Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2020 | May 13, 2020 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | Aikido Pharma Inc. | |
Entity Central Index Key | 0000012239 | |
Document Type | 10-Q | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2020 | |
Entity File Number | 000-05576 | |
Entity Reporting Status Current | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 34,920,219 | |
Entity Incorporation, State or Country Code | DE |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Current assets | ||
Cash and cash equivalents | $ 252 | $ 91 |
Marketable securities | 16,141 | 857 |
Prepaid expenses and other assets | 165 | 181 |
Total current assets | 16,558 | 1,129 |
Investments | 5,032 | 10,153 |
Total assets | 21,590 | 11,282 |
Current liabilities | ||
Accounts payable and accrued expenses | 177 | 68 |
Accrued salaries and benefits | 438 | 682 |
Total current liabilities | 615 | 750 |
Total liabilities | 615 | 750 |
Stockholders' equity | ||
Common stock, $0.0001 par value, 100,000,000 shares authorized; 20,857,912 and 4,825,552 shares issued at March 31, 2020 and December 31, 2019, respectively; 20,857,909 and 4,825,549 shares outstanding at March 31, 2020 and December 31, 2019, respectively | 2 | |
Additional paid-in-capital | 173,836 | 155,062 |
Treasury stock, at cost, 3 shares at March 31, 2020 and December 31, 2019 | (264) | (264) |
Accumulated deficit | (152,599) | (144,266) |
Total stockholders' equity | 20,975 | 10,532 |
Total liabilities and stockholders' equity | 21,590 | 11,282 |
Series D Preferred Stock | ||
Stockholders' equity | ||
Preferred Stock | ||
Series D-1 Preferred Stock | ||
Stockholders' equity | ||
Preferred Stock |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2020 | Dec. 31, 2019 |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, authorized | 100,000,000 | 100,000,000 |
Common stock, issued | 20,857,912 | 20,857,909 |
Common stock, outstanding | 4,825,549 | 4,825,549 |
Treasury stock | 3 | 3 |
Series D Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, issued | 4,725 | 4,725 |
Preferred stock, outstanding | 4,725 | 4,725 |
liquidation preference | $ 0.0001 | $ 0.0001 |
Series D-1 Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, issued | 834 | 834 |
Preferred stock, outstanding | 834 | 834 |
liquidation preference | $ 0.0001 | $ 0.0001 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Operating costs and expenses | ||
General and administrative | $ 1,303 | $ 713 |
Research and development | 85 | |
Research and development - license acquired | 1,011 | |
Total operating expenses | 2,399 | 713 |
Loss from operations | (2,399) | (713) |
Other expenses | ||
Gains and (losses) on marketable securities | (863) | 92 |
Change in fair value of investment | (5,071) | (475) |
Change in fair value of warrant liabilities | (53) | |
Total other expenses | (5,934) | (436) |
Net loss | $ (8,333) | $ (1,149) |
Net loss per share, basic and diluted | ||
Basic and Diluted | $ (0.91) | $ (0.57) |
Weighted average number of shares outstanding, basic and diluted | ||
Basic and Diluted | 9,195,594 | 2,010,025 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Stockholders' Equity (Unaudited) - USD ($) $ in Thousands | Common Stock | Preferred Stock | Additional Paid-in Capital | Treasury Stock | Accumulated Deficit | Total |
Balance at Dec. 31, 2018 | $ 152,445 | $ (264) | $ (140,083) | $ 12,098 | ||
Balance , shares at Dec. 31, 2018 | 2,010,025 | 5,559 | 3 | |||
Stock-based compensation | 6 | 6 | ||||
Net loss | (1,149) | (1,149) | ||||
Balance at Mar. 31, 2019 | 173,836 | $ (264) | (152,599) | 20,975 | ||
Balance, shares at Mar. 31, 2019 | 2,010,025 | 5,559 | 3 | |||
Balance at Dec. 31, 2019 | 155,062 | $ (264) | (144,266) | 10,532 | ||
Balance , shares at Dec. 31, 2019 | 4,825,549 | 5,559 | 3 | |||
Issuance of common stock and prefunded common stock warrants, net of offering cost | $ 1 | 6,541 | 6,542 | |||
Issuance of common stock and prefunded common stock warrants, net of offering cost, shares | 3,245,745 | |||||
Issuance of common stock, net of offering cost / At-the-market offering | 5,095 | 5,095 | ||||
Issuance of common stock, net of offering cost / At-the-market offering , shares | 2,090,909 | |||||
Common warrant and prefunded warrant exercise | $ 1 | 7,138 | 7,139 | |||
Common warrant and prefunded warrant exercise, shares | 10,695,706 | |||||
Net loss | (8,333) | (8,333) | ||||
Balance at Mar. 31, 2020 | $ 2 | $ 173,836 | $ (264) | $ (152,599) | $ 20,975 | |
Balance, shares at Mar. 31, 2020 | 20,857,909 | 5,559 | 3 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Cash flows from operating activities | ||
Net loss | $ (8,333) | $ (1,149) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Change in fair value of investment | 5,071 | 475 |
Change in fair value of warrant liabilities | 53 | |
Research and development-acquired license, expensed | 1,011 | |
Stock-based compensation | 6 | |
Realized loss on marketable securities | 44 | 73 |
Unrealized loss (gain) on marketable securities | 835 | (148) |
Changes in assets and liabilities: | ||
Prepaid expenses and other assets | 16 | 18 |
Accounts payable and accrued expenses | 102 | (10) |
Accrued salaries and benefits | (244) | (84) |
Payable to DatChat | 50 | (130) |
Net cash used in operating activities | (1,448) | (896) |
Cash flows from investing activities | ||
Purchase of marketable securities | (20,378) | (2,845) |
Sale of marketable securities | 4,215 | 4,365 |
Purchase of investments at fair value | (200) | |
Purchase of research and development licenses | (1,011) | |
Net cash (used in) provided by investing activities | (17,174) | 1,320 |
Cash flows from financing activities | ||
Proceeds from issuance common stock, common warrants and prefunded warrants, net of offering cost | 6,549 | |
Proceeds from issuance common stock, net of offering cost | 5,095 | |
Proceeds from exercise of warrants | 7,139 | |
Net cash provided by financing activities | 18,783 | |
Net increase in cash and cash equivalents | 161 | 424 |
Cash and cash equivalents, beginning of period | 91 | 22 |
Cash and cash equivalents, end of period | 252 | 446 |
Non-cash investing and financing activities | ||
Offering cost included in accrued expenses | $ 7 |
Organization and Description of
Organization and Description of Business | 3 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Description of Business | Note 1. Organization and Description of Business Organization and Description of Business AIkido Pharma Inc., formerly known as Spherix Incorporated (the "Company"), was initially formed in 1967 and is currently a biotechnology company with a diverse portfolio of small-molecule anti-cancer therapeutics in development. The Company's platform consists of patented technology from leading universities and researchers and we are currently in the process of developing an innovative therapeutic drug platform through partnerships with educational institutions, including the University of Texas at Austin, the University of Maryland, Baltimore and Wake Forest University. The Company's diverse pipeline of therapeutics includes therapies for pancreatic cancer, acute myeloid leukemia (AML) and acute lymphoblastic leukemia (ALL). The Company is also developing a broad spectrum antiviral platform that may potentially inhibit replication of multiple viruses including Influenza virus, SARS-CoV (coronavirus), MERS-CoV, Ebolavirus and Marburg virus. The Company previously focused its efforts on owning, developing, acquiring and monetizing intellectual property assets. Since May 2016, the Company has received limited funds from its intellectual property monetization. In addition to its patent monetization efforts, since the fourth quarter of 2017, the Company has been transitioning to focus its efforts as a technology and biotechnology development company. These efforts have focused on biotechnology research and blockchain technology research. The Company's investment in biotechnology research development includes: (i) an investment in Hoth Therapeutics Inc. ("Hoth"), a development stage biopharmaceutical company focused on unique targeted therapeutics for patients suffering from indications such as atopic dermatitis, also known as eczema, (ii) an investment in DatChat, Inc. ("DatChat"), a privately held personal privacy platform focused on encrypted communication, internet security and digital rights management, and (iii) the acquisition of assets of CBM BioPharma, Inc. ("CBM"), a pharmaceutical company focusing on the development of cancer treatments. During the 1st quarter of 2020, the Company raised over $2.0 million of proceeds (see Note 8), therefore a payment of $1.0 million was due to CBM under the CBM purchase agreement (the "CBM Purchase Agreement"). The Company recorded this payment to CBM as a component of research and development license acquired during the three months ended March 31, 2020 the condensed consolidated statements of operations. As a result of the Company's biotechnology research development and associated investments and acquisitions, the Company's business portfolio now focuses on the treatment of three different cancers, including pancreatic cancer, acute myeloid leukemia (AML) and acute lymphoblastic leukemia (ALL). The Company's AML and ALL compounds, developed at the Wake Forest University, are targeted therapeutics designed to overcome multiple resistance mechanisms observed with the current standard of care. DHA-dFdC, the Company's pancreatic drug candidate developed at the University of Texas at Austin, is a new compound that the Company hopes will become the next generation of chemotherapy treatment for advanced pancreatic cancer. DHA-dFdC overcomes tumor cell resistance to current chemotherapeutic drugs and is well tolerated in preclinical toxicity tests. Preclinical studies have also indicated that DHA-dFdC inhibits pancreatic cancer cell growth (up to 100,000-fold more potent that gemcitabine, a current standard therapy), has documented efficacy against pancreatic tumors in a clinically relevant transgenic mouse model and has demonstrated activities against other cancers, including leukemia, lung and melanoma. In addition, the Company is constantly seeking to grow its pipe to treat unmet medical needs in oncology. In addition, the Company owns an exclusive world-wide license to patented technology from the University of Maryland Baltimore ("UMB"). The Company's license is for a broad spectrum antiviral drug platform. The licensed technology is a broadly acting pan-viral inhibitory compound with efficacy against multiple viral pathogens. The technology works to inhibit replication of multiple viruses including Influenza virus, SARS-CoV (coronavirus), MERS-CoV, Ebolavirus and Marburg virus. The technology is covered by two patent applications already on file with the United States Patent and Trademark Office. The UMB inventors are Drs. Matthew Frieman, Alexander MacKerell and Stuart Watson. The Company has also executed a Sponsored Research Agreement with UMB to support the development of the technology. |
Liquidity and Capital Resources
Liquidity and Capital Resources | 3 Months Ended |
Mar. 31, 2020 | |
Liquidity And Capital Resources | |
Liquidity and Capital Resources | Note 2. Liquidity and Capital Resources The Company continues to incur ongoing administrative and other expenses, including public company expenses, in excess of corresponding (non-financing related) revenue. While the Company continues to implement its business strategy, it intends to finance its activities through: ● managing current cash, cash equivalents and marketable securities on hand from the Company's past debt and equity offerings, ● seeking additional funds raised through the sale of additional securities in the future, ● seeking additional liquidity through credit facilities or other debt arrangements, and ● increasing revenue from its patent portfolios, license fees and new business ventures. The Company's ultimate success is dependent on its ability to obtain additional financing and generate sufficient cash flow to meet its obligations on a timely basis. The Company's business will require significant amounts of capital to sustain operations and make the investments it needs to execute its longer-term business plan to support new technologies and help advance innovation. Absent generation of sufficient revenue from the execution of the Company's long-term business plan, the Company will need to obtain additional debt or equity financing, especially if the Company experiences downturns in its business that are more severe or longer than anticipated, or if the Company experiences significant increases in expense levels resulting from being a publicly-traded company or operations. If the Company attempts to obtain additional debt or equity financing, the Company cannot assume that such financing will be available to the Company on favorable terms, or at all. The Company plans to pursue its plans regarding research and development which will require resources beyond those currently available, including third party capital. During this time, the Company does not expect to generate revenue as there is substantial doubt about the Company's ability to continue as a going concern within one year from the date of this filing. The condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern, and do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets, or the amounts and classification of liabilities that may result from the outcome of this uncertainty. In addition to the foregoing, based on the Company's current assessment, the Company does not expect any material impact on its long-term development timeline and its liquidity due to the worldwide spread of the COVID-19 virus. However, the Company is continuing to assess the effect on its operations by monitoring the spread of COVID-19 and the actions implemented to combat the virus throughout the world. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Note 3. Summary of Significant Accounting Policies Basis of Presentation and Principles of Consolidation The accompanying unaudited condensed consolidated interim financial statements include the accounts of the Company and its subsidiaries. All material intercompany balances and transactions have been eliminated. Certain immaterial reclassifications have been made to prior period amounts to conform to the current period presentation. The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with the accounting principles generally accepted in the United States of America ("U.S. GAAP") for interim financial information and pursuant to the instructions to Form 10-Q and Article 8 of Regulation S-X of the Securities and Exchange Commission ("SEC") and on the same basis as the Company prepares its annual audited consolidated financial statements. The condensed consolidated balance sheet as of March 31, 2020, condensed consolidated statements of operations for the three months ended March 31, 2020 and 2019, condensed consolidated statement of stockholders' equity for the three months ended March 31, 2020 and 2019, and the condensed consolidated statements of cash flows for the three months ended March 31, 2020 and 2019 are unaudited, but include all adjustments, consisting only of normal recurring adjustments, which the Company considers necessary for a fair presentation of the financial position, operating results and cash flows for the periods presented. The results for the three months ended March 31, 2020 are not necessarily indicative of results to be expected for the year ending December 31, 2020 or for any future interim period. The condensed consolidated balance sheet at December 31, 2019 has been derived from audited financial statements; however, it does not include all of the information and notes required by U.S. GAAP for complete financial statements. The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements for the year ended December 31, 2019 and notes thereto included in the Company's annual report on Form 10-K, which was filed with the SEC on February 3, 2020. Use of Estimates The accompanying condensed consolidated financial statements have been prepared in conformity with US GAAP. This requires management to make estimates and assumptions that affect certain reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements, and the reported expenses during the period. The Company's significant estimates and assumptions include the valuation of investments and the valuation allowance related to the Company's deferred tax assets. Certain of the Company's estimates, including the carrying amount of its investments, could be affected by external conditions, including those unique to the Company and general economic conditions. It is reasonably possible that these external factors could have an effect on the Company's estimates and could cause actual results to differ from those estimates and assumptions. Significant Accounting Policies Other than as described below, there have been no material changes in the Company's significant accounting policies to those previously disclosed in the Company's annual report on Form 10-K, which was filed with the SEC on February 3, 2020. Net Income Loss per Share Basic loss per share is computed by dividing the net income or loss applicable to common shares by the weighted average number of common shares outstanding during the period. Net loss attributable to common stockholders includes the effect of the deemed capital contribution on extinguishment of preferred stock and the deemed dividend related to the immediate accretion of beneficial conversion feature of convertible preferred stock. Diluted earnings per share is computed using the weighted average number of common shares and, if dilutive, potential common shares outstanding during the period. Potential common shares consist of the incremental common shares issuable upon the exercise of stock options (using the treasury stock method) and the conversion of the Company's convertible preferred stock and warrants (using the if-converted method). Diluted loss per share excludes the shares issuable upon the conversion of preferred stock and the exercise of stock options and warrants from the calculation of net loss per share if their effect would be anti-dilutive. Recently Adopted Accounting Standards In August 2018, the Financial Accounting Standards Board ("FASB") issued ASU 2018-13, " Fair Value Measurement |
Investments in Marketable Secur
Investments in Marketable Securities | 3 Months Ended |
Mar. 31, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |
Investments in Marketable Securities | Note 4. Investments in Marketable Securities The realized gain or loss, unrealized gain or loss, and dividend income related to marketable securities for the three months ended March 31, 2020 and 2019, which are recorded as a component of gains and (losses) on marketable securities on the consolidated statements of operations, are as follows ($ in thousands): For the Three Months Ended 2020 2019 Realized loss $ (44 ) $ (73 ) Unrealized (loss) gain (835 ) 148 Dividend income 13 17 Interest income 4 - $ (863 ) $ 92 |
Investment in Hoth Therapeutics
Investment in Hoth Therapeutics, Inc. | 3 Months Ended |
Mar. 31, 2020 | |
Investment in Hoth Therapeutics, Inc. [Abstract] | |
Investment in Hoth Therapeutics, Inc. | Note 5. Investment in Hoth Therapeutics, Inc . The following summarizes the Company investment in Hoth as of March 31, 2020: Security Name Shares Owned as of Fair value per Share Fair value as of HOTH 1,636,230 $ 3.06 $ 5,007 The fair value of Hoth common shares as of March 31, 2020 was based on the closing price of $3.06 reported on The Nasdaq Capital Market as of March 31, 2020. |
Investment in Others
Investment in Others | 3 Months Ended |
Mar. 31, 2020 | |
Investment in Others [Abstract] | |
Investment in Others | Note 6. Investment in Others In May 2019, the Company purchased (a) a senior convertible note issued by DatChat with outstanding principal of $300,000, with an initial conversion rate of $0.20 per share, (b) a warrant to purchase 2,250,000 shares of DatChat common stock at an initial exercise price of $0.20 per share, (c) an option to acquire an additional $300,000 senior convertible note and a warrant to purchase 1,500,000 shares of DatChat common stock, (d) a contingent option to purchase 500,000 shares of DatChat common stock from an existing DatChat stockholder, (e) a contingent option to put 200,000 shares of DatChat common stock and (f) 50,000 shares of common stock of CBM which represents a 20% interest in CBM. The Company allocated all the fair value of this investment to CBM. As a result of the nominal purchase price allocated to DatChat, the Company reviewed its existing holdings in DatChat and reduced its existing carrying amount from $1.0 million to $0. The Company recorded its initial investment in DatChat on adjusted cost method measurement alternative in accordance with ASU 2016-01. The balance of Company's other investments is $25,000 as of December 31, 2019. Such investments were recorded on adjusted cost method measurement alternative in accordance with ASU 2016-01. |
Fair Value of Financial Assets
Fair Value of Financial Assets and Liabilities | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Assets and Liabilities | Note 6. Fair Value of Financial Assets and Liabilities Financial instruments, including cash and cash equivalents, accounts payable and accrued liabilities are carried at cost, which management believes approximates fair value due to the short-term nature of these instruments. The Company measures the fair value of financial assets and liabilities based on the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The Company maximizes the use of observable inputs and minimizes the use of unobservable inputs when measuring fair value. The Company uses three levels of inputs that may be used to measure fair value: Level 1 - quoted prices in active markets for identical assets or liabilities Level 2 - quoted prices for similar assets and liabilities in active markets or inputs that are observable Level 3 - inputs that are unobservable (for example, cash flow modeling inputs based on assumptions) The following table presents the Company's assets and liabilities that are measured at fair value at March 31, 2020 and December 31, 2019 ($ in thousands): Fair value measured at March 31, 2020 Total at March 31, Quoted prices in Significant other Significant unobservable 2020 (Level 1) (Level 2) (Level 3) Assets Marketable securities - mutual and exchange traded funds $ 16,141 $ 16,141 $ - $ - Investments in Hoth $ 5,007 $ 5,007 $ - $ - Fair value measured at December 31, 2019 Total at Quoted prices in Significant other Significant unobservable 2019 (Level 1) (Level 2) (Level 3) Assets Marketable securities - mutual and exchange traded funds $ 857 $ 857 $ - $ - Investments in Hoth $ 10,128 $ 10,128 $ - $ - |
Net Loss per Share
Net Loss per Share | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Net Loss per Share | Note 7. Net Loss per Share Securities that could potentially dilute loss per share in the future that were not included in the computation of diluted loss per share at March 31, 2020 and 2019 are as follows: As of As of March 31, 2020 2019 Convertible preferred stock 688 688 Warrants to purchase common stock 796,811 285,273 Options to purchase common stock 88,950 109,387 Total 886,449 395,348 |
Stockholders' Equity and Conver
Stockholders' Equity and Convertible Preferred Stock | 3 Months Ended |
Mar. 31, 2020 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity and Convertible Preferred Stock | Note 8. Stockholders' Equity and Convertible Preferred Stock Preferred Stock Effective March 23, 2020, the Company declared a dividend of one right ("Right") for each of the Company's issued and outstanding shares of common stock. Each Right entitles a holder of record, as of the close of business on March 30, 2020, to purchase from the Company one one-thousandth of a share of the Company's Series L preferred stock at a price of $5.00, subject to certain adjustments and subject to the terms of that certain rights agreement, dated as of March 23, 2020, by and between the Company and VStock Transfer, LLC, as rights agent. On March 24, 2020, the Company filed a Certificate of Designation of Series L Preferred Stock with the Secretary of State of the State of Delaware to designate a new Series L preferred stock of the Company. As of March 31, 2020, no Rights have been exercised. Common Stock On March 3, 2020, the Company entered into a securities purchase agreement with certain purchasers, pursuant to which the Company agreed to issue and sell to the purchasers 3,245,745 shares of the Company's common stock, and common warrants ("Common Warrants") to purchase up to 7,142,858 shares of common stock at a price of $ per share of common stock and Common Warrant. This offering resulted in gross proceeds of approximately $7.5 million before deducting the placement agent's fee and related offering expenses of $1.0 million. On March 9, 2020, the Company entered into a securities purchase agreement with certain purchasers, pursuant to which the Company agreed to issue and sell, in a registered direct offering, 2,090,909 shares of the Company's common stock at an offering price of $ per share. The Company also issued placement agent warrants to the placement agent (the "Placement Agent Warrant") to purchase 167,273 shares of common stock with an exercise price of $3.4375 per share. The Company has determined that the Placement Agent Warrant should be accounted as a component of stockholders' equity. On the issuance date, the Company estimated the aggregate fair value of Placement Agent Warrant at $0.2 million using the Black-Scholes option pricing model using the following primary assumptions: fair value of common stock underlying the warrants is $1.83, expected life of 5 years, volatility rate of 122.29%, risk-free interest rate of 0.63% and expected dividend rate of 0%. Warrants A summary of warrant activity for the three months ended March 31, 2020 is presented below: Warrants Weighted Average Total Intrinsic Value Weighted Average Contractual Outstanding as of December 31, 2019 351,939 $ 19.96 $ 111,332 0.94 Issued 11,207,244 0.72 - 0.15 Exercised (10,695,706 ) 0.67 - - Outstanding as of March 31, 2020 863,477 $ 19.96 33,126 0.70 During the three months ended March 31, 2020, the Company issued 3,897,113 and 6,798,593 shares of common stock upon exercise of the Pre-Funded Warrant and Common Warrants, respectively, which resulted in gross proceeds of approximately $7.1 million. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 9. Commitments and Contingencies Legal Proceedings In the past, in the ordinary course of business, the Company actively pursued legal remedies to enforce its intellectual property rights and to stop unauthorized use of our technology. Other than ordinary routine litigation incidental to the business, we know of no material, active or pending legal proceedings against us. Risks and Uncertainties – COVID-19 Management is currently evaluating the impact of the COVID-19 pandemic on the industry and has concluded that while it is reasonably possible that the virus could have a negative effect on the Company's financial position, results of its operations and/or search for drug candidates, the specific impact is not readily determinable as of the date of these financial statements. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 10. Subsequent Events Common Stock Offering On April 14, 2020, the Company, entered into a securities purchase agreement with certain purchasers, pursuant to which the Company agreed to issue and sell14,000,000 shares of the Company's common stock at an offering price of $ per share. The registered offering resulted in gross proceeds to the Company of approximately $14.0 million, before deducting the placement agent's fee and other related offering expenses. The Nasdaq Stock Market Deficiency Notice On April 28, 2020, the Company, received a staff deficiency notice from Nasdaq informing the Company that its common stock failed to comply with the $1.00 minimum bid price required for continued listing on The Nasdaq Capital Market under Nasdaq Listing Rule 5550(a)(2). Nasdaq's letter advised the Company that, based upon the closing bid price during the period from March 16, 2020 to April 27, 2020, the Company no longer meets this requirement. Given the current extraordinary market conditions, Nasdaq has determined to toll the compliance periods for the bid price and market value of publicly held shares requirements through June 30, 2020. Pursuant to Nasdaq Marketplace Rule 5810(c)(3)(A), the Company has been provided with a compliance period of 180 calendar days from June 30, 2020, or until December 28, 2020, to regain compliance with the minimum bid price requirement. To regain compliance, the closing bid price of the Company's common stock must meet or exceed $1.00 per share for a minimum of 10 consecutive business days prior to December 28, 2020. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Principles of Consolidation | Basis of Presentation and Principles of Consolidation The accompanying unaudited condensed consolidated interim financial statements include the accounts of the Company and its subsidiaries. All material intercompany balances and transactions have been eliminated. Certain immaterial reclassifications have been made to prior period amounts to conform to the current period presentation. The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with the accounting principles generally accepted in the United States of America ("U.S. GAAP") for interim financial information and pursuant to the instructions to Form 10-Q and Article 8 of Regulation S-X of the Securities and Exchange Commission ("SEC") and on the same basis as the Company prepares its annual audited consolidated financial statements. The condensed consolidated balance sheet as of March 31, 2020, condensed consolidated statements of operations for the three months ended March 31, 2020 and 2019, condensed consolidated statement of stockholders' equity for the three months ended March 31, 2020 and 2019, and the condensed consolidated statements of cash flows for the three months ended March 31, 2020 and 2019 are unaudited, but include all adjustments, consisting only of normal recurring adjustments, which the Company considers necessary for a fair presentation of the financial position, operating results and cash flows for the periods presented. The results for the three months ended March 31, 2020 are not necessarily indicative of results to be expected for the year ending December 31, 2020 or for any future interim period. The condensed consolidated balance sheet at December 31, 2019 has been derived from audited financial statements; however, it does not include all of the information and notes required by U.S. GAAP for complete financial statements. The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements for the year ended December 31, 2019 and notes thereto included in the Company's annual report on Form 10-K, which was filed with the SEC on February 3, 2020. |
Use of Estimates | Use of Estimates The accompanying condensed consolidated financial statements have been prepared in conformity with US GAAP. This requires management to make estimates and assumptions that affect certain reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements, and the reported expenses during the period. The Company's significant estimates and assumptions include the valuation of investments and the valuation allowance related to the Company's deferred tax assets. Certain of the Company's estimates, including the carrying amount of its investments, could be affected by external conditions, including those unique to the Company and general economic conditions. It is reasonably possible that these external factors could have an effect on the Company's estimates and could cause actual results to differ from those estimates and assumptions. |
Significant Accounting Policies | Significant Accounting Policies Other than as described below, there have been no material changes in the Company's significant accounting policies to those previously disclosed in the Company's annual report on Form 10-K, which was filed with the SEC on February 3, 2020. |
Net Income Loss per Share | Net Income Loss per Share Basic loss per share is computed by dividing the net income or loss applicable to common shares by the weighted average number of common shares outstanding during the period. Net loss attributable to common stockholders includes the effect of the deemed capital contribution on extinguishment of preferred stock and the deemed dividend related to the immediate accretion of beneficial conversion feature of convertible preferred stock. Diluted earnings per share is computed using the weighted average number of common shares and, if dilutive, potential common shares outstanding during the period. Potential common shares consist of the incremental common shares issuable upon the exercise of stock options (using the treasury stock method) and the conversion of the Company's convertible preferred stock and warrants (using the if-converted method). Diluted loss per share excludes the shares issuable upon the conversion of preferred stock and the exercise of stock options and warrants from the calculation of net loss per share if their effect would be anti-dilutive. |
Recently Adopted Accounting Standards | Recently Adopted Accounting Standards In August 2018, the Financial Accounting Standards Board ("FASB") issued ASU 2018-13, " Fair Value Measurement |
Investments in Marketable Sec_2
Investments in Marketable Securities (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of marketable securities | For the Three Months Ended 2020 2019 Realized loss $ (44 ) $ (73 ) Unrealized (loss) gain (835 ) 148 Dividend income 13 17 Interest income 4 - $ (863 ) $ 92 |
Investment in Hoth Therapeuti_2
Investment in Hoth Therapeutics, Inc. (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Investment in Hoth Therapeutics, Inc. [Abstract] | |
Schedule of company investment in Hoth | Security Name Shares Owned as of Fair value per Share Fair value as of HOTH 1,636,230 $ 3.06 $ 5,007 |
Fair Value of Financial Asset_2
Fair Value of Financial Assets and Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Schedule of fair value assets and liabilities | The following table presents the Company's assets and liabilities that are measured at fair value at March 31, 2020 and December 31, 2019 ($ in thousands): Fair value measured at March 31, 2020 Total at March 31, Quoted prices in Significant other Significant unobservable 2020 (Level 1) (Level 2) (Level 3) Assets Marketable securities - mutual and exchange traded funds $ 16,141 $ 16,141 $ - $ - Investments in Hoth $ 5,007 $ 5,007 $ - $ - Fair value measured at December 31, 2019 Total at Quoted prices in Significant other Significant unobservable 2019 (Level 1) (Level 2) (Level 3) Assets Marketable securities - mutual and exchange traded funds $ 857 $ 857 $ - $ - Investments in Hoth $ 10,128 $ 10,128 $ - $ - |
Net Loss per Share (Tables)
Net Loss per Share (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of potentially dilute loss per share | As of As of March 31, 2020 2019 Convertible preferred stock 688 688 Warrants to purchase common stock 796,811 285,273 Options to purchase common stock 88,950 109,387 Total 886,449 395,348 |
Stockholders' Equity and Conv_2
Stockholders' Equity and Convertible Preferred Stock (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Stockholders' Equity Note [Abstract] | |
Schedule of warrant activity | Warrants Weighted Average Total Intrinsic Value Weighted Average Contractual Outstanding as of December 31, 2019 351,939 $ 19.96 $ 111,332 0.94 Issued 11,207,244 0.72 - 0.15 Exercised (10,695,706 ) 0.67 - - Outstanding as of March 31, 2020 863,477 $ 19.96 33,126 0.70 |
Organization and Description _2
Organization and Description of Business (Details Narrative) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2020 | Mar. 31, 2019 | |
Organization and Description of Business (Textual) | |||
Amount of shares issued | $ 5,095 | ||
Gross proceeds | $ 2,000 | $ 5,095 | |
Payment due | $ 1,000 | ||
Description of biotechnology research development | Preclinical studies have also indicated that DHA-dFdC inhibits pancreatic cancer cell growth (up to 100,000-fold more potent that gemcitabine, a current standard therapy). |
Investments in Marketable Sec_3
Investments in Marketable Securities (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Investments, Debt and Equity Securities [Abstract] | ||
Realized loss | $ (44) | $ (73) |
Unrealized (loss) gain | (835) | 148 |
Dividend income | 13 | 17 |
Interest income | 4 | |
Total marketable securities | $ (863) | $ 92 |
Investment in Hoth Therapeuti_3
Investment in Hoth Therapeutics, Inc. (Details) - Hoth Therapeutics Inc [Member] $ / shares in Units, $ in Thousands | Mar. 31, 2020USD ($)$ / sharesshares |
Shares Owned | shares | 1,636,230 |
Fair value per Share | $ / shares | $ 3.06 |
Fair value | $ | $ 5,007 |
Investment in Hoth Therapeuti_4
Investment in Hoth Therapeutics, Inc. (Details Narrative) | Mar. 31, 2020$ / shares |
Hoth Therapeutics Inc [Member] | |
Investment in Hoth Therapeutics, Inc. (Textual) | |
Fair value per Share | $ 3.06 |
Investment in Others (Details)
Investment in Others (Details) - USD ($) $ in Thousands | Dec. 05, 2019 | May 31, 2019 | Mar. 31, 2020 |
Investment in Others (Textual) | |||
Carrying amount | $ 0 | ||
Senior Convertible Note [Member] | |||
Investment in Others (Textual) | |||
Carrying amount | $ 1,000 | ||
Other investments | $ 25,000 | ||
Description of senior convertible note issued | The Company wrote-off its investment to research and development expense as the original purchase of 50,000 CBM shares was a component of the transaction contemplated with CBM. | The Company purchased (a) a senior convertible note issued by DatChat with outstanding principal of $300,000, with an initial conversion rate of $0.20 per share, (b) a warrant to purchase 2,250,000 shares of DatChat common stock at an initial exercise price of $0.20 per share, (c) an option to acquire an additional $300,000 senior convertible note and a warrant to purchase 1,500,000 shares of DatChat common stock, (d) a contingent option to purchase 500,000 shares of DatChat common stock from an existing DatChat stockholder, and (e) a contingent option to put 200,000 shares of DatChat common stock and (f) 50,000 shares of common stock of CBM which represents a 20% interest in CBM. |
Fair Value of Financial Asset_3
Fair Value of Financial Assets and Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Assets | ||
Marketable securities - mutual and exchange traded funds | $ 16,141 | $ 857 |
Investments in Hoth | 5,007 | 10,128 |
Quoted prices in active markets (Level 1) [Member] | ||
Assets | ||
Marketable securities - mutual and exchange traded funds | 16,141 | 857 |
Investments in Hoth | 5,007 | 10,128 |
Significant other observable inputs (Level 2) [Member] | ||
Assets | ||
Marketable securities - mutual and exchange traded funds | ||
Investments in Hoth | ||
Significant unobservable inputs (Level 3) [Member] | ||
Assets | ||
Marketable securities - mutual and exchange traded funds | ||
Investments in Hoth |
Fair Value of Financial Asset_4
Fair Value of Financial Assets and Liabilities (Details Narrative) - Hoth [Member] | 12 Months Ended |
Dec. 31, 2018$ / shares | |
Price per share, low range | $ 5.50 |
Price per share, high range | $ 6.50 |
Percentage of probability, low end | 10.00% |
Percentage of probability, high end | 90.00% |
Risk-adjusted discount rate | 15.00% |
Net Loss per Share (Details)
Net Loss per Share (Details) - shares | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Total | 886,449 | 395,348 |
Convertible preferred Stock [Member] | ||
Total | 688 | 688 |
Warrant [Member] | ||
Total | 796,811 | 285,273 |
Options to purchase common stock [Member] | ||
Total | 88,950 | 109,387 |
Stockholders' Equity and Conv_3
Stockholders' Equity and Convertible Preferred Stock (Details) - Warrant [Member] $ / shares in Units, $ in Thousands | 3 Months Ended |
Mar. 31, 2020USD ($)$ / sharesshares | |
Number of shares | |
Outstanding at beginnning | shares | 351,939 |
Issued | shares | 11,207,244 |
Exercised | shares | (10,695,706) |
Outstanding at ending | shares | 863,477 |
Weighted Average Exercise Price | |
Beginnning balance | $ / shares | $ 19.96 |
Issued | $ / shares | 0.72 |
Exercised | $ / shares | 0.67 |
Ending balance | $ / shares | $ 19.96 |
Total Intrinsic value | |
Outstanding at beginning | $ | $ 111,332 |
Issued | $ | |
Exercised | $ | |
Outstanding at ending | $ | $ 33,126 |
Weighted Average Remaining Contractual Life (In years) | |
Outstanding at beginning | 11 months 8 days |
Issued | 1 month 24 days |
Exercised | |
Outstanding at ending | 8 months 12 days |
Stockholders' Equity and Conv_4
Stockholders' Equity and Convertible Preferred Stock (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | |||
Mar. 23, 2020 | Mar. 09, 2020 | Mar. 03, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | |
Stockholders' Equity and Convertible Preferred Stock (Textual) | |||||
Number of common stock issued | 20,857,912 | 20,857,909 | |||
Description of issued of warrants | The Company issued 3,897,113 and 6,798,593 shares of common stock upon exercise of the Pre-Funded Warrant and Common Warrants, respectively, which resulted in gross proceeds of approximately $7.1 million. | ||||
Securities Purchase Agreement [Member] | |||||
Stockholders' Equity and Convertible Preferred Stock (Textual) | |||||
Number of common stock issued | 2,090,909 | 3,245,745 | |||
Warrants to purchase common stock | 7,142,858 | ||||
Description of issued of warrants | The Company also issued placement agent warrants to the placement agent (the "Placement Agent Warrant") to purchase 167,273 shares of common stock with an exercise price of $3.4375 per share. | ||||
Offering expense | $ 700 | $ 1,000 | |||
Gross proceeds | $ 5,750 | $ 7,500 | |||
Price per share | $ 2.75 | $ 1.05 | |||
Pre-Funded Warrants, description | The Company also offered 3,897,113 pre-funded warrants ("Pre-Funded Warrants") to purchase shares of common stock with a purchase price of $1.0499 each Pre-Funded Warrant. The exercise price of each Pre-Funded Warrant was $0.0001 per share and each Common Warrant was $1.05 per share. | ||||
Volatility rate | 122.29% | ||||
Risk-free interest rate | 0.63% | ||||
Expected life | 5 years | ||||
Expected dividend rate | 0.00% | ||||
Fair value of common stock underlying the warrants | $ 1.83 | ||||
Estimated the aggregate fair value | $ 200 | ||||
Series L Preferred Stock [Member] | |||||
Stockholders' Equity and Convertible Preferred Stock (Textual) | |||||
Description of preferred stock voting rights | Each Right entitles a holder of record, as of the close of business on March 30, 2020, to purchase from the Company one one-thousandth of a share of the Company's Series L preferred stock at a price of $5.00, subject to certain adjustments and subject to the terms of that certain rights agreement, dated as of March 23, 2020, by and between the Company and VStock Transfer, LLC, as rights agent. |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | Apr. 14, 2020 | Apr. 28, 2020 | Mar. 31, 2020 | Dec. 31, 2019 |
Subsequent Events (Textual) | ||||
Issuance of common stock | 20,857,912 | 20,857,909 | ||
Subsequent Event [Member] | Nasdaq [Member] | ||||
Subsequent Events (Textual) | ||||
Minimum bid price | $ 1 | |||
Gross proceeds | $ 14,000 | |||
Exceed price per sharew | $ 1 | |||
Subsequent Event [Member] | Common Stock [Member] | ||||
Subsequent Events (Textual) | ||||
Issuance of common stock | 14,000,000 | |||
Common stock offering price | $ 1 |