Cover
Cover - shares | 9 Months Ended | |
Sep. 30, 2022 | Nov. 08, 2022 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Sep. 30, 2022 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2022 | |
Current Fiscal Year End Date | --12-31 | |
Entity File Number | 001-41173 | |
Entity Registrant Name | NexGel, Inc. | |
Entity Central Index Key | 0001468929 | |
Entity Tax Identification Number | 26-4042544 | |
Entity Incorporation, State or Country Code | DE | |
Entity Address, Address Line One | 2150 Cabot Blvd West | |
Entity Address, Address Line Two | Suite B | |
Entity Address, City or Town | Langhorne | |
Entity Address, State or Province | PA | |
Entity Address, Postal Zip Code | 19047 | |
City Area Code | (215) | |
Local Phone Number | 702-8550 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Elected Not To Use the Extended Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 5,572,234 | |
Common Stock Par Value 0.001 [Member] | ||
Title of 12(b) Security | Common Stock, par value $0.001 | |
Trading Symbol | NXGL | |
Security Exchange Name | NASDAQ | |
Warrants To Purchase Common Stock [Member] | ||
Title of 12(b) Security | Warrants to Purchase Common Stock | |
Trading Symbol | NXGLW | |
Security Exchange Name | NASDAQ |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Current Assets: | ||
Cash and cash equivalents | $ 1,427 | $ 13,350 |
Marketable securities | 5,985 | |
Accounts receivable, net | 265 | 209 |
Inventory | 399 | 291 |
Prepaid expenses and other current assets | 239 | 77 |
Total current assets | 8,315 | 13,927 |
Goodwill | 311 | 311 |
Intangibles, net | 23 | 33 |
Property and equipment, net | 737 | 723 |
Operating lease - right of use asset | 1,785 | 1,926 |
Other assets | 63 | 63 |
Total assets | 11,234 | 16,983 |
Current Liabilities: | ||
Accounts payable | 358 | 254 |
Accrued expenses and other current liabilities | 164 | 62 |
Convertible notes payable | 2,037 | |
Notes payable, current portion | 14 | 10 |
Warrant liability | 372 | 318 |
Operating lease liability, current portion | 207 | 207 |
Total current liabilities | 1,115 | 2,888 |
Long-Term Liabilities: | ||
Operating lease liability, net of current portion | 1,632 | 1,744 |
Notes payable, net of current portion | 269 | 266 |
Total long-term liabilities | 1,901 | 2,010 |
Total liabilities | 3,016 | 4,898 |
Commitments and Contingencies (Note 14) | ||
Preferred Stock, par value $0.001 per share, 5,000,000 shares authorized, no shares issued and outstanding | ||
Common Stock, par value $0.001 per share, 25,000,000 shares authorized; 5,572,234 shares issued and outstanding as of both September 30, 2022 and December 31, 2021 | 6 | 6 |
Additional paid-in capital | 19,122 | 18,891 |
Accumulated deficit | (10,910) | (6,812) |
Total stockholders’ equity | 8,218 | 12,085 |
Total liabilities and stockholders’ equity | $ 11,234 | $ 16,983 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Sep. 30, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 25,000,000 | 25,000,000 |
Common stock, shares issued | 5,572,234 | 5,572,234 |
Common stock, shares, outstanding | 5,572,234 | 5,572,234 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Income Statement [Abstract] | ||||
Revenues, net | $ 568 | $ 335 | $ 1,524 | $ 1,018 |
Cost of revenues | 420 | 392 | 1,304 | 1,113 |
Gross (loss)/profit | 148 | (57) | 220 | (95) |
Operating expenses | ||||
Research and development | 193 | 328 | 17 | |
Selling, general and administrative | 992 | 553 | 2,459 | 1,571 |
Total operating expenses | 1,185 | 553 | 2,787 | 1,588 |
Loss from operations | (1,037) | (610) | (2,567) | (1,683) |
Other expense, net | ||||
Interest expense | (242) | (534) | (1,334) | (1,052) |
Loss on debt extinguishment | (150) | (25) | ||
Warrant modification expense | (57) | (57) | ||
Debt discount costs | (68) | |||
Other income | 2 | 147 | ||
Gain on investments in marketable securities | 5 | 5 | ||
Changes in fair value of warrant liability | 104 | 2 | 3 | 10 |
Total other expense, net | (190) | (532) | (1,531) | (988) |
Loss before income taxes | (1,227) | (1,142) | (4,098) | (2,671) |
Income tax expense | ||||
Net loss | $ (1,227) | $ (1,142) | $ (4,098) | $ (2,671) |
Net loss per common share - basic | $ (0.22) | $ (0.38) | $ (0.74) | $ (0.91) |
Net loss per common share - diluted | $ (0.22) | $ (0.38) | $ (0.74) | $ (0.91) |
Weighted average shares used in computing net loss per common share - basic | 5,572,234 | 2,979,371 | 5,572,234 | 2,942,057 |
Weighted average shares used in computing net loss per common share – diluted | 5,572,234 | 2,979,371 | 5,572,234 | 2,942,057 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) $ in Thousands | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | Total |
Beginning balance, value at Dec. 31, 2020 | $ 3 | $ 2,570 | $ (2,502) | $ 71 |
Beginning balance, shares at Dec. 31, 2020 | 2,838,047 | |||
Stock-based compensation | 69 | 69 | ||
Net loss | (704) | (704) | ||
Restricted stock vesting | 21 | 21 | ||
Issuances of common stock, net of issuance costs | 285 | 285 | ||
Issuances of common stock, net of issuance costs, shares | 101,800 | |||
Warrants issued for debt issuance | (18) | (18) | ||
Beneficial conversion and warrant features of convertible debt | 1,276 | 1,276 | ||
Ending balance, value at Mar. 31, 2021 | $ 3 | 4,203 | (3,206) | 1,000 |
Ending balance, shares at Mar. 31, 2021 | 2,939,847 | |||
Beginning balance, value at Dec. 31, 2020 | $ 3 | 2,570 | (2,502) | 71 |
Beginning balance, shares at Dec. 31, 2020 | 2,838,047 | |||
Net loss | (2,671) | |||
Ending balance, value at Sep. 30, 2021 | $ 3 | 5,654 | (5,173) | 484 |
Ending balance, shares at Sep. 30, 2021 | 2,979,371 | |||
Beginning balance, value at Mar. 31, 2021 | $ 3 | 4,203 | (3,206) | 1,000 |
Beginning balance, shares at Mar. 31, 2021 | 2,939,847 | |||
Stock-based compensation | 74 | 74 | ||
Net loss | (825) | (825) | ||
Restricted stock vesting | 21 | 21 | ||
Restricted stock vesting, shares | 39,524 | |||
Ending balance, value at Jun. 30, 2021 | $ 3 | 4,298 | (4,031) | 270 |
Ending balance, shares at Jun. 30, 2021 | 2,979,371 | |||
Stock-based compensation | 24 | 24 | ||
Net loss | (1,142) | (1,142) | ||
Restricted stock vesting | 21 | 21 | ||
Beneficial conversion and warrant features of convertible debt | 1,311 | 1,311 | ||
Ending balance, value at Sep. 30, 2021 | $ 3 | 5,654 | (5,173) | 484 |
Ending balance, shares at Sep. 30, 2021 | 2,979,371 | |||
Beginning balance, value at Dec. 31, 2021 | $ 6 | 18,891 | (6,812) | 12,085 |
Beginning balance, shares at Dec. 31, 2021 | 5,572,234 | |||
Stock-based compensation | 55 | 55 | ||
Net loss | (1,836) | (1,836) | ||
Ending balance, value at Mar. 31, 2022 | $ 6 | 18,946 | (8,648) | 10,304 |
Ending balance, shares at Mar. 31, 2022 | 5,572,234 | |||
Beginning balance, value at Dec. 31, 2021 | $ 6 | 18,891 | (6,812) | 12,085 |
Beginning balance, shares at Dec. 31, 2021 | 5,572,234 | |||
Net loss | (4,098) | |||
Ending balance, value at Sep. 30, 2022 | $ 6 | 19,122 | (10,910) | 8,218 |
Ending balance, shares at Sep. 30, 2022 | 5,572,234 | |||
Beginning balance, value at Mar. 31, 2022 | $ 6 | 18,946 | (8,648) | 10,304 |
Beginning balance, shares at Mar. 31, 2022 | 5,572,234 | |||
Stock-based compensation | 54 | 54 | ||
Net loss | (1,035) | (1,035) | ||
Restricted stock vesting | 25 | 25 | ||
Ending balance, value at Jun. 30, 2022 | $ 6 | 19,025 | (9,683) | 9,348 |
Ending balance, shares at Jun. 30, 2022 | 5,572,234 | |||
Stock-based compensation | 55 | 55 | ||
Net loss | (1,227) | (1,227) | ||
Restricted stock vesting | 42 | 42 | ||
Ending balance, value at Sep. 30, 2022 | $ 6 | $ 19,122 | $ (10,910) | $ 8,218 |
Ending balance, shares at Sep. 30, 2022 | 5,572,234 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Operating Activities | ||
Net loss | $ (4,098) | $ (2,671) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 84 | 206 |
Changes in ROU asset and operating lease liability | 29 | 16 |
Share-based compensation | 231 | 229 |
Changes in fair value of warrant liability | (3) | (10) |
Amortization of deferred financing costs | 1,325 | 1,058 |
Warrant modification expense | 57 | |
Loss on extinguishment of debt | 150 | 25 |
Gain on investments in marketable securities | (5) | |
Forgiveness of debt | (147) | |
Beneficial conversion feature in excess of face value | 52 | |
Changes in operating assets and liabilities: | ||
Accounts receivable | (56) | (121) |
Inventory | (108) | (28) |
Prepaid expenses and other current assets | (162) | 39 |
Accounts payable | 104 | (145) |
Accrued expenses and other current liabilities | 109 | (21) |
Deferred revenue | (38) | |
Net Cash Used in Operating Activities | (2,343) | (1,556) |
Investing Activities | ||
Investment in marketable securities | (6,980) | |
Proceeds from sale of marketable securities | 1,000 | |
Capital expenditures | (88) | (390) |
Net Cash Used in Investing Activities | (6,068) | (390) |
Financing Activities | ||
Issuance of common stock, net of issuance costs | 285 | |
Proceeds from notes payable | 15 | |
Principal payment of notes payable | (3,512) | |
Proceeds from notes payable (PPP) | 127 | |
Proceeds from convertible notes | 2,957 | |
Payment of financing costs | (115) | |
Principal payment on convertible notes | (100) | |
Net Cash Provided by (Used In) Financing Activities | (3,512) | 3,169 |
Net Increase (Decrease) in Cash and Cash Equivalents | (11,923) | 1,223 |
Cash and Cash Equivalents – Beginning of period | 13,350 | 32 |
Cash and Cash Equivalents – End of period | 1,427 | 1,255 |
Cash paid during the year for: | ||
Interest | ||
Taxes | ||
Supplemental Non-cash Investing and Financing Activities | ||
Fair value of beneficial conversion and warrant features of convertible notes payable | 2,587 | |
Original issue discounts recognized on convertible notes payable | 653 | |
Warrants issued for debt and equity financing costs | 203 | |
Operating lease, ROU assets and liabilities | $ 2,050 |
Description of Business, the Sp
Description of Business, the Spin-off and Basis of Presentation | 9 Months Ended |
Sep. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business, the Spin-off and Basis of Presentation | 1. Description of Business, the Spin-off and Basis of Presentation Description of Business NexGel, Inc. (“NexGel” or the “Company”) manufactures high water content, electron beam cross-linked, aqueous polymer hydrogels, or gels, used for wound care, medical diagnostics, transdermal drug delivery and cosmetics. The Company specializes in custom gels by capitalizing on proprietary manufacturing technologies. NexGel has historically served as a contract manufacturer, supplying our gels to third parties who incorporate them into their own products, and have recently began producing the Company’s own consumer products using our gels focused on proprietary branded products and white label opportunities. Both the Company’s gels and consumer products are manufactured using proprietary and non-proprietary mixing, coating and cross-linking technologies. Together, these technologies enable NexGel to produce gels that can satisfy rigid tolerance specifications with respect to a wide range of physical characteristics (e.g., thickness, water content, adherence, absorption, moisture vapor transmission rate (a measure of the passage of water vapor through a substance) and release rate) while maintaining product integrity. Additionally, the Company has the manufacturing capability to offer broad choices in the selection of liners onto which the gels are coated. Consequently, NexGel and our customers are able to determine tolerances in moisture vapor transmission rate and active ingredient release rates while personalizing color and texture. NexGel was previously known as AquaMed Technologies, Inc. (“AquaMed”) before changing its name to NexGel, Inc. on November 14, 2019. The condensed consolidated financial statements include the accounts of the Company and its consolidated wholly-owned subsidiary, NexGelRx, Inc. Stock Split On November 29, 2021, the Company effected a 1-for-35 reverse stock split Except as otherwise provided herein, all share and per-share amounts of our common stock, equity awards and warrants, including the shares of common stock and warrants being offered hereby, have been adjusted to give effect to the Reverse Stock Split for all periods presented. The Reverse Stock Split did not alter the par value of the Company’s common stock, which remains at $ 0.001 Basis of Presentation The accompanying interim unaudited condensed financial statements and footnotes of NexGel have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) for interim financial information and the instructions to Rule 10-01 of Regulation S-X of the Securities and Exchange Commission (the “SEC”). Accordingly, they do not not . |
Going Concern
Going Concern | 9 Months Ended |
Sep. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Going Concern | 2. Going Concern As of September 30, 2022, the Company had a cash balance of $ 1.4 6.0 4.1 2.3 7.2 On December 27, 2021, the Company sold an aggregate of 2,585,000 5.50 0.001 5.50 14.2 Proceeds from the Offering are expected to be used for working capital, new product development and testing, and general business operations. Management is exploring new product channel sales in adjacent industries, such as cosmetics, athletic products, and proprietary medical devices. The Company has increased focused on sales and developing a sales pipeline for potential customers. This customer base expansion will enable us to provide financial stability for the foreseeable future, expand our current processes, and position us for long-term shareholder value creation. We have sufficient capital to maintain as a going concern due to the capital raise that occurred on December 27, 2021. We intend to maintain and attempt to grow our existing contract manufacturing business. We also plan to continue building and developing our catalog of consumer products for sale to branding partners and to use our in-house capabilities to create and test market additional branded products. These products will be target marketed and sold online through social media, television and online marketplaces. Furthermore, the Company plans to develop its own proprietary medical devices and explore drug delivery programs for its technology. Additionally, the Company continues to evaluate strategic initiatives (e.g., acquisitions) and additional capital raises through debt or equity may be necessary to achieve these objectives. We expect to continue incurring losses for the near-term future. Our ability to continue to operate as a going concern in the long-term is dependent upon our ability to manage and grow our current products and to ultimately achieve profitable operations. Management may consider various options to raise capital to fund potential acquisitions through equity or debt offerings. There can be no assurances, however, that management will be able to obtain sufficient additional funds, if needed, or that such funds, if available, will be obtained on terms satisfactory to us. The consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded assets and liabilities that might be necessary should we be unable to continue as a going concern. Additionally, it is reasonably possible that estimates made in the consolidated financial statements have been, or will be, materially and adversely impacted in the near term as a result of these conditions, including the recoverability of long-lived assets. |
Significant Accounting Policies
Significant Accounting Policies and Estimates | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies and Estimates | 3. Significant Accounting Policies and Estimates Use of Estimates The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. These estimates and assumptions include an allowances for doubtful accounts, inventory reserves, deferred taxes, share-based compensation and related valuation allowances and fair value of long-lived assets. Actual results could differ from the estimates. Reclassifications We have reclassified, combined or separately disclosed certain amounts in the prior years’ condensed consolidated financial statements and accompanying footnotes to conform with the current period’s presentation. Cash and Cash Equivalents Cash and cash equivalents is comprised of cash in banks and highly liquid investments, including U.S. treasury bills purchased with an original maturity of three months or less. Cash equivalents consist of investments in money market funds for which the carrying amount approximates fair value, due to the short maturities of these investments. Marketable Securities The Company classifies its marketable securities as held-to-maturity, which include U.S. treasury bills with original maturities of greater than three months. These securities are carried at cost. The total unrecognized gain related to the marketable securities was inconsequential during the nine months ended September 30, 2022. Schedule of Marketable Securities September 30, 2022 Marketable Securities United States treasury bills (due December 29, 2022) $ 494 United States treasury bills (due February 23, 2023) 492 United States treasury bills (due June 15, 2023) 4,387 United States treasury bills (due July 13, 2023) 127 United States treasury bills (due August 10, 2023) 485 Total $ 5,985 Accounts Receivable, net Trade accounts receivable are stated at the amount the Company expects to collect and do not bear interest. The Company evaluates the collectability of accounts receivable and records a provision to the allowance for doubtful accounts based on factors including the length of time the receivables are past due, the current business environment and the Company’s historical experience. Provisions to the allowances for doubtful accounts are recorded in selling, general and administrative expenses. Account balances are charged off against the allowance when it is probable that the receivable will not be recovered. The allowance for doubtful accounts was $ 10 4 Inventory and Cost of Revenues Inventory is stated at the lower of cost, the value determined by the first-in, first-out method, or net realizable value. The Company evaluates inventories for excess quantities, obsolescence, and shelf-life expiration. This evaluation includes an analysis of historical sales levels by product, projections of future demand, the risk of technological or competitive obsolescence for products, general market conditions, and a review of the shelf-life expiration dates for products. These factors determine when, and if, the Company adjusts the carrying value of inventory to estimated net realizable value. The balance is made up of raw materials, work-in-progress, and finished goods of $ 285 87 27 266 0 25 The Company produces proprietary branded products and white label opportunities in our manufacturing of consumer products. In our contract manufacturing, the Company builds its products based on customer orders and immediately ships the products upon completion of the production process. The “Cost of Revenues” line item in the consolidated statements of operations is comprised of the book value of inventory sold to customers during the reporting period. When circumstances dictate that we use net realizable value as the basis for recording inventory, we base our estimates on expected future selling prices less expected disposal costs. Research and Development Our research and development activities focus on new and innovative products designed to support revenue growth. Research and development expenses consist primarily of contracted development and testing efforts associated with development of products. Shipping and Handling Revenue and Expense Shipping and handling revenue and expense are included in our consolidated statements of operations in Revenue and Cost of revenues, respectively. This is primarily through shipping fees incurred in the Amazon marketplace. Property and Equipment, net Property and equipment is recorded at historical cost, net of accumulated depreciation and amortization. Depreciation is provided over the assets’ useful lives on a straight-line basis. Leasehold improvements are amortized on a straight-line basis over the shorter of their estimated useful lives or lease terms. Repairs and maintenance costs are expensed as incurred. Management periodically assesses the estimated useful life over which assets are depreciated or amortized. If the analysis warrants a change in the estimated useful life of property and equipment, management will reduce the estimated useful life and depreciate or amortize the carrying value prospectively over the shorter remaining useful life. The carrying amounts of assets sold or retired and the related accumulated depreciation are eliminated in the period of disposal and the resulting gains and losses are included in the results of operations during the same period. Goodwill and Intangible Assets In applying the acquisition method of accounting, amounts assigned to identifiable assets and liabilities acquired were based on estimated fair values as of the date of acquisition, with the remainder recorded as goodwill. Identifiable intangible assets are initially recorded at fair value using generally accepted valuation methods appropriate for the type of intangible asset. Identifiable intangible assets with definite lives are amortized over their estimated useful lives and are reviewed for impairment if indicators of impairment arise. Intangible assets with indefinite lives are tested for impairment within one year of acquisitions or annually as of December 31, and whenever indicators of impairment exist. The fair value of intangible assets are compared with their carrying values, and an impairment loss would be recognized for the amount by which a carrying amount exceeds its fair value. The Company performed the annual assessment and concluded it is more likely than not that the fair value exceeds the carrying value. Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets is recorded at historical cost and is primarily made up of $ 98 23 141 54 Other Assets Other assets is recorded at historical costs, and as of September 30, 2022 and December 31, 2021, the balance is primarily made up of spare parts for manufacturing equipment. Spare parts are stated at cost and are not subject to depreciation, until such time that they are placed into service and the part that is being replaced is disposed. Fair Value Measurements The Company utilizes the fair value hierarchy to apply fair value measurements. The fair value hierarchy is based on inputs to valuation techniques that are used to measure fair values that are either observable or unobservable. Observable inputs reflect assumptions market participants would use in pricing an asset or liability based on market data obtained from independent sources, while unobservable inputs reflect a reporting entity’s pricing based upon its own market assumptions. The basis for fair value measurements for each level within the hierarchy is described below: Level 1 Level 2 Level 3 The Company considers the carrying amounts of its financial instruments (cash, accounts receivable and accounts payable, notes payable and convertible notes payable) in the balance sheet to approximate fair value because of the short-term or highly liquid nature of these financial instruments. The following table sets forth the fair value of the Company’s financial assets within the fair value hierarchy: Schedule of Fair Value of Financial Assets Level 1 Level 2 Level 3 Fair Value September 30, 2022 Level 1 Level 2 Level 3 Fair Value Assets Marketable securities: United States treasury bills $ 5,985 $ — $ — $ 5,985 Total $ 5,985 $ — $ — $ 5,985 Warrant Liability Warrants to purchase common stock were issued in connection with equity financing raises, which occurred on September 2, 2021, March 11, 2021, February 3, 2021, December 24, 2020, March 18, 2020, September 10, 2019 and November 6, 2019. The fair values of the warrants are estimated as of the date of issuance and again at each period end using a Black-Scholes option valuation model. At issuance, the fair values of the warrants are recognized as an equity issuance cost within additional paid-in-capital. Fair value adjustments to the warrant liability are recognized in other income (expense) in the statements of operations. Revenue Recognition On January 1, 2018, the Company adopted Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers The Company currently recognizes revenue predominately from three types of revenue, contract manufacturing, custom and white label finished goods manufacturing and our branded products. Revenues from manufactured products are recognized at the point where the customer obtains control of the goods and the Company satisfies its performance obligation, which generally is at the time the customer receives the product. The Company’s customers consist of other life sciences companies and Amazon retail customers. Revenues are entirely concentrated in the United States. Payment terms vary by the type and location of customer and may differ by jurisdiction and customer but payment is generally required in a term ranging from 30 to 60 days from date of shipment. Estimates for product returns, allowances and discounts are recorded as a reduction of revenue and are established at the time of sale. Returns are estimated through a comparison of historical return data and are determined for each product and adjusted for known or expected changes in the marketplace specific to each product, when appropriate. Historically, sales return provisions have not been material. Amounts accrued for sales allowances and discounts are based on estimates of amounts that are expected to be claimed on the related sales and are based on historical data. Payments for allowances and discounts have historically been immaterial. Disaggregated revenue by sales type: Schedule of Disaggregated Revenue by Sales Type 2022 2021 Three months ending September 30, 2022 2021 Contract manufacturing $ 277 $ 180 Custom and white label finished goods manufacturing 15 - NexGel branded consumer products 231 155 Other 45 - Total $ 568 $ 335 2022 2021 Nine months ending September 30, 2022 2021 Contract manufacturing $ 736 $ 559 Custom and white label finished goods manufacturing 34 194 NexGel branded consumer products 623 265 Other 131 — Total $ 1,524 $ 1,018 As of September 30, 2022 and December 31, 2021, the Company did not have any contract assets or contract liabilities from contracts with customers. As of September 30, 2022 and December 31, 2021, there were no Share-based Compensation On August 28, 2019, the Company adopted the 2019 Long-Term Incentive Plan, as amended (the “2019 Plan”). See Note 10 below for further details regarding the 2019 Plan. The 2019 Plan provides certain employees, contractors, and outside directors with share-based compensation in the form of incentive stock options, nonqualified stock options, stock appreciation rights, restricted stock, restricted stock units, performance awards, dividend equivalent rights and other awards. The fair values of incentive stock option award grants are estimated as of the date of grant using a Black-Scholes option valuation model. Compensation expense is recognized in the statements of operations on a straight-line basis over the requisite service period, which is generally the vesting period required to obtain full vesting. Forfeitures are accounted for when they occur. In June 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2018-07, Compensation - Stock Compensation (Topic 718) - Improvements to Nonemployee Share-Based Payment Accounting Compensation - Stock Compensation Income Taxes Income taxes are accounted for using an asset and liability approach that requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the financial statement and tax bases of assets and liabilities at the applicable tax rates. Deferred tax assets are reduced by a valuation allowance when it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates. Recently Issued Accounting Standards From time to time, new accounting pronouncements are issued by the FASB or other standard setting bodies and adopted by us as of the specified effective date. Unless otherwise discussed, the impact of recently issued standards that are not yet effective will not have a material impact on our financial position or results of operations upon adoption. In June 2016, the FASB issued Accounting Standards Update (“ASU”) 2016-13, Financial Instruments - Credit Losses Measurement of Credit Losses on Financial Instruments In January 2017, the FASB issued ASU 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes |
Leases
Leases | 9 Months Ended |
Sep. 30, 2022 | |
Leases | |
Leases | 4. Leases The Company has one operating lease for a commercial manufacturing facility and administrative offices located in Langhorne, Pennsylvania that runs through January 2031. The following table presents information about the amount and timing of the liability arising from the Company’s operating lease as of September 30, 2022 ($ in thousands): Schedule of Future Minimum Lease Payments Operating Lease Maturity of Lease Liability Liability 2022 $ 52 2023 207 2024 207 2025 207 2026 263 Thereafter 1,165 Total undiscounted operating lease payments $ 2,101 Less: Imputed interest (262 ) Present value of operating lease liability $ 1,839 Weighted average remaining lease term 8.25 Weighted average discount rate 3.0 % Total operating lease expense for the nine months ending September 30, 2022 and 2021 was $ 155 192 Supplemental cash flows information related to leases was as follows ($ in thousands): Schedule of Supplemental Cash Flows Information Related to Leases September 30, 2022 Cash paid for amounts included in the measurement of lease liability: Operating cash flows from operating lease $ 155 |
Inventory
Inventory | 9 Months Ended |
Sep. 30, 2022 | |
Inventory Disclosure [Abstract] | |
Inventory | 5. Inventory Inventory consists of the following ($ in thousands): Schedule of Inventory September 30, December 31, 2022 2021 Raw materials $ 285 $ 266 Work-in-progress 87 - Finished goods 27 25 Inventory, gross 399 291 Less: Inventory reserve for excess and slow moving inventory — — Total $ 399 $ 291 Inventory is maintained at the Company’s warehouse and at an Amazon fulfillment center. The Company builds its contract manufacturing products based on customer orders and immediately ships the products upon completion of the production process. |
Property and Equipment, Net
Property and Equipment, Net | 9 Months Ended |
Sep. 30, 2022 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, Net | 6. Property and Equipment, Net Property and equipment consist of the following ($ in thousands): Schedule of Property and Equipment Useful Life September 30, December 31, (Years) 2022 2021 Machinery and equipment 3 10 $ 972 $ 940 Office furniture and equipment 3 10 59 50 Leasehold improvements 6 228 228 Construction in progress - 48 - Property and equipment, gross 1,307 1,218 Less: accumulated depreciation and amortization (570 ) (495 ) Property and equipment, net $ 737 $ 723 Depreciation expense for the nine months ended September 30, 2022 and 2021 was $ 74 75 |
Intangible Assets
Intangible Assets | 9 Months Ended |
Sep. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | 7. Intangible Assets The following provides a breakdown of identifiable intangible assets as of September 30, 2022 and December 31, 2021 ($ in thousands): Schedule of Breakdown of Identifiable Intangible Assets September 30, December 31, 2022 2021 Product/Technology Related Identifiable intangible assets, gross $ 31 $ 31 Accumulated amortization (24 ) (16 ) Product/Technology related identifiable intangible assets, net 7 15 Marketing Related Customer related intangible asset, gross 17 17 Tradename related intangible asset, gross 7 7 Accumulated amortization (8 ) (6 ) Marketing related identifiable intangible assets, net 16 18 Total identifiable intangible assets, net $ 23 $ 33 In connection with the acquisition of Sport Defense in 2020, the Company identified intangible assets of $ 55 3.7 10 As of September 30, 2022, the estimated annual amortization expense for each of the next five fiscal years is as follows ($ in thousands): Schedule of Estimated Annual Amortization Expense 2022 (reminder of the year) $ 4 2023 8 2024 2 2025 2 2026 2 Thereafter 5 Total $ 23 |
Accrued Expenses and Other Curr
Accrued Expenses and Other Current Liabilities | 9 Months Ended |
Sep. 30, 2022 | |
Payables and Accruals [Abstract] | |
Accrued Expenses and Other Current Liabilities | 8. Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consist of the following ($ in thousands): Schedule of Accrued Expenses and Other Current Liabilities September 30, December 31, 2022 2021 Salaries, benefits, and incentive compensation $ 48 $ 54 Franchise tax accrual 107 - Other 9 8 Total accrued expenses and other current liabilities $ 164 $ 62 |
Common Stock
Common Stock | 9 Months Ended |
Sep. 30, 2022 | |
Equity [Abstract] | |
Common Stock | 9. Common Stock Share issuances In connection with the Offering on December 27, 2021, the Company sold an aggregate of 2,585,000 5.50 5.50 . 45 387,750 387,750 387,750 From January 1, 2021 through March 31, 2021, the Company entered into Securities Purchase Agreements with certain accredited investors whereby we sold 101,800 2.80 285 At September 30, 2022, the Company has reserved common stock for issuance in relation to the following: Schedule of Reserved Common Stock For Issuance in Relation Share-based compensation plan 329,937 Warrants to purchase common stock 3,637,190 |
Share-based Compensation
Share-based Compensation | 9 Months Ended |
Sep. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Share-based Compensation | 10. Share-based Compensation The 2019 Plan provides for the granting of incentive stock options, nonqualified stock options, restricted stock, stock appreciation rights (“SARs”), restricted stock units, performance awards, dividend equivalent rights and other awards, which may be granted singly, in combination, or in tandem, and which may be paid in cash, shares of common stock of the Company or a combination of cash and shares of common stock of the Company. The Company initially reserved a total of 57,143 57,143 485,715 485,715 571,429 14,286 Incentive stock options The following table contains information about the 2019 Plan as of September 30, 2022: Schedule of Information about Incentive Plan Awards Awards Reserved for Awards Awards Available for Issuance Issued Exercised Grant 2019 Plan 571,429 329,937 7,183 234,309 The following table summarizes the Company’s incentive stock option activity and related information for the period ended September 30, 2022: Schedule of Incentive Stock Option Activity Weighted Weighted Average Average Contractual Number of Exercise Term in Options Price Years Outstanding at January 1, 2022 434,939 $ 1.675747 8.56 Granted — — — Exercised — — — Forfeited — — — Cancelled (105,002 ) 1.40 — Expired — — — Outstanding at September 30, 2022 329,937 $ 1.763503 7.83 Exercisable at September 30, 2022 318,508 $ 1.726311 7.81 As of September 30, 2022, vested outstanding stock options had $ 169 85 12 The Company recognizes compensation expense for stock option awards on a straight-line basis over the applicable service period of the award. The service period is generally the vesting period. The following assumptions were used to calculate share-based compensation expense for year ended September 30, 2022: Schedule of Assumptions used in Share-based Compensation Volatility 171.12 183.48 % Risk-free interest rate 0.46 0.86 % Dividend yield 0.0 % Expected term 5.0 5.75 The Company does not have sufficient historical information to develop reasonable expectations about future exercise patterns and post-vesting employment termination behavior. Accordingly, the Company has elected to use the “simplified method” to estimate the expected term of its share-based awards. The simplified method computes the expected term as the sum of the award’s vesting term plus the original contractual term divided by two. Based on the lack of historical data of volatility for the Company’s common stock, the Company based its estimate of expected volatility on a weighted-average of the historical volatility of comparable public companies that manufacture similar products and are similar in size, stage of life cycle, and financial leverage. Restrictive stock awards Effective as of August 1, 2022, the Company granted a restricted stock award of 84,750 shares of the Company’s common stock to the certain officers and employees, all of which shares vest in four equal installments on each of January 1, 2023, January 1, 2024, January 1, 2025 and January 1, 2026. Under ASC 718, Compensation-Stock Compensation (“ASC 718”) 84,750 shares granted based on the closing price of the Company’s stock at the grant date of the RSU Grant ($ 1.82 per share). Effective as of January 1, 2022, the Company granted a restricted stock award of 11,364 11,364 4.40 On March 8, 2021, the Company granted a restricted stock award of 39,524 39,524 2.10 Schedule of Restricted Stock Units Grant Weighted Average Number of Grant Date Units Fair Value Outstanding at January 1, 2022 — $ — Granted 96,114 1.60 Exercised and converted to common shares — — Forfeited — — Outstanding at September 30, 2022 96,114 $ 1.60 Exercisable at September 30, 2022 8,523 $ 4.40 Warrants The following table shows a summary of common stock warrants through September 30, 2022: Summary of Common Stock Warrants Weighted Weighted Average Average Number of Exercise Contractual Warrants Price Term in Years Outstanding at January 1, 2022 3,637,190 $ 5.16281 4.63 Granted — — — Exercised — — — Forfeited — — — Cancelled — — — Expired — — — Outstanding at September 30, 2022 3,637,190 $ 5.16281 3.90 Exercisable at September 30, 2022 3,637,190 $ 5.16281 3.90 As of September 30, 2022, vested outstanding warrants had $ 158 |
Notes Payable
Notes Payable | 9 Months Ended |
Sep. 30, 2022 | |
Debt Disclosure [Abstract] | |
Notes Payable | 11. Notes Payable PPP Loan On April 22, 2020, the Company, entered into a promissory note with PNC Bank, N.A. (the “PNC Bank”), which provides for a loan in the amount of $ 147,300 127,400 147,300 127,400 Economic Injury Disaster Loan On May 28, 2020, the Company entered into the standard loan documents required for securing a loan (the “EIDL Loan”) from the SBA under its Economic Injury Disaster Loan (“EIDL”) assistance program in light of the impact of the COVID-19 pandemic on the Company’s business. Pursuant to that certain Loan Authorization and Agreement (the “SBA Loan Agreement”), the principal amount of the EIDL Loan is up to $ 260,500 3.75 1,270 thirty years 8 283 276 |
Convertible Notes Payable
Convertible Notes Payable | 9 Months Ended |
Sep. 30, 2022 | |
Debt Disclosure [Abstract] | |
Convertible Notes Payable | 12. Convertible Notes Payable On December 24, 2020, the Company issued a $ 100 6 2.80 On January 19, 2021, the Company issued a $ 15 1.05 Auctus Fund Financing On March 11, 2021, the Company and Auctus Fund, LLC, a Delaware limited liability company (“Auctus”) entered into a senior secured convertible promissory note in the principal amount of $ 1,680 thousand , which includes $ 180 thousand of interest which was deemed fully earned as of the issuance date (the “Auctus Note”). The Auctus Note was fully repaid (including all principal and interest) on March 15, 2022 with a one-time cash payment of $ 1,680 thousand . Investor Private Placement Offering On September 2, 2021, the Company closed a private placement offering with twenty accredited investors (the “September 2 Investors”) whereby the Company issued to the September 2 Investors subordinated secured convertible promissory notes in the aggregate principal amount of $ 1,814 thousand , which includes $ 194 thousand of interest which was deemed fully earned as of the issuance date (the “September 2 Notes”). On January 25, 2022, the Company repaid a September 2 Investor in full with a one-time cash payment of $ 300 thousand 105 16,800 On September 6, 2022, the September 2 Notes remaining outstanding balance was repaid in full which consisted of principal and interest of $ 1,478 thousand |
Warrant Liability
Warrant Liability | 9 Months Ended |
Sep. 30, 2022 | |
Warrant Liability | |
Warrant Liability | 13. Warrant Liability On September 2, 2021, March 11, 2021, February 3, 2021, December 24, 2020, March 18, 2020, September 10, 2019, and November 6, 2019, the Company issued 22,019 34,286 7,428 7,286 44,286 35,714 114,286 0.49 5.25 Derivatives and Hedging On September 6, 2022, the Company agreed to extend the September 10, 2019 and November 6, 2019 warrants an additional six months until March 9, 2023 and May 5, 2023, respectively. The warrants were remeasured as of September 6, 2022 and consequently resulted in a warrant modification expense of $ 57 The warrants outstanding and fair values at each of the respective valuation dates are summarized below: Schedule of Warrant Liability Warrants Fair Value Warrant Liability Outstanding per Share Fair Value Fair Value as of period ending 12/31/2021 265,305 $ 318 Modification of warrants 57 Change in fair value of warrant liability (3 ) Fair Value as of period ending 9/30/2022 265,305 $ 372 The warrant liabilities are considered Level 3 liabilities on the fair value hierarchy as the determination of fair value includes various assumptions about future activities and the Company’s stock prices and historical volatility of other comparable public companies used as inputs. As of September 30, 2022, none of the warrants have been exercised. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 14. Commitments and Contingencies Litigation The Company may be subject to legal proceedings and claims that arise in the ordinary course of business. Management is not currently aware of any matters that will have a material effect on the financial position, results of operations, or cash flows of the Company. |
Concentrations of Risk
Concentrations of Risk | 9 Months Ended |
Sep. 30, 2022 | |
Risks and Uncertainties [Abstract] | |
Concentrations of Risk | 15. Concentrations of Risk The Company’s revenues are concentrated in a small group of customers with some individually having more than 10% of total revenues. Revenues from two customers that exceeded 10% of total revenues for the nine months ended September 30, 2022 were 39 27 6 53 17 19 Revenues from three customers that exceeded 10% of total revenues for the nine months ended September 30, 2021 were 33 38 24 16 17 0 18 The Company’s financial instruments that are exposed to concentrations of credit risk consist primarily of cash, cash equivalents and marketable securities. Cash balances are maintained principally at major U.S. financial institutions and are insured by the Federal Deposit Insurance Corporation (“FDIC”) up to regulatory limits. Such cash balances are currently in excess of the FDIC insurance limit of $ 250 1,156 Marketable securities are comprised of U.S. treasury bills with original maturities greater than three months. The Company has not experienced any losses in such accounts. The Company believes it is not exposed to any significant credit risk on cash, cash equivalents, and marketable securities and performs periodic evaluations of the credit standing of such institutions. |
Significant Accounting Polici_2
Significant Accounting Policies and Estimates (Policies) | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Use of Estimates | Use of Estimates The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. These estimates and assumptions include an allowances for doubtful accounts, inventory reserves, deferred taxes, share-based compensation and related valuation allowances and fair value of long-lived assets. Actual results could differ from the estimates. |
Reclassifications | Reclassifications We have reclassified, combined or separately disclosed certain amounts in the prior years’ condensed consolidated financial statements and accompanying footnotes to conform with the current period’s presentation. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents is comprised of cash in banks and highly liquid investments, including U.S. treasury bills purchased with an original maturity of three months or less. Cash equivalents consist of investments in money market funds for which the carrying amount approximates fair value, due to the short maturities of these investments. |
Marketable Securities | Marketable Securities The Company classifies its marketable securities as held-to-maturity, which include U.S. treasury bills with original maturities of greater than three months. These securities are carried at cost. The total unrecognized gain related to the marketable securities was inconsequential during the nine months ended September 30, 2022. Schedule of Marketable Securities September 30, 2022 Marketable Securities United States treasury bills (due December 29, 2022) $ 494 United States treasury bills (due February 23, 2023) 492 United States treasury bills (due June 15, 2023) 4,387 United States treasury bills (due July 13, 2023) 127 United States treasury bills (due August 10, 2023) 485 Total $ 5,985 |
Accounts Receivable, net | Accounts Receivable, net Trade accounts receivable are stated at the amount the Company expects to collect and do not bear interest. The Company evaluates the collectability of accounts receivable and records a provision to the allowance for doubtful accounts based on factors including the length of time the receivables are past due, the current business environment and the Company’s historical experience. Provisions to the allowances for doubtful accounts are recorded in selling, general and administrative expenses. Account balances are charged off against the allowance when it is probable that the receivable will not be recovered. The allowance for doubtful accounts was $ 10 4 |
Inventory and Cost of Revenues | Inventory and Cost of Revenues Inventory is stated at the lower of cost, the value determined by the first-in, first-out method, or net realizable value. The Company evaluates inventories for excess quantities, obsolescence, and shelf-life expiration. This evaluation includes an analysis of historical sales levels by product, projections of future demand, the risk of technological or competitive obsolescence for products, general market conditions, and a review of the shelf-life expiration dates for products. These factors determine when, and if, the Company adjusts the carrying value of inventory to estimated net realizable value. The balance is made up of raw materials, work-in-progress, and finished goods of $ 285 87 27 266 0 25 The Company produces proprietary branded products and white label opportunities in our manufacturing of consumer products. In our contract manufacturing, the Company builds its products based on customer orders and immediately ships the products upon completion of the production process. The “Cost of Revenues” line item in the consolidated statements of operations is comprised of the book value of inventory sold to customers during the reporting period. When circumstances dictate that we use net realizable value as the basis for recording inventory, we base our estimates on expected future selling prices less expected disposal costs. |
Research and Development | Research and Development Our research and development activities focus on new and innovative products designed to support revenue growth. Research and development expenses consist primarily of contracted development and testing efforts associated with development of products. |
Shipping and Handling Revenue and Expense | Shipping and Handling Revenue and Expense Shipping and handling revenue and expense are included in our consolidated statements of operations in Revenue and Cost of revenues, respectively. This is primarily through shipping fees incurred in the Amazon marketplace. |
Property and Equipment, net | Property and Equipment, net Property and equipment is recorded at historical cost, net of accumulated depreciation and amortization. Depreciation is provided over the assets’ useful lives on a straight-line basis. Leasehold improvements are amortized on a straight-line basis over the shorter of their estimated useful lives or lease terms. Repairs and maintenance costs are expensed as incurred. Management periodically assesses the estimated useful life over which assets are depreciated or amortized. If the analysis warrants a change in the estimated useful life of property and equipment, management will reduce the estimated useful life and depreciate or amortize the carrying value prospectively over the shorter remaining useful life. The carrying amounts of assets sold or retired and the related accumulated depreciation are eliminated in the period of disposal and the resulting gains and losses are included in the results of operations during the same period. |
Goodwill and Intangible Assets | Goodwill and Intangible Assets In applying the acquisition method of accounting, amounts assigned to identifiable assets and liabilities acquired were based on estimated fair values as of the date of acquisition, with the remainder recorded as goodwill. Identifiable intangible assets are initially recorded at fair value using generally accepted valuation methods appropriate for the type of intangible asset. Identifiable intangible assets with definite lives are amortized over their estimated useful lives and are reviewed for impairment if indicators of impairment arise. Intangible assets with indefinite lives are tested for impairment within one year of acquisitions or annually as of December 31, and whenever indicators of impairment exist. The fair value of intangible assets are compared with their carrying values, and an impairment loss would be recognized for the amount by which a carrying amount exceeds its fair value. The Company performed the annual assessment and concluded it is more likely than not that the fair value exceeds the carrying value. |
Prepaid Expenses and Other Current Assets | Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets is recorded at historical cost and is primarily made up of $ 98 23 141 54 |
Other Assets | Other Assets Other assets is recorded at historical costs, and as of September 30, 2022 and December 31, 2021, the balance is primarily made up of spare parts for manufacturing equipment. Spare parts are stated at cost and are not subject to depreciation, until such time that they are placed into service and the part that is being replaced is disposed. |
Fair Value Measurements | Fair Value Measurements The Company utilizes the fair value hierarchy to apply fair value measurements. The fair value hierarchy is based on inputs to valuation techniques that are used to measure fair values that are either observable or unobservable. Observable inputs reflect assumptions market participants would use in pricing an asset or liability based on market data obtained from independent sources, while unobservable inputs reflect a reporting entity’s pricing based upon its own market assumptions. The basis for fair value measurements for each level within the hierarchy is described below: Level 1 Level 2 Level 3 The Company considers the carrying amounts of its financial instruments (cash, accounts receivable and accounts payable, notes payable and convertible notes payable) in the balance sheet to approximate fair value because of the short-term or highly liquid nature of these financial instruments. The following table sets forth the fair value of the Company’s financial assets within the fair value hierarchy: Schedule of Fair Value of Financial Assets Level 1 Level 2 Level 3 Fair Value September 30, 2022 Level 1 Level 2 Level 3 Fair Value Assets Marketable securities: United States treasury bills $ 5,985 $ — $ — $ 5,985 Total $ 5,985 $ — $ — $ 5,985 |
Warrant Liability | Warrant Liability Warrants to purchase common stock were issued in connection with equity financing raises, which occurred on September 2, 2021, March 11, 2021, February 3, 2021, December 24, 2020, March 18, 2020, September 10, 2019 and November 6, 2019. The fair values of the warrants are estimated as of the date of issuance and again at each period end using a Black-Scholes option valuation model. At issuance, the fair values of the warrants are recognized as an equity issuance cost within additional paid-in-capital. Fair value adjustments to the warrant liability are recognized in other income (expense) in the statements of operations. |
Revenue Recognition | Revenue Recognition On January 1, 2018, the Company adopted Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers The Company currently recognizes revenue predominately from three types of revenue, contract manufacturing, custom and white label finished goods manufacturing and our branded products. Revenues from manufactured products are recognized at the point where the customer obtains control of the goods and the Company satisfies its performance obligation, which generally is at the time the customer receives the product. The Company’s customers consist of other life sciences companies and Amazon retail customers. Revenues are entirely concentrated in the United States. Payment terms vary by the type and location of customer and may differ by jurisdiction and customer but payment is generally required in a term ranging from 30 to 60 days from date of shipment. Estimates for product returns, allowances and discounts are recorded as a reduction of revenue and are established at the time of sale. Returns are estimated through a comparison of historical return data and are determined for each product and adjusted for known or expected changes in the marketplace specific to each product, when appropriate. Historically, sales return provisions have not been material. Amounts accrued for sales allowances and discounts are based on estimates of amounts that are expected to be claimed on the related sales and are based on historical data. Payments for allowances and discounts have historically been immaterial. Disaggregated revenue by sales type: Schedule of Disaggregated Revenue by Sales Type 2022 2021 Three months ending September 30, 2022 2021 Contract manufacturing $ 277 $ 180 Custom and white label finished goods manufacturing 15 - NexGel branded consumer products 231 155 Other 45 - Total $ 568 $ 335 2022 2021 Nine months ending September 30, 2022 2021 Contract manufacturing $ 736 $ 559 Custom and white label finished goods manufacturing 34 194 NexGel branded consumer products 623 265 Other 131 — Total $ 1,524 $ 1,018 As of September 30, 2022 and December 31, 2021, the Company did not have any contract assets or contract liabilities from contracts with customers. As of September 30, 2022 and December 31, 2021, there were no |
Share-based Compensation | Share-based Compensation On August 28, 2019, the Company adopted the 2019 Long-Term Incentive Plan, as amended (the “2019 Plan”). See Note 10 below for further details regarding the 2019 Plan. The 2019 Plan provides certain employees, contractors, and outside directors with share-based compensation in the form of incentive stock options, nonqualified stock options, stock appreciation rights, restricted stock, restricted stock units, performance awards, dividend equivalent rights and other awards. The fair values of incentive stock option award grants are estimated as of the date of grant using a Black-Scholes option valuation model. Compensation expense is recognized in the statements of operations on a straight-line basis over the requisite service period, which is generally the vesting period required to obtain full vesting. Forfeitures are accounted for when they occur. In June 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2018-07, Compensation - Stock Compensation (Topic 718) - Improvements to Nonemployee Share-Based Payment Accounting Compensation - Stock Compensation |
Income Taxes | Income Taxes Income taxes are accounted for using an asset and liability approach that requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the financial statement and tax bases of assets and liabilities at the applicable tax rates. Deferred tax assets are reduced by a valuation allowance when it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates. |
Recently Issued Accounting Standards | Recently Issued Accounting Standards From time to time, new accounting pronouncements are issued by the FASB or other standard setting bodies and adopted by us as of the specified effective date. Unless otherwise discussed, the impact of recently issued standards that are not yet effective will not have a material impact on our financial position or results of operations upon adoption. In June 2016, the FASB issued Accounting Standards Update (“ASU”) 2016-13, Financial Instruments - Credit Losses Measurement of Credit Losses on Financial Instruments In January 2017, the FASB issued ASU 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes |
Significant Accounting Polici_3
Significant Accounting Policies and Estimates (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Schedule of Marketable Securities | Schedule of Marketable Securities September 30, 2022 Marketable Securities United States treasury bills (due December 29, 2022) $ 494 United States treasury bills (due February 23, 2023) 492 United States treasury bills (due June 15, 2023) 4,387 United States treasury bills (due July 13, 2023) 127 United States treasury bills (due August 10, 2023) 485 Total $ 5,985 |
Schedule of Fair Value of Financial Assets | The following table sets forth the fair value of the Company’s financial assets within the fair value hierarchy: Schedule of Fair Value of Financial Assets Level 1 Level 2 Level 3 Fair Value September 30, 2022 Level 1 Level 2 Level 3 Fair Value Assets Marketable securities: United States treasury bills $ 5,985 $ — $ — $ 5,985 Total $ 5,985 $ — $ — $ 5,985 |
Schedule of Disaggregated Revenue by Sales Type | Disaggregated revenue by sales type: Schedule of Disaggregated Revenue by Sales Type 2022 2021 Three months ending September 30, 2022 2021 Contract manufacturing $ 277 $ 180 Custom and white label finished goods manufacturing 15 - NexGel branded consumer products 231 155 Other 45 - Total $ 568 $ 335 2022 2021 Nine months ending September 30, 2022 2021 Contract manufacturing $ 736 $ 559 Custom and white label finished goods manufacturing 34 194 NexGel branded consumer products 623 265 Other 131 — Total $ 1,524 $ 1,018 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Leases | |
Schedule of Future Minimum Lease Payments | The following table presents information about the amount and timing of the liability arising from the Company’s operating lease as of September 30, 2022 ($ in thousands): Schedule of Future Minimum Lease Payments Operating Lease Maturity of Lease Liability Liability 2022 $ 52 2023 207 2024 207 2025 207 2026 263 Thereafter 1,165 Total undiscounted operating lease payments $ 2,101 Less: Imputed interest (262 ) Present value of operating lease liability $ 1,839 Weighted average remaining lease term 8.25 Weighted average discount rate 3.0 % |
Schedule of Supplemental Cash Flows Information Related to Leases | Supplemental cash flows information related to leases was as follows ($ in thousands): Schedule of Supplemental Cash Flows Information Related to Leases September 30, 2022 Cash paid for amounts included in the measurement of lease liability: Operating cash flows from operating lease $ 155 |
Inventory (Tables)
Inventory (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | Inventory consists of the following ($ in thousands): Schedule of Inventory September 30, December 31, 2022 2021 Raw materials $ 285 $ 266 Work-in-progress 87 - Finished goods 27 25 Inventory, gross 399 291 Less: Inventory reserve for excess and slow moving inventory — — Total $ 399 $ 291 |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | Property and equipment consist of the following ($ in thousands): Schedule of Property and Equipment Useful Life September 30, December 31, (Years) 2022 2021 Machinery and equipment 3 10 $ 972 $ 940 Office furniture and equipment 3 10 59 50 Leasehold improvements 6 228 228 Construction in progress - 48 - Property and equipment, gross 1,307 1,218 Less: accumulated depreciation and amortization (570 ) (495 ) Property and equipment, net $ 737 $ 723 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Breakdown of Identifiable Intangible Assets | The following provides a breakdown of identifiable intangible assets as of September 30, 2022 and December 31, 2021 ($ in thousands): Schedule of Breakdown of Identifiable Intangible Assets September 30, December 31, 2022 2021 Product/Technology Related Identifiable intangible assets, gross $ 31 $ 31 Accumulated amortization (24 ) (16 ) Product/Technology related identifiable intangible assets, net 7 15 Marketing Related Customer related intangible asset, gross 17 17 Tradename related intangible asset, gross 7 7 Accumulated amortization (8 ) (6 ) Marketing related identifiable intangible assets, net 16 18 Total identifiable intangible assets, net $ 23 $ 33 |
Schedule of Estimated Annual Amortization Expense | As of September 30, 2022, the estimated annual amortization expense for each of the next five fiscal years is as follows ($ in thousands): Schedule of Estimated Annual Amortization Expense 2022 (reminder of the year) $ 4 2023 8 2024 2 2025 2 2026 2 Thereafter 5 Total $ 23 |
Accrued Expenses and Other Cu_2
Accrued Expenses and Other Current Liabilities (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Expenses and Other Current Liabilities | Accrued expenses and other current liabilities consist of the following ($ in thousands): Schedule of Accrued Expenses and Other Current Liabilities September 30, December 31, 2022 2021 Salaries, benefits, and incentive compensation $ 48 $ 54 Franchise tax accrual 107 - Other 9 8 Total accrued expenses and other current liabilities $ 164 $ 62 |
Common Stock (Tables)
Common Stock (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Equity [Abstract] | |
Schedule of Reserved Common Stock For Issuance in Relation | At September 30, 2022, the Company has reserved common stock for issuance in relation to the following: Schedule of Reserved Common Stock For Issuance in Relation Share-based compensation plan 329,937 Warrants to purchase common stock 3,637,190 |
Share-based Compensation (Table
Share-based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Information about Incentive Plan | The following table contains information about the 2019 Plan as of September 30, 2022: Schedule of Information about Incentive Plan Awards Awards Reserved for Awards Awards Available for Issuance Issued Exercised Grant 2019 Plan 571,429 329,937 7,183 234,309 |
Schedule of Incentive Stock Option Activity | The following table summarizes the Company’s incentive stock option activity and related information for the period ended September 30, 2022: Schedule of Incentive Stock Option Activity Weighted Weighted Average Average Contractual Number of Exercise Term in Options Price Years Outstanding at January 1, 2022 434,939 $ 1.675747 8.56 Granted — — — Exercised — — — Forfeited — — — Cancelled (105,002 ) 1.40 — Expired — — — Outstanding at September 30, 2022 329,937 $ 1.763503 7.83 Exercisable at September 30, 2022 318,508 $ 1.726311 7.81 |
Schedule of Assumptions used in Share-based Compensation | Schedule of Assumptions used in Share-based Compensation Volatility 171.12 183.48 % Risk-free interest rate 0.46 0.86 % Dividend yield 0.0 % Expected term 5.0 5.75 |
Schedule of Restricted Stock Units Grant | Schedule of Restricted Stock Units Grant Weighted Average Number of Grant Date Units Fair Value Outstanding at January 1, 2022 — $ — Granted 96,114 1.60 Exercised and converted to common shares — — Forfeited — — Outstanding at September 30, 2022 96,114 $ 1.60 Exercisable at September 30, 2022 8,523 $ 4.40 |
Summary of Common Stock Warrants | The following table shows a summary of common stock warrants through September 30, 2022: Summary of Common Stock Warrants Weighted Weighted Average Average Number of Exercise Contractual Warrants Price Term in Years Outstanding at January 1, 2022 3,637,190 $ 5.16281 4.63 Granted — — — Exercised — — — Forfeited — — — Cancelled — — — Expired — — — Outstanding at September 30, 2022 3,637,190 $ 5.16281 3.90 Exercisable at September 30, 2022 3,637,190 $ 5.16281 3.90 |
Warrant Liability (Tables)
Warrant Liability (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Warrant Liability | |
Schedule of Warrant Liability | The warrants outstanding and fair values at each of the respective valuation dates are summarized below: Schedule of Warrant Liability Warrants Fair Value Warrant Liability Outstanding per Share Fair Value Fair Value as of period ending 12/31/2021 265,305 $ 318 Modification of warrants 57 Change in fair value of warrant liability (3 ) Fair Value as of period ending 9/30/2022 265,305 $ 372 |
Description of Business, the _2
Description of Business, the Spin-off and Basis of Presentation (Details Narrative) - $ / shares | Nov. 29, 2021 | Sep. 30, 2022 | Dec. 31, 2021 | Dec. 27, 2021 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
Reverse stock split | 1-for-35 reverse stock split | |||
Common stock, par value | $ 0.001 | $ 0.001 | $ 0.001 | $ 0.001 |
Going Concern (Details Narrativ
Going Concern (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | |||||||||
Dec. 27, 2021 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | Nov. 29, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||
Cash | $ 1,400 | $ 1,400 | |||||||||
Marketable securities | 5,985 | 5,985 | |||||||||
Net loss | 1,227 | $ 1,035 | $ 1,836 | $ 1,142 | $ 825 | $ 704 | 4,098 | $ 2,671 | |||
Net cash used in operating activities | 2,343 | $ 1,556 | |||||||||
Working capital | $ 7,200 | $ 7,200 | |||||||||
Number of units sold | 2,585,000 | ||||||||||
Purchase price, per unit | $ 5.50 | ||||||||||
Common stock, par value | 0.001 | $ 0.001 | $ 0.001 | $ 0.001 | $ 0.001 | ||||||
Exercise price | $ 5.50 | ||||||||||
Proceeds from warrants exercise | $ 14,200 |
Schedule of Marketable Securiti
Schedule of Marketable Securities (Details) $ in Thousands | Sep. 30, 2022 USD ($) |
Debt Securities, Held-to-Maturity, Allowance for Credit Loss [Line Items] | |
Total | $ 5,985 |
US Treasury Securities [Member] | |
Debt Securities, Held-to-Maturity, Allowance for Credit Loss [Line Items] | |
Total | 5,985 |
US Treasury Securities [Member] | Due December 29, 2022 [Member] | |
Debt Securities, Held-to-Maturity, Allowance for Credit Loss [Line Items] | |
Total | 494 |
US Treasury Securities [Member] | Due February 23, 2023 [Member] | |
Debt Securities, Held-to-Maturity, Allowance for Credit Loss [Line Items] | |
Total | 492 |
US Treasury Securities [Member] | Due June 15, 2023 [Member] | |
Debt Securities, Held-to-Maturity, Allowance for Credit Loss [Line Items] | |
Total | 4,387 |
US Treasury Securities [Member] | Due July 13, 2023 [Member] | |
Debt Securities, Held-to-Maturity, Allowance for Credit Loss [Line Items] | |
Total | 127 |
US Treasury Securities [Member] | Due August 10, 2023 [Member] | |
Debt Securities, Held-to-Maturity, Allowance for Credit Loss [Line Items] | |
Total | $ 485 |
Schedule of Fair Value of Finan
Schedule of Fair Value of Financial Assets (Details) $ in Thousands | Sep. 30, 2022 USD ($) |
Defined Benefit Plan Disclosure [Line Items] | |
Total | $ 5,985 |
US Treasury Securities [Member] | |
Defined Benefit Plan Disclosure [Line Items] | |
Total | 5,985 |
Fair Value, Inputs, Level 1 [Member] | |
Defined Benefit Plan Disclosure [Line Items] | |
Total | 5,985 |
Fair Value, Inputs, Level 1 [Member] | US Treasury Securities [Member] | |
Defined Benefit Plan Disclosure [Line Items] | |
Total | 5,985 |
Fair Value, Inputs, Level 2 [Member] | |
Defined Benefit Plan Disclosure [Line Items] | |
Total | |
Fair Value, Inputs, Level 2 [Member] | US Treasury Securities [Member] | |
Defined Benefit Plan Disclosure [Line Items] | |
Total | |
Fair Value, Inputs, Level 3 [Member] | |
Defined Benefit Plan Disclosure [Line Items] | |
Total | |
Fair Value, Inputs, Level 3 [Member] | US Treasury Securities [Member] | |
Defined Benefit Plan Disclosure [Line Items] | |
Total |
Schedule of Disaggregated Reven
Schedule of Disaggregated Revenue by Sales Type (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Accounting Policies [Abstract] | ||||
Contract manufacturing | $ 277 | $ 180 | $ 736 | $ 559 |
Custom and white label finished goods manufacturing | 15 | 34 | 194 | |
NexGel branded consumer products | 231 | 155 | 623 | 265 |
Other | 45 | 131 | ||
Total | $ 568 | $ 335 | $ 1,524 | $ 1,018 |
Significant Accounting Polici_4
Significant Accounting Policies and Estimates (Details Narrative) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Accounting Policies [Abstract] | ||
Allowance for doubtful accounts | $ 10 | $ 4 |
Raw materials | 285 | 266 |
Work-in-progress | 87 | |
Finished goods | 27 | 25 |
Prepaid insurance | 98 | 23 |
General prepaid expenses | 141 | 54 |
Remaining performance obligations | $ 0 | $ 0 |
Schedule of Future Minimum Leas
Schedule of Future Minimum Lease Payments (Details) $ in Thousands | Sep. 30, 2022 USD ($) |
Maturity of Lease Liability | |
2022 | $ 52 |
2023 | 207 |
2024 | 207 |
2025 | 207 |
2026 | 263 |
Thereafter | 1,165 |
Total undiscounted operating lease payments | 2,101 |
Less: Imputed interest | (262) |
Present value of operating lease liability | $ 1,839 |
Weighted average remaining lease term | 8 years 3 months |
Weighted average discount rate | 3% |
Schedule of Supplemental Cash F
Schedule of Supplemental Cash Flows Information Related to Leases (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2022 USD ($) | |
Leases | |
Operating cash flows from operating lease | $ 155 |
Leases (Details Narrative)
Leases (Details Narrative) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Leases | ||
Operating lease expense | $ 155 | $ 192 |
Schedule of Inventory (Details)
Schedule of Inventory (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 285 | $ 266 |
Work-in-progress | 87 | |
Finished goods | 27 | 25 |
Inventory, gross | 399 | 291 |
Less: Inventory reserve for excess and slow moving inventory | ||
Total | $ 399 | $ 291 |
Schedule of Property and Equipm
Schedule of Property and Equipment (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Dec. 31, 2021 | |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 1,307 | $ 1,218 |
Less: accumulated depreciation and amortization | (570) | (495) |
Property and equipment, net | 737 | 723 |
Machinery and Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 972 | 940 |
Machinery and Equipment [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Useful Life (Years) | 3 years | |
Machinery and Equipment [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Useful Life (Years) | 10 years | |
Furniture and Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 59 | 50 |
Furniture and Fixtures [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Useful Life (Years) | 3 years | |
Furniture and Fixtures [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Useful Life (Years) | 10 years | |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Useful Life (Years) | 6 years | |
Property and equipment, gross | $ 228 | 228 |
Construction in Progress [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 48 |
Property and Equipment, Net (De
Property and Equipment, Net (Details Narrative) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation expense | $ 74 | $ 75 |
Schedule of Breakdown of Identi
Schedule of Breakdown of Identifiable Intangible Assets (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Finite-Lived Intangible Assets [Line Items] | ||
Total | $ 23 | $ 33 |
Technology-Based Intangible Assets [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Identifiable intangible assets, gross | 31 | 31 |
Accumulated amortization | (24) | (16) |
Total | 7 | 15 |
Customer-Related Intangible Assets [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Identifiable intangible assets, gross | 17 | 17 |
Trade Names [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Identifiable intangible assets, gross | 7 | 7 |
Marketing-Related Intangible Assets [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Accumulated amortization | (8) | (6) |
Total | $ 16 | $ 18 |
Schedule of Estimated Annual Am
Schedule of Estimated Annual Amortization Expense (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2022 (reminder of the year) | $ 4 | |
2023 | 8 | |
2024 | 2 | |
2025 | 2 | |
2026 | 2 | |
Thereafter | 5 | |
Total | $ 23 | $ 33 |
Intangible Assets (Details Narr
Intangible Assets (Details Narrative) - Sport Defense LLC [Member] - Technology Related and Customer Related Intangibles [Member] - USD ($) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2020 | |
Finite-Lived Intangible Assets [Line Items] | |||
Intangibles | $ 55 | ||
Expected life | 3 years 8 months 12 days | 3 years 8 months 12 days | |
Amortization expense | $ 10 | $ 10 |
Schedule of Accrued Expenses an
Schedule of Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Payables and Accruals [Abstract] | ||
Salaries, benefits, and incentive compensation | $ 48 | $ 54 |
Franchise tax accrual | 107 | |
Other | 9 | 8 |
Total accrued expenses and other current liabilities | $ 164 | $ 62 |
Schedule of Reserved Common Sto
Schedule of Reserved Common Stock For Issuance in Relation (Details) | 9 Months Ended |
Sep. 30, 2022 shares | |
Equity [Abstract] | |
Share-based compensation plan | 329,937 |
Warrants to purchase common Stock | 3,637,190 |
Common Stock (Details Narrative
Common Stock (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Dec. 27, 2021 | Mar. 31, 2021 | |
Subsidiary, Sale of Stock [Line Items] | ||
Number of units sold | 2,585,000 | |
Purchase price, per unit | $ 5.50 | |
Exercise price | $ 5.50 | |
Aggregate purchase price | $ 285 | |
IPO [Member] | ||
Subsidiary, Sale of Stock [Line Items] | ||
Number of units sold | 2,585,000 | |
Purchase price, per unit | $ 5.50 | |
Exercise price | $ 5.50 | |
Additional number of days | 45 days | |
Additional shares of common stock issued | 387,750 | |
Number of additional warrants issued | 387,750 | |
Underwriter [Member] | ||
Subsidiary, Sale of Stock [Line Items] | ||
Value of common stock offered on initial closing date | 387,750 | |
Private Placement [Member] | ||
Subsidiary, Sale of Stock [Line Items] | ||
Purchase price, per unit | $ 2.80 | |
Issuances of common stock, net of issuance costs (in shares) | 101,800 | |
Aggregate purchase price | $ 285 |
Schedule of Information about I
Schedule of Information about Incentive Plan (Details) - 2019 Plan [Member] - shares | 9 Months Ended | |||
Aug. 28, 2019 | Sep. 30, 2022 | May 03, 2021 | May 26, 2020 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||
Awards reserved for issuance | 571,429 | 485,715 | 57,143 | |
Awards issued | 329,937 | 571,429 | 485,715 | |
Awards exercised | 7,183 | |||
Awards available for grant | 57,143 | 234,309 |
Schedule of Incentive Stock Opt
Schedule of Incentive Stock Option Activity (Details) - Equity Option [Member] - 2019 Plan [Member] - $ / shares | 9 Months Ended | 12 Months Ended |
Sep. 30, 2022 | Dec. 31, 2021 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Number of options, outstanding, beginning balance | 434,939 | |
Weighted average exercise price, outstanding beginning balance | $ 1.675747 | |
Weighted average remaining contractual term | 7 years 9 months 29 days | 8 years 6 months 21 days |
Number of options, granted | ||
Weighted average exercise price, granted | ||
Number of options, exercised | ||
Weighted average exercise price, exercised | ||
Number of options, forfeited | ||
Weighted average exercise price, forfeited | ||
Number of options, cancelled | (105,002) | |
Weighted average exercise price, cancelled | $ 1.40 | |
Number of options, expired | ||
Weighted average exercise price, expired | ||
Number of options, outstanding, ending balance | 329,937 | 434,939 |
Weighted average exercise price, outstanding ending balance | $ 1.763503 | $ 1.675747 |
Number of options, exercisable | 318,508 | |
Weighted average exercise price, exercisable | $ 1.726311 | |
Weighted average remaining contractual term, exercisable | 7 years 9 months 21 days |
Schedule of Assumptions used in
Schedule of Assumptions used in Share-based Compensation (Details) | 9 Months Ended |
Sep. 30, 2022 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Volatility - Minimum | 171.12% |
Volatility - Maximum | 183.48% |
Risk-free interest rate - Minimum | 0.46% |
Risk-free interest rate - Maximum | 0.86% |
Dividend yield | 0% |
Minimum [Member] | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Expected term | 5 years |
Maximum [Member] | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Expected term | 5 years 9 months |
Schedule of Restricted Stock Un
Schedule of Restricted Stock Units Grant (Details) | 9 Months Ended |
Sep. 30, 2022 $ / shares shares | |
Share-Based Payment Arrangement [Abstract] | |
Number of units outstanding beginning | shares | |
Weighted average grant date fair value outstanding beginning | $ / shares | |
Number of units, granted | shares | 96,114 |
Weighted average grant date fair value, granted | $ / shares | $ 1.60 |
Number of units, exercised and converted to common shares | shares | |
Weighted average grant date fair value, exercised and converted to common shares | $ / shares | |
Number of units, forfeited | shares | |
Weighted average grant date fair value, forfeited | $ / shares | |
Number of units outstanding ending | shares | 96,114 |
Weighted average grant date fair value outstanding ending | $ / shares | $ 1.60 |
Number of units exercisable | shares | 8,523 |
Weighted average grant date fair value exercisable | $ / shares | $ 4.40 |
Summary of Common Stock Warrant
Summary of Common Stock Warrants (Details) - $ / shares | 9 Months Ended | 12 Months Ended |
Sep. 30, 2022 | Dec. 31, 2021 | |
Share-Based Payment Arrangement [Abstract] | ||
Number of warrants, outstanding beginning balance | 3,637,190 | |
Weighted average exercise price, outstanding beginning balance | $ 5.16281 | |
Weighted average remaining contractual term | 3 years 10 months 24 days | 4 years 7 months 17 days |
Number of warrants, granted | ||
Weighted average exercise price, granted | ||
Number of warrants, exercised | ||
Weighted average exercise price, exercised | ||
Number of warrants, forfeited | ||
Weighted average exercise price, forfeited | ||
Number of warrants, cancelled | ||
Weighted average exercise price, cancelled | ||
Number of warrants, expired | ||
Weighted average exercise price, expired | ||
Number of warrants, outstanding ending balance | 3,637,190 | 3,637,190 |
Weighted average exercise price, outstanding ending balance | $ 5.16281 | $ 5.16281 |
Number of warrants, exercisable | 3,637,190 | |
Weighted average exercise price, exercisable | $ 5.16281 | |
Weighted average remaining contractual term, exercisable | 3 years 10 months 24 days |
Share-based Compensation (Detai
Share-based Compensation (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | ||||||
Aug. 01, 2022 | Jan. 01, 2022 | Mar. 08, 2021 | Aug. 28, 2019 | Sep. 30, 2022 | May 03, 2021 | May 26, 2020 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||||||
Restricted stock award shares, granted | 96,114 | ||||||
Intrinsic value of vested outstanding warrants | $ 158 | ||||||
Officers and Employees [Member | Restricted Stock [Member] | |||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||||||
Restricted stock award shares, granted | 84,750 | ||||||
Number of restricted stock award shares | 84,750 | ||||||
Share Price | $ 1.82 | ||||||
Chief Executive Officer [Member] | Restricted Stock [Member] | |||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||||||
Restricted stock award shares, granted | 11,364 | ||||||
Number of restricted stock award shares | 11,364 | ||||||
Share Price | $ 4.40 | ||||||
Chief Executive Officer and Chief Financial Officer [Member] | Restricted Stock [Member] | |||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||||||
Restricted stock award shares, granted | 39,524 | ||||||
Number of restricted stock award shares | 39,524 | ||||||
Share Price | $ 2.10 | ||||||
2019 Plan [Member] | |||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||||||
Shares awarded | 57,143 | 234,309 | |||||
Common stock reserved for issuance | 571,429 | 485,715 | 57,143 | ||||
Number of shares available for grant | 329,937 | 571,429 | 485,715 | ||||
2019 Plan [Member] | Equity Option [Member] | |||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||||||
Intrinsic value | $ 169 | ||||||
Unrecognized share-based compensation expense | $ 85 | ||||||
Period of recognition of stock based compensation expense | 12 months | ||||||
2019 Plan [Member] | Executive Officer [Member] | |||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||||||
Number of shares available for grant | 14,286 |
Notes Payable (Details Narrativ
Notes Payable (Details Narrative) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | |||||
May 28, 2020 | Sep. 30, 2022 | Dec. 31, 2021 | Nov. 16, 2021 | Jun. 02, 2021 | Mar. 04, 2021 | Apr. 22, 2020 | |
Short-Term Debt [Line Items] | |||||||
Accrued interest | $ 283 | $ 276 | |||||
Paycheck Protection Program Loan [Member] | |||||||
Short-Term Debt [Line Items] | |||||||
Loan amount | $ 127,400 | $ 147,300 | $ 127,400 | $ 147,300 | |||
Economic Injury Disaster Loan [Member] | |||||||
Short-Term Debt [Line Items] | |||||||
Borrowing capacity | $ 260,500 | ||||||
Interest rate | 3.75% | ||||||
DebtInstrument periodic payment | $ 1,270 | ||||||
Term of the loan | 30 years | ||||||
Loan advance | $ 8 |
Convertible Notes Payable (Deta
Convertible Notes Payable (Details Narrative) - USD ($) | Jan. 25, 2022 | Sep. 02, 2021 | Mar. 11, 2021 | Sep. 06, 2022 | Jan. 19, 2021 | Dec. 24, 2020 |
Short-Term Debt [Line Items] | ||||||
Principal amount of debt | $ 300,000 | $ 1,680,000 | $ 1,478,000 | |||
Prepayment penalty percent | 105% | |||||
Repayment of principal | $ 16,800 | |||||
September 2 Investors [Member] | ||||||
Short-Term Debt [Line Items] | ||||||
Principal amount of debt | $ 1,814,000 | |||||
Interest amount | $ 194,000 | |||||
Auctus Note [Member] | ||||||
Short-Term Debt [Line Items] | ||||||
Principal amount of debt | 1,680,000 | |||||
Interest amount | $ 180,000 | |||||
Convertible Promissory Note [Member] | ||||||
Short-Term Debt [Line Items] | ||||||
Principal amount of debt | $ 15,000 | $ 100,000 | ||||
Interest rate, percentage | 6% | |||||
Conversion price | $ 1.05 | $ 2.80 |
Schedule of Warrant Liability (
Schedule of Warrant Liability (Details) Pure in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 06, 2022 USD ($) | Sep. 30, 2022 USD ($) shares | Sep. 30, 2021 USD ($) | Sep. 30, 2022 USD ($) shares | Sep. 30, 2021 USD ($) | |
Modification of warrants | $ 57 | $ 57 | $ 57 | ||
Change in fair value of warrant liability | $ (104) | $ (2) | $ (3) | $ (10) | |
Warrant [Member] | |||||
Warrants outstanding | shares | 265,305 | ||||
Fair value | 318 | ||||
Modification of warrants | $ 57 | ||||
Change in fair value of warrant liability | $ (3) | ||||
Warrants outstanding | shares | 265,305 | 265,305 | |||
Fair value | 372 | 372 |
Warrant Liability (Details Narr
Warrant Liability (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | |||||||||||
Sep. 06, 2022 | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 27, 2021 | Sep. 02, 2021 | Mar. 11, 2021 | Feb. 03, 2021 | Dec. 24, 2020 | Mar. 18, 2020 | Nov. 06, 2019 | Sep. 10, 2019 | |
Subsidiary, Sale of Stock [Line Items] | |||||||||||||
Warrants exercise price | $ 5.50 | ||||||||||||
Warrant modification expense | $ 57 | $ 57 | $ 57 | ||||||||||
Private Placement [Member] | |||||||||||||
Subsidiary, Sale of Stock [Line Items] | |||||||||||||
Warrants issued | 22,019 | 34,286 | 7,428 | 7,286 | 44,286 | 114,286 | 35,714 | ||||||
Private Placement [Member] | Minimum [Member] | |||||||||||||
Subsidiary, Sale of Stock [Line Items] | |||||||||||||
Warrants exercise price | $ 0.49 | $ 0.49 | |||||||||||
Private Placement [Member] | Maximum [Member] | |||||||||||||
Subsidiary, Sale of Stock [Line Items] | |||||||||||||
Warrants exercise price | $ 5.25 | $ 5.25 |
Concentrations of Risk (Details
Concentrations of Risk (Details Narrative) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Concentration Risk [Line Items] | ||
Cash, FDIC insured amount | $ 250 | |
Cash insured amount excess | $ 1,156 | |
Customer One [Member] | Revenue Benchmark [Member] | Customer Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 39% | 33% |
Customer One [Member] | Accounts Receivable [Member] | Customer Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 6% | 16% |
Customer Two [Member] | Revenue Benchmark [Member] | Customer Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 27% | 38% |
Customer Two [Member] | Accounts Receivable [Member] | Customer Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 53% | 17% |
One Other Customer [Member] | Accounts Receivable [Member] | Customer Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 17% | 18% |
Two Other Customer [Member] | Accounts Receivable [Member] | Customer Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 19% | |
Customer Three [Member] | Revenue Benchmark [Member] | Customer Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 24% | |
Customer Three [Member] | Accounts Receivable [Member] | Customer Concentration Risk [Member] | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 0% |