Cover
Cover - shares | 9 Months Ended | |
Sep. 30, 2020 | Nov. 02, 2020 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Sep. 30, 2020 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2020 | |
Current Fiscal Year End Date | --12-31 | |
Entity File Number | 001-38552 | |
Entity Registrant Name | PROVENTION BIO, INC. | |
Entity Central Index Key | 0001695357 | |
Entity Tax Identification Number | 81-5245912 | |
Entity Incorporation, State or Country Code | DE | |
Entity Address, Address Line One | 55 Broad Street | |
Entity Address, Address Line Two | 2nd Floor | |
Entity Address, City or Town | Red Bank | |
Entity Address, State or Province | NJ | |
Entity Address, Postal Zip Code | 07701 | |
City Area Code | (908) | |
Local Phone Number | 336-0360 | |
Title of 12(b) Security | Common Stock, $0.0001 par value per share | |
Trading Symbol | PRVB | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Elected Not To Use the Extended Transition Period | true | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 56,487,891 |
Condensed Balance Sheets (Unaud
Condensed Balance Sheets (Unaudited) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 118,439 | $ 39,165 |
Marketable securities | 28,719 | 46,208 |
Prepaid expenses and other current assets | 4,173 | 623 |
Total current assets | 151,331 | 85,996 |
Fixed assets, net | 352 | |
Other assets | 120 | |
Total assets | 151,803 | 85,996 |
Current liabilities: | ||
Accounts payable | 7,105 | 1,775 |
Accrued expenses | 9,299 | 2,065 |
Total current liabilities | 16,404 | 3,840 |
Commitments and Contingencies (Note 6) | ||
Stockholders’ equity: | ||
Preferred stock, $0.0001 par value; 25,000,000 shares authorized; no shares issued or outstanding at September 30, 2020 and December 31, 2019 | ||
Common stock, $0.0001 par value; 100,000,000 shares authorized; 56,487,891 shares issued and outstanding at September 30, 2020; 47,658,361 shares issued and outstanding at December 31, 2019 | 6 | 5 |
Additional paid-in capital | 280,439 | 161,212 |
Accumulated other comprehensive income | 20 | |
Accumulated deficit | (145,066) | (79,061) |
Total stockholders’ equity | 135,399 | 82,156 |
Total liabilities and stockholders’ equity | $ 151,803 | $ 85,996 |
Condensed Balance Sheets (Una_2
Condensed Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Sep. 30, 2020 | Dec. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Preferred Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 |
Preferred Stock, Shares Authorized | 25,000,000 | 25,000,000 |
Preferred Stock, Shares Outstanding | 0 | 0 |
Preferred Stock, Shares Issued | 0 | 0 |
Common Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 |
Common Stock, Shares Authorized | 100,000,000 | 100,000,000 |
Common Stock, Shares, Issued | 56,487,891 | 47,658,361 |
Common Stock, Shares, Outstanding | 56,487,891 | 47,658,361 |
Condensed Statements of Compreh
Condensed Statements of Comprehensive Loss (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Operating expenses: | ||||
Research and development | $ 21,657 | $ 7,324 | $ 45,779 | $ 27,896 |
General and administrative | 9,749 | 2,649 | 21,288 | 5,593 |
Total operating expenses | 31,406 | 9,973 | 67,067 | 33,489 |
Loss from operations | (31,406) | (9,973) | (67,067) | (33,489) |
Interest income | 105 | 204 | 539 | 744 |
Loss before income tax benefit | (31,301) | (9,769) | (66,528) | (32,745) |
Income tax benefit | 523 | |||
Net loss | $ (31,301) | $ (9,769) | $ (66,005) | $ (32,745) |
Net loss per common share, basic and diluted | $ (0.56) | $ (0.24) | $ (1.29) | $ (0.85) |
Weighted average common shares outstanding, basic and diluted | 56,339 | 40,512 | 51,098 | 38,424 |
Net loss | $ (31,301) | $ (9,769) | $ (66,005) | $ (32,745) |
Other comprehensive income (loss): | ||||
Unrealized gain (loss) on marketable securities | (78) | 20 | ||
Total comprehensive loss | $ (31,379) | $ (9,769) | $ (65,985) | $ (32,745) |
Condensed Statement of Stockhol
Condensed Statement of Stockholders' Equity (Deficit) (Unaudited) - USD ($) $ in Thousands | Common Stock [Member] | Additional Paid-in Capital [Member] | AOCI Attributable to Parent [Member] | Retained Earnings [Member] | Total |
Beginning balance, value at Dec. 31, 2018 | $ 4 | $ 95,430 | $ (35,776) | $ 59,658 | |
Balance, shares at Dec. 31, 2018 | 37,362 | ||||
Stock-based compensation | 1,628 | 1,628 | |||
Issuance of common stock in connection with stock option exercises | 219 | 219 | |||
Issuance of common stock in connection with stock option exercises, shares | 59 | ||||
Issuance of common stock in connection with warrant exercises | |||||
Issuance of common stock in connection with warrant exercises, shares | 1,967 | ||||
Unrealized gain (loss) on marketable securities, net of tax | |||||
Issuance of common stock in connection with underwritten public offering, net of issuance costs | $ 1 | 42,650 | 42,651 | ||
Issuance of common stock in connection with underwritten public offering, net of issuance costs, shares | 5,750 | ||||
Issuance of common stock in connection with private placement with Amgen | 20,000 | 20,000 | |||
Issuance of common stock in connection with private placement with Amgen, shares | 2,500 | ||||
Net loss | (32,745) | (32,745) | |||
Ending balance, value at Sep. 30, 2019 | $ 5 | 159,927 | (68,521) | 91,411 | |
Shares, Outstanding, Ending Balance at Sep. 30, 2019 | 47,638 | ||||
Beginning balance, value at Jun. 30, 2019 | $ 4 | 96,156 | (58,752) | 37,408 | |
Balance, shares at Jun. 30, 2019 | 37,370 | ||||
Stock-based compensation | 923 | 923 | |||
Issuance of common stock in connection with stock option exercises | 198 | 198 | |||
Issuance of common stock in connection with stock option exercises, shares | 51 | ||||
Issuance of common stock in connection with warrant exercises | |||||
Issuance of common stock in connection with warrant exercises, shares | 1,967 | ||||
Unrealized gain (loss) on marketable securities, net of tax | |||||
Issuance of common stock in connection with underwritten public offering, net of issuance costs | $ 1 | 42,650 | 42,651 | ||
Issuance of common stock in connection with underwritten public offering, net of issuance costs, shares | 5,750 | ||||
Issuance of common stock in connection with private placement with Amgen | 20,000 | 20,000 | |||
Issuance of common stock in connection with private placement with Amgen, shares | 2,500 | ||||
Net loss | (9,769) | (9,769) | |||
Ending balance, value at Sep. 30, 2019 | $ 5 | 159,927 | (68,521) | 91,411 | |
Shares, Outstanding, Ending Balance at Sep. 30, 2019 | 47,638 | ||||
Beginning balance, value at Dec. 31, 2019 | $ 5 | 161,212 | (79,061) | 82,156 | |
Balance, shares at Dec. 31, 2019 | 47,658 | ||||
Stock-based compensation | 5,228 | 5,228 | |||
Issuance of common stock in connection with stock option exercises | 861 | 861 | |||
Issuance of common stock in connection with stock option exercises, shares | 189 | ||||
Issuance of common stock in connection with warrant exercises | |||||
Issuance of common stock in connection with warrant exercises, shares | 326 | ||||
Unrealized gain (loss) on marketable securities, net of tax | 20 | 20 | |||
Issuance of common stock in connection with underwritten public offering, net of issuance costs | $ 1 | 103,269 | 103,270 | ||
Issuance of common stock in connection with underwritten public offering, net of issuance costs, shares | 7,590 | ||||
Issuance of common stock in connection with at-the-market stock sales, net of issuance costs | 9,869 | 9,869 | |||
Issuance of common stock in connection with at-the-market stock sales, net of issuance costs, shares | 725 | ||||
Net loss | (66,005) | (66,005) | |||
Ending balance, value at Sep. 30, 2020 | $ 6 | 280,439 | 20 | (145,066) | 135,399 |
Shares, Outstanding, Ending Balance at Sep. 30, 2020 | 56,488 | ||||
Beginning balance, value at Jun. 30, 2020 | $ 6 | 277,437 | 98 | (113,765) | 163,776 |
Balance, shares at Jun. 30, 2020 | 56,216 | ||||
Stock-based compensation | 2,715 | 2,715 | |||
Issuance of common stock in connection with stock option exercises | 287 | 287 | |||
Issuance of common stock in connection with stock option exercises, shares | 76 | ||||
Issuance of common stock in connection with warrant exercises | |||||
Issuance of common stock in connection with warrant exercises, shares | 196 | ||||
Unrealized gain (loss) on marketable securities, net of tax | (78) | $ (78) | |||
Issuance of common stock in connection with underwritten public offering, net of issuance costs, shares | |||||
Issuance of common stock in connection with private placement with Amgen, shares | |||||
Issuance of common stock in connection with at-the-market stock sales, net of issuance costs, shares | |||||
Net loss | (31,301) | $ (31,301) | |||
Ending balance, value at Sep. 30, 2020 | $ 6 | $ 280,439 | $ 20 | $ (145,066) | $ 135,399 |
Shares, Outstanding, Ending Balance at Sep. 30, 2020 | 56,488 |
Condensed Statements of Cash Fl
Condensed Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Operating activities | ||
Net loss | $ (66,005) | $ (32,745) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Stock-based compensation expense | 5,228 | 1,628 |
Amortization of premium and discounts on marketable securities | 109 | |
Changes in operating assets and liabilities: | ||
Prepaid expenses and other current assets | (3,550) | 1,707 |
Accounts payable | 5,330 | 1,697 |
Accrued interest receivable | 72 | |
Accrued expenses | 7,234 | 1,392 |
Other assets | (120) | |
Net cash used in operating activities | (51,702) | (26,321) |
Investing activities | ||
Purchase of marketable securities | (24,672) | |
Maturities of marketable securities | 42,000 | |
Purchase of fixed assets | (352) | |
Net cash provided by investing activities | 16,976 | |
Financing activities | ||
Proceeds from underwritten public offering, net | 103,270 | 42,651 |
Proceeds from private placement with Amgen | 20,000 | |
Proceeds from at-the-market stock sales, net | 9,869 | |
Proceeds from stock option exercises | 861 | 219 |
Net cash provided by financing activities | 114,000 | 62,870 |
Net increase in cash and cash equivalents | 79,274 | 36,549 |
Cash and cash equivalents at beginning of period | 39,165 | 58,539 |
Cash and cash equivalents at end of period | $ 118,439 | $ 95,088 |
DESCRIPTION OF BUSINESS AND BAS
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | 9 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | 1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION Business Provention Bio, Inc. (the “Company” or “Provention”) was incorporated on October 4, 2016 under the laws of the State of Delaware. The Company is a clinical stage biopharmaceutical company, focused on the development and commercialization of novel therapeutics and innovative approaches to intercept and prevent immune-mediated diseases. Since its inception, the Company has devoted substantially all of its efforts to business planning, research and development, recruiting management and technical staff, acquiring operating assets and raising capital. The Company’s business is subject to significant risks and uncertainties and will be dependent on raising substantial additional capital before it becomes profitable and it may never achieve profitability. Basis of Presentation The accompanying unaudited financial information as of September 30, 2020 and for the three and nine months ended September 30, 2020 and 2019 has been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) have been condensed or omitted pursuant to such rules and regulations. The December 31, 2019 Condensed Balance Sheet was derived from the Company’s audited financial statements. These interim financial statements should be read in conjunction with the notes to the financial statements contained in the Company’s Annual Report on Form 10-K (“Annual Report”) for 2019, as filed with the SEC on March 12, 2020, as amended by Amendment No. 1 on Form 10-K/A, and filed with the SEC on April 8, 2020 and as further amended by Amendment No. 2 on Form 10-K/A, and filed with the SEC on August 6, 2020. In the opinion of management, the unaudited financial information as of September 30, 2020 and for the three and nine months ended September 30, 2020 and 2019, reflects all adjustments, which are normal recurring adjustments, necessary to present a fair statement of the financial position, results of operations and cash flows of the Company. The results of operations for the three and nine months ended September 30, 2020 and 2019 are not necessarily indicative of the operating results for the full fiscal year or any future period. |
LIQUIDITY
LIQUIDITY | 9 Months Ended |
Sep. 30, 2020 | |
Liquidity | |
LIQUIDITY | 2. LIQUIDITY The accompanying financial statements have been prepared assuming the Company will continue as a going concern, which contemplates continuity of operations, realization of assets and the satisfaction of liabilities and commitments in the normal course of business. The Company has incurred recurring losses since inception and as of September 30, 2020, the Company had an accumulated deficit of $ 145.1 million . In April 2017, the Company completed its private placement of 11,381,999 2.50 26.7 In July 2018, the Company issued and sold an aggregate of 15,969,563 shares of common stock in its initial public offering (“IPO”) at a public offering price of $ 4.00 per share. In connection with the IPO, the Company issued to MDB Capital Group, LLC (“MDB”), the underwriter in the IPO, and its designees warrants to purchase 1,596,956 shares of common stock at an exercise price of $ 5.00 per share. The Company received net proceeds from the IPO of $ 59.3 million, after deducting underwriting discounts and commissions of approximately $ 3.7 million and other offering expenses of approximately $ 0.8 million. Upon the closing of the IPO, all of the Company’s shares of redeemable convertible preferred stock outstanding at the time of the offering were automatically converted into 11,381,999 shares of common stock. In addition, the warrants issued in connection with the Series A Convertible Redeemable Preferred Stock also converted to warrants for the purchase of 558,740 shares of the Company’s common stock. In September 2019, the Company completed an underwritten public offering in which it sold 5,750,000 8.00 750,000 8.00 2,500,000 8.00 62.7 2.8 0.5 In August 2019, the Company established an at-the-market (“ATM”) program through which the Company may sell, from time to time at its sole discretion, up to $ 50 725,495 9.9 0.3 In June 2020, the Company completed an underwritten public offering in which it sold 7,590,000 14.50 990,000 14.50 103.3 6.6 0.2 The Company has devoted substantially all of its financial resources and efforts to research and development and expects to continue to incur significant expenses and increasing operating losses over the next several years due to, among other things, costs related to research funding, development of its product candidates and its preclinical programs, strategic alliances, the development of its administrative and commercial organization and pre-commercial activities for PRV-031 . The Company will require substantial additional financing to fund its operations and to continue to execute its strategy. The Company may raise capital through public or private equity or debt financings. The sale of equity or other securities may result in dilution to the Company’s stockholders and certain of those securities may have rights senior to those of the Company’s existing shares. If the Company raises additional funds through the issuance of preferred stock, convertible debt securities or other debt financing, these securities or other debt could contain covenants that would restrict the Company’s operations. Any other third-party funding arrangement could require the Company to relinquish valuable rights. The source, timing and availability of any future financing will depend principally upon market conditions, and, more specifically, on the progress of the Company’s clinical development programs. Funding may not be available when needed, at all, or on terms acceptable to the Company. Lack of necessary funds may require the Company, among other things, to delay, scale back or eliminate some or all of the Company’s planned operations. The Company’s cash requirements for the rest of 2020 and into 2021 will be impacted by a number of factors, the most significant of which are expenses related to PRV-031, including costs related to the Company’s BLA submission in the At-Risk indication, costs to build out the Company’s commercial infrastructure and pre-commercial activities for PRV-031, the PROTECT clinical trial, manufacturing activities for PRV-031 and any potential milestone payments that may become due upon a potential regulatory approval of PRV-031 by the FDA. Other factors include costs related to the Company’s recently initiated Phase 2b clinical study of PRV-015 and the Company’s continued development efforts for PRV-101. Depending on the timing and outcome of the Company’s regulatory activities and the status of its plans to prepare for a potential regulatory approval of PRV-031 by the FDA in 2021, the Company may encounter near-term liquidity needs that could impact its cash runway over the next 12 months. If the Company does not obtain additional financing, or prudently manage its expenses, the Company’s financial condition, cash flows and results of operations could be materially and adversely affected. Based on the Company’s current business plans, management believes that its cash, cash equivalents and marketable securities on hand at September 30, 2020 are sufficient to meet the Company’s obligations for at least the next 12 months from the issuance of these financial statements. |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
SIGNIFICANT ACCOUNTING POLICIES | 3. SIGNIFICANT ACCOUNTING POLICIES A summary of the significant accounting policies followed by the Company in the preparation of the financial statements is as follows: Use of estimates The process of preparing financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of assets and liabilities at the date of financial statements and the reported amounts of expenses during the reporting period. Actual results could differ from those estimates and changes in estimates may occur. Segment and geographic information 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. The Company views its operations and manages its business in one Cash, cash equivalents and concentration of credit risk The Company considers only those investments which are highly liquid, readily convertible to cash, or that mature within 90 days from the date of purchase to be cash equivalents. Marketable securities are those investments with original maturities in excess of 90 days. The carrying amounts reported in the balance sheets for cash and cash equivalents are valued at cost, which approximates their fair value. The Company has no off-balance-sheet concentration of credit risk such as foreign exchange contracts, option contracts or other hedging arrangements. The Company holds cash and cash equivalents in banks in excess of FDIC insurance limits. However, the Company believes risk of loss is minimal as the cash and cash equivalents are held by large, highly-rated financial institutions. Marketable securities The Company considers securities with original maturities of greater than 90 days to be available for sale securities. Available for sale securities are classified as either current or non-current assets based on the nature of the securities and their availability for use in current operations. Available for sale securities are recorded at fair value and unrealized gains and losses are recorded within accumulated other comprehensive income. The estimated fair value of the available for sale securities is determined based on quoted market prices or rates for similar instruments. In addition, the cost of debt securities in this category is adjusted for amortization of premium and accretion of discount to maturity. On a quarterly basis, the Company reviews the status of each security in an unrealized loss position, to evaluate the existence of potential credit losses. The Company first considers whether it intends to sell, or if it is more likely than not that the Company will be required to sell the security before recovery of its amortized cost basis. If either of the criteria regarding intent or requirement to sell is met, the security’s amortized cost basis is written down to fair value through income. For securities that do not meet this criteria, the Company considers a number of factors to determine if the decline in fair value has resulted from credit losses or other factors, including but not limited to: (1) the extent of the decline; (2) changes to the rating of the security by a rating agency; (3) any adverse conditions specific to the security; and (4) other market conditions that may affect the fair value of the security. If this assessment indicates that a credit loss exists and the present value of cash flows expected to be collected is less than the amortized cost basis, an allowance for credit losses is required for the credit loss. Any impairment that has not been recorded through an allowance for credit losses is recognized in other comprehensive income. As of September 30, 2020, the Company has not recognized any impairment or credit losses on its available for sale securities. Financial instruments Cash, cash equivalents and marketable securities are reflected in the accompanying financial statements at fair value. The carrying amount of accounts payable and accrued expenses, including accrued research and development expenses, approximates fair value due to the short-term nature of those instruments. Fixed assets, net Fixed assets, which consists primarily of leasehold improvements, furniture and fixtures, office equipment and certain clinical equipment, are carried at cost less accumulated depreciation. Depreciation is computed over the estimated useful lives of the respective assets, generally three seven Foreign currency translation The Company considers the U.S. dollar to be its functional currency. Expenses denominated in foreign currencies are translated at the exchange rate on the date the expense is incurred. The effect of exchange rate fluctuations on translating foreign currency assets and liabilities into U.S. dollars is included in the Statements of Comprehensive Loss. Foreign exchange transaction gains and losses are included in the results of operations and are not material in the Company’s financial statements. Research and development expenses Research and development expenses primarily consist of costs associated with the preclinical and clinical development of the Company’s product candidate portfolio, including the following: ● external research and development expenses incurred under arrangements with third parties, such as contract research organizations (“CROs”) and other vendors and contract manufacturing organizations (“CMOs”) for the production of drug substance and drug product; and ● employee-related expenses, including salaries, benefits and share-based compensation expense. Research and development expenses also include costs of acquired product licenses and related technology rights where there is no alternative future use, costs of prototypes used in research and development, consultant fees and amounts paid to certain of our collaborative partners. All research and development expenses are charged to operations as incurred in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic (“ASC”) 730, Research and Development Accrued research and development expenses As part of the process of preparing our financial statements, the Company is required to estimate its accrued expenses. This process involves reviewing quotations and contracts, identifying services that have been performed on the Company’s behalf and estimating the level of service performed and the associated cost incurred for the service when the Company has not yet been invoiced or otherwise notified of the actual cost. The majority of the Company’s service providers invoice the Company monthly in arrears for services performed or when contractual milestones are met. The Company makes estimates of its accrued expenses as of each balance sheet date in our financial statements based on facts and circumstances known to the Company at that time. The Company periodically confirms the accuracy of its estimates with the service providers and make adjustments if necessary. The significant estimates in the Company’s accrued research and development expenses are related to expenses incurred with respect to CROs, CMOs and other vendors in connection with research and development and manufacturing activities. The Company bases its expense related to CROs and CMOs on its estimates of the services received and efforts expended pursuant to quotations and contracts with such vendors that conduct research and development and manufacturing activities on the Company’s behalf. The financial terms of these agreements are subject to negotiation, vary from contract to contract and may result in uneven payment flows. There may be instances in which payments made to the Company’s vendors will exceed the level of services provided and result in a prepayment of the applicable research and development or manufacturing expense. In accruing service fees, the Company estimates the time period over which services will be performed and the level of effort to be expended in each period. If the actual timing of the performance of services or the level of effort varies from its estimate, the Company adjusts the accrual or prepaid expense accordingly. Although the Company does not expect its estimates to be materially different from amounts actually incurred, the Company’s understanding of the status and timing of services performed relative to the actual status and timing of services performed may vary and could result in us reporting amounts that are too high or too low in any particular period. There have been no material changes in estimates for the periods presented. Stock-based compensation expense The Company follows the provisions of ASC 718, Compensation—Stock Compensation Stock Options The Company estimates the fair value of stock options on the date of grant using the Black-Scholes option-pricing model. Due to the lack of trading history, the Company’s computation of stock-price volatility is based on the volatility rates of comparable publicly held companies over a period equal to the expected term of the options granted by the Company. The Company’s computation of expected term is determined using the “simplified” method, which is the midpoint between the vesting date and the end of the contractual term. The Company believes that it does not have sufficient reliable exercise data in order to justify the use of a method other than the “simplified” method of estimating the expected exercise term of employee stock option grants. The Company utilizes a dividend yield of zero based on the fact that the Company has never paid cash dividends to stockholders and has no current intentions to pay cash dividends. The risk-free interest rate is based on the zero-coupon U.S. Treasury yield at the date of grant for a term equivalent to the expected term of the option. Stock-based compensation expense is included in both research and development expenses and general and administrative expenses in the Statements of Comprehensive Loss. Income taxes The Company utilizes the liability method of accounting for deferred income taxes, as set forth in ASC 740, Income Taxes. Recent accounting pronouncements The Company considers the applicability and impact of all Accounting Standards Updates (“ASUs”). ASUs not discussed below were assessed and determined to be either not applicable or are expected to have minimal impact on the Company’s financial statements. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) , approximately 64 months from the rent commencement date , with base annual lease payments of approximately $ 0.2 million. Upon commencement of the lease, which occurred in October 2020, the lease will be accounted for as an operating lease. The Company currently estimates that the initial right-of-use asset (ROU) to be recorded on its balance sheets will be approximately $ 0.3 to $ 0.5 million. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820) In August 2018, the FASB issued ASU No. 2018-15, Intangibles - Goodwill and Other - Internal-Use Software Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract In November 2018, the FASB issued ASU No. 2018-18, Collaborative Arrangements (Topic 808) |
CAPITALIZATION
CAPITALIZATION | 9 Months Ended |
Sep. 30, 2020 | |
Capitalization | |
CAPITALIZATION | 4. CAPITALIZATION As of September 30, 2020, the Company had authorized 100,000,000 shares of common stock, $ 0.0001 par value per share, of which 56,487,891 shares were issued and outstanding. In addition, as of September 30, 2020, the Company had authorized 25,000,000 shares of preferred stock, $ 0.0001 par value per share, of which, none were issued and outstanding. As of December 31, 2019, the Company had authorized 100,000,000 shares of common stock, $ 0.0001 par value per share, of which 47,658,361 shares were issued and outstanding. In addition, as of December 31, 2019, the Company had authorized 25,000,000 shares of preferred stock, $ 0.0001 par value per share, of which, none were issued and outstanding. |
CASH, CASH EQUIVALENTS, AND MAR
CASH, CASH EQUIVALENTS, AND MARKETABLE SECURITIES | 9 Months Ended |
Sep. 30, 2020 | |
Cash and Cash Equivalents [Abstract] | |
CASH, CASH EQUIVALENTS, AND MARKETABLE SECURITIES | 5. CASH, CASH EQUIVALENTS, AND MARKETABLE SECURITIES The Company considers all highly liquid investments purchased with original maturities of 90 days or less at the date of purchase to be cash equivalents. Cash and cash equivalents as of September 30, 2020 and December 31, 2019 were $ 118.4 39.2 The Company considers securities with original maturities of greater than 90 days at the date of purchase to be available for sale securities. The Company held available for sale securities with a fair value totaling $ 28.7 46.2 The Company evaluates securities with unrealized losses, if any, to determine whether the decline in fair value has resulted from credit loss or other factors. As of September 30, 2020, the Company has not recognized any impairment or credit losses on the Company’s available for sale securities. While the Company classifies these securities as available for sale, the Company does not currently intend to sell its investments and the Company currently believes it has the ability to hold these investments until maturity. The following table summarizes the amortized cost, fair value and allowance for credit losses of the Company’s available for sale securities: SCHEDULE OF AVAILABLE FOR SALE SECURITIES September 30, 2020 Amortized Cost Gross Unrealized Gross Unrealized Fair Value U.S. Treasury securities $ 13,112 $ 27 $ — $ 13,139 Corporate debt securities 15,587 — (7 ) 15,580 Total $ 28,699 $ 27 $ (7 ) $ 28,719 December 31, 2019 Amortized Cost Gross Unrealized Gross Unrealized Fair Value U.S. Treasury securities $ 46,208 $ — $ — $ 46,208 Total $ 46,208 $ — $ — $ 46,208 The Company’s available for sale securities are reported at fair value on the Company’s balance sheets. Unrealized gains (losses) are reported within accumulated other comprehensive income (loss) in the Statements of Comprehensive Loss. The cost of securities sold and any realized gains/losses from the sale of available for sale securities are based on the specific identification method. The changes in accumulated other comprehensive income (loss) associated with the unrealized gain (loss) on available for sale securities during the three and nine months ended September 30, 2020 and 2019, respectively, were as follows: SCHEDULE OF ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Beginning balance $ 98 $ — $ — $ — Current period changes in fair value before reclassifications, net of tax (78 ) — 20 — Amounts reclassified from accumulated other comprehensive income (loss), net of tax — — — — Other comprehensive income (loss) (78 ) — 20 — Balance as of September 30, 2020 $ 20 $ — $ 20 $ — |
LICENSE AND OTHER AGREEMENTS
LICENSE AND OTHER AGREEMENTS | 9 Months Ended |
Sep. 30, 2020 | |
License And Other Agreements | |
LICENSE AND OTHER AGREEMENTS | 6. LICENSE AND OTHER AGREEMENTS In May 2018, the Company entered into an Asset Purchase Agreement with MacroGenics (the “MacroGenics Asset Purchase Agreement”) pursuant to which the Company acquired MacroGenics’ interest in teplizumab (renamed PRV-031), a humanized mAb for the treatment of Type 1 Diabetes (“T1D”). As partial consideration for the MacroGenics Asset Purchase Agreement, the Company granted MacroGenics a warrant to purchase 2,162,389 shares of the Company’s common stock at an exercise price of $ 2.50 per share. The Company is obligated to pay MacroGenics contingent milestone payments totaling $ 170.0 million upon the achievement of certain regulatory approval milestones, including $ 60.0 million payable within 90 days of an approval of a Biologics License Application (“BLA”) in the United States, which could occur in 2021. In addition, the Company is obligated to make contingent milestone payments to MacroGenics totaling $ 225.0 million upon the achievement of certain sales milestones. The Company has also agreed to pay MacroGenics a single-digit royalty on net sales of the product. The Company has also agreed to pay third-party obligations, including low single-digit royalties, a portion of which is creditable against royalties payable to MacroGenics, aggregate milestone payments of up to approximately $ 1.3 million and other consideration, for certain third-party intellectual property under agreements the Company assumed pursuant to the MacroGenics Asset Purchase Agreement. Further, the Company is required to pay MacroGenics a low double-digit percentage of certain consideration to the extent it is received in connection with a future grant of rights to PRV-031 by the Company to a third party. The Company is obligated to use reasonable commercial efforts to develop and seek regulatory approval for PRV-031. In May 2018, the Company entered into a License Agreement with MacroGenics, Inc. (the “MacroGenics License Agreement”), pursuant to which MacroGenics, Inc. (“MacroGenics”) granted the Company exclusive global rights for the purpose of developing and commercializing MGD010 (renamed PRV-3279), a humanized protein and a potential treatment for systemic lupus erythematosus (“SLE”) and other similar diseases. As partial consideration for the MacroGenics License Agreement, the Company granted MacroGenics a warrant to purchase 270,299 shares of the Company’s common stock at an exercise price of $ 2.50 per share. The Company is obligated to make contingent milestone payments to MacroGenics totaling $ 42.5 million upon the achievement of certain developmental and approval milestones for the first indication, and an additional $ 22.5 million upon the achievement of certain regulatory approvals for a second indication. In addition, the Company is obligated to make contingent milestone payments to MacroGenics totaling $ 225.0 million upon the achievement of certain sales milestones. The Company has also agreed to pay MacroGenics a single-digit royalty on net sales of the product. Further, the Company is required to pay MacroGenics a low double-digit percentage of certain consideration to the extent received in connection with a future grant of rights to PRV-3279 by the Company to a third party. The Company is obligated to use commercially reasonable efforts to develop and seek regulatory approval for PRV-3279. The license agreement may also be terminated by either party upon a material breach or bankruptcy of the other party, by Provention without cause upon prior notice to MacroGenics, and by MacroGenics in the event that the Company challenges the validity of any licensed patent under the agreement. As of September 30, 2020, the Company has not achieved any milestones that would trigger payments to MacroGenics. The Company recorded the warrants issued under the MacroGenics Asset Purchase Agreement and the MacroGenics License Agreement at an estimated fair value of $ 1.64 4.0 In July 2019, MacroGenics elected to exercise its warrants for an aggregate of 2,432,688 1,948,474 In November 2018, the Company entered into a License and Collaboration Agreement (the “Amgen Agreement”) with Amgen, Inc. (“Amgen”) for PRV-015 (formerly AMG 714), a novel anti-IL-15 monoclonal antibody being developed for the treatment of gluten-free diet non-responsive celiac disease (NRCD). Under the terms of the agreement, the Company will conduct and fund a Phase 2b trial in NRCD and lead the development and regulatory activities for the program. Amgen agreed to make an equity investment of up to $ 20.0 million in the Company, subject to certain terms and conditions set forth in the agreement. Amgen is also responsible for the manufacturing of PRV-015. Upon completion of the Phase 2b trial, a $ 150.0 million milestone payment is due from Amgen to the Company, plus an additional regulatory milestone payment, and single digit royalties on future sales; provided, however, that Amgen has the right to elect not to pay the $150.0 million milestone, in which case we will have an option to negotiate for the transfer to the Company of rights to AMG 714 pursuant to a termination license agreement between Amgen and the Company. The material terms of the termination license agreement have been negotiated and agreed and form part of the Amgen Agreement. Under the terms of the termination license agreement, the Company would be obligated to make certain contingent milestone payments to Amgen and other third parties totaling up to $ 70.0 million upon the achievement of certain clinical and regulatory milestones and a low double-digit royalty on net sales of any approved product based on the IL-15 technology. The agreement may be terminated by either party upon a material breach or upon an insolvency event and by Amgen if we are not able to fund our clinical development obligations (among other termination triggers). The agreement expires upon the expiration of Amgen’s last obligation to make royalty payments to Provention. In September 2019, in a private placement completed concurrently with the Company’s underwritten public offering, Amgen purchased 2,500,000 shares of the Company’s common stock at the underwritten public offering price of $ 8.00 per share, for a total investment of $ 20.0 million. In April 2017, the Company entered into a License Agreement with Vactech Ltd. (the “Vactech License Agreement”), pursuant to which Vactech Ltd. (“Vactech”) granted the Company exclusive global rights for the purpose of developing and commercializing the group B coxsackie virus vaccine (CVB) platform technology. In consideration of the licenses and other rights granted by Vactech, the Company issued two million shares of its common stock to Vactech. The Company recorded the issuance of the shares at their estimated fair value of approximately $ 1.70 per share for a total of $ 3.4 million as a license fee expense included as part of Research & Development Expense for the year ended December 31, 2017. Provention paid Vactech a total of approximately $ 0.5 million for transition and advisory services during the first 18 months of the term of the agreement. In addition, Provention may be obligated to make a series of contingent milestone payments to Vactech totaling up to an additional $ 24.5 million upon the achievement of certain clinical development and regulatory filing milestones. In addition, the Company has agreed to pay Vactech tiered single-digit royalties on net sales of any approved product based on the CVB platform technology and three additional payments totaling $ 19.0 million upon the achievement of certain annual net sales levels. The Vactech License Agreement may be terminated by the Company on a country by country basis without cause (in which case the exclusive global rights to the technology will transfer back to Vactech) and by either party upon a material breach or insolvency of the other party. If the Company terminates the agreement with respect to two or more specified European countries, the agreement will be deemed terminated with respect to all of the EU, and if the Company terminates the agreement with respect to the United States, the agreement will be deemed terminated with respect to all of North America. The agreement expires upon the expiration of the Company’s last obligation to make royalty payments to Vactech. As of September 30, 2020, the Company has not achieved any milestones that would trigger payments to Vactech. In March 2018, the Company entered into a Development Services Agreement with The Institute of Translational Vaccinology (the “Intravacc Development Services Agreement”), pursuant to which The Institute of Translational Vaccinology (“Intravacc”) will provide services related to process development, non-GMP and GMP manufacturing of the Company’s polyvalent CVB vaccine, including providing proprietary technology for manufacturing purposes. The Company will pay Intravacc approximately 10 million euros for their services over the development and manufacturing period. Each party retains its existing intellectual property and will share newly developed intellectual property via a fully-paid non-exclusive license between the parties for all development work through phase 1 clinical trials. Any future use, including commercial use, of Intravacc’s technology will be subject to a separate nonexclusive license agreement. The Intravacc Development Services Agreement may be terminated by us with ninety days’ notice without cause and by either party upon a material breach or insolvency of the other party. As of September 30, 2020, the Company had paid Intravacc a total of approximately 9.0 million euros, or approximately $ 10.5 million, for services provided by Intravacc under the Intravacc Development Services Agreement. In April 2017, the Company entered into the Janssen CSF-1R License Agreement, pursuant to which Janssen Pharmaceutica NV (“Janssen”) granted the Company exclusive global rights to technology owned or controlled by Janssen Pharmaceutica NV for the purpose of developing and commercializing a colony stimulating factor 1 receptor (CSF-1R) inhibitor named JNJ-40346527 (renamed PRV-6527) for inflammatory bowel diseases including Crohn’s disease and UC. The Company evaluated PRV-6527 for Crohn’s disease in a recently completed Phase 2a clinical trial (the PRINCE study). In December 2019, Janssen declined its option to buy back the rights to PRV-6527 and as such, all rights will remain with the Company. The Company will be obligated to make contingent milestone payments to Janssen totaling $ 35.0 million upon the achievement of certain clinical and regulatory milestones for the first indication and an additional $ 20.0 million upon the achievement of certain clinical and regulatory milestones for a second indication. In addition, the Company has agreed to pay Janssen tiered single-digit royalties on net sales of any approved product based on the CSF-1R technology and three additional payments totaling $ 100.0 million upon the achievement of certain annual net sales levels. As of September 30, 2020, no milestones have been achieved that would trigger payments to Janssen under the CSF-1R License Agreement. The Company is not actively developing PRV-6527. |
NET LOSS PER SHARE OF COMMON ST
NET LOSS PER SHARE OF COMMON STOCK | 9 Months Ended |
Sep. 30, 2020 | |
Earnings Per Share [Abstract] | |
NET LOSS PER SHARE OF COMMON STOCK | 7. NET LOSS PER SHARE OF COMMON STOCK Basic and diluted net income (loss) per common share is determined by dividing net income (loss) by the weighted average common shares outstanding during the period. For the periods where there is a net loss, stock options and warrants have been excluded from the calculation of diluted net loss per common share because their effect would be anti-dilutive. Therefore, the weighted average common shares used to calculate both basic and diluted net loss per common share would be the same. The following table sets forth the computation of basic and diluted net loss per share of common stock for the periods indicated: SCHEDULE OF COMPUTATION OF BASIC AND DILUTED LOSS PER SHARE Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Net loss $ (31,301 ) $ (9,769 ) $ (66,005 ) $ (32,745 ) Weighted average shares of common stock outstanding - basic and diluted 56,339 40,512 51,098 38,424 Net loss per share of common stock, basic and diluted $ (0.56 ) $ (0.24 ) $ (1.29 ) $ (0.85 ) The following potentially dilutive securities have been excluded from the computation of diluted weighted average shares outstanding as they would be antidilutive: SCHEDULE OF ANTIDILUTIVE SECURITIES EXCLUDED FROM COMPUTATION OF EARNINGS PER SHARE Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Stock options 9,452 5,934 9,452 5,934 Warrants 1,705 2,125 1,705 2,125 |
ACCRUED EXPENSES
ACCRUED EXPENSES | 9 Months Ended |
Sep. 30, 2020 | |
Payables and Accruals [Abstract] | |
ACCRUED EXPENSES | 8. ACCRUED EXPENSES Accrued expenses consisted of the following: SCHEDULE OF ACCRUED EXPENSES September 30, 2020 December 31, 2019 Accrued research and development costs $ 5,725 $ 1,700 Accrued pre-commercial costs 1,604 — Accrued compensation 1,235 54 Accrued professional fees 637 221 Other accrued liabilities 98 90 Total accrued expenses $ 9,299 $ 2,065 |
FAIR VALUE OF ASSETS AND LIABIL
FAIR VALUE OF ASSETS AND LIABILITIES | 9 Months Ended |
Sep. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE OF ASSETS AND LIABILITIES | 9. FAIR VALUE OF ASSETS AND LIABILITIES The carrying amounts reported in the balance sheet for cash and cash equivalents, accounts payable and accrued expenses approximate fair value based on the short-term nature of these items. In accordance with accounting principles generally accepted in the United States, fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A three-level hierarchy prioritizes the inputs used to measure fair value as follows: Level 1 – Valuation is based on quoted prices in active markets for identical assets or liabilities. Level 1 assets and liabilities generally include debt and equity securities that are traded in an active exchange market. Valuations are obtained from readily available pricing sources for market transactions involving identical assets or liabilities. Level 2 – Valuation is based on observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 – Valuation is based on unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Level 3 assets and liabilities include financial instruments whose value is determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant management judgment or estimation. The following is a summary of assets and their related classifications under the fair value hierarchy: SCHEDULE OF ASSETS AND LIABILITIES MEASURED AT FAIR VALUE ON RECURRING BASIS September 30, 2020 Financial Instruments Carried at Fair Value Quoted prices in active markets for Significant other Significant Total Assets: Cash and cash equivalents 1 $ 118,439 $ — $ — $ 118,439 Investments in U.S. Treasury securities 2 13,139 — — 13,139 Investments in Corporate debt securities 2 — 15,580 — 15,580 December 31, 2019 Financial Instruments Carried at Fair Value Quoted prices in active markets for Significant other Significant Total Assets: Cash and cash equivalents 1 $ 39,165 $ — $ — $ 39,165 Investments in U.S. Treasury securities 2 46,208 — — 46,208 1 Cash and cash equivalents primarily include investments in money market funds and U.S. Treasury securities with maturity dates within 90 days from the purchase date 2 Investments in U.S. Treasury and investment-grade corporate debt securities are classified as available for sale securities |
STOCK OPTIONS
STOCK OPTIONS | 9 Months Ended |
Sep. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
STOCK OPTIONS | 10. STOCK OPTIONS In 2017, the Company adopted the Provention Bio, Inc. 2017 Equity Incentive Plan (the “2017 Plan”). Pursuant to the 2017 Plan, the Company’s Board of Directors may grant incentive stock options, nonqualified stock options, and restricted stock to employees, officers, directors, consultants and advisors. As of September 30, 2020, there were options to purchase an aggregate of 9,452,394 shares of common stock outstanding under the 2017 Plan. Options issued under the 2017 Plan are exercisable for up to 10 years from the date of issuance. In 2018, the Company amended and restated its 2017 Plan to, among other things, include an evergreen provision, which would automatically increase the number of shares available for issuance under the 2017 Plan in an amount equal to (1) the difference between (x) 18% of the total shares of the Company’s common stock outstanding, on a fully diluted basis, on December 31st of the preceding calendar year, and (y) the total number of shares of the Company’s common stock reserved under the 2017 Plan on December 31st of such preceding calendar year or (2) an amount less than this calculated increase as determined by the board of directors. In connection with the evergreen provisions of the 2017 Plan, the number of shares available for issuance under the 2017 Plan was increased by 3,000,000 shares, as determined by the board of directors under the provisions described above, effective as of January 1, 2020. As of September 30, 2020, there were 190,333 shares available for future grants. Stock-based compensation Total stock-based compensation expense recognized for both employees and non-employees was as follows: SCHEDULE OF STOCK-BASED COMPENSATION EXPENSE Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 General and administrative $ 1,841 $ 545 $ 3,402 $ 874 Research and development 874 378 1,826 754 Total share-based compensation expense $ 2,715 $ 923 $ 5,228 $ 1,628 Option activity The Company grants options with service-based vesting requirements as well as options with performance-based vesting requirements. Generally, the service-based requirements vest over a four-year period in multiple tranches. Each tranche of the performance-based component vests upon the achievement of a specific milestone. These milestones are related to the Company’s clinical trials, manufacturing activities, regulatory activities, commercial activities and certain other performance metrics. A summary of option activity for the nine months ended September 30, 2020 are presented below: SUMMARY OF STOCK OPTION ACTIVITY Weighted- Weighted- Average Average Remaining Underlying Exercise Contractual Intrinsic Stock Option Awards Shares Price Term Value Outstanding at December 31, 2019 5,894 $ 6.33 8.5 $ — Granted 3,871 $ 12.74 Exercised (189 ) $ 4.57 Forfeited or expired (124 ) $ 5.23 Outstanding at September 30, 2020 9,452 $ 9.00 8.6 $ 38,231 Exercisable at September 30, 2020 2,776 $ 4.31 7.3 $ 23,816 The weighted average grant-date fair value of options granted during the nine months ended September 30, 2020 was $ 8.24 2,720,000 20.0 3,956,000 25.3 3.4 Cash proceeds from, and the aggregate intrinsic value of, stock options exercised during the periods presented below were as follows: SCHEDULE OF AGGREGATED INTRINSIC VALUE OF STOCK OPTION EXERCISED Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Cash proceeds from options exercised $ 287 $ 198 $ 861 $ 219 Aggregate intrinsic value of options exercised 526 292 1,480 373 The Company uses the Black-Scholes option-pricing model to estimate the fair value of option awards with the following weighted-average assumptions for the period indicated: SCHEDULE OF SHARE-BASED COMPENSATION VALUATION OF ASSUMPTIONS Nine Months Ended September 30, 2020 2019 Exercise price $ 12.74 $ 10.34 Expected volatility 74 72% Expected dividends — — Expected term (in years) 6.2 6.3 Risk-free interest rate 0.59% 1.91% The weighted-average valuation assumptions were determined as follows: ● Risk-free interest rate: The Company bases the risk-free interest rate on the interest rate payable on U.S. Treasury securities in effect at the time of grant for a period that is commensurate with the assumed expected option term. ● Expected annual dividends: The estimate for annual dividends is 0 ● Expected stock price volatility: The expected volatility used is based on historical volatilities of similar entities within the Company’s industry which were commensurate with the Company’s expected term assumption. ● Expected term of options: The expected term of options represents the period of time options are expected to be outstanding. The expected term of the options granted to employees is derived from the “simplified” method as described in Staff Accounting Bulletin 107 relating to stock-based compensation, whereby the expected term is an average between the vesting period and contractual period due to the limited operating history. |
WARRANTS
WARRANTS | 9 Months Ended |
Sep. 30, 2020 | |
Warrants and Rights Note Disclosure [Abstract] | |
WARRANTS | 11. WARRANTS In connection with the April 2017 sale of Series A Convertible Redeemable Preferred Stock, the Company issued warrants to MDB, the Placement Agent, and its designees to purchase 558,740 2.50 seven-year term 558,740 159,689 312,689 129,822 259,542 316,754 241,986 In connection with the Company’s completion of its IPO, in July 2018, the Company issued to MDB, the underwriter in the IPO, and its designees warrants to purchase 1,596,956 5.00 These warrants have a five-year term 107,051 66,316 134,114 1,462,842 |
INCOME TAXES
INCOME TAXES | 9 Months Ended |
Sep. 30, 2020 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | 12. INCOME TAXES In April 2020, the Company completed the sale of approximately $ 6.8 0.5 0.5 On March 27, 2020, the US government enacted the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) which includes numerous modifications to income tax provisions, including a limitation on business interest expense and net operating loss provisions and the acceleration of alternative minimum tax credits. Given the Company’s history of losses, the CARES Act is not expected to have a material impact on its income tax positions. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 9 Months Ended |
Sep. 30, 2020 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | 13. SUBSEQUENT EVENTS On October 29, 2020, the Company adopted the Provention Bio, Inc. 2020 Inducement Plan (the “2020 Inducement Plan”). Pursuant to the terms of the 2020 Inducement Plan, the Company may grant nonstatutory stock options, stock appreciation rights, restricted stock unit awards and restricted stock for up to a total of 2,000,000 |
SIGNIFICANT ACCOUNTING POLICI_2
SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
Use of estimates | Use of estimates The process of preparing financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of assets and liabilities at the date of financial statements and the reported amounts of expenses during the reporting period. Actual results could differ from those estimates and changes in estimates may occur. |
Segment and geographic information | Segment and geographic information 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. The Company views its operations and manages its business in one |
Cash, cash equivalents and concentration of credit risk | Cash, cash equivalents and concentration of credit risk The Company considers only those investments which are highly liquid, readily convertible to cash, or that mature within 90 days from the date of purchase to be cash equivalents. Marketable securities are those investments with original maturities in excess of 90 days. The carrying amounts reported in the balance sheets for cash and cash equivalents are valued at cost, which approximates their fair value. The Company has no off-balance-sheet concentration of credit risk such as foreign exchange contracts, option contracts or other hedging arrangements. The Company holds cash and cash equivalents in banks in excess of FDIC insurance limits. However, the Company believes risk of loss is minimal as the cash and cash equivalents are held by large, highly-rated financial institutions. |
Marketable securities | Marketable securities The Company considers securities with original maturities of greater than 90 days to be available for sale securities. Available for sale securities are classified as either current or non-current assets based on the nature of the securities and their availability for use in current operations. Available for sale securities are recorded at fair value and unrealized gains and losses are recorded within accumulated other comprehensive income. The estimated fair value of the available for sale securities is determined based on quoted market prices or rates for similar instruments. In addition, the cost of debt securities in this category is adjusted for amortization of premium and accretion of discount to maturity. On a quarterly basis, the Company reviews the status of each security in an unrealized loss position, to evaluate the existence of potential credit losses. The Company first considers whether it intends to sell, or if it is more likely than not that the Company will be required to sell the security before recovery of its amortized cost basis. If either of the criteria regarding intent or requirement to sell is met, the security’s amortized cost basis is written down to fair value through income. For securities that do not meet this criteria, the Company considers a number of factors to determine if the decline in fair value has resulted from credit losses or other factors, including but not limited to: (1) the extent of the decline; (2) changes to the rating of the security by a rating agency; (3) any adverse conditions specific to the security; and (4) other market conditions that may affect the fair value of the security. If this assessment indicates that a credit loss exists and the present value of cash flows expected to be collected is less than the amortized cost basis, an allowance for credit losses is required for the credit loss. Any impairment that has not been recorded through an allowance for credit losses is recognized in other comprehensive income. As of September 30, 2020, the Company has not recognized any impairment or credit losses on its available for sale securities. |
Financial instruments | Financial instruments Cash, cash equivalents and marketable securities are reflected in the accompanying financial statements at fair value. The carrying amount of accounts payable and accrued expenses, including accrued research and development expenses, approximates fair value due to the short-term nature of those instruments. |
Fixed assets, net | Fixed assets, net Fixed assets, which consists primarily of leasehold improvements, furniture and fixtures, office equipment and certain clinical equipment, are carried at cost less accumulated depreciation. Depreciation is computed over the estimated useful lives of the respective assets, generally three seven |
Foreign currency translation | Foreign currency translation The Company considers the U.S. dollar to be its functional currency. Expenses denominated in foreign currencies are translated at the exchange rate on the date the expense is incurred. The effect of exchange rate fluctuations on translating foreign currency assets and liabilities into U.S. dollars is included in the Statements of Comprehensive Loss. Foreign exchange transaction gains and losses are included in the results of operations and are not material in the Company’s financial statements. |
Accrued research and development expenses | Research and development expenses Research and development expenses primarily consist of costs associated with the preclinical and clinical development of the Company’s product candidate portfolio, including the following: ● external research and development expenses incurred under arrangements with third parties, such as contract research organizations (“CROs”) and other vendors and contract manufacturing organizations (“CMOs”) for the production of drug substance and drug product; and ● employee-related expenses, including salaries, benefits and share-based compensation expense. Research and development expenses also include costs of acquired product licenses and related technology rights where there is no alternative future use, costs of prototypes used in research and development, consultant fees and amounts paid to certain of our collaborative partners. All research and development expenses are charged to operations as incurred in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic (“ASC”) 730, Research and Development Accrued research and development expenses As part of the process of preparing our financial statements, the Company is required to estimate its accrued expenses. This process involves reviewing quotations and contracts, identifying services that have been performed on the Company’s behalf and estimating the level of service performed and the associated cost incurred for the service when the Company has not yet been invoiced or otherwise notified of the actual cost. The majority of the Company’s service providers invoice the Company monthly in arrears for services performed or when contractual milestones are met. The Company makes estimates of its accrued expenses as of each balance sheet date in our financial statements based on facts and circumstances known to the Company at that time. The Company periodically confirms the accuracy of its estimates with the service providers and make adjustments if necessary. The significant estimates in the Company’s accrued research and development expenses are related to expenses incurred with respect to CROs, CMOs and other vendors in connection with research and development and manufacturing activities. The Company bases its expense related to CROs and CMOs on its estimates of the services received and efforts expended pursuant to quotations and contracts with such vendors that conduct research and development and manufacturing activities on the Company’s behalf. The financial terms of these agreements are subject to negotiation, vary from contract to contract and may result in uneven payment flows. There may be instances in which payments made to the Company’s vendors will exceed the level of services provided and result in a prepayment of the applicable research and development or manufacturing expense. In accruing service fees, the Company estimates the time period over which services will be performed and the level of effort to be expended in each period. If the actual timing of the performance of services or the level of effort varies from its estimate, the Company adjusts the accrual or prepaid expense accordingly. Although the Company does not expect its estimates to be materially different from amounts actually incurred, the Company’s understanding of the status and timing of services performed relative to the actual status and timing of services performed may vary and could result in us reporting amounts that are too high or too low in any particular period. There have been no material changes in estimates for the periods presented. |
Stock-based compensation expense | Stock-based compensation expense The Company follows the provisions of ASC 718, Compensation—Stock Compensation Stock Options The Company estimates the fair value of stock options on the date of grant using the Black-Scholes option-pricing model. Due to the lack of trading history, the Company’s computation of stock-price volatility is based on the volatility rates of comparable publicly held companies over a period equal to the expected term of the options granted by the Company. The Company’s computation of expected term is determined using the “simplified” method, which is the midpoint between the vesting date and the end of the contractual term. The Company believes that it does not have sufficient reliable exercise data in order to justify the use of a method other than the “simplified” method of estimating the expected exercise term of employee stock option grants. The Company utilizes a dividend yield of zero based on the fact that the Company has never paid cash dividends to stockholders and has no current intentions to pay cash dividends. The risk-free interest rate is based on the zero-coupon U.S. Treasury yield at the date of grant for a term equivalent to the expected term of the option. Stock-based compensation expense is included in both research and development expenses and general and administrative expenses in the Statements of Comprehensive Loss. |
Income taxes | Income taxes The Company utilizes the liability method of accounting for deferred income taxes, as set forth in ASC 740, Income Taxes. |
Recent accounting pronouncements | Recent accounting pronouncements The Company considers the applicability and impact of all Accounting Standards Updates (“ASUs”). ASUs not discussed below were assessed and determined to be either not applicable or are expected to have minimal impact on the Company’s financial statements. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) , approximately 64 months from the rent commencement date , with base annual lease payments of approximately $ 0.2 million. Upon commencement of the lease, which occurred in October 2020, the lease will be accounted for as an operating lease. The Company currently estimates that the initial right-of-use asset (ROU) to be recorded on its balance sheets will be approximately $ 0.3 to $ 0.5 million. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820) In August 2018, the FASB issued ASU No. 2018-15, Intangibles - Goodwill and Other - Internal-Use Software Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract In November 2018, the FASB issued ASU No. 2018-18, Collaborative Arrangements (Topic 808) |
CASH, CASH EQUIVALENTS, AND M_2
CASH, CASH EQUIVALENTS, AND MARKETABLE SECURITIES (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Cash and Cash Equivalents [Abstract] | |
SCHEDULE OF AVAILABLE FOR SALE SECURITIES | The following table summarizes the amortized cost, fair value and allowance for credit losses of the Company’s available for sale securities: SCHEDULE OF AVAILABLE FOR SALE SECURITIES September 30, 2020 Amortized Cost Gross Unrealized Gross Unrealized Fair Value U.S. Treasury securities $ 13,112 $ 27 $ — $ 13,139 Corporate debt securities 15,587 — (7 ) 15,580 Total $ 28,699 $ 27 $ (7 ) $ 28,719 December 31, 2019 Amortized Cost Gross Unrealized Gross Unrealized Fair Value U.S. Treasury securities $ 46,208 $ — $ — $ 46,208 Total $ 46,208 $ — $ — $ 46,208 |
SCHEDULE OF ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | SCHEDULE OF ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Beginning balance $ 98 $ — $ — $ — Current period changes in fair value before reclassifications, net of tax (78 ) — 20 — Amounts reclassified from accumulated other comprehensive income (loss), net of tax — — — — Other comprehensive income (loss) (78 ) — 20 — Balance as of September 30, 2020 $ 20 $ — $ 20 $ — |
NET LOSS PER SHARE OF COMMON _2
NET LOSS PER SHARE OF COMMON STOCK (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Earnings Per Share [Abstract] | |
SCHEDULE OF COMPUTATION OF BASIC AND DILUTED LOSS PER SHARE | The following table sets forth the computation of basic and diluted net loss per share of common stock for the periods indicated: SCHEDULE OF COMPUTATION OF BASIC AND DILUTED LOSS PER SHARE Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Net loss $ (31,301 ) $ (9,769 ) $ (66,005 ) $ (32,745 ) Weighted average shares of common stock outstanding - basic and diluted 56,339 40,512 51,098 38,424 Net loss per share of common stock, basic and diluted $ (0.56 ) $ (0.24 ) $ (1.29 ) $ (0.85 ) |
SCHEDULE OF ANTIDILUTIVE SECURITIES EXCLUDED FROM COMPUTATION OF EARNINGS PER SHARE | The following potentially dilutive securities have been excluded from the computation of diluted weighted average shares outstanding as they would be antidilutive: SCHEDULE OF ANTIDILUTIVE SECURITIES EXCLUDED FROM COMPUTATION OF EARNINGS PER SHARE Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Stock options 9,452 5,934 9,452 5,934 Warrants 1,705 2,125 1,705 2,125 |
ACCRUED EXPENSES (Tables)
ACCRUED EXPENSES (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Payables and Accruals [Abstract] | |
SCHEDULE OF ACCRUED EXPENSES | Accrued expenses consisted of the following: SCHEDULE OF ACCRUED EXPENSES September 30, 2020 December 31, 2019 Accrued research and development costs $ 5,725 $ 1,700 Accrued pre-commercial costs 1,604 — Accrued compensation 1,235 54 Accrued professional fees 637 221 Other accrued liabilities 98 90 Total accrued expenses $ 9,299 $ 2,065 |
FAIR VALUE OF ASSETS AND LIAB_2
FAIR VALUE OF ASSETS AND LIABILITIES (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
SCHEDULE OF ASSETS AND LIABILITIES MEASURED AT FAIR VALUE ON RECURRING BASIS | The following is a summary of assets and their related classifications under the fair value hierarchy: SCHEDULE OF ASSETS AND LIABILITIES MEASURED AT FAIR VALUE ON RECURRING BASIS September 30, 2020 Financial Instruments Carried at Fair Value Quoted prices in active markets for Significant other Significant Total Assets: Cash and cash equivalents 1 $ 118,439 $ — $ — $ 118,439 Investments in U.S. Treasury securities 2 13,139 — — 13,139 Investments in Corporate debt securities 2 — 15,580 — 15,580 December 31, 2019 Financial Instruments Carried at Fair Value Quoted prices in active markets for Significant other Significant Total Assets: Cash and cash equivalents 1 $ 39,165 $ — $ — $ 39,165 Investments in U.S. Treasury securities 2 46,208 — — 46,208 1 Cash and cash equivalents primarily include investments in money market funds and U.S. Treasury securities with maturity dates within 90 days from the purchase date 2 Investments in U.S. Treasury and investment-grade corporate debt securities are classified as available for sale securities |
STOCK OPTIONS (Tables)
STOCK OPTIONS (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
SCHEDULE OF STOCK-BASED COMPENSATION EXPENSE | Total stock-based compensation expense recognized for both employees and non-employees was as follows: SCHEDULE OF STOCK-BASED COMPENSATION EXPENSE Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 General and administrative $ 1,841 $ 545 $ 3,402 $ 874 Research and development 874 378 1,826 754 Total share-based compensation expense $ 2,715 $ 923 $ 5,228 $ 1,628 |
SUMMARY OF STOCK OPTION ACTIVITY | A summary of option activity for the nine months ended September 30, 2020 are presented below: SUMMARY OF STOCK OPTION ACTIVITY Weighted- Weighted- Average Average Remaining Underlying Exercise Contractual Intrinsic Stock Option Awards Shares Price Term Value Outstanding at December 31, 2019 5,894 $ 6.33 8.5 $ — Granted 3,871 $ 12.74 Exercised (189 ) $ 4.57 Forfeited or expired (124 ) $ 5.23 Outstanding at September 30, 2020 9,452 $ 9.00 8.6 $ 38,231 Exercisable at September 30, 2020 2,776 $ 4.31 7.3 $ 23,816 |
SCHEDULE OF AGGREGATED INTRINSIC VALUE OF STOCK OPTION EXERCISED | Cash proceeds from, and the aggregate intrinsic value of, stock options exercised during the periods presented below were as follows: SCHEDULE OF AGGREGATED INTRINSIC VALUE OF STOCK OPTION EXERCISED Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Cash proceeds from options exercised $ 287 $ 198 $ 861 $ 219 Aggregate intrinsic value of options exercised 526 292 1,480 373 |
SCHEDULE OF SHARE-BASED COMPENSATION VALUATION OF ASSUMPTIONS | The Company uses the Black-Scholes option-pricing model to estimate the fair value of option awards with the following weighted-average assumptions for the period indicated: SCHEDULE OF SHARE-BASED COMPENSATION VALUATION OF ASSUMPTIONS Nine Months Ended September 30, 2020 2019 Exercise price $ 12.74 $ 10.34 Expected volatility 74 72% Expected dividends — — Expected term (in years) 6.2 6.3 Risk-free interest rate 0.59% 1.91% |
LIQUIDITY (Details Narrative)
LIQUIDITY (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | Sep. 30, 2020 | Aug. 30, 2019 | Sep. 30, 2019 | Jul. 31, 2018 | Apr. 30, 2017 | Jun. 30, 2019 | Sep. 30, 2020 | Dec. 31, 2019 |
Schedule of Capitalization, Equity [Line Items] | ||||||||
Retained Earnings (Accumulated Deficit) | $ 145,066 | $ 145,066 | $ 79,061 | |||||
Sale of Stock, Number of Shares Issued in Transaction | 5,750,000 | |||||||
Sale of Stock, Price Per Share | $ 8 | |||||||
Underwriting discounts and commissions | $ 2,800 | 6,600 | ||||||
Other offering expenses | 500 | 200 | ||||||
Aggregate net proceeds from underwritten public offering and Amgen private placement | $ 62,700 | |||||||
Proceeds From Issuance Or Sale Of Equity Offering | 103,300 | |||||||
At-the-market [Member] | ||||||||
Schedule of Capitalization, Equity [Line Items] | ||||||||
Sale of Stock, Number of Shares Issued in Transaction | 725,495 | |||||||
Sale of Stock, Consideration Received on Transaction | $ 9,900 | |||||||
Accrued Sales Commission | $ 300 | $ 300 | ||||||
At-the-market [Member] | Maximum [Member] | ||||||||
Schedule of Capitalization, Equity [Line Items] | ||||||||
Maximum number of shares of common stock sole | $ 50,000 | |||||||
Options Held [Member] | ||||||||
Schedule of Capitalization, Equity [Line Items] | ||||||||
Sale of Stock, Number of Shares Issued in Transaction | 750,000 | |||||||
Sale of Stock, Price Per Share | $ 8 | |||||||
IPO [Member] | ||||||||
Schedule of Capitalization, Equity [Line Items] | ||||||||
Sale of Stock, Number of Shares Issued in Transaction | 15,969,563 | |||||||
Sale of Stock, Price Per Share | $ 4 | |||||||
Proceeds from Issuance Initial Public Offering | $ 59,300 | |||||||
Underwriting discounts and commissions | 3,700 | |||||||
Other offering expenses | $ 800 | |||||||
Conversion of Stock, Shares Converted | 11,381,999 | |||||||
IPO [Member] | MDB Capital Group, LLC [Member] | ||||||||
Schedule of Capitalization, Equity [Line Items] | ||||||||
Class of Warrant or Right, Number of Securities Called by Each Warrant or Right | 1,596,956 | |||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 5 | |||||||
Private Placement [Member] | Amgen Inc [Member] | ||||||||
Schedule of Capitalization, Equity [Line Items] | ||||||||
Sale of Stock, Number of Shares Issued in Transaction | 2,500,000 | |||||||
Sale of Stock, Price Per Share | $ 8 | |||||||
Underwritten Public Offering [Member] | ||||||||
Schedule of Capitalization, Equity [Line Items] | ||||||||
Sale of Stock, Number of Shares Issued in Transaction | 7,590,000 | |||||||
Sale of Stock, Price Per Share | $ 14.50 | $ 14.50 | ||||||
Underwriter's Option [Member] | ||||||||
Schedule of Capitalization, Equity [Line Items] | ||||||||
Stock Issued During Period, Shares, New Issues | 990,000 | |||||||
Shares Issued, Price Per Share | $ 14.50 | $ 14.50 | ||||||
Series A Convertible Redeemable Preferred Stock [Member] | ||||||||
Schedule of Capitalization, Equity [Line Items] | ||||||||
Stock Issued During Period, Shares, New Issues | 11,381,999 | |||||||
Shares Issued, Price Per Share | $ 2.50 | |||||||
Proceeds from Issuance of Redeemable Convertible Preferred Stock | $ 26,700 | |||||||
Series A Convertible Redeemable Preferred Stock [Member] | IPO [Member] | ||||||||
Schedule of Capitalization, Equity [Line Items] | ||||||||
Class of Warrant or Right, Number of Securities Called by Each Warrant or Right | 558,740 |
SIGNIFICANT ACCOUNTING POLICI_3
SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) $ in Millions | 1 Months Ended | 9 Months Ended |
Jul. 31, 2020USD ($) | Sep. 30, 2020Segment | |
Property, Plant and Equipment [Line Items] | ||
Number of Operating Segments | Segment | 1 | |
[custom:LesseeOperatingLeaseTermOfContractDescription] | approximately 64 months from the rent commencement date | |
Operating Lease, Payments | $ 0.2 | |
Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Fixed assets estimated useful life years | three | |
Operating Lease, Right-of-Use Asset | 0.3 | |
Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Fixed assets estimated useful life years | seven | |
Operating Lease, Right-of-Use Asset | $ 0.5 |
CAPITALIZATION (Details Narrati
CAPITALIZATION (Details Narrative) - $ / shares | Sep. 30, 2020 | Dec. 31, 2019 |
Capitalization | ||
Common Stock, Shares Authorized | 100,000,000 | 100,000,000 |
Common Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 |
Common Stock, Shares, Outstanding | 56,487,891 | 47,658,361 |
Preferred Stock, Shares Authorized | 25,000,000 | 25,000,000 |
Preferred Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 |
Preferred Stock, Shares Outstanding | 0 | 0 |
SCHEDULE OF AVAILABLE FOR SALE
SCHEDULE OF AVAILABLE FOR SALE SECURITIES (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Cash and Cash Equivalents [Line Items] | ||
Amortized Cost | $ 28,699 | $ 46,208 |
Gross Unrealized Gains | 27 | |
Gross Unrealized Losses | (7) | |
Fair Value | 28,719 | 46,208 |
US Treasury Securities [Member] | ||
Cash and Cash Equivalents [Line Items] | ||
Amortized Cost | 13,112 | 46,208 |
Gross Unrealized Gains | 27 | |
Gross Unrealized Losses | ||
Fair Value | 13,139 | $ 46,208 |
Corporate Debt Securities [Member] | ||
Cash and Cash Equivalents [Line Items] | ||
Amortized Cost | 15,587 | |
Gross Unrealized Gains | ||
Gross Unrealized Losses | (7) | |
Fair Value | $ 15,580 |
SCHEDULE OF ACCUMULATED OTHER C
SCHEDULE OF ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Cash and Cash Equivalents [Abstract] | ||||
Beginning balance | $ 98 | |||
Current period changes in fair value before reclassifications, net of tax | (78) | 20 | ||
Amounts reclassified from accumulated other comprehensive income (loss), net of tax | ||||
Other comprehensive income (loss) | (78) | 20 | ||
Ending balance | $ 20 | $ 20 |
CASH, CASH EQUIVALENTS, AND M_3
CASH, CASH EQUIVALENTS, AND MARKETABLE SECURITIES (Details Narrative) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Cash and Cash Equivalents [Abstract] | ||
Cash and Cash Equivalents, at Carrying Value | $ 118,439 | $ 39,165 |
Available-for-sale Securities and Held-to-maturity Securities | $ 28,700 | $ 46,200 |
LICENSE AND OTHER AGREEMENTS (D
LICENSE AND OTHER AGREEMENTS (Details Narrative) - USD ($) $ / shares in Units, $ in Millions | 1 Months Ended | 9 Months Ended | ||||
Sep. 30, 2019 | Jul. 31, 2019 | Nov. 30, 2018 | May 31, 2018 | Apr. 30, 2017 | Sep. 30, 2020 | |
Entity Listings [Line Items] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Exercised | 316,754 | |||||
Sale of Stock, Number of Shares Issued in Transaction | 5,750,000 | |||||
Sale of Stock, Price Per Share | $ 8 | |||||
MacroGenics Asset Purchase Agreement and MacroGenics License Agreement [Member] | ||||||
Entity Listings [Line Items] | ||||||
Fair Value per share of each warrant | $ 1.64 | |||||
Warrants issued during period, fair value | $ 4 | |||||
Intravacc Development Services Agreement [Member] | ||||||
Entity Listings [Line Items] | ||||||
Payments made for develpoment and manufacturing services | $ 10.5 | |||||
Intravacc Development Services Agreement [Member] | Euro [Member] | ||||||
Entity Listings [Line Items] | ||||||
Payments made for develpoment and manufacturing services | $ 9 | |||||
MacroGenics, Inc. [Member] | ||||||
Entity Listings [Line Items] | ||||||
Amount payable by the entity on achievement of various milestones | $ 225 | |||||
Number of elected warrants exercise on a cashless basis | 2,432,688 | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Exercised | 1,948,474 | |||||
MacroGenics, Inc. [Member] | Asset Purchase Agreement [Member] | ||||||
Entity Listings [Line Items] | ||||||
Class of Warrant or Right, Number of Securities Called by Each Warrant or Right | 2,162,389 | |||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 2.50 | |||||
Amount payable by the entity on achievement of various milestones | $ 170 | |||||
MacroGenics, Inc. [Member] | Asset Purchase Agreement [Member] | Maximum [Member] | ||||||
Entity Listings [Line Items] | ||||||
Amount payable by the entity on achievement of various milestones | 1.3 | |||||
MacroGenics, Inc. [Member] | Asset Purchase Agreement [Member] | Biologics License Application [Member] | ||||||
Entity Listings [Line Items] | ||||||
Amount payable by the entity on achievement of various milestones | $ 60 | |||||
MacroGenics, Inc. [Member] | License Agreement [Member] | ||||||
Entity Listings [Line Items] | ||||||
Class of Warrant or Right, Number of Securities Called by Each Warrant or Right | 270,299 | |||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 2.50 | |||||
Amount payable by the entity on achievement of various milestones | $ 225 | |||||
MacroGenics, Inc. [Member] | License Agreement [Member] | First Indication [Member] | ||||||
Entity Listings [Line Items] | ||||||
Amount payable by the entity on achievement of various milestones | 42.5 | |||||
MacroGenics, Inc. [Member] | License Agreement [Member] | Second Indication [Member] | ||||||
Entity Listings [Line Items] | ||||||
Amount payable by the entity on achievement of various milestones | $ 22.5 | |||||
Amgen Inc [Member] | ||||||
Entity Listings [Line Items] | ||||||
Amount payable by the entity on achievement of various milestones | $ 70 | |||||
Amgen Inc [Member] | Private Placement [Member] | ||||||
Entity Listings [Line Items] | ||||||
Sale of Stock, Number of Shares Issued in Transaction | 2,500,000 | |||||
Sale of Stock, Price Per Share | $ 8 | |||||
Proceeds from Issuance of Private Placement | $ 20 | |||||
Amgen Inc [Member] | License And Collaboration Agreement [Member] | ||||||
Entity Listings [Line Items] | ||||||
Potential proceeds from investment by collaborator | 20 | |||||
Amount payable by the entity on achievement of various milestones | $ 150 | |||||
Vactech [Member] | License Agreement [Member] | ||||||
Entity Listings [Line Items] | ||||||
Amount payable by the entity on achievement of various milestones | $ 24.5 | |||||
Shares Issued, Price Per Share | $ 1.70 | |||||
Payments made on tiered single-digit royalties | $ 19 | |||||
Vactech [Member] | License Agreement [Member] | Research and Development Expense [Member] | ||||||
Entity Listings [Line Items] | ||||||
Warrants issued during period, fair value | 3.4 | |||||
Vactech [Member] | License Agreement [Member] | First 18 Months [Member] | ||||||
Entity Listings [Line Items] | ||||||
Payments made for develpoment and manufacturing services | 0.5 | |||||
Janssen Pharmaceutica NV [Member] | License, Development and Commercialization Agreement [Member] | ||||||
Entity Listings [Line Items] | ||||||
Payments made on tiered single-digit royalties | 100 | |||||
Janssen Pharmaceutica NV [Member] | License, Development and Commercialization Agreement [Member] | First Indication [Member] | ||||||
Entity Listings [Line Items] | ||||||
Amount payable by the entity on achievement of various milestones | 35 | |||||
Janssen Pharmaceutica NV [Member] | License, Development and Commercialization Agreement [Member] | Second Indication [Member] | ||||||
Entity Listings [Line Items] | ||||||
Amount payable by the entity on achievement of various milestones | $ 20 |
SCHEDULE OF COMPUTATION OF BASI
SCHEDULE OF COMPUTATION OF BASIC AND DILUTED LOSS PER SHARE (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Earnings Per Share [Abstract] | ||||
Net loss | $ (31,301) | $ (9,769) | $ (66,005) | $ (32,745) |
Weighted average shares of common stock outstanding - basic and diluted | 56,339 | 40,512 | 51,098 | 38,424 |
Net loss per common share, basic and diluted | $ (0.56) | $ (0.24) | $ (1.29) | $ (0.85) |
SCHEDULE OF ANTIDILUTIVE SECURI
SCHEDULE OF ANTIDILUTIVE SECURITIES EXCLUDED FROM COMPUTATION OF EARNINGS PER SHARE (Details) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Stock Options [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per share | 9,452 | 5,934 | 9,452 | 5,934 |
Warrants [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per share | 1,705 | 2,125 | 1,705 | 2,125 |
SCHEDULE OF ACCRUED EXPENSES (D
SCHEDULE OF ACCRUED EXPENSES (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Payables and Accruals [Abstract] | ||
Accrued research and development costs | $ 5,725 | $ 1,700 |
Accrued pre-commercial costs | 1,604 | |
Accrued compensation | 1,235 | 54 |
Accrued professional fees | 637 | 221 |
Other accrued liabilities | 98 | 90 |
Total accrued expenses | $ 9,299 | $ 2,065 |
SCHEDULE OF ASSETS AND LIABILIT
SCHEDULE OF ASSETS AND LIABILITIES MEASURED AT FAIR VALUE ON RECURRING BASIS (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 | |
Cash and Cash Equivalents [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Fair value of assets | [1] | $ 118,439 | $ 39,165 |
Investments in U.S. Treasury Securities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Fair value of assets | [2] | 13,139 | 46,208 |
Investments in Corporate Debt Securities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Fair value of assets | [2] | 15,580 | |
Fair Value, Inputs, Level 1 [Member] | Cash and Cash Equivalents [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Fair value of assets | [1] | 118,439 | 39,165 |
Fair Value, Inputs, Level 1 [Member] | Investments in U.S. Treasury Securities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Fair value of assets | [2] | 13,139 | 46,208 |
Fair Value, Inputs, Level 1 [Member] | Investments in Corporate Debt Securities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Fair value of assets | [2] | ||
Fair Value, Inputs, Level 2 [Member] | Cash and Cash Equivalents [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Fair value of assets | [1] | ||
Fair Value, Inputs, Level 2 [Member] | Investments in U.S. Treasury Securities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Fair value of assets | [2] | ||
Fair Value, Inputs, Level 2 [Member] | Investments in Corporate Debt Securities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Fair value of assets | [2] | 15,580 | |
Fair Value, Inputs, Level 3 [Member] | Cash and Cash Equivalents [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Fair value of assets | [1] | ||
Fair Value, Inputs, Level 3 [Member] | Investments in U.S. Treasury Securities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Fair value of assets | [2] | ||
Fair Value, Inputs, Level 3 [Member] | Investments in Corporate Debt Securities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Fair value of assets | [2] | ||
[1] | Cash and cash equivalents primarily include investments in money market funds and U.S. Treasury securities with maturity dates within 90 days from the purchase date | ||
[2] | Investments in U.S. Treasury and investment-grade corporate debt securities are classified as available for sale securities |
SCHEDULE OF STOCK-BASED COMPENS
SCHEDULE OF STOCK-BASED COMPENSATION EXPENSE (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Total stock-based compensation expense | $ 2,715 | $ 923 | $ 5,228 | $ 1,628 |
General and Administrative Expense [Member] | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Total stock-based compensation expense | 1,841 | 545 | 3,402 | 874 |
Research and Development Expense [Member] | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Total stock-based compensation expense | $ 874 | $ 378 | $ 1,826 | $ 754 |
SUMMARY OF STOCK OPTION ACTIVIT
SUMMARY OF STOCK OPTION ACTIVITY (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Dec. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | ||
Stock Options Underlying Shares, Outstanding beginning | 5,894 | |
Weighted-Average Exercise Price, Outstanding beginning balance | $ 6.33 | |
Weighted-Average Remaining Contractual Term, Outstanding Ending | 8 years 7 months 6 days | 8 years 6 months |
Intrinsic Value, Outstanding Beginning | ||
Stock Options Underlying Shares, Granted | 3,871 | |
Weighted-Average Exercise Price, Granted | $ 12.74 | |
Stock Options Underlying Shares, Exercised | (189) | |
Weighted-Average Exercise Price, Exercised | $ 4.57 | |
Stock Options Underlying Shares, Forfeited or expired | (124) | |
Weighted-Average Exercise Price, Forfeited or expired | $ 5.23 | |
Stock Options Underlying Shares, Outstanding ending balance | 9,452 | 5,894 |
Weighted-Average Exercise Price, Outstanding ending balance | $ 9 | $ 6.33 |
Intrinsic Value, Outstanding Ending | $ 38,231 | |
Stock Options Underlying Shares, Exercisable | 2,776 | |
Weighted-Average Exercise Price, Exercisable | $ 4.31 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Weighted Average Remaining Contractual Term | 7 years 3 months 18 days | |
Intrinsic Value, Exercisable | $ 23,816 |
SCHEDULE OF AGGREGATED INTRINSI
SCHEDULE OF AGGREGATED INTRINSIC VALUE OF STOCK OPTION EXERCISED (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Share-based Payment Arrangement [Abstract] | ||||
Cash proceeds from options exercised | $ 287 | $ 198 | $ 861 | $ 219 |
Aggregate intrinsic value of options exercised | $ 526 | $ 292 | $ 1,480 | $ 373 |
SCHEDULE OF SHARE-BASED COMPENS
SCHEDULE OF SHARE-BASED COMPENSATION VALUATION OF ASSUMPTIONS (Details) - $ / shares | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Share-based Payment Arrangement [Abstract] | ||
Exercise price | $ 12.74 | $ 10.34 |
Expected volatility | 74.00% | 72.00% |
Expected dividends | 0.00% | 0.00% |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Term | 6 years 2 months 12 days | 6 years 3 months 18 days |
Risk-free interest rate | 0.59% | 1.91% |
STOCK OPTIONS (Details Narrativ
STOCK OPTIONS (Details Narrative) - USD ($) $ / shares in Units, $ in Millions | 9 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2019 | Jan. 02, 2020 | Dec. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number | 9,452,000 | 5,894,000 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Weighted Average Remaining Contractual Term | 7 years 3 months 18 days | |||
Annual dividend percentage | 0.00% | 0.00% | ||
Share-based Payment Arrangement, Option [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value | $ 8.24 | |||
Stock Option One [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Number of Shares | 2,720,000 | |||
Share-based Payment Arrangement, Nonvested Award, Option, Cost Not yet Recognized, Amount | $ 20 | |||
Stock Option Two [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Number of Shares | 3,956,000 | |||
Share-based Payment Arrangement, Nonvested Award, Option, Cost Not yet Recognized, Amount | $ 25.3 | |||
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Period for Recognition | 3 years 4 months 24 days | |||
2017 Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number | 9,452,394 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Weighted Average Remaining Contractual Term | 10 years | |||
Number of shares, description | the number of shares available for issuance under the 2017 Plan in an amount equal to (1) the difference between (x) 18% of the total shares of the Company’s common stock outstanding, on a fully diluted basis, on December 31st of the preceding calendar year, and (y) the total number of shares of the Company’s common stock reserved under the 2017 Plan on December 31st of such preceding calendar year or (2) an amount less than this calculated increase as determined by the board of directors. | |||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant | 190,333 | |||
2017 Plan [Member] | Maximum [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant | 3,000,000 |
WARRANTS (Details Narrative)
WARRANTS (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | Sep. 30, 2020 | Apr. 30, 2017 | Sep. 30, 2020 | Sep. 30, 2020 | Jul. 31, 2018 |
Schedule of Capitalization, Equity [Line Items] | |||||
Warrant term, description | These warrants have a five-year term | ||||
Number of warrants issuance shares | |||||
Number of warrrant shares exercised | 316,754 | ||||
Series A Offering [Member] | |||||
Schedule of Capitalization, Equity [Line Items] | |||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 312,689 | 312,689 | 312,689 | ||
Number of warrants issuance shares | 129,822 | 259,542 | |||
Warrants and Rights Outstanding | $ 241,986 | $ 241,986 | $ 241,986 | ||
Series A Offering [Member] | Quarterly Period [Member] | |||||
Schedule of Capitalization, Equity [Line Items] | |||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 159,689 | 159,689 | 159,689 | ||
IPO [Member] | MDB Capital Group, LLC [Member] | |||||
Schedule of Capitalization, Equity [Line Items] | |||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 1,596,956 | ||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 5 | ||||
IPO [Member] | Warrant [Member] | |||||
Schedule of Capitalization, Equity [Line Items] | |||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 558,740 | ||||
Warrants and Rights Outstanding | $ 1,462,842 | $ 1,462,842 | $ 1,462,842 | ||
IPO [Member] | Warrant [Member] | Cashless Basis [Member] | |||||
Schedule of Capitalization, Equity [Line Items] | |||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 107,051 | 107,051 | 107,051 | ||
Number of warrants issuance shares | 66,316 | ||||
Number of warrrant shares exercised | 134,114 | ||||
Number of warrants issuance shares | 66,316 | ||||
Series A Convertible Redeemable Preferred Stock [Member] | Placement Agent [Member] | |||||
Schedule of Capitalization, Equity [Line Items] | |||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 558,740 | ||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 2.50 | ||||
Warrant term, description | seven-year term |
INCOME TAXES (Details Narrative
INCOME TAXES (Details Narrative) $ in Millions | 9 Months Ended |
Sep. 30, 2020USD ($) | |
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | |
Current State and Local Tax Expense (Benefit) | $ 0.5 |
NEW JERSEY | New Jersey's Technology Business Tax Certificate Transfer Program [Member] | |
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | |
Operating Loss Carryforwards | 6.8 |
Proceeds from Income Tax Refunds | $ 0.5 |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) - shares | Oct. 29, 2020 | Sep. 30, 2020 |
Subsequent Event [Line Items] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 3,871,000 | |
Subsequent Event [Member] | ||
Subsequent Event [Line Items] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 2,000,000 |