Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2023 | Nov. 03, 2023 | |
Document and Entity Information | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Sep. 30, 2023 | |
Entity File Number | 001-37717 | |
Entity Registrant Name | Senseonics Holdings, Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 47-1210911 | |
Entity Address, Address Line One | 20451 Seneca Meadows Parkway | |
Entity Address, City or Town | Germantown | |
Entity Address, State or Province | MD | |
Entity Address, Postal Zip Code | 20876-7005 | |
City Area Code | 301 | |
Local Phone Number | 515-7260 | |
Title of 12(b) Security | Common Stock, $0.001 par value | |
Trading Symbol | SENS | |
Security Exchange Name | NYSEAMER | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 528,281,405 | |
Entity Central Index Key | 0001616543 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 55,759 | $ 35,793 |
Short term investments, net | 69,648 | 108,222 |
Inventory, net | 9,726 | 7,306 |
Prepaid expenses and other current assets | 7,557 | 7,428 |
Total current assets | 146,140 | 161,200 |
Deposits and other assets | 6,991 | 3,108 |
Long term investments, net | 12,253 | |
Property and equipment, net | 934 | 1,112 |
Total assets | 154,065 | 177,673 |
Current liabilities: | ||
Accounts payable | 2,669 | 419 |
Note payable, current portion, net | 15,579 | |
Derivative liability, current portion | 20 | |
Total current liabilities | 17,302 | 31,471 |
Long-term debt and notes payables, net | 40,485 | 56,383 |
Derivative liabilities | 245 | 52,050 |
Other liabilities | 6,312 | 2,689 |
Total liabilities | 64,344 | 142,593 |
Preferred stock and additional paid-in-capital, subject to possible redemption: $0.001 par value per share; 12,000 shares and 12,000 shares issued and outstanding as of September 30, 2023 and December 31, 2022 | 37,656 | 37,656 |
Total temporary equity | 37,656 | 37,656 |
Commitments and contingencies | ||
Stockholders' equity (deficit): | ||
Common stock, $0.001 par value per share; 900,000,000 shares authorized as of September 30, 2023 and December 31, 2022; 528,176,273 shares and 479,637,138 shares issued and outstanding as of September 30, 2023 and December 31, 2022 | 528 | 480 |
Additional paid-in capital | 903,665 | 806,488 |
Accumulated other comprehensive loss | (59) | (678) |
Accumulated deficit | (852,069) | (808,866) |
Total stockholders' equity (deficit) | 52,065 | (2,576) |
Total liabilities and stockholders' equity | 154,065 | 177,673 |
Related Party | ||
Current assets: | ||
Accounts receivable, net | 2,749 | 2,324 |
Current liabilities: | ||
Accrued expenses and other current liabilities | 277 | 837 |
Nonrelated Party | ||
Current assets: | ||
Accounts receivable, net | 701 | 127 |
Current liabilities: | ||
Accrued expenses and other current liabilities | $ 14,356 | $ 14,616 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parentheticals) - $ / shares | Sep. 30, 2023 | Dec. 31, 2022 |
Class of stock information | ||
Temporary equity, par or stated value per share | $ 0.001 | $ 0.001 |
Temporary equity, shares issued | 12,000 | 12,000 |
Temporary equity, shares outstanding | 12,000 | 12,000 |
Common stock, par value per share (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 900,000,000 | 900,000,000 |
Common stock, shares issued | 528,176,273 | 479,637,138 |
Common stock, shares outstanding | 528,176,273 | 479,637,138 |
Unaudited Condensed Consolidate
Unaudited Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Revenue, net | $ 6,097 | $ 4,622 | $ 14,360 | $ 10,818 |
Cost of sales | 4,925 | 3,866 | 12,358 | 8,711 |
Gross profit | 1,172 | 756 | 2,002 | 2,107 |
Expenses: | ||||
Research and development expenses | 12,769 | 10,985 | 38,003 | 28,088 |
Selling, general and administrative expenses | 7,425 | 7,340 | 22,598 | 23,785 |
Operating loss | (19,022) | (17,569) | (58,599) | (49,766) |
Other income (expense), net: | ||||
Interest income | 1,460 | 544 | 3,879 | 878 |
Gain (Loss) on fair value adjustment of option | (8,592) | 41,333 | ||
Exchange related gain (loss), net | (4,569) | 14,207 | ||
Interest expense | (2,425) | (4,801) | (9,388) | (13,806) |
Gain (Loss) on change in fair value of derivatives | 438 | (28,948) | 6,505 | 152,169 |
Impairment cost, net | (984) | (138) | ||
Other income (expense) | 15 | (41) | 194 | (112) |
Total other (expense) income, net | (5,081) | (42,822) | 15,397 | 180,324 |
Net (Loss) Income | (24,103) | (60,391) | (43,202) | 130,558 |
Other comprehensive income (loss) | ||||
Unrealized gain (loss) on marketable securities | 61 | (57) | 619 | (973) |
Total other comprehensive gain (loss) | 61 | (57) | 619 | (973) |
Total comprehensive (loss) income | $ (24,042) | $ (60,448) | $ (42,583) | $ 129,585 |
Basic net (loss) income per common share | $ (0.04) | $ (0.13) | $ (0.08) | $ 0.28 |
Basic weighted-average shares outstanding | 592,452,262 | 472,475,747 | 552,703,546 | 464,244,736 |
Diluted net loss per common share | $ (0.04) | $ (0.13) | $ (0.08) | $ (0.10) |
Diluted weighted-average shares outstanding | 592,452,262 | 472,475,747 | 552,703,546 | 608,345,713 |
Related Party | ||||
Revenue, net | $ 5,671 | $ 4,496 | $ 13,184 | $ 10,263 |
Nonrelated Party | ||||
Revenue, net | $ 426 | $ 126 | $ 1,176 | $ 555 |
Unaudited Condensed Consolida_2
Unaudited Condensed Consolidated Statements of Changes in Stockholders' Equity (Deficit) - USD ($) shares in Thousands, $ in Thousands | Preferred Stock Series B Preferred Stock | Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Loss | Accumulated Deficit | Total |
Balance at Dec. 31, 2021 | $ 447 | $ 765,215 | $ (212) | $ (950,985) | $ (185,535) | |
Balance (in shares) at Dec. 31, 2021 | 447,282 | |||||
Changes in Stockholders' Equity (Deficit) | ||||||
Issuance of common stock, net of issuance costs | $ 15 | 34,428 | 34,443 | |||
Issuance of common stock, net of issuance costs (in shares) | 15,161 | |||||
Exercise of stock options and warrants | $ 10 | 941 | 951 | |||
Exercise of stock options and warrants (in shares) | 9,892 | |||||
Issued common stock for vested RSUs and ESPP purchase | $ 7 | 125 | 132 | |||
Issued common stock for vested RSUs and ESPP purchase (in shares) | 6,970 | |||||
Stock-based compensation expense | 6,543 | 6,543 | ||||
Shares withheld related to net share settlement of equity awards | $ (1) | (1,183) | (1,184) | |||
Shares withheld related to net share settlement of equity awards (in shares) | (1,093) | |||||
Net (loss) income | 130,558 | 130,558 | ||||
Other comprehensive (loss) income, net of tax | (973) | (973) | ||||
Balance at Sep. 30, 2022 | $ 478 | 806,069 | (1,185) | (820,427) | (15,065) | |
Balance (in shares) at Sep. 30, 2022 | 478,212 | |||||
Balance at Dec. 31, 2021 | $ 447 | 765,215 | (212) | (950,985) | (185,535) | |
Balance (in shares) at Dec. 31, 2021 | 447,282 | |||||
Balance at Dec. 31, 2022 | $ 37,656 | $ 480 | 806,488 | (678) | (808,866) | (2,576) |
Balance (in shares) at Dec. 31, 2022 | 479,637 | |||||
Balance at Jun. 30, 2022 | $ 465 | 776,640 | (1,128) | (760,036) | 15,941 | |
Balance (in shares) at Jun. 30, 2022 | 465,326 | |||||
Changes in Stockholders' Equity (Deficit) | ||||||
Issuance of common stock, net of issuance costs | $ 12 | 26,427 | 26,439 | |||
Issuance of common stock, net of issuance costs (in shares) | 12,084 | |||||
Exercise of stock options and warrants | $ 1 | 711 | 712 | |||
Exercise of stock options and warrants (in shares) | 681 | |||||
Issued common stock for vested RSUs and ESPP purchase | 69 | 69 | ||||
Issued common stock for vested RSUs and ESPP purchase (in shares) | 121 | |||||
Stock-based compensation expense | 2,222 | 2,222 | ||||
Net (loss) income | (60,391) | (60,391) | ||||
Other comprehensive (loss) income, net of tax | (57) | (57) | ||||
Balance at Sep. 30, 2022 | $ 478 | 806,069 | (1,185) | (820,427) | (15,065) | |
Balance (in shares) at Sep. 30, 2022 | 478,212 | |||||
Balance at Dec. 31, 2022 | 37,656 | $ 480 | 806,488 | (678) | (808,866) | (2,576) |
Balance (in shares) at Dec. 31, 2022 | 479,637 | |||||
Changes in Stockholders' Equity (Deficit) | ||||||
Issuance of common stock, net of issuance costs | $ 10 | 7,366 | 7,376 | |||
Issuance of common stock, net of issuance costs (in shares) | 9,945 | |||||
Issuance of warrants, net of issuance costs | 63,645 | 63,645 | ||||
Exercise of stock options and warrants | 3 | 3 | ||||
Exercise of stock options and warrants (in shares) | 6 | |||||
Exchange of 2025 Notes | $ 35 | 20,967 | 21,002 | |||
Exchange in 2025 Notes (in shares) | 35,139 | |||||
Issued common stock for vested RSUs and ESPP purchase | $ 6 | 199 | 205 | |||
Issued common stock for vested RSUs and ESPP purchase (in shares) | 5,581 | |||||
Stock-based compensation expense | 6,735 | 6,735 | ||||
Shares withheld related to net share settlement of equity awards | $ (2) | (1,601) | (1,603) | |||
Shares withheld related to net share settlement of equity awards (in shares) | (2,132) | |||||
Other | (137) | (137) | ||||
Net (loss) income | (43,202) | (43,202) | ||||
Other comprehensive (loss) income, net of tax | 619 | 619 | ||||
Balance at Sep. 30, 2023 | 37,656 | $ 528 | 903,665 | (59) | (852,069) | 52,065 |
Balance (in shares) at Sep. 30, 2023 | 528,176 | |||||
Balance at Jun. 30, 2023 | 37,656 | $ 493 | 880,129 | (120) | (827,965) | 52,537 |
Balance (in shares) at Jun. 30, 2023 | 492,827 | |||||
Changes in Stockholders' Equity (Deficit) | ||||||
Warrant issuance costs | 363 | 363 | ||||
Exercise of stock options and warrants | 5 | 5 | ||||
Exchange of 2025 Notes | $ 35 | 20,967 | 21,002 | |||
Exchange in 2025 Notes (in shares) | 35,139 | |||||
Issued common stock for vested RSUs and ESPP purchase | $ 1 | 117 | 118 | |||
Issued common stock for vested RSUs and ESPP purchase (in shares) | 210 | |||||
Stock-based compensation expense | 2,084 | 2,084 | ||||
Net (loss) income | (24,103) | (24,103) | ||||
Other comprehensive (loss) income, net of tax | 61 | 61 | ||||
Balance at Sep. 30, 2023 | $ 37,656 | $ 528 | $ 903,665 | $ (59) | $ (852,069) | $ 52,065 |
Balance (in shares) at Sep. 30, 2023 | 528,176 |
Unaudited Condensed Consolida_3
Unaudited Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Cash flows from operating activities | ||
Net (loss) income | $ (43,202) | $ 130,558 |
Adjustments to reconcile net (loss) income to net cash used in operating activities: | ||
Depreciation and amortization expense | 641 | 751 |
Non-cash interest expense (debt discount and deferred costs) | 6,581 | 8,858 |
Net amortization of premiums and accretion of discounts on marketable securities | (2,253) | |
Gain on change in fair value of derivatives | (6,505) | (152,169) |
Gain on fair value adjustment of option | (41,333) | |
Exchange related (gain) loss, net | (14,207) | |
Impairment of option, net | 138 | |
Stock-based compensation expense | 6,735 | 6,543 |
Provision for inventory obsolescence and net realizable value | 89 | |
Loss on disposal of assets | 5 | |
Other | 56 | |
Changes in assets and liabilities: | ||
Accounts receivable | (998) | (151) |
Prepaid expenses and other current assets | (129) | 504 |
Inventory | (2,509) | (941) |
Deposits and other assets | (342) | 163 |
Accounts payable | 669 | (519) |
Accrued expenses and other liabilities | 1,161 | (1,070) |
Accrued interest | (292) | (257) |
Operating lease liabilities | (596) | |
Net cash used in operating activities | (55,096) | (48,925) |
Cash flows from investing activities | ||
Capital expenditures | (180) | (255) |
Purchase of marketable securities | (68,537) | (82,807) |
Proceeds from sale and maturity of marketable securities | 122,235 | 102,594 |
Net cash provided by investing activities | 53,518 | 19,532 |
Cash flows from financing activities | ||
Issuance of common stock, net of issuance costs | 7,376 | 34,443 |
Issuance of stock options, net of issuance costs | 71 | 1,083 |
Taxes paid related to net share settlement of equity awards | (1,603) | (1,184) |
Repayment of term loans | (2,926) | |
Proceeds from issuance of Loan and Security Agreement, net | 24,446 | |
Payment of debt issuance costs | (244) | |
Proceeds from issuance of warrants, net | 14,698 | |
Net cash provided by financing activities | 21,544 | 31,416 |
Net increase in cash, cash equivalents | 19,966 | 2,023 |
Cash, cash equivalents, at beginning of period | 35,793 | 33,461 |
Cash, cash equivalents, at ending of period | 55,759 | 35,484 |
Supplemental disclosure of cash flow information | ||
Cash paid during the period for interest | 3,100 | 5,137 |
Lease liabilities arising from obtaining right-of-use assets | 3,831 | $ 2,944 |
Supplemental disclosure of non-cash investing and financing activities | ||
Issuance of warrants in exchange for PHC Notes | 48,564 | |
Issuance of warrants for Loan and Security Agreement | 364 | |
Issuance of common stock converted from 2025 Notes | 21,002 | |
2023 Notes | ||
Cash flows from financing activities | ||
Repayment of Notes | (15,700) | |
2025 Notes | ||
Cash flows from financing activities | ||
Repayment of Notes | $ (7,500) |
Organization and Nature of Oper
Organization and Nature of Operations | 9 Months Ended |
Sep. 30, 2023 | |
Organization and Nature of Operations | |
Organization and Nature of Operations | 1. Organization and Nature of Operations Senseonics Holdings, Inc., a Delaware corporation, is a medical technology company focused on the development and manufacturing of long-term, implantable continuous glucose monitoring (“CGM”) systems to improve the lives of people with diabetes by enhancing their ability to manage their disease with relative ease and accuracy. Senseonics, Incorporated is a wholly owned subsidiary of Senseonics Holdings, Inc. and was originally incorporated on October 30, 1996 and commenced operations on January 15, 1997. Senseonics Holdings, Inc. and Senseonics, Incorporated are hereinafter collectively referred to as the “Company” unless otherwise indicated or the context otherwise requires. |
Liquidity and Capital Resources
Liquidity and Capital Resources | 9 Months Ended |
Sep. 30, 2023 | |
Liquidity and Capital Resources | |
Liquidity and Capital Resources | 2. Liquidity and Capital Resources From its founding in 1996 until 2010, the Company has devoted substantially all of its resources to researching various sensor technologies and platforms. Beginning in 2010, the Company narrowed its focus to developing and refining a commercially viable glucose monitoring system. The Company has incurred substantial losses and cumulative negative cash flows from operations since its inception in October 1996 and expects to incur additional losses in the near future. We incurred total gross profit (loss) of $2.7 million, ($0.8) million, and ($17.4) million for the years ended December 31, 2022, 2021 and 2020, respectively. For the three months ending September 30, 2023, the Company had gross profit of $1.2 million and an accumulated deficit of $852.1 million. To date, the Company has funded its operations principally through the issuance of preferred stock, common stock, warrants, convertible notes and debt. As of September 30, 2023, the Company had cash, cash equivalents and marketable securities of $125.4 On September 8, 2023 (the “Effective Date”), the Company entered into a Loan and Security Agreement (the “Loan Agreement”) with the several institutions or entities party thereto (collectively, the “Lenders") and Hercules Capital, Inc., a Maryland corporation (“Hercules”) in its capacity as administrative agent and collateral agent for itself and the Lenders, pursuant to which the Lenders have agreed to make available to the Company up to $50.0 million in senior secured term loans (the “Term Loan Facility”), consisting of (i) an initial term loan of $25.0 million (the “Tranche 1 Loan”), which was funded on the Effective Date and (ii) two additional tranches of term loans in the amounts of up to $10.0 million (the “Tranche 2 Loan”) and $15.0 million (the “Tranche 3 Loan”), respectively, which will become available to the Company upon the Company’s satisfaction of certain terms and conditions set forth in the Loan Agreement. The loans under the Loan Agreement mature on September 1, 2027 (the “Maturity Date”). On August 10, 2023, the Company entered into separate, privately negotiated exchange agreements (the “Exchange Agreements”) with a limited number of holders (the “Noteholders”) of the Company’s currently outstanding 5.25% Convertible Senior Notes due 2025 (the “2025 Notes”). Under the terms of the Exchange Agreements, the Noteholders agreed to exchange with the Company (the “Exchanges”) up to $30.8 million in aggregate principal amount of the 2025 Notes (the “Exchanged Notes”) for a combination of $7.5 million of cash and newly issued shares of common stock (the “Exchange Shares”). The number of Exchange Shares was determined based upon the volume-weighted average price per share of the common stock during a 15-day averaging period commencing on August 11, 2023 and ending August 31, 2023. Based on the volume-weighted average price per share of the common stock during the averaging period, a total of 35.1 million shares of common stock were issued in the Exchanges. The Exchanges were settled on the initial share issuance date of August 14, 2023 and the final settlement date of September 5, 2023. In August 2023, the Company entered into an Equity Distribution Agreement (the “Equity Distribution Agreement”) with Goldman Sachs & Co. LLC (“GS”), under which the Company could offer and sell, from time to time, at its sole discretion, shares of its common stock having an aggregate offering price of up to $106.6 million through GS as its sales agent in an “at the market” offering. GS will receive a commission up to 3.0% of the gross proceeds of any common stock sold through GS under the Equity Distribution Agreement. The shares will be offered and sold pursuant to an effective shelf registration statement on Form S-3, which was originally filed with the Securities and Exchange Commission on August 10, 2023. As of September 30, 2023, no sales have been made under the Equity Distribution Agreement. In November 2021, the Company entered into an Open Market Sale Agreement, (the “2021 Sales Agreement”) with Jefferies LLC (“Jefferies”), under which the Company could offer and sell, from time to time, at its sole discretion, shares of its common stock having an aggregate offering price of up to $150.0 million through Jefferies as its sales agent in an “at the market” offering. Jefferies received commissions up to 3.0% of the gross proceeds of any common stock sold through Jefferies under the 2021 Sales Agreement. During 2023, the Company received $7.4 million in net proceeds from the sale of 9,944,663 shares of its common stock under the 2021 Sales Agreement. For the nine months ended September 30, 2022, the Company received $34.4 million in net proceeds from the sale of 15,160,899 shares of its common stock under the 2021 Sales Agreement. Effective August 7, 2023, the Company and Jefferies mutually agreed to terminate the 2021 Sales Agreement. At the time of termination, approximately $106.6 million remained available for issuance pursuant to the 2021 Sales Agreement. On November 9, 2020, the Company entered into an Equity Line Agreement (the “Equity Line Agreement”) with Energy Capital, LLC, a Florida limited liability company (“Energy Capital”), which provided that, upon the terms and subject to the conditions and limitations set forth therein, Energy Capital was committed to purchase up to an aggregate of $12.0 million of shares of the Company’s newly designated series B convertible preferred stock (the “Series B Preferred Stock”) at the Company’s request from time to time during the 24-month term of the Equity Line Agreement. Under the Equity Line Agreement, beginning January 21, 2021, subject to the satisfaction of certain conditions, the Company had the right, at its sole discretion, to present Energy Capital with a purchase notice (each, a “Regular Purchase Notice”) directing Energy Capital (as principal) to purchase shares of Series B Preferred Stock at a price of $1,000 per share (not to exceed $4.0 million worth of shares) once per month, up to an aggregate of $12.0 million of the Company’s Series B Preferred Stock at a per share price (the “Purchase Price”) equal to $1,000 per share of Series B Preferred Stock, with each share of Series B Preferred Stock initially convertible into common stock, beginning six months after the date of its issuance, at a conversion price of $0.3951 per share, subject to customary anti-dilution adjustments, including in the event of any stock split. The Equity Line Agreement provided that the Company was not permitted to affect any Regular Purchase Notice under the Equity Line Agreement on any date where the closing price of the Company’s common stock on the NYSE American is less than $0.25 without the approval of Energy Capital. In addition, beginning on January 1, 2022, since there had been no sales of the Series B Preferred Stock pursuant to the Equity Line Agreement, Energy Capital had the right, at its sole discretion, by its delivery to the Company of a Regular Purchase Notice, to purchase up to the $12.0 million of Series B Preferred Stock under the Equity Line Agreement at the Purchase Price. On November 7, 2022, Energy Capital exercised in full its right to purchase $12.0 million of Series B Preferred Stock. The excess of the Purchase Price and the fair value of the Energy Capital option in the total amount of $37.6 million was recorded in additional-paid-in-capital as convertible preferred stock. On August 9, 2020, the Company entered into a financing agreement with the parent company of Ascensia Diabetes Care Holdings AG (“Ascensia”), PHC Holdings Corporation (“PHC”), pursuant to which the Company issued $35.0 million in aggregate principal amount of Senior Secured Convertible Notes due on October 31, 2024 (the “PHC Notes”), to PHC. The Company also issued 2,941,176 shares of common stock to PHC as a financing fee. The Company also has the option to sell and issue PHC up to $15.0 million of convertible preferred stock on or before December 31, 2022, contingent upon obtaining U.S. Food and Drug Administration (“FDA”) approval for the 180-day Eversense product for marketing in the United States before such date. The Company successfully obtained FDA approval in February 2022 and the option was not exercised. As described in Note 12, on March 13, 2023, the Company entered into an Exchange Agreement (the “PHC Exchange Agreement”) with PHC, pursuant to which PHC agreed to exchange (the “PHC Exchange”) its $35.0 million aggregate principal amount of the PHC Notes, including all accrued and unpaid interest thereon, for a warrant (the “PHC Exchange Warrant”) to purchase up to 68,525,311 shares of the Company’s common stock, $0.001 par value per share (the “PHC Exchange Warrant Shares”). The PHC Exchange Warrant is a “pre-funded” warrant with a nominal exercise price of $0.001 per PHC Exchange Warrant Share. On March 31, 2023, the PHC Exchange was consummated, and the Company issued the PHC Exchange Warrant in consideration for the cancellation of the PHC Notes. On March 13, 2023, the Company entered into a securities purchase agreement (the “Securities Purchase Agreement”) with PHC, pursuant to which the Company issued and sold to PHC in a private placement (the “Private Placement”) a warrant (the “Purchase Warrant”) to purchase 15,425,750 shares of the Company’s common stock, $0.001 par value per share (the “Purchase Warrant Shares”). The purchase price of the Purchase Warrant was approximately $0.97 per Purchase Warrant Share, representing the undiscounted, trailing 10-day volume weighted average price of the Company’s common stock through March 10, 2023. The Purchase Warrant is a “pre-funded” warrant with a nominal exercise price of $0.001 per Purchase Warrant Share. The issuance of the Purchase Warrants enabled PHC to maintain, as of the closing of the transaction, a 15% beneficial ownership for purposes of the Investor Rights Agreement, dated August 9, 2020, between the Company and PHC. The Private Placement closed on March 13, 2023 (the “Private Placement Closing Date”) and the Company received aggregate gross proceeds of $15.0 million, before deducting private placement expenses payable by the Company. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2023 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | 3. Summary of Significant Accounting Policies Basis of Presentation The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and the instructions to Quarterly Report on Form 10-Q and Article 10 of Regulation S-X. Although the Company considers the disclosures in these unaudited consolidated financial statements to be adequate to make the information presented not misleading, certain information or footnote information normally included in consolidated financial statements prepared in accordance with U.S. GAAP have been condensed or omitted as permitted under the rules and regulations of the SEC. In the opinion of management, all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair statement of financial position at September 30, 2023, and December 31, 2022, results of operations, comprehensive income (loss), and changes in stockholder’s deficit for the three and nine months ended September 30, 2023 and 2022 and cash flows for the nine months ended September 30, 2023 and 2022 have been included. The unaudited condensed consolidated financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, as filed with the SEC on March 16, 2023. The interim results for September 30, 2023 are not necessarily indicative of the results to be expected for the year ending December 31, 2023, or for any future interim periods. The consolidated financial statements reflect the accounts of Senseonics Holdings, Inc. and its wholly owned operating subsidiary Senseonics, Incorporated. The Company views its operations and manages its business in one segment, glucose monitoring products. Operating segments are defined as components of an enterprise about which separate discrete information is available for evaluation by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance. Recent Accounting Pronouncements In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses: Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”) Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the reported amounts of revenue and expenses during the reporting period. In the accompanying unaudited consolidated financial statements, estimates are used for, but not limited to, stock-based compensation, recoverability of long-lived assets, deferred taxes and valuation allowances, fair value of investments, derivative assets and liabilities, obsolete inventory, warranty obligations, variable consideration related to revenue, allowance for credit losses, depreciable lives of property and equipment, and accruals for clinical study costs, which are accrued based on estimates of work performed under contract. The Company bases these estimates on historical and anticipated results, trends, and various other assumptions that it believes are reasonable, including assumptions as to future events. These estimates form the basis for making judgments about the carrying values of assets and liabilities and recorded revenues and expenses. Actual results could differ from those estimates; however, management does not believe that such differences would be material. Significant Accounting Policies The accounting policies used by the Company in its presentation of interim financial results are consistent with those presented in Note 3 to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022. |
Revenue Recognition
Revenue Recognition | 9 Months Ended |
Sep. 30, 2023 | |
Revenue Recognition | |
Revenue Recognition | 4. Revenue Recognition The Company generates product revenue from sales of the Eversense system and related components and supplies to Ascensia, through a collaboration and commercialization agreement (the “Ascensia Commercialization Agreement”), third-party distributors in the European Union and to strategic fulfillment partners in the United States (collectively, the “Customers”), who then resell the products to health care providers and patients. Customers pay the Company for sales, regardless of whether or not the Customers resell the products to health care providers and patients. The Company’s policies for recognizing sales have not changed from those described in our Annual Report on Form 10-K for the year ended December 31, 2022. Revenue by Geographic Region The following table sets forth net revenue derived from the Company’s two primary geographical markets, the United States and outside of the United States, based on the geographic location to which the Company delivers the product, for the three and nine months ended September 30, 2023 and 2022: Three Months Ended Nine Months Ended September 30, 2023 September 30, 2023 % % (Dollars in thousands) Amount of Total Amount of Total Revenue, net: United States $ 3,930 64.5 % $ 7,885 54.9 % Outside of the United States 2,167 35.5 6,475 45.1 Total $ 6,097 100.0 % $ 14,360 100.0 % Three Months Ended Nine Months Ended September 30, 2022 September 30, 2022 % % (Dollars in thousands) Amount of Total Amount of Total Revenue, net: United States $ 1,934 41.8 % $ 3,908 36.1 % Outside of the United States 2,688 58.2 6,910 63.9 Total $ 4,622 100.0 % $ 10,818 100.0 % Contract Assets Contract assets consist of unbilled receivables from customers and are recorded at net realizable value and relate to the revenue share variable consideration from the Ascensia Commercialization Agreement. Accounts receivable – related parties, net as of September 30, 2023 and December 31, 2022 included unbilled accounts receivable of $1.3 million and $1.7 million, respectively. The Company expects to invoice and collect all unbilled accounts receivable within 12 months. Concentration of Revenue and Customers For the three months ended September 30, 2023 and 2022, the Company derived 93% and 97%, respectively, of its total revenue from one customer, Ascensia. For the nine months ended September 30, 2023 and 2022, the Company derived 92% and 95%, respectively of its total revenue from one customer, Ascensia. Revenues for these corresponding periods represent sales of sensors, transmitters and miscellaneous Eversense system components. |
Net Income (Loss) per Share
Net Income (Loss) per Share | 9 Months Ended |
Sep. 30, 2023 | |
Net Income (Loss) per Share | |
Net Income (Loss) per Share | 5. Net Income (Loss) per Share Basic net income (loss) per share attributable to common stockholders is calculated by dividing the net income (loss) attributable to common stockholders by the weighted-average number of common shares outstanding during the period. An aggregate of 83,951,061 Since the shares are issuable for little or no consideration, sometimes referred to as “penny warrants”, they are considered outstanding in the context of earnings per share, as discussed in ASC 260-10-45-13. Dilutive net income (loss) per share is computed using the weighted average number of common shares outstanding during the period and, when dilutive, potential common share equivalents. Potentially dilutive common shares consist of shares issuable from restricted stock units, stock options, warrants and the Company’s convertible notes. Potentially dilutive common shares issuable upon vesting of restricted stock units and exercise of stock options and warrants are determined using the average share price for each period under the treasury stock method. Potentially dilutive common shares issuable upon conversion of the Company’s convertible notes are determined using the if converted method. The if-converted method assumes conversion of convertible securities at the beginning of the reporting period. Interest expense, dividends, and the changes in fair value measurement recognized during the period are added back to the numerator. The denominator includes the common shares issuable upon conversion of convertible securities. In periods of net loss, all potentially dilutive common shares are excluded from the computation of the diluted net loss per share for those periods, as the effect would be anti-dilutive. The following table sets forth the computation of basic and diluted net income (loss) per share for the periods shown: Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Net (loss) income $ (24,103) $ (60,391) $ (43,202) $ 130,558 Impact of conversion of dilutive securities — — — (188,563) Dilutive Net loss $ (24,103) $ (60,391) $ (43,202) $ (58,005) Net (loss) income per share Basic $ (0.04) $ (0.13) $ (0.08) $ 0.28 Diluted $ (0.04) $ (0.13) $ (0.08) $ (0.10) Basic weighted average shares outstanding 592,452,262 472,475,747 552,703,546 464,244,736 Dilutive potential common stock outstanding Stock-based awards — — — 6,499,671 2023 Notes — — — 4,617,646 2025 Notes — — — 39,211,358 PHC Notes — — — 67,625,174 Energy Capital Option — — — 23,335,635 Warrants — — — 2,811,493 Diluted weighted average shares outstanding 592,452,262 472,475,747 552,703,546 608,345,713 Outstanding anti-dilutive securities not included in the diluted net income (loss) per share calculations were as follows: Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Stock-based awards 31,953,024 24,940,972 31,953,024 10,426,560 2023 Notes — 4,617,646 — — 2025 Notes 15,622,814 39,211,358 15,622,814 — PHC Notes — 68,322,952 — — PHC Option — 31,512,605 — 22,717,076 Energy Capital Option — 30,372,058 — — Energy Capital Preferred Shares 30,372,058 — 30,372,058 — Warrants 1,260,183 3,177,821 1,260,183 427,821 Total anti-dilutive shares outstanding 79,208,079 202,155,412 79,208,079 33,571,457 |
Marketable Securities
Marketable Securities | 9 Months Ended |
Sep. 30, 2023 | |
Marketable Securities. | |
Marketable Securities | 6. Marketable Securities Marketable securities available for sale, were as follows (in thousands): September 30, 2023 Gross Gross Estimated Amortized Unrealized Unrealized Market Cost Gains Losses Value Commercial Paper $ 26,281 $ — $ — $ 26,281 Corporate debt securities 7,944 — (24) 7,920 Asset backed securities — — — — Government and agency securities 35,482 — (35) 35,447 Total $ 69,707 $ — $ (59) $ 69,648 December 31, 2022 Gross Gross Estimated Amortized Unrealized Unrealized Market Cost Gains Losses Value Commercial Paper $ 41,503 $ — $ — $ 41,503 Corporate debt securities 32,331 — (189) 32,142 Asset backed securities 8,363 — (103) 8,260 Government and agency securities 38,956 — (386) 38,570 Total $ 121,153 $ — $ (678) $ 120,475 The following are the scheduled maturities as of September 30, 2023 (in thousands): Net Fair Carrying Amount Value 2023 (remaining three months) $ 36,156 $ 39,231 2024 33,551 30,417 Total $ 69,707 $ 69,648 The Company periodically reviews its portfolio of debt securities to determine if any investment is impaired due to credit loss or other potential valuation concerns. For debt securities where the fair value of the investment is less than the amortized cost basis, the Company assesses at the individual security level, for various quantitative factors including, but not limited to, the nature of the investments, changes in credit ratings, interest rate fluctuations, industry analyst reports, and the severity of impairment. Unrealized losses on available-for-sale securities at September 30, 2023 were not significant and were primarily due to changes in interest rates and not due to increased credit risk associated with specific securities. The Company does not intend to sell these impaired investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost bases, which may be at maturity. |
Inventory, net
Inventory, net | 9 Months Ended |
Sep. 30, 2023 | |
Inventory, net | |
Inventory, net | 7. Inventory, net Inventory, net of reserves, consisted of the following (in thousands): September 30, December 31, 2023 2022 Finished goods $ 2,440 $ 1,697 Work-in-process 5,981 4,057 Raw materials 1,305 1,552 Total $ 9,726 $ 7,306 The Company charged less than $0.1 million |
Prepaid Expenses and Other Curr
Prepaid Expenses and Other Current Assets | 9 Months Ended |
Sep. 30, 2023 | |
Prepaid Expenses and Other Current Assets | |
Prepaid Expenses and Other Current Assets | 8 . Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consisted of the following (in thousands): September 30, December 31, 2023 2022 Contract manufacturing⁽¹⁾ $ 4,577 $ 4,097 Tax credits receivable (2) 1,793 — Insurance 340 1,243 Clinical and Preclinical 180 924 Interest receivable 218 336 Rent and utilities 151 132 Research and development 135 67 Accounting and Audit 117 270 Other 46 359 Total prepaid expenses and other current assets $ 7,557 $ 7,428 (1) Includes deposits to contract manufacturers for manufacturing process. (2) Refundable employee retention credits, enacted under the CARES Act. |
Accrued Expenses and Other Curr
Accrued Expenses and Other Current Liabilities | 9 Months Ended |
Sep. 30, 2023 | |
Accrued Expenses and Other Current Liabilities | |
Accrued Expenses and Other Current Liabilities | 9. Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consisted of the following (in thousands): September 30, December 31, 2023 2022 Research and development $ 4,168 $ 3,502 Professional and administrative services 3,947 1,053 Compensation and benefits 3,569 4,699 Contract manufacturing 1,396 2,480 Product warranty and replacement obligations 517 781 Operating lease 413 725 Interest on notes payable 381 149 Sales and marketing services 242 2,050 Other — 14 Total accrued expenses and other current liabilities $ 14,633 $ 15,453 |
Leases
Leases | 9 Months Ended |
Sep. 30, 2023 | |
Leases | |
Leases | 10. Leases The Company leases approximately 33,000 square feet of research and office space for its corporate headquarters under a non-cancelable operating lease. In May 2023, the Company amended our lease, extending the lease term through May 31, 2033, and obtained a tenant improvement allowance of $1.3 million. The Company accounted for the amendment as a lease modification and remeasured the ROU asset and lease liability as of the amendment date, which resulted in an increase of $2.5 million to the ROU asset, and an increase of $3.8 million to the lease liability. The Company has one option to extend the term for an additional period of five years beginning on June 1, 2033. The rent expense is recognized on a straight-line basis through the end of the lease term, excluding option renewals. The difference between the straight-line rent amounts and amounts payable under the lease is recorded as deferred rent. Operating lease expense for the nine months ended September 30, 2023 and 2022 was $0.6 million and $0.5 million, respectively. The following table summarizes the lease assets and liabilities as of September 30, 2023 and December 31, 2022 (in thousands): September 30, December 31, Operating Lease Assets and Liabilities Balance Sheet Classification 2023 2022 Assets Operating lease ROU assets Deposits and other assets $ 5,261 $ 3,032 Tenant improvement allowance receivable Deposits and other assets 1,312 — Liabilities Current operating lease liabilities Accrued expenses and other current liabilities $ 413 $ 725 Non-current operating lease liabilities Other non-current liabilities 6,312 2,689 Total operating lease liabilities $ 6,725 $ 3,414 The following table summarizes the maturity of undiscounted payments due under operating lease liabilities and the present value of those liabilities as of September 30, 2023 (in thousands): 2023 (remaining 3 months) $ 283 2024 912 2025 939 2026 967 2027 996 Thereafter 5,934 Total 10,031 Less: Present value adjustment (3,306) Present value of lease liabilities $ 6,725 The following table summarizes the weighted-average lease term and weighted-average discount rate as of September 30, 2023: Remaining lease term (years) 2023 Operating leases 9.6 Discount rate Operating leases 8.5 % |
Product Warranty Obligations
Product Warranty Obligations | 9 Months Ended |
Sep. 30, 2023 | |
Product Warranty Obligations | |
Product Warranty Obligations | 11. Product Warranty Obligations The Company provides a warranty of one year on its smart transmitters. Additionally, the Company may also replace Eversense system components that do not function in accordance with the product specifications. Estimated replacement costs are recorded at the time of shipment as a charge to cost of sales in the consolidated statement of operations and are developed by analyzing product performance data and historical replacement experience, including comparing actual replacements to revenue. At each September 30, 2023 and December 31, 2022, the warranty reserve was $0.5 million and $0.8 million, respectively. The following table provides a reconciliation of the change in estimated warranty liabilities for the nine months ended September 30, 2023, and for the twelve months ended December 31, 2022 (in thousands): September 30, December 31, 2023 2022 Balance at beginning of the period $ 781 $ 723 Provision for warranties during the period 136 166 Settlements made during the period (400) (108) Balance at end of the period $ 517 $ 781 |
Notes Payable, Preferred Stock
Notes Payable, Preferred Stock and Stock Purchase Warrants | 9 Months Ended |
Sep. 30, 2023 | |
Notes Payable, Preferred Stock and Stock Purchase Warrants | |
Notes Payable, Preferred Stock and Stock Purchase Warrants | 12. Notes Payable, Preferred Stock and Stock Purchase Warrants Term Loans Loan and Security Agreement On September 8, 2023 (the “Effective Date”), the Company entered into a Loan and Security Agreement (the “Loan Agreement”) with Hercules Capital, Inc. and its managed fund (collectively, the “Lenders"), pursuant to which the Lenders have agreed to make available to Senseonics up to $50.0 million in senior secured term loans (the “Term Loan Facility”), consisting of (i) an initial term loan of $25.0 million (the “Tranche 1 Loan”), which was funded on the Effective Date and (ii) two additional tranches of term loans in the amounts of up to $10.0 million (the “Tranche 2 Loan”) and $15.0 million (the “Tranche 3 Loan”), respectively, which will become available to Senseonics upon Senseonics’ satisfaction of certain terms and conditions set forth in the Loan Agreement. The loans under the Loan Agreement mature on September 1, 2027 (the “Maturity Date”). The loans under the Loan Agreement bear interest at an annual rate equal to the greater of (i) the prime rate as reported in The Wall Street Journal plus At the Company’s option, the Company may prepay all or any portion of the outstanding borrowings under the Loan Agreement, subject to a prepayment fee equal to (a) 3.0% of the principal amount being prepaid if the prepayment occurs within one year of the Effective Date, 2.0% of the principal amount being prepaid if the prepayment occurs during the second year following the Effective Date, and 1.00% of the principal amount being prepaid if the prepayment occurs more than two years after the Effective Date and prior to the Maturity Date. In addition, the Company paid a $375,000 facility fee upon closing and will pay additional facility charges in connection with any borrowing of the Tranche 2 Loan or Tranche 3 Loan, in each case in the amount of 0.50% of the amount of such tranche of loans. The Loan Agreement also provides for an end of term fee in an amount equal to 6.95% of the aggregate principal amount of loan advances actually made under the Loan Agreement, which fee is due and payable on the earliest to occur of (i) the Maturity Date, (ii) the date the Company prepays the outstanding loans in full, and (iii) the date that the secured obligations become due and payable. The end of term fee is accreted to interest expense over the term of the loans. The Company’s obligations under the Loan Agreement are secured, by a first-priority security interest in substantially all of its assets. The Loan Agreement contains a minimum cash covenant that requires the Company to hold unrestricted cash equal to 30% of the outstanding loan amount under the Loan Agreement. The Loan Agreement also contains a performance covenant, commencing on July 1, 2024, that requires the Company to generate net product revenue on a trailing six-month basis in excess of specified percentage for applicable measuring periods, subject to certain exceptions. In addition, the Loan Agreement contains customary representations and warranties and customary affirmative and negative covenants, including, among other things, restrictions on indebtedness, liens, investments, mergers, corporate changes, dispositions, prepayment of other indebtedness, and dividends and other distributions, subject to certain exceptions. The Loan Agreement also contains events of default including, among other things, payment defaults, breach of covenants, material adverse effect, breach of representations and warranties, cross-default to material indebtedness, bankruptcy-related defaults, judgment defaults, revocation of certain government approvals, and the occurrence of certain adverse events. Following an event of default and any applicable cure period, a default interest rate equal to the then-applicable interest rate plus 4.0% may be applied to the outstanding amount, and the Lenders will have the right to accelerate all amounts outstanding under the Loan Agreement, in addition to other remedies available to them as secured creditors of the Company. In addition, in connection with the issuance of the Tranche 1 Loan, the Company issued warrants to the Lenders (collectively, the “Warrants”) to acquire an aggregate of 832,362 shares of the Company’s common stock at an exercise price of $0.6007 per share (the “Warrant Shares”). The Warrants may be exercised through the earlier of (i) the seventh anniversary of the Effective Date and (ii) the consummation of certain acquisition transactions involving the Company, as set forth in the Warrants. The number of Warrant Shares for which the Warrants are exercisable and the associated exercise price are subject to certain customary proportional adjustments for fundamental events, including stock splits and reverse stock splits, as set forth in the Warrants. The proceeds from the Loan Agreement were allocated between the Tranche 1 Loan and the Warrants based on their respective fair value of $25.0 million and $0.4 million, and the amount allocated to the Warrants was recorded in equity resulting in a debt discount to the Tranche 1 Loan that is being amortized as additional interest expense over the term of the loan agreement using the effective interest method. In connection with Loan Agreement, the Company incurred $1.1 million in debt issuance costs and debt discounts which are netted against the principal balance of the initial term loan and amortized as interest expense over the term of the initial term loan using an effective interest rate of 13.01% . Pursuant to the Loan Agreement, the Company also agreed to issue additional seven year term warrants upon the funding of the Tranche 2 and Tranche 3 Loans, which warrants would be exercisable for an aggregate number of shares equal to 2.0% of the funded loan amount divided by the exercise price equal to the three-day volume-weighted average price at the time of each advance. PPP Loan On April 22, 2020, the Company received $5.8 million in loan funding from the PPP pursuant to the CARES Act, as amended by the Flexibility Act, and administered by the Small Business Administration (“SBA”). The unsecured loan (the “PPP Loan”) was evidenced by the PPP Note dated April 21, 2020 (the “PPP Note”) in the principal amount of $5.8 million with Silicon Valley Bank (“SVB”). Under the terms of the PPP Note and the PPP Loan, interest accrued on the outstanding principal at a rate of 1.0% per annum. The term of the PPP Note was two years . In April 2022, the Company repaid the outstanding principal and accrued interest in full. Convertible Preferred Stock and Warrants Equity Line Agreement On November 9, 2020, the Company entered into the Equity Line Agreement with Energy Capital, which provided that, upon the terms and subject to the conditions and limitations set forth therein, Energy Capital was committed to purchase up to an aggregate of $12.0 million of shares of the Company’s Series B Preferred Stock at the Company’s request from time to time during the 24-month term of the Equity Line Agreement. Under the Equity Line Agreement, beginning January 21, 2021, subject to the satisfaction of certain conditions, the Company had the right, at sole discretion, to present Energy Capital with a Regular Purchase Notice directing Energy Capital (as principal) to purchase shares of Series B Preferred Stock at a price of $1,000 per share (not to exceed $4.0 million worth of shares) once per month, up to an aggregate of $12.0 million of the Company’s Series B Preferred Stock at the Purchase Price equal to $1,000 per share of Series B Preferred Stock, with each share of Series B Preferred Stock initially convertible into common stock, beginning six months after the date of its issuance, at a conversion price of $0.3951 per share, subject to customary anti-dilution adjustments, including in the event of any stock split. The Equity Line Agreement provided that the Company shall not affect any Regular Purchase Notice under the Equity Line Agreement on any date where the closing price of the Company’s common stock on the NYSE American is less than $0.25 without the approval of Energy Capital. The Company accounted for the Equity Line Agreement as a put/call option (the “Energy Capital Option”). This put/call option was classified as a liability in accordance with ASC 480, Distinguishing liabilities from equity, on the Company’s balance sheet and was recorded at the estimated fair value of $4.2 million upon issuance. The put/call option was required to be remeasured to fair value at each reporting period with the change recorded in change in fair value of derivatives that is a component of other income (expense). In connection with the execution of the Equity Line Agreement, the Company incurred $7.6 million in debt issuance costs in fiscal year 2020. The fair value of the Energy Capital Option as of December 31, 2021 was $69.4 million. The Company adjusted the Energy Capital Option to its fair value of $25.7 million on the exercise date, recognizing a fair value adjustment gain of $43.7 million. Concurrently with entry into the Equity Line Agreement, the Company issued a warrant to Energy Capital, exercisable beginning on May 9, 2021, to purchase up to 10,000,000 shares of common stock at an exercise price of $0.3951 per share (the “Energy Capital Warrant”). The Energy Capital Warrant was exercised on a net basis in February 2022 and Energy Capital received 8,917,535 shares of common stock upon the net exercise of the Energy Capital Warrants. Securities Purchase Agreement On March 13, 2023, pursuant to the Securities Purchase Agreement with PHC, the Company issued and sold to PHC in a private placement a warrant (the “Purchase Warrant”) to purchase 15,425,750 shares of common stock (the “Purchase Warrant Shares”). The Purchase Warrant is a “pre-funded” warrant with a nominal exercise price of $0.001 per Purchase Warrant Share. On the private placement closing date, the Company received aggregate gross proceeds of $15.0 million, before deducting private placement expenses payable by the Company. All or any part of the Purchase Warrant shall is exercisable by the holder at any time and from time to time. The Company determined that the Purchase Warrant shall be classified as equity in accordance with ASC Topic 480, Distinguishing Liabilities from Equity and ASC Topic 815. At issuance, the Company recorded the estimated fair value of the Purchase Warrant in the amount of $14.3 million as additional paid-in-capital in the Company’s consolidated balance sheets. Because PHC was an existing stockholder of the Company at the time of the transaction, the $0.7 million excess of the purchase price over the fair value of the Purchase Warrant was recognized as an equity transaction and recorded as a capital contribution made by PHC to the Company as additional paid-in-capital in the Company’s consolidated balance sheets. Additionally, on March 13, 2023, the Company entered into the Exchange Agreement with PHC, pursuant to which PHC agreed to exchange (the “PHC Exchange”) its $35.0 million aggregate principal amount of the PHC Notes, including all accrued and unpaid interest thereon, for a warrant (the “PHC Exchange Warrant”) to purchase up to 68,525,311 shares of common stock (the “PHC Exchange Warrant Shares”). The PHC Exchange Warrant is a “pre-funded” warrant with a nominal exercise price of $0.001 per PHC Exchange Warrant Share. All or any part of the PHC Exchange Warrant is exercisable by the holder at any time and from time to time. The number of PHC Exchange Warrant Shares represents the number of shares of common stock previously issuable upon conversion of the PHC Notes, in accordance with the original terms of the notes, including a number of shares in respect of accrued and unpaid interest through the closing date, plus additional shares with a value of $675,000 reflecting a portion of the future interest payments forgone by PHC. On March 31, 2023 (6:00 am Japan Standard Time on April 1, 2023), the PHC Exchange was consummated, and the Company issued the PHC Exchange Warrant in consideration for the cancellation of the PHC Notes. The Company determined that the PHC Exchange Warrant shall be classified as equity in accordance with ASC 480 and ASC 815. At March 31, 2023, the Company recorded the estimated fair value of the PHC Exchange Warrant in the amount of $48.6 million as additional paid-in-capital in the Company’s consolidated balance sheets. As of September 30, 2023, the Purchase Warrant and the PHC Exchange Warrant remained unexercised and outstanding. As they are prefunded warrants, the Company included the entirety of the warrant shares as weighted average outstanding shares in the calculation of its basic earnings per share. Convertible Notes PHC Notes On August 9, 2020, the Company entered into a Note Purchase Agreement (the “Note Purchase Agreement”) with PHC, as the purchaser (together with the other purchasers from time-to-time party thereto, the “Note Purchasers”) and Alter Domus (US) LLC, as collateral agent. Pursuant to the Note Purchase Agreement, the Company borrowed $35.0 million in aggregate principal through the issuance and sale of the PHC Notes on August 14, 2020 (the “Closing Date”). The Company also issued 2,941,176 shares of its common stock, $0.001 par value per share to PHC as a financing fee (the “Financing Fee Shares”) on the Closing Date. The Financing Fee Shares are accounted for as debt discount in the amount of $1.5 million. The PHC Notes were senior secured obligations of the Company and were guaranteed on a senior secured basis by the Company’s wholly owned subsidiary, Senseonics, Incorporated. Interest at the initial annual rate of 9.5% is payable semi-annually in cash or, at the Company’s option, payment in kind. The interest rate decreased to 8.0% in April 2022 as a result of the Company having obtained FDA approval for the 180-day Eversense E3 system for marketing in the United States. The maturity date for the PHC Notes was October 31, 2024 (the “Maturity Date”). The obligations under the PHC Notes were secured by substantially all of the Company’s and its subsidiary’s assets. The Note Purchasers were entitled to convert the PHC Notes to common stock at a conversion rate of 1,867.4136 shares per $1,000 principal amount of the PHC Notes (including any interest added thereto as payment in kind), equivalent to a conversion price of approximately $0.53 per share, subject to specified anti-dilution adjustments, including adjustments for the Company’s issuance of equity securities on or prior to April 30, 2022 below the conversion price. In addition, following a notice of redemption or certain corporate events that occurred prior to the maturity date, the Company would have been required, in certain circumstances, to increase the conversion rate for a holder electing to convert its PHC Notes in connection with such notice of redemption or corporate event. In certain circumstances, the Company would have been required to pay cash in lieu of delivering make whole shares unless the Company obtained stockholder approval to issue such shares. Subject to specified conditions, on or after October 31, 2022, the PHC Notes would have become redeemable by the Company if the closing sale price of the common stock were to exceed 275% of the conversion price for a specified period of time and subject to certain conditions upon 10 days prior written notice at a cash redemption price equal to the then outstanding principal amount (including any payment in kind interest which has been added to such amount), plus any accrued but unpaid interest. On or after October 31, 2023, the PHC Notes would have become redeemable by the Company upon 10 days prior written notice at a cash redemption price equal to the then outstanding principal amount (including any payment in kind interest which had been added to such amount), plus any accrued but unpaid interest, plus a call premium of 130% if redeemed at least six months prior to the Maturity Date or a call premium of 125% if redeemed within six months of the Maturity Date. The Note Purchase Agreement contained customary terms and covenants, including financial covenants, such as operating within an approved budget and achieving minimum revenue and liquidity targets, and negative covenants, such as limitations on indebtedness, liens, mergers, asset transfers, certain investing activities and other matters customarily restricted in such agreements. Most of these restrictions were subject to certain minimum thresholds and exceptions. The Note Purchase Agreement also contained customary events of default, after which the PHC Notes would have become due and payable immediately, including defaults related to payment compliance, material inaccuracy of representations and warranties, covenant compliance, material adverse changes, bankruptcy and insolvency proceedings, cross defaults to certain other agreements, judgments against the Company, change of control or delisting events, termination of any guaranty, governmental approvals, and lien priority. The Company also had the option to sell and issue PHC up to $15.0 million of convertible preferred stock on or before December 31, 2022 (the “PHC Option”), which was initially contingent upon obtaining FDA approval for the 180-day Eversense product for marketing in the United States before such date, and which approval the Company successfully obtained in February 2022 The Note Purchase Agreement also contained several provisions requiring bifurcation as a separate derivative liability including an embedded conversion feature, mandatory prepayment upon event of default that constitutes a breach of the minimum revenue financial covenant, optional redemption upon an event of default, change in interest rate after PMA approval and default interest upon an event of default. On the date of issuance, the Company recorded the fair value of the embedded features in the amount of $25.8 million as a derivative liability in the Company’s consolidated balance sheets in accordance with ASC 815. The derivative was adjusted to fair value at each reporting period, with the change in the fair value recorded in change in fair value of derivatives that is a component of other income (expense) in the Company’s consolidated statement of operations and comprehensive loss. In connection with the issuance of the PHC Notes, the Company incurred $2.9 million in debt issuance costs and debt discounts. The associated debt issuance costs were recorded as a contra liability in the amount of $1.4 million and were deferred and amortized as additional interest expense over the term of the notes at an effective interest rate of 29.19% . conversions of the PHC Notes prior to the exchange of the PHC Notes for the PHC Exchange Warrant described above. As described above, the PHC Exchange Agreement with PHC was consummated on March 31, 2023, whereby PHC exchanged the PHC Notes in $35.0 million principal amount and all accrued and unpaid interest for the PHC Exchange Warrant. On March 31, 2023, the Company was released from its obligation under the PHC Notes. Upon execution of the PHC Exchange Agreement, the exercise of the original conversion feature of the PHC Notes became remote. Accordingly, the Company remeasured the embedded derivative to its fair value of $0 . The Company recognized a change in fair value of the embedded derivative of $44.2 million in the caption “Exchange related gain (loss), net” that is a component of other income (expense) in the Company’s consolidated statement of operations and comprehensive loss. The Company accounted for the PHC Exchange as an extinguishment of the PHC Notes, and thus, it derecognized the PHC Notes in its consolidated balance sheets and recognized a loss of $25.4 million as the difference between the carrying value plus accrued interest of the PHC Notes of $23.2 million and the $48.6 million fair value of the PHC Exchange Warrant as an extinguishment loss in the caption “Exchange related gain (loss), net” that is a component of other income (expense) in the Company’s consolidated statement of operations and comprehensive loss. As a result of the PHC Exchange, the Company recognized a total net gain on exchange of the PHC notes of $18.8 million representing the gain on change in the fair value of the PHC Notes conversion feature recognized as an embedded derivative and the loss on extinguishment of the PHC Notes in exchange for the PHC Exchange Warrant. 2025 Notes In July 2019, the Company issued $82.0 million in aggregate principal amount of senior convertible notes that will mature on January 15, 2025 (the “2025 Notes”), unless earlier repurchased or converted. The 2025 Notes are convertible, at the option of the holders, into shares of the Company’s common stock, at an initial conversion rate of 757.5758 shares per $1,000 principal amount of the 2025 Notes (equivalent to an initial conversion price of approximately $1.32 per share). The 2025 Notes also contained an embedded conversion option requiring bifurcation as a separate derivative liability, along with the fundamental change make-whole provision and the cash settled fundamental make-whole shares provision. The derivative is adjusted to fair value at each reporting period, with the change in the fair value recorded to other income (expense) in the Company’s consolidated statement of operations and comprehensive On April 24, 2020, $24.0 million aggregate principal of the Company’s outstanding 2025 Notes held by Highbridge Capital Management, LLC (“Highbridge”) were exchanged for (i) $15.7 million of Second Lien Notes (the “Second Lien Notes”), (ii) 11,026,086 shares of common stock, (iii) warrants to purchase up to 4,500,000 shares of common stock at an exercise price of $0.66 per share, and (iv) $0.3 million in accrued and unpaid interest on the 2025 Notes being exchanged. This transaction modified the original 2025 Notes outstanding with Highbridge and resulted in $13.2 million of deferred issuance fees and debt discounts associated with the exchanged 2025 Notes being transferred as a discount to the Second Lien Notes. In January 2021, there were conversions of $6.5 million of outstanding principal amount of the 2025 notes for 4,924,998 shares of common stock. On August 10, 2023, the Company entered into separate, privately negotiated exchange agreements (the “Exchange Agreements”) with a limited number of holders (the “Noteholders”) of the Company’s currently outstanding 2025 Notes. Under the terms of the Exchange Agreements, the Noteholders agreed to exchange with the Company (the “Exchanges”) up to $30.8 million in aggregate principal amount of the 2025 Notes (the “Exchanged Notes”) for a combination of $7.5 million of cash and newly issued shares of common stock (the “Exchange Shares”). The number of Exchange Shares was determined based upon the volume-weighted average price per share of the common stock during a 15-day averaging period commencing on August 11, 2023 and ending August 31, 2023. Based on the volume-weighted average price per share of the common stock during the averaging period, a total of 35.1 million shares of common stock were issued in the Exchanges. The Exchanges were settled on the initial share issuance date of August 14, 2023 and the final settlement date of September 5, 2023. The Company accounted for the Exchanges as an extinguishment of the Exchanged Notes and the associated embedded derivative and recognized a loss of $4.6 million in the caption “Exchange related gain (loss), net” that is a component of other income (expense) in the Company’s consolidated statement of operations and comprehensive loss. The extinguishment loss represents the difference between (i) the carrying value of the Exchanged Notes (inclusive of the fair value of the embedded derivative) and (ii) the sum of $7.5 million cash payment, the fair value of the Exchanged Shares, and transaction costs incurred in the Exchange. Following the Exchanges, approximately $20.4 million aggregate principal amount of the 2025 Notes remain outstanding. The remaining unamortized debt discount and debt issuance costs are amortized as interest expense over the term of the loan at an effective interest rate of 15.54%. The fair value of the derivative at September 30, 2023 and December 31, 2022 was $0.2 million and $4.7 million, respectively. 2023 Notes In the first quarter of 2018, the Company issued $53.0 million in aggregate principal amount of senior convertible notes due February 1, 2023 (the “2023 Notes”). In July 2019, the Company used the net proceeds from the issuance of the 2025 Notes to repurchase $37.0 million aggregate principal amount of the outstanding 2023 Notes. Each $1,000 of principal of the 2023 Notes is initially convertible into 294.1176 shares of the Company’s common stock, which is equivalent to an initial conversion price of approximately $3.40 per share, subject to adjustment upon the occurrence of specified events. maturity date, holders of the 2023 Notes may require the Company to repurchase all or a portion of their 2023 Notes for cash at a repurchase price equal to 100% of the principal amount plus any accrued and unpaid interest. The Company bifurcated the embedded conversion option, along with the interest make-whole provision and make-whole fundamental change provision, and in January 2018 recorded the embedded features as a debt discount and derivative liability in the Company’s consolidated balance sheets at its initial fair value of $17.3 million. Additionally, the Company incurred transaction costs of $2.2 million. The debt discount and transaction costs are being amortized to interest expense over the term of the 2023 Notes at an effective interest rate of 9.30%. The derivative is adjusted to fair value at each reporting period, with the change in the fair value recorded to other income (expense) in the Company’s consolidated statement of operations and comprehensive loss. On January 31, 2023, the Company repaid the outstanding principal and accrued interest in full. The derivative was unexercised upon maturity and the fair value in the amount of $0.02 million was recognized as an extinguishment gain in the caption “Other income (expense)” in Company’s consolidated statement of operations and comprehensive loss. The following carrying amounts were outstanding under the Company’s notes payable as of September 30, 2023 and December 31, 2022 (in thousands): September 30, 2023 Principal ($) Debt (Discount) Premium ($)⁽¹⁾ Issuance Costs ($) Carrying Amount ($) 2025 Notes 20,399 (3,732) (62) 16,605 Loan and Security Agreement 25,000 (880) (240) 23,880 December 31, 2022 Principal ($) Debt (Discount) Premium ($)⁽¹⁾ Issuance Costs ($) Carrying Amount ($) 2023 Notes 15,700 (121) - 15,579 2025 Notes 51,199 (15,029) (252) 35,918 PHC Notes 35,000 (13,698) (837) 20,465 (1) Includes accretion of end of term fees payable at maturity Interest expense related to the notes payable for the nine months ended September 30, 2023 and 2022 was as follows (dollars in thousands): Nine Months Ended September 30, 2023 Interest Rate Interest ($) Debt Discount and Fees ($)⁽¹⁾ Issuance Costs ($) Total Interest Expense ($) 2023 Notes 5.25% 69 120 - 189 2025 Notes 5.25% 1,881 4,808 81 6,770 PHC Notes 8.00% 700 1,442 88 2,230 Loan and Security Agreement 9.90% 158 38 3 199 Total 2,808 6,408 172 9,388 Nine Months Ended September 30, 2022 Interest Rate Interest ($) Debt Discount and Fees ($)⁽¹⁾ Issuance Costs ($) Total Interest Expense ($) 2023 Notes 5.25% 618 1,022 - 1,640 2025 Notes 5.25% 2,002 4,035 68 6,104 PHC Notes 8.00% 2,319 3,519 215 6,053 PPP Loan 1.00% 6 - - 6 Total 4,945 8,576 283 13,803 (1) Includes accretion of end of term fees payable at maturity The following are the scheduled maturities of the Company’s notes payable (including end of term fees) as of September 30, 2023 (in thousands): 2023 (remaining three months) $ — 2024 — 2025 20,399 2026 7,397 Thereafter 19,341 Total $ 47,137 |
Stockholders' Equity (Deficit)
Stockholders' Equity (Deficit) | 9 Months Ended |
Sep. 30, 2023 | |
Stockholders' Equity (Deficit) | |
Stockholders' Equity (Deficit) | 13. Stockholders’ Equity (Deficit) In November 2021, the Company entered into the 2021 Sales Agreement with Jefferies, under which the Company could offer and sell, from time to time, at its sole discretion, shares of its common stock having an aggregate offering price of up to $150.0 million through Jefferies as the sales agent in an “at the market” offering. Jefferies received commissions up to 3.0% of the gross proceeds of any common stock sold through Jefferies under the 2021 Sales Agreement. During the nine months ended September 30, 2023, the Company received $7.4 million in net proceeds from the sale of 9,944,663 shares of its common stock under the 2021 Sales Agreement. In 2022, the Company received $34.4 million in net proceeds from the sale of 15,160,899 shares of its common stock under the 2021 Sales Agreement. On August 7, 2023, the Company and Jefferies mutually agreed to terminate the 2021 Sales Agreement, effective as of August 7, 2023. At the time of termination, approximately $106.6 million remained available for issuance pursuant to the 2021 Sales Agreement. In August 2023, the Company entered into an Equity Distribution Agreement (the “Equity Distribution Agreement”) with Goldman Sachs & Co. LLC (“GS”), under which the Company could offer and sell, from time to time, at its sole discretion, shares of its common stock having an aggregate offering price of up to $106.6 million through GS as its sales agent in an “at the market” offering. GS will receive a commission up to 3.0% of the gross proceeds of any common stock sold through GS under the Equity Distribution Agreement. The shares will be offered and sold pursuant to an effective shelf registration statement on Form S-3, which was originally filed with the Securities and Exchange Commission on August 10, 2023. As of September 30, 2023, no sales have been made under the Equity Distribution Agreement. |
Stock-Based Compensation
Stock-Based Compensation | 9 Months Ended |
Sep. 30, 2023 | |
Stock-Based Compensation | |
Stock-Based Compensation | 14. Stock-Based Compensation 2015 Plan In December 2015, the Company adopted the 2015 Equity Incentive Plan (the “2015 Plan”), under which incentive stock options, non-qualified stock options and restricted stock units may be granted to the Company’s employees and certain other persons, such as officers and directors, in accordance with the 2015 Plan provisions. In February 2016, the Company’s Board of Directors adopted, and the Company’s stockholders approved, an Amended and Restated 2015 Equity Incentive Plan (the “Amended and Restated 2015 Plan”), which became effective on February 20, 2016. The Company’s Board of Directors may terminate the Amended and Restated 2015 Plan at any time. Options granted under the Amended and Restated 2015 Plan expire ten years after the date of grant. Pursuant to the Amended and Restated 2015 Plan, the number of shares of the Company’s common stock reserved for issuance automatically increases on January 1 of each year, ending on January 1, 2026, by 3.5% of the total number of shares of its common stock outstanding on December 31 of the preceding calendar year, or a lesser number of shares as may be determined by its Board of Directors. As of September 30, 2023, 28,974,957 shares remained available for grant under the Amended and Restated 2015 Plan. Inducement Plan On May 30, 2019, the Company adopted the Senseonics Holdings, Inc. Inducement Plan (the “Inducement Plan”), pursuant to which the Company reserved 1,800,000 shares of the Company’s common stock for issuance. The only persons eligible to receive grants of awards under the Inducement Plan are individuals who satisfy the standards for inducement grants in accordance with NYSE American Company Guide Section 711(a), including individuals who were not previously an employee or director of the Company, or following a bona fide period of non-employment, as an inducement material to such persons entering into employment with the Company. An “Award” is any right to receive the Company’s common stock pursuant to the Inducement Plan, consisting of non-statutory options, restricted stock unit awards and other equity incentive awards. As of September 30, 2023, 172,256 shares remained available for grant under the Inducement Plan. Commercial Equity Plan On January 30, 2023, the Company adopted the Senseonics Holdings, Inc. 2023 Commercial Equity Plan (the “Commercial Equity Plan”), pursuant to which the Company reserved 10,000,000 shares of common stock for issuance. Eligible recipients under the plan are non-employees of Senseonics, including employees of our global commercial partner, Ascensia, who assist with the commercialization of our products. An “Award” is any right to receive the Company’s common stock pursuant to the Commercial Equity Plan, consisting of non-statutory options and restricted stock unit awards. The Company has issued 2,937,500 shares under the Commercial Equity Plan since adoption. As of September 30, 2023, 7,062,500 2016 Employee Stock Purchase Plan In February 2016, the Company adopted the 2016 Employee Stock Purchase Plan, (the “2016 ESPP”). The 2016 ESPP became effective on March 17, 2016. The maximum number of shares of common stock that may be issued under the 2016 ESPP was initially 800,000 shares and automatically increases on January 1 of each year, ending on and including January 1, 2026, by 1.0% of the total number of shares of common stock outstanding on December 31 of the preceding calendar year; provided, however, the Board of Directors may act prior to the first day of any calendar year to provide that there will be no January 1 increase in the share reserve for such calendar year or that the increase in the share reserve for such calendar year will be a lesser number of shares of common stock. As of September 30, 2023, there were 17,624,582 shares of common stock available for issuance under the 2016 ESPP. For the nine months ended September 30, 2023, there were purchases of 222,312 shares of common stock pursuant to the 2016 ESPP. The 2016 ESPP permits participants to purchase shares of the Company’s common stock through payroll deductions of up to 15% of their earnings. Unless otherwise determined by the administrator, the purchase price of the shares will be 85% of the lower of the fair market value of common stock on the first day of an offering or on the date of purchase. Participants may end their participation at any time and deductions not yet used in a purchase are refundable upon employment termination. The Company initiated its first 2016 ESPP offering period on August 1, 2019 and new offering periods occur every six months thereafter, each consisting of two purchase periods of six months in duration ending on or about January 31 st st The 2016 ESPP is considered compensatory for financial reporting purposes. 1997 Plan On May 8, 1997, the Company adopted the 1997 Stock Option Plan (the “1997 Plan”), under which incentive stock options, non-qualified stock options, and restricted stock awards may be granted to the Company’s employees and certain other persons in accordance with the 1997 Plan provisions. Approximately 1,026,870 shares of the Company’s common stock underlying options have vested under the 1997 Plan. Upon the effectiveness of the 2015 Plan, the Company no longer grants any awards under the 1997 Plan. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2023 | |
Fair Value Measurements | |
Fair Value Measurements | 15. Fair Value Measurements The following table represents the fair value hierarchy of the Company’s financial assets and liabilities measured at fair value on a recurring basis at September 30, 2023 and December 31, 2022 (in thousands): September 30, 2023 Total Level 1 Level 2 Level 3 Assets Money market funds⁽¹⁾ $ 52,696 $ 52,696 — — Commercial paper 26,281 — 26,281 — Corporate debt securities 7,920 — 7,920 — Asset backed securities — — — — Government and agency securities 35,447 35,447 — — Liabilities Embedded features of the 2025 Notes $ 245 $ — — 245 December 31, 2022 Total Level 1 Level 2 Level 3 Assets Money market funds⁽¹⁾ $ 34,658 $ 34,658 — — Commercial paper 41,503 — 41,503 — Corporate debt securities 32,142 — 32,142 — Asset backed securities 8,260 — 8,260 — Government and agency securities 38,570 31,627 6,943 — Liabilities Embedded features of the 2023 Notes $ 20 $ — 20 — Embedded features of the PHC Notes 44,191 — — 44,191 Embedded features of the 2025 Notes 7,859 — — 7,859 (1) Classified as cash and cash equivalents due to their short-term maturity The following table provides a reconciliation of the beginning and ending net balances of items measured at fair value on a recurring basis that used significant unobservable inputs (Level 3) (in thousands): Level 3 Instruments December 31, 2022 $ 52,050 Conversion of financial instruments (1,109) Gain on change in fair value of embedded features of the PHC Notes (44,191) Gain on change in fair value of embedded features of the 2025 Notes (6,505) September 30, 2023 $ 245 The recurring Level 3 fair value measurements of the embedded features of the notes payable and preferred stock, include the following significant unobservable inputs at September 30, 2023: As of September 30, 2023 2025 Notes Unobservable Inputs ` Assumptions Stock price volatility 45.0 % Probabilities of conversion provisions 5.0 - 85.0 % Credit spread 9.5 % As of December 31, 2022 2025 Notes PHC Notes Unobservable Inputs Assumptions Assumptions Stock price volatility 110.0 % 99.0 % Probabilities of conversion provisions 5.0 - 10.0 % 5.0 - 10.0 % Credit spread 13.96 % 13.96 % Recovery rate -1.56 % -5.51 % |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2023 | |
Income Taxes | |
Income Taxes | 16. Income Taxes The Company has no t recorded any tax provision or benefit for the nine months ended September 30, 2023 or September 30, 2022. The Company has provided a valuation allowance for the full amount of its net deferred tax assets since realization of any future benefit from deductible temporary differences, NOL carryforwards and research and development credits is not more-likely-than-not to be realized at September 30, 2023 and December 31, 2022. |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2023 | |
Related Party Transactions | |
Related Party Transactions | 17. Related Party Transactions PHC has a noncontrolling ownership interest in the Company. In addition, PHC has representation on the Company’s board of directors. The Company entered into a financing agreement with PHC on August 9, 2020 and entered into an exchange agreement with PHC during 2023 (see Note 12 for further discussion). Ascensia, through the ownership interests of its parent company, PHC, is a related party. . We also purchase certain medical supplies from Ascensia for our clinical trials. We paid Ascensia $0.6 million and $0.2 million during The amount due from Ascensia as of September 30, 2023 and December 31, 2022 was $2.7 million and $2.3 million, respectively. The amount due to Ascensia as of September 30, 2023 and December 31, 2022 was $0.5 million and $0.9 million, respectively. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2023 | |
Subsequent Events | |
Subsequent Events | 18. Subsequent Events The Company has evaluated all subsequent events through the filing date of this Form 10-Q with the SEC, to ensure that this filing includes appropriate disclosure of events both recognized in the financial statements as of September 30, 2023, and events which occurred subsequently but were not recognized in the financial statements. There were no subsequent events that required recognition or disclosure. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2023 | |
Summary of Significant Accounting Policies | |
Basis of Presentation | Basis of Presentation The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and the instructions to Quarterly Report on Form 10-Q and Article 10 of Regulation S-X. Although the Company considers the disclosures in these unaudited consolidated financial statements to be adequate to make the information presented not misleading, certain information or footnote information normally included in consolidated financial statements prepared in accordance with U.S. GAAP have been condensed or omitted as permitted under the rules and regulations of the SEC. In the opinion of management, all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair statement of financial position at September 30, 2023, and December 31, 2022, results of operations, comprehensive income (loss), and changes in stockholder’s deficit for the three and nine months ended September 30, 2023 and 2022 and cash flows for the nine months ended September 30, 2023 and 2022 have been included. The unaudited condensed consolidated financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, as filed with the SEC on March 16, 2023. The interim results for September 30, 2023 are not necessarily indicative of the results to be expected for the year ending December 31, 2023, or for any future interim periods. The consolidated financial statements reflect the accounts of Senseonics Holdings, Inc. and its wholly owned operating subsidiary Senseonics, Incorporated. The Company views its operations and manages its business in one segment, glucose monitoring products. Operating segments are defined as components of an enterprise about which separate discrete information is available for evaluation by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses: Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”) |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the reported amounts of revenue and expenses during the reporting period. In the accompanying unaudited consolidated financial statements, estimates are used for, but not limited to, stock-based compensation, recoverability of long-lived assets, deferred taxes and valuation allowances, fair value of investments, derivative assets and liabilities, obsolete inventory, warranty obligations, variable consideration related to revenue, allowance for credit losses, depreciable lives of property and equipment, and accruals for clinical study costs, which are accrued based on estimates of work performed under contract. The Company bases these estimates on historical and anticipated results, trends, and various other assumptions that it believes are reasonable, including assumptions as to future events. These estimates form the basis for making judgments about the carrying values of assets and liabilities and recorded revenues and expenses. Actual results could differ from those estimates; however, management does not believe that such differences would be material. |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Revenue Recognition | |
Schedule of revenue by geographic region | Three Months Ended Nine Months Ended September 30, 2023 September 30, 2023 % % (Dollars in thousands) Amount of Total Amount of Total Revenue, net: United States $ 3,930 64.5 % $ 7,885 54.9 % Outside of the United States 2,167 35.5 6,475 45.1 Total $ 6,097 100.0 % $ 14,360 100.0 % Three Months Ended Nine Months Ended September 30, 2022 September 30, 2022 % % (Dollars in thousands) Amount of Total Amount of Total Revenue, net: United States $ 1,934 41.8 % $ 3,908 36.1 % Outside of the United States 2,688 58.2 6,910 63.9 Total $ 4,622 100.0 % $ 10,818 100.0 % |
Net Income (Loss) per Share (Ta
Net Income (Loss) per Share (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Net Income (Loss) per Share | |
Schedule of computation of basic and diluted net income per share | Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Net (loss) income $ (24,103) $ (60,391) $ (43,202) $ 130,558 Impact of conversion of dilutive securities — — — (188,563) Dilutive Net loss $ (24,103) $ (60,391) $ (43,202) $ (58,005) Net (loss) income per share Basic $ (0.04) $ (0.13) $ (0.08) $ 0.28 Diluted $ (0.04) $ (0.13) $ (0.08) $ (0.10) Basic weighted average shares outstanding 592,452,262 472,475,747 552,703,546 464,244,736 Dilutive potential common stock outstanding Stock-based awards — — — 6,499,671 2023 Notes — — — 4,617,646 2025 Notes — — — 39,211,358 PHC Notes — — — 67,625,174 Energy Capital Option — — — 23,335,635 Warrants — — — 2,811,493 Diluted weighted average shares outstanding 592,452,262 472,475,747 552,703,546 608,345,713 |
Schedule of anti-dilutive shares which have been excluded from the computation of diluted net loss per share | Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Stock-based awards 31,953,024 24,940,972 31,953,024 10,426,560 2023 Notes — 4,617,646 — — 2025 Notes 15,622,814 39,211,358 15,622,814 — PHC Notes — 68,322,952 — — PHC Option — 31,512,605 — 22,717,076 Energy Capital Option — 30,372,058 — — Energy Capital Preferred Shares 30,372,058 — 30,372,058 — Warrants 1,260,183 3,177,821 1,260,183 427,821 Total anti-dilutive shares outstanding 79,208,079 202,155,412 79,208,079 33,571,457 |
Marketable Securities (Tables)
Marketable Securities (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Marketable Securities. | |
Schedule of marketable securities available for sale | Marketable securities available for sale, were as follows (in thousands): September 30, 2023 Gross Gross Estimated Amortized Unrealized Unrealized Market Cost Gains Losses Value Commercial Paper $ 26,281 $ — $ — $ 26,281 Corporate debt securities 7,944 — (24) 7,920 Asset backed securities — — — — Government and agency securities 35,482 — (35) 35,447 Total $ 69,707 $ — $ (59) $ 69,648 December 31, 2022 Gross Gross Estimated Amortized Unrealized Unrealized Market Cost Gains Losses Value Commercial Paper $ 41,503 $ — $ — $ 41,503 Corporate debt securities 32,331 — (189) 32,142 Asset backed securities 8,363 — (103) 8,260 Government and agency securities 38,956 — (386) 38,570 Total $ 121,153 $ — $ (678) $ 120,475 |
Schedule of maturities of marketable securities | The following are the scheduled maturities as of September 30, 2023 (in thousands): Net Fair Carrying Amount Value 2023 (remaining three months) $ 36,156 $ 39,231 2024 33,551 30,417 Total $ 69,707 $ 69,648 |
Inventory, net (Tables)
Inventory, net (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Inventory, net | |
Schedule of Inventory, net | Inventory, net of reserves, consisted of the following (in thousands): September 30, December 31, 2023 2022 Finished goods $ 2,440 $ 1,697 Work-in-process 5,981 4,057 Raw materials 1,305 1,552 Total $ 9,726 $ 7,306 |
Prepaid Expenses and Other Cu_2
Prepaid Expenses and Other Current Assets (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Prepaid Expenses and Other Current Assets | |
Schedule of prepaid expenses and other current assets | Prepaid expenses and other current assets consisted of the following (in thousands): September 30, December 31, 2023 2022 Contract manufacturing⁽¹⁾ $ 4,577 $ 4,097 Tax credits receivable (2) 1,793 — Insurance 340 1,243 Clinical and Preclinical 180 924 Interest receivable 218 336 Rent and utilities 151 132 Research and development 135 67 Accounting and Audit 117 270 Other 46 359 Total prepaid expenses and other current assets $ 7,557 $ 7,428 (1) Includes deposits to contract manufacturers for manufacturing process. (2) Refundable employee retention credits, enacted under the CARES Act. |
Accrued Expenses and Other Cu_2
Accrued Expenses and Other Current Liabilities (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Accrued Expenses and Other Current Liabilities | |
Schedule of accrued expenses and other current liabilities | Accrued expenses and other current liabilities consisted of the following (in thousands): September 30, December 31, 2023 2022 Research and development $ 4,168 $ 3,502 Professional and administrative services 3,947 1,053 Compensation and benefits 3,569 4,699 Contract manufacturing 1,396 2,480 Product warranty and replacement obligations 517 781 Operating lease 413 725 Interest on notes payable 381 149 Sales and marketing services 242 2,050 Other — 14 Total accrued expenses and other current liabilities $ 14,633 $ 15,453 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Leases | |
Summary of lease assets and liabilities | September 30, December 31, Operating Lease Assets and Liabilities Balance Sheet Classification 2023 2022 Assets Operating lease ROU assets Deposits and other assets $ 5,261 $ 3,032 Tenant improvement allowance receivable Deposits and other assets 1,312 — Liabilities Current operating lease liabilities Accrued expenses and other current liabilities $ 413 $ 725 Non-current operating lease liabilities Other non-current liabilities 6,312 2,689 Total operating lease liabilities $ 6,725 $ 3,414 |
Schedule of operating lease liabilities maturities | 2023 (remaining 3 months) $ 283 2024 912 2025 939 2026 967 2027 996 Thereafter 5,934 Total 10,031 Less: Present value adjustment (3,306) Present value of lease liabilities $ 6,725 |
Schedule of lease term and discount rate | Remaining lease term (years) 2023 Operating leases 9.6 Discount rate Operating leases 8.5 % |
Product Warranty Obligations (T
Product Warranty Obligations (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Product Warranty Obligations | |
Schedule of change in estimated warranty liabilities | September 30, December 31, 2023 2022 Balance at beginning of the period $ 781 $ 723 Provision for warranties during the period 136 166 Settlements made during the period (400) (108) Balance at end of the period $ 517 $ 781 |
Notes Payable, Preferred Stoc_2
Notes Payable, Preferred Stock and Stock Purchase Warrants (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Notes Payable, Preferred Stock and Stock Purchase Warrants | |
Schedule of carrying amounts outstanding under the Company's notes payable | The following carrying amounts were outstanding under the Company’s notes payable as of September 30, 2023 and December 31, 2022 (in thousands): September 30, 2023 Principal ($) Debt (Discount) Premium ($)⁽¹⁾ Issuance Costs ($) Carrying Amount ($) 2025 Notes 20,399 (3,732) (62) 16,605 Loan and Security Agreement 25,000 (880) (240) 23,880 December 31, 2022 Principal ($) Debt (Discount) Premium ($)⁽¹⁾ Issuance Costs ($) Carrying Amount ($) 2023 Notes 15,700 (121) - 15,579 2025 Notes 51,199 (15,029) (252) 35,918 PHC Notes 35,000 (13,698) (837) 20,465 |
Schedule of interest expense related to the notes payable | Nine Months Ended September 30, 2023 Interest Rate Interest ($) Debt Discount and Fees ($)⁽¹⁾ Issuance Costs ($) Total Interest Expense ($) 2023 Notes 5.25% 69 120 - 189 2025 Notes 5.25% 1,881 4,808 81 6,770 PHC Notes 8.00% 700 1,442 88 2,230 Loan and Security Agreement 9.90% 158 38 3 199 Total 2,808 6,408 172 9,388 Nine Months Ended September 30, 2022 Interest Rate Interest ($) Debt Discount and Fees ($)⁽¹⁾ Issuance Costs ($) Total Interest Expense ($) 2023 Notes 5.25% 618 1,022 - 1,640 2025 Notes 5.25% 2,002 4,035 68 6,104 PHC Notes 8.00% 2,319 3,519 215 6,053 PPP Loan 1.00% 6 - - 6 Total 4,945 8,576 283 13,803 |
Schedule of future maturities | 2023 (remaining three months) $ — 2024 — 2025 20,399 2026 7,397 Thereafter 19,341 Total $ 47,137 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Fair Value Measurements | |
Schedule of fair value hierarchy of the Company's financial assets and liabilities measured at fair value on a recurring basis | The following table represents the fair value hierarchy of the Company’s financial assets and liabilities measured at fair value on a recurring basis at September 30, 2023 and December 31, 2022 (in thousands): September 30, 2023 Total Level 1 Level 2 Level 3 Assets Money market funds⁽¹⁾ $ 52,696 $ 52,696 — — Commercial paper 26,281 — 26,281 — Corporate debt securities 7,920 — 7,920 — Asset backed securities — — — — Government and agency securities 35,447 35,447 — — Liabilities Embedded features of the 2025 Notes $ 245 $ — — 245 December 31, 2022 Total Level 1 Level 2 Level 3 Assets Money market funds⁽¹⁾ $ 34,658 $ 34,658 — — Commercial paper 41,503 — 41,503 — Corporate debt securities 32,142 — 32,142 — Asset backed securities 8,260 — 8,260 — Government and agency securities 38,570 31,627 6,943 — Liabilities Embedded features of the 2023 Notes $ 20 $ — 20 — Embedded features of the PHC Notes 44,191 — — 44,191 Embedded features of the 2025 Notes 7,859 — — 7,859 (1) Classified as cash and cash equivalents due to their short-term maturity |
Schedule of changes in the fair value of Level 3 derivative liability measured at fair value | The following table provides a reconciliation of the beginning and ending net balances of items measured at fair value on a recurring basis that used significant unobservable inputs (Level 3) (in thousands): Level 3 Instruments December 31, 2022 $ 52,050 Conversion of financial instruments (1,109) Gain on change in fair value of embedded features of the PHC Notes (44,191) Gain on change in fair value of embedded features of the 2025 Notes (6,505) September 30, 2023 $ 245 |
Schedule of assumptions used to determine fair value | As of September 30, 2023 2025 Notes Unobservable Inputs ` Assumptions Stock price volatility 45.0 % Probabilities of conversion provisions 5.0 - 85.0 % Credit spread 9.5 % As of December 31, 2022 2025 Notes PHC Notes Unobservable Inputs Assumptions Assumptions Stock price volatility 110.0 % 99.0 % Probabilities of conversion provisions 5.0 - 10.0 % 5.0 - 10.0 % Credit spread 13.96 % 13.96 % Recovery rate -1.56 % -5.51 % |
Liquidity and Capital Resourc_2
Liquidity and Capital Resources (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||||||||||
Sep. 05, 2023 | Aug. 10, 2023 | Aug. 07, 2023 | Mar. 13, 2023 | Nov. 07, 2022 | Jan. 01, 2022 | Jan. 21, 2021 | Nov. 09, 2020 | Aug. 31, 2023 | Nov. 30, 2021 | Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Sep. 08, 2023 | Mar. 31, 2023 | Apr. 30, 2022 | Aug. 09, 2020 | |
Net (loss) income | $ (24,103) | $ (60,391) | $ (43,202) | $ 130,558 | |||||||||||||||||
Gross profit (loss) | 1,172 | 756 | 2,002 | 2,107 | $ 2,700 | $ (800) | $ (17,400) | ||||||||||||||
Accumulated deficit | (852,069) | (852,069) | $ (808,866) | ||||||||||||||||||
Cash, cash equivalents and marketable securities | $ 125,400 | $ 125,400 | |||||||||||||||||||
Common stock, par value per share (in dollars per share) | $ 0.001 | $ 0.001 | $ 0.001 | ||||||||||||||||||
Issuance of common stock, net of issuance costs | $ 26,439 | $ 7,376 | $ 34,443 | ||||||||||||||||||
Proceeds from issuance of warrants | $ 15,000 | ||||||||||||||||||||
Purchase Warrant | |||||||||||||||||||||
Beneficial ownership by PHC (%) | 15% | ||||||||||||||||||||
PHC Notes | |||||||||||||||||||||
Interest rate (as a percent) | 8% | 9.50% | |||||||||||||||||||
Aggregate principal amount | $ 35,000 | $ 35,000 | $ 35,000 | ||||||||||||||||||
Common stock, par value per share (in dollars per share) | $ 0.001 | ||||||||||||||||||||
Conversion price | $ 0.53 | ||||||||||||||||||||
2025 Notes. | |||||||||||||||||||||
Interest rate (as a percent) | 5.25% | ||||||||||||||||||||
Aggregate principal amount | $ 30,800 | ||||||||||||||||||||
Converted debt amount | $ 7,500 | ||||||||||||||||||||
Debt converted, Shares issued | 35,100,000 | ||||||||||||||||||||
Ascensia | PHC Notes | |||||||||||||||||||||
Aggregate principal amount | $ 35,000 | $ 35,000 | |||||||||||||||||||
Energy Capital, LLC | |||||||||||||||||||||
Excess of the purchase price and fair value of option recorded in additional-paid-in-capital | $ 37,600 | ||||||||||||||||||||
Energy Capital, LLC | Minimum | |||||||||||||||||||||
Issuance of convertible preferred stock, net of issuance costs | $ 4,000 | ||||||||||||||||||||
Energy Capital, LLC | Maximum | |||||||||||||||||||||
Issuance of convertible preferred stock, net of issuance costs | $ 12,000 | ||||||||||||||||||||
Share price | $ 0.25 | ||||||||||||||||||||
Exchange Warrant | |||||||||||||||||||||
Number of shares of common stock called by warrant | 68,525,311 | ||||||||||||||||||||
Exercise price of warrant (in dollars per share) | $ 0.001 | ||||||||||||||||||||
Purchase Warrant | |||||||||||||||||||||
Number of shares of common stock called by warrant | 15,425,750 | ||||||||||||||||||||
Exercise price of warrant (in dollars per share) | $ 0.001 | ||||||||||||||||||||
Purchase price of warrant (in dollars per share) | $ 0.97 | ||||||||||||||||||||
Convertible Preferred Equity | |||||||||||||||||||||
Amount of possible additional debt principal amount | $ 15,000 | ||||||||||||||||||||
Convertible Preferred Equity | Energy Capital, LLC | |||||||||||||||||||||
Issuance of convertible preferred stock, net of issuance costs | $ 12,000 | ||||||||||||||||||||
Price per share (in dollars per share) | 1,000 | ||||||||||||||||||||
Collaboration and commercialization agreement term | 24 months | ||||||||||||||||||||
Share price | $ 1,000 | ||||||||||||||||||||
Threshold redemption period of temporary equity | 6 months | ||||||||||||||||||||
Conversion price | $ 0.3951 | ||||||||||||||||||||
Series B Preferred Stock | |||||||||||||||||||||
Issuance of convertible preferred stock, net of issuance costs | 12,000 | ||||||||||||||||||||
Regular Purchase, Shares Sold | 0 | ||||||||||||||||||||
Series B Preferred Stock | Energy Capital, LLC | |||||||||||||||||||||
Issuance of convertible preferred stock, net of issuance costs | $ 12,000 | ||||||||||||||||||||
Open Market Sale Agreement | |||||||||||||||||||||
Shares issued | 9,944,663 | 15,160,899 | |||||||||||||||||||
Proceeds from issuance of stock | $ 7,400 | $ 34,400 | |||||||||||||||||||
Open Market Sale Agreement | Maximum | |||||||||||||||||||||
Issuance of common stock, net of issuance costs | $ 150,000 | ||||||||||||||||||||
Percentage of commission on proceeds from common stock | 3% | ||||||||||||||||||||
Open Market Sale Agreement | Jefferies LLC | |||||||||||||||||||||
Issuance of common stock, net of issuance costs | $ 106,600 | ||||||||||||||||||||
Shares issued | 9,944,663 | 15,160,899 | |||||||||||||||||||
Proceeds from issuance of stock | $ 7,400 | $ 34,400 | |||||||||||||||||||
Open Market Sale Agreement | Jefferies LLC | Maximum | |||||||||||||||||||||
Issuance of common stock, net of issuance costs | $ 150,000 | ||||||||||||||||||||
Percentage of commission on proceeds from common stock | 3% | ||||||||||||||||||||
Equity Distribution Agreement | |||||||||||||||||||||
Shares issued | 0 | ||||||||||||||||||||
Equity Distribution Agreement | Goldman Sachs & Co. LLC | |||||||||||||||||||||
Issuance of common stock, net of issuance costs | $ 0 | ||||||||||||||||||||
Equity Distribution Agreement | Goldman Sachs & Co. LLC | Maximum | |||||||||||||||||||||
Issuance of common stock, net of issuance costs | $ 106,600 | ||||||||||||||||||||
Percentage of commission on proceeds from common stock | 3% | ||||||||||||||||||||
The Loan Agreement | Hercules | Term Loan Facility | Maximum | |||||||||||||||||||||
Secured debt | $ 50,000 | ||||||||||||||||||||
The Loan Agreement | Hercules | Tranche 1 Loan | |||||||||||||||||||||
Secured debt | 25,000 | ||||||||||||||||||||
The Loan Agreement | Hercules | Tranche 2 Loan | |||||||||||||||||||||
Secured debt | 10,000 | ||||||||||||||||||||
The Loan Agreement | Hercules | Tranche 3 Loan | |||||||||||||||||||||
Secured debt | $ 15,000 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies - Segment Information (Details) | 9 Months Ended |
Sep. 30, 2023 segment | |
Segment Information | |
Number of operating segments | 1 |
Revenue Recognition - Revenue b
Revenue Recognition - Revenue by Geographic Region (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 USD ($) | Sep. 30, 2022 USD ($) | Sep. 30, 2023 USD ($) item | Sep. 30, 2022 USD ($) | |
Revenue, net: | ||||
Revenue, net | $ 6,097 | $ 4,622 | $ 14,360 | $ 10,818 |
Percent of total revenue | 100% | 100% | 100% | 100% |
Number of geographical markets | item | 2 | |||
Outside of the United States | ||||
Revenue, net: | ||||
Revenue, net | $ 2,167 | $ 2,688 | $ 6,475 | $ 6,910 |
Percent of total revenue | 35.50% | 58.20% | 45.10% | 63.90% |
United States | ||||
Revenue, net: | ||||
Revenue, net | $ 3,930 | $ 1,934 | $ 7,885 | $ 3,908 |
Percent of total revenue | 64.50% | 41.80% | 54.90% | 36.10% |
Revenue Recognition - Contract
Revenue Recognition - Contract Assets (Details) - USD ($) $ in Millions | Sep. 30, 2023 | Dec. 31, 2022 |
Revenue Recognition | ||
Unbilled receivables from customers | $ 1.3 | $ 1.7 |
Revenue Recognition - Concentra
Revenue Recognition - Concentration of Revenue and Customers (Details) - Customer concentration risk - Ascensia - customer | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Concentration Risk [Line Items] | ||||
Number of customers | 1 | 1 | 1 | 1 |
Revenue | ||||
Concentration Risk [Line Items] | ||||
Concentration Risk, Percentage | 93% | 97% | 92% | 95% |
Net Income (Loss) per Share - B
Net Income (Loss) per Share - Basic and Diluted Net Income Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Net (loss) income | $ (24,103) | $ (60,391) | $ (43,202) | $ 130,558 |
Impact of conversion of dilutive securities | (188,563) | |||
Dilutive Net Loss | $ (24,103) | $ (60,391) | $ (43,202) | $ (58,005) |
Net (loss) income per share | ||||
Basic | $ (0.04) | $ (0.13) | $ (0.08) | $ 0.28 |
Diluted | $ (0.04) | $ (0.13) | $ (0.08) | $ (0.10) |
Basic weighted average shares outstanding | 592,452,262 | 472,475,747 | 552,703,546 | 464,244,736 |
Dilutive potential common stock outstanding | ||||
Stock-based awards | 6,499,671 | |||
Warrants | 2,811,493 | |||
Diluted weighted average shares outstanding | 592,452,262 | 472,475,747 | 552,703,546 | 608,345,713 |
Anti-dilutive shares outstanding | 79,208,079 | 202,155,412 | 79,208,079 | 33,571,457 |
Stock-based awards | ||||
Dilutive potential common stock outstanding | ||||
Anti-dilutive shares outstanding | 31,953,024 | 24,940,972 | 31,953,024 | 10,426,560 |
2023 Notes | ||||
Dilutive potential common stock outstanding | ||||
Convertible Notes | 4,617,646 | |||
Anti-dilutive shares outstanding | 4,617,646 | |||
2025 Notes | ||||
Dilutive potential common stock outstanding | ||||
Convertible Notes | 39,211,358 | |||
Anti-dilutive shares outstanding | 15,622,814 | 39,211,358 | 15,622,814 | |
PHC Notes | ||||
Dilutive potential common stock outstanding | ||||
Convertible Notes | 67,625,174 | |||
Anti-dilutive shares outstanding | 68,322,952 | |||
PHC Option | ||||
Dilutive potential common stock outstanding | ||||
Anti-dilutive shares outstanding | 31,512,605 | 22,717,076 | ||
Energy Capital Option | ||||
Dilutive potential common stock outstanding | ||||
Convertible Notes | 23,335,635 | |||
Anti-dilutive shares outstanding | 30,372,058 | |||
Energy Capital Preferred Shares | ||||
Dilutive potential common stock outstanding | ||||
Anti-dilutive shares outstanding | 30,372,058 | 30,372,058 | ||
Warrants | ||||
Dilutive potential common stock outstanding | ||||
Anti-dilutive shares outstanding | 1,260,183 | 3,177,821 | 1,260,183 | 427,821 |
Number of shares called by warrants | 83,951,061 | 83,951,061 |
Marketable Securities - AFS Deb
Marketable Securities - AFS Debt Securities (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Marketable securities available for sale, consisting of debt securities: | ||
Amortized Cost | $ 69,707 | $ 121,153 |
Gross Unrealized Losses | (59) | (678) |
Estimated Market Value | 69,648 | 120,475 |
Commercial paper | ||
Marketable securities available for sale, consisting of debt securities: | ||
Amortized Cost | 26,281 | 41,503 |
Estimated Market Value | 26,281 | 41,503 |
Corporate debt securities | ||
Marketable securities available for sale, consisting of debt securities: | ||
Amortized Cost | 7,944 | 32,331 |
Gross Unrealized Losses | (24) | (189) |
Estimated Market Value | 7,920 | 32,142 |
Asset backed Securities | ||
Marketable securities available for sale, consisting of debt securities: | ||
Amortized Cost | 8,363 | |
Gross Unrealized Losses | (103) | |
Estimated Market Value | 8,260 | |
Government and agency securities | ||
Marketable securities available for sale, consisting of debt securities: | ||
Amortized Cost | 35,482 | 38,956 |
Gross Unrealized Losses | (35) | (386) |
Estimated Market Value | $ 35,447 | $ 38,570 |
Marketable Securities - AFS D_2
Marketable Securities - AFS Debt Securities - Maturities (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Net Carrying Amount | ||
2023 (remaining three months) | $ 36,156 | |
2024 | 33,551 | |
Total | 69,707 | $ 121,153 |
Fair Value | ||
2023 (remaining three months) | 39,231 | |
2024 | 30,417 | |
Total | $ 69,648 |
Inventory, net (Details)
Inventory, net (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 | Sep. 30, 2022 |
Finished goods | $ 2,440 | $ 1,697 | |
Work-in-process | 5,981 | 4,057 | |
Raw materials | 1,305 | 1,552 | |
Total | 9,726 | $ 7,306 | |
Cost of sales | |||
Inventory adjustments included in cost of sales | |||
Inventory adjustments | $ 100 | $ 500 |
Prepaid Expenses and Other Cu_3
Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Prepaid Expenses and Other Current Assets | ||
Contract manufacturing | $ 4,577 | $ 4,097 |
Tax credits receivable | 1,793 | |
Insurance | 340 | 1,243 |
Clinical and Preclinical | 180 | 924 |
Interest receivable | 218 | 336 |
Rent and utilities | 151 | 132 |
Research and development | 135 | 67 |
Accounting and Audit | 117 | 270 |
Other | 46 | 359 |
Total prepaid expenses and other current assets | $ 7,557 | $ 7,428 |
Accrued Expenses and Other Cu_3
Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Accrued Expenses and Other Current Liabilities | ||
Research and development | $ 4,168 | $ 3,502 |
Professional and administrative services | 3,947 | 1,053 |
Compensation and benefits | 3,569 | 4,699 |
Contract manufacturing | 1,396 | 2,480 |
Product warranty and replacement obligations | 517 | 781 |
Operating lease | $ 413 | $ 725 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List] | Accrued Liabilities and Other Liabilities, Current | Accrued Liabilities and Other Liabilities, Current |
Interest on notes payable | $ 381 | $ 149 |
Sales and marketing services | 242 | 2,050 |
Other | 14 | |
Total accrued expenses and other current liabilities | $ 14,633 | $ 15,453 |
Leases - (Details)
Leases - (Details) $ in Thousands | 1 Months Ended | 9 Months Ended | ||
May 31, 2023 USD ($) | Sep. 30, 2023 USD ($) ft² item | Sep. 30, 2022 USD ($) | Dec. 31, 2022 USD ($) | |
Lessee, Lease, Description [Line Items] | ||||
Operating lease ROU assets | $ 5,261 | $ 3,032 | ||
Operating Lease, Liability | 6,725 | $ 3,414 | ||
Operating lease expense | $ 600 | $ 500 | ||
Research and Office Space | ||||
Lessee, Lease, Description [Line Items] | ||||
Leased space, in square feet | ft² | 33,000 | |||
Tenant improvement allowance | $ 1,300 | |||
Number of renewal terms | item | 1 | |||
Renewal term of lease | 5 years | |||
Option to renew lease | true | |||
Operating lease ROU assets | 2,500 | |||
Operating Lease, Liability | $ 3,800 |
Leases - Assets and liabilities
Leases - Assets and liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Operating Lease Assets and Liabilities | ||
Operating lease ROU assets | $ 5,261 | $ 3,032 |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Deposits and Other Assets, Noncurrent | Deposits and Other Assets, Noncurrent |
Tenant improvement allowance receivable | $ 1,312 | |
Current operating lease liabilities | $ 413 | $ 725 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List] | Accrued Liabilities and Other Liabilities, Current | Accrued Liabilities and Other Liabilities, Current |
Non-current operating lease liabilities | $ 6,312 | $ 2,689 |
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | Other Liabilities, Noncurrent | Other Liabilities, Noncurrent |
Present value of lease liabilities | $ 6,725 | $ 3,414 |
Maturity of undiscounted payments | ||
2023 (remaining 3 months) | 283 | |
2024 | 912 | |
2025 | 939 | |
2026 | 967 | |
2027 | 996 | |
Thereafter | 5,934 | |
Total | 10,031 | |
Present value adjustment | (3,306) | |
Present value of lease liabilities | $ 6,725 | $ 3,414 |
Remaining lease term (years) | 9 years 7 months 6 days | |
Discount rate | 8.50% |
Product Warranty Obligations (D
Product Warranty Obligations (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Product Warranty Obligations | ||
Warranty term | 1 year | |
Warranty reserve | $ 517 | $ 781 |
Reconciliation of the change in estimated warranty liabilities | ||
Balance at beginning of the period | 781 | 723 |
Provision for warranties during the period | 136 | 166 |
Settlements made during the period | (400) | (108) |
Balance at end of the period | $ 517 | $ 781 |
Notes Payable, Preferred Stoc_3
Notes Payable, Preferred Stock and Stock Purchase Warrants - Term Loans (Details) - USD ($) $ / shares in Units, $ in Thousands | Sep. 08, 2023 | Apr. 22, 2020 | Sep. 30, 2023 | Sep. 30, 2022 |
Term Loans | ||||
Debt Instrument [Line Items] | ||||
Principal amount | $ 25,000 | |||
Effective interest rate (as percentage) | 9.90% | |||
Term Loans | Hercules Capital, Inc. and its managed fund | ||||
Debt Instrument [Line Items] | ||||
Maximum amount available under facility | $ 50,000 | |||
Interest rate (as a percent) | 9.90% | |||
Prepayment fee on principal amount if paid within one year (as percentage) | 3% | |||
Prepayment fee on principal amount if prepayment occurs during the second year (as percentage) | 2% | |||
Prepayment fee on principal amount if prepayment occurs in more than two years (as percentage) | 1% | |||
Payment of facility fee on prepayment of borrowings | $ 375 | |||
Additional facility charges (as percentage) | 0.50% | |||
Final prepayment fee (as a percent) | 6.95% | |||
Minimum cash covenant percentage | 30% | |||
Added default interest rate (as percentage) | 4% | |||
Number of shares called by warrants | 832,362 | |||
Exercise price of warrant (in dollars per share) | $ 0.6007 | |||
Debt fair value | $ 25,000 | |||
Warrants fair value | 400 | |||
Debt issuance costs and discounts | $ 1,100 | |||
Effective interest rate (as percentage) | 13.01% | |||
Warrants term (in years) | 7 years | |||
Funded loan amount on exercise of warrants for shares (as percentage) | 2% | |||
Volume-weighted average price considered for exercise of warrants (in days) | 3 days | |||
Term Loans | Hercules Capital, Inc. and its managed fund | Prime rate | ||||
Debt Instrument [Line Items] | ||||
Spread for interest rate (as percentage) | 1.40% | |||
Tranche 1 Term Loan | Hercules Capital, Inc. and its managed fund | ||||
Debt Instrument [Line Items] | ||||
Maximum amount available under facility | $ 25,000 | |||
Tranche 2 Term Loan | Hercules Capital, Inc. and its managed fund | ||||
Debt Instrument [Line Items] | ||||
Maximum amount available under facility | 10,000 | |||
Tranche 3 Term Loan | Hercules Capital, Inc. and its managed fund | ||||
Debt Instrument [Line Items] | ||||
Maximum amount available under facility | $ 15,000 | |||
PPP Loan | ||||
Debt Instrument [Line Items] | ||||
Amount received from loan funding | $ 5,800 | |||
Interest rate (as a percent) | 1% | |||
Debt instrument term (in years) | 2 years | |||
Effective interest rate (as percentage) | 1% | |||
PPP Loan | Silicon Valley Bank | ||||
Debt Instrument [Line Items] | ||||
Principal amount | $ 5,800 |
Notes Payable, Preferred Stoc_4
Notes Payable, Preferred Stock and Stock Purchase Warrants - Convertible Preferred Stock and Warrants (Details) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||||||||||||||||
Sep. 05, 2023 shares | Mar. 13, 2023 USD ($) $ / shares shares | Jan. 31, 2023 USD ($) | Nov. 07, 2022 USD ($) | Jan. 01, 2022 USD ($) shares | Jan. 21, 2021 USD ($) $ / shares shares | Nov. 09, 2020 USD ($) $ / shares | Aug. 09, 2020 USD ($) $ / shares | Apr. 24, 2020 USD ($) $ / shares shares | Mar. 31, 2023 USD ($) | Sep. 30, 2022 USD ($) | Sep. 30, 2022 USD ($) | Dec. 31, 2022 USD ($) | Sep. 30, 2023 USD ($) | Aug. 10, 2023 USD ($) | Apr. 30, 2022 | Feb. 28, 2022 shares | Dec. 31, 2021 USD ($) | May 09, 2021 $ / shares shares | Dec. 31, 2020 USD ($) | Mar. 31, 2018 USD ($) | |
Notes payable | |||||||||||||||||||||
Derivative liabilities | $ 52,050,000 | $ 245,000 | |||||||||||||||||||
Gain (Loss) on fair value adjustment of option | $ (8,592,000) | $ 41,333,000 | |||||||||||||||||||
Exchange Agreement with Highbridge | |||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||
Warrants to purchase shares | shares | 4,500,000 | ||||||||||||||||||||
Exercise price of warrant (in dollars per share) | $ / shares | $ 0.66 | ||||||||||||||||||||
Notes payable | |||||||||||||||||||||
Shares issued | shares | 11,026,086 | ||||||||||||||||||||
Accrued and unpaid interest | $ 300,000 | ||||||||||||||||||||
Term Notes Payable | |||||||||||||||||||||
Notes payable | |||||||||||||||||||||
Principal amount | 25,000,000 | ||||||||||||||||||||
Issuance costs incurred | $ 240,000 | ||||||||||||||||||||
2023 Notes. | |||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||
Gain (Loss) on extinguishment of debt | $ 20,000 | ||||||||||||||||||||
Notes payable | |||||||||||||||||||||
Derivative liabilities | $ 17,300,000 | ||||||||||||||||||||
2025 Notes. | |||||||||||||||||||||
Notes payable | |||||||||||||||||||||
Principal amount | $ 30,800,000 | ||||||||||||||||||||
Interest rate (as a percent) | 5.25% | ||||||||||||||||||||
Debt converted, Shares issued | shares | 35,100,000 | ||||||||||||||||||||
2025 Notes. | Exchange Agreement with Highbridge | |||||||||||||||||||||
Notes payable | |||||||||||||||||||||
Principal amount | 24,000,000 | ||||||||||||||||||||
Deferred issuance costs and debt discounts | $ 13,200,000 | ||||||||||||||||||||
Energy Capital Facility | |||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||
Net exercise of warrants | shares | 8,917,535 | ||||||||||||||||||||
Exercise price of warrant (in dollars per share) | $ / shares | $ 0.3951 | ||||||||||||||||||||
Notes payable | |||||||||||||||||||||
Deferred issuance costs and debt discounts | $ 7,600,000 | ||||||||||||||||||||
Period to purchase stock | 24 months | ||||||||||||||||||||
Derivative liabilities | $ 4,200,000 | $ 69,400,000 | |||||||||||||||||||
Adjusted of option to fair value | 25,700,000 | ||||||||||||||||||||
Gain (Loss) on fair value adjustment of option | 43,700,000 | ||||||||||||||||||||
Energy Capital Facility | Maximum | |||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||
Warrants to purchase shares | shares | 10,000,000 | ||||||||||||||||||||
Notes payable | |||||||||||||||||||||
Share price for debt conversion | $ / shares | $ 0.25 | ||||||||||||||||||||
PHC Notes | |||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||
Gain (Loss) on extinguishment of debt | $ 48,600,000 | 100,000 | |||||||||||||||||||
Notes payable | |||||||||||||||||||||
Principal amount | $ 35,000,000 | 35,000,000 | 35,000,000 | ||||||||||||||||||
Interest rate (as a percent) | 9.50% | 8% | |||||||||||||||||||
Debt issuance costs and discounts | $ 1,400,000 | ||||||||||||||||||||
Fair value of the embedded conversion option | 25,800,000 | 0 | |||||||||||||||||||
Original debt conversion amount | $ 0 | ||||||||||||||||||||
Conversion rate | 1,867.4136 | ||||||||||||||||||||
Conversion price | $ / shares | $ 0.53 | ||||||||||||||||||||
Issuance costs incurred | $ 2,900,000 | $ 837,000 | |||||||||||||||||||
Amount of principal which is converted to shares | $ 1,000 | ||||||||||||||||||||
PHC Notes | Other income | |||||||||||||||||||||
Notes payable | |||||||||||||||||||||
Change in fair value of embedded derivative | 44,200,000 | ||||||||||||||||||||
Purchase Warrant | |||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||
Exercise price of warrant (in dollars per share) | $ / shares | $ 0.001 | ||||||||||||||||||||
Purchase Warrant | PHC | |||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||
Warrants to purchase shares | shares | 15,425,750 | ||||||||||||||||||||
Exercise price of warrant (in dollars per share) | $ / shares | $ 0.001 | ||||||||||||||||||||
Notes payable | |||||||||||||||||||||
Aggregate gross proceeds | $ 15,000,000 | ||||||||||||||||||||
Warrants fair value | 14,300,000 | ||||||||||||||||||||
Additional paid-in-capital | $ 700,000 | ||||||||||||||||||||
Exchange Warrant | |||||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||||
Warrants to purchase shares | shares | 68,525,311 | ||||||||||||||||||||
Exercise price of warrant (in dollars per share) | $ / shares | $ 0.001 | ||||||||||||||||||||
Notes payable | |||||||||||||||||||||
Warrants fair value | $ 48,600,000 | ||||||||||||||||||||
Interest payments | $ 675,000 | ||||||||||||||||||||
Exchange Warrant | PHC Notes | |||||||||||||||||||||
Notes payable | |||||||||||||||||||||
Original debt conversion amount | $ 35,000,000 | ||||||||||||||||||||
Series B Preferred Stock | |||||||||||||||||||||
Notes payable | |||||||||||||||||||||
Number of shares sold pursuant to regular purchases | shares | 0 | ||||||||||||||||||||
Maximum amount of shares that can be purchased under the equity line agreement at purchase price | $ 12,000,000 | ||||||||||||||||||||
Aggregate principal amount of convertible preferred equity | $ 12,000,000 | ||||||||||||||||||||
Series B Preferred Stock | Energy Capital Facility | |||||||||||||||||||||
Notes payable | |||||||||||||||||||||
Preferred stock value | $ 12,000,000 | ||||||||||||||||||||
Share price for debt conversion | $ / shares | $ 1,000 | ||||||||||||||||||||
Number of shares sold pursuant to regular purchases | shares | 0 | ||||||||||||||||||||
Maximum amount of shares that can be purchased under the equity line agreement at purchase price | $ 12,000,000 | ||||||||||||||||||||
Period to purchase stock | 6 months | ||||||||||||||||||||
Daily limit | $ 4,000,000 | ||||||||||||||||||||
Conversion price | $ / shares | $ 0.3951 |
Notes Payable, Preferred Stoc_5
Notes Payable, Preferred Stock and Stock Purchase Warrants - Convertible Notes (Details) | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||||||||
Aug. 10, 2023 USD ($) shares | Jan. 31, 2023 USD ($) | Aug. 09, 2020 USD ($) $ / shares shares | Jan. 31, 2021 USD ($) shares | Jul. 31, 2019 USD ($) $ / shares | Mar. 31, 2023 USD ($) | Mar. 31, 2018 USD ($) $ / shares | Dec. 31, 2022 USD ($) $ / shares | Sep. 30, 2023 USD ($) $ / shares | Sep. 30, 2022 | Apr. 30, 2022 | Apr. 24, 2020 USD ($) | |
Long term debt | ||||||||||||
Common stock, par value per share (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | ||||||||||
Carrying Amount | $ 56,383,000 | $ 40,485,000 | ||||||||||
Derivative liabilities | 52,050,000 | $ 245,000 | ||||||||||
PHC Notes | ||||||||||||
Long term debt | ||||||||||||
Principal amount | $ 35,000,000 | $ 35,000,000 | 35,000,000 | |||||||||
Financing fee shares issued | shares | 2,941,176 | |||||||||||
Common stock, par value per share (in dollars per share) | $ / shares | $ 0.001 | |||||||||||
Debt Discount Of Financing Fee Shares | $ 1,500,000 | |||||||||||
Interest rate (as a percent) | 9.50% | 8% | ||||||||||
Conversion rate (per $1,000 of principal) | 1,867.4136 | |||||||||||
Amount of principal which is converted to shares | $ 1,000 | |||||||||||
Conversion price (in dollars per share) | $ / shares | $ 0.53 | |||||||||||
Conversion of Stock, Amount Issued | $ 15,000,000 | |||||||||||
Gain (Loss) on extinguishment of debt | 48,600,000 | 100,000 | ||||||||||
Fair value of the embedded conversion option | 25,800,000 | 0 | ||||||||||
Issuance costs incurred | 2,900,000 | 837,000 | ||||||||||
Debt issuance costs and discounts | 1,400,000 | |||||||||||
Original debt conversion amount | $ 0 | |||||||||||
Effective interest rate (as percentage) | 29.19% | 8% | 8% | |||||||||
Carrying Amount | 25,400,000 | 20,465,000 | ||||||||||
Interest Payable | 23,200,000 | |||||||||||
Net gain on exchange of debt instrument | $ 18,800,000 | |||||||||||
PHC Notes | Debt Redemption on or After October 31, 2022 | ||||||||||||
Long term debt | ||||||||||||
Threshold percentage of stock trigger | 275% | |||||||||||
Notice period | 10 days | |||||||||||
PHC Notes | Debt Redemption on or After October 31, 2023 | ||||||||||||
Long term debt | ||||||||||||
Notice period | 10 days | |||||||||||
PHC Notes | Debt Redemption Six Months Prior to Maturity Date | ||||||||||||
Long term debt | ||||||||||||
Call premium percentage | 130% | |||||||||||
PHC Notes | Debt Redemption Within Six Months of Maturity Date | ||||||||||||
Long term debt | ||||||||||||
Call premium percentage | 125% | |||||||||||
2023 Notes. | ||||||||||||
Long term debt | ||||||||||||
Gain (Loss) on extinguishment of debt | $ 20,000 | |||||||||||
Derivative liabilities | $ 17,300,000 | |||||||||||
2023 Notes | ||||||||||||
Long term debt | ||||||||||||
Principal amount | $ 53,000,000 | 15,700,000 | ||||||||||
Conversion rate (per $1,000 of principal) | 294.1176 | |||||||||||
Amount of principal which is converted to shares | $ 1,000 | |||||||||||
Conversion price (in dollars per share) | $ / shares | $ 3.40 | |||||||||||
Effective interest rate (as percentage) | 5.25% | 5.25% | ||||||||||
Carrying Amount | 15,579,000 | |||||||||||
Repurchase price as a percent of principal amount | 100% | |||||||||||
Transaction costs | $ 2,200,000 | |||||||||||
Amortization percent | 9.30% | |||||||||||
Repurchase amount | $ 37,000,000 | |||||||||||
2025 Notes | ||||||||||||
Long term debt | ||||||||||||
Principal amount | $ 30,800,000 | $ 82,000,000 | 51,199,000 | $ 20,399,000 | ||||||||
Conversion rate (per $1,000 of principal) | 757.5758 | |||||||||||
Amount of principal which is converted to shares | $ 1,000 | |||||||||||
Conversion price (in dollars per share) | $ / shares | $ 1.32 | |||||||||||
Gain (Loss) on extinguishment of debt | $ (4,600,000) | $ (3,200,000) | ||||||||||
Fair value of the embedded conversion option | 4,700,000 | 200,000 | ||||||||||
Issuance costs incurred | 252,000 | $ 62,000 | ||||||||||
Original debt conversion amount | $ 6,500,000 | |||||||||||
Effective interest rate (as percentage) | 15.54% | 5.25% | 5.25% | |||||||||
Carrying Amount | $ 20,400,000 | $ 35,918,000 | $ 16,605,000 | |||||||||
Converted debt amount | $ 7,500,000 | |||||||||||
Debt converted, Shares issued | shares | 35,100,000 | 4,924,998 | ||||||||||
Second Lien Notes | Exchange Agreement with Highbridge | ||||||||||||
Long term debt | ||||||||||||
Principal amount | $ 15,700,000 |
Notes Payable, Preferred Stoc_6
Notes Payable, Preferred Stock and Stock Purchase Warrants - Carrying amount of notes payable (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Aug. 10, 2023 | Mar. 31, 2023 | Dec. 31, 2022 | Aug. 09, 2020 | Jul. 31, 2019 | Mar. 31, 2018 |
Debt Instrument [Line Items] | |||||||
Carrying Amount | $ 40,485 | $ 56,383 | |||||
2023 Notes | |||||||
Debt Instrument [Line Items] | |||||||
Principal | 15,700 | $ 53,000 | |||||
Debt (Discount) Premium | (121) | ||||||
Carrying Amount | 15,579 | ||||||
2025 Notes | |||||||
Debt Instrument [Line Items] | |||||||
Principal | 20,399 | $ 30,800 | 51,199 | $ 82,000 | |||
Debt (Discount) Premium | (3,732) | (15,029) | |||||
Issuance Costs | (62) | (252) | |||||
Carrying Amount | 16,605 | $ 20,400 | 35,918 | ||||
Term Loans | |||||||
Debt Instrument [Line Items] | |||||||
Principal | 25,000 | ||||||
Debt (Discount) Premium | (880) | ||||||
Issuance Costs | (240) | ||||||
Carrying Amount | $ 23,880 | ||||||
PHC Notes | |||||||
Debt Instrument [Line Items] | |||||||
Principal | $ 35,000 | 35,000 | $ 35,000 | ||||
Debt (Discount) Premium | (13,698) | ||||||
Issuance Costs | (837) | $ (2,900) | |||||
Carrying Amount | $ 25,400 | $ 20,465 |
Notes Payable, Preferred Stoc_7
Notes Payable, Preferred Stock and Stock Purchase Warrants - Interest expense (Details) - USD ($) $ in Thousands | 9 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Aug. 10, 2023 | Aug. 09, 2020 | |
Long term debt | ||||
Interest | $ 2,808 | $ 4,945 | ||
Debt Discount and Fees | 6,408 | 8,576 | ||
Issuance Costs | 172 | 283 | ||
Total Interest Expense | $ 9,388 | $ 13,803 | ||
2023 Notes | ||||
Long term debt | ||||
Effective interest rate (as percentage) | 5.25% | 5.25% | ||
Interest | $ 69 | $ 618 | ||
Debt Discount and Fees | 120 | 1,022 | ||
Total Interest Expense | $ 189 | $ 1,640 | ||
2025 Notes | ||||
Long term debt | ||||
Effective interest rate (as percentage) | 5.25% | 5.25% | 15.54% | |
Interest | $ 1,881 | $ 2,002 | ||
Debt Discount and Fees | 4,808 | 4,035 | ||
Issuance Costs | 81 | 68 | ||
Total Interest Expense | $ 6,770 | $ 6,104 | ||
PHC Notes | ||||
Long term debt | ||||
Effective interest rate (as percentage) | 8% | 8% | 29.19% | |
Interest | $ 700 | $ 2,319 | ||
Debt Discount and Fees | 1,442 | 3,519 | ||
Issuance Costs | 88 | 215 | ||
Total Interest Expense | $ 2,230 | $ 6,053 | ||
Term Loans | ||||
Long term debt | ||||
Effective interest rate (as percentage) | 9.90% | |||
Interest | $ 158 | |||
Debt Discount and Fees | 38 | |||
Issuance Costs | 3 | |||
Total Interest Expense | $ 199 | |||
PPP Loan | ||||
Long term debt | ||||
Effective interest rate (as percentage) | 1% | |||
Interest | $ 6 | |||
Total Interest Expense | $ 6 |
Notes Payable, Preferred Stoc_8
Notes Payable, Preferred Stock and Stock Purchase Warrants - Scheduled Maturities (Details) $ in Thousands | Sep. 30, 2023 USD ($) |
Scheduled maturities | |
2025 | $ 20,399 |
2026 | 7,397 |
Thereafter | 19,341 |
Total | $ 47,137 |
Stockholders' Equity (Deficit)
Stockholders' Equity (Deficit) (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||
Aug. 07, 2023 | Aug. 31, 2023 | Nov. 30, 2021 | Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Class of Stock [Line Items] | ||||||||
Proceeds form offering | $ 26,439 | $ 7,376 | $ 34,443 | |||||
Open Market Sale Agreement | ||||||||
Class of Stock [Line Items] | ||||||||
Proceeds from issuance of common stock, net | $ 7,400 | $ 34,400 | ||||||
Shares issued | 9,944,663 | 15,160,899 | ||||||
Open Market Sale Agreement | Jefferies LLC | ||||||||
Class of Stock [Line Items] | ||||||||
Proceeds form offering | $ 106,600 | |||||||
Proceeds from issuance of common stock, net | $ 7,400 | $ 34,400 | ||||||
Shares issued | 9,944,663 | 15,160,899 | ||||||
Open Market Sale Agreement | Maximum | ||||||||
Class of Stock [Line Items] | ||||||||
Proceeds form offering | $ 150,000 | |||||||
Percentage of commission on proceeds from common stock | 3% | |||||||
Open Market Sale Agreement | Maximum | Jefferies LLC | ||||||||
Class of Stock [Line Items] | ||||||||
Proceeds form offering | $ 150,000 | |||||||
Percentage of commission on proceeds from common stock | 3% | |||||||
Equity Distribution Agreement | ||||||||
Class of Stock [Line Items] | ||||||||
Shares issued | 0 | |||||||
Equity Distribution Agreement | Goldman Sachs LLC [Member] | ||||||||
Class of Stock [Line Items] | ||||||||
Proceeds form offering | $ 0 | |||||||
Equity Distribution Agreement | Maximum | Goldman Sachs LLC [Member] | ||||||||
Class of Stock [Line Items] | ||||||||
Proceeds form offering | $ 106,600 | |||||||
Percentage of commission on proceeds from common stock | 3% | |||||||
2021 Sales Agreement | Jefferies LLC | ||||||||
Class of Stock [Line Items] | ||||||||
Proceeds form offering | $ 106,600 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details) | 1 Months Ended | 9 Months Ended | ||||
Jan. 30, 2023 shares | Feb. 01, 2020 shares | Feb. 29, 2016 shares | Dec. 31, 2015 | Sep. 30, 2023 item shares | May 30, 2019 shares | |
2015 Equity Incentive Plan | ||||||
Stock-based compensation | ||||||
Expiration period | 10 years | |||||
Automatic annual increase in shares authorized, percent of common stock outstanding | 3.50% | |||||
Shares available for grant | 28,974,957 | |||||
Inducement Plan | ||||||
Stock-based compensation | ||||||
Shares available for grant | 172,256 | |||||
Total shares that may be issued | 1,800,000 | |||||
Commercial Equity Plan | ||||||
Stock-based compensation | ||||||
Shares available for grant | 7,062,500 | |||||
Total shares that may be issued | 10,000,000 | |||||
Stock issued | 2,937,500 | |||||
2016 Employee Stock Purchase Plan | ||||||
Stock-based compensation | ||||||
Automatic annual increase in shares authorized, percent of common stock outstanding | 1% | |||||
Total shares that may be issued | 800,000 | 17,624,582 | ||||
Payroll deductions for ESPP participants (as a percent) | 15% | |||||
Percentage on share price issued | 85% | |||||
Offering period duration | 6 months | |||||
Purchase periods | item | 2 | |||||
Stock issued | 566,573 | 222,312 | ||||
1997 Stock Option Plan | ||||||
Stock-based compensation | ||||||
Options vested and expected to vest | 1,026,870 |
Fair Value Measurements - Recur
Fair Value Measurements - Recurring (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2023 | Dec. 31, 2022 | |
Fair Value Measurements | ||
Cash and cash equivalents | $ 55,759 | $ 35,793 |
Marketable securities | 69,648 | 120,475 |
Derivative liabilities | $ 245 | 52,050 |
2025 Notes | ||
Reconciliation of items measured at fair value on a recurring basis that used significant unobservable inputs (Level 3) | ||
Fair Value, Liability, Recurring Basis, Unobservable Input Reconciliation, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Nonoperating Income (Expense) | |
Recurring | Embedded conversion option | 2023 Notes | ||
Fair Value Measurements | ||
Derivative liabilities | 20 | |
Recurring | Embedded conversion option | PHC Notes | ||
Fair Value Measurements | ||
Derivative liabilities | 44,191 | |
Recurring | Embedded conversion option | 2025 Notes | ||
Fair Value Measurements | ||
Derivative liabilities | $ 245 | 7,859 |
Recurring | Money market funds | ||
Fair Value Measurements | ||
Cash and cash equivalents | 52,696 | 34,658 |
Recurring | Corporate debt securities | ||
Fair Value Measurements | ||
Marketable securities | 7,920 | 32,142 |
Recurring | Commercial paper | ||
Fair Value Measurements | ||
Marketable securities | 26,281 | 41,503 |
Recurring | Asset backed Securities | ||
Fair Value Measurements | ||
Marketable securities | 8,260 | |
Recurring | Government and agency securities | ||
Fair Value Measurements | ||
Marketable securities | 35,447 | 38,570 |
Recurring | Level 1 | Money market funds | ||
Fair Value Measurements | ||
Cash and cash equivalents | 52,696 | 34,658 |
Recurring | Level 1 | Government and agency securities | ||
Fair Value Measurements | ||
Marketable securities | 35,447 | 31,627 |
Recurring | Level 2 | Embedded conversion option | 2023 Notes | ||
Fair Value Measurements | ||
Derivative liabilities | 20 | |
Recurring | Level 2 | Corporate debt securities | ||
Fair Value Measurements | ||
Marketable securities | 7,920 | 32,142 |
Recurring | Level 2 | Commercial paper | ||
Fair Value Measurements | ||
Marketable securities | 26,281 | 41,503 |
Recurring | Level 2 | Asset backed Securities | ||
Fair Value Measurements | ||
Marketable securities | 8,260 | |
Recurring | Level 2 | Government and agency securities | ||
Fair Value Measurements | ||
Marketable securities | 6,943 | |
Recurring | Level 3 | ||
Reconciliation of items measured at fair value on a recurring basis that used significant unobservable inputs (Level 3) | ||
Balance at the beginning of the period | 52,050 | |
Conversion of financial instruments | (1,109) | |
Balance at the end of the period | 245 | |
Recurring | Level 3 | PHC Notes | ||
Reconciliation of items measured at fair value on a recurring basis that used significant unobservable inputs (Level 3) | ||
(Gain) Loss on change in fair value of derivatives | (44,191) | |
Recurring | Level 3 | 2025 Notes | ||
Reconciliation of items measured at fair value on a recurring basis that used significant unobservable inputs (Level 3) | ||
(Gain) Loss on change in fair value of derivatives | (6,505) | |
Recurring | Level 3 | Embedded conversion option | PHC Notes | ||
Fair Value Measurements | ||
Derivative liabilities | 44,191 | |
Recurring | Level 3 | Embedded conversion option | 2025 Notes | ||
Fair Value Measurements | ||
Derivative liabilities | $ 245 | $ 7,859 |
Fair Value Measurements - Valua
Fair Value Measurements - Valuation Assumptions (Details) - Recurring - Level 3 | Sep. 30, 2023 | Dec. 31, 2022 |
2025 Notes | Stock price volatility | ||
Fair value valuation assumptions | ||
Embedded Derivative Liability, Measurement Input | 0.450 | 1.100 |
2025 Notes | Probabilities of conversion provisions | Minimum | ||
Fair value valuation assumptions | ||
Embedded Derivative Liability, Measurement Input | 0.050 | 0.050 |
2025 Notes | Probabilities of conversion provisions | Maximum | ||
Fair value valuation assumptions | ||
Embedded Derivative Liability, Measurement Input | 0.850 | 0.100 |
2025 Notes | Credit spread | ||
Fair value valuation assumptions | ||
Embedded Derivative Liability, Measurement Input | 0.095 | 0.1396 |
2025 Notes | Recovery rate | ||
Fair value valuation assumptions | ||
Embedded Derivative Liability, Measurement Input | (0.0156) | |
PHC Notes | Stock price volatility | ||
Fair value valuation assumptions | ||
Embedded Derivative Liability, Measurement Input | 0.990 | |
PHC Notes | Probabilities of conversion provisions | Minimum | ||
Fair value valuation assumptions | ||
Embedded Derivative Liability, Measurement Input | 0.050 | |
PHC Notes | Probabilities of conversion provisions | Maximum | ||
Fair value valuation assumptions | ||
Embedded Derivative Liability, Measurement Input | 0.100 | |
PHC Notes | Credit spread | ||
Fair value valuation assumptions | ||
Embedded Derivative Liability, Measurement Input | 0.1396 | |
PHC Notes | Recovery rate | ||
Fair value valuation assumptions | ||
Embedded Derivative Liability, Measurement Input | (0.0551) |
Income Taxes - Tax Provision (D
Income Taxes - Tax Provision (Details) - USD ($) | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Income Taxes | ||
Income tax provision | $ 0 | $ 0 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Related Party Transaction [Line Items] | |||||
Revenue, primarily from a related party | $ 6,097 | $ 4,622 | $ 14,360 | $ 10,818 | |
Related Party | |||||
Related Party Transaction [Line Items] | |||||
Revenue, primarily from a related party | 5,671 | $ 4,496 | 13,184 | 10,263 | |
Due from related party | 2,749 | 2,749 | $ 2,324 | ||
Due to related parties | 277 | 277 | 837 | ||
Ascensia | Related Party | |||||
Related Party Transaction [Line Items] | |||||
Revenue, primarily from a related party | 13,200 | 10,300 | |||
Expense to related party | 600 | $ 200 | |||
Due from related party | 2,700 | 2,700 | 2,300 | ||
Due to related parties | $ 500 | $ 500 | $ 900 |