Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Mar. 07, 2017 | Jun. 30, 2016 | |
Document and Entity Information | |||
Entity Registrant Name | KALOBIOS PHARMACEUTICALS INC | ||
Entity Central Index Key | 1,293,310 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2016 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Public Float | $ 24,417,832 | ||
Entity Common Stock, Shares Outstanding | 14,977,397 | ||
Document Fiscal Year Focus | 2,016 | ||
Document Fiscal Period Focus | FY |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 2,906 | $ 8,431 |
Prepaid expenses and other current assets | 1,643 | 1,963 |
Total current assets | 4,549 | 10,394 |
Property and equipment, net | 68 | 288 |
Restricted cash | 101 | 193 |
Other assets | 271 | |
Total assets | 4,718 | 11,146 |
Current liabilities: | ||
Accounts payable | 4,072 | |
Accrued expenses | 736 | |
Term loan payable | 3,016 | |
Total current liabilities | 7,824 | |
Liabilities subject to compromise | 5,414 | |
Notes payable to vendors | 1,273 | |
Total liabilities | 9,097 | 5,414 |
Stockholders' equity (deficit): | ||
Common stock, $0.001 par value: 85,000,000 shares authorized at December 31, 2016 and 2015; 14,977,397 and 4,450,994 shares issued and outstanding at December 31, 2016 and 2015, respectively | 15 | 4 |
Additional paid-in capital | 236,216 | 219,319 |
Accumulated deficit | (240,610) | (213,591) |
Total stockholders' equity (deficit) | (4,379) | 5,732 |
Total liabilities and stockholders' equity (deficit) | $ 4,718 | $ 11,146 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2016 | Dec. 31, 2015 |
Statement of Financial Position [Abstract] | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 85,000,000 | 85,000,000 |
Common stock, shares issued | 14,977,397 | 4,450,994 |
Common stock, shares outstanding | 14,977,397 | 4,450,994 |
Consolidated Statements of Oper
Consolidated Statements of Operations and Comprehensive Loss - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Operating expenses: | ||
Research and development | $ 10,449 | $ 16,721 |
General and administrative | 8,376 | 14,296 |
Litigation accrual expense | 3,335 | |
Total operating expenses | 18,825 | 34,352 |
Loss from operations | (18,825) | (34,352) |
Other (expense) income: | ||
Interest expense | (131) | (842) |
Interest income | 29 | |
Other income (expense), net | 125 | (213) |
Reorganization items, net | (8,188) | |
Net loss | (27,019) | (35,378) |
Other comprehensive income: | ||
Net unrealized gains on marketable securities | 8 | |
Comprehensive loss | $ (27,019) | $ (35,370) |
Basic and diluted net loss per common share | $ (2.78) | $ (8.57) |
Weighted average common shares outstanding used to calculate basic and diluted net loss per common share | 9,707,877 | 4,125,009 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity (Deficit) - USD ($) $ in Thousands | Common Stock [Member] | Additional Paid-In Capital [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Accumulated Deficit [Member] | Total |
Balances at Dec. 31, 2014 | $ 4 | $ 202,830 | $ (8) | $ (178,213) | $ 24,613 |
Balances (in shares) at Dec. 31, 2014 | 4,124,004 | ||||
Issuance of common stock, net of issuance costs | 8,218 | 8,218 | |||
Issuance of common stock, net of issuance costs (in shares) | 326,698 | ||||
Issuance of common stock upon ESPP conversion | 1 | 1 | |||
Issuance of common stock upon ESPP conversion (in shares) | 750 | ||||
Obligation to issue common stock in settlement of litigation | 2,835 | 2,835 | |||
Issuance of warrants in exchange for services | 2,507 | 2,507 | |||
Stock-based compensation expense | 1,971 | 1,971 | |||
Modification of stock options related to executive retirement | 479 | 479 | |||
Modification of stock options related to restructuring activities | 480 | 480 | |||
Settlement of fractional shares upon reverse split | (2) | (2) | |||
Settlement of fractional shares upon reverse split (in shares) | (458) | ||||
Comprehensive loss | 8 | (35,378) | (35,370) | ||
Balances at Dec. 31, 2015 | $ 4 | 219,319 | (213,591) | 5,732 | |
Balances (in shares) at Dec. 31, 2015 | 4,450,994 | ||||
Issuance of common stock to officer and directors | $ 1 | 1,451 | 1,452 | ||
Issuance of common stock to officer and directors (in shares) | 323,155 | ||||
Issuance of common stock, net of issuance costs | $ 7 | 10,125 | 10,132 | ||
Issuance of common stock, net of issuance costs (in shares) | 7,147,035 | ||||
Issuance of common stock in settlement of litigation | $ 1 | (1) | |||
Issuance of common stock in settlement of litigation (in shares) | 631,358 | ||||
Issuance of common stock for services | 198 | 198 | |||
Issuance of common stock for services (in shares) | 65,000 | ||||
Issuance of common stock upon exercise of options | 10 | 10 | |||
Issuance of common stock upon exercise of options (in shares) | 5,625 | ||||
Issuance of common stock upon vesting of restricted stock units | |||||
Issuance of common stock upon vesting of restricted stock units (in shares) | 3,750 | ||||
Issuance of warrants in connection with acquisition of licenses | 361 | 361 | |||
Issuance of warrants in exchange for services | 40 | 40 | |||
Issuance of warrants in exchange for services (in shares) | |||||
Conversion of notes payable and related accrued interest and fees to common stock | $ 2 | 3,385 | 3,387 | ||
Conversion of notes payable and related accrued interest and fees to common stock (in shares) | 2,350,480 | ||||
Beneficial conversion feature | 484 | 484 | |||
Stock-based compensation expense | 844 | 844 | |||
Comprehensive loss | (27,019) | (27,019) | |||
Balances at Dec. 31, 2016 | $ 15 | $ 236,216 | $ (240,610) | $ (4,379) | |
Balances (in shares) at Dec. 31, 2016 | 14,977,397 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Operating activities: | ||
Net loss | $ (27,019) | $ (35,378) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 102 | 197 |
Gain on lease termination | (227) | |
Noncash interest expense | 69 | 190 |
Financing derivative | 252 | |
Reorganization items related to debtor-in-possession financing | 1,627 | |
Amortization of premium on marketable securities | 130 | |
Stock based compensation expense | 844 | 1,971 |
Gain on extinguishment of long-term debt | (61) | |
Loss (gain) on sale of property and equipment | 22 | (56) |
Modification of stock options related to executive retirement | 479 | |
Modification of stock options related to restructuring activities | 480 | |
Issuance of warrants in exchange for services | 40 | 2,507 |
Issuance of warrants in connection with acquisition of licenses | 361 | |
Issuance of common stock in exchange for services | 198 | |
Issuance of common stock to officer and directors | 1,452 | |
Obligation to issue common stock in settlement of litigation | 2,835 | |
Changes in operating assets and liabilities: | ||
Prepaid expenses and other assets | 592 | (674) |
Accounts payable | 4,474 | 2,465 |
Accrued expenses | (25) | (4,400) |
Liabilities subject to compromise | (3,471) | |
Net cash used in operating activities | (20,961) | (29,063) |
Investing activities: | ||
Purchase of marketable securities | (3,703) | |
Proceeds from maturities of marketable securities | 33,371 | |
Purchases of property and equipment | (136) | |
Proceeds from sale of property and equipment | 11 | 121 |
Changes in restricted cash | 92 | 444 |
Net cash provided by investing activities | 103 | 30,097 |
Financing activities: | ||
Increase in restricted cash for notes payable | (8,291) | |
Net proceeds from issuance of common stock | 10,132 | 8,219 |
Net proceeds of stock option exercise | 10 | |
Net proceeds from notes payable | 2,993 | |
Net proceeds from convertible notes payable | 2,198 | |
Principal payments under notes payable | (3,452) | |
Settlement of fractional shares upon reverse split | (2) | |
Net cash provided by (used in) financing activities | 15,333 | (3,526) |
Net decrease in cash and cash equivalents | (5,525) | (2,492) |
Cash and cash equivalents, beginning of period | 8,431 | 10,923 |
Cash and cash equivalents, end of period | 2,906 | 8,431 |
Supplemental cash flow disclosure: | ||
Cash paid for interest | 685 | |
Supplemental disclosure of non-cash financing activities: | ||
Principal payments under notes payable from restricted cash | ||
Supplemental disclosure of non-cash investing and financing activities: | ||
Principal payments under notes payable from restricted cash | 7,337 | |
Conversion of notes payable and related accrued interest and fees to common stock | 3,387 | |
Obligation to issue common stock in settlement of litigation | 2,835 | |
Issuance of warrants in connection with acquisition of licenses | 361 | |
Issuance of warrants in exchange for services | 40 | 2,507 |
Issuance of common stock in exchange for services | 198 | |
Issuance of common stock to officer and directors | 1,452 | |
Issuance of notes payable to vendors | $ 1,273 |
Organization and Description of
Organization and Description of Business | 12 Months Ended |
Dec. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of Operations | 1. Organization and Description of Business Description of the Business KaloBios Pharmaceuticals, Inc. (the “Company”) is a biopharmaceutical company focused on developing medicines for patients with neglected and rare diseases, with an ancillary focus on pediatric conditions, and on executing its Responsible Pricing Model in the commercialization of the Company’s product candidates that may be approved. The Company’s lead product candidate is benznidazole for the treatment of Chagas disease, a parasitic illness that can lead to long-term heart, intestinal and neurological problems. As more fully described in Note 6, the Company acquired certain worldwide rights to benznidazole on June 30, 2016. The Company is developing one of its proprietary monoclonal antibodies, lenzilumab (formerly known as KB003), for the treatment of chronic myelomonocytic leukemia, and potentially for the treatment of juvenile myelomonocytic leukemia (JMML), both of which are rare hematologic cancers with high unmet medical need. The Company is exploring partnering opportunities to enable development of another of its proprietary monoclonal antibodies, ifabotuzumab (formerly known as KB004), for the treatment of certain rare solid and hematologic cancers. With a focus on neglected, rare and orphan diseases, the Company believes that it has the opportunity to benefit from various regulatory incentives, such as orphan drug exclusivity, breakthrough therapy designation, fast track designation, accelerated approval, priority review and priority review vouchers, where available, that provide for certain periods of exclusivity, expedited review and/or other benefits. Liquidity and Going Concern The Company has undergone a significant transformation in the last year. As a result of challenges facing it at the time, on December 29, 2015, the Company filed a voluntary petition for bankruptcy protection under Chapter 11 of Title 11 of the U.S. Bankruptcy Code. On June 30, 2016, the Company’s Second Amended Plan of Reorganization, dated May 9, 2016, as amended (the “Plan”), became effective and the Company emerged from its Chapter 11 bankruptcy proceedings. Refer to Note 2 for additional details regarding the Company’s bankruptcy proceedings. The Company was incorporated on March 15, 2000 in California and reincorporated as a Delaware corporation in September 2001. All of the Company’s assets are located in California. The Company has incurred significant losses and had an accumulated deficit of $240.6 million as of December 31, 2016. The Company has financed its operations primarily through the sale of equity securities, debt financings, interest income earned on cash and cash equivalents, grants and the payments received under its agreements with Novartis Pharma AG and Sanofi Pasteur S.A. (“Sanofi”). The Company completed its initial public offering (“IPO”) in February 2013. To date, none of the Company’s product candidates have been approved for sale and therefore the Company has not generated any revenue from product sales. Management expects operating losses to continue for the foreseeable future. As a result, the Company will continue to require additional capital through equity offerings, debt financing and/or payments under new or existing licensing or collaboration agreements. If sufficient funds are not available on acceptable terms when needed, the Company could be required to significantly reduce its operating expenses and delay, reduce the scope of, or eliminate one or more of its development programs. The Company’s ability to access capital when needed is not assured and, if not achieved on a timely basis, could materially harm its business, financial condition and results of operations. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. T he for the year ended December 31, 2016 were prepared on the basis of a going concern, which contemplates that the Company will be able to realize assets and discharge liabilities in the normal course of business. The ability of the Company to meet its total liabilities of $9.1 million at December 31, 2016, and to continue as a going concern is dependent upon the availability of future funding. The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. Delisting of Common Stock On January 13, 2016, the Company’s common stock was suspended from the Nasdaq Global Market and began trading on the over-the-counter market under the KBIOQ symbol. On January 26, 2016, NASDAQ filed a Form 25 with the Securities and Exchange Commission to complete the delisting of the common stock, and the delisting was effective on February 5, 2016. On June 30, 2016, upon emergence from bankruptcy, the ticker symbol for the trading of the Company’s common stock on the over-the-counter market reverted back to KBIO. |
Chapter 11 Filing
Chapter 11 Filing | 12 Months Ended |
Dec. 31, 2016 | |
Financial Statement Presentation While in Chapter 11 [Abstract] | |
Chapter 11 Filing | 2. Chapter 11 Filing On December 29, 2015, the Company filed a voluntary petition for bankruptcy protection under Chapter 11 of the U.S. Bankruptcy Code. The filing was made in the United States Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”) (Case No. 15-12628 (LSS)). In connection with financing efforts related to the Company’s bankruptcy proceedings, on April 1, 2016, the Company entered into a Debtor-in-Possession Credit and Security Agreement (the “Credit Agreement”) with a group of lenders (the “DIP Lenders”), pursuant to which the Company received $3 million in funds for working capital, bankruptcy-related costs, costs related to its plan of reorganization, payment of certain fees to the DIP Lenders and other costs associated with the ordinary course of business. Funds received under the Credit Agreement bore interest at a rate of 12% and were due and payable upon the Effective Date of the Plan, as defined below. Payment due under the Credit Agreement was convertible into shares of the Company’s common stock, with share amounts subject to calculation as provided in the Credit Agreement. On April 1, 2016, the Company also entered into a Securities Purchase Agreement (the “SPA”) with the DIP Lenders. The SPA provided for the sale of the Company’s common stock, with share amounts subject to calculation as provided in the SPA, in respect of exit financing in the amount of $11,000,000 to be received upon the Effective Date of the Plan, as defined below. Plan of Reorganization On May 9, 2016, the Company filed with the Bankruptcy Court the Plan and related amended disclosure statement pursuant to Chapter 11 of the Bankruptcy Code. On June 16, 2016, the Bankruptcy Court entered an order confirming the Plan. The Plan became effective on June 30, 2016 (the “Effective Date”) and the Company emerged from its Chapter 11 bankruptcy proceedings. In connection with such emergence, the Company consummated the transactions and other items described below. · Pursuant to the SPA and in repayment of its obligations under the Credit Agreement, the Company issued an aggregate of 9,497,515 shares of its common stock to the DIP Lenders. · The Company became obligated to issue 327,608 shares of common stock to the plaintiffs in litigation related to the Company’s 2015 private financing transaction in accordance with the settlement stipulation discussed below. The Company recorded an obligation in stockholders’ equity to issue the related shares and recorded the related expense of approximately $1.5 million as of December 31, 2015. As of December 31, 2016, all of the shares of common stock related to this settlement stipulation had been issued. · The Company reserved 300,000 shares of common stock for issuance to the plaintiffs in class action litigation related to the events surrounding the Company’s former Chairman and Chief Executive Officer. The Company recorded an obligation in stockholders’ equity to issue the related shares and recorded the related expense of approximately $1.3 million as of December 31, 2015. As of December 31, 2016, all of the shares related to this settlement stipulation had been issued. · The Company became obligated to issue 3,750 shares of common stock to a former director in satisfaction of claims against the Company. The Company recorded an obligation in stockholders’ equity to issue the related shares and recorded the related expense of approximately $16,000 as of December 31, 2015. As of December 31, 2016, all of the shares related to this settlement stipulation had been issued. · The Company reserved for issuance shares of common stock in an amount as yet to be determined in connection with the settlement of certain other claims and interests as set forth in the Plan. As of December 31, 2016, management does not believe the issuance of additional common stock for any such claims is probable. As such, no accrual has been made in the Consolidated Financial Statements. · The Company issued promissory notes in an aggregate principal amount of approximately $1.2 million to certain vendors in accordance with the Plan. The notes are unsecured, bear interest at 10% per annum and are due and payable in full, including principal and accrued interest on June 30, 2019. As of December 31, 2016, the Company has accrued $61,000 in interest expense related to these promissory notes. · The Company issued an aggregate of 323,155 shares of common stock to Cameron Durrant, Ronald Barliant, and David Moradi pursuant to an order by the Bankruptcy Court approving a one-time equity award for the Company’s Chief Executive Officer and two other directors. The Company recorded a charge of $1,451,000 representing the fair value of the shares issued and classified $700,000 and $751,000 as Reorganization items, net and General and administrative expenses, respectively. Bankruptcy Claims Administration On February 29, 2016, the Company filed its schedules of assets and liabilities and statement of financial affairs (the “Schedules”) with the Bankruptcy Court. The Bankruptcy Court entered an order setting April 1, 2016 as the deadline for filing proofs of claim for creditors other than governmental units and June 27, 2016 as the bar date for filing proofs of claim by governmental units (together, the “Bar Date”). The Bar Date is the date by which non-government claims against the Company relating to the period prior to the commencement of the Company's Chapter 11 case were required to be filed if such claims were not listed in liquidated, non-contingent and undisputed amounts in the Schedules, or if the claimant disagrees with the amount, characterization or classification of its claim as reflected in the Schedules. Claims that are subject to the Bar Date and that were not filed on or prior to the Bar Date are barred from participating in any distribution that may be made under the Plan. As of the Effective Date, approximately 195 proofs of claim were outstanding (including claims that were previously identified on the Schedules) totaling approximately $32 million. Prior to the Bar Date, certain investors filed a class action claim in the amount of $20 million in connection with events surrounding the Company’s former Chairman and Chief Executive Officer. On June 15, 2016, a settlement stipulation related to the class action suit was approved under order of the Bankruptcy Court. The settlement stipulation required the Company to issue 300,000 shares of common stock and submit a payment of $250,000 to the claimants. See Note 14 for additional information on this matter and settlement. Separately, a claim was filed by certain investors in the Company’s 2015 private financing transaction totaling approximately $6.9 million. On May 9, 2016, a settlement stipulation related to this suit was approved under order of the Bankruptcy Court. The settlement stipulation required the Company to issue 327,608 shares of common stock and submit a payment of $250,000 to an escrow account on behalf of the claimants. See Note 14 for additional information on this matter and settlement. As of December 31, 2015, the Company recorded an obligation in Additional paid-in capital to issue the related shares totaling approximately $2.8 million and recorded the cash liability of $500,000 in Liabilities subject to compromise in the accompanying Condensed Consolidated Balance Sheets. Excluding these stipulated claims, all other proofs of claim amount to approximately $5.1 million. As of December 31, 2015, the Company recorded a liability of approximately $4.5 million, which represents its estimate of the amount expected to be allowed by the Bankruptcy Court, in Liabilities subject to compromise in the accompanying Consolidated Balance Sheet. In addition, the Company also had liabilities related to accrued compensation and deferred rent, totaling approximately $0.4 million, included in Liabilities subject to compromise in the accompanying Consolidated Balance Sheet, as of December 31, 2015. As of June 30, 2016, the Company emerged from bankruptcy. The Company expects the amounts remaining in Liabilities subject to compromise as of the Effective Date to be paid in accordance with the Plan. Accordingly, as of December 31, 2016, Liabilities subject to compromise have been reduced to zero and reclassified according to their payment terms. In March 2016, the Company entered into a termination agreement (the “Lease Termination Agreement”) related to the lease of its prior facility in South San Francisco, California. The Lease Termination Agreement, approved by order of the Bankruptcy Court issued March 15, 2016, waived all damages related to early termination of the lease, relieved the Company of March rental expenses and set an effective termination date of March 31, 2016. In accordance with the termination of the lease, the Company wrote off remaining deferred rent liabilities of approximately $312,000 and disposed of certain leasehold improvements and furniture and fixtures with a net book value of approximately $85,000. The resulting gain of $227,000 is included in Reorganization items, net in the accompanying Consolidated Statement of Operations and Comprehensive Loss for the year ended December 31, 2016. Concurrent with the termination of its prior lease, the Company entered into a lease agreement for a new office facility in Brisbane, California. The new lease commenced in April 2016 and expires in March 2017. On February 16, 2017, the Company amended the lease to extend the term of the lease for an additional period of eighteen months such that the lease will expire on September 30, 2018. The reconciliation of certain proofs of claim filed against the Company in the Bankruptcy Case, including certain General Unsecured Claims, Convenience Class Claims and Other Subordinated Claims, is ongoing. As a result of its examination of the claims, the Company may ask the Bankruptcy Court to disallow, reduce, reclassify or otherwise adjudicate certain claims the Company believes are subject to objection or otherwise improper. Under the terms of the Plan, the Company had until December 27, 2016 to file additional objections to disputed claims, subject to the Company’s right to seek an extension of this deadline from the Bankruptcy Court. By Order, dated February 6, 2017, the Bankruptcy Court extended the claims objection deadline to June 26, 2017. The Company may compromise certain claims with or without specific prior approval of the Bankruptcy Court as set forth in the Plan and may identify additional liabilities that will need to be recorded or reclassified to liabilities subject to compromise. The resolution of such claims could result in material adjustments to the Company’s financial statements. As of December 31, 2016, approximately $850,000 in claims remain subject to review and reconciliation by the Company. The Company may file objections to these claims after it completes the reconciliation process. As of December 31, 2016, the Company has recorded $130,000 and $124,000 related to these claims in Accounts payable and Notes payable to vendors, respectively, which represents management’s best estimate of claims to be allowed by the Bankruptcy Court. Although the Bankruptcy Case remains open, other than with respect to certain matters relating to the implementation of the Plan, the administration of certain claims, or over which the Bankruptcy Court may have otherwise retained jurisdiction, the Company is no longer operating under the direct supervision of the Bankruptcy Court. The Company anticipates that the Bankruptcy Case will be closed following the completion of the claims reconciliation process. Bankruptcy Related Financing Arrangements On April 1, 2016, the Company entered into the Credit Agreement with Black Horse Capital Master Fund Ltd., as administrative agent and lender (“BHCMF” or “Agent”), Black Horse Capital LP, as a lender (“BHC”), Cheval Holdings, Ltd., as a lender (“Cheval”) and Nomis Bay LTD, as a lender (“Nomis” and, together with BHCMF, BHC and Cheval, the “Lenders”). The Credit Agreement provided for a debtor-in-possession credit facility in the original principal amount of $3,000,000 (the “Term Loan”). The Credit Agreement provided that the Term Loan will be made by the Lenders at an original discount equal to $191,000 (the “Upfront Fee”) and required the payment by the Company to the Lenders of a commitment fee equal to $150,000 (the “Commitment Fee”). In accordance with the terms of the Credit Agreement, the Company used the proceeds of the Term Loan for working capital, bankruptcy-related costs, costs related to the Company’s plan of reorganization, the payment of certain fees and expenses owed to the Agent and the Lenders in connection with the Credit Agreement and other costs incurred in the ordinary course of business. Pursuant to the terms of the Credit Agreement, the Term Loan bore interest at a rate per annum equal to 12.00%. In accordance with the bidding procedures order entered by the Bankruptcy Court, the Term Loan and the SPA were together subject to competing, higher and better offers. In connection with the Company’s obligations under the Credit Agreement, the Company executed in favor of the Agent an Intellectual Property Security Agreement, dated as of April 1, 2016 (the “IP Security Agreement”). Under the terms of the IP Security Agreement, the Company pledged all of its intellectual property to the Agent for the ratable benefit of the Lenders, as collateral for its obligations under the Credit Agreement. The Credit Agreement provided that the outstanding principal balance of the Term Loan, plus accrued and unpaid interest, plus the Upfront Fee, plus the Commitment Fee and all other non-contingent obligations would mature on the earlier of an event of default under the Credit Agreement or the effective date of the Company’s plan of reorganization. The Maturity Date was deemed to occur simultaneously with the Effective Date and, accordingly, on June 30, 2016, 2,350,480 shares of common stock were issued to the Lenders in repayment of the Company’s debt obligations under the Credit Agreement, including 201,436 shares to BHC, 470,096 shares to BHCMF, 503,708 shares to Cheval, 940,192 shares to Nomis and 235,048 shares to Cortleigh Limited (“Cortleigh”). Pursuant to the terms of the Credit Agreement, the Company also paid $406,000 to BHC in payment of its fees and expenses and $285,000 to Nomis in payment of its fees and expenses. The Company records discounts to convertible notes for the intrinsic value of conversion options embedded in debt instruments based upon the fair value of the underlying common stock at the commitment date of the note transaction exceeding the effective conversion price embedded in the note. The Company evaluated the Credit Agreement for beneficial conversion features and calculated a value of approximately $484,000, all of which was expensed as of the Effective Date. In conjunction with the Credit Agreement, during the year ended December 31, 2016, the Company incurred the following expenses which have been charged to Reorganization items, net in the accompanying Consolidated Statements of Operations and Comprehensive Loss: Year ended (in thousands) December 31, 2016 Upfront fee $ 191 Commitment fee 150 Beneficial conversion feature 484 Legal fees 802 Total Credit Agreement expense $ 1,627 On April 1, 2016, the Company also entered into the SPA with the Lenders. The SPA provides for the sale to the Lenders on the closing date of an aggregate of 5,885,000 shares of common stock, subject to adjustment as provided in the SPA, in respect of exit financing in the amount of $11,000,000 (the “Exit Financing”) plus an exit financing commitment fee of $770,000 payable by the Company to the Lenders, plus payment to the Lenders of their fees and expenses incurred in connection with the Exit Financing and the SPA. Nomis subsequently assigned twenty percent (20%) of its interest in the shares of common stock to be purchased by Nomis under the SPA and the Credit Agreement to Cortleigh (collectively with the Lenders, the “Purchasers”). The consummation of the transactions contemplated by the SPA were contingent on, among other things, the funding of the Term Loan, the approval of the Bankruptcy Court of the Company’s plan of reorganization, and the simultaneous closing of the Company’s transaction with Savant. In addition, the closing of the transactions under the SPA were contingent upon the board of directors of the Company, upon the effectiveness of the confirmed plan of reorganization, consisting of (i) one director to be designated by Nomis; (ii) one director to be jointly designated by BHC, BHCF, and Cheval; (iii) the Chief Executive Officer of the Company to be designated jointly and unanimously by the Lenders; and (iv) two independent directors to be designated jointly and unanimously by the Lenders. The issuance of the shares contemplated by the SPA was consummated on the Effective Date, and the Company issued to the Purchasers an aggregate of 7,147,035 shares of common stock for an aggregate purchase price of $11,000,000, including 612,501 shares to BHC, 1,429,407 shares to BHCMF, 1,531,610 shares to Cheval, 2,858,814 shares to Nomis and 714,703 shares to Cortleigh. Pursuant to the terms of the SPA, the Company paid $427,000 to BHC in payment of its fees and expenses and $304,000 to Nomis in payment of its fees and expenses. Under the terms of the SPA, the Company was required to use commercially reasonable efforts to cause a registration statement registering the resale by the Purchasers of the shares issuable under the SPA to be declared effective by the SEC no later than December 27, 2016. The Company was obligated to keep the registration statement effective until all of the shares issued pursuant to the SPA are eligible for resale by the Purchasers without volume restrictions under an exemption from registration under the Securities Act. If the registration statement has not been declared effective by December 27, 2016 and any of the shares issued pursuant to the SPA are not eligible to be sold under Rule 144, then during each subsequent thirty day period (or portion thereof) until the registration statement is declared effective, the Company agrees to issue additional shares of common stock to the Purchasers in an amount equivalent to 10.0% of the shares originally purchased under the SPA that are then held by the Purchasers. On October 28, 2016, the SPA was amended to require the Company to file a registration statement by January 10, 2017 with effectiveness to be no later than March 31, 2017. On December 19, 2016, the SPA was amended again to require the Company to file a registration statement by March 17, 2017 with effectiveness to be no later than June 20, 2017. Governance Arrangements On the Effective Date, the Company and Martin Shkreli, the Company’s former Chief Executive Officer, former Chairman and former controlling stockholder, entered into a Corporate Governance Agreement (the “Governance Agreement”), which provides for certain terms and conditions regarding the acquisition, disposition, holding and voting of securities of the Company by Mr. Shkreli. The Governance Agreement applies to all common stock owned by Mr. Shkreli or affiliates he controls. Under the terms of the Governance Agreement, for 180 days following the Effective Date, Mr. Shkreli could not sell his shares of common stock at a price per share that was less than the greater of (x) $2.50 and (y) a 10% discount to the prior two week volume-weighted average price (the “Market Discount Price”). In addition, for 180 days following the 61st day after the Effective Date, the Company had a right to purchase any or all of Mr. Shkreli’s shares at a purchase price per share equal to the Market Discount Price. For a limited time, the Company also had a right of first refusal to purchase shares that Mr. Shkreli proposed to sell. Mr. Shkreli was also prohibited from transferring any shares to his affiliates or associates unless such transferee agreed to be subject to the terms of the Governance Agreement. Transfers of shares by Mr. Shkreli not made in compliance with the Governance Agreement would be null and void. Under the terms of the Governance Agreement, Mr. Shkreli will not have any right to nominate directors to the Board of Directors of the Company and agreed in connection with any stockholder vote to vote his shares in proportion to the votes of the Company’s public stockholders. The Governance Agreement also prohibits Mr. Shkreli or his affiliates for a period of 24 months after the date of the Governance Agreement, from, among other things: · purchasing any stock or assets of the Company; · participating in any proposal for any merger, tender offer or other business combination, or similar extraordinary transaction involving the Company or any of its subsidiaries; · seeking to control or influence the management, the Company’s Board or the policies of the Company; or · submitting any proposal to be considered by the stockholders of the Company. In addition, any material transaction between Mr. Shkreli or his associates and the Company, or relating to the Governance Agreement, cannot be taken without the prior approval of the Company’s Board. The Governance Agreement provides for a mutual release between the Company and Mr. Shkreli of all claims and liabilities existing as of the date of execution. On August 25 and August 26, 2016, Mr. Shkreli sold all of his shares of the Company to third party investors in private transactions. Board Changes On the Effective Date, in accordance with the Plan, Cameron Durrant, current Chief Executive Officer of the Company, as joint designee of BHCMF, BHC and Cheval (the "Black Horse Entities") and Nomis, continued as a director, Ronald Barliant, current member of the Board, continued as a director as the designee of the Black Horse Entities, Dale Chappell became a director as a designee of Nomis, and Timothy Morris and Ezra Friedberg became directors as joint designees of the Black Horse Entities and Nomis. Financial Reporting in Reorganization The Company applied Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 852, Reorganizations As of December 31, 2015, the Company had approximately $5.4 million recorded as Liabilities subject to compromise. In conjunction with the Company’s exit from bankruptcy, the Company reclassified remaining Liabilities subject to compromise totaling approximately $2.8 million, $0.8 million and $1.2 million to Accounts payable, Accrued expenses and Notes payable to vendors, respectively. For year ended December 31, 2016, the Company paid approximately $3.4 million related to Liabilities subject to compromise, issued $1.2 million in promissory notes to vendors and wrote off approximately $0.3 million in deferred rent liabilities related to its lease termination and reversed approximately $0.1 million in accrued expenses related to a claim that has been denied by the court, which as discussed above, were previously included in Liabilities subject to compromise. As of December 31, 2016, approximately $0.4 million and $1.2 million remain in Accounts payable and Notes payable to vendors, respectively. Remaining amounts will be paid based on terms of the Plan. For the year ended December 31, 2016, Reorganization items, net consisted of the following charges: Year ended (in thousands) December 31, 2016 Legal fees $ 4,870 Professional fees 1,218 Debtor-in-possession financing costs 1,143 Beneficial conversion on debtor-in-possession financing 484 Fair value of shares issued to officer and directors for service in bankruptcy 700 Gain on lease termination (227 ) Total reorganization items, net $ 8,188 Cash payments for reorganization items totaled $5.0 million for the year ended December 31, 2016. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 3. Summary of Significant Accounting Policies Basis of Presentation and Use of Estimates The accompanying Consolidated Financial Statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and include all adjustments necessary for the presentation of the Company’s consolidated financial position, results of operations and cash flows for the periods presented. The Consolidated Financial Statements include the accounts of the Company and its wholly owned subsidiaries. These financial statements have been prepared on a basis that assumes that the Company will continue as a going concern, which contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of business. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts and disclosures reported in the Consolidated Financial Statements and accompanying notes. Actual results could differ materially from those estimates. The Company believes judgment is involved in determining the valuation of the financing derivative, the fair value‑based measurement of stock‑based compensation, accruals, liabilities subject to compromise and warrant valuations. The Company evaluates its estimates and assumptions as facts and circumstances dictate. As future events and their effects cannot be determined with precision, actual results could differ from these estimates and assumptions, and those differences could be material to the Consolidated Financial Statements. Concentration of Credit Risk Cash, cash equivalents, and marketable securities consist of financial instruments that potentially subject the Company to a concentration of credit risk in the event of a default by the related financial institution holding the securities, to the extent of the value recorded in the balance sheet. The Company invests cash that is not required for immediate operating needs primarily in highly liquid instruments with lower credit risk. The Company has established guidelines relating to the quality, diversification, and maturities of securities to enable the Company to manage its credit risk. Fair Value of Financial Instruments Cash, accounts payable and accrued liabilities are carried at cost, which approximates fair value given their short‑term nature. Marketable securities and cash equivalents are carried at fair value. The fair value of financial instruments reflects the amounts that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The fair value hierarchy is based on three levels of inputs that may be used to measure fair value, of which the first two are considered observable, and the third is considered unobservable, as follows: Level 1—Quoted prices in active markets for identical assets or liabilities. Level 2—Inputs other than those included in Level 1 that are directly or indirectly observable, such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The Company measures the fair value of financial assets and liabilities using the highest level of inputs that are reasonably available as of the measurement date. The following tables summarize the fair value of financial assets (marketable securities) that are measured at fair value, and the classification by level of input within the fair value hierarchy: Fair Value Measurements as of December 31, 2016 (in thousands) Level 1 Level 2 Level 3 Total Investments: Money market funds $ 101 $ — $ — $ 101 Total assets measured at fair value $ 101 $ — — $ 101 Fair Value Measurements as of December 31, 2015 (in thousands) Level 1 Level 2 Level 3 Total Investments: Money market funds $ 196 $ — $ — $ 196 Total assets measured at fair value $ 196 $ — — $ 196 The estimated fair value of the December Term Loan payable and the Notes payable to vendors as of December 31, 2016, based upon current market rates for similar borrowings, as measured using Level 3 inputs, approximate the carrying amounts as presented in the Consolidated Balance Sheet. There were no notes payable as of December 31, 2015. Cash, Cash Equivalents, and Marketable Securities The Company considers all highly liquid investments with an original maturity of 90 days or less at the time of purchase to be cash equivalents. Cash and cash equivalents consist of deposits with commercial banks in checking, interest‑bearing and demand money market accounts. The Company invests in marketable securities consisting primarily of certificates of deposit, money market funds, corporate securities, commercial paper, U.S. government‑backed securities and U.S. treasury notes. These securities are classified as available‑for‑sale and carried at estimated fair value, with unrealized gains and losses reported as part of accumulated other comprehensive income (loss), a separate component of stockholders’ equity. Realized gains and losses from the sale of marketable securities are calculated using the specific‑identification method. Realized gains and losses and declines in value judged to be other‑than‑temporary are included in Other expense, net in the Consolidated Statements of Operations and Comprehensive Loss. To date, the Company has not recorded any impairment charges on its marketable securities related to other‑than‑temporary declines in market value. In determining whether a decline in market value is other‑than‑temporary, various factors are considered, including whether the decline is attributed to a change in credit risk and whether it is more likely‑than‑not that the Company will hold the security for a period of time sufficient to allow for an anticipated recovery in market value. The Company recognized a net gain from the sale of marketable securities of $8,000 for the year ended December 31, 2015. The Company had no realized gains or losses from the sale of marketable securities for the year ended December 31, 2016. Restricted Cash Restricted cash at December 31, 2016 consisted of $101,000 related to a standby letters of credit in the amount of $50,000 issued in connection with certain insurance policy coverage maintained by the Company and restricted cash related to a credit card facility in the amount of $51,000. Restricted cash at December 31, 2015 consisted of $193,000 related to standby letters of credit issued in connection with an operating lease for the Company’s corporate headquarters and certain insurance policy coverage maintained by the Company. Property and Equipment, Net Property and equipment is stated at cost, less accumulated depreciation and amortization, and depreciated over the estimated useful lives of the respective assets of three years using the straight‑line method. Leasehold improvements are amortized on a straight‑line basis over the shorter of the useful lives or the non-cancelable term of the related lease. Maintenance and repair costs are charged as expense in the Statements of Operations and Comprehensive Loss as incurred. Long‑Lived Assets The Company evaluates the carrying value of its long‑lived assets, including intangible assets, whenever events or changes in circumstances indicate that the carrying value of the asset may be impaired. An impairment loss would be recognized when estimated future cash flows expected to result from the use of the asset, including disposition, are less than the carrying value of the asset. To date, the Company has not recorded any impairment charges on its long‑lived assets. Debt Issue Costs As of January 1, 2016, the Company adopted Financial Accounting Standards Board (“FASB”) Accounting Standards Update (“ASU”) No. 2015-03 and No. 2015-15, which require that debt issuance costs related to a recognized debt liability be presented on the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. As a result of our adoption of the guidance, as of December 31, 2016, $460,000 of deferred financing costs were reclassified to reduce the Term loan payable in the Consolidated Balance Sheet. The guidance did not have a material impact on the consolidated financial statements. Research and Development Expenses Development costs incurred in the research and development of new product candidates are expensed as incurred, including expenses that may or may not be reimbursed under research and development collaboration arrangements. Research and development costs include, but are not limited to, salaries, benefits, stock‑based compensation, laboratory supplies, allocated overhead, fees for professional service providers and costs associated with product development efforts, including preclinical studies and clinical trials. Research and development expenses under collaborative agreements approximate or exceed the revenue recognized under such agreements. The Company estimates preclinical study and clinical trial expenses based on the services performed, pursuant to contracts with research institutions and clinical research organizations that conduct and manage preclinical studies and clinical trials on its behalf. In accruing service fees, the Company estimates the time period over which services will be performed and the level of effort to be expended in each period. If the actual timing of the performance of services or the level of effort varies from the estimate, the Company will adjust the accrual accordingly. Payments made to third parties under these arrangements in advance of the receipt of the related services are recorded as prepaid expenses until the services are rendered. The Company records upfront and milestone payments made to third parties under licensing arrangements as an expense. Upfront payments are recorded when incurred and milestone payments are recorded when the specific milestone has been achieved. Research and Development Services Internal and external research and development costs incurred in connection with collaboration agreements are recognized as revenue in the same period as the costs are incurred and are presented on a gross basis when the Company acts as a principal, has the discretion to choose suppliers, bears credit risk, and performs at least part of the services. Revenue Recognition The Company recognizes revenue when: (i) persuasive evidence of an arrangement exists, (ii) transfer of technology has been completed, delivery has occurred or services have been rendered, (iii) the fee is fixed or determinable, and (iv) collectability is reasonably assured. Payments received in advance of work performed are recorded as deferred revenue and recognized when earned. All revenue recognized to date under the Company’s collaborative agreements has been nonrefundable. Multiple Element Arrangements The Company evaluates revenue from agreements that have multiple elements to determine whether the components of the arrangement represent separate units of accounting. Management considers whether components of an arrangement represent separate units of accounting based upon whether certain criteria are met, including whether the delivered element has stand‑alone value to the customer. To date, all of the Company’s research and development collaboration and license agreements have been assessed to have one unit of accounting. Up‑front and license fees received for a combined unit of accounting are deferred and recognized ratably over the projected performance period. Nonrefundable fees where the Company has no continuing performance obligations are recognized as revenue when collection is reasonably assured and all other revenue recognition criteria have been met. Stock-Based Compensation Expense The Company measures employee and director stock-based compensation expense for stock awards at the grant date, based on the fair value-based measurement of the award, and the expense is recorded over the related service period, generally the vesting period, net of estimated forfeitures. The Company calculates the fair value-based measurement of stock options using the Black-Scholes valuation model and the single-option method and recognizes expense using the straight-line attribution approach. The Company accounts for equity instruments issued to non-employees in accordance with the provisions of ASC 505, Equity Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Company’s Own Stock. Income Taxes The Company accounts for income taxes under an asset-and-liability approach. Deferred income taxes reflect the impact of temporary differences between assets and liabilities recognized for tax and financial reporting purposes measured by applying enacted tax rates and laws that will be in effect when the differences are expected to reverse, net operating loss carryforwards and tax credits. Valuation allowances are provided when necessary to reduce net deferred tax assets to an amount that is more likely than not to be realized. The Company’s policy is to include interest and penalties related to unrecognized tax benefits within the Company’s provision for income taxes. Comprehensive Loss Comprehensive loss represents net loss adjusted for the change during the periods presented in unrealized gains and losses on available-for-sale securities less reclassification adjustments for realized gains or losses included in net loss. The unrealized gains or losses are reported on the Consolidated Statements of Operations and Comprehensive Loss. Net Loss Per Common Share Basic net loss per common share is calculated by dividing the net loss attributable to common stockholders by the weighted-average number of common shares outstanding during the period, without consideration for potentially dilutive securities. Diluted net loss per share is computed by dividing the net loss attributable to common stockholders by the weighted-average number of common shares and potentially dilutive securities outstanding for the period determined using the treasury-stock and if-converted methods. For purposes of the diluted net loss per share calculation, stock options, restricted stock units and common stock warrants are considered to be potentially dilutive securities but are excluded from the calculation of diluted net loss per share because their effect would be anti-dilutive and therefore, basic and diluted net loss per share were the same for all periods presented. The Company’s potential dilutive securities, which include stock options, restricted stock units and warrants have been excluded from the computation of diluted net loss per share as the effect would be to reduce the net loss per common share and be antidilutive. Therefore, the denominator used to calculate both basic and diluted net loss per common share is the same in all periods presented. The following shares subject to outstanding potentially dilutive securities have been excluded from the computations of diluted net loss per common share as the effect of including such securities would be antidilutive: Year Ended December 31, 2016 2015 Options to purchase common stock 1,835,835 465,401 Warrants to purchase common stock 356,193 131,193 Restricted stock units - 3,750 2,192,028 600,344 Deferred Rent The Company records its costs under facility operating lease agreements as rent expense. Rent expense is recognized on a straight-line basis over the non-cancelable term of the operating lease. The difference between the actual amounts paid and amounts recorded as rent expense is recorded to deferred rent. Segment Reporting The Company determines its segment reporting based upon the way the business is organized for making operating decisions and assessing performance. The Company operates in only one segment, which is related to the development of pharmaceutical products. Recent Accounting Pronouncements The Company qualifies as an “emerging growth company” (“EGC”) pursuant to the provisions of the JOBS Act and has elected to take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act which permits EGCs to defer compliance with new or revised accounting standards (the “EGC extension”) until non-issuers are required to comply with such standards. Accordingly, so long as the Company continues to qualify as an EGC, the Company will not have to adopt or comply with new accounting standards until non-issuers are required to comply with such standards. In May 2014, the FASB issued ASU 2014-09, "Revenue from Contracts with Customers (Topic 606)." ASU 2014-09 completes the joint effort by the FASB and International Accounting Standards Board to improve financial reporting by creating common revenue recognition guidance for U.S. GAAP and International Financial Reporting Standards. ASU 2014-09 applies to all companies that enter into contracts with customers to transfer goods or services. ASU 2014-09 is effective for public entities for interim and annual reporting periods beginning after December 15, 2017. Early application is not permitted and entities have the choice to apply ASU 2014-09 either retrospectively to each reporting period presented or by recognizing the cumulative effect of applying ASU 2014-09 at the date of initial application and not adjusting comparative information. The Company is currently evaluating the requirements of ASU 2014-09 and has not yet determined its impact on the Company's Consolidated Financial Statements. In August 2014, the FASB issued ASU 2014-15, “Presentation of Financial Statements - Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern”, which defines management’s responsibility to evaluate, at each annual and interim reporting period, whether there are conditions or events that raise substantial doubt about an entity’s ability to continue as a going concern within one year after the date the financial statements are issued and to provide related footnote disclosures in certain circumstances. In connection with each annual and interim period, management must assess if there is substantial doubt about the company’s ability to continue as a going concern within one year after the issuance date. Disclosures are required if conditions give rise to substantial doubt. This standard is effective for all companies in the first annual period ending after December 15, 2016, and interim periods thereafter, with early adoption permitted. The Company adopted this standard at December 31, 2016 and the adoption had no impact on its consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842)”, which requires lessees to recognize on the balance sheet a right-of use asset, representing its right to use the underlying asset for the lease term, and a lease liability for all leases with terms greater than 12 months. The guidance also requires qualitative and quantitative disclosures designed to assess the amount, timing, and uncertainty of cash flows arising from leases. The standard requires the use of a modified retrospective transition approach, which includes a number of optional practical expedients that entities may elect to apply. Early application is permitted. The Company is currently evaluating the requirements of ASU 2016-02 and has not yet determined its impact on the Company’s Consolidated Financial Statements. In March 2016, the FASB issued Accounting Standards Update 2016-09, Stock Compensation – Improvements to Employee Share-Based Payment Accounting |
Investments
Investments | 12 Months Ended |
Dec. 31, 2016 | |
Investments, Debt and Equity Securities [Abstract] | |
Investments | 4. Investments At December 31, 2016, the amortized cost and fair value of investments, with gross unrealized gains and losses, were as follows: Amortized Gross Unrealized Gross Unrealized (in thousands) Cost Gains Losses Fair Value Money market funds $ 101 $ — $ — $ 101 Total investments $ 101 $ — $ — $ 101 Reported as: Cash and cash equivalents $ — Restricted cash 101 Total investments $ 101 At December 31, 2015, the amortized cost and fair value of investments, with gross unrealized gains and losses, were as follows: Gross Gross Amortized Unrealized Unrealized (in thousands) Cost Gains Losses Fair Value Money market funds $ 196 $ — $ — $ 196 Total investments $ 196 $ — $ — $ 196 Reported as: Cash and cash equivalents $ 3 Restricted cash, long-term 193 Total investments $ 196 |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | 5. Property and Equipment Property and equipment consists of the following: December 31, (In thousands) 2016 2015 Computer equipment and software $ 216 $ 330 Leasehold improvements, furniture and fixtures — 189 216 519 Accumulated depreciation and amortization (148 ) (231 ) Property and equipment, net $ 68 $ 288 Depreciation and amortization expense for the years ended December 31, 2016 and December 31, 2015 was $102,000 and $197,000, respectively. |
Savant Arrangements
Savant Arrangements | 12 Months Ended |
Dec. 31, 2016 | |
Savant Arrangements | |
Savant Arrangements | 6. Savant Arrangements On February 29, 2016, the Company entered into a binding letter of intent (the “LOI”) with Savant Neglected Diseases, LLC (“Savant”). The LOI provided that the Company would acquire certain worldwide rights relating to benznidazole (the “Compound”) from Savant Compound The LOI provided that in consideration for the assets to be acquired, the Company would provide consideration to Savant, including: · $3,000,000 (the “Initial Payment”) payable as soon as practicable but in no event later than the Company emerging from its Chapter 11 bankruptcy pursuant to a plan of reorganization (the “Bankruptcy Exit”); · a five-year warrant from the date of the Bankruptcy Exit to purchase up to 200,000 shares of common stock at a per share price of $2.25, exercisable for 25% of the shares immediately and exercisable for the remaining shares upon reaching certain milestones related to regulatory approval of the Compound · certain additional payments to be further specified in the definitive agreements. On the Effective Date, as authorized by the Plan and the Confirmation Order, the Company and Savant entered into an Agreement for the Manufacture, Development and Commercialization of Benznidazole for Human Use (the “MDC Agreement”), pursuant to which the Company acquired certain worldwide rights relating to the Compound. The MDC Agreement consummates the transactions contemplated by the LOI. Under the terms of the MDC Agreement, the Company acquired certain regulatory and non-intellectual property assets relating to the Compound and any product containing the Compound and an exclusive license of certain intellectual property assets related to the Compound. Savant will retain the right to use the licensed intellectual property for veterinary uses. The MDC Agreement provides that the Company and Savant will jointly conduct research and development activities with respect to the Compound Compound Compound As required by the MDC Agreement, on the Effective Date, the Company made payments to Savant totaling $2,687,500, consisting of the remaining portion of the Initial Payment less the deposit in the amount of $2,500,000, an initial monthly Joint Development Program Cost payment of $87,500, and reimbursement of Savant’s legal fees capped at $100,000. The MDC Agreement provides for milestone payments, including payments related to U.S. and foreign regulatory submissions of up to $21 million and certain other contingent payments. Additionally, the Company will pay Savant royalties on any net sales of the Compound Compound Compound In addition, on the Effective Date the Company and Savant also entered into a Security Agreement (the “Security Agreement”), pursuant to which the Company granted Savant a continuing senior security interest in the assets and rights acquired by the Company pursuant to the MDC Agreement and certain future assets developed from those acquired assets. On the Effective Date, the Company issued to Savant a five year warrant (the “Warrant”) to purchase 200,000 shares of the Company’s Common Stock, at an exercise price of $2.25 per share, subject to adjustment. The Warrant is exercisable for 25% of the shares immediately and exercisable for the remaining shares upon reaching certain regulatory related milestones. In addition, pursuant to the MDC Agreement, the Company has granted Savant certain “piggyback” registration rights for the shares issuable under the Warrant. The Company determined the fair value of the Warrant to be approximately $670,000 and recorded expense of approximately $244,000 during the three months ended June 30, 2016, which is included in Research and development expenses in the accompanying Condensed Consolidated Statement of Operations and Comprehensive Loss. The Company reevaluated the performance conditions and expected vesting of the Warrant as of September 30 and December 31, 2016 and recorded total expense of approximately $361,000 during the year ended December 31, 2016, which is included in Research and development expenses in the accompanying Consolidated Statement of Operations and Comprehensive Loss. The Company will continue to reevaluate the performance conditions and expected vesting of the Warrant on a quarterly basis until all performance conditions have been met. Before a compound receives regulatory approval, the Company records upfront and milestone payments made to third parties under licensing arrangements as expense. Upfront payments are recorded when incurred and milestone payments are recorded when the specific milestone has been achieved. The Company has determined that the acquisition of the Compound should be treated as a purchase of in-process research and development. Accordingly, during the nine months ended September 30, 2016, the Company recorded $3,250,000, which includes an additional $250,000 payment made in 2015 to Savant, as Research and development expense in the accompanying Condensed Consolidated Statement of Operations and Comprehensive Loss. In addition, during the year ended December 31, 2016, the Company recorded $262,500 in connection with the Joint Development Program and recorded $100,000 in legal fee reimbursement as Research and development expense in the accompanying Condensed Consolidated Statement of Operations and Comprehensive Loss. |
Notes Payable
Notes Payable | 12 Months Ended |
Dec. 31, 2016 | |
Debt Disclosure [Abstract] | |
Notes Payable | 7. Notes Payable Loan and Security Agreement In September 2012, the Company entered into the Loan and Security Agreement with MidCap Financial, which provided for the borrowing of up to $15 million. The Loan and Security Agreement originally provided for the loan to be issued in three tranches: the first tranche of $5 million was issued in September 2012; the second tranche of $5 million was issued in December 2012; and, prior to the First Amendment described below, the final tranche of $5 million was available to be drawn at the option of the Company by no later than June 2013. The loan had a monthly variable interest rate, reset each month, if applicable, as determined by adding to 600 basis points the greater of: (a) one month LIBOR or (b) 3%. Interest on amounts outstanding were payable monthly in arrears. An interest only period to December 31, 2013 was followed by straight‑line principal payments over thirty‑six months until December 31, 2016. Under the terms of the Loan and Security Agreement, at the time of final payment, the Company was required to pay an exit fee of 3% of the drawn amount. If the Company chose to prepay the loan, or if the loan was determined to be in default and early repayment was required, the Company would also have had to pay a fee ranging from 1% to 2% of the outstanding loan balance at the date of default. Pursuant to the Loan and Security Agreement, the Company also provided a first priority security interest in all existing and after‑acquired assets, excluding intellectual property. In June 2013, the Company entered into an amendment to the Loan and Security Agreement (“the First Amendment”) to extend the draw down date for the final tranche of $5.0 million from June 2013 to May 2014, and to require the Company to draw that amount, which it did in May 2014. In connection with the First Amendment, the Company issued a warrant to purchase up to 6,193 shares of the Company’s common stock with an exercise price of $96.88 per share. The warrant expires on the tenth anniversary of its issuance date and had an initial fair value of $130,000, which represents financing fees, was included in Other assets and was being amortized as non‑cash Interest expense over the remaining term of the Loan and Security Agreement using the effective interest method. The Company estimated the fair value of this warrant using the Black‑Scholes option‑pricing model, based on the inputs for the estimated fair value of the underlying common stock at the valuation measurement date, the contractual term of the warrant, risk‑free interest rates, expected dividend rates and expected volatility of the price of the underlying common stock. The Company recorded interest expense related to the borrowings of $842,000 for the year ended December 31, 2015. Included in Interest expense for this period was interest on principal, amortization of the debt issuance costs, accretion of debt discount, and the accretion of the final exit fee. For the year ended December 31, 2015, the effective interest rate on the amounts borrowed under the Loan and Security Agreement, including the accretion of the debt discount and the accretion of the final payment, was 10%. In August 2015, the Company entered into Amendment No. 2 to the Loan and Security Agreement, whereby the Company agreed to maintain, in a separate account with a financial institution (held in the Company’s name), an amount equal to the aggregate of the remaining future principal, interest and exit fee due under the Loan and Security Agreement, equating to $8.3 million as of the date of Amendment No. 2. Under the terms of the Loan and Security Agreement, as amended, MidCap Financial was permitted to draw payments from this account as they become due, and upon such draws, there would be a corresponding reduction in the amount owed to MidCap Financial by the Company. MidCap Financial had exclusive control to withdraw funds from that account at any time. The account was to be maintained either until the debt has been repaid in full, or until MidCap Financial determined that the Company satisfied certain capital requirements related to the Company’s future operating plans. In November 2015, the Company elected to exercise its prepayment right to repay the loan in full and paid MidCap Financial $6.6 million in full settlement of the remaining outstanding principal balance, accrued interest, the exit fee and a reduced prepayment fee of 1%. The prepayment resulted in a gain on extinguishment of debt of $61,000 in the fourth quarter of 2015, which is included in Other expense, net in the accompanying Consolidated Statements of Operations and Comprehensive Loss. Notes Payable to Vendors On June 30, 2016, the Company issued promissory notes in an aggregate principal amount of approximately $1,212,000 to certain claimants in accordance with the Plan. The notes are unsecured, bear interest at 10% per annum and are due and payable in full, including principal and accrued interest on June 30, 2019. As of December 31, 2016, the Company has accrued $61,000 in interest related to these promissory notes. December Term Loan On December 21, 2016, the Company entered into a Credit and Security Agreement (the “December Term Loan”) with Black Horse Capital Master Fund Ltd., as administrative agent and lender (“BHCMF” or “Agent”), Black Horse Capital LP, as a lender (“BHC”), Cheval Holdings, Ltd., as a lender (“Cheval”) and Nomis Bay LTD, as a lender (“Nomis” and, together with BHCMF, BHC and Cheval, the “Lenders”). The December Term Loan provides for a credit facility in the original principal amount of $3,315,000, provides an original discount equal to $265,000 (the “Upfront Fee”) and requires the payment by the Company to the Lenders of a commitment fee equal to $153,000 (the “Commitment Fee”). In accordance with the terms of the December Term Loan, the Company will use the proceeds for general working capital, the payment of certain fees and expenses owed to the Agent and the Lenders and other costs incurred in the ordinary course of business. The December Term Loan bears interest at 9.00% and is subject to certain customary representations, warranties and covenants. The outstanding principal balance of the December Term Loan, plus accrued interest and fees, are due on the earlier of acceleration after an event of default under the agreement, or October 31, 2017. However, to the extent the Company raises capital through any SEC-registered stock offering, 50% of such offering’s proceeds (net of costs) must be used to pay down the December Term Loan. Upon the occurrence of any event of default set forth in the agreement, the Agent has the option of terminating the agreement and declaring all of the Company’s obligations immediately payable. The occurrence of an event of default will cause the December Term Loan to bear interest at a rate per annum equal to 14.00%. The Company’s obligations under the December Term Loan are secured by a first priority interest in all of the Company’s real and personal property, subject only to certain carve outs and permitted liens, as set forth in the agreement. The Company recorded the original principal amount of the loan reduced by the Upfront Fee and costs incurred in putting the loan in place for a net principal amount of $2,993,000. As of December 31, 2016 the Company has accrued interest expense of $23,000 in the , consisting of $8,000 interest and loan cost accretion of $15,000 and has recorded such against the principal balance resulting in a loan balance of $3,016,000 in the accompanying Consolidated Balance Sheets. |
Warrants to Purchase Common Sto
Warrants to Purchase Common Stock | 12 Months Ended |
Dec. 31, 2016 | |
Warrants to Purchase Common Stock | |
Warrants to Purchase Common Stock | 8. Warrants to Purchase Common Stock On December 4, 2015, the Company issued a warrant to purchase up to an aggregate of 125,000 shares of common stock at an exercise price of $29.32 per share. The warrant expires on the fifth anniversary of its issuance and had an initial fair value of $2,507,000 which is included in General and administrative expenses in the accompanying Consolidated Statements of Operations and Comprehensive Loss for the year ended December 31, 2015. The warrant provides that if the Company declares a dividend, or makes any other distribution of its assets, to holders of common stock, then the warrant holder shall be entitled to participate in such dividend or distribution to the same extent that the holder would have participated had it held the number of shares of common stock acquirable upon complete exercise of the warrant. The warrant was issued in connection with a November 18, 2015 financing the Company elected not to pursue. On October 31, 2015, warrants issued in 2005 to purchase an aggregate of 4,874 shares of common stock at $41.04 per share expired. On June 30, 2016, in connection with the benznidazole acquisition the Company issued to Savant a five year warrant (the “Savant Warrant”) to purchase 200,000 shares of the Company’s Common Stock, at an exercise price of $2.25 per share, subject to adjustment. The Savant Warrant is exercisable for 25% of the shares immediately and exercisable for the remaining shares upon reaching certain regulatory related milestones. In addition, pursuant to the MDC Agreement, the Company has granted Savant certain “piggyback” registration rights for the shares issuable under the Warrant. The Company determined the initial fair value of the Savant Warrant to be approximately $670,000 as of June 30, 2016. The Company reevaluated the performance conditions and expected vesting of the Savant Warrant as of September 30 and December 31, 2016 and recorded total expense of approximately $361,000 during the year ended December 31, 2016, which is included in Research and development expenses in the accompanying Consolidated Statement of Operations and Comprehensive Loss. The Company will continue to reevaluate the performance conditions and expected vesting of the Savant Warrant on a quarterly basis until all performance conditions have been met. On December 1, 2016 the Company issued a warrant to purchase up to an aggregate of 25,000 shares of common stock at an exercise price of $4.00 per share. The warrant expires on the one year anniversary of its issuance and had a fair value of approximately $40,000 which is included in General and administrative expenses in the accompanying Consolidated Statements of Operations and Comprehensive Loss. The warrant provides that if the Company declares a dividend, or makes any other distribution of its assets, to holders of common stock, then the warrant holder shall be entitled to participate in such dividend or distribution to the same extent that the holder would have participated had it held the number of shares of common stock acquirable upon complete exercise of the warrant. The warrant was issued in connection with the engagement agreement related to certain investor relations activities. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 9. Commitments and Contingencies Operating Leases In December 2013, the Company entered into a lease agreement for a facility in South San Francisco, California. The lease commenced in July 2014 and was set to expire in 2019. Per the terms of the lease agreement, the Company had the option to terminate the lease after 36 months, subject to additional fees and expenses. Deferred rent applicable to this lease totaled $311,000 at December 31, 2015 which is included in Liabilities subject to compromise in the accompanying Consolidated Balance Sheet. In March 2016, the Company entered into a termination agreement (the “Lease Termination Agreement”) related to the lease of this facility. The Lease Termination Agreement, approved by order of the Bankruptcy Court issued March 15, 2016, waived all damages related to early termination of the lease, relieved the Company of March rental expenses and set an effective termination date of March 31, 2016. Concurrent with the termination of this lease, the Company entered into a lease agreement for a new facility in Brisbane, California. The new lease commenced in April 2016 and was to expire on March 31, 2017. On February 16, 2017, the Company amended the lease to extend the term of the lease for an additional period of eighteen months such that the lease will expire on September 30, 2018. As of December 31, 2016, future minimum lease payments due under the Company’s lease, including the lease amendment executed on February 16, 2017, are as follows: (in thousands) 2017 $ 240 2018 202 Total $ 442 Rent expense was $0.3 million and $0.7 million for the years ended December 31, 2016 and 2015, respectively. Indemnification The Company has certain agreements with service providers with which it does business that contain indemnification provisions pursuant to which the Company typically agrees to indemnify the party against certain types of third‑party claims. The Company accrues for known indemnification issues when a loss is probable and can be reasonably estimated. The Company would also accrue for estimated incurred but unidentified indemnification issues based on historical activity. As the Company has not incurred any indemnification losses to date, there were no accruals for or expenses related to indemnification issues for any period presented. |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2016 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity | 10. Stockholders’ Equity Bankruptcy Related Common Stock Issuances As more fully described in Note 2, on June 30, 2016, pursuant to the SPA and in repayment of its obligations under the Credit Agreement, the Company issued an aggregate of 9,497,515 shares of its common stock to the DIP Lenders. As more fully described in Note 2, on June 30, 2016, the Company issued 327,608 shares of common stock to the plaintiffs in litigation related to the Company’s 2015 private financing transaction in accordance with the settlement stipulation. The Company recorded an obligation to issue the related shares in stockholders’ equity and recorded the related expense of approximately $1.5 million in the attached Consolidated Statements of Operations and Comprehensive Loss for the year ended December 31, 2015. As more fully described in Note 2, on June 30, 2016, the Company issued 3,750 shares of common stock to a former director in satisfaction of claims against the Company. The Company recorded an obligation to issue the related shares in stockholders’ equity and recorded the related expense of approximately $16,000 in the attached Consolidated Statements of Operations and Comprehensive Loss for the year ended December 31, 2015. As more fully described in Note 2, on June 30, 2016, the Company issued 300,000 shares of common stock for issuance to the plaintiffs in a class action litigation related to the events surrounding the Company’s former Chairman and Chief Executive Officer. The Company recorded an obligation to issue the related shares in stockholders’ equity and recorded the related expense of approximately $1.3 million in the attached Consolidated Statements of Operations and Comprehensive Loss for the year ended December 31, 2015. Common Stock In June 2014, the Company amended and restated its certificate of incorporation to increase the authorized common stock to 85,000,000 shares. On July 13, 2015, the Company effected a one-for-eight reverse stock split of its outstanding common stock pursuant to an amendment to the Company’s certificate of incorporation. As a result of the reverse stock split, each eight shares of the Company’s common stock were combined into one share of common stock. The reverse stock split was effective with respect to stockholders of record at the close of business on July 13, 2015, and trading of the Company’s common stock on the Nasdaq Global Market began on a split-adjusted basis on July 14, 2015. Holders of common stock who would have otherwise received fractional shares of the Company’s common stock pursuant to the reverse stock split received cash in lieu of the fractional share. The reverse stock split reduced the total number of shares of the Company’s common stock outstanding from approximately 33.0 million shares to approximately 4.1 million shares. In addition, the number of shares of common stock subject to outstanding options, restricted stock units and warrants issued by the Company and the number of shares reserved for future issuance under the Company’s stock plans were reduced by a factor of eight to proportionately reflect the reverse stock split, and per share exercise prices were increased by a factor of eight. The reverse stock split was accounted for retroactively and is reflected in the Company’s common stock, warrant, stock option and restricted stock activity as of and for the years ended December 31, 2016 and 2015. Unless stated otherwise, all share data in the financial statements and accompanying notes have been adjusted, as appropriate, to reflect the reverse stock split. On December 3, 2015, the Company entered into a Securities Purchase Agreement (the “Securities Purchase Agreement”) with certain investors (the “Purchasers”) relating to a private placement of up to an aggregate 511,596 shares of common stock at a purchase price of $29.32 per share, or up to $15 million (the “Private Placement”). On December 15, 2015 the Securities Purchase Agreement was amended resetting the share price for all Purchasers other than those Purchasers who were directors, officers, employees or consultants of the Company to $24.86. Upon closing of the Private Placement, the Company issued to the Purchasers 326,698 shares of common stock for an aggregate of $8.2 million. On November 7, 2016, the Company issued 25,000 shares of restricted common stock to an investor relations consultant. The fair value of the shares issued based on the closing price on November 7, 2016 was $77,500 and was recorded as stock based compensation in the attached Consolidated Statements of Operations and Comprehensive Loss for the year ended December 31, 2016. On November 15, 2016, the Company issued 40,000 shares of restricted common stock to a financial advisor in return for services. The fair value of the shares issued based on the closing price on November 15, 2016 was $120,000 and was recorded as stock based compensation in the attached Consolidated Statements of Operations and Comprehensive Loss for the year ended December 31, 2016. The Company had reserved the following shares of common stock for issuance as of December 31, 2016: Warrants to purchase common stock 356,193 Options: Outstanding under the 2012 Equity Incentive Plan 1,826,548 Outstanding under the 2001 Equity Incentive Plan 9,287 Available for future grants under the 2012 Equity Incentive Plan 1,980,201 Total common stock reserved for future issuance 4,172,229 2012 Equity Incentive Plan Under the Company’s 2012 Equity Incentive Plan, the Company may grant shares, stock units, stock appreciation rights, performance cash awards and/or options to employees, directors, consultants, and other service providers. For options, the per share exercise price may not be less than the fair market value of a Company common share on the date of grant. Awards generally vest and become exercisable over three to four years and expire 10 years from the date of grant. Options generally become exercisable as they vest following the date of grant. In general, to the extent that awards under the 2012 Plan are forfeited or lapse without the issuance of shares, those shares will again become available for awards. The 2012 Plan will continue in effect for 10 years from its adoption date, unless the Company’s board of directors decides to terminate the plan earlier. On September 13, 2016, the Board of Directors of the Company approved an amendment to the Company’s 2012 Equity Incentive Plan to increase the number of shares of the Company’s common stock available for issuance under the Plan by 3,000,000 shares and to increase the annual maximum aggregate number of shares subject to stock option awards that may be granted to any one person under the Plan from 125,000 to 1,100,000. As of December 31, 2016, there were 1,980,201 shares available for grant under the 2012 Equity Incentive Plan. 2001 Equity Incentive Plan Under the Company’s 2001 Stock Plan (the “2001 Plan”), the Company was able to grant shares and/or options to purchase up to 426,030 shares of common stock to employees, directors, consultants, and other service providers. In connection with the 2012 Plan taking effect, the 2001 Plan was terminated in August 2012. However, the awards under the 2001 Plan outstanding as of the termination of the 2001 Plan continued to be governed by their existing terms. As of December 31, 2015, there were no shares available for grant under the 2001 Plan. 2012 Employee Stock Purchase Plan The Employee Stock Purchase Plan (the “ESPP”) provided eligible employees with the opportunity to acquire an ownership interest in the Company through periodic payroll deductions, based on a six-month look-back period, at a price equal to the lesser of 85% of the fair market value of the ordinary shares at either the beginning of the offering period, or the fair market value on the purchase date. The ESPP was structured as a qualified employee stock purchase plan under Section 423 stock bonus plan under Section 401(a) of the Internal Revenue Code of 1986 and was not subject to the provisions of the Employee Retirement Income Security Act of 1974. There were 21,058 shares initially authorized for issuance under the plan, and the first offering period commenced on June 1, 2014 and ended on October 31, 2014. The second offering period commenced on November 1, 2014 and ended on April 30, 2015. Offerings subsequent to the second offering commence on May 1 and November 1 and end on April 30 and October 31 each year. On May 3, 2016, the ESPP was terminated. Stock Option Activity The following table summarizes stock option activity for the year ended December 31, 2016: Weighted- Weighted- Average Average Remaining Exercise Contractual Aggregate Number of Price Term Intrinsic Value Shares (Per Share)(1) (in years) (in thousands)(2) Balances at December 31, 2014 334,686 $ 34.00 Options granted 321,020 3.46 Options forfeited (176,764 ) 17.58 Options expired (13,541 ) 24.32 Options exercised — — Balances at December 31, 2015 465,401 $ 19.29 Options granted 1,778,022 3.38 Options forfeited (3,416 ) 5.86 Options expired (398,547 ) 18.38 Options exercised (5,625 ) 1.77 Balances at December 31, 2016 1,835,835 $ 4.15 9.50 $ 947,896 As of December 31, 2016: Options vested and expected to vest 1,829,593 $ 4.15 9.50 $ 944,673 Exercisable 287,041 $ 8.35 8.46 $ 133,792 (1) The weighted average price per share is determined using exercise price per share for stock options. (2) The aggregate intrinsic value is calculated as the difference between the exercise price of the option and the fair value of the Company’s common stock for in‑the‑money options at December 31, 2016. The stock options outstanding and exercisable by exercise price at December 31, 2016 are as follows: Stock Options Outstanding Stock Options Exercisable Weighted- Average Weighted- Weighted- Remaining Average Average Number Contractual Exercise Number of Exercise Range of Exercise Prices Shares In Years Per Share Shares Per Share $1.91 - $1.91 8,500 8.76 $ 1.91 2,479 $ 1.91 $2.11 - $3.30 51,800 9.74 3.26 50,562 3.29 $3.38 - $3.38 1,678,022 9.71 3.38 139,831 3.38 $3.40 - $4.72 55,712 9.63 3.52 52,430 3.45 $8.24 - $17.36 9,200 1.13 9.78 9,200 9.78 $42.88 - $48.00 32,601 1.08 45.52 32,539 45.52 1,835,835 9.50 $ 4.15 287,041 $ $8.35 The total fair value of options vested for the years ended December 31, 2016 and 2015 was $0.8 million and $2.9 million, respectively. Stock Option Modifications During the year ended December 31, 2015, the Company’s Board of Directors approved modifications to certain stock options in connection with the Company’s restructuring activities. The modifications included both the acceleration of the vesting of options in connection with terminations of certain employees, as well as the extension of the exercise period post termination from the standard 90 day period to one year. The Company accounted for the option modification under ASC Topic 718, Compensation – Stock Compensation In addition, the vesting on certain options was accelerated upon termination based upon terms of the employment agreements with certain individuals. Stock‑Based Compensation The Company’s stock‑based compensation expense for stock options is estimated at the grant date based on the award’s fair value as calculated by the Black‑Scholes option pricing model and is recognized as expense over the requisite service period. The Black‑Scholes option pricing model requires various highly judgmental assumptions including expected volatility and expected term. The expected volatility is based on the historical stock volatilities of several of the Company’s publicly listed peers over a period equal to the expected terms of the options as the Company does not have a sufficient trading history to use the volatility of its own common stock. To estimate the expected term, the Company has opted to use the simplified method, which is the use of the midpoint of the vesting term and the contractual term. If any of the assumptions used in the Black‑Scholes option pricing model changes significantly, stock‑based compensation expense may differ materially in the future from that recorded in the current period. In addition, the Company is required to estimate the expected forfeiture rate and only recognize expense for those shares expected to vest. The Company estimates the forfeiture rate based on historical experience and its expectations regarding future pre‑vesting termination behavior of employees. The Company reviews its estimate of the expected forfeiture rate annually, and stock‑based compensation expense is adjusted accordingly. The weighted‑average fair value‑based measurement of stock options granted under the Company’s stock plans in the years ended December 31, 2016 and 2015 was $2.41 and $2.15 per share, respectively. The fair value‑ based measurement of stock options granted under the Company’s stock plans was estimated at the date of grant using the Black‑Scholes model with the following assumptions: Year Ended December 31, 2016 2015 Expected term 5-6 years 5-6 years Expected volatility 85 - 90% 67 - 78% Risk-free interest rate 1.3 - 1.4% 1.5 - 1.8% Expected dividend yield 0% 0% Total stock‑based compensation expense recognized was as follows: Year Ended December 31, (In thousands) 2016 2015 General and administrative $ 547 $ 1,134 Research and development 297 837 $ 844 $ 1,971 At December 31, 2016, the Company had $3.1 million of total unrecognized compensation expense, net of estimated forfeitures, related to outstanding stock options that will be recognized over a weighted‑average period of 2.5 years. |
Restructuring Charges
Restructuring Charges | 12 Months Ended |
Dec. 31, 2016 | |
Restructuring and Related Activities [Abstract] | |
Restructuring Charges | 11. Restructuring Charges Restructuring charges incurred during the nine months ended September 30, 2015 primarily consist of severance and other post-termination benefit costs resulting from the cost reduction program implemented by the Company in January 2015. These activities primarily consisted of 20% reduction of the Company’s workforce. Restructuring charges incurred during the three months ended December 31, 2015 primarily relates to a board-approved restructuring plan announced in November 2015 to reduce costs and extend the cash runway in order to allow the Company to evaluate strategic alternatives for the products and the Company. As part of the restructuring plan, the Company elected to exercise its right to prepay the Loan and Security Agreement and paid MidCap Financial $6.6 million in full settlement of the remaining outstanding principal balance, accrued interest, the exit fee and a reduced prepayment fee of 1%. In addition, the Company undertook a reduction in force that eliminated the positions of 17 employees or more than 60% of the Company’s workforce. Per ASC 420-10-05-1, Exit or Disposal Cost Obligations, include, but are not limited to, involuntary termination benefits provided to employees under the terms of a one-time benefit arrangement that, in substance, is not an ongoing benefit arrangement or a deferred compensation contract, and certain contract termination costs. Restructuring costs are expensed during the period in which the Company determines it will incur those costs and all requirements of accrual are met. A summary of the activity is presented below: (in thousands) Contract termination costs - R&D Salaries and benefits - R&D Salaries and benefits - G&A Total Balance as of December 31, 2014 $ 1,185 $ - $ - $ 1,185 Accrued - 1,167 1,011 2,178 Adjustments (78 ) - - (78 ) Paid (1,107 ) (1,167 ) (1,000 ) (3,274 ) Balance as of December 31, 2015 $ - $ - $ 11 $ 11 Accrued - - - - Adjustments - - (11 ) (11 ) Paid - - - - Balance as of December 31, 2016 $ - $ - $ - $ - As disclosed in Note 10, in addition to the restructuring charges in the table above, the Company recorded stock based compensation expense of $959,000 related to the fair value of stock options of former employees which were modified such that they did not expire upon termination. The Company classified $542,000 and $417,000 as general and administrative expenses and research and development expenses, respectively. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 12. Income Taxes No provision for federal income taxes has been recorded for the years ended December 31, 2016 and 2015 due to net losses and the valuation allowance established. Deferred tax assets and liabilities reflect the net tax effects of net operating loss and tax credit carryovers and the temporary differences between the carrying amounts of assets and liabilities for financial reporting and the amounts used for income tax purposes. Significant components of the Company's deferred tax assets are as follows (in thousands): December 31, 2016 2015 Deferred tax assets: Net operating losses $ 57,903 $ 49,145 Research & other credits 2,121 1,978 Stock based compensation 2,164 1,047 In-Process R&D 1,246 — Accrued bankruptcy settlement — 1,328 Other 761 222 Total deferred tax assets 64,195 53,720 Valuation allowance (64,195 ) (53,720 ) Net deferred tax assets $ — $ — A reconciliation of the statutory tax rates and the effective tax rates for the years ended December 2016 and 2015 is as follows: Year Ended December 31, 2016 2015 Statutory rate 34.0 % 34.0 % Valuation allowance (34.8 ) (31.1 ) Nondeductible stock compensation (0.1 ) (2.9 ) Other 0.9 - Effective tax rate - % - % Realization of deferred tax assets is dependent upon future earnings, if any, the timing and amount of which are uncertain. Accordingly, the net deferred tax assets have been fully offset by a valuation allowance. The valuation allowance increased by $10.5 million during 2016 and increased by $12.3 million during 2015. At December 31, 2016, the Company had federal net operating loss carryforwards of approximately $146.8 million, which expire in the years 2021 through 2036, and state net operating loss carryforwards of approximately $137.0 million, which expire in the years 2017 through 2036. At December 31, 2016, the Company had federal research and development credit carryforwards of approximately $1.5 million, which expire in the years 2022 through 2036 and state research and development credit carryforwards of approximately $2.3 million. The state research and development credit carryforwards can be carried forward indefinitely. During 2013, the Company completed a Section 382 study in accordance with the Internal Revenue Code of 1986, as amended, and similar state provisions. The study concluded that the Company has experienced several ownership changes since inception. This causes the Company's utilization of its net operating loss and tax credit carryforwards to be subject to substantial annual limitations. These results are reflected in the above carryforward amounts and deferred tax assets. The Company's ability to utilize its net operating loss and tax credit carryforwards may be further limited as a result of subsequent ownership changes. All such limitations could result in the expiration of carryforwards before they are utilized. An ownership change may have occurred during 2015 and 2016. As a result, tax attributes such as net operating losses and research and development credits may be subject to further limitation. The Company adopted FASB Interpretation ASC 740, Income Taxes (previously Accounting for Uncertainties in Income Taxes - an interpretation of FASB Statement No. 48 ("FIN 48") effective January 1, 2009. FASB ASC 740 requires that the Company recognize the financial statement effects of a tax position when it is more likely than not, based on the technical merits, that the position will be sustained upon examination. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in thousands): Balance at December 31, 2014 $ 856 Additions based on tax positions related to prior year - Additions based on tax positions related to current year 212 Balance at December 31, 2015 1,068 Reduction based on tax positions related to prior year (9 ) Additions based on tax positions related to current year 68 Balance at December 31, 2016 $ 1,127 There were no interest or penalties related to unrecognized tax benefits. Substantially all of the unrecognized tax benefit, if recognized to offset future taxable income would affect the Company’s tax rate. The Company does not anticipate that the amount of existing unrecognized tax benefits will significantly increase or decrease within the next 12 months. Because of net operating loss carryforwards, substantially all of the Company’s tax years remain open to federal tax and state tax examination. The Company files income tax returns in the U.S. federal jurisdiction and California. Federal and California corporation income tax returns beginning with the 2001 tax year remain subject to examination by the Internal Revenue Service and the California Franchise Tax Board, respectively. |
Employee Benefit Plan
Employee Benefit Plan | 12 Months Ended |
Dec. 31, 2016 | |
Compensation and Retirement Disclosure [Abstract] | |
Employee Benefit Plan | 13. Employee Benefit Plan The Company has established a 401(k) tax‑deferred savings plan (the “401(k) Plan”), which permits participants to make contributions by salary deduction pursuant to Section 401(k) of the Internal Revenue Code. The Company is responsible for administrative costs of the 401(k) Plan. The Company may, at its discretion, make matching contributions to the 401(k) Plan. No employer contributions have been made to date. |
Litigation
Litigation | 12 Months Ended |
Dec. 31, 2016 | |
Litigation [Abstract] | |
Litigation | 14. Litigation Bankruptcy Proceeding The Company filed for protection under Chapter 11 of Title 11 of the United States Bankruptcy Code on December 29, 2015. See Note 2 for additional information related to the bankruptcy. Securities Class Action Litigation On December 18, 2015, a putative class action lawsuit (captioned Li v. KaloBios Pharmaceuticals, Inc. et al. , 5:15-cv-05841-EJD) United States District Court for the Northern District of California (the “Class Action Court”), alleging violations of the federal securities laws by the Company, Herb Cross and Martin Shkreli, the Company’s former Chairman and Chief Executive Officer. On December 23, 2015, a putative class action lawsuit was filed against the Company in the Class Action Court (captioned Sciabacucchi v. KaloBios Pharmaceuticals, Inc. et al. , 3:15-cv-05992-CRB), similarly alleging violations of the federal securities laws by the Company and Mr. Shkreli. On December 31, 2015, a putative class action lawsuit was filed against the Company in the Class Action Court (captioned Isensee v. KaloBios Pharmaceuticals, Inc. et al. , Case No. 15-cv-06331-EJD) also alleging violation of the federal securities laws by the Company, a former officer and Mr. Shkreli. On April 18, 2016, and amended complaint was filed in the Isensee suit, adding Herb Cross and Ronald Martell as defendants. On April 28, 2016, the Class Action Court consolidated these cases (the “Securities Class Action Litigation”) and appointed certain plaintiffs as the lead plaintiffs. The lead plaintiffs in the Securities Class Action Litigation were seeking damages of $20.0 million on behalf of all the affected members of the class represented in the Securities Class Action Litigation, (the “Securities Class Action Members”). On June 15, 2016, a settlement stipulation (the “Securities Class Action Settlement”), was approved by the Bankruptcy Court. Subject to the approval of the Class Action Court, the Securities Class Action Settlement required the Company to issue 300,000 shares of common stock and submit a payment of $250,000 to the Securities Class Action Members and advance insurance proceeds of $1.25 million to the Securities Class Action Members (collectively, the consideration is the “Securities Class Action Settlement Consideration”). On January 20, 2017, the Class Action Court preliminarily approved the Securities Class Action Settlement and set a final settlement approval hearing for May 11, 2017. Subject to the final approval of the Securities Class Action Settlement, any Securities Class Action Member is entitled to share in the Securities Class Action Settlement Consideration. The Securities Class Action Settlement provides for releases and related injunctions to be granted for the benefit of, among others, the Company, Ronald Martell, Herb Cross and all of the Company’s past, present and future directors, officers and employees, excluding Mr. Shkreli. The Company’s agreement to the Securities Class Action Settlement was not in any way an admission of the Company’s wrongdoing or liability. As of December 31, 2016, the 300,000 shares have been issued and the $250,000 payment has been made. PIPE Litigation On January 7, 2016, certain investors (the “PIPE Claimants”), commenced an adversary proceeding (captioned Gregory Rea, et al. v. KaloBios Pharmaceuticals, Inc. , Adv. Pro. No. 16-50001 (LSS)) in the Bankruptcy Court against the Company alleging implied trust theories, breach of contract, fraud and violations of the federal securities laws in connection with the PIPE Claimants’ purchase of the Company’s common stock in the Private Placement (the “PIPE Litigation”). The PIPE Claimants also raised certain other objections to the Company’s bankruptcy proceeding. The PIPE Claimants sought an aggregate total of approximately $6.9 million in damages. On May 9, 2016, the Bankruptcy Court entered an order approving a settlement stipulation between the Company and the PIPE Claimants (the “Settlement Stipulation”). Under the Settlement Stipulation, in connection with the effectiveness of the Plan, and per the terms of the Settlement Stipulation, the Company became obligated to issue 327,608 shares to the PIPE Claimants and make a payment of $250,000 to the PIPE Claimants for the purpose of satisfying expenses related to the PIPE Litigation. As of December 31, 2016, the 327,608 shares have been issued and the $250,000 payment has been made. Claim by Marek Biestek Marek Biestek was a director of the Company who, while not a plaintiff in the above described PIPE Litigation, filed a proof of claim alleging damages from the PIPE transaction and filed an objection to the confirmation of the Plan. To resolve his objection to the Plan and his proof of claim, the Company settled with him individually by issuing him 3,750 additional shares of common stock. Mr. Biestek, as a former director of the Company, was excluded from the Securities Class Action Members and therefore received nothing from the Securities Class Action Litigation. As of December 31, 2015, the Company recorded an obligation in stockholders’ equity to issue the shares related to the above claims totaling approximately $2.8 million and recorded the cash liability of $500,000 in Liabilities subject to compromise in the accompanying Consolidated Balance Sheet. As of December 31, 2016, all of the above claims have been satisfied and shares issued. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2016 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 15. Related Party Transactions On December 3, 2015, the Company entered into a Services Agreement (the “Services Agreement”) with Turing Pharmaceuticals LLC (“Turing”), a life sciences company. The Company’s then Chairman and Chief Executive Officer, Martin Shkreli, was also the chief executive officer and a member of the board of directors of Turing. Pursuant to the Services Agreement, Turing was to provide certain employees to the Company, to utilize on a part-time basis, including Christopher Thorn, who was appointed as the Company’s interim chief financial officer on December 3, 2015. The Services Agreement provided that Turing would charge the Company for Mr. Thorn’s services an hourly rate of $151.92 per hour, and Mr. Thorn would remain employed and compensated by Turing during the term of the Services Agreement. No amounts have been, or will be, paid by the Company to Turing, and Mr. Thorn resigned on December 21, 2015. On December 3, 2015, the Company entered into the Securities Purchase Agreement, as defined in Note 7, for the private placement (the “Private Placement”) by the Company of shares of the Company’s common stock. At the time of the Private Placement, certain participants were serving as directors of the Company. These participants purchased a total of 21,936 shares of the Company’s common stock at a per share price of $29.32 for a total of $643,200. On May 24, 2016, the board of directors approved a one-time equity award (the “Equity Award”) to each of Cameron Durrant, Ronald Barliant and David Moradi. On June 30, 2016, in accordance with the Plan, the Company issued an aggregate of 323,155 shares of common stock under the Equity Award. The Company recorded a charge of $1,451,000 representing the fair value of the shares issued and classified $700,000 and $751,000 as Reorganization items, net and General and administrative expenses, respectively. On June 30, 2016, in connection with the settlement of the Term Loan, as defined in Note 2, 2,115,432 shares of common stock were issued to certain Lenders in repayment of the Company’s debt obligations who were deemed to be affiliates of the Company. On December 21, 2016, the Company entered into the December Term Loan, as more fully described in Note 7, with certain lenders who were deemed to be affiliates of the Company. |
Summary of Significant Accoun22
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Use of Estimates | Basis of Presentation and Use of Estimates The accompanying Consolidated Financial Statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and include all adjustments necessary for the presentation of the Company’s consolidated financial position, results of operations and cash flows for the periods presented. The Consolidated Financial Statements include the accounts of the Company and its wholly owned subsidiaries. These financial statements have been prepared on a basis that assumes that the Company will continue as a going concern, which contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of business. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts and disclosures reported in the Consolidated Financial Statements and accompanying notes. Actual results could differ materially from those estimates. The Company believes judgment is involved in determining the valuation of the financing derivative, the fair value‑based measurement of stock‑based compensation, accruals, liabilities subject to compromise and warrant valuations. The Company evaluates its estimates and assumptions as facts and circumstances dictate. As future events and their effects cannot be determined with precision, actual results could differ from these estimates and assumptions, and those differences could be material to the Consolidated Financial Statements. |
Concentration of Credit Risk | Concentration of Credit Risk Cash, cash equivalents, and marketable securities consist of financial instruments that potentially subject the Company to a concentration of credit risk in the event of a default by the related financial institution holding the securities, to the extent of the value recorded in the balance sheet. The Company invests cash that is not required for immediate operating needs primarily in highly liquid instruments with lower credit risk. The Company has established guidelines relating to the quality, diversification, and maturities of securities to enable the Company to manage its credit risk. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Cash, accounts payable and accrued liabilities are carried at cost, which approximates fair value given their short‑term nature. Marketable securities and cash equivalents are carried at fair value. The fair value of financial instruments reflects the amounts that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The fair value hierarchy is based on three levels of inputs that may be used to measure fair value, of which the first two are considered observable, and the third is considered unobservable, as follows: Level 1—Quoted prices in active markets for identical assets or liabilities. Level 2—Inputs other than those included in Level 1 that are directly or indirectly observable, such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The Company measures the fair value of financial assets and liabilities using the highest level of inputs that are reasonably available as of the measurement date. The following tables summarize the fair value of financial assets (marketable securities) that are measured at fair value, and the classification by level of input within the fair value hierarchy: Fair Value Measurements as of December 31, 2016 (in thousands) Level 1 Level 2 Level 3 Total Investments: Money market funds $ 101 $ — $ — $ 101 Total assets measured at fair value $ 101 $ — — $ 101 Fair Value Measurements as of December 31, 2015 (in thousands) Level 1 Level 2 Level 3 Total Investments: Money market funds $ 196 $ — $ — $ 196 Total assets measured at fair value $ 196 $ — — $ 196 The estimated fair value of the December Term Loan payable and the Notes payable to vendors as of December 31, 2016, based upon current market rates for similar borrowings, as measured using Level 3 inputs, approximate the carrying amounts as presented in the Consolidated Balance Sheet. There were no notes payable as of December 31, 2015. |
Cash, Cash Equivalents, and Marketable Securities | Cash, Cash Equivalents, and Marketable Securities The Company considers all highly liquid investments with an original maturity of 90 days or less at the time of purchase to be cash equivalents. Cash and cash equivalents consist of deposits with commercial banks in checking, interest‑bearing and demand money market accounts. The Company invests in marketable securities consisting primarily of certificates of deposit, money market funds, corporate securities, commercial paper, U.S. government‑backed securities and U.S. treasury notes. These securities are classified as available‑for‑sale and carried at estimated fair value, with unrealized gains and losses reported as part of accumulated other comprehensive income (loss), a separate component of stockholders’ equity. Realized gains and losses from the sale of marketable securities are calculated using the specific‑identification method. Realized gains and losses and declines in value judged to be other‑than‑temporary are included in Other expense, net in the Consolidated Statements of Operations and Comprehensive Loss. To date, the Company has not recorded any impairment charges on its marketable securities related to other‑than‑temporary declines in market value. In determining whether a decline in market value is other‑than‑temporary, various factors are considered, including whether the decline is attributed to a change in credit risk and whether it is more likely‑than‑not that the Company will hold the security for a period of time sufficient to allow for an anticipated recovery in market value. The Company recognized a net gain from the sale of marketable securities of $8,000 for the year ended December 31, 2015. The Company had no realized gains or losses from the sale of marketable securities for the year ended December 31, 2016. |
Restricted Cash | Restricted Cash Restricted cash at December 31, 2016 consisted of $101,000 related to a standby letters of credit in the amount of $50,000 issued in connection with certain insurance policy coverage maintained by the Company and restricted cash related to a credit card facility in the amount of $51,000. Restricted cash at December 31, 2015 consisted of $193,000 related to standby letters of credit issued in connection with an operating lease for the Company’s corporate headquarters and certain insurance policy coverage maintained by the Company. |
Property and Equipment, Net | Property and Equipment, Net Property and equipment is stated at cost, less accumulated depreciation and amortization, and depreciated over the estimated useful lives of the respective assets of three years using the straight‑line method. Leasehold improvements are amortized on a straight‑line basis over the shorter of the useful lives or the non-cancelable term of the related lease. Maintenance and repair costs are charged as expense in the Statements of Operations and Comprehensive Loss as incurred. |
Long-Lived Assets | Long‑Lived Assets The Company evaluates the carrying value of its long‑lived assets, including intangible assets, whenever events or changes in circumstances indicate that the carrying value of the asset may be impaired. An impairment loss would be recognized when estimated future cash flows expected to result from the use of the asset, including disposition, are less than the carrying value of the asset. To date, the Company has not recorded any impairment charges on its long‑lived assets. |
Debt Issue Costs | Debt Issue Costs As of January 1, 2016, the Company adopted Financial Accounting Standards Board (“FASB”) Accounting Standards Update (“ASU”) No. 2015-03 and No. 2015-15, which require that debt issuance costs related to a recognized debt liability be presented on the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. As a result of our adoption of the guidance, as of December 31, 2016, $460,000 of deferred financing costs were reclassified to reduce the Term loan payable in the Consolidated Balance Sheet. The guidance did not have a material impact on the consolidated financial statements. |
Research and Development Expenses | Research and Development Expenses Development costs incurred in the research and development of new product candidates are expensed as incurred, including expenses that may or may not be reimbursed under research and development collaboration arrangements. Research and development costs include, but are not limited to, salaries, benefits, stock‑based compensation, laboratory supplies, allocated overhead, fees for professional service providers and costs associated with product development efforts, including preclinical studies and clinical trials. Research and development expenses under collaborative agreements approximate or exceed the revenue recognized under such agreements. The Company estimates preclinical study and clinical trial expenses based on the services performed, pursuant to contracts with research institutions and clinical research organizations that conduct and manage preclinical studies and clinical trials on its behalf. In accruing service fees, the Company estimates the time period over which services will be performed and the level of effort to be expended in each period. If the actual timing of the performance of services or the level of effort varies from the estimate, the Company will adjust the accrual accordingly. Payments made to third parties under these arrangements in advance of the receipt of the related services are recorded as prepaid expenses until the services are rendered. The Company records upfront and milestone payments made to third parties under licensing arrangements as an expense. Upfront payments are recorded when incurred and milestone payments are recorded when the specific milestone has been achieved. |
Research and Development Services | Research and Development Services Internal and external research and development costs incurred in connection with collaboration agreements are recognized as revenue in the same period as the costs are incurred and are presented on a gross basis when the Company acts as a principal, has the discretion to choose suppliers, bears credit risk, and performs at least part of the services. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue when: (i) persuasive evidence of an arrangement exists, (ii) transfer of technology has been completed, delivery has occurred or services have been rendered, (iii) the fee is fixed or determinable, and (iv) collectability is reasonably assured. Payments received in advance of work performed are recorded as deferred revenue and recognized when earned. All revenue recognized to date under the Company’s collaborative agreements has been nonrefundable. |
Multiple Element Arrangements | Multiple Element Arrangements The Company evaluates revenue from agreements that have multiple elements to determine whether the components of the arrangement represent separate units of accounting. Management considers whether components of an arrangement represent separate units of accounting based upon whether certain criteria are met, including whether the delivered element has stand‑alone value to the customer. To date, all of the Company’s research and development collaboration and license agreements have been assessed to have one unit of accounting. Up‑front and license fees received for a combined unit of accounting are deferred and recognized ratably over the projected performance period. Nonrefundable fees where the Company has no continuing performance obligations are recognized as revenue when collection is reasonably assured and all other revenue recognition criteria have been met. |
Stock-Based Compensation Expense | Stock-Based Compensation Expense The Company measures employee and director stock-based compensation expense for stock awards at the grant date, based on the fair value-based measurement of the award, and the expense is recorded over the related service period, generally the vesting period, net of estimated forfeitures. The Company calculates the fair value‑based measurement of stock options using the Black-Scholes valuation model and the single-option method and recognizes expense using the straight-line attribution approach. The Company accounts for equity instruments issued to non-employees in accordance with the provisions of ASC 505, Equity Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Company’s Own Stock. |
Income Taxes | Income Taxes The Company accounts for income taxes under an asset‑and‑liability approach. Deferred income taxes reflect the impact of temporary differences between assets and liabilities recognized for tax and financial reporting purposes measured by applying enacted tax rates and laws that will be in effect when the differences are expected to reverse, net operating loss carryforwards and tax credits. Valuation allowances are provided when necessary to reduce net deferred tax assets to an amount that is more likely than not to be realized. The Company’s policy is to include interest and penalties related to unrecognized tax benefits within the Company’s provision for income taxes. |
Comprehensive Loss | Comprehensive Loss Comprehensive loss represents net loss adjusted for the change during the periods presented in unrealized gains and losses on available‑for‑sale securities less reclassification adjustments for realized gains or losses included in net loss. The unrealized gains or losses are reported on the Consolidated Statements of Operations and Comprehensive Loss. |
Net Loss Per Common Share | Net Loss Per Common Share Basic net loss per common share is calculated by dividing the net loss attributable to common stockholders by the weighted‑average number of common shares outstanding during the period, without consideration for potentially dilutive securities. Diluted net loss per share is computed by dividing the net loss attributable to common stockholders by the weighted‑average number of common shares and potentially dilutive securities outstanding for the period determined using the treasury‑stock and if‑converted methods. For purposes of the diluted net loss per share calculation, stock options, restricted stock units and common stock warrants are considered to be potentially dilutive securities but are excluded from the calculation of diluted net loss per share because their effect would be anti‑dilutive and therefore, basic and diluted net loss per share were the same for all periods presented. The Company’s potential dilutive securities, which include stock options, restricted stock units and warrants have been excluded from the computation of diluted net loss per share as the effect would be to reduce the net loss per common share and be antidilutive. Therefore, the denominator used to calculate both basic and diluted net loss per common share is the same in all periods presented. The following shares subject to outstanding potentially dilutive securities have been excluded from the computations of diluted net loss per common share as the effect of including such securities would be antidilutive: Year Ended December 31, 2016 2015 Options to purchase common stock 1,835,835 465,401 Warrants to purchase common stock 356,193 131,193 Restricted stock units - 3,750 2,192,028 600,344 |
Deferred Rent | Deferred Rent The Company records its costs under facility operating lease agreements as rent expense. Rent expense is recognized on a straight‑line basis over the non‑cancelable term of the operating lease. The difference between the actual amounts paid and amounts recorded as rent expense is recorded to deferred rent. |
Segment Reporting | Segment Reporting The Company determines its segment reporting based upon the way the business is organized for making operating decisions and assessing performance. The Company operates in only one segment, which is related to the development of pharmaceutical products. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements The Company qualifies as an “emerging growth company” (“EGC”) pursuant to the provisions of the JOBS Act and has elected to take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act which permits EGCs to defer compliance with new or revised accounting standards (the “EGC extension”) until non-issuers are required to comply with such standards. Accordingly, so long as the Company continues to qualify as an EGC, the Company will not have to adopt or comply with new accounting standards until non-issuers are required to comply with such standards. In May 2014, the FASB issued ASU 2014-09, "Revenue from Contracts with Customers (Topic 606)." ASU 2014-09 completes the joint effort by the FASB and International Accounting Standards Board to improve financial reporting by creating common revenue recognition guidance for U.S. GAAP and International Financial Reporting Standards. ASU 2014-09 applies to all companies that enter into contracts with customers to transfer goods or services. ASU 2014-09 is effective for public entities for interim and annual reporting periods beginning after December 15, 2017. Early application is not permitted and entities have the choice to apply ASU 2014-09 either retrospectively to each reporting period presented or by recognizing the cumulative effect of applying ASU 2014-09 at the date of initial application and not adjusting comparative information. The Company is currently evaluating the requirements of ASU 2014-09 and has not yet determined its impact on the Company's Consolidated Financial Statements. In August 2014, the FASB issued ASU 2014-15, “Presentation of Financial Statements - Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern”, which defines management’s responsibility to evaluate, at each annual and interim reporting period, whether there are conditions or events that raise substantial doubt about an entity’s ability to continue as a going concern within one year after the date the financial statements are issued and to provide related footnote disclosures in certain circumstances. In connection with each annual and interim period, management must assess if there is substantial doubt about the company’s ability to continue as a going concern within one year after the issuance date. Disclosures are required if conditions give rise to substantial doubt. This standard is effective for all companies in the first annual period ending after December 15, 2016, and interim periods thereafter, with early adoption permitted. The Company adopted this standard at December 31, 2016 and the adoption had no impact on its consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842)”, which requires lessees to recognize on the balance sheet a right-of use asset, representing its right to use the underlying asset for the lease term, and a lease liability for all leases with terms greater than 12 months. The guidance also requires qualitative and quantitative disclosures designed to assess the amount, timing, and uncertainty of cash flows arising from leases. The standard requires the use of a modified retrospective transition approach, which includes a number of optional practical expedients that entities may elect to apply. Early application is permitted. The Company is currently evaluating the requirements of ASU 2016-02 and has not yet determined its impact on the Company’s Consolidated Financial Statements. In March 2016, the FASB issued Accounting Standards Update 2016-09, Stock Compensation – Improvements to Employee Share-Based Payment Accounting |
Chapter 11 Filing (Tables)
Chapter 11 Filing (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Chapter 11 Filing Tables | |
Schedule of Credit Agreement Items | Year ended (in thousands) December 31, 2016 Upfront fee $ 191 Commitment fee 150 Beneficial conversion feature 484 Legal fees 802 Total Credit Agreement expense $ 1,627 |
Schedule of Reorganization Items, Net | For the year ended December 31, 2016, Reorganization items, net consisted of the following charges: Year ended (in thousands) December 31, 2016 Legal fees $ 4,870 Professional fees 1,218 Debtor-in-possession financing costs 1,143 Beneficial conversion on debtor-in-possession financing 484 Fair value of shares issued to officer and directors for service in bankruptcy 700 Gain on lease termination (227 ) Total reorganization items, net $ 8,188 |
Summary of Significant Accoun24
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Schedule of fair value of financial assets and liabilities measured at fair value and classification by level of input | The Company measures the fair value of financial assets and liabilities using the highest level of inputs that are reasonably available as of the measurement date. The following tables summarize the fair value of financial assets (marketable securities) that are measured at fair value, and the classification by level of input within the fair value hierarchy: Fair Value Measurements as of December 31, 2016 (in thousands) Level 1 Level 2 Level 3 Total Investments: Money market funds $ 101 $ — $ — $ 101 Total assets measured at fair value $ 101 $ — — $ 101 Fair Value Measurements as of December 31, 2015 (in thousands) Level 1 Level 2 Level 3 Total Investments: Money market funds $ 196 $ — $ — $ 196 Total assets measured at fair value $ 196 $ — — $ 196 |
Schedule of antidilutive securities excluded from computations of diluted net loss per common share | The following shares subject to outstanding potentially dilutive securities have been excluded from the computations of diluted net loss per common share as the effect of including such securities would be antidilutive: Year Ended December 31, 2016 2015 Options to purchase common stock 1,835,835 465,401 Warrants to purchase common stock 356,193 131,193 Restricted stock units - 3,750 2,192,028 600,344 |
Investments (Tables)
Investments (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of amortized cost and fair value of investments, with gross unrealized gains and losses | At December 31, 2016, the amortized cost and fair value of investments, with gross unrealized gains and losses, were as follows: Amortized Gross Unrealized Gross Unrealized (in thousands) Cost Gains Losses Fair Value Money market funds $ 101 $ — $ — $ 101 Total investments $ 101 $ — $ — $ 101 Reported as: Cash and cash equivalents $ — Restricted cash 101 Total investments $ 101 At December 31, 2015, the amortized cost and fair value of investments, with gross unrealized gains and losses, were as follows: Gross Gross Amortized Unrealized Unrealized (in thousands) Cost Gains Losses Fair Value Money market funds $ 196 $ — $ — $ 196 Total investments $ 196 $ — $ — $ 196 Reported as: Cash and cash equivalents $ 3 Restricted cash, long-term 193 Total investments $ 196 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property and equipment | Property and equipment consists of the following: December 31, (In thousands) 2016 2015 Computer equipment and software $ 216 $ 330 Leasehold improvements, furniture and fixtures — 189 216 519 Accumulated depreciation and amortization (148 ) (231 ) Property and equipment, net $ 68 $ 288 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of future minimum lease payments and sublease payments under the agreements | As of December 31, 2016, future minimum lease payments due under the Company’s lease, including the lease amendment executed on February 16, 2017, are as follows: (in thousands) 2017 $ 240 2018 202 Total $ 442 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Stockholders' Equity Note [Abstract] | |
Schedule of shares of common stock reserved for issuance | The Company had reserved the following shares of common stock for issuance as of December 31, 2016: Warrants to purchase common stock 356,193 Options: Outstanding under the 2012 Equity Incentive Plan 1,826,548 Outstanding under the 2001 Equity Incentive Plan 9,287 Available for future grants under the 2012 Equity Incentive Plan 1,980,201 Total common stock reserved for future issuance 4,172,229 |
Summary of stock option activity | The following table summarizes stock option activity for the year ended December 31, 2016: Weighted- Weighted- Average Average Remaining Exercise Contractual Aggregate Number of Price Term Intrinsic Value Shares (Per Share)(1) (in years) (in thousands)(2) Balances at December 31, 2014 334,686 $ 34.00 Options granted 321,020 3.46 Options forfeited (176,764 ) 17.58 Options expired (13,541 ) 24.32 Options exercised — — Balances at December 31, 2015 465,401 $ 19.29 Options granted 1,778,022 3.38 Options forfeited (3,416 ) 5.86 Options expired (398,547 ) 18.38 Options exercised (5,625 ) 1.77 Balances at December 31, 2016 1,835,835 $ 4.15 9.50 $ 947,896 As of December 31, 2016: Options vested and expected to vest 1,829,593 $ 4.15 9.50 $ 944,673 Exercisable 287,041 $ 8.35 8.46 $ 133,792 (1) The weighted average price per share is determined using exercise price per share for stock options. (2) The aggregate intrinsic value is calculated as the difference between the exercise price of the option and the fair value of the Company’s common stock for in‑the‑money options at December 31, 2016. |
Schedule of stock options outstanding and exercisable by exercise price | The stock options outstanding and exercisable by exercise price at December 31, 2016 are as follows: Stock Options Outstanding Stock Options Exercisable Weighted- Average Weighted- Weighted- Remaining Average Average Number Contractual Exercise Number of Exercise Range of Exercise Prices Shares In Years Per Share Shares Per Share $1.91 - $1.91 8,500 8.76 $ 1.91 2,479 $ 1.91 $2.11 - $3.30 51,800 9.74 3.26 50,562 3.29 $3.38 - $3.38 1,678,022 9.71 3.38 139,831 3.38 $3.40 - $4.72 55,712 9.63 3.52 52,430 3.45 $8.24 - $17.36 9,200 1.13 9.78 9,200 9.78 $42.88 - $48.00 32,601 1.08 45.52 32,539 45.52 1,835,835 9.50 $ 4.15 287,041 $ $8.35 |
Schedule of fair value-based measurement of stock options granted under the entity's stock plans estimated using Black-Scholes model | The fair value‑ based measurement of stock options granted under the Company’s stock plans was estimated at the date of grant using the Black‑Scholes model with the following assumptions: Year Ended December 31, 2016 2015 Expected term 5-6 years 5-6 years Expected volatility 85 - 90% 67 - 78% Risk-free interest rate 1.3 - 1.4% 1.5 - 1.8% Expected dividend yield 0% 0% |
Schedule of total stock-based compensation expense recognized | Total stock‑based compensation expense recognized was as follows: Year Ended December 31, (In thousands) 2016 2015 General and administrative $ 547 $ 1,134 Research and development 297 837 $ 844 $ 1,971 |
Restructuring Charges (Tables)
Restructuring Charges (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Restructuring and Related Activities [Abstract] | |
Schedule of activity in accrued restructuring balance, included within accrued compensation | (in thousands) Contract termination costs - R&D Salaries and benefits - R&D Salaries and benefits - G&A Total Balance as of December 31, 2014 $ 1,185 $ - $ - $ 1,185 Accrued - 1,167 1,011 2,178 Adjustments (78 ) - - (78 ) Paid (1,107 ) (1,167 ) (1,000 ) (3,274 ) Balance as of December 31, 2015 $ - $ - $ 11 $ 11 Accrued - - - - Adjustments - - (11 ) (11 ) Paid - - - - Balance as of December 31, 2016 $ - $ - $ - $ - |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Schedule of significant components of deferred tax assets | Significant components of the Company's deferred tax assets are as follows (in thousands): December 31, 2016 2015 Deferred tax assets: Net operating losses $ 57,903 $ 49,145 Research & other credits 2,121 1,978 Stock based compensation 2,164 1,047 In-Process R&D 1,246 — Accrued bankruptcy settlement — 1,328 Other 761 222 Total deferred tax assets 64,195 53,720 Valuation allowance (64,195 ) (53,720 ) Net deferred tax assets $ — $ — |
Schedule of reconciliation of the statutory tax rates and the effective tax rates | A reconciliation of the statutory tax rates and the effective tax rates for the years ended December 2016 and 2015 is as follows: Year Ended December 31, 2016 2015 Statutory rate 34.0 % 34.0 % Valuation allowance (34.8 ) (31.1 ) Nondeductible stock compensation (0.1 ) (2.9 ) Other 0.9 - Effective tax rate - % - % |
Reconciliation of Beginning And Ending Amount Of Unrecognized Tax Benefits | A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in thousands): Balance at December 31, 2014 $ 856 Additions based on tax positions related to prior year - Additions based on tax positions related to current year 212 Balance at December 31, 2015 1,068 Reduction based on tax positions related to prior year (9 ) Additions based on tax positions related to current year 68 Balance at December 31, 2016 $ 1,127 |
Organization and Description 31
Organization and Description of Business (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016USD ($)item | Dec. 31, 2015USD ($) | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Accumulated deficit | $ 240,610 | $ 213,591 |
Number of product candidates approved for sale | item | 0 | |
Total liabilities | $ 9,097 | $ 5,414 |
Chapter 11 Filing (Details)
Chapter 11 Filing (Details) | May 09, 2016USD ($)shares | Apr. 03, 2016USD ($)shares | Mar. 31, 2016USD ($)shares | Dec. 03, 2015USD ($)shares | Dec. 31, 2016USD ($)Claimshares | Jun. 30, 2016USD ($)shares | May 24, 2016USD ($)shares | Dec. 31, 2016USD ($)shares | Dec. 31, 2015USD ($) |
Litigation accrual expense | $ 3,335,000 | ||||||||
Bankruptcy claims, amount | $ 32,000,000 | ||||||||
Number of claims | Claim | 195 | ||||||||
Liabilities subject to compromise | 5,414,000 | ||||||||
Stock issued during period, shares | shares | 21,936 | ||||||||
Stock issued during period, value | $ 643,200 | 10,132,000 | 8,218,000 | ||||||
Property and equipment, net | 68,000 | 68,000 | 288,000 | ||||||
Gain on lease termination | 227,000 | ||||||||
Accounts payable | 4,072,000 | 4,072,000 | |||||||
Notes payable to vendors | 1,273,000 | 1,273,000 | |||||||
Beneficial conversion feature | 484,000 | 484,000 | |||||||
Cash payment for reorganization items | $ 5,000,000 | ||||||||
Martin Shkreli [Member] | |||||||||
Description of governance agreement | Under the terms of the Governance Agreement, for 180 days following the Effective Date, Mr. Shkreli could not sell his shares of common stock at a price per share that was less than the greater of (x) $2.50 and (y) a 10% discount to the prior two week volume-weighted average price (the “Market Discount Price”). In addition, for 180 days following the 61st day after the Effective Date, the Company had a right to purchase any or all of Mr. Shkreli’s shares at a purchase price per share equal to the Market Discount Price. For a limited time, the Company also had a right of first refusal to purchase shares that Mr. Shkreli proposed to sell. Mr. Shkreli was also prohibited from transferring any shares to his affiliates or associates unless such transferee agreed to be subject to the terms of the Governance Agreement. Transfers of shares by Mr. Shkreli not made in compliance with the Governance Agreement would be null and void. | ||||||||
Subject To Review By Bankruptcy Court [Member] | |||||||||
Bankruptcy claims, amount | $ 850,000 | ||||||||
Accounts payable | 130,000 | 130,000 | |||||||
Notes payable to vendors | 124,000 | 124,000 | |||||||
Contract Termination [Member] | |||||||||
Deferred rent liabilities | 312,000 | ||||||||
Property and equipment, net | 85,000 | ||||||||
Gain on lease termination | 227,000 | ||||||||
Financial Reporting In Reorganization [Member] | |||||||||
Liabilities subject to compromise | 3,400,000 | 3,400,000 | 5,400,000 | ||||||
Accrued expenses | 100,000 | 100,000 | 800,000 | ||||||
Deferred rent liabilities | 300,000 | 300,000 | |||||||
Accounts payable | 400,000 | 400,000 | 2,800,000 | ||||||
Notes payable to vendors | 1,200,000 | $ 1,200,000 | 1,200,000 | ||||||
Net Expense [Member] | |||||||||
Stock issued during period, value | 700,000 | $ 700,000 | |||||||
General and administrative expenses [Member] | |||||||||
Stock issued during period, value | $ 751,000 | ||||||||
Equity Award [Member] | |||||||||
Stock issued during period, shares | shares | 323,155 | 323,155 | |||||||
Stock issued during period, value | $ 1,451,000 | $ 1,451,000 | |||||||
Former Director [Member] | |||||||||
Litigation accrual expense | $ 16,000 | 16,000 | |||||||
Shares reserved for issuance in connection with class action lawsuit | shares | 3,750 | 3,750 | 3,750 | ||||||
PIPE Litigation Plaintiffs [Member] | |||||||||
Litigation accrual expense | $ 1,500,000 | ||||||||
Shares reserved for issuance in connection with class action lawsuit | shares | 327,608 | 327,608 | |||||||
Litigation claims amount | $ 6,900,000 | ||||||||
Class Action Suit Related To Former CEO [Member] | |||||||||
Litigation accrual expense | $ 1,300,000 | $ 1,300,000 | |||||||
Shares reserved for issuance in connection with class action lawsuit | shares | 300,000 | ||||||||
Litigation claims amount | $ 20,000,000 | ||||||||
Shares awarded to claimants | shares | 300,000 | ||||||||
Damages awarded to claimants | $ 250,000 | ||||||||
Claim Filed By Certain Investors In Connection With 2015 Private Financing Transaction [Member] | |||||||||
Litigation claims amount | $ 6,900,000 | ||||||||
Shares awarded to claimants | shares | 327,608 | ||||||||
Damages awarded to claimants | $ 250,000 | ||||||||
Obligation to issue shares | 2,800,000 | 2,800,000 | |||||||
Liabilities subject to compromise | 500,000 | 500,000 | |||||||
All Other Proofs of Claim [Member] | |||||||||
Litigation claims amount | 4,500,000 | ||||||||
Liabilities subject to compromise | 5,100,000 | 5,100,000 | |||||||
All Other Proofs of Claim [Member] | Accrued Liabilities [Member] | |||||||||
Liabilities subject to compromise | $ 400,000 | $ 400,000 | |||||||
Securities Purchase Agreement [Member] | |||||||||
Interest rate | 12.00% | ||||||||
Debt instrument amount | $ 11,000,000 | ||||||||
Shares issued as bankruptcy settlement | shares | 9,497,515 | ||||||||
Commitment fee | $ 770,000 | ||||||||
Shares issued for repayment of debt | shares | 7,147,035 | ||||||||
Securities Purchase Agreement [Member] | Black Horse Capital LP [Member] | |||||||||
Shares issued for repayment of debt | shares | 612,501 | ||||||||
Payments for fees and expenses | $ 427,000 | ||||||||
Securities Purchase Agreement [Member] | Black Horse Capital Master Fund Ltd. [Member] | |||||||||
Shares issued for repayment of debt | shares | 1,429,407 | ||||||||
Securities Purchase Agreement [Member] | Cheval Holdings, Ltd. [Member] | |||||||||
Shares issued for repayment of debt | shares | 1,531,610 | ||||||||
Securities Purchase Agreement [Member] | Nomis Bay LTD [Member] | |||||||||
Shares issued for repayment of debt | shares | 2,858,814 | ||||||||
Payments for fees and expenses | $ 304,000 | ||||||||
Securities Purchase Agreement [Member] | Cortleigh Limited [Member] | |||||||||
Shares issued for repayment of debt | shares | 714,703 | ||||||||
Promissory Notes To Holders Of Unsecured Claims [Member] | |||||||||
Interest rate | 10.00% | 10.00% | |||||||
Debt instrument amount | $ 1,200,000 | $ 1,200,000 | |||||||
Accrued expenses | $ 61,000 | $ 61,000 | |||||||
Credit Agreement [Member] | |||||||||
Debtor in possession amount | $ 3,000,000 | ||||||||
Interest rate | 12.00% | ||||||||
Original discount upfront fee | $ 191,000 | ||||||||
Commitment fee | $ 150,000 | ||||||||
Credit Agreement [Member] | Black Horse Capital LP [Member] | |||||||||
Shares issued for repayment of debt | shares | 201,436 | ||||||||
Payments for fees and expenses | $ 406,000 | ||||||||
Credit Agreement [Member] | Black Horse Capital Master Fund Ltd. [Member] | |||||||||
Shares issued for repayment of debt | shares | 470,096 | ||||||||
Credit Agreement [Member] | Cheval Holdings, Ltd. [Member] | |||||||||
Shares issued for repayment of debt | shares | 503,708 | ||||||||
Credit Agreement [Member] | Nomis Bay LTD [Member] | |||||||||
Shares issued for repayment of debt | shares | 940,192 | ||||||||
Payments for fees and expenses | $ 285,000 | ||||||||
Credit Agreement [Member] | Cortleigh Limited [Member] | |||||||||
Shares issued for repayment of debt | shares | 235,048 | ||||||||
Additional percentage interest in shares assigned | 20.00% |
Chapter 11 Filing (Credit Agree
Chapter 11 Filing (Credit Agreement Expenses) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Chapter 11 Filing Credit Agreement Expenses Details | ||
Upfront fee | $ 191 | |
Commitment fee | 150 | |
Beneficial conversion feature | 484 | |
Legal fees | 802 | |
Total Credit Agreement expense | $ 1,627 |
Chapter 11 Filing (Reorganizati
Chapter 11 Filing (Reorganization Items, Net) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Chapter 11 Filing Reorganization Items Net Details | ||
Legal fees | $ 4,870 | |
Professional fees | 1,218 | |
Debtor-in-possession financing costs | 1,143 | |
Beneficial conversion on debtor-in-possession financing | 484 | |
Fair value of share issued to officer and directors for service in bankruptcy | 700 | |
Gain on lease termination | (227) | |
Total reorganization items, net | $ 8,188 |
Summary of Significant Accoun35
Summary of Significant Accounting Policies (Narrative) (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016USD ($)itemshares | Dec. 31, 2015USD ($) | Dec. 06, 2015shares | |
Accounting Policies [Abstract] | |||
Realized gains or losses from sale of marketable securities | $ 8 | ||
Restricted cash current, standby letters of credit | $ 101 | $ 193 | |
Issuance of letters of credit for insurance policy coverage | 50 | ||
Restricted cash related credit card facility | $ 51 | ||
Property and equipment, estimated useful lives | 3 years | ||
Issuance of warrant to purchase shares of common stock | shares | 460 | 125,000 | |
Number of operating segments | item | 1 |
Summary of Significant Accoun36
Summary of Significant Accounting Policies (Fair Value of Financial Instruments) (Details) - Fair Value Measurements Recurring [Member] - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Estimate Of Fair Value Fair Value Disclosure [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total assets measured at fair value | $ 101 | $ 196 |
Estimate Of Fair Value Fair Value Disclosure [Member] | Money Market Funds [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total assets measured at fair value | 101 | 196 |
Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total assets measured at fair value | 101 | 196 |
Fair Value, Inputs, Level 1 [Member] | Money Market Funds [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total assets measured at fair value | 101 | 196 |
Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total assets measured at fair value | ||
Fair Value, Inputs, Level 2 [Member] | Money Market Funds [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total assets measured at fair value | ||
Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total assets measured at fair value | ||
Fair Value, Inputs, Level 3 [Member] | Money Market Funds [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total assets measured at fair value |
Summary of Significant Accoun37
Summary of Significant Accounting Policies (Potentially Dilutive Securities) (Details) - shares | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computations of diluted net loss per common share | 2,192,028 | 600,344 |
Options to purchase common stock [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computations of diluted net loss per common share | 1,835,835 | 465,401 |
Warrants to purchase common stock [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computations of diluted net loss per common share | 356,193 | 131,193 |
Restricted stock units [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computations of diluted net loss per common share | 3,750 |
Investments (Details)
Investments (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | $ 101 | $ 196 |
Gross Unrealized Gains | ||
Gross Unrealized Losses | ||
Fair Value | 101 | 196 |
Money Market Funds [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 101 | 196 |
Gross Unrealized Gains | ||
Gross Unrealized Losses | ||
Fair Value | 101 | 196 |
Cash And Cash Equivalents [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Fair Value | 3 | |
Restricted Cash [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Fair Value | $ 101 | $ 193 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 216 | $ 519 |
Accumulated depreciation and amortization | (148) | (231) |
Property and equipment, net | 68 | 288 |
Computer equipment and software [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 216 | 330 |
Leasehold improvements, furniture and fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 189 |
Property and Equipment (Narrati
Property and Equipment (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation and amortization expense | $ 102 | $ 197 |
Savant Arrangements (Details)
Savant Arrangements (Details) - USD ($) | Feb. 29, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Sep. 30, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 06, 2015 |
Legal expenses | $ 802,000 | ||||||
Number of shares called by warrant | 460 | 125,000 | |||||
Exercise price of warrant | $ 29.32 | ||||||
Warrant expense included in research and development expenses | $ 361,000,000 | ||||||
Research and development | 10,449,000 | $ 16,721,000 | |||||
Savant Neglected Diseases, LLC [Member] | |||||||
Payments for in process research and development | $ 500,000 | 2,687,500 | $ 250,000 | ||||
Monthly payment amount | 87,500 | 262,500 | |||||
Initial payment amount | $ 3,000,000 | ||||||
Deposit amount | 2,500,000 | ||||||
Legal expenses | $ 100,000 | ||||||
Number of shares called by warrant | 200,000 | 200,000 | |||||
Exercise price of warrant | $ 2.25 | $ 2.25 | |||||
Milestone payments and certain other contingent payments | $ 21,000,000 | ||||||
Exercise period of warrant | 5 years | 5 years | |||||
Fair value of warrants | $ 670,000 | ||||||
Warrant expense included in research and development expenses | $ 87,500 | $ 244,000,000 | |||||
Research and development | $ 3,250,000 | ||||||
Savant Neglected Diseases, LLC [Member] | Exercisable Immediately [Member] | |||||||
Percentage of warrants exercisable | 25.00% |
Notes Payable (Details)
Notes Payable (Details) | 1 Months Ended | 12 Months Ended | ||||||
Nov. 30, 2015USD ($) | Jun. 30, 2013USD ($)$ / sharesshares | Sep. 30, 2012USD ($)tranche | Dec. 31, 2016USD ($)shares | Dec. 31, 2015USD ($) | Jun. 30, 2016USD ($) | Dec. 06, 2015USD ($)$ / sharesshares | Aug. 31, 2015USD ($) | |
Debt Instrument [Line Items] | ||||||||
Exercise price of warrant (in dollars per share) | $ / shares | $ 29.32 | |||||||
Issuance of warrant to purchase shares of common stock | shares | 460 | 125,000 | ||||||
Warrants initial fair value | $ 2,507,000 | |||||||
Gain on extinguishment of debt | $ 61,000 | |||||||
Notes payable to vendors | 1,273,000 | |||||||
Commitment fee | 150,000 | |||||||
December Term Loan [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Accrued interest | 23,000 | |||||||
Line of credit facility on Original amount | 3,315,000 | |||||||
Original Discount Amount | 265,000 | |||||||
Commitment fee | $ 153,000 | |||||||
Term loan interest rate | 9.00% | |||||||
Rate to be paid in the event of default | 14.00% | |||||||
Original principal amount of the loan reduced by the Upfront Fee | $ 2,993,000 | |||||||
Line of Credit interest | 8,000 | |||||||
Loan Cost accretion | 15,000 | |||||||
Balance of Loan as per Balance sheet | $ 3,016,000 | |||||||
Loan And Security Agreement [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Maximum amount of borrowing under the agreement | $ 15,000,000 | |||||||
Amount of remaining borrowing capacity | $ 5,000,000 | |||||||
Number of loan tranches | tranche | 3 | |||||||
Straight-line principal payments period | 36 months | |||||||
Percentage of exit fee of drawn amount | 3.00% | |||||||
Prepayment fee (as a percent) | 1.00% | |||||||
Interest expense related to borrowings | $ 842,000 | |||||||
Effective interest rate (as a percent) | 10.00% | |||||||
Restricted cash for loan repayment | $ 8,300,000 | |||||||
Repayments of debt | $ 6,600,000 | |||||||
Gain on extinguishment of debt | $ 61,000 | |||||||
Loan And Security Agreement [Member] | Minimum [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Prepayment fee (as a percent) | 1.00% | |||||||
Loan And Security Agreement [Member] | Maximum [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Prepayment fee (as a percent) | 2.00% | |||||||
Loan And Security Agreement [Member] | London Interbank Offered Rate L I B O R [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Variable rate basis | one month LIBOR | |||||||
Spread on variable rate (as a percent) | 6.00% | |||||||
LIBOR floor rate | 3.00% | |||||||
Loan And Security Agreement [Member] | First Tranche [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Maximum amount of borrowing under the agreement | $ 5,000,000 | |||||||
Loan And Security Agreement [Member] | Second Tranche [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Maximum amount of borrowing under the agreement | 5,000,000 | |||||||
Loan And Security Agreement [Member] | Third Tranche [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Maximum amount of borrowing under the agreement | $ 5,000,000 | |||||||
Tranche draw down | $ 5,000,000 | |||||||
Loan And Security Agreement [Member] | Third Tranche [Member] | Warrant [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Exercise price of warrant (in dollars per share) | $ / shares | $ 96.88 | |||||||
Issuance of warrant to purchase shares of common stock | shares | 6,193 | |||||||
Warrants initial fair value | $ 130,000 | |||||||
Notes Payable To Vendors [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Notes payable to vendors | $ 1,212,000 | |||||||
Interest rate | 10.00% | |||||||
Accrued interest | $ 61,000 |
Warrants to Purchase Common S43
Warrants to Purchase Common Stock (Details) - USD ($) $ / shares in Units, $ in Thousands | Oct. 31, 2015 | Jun. 30, 2016 | Dec. 31, 2016 | Dec. 06, 2016 | Dec. 06, 2015 |
Class of Warrant or Right [Line Items] | |||||
Issuance of warrant to purchase shares of common stock | 460 | 125,000 | |||
Exercise price of warrants issued (in dollars per share) | $ 29.32 | ||||
Warrants initial fair value | $ 2,507 | ||||
Warrant [Member] | |||||
Class of Warrant or Right [Line Items] | |||||
Issuance of warrant to purchase shares of common stock | 4,874 | 25,000 | |||
Exercise price of warrants issued (in dollars per share) | $ 41.04 | $ 4 | |||
Warrants initial fair value | $ 40 | ||||
Warrants expired, number | 4,874 | ||||
Warrants expired, price per share | $ 41.04 | ||||
Savant Warrant [Member] | |||||
Class of Warrant or Right [Line Items] | |||||
Issuance of warrant to purchase shares of common stock | 200,000 | ||||
Exercise price of warrants issued (in dollars per share) | $ 2.25 | ||||
Warrants initial fair value | $ 670 | ||||
Term of issuance of warrant | 5 years |
Commitments and Contingencies44
Commitments and Contingencies (Narrative) (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | |
Other Commitments [Line Items] | |||
Rent expense | $ 300 | $ 700 | |
San Francisco Lease [Member] | |||
Other Commitments [Line Items] | |||
Deferred rent | $ 311 | ||
Expiration date | Mar. 1, 2017 | ||
Period after which lessee have option to terminate lease | 36 months | ||
Term of new lease | 1 year | ||
Additional term of new lease | 1 year |
Commitments and Contingencies45
Commitments and Contingencies (Future Minimum Lease Payments) (Details) $ in Thousands | Dec. 31, 2016USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2,017 | $ 240 |
2,018 | 202 |
Total | $ 442 |
Stockholders' Equity (Narrative
Stockholders' Equity (Narrative) (Details) - USD ($) | Nov. 07, 2016 | Dec. 15, 2015 | Dec. 03, 2015 | Dec. 31, 2016 | Nov. 15, 2016 | Jun. 30, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | May 09, 2016 | Jul. 13, 2015 | Dec. 31, 2014 |
Class of Stock [Line Items] | |||||||||||
Litigation accrual expense | $ 3,335,000 | ||||||||||
Price per share | $ 29.32 | ||||||||||
Stock issued during period, shares | 21,936 | ||||||||||
Stock issued during period, value | $ 643,200 | $ 10,132,000 | 8,218,000 | ||||||||
Incremental compensation expense | $ 959,000 | ||||||||||
Common Stock, shares authorized upon the completion of the IPO | 85,000,000 | 85,000,000 | 85,000,000 | ||||||||
Common stock, shares outstanding | 14,977,397 | 14,977,397 | 4,450,994 | 4,100,000 | |||||||
Warrants to purchase common stock | 356,193 | 356,193 | |||||||||
Options oustanding | 1,835,835 | 1,835,835 | 465,401 | 334,686 | |||||||
Total common stock reserved for future issuance | 4,172,229 | 4,172,229 | |||||||||
Equity Incentive Plan 2012 [Member] | |||||||||||
Class of Stock [Line Items] | |||||||||||
Options oustanding | 1,826,548 | 1,826,548 | |||||||||
Total common stock reserved for future issuance | 1,980,201 | 1,980,201 | |||||||||
2001 Stock Option Plan [Member] | |||||||||||
Class of Stock [Line Items] | |||||||||||
Options oustanding | 9,287 | 9,287 | |||||||||
Previously Reported [Member] | |||||||||||
Class of Stock [Line Items] | |||||||||||
Common stock, shares outstanding | 33,000,000 | ||||||||||
Securities Purchase Agreement [Member] | |||||||||||
Class of Stock [Line Items] | |||||||||||
Shares issued as bankruptcy settlement | 9,497,515 | ||||||||||
Class Action Suit Related To Former CEO [Member] | |||||||||||
Class of Stock [Line Items] | |||||||||||
Shares reserved for issuance in connection with class action lawsuit | 300,000 | ||||||||||
Litigation accrual expense | $ 1,300,000 | $ 1,300,000 | |||||||||
PIPE Litigation Plaintiffs [Member] | |||||||||||
Class of Stock [Line Items] | |||||||||||
Shares reserved for issuance in connection with class action lawsuit | 327,608 | 327,608 | |||||||||
Litigation accrual expense | $ 1,500,000 | ||||||||||
Financial advisor [Member] | |||||||||||
Class of Stock [Line Items] | |||||||||||
Restricted common stock issued | $ 40,000 | ||||||||||
Restricted common stock issued, value | 120,000 | ||||||||||
Investor relations consultant [Member] | |||||||||||
Class of Stock [Line Items] | |||||||||||
Restricted common stock issued | $ 25,000 | ||||||||||
Restricted common stock issued, value | 77,500 | ||||||||||
Former Director [Member] | |||||||||||
Class of Stock [Line Items] | |||||||||||
Shares reserved for issuance in connection with class action lawsuit | 3,750 | 3,750 | 3,750 | ||||||||
Litigation accrual expense | $ 16,000 | $ 16,000 | |||||||||
Private Placement [Member] | |||||||||||
Class of Stock [Line Items] | |||||||||||
Price per share | $ 24.86 | ||||||||||
Number of shares authorized | 511,596 | ||||||||||
Value of shares authorized | $ 15,000,000 | ||||||||||
Stock issued during period, shares | 326,698 | ||||||||||
Stock issued during period, value | $ 8,200,000 | ||||||||||
Private Placement [Member] | Directors, officers, employees or consultants [Member] | |||||||||||
Class of Stock [Line Items] | |||||||||||
Price per share | $ 29.32 |
Stockholders' Equity (Equity In
Stockholders' Equity (Equity Incentive Plan) (Details) - USD ($) | Sep. 13, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of shares authorized to be issued under the plan | 4,172,229 | ||||
Stock-based compensation expense | $ 844,000 | $ 1,971,000 | |||
Total fair value of options vested | $ 800,000 | $ 2,900,000 | |||
Weighted-average fair value of options granted during the period | $ 2.41 | [1] | $ 2.15 | ||
Weighted-average period | 2 years 6 months | ||||
Unrecognized compensation expense | $ 3,100,000 | ||||
Equity Incentive Plan 2012 [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting period expiration | 10 years | ||||
Additional shares authorized | 3,000,000 | ||||
Shares available for future grant | 1,980,201 | ||||
Number of shares authorized to be issued under the plan | 1,980,201 | ||||
Equity Incentive Plan 2012 [Member] | Maximum [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting period | 4 years | ||||
Common stock available for issuance | 125,000 | 1,100,000 | |||
Equity Incentive Plan 2012 [Member] | Minimum [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting period | 3 years | ||||
Employee Stock Purchase Plan 2012 [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of shares authorized to be issued under the plan | 21,058 | ||||
Fair market value percentage of ordinary shares | 85.00% | ||||
2001 Stock Option Plan [Member] | Maximum [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of shares authorized to be issued under the plan | 426,030 | ||||
[1] | The weighted average price per share is determined using exercise price per share for stock options. |
Stockholders' Equity (Stock Opt
Stockholders' Equity (Stock Option Activity) (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | |||
Number of Shares | ||||
Balance at the beginning of the period (in shares) | 465,401 | 334,686 | ||
Options granted (in shares) | 1,778,022 | 321,020 | ||
Options forfeited (in shares) | (3,416) | (176,764) | ||
Options expired (in shares) | (398,547) | (13,541) | ||
Options exercised (in shares) | (5,625) | |||
Balance at the end of the period (in shares) | 1,835,835 | 465,401 | ||
Options vested and expected to vest at the end of the period (in shares) | 1,829,593 | |||
Options exercisable (in shares) | 287,041 | |||
Weighted-Average Exercise Price (Per Share) | ||||
Balance at the beginning of the period (in dollars per share) | $ 19.29 | $ 34 | ||
Options granted (in dollars per share) | 3.38 | 3.46 | ||
Options forfeited (in dollars per share) | 5.86 | 17.58 | ||
Options expired (in dollars per share) | 18.38 | 24.32 | ||
Options exercised (in dollars per share) | 1.77 | |||
Balance at the ending of the period (in dollars per share) | 4.15 | [1] | 19.29 | |
Options vested and expected to vest at the end of the period (in dollars per share) | [1] | 4.15 | ||
Options exercisable (in dollars per share) | [1] | 8.35 | ||
Weighted-average fair value of options granted during the period | $ 2.41 | [1] | $ 2.15 | |
Weighted-Average Remaining Contractual Term (in years) | ||||
Balance at the end of the period | 9 years 6 months | |||
Options vested and expected to vest at the end of the period | 9 years 6 months | |||
Options exercisable | 8 years 5 months 16 days | |||
Aggregate Intrinsic Value (in thousands) | ||||
Balance at the end of the period | [2] | $ 947,896 | ||
Options vested and expected to vest at the end of the period | [2] | 944,673 | ||
Options exercisable | [2] | $ 133,792 | ||
[1] | The weighted average price per share is determined using exercise price per share for stock options. | |||
[2] | The aggregate intrinsic value is calculated as the difference between the exercise price of the option and the fair value of the Company's common stock for in-the-money options at December 31, 2016. |
Stockholders' Equity (Options O
Stockholders' Equity (Options Outstanding and Exercisable By Price Range) (Details) | 12 Months Ended |
Dec. 31, 2016$ / sharesshares | |
Stock Options Outstanding | |
Number of Shares | shares | 1,835,835 |
Weighted Average Remaining Contractual Life | 9 years 6 months |
Weighted Average Exercise Price (in dollars per share) | $ 4.15 |
Stock Options Exercisable | |
Number of Shares | shares | 287,041 |
Weighted Average Exercise Price Per Share (in dollars per share) | $ 8.35 |
Exercise Price Range From $1.91 To $1.91 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise Price, low end of range (in dollars per share) | 1.91 |
Exercise Price, high end of range (in dollars per share) | $ 1.91 |
Stock Options Outstanding | |
Number of Shares | shares | 8,500 |
Weighted Average Remaining Contractual Life | 8 years 9 months 4 days |
Weighted Average Exercise Price (in dollars per share) | $ 1.91 |
Stock Options Exercisable | |
Number of Shares | shares | 2,479 |
Weighted Average Exercise Price Per Share (in dollars per share) | $ 1.91 |
Exercise Price Range From $2.11 To $3.30 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise Price, low end of range (in dollars per share) | 2.11 |
Exercise Price, high end of range (in dollars per share) | $ 3.30 |
Stock Options Outstanding | |
Number of Shares | shares | 51,800 |
Weighted Average Remaining Contractual Life | 9 years 8 months 27 days |
Weighted Average Exercise Price (in dollars per share) | $ 3.26 |
Stock Options Exercisable | |
Number of Shares | shares | 50,562 |
Weighted Average Exercise Price Per Share (in dollars per share) | $ 3.29 |
Exercise Price Range From $3.38 To $3.38 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise Price, low end of range (in dollars per share) | 3.38 |
Exercise Price, high end of range (in dollars per share) | $ 3.38 |
Stock Options Outstanding | |
Number of Shares | shares | 1,678,022 |
Weighted Average Remaining Contractual Life | 9 years 8 months 16 days |
Weighted Average Exercise Price (in dollars per share) | $ 3.38 |
Stock Options Exercisable | |
Number of Shares | shares | 139,831 |
Weighted Average Exercise Price Per Share (in dollars per share) | $ 3.38 |
Exercise Price Range From $3.40 To $4.72 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise Price, low end of range (in dollars per share) | 3.40 |
Exercise Price, high end of range (in dollars per share) | $ 4.72 |
Stock Options Outstanding | |
Number of Shares | shares | 55,712 |
Weighted Average Remaining Contractual Life | 9 years 7 months 17 days |
Weighted Average Exercise Price (in dollars per share) | $ 3.52 |
Stock Options Exercisable | |
Number of Shares | shares | 52,430 |
Weighted Average Exercise Price Per Share (in dollars per share) | $ 3.45 |
Exercise Price Range From $8.24 To $17.36 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise Price, low end of range (in dollars per share) | 8.24 |
Exercise Price, high end of range (in dollars per share) | $ 17.36 |
Stock Options Outstanding | |
Number of Shares | shares | 9,200 |
Weighted Average Remaining Contractual Life | 1 year 1 month 17 days |
Weighted Average Exercise Price (in dollars per share) | $ 9.78 |
Stock Options Exercisable | |
Number of Shares | shares | 9,200 |
Weighted Average Exercise Price Per Share (in dollars per share) | $ 9.78 |
Exercise Price Range From $42.88 To $48.00 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise Price, low end of range (in dollars per share) | 42.88 |
Exercise Price, high end of range (in dollars per share) | $ 48 |
Stock Options Outstanding | |
Number of Shares | shares | 32,601 |
Weighted Average Remaining Contractual Life | 1 year 29 days |
Weighted Average Exercise Price (in dollars per share) | $ 45.52 |
Stock Options Exercisable | |
Number of Shares | shares | 32,539 |
Weighted Average Exercise Price Per Share (in dollars per share) | $ 45.52 |
Stockholders' Equity (Fair Valu
Stockholders' Equity (Fair Value Assumptions) (Details) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Expected volatility, minimum (as a percent) | 85.00% | 67.00% |
Expected volatility, maximum (as a percent) | 90.00% | 78.00% |
Risk-free interest rate, minimum (as a percent) | 1.30% | 1.50% |
Risk-free interest rate, maximum (as a percent) | 1.40% | 1.80% |
Expected dividend yield (as a percent) | 0.00% | 0.00% |
Minimum [Member] | ||
Expected term | 5 years | 5 years |
Maximum [Member] | ||
Expected term | 6 years | 6 years |
Stockholders' Equity (Stock-Bas
Stockholders' Equity (Stock-Based Compensation Expense Recognized) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Stock-based compensation expense | $ 844 | $ 1,971 |
General And Administrative Expense [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Stock-based compensation expense | 547 | 1,134 |
Research And Development Expense [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Stock-based compensation expense | $ 297 | $ 837 |
Restructuring Charges (Narrativ
Restructuring Charges (Narrative) (Details) - USD ($) | 1 Months Ended | 12 Months Ended | |
Nov. 30, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | |
Restructuring Cost and Reserve [Line Items] | |||
Reduction in workforce (as a percentage) | 20.00% | ||
Value of stock options fair value modification | $ 959,000 | ||
Modification of stock options related to restructuring activities | 480,000 | ||
General And Administrative Expense [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Modification of stock options related to restructuring activities | 542,000 | ||
Research And Development Expense [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Modification of stock options related to restructuring activities | $ 417,000 | ||
Loan And Security Agreement [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Repayments of debt | $ 6,600,000 |
Restructuring Charges (Summary
Restructuring Charges (Summary of Activity) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Restructuring Cost and Reserve [Line Items] | ||
Balance at the beginning of the period | $ 11 | $ 1,185 |
Accrued | 2,178 | |
Adjustments | (11) | (78) |
Paid | (3,274) | |
Balance at the end of the period | 11 | |
Reduction in workforce (as a percentage) | 20.00% | |
Research And Development Expense [Member] | Contract Termination [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Balance at the beginning of the period | 1,185 | |
Accrued | ||
Adjustments | (78) | |
Paid | (1,107) | |
Balance at the end of the period | ||
Research And Development Expense [Member] | Employee Severance [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Balance at the beginning of the period | ||
Accrued | 1,167 | |
Adjustments | ||
Paid | (1,167) | |
Balance at the end of the period | ||
General And Administrative Expense [Member] | Employee Severance [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Balance at the beginning of the period | 11 | |
Accrued | 1,011 | |
Adjustments | (11) | |
Paid | (1,000) | |
Balance at the end of the period | $ 11 |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Increase (decrease) in valuation allowance | $ 10.5 | $ 12.3 |
Internal Revenue Service I R S [Member] | ||
Net operating loss carryforwards | 146.8 | |
Internal Revenue Service I R S [Member] | Research [Member] | ||
Tax credit carryforwards | $ 1.5 | |
Internal Revenue Service I R S [Member] | Minimum [Member] | ||
Expiration year | Dec. 31, 2021 | |
Internal Revenue Service I R S [Member] | Minimum [Member] | Research [Member] | ||
Expiration year | Dec. 31, 2022 | |
Internal Revenue Service I R S [Member] | Maximum [Member] | ||
Expiration year | Dec. 31, 2036 | |
Internal Revenue Service I R S [Member] | Maximum [Member] | Research [Member] | ||
Expiration year | Dec. 31, 2036 | |
State And Local Jurisdiction [Member] | ||
Net operating loss carryforwards | $ 137 | |
State And Local Jurisdiction [Member] | Research [Member] | ||
Tax credit carryforwards | $ 2.3 | |
State And Local Jurisdiction [Member] | Minimum [Member] | ||
Expiration year | Dec. 31, 2017 | |
State And Local Jurisdiction [Member] | Maximum [Member] | ||
Expiration year | Dec. 31, 2036 |
Income Taxes (Significant Compo
Income Taxes (Significant Components of Deferred Tax Assets) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Deferred tax assets: | ||
Net operating losses | $ 57,903 | $ 49,145 |
Research & other credits | 2,121 | 1,978 |
Stock based compensation | 2,164 | 1,047 |
In-Process R&D | 1,246 | |
Accrued bankruptcy settlement | 1,328 | |
Other | 761 | 222 |
Total deferred tax assets | 64,195 | 53,720 |
Valuation allowance | (64,195) | (53,720) |
Net deferred tax assets | ||
Domestic Country [Member] | ||
Deferred tax assets: | ||
Income Tax Expense (Benefit) | $ 0 | $ 0 |
Income Taxes (Reconciliation of
Income Taxes (Reconciliation of the Statutory Tax Rates and Effective Tax Rates) (Details) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Reconciliation of the statutory tax rates and the effective tax rates | ||
Statutory rate | 34.00% | 34.00% |
Valuation allowance | (34.80%) | (31.10%) |
Nondeductible stock compensation | (0.10%) | (2.90%) |
Other | 0.90% | |
Effective tax rate |
Income Taxes (Reconciliation 57
Income Taxes (Reconciliation of Beginning and Ending Amount of Unrecognized Tax Benefits) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Reconciliation of the beginning and ending amount of unrecognized tax benefits | ||
Balance at the beginning of the period | $ 1,068 | $ 856 |
Additions based on tax positions related to prior year | (9) | |
Additions based on tax positions related to current year | 68 | 212 |
Balance at the end of the period | 1,127 | $ 1,068 |
Interest or penalties related to unrecognized tax benefits | $ 0 |
Employee Benefit Plan (Details)
Employee Benefit Plan (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2016USD ($) | |
Compensation and Retirement Disclosure [Abstract] | |
Employer contributions | $ 0 |
Litigation (Details)
Litigation (Details) - USD ($) | May 09, 2016 | Jun. 15, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Jun. 30, 2016 |
Obligation to issue common stock in settlement of litigation | $ 2,835,000 | ||||
Liabilities subject to compromise | $ 5,414,000 | ||||
Class Action Lawsuit Alleging Violations Of Securities Laws By Former CEO [Member] | |||||
Damages sought in class-action suit | $ 20,000,000 | ||||
Shares reserved for issuance in connection with class action lawsuit | 300,000 | ||||
Settlement amount awarded | $ 250,000 | $ 250,000 | |||
Settlement shares awarded | $ 300,000 | ||||
Advance insurance proceeds awarded | 1,250,000 | ||||
PIPE Litigation Plaintiffs [Member] | |||||
Damages sought in class-action suit | 6,900,000 | ||||
Shares reserved for issuance in connection with class action lawsuit | 327,608 | 327,608 | |||
Settlement amount awarded | $ 250,000 | 250,000 | |||
Settlement shares awarded | $ 327,608 | 327,608 | |||
Settled Litigation [Member] | |||||
Obligation to issue common stock in settlement of litigation | 2,835,000 | ||||
Liabilities subject to compromise | 500,000 | ||||
Marek Biestek [Member] | |||||
Settlement shares awarded | $ 3,750 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) | Dec. 03, 2015 | Dec. 31, 2016 | May 24, 2016 | Dec. 31, 2016 | Dec. 31, 2015 |
Hourly rate for professional services | $ 152 | ||||
Price per share | $ 29.32 | ||||
Stock issued during period, value | $ 643,200 | $ 10,132,000 | $ 8,218,000 | ||
Stock issued during period, shares | 21,936 | ||||
Certain Lenders [Member] | |||||
Number of shares issued in settlement of debt | 2,115,432 | ||||
Net Expense [Member] | |||||
Stock issued during period, value | $ 700,000 | $ 700,000 | |||
General And Administrative Expense [Member] | |||||
Stock issued during period, value | 751,000 | ||||
Equity Award [Member] | |||||
Stock issued during period, value | $ 1,451,000 | $ 1,451,000 | |||
Stock issued during period, shares | 323,155 | 323,155 |