Cover Page
Cover Page - shares | 3 Months Ended | |
Aug. 31, 2022 | Sep. 30, 2022 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Aug. 31, 2022 | |
Entity File Number | 000-49908 | |
Entity Registrant Name | CYTODYN INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 83-1887078 | |
Entity Address, Address Line One | 1111 Main Street | |
Entity Address, Address Line Two | Suite 660 | |
Entity Address, City or Town | Vancouver | |
Entity Address, State or Province | WA | |
Entity Address, Postal Zip Code | 98660 | |
City Area Code | 360 | |
Local Phone Number | 980-8524 | |
Title of 12(b) Security | None | |
No Trading Symbol Flag | true | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 812,825,217 | |
Current Fiscal Year End Date | --05-31 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q1 | |
Entity Central Index Key | 0001175680 | |
Amendment Flag | false |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Aug. 31, 2022 | May 31, 2022 |
Current assets: | ||
Cash | $ 4,676 | $ 4,231 |
Prepaid expenses | 4,143 | 5,198 |
Prepaid service fees | 1,038 | 1,086 |
Total current assets | 9,857 | 10,515 |
Inventories, net | 17,929 | 17,929 |
Other non-current assets | 608 | 741 |
Total assets | 28,394 | 29,185 |
Current liabilities: | ||
Accounts payable | 68,991 | 67,974 |
Accrued liabilities and compensation | 5,014 | 8,995 |
Accrued interest on convertible notes | 7,120 | 5,974 |
Accrued dividends on convertible preferred stock | 4,361 | 3,977 |
Convertible notes payable, net | 36,833 | 36,241 |
Total current liabilities | 122,319 | 123,161 |
Long-term liabilities: | ||
Operating leases | 387 | 422 |
Total liabilities | 122,706 | 123,583 |
Commitments and Contingencies (Note 9) | ||
Stockholders' (deficit) equity: | ||
Common stock, $0.001 par value; 1,350,000 shares authorized; 812,698 and 720,028 issued, and 812,255 and 719,585 outstanding at August 31, 2022 and May 31, 2022, respectively | 813 | 720 |
Additional paid-in capital | 687,732 | 671,013 |
Accumulated deficit | (782,857) | (766,131) |
Total stockholders' (deficit) | (94,312) | (94,398) |
Total liabilities and stockholders' (deficit) | 28,394 | 29,185 |
Series B Convertible Preferred Stock | ||
Stockholders' (deficit) equity: | ||
Preferred stock | ||
Series C Convertible Preferred Stock | ||
Current liabilities: | ||
Accrued dividends on convertible preferred stock | 2,186 | 2,014 |
Stockholders' (deficit) equity: | ||
Preferred stock | ||
Series D Convertible Preferred Stock | ||
Current liabilities: | ||
Accrued dividends on convertible preferred stock | 2,175 | 1,963 |
Stockholders' (deficit) equity: | ||
Preferred stock |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares shares in Thousands | Aug. 31, 2022 | May 31, 2022 |
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 5,000 | 5,000 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 1,350,000 | 1,350,000 |
Common stock, shares issued | 812,698 | 720,028 |
Common stock, shares outstanding | 812,255 | 719,585 |
Treasury stock, shares | 443 | 443 |
Series B Convertible Preferred Stock | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 400 | 400 |
Preferred stock, shares issued | 19 | 19 |
Preferred stock, shares outstanding | 19 | 19 |
Series C Convertible Preferred Stock | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 8 | 8 |
Preferred stock, shares issued | 6 | 7 |
Preferred stock, shares outstanding | 6 | 7 |
Series D Convertible Preferred Stock | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 12 | 12 |
Preferred stock, shares issued | 9 | 9 |
Preferred stock, shares outstanding | 9 | 9 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |||
Aug. 31, 2022 | Aug. 31, 2021 | |||
Consolidated Statements of Operations | ||||
Revenue | [1] | $ 41 | ||
Cost of goods sold | [1] | 1 | ||
Gross margin | [1] | 40 | ||
Operating expenses: | ||||
General and administrative | $ 6,333 | 7,617 | [1] | |
Research and development | 576 | 12,020 | [1] | |
Amortization and depreciation | 99 | 276 | [1] | |
Inventory charge | 2,704 | 1,764 | [1] | |
Total operating expenses | 9,712 | 21,677 | [1] | |
Operating loss | (9,712) | (21,637) | [1] | |
Interest and other expense: | ||||
Interest on convertible notes | (1,146) | (1,686) | [1] | |
Amortization of discount on convertible notes | (576) | (952) | [1] | |
Amortization of debt issuance costs | (16) | (28) | [1] | |
Loss on induced conversion | [1] | (18,530) | ||
Finance charges | (940) | (35) | [1] | |
Inducement interest expense | [1] | (528) | ||
Legal settlement | [1] | (1,941) | ||
Loss on derivatives | (8,601) | |||
Total interest and other expense | (11,279) | (23,700) | [1] | |
Loss before income taxes | (20,991) | (45,337) | [1] | |
Income tax benefit | 0 | 0 | [1] | |
Net loss | $ (20,991) | $ (45,337) | [1] | |
Weighted average common shares outstanding, Basic | 787,856 | 632,597 | [1] | |
Weighted average common shares outstanding, Diluted | 787,856 | 632,597 | ||
Loss per share, Basic | $ (0.03) | $ (0.07) | [1] | |
Loss per share, Diluted | $ (0.03) | $ (0.07) | ||
[1] See Note 2, Summary of Significant Accounting Policies . |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' (Deficit) - USD ($) shares in Thousands, $ in Thousands | Preferred Stock Series C Convertible Preferred Stock | Preferred Stock | Common Stock Series C Convertible Preferred Stock | Common Stock Private Warrant Exchange [Member] | Common Stock Private Equity Offering | Common Stock | Treasury Stock | Additional Paid-in Capital Series C Convertible Preferred Stock | Additional Paid-in Capital Private Warrant Exchange [Member] | [1] | Additional Paid-in Capital Private Equity Offering | Additional Paid-in Capital | Accumulated Deficit | Private Warrant Exchange [Member] | [1] | Private Equity Offering | Total | ||||||
Beginning balance at May. 31, 2021 | $ 626 | $ 532,031 | [1] | $ (553,675) | [1] | $ (21,018) | [1] | ||||||||||||||||
Beginning balance (shares) at May. 31, 2021 | 96 | 626,123 | 443 | ||||||||||||||||||||
Issuance of stock for convertible note repayment | $ 12 | 13,832 | [1] | 13,844 | [1] | ||||||||||||||||||
Issuance of stock for convertible note repayment (in shares) | 11,816 | ||||||||||||||||||||||
Loss on induced conversion | 18,530 | [1] | 18,530 | [2] | |||||||||||||||||||
Issuance of legal settlement, warrants | [1] | 1,744 | 1,744 | ||||||||||||||||||||
Stock option exercises | [1] | 189 | 189 | ||||||||||||||||||||
Stock option exercises (in shares) | 300 | ||||||||||||||||||||||
Stock issued for bonuses and tendered for income tax | $ 1 | (1) | [1] | ||||||||||||||||||||
Stock issued for bonuses and tendered for income tax (in shares) | 1,014 | ||||||||||||||||||||||
Stock issued for private offerings | $ 3 | $ 2,869 | [1] | $ 2,872 | [1] | ||||||||||||||||||
Stock issued for private offerings (in shares) | 2,872 | ||||||||||||||||||||||
Warrant exercises | $ 1 | $ 1 | $ 774 | 502 | [1] | $ 775 | 503 | [1] | |||||||||||||||
Warrant exercises (in shares) | 1,327 | 668 | |||||||||||||||||||||
Inducement interest expense related to private warrant exchange | [1] | 528 | 528 | ||||||||||||||||||||
Accrued preferred stock dividends | [1] | (420) | (420) | ||||||||||||||||||||
Stock-based compensation | [1] | 2,597 | 2,597 | ||||||||||||||||||||
Net loss | (45,337) | [1] | (45,337) | [2] | |||||||||||||||||||
Ending balance at Aug. 31, 2021 | $ 644 | 573,595 | [1] | (599,432) | [1] | (25,193) | [1] | ||||||||||||||||
Ending balance (shares) at Aug. 31, 2021 | 96 | 644,120 | 443 | ||||||||||||||||||||
Beginning balance at May. 31, 2021 | $ 626 | 532,031 | [1] | (553,675) | [1] | (21,018) | [1] | ||||||||||||||||
Beginning balance (shares) at May. 31, 2021 | 96 | 626,123 | 443 | ||||||||||||||||||||
Ending balance at May. 31, 2022 | $ 720 | 671,013 | (766,131) | (94,398) | |||||||||||||||||||
Ending balance (shares) at May. 31, 2022 | 35 | 720,028 | 443 | ||||||||||||||||||||
Stock issued for compensation | $ 1 | 344 | $ 345 | ||||||||||||||||||||
Stock issued for compensation (in shares) | 879 | ||||||||||||||||||||||
Stock issued for private offerings | $ 85 | $ 17,459 | $ 17,544 | ||||||||||||||||||||
Stock issued for private offerings (in shares) | 85,378 | 4,600 | |||||||||||||||||||||
Issuance costs related to stock issued for private offerings | (6,289) | $ (6,289) | |||||||||||||||||||||
Conversion of Series C convertible preferred stock to common stock | $ 1 | $ (1) | |||||||||||||||||||||
Conversion of Series C convertible preferred stock to common stock (in shares) | (1) | 1,136 | |||||||||||||||||||||
Warrant exercises | $ 1 | 263 | $ 264 | ||||||||||||||||||||
Warrant exercises (in shares) | 657 | 500 | |||||||||||||||||||||
Deemed dividend paid in common stock due to down round provision, recorded in additional paid-in capital | $ 5 | (5) | |||||||||||||||||||||
Deemed dividend paid in common stock due to down round provision recorded in additional paid-in capital (in share) | 4,620 | ||||||||||||||||||||||
Accrued preferred stock dividends | (384) | $ (384) | |||||||||||||||||||||
Change of fair value of liability-classified equity instrument upon reclassification | 8,601 | 8,601 | |||||||||||||||||||||
Stock-based compensation | 996 | 996 | |||||||||||||||||||||
Reclassification to additional paid-in capital of prior period preferred stock dividends previously charged to accumulated deficit | (4,265) | 4,265 | |||||||||||||||||||||
Net loss | (20,991) | (20,991) | |||||||||||||||||||||
Ending balance at Aug. 31, 2022 | $ 813 | $ 687,732 | $ (782,857) | $ (94,312) | |||||||||||||||||||
Ending balance (shares) at Aug. 31, 2022 | 34 | 812,698 | 443 | ||||||||||||||||||||
[1] See Note 2, Summary of Significant Accounting Policies . See Note 2, Summary of Significant Accounting Policies . |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||
Aug. 31, 2022 | Aug. 31, 2021 | May 31, 2022 | ||||
Cash flows from operating activities: | ||||||
Net loss | $ (20,991) | $ (45,337) | [1] | |||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||
Amortization and depreciation | 99 | 276 | [1] | |||
Amortization of debt issuance costs | 16 | 28 | [1] | |||
Amortization of discount on convertible notes | 576 | 952 | [1] | |||
Legal settlement | [1] | 1,744 | ||||
Loss on derivatives | 8,601 | |||||
Loss on induced conversion | [1] | 18,530 | ||||
Inducement interest expense and non-cash finance charges | [1] | 528 | ||||
Inventory charge | 2,704 | 1,764 | [1] | |||
Stock-based compensation | 1,341 | 2,597 | [1] | |||
Changes in operating assets and liabilities: | ||||||
(Increase) in prepaid expenses and other assets | (1,601) | (2,370) | [1] | |||
(Decrease) in accounts payable and accrued expenses | (1,819) | (10,453) | [1] | |||
Net cash used in operating activities | (11,074) | (31,741) | [1] | |||
Cash flows from investing activities: | ||||||
Furniture and equipment purchases | [1] | (8) | ||||
Net cash used in investing activities | [1] | (8) | ||||
Cash flows from financing activities: | ||||||
Proceeds from warrant transactions, net of offering costs | [1] | 775 | ||||
Proceeds from sale of common stock and warrants, net of issuance costs | 11,255 | 2,872 | [1] | |||
Proceeds from warrant exercises | 264 | 503 | [1] | |||
Exercise of option to repurchase shares held in escrow | [1] | 9 | ||||
Proceeds from stock option exercises | [1] | 189 | ||||
Net cash provided by financing activities | 11,519 | 4,348 | [1] | |||
Net change in cash and restricted cash | 445 | (27,401) | [1] | |||
Cash beginning of period | 4,231 | 33,943 | [1] | $ 33,943 | [1] | |
Cash end of period | 4,676 | 6,542 | [1] | 4,231 | ||
Cash and restricted cash consisted of the following: | ||||||
Cash | 4,676 | 6,533 | [1] | 4,231 | ||
Restricted cash | [1] | 9 | ||||
Total cash and restricted cash | 4,676 | 6,542 | [1] | $ 4,231 | ||
Supplemental disclosure: | ||||||
Cash paid for interest | [1] | 35 | ||||
Non-cash investing and financing transactions: | ||||||
Issuance of common stock for principal and interest of convertible notes | [1] | 14,950 | ||||
Accrued dividends on convertible Series C and D Preferred Stock | 384 | $ 420 | [1] | |||
Common stock issued due to round-down provision | $ 4,154 | |||||
[1] See Note 2, Summary of Significant Accounting Policies . |
Organization
Organization | 3 Months Ended |
Aug. 31, 2022 | |
Organization | |
Organization | Note 1. Organization CytoDyn Inc. (together with its wholly owned subsidiaries, the “Company”) was originally incorporated under the laws of Colorado on May 2, 2002, under the name RexRay Corporation and, effective August 27, 2015, reincorporated under the laws of Delaware. The Company is a clinical-stage biotechnology company focused on the clinical development of innovative treatments for multiple therapeutic indications based on its product candidate, leronlimab (PRO 140), a novel humanized monoclonal antibody targeting the CCR5 receptor. The Company is studying leronlimab in human immunodeficiency virus (“HIV”), oncology, and non-alcoholic steatohepatitis (“NASH”). Leronlimab is being investigated as a viral entry inhibitor for HIV, believed to competitively bind to the N-terminus and second extracellular loop of the CCR5 receptor. For immunology, the CCR5 receptor is believed to be implicated in immune-mediated illnesses such as NASH. Leronlimab is being studied in NASH, oncology, and other therapeutic indications where CCR5 is believed to play an integral role. The Company has pursued the regulatory approval of leronlimab in hopes that commercial sales will be obtained based on positive data from its Phase 2b/3 clinical trial for leronlimab as a combination therapy with highly active antiretroviral therapy (“HAART”) for highly treatment-experienced HIV patients, as well as information gathered from meetings with the U.S. Food and Drug Administration (“FDA”) related to its Biologic License Application (“BLA”) for this indication. In July 2020, the Company received a Refusal to File letter from the FDA regarding its BLA submission for leronlimab as a combination therapy with HAART for highly treatment-experienced HIV patients. The FDA informed the Company that the BLA did not contain certain information and data needed to complete a substantive review and therefore, the FDA would not file the BLA. The deficiencies cited by the FDA included administrative deficiencies, omissions, corrections to data presentation and related analyses, and clarifications regarding the manufacturing processes. In November 2021, the Company resubmitted the non-clinical and chemistry, manufacturing, and controls (“CMC”) sections of the BLA. As of March 2022, the FDA had commenced its review of the CMC section. As described in Note 9, Commitments and Contingencies - Legal Proceedings Additionally, in March of 2022, the FDA placed the HIV program on a partial clinical hold, which may affect our ability to resubmit the BLA. The Company is in the process of evaluating the data, results of the audit, and implications of the partial clinical hold. The Company will update the feasibility of the resubmission of the clinical section of the BLA once it completes its evaluation. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Aug. 31, 2022 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | Note 2. Summary of Significant Accounting Policies Basis of Presentation The unaudited interim consolidated financial statements include the accounts of CytoDyn Inc. and its wholly owned subsidiaries, CytoDyn Operations Inc. and Advanced Genetic Technologies, Inc. (“AGTI”); AGTI is a dormant entity. The consolidated financial statements reflect all normal recurring adjustments which are, in the opinion of management, necessary for a fair statement of the results of operations for the interim financial statements. The interim financial information and notes thereto should be read in conjunction with the Company's latest Annual Report on Form 10-K for the fiscal year ended May 31, 2022 (the “2022 Form 10-K”) The results of operations for the periods presented are not necessarily indicative of results to be expected for the entire fiscal year or for any other future annual or interim period. Reclassifications Certain prior year and prior quarter amounts shown in the accompanying consolidated financial statements have been reclassified to conform to the current period presentation. Such reclassifications did not have material effect on the Company’s previously reported financial position, results of operations, stockholders’ deficit, or net cash provided by operating activities. During the quarter ended August 31, 2022, the Company reclassified amounts recorded as accumulated dividends for Series C and D preferred stockholders from accumulated deficit to additional paid-in capital. These reclassifications were made to reflect the proper presentation for accrued dividends when an entity has accumulated deficit. Revision and Restatement of Financial Statements During the preparation of the quarterly financial statements as of and for the period ended November 30, 2021, the Company identified an error in how non-cash inducement interest expense was calculated in previous reporting periods dating back to fiscal year 2018. The error resulted in an understatement of non-cash inducement interest expense and additional paid-in capital. For details, refer to Note 2, Summary of Significant Accounting Policies - Revision of Financial Statements Restatement Going Concern The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. As presented in the accompanying consolidated financial statements, the Company had losses for all periods presented. The Company incurred a net loss of approximately $21.0 million for the three months ended August 31, 2022, and has an accumulated deficit of approximately $782.9 million as of August 31, 2022. These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern. The consolidated financial statements do not include any adjustments relating to the recoverability of assets and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. The Company’s continuation as a going concern is dependent upon its ability to obtain additional operating capital, complete the development of its product candidate, leronlimab, obtain approval to commercialize leronlimab from regulatory agencies, continue to outsource manufacturing of leronlimab, and ultimately achieve revenues and attain profitability. The Company plans to continue to engage in research and development activities related to leronlimab for multiple indications and expects to incur significant research and development expenses in the future primarily related to its regulatory compliance and approval, and clinical trials. These research and development activities are subject to significant risks and uncertainties. The Company intends to finance its future development activities and its working capital needs primarily from the sale of equity and debt securities, combined with additional funding from other sources. However, there can be no assurance that the Company will be successful in these endeavors. Use of Estimates The preparation of the consolidated financial statements in accordance with accounting principles generally accepted in the United States (U.S. GAAP) requires management to make estimates and judgments that affect the reported amounts of assets, liabilities, and the disclosure of contingent assets and liabilities at the date of consolidated financial statements, and the reported amounts of revenue and expenses during the reporting period. Estimates are assessed each period and updated to reflect current information, such as the status of our analysis of the results of our clinical trials and/or discussions with the FDA which could have an impact on the Company’s significant accounting estimates and assumptions. The Company’s estimates are based on historical experience and on various market and other relevant, appropriate assumptions. Significant estimates include, but are not limited to, those relating to stock-based compensation, capitalization of pre-launch inventories, write-off for excess and obsolete inventories, research and development expenses, commitments and contingencies, and the assumptions used to value warrants and warrant modifications. Actual results could differ from these estimates. Pre-launch Inventories Pre-launch inventories are comprised of raw materials required to commercially produce leronlimab and substantially completed commercially produced leronlimab in anticipation of commercial sales of the product upon potential regulatory approval as a combination therapy for HIV patients in the United States. The Company’s pre-launch inventories consist of (1) raw materials purchased for commercial production, (2) work-in-progress materials which consist of bulk drug substance, which is the manufactured drug stored in bulk storage, and (3) drug product, which is the manufactured drug in unlabeled vials. The consumption of raw materials during production is classified as work-in-progress until saleable. Once it is determined to be in saleable condition, following regulatory approval, inventory is classified as finished goods. The Company capitalizes inventories procured or produced in preparation for product launches. Typically, capitalization of such inventory begins when the results of clinical trials have reached a status sufficient to support regulatory approval, uncertainties regarding ultimate regulatory approval have been significantly reduced, and the Company has determined it is probable that these capitalized costs will provide future economic benefit in excess of capitalized costs. The material factors considered by the Company in evaluating these uncertainties include the receipt and analysis of positive Phase 3 clinical trial results for the underlying product candidate, results from meetings with the relevant regulatory authorities prior to the filing of regulatory applications, and status of the Company’s regulatory applications. The Company closely monitors the status of the product within the regulatory review and approval process, including all relevant communications with regulatory authorities. If the Company becomes aware of any specific material risks or contingencies other than the normal regulatory review and approval process or if there are any specific issues identified relating to safety, efficacy, manufacturing, marketing or labeling, it may make a determination that the related inventory no longer qualifies for capitalization. The Company determines whether raw materials purchased for commercial production are usable for production based on the manufacturer’s assigned expiration date. In evaluating whether raw materials included in the pre-launch inventories will be usable for production, the Company takes into account the shelf-life of raw materials at the time they are expected to be used in manufacturing. Any raw materials past expiration date at the time of the next manufacturing run are removed from inventory. As one stage of the manufacturing process, the Company produces work-in-progress materials which consist of bulk drug substance, which is the manufactured drug stored in bulk storage. The initial shelf-life of bulk drug substance is established based on prior experience and periodically performed stability studies and is set at four years from the date of manufacturing. Bulk drug substance is subject to deep freeze storage, and stability studies are performed on a periodic basis in accordance with the established stability protocols. If drug substance meets suitability criteria beyond the initial shelf-life, its shelf-life may be extended based on prior experience and stability trend analysis, and during the extension period periodic stability testing is performed on the drug substance. Regardless of the number of stability studies performed, if drug substance continues to meet prespecified suitability parameters it may be used in manufacturing; if drug substance fails to meet suitability criteria beyond its assigned shelf-life at that time, it may no longer be used and is considered to be expired. The Company utilizes resins, a reusable raw material, in its bulk drug manufacturing process. Shelf-life of a resin used in commercial manufacturing of biologics is determined by the number of cycles for which it has been validated to be used in a manufacturing process before it is considered unusable. Unpacked and unused resins have a manufacturer’s expiration date by which resins are expected to start being used in the manufacturing process without loss of their properties. Prior to a new manufacturing campaign, and between manufacturing campaigns, the resins are removed from storage, and are treated and tested for suitability. Once resins are used in the manufacturing process, their shelf-life is measured by a validated predetermined number of manufacturing cycles they are usable for, conditional on appropriate storage solution under controlled environment between production campaigns, as well as by performing pre-production usability testing. Before a manufacturing campaign, each resin is tested for suitability. Regardless of the number of cycles, if a resin fails to meet prespecified suitability parameters it may not be used in manufacturing; likewise, even if the resin meets suitability criteria beyond the lifetime cycles, it may no longer be used. The cost of the resins used in a manufacturing campaign is allocated to the cost of the drug product in vials. The Company values its inventory at the lower of cost or net realizable value using the average cost method. Inventory is evaluated for recoverability by considering the likelihood that revenue will be obtained from the future sale of the related inventory considering the status of the product within the regulatory approval process. The Company evaluates its inventory levels on a quarterly basis and writes down inventory that became obsolete, has a cost in excess of its expected net realizable value, or is in quantities in excess of expected requirements. In assessing the lower of cost or net realizable value for pre-launch inventory, the Company relies on independent analyses provided by third parties knowledgeable about the range of likely commercial prices comparable to current comparable commercial product. Quarterly, the Company also evaluates whether certain raw materials held in its inventory are expected to reach the end of their estimated shelf-lives based on passage of time, the number of manufacturing cycles they are used in and results of pre-production testing prior to the expected production date, or when resins used in the manufacturing process fail suitability tests. If any of such events occur, the Company may make a determination to record a charge if it is expected that such inventories will become obsolete prior to the expected production date. Anticipated future sales, shelf lives, and expected approval date are considered when evaluating realizability of capitalized inventory. The shelf-life of a product is determined as part of the regulatory approval process; however, in assessing whether to capitalize pre-launch inventories, the Company considers the product stability data for all of the pre-approval inventory procured or produced to date to determine whether there is adequate shelf-life. When the remaining shelf-life of drug product inventory is less than 12 months, it is likely that it will not be accepted by potential customers. However, as inventories approach their shelf-life expiration, the Company may perform additional stability testing to determine if the inventory is still viable, which can result in an extension of its shelf-life and revaluation of the need for and the amount of the previously recorded reserves. Further, in addition to performing additional stability testing, certain raw materials inventory may be sold in its then current condition prior to reaching expiration. If the Company determines that it is not likely that shelf-life may be extended or the inventory cannot be sold prior to expiration, the Company may record a charge to bring inventory to its net realizable value. For additional information about the Company’s significant accounting policies, refer to Note 2, Summary of Significant Accounting Policies, Recently Adopted Accounting Pronouncements In August 2020, the FASB issued ASU No. 2020-06, Debt with Conversion and Other Options (Subtopic 470-20) Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40) In May 2021, the FASB issued ASU No. 2021-04, Earnings Per Share (Topic 260), Debt—Modifications and Extinguishments (Subtopic 470-50), Compensation - Stock Compensation (Topic 718), and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options The Company adopted the new guidance prospectively as of June 1, 2022 and used the framework to record a modification to the exercise price of equity classified warrants during the three months ended August 31, 2022. The incremental value of modification to equity instruments as a result of a trigger of a down round provision was recorded as a deemed dividend in accordance with this guidance, resulting in an approximate $4.2 million charge to additional paid-in capital. The deemed dividend was included in the loss per share calculation; refer to Note 7 , Loss per Common Share , Equity Awards and Warrants |
Inventories, net
Inventories, net | 3 Months Ended |
Aug. 31, 2022 | |
Inventories, net | |
Inventories, net | Note 3. Inventories, net Inventories were as follows (in thousands): August 31, 2022 May 31, 2022 Raw materials $ 16,264 $ 16,264 Work-in-progress 1,665 1,665 Total inventories, net $ 17,929 $ 17,929 The table below summarizes inventory that had been capitalized and subsequently charged off for accounting purposes. Work-in-progress and finished drug product inventories continue to be physically maintained, can be used for clinical trials, and can be commercially sold if the shelf-lives can be extended as a result of the performance of on-going stability tests. Raw Materials Work-in-progress (in thousands, Expiration period ending August 31,) Remaining shelf-life (mos) Specialized Resins Other Total Raw Materials Bulk drug product Finished drug product Total inventories 2023 0 to 12 $ 3,658 $ - $ 1,421 $ 5,079 $ 1,824 $ - $ 6,903 2024 13 to 24 682 16,264 1,590 18,536 1,665 - 20,201 2025 25 to 36 2,099 - - 2,099 - 29,142 31,241 2026 37 to 48 3,435 - - 3,435 - 32,344 35,779 Thereafter 49 or more - - - - - - - Inventories, gross 9,874 16,264 3,011 29,149 3,489 61,486 94,124 Inventory charge (9,874) - (3,011) (12,885) (1,824) (61,486) (76,195) Inventories, net $ - $ 16,264 $ - $ 16,264 $ 1,665 $ - $ 17,929 The Company determines whether raw materials purchased for commercial production are usable for production based on the manufacturer’s assigned expiration date. In evaluating whether raw materials included in the pre-launch inventories will be usable for production, the Company takes into the account the shelf-life of raw materials at the time they are expected to be used in manufacturing. Any raw materials past expiration date at the time of the next manufacturing run are removed from inventory. Also, as one of the stages of the manufacturing process, the Company produces work-in-progress materials which consist of bulk drug substance, which is the manufactured drug stored in bulk storage. The initial shelf-life of bulk drug substance is established based on prior experience and periodically performed stability studies and is set at four years from the date of manufacturing. Bulk drug substance is subject to deep freeze storage, and stability studies performed on a periodic basis in accordance with the established stability protocols. If drug substance meets suitability criteria beyond the initial shelf-life, its shelf-life may be extended based on prior experience and stability trend analysis, and during the extension period periodic stability testing is performed on the drug substance. Regardless of the number of stability studies performed, if drug substance continues to meet prespecified suitability parameters it may be used in manufacturing; if drug substance fails to meet suitability criteria beyond its assigned shelf-life at that time, it may no longer be used and is considered to be expired. Further, the Company utilizes resins, a reusable raw material, in its bulk drug manufacturing process. Shelf-life of a resin used in commercial manufacturing of biologics is determined by the number of cycles for which it has been validated to be used in a manufacturing process before it is considered unusable. Unpacked and unused resins have a manufacturer’s expiration date by which resins are expected to start being used in the manufacturing process without loss of their properties. Prior to a new manufacturing campaign, and between manufacturing campaigns, the resins are removed from storage, treated and tested for suitability. Once resins are used in the manufacturing process, their shelf-life is measured by a validated predetermined number of manufacturing cycles they are usable for, conditional on appropriate storage solution under controlled environment between production campaigns, as well as by performing pre-production usability testing. Before a manufacturing campaign, each resin is tested for suitability. Regardless of the number of cycles, if a resin fails to meet prespecified suitability parameters it may not be used in manufacturing; likewise, even if the resin meets suitability criteria beyond the lifetime cycles, it may no longer be used. The cost of the resins used in a manufacturing campaign is allocated to the cost of the drug product in vials. During the fourth quarter of fiscal 2022, the Company concluded that a significant portion of inventories no longer qualify for capitalization as pre-launch inventories due to expiration of shelf-life prior to expected commercial sales and the ability to obtain additional commercial product stability data until after shelf-life expiration. This is due to delays experienced from the originally anticipated BLA approval by the FDA. Although these inventories are no longer being capitalized as pre-launch inventories for US GAAP accounting purposes, the inventories written-off for accounting purposes continue to be physically maintained, can be used for clinical trials, and can be commercially sold if the shelf-lives are extended as the result of the performance of on-going stability testing of drug product. In the event the shelf-lives of these written-off inventories are extended, and the inventories are sold commercially, the Company will not recognize any costs of goods sold on the previously expensed inventories. The Company also concluded that, due to delays of future production, certain raw materials would expire prior to production and as such no longer qualify for capitalization. Specifically, the Company evaluated its raw materials, which consist of specialized raw materials, resins, and other, against the anticipated production date and determined that while the next production date was indeterminable as of May 31, 2022, specialized raw materials have remaining shelf-lives ranging from 2023 to 2026. Therefore, a reserve of $10.2 million for the entire remaining value of specialized and other raw materials was recorded as of May 31, 2022. The Company also concluded that approximately $29.1 million, composed of five batches of drug product, out of a total of nine manufactured, is likely to expire prior to the anticipated date the product may be approved for commercialization. Additionally, the Company anticipates that approximately $34.2 million of the drug product comprising the remaining four manufactured batches, with shelf-lives lasting into 2026, may expire prior to receiving approval for commercialization. The Company wrote-off the entire remaining balance of the drug product, in the amount of $63.3 million, as of May 31, 2022. During the first quarter of fiscal 2023, the Company reviewed purchase commitments made by its manufacturing partner, Samsung BioLogics Co., Ltd. (“Samsung”), under the master agreement between the Company and Samsung, and its vendors for specialized raw materials for which the Company made a prepayment in the amount of $2.7 million in the third quarter of fiscal 2022, which were recorded as other assets in the consolidated financial statements as of May 31, 2022. The Company and its manufacturing partner have been in discussions, among other things, about cancelling the commitments to the suppliers, which have been unsuccessful to date. These additional specialized raw materials are estimated to have shelf-lives ranging from 2023 to 2026. The entire amount was reserved for as of August 31, 2022. During the fourth quarter of fiscal 2022, the Company completed its validation of the resins’ properties based on the number of cycles they have been used for, and the remaining number of manufacturing cycles they may be used for; the Company did not identify any resins that failed suitability validation. As of August 31, 2022, the remaining life of resins remained unchanged, ranging between 37 and 62 cycles. The Company will continue to present its resins inventory based on the remaining shelf-lives until a new shelf-life is assigned based on the results of usability testing. |
Accounts Payable and Accrued Li
Accounts Payable and Accrued Liabilities | 3 Months Ended |
Aug. 31, 2022 | |
Accounts Payable and Accrued Liabilities | |
Accounts Payable and Accrued Liabilities | Note 4. Accounts Payable and Accrued Liabilities As of August 31, 2022 and May 31, 2022, the accounts payable balance was approximately $69.0 million and $68.0 million, respectively, with two vendors accounting for 69% and 73% of the total balance of accounts payable at the respective dates. The components of accrued liabilities are as follows (in thousands): August 31, 2022 May 31, 2022 Compensation and related expense $ 792 $ 1,522 Legal fees and settlement 1,017 2,006 Clinical expense 311 3,727 Unbilled inventory 2,218 1,392 License fees 541 150 Lease payable 135 134 Other liabilities - 64 Total accrued liabilities $ 5,014 $ 8,995 |
Convertible Instruments and Acc
Convertible Instruments and Accrued Interest | 3 Months Ended |
Aug. 31, 2022 | |
Convertible Instruments and Accrued Interest | |
Convertible Instruments and Accrued Interest | Note 5. Convertible Instruments and Accrued Interest Convertible Preferred Stock The following table presents the number of potentially issuable shares of common stock should shares of preferred stock and amounts of undeclared and accrued preferred dividends be converted to common stock. August 31, 2022 May 31, 2022 (in thousands) Series B Series C Series D Series B Series C Series D Shares of preferred stock 19 6 9 19 7 9 Total shares of common stock if converted 190 12,670 10,565 190 13,806 10,565 Undeclared dividends $ 11 $ - $ - $ 10 $ - $ - Accrued dividends $ - $ 2,186 $ 2,175 $ - $ 2,014 $ 1,963 Total shares of common stock if dividends converted 22 4,372 4,350 20 4,028 3,926 Under the Company’s Amended and Restated Certificate of Incorporation, as amended (the “Certificate of Incorporation”), dividends on its outstanding shares of Series B Convertible Preferred Stock (the “Series B preferred stock”) may be paid in cash or shares of the Company’s common stock at the option of the Company. Dividends on outstanding shares of Series C Convertible Preferred Stock (the “Series C preferred stock”) and Series D Convertible Preferred Stock (the “Series D preferred stock”) are payable in cash or shares of common stock at the election of the holder. The preferred stockholders have the right to dividends only when and if declared by the Company’s Board of Directors. Under Section 170 of the Delaware General Corporation Law, the Company is permitted to pay dividends only out of capital surplus or, if none, out of net profits for the fiscal year in which the dividend is declared or net profits from the preceding fiscal year. Series B Convertible Preferred Stock Each share of the Series B preferred stock is convertible into ten shares of the Company’s common stock. Dividends are cumulative and payable to the Series B preferred stockholders when and as declared by the Company’s Board of Directors (the “Board”). Dividends on the Series B preferred stock accumulate at the rate of $0.25 per share per annum, and may be paid, at the option of the Company at the time of conversion, either in cash or shares of the Company’s common stock valued at $0.50 per share. The Series B preferred stock has liquidation preferences over the common shares at $5.00 per share, plus any accrued and unpaid dividends. Except as provided by law, the Series B preferred stockholders have no voting rights. The Company does not accrue dividends on Series B preferred stock until such dividends are declared. Series C and Series D Convertible Preferred Stock The Series C and Series D Certificates of Designation provide, among other things, that holders of Series C and Series D preferred stock shall be entitled to receive, when and as declared by the Board and out of any assets at the time legally available therefor, cumulative dividends at the rate of ten percent (10%) per share per annum of the stated value of the Series C and Series D preferred stock, which is $1,000 per share (the “Stated Value”). Dividends on the Series C and Series D preferred stock are cumulative, and will accrue and be compounded annually, whether or not declared and whether or not there are any profits, surplus or other funds or assets of the Company legally available therefor. Dividends on the Series C and Series D preferred stock may be paid in cash or shares of the Company’s common stock at the option of the holder. Series C and Series D preferred stock does not have redemption rights. Each share of Series C and Series D preferred stock is convertible at the holder’s option into shares of common stock, with Series C stockholders having conversion price of $0.50 per share, and Series D stockholders having conversion price of $0.80 per share, together with accrued and unpaid dividends payable, at the option of the holder, in cash or shares of common stock based on the conversion price. Given the obligation to settle all dividends, including those in arrears, in cash at the election of the preferred stockholder upon conversion, whether or not declared by the Company, the Company accrues dividends on Series C and D preferred stock as a liability in its consolidated financial statements. In the event of liquidation, dissolution or winding up of the Company, the holders of Series D preferred stock will be entitled to receive, on a pari passu basis with the holders of the Series C preferred stock and in preference to any payment or distribution to holders of the Series B preferred stock and common stock, an amount per share equal to the Stated Value plus the amount of any accrued and unpaid dividends. If, at any time while the Series C and Series D preferred stock is outstanding, the Company effects any reorganization, merger or consolidation of the Company, sale of substantially all of its assets, or other specified transaction (each, as defined in the Series C and the Series D Certificates of Designation, a “Fundamental Transaction”), a holder of Series C and Series D preferred stock will have the right to receive any shares of the acquiring corporation or other consideration it would have been entitled to receive if it had been a holder of the number of shares of common stock then issuable upon conversion in full of the Series C and Series D preferred stock immediately prior to the Fundamental Transaction. Except as otherwise provided in the Series C and Series D Certificates of Designation or as otherwise required by law, the Series C and Series D preferred stock have no voting rights. Convertible Notes and Accrued Interest For additional information about the Company’s debt policies, refer to Note 2, Summary of Significant Accounting Policies, August 31, 2022 May 31, 2022 (in thousands) April 2, 2021 Note April 23, 2021 Note Total April 2, 2021 Note April 23, 2021 Note Total Convertible notes payable outstanding principal $ 9,819 $ 28,500 $ 38,319 $ 9,819 $ 28,500 $ 38,319 Less: Unamortized debt discount and issuance costs (359) (1,127) (1,486) (512) (1,566) (2,078) Convertible notes payable, net 9,460 27,373 36,833 9,307 26,934 36,241 Accrued interest on convertible notes 2,920 4,200 7,120 2,599 3,375 5,974 Outstanding convertible notes payable, net and accrued interest $ 12,380 $ 31,573 $ 43,953 $ 11,906 $ 30,309 $ 42,215 Changes to the outstanding balance of convertible notes, including accrued interest, were as follows: (in thousands) April 2, 2021 Note April 23, 2021 Note Total Outstanding balance at May 31, 2022 $ 11,906 $ 30,309 $ 42,215 Amortization of issuance discount and costs 153 439 592 Interest expense 321 825 1,146 Outstanding balance at August 31, 2022 $ 12,380 $ 31,573 $ 43,953 Long-term Convertible Note – April 2, 2021 Note On April 2, 2021, the Company entered into a securities purchase agreement pursuant to which the Company issued a secured convertible promissory note with a two-year term in the initial principal amount of $28.5 million (the “April 2, 2021 Note”). The Company received consideration of $25.0 million, reflecting an original issue discount of $3.4 million and issuance costs of $0.1 million. Interest accrues at an annual rate of 10% on the outstanding balance, with the rate increasing to the lesser of 22% per annum or the maximum rate permitted by applicable law upon occurrence of an event of default. In addition, upon any event of default, the investor may accelerate the outstanding balance payable under the April 2, 2021 Note; upon such acceleration, the outstanding balance will increase automatically by 15%, 10% or 5%, depending on the nature of the event of default. The events of default are listed in Section 4 of the April 2, 2021 Note filed as Exhibit 4.1 Pursuant to the terms of the April 2, 2021 Note, the Company must obtain the investor’s consent before assuming additional debt with aggregate net proceeds to the Company of less than $50.0 million. In the event of any such approval, the outstanding principal balance of the April 2, 2021 Note will increase automatically by 5% upon the issuance of such additional debt The investor may convert all or any part the outstanding balance of the April 2, 2021 note into shares of common stock at an initial conversion price of $10.00 per share upon five trading days’ notice, subject to certain adjustments and volume and ownership limitations. In addition to standard anti-dilution adjustments, the conversion price of the April 2, 2021 Note is subject to full-ratchet anti-dilution protection, pursuant to which the conversion price will be automatically reduced to equal the effective price per share in any new offering by the Company of equity securities that have registration rights, are registered or become registered under the Securities Act of 1933, as amended (the “Securities Act”). The April 2, 2021 Note provides for liquidated damages upon failure to deliver common stock within specified timeframes and requires the Company to maintain a share reservation of 6.0 million shares of common stock. The investor may redeem any portion of the note, at any time beginning six months after the issue date upon three trading days’ notice, subject to a maximum monthly redemption amount of $3.5 million. The April 2, 2021 Note requires the Company to satisfy its redemption obligations in cash within three trading days of the Company’s receipt of such notice. The Company may prepay the outstanding balance of the note, in part or in full, plus a 15% premium, at any time upon 15 trading days’ notice. Pursuant to the terms of the April 2, 2021 Note, the Company is obligated, at the discretion of the noteholder, to reduce the outstanding balance by $7.5 million per month for five months. During fiscal 2022, in partial satisfaction of debt reduction amounts, the Company and the April 2, 2021 Note holder entered into exchange agreements, pursuant to which the April 2, 2021 Note was partitioned into new notes (the “Partitioned Notes”) with an aggregate principal amount of $18.7 million, which were exchanged concurrently with the issuance of approximately 25.3 million shares of common stock. The outstanding balance of the April 2, 2021 Note was reduced by the Partitioned Notes to a principal amount of $9.8 million. The Company accounted for the restructured partitioned notes and exchange settlements as induced conversion, and, accordingly, recorded an aggregate loss on convertible debt induced conversion of $18.8 million through May 31, 2022; none for the three months ended August 31, 2022 and 2021. Long-term Convertible Note – April 23, 2021 Note On April 23, 2021, the Company entered into a securities purchase agreement pursuant to which the Company issued a secured convertible promissory note with a two-year term to an institutional accredited investor affiliated with the holder of the April 2, 2021 Note in the initial principal amount of $28.5 million (the “April 23, 2021 Note”). The Company received consideration of $25.0 million, reflecting an original issue discount of $3.4 million and issuance costs of $0.1 million. Interest accrues at an annual rate of 10% on the outstanding balance of the April 23, 2021 Note, with the rate increasing to the lesser of 22% per annum or the maximum rate permitted by applicable law upon the occurrence of an event of default. In addition, upon any event of default, the investor may accelerate the outstanding balance payable under the April 23, 2021 Note; upon such acceleration, the outstanding balance will increase automatically by 15%, 10% or 5%, depending on the nature of the event of default. The events of default are listed in Section 4 of the April 23, 2021 Note filed as Exhibit 4.1 Pursuant to the terms of the April 23, 2021 Note, the Company must obtain the investor’s consent before assuming additional debt with aggregate net proceeds to the Company of less than $75.0 million. In the event of any such approval, the outstanding principal balance of the April 23, 2021 Note will increase automatically by 5% upon the issuance of such additional debt. The investor may convert all or any part of the outstanding balance into shares of common stock at an initial conversion price of $10.00 per share upon five three three The holders of the April 2 and April 23 Notes waived provisions in the notes that could have triggered the imposition of a default interest rate, a downward adjustment of the conversion price, or specified other provisions relating to default, breach or imposition of a penalty. The related events included the grant of registration rights to investors in specified private offerings, the issuance of warrants to purchase 30 million shares of common stock with registration rights to certain parties and potential incurrence of debt pursuant to a Surety Bond Backstop Agreement (the “Backstop Agreement”), and the grant of a security interest in the Company’s intellectual property to certain parties to the Backstop Agreement. Refer to Note 6, Equity Awards and Warrants |
Equity Awards
Equity Awards | 3 Months Ended |
Aug. 31, 2022 | |
Equity Awards | |
Equity Awards | Note 6. Equity Awards Approval of Increase in Authorized Common Stock On August 31, 2022, the stockholders’ of the Company, at a special stockholders’ meeting approved a proposal to increase the total number of authorized shares of common stock from 1.0 billion shares to 1.35 billion shares. From June 24, 2022 through August 31, 2022, the Company had insufficient authorized common stock to reserve for the shares underlying the Surety Backstop warrants and warrants issued to a placement agent in connection with the June 2022 offering (Refer to Private Placement of Warrants under Surety Bond Backstop Agreement Private Placement of Common Stock and Warrants through Placement Agent Derivatives and Hedging. In accordance with the prescribed accounting guidance, the Company measured fair value of liability classified warrants using fair value hierarchy which include: Level 1. Level 2. Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices in markets with insufficient volume or infrequent transactions (less active markets), or model-derived valuations in which all significant inputs are observable or can be derived principally from or corroborated with observable market data for substantially the full term of the assets or liabilities. Level 2 inputs also include non-binding market consensus prices that can be corroborated with observable market data, as well as quoted prices that were adjusted for security-specific restrictions. Level 3. Unobservable inputs to the valuation methodology are significant to the measurement of the fair value of assets or liabilities. These Level 3 inputs also include non-binding market consensus prices or non-binding broker quotes that the Company was unable to corroborate with observable market data. As of August 31, 2022, in accordance with ASC 815, Derivatives and Hedging, (in thousands) Liability Classified Warrants Balance at May 31, 2022 $ — Classified as liability due to lack of shares availability at issuance 14,522 Classified as equity upon increase in availability (23,123) Loss on derivative due to change in fair market value 8,601 Balance at August 31, 2022 $ — The Company used a Black Scholes valuation model to estimate the value of the liability classified warrants using assumptions presented in the table below. The Black Scholes valuation model was used because management believes it reflects all the assumptions that market participants would likely consider in negotiating the transfer of the warrant. The Company’s derivative liability is classified within Level 3. Initial Fair Market Value At Issuance Fair Market Value at August 31, 2022 Backstop Backstop Placement Backstop Backstop Placement Warrant #1 Warrant #2 Agent Warrants Warrant #1 Warrant #2 Agent Warrants Fair value of underlying stock $ 0.44 $ 0.42 $ 0.44 $ 0.52 $ 0.52 $ 0.52 Risk free rate 3.17% 3.06% 3.13% 3.34% 3.31% 3.16% Expected term (in years) 4.65 5.00 10.00 4.46 4.88 9.82 Stock price volatility 110.20% 109.49% 95.99% 117.29% 113.59% 95.87% Expected dividend yield 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% Equity Incentive Plan As of August 31, 2022, the Company had one active stock-based equity plan, the CytoDyn Inc. Amended and Restated 2012 Equity Incentive Plan Stock Options, Equity Awards, Warrants, and Stock-Based Compensation Stock option and warrants activity is presented in the table below: Weighted average Weighted remaining Aggregate Number of average contractual intrinsic (in thousands, except per share data) shares exercise price life in years value Options and warrants outstanding at May 31, 2022 90,705 $ 0.77 4.06 $ 352 Granted 104,104 $ 0.25 Exercised (863) $ 0.49 Forfeited, expired, and cancelled (484) $ 1.57 Options and warrants outstanding at August 31, 2022 193,462 $ 0.48 4.36 $ 36,758 Options and warrants outstanding and exercisable at August 31, 2022 187,896 $ 0.45 4.24 $ 36,717 As of August 31, 2022, approximately 11.9 million outstanding stock options were vested, approximately 5.3 million outstanding stock options were unvested, and all outstanding warrants were exercisable. In the three months ended August 31, 2022 and 2021, stock-based compensation expense, inclusive of stock issued for compensation, presented in general and administrative expense in the Company’s consolidated statements of operations, totaled approximately $1.3 million and $2.6 million, respectively. For the three months ended August 31, 2022, approximately $5.3 million of stock-based compensation expense related to warrants issued under the Backstop Agreement, as amended, was recorded as a finance charge in the accompanying consolidated statement of operations; none in the three-month period ended August 31, 2021. Refer to Private Placement of Warrants under Surety Bond Backstop Agreement During the three months ended August 31, 2022, the Company granted stock options covering a total of approximately 0.2 million shares of common stock to employees with exercise prices ranging from $0.41 to $0.67 per share. The stock options vest over four years, have a ten-year term, and a grant date fair value between $0.33 and $0.54 per share. During the same period in the prior year, the Company also issued approximately 0.2 million shares of common stock in connection with the time-based vesting of restricted stock units (“RSUs”) for which it recognized $0.1 million in stock-based compensation expense; there were no issuances of shares of common stock in connection with the exercise of stock options or in connection with the vesting of performance stock units (“PSUs”) in the three months ended August 31, 2022. Issuance of Shares to Former and Current Executives During the fiscal year ended May 31, 2022, the employment of our CEO and General Counsel was terminated. Under the terms of their respective employment agreements, the Company was obligated to pay severance equal to 18 months of salary to our former CEO and 12 months of salary to our former General Counsel. As permitted by the employment agreements, in March 2022, the Board authorized the severance payments to our former CEO and the remaining severance payments to our former General Counsel to be made through the issuance of shares of common stock. During the three months ended August 31, 2022, the Company issued to our former General Counsel a total of 79,391 shares of common stock to satisfy in full its obligation under the terms of the employment agreement. During the same period, consistent with the terms of our former CEO’s employment agreement, the Company also issued 88,983 shares of common stock in satisfaction of the severance amounts due for the months of June, July, and August 2022. The numbers of shares issued were based on the closing price of the common stock on the applicable date. In order to preserve cash resources, in April 2022, the Board of Directors approved the issuance to then executive officers of shares of common stock with a value equal to 25 percent of salary in lieu of cash, net of payroll deductions and withholding taxes. During the three months ended August 31, 2022, a total of 235,676 shares of common stock were issued pursuant to this cash preservation program. The number of shares issued was based on the closing price of the common stock on each payroll date. Private Placement of Warrants under Surety Bond Backstop Agreement On February 14, 2022, the Company entered into the Backstop Agreement with an accredited investor in his individual capacity and as trustee of a revocable trust, as well as certain other related parties (collectively, the “Indemnitors”). Pursuant to the Backstop Agreement, the Indemnitors agreed to assist the Company in obtaining a surety bond (the “Surety Bond”) for posting in connection with the Company’s ongoing litigation with Amarex Clinical Research, LLC ("Amarex”) by, among other things, agreeing to indemnify the issuer of the Surety Bond (the “Surety”) with respect to the Company’s obligations under the Surety Bond through August 13, 2022. As consideration for the Indemnitors’ agreement to indemnify the Surety, the Company agreed (i) to issue to 4-Good Ventures LLC, an affiliate of the Indemnitors (“4-Good”), a warrant for the purchase of 15,000,000 shares of common stock as a backstop fee (the “Initial Warrant”), (ii) to issue to 4-Good a warrant for the purchase of an additional 15,000,000 shares, to be exercisable only if the Indemnitors were required to make any payment to the Surety (the “Make-Whole Warrant” and, together with the Initial Warrant, the “4-Good Warrants”), and (iii) if the Indemnitors are required to make a payment to the Surety, (A) within 90 days of such payment, to reimburse the Indemnitors for any amount paid to the Surety and (B) to pay to the Indemnitors an indemnification fee in an amount equal to 1.5 times the amount paid by the Indemnitors to the Surety. The payment obligations of the Company to the Indemnitors will bear interest at 10% per annum and are secured by substantially all of the patents held by the Company. The Company recognized a finance charge of approximately $6.6 million related to the warrant issuance for the year ended May 31, 2022. Pursuant to an amendment to the Backstop Agreement executed on July 18, 2022 (the “Backstop Amendment”), among other matters: (i) the obligation of the Indemnitors to indemnify the Surety was extended from August 13, 2022 to November 15, 2022; (ii) each of the 4-Good Warrants has a five-year term from the date of issuance and an exercise price of $0.20 per share (reduced from $0.30 per share); (iii) the Make-Whole Warrant was amended to be fully exercisable immediately; (iv) the Indemnitors and 4-Good agreed to waive the requirement to reserve for issuance the shares subject to the Make-Whole Warrant pending stockholder approval of an increase in the authorized shares of common stock; and (v) upon the exercise in full of the 4-Good Warrants, the Company agreed to take reasonable steps to cause the Indemnitors to be released from their indemnity obligations by an amount equal to the exercise proceeds. Private Placement of Common Stock and Warrants through Placement Agent In April 2022, the Company initiated a private placement of common stock and warrants, completed in June 2022, to accredited investors through a placement agent. Between April and June 2022, the Company sold a total of approximately 85.4 million shares of common stock for a total of approximately $18.9 million of proceeds, net of issuance costs. Of these, approximately $7.7 million of proceeds, net of issuance costs, relating to approximately 34.6 million shares were remitted to the Company by May 31, 2022. Each unit sold included a fixed combination of one share of common stock and three-quarters of one warrant to purchase one share of common stock for a purchase price of $0.255 per unit. The Company issued approximately 64.0 million warrants to investors with each such warrant having a five-year term and an exercise price of 120% of the final unit price, or $0.306 per share, and are immediately exercisable. The Company paid the placement agent a total cash fee of approximately $2.8 million, equal to 13% of the gross proceeds of the offering, as well as a one-time fee for expenses of $50,000, and issued a total of approximately 19.4 million warrants with an exercise price of $0.255 per share and a ten-year term, representing 13% of the total number of shares, including shares subject to warrants sold in the offering, to the placement agent and its designees. The issuance of the warrants to the placement agent was subject to the approval by the Company’s stockholders of an increase in authorized shares of common stock, which was approved on August 31, 2022. Down Round Provision Issuance and Modification to Previous Private Offerings During the three months ended August 31, 2022, common stock and warrants previously issued between February and April 2022 to accredited investors directly by the Company in a private placement became subject to a down round provision under the original purchase agreements requiring the Company to reduce the purchase price of common stock from the original price of $0.40 to $0.255 per share, to increase the percentage of the warrant coverage from 50% to 75% based on the revised amount of total shares issued, and to reduce the exercise price of the warrants from the original price of $0.40 to $0.255, the terms in the latest round of financing conducted by the Company through the placement agent as discussed above. As a result, an approximate additional 4.6 million shares of common stock and 5.5 million warrants were issued. The incremental fair value of the warrants were measured using the Black-Scholes pricing model, resulting in an approximately $4.2 million charge to additional paid-in capital which was accounted for as a deemed dividend. Warrant Exercises During the three months ended August 31, 2022, the Company issued approximately 0.5 million shares of common stock in connection with the exercise of an equal number of warrants. The stated exercise prices ranged from $0.45 to $0.75 per share, which resulted in aggregate gross proceeds of approximately $0.3 million. Additionally, during the three months ended August 31, 2022, the Company issued approximately 0.2 million shares of common stock in connection with the cashless exercise of approximately 0.3 million warrants with stated exercise prices ranging from $0.40 to $0.50 per share. |
Loss Per Common Share
Loss Per Common Share | 3 Months Ended |
Aug. 31, 2022 | |
Loss Per Common Share | |
Loss Per Common Share | Note 7. Loss per Common Share Basic loss per share is computed by dividing the net loss adjusted for preferred stock dividends by the weighted average number of common shares outstanding during the period. Diluted loss per share includes the weighted average common shares outstanding and potentially dilutive common stock equivalents. Because of the net losses for all periods presented, the basic and diluted weighted average shares outstanding are the same since including the additional shares would have an anti-dilutive effect on loss per share. The reconciliation of the numerators and denominators of the basic and diluted net loss per share computations are as follows: Three months ended August 31, (in thousands, except per share amounts) 2022 2021 (Restated) (1) Net loss $ (20,991) $ (45,337) Less: Deemed dividends due to down round provision (4,154) — Less: Accrued preferred stock dividends (385) (425) Net loss applicable to common stockholders $ (25,530) $ (45,762) Basic and diluted: Weighted average common shares outstanding 787,856 632,597 Loss per share $ (0.03) $ (0.07) (1) See Note 2, Summary of Significant Accounting Policies The table below shows the approximate number of shares of common stock issuable upon the exercise, vesting or conversion of outstanding options, warrants, unvested restricted stock units (including those subject to performance conditions), convertible notes, and convertible preferred stock (including undeclared dividends) that were not included in the computation of basic and diluted weighted average number of shares of common stock outstanding for the periods presented: Three months ended August 31, (in thousands) 2022 2021 Stock options, warrants, and unvested restricted stock units 193,609 60,141 Convertible notes 12,000 12,000 Convertible preferred stock 32,170 33,858 |
Income Taxes
Income Taxes | 3 Months Ended |
Aug. 31, 2022 | |
Income Taxes | |
Income Taxes | Note 8. Income Taxes The Company calculates its quarterly taxes under the effective tax rate method based on applying an anticipated annual effective rate to its year-to-date income, except for discrete items. Income taxes for discrete items are computed and recorded in the period that the specific transaction occurs. The Company’s net tax expense for the three months ended August 31, 2022 and 2021 was zero. The Company does not consider it more likely than not that the benefits from the net deferred taxes will be realized; therefore the Company maintains a full valuation allowance as of August 31, 2022 and May 31, 2022 thus creating a difference between the effective tax rate of 0% and the statutory rate of 21%. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Aug. 31, 2022 | |
Commitments and Contingencies. | |
Commitments and Contingencies | Note 9. Commitments and Contingencies Commitments with Samsung BioLogics Co., Ltd. (“Samsung”) In April 2019, the Company entered into an agreement with Samsung, pursuant to which Samsung will perform technology transfer, process validation, manufacturing, pre-approval inspection and supply services for the commercial supply of leronlimab bulk drug substance effective through calendar year 2027. In 2020, the Company entered into an additional agreement, pursuant to which Samsung will perform technology transfer, process validation, vial filling and storage services for clinical, pre-approval inspection, and commercial supply of leronlimab drug product. Samsung is obligated to procure necessary raw materials for the Company and manufacture a specified minimum number of batches, and the Company is required to provide a rolling three-year forecast of future estimated manufacturing requirements to Samsung that are binding. On January 6, 2022, Samsung provided written notice to the Company alleging that the Company had materially breached the parties’ Master Services and Project Specific Agreements for failure to pay $13.5 million due on December 31, 2021. An additional $22.8 million became due under the agreements on January 31, 2022. Under the agreements, Samsung may be entitled to terminate its services if the parties cannot reach an agreement as to the past due balance. Management is in ongoing discussions with Samsung regarding potential approaches to resolve these issues, including proposals by both parties of a revised schedule of payments over an extended period of time, and proposals by the Company of satisfaction of a portion of the Company’s payment obligations in equity securities of the Company and postponing or cancelling the manufacturing of additional drug provided for in the agreements. As of August 31, 2022, the Company had past due balances of approximately $35.7 million due to Samsung which were included in accounts payable. As of August 31, 2022, the future commitments pursuant to these agreements were estimated as follows (in thousands): Fiscal Year Amount 2023 (9 months remaining) $ 34,638 2024 121,750 2025 76,400 2026 and thereafter — Total $ 232,788 Operating Lease Commitments We lease our principal office location in Vancouver, Washington. The Vancouver lease expires on April 30, 2026. Consistent with the guidance in ASC 842, , we have recorded this lease in our consolidated balance sheet as an operating lease. For the purpose of determining the right of use asset and associated lease liability, we determined that the renewal of the Vancouver lease was not reasonably probable. The lease does not include any restrictions or covenants requiring special treatment under ASC 842, . During the three months ended August 31, 2022 and 2021, we recognized approximately $46.0 thousand and $48.9 thousand of operating lease costs. Operating lease right-of-use assets are included in other non-current assets and the current portion of operating lease liabilities are included in accrued liabilities and compensation on the consolidated balance sheets. The long-term operating lease liabilities are presented separately as operating lease on the consolidated balance sheets. The following table summarizes the operating lease balances. (in thousands) August 31, 2022 May 31, 2022 Assets Right-of-use asset $ 502 $ 536 Liabilities Current operating lease liability $ 135 $ 134 Non-current operating lease liability 387 422 Total operating lease liability $ 522 $ 556 The minimum (base rental) lease payments are expected to be as follows as of August 31, 2022 (in thousands): Fiscal Year Amount 2023 (9 months remaining) $ 133 2024 182 2025 185 2026 169 Total operating lease payments 669 Less: imputed interest (147) Present value of operating lease liabilities $ 522 Supplemental information related to operating leases was as follows: August 31, 2022 Weighted average remaining lease term 3.6 years Weighted average discount rate 10.0 % Distribution and Licensing Commitments Refer to Note 10, Commitments and Contingencies Legal Proceedings As of August 31, 2022, the Company did not record any legal accruals related to the outcomes of the matters described below. It may not be possible to determine the outcome of these proceedings, including the defense and other litigation-related costs and expenses that may be incurred by the Company, as the outcomes of legal proceedings are inherently uncertain. Therefore, it is possible that the ultimate outcome of any proceeding, if in excess of a recognized accrual, if any, could be material to the Company’s consolidated financial statements. Securities Class Action Lawsuit On March 17, 2021, a stockholder filed a putative class-action lawsuit (the “March 17, 2021 lawsuit”) in the U.S. District Court for the Western District of Washington against the Company and certain current and former officers. The complaint generally alleges the defendants made false and misleading statements regarding the viability of leronlimab as a potential treatment for COVID-19. On April 9, 2021, a second stockholder filed a similar putative class action lawsuit in the same court, which the plaintiff voluntarily dismissed without prejudice on July 23, 2021. On August 9, 2021, the court appointed lead plaintiffs for the March 17, 2021 lawsuit. On December 21, 2021, lead plaintiffs filed an amended complaint, which is brought on behalf of an alleged class of those who purchased the Company’s common stock between March 27, 2020 and May 17, 2021. The amended complaint generally alleges that the Company and certain current and former officers violated Sections 10(b) and/or 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder by making purportedly false or misleading statements concerning, among other things, the safety and efficacy of leronlimab as a potential treatment for COVID-19, the Company’s CD10 and CD12 clinical trials, and its HIV BLA. The amended complaint also alleges that the individual defendants violated Section 20A of the Exchange Act by selling shares of the Company’s common stock purportedly while in possession of material nonpublic information. The amended complaint seeks, among other relief, a ruling that the case may proceed as a class action and unspecified damages and attorneys’ fees and costs. On February 25, 2022, the defendants filed a motion to dismiss the amended complaint. On June 24, 2022, lead plaintiffs filed a second amended complaint. The second amended complaint is brought on behalf of an alleged class of those who purchased the Company’s common stock between March 27, 2020 and March 30, 2022, makes similar allegations, names the same defendants, and asserts the same claims as the prior complaint, adds a claim for alleged violation of Section 10(b) of the Exchange Act and Rule 10b-5(a) and (c) promulgated thereunder, and seeks the same relief as the prior complaint. The Company and the individual defendants deny all allegations of wrongdoing in the complaint and intend to vigorously defend the matter. Since this case is in an early stage where the number of plaintiffs is not known, and the claims do not specify an amount of damages, the Company is unable to predict the ultimate outcome of the lawsuit and cannot reasonably estimate the potential loss or range of loss the Company may incur. 2021 Shareholder Derivative Lawsuits On June 4, 2021, a stockholder filed a purported derivative lawsuit against certain of the Company’s current and former officers, certain current and former Board members, and the Company as a nominal defendant, in the U.S. District Court for the Western District of Washington. Two additional shareholder derivative lawsuits were filed against the same defendants in the same court on June 25, 2021 and August 18, 2021, respectively. The court has consolidated these three lawsuits for all purposes (“Consolidated Derivative Suit”). On January 20, 2022, the plaintiffs filed a consolidated complaint. The consolidated complaint generally alleges that the director defendants breached their fiduciary duties by allowing the Company to make false and misleading statements regarding, among other things, the safety and efficacy of leronlimab as a potential treatment for COVID-19, the Company’s CD10 and CD12 clinical trials, and its HIV BLA, and by failing to maintain an adequate system of oversight and controls. The consolidated complaint also asserts claims against one or more individual defendants for waste of corporate assets, unjust enrichment, contribution for alleged violations of the federal securities laws, and for breach of fiduciary duty arising from alleged insider trading. The consolidated complaint seeks declaratory and equitable relief, an unspecified amount of damages, and attorneys’ fees and costs. The Company and the individual defendants deny all allegations of wrongdoing in the complaints and intend to vigorously defend the litigation. In light of the fact that the Consolidated Derivative Suit is in an early stage and the claims do not specify an amount of damages, the Company cannot predict the ultimate outcome of the Consolidated Derivative Suit and cannot reasonably estimate the potential loss or range of loss the Company may incur. Securities and Exchange Commission and Department of Justice Investigations The Company has received subpoenas from the United States Securities and Exchange Commission (“SEC”) and the United States Department of Justice (“DOJ”) requesting documents and information concerning, among other matters, leronlimab, the Company’s public statements regarding the use of leronlimab as a potential treatment for COVID-19, HIV, and triple-negative breast cancer, related communications with the FDA, investors, and others, litigation involving former employees, the Company’s retention of investor relations consultants, and trading in the Company’s securities. Certain Company executives have received subpoenas concerning similar issues and may be interviewed by the DOJ or SEC in the future. The SEC informed the Company that its inquiry should not be construed as an indication that any violations of law have occurred or that the SEC has any negative opinion of any person, entity or security The Company is cooperating fully with these non-public, fact-finding investigations, and as of the date of this filing, the Company is unable to predict the ultimate outcome and cannot reasonably estimate the potential possible loss or range of loss, if any. Amarex Dispute On October 4, 2021, the Company filed a complaint for declaratory and injunctive relief and a motion for a preliminary injunction against NSF International, Inc. and its subsidiary Amarex Clinical Research LLC (“Amarex”), the Company’s former CRO. Over the past eight years, Amarex provided clinical trial management services to the Company and managed numerous clinical studies of the Company’s drug product candidate, leronlimab. On December 16, 2021, the U.S. District Court for the District of Maryland issued a preliminary injunction requiring Amarex to provide the Company with access to all of its materials in the possession of Amarex. The court also granted CytoDyn the right to conduct an audit of Amarex’s work for CytoDyn. That case has been administratively closed. The Company simultaneously filed a demand for arbitration with the American Arbitration Association. The arbitration demand alleges that Amarex failed to perform services to an acceptable professional standard and failed to perform certain services required by the parties’ agreements. Further, the demand alleges that Amarex billed the Company for services it did not perform. The Company contends that, due to Amarex’s failures, it has suffered avoidable delays in obtaining regulatory approval of leronlimab and has paid for services not performed. Amarex has counterclaimed alleging that CytoDyn has failed to pay invoices due under the contract between the parties. In light of the fact that this dispute is in an early stage, the Company cannot predict the ultimate outcome of the lawsuit and cannot reasonably estimate the potential loss or range of loss that the Company may incur. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Aug. 31, 2022 | |
Subsequent Events | |
Subsequent Events | Note 10. Subsequent Events Issuance of Shares to Former CEO During the fiscal year ended May 31, 2022, the employment of our CEO was terminated. Under the terms of the employment agreement, the Company was obligated to pay severance equal to 18 months In September 2022, the Company appointed to its Scientific Advisory Board (“SAB”): Dr. Jordan Lake to assist with trial design for HIV/NASH and identifying collaborative opportunities, Dr. Stefan Glück to assist with identifying partners, trial design, identifying collaborations, and opportunities in oncology, and Dr. Nueto Ueno to assist with trial design and identifying opportunities for collaboration in oncology. The Company issued 50,000 options for shares of common stock to each SAB member in consideration for their annual service on the SAB. On September 6, 2022, the Board’s Compensation Committee approved, under the Company’s 2012 Plan, grants of fully vested nonqualified stock options to purchase shares of common stock to three of the Company’s nonemployee directors for their service during the fiscal year ended May 31, 2022, as follows: Tanya Durkee Urbach, 112,500 shares; Lishomwa Ndhlovu, 112,500 shares; and Karen J. Brunke, 37,500 shares. The Compensation Committee also approved, under the 2012 Plan, grants of nonqualified stock options to purchase shares of common stock to the Company’s four nonemployee directors as of September 6, 2022, for service during the fiscal year ending May 31, 2023, as follows; each of Ms. Urbach, Dr. Brunke, and Dr. Ndhlovu, 247,111 shares, of which 25% were fully vested on the grant date and the balance will vest in nine equal monthly installments beginning on October 1, 2022, subject to continuous service (as defined in the 2012 Plan) through the applicable vesting date; and Ryan Dunlap, service on the Company’s Scientific Advisory Board beginning in July 2021. All of the stock options have an exercise price of $0.50 per share and a 10-year On September 20, 2022, the Board’s Compensation Committee approved the grant of equity awards under the Company’s 2012 Plan to its President in accordance with the terms of his employment agreement as follows: (i) nonqualified stock options to purchase 1,575,557 shares of common stock at an exercise price of $0.58 per share, with 25% of the options vesting on July 9, 2023, and the balance in 36 equal monthly installments thereafter, subject to continuous service through the applicable vesting date; (ii) RSUs relating to Also on September 20, 2022, the Compensation Committee approved the grant of nonqualified stock options under the 2012 Plan to the Company’s CFO to purchase 630,222 shares of common stock at an exercise price of $0.58 per share, with 25% of the options vesting on January 24, 2023, and the balance in 36 equal monthly installments thereafter, subject to continuous service through the applicable vesting date, as additional compensation for his service as interim President from January 24, 2022, through July 9, 2022. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Aug. 31, 2022 | |
Summary of Significant Accounting Policies | |
Basis of Presentation | Basis of Presentation The unaudited interim consolidated financial statements include the accounts of CytoDyn Inc. and its wholly owned subsidiaries, CytoDyn Operations Inc. and Advanced Genetic Technologies, Inc. (“AGTI”); AGTI is a dormant entity. The consolidated financial statements reflect all normal recurring adjustments which are, in the opinion of management, necessary for a fair statement of the results of operations for the interim financial statements. The interim financial information and notes thereto should be read in conjunction with the Company's latest Annual Report on Form 10-K for the fiscal year ended May 31, 2022 (the “2022 Form 10-K”) The results of operations for the periods presented are not necessarily indicative of results to be expected for the entire fiscal year or for any other future annual or interim period. |
Reclassifications | Reclassifications Certain prior year and prior quarter amounts shown in the accompanying consolidated financial statements have been reclassified to conform to the current period presentation. Such reclassifications did not have material effect on the Company’s previously reported financial position, results of operations, stockholders’ deficit, or net cash provided by operating activities. During the quarter ended August 31, 2022, the Company reclassified amounts recorded as accumulated dividends for Series C and D preferred stockholders from accumulated deficit to additional paid-in capital. These reclassifications were made to reflect the proper presentation for accrued dividends when an entity has accumulated deficit. |
Revision of Financial Statements | Revision and Restatement of Financial Statements During the preparation of the quarterly financial statements as of and for the period ended November 30, 2021, the Company identified an error in how non-cash inducement interest expense was calculated in previous reporting periods dating back to fiscal year 2018. The error resulted in an understatement of non-cash inducement interest expense and additional paid-in capital. For details, refer to Note 2, Summary of Significant Accounting Policies - Revision of Financial Statements Restatement |
Going Concern | Going Concern The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. As presented in the accompanying consolidated financial statements, the Company had losses for all periods presented. The Company incurred a net loss of approximately $21.0 million for the three months ended August 31, 2022, and has an accumulated deficit of approximately $782.9 million as of August 31, 2022. These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern. The consolidated financial statements do not include any adjustments relating to the recoverability of assets and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. The Company’s continuation as a going concern is dependent upon its ability to obtain additional operating capital, complete the development of its product candidate, leronlimab, obtain approval to commercialize leronlimab from regulatory agencies, continue to outsource manufacturing of leronlimab, and ultimately achieve revenues and attain profitability. The Company plans to continue to engage in research and development activities related to leronlimab for multiple indications and expects to incur significant research and development expenses in the future primarily related to its regulatory compliance and approval, and clinical trials. These research and development activities are subject to significant risks and uncertainties. The Company intends to finance its future development activities and its working capital needs primarily from the sale of equity and debt securities, combined with additional funding from other sources. However, there can be no assurance that the Company will be successful in these endeavors. |
Use of Estimates | Use of Estimates The preparation of the consolidated financial statements in accordance with accounting principles generally accepted in the United States (U.S. GAAP) requires management to make estimates and judgments that affect the reported amounts of assets, liabilities, and the disclosure of contingent assets and liabilities at the date of consolidated financial statements, and the reported amounts of revenue and expenses during the reporting period. Estimates are assessed each period and updated to reflect current information, such as the status of our analysis of the results of our clinical trials and/or discussions with the FDA which could have an impact on the Company’s significant accounting estimates and assumptions. The Company’s estimates are based on historical experience and on various market and other relevant, appropriate assumptions. Significant estimates include, but are not limited to, those relating to stock-based compensation, capitalization of pre-launch inventories, write-off for excess and obsolete inventories, research and development expenses, commitments and contingencies, and the assumptions used to value warrants and warrant modifications. Actual results could differ from these estimates. |
Pre-launch Inventories | Pre-launch Inventories Pre-launch inventories are comprised of raw materials required to commercially produce leronlimab and substantially completed commercially produced leronlimab in anticipation of commercial sales of the product upon potential regulatory approval as a combination therapy for HIV patients in the United States. The Company’s pre-launch inventories consist of (1) raw materials purchased for commercial production, (2) work-in-progress materials which consist of bulk drug substance, which is the manufactured drug stored in bulk storage, and (3) drug product, which is the manufactured drug in unlabeled vials. The consumption of raw materials during production is classified as work-in-progress until saleable. Once it is determined to be in saleable condition, following regulatory approval, inventory is classified as finished goods. The Company capitalizes inventories procured or produced in preparation for product launches. Typically, capitalization of such inventory begins when the results of clinical trials have reached a status sufficient to support regulatory approval, uncertainties regarding ultimate regulatory approval have been significantly reduced, and the Company has determined it is probable that these capitalized costs will provide future economic benefit in excess of capitalized costs. The material factors considered by the Company in evaluating these uncertainties include the receipt and analysis of positive Phase 3 clinical trial results for the underlying product candidate, results from meetings with the relevant regulatory authorities prior to the filing of regulatory applications, and status of the Company’s regulatory applications. The Company closely monitors the status of the product within the regulatory review and approval process, including all relevant communications with regulatory authorities. If the Company becomes aware of any specific material risks or contingencies other than the normal regulatory review and approval process or if there are any specific issues identified relating to safety, efficacy, manufacturing, marketing or labeling, it may make a determination that the related inventory no longer qualifies for capitalization. The Company determines whether raw materials purchased for commercial production are usable for production based on the manufacturer’s assigned expiration date. In evaluating whether raw materials included in the pre-launch inventories will be usable for production, the Company takes into account the shelf-life of raw materials at the time they are expected to be used in manufacturing. Any raw materials past expiration date at the time of the next manufacturing run are removed from inventory. As one stage of the manufacturing process, the Company produces work-in-progress materials which consist of bulk drug substance, which is the manufactured drug stored in bulk storage. The initial shelf-life of bulk drug substance is established based on prior experience and periodically performed stability studies and is set at four years from the date of manufacturing. Bulk drug substance is subject to deep freeze storage, and stability studies are performed on a periodic basis in accordance with the established stability protocols. If drug substance meets suitability criteria beyond the initial shelf-life, its shelf-life may be extended based on prior experience and stability trend analysis, and during the extension period periodic stability testing is performed on the drug substance. Regardless of the number of stability studies performed, if drug substance continues to meet prespecified suitability parameters it may be used in manufacturing; if drug substance fails to meet suitability criteria beyond its assigned shelf-life at that time, it may no longer be used and is considered to be expired. The Company utilizes resins, a reusable raw material, in its bulk drug manufacturing process. Shelf-life of a resin used in commercial manufacturing of biologics is determined by the number of cycles for which it has been validated to be used in a manufacturing process before it is considered unusable. Unpacked and unused resins have a manufacturer’s expiration date by which resins are expected to start being used in the manufacturing process without loss of their properties. Prior to a new manufacturing campaign, and between manufacturing campaigns, the resins are removed from storage, and are treated and tested for suitability. Once resins are used in the manufacturing process, their shelf-life is measured by a validated predetermined number of manufacturing cycles they are usable for, conditional on appropriate storage solution under controlled environment between production campaigns, as well as by performing pre-production usability testing. Before a manufacturing campaign, each resin is tested for suitability. Regardless of the number of cycles, if a resin fails to meet prespecified suitability parameters it may not be used in manufacturing; likewise, even if the resin meets suitability criteria beyond the lifetime cycles, it may no longer be used. The cost of the resins used in a manufacturing campaign is allocated to the cost of the drug product in vials. The Company values its inventory at the lower of cost or net realizable value using the average cost method. Inventory is evaluated for recoverability by considering the likelihood that revenue will be obtained from the future sale of the related inventory considering the status of the product within the regulatory approval process. The Company evaluates its inventory levels on a quarterly basis and writes down inventory that became obsolete, has a cost in excess of its expected net realizable value, or is in quantities in excess of expected requirements. In assessing the lower of cost or net realizable value for pre-launch inventory, the Company relies on independent analyses provided by third parties knowledgeable about the range of likely commercial prices comparable to current comparable commercial product. Quarterly, the Company also evaluates whether certain raw materials held in its inventory are expected to reach the end of their estimated shelf-lives based on passage of time, the number of manufacturing cycles they are used in and results of pre-production testing prior to the expected production date, or when resins used in the manufacturing process fail suitability tests. If any of such events occur, the Company may make a determination to record a charge if it is expected that such inventories will become obsolete prior to the expected production date. Anticipated future sales, shelf lives, and expected approval date are considered when evaluating realizability of capitalized inventory. The shelf-life of a product is determined as part of the regulatory approval process; however, in assessing whether to capitalize pre-launch inventories, the Company considers the product stability data for all of the pre-approval inventory procured or produced to date to determine whether there is adequate shelf-life. When the remaining shelf-life of drug product inventory is less than 12 months, it is likely that it will not be accepted by potential customers. However, as inventories approach their shelf-life expiration, the Company may perform additional stability testing to determine if the inventory is still viable, which can result in an extension of its shelf-life and revaluation of the need for and the amount of the previously recorded reserves. Further, in addition to performing additional stability testing, certain raw materials inventory may be sold in its then current condition prior to reaching expiration. If the Company determines that it is not likely that shelf-life may be extended or the inventory cannot be sold prior to expiration, the Company may record a charge to bring inventory to its net realizable value. For additional information about the Company’s significant accounting policies, refer to Note 2, Summary of Significant Accounting Policies, |
Recent Accounting Pronouncements | Recently Adopted Accounting Pronouncements In August 2020, the FASB issued ASU No. 2020-06, Debt with Conversion and Other Options (Subtopic 470-20) Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40) In May 2021, the FASB issued ASU No. 2021-04, Earnings Per Share (Topic 260), Debt—Modifications and Extinguishments (Subtopic 470-50), Compensation - Stock Compensation (Topic 718), and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options The Company adopted the new guidance prospectively as of June 1, 2022 and used the framework to record a modification to the exercise price of equity classified warrants during the three months ended August 31, 2022. The incremental value of modification to equity instruments as a result of a trigger of a down round provision was recorded as a deemed dividend in accordance with this guidance, resulting in an approximate $4.2 million charge to additional paid-in capital. The deemed dividend was included in the loss per share calculation; refer to Note 7 , Loss per Common Share , Equity Awards and Warrants |
Inventories, net (Tables)
Inventories, net (Tables) | 3 Months Ended |
Aug. 31, 2022 | |
Inventories, net | |
Summary of Inventories, net of reserves | Inventories were as follows (in thousands): August 31, 2022 May 31, 2022 Raw materials $ 16,264 $ 16,264 Work-in-progress 1,665 1,665 Total inventories, net $ 17,929 $ 17,929 |
Schedule of remaining shelf life of inventory | Raw Materials Work-in-progress (in thousands, Expiration period ending August 31,) Remaining shelf-life (mos) Specialized Resins Other Total Raw Materials Bulk drug product Finished drug product Total inventories 2023 0 to 12 $ 3,658 $ - $ 1,421 $ 5,079 $ 1,824 $ - $ 6,903 2024 13 to 24 682 16,264 1,590 18,536 1,665 - 20,201 2025 25 to 36 2,099 - - 2,099 - 29,142 31,241 2026 37 to 48 3,435 - - 3,435 - 32,344 35,779 Thereafter 49 or more - - - - - - - Inventories, gross 9,874 16,264 3,011 29,149 3,489 61,486 94,124 Inventory charge (9,874) - (3,011) (12,885) (1,824) (61,486) (76,195) Inventories, net $ - $ 16,264 $ - $ 16,264 $ 1,665 $ - $ 17,929 |
Accounts Payable and Accrued _2
Accounts Payable and Accrued Liabilities (Tables) | 3 Months Ended |
Aug. 31, 2022 | |
Accounts Payable and Accrued Liabilities | |
Schedule of components of accrued liabilities | The components of accrued liabilities are as follows (in thousands): August 31, 2022 May 31, 2022 Compensation and related expense $ 792 $ 1,522 Legal fees and settlement 1,017 2,006 Clinical expense 311 3,727 Unbilled inventory 2,218 1,392 License fees 541 150 Lease payable 135 134 Other liabilities - 64 Total accrued liabilities $ 5,014 $ 8,995 |
Convertible Instruments and A_2
Convertible Instruments and Accrued Interest (Tables) | 3 Months Ended |
Aug. 31, 2022 | |
Convertible Instruments and Accrued Interest | |
Schedule of information on dividends of convertible preferred stock | August 31, 2022 May 31, 2022 (in thousands) Series B Series C Series D Series B Series C Series D Shares of preferred stock 19 6 9 19 7 9 Total shares of common stock if converted 190 12,670 10,565 190 13,806 10,565 Undeclared dividends $ 11 $ - $ - $ 10 $ - $ - Accrued dividends $ - $ 2,186 $ 2,175 $ - $ 2,014 $ 1,963 Total shares of common stock if dividends converted 22 4,372 4,350 20 4,028 3,926 |
Schedule of outstanding balances of convertible notes | For additional information about the Company’s debt policies, refer to Note 2, Summary of Significant Accounting Policies, August 31, 2022 May 31, 2022 (in thousands) April 2, 2021 Note April 23, 2021 Note Total April 2, 2021 Note April 23, 2021 Note Total Convertible notes payable outstanding principal $ 9,819 $ 28,500 $ 38,319 $ 9,819 $ 28,500 $ 38,319 Less: Unamortized debt discount and issuance costs (359) (1,127) (1,486) (512) (1,566) (2,078) Convertible notes payable, net 9,460 27,373 36,833 9,307 26,934 36,241 Accrued interest on convertible notes 2,920 4,200 7,120 2,599 3,375 5,974 Outstanding convertible notes payable, net and accrued interest $ 12,380 $ 31,573 $ 43,953 $ 11,906 $ 30,309 $ 42,215 |
Schedule of changes to outstanding balance of convertible notes | (in thousands) April 2, 2021 Note April 23, 2021 Note Total Outstanding balance at May 31, 2022 $ 11,906 $ 30,309 $ 42,215 Amortization of issuance discount and costs 153 439 592 Interest expense 321 825 1,146 Outstanding balance at August 31, 2022 $ 12,380 $ 31,573 $ 43,953 |
Equity Awards (Tables)
Equity Awards (Tables) | 3 Months Ended |
Aug. 31, 2022 | |
Equity Awards | |
Schedule of Warrant Liability and Equity | (in thousands) Liability Classified Warrants Balance at May 31, 2022 $ — Classified as liability due to lack of shares availability at issuance 14,522 Classified as equity upon increase in availability (23,123) Loss on derivative due to change in fair market value 8,601 Balance at August 31, 2022 $ — |
Stock Option and Warrant Activity | Weighted average Weighted remaining Aggregate Number of average contractual intrinsic (in thousands, except per share data) shares exercise price life in years value Options and warrants outstanding at May 31, 2022 90,705 $ 0.77 4.06 $ 352 Granted 104,104 $ 0.25 Exercised (863) $ 0.49 Forfeited, expired, and cancelled (484) $ 1.57 Options and warrants outstanding at August 31, 2022 193,462 $ 0.48 4.36 $ 36,758 Options and warrants outstanding and exercisable at August 31, 2022 187,896 $ 0.45 4.24 $ 36,717 |
Loss Per Common Shares (Tables)
Loss Per Common Shares (Tables) | 3 Months Ended |
Aug. 31, 2022 | |
Loss Per Common Share | |
Schedule of reconciliation of the numerators and denominators of basic and diluted net loss per share | Three months ended August 31, (in thousands, except per share amounts) 2022 2021 (Restated) (1) Net loss $ (20,991) $ (45,337) Less: Deemed dividends due to down round provision (4,154) — Less: Accrued preferred stock dividends (385) (425) Net loss applicable to common stockholders $ (25,530) $ (45,762) Basic and diluted: Weighted average common shares outstanding 787,856 632,597 Loss per share $ (0.03) $ (0.07) (1) See Note 2, Summary of Significant Accounting Policies |
Schedule of securities excluded from computation of earnings per share | Three months ended August 31, (in thousands) 2022 2021 Stock options, warrants, and unvested restricted stock units 193,609 60,141 Convertible notes 12,000 12,000 Convertible preferred stock 32,170 33,858 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 3 Months Ended |
Aug. 31, 2022 | |
Commitments and Contingencies. | |
Schedule of future commitments | Fiscal Year Amount 2023 (9 months remaining) $ 34,638 2024 121,750 2025 76,400 2026 and thereafter — Total $ 232,788 |
Schedule of operating lease balances | (in thousands) August 31, 2022 May 31, 2022 Assets Right-of-use asset $ 502 $ 536 Liabilities Current operating lease liability $ 135 $ 134 Non-current operating lease liability 387 422 Total operating lease liability $ 522 $ 556 |
Schedule of the minimum (base rental) lease payments | The minimum (base rental) lease payments are expected to be as follows as of August 31, 2022 (in thousands): Fiscal Year Amount 2023 (9 months remaining) $ 133 2024 182 2025 185 2026 169 Total operating lease payments 669 Less: imputed interest (147) Present value of operating lease liabilities $ 522 |
Schedule of supplemental information relating to operating leases | Supplemental information related to operating leases was as follows: August 31, 2022 Weighted average remaining lease term 3.6 years Weighted average discount rate 10.0 % |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||
Aug. 31, 2022 | Aug. 31, 2021 | [1] | May 31, 2022 | Feb. 28, 2022 | |
Summary Of Significant Accounting Policies [Line Items] | |||||
Net loss | $ 20,991 | $ 45,337 | |||
Accumulated deficit | 782,857 | $ 766,131 | $ 782,900 | ||
Charge to APIC due to warrant modification | 4,200 | ||||
Change of fair value of liability-classified equity instrument upon reclassification | $ 8,601 | ||||
Bulk Drug Substance | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Shelf life | 4 years | 4 years | |||
[1] See Note 2, Summary of Significant Accounting Policies . |
Inventories, net (Details)
Inventories, net (Details) - USD ($) $ in Thousands | Aug. 31, 2022 | May 31, 2022 |
Inventories, net | ||
Raw materials | $ 16,264 | $ 16,264 |
Work-in-progress | 1,665 | 1,665 |
Inventories, net | $ 17,929 | $ 17,929 |
Inventories, net - Shelf-life (
Inventories, net - Shelf-life (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Aug. 31, 2022 USD ($) | Aug. 31, 2021 USD ($) | [1] | May 31, 2022 USD ($) item | |
Inventory Realizable Value | ||||
2023 | $ 6,903 | |||
2024 | 20,201 | |||
2025 | 31,241 | |||
2026 | 35,779 | |||
Inventories, gross | 94,124 | |||
Inventory charge | (76,195) | |||
Inventories, net | 17,929 | $ 17,929 | ||
Raw materials, net of reserves | 10,200 | |||
Raw materials | 16,264 | $ 16,264 | ||
Inventory write-off | 2,704 | $ 1,764 | ||
Number of batches not saleable | item | 5 | |||
Total number of batches manufactured | item | 9 | |||
Other Assets | Samsung BioLogics Co., Ltd. ("Samsung") | ||||
Inventory Realizable Value | ||||
Specialized raw materials | 2,700 | |||
Raw Materials | ||||
Inventory Realizable Value | ||||
2023 | 5,079 | |||
2024 | 18,536 | |||
2025 | 2,099 | |||
2026 | 3,435 | |||
Inventories, gross | 29,149 | |||
Inventory charge | (12,885) | |||
Inventories, net | 16,264 | |||
Specialized | ||||
Inventory Realizable Value | ||||
2023 | 3,658 | |||
2024 | 682 | |||
2025 | 2,099 | |||
2026 | 3,435 | |||
Inventories, gross | 9,874 | |||
Inventory charge | (9,874) | |||
Resins | ||||
Inventory Realizable Value | ||||
2024 | 16,264 | |||
Inventories, gross | 16,264 | |||
Inventories, net | 16,264 | |||
Resins | Minimum | ||||
Inventory Realizable Value | ||||
Remaining cycles of resins | 37 | |||
Resins | Maximum | ||||
Inventory Realizable Value | ||||
Remaining cycles of resins | 62 | |||
Other | ||||
Inventory Realizable Value | ||||
2023 | 1,421 | |||
2024 | 1,590 | |||
Inventories, gross | 3,011 | |||
Inventory charge | (3,011) | |||
Inventory write-off | $ 63,300 | |||
Number of batches not saleable | item | 4 | |||
Five Batches Of Drug Product | ||||
Inventory Realizable Value | ||||
Raw materials | $ 29,100 | |||
Four Batches Of Drug Product | ||||
Inventory Realizable Value | ||||
Raw materials | $ 34,200 | |||
Bulk Drug Substance | ||||
Inventory Realizable Value | ||||
2023 | 1,824 | |||
2024 | 1,665 | |||
Inventories, gross | 3,489 | |||
Inventory charge | (1,824) | |||
Inventories, net | $ 1,665 | |||
Shelf life | 4 years | 4 years | ||
Drug Products | ||||
Inventory Realizable Value | ||||
2025 | $ 29,142 | |||
2026 | 32,344 | |||
Inventories, gross | 61,486 | |||
Inventory charge | $ (61,486) | |||
[1] See Note 2, Summary of Significant Accounting Policies . |
Accounts Payable and Accrued _3
Accounts Payable and Accrued Liabilities (Details) $ in Thousands | 3 Months Ended | 12 Months Ended |
Aug. 31, 2022 USD ($) item | May 31, 2022 USD ($) item | |
Accounts Payable and Accrued Liabilities | ||
Accounts payable | $ 68,991 | $ 67,974 |
Number of vendors | item | 2 | 2 |
Compensation and related expense | $ 792 | $ 1,522 |
Legal fees and settlement | 1,017 | 2,006 |
Clinical expenses | 311 | 3,727 |
Unbilled inventory | 2,218 | 1,392 |
License fees | 541 | 150 |
Lease payable | 135 | 134 |
Other liabilities | 64 | |
Total accrued liabilities | $ 5,014 | $ 8,995 |
Accounts Payable | Credit Availability Concentration Risk | Vendor One | ||
Accounts Payable and Accrued Liabilities | ||
Concentration Risk, Percentage | 69% | |
Accounts Payable | Credit Availability Concentration Risk | Vendor Two | ||
Accounts Payable and Accrued Liabilities | ||
Concentration Risk, Percentage | 73% |
Convertible Instruments and A_3
Convertible Instruments and Accrued Interest - Preferred stock (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended |
Aug. 31, 2022 | May 31, 2022 | |
Class of Stock [Line Items] | ||
Accrued dividends | $ 4,361 | $ 3,977 |
Series B Convertible Preferred Stock | ||
Class of Stock [Line Items] | ||
Shares of preferred stock | 19 | 19 |
Total shares of common stock if converted | 190 | 190 |
Undeclared dividend | $ 11 | $ 10 |
Total shares of common stock if dividends converted | 22 | 20 |
Preferred stock dividend, value per share | $ 0.25 | |
Preferred stock, stated value per share | 5 | |
Preferred stock conversion price, per share | $ 0.50 | |
Undeclared dividend, shares | 10 | |
Series C Convertible Preferred Stock | ||
Class of Stock [Line Items] | ||
Shares of preferred stock | 6 | 7 |
Total shares of common stock if converted | 12,670 | 13,806 |
Accrued dividends | $ 2,186 | $ 2,014 |
Total shares of common stock if dividends converted | 4,372 | 4,028 |
Preferred stock dividend, value per share | $ 0.50 | |
Series D Convertible Preferred Stock | ||
Class of Stock [Line Items] | ||
Shares of preferred stock | 9 | 9 |
Total shares of common stock if converted | 10,565 | 10,565 |
Accrued dividends | $ 2,175 | $ 1,963 |
Total shares of common stock if dividends converted | 4,350 | 3,926 |
Preferred stock dividend, value per share | $ 0.80 | |
Series C and Series D Convertible Preferred Stock | ||
Class of Stock [Line Items] | ||
Preferred stock dividend rate, as a percent | 10% | |
Preferred stock, stated value per share | $ 1,000 |
Convertible Instruments and A_4
Convertible Instruments and Accrued Interest - Outstanding Balance (Details) - USD ($) $ in Thousands | Aug. 31, 2022 | May 31, 2021 |
Debt Instrument [Line Items] | ||
Convertible notes payable outstanding principal | $ 38,319 | $ 38,319 |
Less: Unamortized debt discount and issuance costs | (1,486) | (2,078) |
Convertible notes payable, net | 36,833 | 36,241 |
Accrued interest on convertible notes | 7,120 | 5,974 |
Outstanding convertible notes payable, net and accrued interest | 43,953 | 42,215 |
Long-term Convertible Note - April 2, 2021 Note | ||
Debt Instrument [Line Items] | ||
Convertible notes payable outstanding principal | 9,819 | 9,819 |
Less: Unamortized debt discount and issuance costs | (359) | (512) |
Convertible notes payable, net | 9,460 | 9,307 |
Accrued interest on convertible notes | 2,920 | 2,599 |
Outstanding convertible notes payable, net and accrued interest | 12,380 | 11,906 |
Long-term Convertible Note - April 23, 2021 Note | ||
Debt Instrument [Line Items] | ||
Convertible notes payable outstanding principal | 28,500 | 28,500 |
Less: Unamortized debt discount and issuance costs | (1,127) | (1,566) |
Convertible notes payable, net | 27,373 | 26,934 |
Accrued interest on convertible notes | 4,200 | 3,375 |
Outstanding convertible notes payable, net and accrued interest | $ 31,573 | $ 30,309 |
Convertible Instruments and A_5
Convertible Instruments and Accrued Interest - Components (Details) $ in Thousands | 3 Months Ended |
Aug. 31, 2022 USD ($) | |
Debt Instrument [Line Items] | |
Outstanding balance, beginning | $ 42,215 |
Amortization of issuance discount and costs | 592 |
Interest expense | 1,146 |
Outstanding balance, ending | 43,953 |
Long-term Convertible Note - April 2, 2021 Note | |
Debt Instrument [Line Items] | |
Outstanding balance, beginning | 11,906 |
Amortization of issuance discount and costs | 153 |
Interest expense | 321 |
Outstanding balance, ending | 12,380 |
Long-term Convertible Note - April 23, 2021 Note | |
Debt Instrument [Line Items] | |
Outstanding balance, beginning | 30,309 |
Amortization of issuance discount and costs | 439 |
Interest expense | 825 |
Outstanding balance, ending | $ 31,573 |
Convertible Instruments and A_6
Convertible Instruments and Accrued Interest - Long-term Convertible Note - April 2, 2021 Note (Detail) - USD ($) $ / shares in Units, $ in Thousands, shares in Millions | 3 Months Ended | 12 Months Ended | |||
Apr. 02, 2021 | Aug. 31, 2022 | Aug. 31, 2021 | May 31, 2022 | May 31, 2021 | |
Debt Instrument [Line Items] | |||||
Amortization of issuance discount and costs | $ 592 | ||||
Net carrying value of note | 43,953 | $ 42,215 | |||
Long-term Convertible Note - April 2, 2021 Note | |||||
Debt Instrument [Line Items] | |||||
Debt instrument term | 2 years | ||||
Convertible note, aggregate principal | $ 28,500 | ||||
Net Proceeds | 25,000 | ||||
Unamortized discount | 3,400 | ||||
Debt issuance costs | 100 | ||||
Conversion of principal and interest of convertible notes to common stock | $ 3,500 | ||||
Convertible notes, interest rate | 10% | ||||
Percentage increase in amount payable on default | 15% | ||||
Percentage increase in amount payable, second scenario | 10% | ||||
Percentage increase in amount payable, third default scenario | 5% | ||||
Conversion price per share | $ 10 | ||||
Number of days of notice to be given for conversion of notes into common stock | 5 days | ||||
Shares reserved | 6 | ||||
Debt instrument lock in period | 6 months | ||||
Number of days of notice to be given for redemption | 3 days | ||||
Debt instrument prepayment percentage premium | 15% | ||||
Number of days of notice to be given for prepayment | 15 days | ||||
Debt proceeds requiring investor consent | $ 50,000 | ||||
Additional debt, increase in interest rate | 5% | ||||
Amortization of issuance discount and costs | 153 | ||||
Net carrying value of note | 12,380 | $ 11,906 | |||
Loss on induced conversion | $ 0 | $ 0 | $ 18,800 | ||
Debt instrument, decrease in debt per month | $ 7,500 | ||||
Debt instrument term of reduced outstanding amount | 5 months | ||||
Conversion of Series C convertible preferred stock to common stock (in shares) | 25.3 | ||||
Long-term Convertible Note - April 2, 2021 Note | Maximum | |||||
Debt Instrument [Line Items] | |||||
Convertible notes, interest rate | 22% | ||||
Partitioned Notes Of April 2021 Notes [Member] | |||||
Debt Instrument [Line Items] | |||||
Convertible note, aggregate principal | $ 9,800 | $ 18,700 |
Convertible Instruments and A_7
Convertible Instruments and Accrued Interest - Long-term Convertible Note - April 23, 2021 Note (Detail) - USD ($) $ / shares in Units, $ in Thousands, shares in Millions | 3 Months Ended | ||
Apr. 23, 2021 | Aug. 31, 2022 | May 31, 2021 | |
Debt Instrument [Line Items] | |||
Amortization of issuance discount and costs | $ 592 | ||
Net carrying value of note | $ 43,953 | $ 42,215 | |
Warrants to purchase common shares, shares | 5.5 | ||
Indemnitors | |||
Debt Instrument [Line Items] | |||
Warrants to purchase common shares, shares | 30 | ||
Long-term Convertible Note - April 23, 2021 Note | |||
Debt Instrument [Line Items] | |||
Debt instrument term | 2 years | ||
Convertible note, aggregate principal | $ 28,500 | ||
Net Proceeds | 25,000 | ||
Unamortized discount | 3,400 | ||
Debt issuance costs | $ 100 | ||
Convertible notes, interest rate | 10% | ||
Percentage increase in amount payable on default | 15% | ||
Percentage increase in amount payable, second scenario | 10% | ||
Percentage increase in amount payable, third default scenario | 5% | ||
Conversion price per share | $ 10 | ||
Number of days of notice to be given for conversion of notes into common stock | 5 days | ||
Shares reserved | 6 | ||
Debt instrument lock in period | 6 months | ||
Number of days of notice to be given for redemption | 3 days | ||
Threshold trading days to satisfy redemption obligation | 3 days | ||
Debt instrument prepayment percentage premium | 15% | ||
Number of days of notice to be given for prepayment | 15 days | ||
Debt proceeds requiring investor consent | $ 75,000 | ||
Additional debt, increase in interest rate | 5% | ||
Amortization of issuance discount and costs | $ 439 | ||
Net carrying value of note | $ 31,573 | $ 30,309 | |
Maximum | Long-term Convertible Note - April 23, 2021 Note | |||
Debt Instrument [Line Items] | |||
Conversion of principal and interest of convertible notes to common stock | $ 7,000 | ||
Convertible notes, interest rate | 22% |
Equity Awards - Activity (Detai
Equity Awards - Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended |
Aug. 31, 2022 | May 31, 2022 | |
Derivative Liability [Abstract] | ||
Derivative liability (beginning balance) | ||
Classified as liability due to lack of shares availability at issuance | 14,522 | |
Classified as equity upon increase in availability | (23,123) | |
Loss on derivative due to change in fair market value | 8,601 | |
Derivative liability (ending balance) | ||
Stock option and warrant activity | ||
Options and warrants outstanding, Number of Shares | 90,705 | |
Granted, Number of Shares | 104,104 | |
Exercised, Number of Shares | (863) | |
Forfeited/expired/cancelled, Number of Shares | (484) | |
Options and warrants outstanding, Number of Shares | 193,462 | 90,705 |
Options and warrants outstanding and exercisable, Number of Shares | 187,896 | |
Options and warrants outstanding, Weighted Average Exercise Price | $ 0.77 | |
Granted, Weighted Average Exercise Price | 0.25 | |
Exercised, Weighted Average Exercise Price | 0.49 | |
Forfeited/expired/cancelled, Weighted Average Exercise Price | 1.57 | |
Options and warrants outstanding, Weighted Average Exercise Price | 0.48 | $ 0.77 |
Options and warrants outstanding and exercisable, Weighted Average Exercise Price | $ 0.45 | |
Options and warrants outstanding, Weighted Average Remaining Contractual Life in Years | 4 years 4 months 9 days | 4 years 21 days |
Options and warrants outstanding and exercisable, Weighted Average Remaining Contractual Life in Years | 4 years 2 months 26 days | |
Options and warrants outstanding, Aggregate Intrinsic Value | $ 36,758 | $ 352 |
Options and warrants outstanding and exercisable, Aggregate Intrinsic Value | $ 36,717 | |
Stock option vested, Shares | 11,900,000 | |
Options outstanding, nonvested | 5,300,000 | |
Loss on derivatives | $ 8,601 |
Equity Awards - Options, RSUs,
Equity Awards - Options, RSUs, PSUs (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||
Aug. 31, 2022 USD ($) plan shares | Aug. 31, 2021 USD ($) | May 31, 2022 shares | Aug. 30, 2022 shares | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Common stock, shares authorized | 1,350,000,000 | 1,350,000,000 | 1,000,000,000 | |||
Number of active plans | plan | 1 | |||||
Number of inactive plans | plan | 1 | |||||
Proceeds from stock option exercises | $ | [1] | $ 189 | ||||
Stock-based compensation | $ | $ 1,341 | $ 2,597 | [1] | |||
Stock Options | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stock option granted, Shares | 200,000 | |||||
Award vesting period | 4 years | |||||
Options term | 10 years | |||||
Time Based Restricted Stock Units | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Common stock shares issued with time based vesting RSU | 200,000 | |||||
Stock-based compensation | $ | $ 100 | |||||
Performance Shares [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Common stock shares issued with time based vesting RSU | 0 | |||||
2012 Equity Incentive Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Number of shares authorized for issuance | 34,300,000 | |||||
Increase in number of shares authorized | 350,000,000 | |||||
Shares reallocated to be used for general purposes | 22,000,000 | |||||
Percentage of share outstanding | 1% | |||||
Shares available for future stock-based grants | 3,900,000 | |||||
2012 Equity Incentive Plan | Management, Employees And Consultants | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Shares available for future stock-based grants | 22,000,000 | |||||
[1] See Note 2, Summary of Significant Accounting Policies . |
Equity Awards - Private Placeme
Equity Awards - Private Placement of Shares of Common Stock and Warrants (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Aug. 31, 2022 | Aug. 30, 2022 | Feb. 14, 2022 | Aug. 31, 2022 | Jun. 30, 2022 | Aug. 31, 2021 | May 31, 2022 | Jul. 18, 2022 | Jul. 17, 2022 | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Exercise price of warrants, per share | $ 0.255 | $ 0.40 | $ 0.255 | ||||||||
Loss on derivatives | $ (8,601,000) | ||||||||||
Warrant exercises (in shares) | 500,000 | ||||||||||
Warrant exercises | $ 264,000 | $ 503,000 | [1] | ||||||||
Exercise of warrants for cash | $ 300,000 | ||||||||||
Cashless exercise of warrants, shares | 200,000 | ||||||||||
Cashless exercise of warrants, warrants | 300,000 | ||||||||||
Shares issued during the period new issues shares | 4,600,000 | ||||||||||
Change of fair value of liability-classified equity instrument upon reclassification | $ 8,601,000 | ||||||||||
Common stock warrants to purchase shares | 5,500,000 | 5,500,000 | |||||||||
Proceeds from warrant exercises | $ 264,000 | 503,000 | [2] | ||||||||
Proceeds from warrant transactions, net of offering costs | [2] | 775,000 | |||||||||
Warrant covering common stock shares purchased, percentage | 75% | 50% | |||||||||
Placement agent fees and expenses | $ 2,800,000 | ||||||||||
Incremental fair value of warrants | $ 4,200,000 | ||||||||||
Former CEO | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Compensation policy period | 18 months | ||||||||||
Shares issued during the period new issues shares | 88,983 | ||||||||||
Former General Counsel | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Compensation policy period | 12 months | ||||||||||
Shares issued during the period new issues shares | 79,391 | ||||||||||
Private Equity Offering | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Stock issued for private offerings | $ 17,544,000 | 2,872,000 | [1] | ||||||||
Accredited Investors | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Shares issued during the period new issues shares | 85,400,000 | ||||||||||
Stock issued for private offerings | $ 18,900,000 | ||||||||||
Proceeds, net of issuance costs | $ 7,700,000 | ||||||||||
Private Warrant Exchange [Member] | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Warrant exercises | [1] | 775,000 | |||||||||
Allotment to placement agent | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Exercise price of warrants, per share | $ 0.40 | $ 0.255 | |||||||||
Common stock warrants to purchase shares | 19,400,000 | ||||||||||
Term of warrants | 10 years | ||||||||||
Warrant covering common stock shares purchased, percentage | 13% | ||||||||||
Placement agent fees and expenses | $ 50,000 | ||||||||||
Second Private Placement | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Exercise price of warrants, per share | $ 0.306 | ||||||||||
Exercise price of stock warrant combo, per share | $ 0.255 | ||||||||||
Shares issued during the period new issues shares | 34,600,000 | ||||||||||
Common stock warrants to purchase shares | 64,000,000 | ||||||||||
Term of warrants | 5 years | ||||||||||
Number of common shares in a fixed combination issue of shares | 1 | ||||||||||
Number Of Warrants In Fixed Combination Issue Of Securities | 1 | ||||||||||
Warrant exercise price percentage of final unit price | 120% | ||||||||||
Surety Bond Backstop Agreement | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Stock based compensation | $ 5,300,000 | $ 0 | |||||||||
Interest rate | 10% | ||||||||||
Period of Indemnification, Payment by Indemnitors | 90 days | ||||||||||
Indemnification Fee Payment Ratio | 1.50% | ||||||||||
Initial Warrant | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Common stock warrants to purchase shares | 15,000,000 | ||||||||||
Make-Whole Warrant | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Common stock warrants to purchase shares | 15,000,000 | ||||||||||
Four Good Warrants | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Exercise price of warrants, per share | $ 0.20 | $ 0.30 | |||||||||
Change of fair value of liability-classified equity instrument upon reclassification | $ 6,600,000 | ||||||||||
Term of warrants | 5 years | ||||||||||
Maximum | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Exercise price of warrants, per share | $ 0.75 | $ 0.75 | |||||||||
Warrant covering common stock shares purchased, percentage | 0.50% | ||||||||||
Maximum | Allotment to placement agent | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Exercise price of warrants, per share | 0.255 | $ 0.255 | |||||||||
Minimum | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Exercise price of warrants, per share | 0.45 | 0.45 | |||||||||
Cashless exercise of warrants, exercise price | $ 0.40 | $ 0.40 | |||||||||
[1] See Note 2, Summary of Significant Accounting Policies . See Note 2, Summary of Significant Accounting Policies . |
Equity Awards - Expense and unr
Equity Awards - Expense and unrecognized (Details) - USD ($) $ in Thousands, shares in Millions | 3 Months Ended | ||
Aug. 31, 2022 | Aug. 31, 2021 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Compensation expense | $ 1,341 | $ 2,597 | [1] |
Common stock warrants to purchase shares | 5.5 | ||
Surety Bond Backstop Agreement | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock based compensation | $ 5,300 | 0 | |
Equity Instruments | General and Administrative Expenses | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Compensation expense | $ 1,300 | $ 2,600 | |
[1] See Note 2, Summary of Significant Accounting Policies . |
Equity Awards - Stock Options a
Equity Awards - Stock Options and Other Equity Awards (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | |||
Apr. 30, 2022 | Aug. 31, 2022 | Aug. 31, 2021 | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Proceeds from stock option exercises | [1] | $ 189 | |||
Options outstanding, nonvested | 5,300,000 | ||||
Stock-based compensation | $ 1,341 | $ 2,597 | [1] | ||
Warrant exercises (in shares) | 500,000 | ||||
Shares issued during the period new issues shares | 4,600,000 | ||||
Common Stock | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock issued for bonuses and tendered for income tax (in shares) | 1,014,000 | ||||
Warrant exercises (in shares) | 657,000 | 668,000 | |||
Stock option exercises (in shares) | 300,000 | ||||
Executives | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Percent of salary in lieu of cash, net of payroll deductions and withholding taxes | 25% | ||||
Shares issued | 235,676 | ||||
Stock Options | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Options term | 10 years | ||||
Stock option granted, Shares | 200,000 | ||||
Award vesting period | 4 years | ||||
Stock Options | Maximum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock option granted, exercise price | $ 0.67 | ||||
Stock options grant date fair value | 0.54 | ||||
Stock Options | Minimum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock option granted, exercise price | 0.41 | ||||
Stock options grant date fair value | $ 0.33 | ||||
[1] See Note 2, Summary of Significant Accounting Policies . |
Loss Per Common Share - Summary
Loss Per Common Share - Summary of Reconciliation of Net Loss Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | ||
Aug. 31, 2022 | Aug. 31, 2021 | ||
Loss Per Common Share | |||
Net loss | $ (20,991) | $ (45,337) | [1] |
Less: Deemed dividends due to down round provision | (4,154) | ||
Less: Accrued preferred stock dividends | (385) | (425) | |
Net loss applicable to common stockholders | $ (25,530) | $ (45,762) | |
Weighted average common shares outstanding, Basic | 787,856 | 632,597 | [1] |
Weighted average common shares outstanding, Diluted | 787,856 | 632,597 | |
Loss per share, Basic | $ (0.03) | $ (0.07) | [1] |
Loss per share, Diluted | $ (0.03) | $ (0.07) | |
[1] See Note 2, Summary of Significant Accounting Policies . |
Loss Per Common Share - Summa_2
Loss Per Common Share - Summary of Weighted Average Number of Shares of Common Stock Outstanding (Details) shares in Thousands | 3 Months Ended |
Aug. 31, 2022 shares | |
Stock options, warrants & unvested restricted stock | |
Antidilutive Securities Excluded from Computation of Earnings Per Share | |
Antidilutive securities excluded from computation of loss per common share | 193,609 |
Convertible notes | |
Antidilutive Securities Excluded from Computation of Earnings Per Share | |
Antidilutive securities excluded from computation of loss per common share | 12,000 |
Convertible Preferred Stock | |
Antidilutive Securities Excluded from Computation of Earnings Per Share | |
Antidilutive securities excluded from computation of loss per common share | 32,170 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Aug. 31, 2022 | Aug. 31, 2021 | [1] | May 31, 2022 | |
Income Taxes | ||||
Income tax expense | $ 0 | $ 0 | ||
Effective Income Tax Rate Reconciliation Percent | ||||
Income tax provision at statutory rate | 21% | 21% | ||
Effective income tax rate | 0% | 0% | ||
[1] See Note 2, Summary of Significant Accounting Policies . |
Commitments and Contingencies_2
Commitments and Contingencies (Details) $ in Thousands | 3 Months Ended | |||
Jun. 04, 2021 lawsuit | Aug. 31, 2022 USD ($) | Jan. 31, 2022 USD ($) | Jan. 06, 2022 USD ($) | |
Shareholder Derivative Lawsuits | ||||
Commitments and Contingencies | ||||
Consolidated number of lawsuits | lawsuit | 3 | |||
Samsung BioLogics Co., Ltd. ("Samsung") | ||||
Commitments and Contingencies | ||||
Forecast period | 3 years | |||
Amount of material breach of' Master Services and Project Specific Agreements | $ 13,500 | |||
Additional Contractual Obligation | $ 22,800 | |||
Past due balance | $ 232,788 | |||
Accounts Payable | Samsung BioLogics Co., Ltd. ("Samsung") | ||||
Commitments and Contingencies | ||||
Past due balance | $ 35,700 |
Commitments and Contingencies -
Commitments and Contingencies - Summary of Future Commitments (Details) - Samsung BioLogics Co., Ltd. ("Samsung") $ in Thousands | Aug. 31, 2022 USD ($) |
Fiscal Year | |
2023 (9 months remaining) | $ 34,638 |
2024 | 121,750 |
2025 | 76,400 |
Total | $ 232,788 |
Commitments and Contingencies_3
Commitments and Contingencies - Summary of Operating Lease Balances (Details) - USD ($) | 3 Months Ended | ||
Aug. 31, 2022 | Aug. 31, 2021 | May 31, 2022 | |
Commitments and Contingencies. | |||
Operating lease costs | $ 46,000 | $ 48,900 | |
Right of use asset | $ 502,000 | $ 536,000 | |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | Other Assets, Noncurrent | Other Assets, Noncurrent | |
Current operating lease liability | $ 135,000 | $ 134,000 | |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Accrued Compensation And Non-financing Liabilities | Accrued Compensation And Non-financing Liabilities | |
Non-current operating lease liability | $ 387,000 | $ 422,000 | |
Total operating lease liability | $ 522,000 | $ 556,000 |
Commitments and Contingencies_4
Commitments and Contingencies - Summary of Minimum (Base Rental) Lease Payments (Details) - USD ($) $ in Thousands | Aug. 31, 2022 | May 31, 2022 |
Fiscal Year | ||
2023 (9 months remaining) | $ 133 | |
2024 | 182 | |
2025 | 185 | |
2026 | 169 | |
Total operating lease payments | 669 | |
Less: imputed interest | (147) | |
Present value of operating lease liabilities | $ 522 | $ 556 |
Commitments and Contingencies_5
Commitments and Contingencies - Supplemental Information Related to Operating Leases (Details) | Aug. 31, 2022 |
Commitments and Contingencies. | |
Weighted average remaining lease term | 3 years 7 months 6 days |
Weighted average discount rate | 10% |
Subsequent Events (Details)
Subsequent Events (Details) | 1 Months Ended | 2 Months Ended | 3 Months Ended | 12 Months Ended | ||
Sep. 20, 2022 item $ / shares shares | Sep. 06, 2022 individual item $ / shares shares | Sep. 30, 2022 shares | Oct. 31, 2022 shares | Aug. 31, 2022 shares | May 31, 2022 | |
Chief Executive Officer | ||||||
Subsequent Event [Line Items] | ||||||
Number of severance months | 18 months | |||||
Former CEO | ||||||
Subsequent Event [Line Items] | ||||||
Number of severance months | 18 months | |||||
Stock Options | ||||||
Subsequent Event [Line Items] | ||||||
Stock option granted, Shares | 200,000 | |||||
Options term | 10 years | |||||
Time Based Restricted Stock Units | ||||||
Subsequent Event [Line Items] | ||||||
Common stock issued for other than options | 200,000 | |||||
Performance Shares [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Common stock issued for other than options | 0 | |||||
Subsequent Event | Chief Executive Officer | ||||||
Subsequent Event [Line Items] | ||||||
Stocks issued for severance payment | 80,816 | |||||
Subsequent Event | Scientific Advisory Board | ||||||
Subsequent Event [Line Items] | ||||||
Stock option granted, Shares | 50,000 | |||||
Subsequent Event | 2012 Equity Incentive Plan | ||||||
Subsequent Event [Line Items] | ||||||
Stock option granted, exercise price | $ / shares | $ 0.50 | |||||
Options term | 10 years | |||||
Subsequent Event | 2012 Equity Incentive Plan | Fully vested nonqualified stock options | ||||||
Subsequent Event [Line Items] | ||||||
Number Of Nonemployee Directors | individual | 3 | |||||
Subsequent Event | 2012 Equity Incentive Plan | Fully vested nonqualified stock options | Tanya Durkee Urbach | ||||||
Subsequent Event [Line Items] | ||||||
Stock option granted, Shares | 112,500 | |||||
Subsequent Event | 2012 Equity Incentive Plan | Fully vested nonqualified stock options | Lishomwa Ndhlovu | ||||||
Subsequent Event [Line Items] | ||||||
Stock option granted, Shares | 112,500 | |||||
Subsequent Event | 2012 Equity Incentive Plan | Fully vested nonqualified stock options | Karen J Brunke | ||||||
Subsequent Event [Line Items] | ||||||
Stock option granted, Shares | 37,500 | |||||
Subsequent Event | 2012 Equity Incentive Plan | Fully vested nonqualified stock options | Dr. Ndhlovu, SAB Member | ||||||
Subsequent Event [Line Items] | ||||||
Stock option granted, Shares | 50,000 | |||||
Subsequent Event | 2012 Equity Incentive Plan | Partially vested nonqualified stock options | ||||||
Subsequent Event [Line Items] | ||||||
Number Of Nonemployee Directors | individual | 4 | |||||
Subsequent Event | 2012 Equity Incentive Plan | Partially vested nonqualified stock options | Ms. Urbach, Ms. Brunke and Dr. Ndhlovu | ||||||
Subsequent Event [Line Items] | ||||||
Stock option granted, Shares | 247,111 | |||||
Number of equal monthly installments over which balance shares are vesting | item | 9 | |||||
Subsequent Event | 2012 Equity Incentive Plan | Partially vested nonqualified stock options | Ryan Dunlap | ||||||
Subsequent Event [Line Items] | ||||||
Stock option granted, Shares | 185,333 | |||||
Number of equal monthly installments over which balance shares are vesting | item | 9 | |||||
Subsequent Event | 2012 Equity Incentive Plan | Partially vested nonqualified stock options | Tranche One [Member] | Ms. Urbach, Ms. Brunke and Dr. Ndhlovu | ||||||
Subsequent Event [Line Items] | ||||||
Vesting percentage | 25% | |||||
Subsequent Event | 2012 Equity Incentive Plan | Stock Options | President [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Stock option granted, Shares | 1,575,557 | |||||
Number of equal monthly installments over which balance shares are vesting | item | 36 | |||||
Stock option granted, exercise price | $ / shares | $ 0.58 | |||||
Subsequent Event | 2012 Equity Incentive Plan | Stock Options | CFO | ||||||
Subsequent Event [Line Items] | ||||||
Stock option granted, Shares | 630,222 | |||||
Number of equal monthly installments over which balance shares are vesting | item | 36 | |||||
Stock option granted, exercise price | $ / shares | $ 0.58 | |||||
Subsequent Event | 2012 Equity Incentive Plan | Stock Options | Tranche One [Member] | President [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Vesting percentage | 25% | |||||
Subsequent Event | 2012 Equity Incentive Plan | Stock Options | Tranche One [Member] | CFO | ||||||
Subsequent Event [Line Items] | ||||||
Vesting percentage | 25% | |||||
Subsequent Event | 2012 Equity Incentive Plan | Restricted Stock Units (RSUs) [Member] | President [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Number of equal annual installments | item | 4 | |||||
Common stock issued for other than options | 646,552 | |||||
Subsequent Event | 2012 Equity Incentive Plan | Performance Shares [Member] | President [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Common stock issued for other than options | 646,552 |