Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2022 | Apr. 30, 2022 | |
Document and Entity Information [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Mar. 31, 2022 | |
Entity File Number | 001-36576 | |
Entity Registrant Name | MARINUS PHARMACEUTICALS, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 20-0198082 | |
Entity Address, Address Line One | 5 Radnor Corporate Center, Suite 500 | |
Entity Address, Address Line Two | 100 Matsonford Rd | |
Entity Address, City or Town | Radnor | |
Entity Address, State or Province | PA | |
Entity Address, Postal Zip Code | 19087 | |
City Area Code | 484 | |
Local Phone Number | 801-4670 | |
Title of 12(b) Security | Common Stock, par value $0.001 per share | |
Trading Symbol | MRNS | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 37,140,406 | |
Entity Central Index Key | 0001267813 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 126,319 | $ 122,927 |
Accounts receivable | 2,489 | 2,629 |
Contract asset | 557 | |
Prepaid expenses and other current assets | 6,263 | 5,565 |
Total current assets | 135,071 | 131,678 |
Property and equipment, net | 2,989 | 2,499 |
Other assets | 2,750 | 2,663 |
Total assets | 140,810 | 136,840 |
Current liabilities: | ||
Accounts payable | 4,671 | 3,126 |
Refund liability | 21,233 | |
Accrued expenses | 14,865 | 16,207 |
Total current liabilities | 19,536 | 40,566 |
Notes payable, net of deferred financing costs | 69,927 | 40,809 |
Contract liability | 9,113 | |
Other long-term liabilities | 1,829 | 1,979 |
Total liabilities | 100,405 | 83,354 |
Stockholders' equity: | ||
Series A convertible preferred stock, $0.001 par value; 25,000,000 shares authorized, 4,575 shares issued and outstanding at March 31, 2022 and December 31, 2021 | 4,302 | 4,302 |
Common stock, $0.001 par value; 150,000,000 shares authorized, 37,145,981 issued and 37,138,674 outstanding at March 31, 2022 and 36,797,561 issued and 36,790,254 outstanding at December 31, 2021 | 37 | 37 |
Additional paid-in capital | 466,132 | 459,852 |
Treasury stock at cost, 7,307 shares at March 31, 2022 and December 31, 2021 | ||
Accumulated deficit | (430,066) | (410,705) |
Total stockholders' equity | 40,405 | 53,486 |
Total liabilities and stockholders' equity | $ 140,810 | $ 136,840 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Mar. 31, 2022 | Dec. 31, 2021 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 150,000,000 | 150,000,000 |
Common stock, shares issued | 37,145,981 | 36,797,561 |
Common stock, shares outstanding | 37,138,674 | 36,790,254 |
Treasury stock, shares | 7,307 | 7,307 |
Series A Preferred Stock | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 25,000,000 | 25,000,000 |
Preferred Stock, Shares Issued | 4,575 | 4,575 |
Preferred stock, shares outstanding | 4,575 | 4,575 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS | ||
Federal contract revenue | $ 1,513 | $ 1,806 |
Collaboration revenue | 12,673 | |
Total revenue | 14,186 | 1,806 |
Expenses: | ||
Research and development | 17,991 | 18,591 |
General and administrative | 11,737 | 10,376 |
Cost of IP license fee | 1,169 | |
Total expenses | 30,897 | 28,967 |
Loss from operations | (16,711) | (27,161) |
Interest income | 12 | 24 |
Interest expense | (1,692) | |
Other expense, net | (970) | (4) |
Net loss and comprehensive loss | (19,361) | (27,141) |
Net loss applicable to common shareholders | $ (19,361) | $ (27,141) |
Per share information: | ||
Net loss per share of common stock-basic | $ (0.52) | $ (0.74) |
Net loss per share of common stock-diluted | $ (0.52) | $ (0.74) |
Basic weighted average shares outstanding | 36,890,568 | 36,599,701 |
Diluted weighted average shares outstanding | 36,890,568 | 36,599,701 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Cash flows from operating activities | ||
Net loss | $ (19,361) | $ (27,141) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 85 | 85 |
Amortization of debt issuance costs | 282 | |
Stock-based compensation expense | 3,379 | 5,035 |
Amortization of net contract asset/liability | (375) | |
Noncash lease expense | 80 | 73 |
Noncash lease liability | 69 | 82 |
Write-off of fixed assets | 61 | |
Issuance of common stock for cost of license agreement | 1,168 | |
Unrealized loss on foreign currency transactions | 930 | |
Changes in operating assets and liabilities: | ||
Refund Liability | (22,163) | |
Net contract asset/liability | 10,045 | |
Prepaid expenses and other current assets, non-current assets, and accounts receivable | (1,072) | 366 |
Accounts payable, accrued expenses and other long term-liabilities | (783) | 5,325 |
Net cash used in operating activities | (27,655) | (16,175) |
Cash flows from investing activities | ||
Maturities of short-term investments | 1,474 | |
Deposit on property and equipment | (404) | |
Purchases of property and equipment | (86) | (28) |
Net cash (used in) provided by investing activities | (86) | 1,042 |
Cash flows from financing activities | ||
Proceeds from exercise of stock options | 1,733 | 244 |
Proceeds from notes payable, net of upfront fee | 29,400 | |
Financing costs, paid | (148) | |
Net cash provided by financing activities | 31,133 | 96 |
Net (decrease) increase in cash and cash equivalents | 3,392 | (15,037) |
Cash and cash equivalents-beginning of period | 122,927 | 138,509 |
Cash and cash equivalents-end of period | 126,319 | $ 123,472 |
Supplemental disclosure of cash flow information | ||
Debt issuance costs included in accrued expenses | 563 | |
Property and equipment in accrued expenses | 205 | |
Property and equipment in deposits placed in service | $ 337 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Series A Preferred StockPreferred Stock | Common Stock | Additional Paid-in Capital | Treasury Stock | Accumulated Deficit | Total |
Balance at Dec. 31, 2020 | $ 4,469 | $ 37 | $ 444,622 | $ (311,929) | $ 137,199 | |
Balance (in shares) at Dec. 31, 2020 | 4,753 | 36,578,460 | 7,307 | |||
Increase (Decrease) in Stockholders' Equity (Deficit) | ||||||
Stock-based compensation expense | 5,035 | 5,035 | ||||
Exercise of stock options | 244 | 244 | ||||
Exercise of stock options (in shares) | 55,030 | |||||
Financing costs | (3) | (3) | ||||
Net loss | (27,141) | (27,141) | ||||
Balance at Mar. 31, 2021 | $ 4,469 | $ 37 | 449,898 | (339,070) | 115,334 | |
Balance (in shares) at Mar. 31, 2021 | 4,753 | 36,633,490 | 7,307 | |||
Balance at Dec. 31, 2021 | $ 4,302 | $ 37 | 459,852 | (410,705) | 53,486 | |
Balance (in shares) at Dec. 31, 2021 | 4,575 | 36,790,254 | 7,307 | |||
Increase (Decrease) in Stockholders' Equity (Deficit) | ||||||
Stock-based compensation expense | 3,379 | 3,379 | ||||
Exercise of stock options | 1,733 | 1,733 | ||||
Exercise of stock options (in shares) | 225,165 | |||||
Issuance of common stock | 1,168 | 1,168 | ||||
Issuance of common stock (in shares) | 123,255 | |||||
Net loss | (19,361) | (19,361) | ||||
Balance at Mar. 31, 2022 | $ 4,302 | $ 37 | $ 466,132 | $ (430,066) | $ 40,405 | |
Balance (in shares) at Mar. 31, 2022 | 4,575 | 37,138,674 | 7,307 |
Description of the Business and
Description of the Business and Liquidity | 3 Months Ended |
Mar. 31, 2022 | |
Description of the Business and Liquidity | |
Description of the Business and Liquidity | 1. Description of the Business and Liquidity We are a pharmaceutical company focused on the development and commercialization of products for patients suffering from rare genetic epilepsies and other seizure disorders. On March 18, 2022, the U.S Food and Drug Administration (FDA) approved our new drug application (NDA) for the use of ZTALMY® (ganaxolone) oral suspension for the treatment of seizures associated with cyclin-dependent kinase-like 5 (CDKL5) deficiency disorder (CDD) in patients 2 years of age and older. The continued global spread of COVID-19, including the Omicron variant and its subvariants, has impacted our clinical operations and timelines. For example, our Phase 3 Randomized Therapy In Status Epilepticus Trial (RAISE trial) in refractory status epilepticus (RSE) is conducted in hospitals, including intensive care units and academic medical centers, which have experienced high rates of COVID-19 admissions. Several academic medical centers and intensive care units participating in the RAISE trial have experienced COVID-related difficulties, including staff turnover and the need to devote significant resources to patients with COVID-19, which has resulted in site initiation and enrollment delays for the RAISE trial. Given these COVID-19-related challenges and a temporary pause beginning in February 2022 of the RAISE trial after routine monitoring of stability batches of clinical supply material indicated that it became necessary to reduce the shelf life to less than the anticipated 24-months to meet product stability testing specifications, we now expect o ur top-line data readout for the RAISE trial to be available in the second half of 2023. In May 2022, we Liquidity We have not generated any product revenues and have incurred operating losses since inception, including losses of $19.4 million for the three months ended March 31, 2022. There is no assurance that profitable operations will ever be achieved, and if achieved, could be sustained on a continuing basis. In addition, development activities, clinical and preclinical testing, and commercialization of ganaxolone will require significant additional financing. Our accumulated deficit as of March 31, 2022 was $430.1 million and we expect to incur substantial losses in future periods. We plan to finance our future operations with a combination of proceeds from the issuance of equity securities, the issuance of debt, government funding, collaborations, licensing transactions and other commercial transactions or other sources, such as monetization of our Priority Review Voucher, and revenues from future product sales, if any. We have not generated positive cash flows from operations, and there are no assurances that we will be successful in obtaining an adequate level of financing for the commercialization and continued development of ganaxolone. On July 30, 2021, we entered into a collaboration agreement (the Orion Collaboration Agreement) with Orion Corporation (Orion), whereby Orion received exclusive rights to commercialize the oral and IV dose formulations of ganaxolone in the European Economic Area, United Kingdom and Switzerland in multiple seizure disorders, including CDD, tuberous sclerosis complex (TSC) and RSE. Under the agreement, we received a 90 of the upfront fee. In the event of such termination and refund, Orion would have had no further rights pursuant to the oral and IV dose formulations of ganaxolone and the Orion Collaboration Agreement would have terminated and been of no further force or effect. In February 2022, the verified draft study report showed that no genotoxicity was found, as measured by formation of micronuclei in the bone marrow or comet morphology in the liver. These results were formalized in the final study report received in May 2022 and, as a result of the study’s findings, we are not required to refund Orion any of the upfront fee and Orion does not have the right to terminate the Orion Collaboration Agreement based on the study outcome. On May 11, 2021 (Closing Date), we entered into a Credit Agreement and Guaranty (as amended by that certain letter agreement on May 17, 2021, the Credit Agreement) with Oaktree Fund Administration, LLC, as administrative agent and the lenders party thereto that provides for a five-year tranches (collectively, the Term Loans). As of March 31, 2022, we have drawn a total of In September 2020, we entered into a contract (BARDA Contract) with the Biomedical Advanced Research and Development Authority (BARDA), a division of the U.S. Department of Health and Human Services’ Office of the Assistant Secretary for Preparedness and Response. Under the BARDA Contract, we receive d an award of up to an estimated $51 million for development of IV-administered ganaxolone for the treatment of RSE. The BARDA Contract provides for f unding to support , on a cost-sharing basis , the completion of a Phase 3 clinical trial of IV-administered ganaxolone in patients with RSE , which covers the RAISE trial , funding of pre-clinical studies to evaluate IV-administered ganaxolone a s an effective treatment for RSE due to chemical nerve gas agent exposure, and funding of certain ganaxolone manufacturing scale-up and regulatory activities. In March 2022, we entered into an amendment with BARDA to extend the end date of our base performance period for funding under the BARDA Contract from September 1, 2022 to December 31, 2023. The BARDA Contract consists of an approximately two-year five years Management’s operating plan, which underlies the analysis of our ability to continue as a going concern, involves the estimation of the amount and timing of future cash inflows and outflows. Actual results could vary from the operating plan. We follow the provisions of Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) Topic 205-40, Presentation of Financial Statements—Going Concern, which requires management to assess our ability to continue as a going concern within one year after the date the financial statements are issued. Our cash and cash equivalents on hand as of March 31, 2022, excluding the $15.0 million liquidity requirement associated with our Note Payable (Note 8), is not sufficient to fund operations for the one-year period after the date the financial statements are issued. As a result, there is substantial doubt about our ability to continue as a going concern through the one-year period from the date these financial statements are issued. Management’s plans that are intended to mitigate this risk include the monetization of our Priority Review Voucher and additional financing or strategic transactions. We have and will continue to evaluate available alternatives to further extend our operations beyond the one-year period after the date the financial statements are issued. If additional capital is not obtained when required, we may need to delay or curtail our operations until additional funding is received. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2022 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Basis of Presentation The accompanying unaudited interim consolidated financial statements include the accounts of Marinus Pharmaceuticals, Inc. (a Delaware corporation) as well as the accounts of Marinus Pharmaceuticals Emerald Limited (an Ireland company incorporated in February 2021), a wholly owned subsidiary requiring consolidation. Marinus Pharmaceuticals Emerald Limited serves as a corporate presence in the European Union for regulatory purposes. The unaudited interim consolidated financial statements included herein have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). Accordingly, they do not include all information and disclosures necessary for a presentation of our financial position, results of operations and cash flows in conformity with generally accepted accounting principles in the U.S. (GAAP) for annual financial statements. In the opinion of management, these unaudited interim consolidated financial statements reflect all adjustments, consisting primarily of normal recurring accruals, necessary for a fair presentation of our financial position and results of operations and cash flows for the periods presented. The results of operations for interim periods are not necessarily indicative of the results for the full year. These unaudited interim consolidated financial statements should be read in conjunction with the audited financial statements for the year ended December 31, 2021 and accompanying notes thereto included in our Annual Report on Form 10-K filed with the SEC on March 24, 2022. Use of Estimates The preparation of financial statements in conformity with 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 income and expenses during the reporting period. Actual results could differ from such estimates. Federal Contract Revenue We recognize federal contract revenue from the BARDA Contract in the period in which the allowable research and development expenses are incurred, and receivables associated with this revenue are included within accounts receivable on our interim consolidated balance sheets. This revenue is not within the scope of ASC 606 – Revenue from contracts with customers. Debt Issuance Costs Debt issuance costs incurred in connection with Note payable (Note 8) are amortized to interest expense over the term of the respective financing arrangement using the effective-interest method. Debt issuance costs, net of related amortization are deducted from the carrying value of the related debt. Contract Liability When consideration is received, or such consideration is unconditionally due, from a customer prior to completing our performance obligation to the customer under the terms of a contract, a contract liability is recorded. Contract liabilities expected to be recognized as revenue or a reduction of expense within the 12 months following the balance sheet date are classified as current liabilities. Contract liabilities not expected to be recognized as revenue within the 12 months following the balance sheet date are classified as long-term liabilities. In accordance with ASC 210-20, our contract liability is partially offset by a contract asset as further discussed in Note 9. Collaboration and Licensing Revenue We may enter into collaboration and licensing arrangements for research and development, manufacturing, and commercialization activities with counterparties for the development and commercialization of our product candidates. These arrangements may contain multiple components, such as (i) licenses, (ii) research and development activities, and (iii) the manufacturing of certain material. Payments pursuant to these arrangements may include non-refundable and refundable payments, payments upon the achievement of significant regulatory, development and commercial milestones, sales of product at certain agreed-upon amounts, and royalties on product sales. The amount of variable consideration is constrained until it is probable that the revenue is not at a significant risk of reversal in a future period. In determining the appropriate amount of revenue to be recognized as we fulfill our obligations under a collaboration agreement, we perform the following steps: (i) identification of the promised goods or services in the contract; (ii) determination of whether the promised goods or services are performance obligations, including whether they are capable of being distinct; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue as we satisfy each performance obligation. We must develop estimates and assumptions that require judgment to determine the underlying stand-alone selling price for each performance obligation, which determines how the transaction price is allocated among the performance obligations. The estimation of the stand-alone selling price may include such estimates as forecasted revenues and costs, development timelines, discount rates and probabilities of regulatory and commercial success. We also apply significant judgment when evaluating whether contractual obligations represent distinct performance obligations, allocating transaction price to performance obligations within a contract, determining when performance obligations have been met, assessing the recognition and future reversal of variable consideration and determining and applying appropriate methods of measuring progress for performance obligations satisfied over time. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2022 | |
Fair Value Measurements | |
Fair Value Measurements | 3. Fair Value Measurements FASB accounting guidance defines fair value as the price that would be received to sell an asset or paid to transfer a liability (the exit price) in an orderly transaction between market participants at the measurement date. The accounting guidance outlines a valuation framework and creates a fair value hierarchy in order to increase the consistency and comparability of fair value measurements and the related disclosures. In determining fair value, we use quoted prices and observable inputs. Observable inputs are inputs that market participants would use in pricing the asset or liability based on market data obtained from independent sources. The fair value hierarchy is broken down into three levels based on the source of inputs as follows: ● Level 1 — Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities. ● Level 2 — Valuations based on observable inputs and quoted prices in active markets for similar assets and liabilities. ● Level 3 — Valuations based on inputs that are unobservable and models that are significant to the overall fair value measurement. If the inputs used to measure fair value fall within different levels of the hierarchy, the category level is based on the lowest priority level input that is significant to the fair value measurement of the instrument. As of March 31, 2022 and December 31, 2021, all of our financial assets and liabilities were classified as Level 1 valuations. The following fair value hierarchy table presents information about each major category of our financial assets and liabilities measured at fair value on a recurring basis (in thousands): Level 1 Level 2 Level 3 Total March 31, 2022 Assets Cash $ 34,128 $ — $ — $ 34,128 Money market funds (cash equivalents) 92,191 — — 92,191 Total assets $ 126,319 $ — $ — $ 126,319 December 31, 2021 Assets Cash $ 2,360 $ — $ — $ 2,360 Money market funds (cash equivalents) 120,567 — — 120,567 Total assets $ 122,927 $ — $ — $ 122,927 |
Accrued Expenses
Accrued Expenses | 3 Months Ended |
Mar. 31, 2022 | |
Accrued Expenses | |
Accrued Expenses | 4. Accrued Expenses Accrued expenses consisted of the following (in thousands): March 31, December 31, 2022 2021 Payroll and related costs $ 3,360 $ 5,830 Clinical trials and drug development 8,765 8,217 Professional fees 1,431 1,311 Debt issuance costs and commitment fees 630 — Short-term lease liabilities 575 556 Other 104 293 Total accrued expenses $ 14,865 $ 16,207 |
Loss Per Share of Common Stock
Loss Per Share of Common Stock | 3 Months Ended |
Mar. 31, 2022 | |
Loss Per Share of Common Stock | |
Loss Per Share of Common Stock | 5. Loss Per Share of Common Stock Basic loss per share is computed by dividing net loss applicable to common stockholders by the weighted average number of shares of common stock outstanding during each period. Diluted loss per share includes the effect, if any, from the potential exercise or conversion of securities, such as convertible preferred stock, convertible notes payable, warrants, stock options, and unvested restricted stock, which would result in the issuance of incremental shares of common stock. In computing the basic and diluted net loss per share applicable to common stockholders, the weighted average number of shares remains the same for both calculations due to the fact that when a net loss exists, dilutive shares are not included in the calculation. These potentially dilutive securities are more fully described in Note 6, and summarized in the table below: March 31, 2022 2021 Convertible preferred stock 915,000 950,600 Restricted stock awards and restricted stock units 541,670 22,000 Stock options 5,654,024 4,436,778 7,110,694 5,409,378 |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2022 | |
Stockholders' Equity | |
Stockholders' Equity | 6. Stockholders’ Equity In 2005, we adopted the 2005 Stock Option and Incentive Plan (2005 Plan) that authorizes us to grant stock options, restricted stock and other equity-based awards. As of March 31, 2022, 577 options to purchase shares of common stock were outstanding pursuant to grants in connection with the 2005 Plan. Effective August 2014, we adopted our 2014 Equity Incentive Plan, as amended (2014 Plan), that authorizes us to grant stock options, restricted stock, and other equity-based awards, subject to adjustment in accordance with the 2014 Plan. As of March 31, 2022, 4,072,818 options to purchase shares of common stock were outstanding pursuant to grants in connection with the 2014 Plan, and 816,377 shares of common stock were available for future issuance. The amount, terms of grants, and exercisability provisions are determined and set by our board of directors. In accordance with the 2014 Plan, on January 1, 2022, the shares of common stock available for future grants under the 2014 Plan was increased to 2,343,330. Stock Options There were 5,654,024 stock options outstanding as of March 31, 2022 at a weighted average exercise price of $11.66 per share, including 1,580,629 stock options outstanding outside of the 2014 Plan, granted as inducements to new employees. Total compensation cost recognized for all stock option awards in the statements of operations is as follows (in thousands): Three Months Ended March 31, 2022 2021 Research and development $ 1,179 $ 1,190 General and administrative 1,899 3,790 Total $ 3,078 $ 4,980 Restricted Stock All issued and outstanding restricted shares of common stock are time-based, and become vested within two years of the grant date, pursuant to the 2014 Plan. Compensation expense is recorded ratably over the requisite service period. Compensation expense related to restricted stock is measured based on the fair value using the closing market price of our common stock on the date of the grant. As of March 31, 2022, we had 22,625 outstanding shares of restricted common stock. During the three months ended March 31, 2022, we granted 515,645 restricted stock units, which vest within four years of the grant date, pursuant to the 2014 Plan. As of March 31, 2022, we had 519,045 restricted stock units outstanding. Total compensation cost recognized for all restricted stock awards and restricted stock units in the statements of operations is as follows (in thousands): Three Months Ended March 31, 2022 2021 Research and development $ 99 $ — General and administrative 202 55 Total $ 301 $ 55 Preferred Stock As of March 31, 2022, 4,575 shares of our Series A Convertible Preferred Stock (Preferred Stock) remained outstanding, convertible into 915,000 shares of our common stock. Stock Issued in Connection with Ovid License Agreement Unregistered Sales of Equity Securities and Use of Proceeds |
Leases
Leases | 3 Months Ended |
Mar. 31, 2022 | |
Leases | |
Leases | 7. Leases We have entered into one operating lease for real estate. This lease has a term of 78 months, and includes renewal terms which can extend the lease terms by 60 months (which we include in lease terms when it is reasonably certain that we will exercise the option). As of March 31, 2022, our operating lease had a remaining lease term of 42 months. The right-of-use (ROU) asset is included in "Other assets" on our interim consolidated balance sheets as of March 31, 2022 and December 31, 2021, and represents our right to use the underlying asset for the lease term. Our obligations to make lease payments are included in " Accrued expenses Other long-term liabilities As of March 31, 2022 and December 31, 2021, ROU assets were $1.6 million and $1.7 million, respectively, and operating lease liabilities were $2.4 million and $2.5 million, respectively. We have entered into various short-term operating leases, primarily for clinical trial equipment, with an initial term of twelve months or less. These leases are not recorded on our balance sheets. All operating lease expense is recognized on a straight-line basis over the lease term. During the three months ended March 31, 2022 and 2021, we recognized $0.1 million and $0.2 million, respectively, in total lease costs, each of which included less than $0.1 million in short-term lease costs related to short-term operating leases. Because the rate implicit in each lease is not readily determinable, we use our incremental borrowing rate to determine the present value of the lease payments. The weighted average incremental borrowing rate used to determine the initial value of ROU assets and lease liabilities was 11.0%, derived from a corporate yield curve based on a synthetic credit rating model using a market signal analysis. We have certain contracts for real estate which may contain lease and non-lease components which we have elected to treat as a single lease component. ROU assets for operating leases are periodically reduced by impairment losses. We use the long-lived assets impairment guidance in ASC Subtopic 360-10, Property, Plant, and Equipment – Overall, to determine whether an ROU asset is impaired, and if so, the amount of the impairment loss to recognize. As of March 31, 2022 and December 31, 2021, we have not recognized any impairment losses for our ROU assets. We monitor for events or changes in circumstances that require a reassessment of our lease. When a reassessment results in the remeasurement of a lease liability, a corresponding adjustment is made to the carrying amount of the corresponding ROU asset unless doing so would reduce the carrying amount of the ROU asset to an amount less than zero. In that case, the amount of the adjustment that would result in a negative ROU asset balance is recorded in our interim consolidated statements of operations and comprehensive loss. Maturities of operating lease liabilities as of March 31, 2022 were as follows (in thousands): Remaining nine months of 2022 $ 609 2023 823 2024 840 2025 642 Thereafter — 2,914 Less: imputed interest (510) Total lease liabilities $ 2,404 Current operating lease liabilities $ 575 Non-current operating lease liabilities 1,829 Total lease liabilities $ 2,404 |
Notes Payable
Notes Payable | 3 Months Ended |
Mar. 31, 2022 | |
Notes Payable | |
Notes Payable | 8. Notes Payable On May 11, 2021 (Closing Date) and as amended on May 17, 2021, we entered into the Credit Agreement with Oaktree Fund Administration, LLC as administrative agent (Oaktree) and the lenders party thereto (collectively, the Lenders) that provides for a five-year senior secured term loan facility in an aggregate original principal amount of up to $125.0 million, available to us in five tranches (collectively, the Term Loans). Upon entering into the Credit Agreement in May 2021, we borrowed $15.0 million in term loans from the Lenders (Tranche A-1 Term Loan); upon receipt of written acceptance by the FDA of our NDA filing relating to the use of ganaxolone in CDD in September 2021 we borrowed $30.0 million of tranche A-2 term loans from the Lenders (Tranche A-2 Term Loan); and in March 2022, we borrowed $30.0 million in term loans from the Lenders that became available as a result of the approval by the FDA of ZTALMY oral suspension for the treatment of seizures associated with CDD in patients two years of age and older (Tranche B Term Loan). Under the terms of the Credit Agreement, we may, at our sole discretion, borrow from the Lenders up to an additional $50.0 million in term loans subject to certain milestone events, as follows: ● Through June 30, 2023, $25.0 million of tranche C term loans will be available for draw if we complete one or more financings (including through the issuance of common stock, convertible debt, subordinated debt, a synthetic royalty, or a sublicense) resulting in gross proceeds to us of at least $40.0 million and net proceeds to us of at least $36.0 million. In addition, the availability of this tranche is subject to certain clinical outcomes. ● Through December 31, 2023, $25.0 million of tranche D term loans will be available for draw if we earn an aggregate of at least $50.0 million in net product revenue in the U.S. for a trailing six consecutive months. In addition, the Credit Agreement contains a minimum liquidity covenant that requires us to maintain cash and cash equivalents of at least $15.0 million from the funding date of the tranche B term loans until the maturity of the Term Loans. The Term Loans will be guaranteed by certain of our future subsidiaries (Guarantors). Our obligations under the Credit Agreement are secured by a pledge of substantially all of our assets and will be secured by a pledge of substantially all of the assets of the Guarantors. The Term Loans mature on May 11, 2026 (Maturity Date). The Term Loans bear interest at a fixed per annum rate (subject to increase during an event of default) of 11.50% , and we are required to make quarterly interest payments until the Maturity Date. We are also required to make quarterly principal payments beginning on June 30, 2024 in an amount equal to 5.0% of the aggregate amount of the Term Loans outstanding on June 30, 2024, and continuing until the Maturity Date. On the Maturity Date, we are required to pay in full all outstanding Term Loans and other amounts owed under the Credit Agreement. At the time of borrowing any tranche of the Term Loans, we are required to pay an upfront fee of 2.0% of the aggregate principal amount borrowed at that time. In addition, a commitment fee of 75 basis points per annum began to accrue on each of the tranche B, C, and D commitments for the period beginning 120 days after the funding date of the tranche A-2 term loans, and continues until the applicable tranche is either funded or terminated, at which time the related commitment fees are due. The tranche A-2 term loans were funded on September 27, 2021, and as such, we began accruing the commitment fees for tranche B, C, and D term loans 120 days later, on January 25, 2022. We drew down the additional $30.0 million of tranche B term loans in March 2022, and paid less than $0.1 million in commitment fees related to tranche B term loans. At March 31, 2022, we had less than $0.1 million accrued for commitment fees related to tranche C and D term loans. We may prepay all or any portion of the Term Loans, and are required to make mandatory prepayments of the Term Loans from the proceeds of asset sales, casualty and condemnation events, and prohibited debt issuances, subject to certain exceptions. All mandatory and voluntary prepayments of the Term Loans are subject to prepayment premiums equal to (i) of the principal prepaid if prepayment occurs after May 11, 2024 but on or before May 11, 2025. If prepayment occurs after May 11, 2025, We are also required to make mandatory prepayments of the Term Loans upon an event of default under the Credit Agreement resulting from the occurrence of a change of control. These mandatory prepayments are subject to a prepayment premium equal to (i) In addition, we are required to pay an exit fee in an amount equal to 2.0% of all principal repaid, whether as a mandatory prepayment, voluntary prepayment, or a scheduled repayment. In addition to the minimum liquidity covenant, we are subject to a number of affirmative and restrictive covenants under the Credit Agreement, including limitations on our ability and our subsidiaries’ abilities, among other things, to incur additional debt, grant or permit additional liens, make investments and acquisitions, merge or consolidate with others, dispose of assets, pay dividends and distributions, and enter into affiliate transactions, subject to certain exceptions. As of March 31, 2022, we were in compliance with all covenants. Upon the occurrence of certain events, including but not limited to our failure to satisfy our payment obligations under the Credit Agreement, the breach of certain of our other covenants under the Credit Agreement, the occurrence of cross defaults to other indebtedness, or defaults related to enforcement action by the FDA or other Regulatory Authority or recall of ganaxolone, Oaktree and the Lenders will have the right, among other remedies, to accelerate all amounts outstanding under the Term Loans and declare all principal, interest, and outstanding fees immediately due and payable. In March 2022, we borrowed $30.0 million upon the approval by the FDA of ZTALMY for CDD and incurred debt issuance costs of $1.8 million, including the exit fee of $0.6 million, that are classified as contra-liabilities on our consolidated balance sheets and are being recognized as interest expenses over the term of the loan using the effective interest method. In September 2021, we borrowed $30.0 million upon receipt of written acceptance by the FDA of our NDA filing relating to the use of ganaxolone in the treatment of CDD and incurred debt issuance costs of $1.2 million, including the exit fee of $0.6 million, that are classified as contra-liabilities on our consolidated balance sheets and are being recognized as interest expenses over the term of the loan using the effective-interest method. In May 2021, we borrowed $15.0 million upon entering into the Credit Agreement and incurred debt issuance costs of $4.4 million, including the exit fee of $0.3 million, that are classified as a contra-liabilities on the consolidated balance sheet and are being recognized as interest expenses over the term of the loan using the effective-interest method. For the three months ended March 31, 2022, we recognized interest expense of $1.7 million, of which $1.3 million was interest on the Term Loans, $0.3 million was non-cash interest expense related to the amortization of debt issuance costs, less than $0.1 million was non-cash interest expense related to the commitment fee, and less than $0.1 million was related to commitment fees paid in the three months ended March 31, 2022. The following table summarizes the composition of Notes payable as reflected on the consolidated balance sheet as of March 31, 2022 (in thousands): Gross proceeds $ 75,000 Contractual exit fee 1,500 Unamortized debt discount and issuance costs (6,573) Total $ 69,927 The aggregate maturities of Notes payable as of March 31, 2022 are as follows (in thousands): Remainder of 2022 $ — 2023 — 2024 11,250 2025 15,000 2026 and thereafter 48,750 Total $ 75,000 |
Collaboration Revenue
Collaboration Revenue | 3 Months Ended |
Mar. 31, 2022 | |
Collaboration Revenue | |
Collaboration Revenue | 9. Collaboration Revenue In July 2021, we entered into a collaboration agreement (the Orion Collaboration Agreement) with Orion Corporation (Orion). The Orion Collaboration Agreement falls under the scope of ASC Topic 808, Collaborative Arrangements (ASC 808) as both parties are active participants in the arrangement that are exposed to significant risks and rewards. While this arrangement is in the scope of ASC 808, we analogize to ASC 606 for some aspects of this arrangement, including for the delivery of a good or service (i.e., a unit of account). Revenue recognized by analogizing to ASC 606 is recorded as collaboration revenue on the consolidated statements of operations. Under the terms of the Orion Collaboration Agreement, we granted Orion an exclusive, royalty-bearing, sublicensable license to certain of our intellectual property rights with respect to commercializing biopharmaceutical products incorporating our product candidate ganaxolone (Licensed Products) in the European Economic Area, the United Kingdom and Switzerland (collectively, the Territory) for the diagnosis, prevention and treatment of certain human diseases, disorders or conditions (Field), initially in the indications of CDD, TSC and RSE. We will be responsible for the continued development of Licensed Products and regulatory interactions related thereto, including conducting and sponsoring all clinical trials, provided that Orion may conduct certain post-approval studies in the Territory. Orion will be responsible, at Orion’s sole cost and expense, for the commercialization of any Licensed Product in the Field in the Territory. Under the terms of the Orion Collaboration Agreement, we received a €25.0 million ($29.6 million) upfront payment from Orion in July 2021. In connection with the upfront fee, we agreed to provide Orion with the results of a planned genotoxicity study on the M2 metabolite of ganaxolone, a “Combined Micronucleus & Comet study in vivo.” In the event that the results of such study were positive, based on the criteria set forth in the study’s protocol, Orion would have had the right to terminate the Orion Collaboration Agreement within ninety ( 90 ) days after its receipt of the final report of such study, in which we would have been required to refund Orion seventy-five percent (75%) of the upfront fee. In the event of such termination and refund, Orion would have had no further rights pursuant to the oral and IV dose formulations of ganaxolone and the Orion Collaboration Agreement would have terminated and be of no further force or effect. In February 2022, the verified draft study report showed that no genotoxicity was found, as measured by formation of micronuclei in the bone marrow or comet morphology in the liver. These results were formalized in the final study report received in May 2022 and, as a result of the study’s findings, we are not required to refund Orion any of the upfront fee and Orion does not have the right to terminate the Orion Collaboration Agreement based upon the study outcome. We are eligible to receive up to an additional €97 million in research and development reimbursement and cash milestone payments based on specific clinical and commercial achievements, as well as tiered royalty payments based on net sales ranging from the low double-digits to high teens for the oral programs and the low double-digits to low 20s for the IV program. Also, as part of the overall arrangement, we have agreed to supply the Licensed Products to Orion at an agreed upon price. The Orion Collaboration Agreement shall remain effective until the date of expiration of the last to expire Royalty Term, which is defined as the period beginning on the date of the first commercial sale Licensed Product in such country and ending on the latest to occur of (a) the tenth (10th) anniversary of the first commercial sale of Licensed Product in such country, (b) the expiration of the last-to-expire licensed patent covering the manufacture, use or sale of such Licensed Product in such country, and (c) the expiration of regulatory exclusivity period, if any, for such Licensed Product in such country. The Orion Collaboration Agreement has a term of at least ten ( 10 In accordance with the guidance, we identified the following commitments under the arrangement: (i) exclusive rights to develop, use, sell, have sold, offer for sale and import any product comprised of Licensed Product (License), (ii) development and regulatory activities (Development and Regulatory Activities), and (iii) requirement to supply Orion with the Licensed Product at an agreed upon price (Supply of Licensed Product). We determined that these three commitments represent distinct performance obligations for purposes of recognizing revenue or reducing expense, which we will recognize such revenue or expense, as applicable, as we fulfill these performance obligations. At contract inception, we determined that the non-refundable portion of the upfront payment plus the research and development reimbursement constitutes the transaction price as of the outset of the Orion Collaboration Agreement. The refundable portion of the upfront payment and the future potential regulatory and development milestone payments were fully constrained at contract inception as the risk of significant revenue reversal related to these amounts had not yet been resolved. During the three months ended March 31, 2022, the refundable portion of the upfront payment was determined to be included in the transaction price as the final genotoxicity study on the M2 metabolite of ganaxolone was received as described above. The achievement of the future potential milestones is not within our control and is subject to certain research and development success and therefore carry significant uncertainty. We will reevaluate the likelihood of achieving these milestones at the end of each reporting period and adjust the transaction price in the period the risk is resolved. In addition, we will recognize any consideration related to sales-based milestones and royalties when the subsequent sales occur since those payments relate primarily to the License, which was delivered by us to Orion upon entering into the Orion Collaboration Agreement. We recorded $12.7 million of the $21.2 million refundable portion of the upfront payment as collaboration revenue in the three months ended March 31, 2022, and $9.5 million was recorded as a long-term liability as of March 31, 2022. The transaction price was allocated to the three performance obligations based on the estimated stand-alone selling prices at contract inception. The stand-alone selling price of the License was based on a discounted cash flow approach and considered several factors including, but not limited to, discount rate, development timeline, regulatory risks, estimated market demand and future revenue potential using an adjusted market approach. The stand-alone selling price of the Development and Regulatory Activities and the Supply of Licensed Product was estimated using the expected cost-plus margin approach. As of the agreement date in July 2021, we allocated the transaction price to the performance obligations as described below and recorded the $9.0 million transaction price associated with the License as revenue. During 2021, we amortized $0.1 million of the transaction price associated with the Development and Regulatory Services as a reduction of research and development costs. These reductions to transaction price resulted in a total contract liability of $6.6 million at December 31, 2021. In accordance with ASC 210-20, the contract liability of $6.6 million was offset by a contract asset of $7.2 million related to the reimbursement of research and development costs, resulting in a net contract asset of $0.6 million at December 31, 2021. Transaction Price and Net Contract Asset at December 31, 2021: Cumulative Collaboration Transaction Revenue Recognized Contract Price as of December 31, 2021 Liability License $ 8,987 $ 8,987 $ - Development and Regulatory Services 2,787 106 2,681 Supply of Licensed Product 3,943 - 3,943 $ 15,717 $ 9,093 6,624 Less Total Contract Asset 7,181 Net Contract Asset $ 557 During the three months ended March 31, 2022, the refundable portion of the upfront payment was determined to be included in the transaction price as the final genotoxicity study on the M2 metabolite of ganaxolone was received as described above. As such, the refundable portion of the upfront payment of €18.8 million ($21.2 million) was allocated to the purchase price as shown below, resulting in a total purchase price of $37.9 million. Of the $21.2 million refundable portion of the upfront payment, we recorded $12.7 million of collaboration revenue in the three months ended March 31, 2022. During the three months ended March 31, 2022, we amortized $0.4 million of the transaction price associated with the Development and Regulatory Services as a reduction of research and development costs. These reductions to the transaction price resulted in a total contract liability of $15.7 million at March 31, 2022. In accordance with ASC 210-20, the contract liability of $15.7 million is offset by a contract asset of $6.6 million related to the reimbursement of research and development costs, resulting in a net contract liability of $9.1 million at March 31, 2022. Transaction Price and Net Contract Liability at March 31, 2022: Cumulative Collaboration Transaction Price Revenue Recognized Contract As of March 31, 2022 as of March 31, 2022 Liability License $ 21,660 $ 21,660 $ - Development and Regulatory Services 6,717 481 6,236 Supply of Licensed Product 9,503 - 9,503 $ 37,880 $ 22,141 15,739 Less Total Contract Asset 6,626 Net Contract Liability $ 9,113 In 2021, we incurred $2.0 million of incremental costs in obtaining the Orion Collaboration Agreement. These contract acquisition costs were allocated consistent with the transaction price, resulting in $1.1 million of expense recorded to general and administrative expense commensurate with the recognition of the License performance obligation and $0.9 million recorded as capitalized contract costs, included in other current assets and other assets, which are being amortized as Development and Regulatory Services and Supply of Licensed Product obligations are met. We reevaluate the transaction price and the total estimated costs expected to be incurred to satisfy the performance obligations and adjusts the deferred revenue at the end of each reporting period. Such changes will result in a change to the amount of collaboration revenue recognized and deferred revenue. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2022 | |
Summary of Significant Accounting Policies | |
Basis of Presentation | Basis of Presentation The accompanying unaudited interim consolidated financial statements include the accounts of Marinus Pharmaceuticals, Inc. (a Delaware corporation) as well as the accounts of Marinus Pharmaceuticals Emerald Limited (an Ireland company incorporated in February 2021), a wholly owned subsidiary requiring consolidation. Marinus Pharmaceuticals Emerald Limited serves as a corporate presence in the European Union for regulatory purposes. The unaudited interim consolidated financial statements included herein have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). Accordingly, they do not include all information and disclosures necessary for a presentation of our financial position, results of operations and cash flows in conformity with generally accepted accounting principles in the U.S. (GAAP) for annual financial statements. In the opinion of management, these unaudited interim consolidated financial statements reflect all adjustments, consisting primarily of normal recurring accruals, necessary for a fair presentation of our financial position and results of operations and cash flows for the periods presented. The results of operations for interim periods are not necessarily indicative of the results for the full year. These unaudited interim consolidated financial statements should be read in conjunction with the audited financial statements for the year ended December 31, 2021 and accompanying notes thereto included in our Annual Report on Form 10-K filed with the SEC on March 24, 2022. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with 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 income and expenses during the reporting period. Actual results could differ from such estimates. |
Debt Issuance Costs | Debt Issuance Costs Debt issuance costs incurred in connection with Note payable (Note 8) are amortized to interest expense over the term of the respective financing arrangement using the effective-interest method. Debt issuance costs, net of related amortization are deducted from the carrying value of the related debt. |
Contract Liability | Contract Liability When consideration is received, or such consideration is unconditionally due, from a customer prior to completing our performance obligation to the customer under the terms of a contract, a contract liability is recorded. Contract liabilities expected to be recognized as revenue or a reduction of expense within the 12 months following the balance sheet date are classified as current liabilities. Contract liabilities not expected to be recognized as revenue within the 12 months following the balance sheet date are classified as long-term liabilities. In accordance with ASC 210-20, our contract liability is partially offset by a contract asset as further discussed in Note 9. |
Federal Contract Revenue | Federal Contract Revenue We recognize federal contract revenue from the BARDA Contract in the period in which the allowable research and development expenses are incurred, and receivables associated with this revenue are included within accounts receivable on our interim consolidated balance sheets. This revenue is not within the scope of ASC 606 – Revenue from contracts with customers. |
Collaboration and Licensing Revenue | Collaboration and Licensing Revenue We may enter into collaboration and licensing arrangements for research and development, manufacturing, and commercialization activities with counterparties for the development and commercialization of our product candidates. These arrangements may contain multiple components, such as (i) licenses, (ii) research and development activities, and (iii) the manufacturing of certain material. Payments pursuant to these arrangements may include non-refundable and refundable payments, payments upon the achievement of significant regulatory, development and commercial milestones, sales of product at certain agreed-upon amounts, and royalties on product sales. The amount of variable consideration is constrained until it is probable that the revenue is not at a significant risk of reversal in a future period. In determining the appropriate amount of revenue to be recognized as we fulfill our obligations under a collaboration agreement, we perform the following steps: (i) identification of the promised goods or services in the contract; (ii) determination of whether the promised goods or services are performance obligations, including whether they are capable of being distinct; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue as we satisfy each performance obligation. We must develop estimates and assumptions that require judgment to determine the underlying stand-alone selling price for each performance obligation, which determines how the transaction price is allocated among the performance obligations. The estimation of the stand-alone selling price may include such estimates as forecasted revenues and costs, development timelines, discount rates and probabilities of regulatory and commercial success. We also apply significant judgment when evaluating whether contractual obligations represent distinct performance obligations, allocating transaction price to performance obligations within a contract, determining when performance obligations have been met, assessing the recognition and future reversal of variable consideration and determining and applying appropriate methods of measuring progress for performance obligations satisfied over time. |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Fair Value Measurements | |
Summary of major categories of financial assets and liabilities measured at fair value on a recurring basis | The following fair value hierarchy table presents information about each major category of our financial assets and liabilities measured at fair value on a recurring basis (in thousands): Level 1 Level 2 Level 3 Total March 31, 2022 Assets Cash $ 34,128 $ — $ — $ 34,128 Money market funds (cash equivalents) 92,191 — — 92,191 Total assets $ 126,319 $ — $ — $ 126,319 December 31, 2021 Assets Cash $ 2,360 $ — $ — $ 2,360 Money market funds (cash equivalents) 120,567 — — 120,567 Total assets $ 122,927 $ — $ — $ 122,927 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Accrued Expenses | |
Schedule of accrued expenses | Accrued expenses consisted of the following (in thousands): March 31, December 31, 2022 2021 Payroll and related costs $ 3,360 $ 5,830 Clinical trials and drug development 8,765 8,217 Professional fees 1,431 1,311 Debt issuance costs and commitment fees 630 — Short-term lease liabilities 575 556 Other 104 293 Total accrued expenses $ 14,865 $ 16,207 |
Loss Per Share of Common Stock
Loss Per Share of Common Stock (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Loss Per Share of Common Stock | |
Schedule of antidilutive securities excluded from the computation of diluted weighted average shares outstanding | March 31, 2022 2021 Convertible preferred stock 915,000 950,600 Restricted stock awards and restricted stock units 541,670 22,000 Stock options 5,654,024 4,436,778 7,110,694 5,409,378 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Stock option | |
Schedule of total compensation cost recognized in the statement of operations | Total compensation cost recognized for all stock option awards in the statements of operations is as follows (in thousands): Three Months Ended March 31, 2022 2021 Research and development $ 1,179 $ 1,190 General and administrative 1,899 3,790 Total $ 3,078 $ 4,980 |
Restricted stock awards and RSUs | |
Schedule of total compensation cost recognized in the statement of operations | Total compensation cost recognized for all restricted stock awards and restricted stock units in the statements of operations is as follows (in thousands): Three Months Ended March 31, 2022 2021 Research and development $ 99 $ — General and administrative 202 55 Total $ 301 $ 55 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Leases | |
Schedule of maturities of operating lease liabilities | Maturities of operating lease liabilities as of March 31, 2022 were as follows (in thousands): Remaining nine months of 2022 $ 609 2023 823 2024 840 2025 642 Thereafter — 2,914 Less: imputed interest (510) Total lease liabilities $ 2,404 Current operating lease liabilities $ 575 Non-current operating lease liabilities 1,829 Total lease liabilities $ 2,404 |
Notes Payable (Tables)
Notes Payable (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Notes Payable | |
Summary of composition of Notes payable | The following table summarizes the composition of Notes payable as reflected on the consolidated balance sheet as of March 31, 2022 (in thousands): Gross proceeds $ 75,000 Contractual exit fee 1,500 Unamortized debt discount and issuance costs (6,573) Total $ 69,927 |
Schedule of maturities of Notes payable over the next five years | Gross proceeds $ 75,000 Contractual exit fee 1,500 Unamortized debt discount and issuance costs (6,573) Total $ 69,927 The aggregate maturities of Notes payable as of March 31, 2022 are as follows (in thousands): Remainder of 2022 $ — 2023 — 2024 11,250 2025 15,000 2026 and thereafter 48,750 Total $ 75,000 |
Collaboration Revenue (Tables)
Collaboration Revenue (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Collaboration Revenue | |
Schedule of allocation of the transaction price to the performance obligations | Cumulative Collaboration Transaction Revenue Recognized Contract Price as of December 31, 2021 Liability License $ 8,987 $ 8,987 $ - Development and Regulatory Services 2,787 106 2,681 Supply of Licensed Product 3,943 - 3,943 $ 15,717 $ 9,093 6,624 Less Total Contract Asset 7,181 Net Contract Asset $ 557 Cumulative Collaboration Transaction Price Revenue Recognized Contract As of March 31, 2022 as of March 31, 2022 Liability License $ 21,660 $ 21,660 $ - Development and Regulatory Services 6,717 481 6,236 Supply of Licensed Product 9,503 - 9,503 $ 37,880 $ 22,141 15,739 Less Total Contract Asset 6,626 Net Contract Liability $ 9,113 |
Description of the Business a_2
Description of the Business and Liquidity (Details) $ in Thousands, € in Millions | Jul. 30, 2021USD ($) | Jul. 30, 2021EUR (€) | May 11, 2021USD ($)tranche | Sep. 30, 2021USD ($) | Sep. 30, 2020USD ($) | Mar. 31, 2022USD ($)shares | Mar. 31, 2021USD ($) | Dec. 31, 2021USD ($)shares |
Liquidity | ||||||||
Net loss | $ 19,361 | $ 27,141 | ||||||
Accumulated deficit | 430,066 | $ 410,705 | ||||||
Proceeds from Lines of Credit | $ 75,000 | |||||||
Common stock, shares authorized | shares | 150,000,000 | 150,000,000 | ||||||
Oaktree Capital Management LP Credit Agreement | ||||||||
Liquidity | ||||||||
Term of loan facility | 5 years | |||||||
Maximum borrowing capacity available under the credit agreement | $ 125,000 | |||||||
Number of tranches | tranche | 5 | |||||||
Proceeds from Lines of Credit | $ 15,000 | $ 30,000 | $ 30,000 | |||||
Additional borrowing capacity available, subject to certain milestone events | $ 50,000 | |||||||
Oaktree Capital Management LP Credit Agreement | Funding of the tranche A- 2 term loans until the funding of the tranche B term loans | ||||||||
Liquidity | ||||||||
Minimum liquidity to be maintained | 15,000 | |||||||
BARDA Contract | ||||||||
Liquidity | ||||||||
Maximum amount to be awarded under the contract | $ 51,000 | |||||||
Contract base period | 2 years | |||||||
Amount of funding to be provided during contract base period | $ 21,000 | |||||||
Amount of additional funding to be provided following successful completion of clinical trial and preclinical studies in base period | 30,000 | |||||||
Cost sharing, amount | 33,000 | |||||||
Cost sharing, BARDA amount | $ 51,000 | |||||||
Contract period-of-performance | 5 years | |||||||
Collaboration Agreement with Orion | ||||||||
Liquidity | ||||||||
Upfront fee received | $ 29,600 | € 25 | ||||||
R&D reimbursement and cash milestone payments to be received | € | € 97 | |||||||
Number of days from receipt of the final report, in which the collaboration agreement may be terminated | 90 days | 90 days | ||||||
Percentage of upfront fee which must be refunded in the event of termination | 75.00% | |||||||
Term Loan Tranche B | Oaktree Capital Management LP Credit Agreement | ||||||||
Liquidity | ||||||||
Proceeds from Lines of Credit | $ 30,000 | |||||||
Common Stock | ||||||||
Liquidity | ||||||||
Issuance of common stock (in shares) | shares | 123,255 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - Recurring basis - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Assets | ||
Total assets | $ 126,319 | $ 122,927 |
Cash | ||
Assets | ||
Cash and cash equivalents, fair value | 34,128 | 2,360 |
Money market funds | ||
Assets | ||
Cash and cash equivalents, fair value | 92,191 | |
Investments | 120,567 | |
Level 1 | ||
Assets | ||
Total assets | 126,319 | 122,927 |
Level 1 | Cash | ||
Assets | ||
Cash and cash equivalents, fair value | 34,128 | 2,360 |
Level 1 | Money market funds | ||
Assets | ||
Cash and cash equivalents, fair value | $ 92,191 | |
Investments | $ 120,567 |
Accrued Expenses (Details)
Accrued Expenses (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Accrued Expenses | ||
Payroll and related costs | $ 3,360 | $ 5,830 |
Clinical trials and drug development | 8,765 | 8,217 |
Professional fees | 1,431 | 1,311 |
Debt issuance costs and commitment fees | 630 | |
Short-term lease liabilities | 575 | 556 |
Other | 104 | 293 |
Total accrued expenses | $ 14,865 | $ 16,207 |
Loss Per Share of Common Stoc_2
Loss Per Share of Common Stock (Details) - shares | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Loss per share of common stock | ||
Antidilutive securities excluded from the computation of diluted weighted average shares outstanding (in shares) | 7,110,694 | 5,409,378 |
Convertible preferred stock | ||
Loss per share of common stock | ||
Antidilutive securities excluded from the computation of diluted weighted average shares outstanding (in shares) | 915,000 | 950,600 |
Restricted stock awards and RSUs | ||
Loss per share of common stock | ||
Antidilutive securities excluded from the computation of diluted weighted average shares outstanding (in shares) | 541,670 | 22,000 |
Stock options | ||
Loss per share of common stock | ||
Antidilutive securities excluded from the computation of diluted weighted average shares outstanding (in shares) | 5,654,024 | 4,436,778 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - USD ($) $ / shares in Units, $ in Thousands | Mar. 29, 2022 | Mar. 31, 2022 | Mar. 31, 2021 | Jan. 01, 2022 | Dec. 31, 2021 |
Stock option and incentive plans | |||||
Total compensation cost | $ 3,078 | $ 4,980 | |||
Shares | |||||
Number of common shares issued for each convertible Series A preferred stock | 915,000 | ||||
Ovid License Agreement | |||||
Stock option and incentive plans | |||||
Stock Issued During Period, Shares, New Issues | 123,255 | ||||
Series A Preferred Stock | |||||
Shares | |||||
Preferred stock, shares outstanding | 4,575 | 4,575 | |||
Common Stock | |||||
Stock option and incentive plans | |||||
Stock Issued During Period, Shares, New Issues | 123,255 | ||||
Stock option | |||||
Stock Options | |||||
Outstanding (in shares) | 5,654,024 | ||||
Outstanding, weighted-average exercise price (in dollars per share) | $ 11.66 | ||||
Granted (in shares) | 1,341,399 | ||||
Granted (in dollars per share) | $ 10.47 | ||||
Restricted stock awards and RSUs | |||||
Stock option and incentive plans | |||||
Total compensation cost | $ 301 | 55 | |||
Stock Options | |||||
Outstanding (in shares) | 22,625 | ||||
Shares | |||||
Issued (in shares) | 515,645 | ||||
Outstanding (in shares) | 519,045 | ||||
Restricted stock awards and RSUs | Research and development. | |||||
Stock option and incentive plans | |||||
Total compensation cost | $ 99 | ||||
Restricted stock awards and RSUs | General and administrative | |||||
Stock option and incentive plans | |||||
Total compensation cost | $ 202 | 55 | |||
2005 Plan | |||||
Stock option and incentive plans | |||||
Common stock reserved for issuance (in shares) | 0 | ||||
2005 Plan | Stock option | |||||
Stock Options | |||||
Outstanding (in shares) | 577 | ||||
2014 Plan | |||||
Stock option and incentive plans | |||||
Common stock reserved for issuance (in shares) | 816,377 | 2,343,330 | |||
2014 Plan | Research and development. | |||||
Stock option and incentive plans | |||||
Total compensation cost | $ 1,179 | 1,190 | |||
2014 Plan | General and administrative | |||||
Stock option and incentive plans | |||||
Total compensation cost | $ 1,899 | $ 3,790 | |||
2014 Plan | Stock option | |||||
Stock Options | |||||
Outstanding (in shares) | 4,072,818 | ||||
Granted (in shares) | 1,204,388 | ||||
Equity Incentive Plan, Employee Inducements | Stock option | |||||
Stock Options | |||||
Outstanding (in shares) | 1,580,629 | ||||
Granted (in shares) | 137,011 |
Leases (Details)
Leases (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Leases | |||
Operating lease agreement term | 78 months | ||
Operating lease renewal term | 60 months | ||
Weighted average remaining lease term | 42 months | ||
Right-of-use assets | $ 1,600 | $ 1,700 | |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Other Assets, Noncurrent | Other Assets, Noncurrent | |
Operating lease liabilities | $ 2,404 | $ 2,500 | |
Operating Lease, Liability, Statement of Financial Position [Extensible List] | Accrued Liabilities, Current, Other Accrued Liabilities, Noncurrent | Accrued Liabilities, Current, Other Accrued Liabilities, Noncurrent | |
Total lease costs | $ 200 | $ 100 | |
Weighted-average incremental borrowing rate used to determine right-of-use assets and lease liabilities | 11.00% | ||
Impairment losses of ROU assets | $ 0 | $ 0 | |
Maturities of operating lease liabilities | |||
Remaining three months of 2021 | 609 | ||
2022 | 823 | ||
2023 | 840 | ||
2024 | 642 | ||
Total lease payments | 2,914 | ||
Less: imputed interest | (510) | ||
Total lease liabilities | 2,404 | $ 2,500 | |
Current operating lease liabilities | 575 | ||
Non-current operating lease liabilities | $ 1,829 | ||
Maximum | |||
Leases | |||
Short-term operating lease costs | $ 100 |
Notes Payable - Narratives (Det
Notes Payable - Narratives (Details) | May 11, 2021USD ($)tranche | May 11, 2011USD ($) | Sep. 30, 2021USD ($) | Mar. 31, 2022USD ($) |
Debt Instrument [Line Items] | ||||
Proceeds from line of credit | $ 75,000,000 | |||
Contractual exit fee | 1,500,000 | |||
Interest Expense | 1,692,000 | |||
Amortization of debt issuance costs | 282,000 | |||
Oaktree Capital Management LP Credit Agreement | ||||
Debt Instrument [Line Items] | ||||
Term of loan facility | 5 years | |||
Maximum borrowing capacity available under the credit agreement | $ 125,000,000 | |||
Number of tranches | tranche | 5 | |||
Additional borrowing capacity available, subject to certain milestone events | $ 50,000,000 | |||
Proceeds from line of credit | $ 15,000,000 | $ 30,000,000 | 30,000,000 | |
Accrued interest rate (as a percent) | 11.50% | |||
Percentage of periodic principal payment | 5.00% | |||
Upfront fee (as a percent) | 2.00% | |||
Commitment fee accrual period | 120 days | |||
Debt Instrument Commitment Fee | $ 0.75 | |||
Percentage of term loan exit fees | 2.00% | |||
Payment of Debt Commitment Fee | 100,000 | |||
Debt issuance costs | $ 4,400,000 | 1,200,000 | 1,800,000 | |
Contractual exit fee | 300,000 | $ 600,000 | ||
Interest Expense | 1,700,000 | |||
Interest on term loan | 1,300,000 | |||
Amortization of debt issuance costs | 300,000 | |||
Oaktree Capital Management LP Credit Agreement | Maximum | ||||
Debt Instrument [Line Items] | ||||
Debt Instrument Commitment Fee | 100,000 | |||
Contractual exit fee | 600,000 | |||
Oaktree Capital Management LP Credit Agreement | Funding of the tranche A- 2 term loans until the funding of the tranche B term loans | ||||
Debt Instrument [Line Items] | ||||
Minimum liquidity to be maintained | 15,000,000 | |||
Oaktree Capital Management LP Credit Agreement | Funding date of the tranche B term loans until the maturity of the Term Loans | ||||
Debt Instrument [Line Items] | ||||
Minimum liquidity to be maintained | $ 15,000,000 | |||
Oaktree Capital Management LP Credit Agreement | Scenario Of Prepayment On Or Before May 11, 2023 | ||||
Debt Instrument [Line Items] | ||||
Prepayment premium (as a percent) | 4.00% | |||
Oaktree Capital Management LP Credit Agreement | Scenario Of Prepayment Occurs Between May 11, 2023 To May 11, 2024 | ||||
Debt Instrument [Line Items] | ||||
Prepayment premium (as a percent) | 4.00% | |||
Oaktree Capital Management LP Credit Agreement | Scenario Of Prepayment Between May 11, 2024 To May 11, 2025 | ||||
Debt Instrument [Line Items] | ||||
Prepayment premium (as a percent) | 2.00% | |||
Oaktree Capital Management LP Credit Agreement | Scenario Of Prepayment After May 11, 2025 | ||||
Debt Instrument [Line Items] | ||||
Prepayment premium (as a percent) | 0.00% | |||
Oaktree Capital Management LP Credit Agreement | Prepayment occurs on or before May 11, 2022 | ||||
Debt Instrument [Line Items] | ||||
Prepayment premium (as a percent) | 12.50% | |||
Oaktree Capital Management LP Credit Agreement | Prepayment occurs after May 11, 2022 but on or before May 11, 2023 | ||||
Debt Instrument [Line Items] | ||||
Prepayment premium (as a percent) | 10.00% | |||
Oaktree Capital Management LP Credit Agreement | Term Loans Tranche A-1 | ||||
Debt Instrument [Line Items] | ||||
Proceeds from line of credit | $ 15,000,000 | |||
Oaktree Capital Management LP Credit Agreement | Term Loans Tranche A-2 | ||||
Debt Instrument [Line Items] | ||||
Proceeds from line of credit | $ 30,000,000 | 30,000,000 | ||
Oaktree Capital Management LP Credit Agreement | Term Loan Tranche B | ||||
Debt Instrument [Line Items] | ||||
Proceeds from line of credit | 30,000,000 | |||
Debt Instrument Commitment Fee | 100,000 | |||
Oaktree Capital Management LP Credit Agreement | Term Loan Tranche B | Maximum | ||||
Debt Instrument [Line Items] | ||||
Debt Instrument Commitment Fee Accrued | $ 100,000 | |||
Oaktree Capital Management LP Credit Agreement | Term Loan Tranche C | ||||
Debt Instrument [Line Items] | ||||
Additional borrowing capacity available, subject to certain milestone events | 25,000,000 | |||
Gross proceeds from sublicense, minimum | 40,000,000 | |||
Net proceeds from sublicense, minimum | 36,000,000 | |||
Oaktree Capital Management LP Credit Agreement | Term Loan Tranche D | ||||
Debt Instrument [Line Items] | ||||
Additional borrowing capacity available, subject to certain milestone events | 25,000,000 | |||
Net product revenue, minimum | $ 50,000,000 | |||
Net product revenue, consecutive earning period | 6 months |
Notes Payable - Composition of
Notes Payable - Composition of debt (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Notes Payable | ||
Gross proceeds | $ 75,000 | |
Contractual exit fee | 1,500 | |
Unamortized debt discount and issuance costs | (6,573) | |
Total | $ 69,927 | $ 40,809 |
Notes Payable - Debt maturities
Notes Payable - Debt maturities (Details) $ in Thousands | Mar. 31, 2022USD ($) |
Notes Payable | |
2024 | $ 11,250 |
2025 | 15,000 |
2026 and thereafter | 48,750 |
Total | $ 75,000 |
Collaboration Revenue - Narrati
Collaboration Revenue - Narrative (Details) $ in Thousands, € in Millions | Jul. 30, 2021USD ($) | Jul. 30, 2021EUR (€) | Mar. 31, 2022USD ($) | Dec. 31, 2021USD ($) | Jul. 31, 2021USD ($) |
License and Collaboration Revenue | |||||
Collaboration revenue | $ 12,673 | ||||
Contract with Customer, Contract Liability Net of Contract Asset | 9,113 | ||||
Less Total Contract Asset | 6,626 | $ 7,181 | |||
Collaboration Agreement with Orion | |||||
License and Collaboration Revenue | |||||
Upfront fee received | $ 29,600 | € 25 | |||
Number of days from receipt of the final report, in which the collaboration agreement may be terminated | 90 days | 90 days | |||
Percentage of upfront fee which must be refunded in the event of termination | 75.00% | ||||
Amount of payment receivable upon achievement of specific clinical and commercial achievements | € | € 97 | ||||
Term of collaboration agreement | 10 years | 10 years | |||
Collaboration revenue | 12,700 | ||||
Contract with Customer, Refund Liability, Noncurrent | 9,500 | ||||
Transaction Price | 37,880 | 15,717 | $ 9,000 | ||
Contract with Customer, Contract Liability Net of Contract Asset | 9,100 | ||||
Less Total Contract Asset | $ 6,600 | $ 7,200 |
Collaboration Revenue - Allocat
Collaboration Revenue - Allocation of the transaction price to the performance obligations (Details) $ in Thousands, € in Millions | Jul. 30, 2021USD ($)item | Jul. 30, 2021EUR (€)item | Mar. 31, 2022USD ($) | Dec. 31, 2021USD ($) | Mar. 31, 2022EUR (€) | Jul. 31, 2021USD ($) |
License and Collaboration Revenue | ||||||
Contract Liability | $ 15,739 | $ 6,624 | ||||
Less Total Contract Asset | 6,626 | 7,181 | ||||
Net Contract Asset | 557 | |||||
Net Contract Liability | 9,113 | |||||
Cost of IP license fee | 1,169 | |||||
Development and Regulatory Services | ||||||
License and Collaboration Revenue | ||||||
Contract Liability | 6,236 | 2,681 | ||||
Supply of License Product | ||||||
License and Collaboration Revenue | ||||||
Contract Liability | 9,503 | 3,943 | ||||
Collaboration Agreement with Orion | ||||||
License and Collaboration Revenue | ||||||
Number of performance obligations | item | 3 | 3 | ||||
Refundable portion of the upfront payment | 21,200 | € 18.8 | ||||
Transaction Price | 37,880 | 15,717 | $ 9,000 | |||
Cumulative Collaboration Revenue Recognized | 22,141 | 9,093 | ||||
Contract Liability | 15,700 | 6,600 | ||||
Less Total Contract Asset | 6,600 | 7,200 | ||||
Net Contract Asset | 600 | |||||
Net Contract Liability | 9,100 | |||||
Incremental costs incurred in obtaining the agreement | 2,000 | |||||
Contract acquisition costs included in general and administrative expense | 1,100 | |||||
Capitalized contract costs | 900 | |||||
Upfront fee received | $ 29,600 | € 25 | ||||
Collaboration Agreement with Orion | License Revenue | ||||||
License and Collaboration Revenue | ||||||
Transaction Price | 21,660 | 8,987 | ||||
Cumulative Collaboration Revenue Recognized | 21,660 | 8,987 | ||||
Collaboration Agreement with Orion | Development and Regulatory Services | ||||||
License and Collaboration Revenue | ||||||
Amortization of transaction price as a reduction of research and development costs | 400 | 100 | ||||
Transaction Price | 6,717 | 2,787 | ||||
Cumulative Collaboration Revenue Recognized | 481 | 106 | ||||
Collaboration Agreement with Orion | Supply of License Product | ||||||
License and Collaboration Revenue | ||||||
Transaction Price | $ 9,503 | $ 3,943 |