ 7,784,000 | ||||||||||||
Stock Issued During Period, Value, Issued for Services | $ 2,189,000 | |||||||||||||
Exercise price (in dollars per share) | $ 0 | |||||||||||||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | ||||||||||||
Common Stock [Member] | ||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||
Stock Issued During Period, Shares, Issued for Services | 321,821 | |||||||||||||
Exercise price (in dollars per share) | $ 7.50 | |||||||||||||
Subsequent Events [Member] | ||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 6,056,166 | |||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Additional Shares Authorized | 5,389,500 | |||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Additional Annual Shares Authorized | 500,000 | |||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Maximum Number of Shares Per Employee | 1,000,000 | |||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Percentage of Outstanding Stock Maximum | 5.00% | |||||||||||||
Stock and Warrants Issued During Period, Value, Preferred Stock and Warrants | $ 1,900,000 | $ 709,000 | ||||||||||||
Stock Issued During Period, Shares, Issued for Services | 1,814,754 | |||||||||||||
Stock Issued During Period, Value, Issued for Services | $ 1,900,000 | |||||||||||||
Subsequent Events [Member] | Convertible Preferred Stock [Member] | ||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||
Share price (in dollars per share) | $ 1.40 | $ 1.04 | ||||||||||||
Exercise price (in dollars per share) | $ 0.75 | |||||||||||||
Proceeds from Issuance of Warrants | $ 200,000 | $ 200,000 | ||||||||||||
Warrants Issued During Period, Maximum Allowed Percentage of Common Stock | 4.99% | |||||||||||||
Subsequent Events [Member] | Leviston Resources LLC [Member] | ||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||
Equity Purchase Agreement | $ 8,000,000 | |||||||||||||
Equity Purchase Agreement, Commitment Fee Percentage | 5.25% | |||||||||||||
Equity Purchase Agreement, Commitment Fee Installment Percentage | 1.75% | |||||||||||||
Equity Purchase Agreement, Fee | $ 35,000 | |||||||||||||
Equity Purchase Agreement, Fee, Contingent Discount | 15,000 | |||||||||||||
Stock and Warrants Issued During Period, Value, Preferred Stock and Warrants | $ 721,153 | |||||||||||||
Share price (in dollars per share) | $ 1.04 | |||||||||||||
Proceeds from Issuance of Private Placement | $ 744,000 | |||||||||||||
Stock Issued During Period, Shares, Issued for Services | 170,711 | |||||||||||||
Stock Issued During Period, Value, Issued for Services | $ 140,000 | |||||||||||||
Company stock percentage of market rate | 97.25% | |||||||||||||
Potential liquidation damage amount related to purchase agreement | $ 100,000 | |||||||||||||
Potential liquidation damage amount to each occurrence of default related to the purchase agreement | $ 100,000 | |||||||||||||
Exercise price (in dollars per share) | $ 1.04 | |||||||||||||
Common stock purchase fee | 0.75% | |||||||||||||
Subsequent Events [Member] | Preferred Stock Induced Conversions, Second Investor [Member] | Convertible Preferred Stock [Member] | ||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||
Stock and Warrants Issued During Period, Value, Preferred Stock and Warrants | $ 500,000 | |||||||||||||
Subsequent Events [Member] | Preferred Stock Induced Conversions, First Investor [Member] | Convertible Preferred Stock [Member] | ||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||
Class of Warrant or Right, Warrants or Rights Excercised | 666,666 | |||||||||||||
Connecticut Department of Economic and Community Development Laon [Member] | Subsequent Events [Member] | ||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||
Secured debt | $ 300,000 | $ 300,000 | ||||||||||||
Proceeds from Grants and Issuance of Debt | 400,000 | 400,000 | ||||||||||||
Proceeds from Grantors | $ 100,000 | $ 100,000 | ||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 3.25% | 3.25% |