Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Feb. 12, 2018 | Jun. 30, 2017 | |
Document and Entity Information | |||
Entity Registrant Name | Trovagene, Inc. | ||
Entity Central Index Key | 1,213,037 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Accelerated Filer | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2017 | ||
Document Fiscal Year Focus | 2,017 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Entity Common Stock, Shares Outstanding (shares) | 55,290,162 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | Yes | ||
Entity Current Reporting Status | Yes | ||
Entity Public Float | $ 38,261,592 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Dec. 31, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 8,225,764 | $ 13,915,094 |
Short-term investments | 0 | 23,978,022 |
Accounts receivable | 77,095 | 100,460 |
Prepaid expenses and other current assets | 1,165,828 | 956,616 |
Total current assets | 9,468,687 | 38,950,192 |
Property and equipment, net | 2,426,312 | 3,826,915 |
Other assets | 389,942 | 1,173,304 |
Total Assets | 12,284,941 | 43,950,411 |
Current liabilities: | ||
Accounts payable | 825,244 | 1,130,536 |
Accrued liabilities | 1,454,587 | 4,021,365 |
Deferred rent | 334,424 | 285,246 |
Current portion of long-term debt (in default) | 1,331,515 | 2,360,109 |
Total current liabilities | 3,945,770 | 7,797,256 |
Long-term debt, less current portion | 0 | 14,176,359 |
Derivative financial instruments—warrants | 649,387 | 834,940 |
Deferred rent, net of current portion | 1,183,677 | 1,373,717 |
Total liabilities | 5,778,834 | 24,182,272 |
Commitments and contingencies | ||
Stockholders’ equity | ||
Preferred stock, $0.001 par value, 20,000,000 shares authorized, 60,600 shares outstanding at each of December 31, 2017 and 2016, designated as Series A Convertible Preferred Stock with liquidation preference of $606,000 at each of December 31, 2017 and 2016 | 60 | 60 |
Common stock, $0.0001 par value, 150,000,000 shares authorized at December 31, 2017 and 2016; 52,791,584 and 30,696,791 issued and outstanding at December 31, 2017 and 2016, respectively | 5,279 | 3,070 |
Additional paid-in capital | 179,546,954 | 167,890,984 |
Accumulated other comprehensive loss | 0 | (10,773) |
Accumulated deficit | (173,046,186) | (148,115,202) |
Total stockholders’ equity | 6,506,107 | 19,768,139 |
Total Liabilities and Stockholders’ Equity | $ 12,284,941 | $ 43,950,411 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) | Dec. 31, 2017 | Dec. 31, 2016 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (in shares) | 20,000,000 | 20,000,000 |
Preferred stock, shares outstanding (in shares) | 60,600 | 60,600 |
Series A Convertible Preferred Stock, liquidation preference | $ 606,000 | $ 606,000 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized(in shares) | 150,000,000 | 150,000,000 |
Common stock, shares issued (in shares) | 52,791,584 | 30,696,791 |
Common stock, shares outstanding(in shares) | 52,791,584 | 30,696,791 |
Consolidated Statements of Oper
Consolidated Statements of Operations and Comprehensive Loss - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Income Statement [Abstract] | ||
Royalties | $ 285,444 | $ 258,062 |
Diagnostic services | 196,111 | 86,137 |
Clinical research services | 23,849 | 36,873 |
Total revenues | 505,404 | 381,072 |
Costs and expenses: | ||
Cost of revenue | 1,811,424 | 1,730,512 |
Research and development | 7,882,650 | 15,006,642 |
Selling and marketing | 2,735,410 | 11,523,144 |
General and administrative | 11,497,466 | 11,475,947 |
Restructuring charges | 2,174,251 | 790,438 |
Total operating expenses | 26,101,201 | 40,526,683 |
Loss from operations | (25,595,797) | (40,145,611) |
Interest income | 147,883 | 298,829 |
Interest expense | (1,033,939) | (1,674,341) |
Other loss, net | (170,138) | (144,733) |
Loss on extinguishment of debt | (1,655,825) | 0 |
Gain from changes in fair value of derivative financial instruments—warrants | 3,401,072 | 2,462,137 |
Net loss | (24,906,744) | (39,203,719) |
Preferred stock dividend | (24,240) | (24,240) |
Net loss attributable to common stockholders | $ (24,930,984) | $ (39,227,959) |
Net loss per common share - basic (in dollars per share) | $ (0.72) | $ (1.30) |
Net loss per common share - diluted (in dollars per share) | $ (0.72) | $ (1.37) |
Weighted-average shares outstanding - basic (in shares) | 34,680,362 | 30,174,838 |
Weighted-average shares outstanding - diluted (in shares) | 34,680,362 | 30,281,263 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) | Total | Preferred Stock | Common Stock | Additional Paid-In Capital | Accumulated other comprehensive loss | Accumulated Deficit |
Balance (in shares) at Dec. 31, 2015 | 60,600 | 29,737,601 | ||||
Balance at Dec. 31, 2015 | $ 48,701,289 | $ 60 | $ 2,974 | $ 157,585,498 | $ 0 | $ (108,887,243) |
Increase (Decrease) in Stockholders' Equity | ||||||
Sale of common stock, net of expenses (in shares) | 421,810 | |||||
Sale of common stock, net of expenses | 2,285,415 | $ 42 | 2,285,373 | |||
Stock-based compensation | 7,504,316 | 7,504,316 | ||||
Issuance of warrant in connection with debt agreement | 148,885 | 148,885 | ||||
Issuance of common stock upon net exercise of warrant (in shares) | 2,651 | |||||
Issuance of common stock upon net exercise of warrant | 0 | $ 0 | 0 | |||
Issuance of common stock upon releases of restricted stock units (in shares) | 95,000 | |||||
Issuance of common stock upon vesting of restricted stock units | $ 10 | (10) | ||||
Reversal of previous loss from foreign currency translation | (1,708) | (1,708) | ||||
Reversal of previous loss on securities available-for-sale | (9,065) | (9,065) | ||||
Issuance of common stock upon net exercise of stock option (in shares) | 341,333 | |||||
Issuance of common stock upon net exercise of stock options | $ 34 | (34) | ||||
Issuance of common stock upon exercise of stock options (in shares) | 98,396 | |||||
Issuance of common stock upon exercise of stock options | 366,966 | $ 10 | 366,956 | |||
Preferred stock dividend | (24,240) | (24,240) | ||||
Net loss | (39,203,719) | (39,203,719) | ||||
Balance (in shares) at Dec. 31, 2016 | 60,600 | 30,696,791 | ||||
Balance at Dec. 31, 2016 | 19,768,139 | $ 60 | $ 3,070 | 167,890,984 | (10,773) | (148,115,202) |
Increase (Decrease) in Stockholders' Equity | ||||||
Sale of common stock, net of expenses (in shares) | 20,976,914 | |||||
Sale of common stock, net of expenses | 10,861,113 | $ 2,097 | 10,859,016 | |||
Stock-based compensation | 4,012,585 | 4,012,585 | ||||
Derivative liability-fair value of warrants issued | (3,215,519) | (3,215,519) | ||||
Issuance of common stock upon releases of restricted stock units (in shares) | 372,487 | |||||
Issuance of common stock upon vesting of restricted stock units | $ 37 | (37) | ||||
Issuance of common stock upon vesting of restricted stock awards (in shares) | 745,392 | |||||
Issuance of common stock upon vesting of restricted stock awards | $ 75 | (75) | ||||
Reversal of previous loss from foreign currency translation | 1,708 | 1,708 | ||||
Reversal of previous loss on securities available-for-sale | 9,065 | 9,065 | ||||
Preferred stock dividend | (24,240) | (24,240) | ||||
Net loss | (24,906,744) | (24,906,744) | ||||
Balance (in shares) at Dec. 31, 2017 | 60,600 | 52,791,584 | ||||
Balance at Dec. 31, 2017 | $ 6,506,107 | $ 60 | $ 5,279 | $ 179,546,954 | $ 0 | $ (173,046,186) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Operating activities | ||
Net loss | $ (24,906,744) | $ (39,203,719) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Loss on disposal of assets | 455,051 | 577,314 |
Impairment loss | 589,700 | 0 |
Depreciation and amortization | 1,247,576 | 1,069,547 |
Stock-based compensation expense | 4,012,585 | 7,504,316 |
Loss on extinguishment of debt | 1,655,825 | 0 |
Accretion of final fee premium | 293,614 | 390,548 |
Amortization of discount on debt | 113,780 | 173,803 |
Net realized loss on short-term investments | 6,400 | 0 |
Amortization of premiums on short-term investments | 9,230 | 107,261 |
Deferred rent | (140,863) | (201,037) |
Interest income accrued on short-term investments | (90,330) | (84,182) |
Change in fair value of derivative financial instruments—warrants | (3,401,072) | (2,462,137) |
Changes in operating assets and liabilities: | ||
Increase in other assets | 0 | (789,739) |
Decrease (increase) in accounts receivable | 23,365 | (1,724) |
Increase in prepaid expenses and other current assets | (208,185) | (277,327) |
(Decrease) increase in accounts payable and accrued expenses | (2,940,999) | 2,157,221 |
Net cash used in operating activities | (23,281,067) | (31,039,855) |
Investing activities | ||
Capital expenditures | (101,101) | (823,483) |
Proceeds from disposals of capital equipment | 1,540 | 0 |
Maturities of short-term investments | 16,431,837 | 13,750,000 |
Purchases of short-term investments | (8,804,604) | (37,760,166) |
Sales of short-term investments | 16,434,553 | 0 |
Net cash provided by (used in) investing activities | 23,962,225 | (24,833,649) |
Financing activities | ||
Proceeds from sale of common stock and warrants | 11,727,153 | 2,364,801 |
Payments of stock issuance costs | (866,039) | (79,386) |
Proceeds from exercise of options | 366,966 | |
Borrowings under equipment line of credit | 0 | 792,251 |
Repayments under equipment line of credit | (626,104) | (52,175) |
Proceeds from borrowings under long-term debt, net of costs | 0 | 7,805,085 |
Payment upon debt extinguishment | (1,613,067) | 0 |
Repayments of long-term debt | (15,000,000) | (8,896,166) |
Net cash (used in) provided by financing activities | (6,378,057) | 2,301,376 |
Effect of exchange rate changes on cash and cash equivalents | 7,569 | (5,825) |
Net change in cash and cash equivalents | (5,689,330) | (53,577,953) |
Cash and cash equivalents—Beginning of period | 13,915,094 | 67,493,047 |
Cash and cash equivalents—End of period | 8,225,764 | 13,915,094 |
Supplementary disclosure of cash flow activity: | ||
Cash paid for taxes | 800 | 4,560 |
Cash paid for interest | 668,465 | 1,103,677 |
Supplemental disclosure of non-cash investing and financing activities: | ||
Warrants issued in connection with long-term debt | 0 | 148,885 |
Preferred stock dividends accrued | 24,240 | 24,240 |
Leasehold improvements paid for by lessor | $ 0 | $ 1,860,000 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss Statement - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Statement of Comprehensive Income [Abstract] | ||
Net loss | $ (24,906,744) | $ (39,203,719) |
Other comprehensive loss: | ||
Foreign currency translation loss or reversal of previous loss | 1,708 | (1,708) |
Unrealized gain or reversal of previous loss on securities available-for-sale | 9,065 | (9,065) |
Total other comprehensive loss | 10,773 | (10,773) |
Total comprehensive loss | (24,895,971) | (39,214,492) |
Preferred stock dividend | (24,240) | (24,240) |
Comprehensive loss attributable to common stockholders | $ (24,920,211) | $ (39,238,732) |
Business Overview and Liquidity
Business Overview and Liquidity | 12 Months Ended |
Dec. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Business Overview and Going Concerns | Business Overview and Going Concerns Business Organization and Overview Trovagene, Inc. (“Trovagene” or the “Company”) headquartered in San Diego, California, is a clinical-stage, precision medicine oncology therapeutics company. The Company’s primary focus is to develop oncology therapeutics for improved cancer care and to optimize drug development by leveraging its proprietary Precision Cancer Monitoring ® (“PCM”) technology in tumor genomics. Trovagene’s lead drug candidate, PCM-075, is a Polo-like Kinase 1 (“PLK1”) selective adenosine triphosphate (“ATP”) competitive inhibitor. PCM-075 has shown preclinical antitumor activity as a single agent and synergy in combination with more than ten different chemotherapeutics and targeted therapies, such as Zytiga ® (abiraterone acetate), Beleodaq ® (belinostat), Quizartinib (AC220), a development stage FLT3 inhibitor, and Velcade ® (bortezomib) in Acute Myeloid Leukemia (“AML”), metastatic Castration-Resistant Prostate Cancer (“mCRPC”) and other hematologic and solid tumor cancers. PCM-075 was developed to have high selectivity to PLK1, to be administered orally, and to have a relatively short drug half-life of approximately 24 hours compared to other PLK inhibitors. PCM-075 has completed a safety study in patients with advanced metastatic solid tumors, has a phase 1b/2 clinical trial in patients with AML underway, and a Phase 2 clinical trial in mCRPC planned. Going Concern Uncertainty Trovagene’s consolidated financial statements as of December 31, 2017 have been prepared under the assumption that Trovagene will continue as a going concern, which assumes that the Company will realize its assets and satisfy its liabilities in the normal course of business. The accompanying financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result from the outcome of the uncertainty concerning the Company’s ability to continue as a going concern. The Company has incurred net losses since its inception and has negative operating cash flows. Considering the Company’s current cash resources, including the net proceeds received from the offerings of its equity securities in July and December 2017, management believes the Company’s existing resources will be sufficient to fund the Company’s planned operations through June 2018. The Company also received a default letter from Silicon Valley Bank (“SVB”) regarding the Loan and Security Agreement entered in November 2015 which stated that events of default had occurred and SVB will decide in its sole discretion whether or not to exercise rights and remedies. Based on its current business plan and assumptions, the Company expects to continue to incur significant losses and require significant additional capital to further advance its clinical trial programs and support its other operations. The Company has based its cash sufficiency estimates on its current business plan and its assumptions that may prove to be wrong. The Company could utilize its available capital resources sooner than it currently expects, and it could need additional funding to sustain its operations even sooner than currently anticipated. These circumstances raise substantial doubt about the Company’s ability to continue as a going concern. For the foreseeable future, the Company’s ability to continue its operations is dependent upon its ability to obtain additional capital. The Company cannot be certain that additional funding will be available on acceptable terms, or at all. To the extent that the Company can raise additional funds by issuing equity securities, the Company’s stockholders may experience significant dilution. Any debt financing, if available, may involve restrictive covenants that impact the Company’s ability to conduct its business. If the Company is unable to raise additional capital when required or on acceptable terms, it may have to significantly delay, scale back or discontinue the development and/or commercialization of one or more of its product candidates, all of which would have a material adverse impact on the Company’s operations. The Company may also be required to: • Seek collaborators for product candidates at an earlier stage than otherwise would be desirable and on terms that are less favorable than might otherwise be available; and • Relinquish licenses or otherwise dispose of rights to technologies, product candidates or products that the Company would otherwise seek to develop or commercialize themselves, on unfavorable terms. The Company is evaluating the following options to both raise additional capital as well as reduce costs, in an effort to strengthen its liquidity position: • Raising capital through public and private equity offerings; • Adding capital through short-term and long-term borrowings; • Introducing operation and business development initiatives to bring in new revenue streams; • Reducing operating costs by identifying internal synergies; • Engaging in strategic partnerships; and • Taking actions to reduce or delay capital expenditures. As of February 20, 2018, the Company has received approximately $452,000 upon exercise of 1,814,167 warrants in connection with the December 2017 public offering. The Company continually assesses its spending plans to effectively and efficiently address its liquidity needs. |
Basis of Presentation and Summa
Basis of Presentation and Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Summary of Significant Accounting Policies | Basis of Presentation and Summary of Significant Accounting Policies The accompanying consolidated financial statements of Trovagene, which include its wholly owned subsidiary, Trovagene S.r.l., have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). All intercompany balances and transactions have been eliminated. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Cash and Cash Equivalents Cash and cash equivalents consist of operating and money market accounts as of December 31, 2017 and operating, money market accounts and commercial paper as of December 31, 2016 on deposit. Cash equivalents are considered by the Company to be highly liquid investments purchased with original maturities of three months or less from the date of purchase. Short-Term Investments Short-term investments consist of corporate debt securities, U.S. treasury securities, and commercial paper. The Company classifies its short-term investments as available-for-sale, as the sale of such securities may be required prior to maturity to execute management strategies. Investments classified as available-for-sale are carried at fair value, with the unrealized gains and losses reported as a component of consolidated accumulated other comprehensive income (loss) in stockholders’ equity until realized. Realized gains and losses from the sale of available-for-sale securities, if any, are determined on a specific identification basis. A decline in the market value of any available-for-sale security below cost that is determined to be other than temporary will result in an impairment charge to earnings and a new cost basis for the security is established. No such impairment charges were recorded for any period presented. Premiums and discounts are amortized or accreted over the life of the related security as an adjustment to yield using the straight-line method and included in interest income. Interest income is recognized when earned. Realized gains and losses on investments in securities were included in other income (loss) within the consolidated statements of operations. As of December 31, 2017 , all of the short-term investments have been sold to satisfy the Company’s outstanding obligations under the Loan and Security Agreement dated as of June 30, 2014 upon demanding repayment by the lenders. As a result, the Company recognized net realized loss of approximately $6,400 for the year ended December 31, 2017 . Concentration of Credit Risk Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash and cash equivalents and short-term investments. The Company maintains deposit accounts at financial institutions that are in excess of federally insured limits. The Company has not experienced any losses in such accounts and believes it is not exposed to significant risk on its cash due to the financial position of the depository institution in which those deposits are held. We limit our exposure to credit loss by generally placing our cash and short-term investments in high credit quality financial institutions and investment in fixed income instruments denominated and payable in U.S. dollars. Additionally, we have established guidelines regarding diversification of our investments and their maturities, which are designed to maintain principal and maximize liquidity. Revenues Revenue is recognized when persuasive evidence that an arrangement exists, delivery has occurred, the price is fixed or determinable, and collection is reasonably assured. Royalty and License Revenues The Company licenses and sublicenses its patent rights to healthcare companies, medical laboratories and biotechnology partners. These agreements may involve multiple elements such as license fees, royalties and milestone payments. Revenue is recognized when the criteria described above have been met as well as the following: • Up-front nonrefundable license fees pursuant to agreements under which the Company has no continuing performance obligations are recognized as revenues on the effective date of the agreement and when collection is reasonably assured. • Minimum royalties are recognized as earned, and royalties are earned based on the licensee’s use. The Company is unable to predict licensee’s sales and thus revenue is recognized upon receipt of notification from licensee and payment when collection is assured. Notification is generally one quarter in arrears. Diagnostic Service Revenues Revenue for clinical laboratory tests may come from several sources, including commercial third-party payors, such as insurance companies and health maintenance organizations, government payors, such as Medicare and Medicaid in the United States, patient self-pay and, in some cases, from hospitals or referring laboratories who, in turn, might bill third-party payors for testing. The Company is recognizing diagnostic service revenue on the cash collection basis until such time as it is able to properly estimate collections on third party reimbursements. Clinical Research Services Revenue Revenue from clinical research services consists primarily of revenue from the sale of urine and blood collection supplies under agreements with our clinical research and business development partners. Revenue is recognized when supplies are delivered. Allowance for Doubtful Accounts The Company reviews the collectability of accounts receivable based on an assessment of historic experience, current economic conditions, and other collection indicators. At December 31, 2017 and 2016 the Company had not recorded an allowance for doubtful accounts. When accounts are determined to be uncollectible, they are written off against the reserve balance and the reserve is reassessed. When payments are received on reserved accounts, they are applied to the individual’s account and the reserve is reassessed. Derivative Financial Instruments—Warrants The Company has issued common stock warrants in connection with the execution of certain equity financings. Such warrants are classified as derivative liabilities under the provisions of Financial Accounting Standards Board (“FASB”) ASC 815 Derivatives and Hedging (“ASC 815”) or ASC 480 Distinguishing Liabilities from Equity (“ASC 480”) are recorded at their fair market value as of each reporting period. Such warrants do not meet the exemption that a contract should not be considered a derivative instrument if it is (1) indexed to its own stock and (2) classified in stockholders’ equity. The warrants within the scope of ASC 480 contain a feature that could require the transfer of cash in the event a change of control occurs without an authorization of our Board of Directors, and therefore classified as a liability. Changes in fair value of derivative liabilities are recorded in the consolidated statement of operations under the caption “Change in fair value of derivative instruments.” The fair value of warrants is determined using the Black-Scholes option-pricing model using assumptions regarding the volatility of Trovagene’s common stock price, the remaining life of the warrants, and the risk-free interest rates at each period end. The Company thus uses model-derived valuations where inputs are observable in active markets to determine the fair value and accordingly classifies such warrants in Level 3 per FASB ASC Topic 820, Fair Value Measurements (“ASC 820”). At December 31, 2017 and 2016 , the fair value of these warrants was $649,387 and $834,940 , respectively, and was recorded as a liability under the caption “derivative financial instruments — warrants” on the consolidated balance sheets. Stock-Based Compensation FASB ASC Topic 718 “ Compensation—Stock Compensation ” (“ASC 718”) requires companies to measure the cost of employee services received in exchange for the award of equity instruments based on the estimated fair value of the award at the date of grant. The expense is recognized ratably over the period during which an employee is required to provide services in exchange for the award. ASC 718 did not change the way Trovagene accounts for non-employee stock-based compensation. Trovagene continues to account for shares of common stock, stock options and warrants issued to non-employees based on the fair value of the stock, stock option or warrant, if that value is more reliably measurable than the fair value of the consideration or services received. The Company accounts for stock options issued and vesting to non-employees in accordance with FASB ASC Topic 505-50 “ Equity-Based Payment to Non-Employees ” , and, accordingly, the value of the stock compensation to non-employees is based upon the measurement date as determined at either (1) the date at which a performance commitment is reached, or (2) the date at which the necessary performance to earn the equity instruments is complete. Therefore, the fair value of these options is being “marked to market” quarterly until the measurement date is determined. Fair Value of Financial Instruments Financial instruments consist of cash and cash equivalents, short-term investments, accounts receivable, accounts payable, debt and derivative liabilities. The Company has adopted ASC 820 for financial assets and liabilities that are required to be measured at fair value and non-financial assets and liabilities that are not required to be measured at fair value on a recurring basis. These financial instruments are stated at their respective historical carrying amounts, which approximate fair value due to their short term nature as they reflect current market interest rates. Debt is stated at its respective historical carrying amounts, which approximate fair value as they reflect current market interest rates. In accordance with FASB ASC Subtopic 820-10, the Company measures certain assets and liabilities at fair value on a recurring basis using the three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. The three tiers include: • Level 1 — Quoted prices for identical instruments in active markets. • Level 2 — Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations where inputs are observable or where significant value drivers are observable. • Level 3 — Instruments where significant value drivers are unobservable to third parties. Long-Lived Assets Long-lived assets consist of property and equipment and finite-lived intangible assets. The Company records property and equipment at cost, and records other intangible assets based on their fair values at the date of acquisition. Depreciation on property and equipment is calculated using the straight-line method over the estimate useful life of five years for laboratory equipment and three to five years for furniture and office equipment. Amortization of leasehold improvements is computed based on the shorter of the life of the asset or the term of the lease. Amortization of intangible assets is calculated using the straight line method over the estimate useful life of the assets, based on when the Company expect to receive cash inflows generated by the intangible assets. Impairment losses on long-lived assets used in operations are recorded when indicators of impairment are present and the undiscounted cash flows estimated to be generated by those assets are less than the assets carrying amount. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the estimated fair value of the assets. During the year ended December 31, 2017 , the Company recorded $104,700 of impairment loss on long-lived intangible assets. No impairment losses were recorded on long-lived assets to be held and used during the year ended December 31, 2016 . Restructuring Restructuring costs are included in loss from operations in the consolidated statements of operations. The Company has accounted for these costs in accordance with ASC Topic 420, Exit or Disposal Cost Obligations . One-time termination benefits are recorded at the time they are communicated to the affected employees. In March 2017, the Company announced a restructuring plan which was completed as of December 31, 2017. See Note 12 to the consolidated financial statements for further information. Income Taxes Income taxes are determined using the asset and liability approach of accounting for income taxes. Under this approach, deferred taxes represent the future tax consequences expected to occur when the reported amounts of assets and liabilities are recovered or paid. Deferred taxes result from differences between the financial statement and tax bases of Trovagene’s assets and liabilities and are adjusted for changes in tax rates and tax laws when changes are enacted. Valuation allowances are recorded to reduce deferred tax assets when it is more likely than not that a tax benefit will not be realized. The assessment of whether or not a valuation allowance is required often requires significant judgment. Contingencies In the normal course of business, Trovagene is subject to loss contingencies, such as legal proceedings and claims arising out of its business, that cover a wide range of matters, including, among others, government investigations, stockholder lawsuits, product and environmental liability, and tax matters. In accordance with FASB ASC Topic 450, Accounting for Contingencies , Trovagene records such loss contingencies when it is probable that a liability has been incurred and the amount of loss can be reasonably estimated. Trovagene, in accordance with this guidance, does not recognize gain contingencies until realized. Cost of Revenue Cost of revenue represents the cost of materials, personnel costs, costs associated with processing specimens including pathological review, quality control analyses, and delivery charges necessary to render an individualized test result. Costs associated with performing tests are recorded as the tests are processed. However, the revenue on diagnostic services is recognized on a cash collection basis resulting in costs incurred before the collection of related revenue. Research and Development Research and development expenses, which include expenditures in connection with an in-house research and development laboratory, salaries and staff costs, purchased in-process research and development and regulatory and scientific consulting fees, as well as contract research and insurance, are accounted for in accordance with FASB ASC Topic 730-10-55-2, Research and Development. Also, as prescribed by this guidance, patent filing and maintenance expenses are considered legal in nature and therefore classified as general and administrative expense, if any. While certain of the Company’s research and development costs may have future benefits, the Company’s policy of expensing all research and development expenditures is predicated on the fact that Trovagene has no history of successful commercialization of molecular diagnostic products to base any estimate of the number of future periods that would be benefited. FASB ASC Topic 730, Research and Development requires that non-refundable advance payments for goods or services that will be used or rendered for future research and development activities be deferred and capitalized. As the related goods are delivered or the services are performed, or when the goods or services are no longer expected to be provided, the deferred amounts are recognized as an expense. Net Loss Per Share Basic and diluted net loss per share is presented in conformity with FASB ASC Topic 260, Earnings per Share , for all periods presented. In accordance with this guidance, basic and diluted net loss per common share is determined by dividing net loss applicable to common stockholders by the weighted-average common shares outstanding during the period. Preferred dividends are included in income available to common stockholders in the computation of basic and diluted earnings per share. Shares used in calculating diluted net loss per common share exclude as anti-dilutive the following share equivalents: December 31, 2017 2016 Options to purchase Common Stock 4,490,475 5,528,628 Warrants to purchase Common stock 23,555,520 4,538,606 Restricted Stock Units 1,274,302 272,000 Series A Convertible Preferred Stock 63,125 63,125 29,383,422 10,402,359 The following table summarizes the Company’s diluted net loss per share: December 31, 2017 2016 Numerator: Net loss attributable to common stockholders $ (24,930,984 ) $ (39,227,959 ) Adjustment for gain from change in fair value of derivative financial instruments—warrants — (2,321,053 ) Net loss used for diluted loss per share $ (24,930,984 ) $ (41,549,012 ) Denominator: Weighted-average shares used to compute basic net loss per share 34,680,362 30,174,838 Adjustments to reflect assumed exercise of warrants — 106,425 Weighted-average shares used to compute diluted net loss per share 34,680,362 30,281,263 Net loss per share attributable to common stockholders: Basic $ (0.72 ) $ (1.30 ) Diluted $ (0.72 ) $ (1.37 ) Change in Accounting Principle In March 2016, the FASB issued ASU 2016-09, Improvements to Employee Share-Based Payment Accounting (“ASU 2016-09”), which aims to simplify the accounting for share-based payment transactions, including accounting for income taxes, classification on the statement of cash flows, accounting for forfeitures, and classification of awards as either liabilities or equity. In addition, under the ASU 2016-09, excess income tax benefits from share-based compensation arrangements are classified as cash flow from operations, rather than cash flow from financing activities. The Company adopted ASU 2016-09 as of January 1, 2017 and has elected to continue estimating forfeitures based on historical experience. The adoption of ASU 2016-09 had no impact on the Company’s financial statements. Recent Accounting Pronouncements In August 2016, the FASB issued Accounting Standards Update (“ASU”) 2016-15, Classification of Certain Cash Receipts and Cash Payments (“ASU 2016-15”), which includes amendments that clarify how certain cash receipts and cash payments are presented in the statement of cash flows. ASU 2016-15 also provides guidance clarifying when an entity should separate cash receipts and cash payments and classify them into more than one class of cash flows. The new amendments and guidance are effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. Early adoption is permitted provided that all amendments are adopted in the same period. The Company is currently evaluating the impact of adoption of ASU 2016-15 on its consolidated statements of cash flows. In February 2016, the FASB issued ASU 2016-02, Leases . The new standard establishes a right-of-use (“ROU”) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for most leases. The new standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. A modified retrospective transition approach is required for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. The new standard will impact the Company’s accounting for its office leases and the Company is currently evaluating the impact of the new standard on its consolidated financial statements. In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”). The new standard is based on the principle that revenue should be recognized to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Since its initial release, the FASB has issued several amendments to the standard, which include clarification of accounting guidance related to identification of performance obligations, intellectual property licenses, and principle versus agent considerations. ASU 2014-09 and all subsequent amendments (collectively, “ASC 606”) became effective for the Company on January 1, 2018 and was adopted the standard using the modified retrospective method. The cumulative effect of applying the new standard is immaterial and we will recognize the amount in retained earnings on the date of initial application. Under ASC 606, the Company will accrue for royalties as earned and no longer record them on a lag. The Company has reviewed its revenue streams to identify potential differences in accounting under the new revenue recognition standard. The Company’s timing and measurement of revenue recognition will not be materially affected by the adoption and implementation of ASC 606. Currently, the Company does not have any significant contracts with customers given its stage of development. The Company has derived its revenues primarily from a limited number of royalty, license and diagnostic service agreements. The consideration the Company is eligible to receive under these agreements includes upfront license payments, milestone payments and royalties. Each of these agreements has unique terms that have been evaluated separately under the new standards. The new standards differ from the current accounting standard in many respects, such as in the accounting for variable consideration, including milestone payments. For example, the Company currently recognizes milestone revenue using the milestone method specified in ASC 605-28, which generally results in recognition of milestone revenue in the period that the milestone event is achieved. However, under the new standards, it is possible to start to recognize milestone revenue before the milestone is achieved if management determines with a high degree of certainty that amounts recorded as revenues will not have to be reversed when the uncertainty associated with the variable consideration is subsequently resolved. The Company has assessed the potential impact that the new standards may have with respect to its diagnostic service revenue and has determined to recognize its diagnostic service revenue on a cash collection basis as it does currently. The Company has completed its full assessment of the impact the new standards will have on its financial statements before the year-end 2017. The assessment concludes the Company will not have a significant change in the timing and measurement of its revenue upon adoption of the new standards. The Company will adopt the new standards effective January 1, 2018 using the modified retrospective transition method. The Company’s current assessment identifies a highly immaterial adjustment to beginning retained earnings for the cumulative effect of the change. |
Supplementary Balance Sheet Inf
Supplementary Balance Sheet Information | 12 Months Ended |
Dec. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Supplementary Balance Sheet Information | Supplementary Balance Sheet Information Short-term Investments As of December 31, 2017 , all short-term investments have been sold to satisfy the Company’s outstanding obligations under the Loan and Security Agreement dated as of June 30, 2014 upon demanding repayment by the lenders. The following table sets forth the composition of short-term investments as of December 31, 2016 . Unrealized Maturity in Years Cost Gains Losses Fair Value Corporate debt securities Less than 1 year $ 14,165,915 $ 44 $ (5,273 ) $ 14,160,686 Commercial paper Less than 1 year 1,195,444 — — 1,195,444 U.S. treasury securities Less than 1 year 8,625,728 330 (4,166 ) 8,621,892 Total investment $ 23,987,087 $ 374 $ (9,439 ) $ 23,978,022 Property and Equipment Fixed assets consist of laboratory, testing and computer equipment and fixtures stated at cost. Depreciation and amortization expense for property and equipment for the years ended December 31, 2017 and 2016 was $1,053,913 and $969,833 , respectively. Property and equipment consisted of the following: As of December 31, 2017 2016 Furniture and office equipment $ 1,076,709 $ 1,144,741 Leasehold improvements 1,994,514 1,994,514 Laboratory equipment 1,426,581 2,449,645 4,497,804 5,588,900 Less—accumulated depreciation and amortization (2,071,492 ) (1,761,985 ) Property and equipment, net $ 2,426,312 $ 3,826,915 Accrued Liabilities Accrued liabilities consisted of the following: As of December 31, 2017 2016 Accrued compensation $ 618,128 $ 2,203,876 Accrued research agreements 135,139 736,199 Accrued professional fees — 421,314 Other accrued liabilities 701,320 659,976 Total accrued liabilities $ 1,454,587 $ 4,021,365 |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2017 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity | Stockholders’ Equity Common Stock During the year ended December 31, 2016 , the Company issued a total of 959,190 shares of common stock. The Company received gross proceeds of approximately $2.4 million from the sale of 421,810 shares of its common stock at a weighted-average price of $5.61 under the agreement with the Agent. In addition, 98,396 shares were issued upon exercise of options for a weighted-average price of $3.73 , 341,333 shares were issued upon net exercise of 1,236,875 options at a weighted average exercise price of $3.81 , 2,651 shares were issued upon net exercise of 8,333 warrants at a weighted-average exercise price of $3.00 , and 95,000 shares were issued upon vesting of restricted stock units. During the year ended December 31, 2017 , the Company issued a total of 22,094,793 shares of common stock. The Company received gross proceeds of approximately $11.6 million from the sale of 20,874,833 shares of its common stock and 19,960,293 share of warrants and pre-funded warrants through public offering, registered direct offering and private placement in July and December 2017. The Company received gross proceeds of approximately $0.1 million from the sale of 102,081 shares of its common stock at a weighted-average price of $1.08 under the agreement with the Agent. In addition, 372,487 shares were issued upon vesting of restricted stock units (“RSU”), and 745,392 shares were issued upon vesting of restricted stock awards (“RSA”). Warrants A summary of warrant activity and changes in warrants outstanding, including both liability and equity classifications, is presented below: Number of Warrants (1) Weighted-Average Exercise Price Per Share (1) Weighted-Average Remaining Contractual Term (1) Balance outstanding, December 31, 2015 5,533,242 $ 3.86 2.5 Granted 30,992 $ 4.84 Exercised (8,333 ) $ 3.00 Expired (50,000 ) $ 8.00 Balance outstanding, December 31, 2016 5,505,901 $ 3.83 1.6 Granted 19,643,626 $ 0.56 Expired (1,910,674 ) $ 5.32 Balance outstanding, December 31, 2017 23,238,853 $ 0.95 4.4 (1) Excluded the pre-funded warrants to purchase 316,667 shares of common stock at a nominal exercise price of $0.01 per share. The pre-warrants expire when exercised in full. The Company issued warrants to purchase 30,992 shares of common stock at an exercise price of $4.84 per share during the year ended December 31, 2016. The warrants were issued in connection with the fifth amendment to the $15.0 million debt agreement. The estimated fair value of the warrants was determined on the date of grant using the Black-Scholes option valuation model using the following assumptions: a risk-free interest rate of 1.59% , dividend yield of 0% , expected volatility of 130.66% and expected term of ten years . The resulting fair value of $148,885 was recorded as a debt discount and was amortized to interest expense over the new term of the loan using the effective interest method. In June 2017, Company received a Notice of Event of Default from the lenders which stated that Events of Default had occurred and all of the obligation under the Agreement were immediately due and payable. Upon termination of the Agreement, unamortized debt discount was recorded as loss on debt extinguishment. In connection with a direct registered offering occurred in July 2017, the Company issued warrants to purchase 4,643,626 shares of common stock at an exercise price of $1.41 per share which expire on the five years anniversary of the original issuance date. In December 2017, the Company issued warrants to purchase 15,000,000 shares of common stock at an exercise price of $0.30 per share in a public offering which expire on the five years anniversary of the original issuance date. The Company also issued pre-funded warrants to purchase 316,667 shares of common stock which expire when exercised in full. $0.29 of the pre-funded warrant exercise price was paid upfront on the closing date of the public offering and the remaining exercise price is $0.01 . Series A Convertible Preferred Stock The material terms of the Series A Convertible Preferred Stock consist of: 1) Dividends. Holders of the Company’s Series A Convertible Preferred Stock are entitled to receive cumulative dividends at the rate per share of 4% per annum, payable quarterly on March 31, June 30, September 30 and December 31, beginning with September 30, 2005. Dividends are payable, at the Company’s sole election, in cash or shares of common stock. As of December 31, 2017 and 2016 , the Company had $316,775 and $292,535 , respectively in accrued cumulative unpaid preferred stock dividends, included in accrued liabilities in the Company’s consolidated balance sheets, and $24,240 and $24,240 of accrued dividends was recorded during the years ended December 31, 2017 and 2016 , respectively. 2) Voting Rights. Shares of the Series A Convertible Preferred Stock have no voting rights. However, so long as any shares of Series A Convertible Preferred Stock are outstanding, the Company may not, without the affirmative vote of the holders of the shares of Series A Convertible Preferred Stock then outstanding, (a) adversely change the powers, preferences or rights given to the Series A Convertible Preferred Stock, (b) authorize or create any class of stock senior or equal to the Series A Convertible Preferred Stock, (c) amend its certificate of incorporation or other charter documents, so as to affect adversely any rights of the holders of Series A Convertible Preferred Stock or (d) increase the authorized number of shares of Series A Convertible Preferred Stock. 3) Liquidation. Upon any liquidation, dissolution or winding-up of the Company, the holders of the Series A Convertible Preferred Stock are entitled to receive an amount equal to the Stated Value per share, which is currently $10 per share plus any accrued and unpaid dividends. 4) Conversion Rights. Each share of Series A Convertible Preferred Stock is convertible at the option of the holder into that number of shares of common stock determined by dividing the Stated Value, currently $10 per share, by the conversion price, originally $2.15 per share. 5) Subsequent Equity Sales. The conversion price is subject to adjustment for dilutive issuances for a period of 12 months beginning upon registration of the common stock underlying the Series A Convertible Preferred Stock. The relevant registration statement became effective on March 17, 2006 and during the following twelve month period the conversion price was adjusted to $9.60 per share. 6) Automatic Conversion. If the price of the Company’s common stock equals $25.80 per share for 20 consecutive trading days, and an average of 8,333 shares of common stock per day are traded during the 20 trading days, the Company will have the right to deliver a notice to the holders of the Series A Convertible Preferred Stock, requesting the holders to convert any portion of the shares of Series A Convertible Preferred Stock into shares of common stock at the applicable conversion price. As of the date of these financial statements, such conditions have not been met. As of each of December 31, 2017 and 2016 , there were 60,600 shares of Series A Convertible Preferred Stock outstanding. |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation The Trovagene, Inc. 2014 Equity Incentive Plan (the “2014 EIP’), authorizing up to 2,500,000 shares of common stock for issuance under the 2014 EIP, was approved by the Board in June 2014 and approved by the stockholders of the Company at the September 17, 2014 Annual Meeting of Stockholders. An additional 2,500,000 shares of common stock was authorized for issuance by the Board in March 2015 and was approved by the stockholders at the June 10, 2015 Annual Meeting of Stockholders. Stockholder approval was obtained on May 17, 2016 to increase the number of authorized shares in the 2014 EIP from 5,000,000 to 7,500,000 . The adoption of an amendment to the Company’s 2014 EIP to increase the number of shares of common stock reserved for issuance to 9,500,000 was approved by the stockholders at the June 13, 2017 Annual Meeting of Stockholders. As of December 31, 2017 , there were 3,436,788 shares available for issuance under the 2014 EIP. Stock-based compensation has been recognized in operating results as follows: Years ended December 31, 2017 2016 In cost of revenue $ 83,713 $ 122,301 In research and development expenses 1,026,497 2,420,696 In selling and marketing expense 676,635 2,111,366 In general and administrative expenses 2,350,962 2,910,156 Benefit from restructuring (125,222 ) (60,203 ) Total stock-based compensation $ 4,012,585 $ 7,504,316 Stock Options The estimated fair value of stock option awards was determined on the date of grant using the Black-Scholes option valuation model with the following assumptions during the years indicated below: Years ended December 31, 2017 2016 Risk-free interest rate 1.82% - 2.03% 0.93% - 1.89% Dividend yield 0% 0% Expected volatility (range) 86% - 117% 80% - 134% Expected volatility (weighted-average) 87% 103% Expected term (in years) 5.3 years 5.5 years Risk-free interest rate — Based on the daily yield curve rates for U.S. Treasury obligations with maturities that correspond to the expected term of the Company’s stock options. Dividend yield — Trovagene has not paid any dividends on common stock since its inception and does not anticipate paying dividends on its common stock in the foreseeable future. Expected volatility — Based on the historical volatility of Trovagene’s common stock. Expected term — The expected option term represents the period that stock-based awards are expected to be outstanding based on the simplified method provided in Staff Accounting Bulletin (“SAB”) No. 107, Share-Based Payment (“SAB No. 107”), which averages an award’s weighted-average vesting period and expected term for “plain vanilla” share options. Under SAB No. 107, options are considered to be “plain vanilla” if they have the following basic characteristics: (1) are granted “at-the-money”; (2) exercisability is conditioned upon service through the vesting date; (3) termination of service prior to vesting results in forfeiture; (4) limited exercise period following termination of service; and (5) are non-transferable and non-hedgeable. Forfeitures — FASB ASC Topic 718 (“ASC 718”) required forfeitures to be estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. FASB ASU 2016-09 allows the Company to make an entity-wide accounting policy election to either estimate the number of awards that are expected to vest or account for forfeitures when they occur. The Company elected to estimate forfeitures based on its historical experience. The weighted-average fair value per share of all options granted during the years ended December 31, 2017 and 2016 , estimated as of the grant date using the Black-Scholes option valuation model, was $0.56 and $3.60 per share, respectively. The unrecognized compensation cost related to non-vested stock options outstanding at December 31, 2017 and 2016 was $2,915,970 and $8,211,896 , respectively. The weighted-average remaining amortization period at December 31, 2017 and 2016 for non-vested stock options was 2.0 years and 2.8 years , respectively. The total intrinsic value of stock options exercised was $0 and $1,932,799 during the years ended December 31, 2017 and 2016 , respectively. The total fair value of shares vested during the years ended December 31, 2017 and 2016 was $3,992,127 and $6,261,655 , respectively. A summary of stock option activity and of changes in stock options outstanding is presented below: Number of Options Weighted-Average Exercise Price Per Share Intrinsic Value Weighted-Average Remaining Contractual Life Balance outstanding, December 31, 2015 6,948,630 $ 5.45 $ 5,903,466 7.8 years Granted 3,246,250 $ 5.02 Exercised (1,335,271 ) $ 3.81 Forfeited (3,330,981 ) $ 5.63 Balance outstanding, December 31, 2016 5,528,628 $ 5.49 $ — 7.7 years Granted 1,059,242 $ 0.82 Forfeited (2,079,938 ) $ 6.24 Expired (17,457 ) $ 4.74 Balance outstanding, December 31, 2017 4,490,475 $ 4.04 $ — 7.1 years Vested and exercisable, December 31, 2017 2,745,350 $ 4.66 $ — 6.0 years Upon adoption of ASU 2016-09, the cash flows resulting from tax deductions in excess of the cumulative compensation cost recognized for options exercised (excess tax benefits) are classified within operating activities in the statement of cash flows. Due to Trovagene’s accumulated deficit position, no tax benefits have been recognized in the cash flow statement. Restricted Stock Units Under guidance provided by ASC Topic 718 “Compensation—Stock Compensation” for share-based payments, stock-based compensation cost for RSU is measured at the grant date based on the closing market price of the Company’s common stock at the grant date and recognized ratably over the service period through the vesting date. All RSU were granted with no purchase price. Vesting of the RSU is generally subject to service conditions. A summary of the RSU activity is presented below: Number of Shares Weighted Average Grant Date Fair Value Per Share Intrinsic Non-vested RSU outstanding, December 31, 2015 — $ — $ — Granted 402,000 $ 4.06 Vested (95,000 ) $ 4.27 Forfeited (35,000 ) $ 3.99 Non-vested RSU outstanding, December 31, 2016 272,000 $ 3.99 $ 571,200 Granted 2,249,242 $ 1.59 Vested (372,487 ) $ 3.47 Forfeited (874,453 ) $ 1.75 Non-vested RSU outstanding, December 31, 2017 1,274,302 $ 1.43 $ 391,848 At December 31, 2017 and 2016 , total unrecognized compensation costs related to non-vested RSU were $689,365 and $4,430 , which are expected to be recognized over 2.9 years and one day , respectively. The total intrinsic values of RSU vested was $647,885 and $293,781 during the year ended December 31, 2017 and 2016 , respectively. The total fair values of RSU vested during the year ended December 31, 2017 and 2016 were $1,291,878 and $405,550 , respectively. Restricted Stock Awards During the year ended December 31, 2017 , a total of 745,392 shares of RSA were granted, all of which were vested immediately. The total fair value of vested RSA during the year ended December 31, 2017 was $596,314 . The weighted-average grant date fair value of the RSA was $0.80 per share during the year ended December 31, 2017 . There were no such awards granted during the year ended December 31, 2016 . |
Derivative Financial Instrument
Derivative Financial Instruments - Warrants | 12 Months Ended |
Dec. 31, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments - Warrants | Derivative Financial Instruments — Warrants Based upon the Company’s analysis of the criteria contained in ASC Topic 815-40, Contracts in Entity’s Own Equity (“ASC 815-40”) or ASC Topic 480-10, Distinguishing Liabilities from Equity (“ASC 480-10”), Trovagene determined that certain warrants issued in connection with the execution of certain equity financings must be recorded as derivative liabilities. In accordance with ASC 815-40 and ASC 480-10, the warrants are also being re-measured at each balance sheet date based on estimated fair value, and any resultant change in fair value is being recorded in the Company’s consolidated statements of operations. The Company estimates the fair value of these warrants using the Black-Scholes option pricing model. The range of assumptions used to determine the fair value of the warrants valued using the Black-Scholes option pricing model during the periods indicated was: Year ended December 31 2017 2016 Estimated fair value of Trovagene common stock $0.31 - $1.26 $2.10 - $4.65 Expected warrant term 1.0 - 5.5 years 2.0 - 2.8 years Risk-free interest rate 1.27% - 2.21% 0.71% - 1.20% Expected volatility 86% - 116% 82% - 94% Dividend yield —% —% Expected volatility is based on the historical volatility of Trovagene’s common stock. The warrants have a transferability provision and based on guidance provided in SAB No. 107 for instruments issued with such a provision, Trovagene used the full contractual term as the expected term of the warrants. The risk-free interest rate is based on the U.S. Treasury security rates consistent with the expected remaining term of the warrants at each balance sheet date. The following table sets forth the components of changes in the Company’s derivative financial instruments — warrants liability balance, valued using the Black-Scholes option pricing method, for the periods indicated. Date Description Number of Warrants Derivative Instrument Liability December 31, 2015 Balance of derivative financial instruments — warrants liability 967,295 $ 3,297,077 Change in fair value of derivative financial instruments — warrants during the year recognized as a gain in the statement of operations — (2,462,137 ) December 31, 2016 Balance of derivative financial instruments — warrants liability 967,295 834,940 Issuance of Derivative Financial Instruments 4,643,626 3,215,519 Change in fair value of derivative financial instruments — warrants during the year recognized as a gain in the statement of operations — (3,401,072 ) December 31, 2017 Balance of derivative financial instruments — warrants liability 5,610,921 $ 649,387 The remaining contractual term of these warrants outstanding at December 31, 2017 and 2016 was approximately 4.4 and 2.0 years, respectively. At December 31, 2017 and 2016 , the total fair value of the above warrants accounted for as derivative financial instruments — warrants, valued using the Black-Scholes option pricing model, was $649,387 and $834,940 , respectively, and is classified as derivative financial instruments — warrants liability on the balance sheet. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The following table presents the Company’s assets and liabilities that are measured and recognized at fair value on a recurring basis classified under the appropriate level of the fair value hierarchy as of December 31, 2017 and 2016 : Fair Value Measurements at Quoted Prices in Active Markets for Identical Assets and Liabilities Significant Other Observable Inputs Significant Unobservable Inputs Total Assets: Money market fund (1) $ 4,522,631 $ — $ — $ 4,522,631 Total Assets $ 4,522,631 $ — $ — $ 4,522,631 Liabilities: Derivative financial instruments — warrants $ — $ — $ 649,387 $ 649,387 Total Liabilities $ — $ — $ 649,387 $ 649,387 Fair Value Measurements at Quoted Prices in Active Markets for Identical Assets and Liabilities Significant Other Observable Inputs Significant Unobservable Inputs Total Assets: Money market fund (1) $ 12,095,620 $ — $ — $ 12,095,620 Corporate debt securities (2) — 14,160,686 — 14,160,686 Commercial paper (3) — 2,393,948 — 2,393,948 U.S. treasury securities (2) — 8,621,892 — 8,621,892 Total Assets $ 12,095,620 $ 25,176,526 $ — $ 37,272,146 Liabilities: Derivative financial instruments — warrants $ — $ — $ 834,940 $ 834,940 Total Liabilities $ — $ — $ 834,940 $ 834,940 (1) Included as a component of cash and cash equivalents on the accompanying consolidated balance sheet. (2) Included in short-term investments on the accompanying consolidated balance sheet. (3) $1,198,504 of commercial paper was included as a component of cash and cash equivalents, and the rest of amount was included in short-term investments on the accompanying consolidated balance sheet. The following table sets forth a summary of changes in the fair value of the Company’s Level 3 liabilities for the years ended December 31, 2017 and 2016 : Description Balance at Issuance of Derivative Financial Instruments Unrealized (gains) or losses Balance at Derivative financial instruments — Warrants $ 834,940 $ 3,215,519 $ (3,401,072 ) $ 649,387 Description Balance at Unrealized (gains) or losses Balance at Derivative financial instruments — Warrants $ 3,297,077 $ (2,462,137 ) $ 834,940 The unrealized gains or losses on the derivative financial instruments—warrants are recorded as a change in fair value of derivative financial instruments—warrants in the Company’s consolidated statement of operations. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. At each reporting period, the Company reviews the assets and liabilities that are subject to ASC Topic 815-40. At each reporting period, all assets and liabilities for which the fair value measurement is based on significant unobservable inputs or instruments that trade infrequently and therefore have little or no price transparency are classified as Level 3. |
Debt
Debt | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Debt | Debt Equipment Line of Credit In November 2015, the Company entered into a Loan and Security Agreement (“Equipment Line of Credit”) with Silicon Valley Bank that provided for cash borrowings for equipment (“Equipment Advances”) of up to $2.0 million , secured by the equipment financed. Under the terms of the agreement, interest is equal to 1.25% above the Prime Rate. At December 31, 2017 , the interest rate was 5.75% . Interest only payments are due on borrowings through November 30, 2016, with both interest and principal payments commencing in December 2016. Any equipment advances after November 30, 2016 are subject to principal and interest payments immediately over a 36 -month period following the advance. All unpaid principal and interest on each Equipment Advance will be due on November 1, 2019. The Company has an obligation to make a final payment equal to 7% of total amounts borrowed at the loan maturity date. On June 20, 2017, the Company received a Notice of Event of Default (“Default Letter”) from SVB which stated that Events of Default had occurred and SVB will decide in its sole discretion whether or not to exercise rights and remedies. Pursuant to the Default Letter, the Company has classified the entire balance of $1,331,515 as a current liability as of December 31, 2017 and also started recording accrued interest at a default rate. The Company recorded $232,765 in interest expense related to the Equipment Line of Credit during the year ended December 31, 2017 . The Company is currently working with lender for resolution. Loan and Security Agreement In June 2014, the Company entered into a $15,000,000 loan and security agreement (“Agreement”) with two banks pursuant to which the lenders provided the Company with a term loan, which was funded at closing. In connection with the loan, each of the lenders received a warrant to purchase up to an aggregate of 85,470 shares of the Company’s common stock at an exercise price of $3.51 per share, which such warrants are exercisable for ten years from the date of issuance. On July 20, 2016, the Company signed the 5th Amendment to Loan and Security Agreement (“Amendment”) to refinance its existing term loan. Under the Amendment, the interest rate was adjusted to 3.75% plus the Wall Street Journal Prime Rate (subject to a floor of 7.25% ). The Company is required to make interest only payments on the outstanding amount of the loan on a monthly basis through September 1, 2017, after which equal monthly payments of principal and interest are due until the loan maturity date of February 1, 2020. In addition, the lenders received a warrant to purchase an aggregate 30,992 shares of the Company’s common stock at an exercise price of $4.84 per share exercisable for ten years from the date of issuance. As of December 31, 2017 , warrants to purchase 73,727 shares of common stock remains outstanding, of which 42,735 of these warrants were in connection with the original Agreement. On June 1, 2017, the Company received a Notice of Event of Default from the lenders which stated that Events of Default had occurred and all of the obligation under the Agreement were immediately due and payable. On June 6, 2017, the lenders took the total pay-off amount of $16,668,583 for the principal, interest, final payment, and other amounts out of the Company’s bank accounts which satisfied all of the Company’s outstanding obligations under the Agreement. Accordingly, the Agreement was terminated in June 2017. Upon termination of the Agreement, the prepayment fee of $450,000 , unamortized debt discount of $400,562 and unamortized final fee of $738,196 were recorded as loss on debt extinguishment. The Company recorded total interest expense of $801,173 related to the Agreement during the year ended December 31, 2017 . |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes At December 31, 2017 , Trovagene had federal net operating loss carryforwards (NOLs) of approximately $130.5 million , which, if not used, expire beginning in 2020. Trovagene also has California NOLs of approximately $72.1 million that will begin to expire in 2029. Trovagene also has research and development tax credits available for federal and California purposes of approximately $2.0 million and $1.1 million , respectively. The federal research and development tax credits will begin to expire on January 31, 2025. The California research and development tax credits are not set to expire. The utilization of these NOLs and research and development tax credits is subject to limitations based on past and future changes in ownership of Trovagene pursuant to Section 382 (“Section 382”) of the Internal Revenue Code of 1986, as amended (the “Code”). The Company has determined that ownership changes have occurred for purposes of Section 382 and, therefore, the ability of the Company to utilize its NOLs is limited. The provision for income taxes based on losses from continuing operations consists of the following at December 31 (in thousands): Years ended December 31, 2017 2016 Current: State $ 1 $ — Total current provision 1 — Deferred: Federal 9,781 (14,035 ) State 3,171 (2,443 ) Foreign — (114 ) Total deferred expense (benefit) 12,952 (16,592 ) Valuation allowance (12,953 ) 16,592 Total income tax provision $ — $ — Significant components of the Company’s taxes and the rates as of December 31 are shown below (in thousands, except percentages): Years ended December 31, 2017 2016 Tax computed at the federal statutory rate $ (8,591 ) 34 % $ (13,206 ) 34 % State tax, net of federal tax benefit (697 ) 3 % (2,286 ) 6 % Foreign tax — — % (114 ) — % Permanent Items (706 ) 3 % (114 ) — % Tax credits (431 ) 2 % (1,276 ) 3 % Valuation allowance increase (11,029 ) 43 % 16,996 (43 )% Tax rate change 21,454 (85 )% — — % Provision for income taxes $ — — % $ — — % The Tax Cuts and Jobs Act of 2017 (“TCJA”) was signed into law on December 22, 2017. The TCJA significantly revises the U.S. corporate income tax by, among other things, lowering the statutory corporate tax rate from 35% to 21%, eliminating certain deductions, imposing a mandatory one-time tax on accumulated earnings of foreign subsidiaries, introducing new tax regimes, and changing how foreign earnings are subject to U.S. tax. The TCJA also enhanced and extended through 2026 the option to claim accelerated depreciation deductions on qualified property. We have not completed our determination of the accounting implications of the TCJA on our tax accruals. However, we have reasonably estimated the effects of the TCJA and recorded in our financial statements as of December 31, 2017 the provisional amounts for the revaluation of our net deferred tax assets and liabilities resulting from the permanent reduction in the U.S. statutory corporate tax rate to 21% from 35%. The provision estimate results in $19.5 million of tax expense offset by an adjustment to the valuation allowance. As we complete our analysis of the TCJA, collect and prepare necessary data, and interpret any additional guidance issued by the U.S. Treasury Department, the IRS, and other standard-setting bodies, we may make adjustments to the provisional amounts. Those adjustments may materially impact our provision for income taxes in the period in which the adjustments are made. Significant components of the Company’s deferred tax assets and liabilities from federal and state income taxes as of December 31 are shown below (in thousands): Years ended December 31, 2017 2016 Deferred tax assets: Tax loss carryforwards $ 29,713 $ 41,502 Research and development credits and other tax credits 3,084 2,817 Stock-based compensation 3,565 4,658 Other 945 1,283 Total deferred tax assets 37,307 50,260 Valuation allowance (37,307 ) (50,260 ) Net deferred tax asset $ — $ — Trovagene records a valuation allowance against deferred tax assets to the extent that it is more likely than not that some portion, or all of, the deferred tax assets will not be realized. Due to the substantial doubt related to Trovagene’s ability to utilize its deferred tax assets, the Company recorded a valuation allowance against the deferred tax. FASB ASC Topic 740-10-30-7, Accounting for Income Taxes had no effect on Trovagene’s financial position, cash flows or results of operations upon adoption, as Trovagene does not have any unrecognized tax benefits. Trovagene’s practice is to recognize interest and/or penalties related to income tax matters in income tax expense, and none have been incurred to date. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies License and Service Agreements In March 2017, the Company entered into a license agreement with Nerviano which granted the Company development and commercialization rights to NMS-1286937, which Trovagene refers to as PCM-075. PCM-075 is an oral, investigative drug and a highly-selective adenosine triphosphate competitive inhibitor of the serine/threonine PLK 1. The Company plans to develop PCM-075 initially in patients with AML. Upon execution of the agreement, the Company paid $2.0 million in license fees which were expensed to research and development costs during the year ended December 31, 2017 . The Company is committed to pay $1.0 million for future services provided by Nerviano, such as the costs to manufacture drug product, no later than June 30, 2019. Terms of the agreement also provide for the Company to pay royalties based on certain development and sales milestones. The Company is a party to various agreements under which it licenses technology on an exclusive basis in the field of human diagnostics. License fees are generally calculated as a percentage of product revenues, with rates that vary by agreement. To date, payments have not been material. Litigation Trovagene does not believe that the Company has legal liabilities that are probable or reasonably possible that require either accrual or disclosure, except for the following: On March 28, 2016 the Company filed a complaint in the Superior Court of the State of California for the County of San Diego against the Company’s former CEO and CFO, for, among other things, breach of fiduciary duty for failing to present a lucrative corporate opportunity to the Company concerning promising new therapeutics in the field of precision medicine and instead taking that opportunity for their own personal benefit (the “Complaint”). The Complaint asks that these two former executives be required to turn over their interests in these new therapeutics to the Company. The former CEO and CFO filed a cross complaint in the Superior Court of the State of California for the County of San Diego against the Company on May 23, 2016 for, among other things, breach of contract (the “Cross Complaint”, and together with the Complaint, collectively, the “Litigation”). On July 28, 2017, the parties settled the Litigation. The settlement involved mutual releases by all parties involved. The net cost to Trovagene in connection with the settlement is approximately $2.1 million . Of that amount, $975,000 was the net amount paid directly to the former CEO and CFO. From time to time, the Company may become involved in various lawsuits and legal proceedings that arise in the ordinary course of business. Litigation is subject to inherent uncertainties, and an adverse result in matters may arise from time to time that may harm the Company’s business. As of the date of this report, management believes that there are no claims against the Company, which it believes will result in a material adverse effect on the Company’s business or financial condition. Employment Agreements The Company has longer-term contractual commitments with various employees. Certain employment agreements provide for severance payments. Lease Agreements The Company currently leases approximately 26,100 square feet facilities in San Diego under an operating lease that expires on December 31, 2021 at a monthly rental rate of approximately $68,000 . The Company leased certain lab and office space in Torino, Italy, of approximately 2,300 square feet at a monthly rental rate of approximately $3,100 . The lease was terminated at the end of September 2017. Rent expense for the years ended December 31, 2017 and 2016 was approximately $663,000 and $602,000 , respectively. The Company is also a party to various non-cancelable operating lease agreements for office equipment. Total annual commitments under non-cancelable lease agreements for each of the years ended December 31 are as follows: Operating Leases Sublease Income Net Operating Leases 2018 $ 881,815 $ (216,504 ) $ 665,311 2019 906,879 (183,124 ) 723,755 2020 931,457 — 931,457 2021 959,401 — 959,401 2022 — — — Thereafter — — — Total $ 3,679,552 $ (399,628 ) $ 3,279,924 Public Offering and Controlled Equity Offering On March 15, 2017, the Company filed a Form 424B5 to amend and supplement the information in the Company’s registration statement and prospectus, dated June 13, 2016, to offer and sell additional shares of the Company’s common stock having an aggregate offering price up to $20,698,357 . The Company entered into an agreement with Cantor Fitzgerald & Co. (“Agent”) on January 25, 2013 to issue and sell up to $30,000,000 of shares of common stock through the Agent. As payment for its services, the Agent is entitled to a 3% commission on gross proceeds. Gross proceeds of $110,000 have been raised in 2017. Database Usage In March 2016 the Company entered into an agreement with an outside vendor to develop an online database for test requisition and test results. Under the agreement, the Company is obligated to pay a fixed development fee, and a usage fee each time an external user completes and submits a test order form to the database. To date, the Company has paid the fixed development fee. Costs incurred in connection with the usage fees were immaterial. |
Employee Benefit Plan
Employee Benefit Plan | 12 Months Ended |
Dec. 31, 2017 | |
Retirement Benefits [Abstract] | |
Employee Benefit Plan | Employee Benefit Plan The Company has a retirement savings plan under Section 401(k) of the Code covering its employees. The plan allows employees to defer, up to the maximum allowed, a percentage of their income on a pre-tax basis through contributions to the plans, plus any employee age 50 and over can participate in the caught-up dollars as allowed by Internal Revenue Service codes. The Company also has a Roth investment plan that is taken after taxes. The Company does not currently make matching contributions. |
Restructuring Charges
Restructuring Charges | 12 Months Ended |
Dec. 31, 2017 | |
Restructuring and Related Activities [Abstract] | |
Restructuring Charges | Restructuring Charges On March 15, 2017, in connection with the addition of precision medicine therapeutics to its business, the Company announced a restructuring plan (the “Restructuring”) which included a reduction in force. As part of this restructuring, the Company elected to dissolve its wholly owned subsidiary, Trovagene Srl, in 2017, resulting in a reversal of foreign currency translation losses. The financial results of the dissolution is represented in the restructuring cost in the December 31, 2017 financial statements. This restructuring has been completed as of December 31, 2017. The Company incurred approximately $2.2 million in restructuring charges, which has been included as a component of operating loss for the year ended December 31, 2017. Restructuring charges include approximately $1.1 million of costs related to termination of employees, which is net of a $125,000 stock-based compensation expense reversal for certain terminated employees. The remaining restructuring charges of approximately $485,000 were related to impairment of capitalized license fees. Of the total restructuring expenses recorded, approximately $262,000 remains to be paid as of December 31, 2017 and is included in accrued liabilities on the Company’s consolidated balance sheet. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2017 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions In March 2016, the Company engaged Rutan & Tucker, LLP, a law firm to represent Trovagene, Inc. with respect to various lawsuits. One of the partners from Rutan & Tucker, LLP, is the son of the Company’s Chairman of the Board. The fees for legal services are based on the hourly rates of the individuals performing the legal services. During the year ended December 31, 2017 and 2016, the Company incurred and recorded approximately $650,000 and $537,000 of legal expenses, net of insurance reimbursements, for services performed by Rutan & Tucker, LLP, respectively. |
Selected Quarterly Financial Da
Selected Quarterly Financial Data (Unaudited) | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Data [Abstract] | |
Selected Quarterly Financial Data (Unaudited) | Selected Quarterly Financial Data (Unaudited) The following is a summary of the quarterly results of operations of the Company for years ended December 31, 2017 and 2016 : Quarter Ended(1) March 31 June 30 September 30 December 31 (dollars in thousands, except per share data) 2017 Revenues $ 95 $ 102 $ 123 $ 185 Operating expenses $ 10,221 $ 5,990 $ 5,921 $ 3,969 Net loss attributable to common stockholders $ (10,005 ) $ (8,052 ) $ (4,298 ) $ (2,576 ) Net loss per common share - basic $ 0.32 $ (0.26 ) $ (0.12 ) $ (0.06 ) Net loss per common share - diluted $ (0.32 ) $ (0.26 ) $ (0.12 ) $ (0.06 ) Shares used in the calculation of net loss attributable to common stockholders - basic 30,961,014 30,991,740 36,465,672 40,182,071 Shares used in the calculation of net loss attributable to common stockholders - diluted 30,961,014 30,991,740 36,465,672 40,182,071 2016 Revenues $ 120 $ 104 $ 89 $ 68 Operating expenses $ 10,579 $ 10,084 $ 10,013 $ 9,850 Net loss attributable to common stockholders $ (10,269 ) $ (10,208 ) $ (10,197 ) $ (8,554 ) Net loss per common share - basic $ (0.35 ) $ (0.34 ) $ (0.34 ) $ (0.28 ) Net loss per common share - diluted $ (0.36 ) $ (0.34 ) $ (0.34 ) $ (0.34 ) Shares used in the calculation of net loss attributable to common stockholders - basic 29,755,184 29,958,037 30,339,774 30,639,440 Shares used in the calculation of net loss attributable to common stockholders - diluted 30,108,377 29,958,037 30,339,774 30,711,946 (1) Basic and diluted net loss per common share are computed independently for each of the periods presented. Accordingly, the sum of the quarterly net loss per common share amount may not agree to the total for the year. |
Basis of Presentation and Sum22
Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents consist of operating and money market accounts as of December 31, 2017 and operating, money market accounts and commercial paper as of December 31, 2016 on deposit. Cash equivalents are considered by the Company to be highly liquid investments purchased with original maturities of three months or less from the date of purchase. |
Short-Term Investments | Short-Term Investments Short-term investments consist of corporate debt securities, U.S. treasury securities, and commercial paper. The Company classifies its short-term investments as available-for-sale, as the sale of such securities may be required prior to maturity to execute management strategies. Investments classified as available-for-sale are carried at fair value, with the unrealized gains and losses reported as a component of consolidated accumulated other comprehensive income (loss) in stockholders’ equity until realized. Realized gains and losses from the sale of available-for-sale securities, if any, are determined on a specific identification basis. A decline in the market value of any available-for-sale security below cost that is determined to be other than temporary will result in an impairment charge to earnings and a new cost basis for the security is established. No such impairment charges were recorded for any period presented. Premiums and discounts are amortized or accreted over the life of the related security as an adjustment to yield using the straight-line method and included in interest income. Interest income is recognized when earned. Realized gains and losses on investments in securities were included in other income (loss) within the consolidated statements of operations. |
Concentration of Credit Risk | Concentration of Credit Risk Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash and cash equivalents and short-term investments. The Company maintains deposit accounts at financial institutions that are in excess of federally insured limits. The Company has not experienced any losses in such accounts and believes it is not exposed to significant risk on its cash due to the financial position of the depository institution in which those deposits are held. We limit our exposure to credit loss by generally placing our cash and short-term investments in high credit quality financial institutions and investment in fixed income instruments denominated and payable in U.S. dollars. Additionally, we have established guidelines regarding diversification of our investments and their maturities, which are designed to maintain principal and maximize liquidity. |
Revenues | Revenues Revenue is recognized when persuasive evidence that an arrangement exists, delivery has occurred, the price is fixed or determinable, and collection is reasonably assured. Royalty and License Revenues The Company licenses and sublicenses its patent rights to healthcare companies, medical laboratories and biotechnology partners. These agreements may involve multiple elements such as license fees, royalties and milestone payments. Revenue is recognized when the criteria described above have been met as well as the following: • Up-front nonrefundable license fees pursuant to agreements under which the Company has no continuing performance obligations are recognized as revenues on the effective date of the agreement and when collection is reasonably assured. • Minimum royalties are recognized as earned, and royalties are earned based on the licensee’s use. The Company is unable to predict licensee’s sales and thus revenue is recognized upon receipt of notification from licensee and payment when collection is assured. Notification is generally one quarter in arrears. Diagnostic Service Revenues Revenue for clinical laboratory tests may come from several sources, including commercial third-party payors, such as insurance companies and health maintenance organizations, government payors, such as Medicare and Medicaid in the United States, patient self-pay and, in some cases, from hospitals or referring laboratories who, in turn, might bill third-party payors for testing. The Company is recognizing diagnostic service revenue on the cash collection basis until such time as it is able to properly estimate collections on third party reimbursements. Clinical Research Services Revenue Revenue from clinical research services consists primarily of revenue from the sale of urine and blood collection supplies under agreements with our clinical research and business development partners. Revenue is recognized when supplies are delivered. |
Allowance for Doubtful Accounts | Allowance for Doubtful Accounts The Company reviews the collectability of accounts receivable based on an assessment of historic experience, current economic conditions, and other collection indicators. At December 31, 2017 and 2016 the Company had not recorded an allowance for doubtful accounts. When accounts are determined to be uncollectible, they are written off against the reserve balance and the reserve is reassessed. When payments are received on reserved accounts, they are applied to the individual’s account and the reserve is reassessed. |
Derivative Financial Instruments—Warrants | Derivative Financial Instruments—Warrants The Company has issued common stock warrants in connection with the execution of certain equity financings. Such warrants are classified as derivative liabilities under the provisions of Financial Accounting Standards Board (“FASB”) ASC 815 Derivatives and Hedging (“ASC 815”) or ASC 480 Distinguishing Liabilities from Equity (“ASC 480”) are recorded at their fair market value as of each reporting period. Such warrants do not meet the exemption that a contract should not be considered a derivative instrument if it is (1) indexed to its own stock and (2) classified in stockholders’ equity. The warrants within the scope of ASC 480 contain a feature that could require the transfer of cash in the event a change of control occurs without an authorization of our Board of Directors, and therefore classified as a liability. Changes in fair value of derivative liabilities are recorded in the consolidated statement of operations under the caption “Change in fair value of derivative instruments.” |
Stock-Based Compensation | Stock-Based Compensation FASB ASC Topic 718 “ Compensation—Stock Compensation ” (“ASC 718”) requires companies to measure the cost of employee services received in exchange for the award of equity instruments based on the estimated fair value of the award at the date of grant. The expense is recognized ratably over the period during which an employee is required to provide services in exchange for the award. ASC 718 did not change the way Trovagene accounts for non-employee stock-based compensation. Trovagene continues to account for shares of common stock, stock options and warrants issued to non-employees based on the fair value of the stock, stock option or warrant, if that value is more reliably measurable than the fair value of the consideration or services received. The Company accounts for stock options issued and vesting to non-employees in accordance with FASB ASC Topic 505-50 “ Equity-Based Payment to Non-Employees ” , and, accordingly, the value of the stock compensation to non-employees is based upon the measurement date as determined at either (1) the date at which a performance commitment is reached, or (2) the date at which the necessary performance to earn the equity instruments is complete. Therefore, the fair value of these options is being “marked to market” quarterly until the measurement date is determined. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Financial instruments consist of cash and cash equivalents, short-term investments, accounts receivable, accounts payable, debt and derivative liabilities. The Company has adopted ASC 820 for financial assets and liabilities that are required to be measured at fair value and non-financial assets and liabilities that are not required to be measured at fair value on a recurring basis. These financial instruments are stated at their respective historical carrying amounts, which approximate fair value due to their short term nature as they reflect current market interest rates. Debt is stated at its respective historical carrying amounts, which approximate fair value as they reflect current market interest rates. In accordance with FASB ASC Subtopic 820-10, the Company measures certain assets and liabilities at fair value on a recurring basis using the three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. The three tiers include: • Level 1 — Quoted prices for identical instruments in active markets. • Level 2 — Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations where inputs are observable or where significant value drivers are observable. • Level 3 — Instruments where significant value drivers are unobservable to third parties. |
Long-Lived Assets | Long-Lived Assets Long-lived assets consist of property and equipment and finite-lived intangible assets. The Company records property and equipment at cost, and records other intangible assets based on their fair values at the date of acquisition. Depreciation on property and equipment is calculated using the straight-line method over the estimate useful life of five years for laboratory equipment and three to five years for furniture and office equipment. Amortization of leasehold improvements is computed based on the shorter of the life of the asset or the term of the lease. Amortization of intangible assets is calculated using the straight line method over the estimate useful life of the assets, based on when the Company expect to receive cash inflows generated by the intangible assets. |
Impairment Losses on Long-Lived Assets | Impairment losses on long-lived assets used in operations are recorded when indicators of impairment are present and the undiscounted cash flows estimated to be generated by those assets are less than the assets carrying amount. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the estimated fair value of the assets. |
Restructuring | Restructuring Restructuring costs are included in loss from operations in the consolidated statements of operations. The Company has accounted for these costs in accordance with ASC Topic 420, Exit or Disposal Cost Obligations . One-time termination benefits are recorded at the time they are communicated to the affected employees. In March 2017, the Company announced a restructuring plan which was completed as of December 31, 2017. See Note 12 to the consolidated financial statements for further information. |
Income Taxes | Income Taxes Income taxes are determined using the asset and liability approach of accounting for income taxes. Under this approach, deferred taxes represent the future tax consequences expected to occur when the reported amounts of assets and liabilities are recovered or paid. Deferred taxes result from differences between the financial statement and tax bases of Trovagene’s assets and liabilities and are adjusted for changes in tax rates and tax laws when changes are enacted. Valuation allowances are recorded to reduce deferred tax assets when it is more likely than not that a tax benefit will not be realized. The assessment of whether or not a valuation allowance is required often requires significant judgment. |
Contingencies | Contingencies In the normal course of business, Trovagene is subject to loss contingencies, such as legal proceedings and claims arising out of its business, that cover a wide range of matters, including, among others, government investigations, stockholder lawsuits, product and environmental liability, and tax matters. In accordance with FASB ASC Topic 450, Accounting for Contingencies , Trovagene records such loss contingencies when it is probable that a liability has been incurred and the amount of loss can be reasonably estimated. Trovagene, in accordance with this guidance, does not recognize gain contingencies until realized. |
Cost of Revenue | Cost of Revenue Cost of revenue represents the cost of materials, personnel costs, costs associated with processing specimens including pathological review, quality control analyses, and delivery charges necessary to render an individualized test result. Costs associated with performing tests are recorded as the tests are processed. However, the revenue on diagnostic services is recognized on a cash collection basis resulting in costs incurred before the collection of related revenue. |
Research and Development | Research and Development Research and development expenses, which include expenditures in connection with an in-house research and development laboratory, salaries and staff costs, purchased in-process research and development and regulatory and scientific consulting fees, as well as contract research and insurance, are accounted for in accordance with FASB ASC Topic 730-10-55-2, Research and Development. Also, as prescribed by this guidance, patent filing and maintenance expenses are considered legal in nature and therefore classified as general and administrative expense, if any. While certain of the Company’s research and development costs may have future benefits, the Company’s policy of expensing all research and development expenditures is predicated on the fact that Trovagene has no history of successful commercialization of molecular diagnostic products to base any estimate of the number of future periods that would be benefited. FASB ASC Topic 730, Research and Development requires that non-refundable advance payments for goods or services that will be used or rendered for future research and development activities be deferred and capitalized. As the related goods are delivered or the services are performed, or when the goods or services are no longer expected to be provided, the deferred amounts are recognized as an expense. |
Net Loss Per Share | Net Loss Per Share Basic and diluted net loss per share is presented in conformity with FASB ASC Topic 260, Earnings per Share , for all periods presented. In accordance with this guidance, basic and diluted net loss per common share is determined by dividing net loss applicable to common stockholders by the weighted-average common shares outstanding during the period. Preferred dividends are included in income available to common stockholders in the computation of basic and diluted earnings per share. |
Change in Accounting Principle and Recent Accounting Pronouncements | Change in Accounting Principle In March 2016, the FASB issued ASU 2016-09, Improvements to Employee Share-Based Payment Accounting (“ASU 2016-09”), which aims to simplify the accounting for share-based payment transactions, including accounting for income taxes, classification on the statement of cash flows, accounting for forfeitures, and classification of awards as either liabilities or equity. In addition, under the ASU 2016-09, excess income tax benefits from share-based compensation arrangements are classified as cash flow from operations, rather than cash flow from financing activities. The Company adopted ASU 2016-09 as of January 1, 2017 and has elected to continue estimating forfeitures based on historical experience. The adoption of ASU 2016-09 had no impact on the Company’s financial statements. Recent Accounting Pronouncements In August 2016, the FASB issued Accounting Standards Update (“ASU”) 2016-15, Classification of Certain Cash Receipts and Cash Payments (“ASU 2016-15”), which includes amendments that clarify how certain cash receipts and cash payments are presented in the statement of cash flows. ASU 2016-15 also provides guidance clarifying when an entity should separate cash receipts and cash payments and classify them into more than one class of cash flows. The new amendments and guidance are effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. Early adoption is permitted provided that all amendments are adopted in the same period. The Company is currently evaluating the impact of adoption of ASU 2016-15 on its consolidated statements of cash flows. In February 2016, the FASB issued ASU 2016-02, Leases . The new standard establishes a right-of-use (“ROU”) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for most leases. The new standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. A modified retrospective transition approach is required for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. The new standard will impact the Company’s accounting for its office leases and the Company is currently evaluating the impact of the new standard on its consolidated financial statements. In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”). The new standard is based on the principle that revenue should be recognized to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Since its initial release, the FASB has issued several amendments to the standard, which include clarification of accounting guidance related to identification of performance obligations, intellectual property licenses, and principle versus agent considerations. ASU 2014-09 and all subsequent amendments (collectively, “ASC 606”) became effective for the Company on January 1, 2018 and was adopted the standard using the modified retrospective method. The cumulative effect of applying the new standard is immaterial and we will recognize the amount in retained earnings on the date of initial application. Under ASC 606, the Company will accrue for royalties as earned and no longer record them on a lag. The Company has reviewed its revenue streams to identify potential differences in accounting under the new revenue recognition standard. The Company’s timing and measurement of revenue recognition will not be materially affected by the adoption and implementation of ASC 606. Currently, the Company does not have any significant contracts with customers given its stage of development. The Company has derived its revenues primarily from a limited number of royalty, license and diagnostic service agreements. The consideration the Company is eligible to receive under these agreements includes upfront license payments, milestone payments and royalties. Each of these agreements has unique terms that have been evaluated separately under the new standards. The new standards differ from the current accounting standard in many respects, such as in the accounting for variable consideration, including milestone payments. For example, the Company currently recognizes milestone revenue using the milestone method specified in ASC 605-28, which generally results in recognition of milestone revenue in the period that the milestone event is achieved. However, under the new standards, it is possible to start to recognize milestone revenue before the milestone is achieved if management determines with a high degree of certainty that amounts recorded as revenues will not have to be reversed when the uncertainty associated with the variable consideration is subsequently resolved. The Company has assessed the potential impact that the new standards may have with respect to its diagnostic service revenue and has determined to recognize its diagnostic service revenue on a cash collection basis as it does currently. The Company has completed its full assessment of the impact the new standards will have on its financial statements before the year-end 2017. The assessment concludes the Company will not have a significant change in the timing and measurement of its revenue upon adoption of the new standards. The Company will adopt the new standards effective January 1, 2018 using the modified retrospective transition method. The Company’s current assessment identifies a highly immaterial adjustment to beginning retained earnings for the cumulative effect of the change. |
Basis of Presentation and Sum23
Basis of Presentation and Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Schedule of Antidilutive Securities Excluded from the Calculation of Basic and Diluted Loss Per Share | Shares used in calculating diluted net loss per common share exclude as anti-dilutive the following share equivalents: December 31, 2017 2016 Options to purchase Common Stock 4,490,475 5,528,628 Warrants to purchase Common stock 23,555,520 4,538,606 Restricted Stock Units 1,274,302 272,000 Series A Convertible Preferred Stock 63,125 63,125 29,383,422 10,402,359 |
Summary of the Company’s Diluted Net Loss Per Share | The following table summarizes the Company’s diluted net loss per share: December 31, 2017 2016 Numerator: Net loss attributable to common stockholders $ (24,930,984 ) $ (39,227,959 ) Adjustment for gain from change in fair value of derivative financial instruments—warrants — (2,321,053 ) Net loss used for diluted loss per share $ (24,930,984 ) $ (41,549,012 ) Denominator: Weighted-average shares used to compute basic net loss per share 34,680,362 30,174,838 Adjustments to reflect assumed exercise of warrants — 106,425 Weighted-average shares used to compute diluted net loss per share 34,680,362 30,281,263 Net loss per share attributable to common stockholders: Basic $ (0.72 ) $ (1.30 ) Diluted $ (0.72 ) $ (1.37 ) |
Supplementary Balance Sheet I24
Supplementary Balance Sheet Information (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Composition of Short-Term Investments | The following table sets forth the composition of short-term investments as of December 31, 2016 . Unrealized Maturity in Years Cost Gains Losses Fair Value Corporate debt securities Less than 1 year $ 14,165,915 $ 44 $ (5,273 ) $ 14,160,686 Commercial paper Less than 1 year 1,195,444 — — 1,195,444 U.S. treasury securities Less than 1 year 8,625,728 330 (4,166 ) 8,621,892 Total investment $ 23,987,087 $ 374 $ (9,439 ) $ 23,978,022 |
Components of Property and Equipment | Property and equipment consisted of the following: As of December 31, 2017 2016 Furniture and office equipment $ 1,076,709 $ 1,144,741 Leasehold improvements 1,994,514 1,994,514 Laboratory equipment 1,426,581 2,449,645 4,497,804 5,588,900 Less—accumulated depreciation and amortization (2,071,492 ) (1,761,985 ) Property and equipment, net $ 2,426,312 $ 3,826,915 |
Components of Accrued Liabilities | Accrued liabilities consisted of the following: As of December 31, 2017 2016 Accrued compensation $ 618,128 $ 2,203,876 Accrued research agreements 135,139 736,199 Accrued professional fees — 421,314 Other accrued liabilities 701,320 659,976 Total accrued liabilities $ 1,454,587 $ 4,021,365 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Stockholders' Equity Note [Abstract] | |
Summary of Warrant Activity and Changes in Warrants Outstanding | A summary of warrant activity and changes in warrants outstanding, including both liability and equity classifications, is presented below: Number of Warrants (1) Weighted-Average Exercise Price Per Share (1) Weighted-Average Remaining Contractual Term (1) Balance outstanding, December 31, 2015 5,533,242 $ 3.86 2.5 Granted 30,992 $ 4.84 Exercised (8,333 ) $ 3.00 Expired (50,000 ) $ 8.00 Balance outstanding, December 31, 2016 5,505,901 $ 3.83 1.6 Granted 19,643,626 $ 0.56 Expired (1,910,674 ) $ 5.32 Balance outstanding, December 31, 2017 23,238,853 $ 0.95 4.4 (1) Excluded the pre-funded warrants to purchase 316,667 shares of common stock at a nominal exercise price of $0.01 per share. The pre-warrants expire when exercised in full. |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Summary of Stock Option Activity | Stock-based compensation has been recognized in operating results as follows: Years ended December 31, 2017 2016 In cost of revenue $ 83,713 $ 122,301 In research and development expenses 1,026,497 2,420,696 In selling and marketing expense 676,635 2,111,366 In general and administrative expenses 2,350,962 2,910,156 Benefit from restructuring (125,222 ) (60,203 ) Total stock-based compensation $ 4,012,585 $ 7,504,316 |
Estimated Fair Value of Stock Options - Assumptions | The estimated fair value of stock option awards was determined on the date of grant using the Black-Scholes option valuation model with the following assumptions during the years indicated below: Years ended December 31, 2017 2016 Risk-free interest rate 1.82% - 2.03% 0.93% - 1.89% Dividend yield 0% 0% Expected volatility (range) 86% - 117% 80% - 134% Expected volatility (weighted-average) 87% 103% Expected term (in years) 5.3 years 5.5 years |
Stock-Based Compensation Recognized | A summary of stock option activity and of changes in stock options outstanding is presented below: Number of Options Weighted-Average Exercise Price Per Share Intrinsic Value Weighted-Average Remaining Contractual Life Balance outstanding, December 31, 2015 6,948,630 $ 5.45 $ 5,903,466 7.8 years Granted 3,246,250 $ 5.02 Exercised (1,335,271 ) $ 3.81 Forfeited (3,330,981 ) $ 5.63 Balance outstanding, December 31, 2016 5,528,628 $ 5.49 $ — 7.7 years Granted 1,059,242 $ 0.82 Forfeited (2,079,938 ) $ 6.24 Expired (17,457 ) $ 4.74 Balance outstanding, December 31, 2017 4,490,475 $ 4.04 $ — 7.1 years Vested and exercisable, December 31, 2017 2,745,350 $ 4.66 $ — 6.0 years |
Summary of Restricted Stock Unit Activity | A summary of the RSU activity is presented below: Number of Shares Weighted Average Grant Date Fair Value Per Share Intrinsic Non-vested RSU outstanding, December 31, 2015 — $ — $ — Granted 402,000 $ 4.06 Vested (95,000 ) $ 4.27 Forfeited (35,000 ) $ 3.99 Non-vested RSU outstanding, December 31, 2016 272,000 $ 3.99 $ 571,200 Granted 2,249,242 $ 1.59 Vested (372,487 ) $ 3.47 Forfeited (874,453 ) $ 1.75 Non-vested RSU outstanding, December 31, 2017 1,274,302 $ 1.43 $ 391,848 |
Derivative Financial Instrume27
Derivative Financial Instruments - Warrants (Tables) - Black Scholes Option Pricing Method | 12 Months Ended |
Dec. 31, 2017 | |
Derivative financial instruments | |
Schedule of Assumptions Used to Determine the Fair Value of Warrants | The range of assumptions used to determine the fair value of the warrants valued using the Black-Scholes option pricing model during the periods indicated was: Year ended December 31 2017 2016 Estimated fair value of Trovagene common stock $0.31 - $1.26 $2.10 - $4.65 Expected warrant term 1.0 - 5.5 years 2.0 - 2.8 years Risk-free interest rate 1.27% - 2.21% 0.71% - 1.20% Expected volatility 86% - 116% 82% - 94% Dividend yield —% —% |
Schedule of Components of Changes in the Company’s Derivative Financial Instruments Liability Balance | The following table sets forth the components of changes in the Company’s derivative financial instruments — warrants liability balance, valued using the Black-Scholes option pricing method, for the periods indicated. Date Description Number of Warrants Derivative Instrument Liability December 31, 2015 Balance of derivative financial instruments — warrants liability 967,295 $ 3,297,077 Change in fair value of derivative financial instruments — warrants during the year recognized as a gain in the statement of operations — (2,462,137 ) December 31, 2016 Balance of derivative financial instruments — warrants liability 967,295 834,940 Issuance of Derivative Financial Instruments 4,643,626 3,215,519 Change in fair value of derivative financial instruments — warrants during the year recognized as a gain in the statement of operations — (3,401,072 ) December 31, 2017 Balance of derivative financial instruments — warrants liability 5,610,921 $ 649,387 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Schedule of Company’s Assets and Liabilities that are Measured and Recognized at Fair Value on a Recurring Basis Classified Under the Appropriate Level of the Fair Value Hierarchy | The following table presents the Company’s assets and liabilities that are measured and recognized at fair value on a recurring basis classified under the appropriate level of the fair value hierarchy as of December 31, 2017 and 2016 : Fair Value Measurements at Quoted Prices in Active Markets for Identical Assets and Liabilities Significant Other Observable Inputs Significant Unobservable Inputs Total Assets: Money market fund (1) $ 4,522,631 $ — $ — $ 4,522,631 Total Assets $ 4,522,631 $ — $ — $ 4,522,631 Liabilities: Derivative financial instruments — warrants $ — $ — $ 649,387 $ 649,387 Total Liabilities $ — $ — $ 649,387 $ 649,387 Fair Value Measurements at Quoted Prices in Active Markets for Identical Assets and Liabilities Significant Other Observable Inputs Significant Unobservable Inputs Total Assets: Money market fund (1) $ 12,095,620 $ — $ — $ 12,095,620 Corporate debt securities (2) — 14,160,686 — 14,160,686 Commercial paper (3) — 2,393,948 — 2,393,948 U.S. treasury securities (2) — 8,621,892 — 8,621,892 Total Assets $ 12,095,620 $ 25,176,526 $ — $ 37,272,146 Liabilities: Derivative financial instruments — warrants $ — $ — $ 834,940 $ 834,940 Total Liabilities $ — $ — $ 834,940 $ 834,940 (1) Included as a component of cash and cash equivalents on the accompanying consolidated balance sheet. (2) Included in short-term investments on the accompanying consolidated balance sheet. (3) $1,198,504 of commercial paper was included as a component of cash and cash equivalents, and the rest of amount was included in short-term investments on the accompanying consolidated balance sheet. |
Schedule of Changes in the Fair Value of the Company’s Level 3 Liabilities | The following table sets forth a summary of changes in the fair value of the Company’s Level 3 liabilities for the years ended December 31, 2017 and 2016 : Description Balance at Issuance of Derivative Financial Instruments Unrealized (gains) or losses Balance at Derivative financial instruments — Warrants $ 834,940 $ 3,215,519 $ (3,401,072 ) $ 649,387 Description Balance at Unrealized (gains) or losses Balance at Derivative financial instruments — Warrants $ 3,297,077 $ (2,462,137 ) $ 834,940 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Provision for Income Taxes Based on Losses from Continuing Operations | The provision for income taxes based on losses from continuing operations consists of the following at December 31 (in thousands): Years ended December 31, 2017 2016 Current: State $ 1 $ — Total current provision 1 — Deferred: Federal 9,781 (14,035 ) State 3,171 (2,443 ) Foreign — (114 ) Total deferred expense (benefit) 12,952 (16,592 ) Valuation allowance (12,953 ) 16,592 Total income tax provision $ — $ — |
Schedule of Significant Components of the Company’s Taxes and the Rates | Significant components of the Company’s taxes and the rates as of December 31 are shown below (in thousands, except percentages): Years ended December 31, 2017 2016 Tax computed at the federal statutory rate $ (8,591 ) 34 % $ (13,206 ) 34 % State tax, net of federal tax benefit (697 ) 3 % (2,286 ) 6 % Foreign tax — — % (114 ) — % Permanent Items (706 ) 3 % (114 ) — % Tax credits (431 ) 2 % (1,276 ) 3 % Valuation allowance increase (11,029 ) 43 % 16,996 (43 )% Tax rate change 21,454 (85 )% — — % Provision for income taxes $ — — % $ — — % |
Schedule of Significant Components of the Company’s Deferred Tax Assets | Significant components of the Company’s deferred tax assets and liabilities from federal and state income taxes as of December 31 are shown below (in thousands): Years ended December 31, 2017 2016 Deferred tax assets: Tax loss carryforwards $ 29,713 $ 41,502 Research and development credits and other tax credits 3,084 2,817 Stock-based compensation 3,565 4,658 Other 945 1,283 Total deferred tax assets 37,307 50,260 Valuation allowance (37,307 ) (50,260 ) Net deferred tax asset $ — $ — |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Annual Commitments Under Current Lease Agreements | Total annual commitments under non-cancelable lease agreements for each of the years ended December 31 are as follows: Operating Leases Sublease Income Net Operating Leases 2018 $ 881,815 $ (216,504 ) $ 665,311 2019 906,879 (183,124 ) 723,755 2020 931,457 — 931,457 2021 959,401 — 959,401 2022 — — — Thereafter — — — Total $ 3,679,552 $ (399,628 ) $ 3,279,924 |
Selected Quarterly Financial 31
Selected Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Data [Abstract] | |
Summary of the Quarterly Results of Operations | The following is a summary of the quarterly results of operations of the Company for years ended December 31, 2017 and 2016 : Quarter Ended(1) March 31 June 30 September 30 December 31 (dollars in thousands, except per share data) 2017 Revenues $ 95 $ 102 $ 123 $ 185 Operating expenses $ 10,221 $ 5,990 $ 5,921 $ 3,969 Net loss attributable to common stockholders $ (10,005 ) $ (8,052 ) $ (4,298 ) $ (2,576 ) Net loss per common share - basic $ 0.32 $ (0.26 ) $ (0.12 ) $ (0.06 ) Net loss per common share - diluted $ (0.32 ) $ (0.26 ) $ (0.12 ) $ (0.06 ) Shares used in the calculation of net loss attributable to common stockholders - basic 30,961,014 30,991,740 36,465,672 40,182,071 Shares used in the calculation of net loss attributable to common stockholders - diluted 30,961,014 30,991,740 36,465,672 40,182,071 2016 Revenues $ 120 $ 104 $ 89 $ 68 Operating expenses $ 10,579 $ 10,084 $ 10,013 $ 9,850 Net loss attributable to common stockholders $ (10,269 ) $ (10,208 ) $ (10,197 ) $ (8,554 ) Net loss per common share - basic $ (0.35 ) $ (0.34 ) $ (0.34 ) $ (0.28 ) Net loss per common share - diluted $ (0.36 ) $ (0.34 ) $ (0.34 ) $ (0.34 ) Shares used in the calculation of net loss attributable to common stockholders - basic 29,755,184 29,958,037 30,339,774 30,639,440 Shares used in the calculation of net loss attributable to common stockholders - diluted 30,108,377 29,958,037 30,339,774 30,711,946 (1) Basic and diluted net loss per common share are computed independently for each of the periods presented. Accordingly, the sum of the quarterly net loss per common share amount may not agree to the total for the year. |
Business Overview and Liquidi32
Business Overview and Liquidity (Details) - USD ($) $ in Thousands | Feb. 20, 2018 | Dec. 31, 2016 |
Subsequent Event [Line Items] | ||
Number of warrants exercised (in shares) | 8,333 | |
Subsequent Event | ||
Subsequent Event [Line Items] | ||
Proceeds from warrant exercises | $ 452 | |
Number of warrants exercised (in shares) | 1,814,167 |
Basis of Presentation and Sum33
Basis of Presentation and Summary of Significant Accounting Policies - Short-Term Investments (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Accounting Policies [Abstract] | ||
Realized gains (losses) on available-for-sale securities | $ 6,400 | $ 0 |
Basis of Presentation and Sum34
Basis of Presentation and Summary of Significant Accounting Policies - Warrants (Details) - USD ($) | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Derivative financial instruments | |||
Derivative financial instruments—warrants | $ 649,387 | $ 834,940 | |
Warrants to purchase Common stock | Black Scholes Option Pricing Method | |||
Derivative financial instruments | |||
Derivative financial instruments—warrants | $ 649,387 | $ 834,940 | $ 3,297,077 |
Basis of Presentation and Sum35
Basis of Presentation and Summary of Significant Accounting Policies - Long-Lived Assets (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Property, Plant and Equipment [Line Items] | ||
Impairment of long-lived assets held-for-use | $ 104,700 | $ 0 |
Laboratory equipment | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful lives | 5 years | |
Furniture and office equipment | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful lives | 3 years | |
Furniture and office equipment | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful lives | 5 years |
- Anti-dilutive Share Equivalen
- Anti-dilutive Share Equivalents (Details) - shares | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Net Loss Per Share | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 29,383,422 | 10,402,359 |
Options to purchase Common Stock | ||
Net Loss Per Share | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 4,490,475 | 5,528,628 |
Warrants to purchase Common stock | ||
Net Loss Per Share | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 23,555,520 | 4,538,606 |
Restricted Stock Units | ||
Net Loss Per Share | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 1,274,302 | 272,000 |
Series A Convertible Preferred Stock | ||
Net Loss Per Share | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 63,125 | 63,125 |
Basis of Presentation and Sum37
Basis of Presentation and Summary of Significant Accounting Policies - Diluted Net Loss per Share (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | |
Numerator: | ||||||||||
Net loss attributable to common stockholders | $ (2,576,000) | $ (4,298,000) | $ (8,052,000) | $ (10,005,000) | $ (8,554,000) | $ (10,197,000) | $ (10,208,000) | $ (10,269,000) | $ (24,930,984) | $ (39,227,959) |
Adjustment for gain from change in fair value of derivative financial instruments—warrants | 0 | (2,321,053) | ||||||||
Net loss used for diluted loss per share | $ (24,930,984) | $ (41,549,012) | ||||||||
Denominator: | ||||||||||
Weighted-average shares outstanding - basic (in shares) | 40,182,071 | 36,465,672 | 30,991,740 | 30,961,014 | 30,639,440 | 30,339,774 | 29,958,037 | 29,755,184 | 34,680,362 | 30,174,838 |
Adjustments to reflect assumed exercise of warrants (in shares) | 0 | 106,425 | ||||||||
Weighted-average shares used to compute diluted net loss (in shares) | 40,182,071 | 36,465,672 | 30,991,740 | 30,961,014 | 30,711,946 | 30,339,774 | 29,958,037 | 30,108,377 | 34,680,362 | 30,281,263 |
Net loss per common share - basic (in dollars per share) | $ (0.06) | $ (0.12) | $ (0.26) | $ 0.32 | $ (0.28) | $ (0.34) | $ (0.34) | $ (0.35) | $ (0.72) | $ (1.30) |
Net loss per common share - diluted (in dollars per share) | $ (0.06) | $ (0.12) | $ (0.26) | $ (0.32) | $ (0.34) | $ (0.34) | $ (0.34) | $ (0.36) | $ (0.72) | $ (1.37) |
Supplementary Balance Sheet I38
Supplementary Balance Sheet Information - Short-term Investments (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Schedule of Available-for-sale Securities [Line Items] | ||
Cost | $ 23,987,087 | |
Gains | 374 | |
Losses | (9,439) | |
Estimate of Fair Value Measurement | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Short-term Investments | 23,978,022 | |
Corporate debt securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Maturity in Years | 1 year | |
Cost | 14,165,915 | |
Gains | 44 | |
Losses | (5,273) | |
Corporate debt securities | Estimate of Fair Value Measurement | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Short-term Investments | 14,160,686 | |
Commercial paper | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Maturity in Years | 1 year | |
Cost | 1,195,444 | |
Gains | 0 | |
Losses | 0 | |
Commercial paper | Estimate of Fair Value Measurement | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Short-term Investments | 1,195,444 | |
U.S. treasury securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Maturity in Years | 1 year | |
Cost | 8,625,728 | |
Gains | 330 | |
Losses | (4,166) | |
U.S. treasury securities | Estimate of Fair Value Measurement | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Short-term Investments | $ 8,621,892 |
Supplementary Balance Sheet I39
Supplementary Balance Sheet Information - Property and Equipment (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Property, Plant and Equipment [Line Items] | ||
Depreciation and amortization | $ 1,053,913 | $ 969,833 |
Property and equipment | 4,497,804 | 5,588,900 |
Less—accumulated depreciation and amortization | (2,071,492) | (1,761,985) |
Property and equipment, net | 2,426,312 | 3,826,915 |
Furniture and office equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | 1,076,709 | 1,144,741 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | 1,994,514 | 1,994,514 |
Laboratory equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | $ 1,426,581 | $ 2,449,645 |
Supplementary Balance Sheet I40
Supplementary Balance Sheet Information - Accrued Expenses (Details) - USD ($) | Dec. 31, 2017 | Dec. 31, 2016 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Accrued compensation | $ 618,128 | $ 2,203,876 |
Accrued research agreements | 135,139 | 736,199 |
Accrued professional fees | 0 | 421,314 |
Other accrued liabilities | 701,320 | 659,976 |
Total accrued liabilities | $ 1,454,587 | $ 4,021,365 |
Stockholders' Equity - Common
Stockholders' Equity - Common Stock Narrative (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Class of Stock [Line Items] | ||
Proceeds from the sale of common stock | $ 11,727,153 | $ 2,364,801 |
Shares issued upon exercise of warrants (in shares) | 8,333 | |
Warrants granted (in shares) | 19,643,626 | 30,992 |
Restricted stock issued during period (in shares) | 745,392 | |
Option exercise price, weighted average of $3.81 | ||
Class of Stock [Line Items] | ||
Issuance of common stock upon exercise of stock options (in shares) | 1,236,875 | |
Warrant exercise price of $3.00 | ||
Class of Stock [Line Items] | ||
Shares issued upon exercise of warrants (in shares) | 8,333 | |
Common Stock | ||
Class of Stock [Line Items] | ||
Shares of common stock issued (in shares) | 20,976,914 | 421,810 |
Issuance of common stock upon exercise of stock options (in shares) | 98,396 | |
Issuance of common stock upon net exercise of warrant (in shares) | 2,651 | |
Issuance of common stock upon releases of restricted stock units (in shares) | 372,487 | 95,000 |
Common Stock | Option exercise price of $3.73 | ||
Class of Stock [Line Items] | ||
Issuance of common stock upon exercise of stock options (in shares) | 98,396 | |
Weighted average price of shares (in dollars per share) | $ 3.73 | |
Common Stock | Option exercise price, weighted average of $3.81 | ||
Class of Stock [Line Items] | ||
Weighted average price of shares (in dollars per share) | $ 3.81 | |
Shares issued upon exercise (in shares) | 341,333 | |
Common Stock | Warrant exercise price of $3.00 | ||
Class of Stock [Line Items] | ||
Issuance of common stock upon net exercise of warrant (in shares) | 2,651 | |
Exercise price of warrants (in dollars per share) | $ 3 | |
Agent | ||
Class of Stock [Line Items] | ||
RSUs issued during period (shares) | 372,487 | |
Restricted stock issued during period (in shares) | 745,392 | |
Agent | Common Stock | ||
Class of Stock [Line Items] | ||
Stock issued during period including share-based compensation (in shares) | 22,094,793 | 959,190 |
Proceeds from the sale of common stock | $ 2,400,000 | |
Shares of common stock issued (in shares) | 421,810 | |
Price per share (in dollars per share) | $ 5.61 | |
Agent | Registered Direct Offering | ||
Class of Stock [Line Items] | ||
Proceeds from the sale of common stock | $ 11,600,000 | |
Agent | Public Offering and Controlled Equity Offering | Common Stock | ||
Class of Stock [Line Items] | ||
Proceeds from the sale of common stock | $ 100,000 | |
Shares of common stock issued (in shares) | 102,081 | |
Price per share (in dollars per share) | $ 1.08 | |
Private Placement | ||
Class of Stock [Line Items] | ||
Warrants granted (in shares) | 4,643,626 | |
Private Placement | Agent | Warrants to purchase Common stock | ||
Class of Stock [Line Items] | ||
Warrants granted (in shares) | 19,960,293 | |
Registered Direct Offering | Agent | Common Stock | ||
Class of Stock [Line Items] | ||
Shares of common stock issued (in shares) | 20,874,833 |
Stockholders' Equity - Schedul
Stockholders' Equity - Schedule of Warrants (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Number of Warrants (1) | |||
Balance of warrants outstanding at the beginning of the period (in shares) | 5,505,901 | 5,533,242 | |
Granted (in shares) | 19,643,626 | 30,992 | |
Exercised (in shares) | (8,333) | ||
Expired (in shares) | (1,910,674) | (50,000) | |
Balance of warrants outstanding at the end of the period (in shares) | 23,238,853 | 5,505,901 | 5,533,242 |
Weighted-Average Exercise Price Per Share (1) | |||
Weighted average exercise price of warrants at the beginning of the period (in dollars per share) | $ 3.83 | $ 3.86 | |
Granted (in dollars per share) | 0.56 | 4.84 | |
Exercised (in dollars per share) | 3 | ||
Expired (in dollars per share) | 5.32 | 8 | |
Weighted average exercise price of warrants at the end of the period (in dollars per share) | $ 0.95 | $ 3.83 | $ 3.86 |
Weighted-Average Remaining Contractual Term (1) | |||
Weighted-Average Remaining Contractual Term (1) | 4 years 4 months 21 days | 1 year 7 months 6 days | 2 years 6 months 11 days |
Stockholders' Equity - Warrant
Stockholders' Equity - Warrants Narrative (Details) - USD ($) | 1 Months Ended | 12 Months Ended | |||
Jul. 31, 2013 | Dec. 31, 2017 | Dec. 31, 2016 | Jul. 20, 2016 | Jun. 30, 2015 | |
Class of Stock [Line Items] | |||||
Warrants granted (in shares) | 19,643,626 | 30,992 | |||
Warrants granted (in dollars per share) | $ 0.56 | $ 4.84 | |||
Proceeds from the sale of common stock | $ 100,000 | ||||
Value of warrants recorded as debt discount and additional paid in capital | $ 0 | $ 148,885 | |||
Public Offering and Controlled Equity Offering | |||||
Class of Stock [Line Items] | |||||
Proceeds from the sale of common stock | $ 15,000,000 | ||||
Secured Debt | |||||
Class of Stock [Line Items] | |||||
Exercise price of warrants (in dollars per share) | $ 4.84 | ||||
Line of Credit | Secured Debt | |||||
Class of Stock [Line Items] | |||||
Exercise price of warrants (in dollars per share) | $ 3.51 | ||||
Value of warrants recorded as debt discount and additional paid in capital | $ 148,885 | ||||
Line of Credit | Secured Debt | Black Scholes Option Pricing Method | |||||
Class of Stock [Line Items] | |||||
Risk-free interest rate (as a percent) | 1.59% | ||||
Dividend yield (as a percent) | 0.00% | ||||
Expected volatility (as a percent) | 130.66% | ||||
Expected warrant term | 10 years | ||||
Private Placement | |||||
Class of Stock [Line Items] | |||||
Warrants granted (in shares) | 4,643,626 | ||||
Warrants granted (in dollars per share) | $ 1.41 | ||||
Expiration period | 5 years | ||||
Public Offering | |||||
Class of Stock [Line Items] | |||||
Warrants granted (in shares) | 15,000,000 | ||||
Warrants granted (in dollars per share) | $ 0.30 | ||||
Expiration period | 5 years | ||||
Pre-funded Warrant | Public Offering | |||||
Class of Stock [Line Items] | |||||
Warrants granted (in shares) | 316,667 | ||||
Exercise price of warrants (in dollars per share) | $ 0.01 | ||||
Warrants granted (in dollars per share) | $ 0.29 |
Stockholders' Equity - Preferr
Stockholders' Equity - Preferred Stock (Details) - USD ($) | Mar. 17, 2007 | Jul. 13, 2006 | Mar. 17, 2006 | Dec. 31, 2017 | Dec. 31, 2016 |
Class of Stock [Line Items] | |||||
Accrued dividend during the period | $ 24,240 | $ 24,240 | |||
Stated value per share (in dollars per share) | $ 0.001 | $ 0.001 | |||
Number of shares outstanding (in shares) | 60,600 | 60,600 | |||
Accumulated Deficit | |||||
Class of Stock [Line Items] | |||||
Accrued dividend during the period | $ 24,240 | $ 24,240 | |||
Series A Convertible Preferred Stock | |||||
Class of Stock [Line Items] | |||||
Cumulative dividend rate (as a percent) | 4.00% | ||||
Accrued cumulative unpaid preferred stock dividends | $ 316,775 | $ 292,535 | |||
Stated value per share (in dollars per share) | $ 10 | ||||
Conversion price per share (in dollars per share) | $ 9.60 | $ 2.15 | |||
Period during which the conversion price is subject to adjustment for dilutive issuances | 12 months | ||||
Share price for 20 consecutive trading days for automatic conversion | $ 25.80 | ||||
Number of consecutive trading days in which the closing price of the entity's common stock must equal or exceed a specified price in order for the preferred stock to be automatically converted | 20 days | ||||
Number of common stock shares traded per day during the 20 trading days for the preferred stock to be automatically converted | 8,333 | ||||
Number of trading days in which the specified volume of common stock must be traded for the preferred stock to be automatically converted | 20 days | ||||
Number of shares outstanding (in shares) | 60,600 | 60,600 |
Stock-Based Compensation - Stoc
Stock-Based Compensation - Stock-Based Compensation (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Total stock-based compensation | $ 4,012,585 | $ 7,504,316 |
In cost of revenue | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Total stock-based compensation | 83,713 | 122,301 |
In research and development expenses | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Total stock-based compensation | 1,026,497 | 2,420,696 |
In selling and marketing expense | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Total stock-based compensation | 676,635 | 2,111,366 |
In general and administrative expenses | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Total stock-based compensation | 2,350,962 | 2,910,156 |
Benefit from restructuring | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Total stock-based compensation | $ (125,222) | $ (60,203) |
Stock-Based Compensation - Assu
Stock-Based Compensation - Assumptions Using Black-Scholes for Estimated Fair Value of Stock Options (Details) - Options to purchase Common Stock | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Dividend yield | 0.00% | 0.00% |
Expected volatility (weighted-average) | 87.00% | 103.00% |
Expected term (in years) | 5 years 3 months 18 days | 5 years 5 months 16 days |
Minimum | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Risk-free interest rate | 1.82% | 0.93% |
Expected volatility (range) | 86.00% | 80.00% |
Maximum | ||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | ||
Risk-free interest rate | 2.03% | 1.89% |
Expected volatility (range) | 117.00% | 134.00% |
Stock-Based Compensation - Summ
Stock-Based Compensation - Summary of Stock Options Activity (Details) - Options to purchase Common Stock - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Number of Options | |||
Beginning balance (in shares) | 5,528,628 | 6,948,630 | |
Granted (in shares) | 1,059,242 | 3,246,250 | |
Exercise (in shares) | (1,335,271) | ||
Forfeitures (in shares) | (2,079,938) | (3,330,981) | |
Expired (in shares) | (17,457) | ||
Ending balance (in shares) | 4,490,475 | 5,528,628 | 6,948,630 |
Vested and exercisable (in shares) | 2,745,350 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract] | |||
Outstanding (in USD per share) | $ 5.49 | $ 5.45 | |
Granted (in USD per share) | 0.82 | 5.02 | |
Exercised (in USD per share) | 3.81 | ||
Forfeited (in USD per share) | 6.24 | 5.63 | |
Expired (in USD per share) | 4.74 | ||
Outstanding (in USD per share) | 4.04 | $ 5.49 | $ 5.45 |
Vested and exercisable (in USD per share) | $ 4.66 | ||
Intrinsic value, outstanding | $ 0 | $ 0 | $ 5,903,466 |
Intrinsic value, vested and exercisable | $ 0 | ||
Weighted average remaining contract term, outstanding | 7 years 1 month 10 days | 7 years 7 months 28 days | 7 years 9 months 11 days |
Weighted average remaining contractual term, exercisable | 6 years 11 days |
Stock-Based Compensation - Narr
Stock-Based Compensation - Narrative (Details) - USD ($) | Jun. 10, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Jun. 13, 2017 | May 17, 2016 | Sep. 17, 2014 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Aggregate intrinsic value of RSUs vested | $ 647,885 | $ 293,781 | ||||
Total intrinsic value of options exercised | 0 | 1,932,799 | ||||
Fair value of shares vested | 3,992,127 | $ 6,261,655 | ||||
Tax benefits recognized for stock-based compensation | $ 0 | |||||
Restricted stock issued during period (in shares) | 745,392 | |||||
Options to purchase Common Stock | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Weighted average grant date fair value (in USD per share) | $ 0.56 | $ 3.60 | ||||
Unrecognized compensation cost for non-vested options | $ 2,915,970 | $ 8,211,896 | ||||
Period for recognition | 1 year 11 months 27 days | 2 years 9 months 22 days | ||||
Restricted Stock Units | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Period for recognition | 2 years 10 months 10 days | 1 day | ||||
Unrecognized compensation related to stock units | $ 689,365 | $ 4,430 | ||||
Fair value of equity instruments vested in period | $ 1,291,878 | $ 405,550 | ||||
Granted (in USD per share) | $ 1.59 | $ 4.06 | ||||
Restricted Stock | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Fair value of equity instruments vested in period | $ 596,314 | |||||
Granted (in USD per share) | $ 0.80 | |||||
Equity Incentive Plan 2014 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Shares reserved (in shares) | 5,000,000 | 9,500,000 | 7,500,000 | 2,500,000 | ||
Additional shares authorized (in shares) | 2,500,000 | |||||
Equity Incentive 2014 Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Shares available for issuance (in shares) | 3,436,788 |
Stock-Based Compensation - Rest
Stock-Based Compensation - Restricted Stock Units (Details) - Restricted Stock Units - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Number of Shares | |||
Beginning balance (in shares) | 272,000 | 0 | |
Granted (in shares) | 2,249,242 | 402,000 | |
Released (in shares) | (372,487) | (95,000) | |
Forfeited (in shares) | (874,453) | (35,000) | |
Ending balance (in shares) | 1,274,302 | 272,000 | |
Weighted Average Grant Date Fair Value Per Share | |||
Beginning weighted average grant date fair value (in USD per share) | $ 1.43 | $ 3.99 | |
Granted (in USD per share) | 1.59 | 4.06 | |
Released (in USD per share) | 3.47 | 4.27 | |
Forfeitures (in USD per share) | 1.75 | 3.99 | |
Ending weighted average grant date fair value (in USD per share) | $ 3.99 | $ 0 | |
Intrinsic value, outstanding | $ 391,848 | $ 571,200 | $ 0 |
Derivative Financial Instrume50
Derivative Financial Instruments - Warrants (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Changes in the Company's derivative financial instruments liability balance | ||
Balance of warrants outstanding at the beginning of the period (in shares) | 5,505,901 | 5,533,242 |
Warrants granted (in shares) | 19,643,626 | 30,992 |
Balance of warrants outstanding at the end of the period (in shares) | 23,238,853 | 5,505,901 |
Balance of derivative financial instruments liability at the beginning of the period | $ 834,940 | |
Change in fair value of warrants during the period recognized as a gain in the condensed consolidated statement of operations | (3,401,072) | $ (2,462,137) |
Balance of derivative financial instruments liability at the end of the period | $ 649,387 | $ 834,940 |
Warrants to purchase Common stock | ||
Changes in the Company's derivative financial instruments liability balance | ||
Weighted average remaining contractual life | 4 years 4 months 10 days | 2 years |
Warrants to purchase Common stock | Black Scholes Option Pricing Method | ||
Range of assumptions used to determine the fair value of warrants | ||
Dividend yield (as a percent) | 0.00% | 0.00% |
Changes in the Company's derivative financial instruments liability balance | ||
Balance of warrants outstanding at the beginning of the period (in shares) | 967,295 | 967,295 |
Warrants granted (in shares) | 4,643,626 | |
Balance of warrants outstanding at the end of the period (in shares) | 5,610,921 | 967,295 |
Balance of derivative financial instruments liability at the beginning of the period | $ 834,940 | $ 3,297,077 |
Issuance of Derivative Financial Instruments | 3,215,519 | |
Change in fair value of warrants during the period recognized as a gain in the condensed consolidated statement of operations | (3,401,072) | (2,462,137) |
Balance of derivative financial instruments liability at the end of the period | $ 649,387 | $ 834,940 |
Warrants to purchase Common stock | Black Scholes Option Pricing Method | Minimum | ||
Range of assumptions used to determine the fair value of warrants | ||
Estimated fair value of Trovagene common stock (in dollars per share) | $ 0.31 | $ 2.10 |
Expected warrant term | 1 year | 2 years |
Risk-free interest rate (as a percent) | 1.27% | 0.71% |
Expected volatility (as a percent) | 86.00% | 82.00% |
Warrants to purchase Common stock | Black Scholes Option Pricing Method | Maximum | ||
Range of assumptions used to determine the fair value of warrants | ||
Estimated fair value of Trovagene common stock (in dollars per share) | $ 1.26 | $ 4.65 |
Expected warrant term | 5 years 6 months | 2 years 9 months |
Risk-free interest rate (as a percent) | 2.21% | 1.20% |
Expected volatility (as a percent) | 116.00% | 94.00% |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) | Dec. 31, 2017 | Dec. 31, 2016 |
Liabilities: | ||
Derivative financial instruments—warrants | $ 649,387 | $ 834,940 |
Estimate of Fair Value Measurement | ||
Assets: | ||
Short-term Investments | 23,978,022 | |
Recurring basis | Estimate of Fair Value Measurement | ||
Assets: | ||
Money market fund | 4,522,631 | 12,095,620 |
Total Assets | 4,522,631 | 37,272,146 |
Liabilities: | ||
Derivative financial instruments—warrants | 649,387 | 834,940 |
Total Liabilities | 649,387 | 834,940 |
Recurring basis | Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1) | Estimate of Fair Value Measurement | ||
Assets: | ||
Money market fund | 4,522,631 | 12,095,620 |
Total Assets | 4,522,631 | 12,095,620 |
Liabilities: | ||
Derivative financial instruments—warrants | 0 | 0 |
Total Liabilities | 0 | 0 |
Recurring basis | Significant Other Observable Inputs (Level 2) | Estimate of Fair Value Measurement | ||
Assets: | ||
Money market fund | 0 | 0 |
Total Assets | 0 | 25,176,526 |
Liabilities: | ||
Derivative financial instruments—warrants | 0 | 0 |
Total Liabilities | 0 | 0 |
Recurring basis | Significant Unobservable Inputs (Level 3) | Estimate of Fair Value Measurement | ||
Assets: | ||
Money market fund | 0 | 0 |
Total Assets | 0 | 0 |
Liabilities: | ||
Derivative financial instruments—warrants | 649,387 | 834,940 |
Total Liabilities | 649,387 | 834,940 |
Corporate debt securities | Estimate of Fair Value Measurement | ||
Assets: | ||
Short-term Investments | 14,160,686 | |
Corporate debt securities | Recurring basis | Estimate of Fair Value Measurement | ||
Assets: | ||
Short-term Investments | 14,160,686 | |
Corporate debt securities | Recurring basis | Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1) | Estimate of Fair Value Measurement | ||
Assets: | ||
Short-term Investments | 0 | |
Corporate debt securities | Recurring basis | Significant Other Observable Inputs (Level 2) | Estimate of Fair Value Measurement | ||
Assets: | ||
Short-term Investments | 14,160,686 | |
Corporate debt securities | Recurring basis | Significant Unobservable Inputs (Level 3) | Estimate of Fair Value Measurement | ||
Assets: | ||
Short-term Investments | 0 | |
Commercial paper | Estimate of Fair Value Measurement | ||
Assets: | ||
Short-term Investments | 1,195,444 | |
Commercial paper | Recurring basis | Estimate of Fair Value Measurement | ||
Assets: | ||
Short-term Investments | 2,393,948 | |
Commercial paper | Recurring basis | Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1) | Estimate of Fair Value Measurement | ||
Assets: | ||
Short-term Investments | 0 | |
Commercial paper | Recurring basis | Significant Other Observable Inputs (Level 2) | Estimate of Fair Value Measurement | ||
Assets: | ||
Short-term Investments | 2,393,948 | |
Commercial paper | Recurring basis | Significant Unobservable Inputs (Level 3) | Estimate of Fair Value Measurement | ||
Assets: | ||
Short-term Investments | 0 | |
U.S. treasury securities | Estimate of Fair Value Measurement | ||
Assets: | ||
Short-term Investments | 8,621,892 | |
U.S. treasury securities | Recurring basis | Estimate of Fair Value Measurement | ||
Assets: | ||
Short-term Investments | 8,621,892 | |
U.S. treasury securities | Recurring basis | Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1) | Estimate of Fair Value Measurement | ||
Assets: | ||
Short-term Investments | 0 | |
U.S. treasury securities | Recurring basis | Significant Other Observable Inputs (Level 2) | Estimate of Fair Value Measurement | ||
Assets: | ||
Short-term Investments | 8,621,892 | |
U.S. treasury securities | Recurring basis | Significant Unobservable Inputs (Level 3) | Estimate of Fair Value Measurement | ||
Assets: | ||
Short-term Investments | $ 0 | |
Cash and Cash Equivalents | Commercial paper | Recurring basis | Significant Other Observable Inputs (Level 2) | ||
Assets: | ||
Short-term Investments | $ 1,198,504 |
Fair Value Measurements (Deta52
Fair Value Measurements (Details 2) - Warrants to purchase Common stock - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Reconciliation of the beginning and ending balances | ||
Balance at the beginning of the period | $ 834,940 | $ 3,297,077 |
Issuance of Derivative Financial Instruments | 3,215,519 | |
Unrealized (gains) or losses | (3,401,072) | (2,462,137) |
Balance at the end of the period | $ 649,387 | $ 834,940 |
Debt - Equipment Line of Credit
Debt - Equipment Line of Credit (Details) - USD ($) | 1 Months Ended | 12 Months Ended |
Nov. 30, 2015 | Dec. 31, 2017 | |
Line of Credit Facility [Line Items] | ||
Amounts due under current line of credit | $ 1,331,515 | |
Line of Credit | ||
Line of Credit Facility [Line Items] | ||
Maximum borrowing capacity for line of credit | $ 2,000,000 | |
Interest rate at end of period | 5.75% | |
Line of credit facility period for principal and interest payments after date of advance | 36 months | |
Repayment of total amounts borrowed as a percent | 7.00% | |
Interest expenses recorded | $ 232,765 | |
Prime Rate | Line of Credit | ||
Line of Credit Facility [Line Items] | ||
Interest rate above reference rate | 1.25% |
Debt - Loan and Security Agreem
Debt - Loan and Security Agreement (Details) | Jun. 06, 2017USD ($) | Jul. 20, 2016$ / sharesshares | Jun. 30, 2017USD ($) | Nov. 30, 2015 | Jun. 30, 2014USD ($)intangible_assetshares | Dec. 31, 2017USD ($)shares | Jun. 30, 2015$ / sharesshares |
Secured Debt | |||||||
Debt | |||||||
Number of common shares that can be purchased upon exercise of warrant | shares | 42,735 | 30,992 | 73,727 | ||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 4.84 | ||||||
Warrant exercisable term | 10 years | ||||||
Payment for debt extinguishment | $ 16,668,583 | ||||||
Prepayment fee | $ 450,000 | ||||||
Less discount | 400,562 | ||||||
Unamortized portion of final fee upon repayment | $ 738,196 | ||||||
Interest expenses recorded | $ 801,173 | ||||||
Loan and Security Agreement | |||||||
Debt | |||||||
Interest expenses recorded | $ 232,765 | ||||||
Loan and Security Agreement | Secured Debt | |||||||
Debt | |||||||
Face value of term loan | $ 15,000,000 | ||||||
Number of banks with which agreement is entered | intangible_asset | 2 | ||||||
Number of common shares that can be purchased upon exercise of warrant | shares | 85,470 | ||||||
Exercise price of warrants (in dollars per share) | $ / shares | $ 3.51 | ||||||
Exercisable term | 10 years | ||||||
Loan and Security Agreement | Secured Debt | Minimum | |||||||
Debt | |||||||
Interest rate (as a percent) | 7.25% | ||||||
Prime Rate | Loan and Security Agreement | |||||||
Debt | |||||||
Interest rate above reference rate | 1.25% | ||||||
Prime Rate | Loan and Security Agreement | Secured Debt | |||||||
Debt | |||||||
Interest rate above reference rate | 3.75% |
Income Taxes - Narrative (Deta
Income Taxes - Narrative (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Operating loss carryforwards (NOLs) | ||
Tax rate change | $ 21,454,000 | $ 0 |
Interest and/or penalties incurred | 0 | |
Federal | ||
Operating loss carryforwards (NOLs) | ||
NOLs | 130,500,000 | |
Tax rate change | 19,500,000 | |
California Franchise Tax Board | ||
Operating loss carryforwards (NOLs) | ||
NOLs | 72,100,000 | |
R&D credits | Federal | ||
Operating loss carryforwards (NOLs) | ||
Tax credits | 2,000,000 | |
R&D credits | California Franchise Tax Board | ||
Operating loss carryforwards (NOLs) | ||
Tax credits | $ 1,100,000 |
Income Taxes - Provision for I
Income Taxes - Provision for Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Current: | |||
State | $ 1 | $ 0 | |
Total current provision | 1 | $ 0 | |
Deferred: | |||
Federal | $ 9,781 | (14,035) | |
State | 3,171 | (2,443) | |
Foreign | 0 | (114) | |
Total deferred expense (benefit) | 12,952 | (16,592) | |
Valuation allowance | (12,953) | 16,592 | |
Total income tax provision | $ 0 | $ 0 |
Income Taxes - Significant Com
Income Taxes - Significant Components of Company's Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Effective Income Tax Rate Reconciliation, Amount [Abstract] | ||
Tax computed at the federal statutory rate | $ (8,591) | $ (13,206) |
State tax, net of federal tax benefit | (697) | (2,286) |
Foreign tax | 0 | (114) |
Permanent Items | (706) | (114) |
Tax credits | (431) | (1,276) |
Valuation allowance increase | (11,029) | 16,996 |
Tax rate change | 21,454 | 0 |
Provision for income taxes | $ 0 | $ 0 |
Effective Income Tax Rate Reconciliation, Percent [Abstract] | ||
Tax computed at the federal statutory rate | 34.00% | 34.00% |
State tax, net of federal tax benefit | 3.00% | 6.00% |
Foreign tax | 0.00% | 0.00% |
Permanent Items | 3.00% | 0.00% |
Tax credits | 2.00% | 3.00% |
Valuation allowance increase | 43.00% | (43.00%) |
Tax rate change | (85.00%) | 0.00% |
Provision for income taxes | 0.00% | 0.00% |
Income Taxes - Significant C58
Income Taxes - Significant Components of Deferred Tax Assets and Liabilities(Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Deferred tax assets: | ||
Tax loss carryforwards | $ 29,713 | $ 41,502 |
Research and development credits and other tax credits | 3,084 | 2,817 |
Stock-based compensation | 3,565 | 4,658 |
Other | 945 | 1,283 |
Total deferred tax assets | 37,307 | 50,260 |
Valuation allowance | (37,307) | (50,260) |
Net deferred tax asset | $ 0 | $ 0 |
Commitments and Contingencies
Commitments and Contingencies - Research and Development and Clinical Trial Agreements and Collaborative Arrangement (Details) - Norviano $ in Millions | 12 Months Ended |
Dec. 31, 2017USD ($) | |
Loss Contingencies [Line Items] | |
Licensing and distribution rights commitment | $ 1 |
Licensing Agreements | |
Loss Contingencies [Line Items] | |
Research and development expense | $ 2 |
Commitments and Contingencies60
Commitments and Contingencies - Litigation (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2017USD ($)defendant | |
Loss Contingencies [Line Items] | |
Estimated litigation liability | $ 2,100 |
Former CEO and CFO | |
Loss Contingencies [Line Items] | |
Number of defendants | defendant | 2 |
Amount awarded to other party | $ 975 |
Commitments and Contingencies61
Commitments and Contingencies - Lease Agreements (Details) | Jun. 11, 2015USD ($)ft² | Nov. 30, 2015USD ($)ft² | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) |
Commitments and Contingencies Disclosure [Abstract] | ||||
Square footage of leased space | ft² | 26,100 | 2,300 | ||
Monthly lease rent | $ 68,000 | $ 3,100 | ||
Rent expense | $ 663,000 | $ 602,000 |
Commitments and Contingencies62
Commitments and Contingencies - Non-Cancelable Lease Agreements (Details) | Dec. 31, 2017USD ($) |
Operating Leases | |
2,018 | $ 881,815 |
2,019 | 906,879 |
2,020 | 931,457 |
2,021 | 959,401 |
2,022 | 0 |
Thereafter | 0 |
Total | 3,679,552 |
Sublease Income | |
2,018 | (216,504) |
2,019 | (183,124) |
2,020 | 0 |
2,021 | 0 |
2,022 | 0 |
Total | 0 |
Total | (399,628) |
Net Operating Leases | |
2,018 | 665,311 |
2,019 | 723,755 |
2,020 | 931,457 |
2,021 | 959,401 |
2,022 | 0 |
Thereafter | 0 |
Total | $ 3,279,924 |
Commitments and Contingencies63
Commitments and Contingencies - Public Offering and Controlled Equity Offering and Database Usage (Details) - USD ($) | Jan. 25, 2013 | Dec. 31, 2017 | Mar. 15, 2017 |
Other Commitments [Line Items] | |||
Proceeds from the sale of common stock | $ 100,000 | ||
Maximum | Public Offering and Controlled Equity Offering | |||
Other Commitments [Line Items] | |||
Aggregate initial offering price | $ 20,698,357 | ||
Selling Agents | Public Offering and Controlled Equity Offering | |||
Other Commitments [Line Items] | |||
Commission as a percentage of gross proceeds | 3.00% | ||
Selling Agents | Maximum | Public Offering and Controlled Equity Offering | |||
Other Commitments [Line Items] | |||
Aggregate initial offering price | $ 30,000,000 |
Employee Benefit Plan (Details)
Employee Benefit Plan (Details) | 12 Months Ended |
Dec. 31, 2017 | |
Defined Contribution Plan | |
Threshold age to be eligible to make catch-up contributions to the plan per IRS code | 50 years |
Restructuring Charges (Details)
Restructuring Charges (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Restructuring Cost and Reserve [Line Items] | ||
Restructuring charges | $ 2,174,251 | $ 790,438 |
Allocated stock-based compensation | (4,012,585) | $ (7,504,316) |
Restructuring Reserve | 262,000 | |
Employee Severance | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring charges | 1,100,000 | |
Allocated stock-based compensation | 125,000 | |
Impaired Long-Lived Assets | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring charges | $ 485,000 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Other Affiliates | ||
Related Party Transaction [Line Items] | ||
Legal fees | $ 650,000 | $ 537,000 |
Selected Quarterly Financial 67
Selected Quarterly Financial Data (Unaudited) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | |
Quarterly Financial Data [Abstract] | ||||||||||
Revenues | $ 185,000 | $ 123,000 | $ 102,000 | $ 95,000 | $ 68,000 | $ 89,000 | $ 104,000 | $ 120,000 | $ 505,404 | $ 381,072 |
Operating expenses | 3,969,000 | 5,921,000 | 5,990,000 | 10,221,000 | 9,850,000 | 10,013,000 | 10,084,000 | 10,579,000 | 26,101,201 | 40,526,683 |
Net loss attributable to common stockholders | $ (2,576,000) | $ (4,298,000) | $ (8,052,000) | $ (10,005,000) | $ (8,554,000) | $ (10,197,000) | $ (10,208,000) | $ (10,269,000) | $ (24,930,984) | $ (39,227,959) |
Net loss per common share - basic (in dollars per share) | $ (0.06) | $ (0.12) | $ (0.26) | $ 0.32 | $ (0.28) | $ (0.34) | $ (0.34) | $ (0.35) | $ (0.72) | $ (1.30) |
Net loss per common share - diluted (in dollars per share) | $ (0.06) | $ (0.12) | $ (0.26) | $ (0.32) | $ (0.34) | $ (0.34) | $ (0.34) | $ (0.36) | $ (0.72) | $ (1.37) |
Shares used in the calculation of net loss attributable to common stockholders - basic (in shares) | 40,182,071 | 36,465,672 | 30,991,740 | 30,961,014 | 30,639,440 | 30,339,774 | 29,958,037 | 29,755,184 | 34,680,362 | 30,174,838 |
Shares used in the calculation of net loss attributable to common stockholders - diluted (in shares) | 40,182,071 | 36,465,672 | 30,991,740 | 30,961,014 | 30,711,946 | 30,339,774 | 29,958,037 | 30,108,377 | 34,680,362 | 30,281,263 |