Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2023 | Aug. 02, 2023 | |
Document and Entity Information | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Jun. 30, 2023 | |
Entity File Number | 001-37846 | |
Entity Registrant Name | QUOIN PHARMACEUTICALS LTD. | |
Entity Incorporation, State or Country Code | L3 | |
Entity Tax Identification Number | 92-2593104 | |
Entity Address, Address Line One | 42127 Pleasant Forest Court | |
Entity Address State Or Province | VA | |
Entity Address, City or Town | Ashburn | |
Entity Address, Postal Zip Code | 20148 | |
City Area Code | 703 | |
Local Phone Number | 980-4182 | |
Title of 12(g) Security | American Depositary Shares | |
Trading Symbol | QNRX | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Current Fiscal Year End Date | --12-31 | |
Amendment Flag | false | |
Entity Central Index Key | 0001671502 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q2 | |
Ordinary shares | ||
Document and Entity Information | ||
Entity Common Stock, Shares Outstanding | 59,233,024,799 | |
ADS | ||
Document and Entity Information | ||
Entity Common Stock, Shares Outstanding | 987,217 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 4,759,129 | $ 2,860,628 |
Investments | 10,680,160 | 9,992,900 |
Prepaid expenses | 234,226 | 516,584 |
Total current assets | 15,673,515 | 13,370,112 |
Prepaid expenses - long term | 383,390 | 383,390 |
Intangible assets, net | 652,539 | 704,561 |
Total assets | 16,709,444 | 14,458,063 |
Current liabilities: | ||
Accounts payable | 707,935 | 605,600 |
Accrued expenses | 1,834,653 | 1,175,705 |
Accrued interest and financing expense | 1,146,251 | 1,146,251 |
Due to officers - short term | 725,000 | 600,000 |
Total current liabilities | 4,413,839 | 3,527,556 |
Due to officers - long term | 3,223,733 | 3,523,733 |
Total liabilities | 7,637,572 | 7,051,289 |
Commitments and contingencies | ||
Other Liability, Current, Related Party, Type [Extensible Enumeration] | srt:OfficerMember | srt:OfficerMember |
Other Liability, Noncurrent, Related Party, Type [Extensible Enumeration] | srt:OfficerMember | srt:OfficerMember |
Shareholders' equity: | ||
Ordinary shares, no par value per share, 500,000,000,000 ordinary shares authorized - 59,233,024,799 (987,217 ADS's) ordinary shares issued and outstanding at June 30, 2023 and 24,233,024,799 (403,884 ADS's) at December 31, 2022 | $ 0 | $ 0 |
Treasury stock, 2,641,693, ordinary shares | (2,932,000) | (2,932,000) |
Additional paid in capital | 54,230,635 | 47,855,521 |
Accumulated deficit | (42,226,763) | (37,516,747) |
Total shareholders' equity | 9,071,872 | 7,406,774 |
Total liabilities and shareholders' equity | $ 16,709,444 | $ 14,458,063 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | 6 Months Ended | 12 Months Ended |
Jun. 30, 2023 | Dec. 31, 2022 | |
Ordinary shares, par value | $ 0 | $ 0 |
Ordinary shares, shares authorized | 500,000,000,000 | 500,000,000,000 |
Ordinary shares, shares issued | 59,233,024,799 | 24,233,024,799 |
Ordinary shares, shares outstanding | 59,233,024,799 | 24,233,024,799 |
Treasury Stock, ordinary shares | 2,641,693 | 2,641,693 |
ADS | ||
Ordinary shares, shares issued | 987,217 | 403,884 |
Ordinary shares, shares outstanding | 987,217 | 403,884 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Operating expenses | ||||
General and administrative | $ 1,634,960 | $ 1,941,473 | $ 3,318,777 | $ 3,529,943 |
Research and development | 625,104 | 726,694 | 1,716,837 | 1,314,263 |
Total operating expenses | 2,260,064 | 2,668,167 | 5,035,614 | 4,844,206 |
Other (income) and expenses | ||||
Forgiveness of accounts payable | (416,000) | |||
Warrant liability (income) expense | (77,237) | |||
Unrealized loss | 34,472 | 14,045 | ||
Interest income | (187,589) | (339,643) | ||
Total other income | (153,117) | (325,598) | (493,237) | |
Net loss | $ (2,106,947) | $ (2,668,167) | $ (4,710,016) | $ (4,350,969) |
ADS | ||||
Loss per ADS | ||||
Basic | $ (2.13) | $ (38.91) | $ (5.79) | $ (69.90) |
Fully-diluted | $ (2.13) | $ (38.91) | $ (5.79) | $ (69.90) |
Weighted average number of ADS's outstanding | ||||
Basic | 987,217 | 68,573 | 813,184 | 62,242 |
Fully-diluted | 987,217 | 68,573 | 813,184 | 62,242 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Shareholders' Equity - USD ($) | Common Stock | Treasury Stock | Additional Paid In Capital | Accumulated Deficit | ADS | Total |
Balance at beginning of year at Dec. 31, 2021 | $ (2,932,000) | $ 31,659,017 | $ (28,069,985) | $ 657,032 | ||
Balance at beginning of year (in shares) at Dec. 31, 2021 | 3,354,650,799 | 55,911 | ||||
Net loss | (1,682,802) | (1,682,802) | ||||
Cashless exercise of warrants (in shares) | 3,200 | |||||
Reclassification of warrant liability upon issuance of Exchange warrant | 296,362 | 296,362 | ||||
Balance at end of year at Mar. 31, 2022 | (2,932,000) | 31,955,379 | (29,752,787) | (729,408) | ||
Balance at ending of year (in shares) at Mar. 31, 2022 | 3,354,653,999 | 55,911 | ||||
Balance at beginning of year at Dec. 31, 2021 | (2,932,000) | 31,659,017 | (28,069,985) | 657,032 | ||
Balance at beginning of year (in shares) at Dec. 31, 2021 | 3,354,650,799 | 55,911 | ||||
Net loss | (4,350,969) | |||||
Balance at end of year at Jun. 30, 2022 | (2,932,000) | 32,184,820 | (32,420,954) | (3,168,134) | ||
Balance at ending of year (in shares) at Jun. 30, 2022 | 5,065,154,799 | 84,419 | ||||
Balance at beginning of year at Mar. 31, 2022 | (2,932,000) | 31,955,379 | (29,752,787) | (729,408) | ||
Balance at beginning of year (in shares) at Mar. 31, 2022 | 3,354,653,999 | 55,911 | ||||
Net loss | (2,668,167) | (2,668,167) | ||||
Cashless exercise of warrants (in shares) | 1,710,500,800 | 28,508 | ||||
Stock based compensation | 229,441 | 229,441 | ||||
Balance at end of year at Jun. 30, 2022 | (2,932,000) | 32,184,820 | (32,420,954) | (3,168,134) | ||
Balance at ending of year (in shares) at Jun. 30, 2022 | 5,065,154,799 | 84,419 | ||||
Balance at beginning of year at Dec. 31, 2022 | (2,932,000) | 47,855,521 | (37,516,747) | $ 7,406,774 | ||
Balance at beginning of year (in shares) at Dec. 31, 2022 | 24,233,024,799 | 403,884 | 24,233,024,799 | |||
Net loss | (2,603,069) | $ (2,603,069) | ||||
Stock based compensation | 261,472 | 261,472 | ||||
Issuance of ADS and Pre-Funded Warrants, net | 5,849,266 | 5,849,266 | ||||
Issuance of ADS and Pre-Funded Warrants, net (in shares) | 35,000,000,000 | 583,333 | ||||
Balance at end of year at Mar. 31, 2023 | (2,932,000) | 53,966,259 | (40,119,816) | 10,914,443 | ||
Balance at ending of year (in shares) at Mar. 31, 2023 | 59,233,024,799 | 987,217 | ||||
Balance at beginning of year at Dec. 31, 2022 | (2,932,000) | 47,855,521 | (37,516,747) | $ 7,406,774 | ||
Balance at beginning of year (in shares) at Dec. 31, 2022 | 24,233,024,799 | 403,884 | 24,233,024,799 | |||
Net loss | $ (4,710,016) | |||||
Balance at end of year at Jun. 30, 2023 | (2,932,000) | 54,230,635 | (42,226,763) | $ 9,071,872 | ||
Balance at ending of year (in shares) at Jun. 30, 2023 | 59,233,024,799 | 987,217 | 59,233,024,799 | |||
Balance at beginning of year at Mar. 31, 2023 | (2,932,000) | 53,966,259 | (40,119,816) | $ 10,914,443 | ||
Balance at beginning of year (in shares) at Mar. 31, 2023 | 59,233,024,799 | 987,217 | ||||
Net loss | (2,106,947) | (2,106,947) | ||||
Stock based compensation | 264,376 | 264,376 | ||||
Balance at end of year at Jun. 30, 2023 | $ (2,932,000) | $ 54,230,635 | $ (42,226,763) | $ 9,071,872 | ||
Balance at ending of year (in shares) at Jun. 30, 2023 | 59,233,024,799 | 987,217 | 59,233,024,799 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows - USD ($) | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Cash flows used in operating activities: | ||
Net loss | $ (4,710,016) | $ (4,350,969) |
Change in fair value of warrant liability | (77,237) | |
Stock based compensation | 525,848 | 229,441 |
Forgiveness of trade payable | (416,000) | |
Amortization of intangibles | 52,022 | 52,021 |
Increase in accrued interest and financing expense | (311,670) | |
Unrealized loss and accrued interest on investments | (230,755) | |
Changes in assets and liabilities: | ||
Increase in accounts payable and accrued expenses | 761,283 | 440,817 |
Decrease in prepaid expenses & other assets | 282,358 | 188,671 |
Net cash used in operating activities | (3,319,260) | (4,244,926) |
Cash flows used in investing activities: | ||
Purchase of investments | (13,491,505) | |
Proceeds from maturity of investments | 13,035,000 | |
Payment for license acquisition | (250,000) | |
Net cash used in investing activities | (456,505) | (250,000) |
Cash flows provided by (used in) financing activities: | ||
Payment of amounts due to officers | (175,000) | (300,000) |
Proceeds from sale of equity securities, net | 5,849,266 | |
Net cash provided by (used in) financing activities | 5,674,266 | (300,000) |
Net change in cash and cash equivalents: | 1,898,501 | (4,794,926) |
Cash and cash equivalents - beginning of period | 2,860,628 | 7,482,773 |
Cash and cash equivalents - end of period | 4,759,129 | 2,687,847 |
Supplemental information - Non cash items: | ||
Reclassification of warrant liability to equity upon issuance of "Exchange warrants" | $ 296,362 | |
Offering expenses associated with warrant modification | $ 238,231 |
ORGANIZATION AND BUSINESS
ORGANIZATION AND BUSINESS | 6 Months Ended |
Jun. 30, 2023 | |
ORGANIZATION AND BUSINESS | |
ORGANIZATION AND BUSINESS | NOTE 1 – ORGANIZATION AND BUSINESS Quoin Pharmaceuticals Ltd. (“Quoin Ltd.,” or the “Company”), formerly known as Cellect Biotechnology Ltd. (“Cellect”), is the holding company for Quoin Pharmaceuticals, Inc., a Delaware corporation (“Quoin Inc.”). On October 28, 2021, Cellect completed the business combination with Quoin Inc., with Quoin Inc. surviving as a wholly-owned subsidiary of Cellect (the “Merger”). Immediately after completion of the Merger, Cellect changed its name to “Quoin Pharmaceuticals Ltd.” Effective July 18, 2023, the ratio of American Depositary Shares (“ADSs”) evidencing ordinary shares changed from 1 ADS representing five thousand (5,000) ordinary shares to 1 ADS representing sixty thousand (60,000) ordinary shares, which resulted in a 1 for 12 reverse split of the issued and outstanding ADSs (the “Ratio Change”). All ADSs and related option and warrant information presented in these financial statements and accompanying footnotes has been retroactively adjusted to reflect the number of ADSs resulting from the Ratio Change. Quoin Inc. was incorporated in Delaware on March 5, 2018. Quoin Inc. is clinical stage specialty pharmaceutical company dedicated to the development and commercialization of therapeutic products that treat rare and orphan diseases for which there are currently no approved treatments or cures. The Company’s initial focus is on the development of products, using proprietary owned and in-licensed drug delivery technologies, that could help address rare skin diseases. The Company’s first lead product is QRX003, a once daily, topical lotion comprised of a broad-spectrum serine protease inhibitor, formulated with the proprietary in-licensed Invisicare® technology, is under development as a potential treatment for Netherton Syndrome (“NS”), a rare hereditary genetic disease. QRX003 is currently being tested in two clinical studies in the United States (“U.S.”) under an open Investigational New Drug (“IND”) application with the Food and Drug Administration (“FDA”). Dosing of patients commenced in December 2022 for the first study and in March 2023 for the second study. The Company is also developing QRX004 as a potential treatment for Recessive Dystrophic Epidermolysis Bullosa (“RDEB”). In addition, the Company has entered into Research Agreements with the Queensland University of Technology (“QUT”), which include an option for global licenses to QRX007 for the potential treatment of NS and QRX008 for the potential treatment of scleroderma. To date, no products have been commercialized and revenue has not been generated. |
LIQUIDITY RISKS AND OTHER UNCER
LIQUIDITY RISKS AND OTHER UNCERTAINTIES | 6 Months Ended |
Jun. 30, 2023 | |
LIQUIDITY RISKS AND OTHER UNCERTAINTIES | |
LIQUIDITY RISKS AND OTHER UNCERTAINTIES | NOTE 2 - LIQUIDITY RISKS AND OTHER UNCERTAINTIES The unaudited condensed consolidated financial statements have been prepared in conformity with generally accepted accounting principles in the United States (“U.S. GAAP”), which contemplates continuation of the Company as a going concern. The Company has incurred net losses every year since inception and has an accumulated deficit of approximately $42.2 million at June 30, 2023. The Company has limited operating history and has historically funded its operations through debt and equity financings. The Company incurred net losses of approximately $4.7 million, and negative cash flows from operations of $3.3 million for the six months ended June 30, 2023. At June 30, 2023, the Company had cash balances totaling $4.8 million and investments of $10.7 million. The Company has determined that it has sufficient cash and liquidity to effect its business plan for at least one year from the issuance of these unaudited condensed consolidated financial statements. Additional financing will still be required to complete the research and development of the Company’s therapeutic targets and its other operating requirements until it achieves commercial profitability, if ever. Such financing may not be available at acceptable terms, if at all. If the Company is unable to obtain additional funding when it becomes necessary, the development of its product candidates will be impacted and the Company would likely be forced to delay, reduce, or terminate some or all of its development programs, all of which could have a material adverse effect on the Company’s business and financial condition. Other risks and uncertainties: The Company is subject to risks common to development stage biopharmaceutical companies including, but not limited to, new technological innovations, dependence on key personnel, protection of proprietary technology, compliance with government regulations, product liability, pre-clinical and clinical trial outcome risks, regulatory approval risks, uncertainty of market acceptance and additional financing requirements. The Company’s products require approval or clearance from the FDA prior to commencing commercial sales in the United States. There can be no assurance that the Company’s products will receive all of the required approvals or clearances. Approvals or clearances are also required in foreign jurisdictions in which the Company may license or sell its products. There can be no assurance that the Company’s products, if approved, will be accepted in the marketplace, nor can there be any assurance that any future products can be developed or manufactured at an acceptable cost and with appropriate performance characteristics, or that such products will be successfully marketed. The Company is also dependent on several third party suppliers, in some cases a single source supplier including the contract research organization managing both of the Company’s current clinical studies, the supplier of the active pharmaceutical ingredient (API), as well as the contract manufacturer of the drug substance for the expected clinical development. Nasdaq Listing On April 5, 2023, the Company received a letter from the Listing Qualifications staff of The Nasdaq Stock Market, LLC (“Nasdaq”) notifying the Company that the closing bid price per ADS was below the required minimum of $1.00 for a period of 30 consecutive business days and that the Company did not meet the minimum bid price requirements set forth in Nasdaq Listing Rule 5550(a)(2). Pursuant to Nasdaq Rule 5810(c)(3)(A), the Company had a period of one hundred eighty (180) calendar days, or until October 2, 2023 (the “Compliance Period”), to regain compliance with Nasdaq’s minimum bid price requirement. On August 1, 2023, the Company received a letter from Nasdaq stating that the Company’s closing bid price per ADS was at $1.00 or greater for the last 10 consecutive business days. Accordingly, the Company regained compliance with Listing Rule 5550(a)(2) and the matter was closed. There can be no assurance that the Company will be able to maintain compliance with Nasdaq’s minimum bid-price requirement for continued listing. If the Company’s ADSs are delisted from Nasdaq, it will have a material negative impact on the actual and potential liquidity of the Company’s securities, as well as a material negative impact on the Company’s ability to raise future capital. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jun. 30, 2023 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation: The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. GAAP for interim financial information. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, such statements include all adjustments (consisting only of normal recurring items) which are considered necessary for a fair presentation of the unaudited condensed consolidated financial statements of the Company as of June 30, 2023 and for the three and six months then ended. The results of operations for the three and six months ended June 30, 2023 are not necessarily indicative of the operating results for the year or any other period. These unaudited condensed consolidated financial statements should be read in conjunction with the audited financial statements and related disclosures as of December 31, 2022 and for the year then ended which are included in the Company’s Annual Report on Form 10- K, filed with the SEC on March 15, 2023. The Company operates in one segment. Use of estimates: The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts in the financial statements and accompanying notes. Actual results could materially differ from those estimates. Management considers many factors in developing the estimates and assumptions that are used in the preparation of these financial statements including: expected business and operational changes, sensitivity and volatility associated with the assumptions used in developing estimates, and whether historical trends are expected to be representative of future trends. The estimation process often may yield a range of potentially reasonable estimates of the ultimate future outcomes and management must select an amount that falls within that range of reasonable estimates. Estimates are used in the following areas, among others: stock-based compensation research and development expense recognition, intangible asset estimated useful lives and impairment assessments, allowances of deferred tax assets, and cash flow assumptions regarding going concern considerations. Cash and cash equivalents: The Company considers all highly liquid investments and short-term debt instruments with original maturities of three months or less to be cash equivalents. The Company, from time to time during the periods presented, has had bank account balances in excess of federally insured limits where substantially all cash is held in the United States. The Company has not experienced losses in such accounts. The Company believes that it is not subject to unusual credit risk beyond the normal credit risk associated with commercial banking relationships. Warrants: The Company classifies as equity any contracts that (i) require physical settlement or net-share settlement or (ii) provide the Company with a choice of net-cash settlement or settlement in its own shares (physical settlement or net-share settlement) provided that such contracts are indexed to the Company’s own stock. The Company classifies as assets or liabilities any contracts that (i) require net-cash settlement (including a requirement to net cash settle the contract if an event occurs and if that event is outside the Company’s control) or (ii) give the counterparty a choice of net-cash settlement or settlement in shares (physical settlement or net-share settlement). The Company assesses classification of its warrants and other free-standing derivatives at each reporting date to determine whether a change in classification between assets, liabilities and equity is required. The Company evaluated the warrants to assess their proper classification using the applicable criteria enumerated under U.S. GAAP and determined that such warrants meet the criteria for equity classification in the accompanying unaudited condensed consolidated balance sheets as of June 30, 2023 and December 31, 2022, respectively. Investments: Investments as of June 30, 2023 and December 31, 2022 consist of U.S. Treasury Bills, which are classified as trading securities, totaling $ 10.7 million and $10.0 million, respectively. The Company determines the appropriate balance sheet classification of its investments at the time of purchase and evaluates the classification at each balance sheet date. Long-lived assets: Long-lived assets are comprised of acquired technology and licensed rights to use technology, which are considered platform technology with alternative future uses beyond the current products in development. Such intangible assets are being amortized on a straight-line basis over their expected useful life of 10 years. The Company assesses the impairment for long-lived assets whenever events or circumstances indicate the carrying value may not be recoverable. Factors we consider that could trigger an impairment review include the following: ● Significant changes in the manner of the Company’s use of the acquired assets or the strategy for its overall business, ● Significant underperformance relative to expected historical or projected development milestones, ● Significant negative regulatory or economic trends, and ● Significant technological changes which could render the platform technology obsolete. The Company recognizes impairment when the sum of the expected undiscounted future cash flows is less than the carrying amount of the asset. Impairment losses, if any, are measured as the excess of the carrying amount of the asset over its estimated fair value. During the three and six months ended June 30, 2023 and 2022, there were no impairment indicators which required an impairment loss measurement. Research and development: Research and development costs are expensed as incurred. Research and development expenses include personnel costs associated with research and development activities, including third-party contractors to perform research, conduct clinical trials and manufacture drug supplies and materials. The Company accrues for costs incurred by external service providers, including contract research organizations and clinical investigators, based on its estimates of service performed and costs incurred. These estimates include the level of services performed by third parties, patient enrollment in clinical trials when applicable, administrative costs incurred by third parties, and other indicators of the services completed. Based on the timing of amounts invoiced by service providers, the Company may also record payments made to those providers as prepaid expenses that will be recognized as expenses in future periods as the related services are rendered. Income taxes: The Company accounts for its income taxes using the asset and liability method. Accordingly, deferred tax assets and liabilities are recognized for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and tax credit carry-forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. The Company maintains a full valuation allowance on its existing deferred tax assets. The Company also accounts for uncertain tax positions using the more-likely-than-not threshold for financial statement recognition and measurement of a tax position taken in the Company’s income tax returns. As of June 30, 2023 and December 31, 2022, the Company had no uncertain tax positions which affected its financial position and its results of operations or its cash flows and will continue to evaluate for uncertain tax positions in the future. If at any time the Company should record interest and penalties in connection with income taxes, the interest and the penalties will be expensed within the interest and general and administrative expenses, respectively. Stock based compensation: The Company recognizes compensation costs resulting from the issuance of stock-based awards to employees, non-employees and directors as an expense in the consolidated statements of operations over the requisite service period based on a measurement of fair value for each stock-based award. The fair value of each option grant is estimated as of the date of grant using the Black-Scholes option-pricing model, net of actual forfeitures. The fair value is amortized as compensation cost on a straight-line basis over the requisite service period of the awards, which is generally the vesting period. The Company’s expected stock volatility is based on the historical data regarding the volatility of a publicly traded set of peer companies, since it has a limited history of trading as a public company. The Company utilizes the simplified method to estimate the expected term. The risk-free interest rate was determined by reference to the U.S. Treasury yield curve in effect at the time of grant of the award for time periods approximately equal to the expected term of the award. The expected dividend yield was assumed to be zero as the Company has not paid and dividends since its inception and does not anticipate paying dividends in the foreseeable future. Fair value of financial instruments: The Company considers its cash and cash equivalents, investments, accounts payable, accrued expenses to meet the definition of financial instruments. The carrying amounts of these financial instruments approximated their fair values due to the short maturities. The Company measures fair value as required by ASC Topic 820, Fair Value Measurements and Disclosures Earnings (loss) per share: The Company reports loss per share in accordance with ASC 260-10, Earnings Per Share For the three and six months ended June 30, 2023, the number of shares excluded from the diluted net earnings (loss) per share included outstanding warrants to purchase 864,068 ADS and outstanding stock options to purchase 25,595 ADS. For the three and six months ended June 30, 2022, the number of shares excluded from the diluted net earnings (loss) per share included warrants to purchase 87,742 ADSs and outstanding options to purchase 25,760 ADSs, respectively. The inclusion of these stock options and warrants from both periods in 2023 and 2022 in the denominator would be anti-dilutive. |
ACCRUED INTEREST AND FINANCING
ACCRUED INTEREST AND FINANCING EXPENSE | 6 Months Ended |
Jun. 30, 2023 | |
ACCRUED INTEREST AND FINANCING EXPENSE | |
ACCRUED INTEREST AND FINANCING EXPENSE | NOTE 4 – ACCRUED INTEREST AND FINANCING EXPENSE On October 2, 2020, Quoin Inc. commenced an offering of promissory notes (the “2020 Notes”) and warrants to certain investors (“2020 Noteholders”). 2020 Notes were mandatorily convertible into 432 ADSs in 2021. The ADSs issued to the 2020 Noteholders did not include the accrued interest which was estimated to be approximately $744,000 at December 31, 2021 of which $312,000 was paid to two of the five 2020 Noteholders during the year ended December 31, 2022. Based on the terms of the cash settlement with these two 2020 Noteholders, the Company’s estimate of the liability to the remaining three 2020 Noteholders was $1,146,000 as of June 30, 2023 and December 31, 2022. There was no interest expense recognized in both the three and six month periods ended June 30, 2023 and 2022. |
FAIR VALUE OF FINANCIAL INSTRUM
FAIR VALUE OF FINANCIAL INSTRUMENTS | 6 Months Ended |
Jun. 30, 2023 | |
FAIR VALUE OF FINANCIAL INSTRUMENTS | |
FAIR VALUE OF FINANCIAL INSTRUMENTS | NOTE 5 - FAIR VALUE OF FINANCIAL INSTRUMENTS The Company applies fair value accounting for all assets and liabilities that are recognized or disclosed at fair value in the financial statements on a recurring basis. Fair value is defined as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities the Company considers the principal or most advantageous market in which it would transact and the market-based risk measurements or assumptions that market participants would use in pricing the asset or liability, such as risks inherent in valuation techniques, transfer restrictions and credit risk. For certain instruments, including cash and cash equivalents, accounts payable, and accrued expenses, it was estimated that the carrying amount approximated fair value because of the short maturities of these instruments. Fair value is estimated using various valuation models, which utilize certain inputs and assumptions that market participants would use in pricing the asset or liability. The inputs and assumptions used in valuation models are classified in the fair value hierarchy as follows: Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs. Level 2: Quoted market prices for similar instruments in an active market; quoted prices for identical or similar assets and liabilities in markets that are not active; and model-derived valuations inputs of which are observable and can be corroborated by market data. Level 3: Unobservable inputs and assumptions that are supported by little or no market activity and that are significant to the fair value of the asset and liability. The fair value hierarchy gives the lowest priority to Level 3 inputs. In determining the appropriate hierarchy levels, the Company analyzes the assets and liabilities that are subject to fair value disclosure. Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to their fair value measurement. The following table presents the Company’s assets and liabilities that are measured at fair value on a recurring basis by fair value hierarchy at June 30, 2023 and December 31, 2022: June 30, 2023 Level 1 Level 2 Level 3 Total US Treasury Bills $ 10,680,160 $ — $ — $ 10,680,160 Total US Treasury Bills Asset $ 10,680,160 $ — $ — $ 10,680,160 December 31, 2022 Level 1 Level 2 Level 3 Total US Treasury Bills $ 9,992,900 $ — $ — $ 9,992,900 Total US Treasury Bills Asset $ 9,992,900 $ — $ — $ 9,992,900 |
STOCK BASED COMPENSATION
STOCK BASED COMPENSATION | 6 Months Ended |
Jun. 30, 2023 | |
STOCK BASED COMPENSATION | |
STOCK BASED COMPENSATION | NOTE 6 – STOCK BASED COMPENSATION In March 2022, the Board of Directors of the Company approved the Amended and Restated Equity Incentive Plan (the “Amended Plan”), which was approved by the shareholders at the Company’s Annual General Meeting of Shareholders held on April 12, 2022. The Amended Plan increased the number of ordinary shares reserved for issuance under such equity incentive plan to 15% of the Company’s outstanding ordinary shares on a fully-diluted basis, or 16,891,925,220 ordinary shares represented by 281,532 ADSs as of June 30, 2023. Under the Amended Plan, the Company may grant options to its directors, officers, employees, consultants, advisers and service providers. As of June 30, 2023, 255,937 ADSs remained available for grant under the Amended Plan. The following table summarizes stock-based activities under the Amended Plan: Weighted Weighted Average Average ADS Underlying Exercise Contractual Options Price Terms Outstanding at December 31, 2022 25,595 $ 210.00 9.28 Granted — $ — Forfeited/Cancelled — $ — Outstanding at June 30, 2023 25,595 $ 210.00 8.78 Exercisable options at June 30, 2023 6,845 $ 210.00 8.78 The intrinsic value of outstanding options at June 30, 2023 was $0. Stock based compensation expense was approximately $264,000 ($34,000 included in research and development expense and $230,000 included in general and administrative expenses) in the three months ended June 30, 2023 and approximately $526,000 ($69,000 included in research and development expense and $457,000 included in general and administrative expenses) in the six months ended June 30, 2023. Stock based compensation expense was approximately $229,000 ($30,000 included in research and development expense and $199,000 included in general and administrative expenses) in both the three and six months ended June 30, 2022. At June 30, 2023, the total unrecognized compensation expense related to non-vested options was approximately $2,679,000 and is expected to be recognized over the remaining weighted average service period of approximately 2.60 years. |
PREPAID EXPENSES
PREPAID EXPENSES | 6 Months Ended |
Jun. 30, 2023 | |
PREPAID EXPENSES | |
PREPAID EXPENSES | NOTE 7 – PREPAID EXPENSES Prepaid expenses are as follows: June 30, December 31, 2023 2022 Prepaid R&D costs $ 383,390 $ 383,390 Prepaid insurance 202,226 508,084 Prepaid expense 32,000 8,500 Total $ 617,616 $ 899,974 Less: Short-term portion (234,226) (516,584) Long-term portion $ 383,390 $ 383,390 |
ACCRUED EXPENSES
ACCRUED EXPENSES | 6 Months Ended |
Jun. 30, 2023 | |
ACCRUED EXPENSES | |
ACCRUED EXPENSES | NOTE 8 - ACCRUED EXPENSES Accrued expenses are as follows: June 30, December 31, 2023 2022 Research contract expenses (note 12) $ 343,152 $ 105,071 Payroll (note 11) 1,168,486 788,169 Payroll taxes (note 11) 199,408 159,593 Professional fees 85,299 44,278 Other Expenses 38,308 78,594 Total $ 1,834,653 $ 1,175,705 |
IN-LICENSED TECHNOLOGY
IN-LICENSED TECHNOLOGY | 6 Months Ended |
Jun. 30, 2023 | |
IN-LICENSED TECHNOLOGY | |
IN-LICENSED TECHNOLOGY | NOTE 9 – IN-LICENSED TECHNOLOGY Polytherapeutics: On March 24, 2018, Quoin Inc. entered into a securities purchase agreement (the “Acquisition Agreement”), in which it agreed to acquire all of the equity interests in Polytherapeutics, Inc. (the “Seller” or “Polytherapeutics”) for $40,833 and future royalties provided Quoin Inc. commercializes products using the technology developed by the Seller. The terms of any royalty payments to the Seller are 4.0% of the net revenue of royalty products, as defined in the Acquisition Agreement during the ten (10) year period commencing from the date of first sale of a royalty product. If a generic product is introduced by a third party to the market, during the royalty period, the royalty fees shall be reduced from 4% to 2%. If, during the royalty period, two or more generic products are introduced, the royalty fees shall be reduced from 2% to 0%. Skinvisible: In October 2019, Quoin Inc. entered into the Exclusive Licensing Agreement (as amended from time to time, the “License Agreement”) with Skinvisible Pharmaceuticals, Inc. (“Skinvisible”), under which Skinvisible granted the Company an exclusive royalty-bearing license relating to the production and manufacture of prescription drug products related to certain patents held by Skinvisible, including those related to QRX003 and QRX004. The Company made Skinvisible a one-time non-refundable, non-creditable license fee of $1 million (the “License Fee”). In addition, the Company agreed to pay Skinvisible a single digit royalty percentage of the Company’s net sales revenues for any licensed product covered by the patent rights licensed under the License Agreement. The Company also agreed to pay Skinvisible 25% of any revenues the Company receives as royalties in the event that the Company sublicense any licensed products to a third party. The License Agreement also requires that the Company make a $5 million payment to Skinvisible upon receiving approval in the U.S. or European Union, whichever occurs first, for the first drug product developed using intellectual property licensed thereunder. |
INTANGIBLE ASSETS
INTANGIBLE ASSETS | 6 Months Ended |
Jun. 30, 2023 | |
INTANGIBLE ASSETS | |
INTANGIBLE ASSETS | NOTE 10 - INTANGIBLE ASSETS Intangible assets are as follows: June 30, December 31, 2023 2022 Acquired technology – Polytherapeutics $ 40,433 $ 40,433 Technology license – Skinvisible 1,000,000 1,000,000 Total cost 1,040,433 1,040,433 Accumulated amortization (387,894) (335,872) Net book value $ 652,539 $ 704,561 The Company recorded amortization expense of approximately $52,000 for the six months ended June 30, 2023 and 2022. The Company recorded amortization expense of approximately $26,000 for the three months ended June 30, 2023 and 2022. The annual amortization expense expected to be recorded for existing intangible assets for the years 2023 through 2026, and thereafter, is approximately $52,000, $104,000, $104,000, $104,000 and $288,000, respectively. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 6 Months Ended |
Jun. 30, 2023 | |
RELATED PARTY TRANSACTIONS | |
RELATED PARTY TRANSACTIONS | NOTE 11 - RELATED PARTY TRANSACTIONS Employment Agreements and Due to Officers/Founders: Due to the limited funding of Quoin Inc. prior to the consummation of the Merger, the compensation, including salary, office and car allowances and other benefits, due to Dr. Myers and Ms. Carter under their respective employment agreements, as well as reimbursement of expenses and other amounts paid to third parties on behalf of Quoin Inc., were accrued as indebtedness to Dr. Myers and Ms. Carter. Following the closing of the Merger, Quoin Inc. began making payments of $25,000 per month to each of Dr. Myers and Ms. Carter to repay As of June 30, 2023, approximately $2,109,000 and $1,840,000 of such indebtedness Amounts due to officers at June 30, 2023 and December 31, 2022 consisted of the following: June 30, December 31, 2023 2022 Salaries and other compensation $ 3,948,733 $ 4,108,500 Invoices paid on behalf of the Company — 15,232 Total $ 3,948,733 $ 4,123,732 Less: Short-term portion (725,000) (600,000) Long-term portion $ 3,223,733 $ 3,523,733 Expenses: Research and development expense, incurred in the three months ended June 30, 2023 and 2022, was $0 and $12,000 and it was $12,000 and $24,000 in the six months ended June 30, 2023 and 2022, respectively, for payments to the CEO Dr. Myers’ son, who had been consulting for the Company on research and development matters from time to time. As of March 31, 2023, Dr. Myers’ son no longer provided consulting services to the Company. Interest Payable: See Note 4 for interest payable on the 2020 Notes. |
RESEARCH, CONSULTING AGREEMENTS
RESEARCH, CONSULTING AGREEMENTS AND COMMITMENTS | 6 Months Ended |
Jun. 30, 2023 | |
RESEARCH, CONSULTING AGREEMENTS AND COMMITMENTS | |
RESEARCH, CONSULTING AGREEMENTS AND COMMITMENTS | NOTE 12 – RESEARCH, CONSULTING AGREEMENTS AND COMMITMENTS Research agreements In November 2020, Quoin Inc. entered into a Master Service Agreement for an initial term of three years with Therapeutics Inc. for managing preclinical and clinical development for new products in the field of dermatology. The agreement required the execution of individual work orders. Quoin Inc. may terminate any work order for any reason with 90 days written notice subject to costs incurred through termination and a defined termination fee, unless there is a material breach by Therapeutics Inc. A work order was entered into in June 2022 for the first QRX003 clinical study at an expected estimated cost of approximately $4.4 million through 2024. A further work order was entered into in December 2022 for the second QRX003 clinical study at an expected estimated cost of approximately $830,000 through 2024. For the three and six months ended June 30, 2023 and 2022, the Company incurred a research and development expense under these agreements of approximately $360,000 and $959,000, and $309,000 and $480,000 respectively. In November 2021, the Company entered into a commitment with Queensland University of Technology for research related services associated with Netherton Syndrome of approximately $250,000 for an expected period of eighteen months. For the three and six months ended June 30, 2023 and 2022, the Company incurred research and development costs related to this agreement of approximately $0 and $50,000, and $77,000 and $77,000 respectively. In May 2022, the Company entered into a commitment with Queensland University of Technology for research related services associated with Scleroderma of approximately $610,000 for an expected period of eighteen months. For the three and six months ended June 30, 2023 and 2022, the Company incurred research and development costs related to this agreement of approximately $138,000 and $226,000, and $-0- and $-0- respectively. Consulting agreement: Quoin Inc. entered into a consulting agreement with an Investor Relations (IR) firm, which provided for a monthly fee of $14,000. The agreement had an automatic annual renewal clause and was in effect in November 2017. The Company owed the IR firm $584,000 as of December 31, 2021. Effective March 31, 2022, the Company entered into a settlement agreement with the IR firm reducing the liability to $168,000 and recognized $416,000 as other income in the accompanying consolidated statement of operations. The liability was fully repaid as of April 1, 2023. No expenses were incurred in both the three and six months ended June 30, 2023 and 2022, respectively. Performance milestones and Royalties See Note 9 for asset and in-licensed technology commitments. |
SHAREHOLDERS' EQUITY
SHAREHOLDERS' EQUITY | 6 Months Ended |
Jun. 30, 2023 | |
SHAREHOLDERS' EQUITY | |
SHAREHOLDERS' EQUITY | The Company held its Annual General Meeting on April 12, 2022, at which the Company’s shareholders approved an increase to the authorized share capital to 50,000,000,000, no par value. The Company held a further Annual General Meeting on November 3, 2022, at which the Company’s shareholders approved an increase to the authorized share capital to 500,000,000,000 ordinary shares from 50,000,000,000, no par value. These ordinary shares are not redeemable and do not have any preemptive rights. Holders of the Company’s ordinary shares have one vote for each ordinary share held on all matters submitted to a vote of shareholders at a shareholders meeting. The board of directors shall determine and provide a record date for each shareholders meeting and all shareholders at such record date may vote. Unless stipulated differently in the Companies Law or in the articles of association, all shareholders’ resolutions shall be approved by a simple majority vote. Under Israeli law, the Company may declare and pay dividends only if, upon the determination of its board of directors, there is no reasonable concern that the distribution will prevent the Company from being able to meet the terms of its existing and foreseeable obligations as they become due. Under the Companies Law, the distribution amount is further limited to the greater of retained earnings or earnings generated over the two most recent years legally available for distribution according to the Company’s then last reviewed or audited financial statements, provided that the date of the financial statements is not more than six months prior to the date of distribution. In the event that the Company does not have retained earnings or earnings generated over the two most recent years legally available for distribution, the Company may seek the approval of the court in order to distribute a dividend. The court may approve the Company’s request if it determines that there is no reasonable concern that the payment of a dividend will prevent the Company from satisfying existing and foreseeable obligations as they become due. Each ADS will also represent any other securities, cash or other property which may be held by the depositary. ADSs may be held either (a) directly (1) by having an American Depositary Receipt, also referred to as an ADR, which is a certificate evidencing a specific number of ADSs or (2) by having uncertificated ADSs, or (b) indirectly by holding a security entitlement in ADSs through a broker or other financial institution that is a direct or indirect participant in The Depository Trust Company, also called DTC. February 2023 Offering On February 24, 2023 (the “February Closing Date”), the Company completed an offering (the “February Offering”) of 24,750,000,000 ordinary shares represented by 412,500 ADSs at a purchase price of $12.00 per ADS and a pre-funded warrant (the “February Pre-Funded Warrant”) to purchase 10,250,000,000 ordinary shares represented by 170,833 ADSs at a per pre-funded warrant price of $11.9988, with each ADS and February Pre-Funded Warrant accompanied by an ordinary warrant (the “February Common Warrant”) for aggregate gross proceeds of $7.0 million, resulting in net proceeds of approximately $5.8 million, after deducting the placement agent’s fees and offering expenses. Each February Common Warrant has an exercise price of $12.00 per ADS and expires on the fifth anniversary of the February Closing Date. On the February Closing Date, the holder of the February Pre-Funded Warrant exercised its Pre-Funded Warrant in full. In connection with the February Offering, the Company entered into a Securities Purchase Agreement (the “February Purchase Agreement”) with certain institutional investors. Under the February Purchase Agreement, subject to certain exemptions, the Company agreed not to: (i) for a period of ninety (90) days after the closing date of the February Offering, issue, enter into any agreement to issue or announce the issuance or proposed issuance of any ADSs, ordinary shares or ordinary share equivalents or (ii) file any registration statement or amendment or supplement thereto, other than a registration statement on Form S-8 in connection with any employee benefit plan or any post-effective amendment to a registration statement declared effective by the Securities and Exchange Commission (the “SEC”) and (ii) for a period of 180 days after the closing date of the February Offering, enter into an agreement to effect a “variable rate transaction” as defined in the Purchase Agreement. In connection with the February Offering, the Company entered into an Amendment No. 1 to Warrant to Purchase Ordinary Shares Represented by American Depositary Shares, dated February 24, 2023 (collectively, the “Warrant Amendments”), with each of the purchasers (the “2022 Purchasers”) who participated in both the Company’s offering completed in August 2022 (the “August Offering”) and February Offering. The Warrant Amendments amended certain terms of the Common Warrants issued in the August Offering to such 2022 Purchasers. Specifically, the Warrant Amendments reduced the exercise price of Common Warrants to purchase 235,833 ADSs out of the total 280,000 issued in the August Offering from $60.00 to $13.20 and extended the term during which those warrants could remain exercisable until February 24, 2028. The incremental fair value of the modified warrants was approximately $238,000, which was accounted for as an offering expense in connection with the February Offering. Warrants The following table summarizes warrant activities during the six months ended June 30, 2023: Weighted ADSs Average Underlying Exercise Price Warrants Per ADS Outstanding at December 31, 2022 280,735 $ 24.85 * Granted Common Warrants 583,333 12.00 Granted Pre-Funded Warrants 170,833 — Exercised Pre-Funded Warrants (170,833) — Outstanding and exercisable at June 30, 2023 864,068 $ 16.17 * Includes the reduction of the exercise price from $60.00 per ADS to $13.20 per ADS for Common Warrants issued in the August Offering to investors who participated in both the Company’s August Offering and February Offering, see above. |
CONTINGENCIES
CONTINGENCIES | 6 Months Ended |
Jun. 30, 2023 | |
CONTINGENCIES | |
CONTINGENCIES | NOTE 14 – CONTINGENCIES From time to time, the Company may become involved in various legal matters arising in the ordinary course of business. Management is unaware of any matters requiring accrual for related losses in the financial statements. |
LICENSE AGREEMENTS
LICENSE AGREEMENTS | 6 Months Ended |
Jun. 30, 2023 | |
LICENSE AGREEMENTS | |
LICENSE AGREEMENTS | NOTE 15 – LICENSE AGREEMENTS As of June 30, 2023, the Company has entered into eight license and supply agreements, whereby the Company will receive a royalty or other proceeds from the specified product revenues in select non-US markets from the licensor, if and when the underlying products are approved and commercialized. No royalty revenues have been received through June 30, 2023 under any of these agreements. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 6 Months Ended |
Jun. 30, 2023 | |
SUBSEQUENT EVENTS | |
SUBSEQUENT EVENTS | NOTE 16 - SUBSEQUENT EVENTS Effective July 18, 2023, the ratio of ADSs evidencing ordinary shares changed from 1 ADS representing five thousand (5,000) ordinary shares to 1 ADS representing sixty thousand (60,000) ordinary shares, which resulted in a 1 for 12 reverse split of the issued and outstanding ADSs. See Note 1. On August 1, 2023, the Company received a letter from Nasdaq stating that the Company’s closing bid price per ADS was at $1.00 or greater for the last 10 |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jun. 30, 2023 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Basis of Presentation: | Basis of Presentation: The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. GAAP for interim financial information. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, such statements include all adjustments (consisting only of normal recurring items) which are considered necessary for a fair presentation of the unaudited condensed consolidated financial statements of the Company as of June 30, 2023 and for the three and six months then ended. The results of operations for the three and six months ended June 30, 2023 are not necessarily indicative of the operating results for the year or any other period. These unaudited condensed consolidated financial statements should be read in conjunction with the audited financial statements and related disclosures as of December 31, 2022 and for the year then ended which are included in the Company’s Annual Report on Form 10- K, filed with the SEC on March 15, 2023. The Company operates in one segment. |
Use of estimates: | Use of estimates: The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts in the financial statements and accompanying notes. Actual results could materially differ from those estimates. Management considers many factors in developing the estimates and assumptions that are used in the preparation of these financial statements including: expected business and operational changes, sensitivity and volatility associated with the assumptions used in developing estimates, and whether historical trends are expected to be representative of future trends. The estimation process often may yield a range of potentially reasonable estimates of the ultimate future outcomes and management must select an amount that falls within that range of reasonable estimates. Estimates are used in the following areas, among others: stock-based compensation research and development expense recognition, intangible asset estimated useful lives and impairment assessments, allowances of deferred tax assets, and cash flow assumptions regarding going concern considerations. |
Cash and cash equivalents: | Cash and cash equivalents: The Company considers all highly liquid investments and short-term debt instruments with original maturities of three months or less to be cash equivalents. The Company, from time to time during the periods presented, has had bank account balances in excess of federally insured limits where substantially all cash is held in the United States. The Company has not experienced losses in such accounts. The Company believes that it is not subject to unusual credit risk beyond the normal credit risk associated with commercial banking relationships. |
Warrants: | Warrants: The Company classifies as equity any contracts that (i) require physical settlement or net-share settlement or (ii) provide the Company with a choice of net-cash settlement or settlement in its own shares (physical settlement or net-share settlement) provided that such contracts are indexed to the Company’s own stock. The Company classifies as assets or liabilities any contracts that (i) require net-cash settlement (including a requirement to net cash settle the contract if an event occurs and if that event is outside the Company’s control) or (ii) give the counterparty a choice of net-cash settlement or settlement in shares (physical settlement or net-share settlement). The Company assesses classification of its warrants and other free-standing derivatives at each reporting date to determine whether a change in classification between assets, liabilities and equity is required. The Company evaluated the warrants to assess their proper classification using the applicable criteria enumerated under U.S. GAAP and determined that such warrants meet the criteria for equity classification in the accompanying unaudited condensed consolidated balance sheets as of June 30, 2023 and December 31, 2022, respectively. |
Investments: | Investments: Investments as of June 30, 2023 and December 31, 2022 consist of U.S. Treasury Bills, which are classified as trading securities, totaling $ 10.7 million and $10.0 million, respectively. The Company determines the appropriate balance sheet classification of its investments at the time of purchase and evaluates the classification at each balance sheet date. |
Long-lived assets: | Long-lived assets: Long-lived assets are comprised of acquired technology and licensed rights to use technology, which are considered platform technology with alternative future uses beyond the current products in development. Such intangible assets are being amortized on a straight-line basis over their expected useful life of 10 years. The Company assesses the impairment for long-lived assets whenever events or circumstances indicate the carrying value may not be recoverable. Factors we consider that could trigger an impairment review include the following: ● Significant changes in the manner of the Company’s use of the acquired assets or the strategy for its overall business, ● Significant underperformance relative to expected historical or projected development milestones, ● Significant negative regulatory or economic trends, and ● Significant technological changes which could render the platform technology obsolete. The Company recognizes impairment when the sum of the expected undiscounted future cash flows is less than the carrying amount of the asset. Impairment losses, if any, are measured as the excess of the carrying amount of the asset over its estimated fair value. During the three and six months ended June 30, 2023 and 2022, there were no impairment indicators which required an impairment loss measurement. |
Research and development: | Research and development: Research and development costs are expensed as incurred. Research and development expenses include personnel costs associated with research and development activities, including third-party contractors to perform research, conduct clinical trials and manufacture drug supplies and materials. The Company accrues for costs incurred by external service providers, including contract research organizations and clinical investigators, based on its estimates of service performed and costs incurred. These estimates include the level of services performed by third parties, patient enrollment in clinical trials when applicable, administrative costs incurred by third parties, and other indicators of the services completed. Based on the timing of amounts invoiced by service providers, the Company may also record payments made to those providers as prepaid expenses that will be recognized as expenses in future periods as the related services are rendered. |
Income taxes: | Income taxes: The Company accounts for its income taxes using the asset and liability method. Accordingly, deferred tax assets and liabilities are recognized for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and tax credit carry-forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. The Company maintains a full valuation allowance on its existing deferred tax assets. The Company also accounts for uncertain tax positions using the more-likely-than-not threshold for financial statement recognition and measurement of a tax position taken in the Company’s income tax returns. As of June 30, 2023 and December 31, 2022, the Company had no uncertain tax positions which affected its financial position and its results of operations or its cash flows and will continue to evaluate for uncertain tax positions in the future. If at any time the Company should record interest and penalties in connection with income taxes, the interest and the penalties will be expensed within the interest and general and administrative expenses, respectively. |
Stock based compensation: | Stock based compensation: The Company recognizes compensation costs resulting from the issuance of stock-based awards to employees, non-employees and directors as an expense in the consolidated statements of operations over the requisite service period based on a measurement of fair value for each stock-based award. The fair value of each option grant is estimated as of the date of grant using the Black-Scholes option-pricing model, net of actual forfeitures. The fair value is amortized as compensation cost on a straight-line basis over the requisite service period of the awards, which is generally the vesting period. The Company’s expected stock volatility is based on the historical data regarding the volatility of a publicly traded set of peer companies, since it has a limited history of trading as a public company. The Company utilizes the simplified method to estimate the expected term. The risk-free interest rate was determined by reference to the U.S. Treasury yield curve in effect at the time of grant of the award for time periods approximately equal to the expected term of the award. The expected dividend yield was assumed to be zero as the Company has not paid and dividends since its inception and does not anticipate paying dividends in the foreseeable future. |
Fair value of financial instruments: | Fair value of financial instruments: The Company considers its cash and cash equivalents, investments, accounts payable, accrued expenses to meet the definition of financial instruments. The carrying amounts of these financial instruments approximated their fair values due to the short maturities. The Company measures fair value as required by ASC Topic 820, Fair Value Measurements and Disclosures |
Earnings (loss) per share: | Earnings (loss) per share: The Company reports loss per share in accordance with ASC 260-10, Earnings Per Share For the three and six months ended June 30, 2023, the number of shares excluded from the diluted net earnings (loss) per share included outstanding warrants to purchase 864,068 ADS and outstanding stock options to purchase 25,595 ADS. For the three and six months ended June 30, 2022, the number of shares excluded from the diluted net earnings (loss) per share included warrants to purchase 87,742 ADSs and outstanding options to purchase 25,760 ADSs, respectively. The inclusion of these stock options and warrants from both periods in 2023 and 2022 in the denominator would be anti-dilutive. |
FAIR VALUE OF FINANCIAL INSTR_2
FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
FAIR VALUE OF FINANCIAL INSTRUMENTS | |
Schedule of assets and liabilities measured at fair value on a recurring basis | June 30, 2023 Level 1 Level 2 Level 3 Total US Treasury Bills $ 10,680,160 $ — $ — $ 10,680,160 Total US Treasury Bills Asset $ 10,680,160 $ — $ — $ 10,680,160 December 31, 2022 Level 1 Level 2 Level 3 Total US Treasury Bills $ 9,992,900 $ — $ — $ 9,992,900 Total US Treasury Bills Asset $ 9,992,900 $ — $ — $ 9,992,900 |
STOCK BASED COMPENSATION (Table
STOCK BASED COMPENSATION (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
STOCK BASED COMPENSATION | |
Summary of stock-based activities | Weighted Weighted Average Average ADS Underlying Exercise Contractual Options Price Terms Outstanding at December 31, 2022 25,595 $ 210.00 9.28 Granted — $ — Forfeited/Cancelled — $ — Outstanding at June 30, 2023 25,595 $ 210.00 8.78 Exercisable options at June 30, 2023 6,845 $ 210.00 8.78 |
PREPAID EXPENSES (Tables)
PREPAID EXPENSES (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
PREPAID EXPENSES | |
Schedule of prepaid expenses | June 30, December 31, 2023 2022 Prepaid R&D costs $ 383,390 $ 383,390 Prepaid insurance 202,226 508,084 Prepaid expense 32,000 8,500 Total $ 617,616 $ 899,974 Less: Short-term portion (234,226) (516,584) Long-term portion $ 383,390 $ 383,390 |
ACCRUED EXPENSES (Tables)
ACCRUED EXPENSES (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
ACCRUED EXPENSES | |
Schedule of accrued expenses | June 30, December 31, 2023 2022 Research contract expenses (note 12) $ 343,152 $ 105,071 Payroll (note 11) 1,168,486 788,169 Payroll taxes (note 11) 199,408 159,593 Professional fees 85,299 44,278 Other Expenses 38,308 78,594 Total $ 1,834,653 $ 1,175,705 |
INTANGIBLE ASSETS (Tables)
INTANGIBLE ASSETS (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
INTANGIBLE ASSETS | |
Schedule of intangible assets | June 30, December 31, 2023 2022 Acquired technology – Polytherapeutics $ 40,433 $ 40,433 Technology license – Skinvisible 1,000,000 1,000,000 Total cost 1,040,433 1,040,433 Accumulated amortization (387,894) (335,872) Net book value $ 652,539 $ 704,561 |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
RELATED PARTY TRANSACTIONS | |
Schedule of amounts due to officers | June 30, December 31, 2023 2022 Salaries and other compensation $ 3,948,733 $ 4,108,500 Invoices paid on behalf of the Company — 15,232 Total $ 3,948,733 $ 4,123,732 Less: Short-term portion (725,000) (600,000) Long-term portion $ 3,223,733 $ 3,523,733 |
SHAREHOLDERS' EQUITY (Tables)
SHAREHOLDERS' EQUITY (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
SHAREHOLDERS' EQUITY | |
Schedule of warrant activities | Weighted ADSs Average Underlying Exercise Price Warrants Per ADS Outstanding at December 31, 2022 280,735 $ 24.85 * Granted Common Warrants 583,333 12.00 Granted Pre-Funded Warrants 170,833 — Exercised Pre-Funded Warrants (170,833) — Outstanding and exercisable at June 30, 2023 864,068 $ 16.17 * Includes the reduction of the exercise price from $60.00 per ADS to $13.20 per ADS for Common Warrants issued in the August Offering to investors who participated in both the Company’s August Offering and February Offering, see above. |
ORGANIZATION AND BUSINESS (Deta
ORGANIZATION AND BUSINESS (Details) | Jul. 18, 2023 shares |
ORGANIZATION AND BUSINESS | |
Shares owned (as a percent) | 12% |
Minimum | |
ORGANIZATION AND BUSINESS | |
Number of shares represented for one ADS | 5,000 |
Maximum | |
ORGANIZATION AND BUSINESS | |
Number of shares represented for one ADS | 60,000 |
LIQUIDITY RISKS AND OTHER UNC_2
LIQUIDITY RISKS AND OTHER UNCERTAINTIES (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||||||
Aug. 01, 2023 | Apr. 05, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Jun. 30, 2022 | Mar. 31, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | |
LIQUIDITY RISKS AND OTHER UNCERTAINTIES | |||||||||
Accumulated deficit | $ 42,200,000 | $ 42,200,000 | |||||||
Net loss | (2,106,947) | $ (2,603,069) | $ (2,668,167) | $ (1,682,802) | (4,710,016) | $ (4,350,969) | |||
Net cash used in operating activities | (3,319,260) | $ (4,244,926) | |||||||
Cash balance | 4,759,129 | 4,759,129 | $ 2,860,628 | ||||||
Investments | $ 10,680,160 | $ 10,680,160 | $ 9,992,900 | ||||||
ADS | |||||||||
LIQUIDITY RISKS AND OTHER UNCERTAINTIES | |||||||||
Minimum closing bid price required per ADS | $ 1 | ||||||||
Threshold number of consecutive business days for calculating closing bid price per ads | 30 days | ||||||||
ADS | Subsequent Event | |||||||||
LIQUIDITY RISKS AND OTHER UNCERTAINTIES | |||||||||
Minimum closing bid price required per ADS | $ 1 | ||||||||
Threshold number of consecutive business days for calculating closing bid price per ads | 10 days |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Additional Information (Details) $ in Millions | 6 Months Ended | |
Jun. 30, 2023 USD ($) segment | Dec. 31, 2022 USD ($) | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Number of operating segments | segment | 1 | |
U.S. Treasury Bills | $ | $ 10.7 | $ 10 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Long-lived assets & Income taxes (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||||
Intangible assets, useful life | 10 years | |||
Impairment loss measurement | $ 0 | $ 0 | $ 0 | $ 0 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Earnings (loss) per share (Details) - ADS - shares | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Employee stock option | ||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||||
Antidilutive securities | 25,595 | 25,760 | 25,595 | 25,760 |
Outstanding warrants | ||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||||
Antidilutive securities | 864,068 | 87,742 | 864,068 | 87,742 |
ACCRUED INTEREST AND FINANCIN_2
ACCRUED INTEREST AND FINANCING EXPENSE (Details) | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Jun. 30, 2023 USD ($) | Jun. 30, 2022 USD ($) | Jun. 30, 2023 USD ($) item | Jun. 30, 2022 USD ($) | Dec. 31, 2022 USD ($) item | Dec. 31, 2021 USD ($) shares | |
ACCRUED INTEREST AND FINANCING EXPENSE | ||||||
Expected accrued interest | $ 312,000 | |||||
Accrued interest and financing expense | $ 1,146,251 | $ 1,146,251 | $ 1,146,251 | |||
Total number of notes holders | item | 5 | |||||
Number of notes holders who received consideration | item | 2 | 2 | ||||
Number of remaining noteholders | item | 3 | 3 | ||||
Convertible Notes Warrants, Common Stock | ||||||
ACCRUED INTEREST AND FINANCING EXPENSE | ||||||
Accrued interest and financing expense | $ 744,000 | |||||
Convertible notes 2020 | ||||||
ACCRUED INTEREST AND FINANCING EXPENSE | ||||||
Accrued interest and financing expense | 1,146,000 | $ 1,146,000 | $ 1,146,000 | |||
Interest expense | $ 0 | $ 0 | $ 0 | $ 0 | ||
Convertible notes 2020 | Convertible Notes Warrants, Common Stock | ||||||
ACCRUED INTEREST AND FINANCING EXPENSE | ||||||
Shares issued upon conversion | shares | 432 |
FAIR VALUE OF FINANCIAL INSTR_3
FAIR VALUE OF FINANCIAL INSTRUMENTS - Fair value on a recurring basis (Details) - Recurring - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
FAIR VALUE OF FINANCIAL INSTRUMENTS | ||
Warrant liability | $ 10,680,160 | $ 9,992,900 |
US Treasury Bills | ||
FAIR VALUE OF FINANCIAL INSTRUMENTS | ||
Warrant liability | 10,680,160 | 9,992,900 |
Level 1 | ||
FAIR VALUE OF FINANCIAL INSTRUMENTS | ||
Warrant liability | 10,680,160 | 9,992,900 |
Level 1 | US Treasury Bills | ||
FAIR VALUE OF FINANCIAL INSTRUMENTS | ||
Warrant liability | $ 10,680,160 | $ 9,992,900 |
STOCK BASED COMPENSATION (Detai
STOCK BASED COMPENSATION (Details) - Amended plan | 6 Months Ended |
Jun. 30, 2023 shares | |
STOCK BASED COMPENSATION | |
Percentage of ordinary shares reserved for issuance | 15% |
Number of ordinary shares reserved for future issuance | 16,891,925,220 |
ADS | |
STOCK BASED COMPENSATION | |
Number of ordinary shares reserved for future issuance | 281,532 |
Granted | 255,937 |
STOCK BASED COMPENSATION - Opti
STOCK BASED COMPENSATION - Option activity (Details) - $ / shares | 6 Months Ended | 12 Months Ended |
Jun. 30, 2023 | Dec. 31, 2022 | |
Weighted Average Exercise Price | ||
Outstanding at December 31, 2022 | $ 24.85 | |
Outstanding and exercisable at June 30, 2023 | $ 16.17 | $ 24.85 |
ADS | ||
ADS Underlying Options | ||
Outstanding at December 31, 2022 | 280,735 | |
Outstanding and exercisable at June 30, 2023 | 864,068 | 280,735 |
Amended plan | ADS | ||
ADS Underlying Options | ||
Outstanding at December 31, 2022 | 25,595 | |
Granted | 255,937 | |
Outstanding and exercisable at June 30, 2023 | 25,595 | 25,595 |
Exercisable options (in shares) | 6,845 | |
Weighted Average Exercise Price | ||
Outstanding at December 31, 2022 | $ 210 | |
Outstanding and exercisable at June 30, 2023 | 210 | $ 210 |
Exercisable options (in dollars per share) | $ 210 | |
Weighted Average Contractual Terms | ||
Contractual term (in years) | 8 years 9 months 10 days | 9 years 3 months 10 days |
Exercisable options (in years) | 8 years 9 months 10 days |
STOCK BASED COMPENSATION - Stoc
STOCK BASED COMPENSATION - Stock based compensation expense (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2023 | Jun. 30, 2022 | |
STOCK BASED COMPENSATION | |||
Intrinsic value of outstanding options | $ 0 | $ 0 | |
Stock-based compensation expense | 264,000 | 526,000 | $ 229,000 |
Unrecognized stock compensation expense | 2,679,000 | $ 2,679,000 | |
Unrecognized stock compensation expense expected to be recognized over the remaining weighted average service period | 2 years 7 months 6 days | ||
Research and Development Expense | |||
STOCK BASED COMPENSATION | |||
Stock-based compensation expense | 34,000 | $ 69,000 | 30,000 |
General and Administrative Expense | |||
STOCK BASED COMPENSATION | |||
Stock-based compensation expense | $ 230,000 | $ 457,000 | $ 199,000 |
PREPAID EXPENSES (Details)
PREPAID EXPENSES (Details) - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
PREPAID EXPENSES | ||
Prepaid R&D costs | $ 383,390 | $ 383,390 |
Prepaid insurance | 202,226 | 508,084 |
Prepaid expense | 32,000 | 8,500 |
Total | 617,616 | 899,974 |
Less: Short-term portion | (234,226) | (516,584) |
Long-term portion | $ 383,390 | $ 383,390 |
ACCRUED EXPENSES (Details)
ACCRUED EXPENSES (Details) - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
ACCRUED EXPENSES | ||
Research contract expenses | $ 343,152 | $ 105,071 |
Payroll | 1,168,486 | 788,169 |
Payroll taxes | 199,408 | 159,593 |
Professional fees | 85,299 | 44,278 |
Other Expenses | 38,308 | 78,594 |
Total | $ 1,834,653 | $ 1,175,705 |
IN-LICENSED TECHNOLOGY - Polyth
IN-LICENSED TECHNOLOGY - Polytherapeutics (Details) - Polytherapeutics | Mar. 24, 2018 USD ($) |
IN-LICENSED TECHNOLOGY | |
Purchase price agreement | $ 40,833 |
Royalty payment period | 10 years |
Percentage of royalty payments of net revenue | 4% |
Royalty payments with generic product introduced, as a percent of net revenue | 2% |
Royalty payments with two or more generic product introduced, as a percent of net revenue | 0% |
IN-LICENSED TECHNOLOGY - Skinvi
IN-LICENSED TECHNOLOGY - Skinvisible (Details) - Skinvisible Licensing agreement $ in Millions | 1 Months Ended |
Oct. 31, 2019 USD ($) | |
IN-LICENSED TECHNOLOGY | |
License Fee | $ 1 |
Percentage of revenues to be paid | 25% |
Amount of payment to be made | $ 5 |
INTANGIBLE ASSETS (Details)
INTANGIBLE ASSETS (Details) - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
INTANGIBLE ASSETS | ||
Total cost | $ 1,040,433 | $ 1,040,433 |
Accumulated amortization | (387,894) | (335,872) |
Net book value | 652,539 | 704,561 |
Acquired technology - Polytherapeutics | ||
INTANGIBLE ASSETS | ||
Total cost | 40,433 | 40,433 |
Technology license - Skinvisible | ||
INTANGIBLE ASSETS | ||
Total cost | $ 1,000,000 | $ 1,000,000 |
INTANGIBLE ASSETS - Additional
INTANGIBLE ASSETS - Additional Information (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
INTANGIBLE ASSETS | ||||
Amortization of intangibles | $ 26,000 | $ 26,000 | $ 52,022 | $ 52,021 |
Expected amortization expense | ||||
2023 | 52,000 | 52,000 | ||
2024 | 104,000 | 104,000 | ||
2025 | 104,000 | 104,000 | ||
2026 | 104,000 | 104,000 | ||
Thereafter | $ 288,000 | $ 288,000 |
RELATED PARTY TRANSACTIONS - Na
RELATED PARTY TRANSACTIONS - Narrative (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | |
RELATED PARTY TRANSACTIONS | |||||
Non-bearing interest indebtedness | $ 175,000 | $ 300,000 | |||
Outstanding indebtedness | $ 725,000 | $ 725,000 | $ 600,000 | ||
Other Liability, Related Party, Type [Extensible Enumeration] | srt:OfficerMember | srt:OfficerMember | srt:OfficerMember | ||
Operating Costs and Expenses | $ 2,260,064 | $ 2,668,167 | $ 5,035,614 | $ 4,844,206 | |
Operating Cost and Expense, Related Party, Type [Extensible Enumeration] | us-gaap:RelatedPartyMember | us-gaap:RelatedPartyMember | |||
Consulting expense | |||||
RELATED PARTY TRANSACTIONS | |||||
Operating Costs and Expenses | 0 | 12,000 | $ 12,000 | $ 24,000 | |
Dr. Myers | |||||
RELATED PARTY TRANSACTIONS | |||||
Monthly payment amounts due to related party | 25,000 | ||||
Non-bearing interest indebtedness | 75,000 | 75,000 | 150,000 | 150,000 | |
Outstanding indebtedness | $ 2,109,000 | $ 2,109,000 | |||
Other Liability, Related Party, Type [Extensible Enumeration] | us-gaap:RelatedPartyMember | us-gaap:RelatedPartyMember | |||
Ms. Carter | |||||
RELATED PARTY TRANSACTIONS | |||||
Monthly payment amounts due to related party | $ 25,000 | ||||
Non-bearing interest indebtedness | $ 0 | $ 75,000 | 25,000 | $ 150,000 | |
Outstanding indebtedness | $ 1,840,000 | $ 1,840,000 | |||
Other Liability, Related Party, Type [Extensible Enumeration] | us-gaap:RelatedPartyMember | us-gaap:RelatedPartyMember |
RELATED PARTY TRANSACTIONS - Am
RELATED PARTY TRANSACTIONS - Amounts due to officers (Details) - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
RELATED PARTY TRANSACTIONS | ||
Total | $ 3,948,733 | $ 4,123,732 |
Other Liability, Related Party, Type [Extensible Enumeration] | srt:OfficerMember | srt:OfficerMember |
Less: Short-term portion | $ (725,000) | $ (600,000) |
Other Liability, Current, Related Party, Type [Extensible Enumeration] | srt:OfficerMember | srt:OfficerMember |
Long-term portion | $ 3,223,733 | $ 3,523,733 |
Other Liability, Noncurrent, Related Party, Type [Extensible Enumeration] | srt:OfficerMember | srt:OfficerMember |
Salaries and other compensation | ||
RELATED PARTY TRANSACTIONS | ||
Total | $ 3,948,733 | $ 4,108,500 |
Other Liability, Related Party, Type [Extensible Enumeration] | srt:OfficerMember | srt:OfficerMember |
Invoices paid on behalf of the Company | ||
RELATED PARTY TRANSACTIONS | ||
Total | $ 15,232 | |
Other Liability, Related Party, Type [Extensible Enumeration] | srt:OfficerMember | srt:OfficerMember |
RESEARCH, CONSULTING AGREEMEN_2
RESEARCH, CONSULTING AGREEMENTS AND COMMITMENTS (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||||||
Mar. 31, 2022 | Nov. 30, 2020 | Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | May 31, 2022 | Dec. 31, 2021 | Nov. 30, 2021 | |
RESEARCH, CONSULTING AGREEMENTS AND COMMITMENTS | ||||||||||
Research and development | $ 625,104 | $ 726,694 | $ 1,716,837 | $ 1,314,263 | ||||||
Accrued expenses | 1,834,653 | 1,834,653 | $ 1,175,705 | |||||||
Other income | 153,117 | 325,598 | 493,237 | |||||||
Gain on reduction in liability | 416,000 | |||||||||
Research and consulting agreement | Netherton Syndrome | ||||||||||
RESEARCH, CONSULTING AGREEMENTS AND COMMITMENTS | ||||||||||
Research and development | 0 | 77,000 | 50,000 | 77,000 | ||||||
Research and consulting agreement | Therapeutics Inc. | ||||||||||
RESEARCH, CONSULTING AGREEMENTS AND COMMITMENTS | ||||||||||
Research and development | 360,000 | 309,000 | 959,000 | 480,000 | ||||||
Research and consulting agreement | Scleroderma | ||||||||||
RESEARCH, CONSULTING AGREEMENTS AND COMMITMENTS | ||||||||||
Total amount of agreement | $ 610,000 | |||||||||
Research and development | 138,000 | 0 | 226,000 | 0 | ||||||
Consulting agreements | Investor Relations firm | ||||||||||
RESEARCH, CONSULTING AGREEMENTS AND COMMITMENTS | ||||||||||
Monthly payments | 14,000 | 14,000 | ||||||||
Accrued expenses | $ 584,000 | |||||||||
Other income | $ 416,000 | |||||||||
Gain on reduction in liability | $ 168,000 | |||||||||
Consulting fees | $ 0 | 0 | $ 0 | 0 | ||||||
Consulting agreements | Netherton Syndrome | ||||||||||
RESEARCH, CONSULTING AGREEMENTS AND COMMITMENTS | ||||||||||
Total amount of agreement | $ 250,000 | |||||||||
Consulting agreements | Therapeutics Inc. | ||||||||||
RESEARCH, CONSULTING AGREEMENTS AND COMMITMENTS | ||||||||||
Initial term | 3 years | |||||||||
Written termination notice period | 90 days | |||||||||
Total amount of agreement | $ 4,400,000 | $ 4,400,000 | $ 830,000 |
SHAREHOLDERS' EQUITY - Share Ca
SHAREHOLDERS' EQUITY - Share Capital (Details) | 3 Months Ended | 6 Months Ended | |||||
Feb. 24, 2023 USD ($) $ / shares shares | Mar. 31, 2023 shares | Jun. 30, 2023 Vote Y $ / shares shares | Dec. 31, 2022 $ / shares shares | Nov. 03, 2022 $ / shares shares | Nov. 02, 2022 shares | Apr. 12, 2022 $ / shares shares | |
SHAREHOLDERS' EQUITY | |||||||
Ordinary shares, shares authorized | 500,000,000,000 | 500,000,000,000 | 500,000,000,000 | 50,000,000,000 | 50,000,000,000 | ||
Ordinary shares, par value | $ / shares | $ 0 | $ 0 | $ 0 | $ 0 | |||
Number of vote for each ordinary share | Vote | 1 | ||||||
Number of years of income that limits distribution | Y | 2 | ||||||
Maximum period between date of financial statements and distribution date | 6 months | ||||||
Threshold period for not to issue or proposed issuance of any ADSs or ordinary shares | 90 days | ||||||
Threshold period for not to enter in to an agreement for variable rate transaction from the date of closing of the Offering | 180 days | ||||||
Warrant Amendments | |||||||
SHAREHOLDERS' EQUITY | |||||||
Incremental fair value | $ | $ 238,000 | ||||||
Public offering | |||||||
SHAREHOLDERS' EQUITY | |||||||
Issuance of ADS and Pre-Funded Warrants, net (in shares) | 24,750,000,000 | ||||||
Public offering | Pre-Funded Warrants | |||||||
SHAREHOLDERS' EQUITY | |||||||
Warrants, number of securities called by warrants (in shares) | 10,250,000,000 | ||||||
ADS | |||||||
SHAREHOLDERS' EQUITY | |||||||
Issuance of ADS and Pre-Funded Warrants, net (in shares) | 583,333 | ||||||
Warrants, exercise price of warrants (in dollars per share) | $ / shares | $ 60 | ||||||
Shares warrants may purchase | 280,000 | ||||||
ADS | Warrant Amendments | |||||||
SHAREHOLDERS' EQUITY | |||||||
Warrants, exercise price of warrants (in dollars per share) | $ / shares | $ 13.20 | ||||||
Shares warrants may purchase | 235,833 | ||||||
ADS | Public offering | |||||||
SHAREHOLDERS' EQUITY | |||||||
Issuance of ADS and Pre-Funded Warrants, net (in shares) | 412,500 | ||||||
Purchase price | $ / shares | $ 12 | ||||||
ADS | Public offering | Pre-Funded Warrants | |||||||
SHAREHOLDERS' EQUITY | |||||||
Purchase price | $ / shares | $ 11.9988 | ||||||
Warrants, number of securities called by warrants (in shares) | 170,833 | ||||||
Gross proceeds from offering | $ | $ 7,000,000 | ||||||
Net proceeds from offering | $ | $ 5,800,000 | ||||||
ADS | Public offering | Common Warrants | |||||||
SHAREHOLDERS' EQUITY | |||||||
Warrants, exercise price of warrants (in dollars per share) | $ / shares | $ 12 |
SHAREHOLDERS' EQUITY - Warrants
SHAREHOLDERS' EQUITY - Warrants (Details) | 6 Months Ended |
Jun. 30, 2023 $ / shares shares | |
Weighted Average Exercise Price Per Share | |
Outstanding at December 31, 2022 | $ / shares | $ 24.85 |
Outstanding and exercisable at June 30, 2023 | $ / shares | 16.17 |
Common Warrants | |
Weighted Average Exercise Price Per Share | |
Granted | $ / shares | $ 12 |
ADS | |
ADSs Underlying Warrants | |
Outstanding at December 31, 2022 | 280,735 |
Outstanding and exercisable at June 30, 2023 | 864,068 |
ADS | Common Warrants | |
ADSs Underlying Warrants | |
Granted | 583,333 |
ADS | Pre-Funded Warrants | |
ADSs Underlying Warrants | |
Granted | 170,833 |
Exercised Pre-Funded Warrants | (170,833) |
LICENSE AGREEMENTS (Details)
LICENSE AGREEMENTS (Details) | 6 Months Ended |
Jun. 30, 2023 USD ($) agreement | |
LICENSE AGREEMENTS | |
Number of license and supply agreements entered | agreement | 8 |
Royalty revenues | $ | $ 0 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - ADS | Aug. 01, 2023 $ / shares | Jul. 18, 2023 shares | Apr. 05, 2023 $ / shares |
SUBSEQUENT EVENTS | |||
Threshold number of consecutive business days for calculating closing bid price per ads | 30 days | ||
Minimum closing bid price required per ADS | $ / shares | $ 1 | ||
Subsequent Event | |||
SUBSEQUENT EVENTS | |||
Number of ordinary shares for each ADS | shares | 5,000 | ||
Number of ordinary shares for ADS | shares | 60,000 | ||
Reverse stock split | 12 | ||
Threshold number of consecutive business days for calculating closing bid price per ads | 10 days | ||
Minimum closing bid price required per ADS | $ / shares | $ 1 |