Filed: 8 Aug 19

Document and Entity Information

Document and Entity Information - shares6 Months Ended
Jun. 30, 2019Aug. 02, 2019
Document And Entity Information
Entity Registrant NamePOLARITYTE, INC.
Entity Central Index Key0001076682
Document Type10-Q
Document Period End DateJun. 30,
2019
Amendment Flagfalse
Current Fiscal Year End Date--12-31
Entity Reporting Status CurrentYes
Entity Interactive Data CurrentYes
Entity Filer CategoryAccelerated Filer
Entity Small Business Flagtrue
Entity Emerging Growth Companyfalse
Entity Ex Transition Periodfalse
Entity Shell Companyfalse
Entity Common Stock, Shares Outstanding25,824,862
Document Fiscal Period FocusQ2
Document Fiscal Year Focus2019

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($) $ in ThousandsJun. 30, 2019Dec. 31, 2018
Current assets:
Cash and cash equivalents $ 45,887 $ 55,673
Short-term investments12,342 6,162
Accounts receivable1,336 712
Inventory362 336
Prepaid expenses and other current assets1,918 1,432
Total current assets61,845 64,315
Non-current assets:
Property and equipment, net16,200 13,736
Operating lease right-of-use assets5,454
Intangible assets, net825 924
Goodwill278 278
Other assets353 913
Total non-current assets23,110 15,851
TOTAL ASSETS84,955 80,166
Current liabilities:
Accounts payable and accrued expenses5,977 6,508
Other current liabilities2,646 316
Current portion of long-term note payable538 529
Deferred revenue44 170
Total current liabilities9,205 7,523
Long-term note payable, net236 479
Operating lease liabilities3,833
Other long-term liabilities1,315 131
Total liabilities14,589 8,133
Commitments and Contingencies
STOCKHOLDERS' EQUITY:
Preferred stock - 25,000,000 shares authorized, 0 shares issued and outstanding at June 30, 2019 and December 31, 2018
Common stock - $.001 par value; 250,000,000 shares authorized; 25,218,606 and 21,447,088 shares issued and outstanding at June 30, 2019 and December 31, 2018, respectively25 21
Additional paid-in capital461,491 414,840
Accumulated other comprehensive income79 36
Accumulated deficit(391,229)(342,864)
Total stockholders' equity70,366 72,033
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 84,955 $ 80,166

Condensed Consolidated Balanc_2

Condensed Consolidated Balance Sheets (Parenthetical) - $ / sharesJun. 30, 2019Dec. 31, 2018
Statement of Financial Position [Abstract]
Preferred stock, shares authorized25,000,000 25,000,000
Preferred stock, shares issued0 0
Preferred stock, shares outstanding0 0
Common stock, par value$ .001$ .001
Common stock, shares authorized250,000,000 250,000,000
Common stock, shares issued25,218,606 21,447,088
Common stock, shares outstanding25,218,606 21,447,088

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands3 Months Ended6 Months Ended
Jun. 30, 2019Jun. 30, 2018Jun. 30, 2019Jun. 30, 2018
Net revenues
Total net revenues $ 1,326 $ 320 $ 2,791 $ 323
Cost of sales
Total cost of sales596 166 1,372 167
Gross profit730 154 1,419 156
Operating costs and expenses
Research and development4,764 2,915 10,116 8,488
General and administrative15,060 11,290 32,255 18,863
Sales and marketing3,981 7,934
Total operating costs and expenses23,805 14,205 50,305 27,351
Operating loss(23,075)(14,051)(48,886)(27,195)
Other income (expenses)
Interest income, net29 51 99 88
Other income, net254 422
Change in fair value of derivatives 1,850
Loss on extinguishment of warrant liability (520)
Net loss(22,792)(14,000)(48,365)(25,777)
Deemed dividend - accretion of discount on Series F preferred stock (698)
Deemed dividend - exchange of Series F preferred stock (7,057)
Cumulative dividends on Series F preferred stock (191)
Net loss attributable to common stockholders $ (22,792) $ (14,000) $ (48,365) $ (33,723)
Net loss per share, basic and diluted:
Net loss $ (0.92) $ (0.74) $ (2.09) $ (1.82)
Deemed dividend - accretion of discount on Series F preferred stock (0.05)
Deemed dividend - exchange of Series F preferred stock (0.50)
Cumulative dividends on Series F preferred stock (0.01)
Net loss attributable to common stockholders $ (0.92) $ (0.74) $ (2.09) $ (2.38)
Weighted average shares outstanding, basic and diluted:24,768,453 18,944,964 23,190,343 14,187,518
Products [Member]
Net revenues
Total net revenues $ 504 $ 189 $ 801 $ 192
Cost of sales
Total cost of sales342 125 615 126
Services [Member]
Net revenues
Total net revenues822 131 1,990 131
Cost of sales
Total cost of sales $ 254 $ 41 $ 757 $ 41

Condensed Consolidated Statem_2

Condensed Consolidated Statements of Comprehensive Loss (Unaudited) - USD ($) $ in Thousands3 Months Ended6 Months Ended
Jun. 30, 2019Jun. 30, 2018Jun. 30, 2019Jun. 30, 2018
Statement of Comprehensive Income [Abstract]
Net loss $ (22,792) $ (14,000) $ (48,365) $ (25,777)
Other comprehensive income:
Unrealized gain on available-for-sale securities26 43
Comprehensive loss $ (22,766) $ (14,000) $ (48,322) $ (25,777)

Condensed Consolidated Statem_3

Condensed Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) $ in ThousandsPreferred Stock [Member]Common Stock [Member]Additional Paid-in Capital [Member]Accumulated Other Comprehensive Income [Member]Accumulated Deficit [Member]Total
Balance at Dec. 31, 2017 $ 109,104 $ 7 $ 157,395 $ (269,920) $ (3,414)
Balance, shares at Dec. 31, 20171,656,838 7,082,836
Conversion of Series A preferred stock to common stock $ (391) 391
Conversion of Series A preferred stock to common stock, shares(1,602,099)363,036
Conversion of Series B preferred stock to common stock $ (4,020) $ 1 4,019
Conversion of Series B preferred stock to common stock, shares(47,689)794,820
Conversion of Series E preferred stock to common stock $ (104,693) $ 7 104,686
Conversion of Series E preferred stock to common stock, shares(7,050)7,050,000
Exchange of Series F preferred stock and dividends to common stock $ 1 13,060 13,061
Exchange of Series F preferred stock and dividends to common stock, shares 1,003,393
Extinguishment of warrant liability 3,045 3,045
Extinguishment of warrant liability, shares 151,871
Stock-based compensation expense 7,445 7,445
Stock-based compensation expense, shares
Deemed dividend - accretion of discount on Series F preferred stock (698) (698)
Cumulative dividends on Series F preferred stock (191) (191)
Series F preferred stock dividends paid in common stock 306 306
Series F preferred stock dividends paid in common stock, shares 11,708
Net loss(11,777)(11,777)
Balance at Mar. 31, 2018 $ 16 289,458 (281,697)7,777
Balance, shares at Mar. 31, 2018 16,457,664
Balance at Dec. 31, 2017 $ 109,104 $ 7 157,395 (269,920)(3,414)
Balance, shares at Dec. 31, 20171,656,838 7,082,836
Deemed dividend - accretion of discount on Series F preferred stock(698)
Cumulative dividends on Series F preferred stock(191)
Net loss(25,777)
Balance at Jun. 30, 2018 $ 20 390,538 (295,697)94,861
Balance, shares at Jun. 30, 2018 21,445,370
Balance at Mar. 31, 2018 $ 16 289,458 (281,697)7,777
Balance, shares at Mar. 31, 2018 16,457,664
Stock-based compensation expense 8,344 8,344
Stock-based compensation expense, shares 175,887
Deemed dividend - accretion of discount on Series F preferred stock
Cumulative dividends on Series F preferred stock
Proceeds received from issuance of common stock, net of issuance costs of $2,782 $ 4 92,672 92,676
Proceeds received from issuance of common stock, net of issuance costs of $2,782, shares 4,791,819
Stock option exercises 64 64
Stock option exercises shares 20,000
Net loss(14,000)(14,000)
Balance at Jun. 30, 2018 $ 20 390,538 (295,697)94,861
Balance, shares at Jun. 30, 2018 21,445,370
Balance at Dec. 31, 2018 $ 21 414,840 36 (342,864)72,033
Balance, shares at Dec. 31, 201821,447,088
Stock-based compensation expense 10,327 10,327
Stock-based compensation expense, shares
Deemed dividend - accretion of discount on Series F preferred stock
Cumulative dividends on Series F preferred stock
Series F preferred stock dividends paid in common stock
Stock option exercises $ 1 528 529
Stock option exercises shares283,250
Vesting of restricted stock units
Vesting of restricted stock units, shares100,912
Shares withheld for tax withholding (740) (740)
Shares withheld for tax withholding, shares(82,011)
Other comprehensive income 17 17
Net loss (25,573)(25,573)
Balance at Mar. 31, 2019 $ 22 424,955 53 (368,437)56,593
Balance, shares at Mar. 31, 201921,749,239
Balance at Dec. 31, 2018 $ 21 414,840 36 (342,864)72,033
Balance, shares at Dec. 31, 201821,447,088
Deemed dividend - accretion of discount on Series F preferred stock
Cumulative dividends on Series F preferred stock
Shares withheld for tax withholding598
Net loss(48,365)
Balance at Jun. 30, 2019 $ 25 461,491 79 (391,229)70,366
Balance, shares at Jun. 30, 201925,218,606
Balance at Mar. 31, 2019 $ 22 424,955 53 (368,437)56,593
Balance, shares at Mar. 31, 201921,749,239
Stock-based compensation expense 8,618 8,618
Stock-based compensation expense, shares
Deemed dividend - accretion of discount on Series F preferred stock
Cumulative dividends on Series F preferred stock
Proceeds received from issuance of common stock, net of issuance costs of $2,782 $ 3 27,945 27,948
Proceeds received from issuance of common stock, net of issuance costs of $2,782, shares3,418,918
Stock option exercises
Stock option exercises shares9,167
Vesting of restricted stock units
Vesting of restricted stock units, shares51,440
Shares withheld for tax withholding (62) (62)
Shares withheld for tax withholding, shares(17,418)
Shares issued under the ESPP 35 35
Shares issued under the ESPP, shares7,260
Other comprehensive income 26 26
Net loss (22,792)(22,792)
Balance at Jun. 30, 2019 $ 25 $ 461,491 $ 79 $ (391,229) $ 70,366
Balance, shares at Jun. 30, 201925,218,606

Condensed Consolidated Statem_4

Condensed Consolidated Statements of Stockholders' Equity (Parenthetical) - USD ($) $ in ThousandsJun. 30, 2019Jun. 30, 2018
Statement of Stockholders' Equity [Abstract]
Proceeds received from issuance of common stock, net of issuance costs $ 1,146 $ 2,782

Condensed Consolidated Statem_5

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands6 Months Ended
Jun. 30, 2019Jun. 30, 2018
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $ (48,365) $ (25,777)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock based compensation expense18,907 15,789
Change in fair value of derivatives (1,850)
Depreciation and amortization1,446 672
Loss on extinguishment of warrant liability 520
Amortization of intangible assets99 33
Amortization of debt discount28 11
Change in fair value of contingent consideration(48)20
Other non-cash adjustments30
Changes in operating assets and liabilities:
Accounts receivable(624)(332)
Inventory(26)(249)
Prepaid expenses and other current assets(486)2
Operating lease right-of-use assets791
Other assets25 (137)
Accounts payable and accrued expenses(17)448
Other current liabilities367
Deferred revenue(126)
Operating lease liabilities(670)
Other long-term liabilities(120)89
Net cash used in operating activities(28,789)(10,761)
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property and equipment(2,110)(4,163)
Purchase of available-for-sale securities(15,445)
Proceeds from maturities of available-for-sale securities9,278
Acquisition of IBEX (2,258)
Net cash used in investing activities(8,277)(6,421)
CASH FLOWS FROM FINANCING ACTIVITIES
Net proceeds from the sale of common stock27,948 92,676
Proceeds from stock options exercised529 64
Proceeds from ESPP purchase35
Cash paid for tax withholdings related to net share settlement(636)
Payment of contingent consideration liability(109)
Principal payments on financing leases(225)
Principal payments on term note payable(262)
Net cash provided by financing activities27,280 92,740
Net (decrease) increase in cash and cash equivalents(9,786)75,558
Cash and cash equivalents - beginning of period55,673 12,517
Cash and cash equivalents - end of period45,887 88,075
Supplemental schedule of non-cash investing and financing activities:
Conversion of Series A, B, E preferred stock to common stock 109,104
Exchange of Series F preferred stock for common stock 13,061
Extinguishment of warrant liability 2,525
Unpaid liability for acquisition of property and equipment63 441
Deemed dividend - accretion of discount on Series F preferred stock 698
Cumulative dividends on Series F preferred stock 191
Series F preferred stock dividends paid in common stock 306
Unpaid tax liability related to net share settlement43
Unrealized gain on short-term investments and cash equivalents43
Reclassification of stock-based compensation expense that was previously classified as a liability to paid-in capital38
Contingent consideration for IBEX acquisition 278
Contingent consideration earned and recorded in accounts payable 30
Note payable issued as partial consideration for IBEX acquisition $ 1,220

Principal Business Activity and

Principal Business Activity and Basis of Presentation6 Months Ended
Jun. 30, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Principal Business Activity and Basis of Presentation1.
PRINCIPAL BUSINESS ACTIVITY AND BASIS OF PRESENTATION PolarityTE,
Inc. and subsidiaries (the “Company”) is a commercial-stage biotechnology and regenerative biomaterials company focused
on transforming the lives of patients by discovering, designing and developing a range of regenerative tissue products and biomaterials
for the fields of medicine, biomedical engineering and material sciences. Change
in Fiscal Year end. The
accompanying interim condensed consolidated financial statements of the Company are unaudited, but in the opinion of management,
reflect all adjustments, consisting of normal recurring accruals, necessary for a fair presentation of the results for the interim
period. Accordingly, they do not include all information and notes required by generally accepted accounting principles for complete
financial statements. The results of operations for interim periods are not necessarily indicative of results to be expected for
the entire fiscal year. The balance sheet at December 31, 2018 has been derived from the audited financial statements at that
date but does not include all of the information and footnotes required by accounting principles generally accepted in the United
States of America for complete financial statements. These interim condensed consolidated financial statements should be read
in conjunction with the audited consolidated financial statements and notes thereto for the two-month period ended December 31,
2018 included in the Company’s Transition Report on Form 10-KT filed with the Securities and Exchange Commission on March
18, 2019.

Summary of Significant Accounti

Summary of Significant Accounting Policies6 Months Ended
Jun. 30, 2019
Accounting Policies [Abstract]
Summary of Significant Accounting Policies2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Principles
of Consolidation. Use
of estimates. Segments.
Cash
and cash equivalents. Investments Loss
Per Share. Leases The
Company has lease agreements with lease and non-lease components. As allowed under Topic 842, the Company has elected not to separate
lease and non-lease components for any leases involving real estate and office equipment classes of assets and, as a result, accounts
for the lease and non-lease components as a single lease component. The Company has also elected not to apply the recognition
requirement of Topic 842 to leases with a term of 12 months or less for all classes of assets. Stock-
Based Compensation. The
fair value for options issued is estimated at the date of grant using a Black-Scholes option-pricing model. The risk-free rate
is derived from the U.S. Treasury yield curve in effect at the time of the grant. The volatility factor is determined based on
the Company’s historical stock prices. Forfeitures are recognized as they occur. The
value of restricted stock grants is measured based on the fair market value of the Company’s common stock on the date of
grant and amortized over the vesting period of, generally, six months to three years. The
accounting for non-employee options and restricted stock is similar to that of employees. Stock-based compensation expense for
nonemployee services has historically been subject to remeasurement at each reporting date as the underlying equity instruments
vest and was recognized as an expense over the period during which services are received. Upon the adoption of ASU 2018-07, Compensation
– Stock Compensation on January 1, 2019, the valuation was fixed at the implementation date and will be recognized as an
expense on a straight-line basis over the remaining service period. Research
and Development Expenses. Nonrefundable
advance payments for goods or services that have the characteristics that will be used or rendered for future research and development
activities pursuant to executory contractual arrangements with third party research organizations are deferred and recognized
as an expense as the related goods are delivered or the related services are performed. Accruals for Research
and Development Expenses and Clinical Trials. Prior
Quarter Adjustment. Revenue
Recognition. In
the regenerative medicine products segment, the Company records products revenues primarily from the sale of its regenerative
tissue products. The Company sells its products to healthcare providers, primarily through direct sales representatives. Products
revenues consists of a single performance obligation that the Company satisfies at a point in time. In general, the Company recognizes
products revenues upon delivery to the customer. In
the contract services segment, the Company records services revenues from the sale of its contract research services, which includes
delivery of preclinical studies and other research services to unrelated third parties. Services revenues generally consist of
a single performance obligation that the Company satisfies over time using an input method based on costs incurred to date relative
to the total costs expected to be required to satisfy the performance obligation. The Company believes that this method provides
a faithful depiction of the transfer of services over the term of the performance obligation based on the remaining services needed
to satisfy the obligation. This requires the Company to make reasonable estimates of the extent of progress toward completion
of the contract. As a result, unbilled receivables and deferred revenue are recognized based on payment timing and work completed.
Generally, a portion of the payment is due upfront and the remainder upon completion of the study, with most studies completing
in less than a year. As of June 30, 2019 and December 31, 2018, the Company had unbilled receivables of $220,000 and $157,000
and deferred revenue of $44,000 and $170,000, respectively. The unbilled receivables balance is included in consolidated accounts
receivable. Revenues of $164,000 were recognized during the six months ended June 30, 2019 that were included in the deferred
revenue balance at the beginning of the period. Costs
to obtain the contract are incurred for products revenues as they are shipped and are expensed as incurred. Recent
Accounting Pronouncements In
August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820), Disclosure Framework-Changes to the Disclosure
Requirements for Fair Value Measurement In
June 2016, the FASB issued ASU No. 2016-13, Financial Instruments-Credit Losses (Topic 326) Recently
Adopted Accounting Pronouncements On
January 1, 2019 the Company adopted ASU 2016-02, Leases (ASC 842) We
elected the package of practical expedients permitted under the transition guidance, which allowed us to carryforward our historical
lease classification, our assessment on whether a contract was or contains a lease, and our initial direct costs for any leases
that existed prior to January 1, 2019. The impact of the adoption of ASC 842 on the accompanying Condensed Consolidated Balance
Sheet as of January 1, 2019 was as follows (in thousands):
December
31, 2018 Adjustments
Due to the Adoption
of ASC 842 January
1, 2019
Operating lease right-of-use
assets $ – $ 5,305 $ 5,305
Liabilities:
Accounts payable
and accrued expenses $ 6,508 $ (75 ) $ 6,433
Other current liabilities 316 1,432 1,748
Operating lease liabilities – 3,948 3,948 The
adjustments due to the adoption of ASC 842 related to the recognition of operating lease right-of-use assets and operating lease
liabilities for the existing operating leases. A cumulative-effect adjustment to beginning accumulated deficit was not required. In
June 2018, the FASB issued ASU 2018-07, Compensation – Stock Compensation (Topic 718): Improvements to Nonemployee Share-based
Payment Accounting

Liquidity

Liquidity6 Months Ended
Jun. 30, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Liquidity3.
LIQUIDITY The
Company has experienced recurring losses and cash outflows from operating activities. Since inception through June 30, 2019, the
Company has an accumulated deficit of $391.2 million. As of June 30, 2019, the Company had cash and cash equivalents and
short-term investments of $58.2 million. On
April 10, 2019, the Company completed an underwritten offering providing for the issuance and sale of 3,418,918 shares of the
Company’s common stock, par value $0.001 per share, at an offering price of $8.51 per share, for net proceeds of approximately
$27.9 million, after deducting offering expenses payable by the Company. Based
upon the current status of the Company’s product development and commercialization plans, the Company believes that its
existing cash, cash equivalents and short-term investments will be adequate to satisfy its capital needs for at least the next
12 months from the date of filing. However, the Company anticipates needing substantial additional financing to continue clinical
deployment and commercialization of its lead product SkinTE, development of its other product candidates, and scaling the manufacturing
capacity for its products and product candidates and prepare for commercial readiness. However, the Company will continue to pursue
fundraising opportunities when available, but such financing may not be available in the future on terms favorable to the Company,
if at all. If adequate financing is not available, the Company may be required to delay, reduce the scope of, or eliminate one
or more of its product development programs. The Company plans to meet its capital requirements primarily through issuances of
equity securities, debt financing, revenue from product sales and future collaborations. Failure to generate revenue or raise
additional capital would adversely affect the Company’s ability to achieve its intended business objectives.

Fair Value

Fair Value6 Months Ended
Jun. 30, 2019
Fair Value Disclosures [Abstract]
Fair Value4.
FAIR VALUE In
accordance with ASC 820, Fair Value Measurements and Disclosures
● Level 1: Observable
inputs such as quoted prices in active markets for identical instruments. This methodology applies to our Level 1 investments,
which are composed of money market funds.
● Level 2: Quoted
prices for similar instruments that are directly or indirectly observable in the market. This methodology applies to our Level
2 investments, which are composed of corporate debt securities, commercial paper, and U.S. government debt securities.
● Level 3: Significant
unobservable inputs supported by little or no market activity. Financial instruments whose values are determined using pricing
models, discounted cash flow methodologies, or similar techniques, for which determination of fair value requires significant
judgment or estimation. This methodology applies to our Level 3 financial instruments, which are composed of contingent consideration.
Financial
instruments measured at fair value are classified in their entirety based on the lowest level of input that is significant to
the fair value measurement. There were no transfers within the hierarchy for any of the periods presented. In
connection with the offering of Units in September 2017 (see Note 10), the Company issued Series F Preferred Shares and warrants
to purchase an aggregate of 322,727 shares of common stock. The Series F Preferred Shares contained an embedded conversion feature
that was not clearly and closely related to the identified host instrument and, as such, was recognized as a derivative liability
measured at fair value. The Company classified these derivatives on the consolidated balance sheet as a current liability. The
warrants were exercisable at $30.00 per share and expire in two years. The warrants were liabilities pursuant to ASC 815. The
warrant agreement provided for an adjustment to the number of common shares issuable under the warrant or adjustment to the exercise
price, including but not limited to, if: (a) the Company issues shares of common stock as a dividend or distribution to holders
of its common stock; (b) the Company subdivides or combines its common stock (i.e., stock split); or (c) the Company issues new
securities for consideration less than the exercise price. Under ASC 815, warrants that provide for down-round exercise price
protection are recognized as derivative liabilities. As
discussed in Note 10, both the warrants and the Series F Preferred Shares were exchanged for common stock on March 6, 2018. The
fair value of the bifurcated embedded conversion feature was estimated to be approximately $7.2 million at March 5, 2018, as calculated
using the Monte Carlo simulation with the following assumptions:
Series
F Conversion Feature
March
5, 2018
Stock price $ 20.05
Exercise price $ 27.50
Risk-free rate 2.2 %
Volatility 88.2 %
Term 1.5 The
fair value of the warrant liability was estimated to be approximately $2.5 million at March 5, 2018 as calculated using the Monte
Carlo simulation with the following assumptions:
Warrant
Liability
March
5, 2018
Stock price $ 20.05
Exercise price $ 30.00
Risk-free rate 2.2 %
Volatility 88.2 %
Term 1.5 The
following table sets forth the changes in the estimated fair value for our Level 3 classified derivative liabilities (in thousands):
2017
Series F Preferred Stock – Warrant Liability 2017
Series F Preferred Stock – Embedded Derivative Total
Warrant and Derivative Liability
Fair value – December
31, 2017 $ 3,388 $ 8,150 $ 11,538
Change in fair value (863 ) (987 ) (1,850 )
Exchange
/ conversion to common shares (2,525 ) (7,163 ) (9,688 )
Fair
value – June 30, 2018 $
– $
– $
– The
following table sets forth the fair value of the Company’s financial assets and liabilities measured on a recurring basis
by level within the fair value hierarchy as of June 30, 2019 and December 31, 2018 (in thousands):
Fair
Value Measurement as of June 30, 2019
Level
1 Level
2 Level
3 Total
Assets:
Money
market funds $ 37 $ – $ – $ 37
Commercial paper – 19,984 – 19,984
Corporate debt securities – 12,342 – 12,342
U.S.
government debt securities – 8,105 – 8,105
Total $ 37 $ 40,431 $ – $ 40,468
Liabilities:
Contingent
consideration $ – $ – $ 135 $ 135
Total $ – $ – $ 135 $ 135
Fair
Value Measurement as of December 31, 2018
Level
1 Level
2 Level
3 Total
Assets:
Money
market funds $ 7 $ – $ – $ 7
Commercial paper – 21,392 – 21,392
Corporate debt securities – 5,448 – 5,448
U.S.
government debt securities – 3,226 – 3,226
Total $ 7 $ 30,066 $ – $ 30,073
Liabilities:
Contingent
consideration $ – $ – $ 261 $ 261
Total $ – $ – $ 261 $ 261 In
May 2018, the Company purchased the assets of a preclinical research sciences business and related real estate from Ibex Group,
L.L.C., a Utah limited liability company, and Ibex Preclinical Research, Inc., a Utah corporation (collectively, “IBEX”).
The aggregate purchase price was $3.8 million, of which $2.3 million was paid at closing and the balance satisfied by a promissory
note payable to IBEX with an initial fair value of $1.2 million and contingent consideration with an initial fair value of $0.3
million The
contingent consideration represents the estimated fair value of future payments due to the Seller of IBEX based on IBEX’s
revenue generated from studies quoted prior to but completed after the transaction. Contingent consideration was initially recognized
at fair value as purchase consideration and is subsequently remeasured at fair value through earnings. The initial fair value
of the contingent consideration was based on the present value of estimated future cash flows using a 20% discount rate. The contingent
consideration is the payment of 15% of the actual revenues received for work on any study initiated within 18 months following
the closing of the purchase on the basis of certain specific customer prospects that received service proposals prior to the closing,
provided that the total payments will not exceed $650,000. Adjustments to the fair value of the contingent consideration liability
is included in general and administrative expense in the accompanying consolidated statements of operations. The
following table sets forth the changes in the estimated fair value of our contingent consideration liability (in thousands) which
is included in other current liabilities:
Contingent
Consideration
Fair value – December
31, 2018 $ 261
Change in fair value (48 )
Earned and paid (78 )
Fair value –
June 30, 2019 $ 135

Cash Equivalents and Available

Cash Equivalents and Available for Sale Marketable Securities6 Months Ended
Jun. 30, 2019
Cash and Cash Equivalents [Abstract]
Cash Equivalents and Available for Sale Marketable Securities5.
CASH EQUIVALENTS AND AVAILABLE FOR SALE MARKETABLE SECURITIES Cash
equivalents and available-for-sale marketable securities consisted of the following as of June 30, 2019 and December 31, 2018
(in thousands):
June
30, 2019
Amortized
Cost Unrealized
Gains Unrealized
Losses Market
Value
Cash equivalents:
Money
market funds $ 37 $ – $ – $ 37
Commercial paper 19,960 24 – 19,984
U.S.
government debt securities 8,074 31 – 8,105
Total cash equivalents
(1) 28,071 55 – 28,126
Short-term investments:
Corporate
debt securities 12,318 24 – 12,342
Total short-term
investments 12,318 24 – 12,342
Total $ 40,389 $ 79 $ – $ 40,468
(1) Included in cash
and cash equivalents in the Company’s consolidated balance sheet as of June 30, 2019 in addition to $17.8 million of
cash.
December
31, 2018
Amortized
Cost Unrealized
Gains Unrealized
Losses Market
Value
Cash equivalents:
Money
market funds $ 7 $ – $ – $ 7
Commercial paper 20,648 30 – 20,678
U.S.
government debt securities 3,224 2 – 3,226
Total cash equivalents
(1) 23,879 32 – 23,911
Short-term investments:
Commercial paper 714 – – 714
Corporate
debt securities 5,444 5 (1 ) 5,448
Total short-term
investments 6,158 5 (1 ) 6,162
Total $ 30,037 $ 37 $ (1 ) $ 30,073
(1) Included
in cash and cash equivalents in the Company’s consolidated balance sheet as of December 31, 2018 in addition to $31.8
million of cash. All
investments in debt securities held as of June 30, 2019 and December 31, 2018 had maturities of less than one year. For the three
and six months ended June 30, 2019, the Company recognized no material realized gains or losses on available-for-sale marketable
securities.

Property and Equipment, Net

Property and Equipment, Net6 Months Ended
Jun. 30, 2019
Property, Plant and Equipment [Abstract]
Property and Equipment, Net6.
PROPERTY AND EQUIPMENT, NET The
following table presents the components of property and equipment, net (in thousands):
June
30, 2019 December
31, 2018
Machinery and equipment $ 11,735 $ 8,276
Land and buildings 2,000 2,000
Computers and software 1,759 1,372
Leasehold improvements 2,272 1,230
Construction in progress 1,582 2,402
Furniture and
equipment 470 614
Total property and
equipment, gross 19,818 15,894
Accumulated depreciation (3,618 ) (2,158 )
Total
property and equipment, net $ 16,200 $ 13,736 Depreciation
and amortization expense for property and equipment, including assets acquired under financing leases for the three and six months
ended June 30, 2019 and 2018 was as follows (in thousands):
For
the three months ended For
the six months ended
June
30, June
30,
2019 2018 2019 2018
General and administrative
expense $ 407 $ 9 $ 764 $ 9
Research and development
expense 363 345 682 663
Total
depreciation and amortization expense $ 770 $ 354 $ 1,446 $ 672

Leases

Leases6 Months Ended
Jun. 30, 2019
Leases [Abstract]
Leases7.
LEASES The
Company leases facilities and certain equipment under noncancelable leases that expire at various dates through November 2024.
These leases require monthly lease payments that may be subject to annual increases throughout the lease term. Certain of these
leases may include options to extend or terminate the lease at the election of the Company. These optional periods have not been
considered in the determination of the right-of-use-assets or lease liabilities associated with these leases as the Company did
not consider it reasonably certain it would exercise the options. In
April 2019, the Company entered into an operating lease to obtain 6,307 square feet of manufacturing, laboratory, and office
space. The lease expires April 2024 and requires monthly lease payments subject to annual increases. During the six months ended
June 30, 2019, the Company also increased office space under an existing lease, which requires additional monthly lease payments. As
of June 30, 2019, the maturities of our operating and finance lease liabilities were as follows (in thousands):
Operating
leases Finance
leases
2019 (excluding the six months
ended June 30, 2019) $ 1,166 $ 301
2020 2,114 596
2021 1,731 593
2022 1,345 328
2023 133 253
Thereafter 79 42
Total lease payments 6,568 2,113
Less:
Imputed
interest (917 ) (351 )
Total $ 5,651 $ 1,762 Supplemental
balance sheet information related to leases was as follows (in thousands):
Finance
leases
As
of June 30, 2019
Finance
lease right-of-use assets included within property and equipment, net $ 2,280
Current finance lease liabilities included within
other current liabilities $ 447
Non-current finance
lease liabilities included within other long-term liabilities 1,315
Total $ 1,762
Operating
leases
As
of June 30, 2019
Current operating lease liabilities
included within other current liabilities $ 1,818
Operating lease
liabilities – non current 3,833
Total $ 5,651 The
components of lease expense were as follows (in thousands):
Three
months ended June 30, 2019 Six
months ended June 30, 2019
Operating lease costs included
within operating costs and expenses $ 546 $ 1,061
Finance lease costs:
Amortization of right
of use assets $ 170 $ 309
Interest on lease
liabilities 44 67
Total $ 214 $
376 Supplemental
cash flow information related to leases was as follows (in thousands):
Six months ended June 30, 2019
Cash paid for amounts included in the measurement
of lease liabilities:
Operating
cash flows from operating leases $ 941
Operating cash flows
from finance leases 67
Financing cash flows
from finance leases 225
Lease liabilities arising from obtaining right-of-use
assets:
Finance leases $ 1,824
Lease payments made
in prior period reclassified to property and equipment 535
Remeasurement of finance
lease liability due to lease modification (22 )
Operating leases 939 As
of June 30, 2019, the weighted average remaining operating lease term is 3.2 years and the weighted average discount rate used
to determine the operating lease liability was 9.81%. The weighted average remaining finance lease term is 3.8 years and the weighted
average discount rate used to determine the finance lease liability was 9.69%.

Accounts Payable and Accrued Ex

Accounts Payable and Accrued Expenses and Other Current Liabilities6 Months Ended
Jun. 30, 2019
Payables and Accruals [Abstract]
Accounts Payable and Accrued Expenses and Other Current Liabilities8.
ACCOUNTS PAYABLE AND ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES The
following table presents the major components of accounts payable and accrued expenses (in thousands):
June
30, 2019 December
31, 2018
Accounts payable $ 2,122 $ 2,918
Salaries and other compensation 1,655 1,280
Legal and accounting 1,382 640
Other accruals 818 1,670
Total
accounts payable and accrued expenses $ 5,977 $ 6,508 Salaries
and other compensation include accrued payroll expense, accrued bonus, and estimated employer 401(k) plan contributions. Other
current liabilities are comprised of the current portion of operating lease liabilities and finance lease liabilities, contingent
consideration, and short-term debt. The short-term debt had a balance of $0.2 million as of June 30, 2019, while the other components
are disclosed in the footnotes above.

Long Term Notes Payable

Long Term Notes Payable6 Months Ended
Jun. 30, 2019
Debt Disclosure [Abstract]
Long Term Notes Payable9.
LONG TERM NOTE PAYABLE In
connection with the IBEX Acquisition in May 2018, the Company issued a promissory note payable to the Seller with an initial fair
value of $1.2 million. The promissory note has a principal balance of $1.3 million and bears interest at a rate of 3.5% interest
per annum. Principal and interest are payable in five equal installments that began on November 3, 2018 and continuing on each
six-month anniversary thereafter (“Payment Date”). The promissory note may be prepaid by the Company at any time and
becomes due and payable at the earlier of the maturity date of November 3, 2020 or upon an event of default, which includes failure
to pay any installment on each Payment Date, breach of any negative covenants, insolvency or bankruptcy. Upon the occurrence of
an event of default, the promissory note will bear an accelerated interest rate of 7% per annum from the date of the event of
default. The
Company initially recognized the promissory note at its fair value, using an estimated market rate of interest for the Company,
which was higher than the promissory note’s stated rate. The result of imputing a market rate of interest resulted in an
initial discount to the principal balance of approximately $113,000, which is being amortized to interest expense over the term
of the promissory note using the effective interest method. The unamortized debt discount was $41,000 and $68,000 at June
30, 2019 and December 31, 2018, respectively. Amortization of debt discount of $13,000 and $28,000 was included in interest income,
net for the three and six months ended June 30, 2019.

Preferred Shares and Common Sha

Preferred Shares and Common Shares6 Months Ended
Jun. 30, 2019
Equity [Abstract]
Preferred Shares and Common Shares10.
PREFERRED SHARES AND COMMON SHARES Exchange
of 100% of Outstanding Series F Preferred Stock Shares and Warrants On
September 20, 2017, the Company sold an aggregate of $17,750,000 worth of units of the Company’s securities (the “Units”)
to accredited investors at a purchase price of $2,750 per Unit. Each Unit consisted of (i) one share of the Company’s newly
authorized 6% Series F Convertible Preferred Stock, par value $0.001 per share (the “Series F Preferred Shares”),
convertible into one hundred (100) shares of the Company’s common stock, and (ii) a two-year warrant to purchase up to 322,727
shares of the Company’s common stock, at an exercise price of $30.00 per share. The
Series F Preferred Shares were convertible into shares of the Company’s common stock based on a conversion calculation equal
to the stated value of the Series F Preferred Shares, plus all accrued and unpaid dividends, if any, on such Series F Preferred
Shares, as of such date of determination, divided by the conversion price. The stated value of each Series F Preferred Share was
$2,750 and the initial conversion price was $27.50 per share, each subject to adjustment for stock splits, stock dividends, recapitalizations,
combinations, subdivisions or other similar events. On
the two-year anniversary of the initial issuance date, any Series F Preferred Shares outstanding and not otherwise already converted,
would, at the option of the holder, either (i) automatically convert into common stock of the Company at the conversion price
then in effect or (ii) be repaid by the Company based on the stated value of such outstanding Series F Preferred Shares. The
warrants issued in connection with the Series F Preferred Shares were determined to be liabilities pursuant to ASC 815. The warrant
agreement provided for an adjustment to the number of common shares issuable under the warrant or adjustment to the exercise price,
including but not limited to, if: (a) the Company issued shares of common stock as a dividend or distribution to holders of its
common stock; (b) the Company subdivided or combined its common stock (i.e., stock split); or (c) the Company issues new securities
for consideration less than the exercise price. Prior to the adoption of ASU 2017-11, warrants that provide for down-round exercise
price protection were recognized as derivative liabilities. The
conversion feature within the Series F Preferred Shares was determined to not be clearly and closely related to the identified
host instrument and, as such, was recognized as a derivative liability measured at fair value pursuant to ASC 815. The
initial fair value of the warrants and bifurcated embedded conversion feature, estimated to be approximately $4.3 million and
$9.3 million, respectively, was deducted from the gross proceeds of the Unit offering to arrive at the initial discounted carrying
value of the Series F Preferred Shares. The resulting discount to the aggregate stated value of the Series F Preferred Shares
of approximately $13.6 million was recognized as accretion using the effective interest method similar to preferred stock dividends,
over the two-year period prior to optional redemption by the holders. On
March 6, 2018, the Company entered into separate exchange agreements (the “Exchange Agreements”) with holders (each
a “Holder”, and collectively the “Holders”) of 100% of the Company’s outstanding Series F Preferred
Shares, and the Company’s warrants to purchase shares of the Company’s common stock issued in connection with the
Series F Preferred Shares (such “Warrants” and Series F Preferred Shares collectively referred to as the “Exchange
Securities”) to exchange the Exchange Securities and unpaid dividends on the Series F Preferred Shares for common stock
(the “Exchange”). The
Exchange resulted in the following issuances: (A) all outstanding Series F Preferred Shares were converted into 972,070 shares
of restricted common stock at an effective conversion price of $18.26 per share of common stock (the closing price of Common Stock
on the NASDAQ Capital Market on February 26, 2018); (B) the right to receive 6% dividends underlying Series F Preferred Shares
was terminated in exchange for 31,321 shares of restricted common stock; (C) 322,727 Warrants to purchase common stock were exchanged
for 151,871 shares of restricted common stock; and (D) the Holders of the Warrants relinquished any and all other rights pursuant
to the Warrants, including exercise price adjustments. As
part of the Exchange, the Holders also relinquished all other rights related to the issuance of the Exchange Securities, the respective
governing agreements and certificates of designation, including any related dividends, adjustment of conversion and exercise price,
and repayment option. The existing registration rights agreement with the holders of the Series F Preferred Shares was also terminated
and the holders of the Series F Preferred Shares waived the obligation of the Company to register the common shares issuable upon
conversion of Series F Preferred Shares or upon exercise of the warrants, and waived any damages, penalties and defaults related
to the Company failing to file or have declared effective a registration statement covering those shares. The
exchange of all outstanding Series F Preferred Shares, and the holders’ right to receive 6% dividends, for common stock
of the Company was recognized as follows:
Fair market value of 1,003,393
shares of common stock issued at $20.05 (Company’s closing stock price on March 5, 2018) in exchange for Series F Preferred
Shares and accrued dividends $ 20,117,990
Carrying value of Series F Preferred Shares
at March 5, 2018, including dividends (5,898,274 )
Carrying value
of bifurcated conversion option at March 5, 2018 (7,162,587 )
Deemed dividend
on Series F Preferred Shares exchange $ 7,057,129 As
the Warrants were classified as a liability, the exchange of the Warrants for common shares was recognized as a liability extinguishment.
As of March 5, 2018, the fair market value of the 151,871 common shares issued in the Exchange was $3,045,034 and the fair value
of the common stock warrant liability was $2,525,567 resulting in a loss on extinguishment of warrant liability of $519,467 during
the six months ended June 30, 2018. The
Company recognized accretion of the discount to the stated value of the Series F Preferred Shares of approximately $698,000 during
the six months ended June 30, 2018, as a reduction of additional paid-in capital and an increase in the carrying value of the
Series F Preferred Shares. The accretion is presented in the Statement of Operations as a deemed dividend, increasing net loss
to arrive at net loss attributable to common stockholders. Preferred
Stock Conversion and Elimination On
February 6, 2018, 15,756 shares of Series B Convertible Preferred Stock (“Series B Preferred Shares”) were converted
into 262,606 shares of common stock. On
March 6, 2018, the Company received conversion notices (in accordance with original terms) from holders of 100% of the outstanding
shares of Series A Convertible Preferred Stock (the “Series A Preferred Shares”), Series B Preferred Shares and Series
E Convertible Preferred Stock (the “Series E Preferred Shares”) and issued an aggregate of 7,945,250 shares of common
stock to such holders. The
shares of Series E Preferred Stock were held by Dr. Denver Lough, the Company’s Chief Executive Officer. On March 6, 2018,
the Company entered into a new registration rights agreement (the “Lough Registration Rights Agreement”) with Dr.
Lough, pursuant to which the Company agreed to file a registration statement to register the resale of 7,050,000 shares of Common
Stock issued upon conversion of the Series E Preferred Shares within six months, to cause such registration statement to be declared
effective by the Securities and Exchange Commission as promptly as possible following its filing and, with certain exceptions
set forth in the Lough Registration Rights Agreement, to maintain the effectiveness of the registration statement until all of
such shares have been sold or are otherwise able to be sold pursuant to Rule 144 under the Securities Act without restriction.
On March 14, 2019, the Company’s registration obligation was waived, and the Lough Registration Rights Agreement amended
to provide that Dr. Lough may demand registration by written request to the Company. Dr. Lough has not made a demand for filing
a registration statement. On
March 7, 2018, the Company filed a Certificate of Elimination with the Secretary of State of the State of Delaware terminating
the Company’s Series A, Series B, Series C, Series D, Series E and Series F Preferred Stock. As a result, the Company has
25,000,000 shares of authorized and unissued preferred stock as of June 30, 2019 with no designation as to series. There
was no convertible preferred stock outstanding as of June 30, 2019 and December 31, 2018.

Stock Based Compensation

Stock Based Compensation6 Months Ended
Jun. 30, 2019
Share-based Payment Arrangement [Abstract]
Stock Based Compensation11.
STOCK-BASED COMPENSATION For
the three and six months ended June 30, 2019 and 2018, the Company recorded stock-based compensation expense related to stock
options and restricted stock awards as follows (in thousands):
For the three months ended For the six months ended
June 30, June 30,
2019 2018 2019 2018
General and administrative expense $ 6,892 $ 7,035 $ 15,929 $ 12,807
Research and development expense 1,481 1,309 2,565 2,982
Sales and marketing expense 245 – 413 -
Total stock-based compensation expense $ 8,618 $ 8,344 $ 18,907 $ 15,789 Incentive
Compensation Plans 2019
Plan On
October 5, 2018, the Company’s Board of Directors (the “Board”) approved the Company’s 2019 Equity Incentive
Plan (the “2019 Plan”). The 2019 Plan provides for the grant of incentive stock options, nonqualified stock options,
restricted stock, restricted stock units, stock appreciation rights and other types of stock-based awards to the Company’s
employees, officers, directors and consultants. The Compensation Committee of the Board will administer the 2019 Plan, including
determining which eligible participants will receive awards, the number of shares of common stock subject to the awards and the
terms and conditions of such awards. Up to 3,000,000 shares of common stock are issuable pursuant to awards under the 2019 Plan.
Unless earlier terminated by the Board, the 2019 Plan shall terminate at the close of business on October 5, 2028. As of June
30, 2019, the Company had approximately 1,857,972 shares available for future issuances under the 2019 Plan. 2017
Plan On December 1, 2016, the
Company’s Board of Directors (the “Board”) approved the Company’s 2017 Equity Incentive Plan (the “2017
Plan”). The purpose of the 2017 Plan is to promote the success of the Company and to increase stockholder value by providing
an additional means through the grant of awards to attract, motivate, retain and reward selected employees, consultants and other
eligible persons. The 2017 Plan provides for the grant of incentive stock options, nonqualified stock options, restricted stock,
restricted stock units, stock appreciation rights and other types of stock-based awards to the Company’s employees, officers,
directors and consultants. The Compensation Committee of the Board will administer the 2017 Plan, including determining which
eligible participants will receive awards, the number of shares of common stock subject to the awards and the terms and conditions
of such awards. Up to 7,300,000 (increased from 3,450,000 in October 2017) shares of common stock are issuable pursuant to awards
under the 2017 Plan. Unless earlier terminated by the Board, the 2017 Plan shall terminate at the close of business on December
1, 2026. As of June 30, 2019, the Company had approximately 374,038 shares available for future issuances under the 2017
Plan. Stock
Options A
summary of the Company’s employee and non-employee stock option activity for the six months ended June 30, 2019 is presented
below:
Number of shares Weighted-Average Exercise Price
Outstanding – December 31, 2018 6,499,885 $ 14.02
Granted 767,201 $ 14.36
Exercised (1) (292,417 ) $ 3.99
Forfeited (370,208 ) $ 7.81
Outstanding – June 30, 2019 6,604,461 $ 14.30
Options exercisable – June 30, 2019 4,567,527 $ 12.11
Weighted-average grant date fair value of options granted during the six months ended June 30, 2019 $ 10.28
(1) The
number of exercised options includes shares withheld on behalf of employees to satisfy minimum statutory tax withholding requirements.
Restricted
Stock A
summary of the Company’s employee and non-employee restricted-stock activity for the six months ended June 30, 2019 is presented
below:
Number of shares Weighted-Average Grant-Date Fair Value
Unvested - December 31, 2018 651,110 $ 23.65
Granted 75,000 $ 10.97
Vested (1) (187,663 ) $ 28.83
Forfeited (45,000 ) $ 22.46
Unvested – June 30, 2019 493,447 $ 22.66
(1) The number of vested
restricted stock units includes shares that were withheld on behalf of employees to satisfy the minimum statutory tax withholding
requirements. Employee
Stock Purchase Plan (ESPP) In
May 2018, the Company adopted the Employee Stock Purchase Plan (“ESPP”). The Company has initially reserved 500,000
shares of common stock for purchase under the ESPP. The initial offering period began January 1, 2019 and ended on June 30, 2019
with the first purchase date. Subsequent offering periods will automatically commence on each January 1 and July 1 and will have
a duration of six months ending with a purchase date June 30 and December 31 of each year. On each purchase date, ESPP participants
will purchase shares of common stock at a price per share equal to 85% of the lesser of (1) the fair market value per share of
the common stock on the offering date or (2) the fair market value of the common stock on the purchase date. Total stock-based
compensation related to the ESPP for the three and six months ended June 30, 2019 was immaterial to the condensed consolidated
financial statements. A total of 7,260 shares of common stock were purchased pursuant to the ESPP during the six months ended
June 30, 2019 for total proceeds of $35,000.

Income Taxes

Income Taxes6 Months Ended
Jun. 30, 2019
Income Tax Disclosure [Abstract]
Income Taxes12.
INCOME TAXES The
Company has evaluated its income tax positions and determined that no material uncertain tax positions existed at June 30, 2019.
The Company does not expect a significant change in its unrecognized tax benefits within the next twelve months. As
of June 30, 2019 and December 31, 2018, the Company maintained a valuation allowance to fully offset its net deferred tax assets
primarily attributable to operations in the United States, as the realization of such assets was not considered more likely than
not. The
Company files income tax returns in the U.S. Federal and various state and local jurisdictions.

Loss Per Share

Loss Per Share6 Months Ended
Jun. 30, 2019
Earnings Per Share [Abstract]
Loss Per Share13.
LOSS PER SHARE The
following outstanding potentially dilutive shares have been excluded from the calculation of diluted net loss per share for the
periods presented due to their anti-dilutive effect:
As of June 30,
2019 2018
Stock options 6,604,461 5,523,068
Restricted stock 493,447 332,089

Commitments and Contingencies

Commitments and Contingencies6 Months Ended
Jun. 30, 2019
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies14.
COMMITMENTS AND CONTINGENCIES Contingencies On June 26, 2018, a class
action complaint alleging violations of the Federal securities laws was filed in the United States District Court, District of
Utah, by Jose Moreno against the Company and two directors of the Company, Case No. 2:18-cv-00510-JNP (the “Moreno Complaint”).
On July 6, 2018, a similar complaint was filed in the same court against the same defendants by Yedid Lawi, Case No. 2:18-cv-00541-PMW
(the “Lawi Complaint”). Both the Moreno Complaint and Lawi Complaint allege that the defendants made or were responsible
for, disseminating information to the public through reports filed with the Securities and Exchange Commission and other channels
that contained material misstatements or omissions in violation of Sections 10 and 20(a) of the Exchange Act and Rule 10b-5 adopted
thereunder. Specifically, both complaints allege that the defendants misrepresented the status of one of the Company’s patent
applications while touting the unique nature of the Company’s technology and its effectiveness. Plaintiffs are seeking damages
suffered by them and the class consisting of the persons who acquired the publicly-traded securities of the Company between March
31, 2017, and June 22, 2018. Plaintiffs have filed motions to consolidate and for appointment as lead plaintiff. On November 28,
2018, the Court consolidated the Moreno and Lawi cases under the caption In re PolarityTE, Inc. Securities Litigation (the “Consolidated
Securities Litigation”), and requested the appointment of the plaintiff in Lawi as the lead plaintiff. On January 16, 2019,
the Court granted the motion of Yedid Lawi for appointment as lead plaintiff, and on February 1, 2019, the Court granted the lead
plaintiff’s motion for approval of lead counsel and liaison counsel. The Court ordered that the lead plaintiff file and serve
a consolidated complaint no later than 60 days after February 1, 2019, the defendants shall have 60 days after filing and service
of the consolidated complaint to answer or otherwise respond, and the lead plaintiff must file a motion for class certification
within 90 days of service of the consolidated complaint. The Lead Plaintiff filed a consolidated complaint on April 2, 2019 and
asserted essentially the same violations of Federal securities laws recited in the original complaints. The Company believes the
allegations in the consolidated complaint are without merit, and intends to defend the litigation, vigorously. The Company filed
a motion to dismiss the consolidated complaint on June 3, 2019. Plaintiffs’ opposition to the Company’s motion to dismiss
was filed on August 2, 2019, and the Company expects to file a reply to the opposition on or about September 13, 2019. At this
early stage of the proceedings the Company is unable to make any prediction regarding the outcome of the litigation. In
the ordinary course of business, we may become involved in lawsuits, claims, investigations, proceedings, and threats of litigation
relating to intellectual property, commercial arrangements, regulatory compliance, and other matters. Except as noted above, at
June 30, 2019, we were not party to any legal or arbitration proceedings that may have significant effects on our financial position
or results of operations. We are not a party to any material proceedings in which any director, member of senior management or
affiliate of ours is either a party adverse to us or our subsidiaries or has a material interest adverse to us or our subsidiaries. Commitments The
Company has entered into employment agreements with key executives that contain severance terms and change of control provisions.

Certain Relationships and Relat

Certain Relationships and Related Transactions6 Months Ended
Jun. 30, 2019
Related Party Transactions [Abstract]
Certain Relationships and Related Transactions15.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS In
October 2018, the Company entered into an office lease covering approximately 7,250 square feet of rental space in the building
located at 40 West 57 th The
Company is using 1,648 square feet, and Cohen LLC is using approximately 4,584 square feet as of June 30, 2019. The monthly lease
payment for 6,232 square feet is $31,160. Of this amount $22,920 is allocated pro rata to Cohen LLC based on square footage occupied.
Additional lease charges for operating expenses and taxes are allocated under the sublease based on the ratio of rent paid by
the Company and Cohen LLC to total rent. Once the space is fully occupied, the Company will reduce the overall annual lease rate
for the Cohen LLC space to $58.60 per square foot. The Company recognized $51,000 and $126,000 of sublease income related to this
agreement for the three and six months ended June 30, 2019, respectively. The sublease income is included in other income, net
in the statement of operations. As of June 30, 2019 and December 31, 2018, there was $102,000 and $0 due from the related party
under this agreement.

Segment Reporting

Segment Reporting6 Months Ended
Jun. 30, 2019
Segment Reporting [Abstract]
Segment Reporting16.
SEGMENT REPORTING The
Company’s current operations involve products and services which are managed separately. Accordingly, it operates in two
segments: 1) regenerative medicine and 2) contract services. Certain
information concerning our segments for the three and six months ended June 30, 2019 and 2018 is presented in the following table
(in thousands):
For the three months ended For the six months ended
June 30, June 30,
2019 2018 2019 2018
Net revenues
Reportable segments:
Regenerative medicine $ 504 $ 189 $ 801 $ 192
Contract services 822 131 1,990 131
Total net revenues $ 1,326 $ 320 $ 2,791 $ 323
Net (loss)/income:
Reportable segments:
Regenerative medicine $ (23,014 ) $ (13,843 ) $ (48,782 ) $ (25,620 )
Contract services 222 (157 ) 417 (157 )
Total net loss $ (22,792 ) $ (14,000 ) $ (48,365 ) $ (25,777 )

Subsequent Events

Subsequent Events6 Months Ended
Jun. 30, 2019
Subsequent Events [Abstract]
Subsequent Events17.
SUBSEQUENT EVENTS On
June 28, 2019, the Company entered into amendments of employment agreements with the members of its Office of the Chief Executive,
which includes Richard Hague, Chief Operating Officer, Paul Mann, Chief Financial Officer, and David Seaburg, President of Corporate
Development. Mr. Hague agreed to reduce his base cash salary by 50% from $370,000 to $185,000 per year over a two-year period
beginning July 1, 2019. Mr. Mann agreed to reduce his base cash salary by 50% from $400,000 to $200,000 per year over a two-year
period beginning July 1, 2019. Mr. Seaburg agreed to reduce his base cash salary by 50% from $325,000 to $162,500 per year over
a two-year period beginning July 1, 2019. For each of them, after the expiration of the two-year period ending June 30, 2021,
the term of employment will automatically renew at the pre-July 1, 2019 salary level unless the Company elects to terminate the
agreement by written notice given not less than three months prior to June 30, 2021. In consideration for the agreement by each
member of the Office of the Chief Executive to reduce his cash salary, the Compensation Committee of the Board of Directors approved
granting restricted stock awards to them on July 1, 2019, under the Company’s 2019 Equity Incentive Plan. Mr. Hague’s
restricted stock award is for 129,825 common shares that are restricted from transfer by reference to continued employment by
the Company, and the restriction on transfer lapses with respect to 10,819 shares in August 2019 and the remainder in monthly
installments through June 2021. Mr. Mann’s restricted stock award is for 140,351 common shares that are restricted from
transfer by reference to continued employment by the Company, and the restriction on transfer lapses with respect to 29,240 shares
in December 2019 and the remainder in monthly installments through June 2021. Mr. Seaburg’s restricted stock award is for
114,035 common shares that are restricted from transfer by reference to continued employment by the Company, and the restriction
on transfer lapses with respect to 23,814 shares in December 2019 and the remainder in monthly installments through June 2021. On August 6, 2019, the Company’s Board
of Directors approved the grant of restricted stock awards under the 2019 Equity Incentive Plan to Richard Hague, Chief Operating
Officer, Paul Mann, Chief Financial Officer, and David Seaburg, President of Corporate Development. Each of them received an award
of 175,000 shares that vests in six installments every six months over a period of three years subject to continued employment.

Summary of Significant Accoun_2

Summary of Significant Accounting Policies (Policies)6 Months Ended
Jun. 30, 2019
Accounting Policies [Abstract]
Principles of ConsolidationPrinciples of Consolidation
Use of EstimatesUse of estimates
SegmentsSegments
Cash and Cash EquivalentsCash
and cash equivalents.
InvestmentsInvestments
Loss Per ShareLoss Per Share
LeasesLeases The
Company has lease agreements with lease and non-lease components. As allowed under Topic 842, the Company has elected not to separate
lease and non-lease components for any leases involving real estate and office equipment classes of assets and, as a result, accounts
for the lease and non-lease components as a single lease component. The Company has also elected not to apply the recognition
requirement of Topic 842 to leases with a term of 12 months or less for all classes of assets.
Stock Based CompensationStock-
Based Compensation. The
fair value for options issued is estimated at the date of grant using a Black-Scholes option-pricing model. The risk-free rate
is derived from the U.S. Treasury yield curve in effect at the time of the grant. The volatility factor is determined based on
the Company’s historical stock prices. Forfeitures are recognized as they occur. The
value of restricted stock grants is measured based on the fair market value of the Company’s common stock on the date of
grant and amortized over the vesting period of, generally, six months to three years. The
accounting for non-employee options and restricted stock is similar to that of employees. Stock-based compensation expense for
nonemployee services has historically been subject to remeasurement at each reporting date as the underlying equity instruments
vest and was recognized as an expense over the period during which services are received. Upon the adoption of ASU 2018-07, Compensation
– Stock Compensation on January 1, 2019, the valuation was fixed at the implementation date and will be recognized as an
expense on a straight-line basis over the remaining service period.
Research and Development ExpensesResearch
and Development Expenses. Nonrefundable
advance payments for goods or services that have the characteristics that will be used or rendered for future research and development
activities pursuant to executory contractual arrangements with third party research organizations are deferred and recognized
as an expense as the related goods are delivered or the related services are performed.
Accruals for Research and Development Expenses and Clinical TrialsAccruals for Research
and Development Expenses and Clinical Trials
Prior Quarter AdjustmentPrior Quarter Adjustment
Revenue RecognitionRevenue
Recognition. In
the regenerative medicine products segment, the Company records products revenues primarily from the sale of its regenerative
tissue products. The Company sells its products to healthcare providers, primarily through direct sales representatives. Products
revenues consists of a single performance obligation that the Company satisfies at a point in time. In general, the Company recognizes
products revenues upon delivery to the customer. In
the contract services segment, the Company records services revenues from the sale of its contract research services, which includes
delivery of preclinical studies and other research services to unrelated third parties. Services revenues generally consist of
a single performance obligation that the Company satisfies over time using an input method based on costs incurred to date relative
to the total costs expected to be required to satisfy the performance obligation. The Company believes that this method provides
a faithful depiction of the transfer of services over the term of the performance obligation based on the remaining services needed
to satisfy the obligation. This requires the Company to make reasonable estimates of the extent of progress toward completion
of the contract. As a result, unbilled receivables and deferred revenue are recognized based on payment timing and work completed.
Generally, a portion of the payment is due upfront and the remainder upon completion of the study, with most studies completing
in less than a year. As of June 30, 2019 and December 31, 2018, the Company had unbilled receivables of $220,000 and $157,000
and deferred revenue of $44,000 and $170,000, respectively. The unbilled receivables balance is included in consolidated accounts
receivable. Revenues of $164,000 were recognized during the six months ended June 30, 2019 that were included in the deferred
revenue balance at the beginning of the period. Costs
to obtain the contract are incurred for products revenues as they are shipped and are expensed as incurred.
Recent Accounting PronouncementsRecent
Accounting Pronouncements In
August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820), Disclosure Framework-Changes to the Disclosure
Requirements for Fair Value Measurement In
June 2016, the FASB issued ASU No. 2016-13, Financial Instruments-Credit Losses (Topic 326)
Recently Adopted Accounting PronouncementsRecently
Adopted Accounting Pronouncements On
January 1, 2019 the Company adopted ASU 2016-02, Leases (ASC 842) We
elected the package of practical expedients permitted under the transition guidance, which allowed us to carryforward our historical
lease classification, our assessment on whether a contract was or contains a lease, and our initial direct costs for any leases
that existed prior to January 1, 2019. The impact of the adoption of ASC 842 on the accompanying Condensed Consolidated Balance
Sheet as of January 1, 2019 was as follows (in thousands):
December
31, 2018 Adjustments
Due to the Adoption
of ASC 842 January
1, 2019
Operating lease right-of-use
assets $ – $ 5,305 $ 5,305
Liabilities:
Accounts payable
and accrued expenses $ 6,508 $ (75 ) $ 6,433
Other current liabilities 316 1,432 1,748
Operating lease liabilities – 3,948 3,948 The
adjustments due to the adoption of ASC 842 related to the recognition of operating lease right-of-use assets and operating lease
liabilities for the existing operating leases. A cumulative-effect adjustment to beginning accumulated deficit was not required. In
June 2018, the FASB issued ASU 2018-07, Compensation – Stock Compensation (Topic 718): Improvements to Nonemployee Share-based
Payment Accounting

Summary of Significant Accoun_3

Summary of Significant Accounting Policies (Tables)6 Months Ended
Jun. 30, 2019
Accounting Policies [Abstract]
Schedule of Adoption of Accounting Pronouncements on Accompanying Condensed Consolidated Balance SheetThe impact of the adoption of ASC 842 on the accompanying Condensed Consolidated Balance
Sheet as of January 1, 2019 was as follows (in thousands):
December
31, 2018 Adjustments
Due to the Adoption
of ASC 842 January
1, 2019
Operating lease right-of-use
assets $ – $ 5,305 $ 5,305
Liabilities:
Accounts payable
and accrued expenses $ 6,508 $ (75 ) $ 6,433
Other current liabilities 316 1,432 1,748
Operating lease liabilities – 3,948 3,948

Fair Value (Tables)

Fair Value (Tables)6 Months Ended
Jun. 30, 2019
Fair Value Disclosures [Abstract]
Schedule of Fair Value Assumptions of Warrants and Embedded Conversion FeatureThe
fair value of the bifurcated embedded conversion feature was estimated to be approximately $7.2 million at March 5, 2018, as calculated
using the Monte Carlo simulation with the following assumptions:
Series
F Conversion Feature
March
5, 2018
Stock price $ 20.05
Exercise price $ 27.50
Risk-free rate 2.2 %
Volatility 88.2 %
Term 1.5 The
fair value of the warrant liability was estimated to be approximately $2.5 million at March 5, 2018 as calculated using the Monte
Carlo simulation with the following assumptions:
Warrant
Liability
March
5, 2018
Stock price $ 20.05
Exercise price $ 30.00
Risk-free rate 2.2 %
Volatility 88.2 %
Term 1.5
Schedule of Changes in Estimated Fair Value for Level 3 Classified Derivative Warrant LiabilityThe
following table sets forth the changes in the estimated fair value for our Level 3 classified derivative liabilities (in thousands):
2017
Series F Preferred Stock – Warrant Liability 2017
Series F Preferred Stock – Embedded Derivative Total
Warrant and Derivative Liability
Fair value – December
31, 2017 $ 3,388 $ 8,150 $ 11,538
Change in fair value (863 ) (987 ) (1,850 )
Exchange
/ conversion to common shares (2,525 ) (7,163 ) (9,688 )
Fair
value – June 30, 2018 $
– $
– $
Schedule of Fair Value of Financial Instruments Measured on Recurring BasisThe
following table sets forth the fair value of the Company’s financial assets and liabilities measured on a recurring basis
by level within the fair value hierarchy as of June 30, 2019 and December 31, 2018 (in thousands):
Fair
Value Measurement as of June 30, 2019
Level
1 Level
2 Level
3 Total
Assets:
Money
market funds $ 37 $ – $ – $ 37
Commercial paper – 19,984 – 19,984
Corporate debt securities – 12,342 – 12,342
U.S.
government debt securities – 8,105 – 8,105
Total $ 37 $ 40,431 $ – $ 40,468
Liabilities:
Contingent
consideration $ – $ – $ 135 $ 135
Total $ – $ – $ 135 $ 135
Fair
Value Measurement as of December 31, 2018
Level
1 Level
2 Level
3 Total
Assets:
Money
market funds $ 7 $ – $ – $ 7
Commercial paper – 21,392 – 21,392
Corporate debt securities – 5,448 – 5,448
U.S.
government debt securities – 3,226 – 3,226
Total $ 7 $ 30,066 $ – $ 30,073
Liabilities:
Contingent
consideration $ – $ – $ 261 $ 261
Total $ – $ – $ 261 $ 261
Schedule of Changes in Estimated Fair Value for Level 3 Classified Contingent ConsiderationThe
following table sets forth the changes in the estimated fair value of our contingent consideration liability (in thousands) which
is included in other current liabilities:
Contingent
Consideration
Fair value – December
31, 2018 $ 261
Change in fair value (48 )
Earned and paid (78 )
Fair value –
June 30, 2019 $ 135

Cash Equivalents and Availabl_2

Cash Equivalents and Available for Sale Marketable Securities (Tables)6 Months Ended
Jun. 30, 2019
Cash and Cash Equivalents [Abstract]
Schedule of Cash Equivalents and Available-for-sale Marketable SecuritiesCash
equivalents and available-for-sale marketable securities consisted of the following as of June 30, 2019 and December 31, 2018
(in thousands):
June
30, 2019
Amortized
Cost Unrealized
Gains Unrealized
Losses Market
Value
Cash equivalents:
Money
market funds $ 37 $ – $ – $ 37
Commercial paper 19,960 24 – 19,984
U.S.
government debt securities 8,074 31 – 8,105
Total cash equivalents
(1) 28,071 55 – 28,126
Short-term investments:
Corporate
debt securities 12,318 24 – 12,342
Total short-term
investments 12,318 24 – 12,342
Total $ 40,389 $ 79 $ – $ 40,468
(1) Included in cash
and cash equivalents in the Company’s consolidated balance sheet as of June 30, 2019 in addition to $17.8 million of
cash.
December
31, 2018
Amortized
Cost Unrealized
Gains Unrealized
Losses Market
Value
Cash equivalents:
Money
market funds $ 7 $ – $ – $ 7
Commercial paper 20,648 30 – 20,678
U.S.
government debt securities 3,224 2 – 3,226
Total cash equivalents
(1) 23,879 32 – 23,911
Short-term investments:
Commercial paper 714 – – 714
Corporate
debt securities 5,444 5 (1 ) 5,448
Total short-term
investments 6,158 5 (1 ) 6,162
Total $ 30,037 $ 37 $ (1 ) $ 30,073
(1) Included
in cash and cash equivalents in the Company’s consolidated balance sheet as of December 31, 2018 in addition to $31.8
million of cash.

Property and Equipment, Net (Ta

Property and Equipment, Net (Tables)6 Months Ended
Jun. 30, 2019
Property, Plant and Equipment [Abstract]
Schedule of Property and Equipment, NetThe
following table presents the components of property and equipment, net (in thousands):
June
30, 2019 December
31, 2018
Machinery and equipment $ 11,735 $ 8,276
Land and buildings 2,000 2,000
Computers and software 1,759 1,372
Leasehold improvements 2,272 1,230
Construction in progress 1,582 2,402
Furniture and
equipment 470 614
Total property and
equipment, gross 19,818 15,894
Accumulated depreciation (3,618 ) (2,158 )
Total
property and equipment, net $ 16,200 $ 13,736
Schedule of Depreciation ExpenseDepreciation
and amortization expense for property and equipment, including assets acquired under financing leases for the three and six months
ended June 30, 2019 and 2018 was as follows (in thousands):
For
the three months ended For
the six months ended
June
30, June
30,
2019 2018 2019 2018
General and administrative
expense $ 407 $ 9 $ 764 $ 9
Research and development
expense 363 345 682 663
Total
depreciation and amortization expense $ 770 $ 354 $ 1,446 $ 672

Leases (Tables)

Leases (Tables)6 Months Ended
Jun. 30, 2019
Leases [Abstract]
Schedule of Operating and Finance Lease LiabilitiesAs
of June 30, 2019, the maturities of our operating and finance lease liabilities were as follows (in thousands):
Operating
leases Finance
leases
2019 (excluding the six months
ended June 30, 2019) $ 1,166 $ 301
2020 2,114 596
2021 1,731 593
2022 1,345 328
2023 133 253
Thereafter 79 42
Total lease payments 6,568 2,113
Less:
Imputed
interest (917 ) (351 )
Total $ 5,651 $ 1,762
Shcedule of Supplemental Balance Sheet Information Related to Finance and Operating LeasesSupplemental
balance sheet information related to leases was as follows (in thousands):
Finance
leases
As
of June 30, 2019
Finance
lease right-of-use assets included within property and equipment, net $ 2,280
Current finance lease liabilities included within
other current liabilities $ 447
Non-current finance
lease liabilities included within other long-term liabilities 1,315
Total $ 1,762
Operating
leases
As
of June 30, 2019
Current operating lease liabilities
included within other current liabilities $ 1,818
Operating lease
liabilities – non current 3,833
Total $ 5,651
Summary of Components of Lease ExpenseThe
components of lease expense were as follows (in thousands):
Three
months ended June 30, 2019 Six
months ended June 30, 2019
Operating lease costs included
within operating costs and expenses $ 546 $ 1,061
Finance lease costs:
Amortization of right
of use assets $ 170 $ 309
Interest on lease
liabilities 44 67
Total $ 214 $
376
Schedule of Supplemental Cash Flow Information Related to LeasesSupplemental
cash flow information related to leases was as follows (in thousands):
Six months ended June 30, 2019
Cash paid for amounts included in the measurement
of lease liabilities:
Operating
cash flows from operating leases $ 941
Operating cash flows
from finance leases 67
Financing cash flows
from finance leases 225
Lease liabilities arising from obtaining right-of-use
assets:
Finance leases $ 1,824
Lease payments made
in prior period reclassified to property and equipment 535
Remeasurement of finance
lease liability due to lease modification (22 )
Operating leases 939

Accounts Payable and Accrued _2

Accounts Payable and Accrued Expenses and Other Current Liabilities (Tables)6 Months Ended
Jun. 30, 2019
Payables and Accruals [Abstract]
Schedule of Accounts Payable and Accrued ExpensesThe
following table presents the major components of accounts payable and accrued expenses (in thousands):
June
30, 2019 December
31, 2018
Accounts payable $ 2,122 $ 2,918
Salaries and other compensation 1,655 1,280
Legal and accounting 1,382 640
Other accruals 818 1,670
Total
accounts payable and accrued expenses $ 5,977 $ 6,508

Preferred Shares and Common S_2

Preferred Shares and Common Shares (Tables)6 Months Ended
Jun. 30, 2019
Equity [Abstract]
Schedule of Deemed Dividend on Preferred Shares ExchangeThe
exchange of all outstanding Series F Preferred Shares, and the holders’ right to receive 6% dividends, for common stock
of the Company was recognized as follows:
Fair market value of 1,003,393
shares of common stock issued at $20.05 (Company’s closing stock price on March 5, 2018) in exchange for Series F Preferred
Shares and accrued dividends $ 20,117,990
Carrying value of Series F Preferred Shares
at March 5, 2018, including dividends (5,898,274 )
Carrying value
of bifurcated conversion option at March 5, 2018 (7,162,587 )
Deemed dividend
on Series F Preferred Shares exchange $ 7,057,129

Stock Based Compensation (Table

Stock Based Compensation (Tables)6 Months Ended
Jun. 30, 2019
Share-based Payment Arrangement [Abstract]
Schedule of Share-based Compensation Related to Restricted Stock Awards and Stock OptionsFor
the three and six months ended June 30, 2019 and 2018, the Company recorded stock-based compensation expense related to stock
options and restricted stock awards as follows (in thousands):
For the three months ended For the six months ended
June 30, June 30,
2019 2018 2019 2018
General and administrative expense $ 6,892 $ 7,035 $ 15,929 $ 12,807
Research and development expense 1,481 1,309 2,565 2,982
Sales and marketing expense 245 – 413 -
Total stock-based compensation expense $ 8,618 $ 8,344 $ 18,907 $ 15,789
Schedule of Share-based Compensation, Stock Options, ActivityA
summary of the Company’s employee and non-employee stock option activity for the six months ended June 30, 2019 is presented
below:
Number of shares Weighted-Average Exercise Price
Outstanding – December 31, 2018 6,499,885 $ 14.02
Granted 767,201 $ 14.36
Exercised (1) (292,417 ) $ 3.99
Forfeited (370,208 ) $ 7.81
Outstanding – June 30, 2019 6,604,461 $ 14.30
Options exercisable – June 30, 2019 4,567,527 $ 12.11
Weighted-average grant date fair value of options granted during the six months ended June 30, 2019 $ 10.28
(1) The
number of exercised options includes shares withheld on behalf of employees to satisfy minimum statutory tax withholding requirements.
Schedule of Share-based Compensation, Restricted Stock ActivityA
summary of the Company’s employee and non-employee restricted-stock activity for the six months ended June 30, 2019 is presented
below:
Number of shares Weighted-Average Grant-Date Fair Value
Unvested - December 31, 2018 651,110 $ 23.65
Granted 75,000 $ 10.97
Vested (1) (187,663 ) $ 28.83
Forfeited (45,000 ) $ 22.46
Unvested – June 30, 2019 493,447 $ 22.66
(1) The number of vested
restricted stock units includes shares that were withheld on behalf of employees to satisfy the minimum statutory tax withholding
requirements.

Loss Per Share (Tables)

Loss Per Share (Tables)6 Months Ended
Jun. 30, 2019
Earnings Per Share [Abstract]
Schedule of Anti-dilutive Potential Shares Outstanding ActivityThe
following outstanding potentially dilutive shares have been excluded from the calculation of diluted net loss per share for the
periods presented due to their anti-dilutive effect:
As of June 30,
2019 2018
Stock options 6,604,461 5,523,068
Restricted stock 493,447 332,089

Segment Reporting (Tables)

Segment Reporting (Tables)6 Months Ended
Jun. 30, 2019
Segment Reporting [Abstract]
Schedule of Segment InformationCertain
information concerning our segments for the three and six months ended June 30, 2019 and 2018 is presented in the following table
(in thousands):
For the three months ended For the six months ended
June 30, June 30,
2019 2018 2019 2018
Net revenues
Reportable segments:
Regenerative medicine $ 504 $ 189 $ 801 $ 192
Contract services 822 131 1,990 131
Total net revenues $ 1,326 $ 320 $ 2,791 $ 323
Net (loss)/income:
Reportable segments:
Regenerative medicine $ (23,014 ) $ (13,843 ) $ (48,782 ) $ (25,620 )
Contract services 222 (157 ) 417 (157 )
Total net loss $ (22,792 ) $ (14,000 ) $ (48,365 ) $ (25,777 )

Summary of Significant Accoun_4

Summary of Significant Accounting Policies (Details Narrative) $ in Thousands3 Months Ended6 Months Ended
Jun. 30, 2019USD ($)Mar. 31, 2019USD ($)Jun. 30, 2019USD ($)SegmentDec. 31, 2018USD ($)
Accounting Policies [Abstract]
Number of operating segments | Segment2
Shares withheld for tax withholding $ (62) $ (740) $ 598
Unbilled receivables220 220 $ 157
Deferred revenue $ 44 44 $ 170
Recognized revenue $ 164

Summary of Significant Accoun_5

Summary of Significant Accounting Policies - Schedule of Adoption of Accounting Pronouncements on Accompanying Condensed Consolidated Balance Sheet (Details) - USD ($) $ in ThousandsJun. 30, 2019Jan. 02, 2019Dec. 31, 2018
Operating lease right-of-use assets $ 5,454 $ 5,305
Accounts payable and accrued expenses6,433 6,508
Other current liabilities2,646 1,748 316
Operating lease liabilities $ 3,833 3,948
Adjustments Due to the Adoption of ASC 842 [Member]
Operating lease right-of-use assets5,305
Accounts payable and accrued expenses(75)
Other current liabilities1,432
Operating lease liabilities $ 3,948

Liquidity (Details Narrative)

Liquidity (Details Narrative) - USD ($) $ / shares in Units, $ in ThousandsApr. 10, 2018Jun. 30, 2019Dec. 31, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Accumulated deficit $ (391,229) $ (342,864)
Cash and cash equivalents and short-term investments $ 58,200
Public offering share value3,418,918
Common stock, par value $ 0.001 $ .001$ .001
Public offering price per share $ 8.51
Proceeds for public offering $ 27,900

Fair Value (Details Narrative)

Fair Value (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands1 Months Ended
May 31, 2018Mar. 05, 2018Sep. 30, 2017
Number of warrant to purchase shares of common stock322,727
Warrant exercisable price per share $ 30
Warrants terms2 years
Embedded conversion feature $ 7,200
Fair value of warrant liability $ 2,500
IBEX [Member]
Payments to acquire assets $ 3,800
Payments to acquire assets, cash paid2,300
Purchase of assets, equity interests issued1,200
Purchase of assets, contingent consideration $ 300
Estimated future cash flows using, discount rate20.00%
Contingent consideration payment percentage of actual revenues received15.00%
Contingent consideration payment of actual revenues received $ 650

Fair Value - Schedule of Fair V

Fair Value - Schedule of Fair Value Assumptions of Warrants and Embedded Conversion Feature (Details)Mar. 05, 2018$ / sharesSep. 30, 2017$ / shares
Warrant liability fair value assumptions, measurement input, exercise price $ 30
Warrant liability fair value assumptions, measurement input, term2 years
Monte Carlo Simulation [Member] | Stock Price [Member] | Warrant Liability [Member]
Warrant liability fair value assumptions, measurement input, stock price $ 20.05
Monte Carlo Simulation [Member] | Exercise Price [Member] | Warrant Liability [Member]
Warrant liability fair value assumptions, measurement input, exercise price $ 30
Monte Carlo Simulation [Member] | Risk Free Rate [Member] | Warrant Liability [Member]
Warrant liability fair value assumptions, measurement input, percentages0.022
Monte Carlo Simulation [Member] | Volatility [Member] | Warrant Liability [Member]
Warrant liability fair value assumptions, measurement input, percentages0.882
Monte Carlo Simulation [Member] | Term [Member] | Warrant Liability [Member]
Warrant liability fair value assumptions, measurement input, term1 year 6 months
Series F Conversion Feature [Member] | Monte Carlo Simulation [Member] | Stock Price [Member]
Embedded conversion feature fair value assumptions, measurement input, price per share $ 20.05
Series F Conversion Feature [Member] | Monte Carlo Simulation [Member] | Exercise Price [Member]
Embedded conversion feature fair value assumptions, measurement input, price per share $ 27.50
Series F Conversion Feature [Member] | Monte Carlo Simulation [Member] | Risk Free Rate [Member]
Embedded conversion feature fair value assumptions, measurement input, percentages0.022
Series F Conversion Feature [Member] | Monte Carlo Simulation [Member] | Volatility [Member]
Embedded conversion feature fair value assumptions, measurement input, percentages0.882
Series F Conversion Feature [Member] | Monte Carlo Simulation [Member] | Term [Member]
Embedded conversion feature fair value assumptions, measurement input, term1 year 6 months

Fair Value - Schedule of Change

Fair Value - Schedule of Changes in Estimated Fair Value for Level 3 Classified Derivative Warrant Liability (Details) - USD ($) $ in Thousands6 Months Ended
Jun. 30, 2019Jun. 30, 2018
Fair value at the beginning of period $ 261 $ 11,538
Change in fair value(48)(1,850)
Exchange / conversion to common shares(9,688)
Fair value at the end of period $ 135
2017 Series F Preferred Stock Warrant Liability [Member]
Fair value at the beginning of period3,388
Change in fair value(863)
Exchange / conversion to common shares(2,525)
Fair value at the end of period
2017 Series F Preferred Stock Embedded Derivative [Member]
Fair value at the beginning of period8,150
Change in fair value(987)
Exchange / conversion to common shares(7,163)
Fair value at the end of period

Fair Value - Schedule of Fair_2

Fair Value - Schedule of Fair Value of Financial Instruments Measured on Recurring Basis (Details) - USD ($) $ in ThousandsJun. 30, 2019Dec. 31, 2018
Money market funds $ 37 $ 7
Commercial paper19,984 21,392
Corporate debt securities12,342 5,448
U.S. government debt securities8,105 3,226
Total40,468 30,073
Contingent consideration135 261
Total135 261
Level 1 [Member]
Money market funds37 7
Commercial paper
Corporate debt securities
U.S. government debt securities
Total37 7
Contingent consideration
Total
Level 2 [Member]
Money market funds
Commercial paper19,984 21,392
Corporate debt securities12,342 5,448
U.S. government debt securities8,105 3,226
Total40,431 30,066
Contingent consideration
Total
Level 3 [Member]
Money market funds
Commercial paper
Corporate debt securities
U.S. government debt securities
Total
Contingent consideration135 261
Total $ 135 $ 261

Fair Value - Schedule of Chan_2

Fair Value - Schedule of Changes in Estimated Fair Value for Level 3 Classified Contingent Consideration (Details) - USD ($) $ in Thousands6 Months Ended
Jun. 30, 2019Jun. 30, 2018
Fair Value Disclosures [Abstract]
Fair value at the beginning of period $ 261 $ 11,538
Change in fair value(48)(1,850)
Earned and paid(78)
Fair value at the end of period $ 135

Cash Equivalents and Availabl_3

Cash Equivalents and Available for Sale Marketable Securities - Schedule of Cash Equivalents and Available-for-sale Marketable Securities (Details) - USD ($) $ in ThousandsJun. 30, 2019Dec. 31, 2018
Money market funds $ 37 $ 7
Commercial paper19,984 20,678
U.S. government debt securities8,105 3,226
Total cash equivalents28,126 [1]23,911 [2]
Commercial paper714
Corporate debt securities12,342 5,448
Total short-term investments12,342 6,162
Total40,468 30,073
Amortized Cost [Member]
Money market funds37 7
Commercial paper19,960 20,648
U.S. government debt securities8,074 3,224
Total cash equivalents28,071 [1]23,879 [2]
Commercial paper714
Corporate debt securities12,318 5,444
Total short-term investments12,318 6,158
Total40,389 30,037
Unrealized Gains [Member]
Money market funds
Commercial paper24 30
U.S. government debt securities31 2
Total cash equivalents55 [1]32 [2]
Commercial paper
Corporate debt securities24 5
Total short-term investments24 5
Total79 37
Unrealized Losses [Member]
Money market funds
Commercial paper
U.S. government debt securities
Total cash equivalents [1] [2]
Commercial paper
Corporate debt securities [2]
Total short-term investments [2]
Total [2]
[1]Included in cash and cash equivalents in the Company's consolidated balance sheet as of June 30, 2019 in addition to $17.8 million of cash.
[2]Included in cash and cash equivalents in the Company's consolidated balance sheet as of December 31, 2018 in addition to $31.8 million of cash.

Cash Equivalents and Availabl_4

Cash Equivalents and Available for Sale Marketable Securities - Schedule of Cash Equivalents and Available-for-sale Marketable Securities (Details) (Parenthetical) - USD ($) $ in ThousandsJun. 30, 2019Dec. 31, 2018
Money market funds $ 37 $ 7
Cash and Cash Equivalents [Member]
Money market funds $ 17,800 $ 31,800

Property and Equipment, Net - S

Property and Equipment, Net - Schedule of Property and Equipment, Net (Details) - USD ($) $ in ThousandsJun. 30, 2019Dec. 31, 2018
Property, Plant and Equipment [Abstract]
Machinery and equipment $ 11,735 $ 8,276
Land and buildings2,000 2,000
Computers and software1,759 1,372
Leasehold improvements2,272 1,230
Construction in progress1,582 2,402
Furniture and equipment470 614
Total property and equipment, gross19,818 15,894
Accumulated depreciation(3,618)(2,158)
Total property and equipment, net $ 16,200 $ 13,736

Property and Equipment, Net -_2

Property and Equipment, Net - Schedule of Depreciation Expense (Details) - USD ($) $ in Thousands3 Months Ended6 Months Ended
Jun. 30, 2019Jun. 30, 2018Jun. 30, 2019Jun. 30, 2018
General and administrative expense $ 15,060 $ 11,290 $ 32,255 $ 18,863
Research and development expense4,764 2,915 10,116 8,488
Total depreciation and amortization expense1,446 672
Depreciation [Member]
General and administrative expense407 9 764 9
Research and development expense363 345 682 663
Total depreciation and amortization expense $ 770 $ 354 $ 1,446 $ 672

Leases (Details Narrative)

Leases (Details Narrative) - ft²6 Months Ended
Jun. 30, 2019Apr. 30, 2019
Leases [Abstract]
Leases facilities, descriptionThe Company leases facilities and certain equipment under noncancelable leases that expire at various dates through November 2024. These leases require monthly lease payments that may be subject to annual increases throughout the lease term. Certain of these leases may include options to extend or terminate the lease at the election of the Company.
Operating lease area optain6,307
Operating lease expiration dateApr. 30,
2024
Weighted average remaining operating lease term, operating lease3 years 2 months 12 days
Weighted average discount rate, operating lease9.81%
Weighted average remaining operating lease term, finance lease3 years 9 months 18 days
Weighted average discount rate, finance lease9.69%

Leases - Schedule of Operating

Leases - Schedule of Operating and Finance Lease Liabilities (Details) $ in ThousandsJun. 30, 2019USD ($)
Leases [Abstract]
2019 (excluding the six months ended June 30, 2019) $ 1,166
20202,114
20211,731
20221,345
2023133
Thereafter79
Total lease payments6,568
Less: Imputed interest(917)
Total5,651
2019 (excluding the six months ended June 30, 2019)301
2020596
2021593
2022328
2023253
Thereafter42
Total lease payments2,113
Less: Imputed interest(351)
Total $ 1,762

Leases - Shcedule of Supplement

Leases - Shcedule of Supplemental Balance Sheet Information Related to Finance and Operating Leases (Details) - USD ($) $ in ThousandsJun. 30, 2019Jan. 02, 2019Dec. 31, 2018
Leases [Abstract]
Finance lease right-of-use assets included within property and equipment, net $ 2,280
Current finance lease liabilities included within other current liabilities447
Non-current finance lease liabilities included within other long-term liabilities1,315
Total1,762
Current operating lease liabilities included within other current liabilities1,818
Operating lease liabilities - non current3,833 $ 3,948
Total $ 5,651

Leases - Summary of Components

Leases - Summary of Components of Lease Expense (Details) - USD ($) $ in Thousands3 Months Ended6 Months Ended
Jun. 30, 2019Jun. 30, 2019
Leases [Abstract]
Operating lease costs included within operating costs and expenses $ 546 $ 1,061
Amortization of right of use assets170 309
Interest on lease liabilities44 67
Total $ 214 $ 376

Leases - Schedule of Supplement

Leases - Schedule of Supplemental Cash Flow Information Related to Leases (Details) $ in Thousands6 Months Ended
Jun. 30, 2019USD ($)
Leases [Abstract]
Operating cash flows from operating leases $ 941
Operating cash flows from finance leases67
Financing cash flows from finance leases225
Finance leases1,824
Lease payments made in prior period reclassified to property and equipment535
Remeasurement of finance lease liability due to lease modification(22)
Operating leases $ 939

Accounts Payable and Accrued _3

Accounts Payable and Accrued Expenses and Other Current Liabilities (Details Narrative) $ in ThousandsJun. 30, 2019USD ($)
Payables and Accruals [Abstract]
Short term debt $ 200

Accounts Payable and Accrued _4

Accounts Payable and Accrued Expenses and Other Current Liabilities - Schedule of Accounts Payable and Accrued Expenses (Details) - USD ($) $ in ThousandsJun. 30, 2019Dec. 31, 2018
Payables and Accruals [Abstract]
Accounts payable $ 2,122 $ 2,918
Salaries and other compensation1,655 1,280
Legal and accounting1,382 640
Other accruals818 1,670
Total accounts payable and accrued expenses $ 5,977 $ 6,508

Long Term Note Payable (Details

Long Term Note Payable (Details Narrative) - USD ($) $ in Thousands1 Months Ended3 Months Ended6 Months Ended
May 31, 2018Jun. 30, 2019Jun. 30, 2019Jun. 30, 2018Dec. 31, 2018
Unamortized debt discount $ 41 $ 41 $ 68
Amortization of debt discount $ 13 28 $ 11
Promissory Note [Member]
Promissory note payable $ 1,300
Interest rate3.50%
Maturity dateNov. 3,
2020
Accelerated interest rate7.00%
Interest expenses $ 113
Ibex Group, L.L.C [Member] | Promissory Note [Member]
Initial fair value of liabilities $ 1,200

Preferred Shares and Common S_3

Preferred Shares and Common Shares (Details Narrative) - USD ($)Mar. 06, 2018Mar. 05, 2018Feb. 06, 2018Sep. 20, 2017Jun. 30, 2019Jun. 30, 2018Dec. 31, 2018Apr. 10, 2018Sep. 30, 2017
Sale of stock price, per share $ 8.51
Warrant term2 years
Warrant exercise price per share $ 30
Fair value of warrants $ 2,525,567
Conversion of stock shares issued, value $ 3,045,034
Preferred stock, shares authorized25,000,000 25,000,000
Convertible preferred stock, shares outstanding0 0
Warrant Liability [Member]
Gain/loss on extinguishment of warrant liability $ 519,467
6% Series F Convertible Preferred Stock [Member]
Preferred stock, stated value per share $ 2,750
Preferred stock initial conversion price, per share $ 27.50
6% Series F Convertible Preferred Stock [Member] | Accredited Investors [Member]
Sales of stock amount $ 17,750,000
Sale of stock price, per share $ 2,750
Preferred stock, stated value per share $ 0.001
Conversion of stock shares converted100
Warrant term2 years
Warrants to purchase shares of common stock322,727
Warrant exercise price per share $ 30
Series F Preferred Stock [Member]
Warrants to purchase shares of common stock322,727
Description on certificate of designationOn the two-year anniversary of the initial issuance date, any Series F Preferred Shares outstanding and not otherwise already converted, would, at the option of the holder, either (i) automatically convert into common stock of the Company at the conversion price then in effect or (ii) be repaid by the Company based on the stated value of such outstanding Series F Preferred Shares.
Fair value of warrants $ 4,300,000
Bifurcated embedded conversion feature9,300,000
Preferred stock dividends $ 13,600,000
Beneficially ownership percentage100.00%
Preferred stock reduction in additional paid in capital $ 698,000
Series F Preferred Stock [Member] | Restricted Stock [Member]
Conversion of stock shares converted972,070
Conversion price, per share $ 18.26
Preferred stock dividend percentage6.00%
Conversion of preferred stock into common stock, number shares issued31,321
Series F Preferred Stock [Member] | Restricted Stock [Member] | Warrant [Member]
Conversion of preferred stock into common stock, number shares issued151,871
Series B Preferred Shares [Member]
Conversion of stock shares converted15,756
Beneficially ownership percentage100.00%
Conversion of preferred stock into common stock, number shares issued7,945,250 262,606
Series A Preferred Shares [Member]
Beneficially ownership percentage100.00%
Conversion of preferred stock into common stock, number shares issued7,945,250
Series E Preferred Shares [Member]
Beneficially ownership percentage100.00%
Series E Preferred Shares [Member]
Conversion of preferred stock into common stock, number shares issued7,945,250
Series E Preferred Shares [Member] | Lough Registration Rights Agreement [Member]
Conversion of preferred stock into common stock, number shares issued7,050,000

Preferred Shares and Common S_4

Preferred Shares and Common Shares - Schedule of Deemed Dividend on Preferred Shares Exchange (Details)6 Months Ended
Jun. 30, 2019USD ($)
Equity [Abstract]
Fair market value of 1,003,393 shares of common stock issued at $20.05 (Company's closing stock price on March 5, 2018) in exchange for Series F Preferred Shares and accrued dividends $ 20,117,990
Carrying value of Series F Preferred Shares at March 5, 2018, including dividends(5,898,274)
Carrying value of bifurcated conversion option at March 5, 2018(7,162,587)
Deemed dividend on Series F Preferred Shares exchange $ 7,057,129

Preferred Shares and Common S_5

Preferred Shares and Common Shares - Schedule of Deemed Dividend on Preferred Shares Exchange (Details) (Parenthetical) - Series F Preferred Stock [Member]Mar. 05, 2018$ / sharesshares
Fair market value of common stock issued, shares | shares1,003,393
Common stock price per share | $ / shares $ 20.05

Stock-Based Compensation (Detai

Stock-Based Compensation (Details Narrative) - USD ($) $ in ThousandsOct. 05, 2018Dec. 01, 2017May 31, 2018Jun. 30, 2019Jun. 30, 2019Oct. 31, 2017
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of stock issued under ESPP, value $ 35
2019 Equity Incentive Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock based compensation terminate dateOct. 5,
2028
Number of share available for future issuance1,857,972 1,857,972
2019 Equity Incentive Plan [Member] | Maximum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of stock issuable3,000,000
2017 Equity Incentive Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of stock issuable3,450,000
Stock based compensation terminate dateDec. 1,
2026
Number of share available for future issuance374,038 374,038
2017 Equity Incentive Plan [Member] | Maximum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of stock issuable7,300,000
Employee Stock Purchase Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares reserved500,000
Common stock purchase price percentage85.00%
Number of stock issued under ESPP7,260
Number of stock issued under ESPP, value $ 35

Stock-Based Compensation - Sche

Stock-Based Compensation - Schedule of Share-based Compensation Related to Restricted Stock Awards and Stock Options (Details) - USD ($) $ in Thousands3 Months Ended6 Months Ended
Jun. 30, 2019Jun. 30, 2018Jun. 30, 2019Jun. 30, 2018
General and administrative expense $ 15,060 $ 11,290 $ 32,255 $ 18,863
Research and development expense4,764 2,915 10,116 8,488
Sales and marketing expense3,981 7,934
Total stock-based compensation expense18,907 15,789
Restricted Stock Awards and Stock Options [Member]
General and administrative expense6,892 7,035 15,929 12,807
Research and development expense1,481 1,309 2,565 2,982
Sales and marketing expense245 413
Total stock-based compensation expense $ 8,618 $ 8,344 $ 18,907 $ 15,789

Stock-Based Compensation - Sc_2

Stock-Based Compensation - Schedule of Share-based Compensation, Stock Options, Activity (Details) - Employee Stock Option [Member]6 Months Ended
Jun. 30, 2019$ / sharesshares
Number of Shares, Outstanding at beginning of period | shares6,499,885
Number of Shares, Granted | shares767,201
Number of Shares, Exercised | shares(292,417)[1]
Number of Shares, Forfeited | shares(370,208)
Number of Shares, Outstanding at end of period | shares6,604,461
Number of Shares, Options exercisable | shares4,567,527
Weighted Average Exercise Price, Outstanding at beginning of year $ 14.02
Weighted Average Exercise Price, Granted14.36
Weighted Average Exercise Price, Exercised3.99[1]
Weighted Average Exercise Price, Forfeited7.81
Weighted Average Exercise Price, Outstanding at end of year14.30
Weighted Average Exercise Price, Options exercisable12.11
Weighted-average fair value of options granted during the period $ 10.28
[1]The number of exercised options includes shares withheld on behalf of employees to satisfy minimum statutory tax withholding requirements.

Stock-Based Compensation - Sc_3

Stock-Based Compensation - Schedule of Share-based Compensation, Restricted Stock Activity (Details) - Restricted Stock and Restricted Stock Units [Member]6 Months Ended
Jun. 30, 2019$ / sharesshares
Number of Shares, Unvested at beginning of period | shares651,110
Number of Shares, Granted | shares75,000
Number of Shares, Vested | shares(187,663)[1]
Number of Shares, Forfeited | shares(45,000)
Number of Shares, Unvested at end of period | shares493,447
Weighted-Average Grant-Date Fair Value Unvested at beginning of period | $ / shares $ 23.65
Weighted-Average Grant-Date Fair Value, Granted | $ / shares10.97
Weighted-Average Grant-Date Fair Value, Vested | $ / shares28.83[1]
Weighted-Average Grant-Date Fair Value, Forfeited | $ / shares22.46
Weighted-Average Grant-Date Fair Value, Unvested at end of period | $ / shares $ 22.66
[1]The number of vested restricted stock units includes shares that were withheld on behalf of employees to satisfy the minimum statutory tax withholding requirements.

Loss Per Share - Schedule of An

Loss Per Share - Schedule of Anti-dilutive Potential Shares Outstanding Activity (Details) - shares6 Months Ended
Jun. 30, 2019Jun. 30, 2018
Stock Options [Member]
Antidilutive shares6,604,461 5,523,068
Restricted Stock [Member]
Antidilutive shares493,447 332,089

Certain Relationships and Rel_2

Certain Relationships and Related Transactions (Details Narrative)1 Months Ended3 Months Ended6 Months Ended
Oct. 31, 2018USD ($)aJun. 30, 2019USD ($)aft²Jun. 30, 2019USD ($)aft²Dec. 31, 2018USD ($)
Lease rental square feet | a6,232 6,232
Monthly lease payment $ 31,160
Sublease income $ 51,000 126,000
Due from related party $ 102,000 $ 102,000 $ 0
Cohen LLC [Member]
Lease rental square feet | a4,584 4,584
Monthly lease payment $ 22,920
Parent Company [Member]
Lease rental square feet | ft²1,648 1,648
Office Lease [Member]
Lease rental square feet | a7,250
Lease term3 years
Annual lease rate $ 60
Operating leases, descriptionInitially the Company will occupy and pay for only 3,275 square feet of space, and the Company is not obligated under the lease to pay for the remaining 3,975 square feet covered by the lease unless we elect to occupy that additional space.

Segment Reporting (Details Narr

Segment Reporting (Details Narrative)6 Months Ended
Jun. 30, 2019Segment
Segment Reporting [Abstract]
Number of operating segment2

Segment Reporting - Schedule of

Segment Reporting - Schedule of Segment Information (Details) - USD ($) $ in Thousands3 Months Ended6 Months Ended
Jun. 30, 2019Mar. 31, 2019Jun. 30, 2018Mar. 31, 2018Jun. 30, 2019Jun. 30, 2018
Total net revenues $ 1,326 $ 320 $ 2,791 $ 323
Total net loss(22,792) $ (25,573)(14,000) $ (11,777)(48,365)(25,777)
Regenerative Medicine [Member]
Total net revenues504 189 801 192
Total net loss(23,014)(13,843)(48,782)(25,620)
Contract Services [Member]
Total net revenues822 131 1,990 131
Total net loss $ 222 $ (157) $ 417 $ (157)

Subsequent Events (Details Narr

Subsequent Events (Details Narrative) - USD ($)Aug. 06, 2019Jun. 28, 2019Jun. 30, 2019Mar. 31, 2019
Number of restricted shares award received
2019 Equity Incentive Plan [Member]
Restricted stock award descriptionIn consideration for the agreement by each member of the Office of the Chief Executive to reduce his cash salary, the Compensation Committee of the Board of Directors approved granting restricted stock awards to them on July 1, 2019, under the Company's 2019 Equity Incentive Plan. Mr. Hague's restricted stock award is for 129,825 common shares that are restricted from transfer by reference to continued employment by the Company, and the restriction on transfer lapses with respect to 10,819 shares in August 2019 and the remainder in monthly installments through June 2021. Mr. Mann's restricted stock award is for 140,351 common shares that are restricted from transfer by reference to continued employment by the Company, and the restriction on transfer lapses with respect to 29,240 shares in December 2019 and the remainder in monthly installments through June 2021. Mr. Seaburg's restricted stock award is for 114,035 common shares that are restricted from transfer by reference to continued employment by the Company, and the restriction on transfer lapses with respect to 23,814 shares in December 2019 and the remainder in monthly installments through June 2021.
Chief Operating Officer, Chief Financial Officer and President of Corporate Development [Member] | 2019 Equity Incentive Plan [Member] | Subsequent Event [Member]
Number of restricted shares award received $ 175,000
Stock award vesting period descriptionEach of them received an award of 175,000 shares that vests in six installments every six months over a period of three years subject to continued employment.
Vesting period3 years
Employment Agreements [Member]
Compensation descriptionEmployment agreements with the members of its Office of the Chief Executive, which includes Richard Hague, Chief Operating Officer, Paul Mann, Chief Financial Officer, and David Seaburg, President of Corporate Development. Mr. Hague agreed to reduce his base cash salary by 50% from $370,000 to $185,000 per year over a two-year period beginning July 1, 2019. Mr. Mann agreed to reduce his base cash salary by 50% from $400,000 to $200,000 per year over a two-year period beginning July 1, 2019. Mr. Seaburg agreed to reduce his base cash salary by 50% from $325,000 to $162,500 per year over a two-year period beginning July 1, 2019.
Employment Agreements [Member] | Richard Hague [Member]
Percentage of base salary reduced50.00%
Base salary $ 370,000
Employment Agreements [Member] | Richard Hague [Member] | July 1, 2019 to June 30, 2021 [Member]
Reduced amount of base salary $ 185,000
Employment Agreements [Member] | Paul Mann [Member]
Percentage of base salary reduced50.00%
Base salary $ 400,000
Employment Agreements [Member] | Paul Mann [Member] | July 1, 2019 to June 30, 2021 [Member]
Reduced amount of base salary $ 200,000
Employment Agreements [Member] | David Seaburg [Member]
Percentage of base salary reduced50.00%
Base salary $ 325,000
Employment Agreements [Member] | David Seaburg [Member] | July 1, 2019 to June 30, 2021 [Member]
Reduced amount of base salary $ 162,500