Document and Entity Information
Document and Entity Information | 12 Months Ended |
Dec. 31, 2019shares | |
Entity Registrant Name | Aptorum Group Ltd |
Entity Central Index Key | 0001734005 |
Amendment Flag | false |
Current Fiscal Year End Date | --12-31 |
Document Type | 20-F |
Document Period End Date | Dec. 31, 2019 |
Document Fiscal Period Focus | FY |
Document Fiscal Year Focus | 2019 |
Entity a Well-known Seasoned Issuer | No |
Entity Voluntary Filers | No |
Entity Current Reporting Status | Yes |
Entity Filer Category | Non-accelerated Filer |
Entity Emerging Growth Company | true |
Entity Ex Transition Period | false |
Entity Shell Company | false |
Document Annual Report | true |
Document Transition Report | false |
Document Shell Company Report | false |
Entity Interactive Data Current | Yes |
Entity Incorporation State Country Code | E9 |
Class A Ordinary Shares | |
Entity Common Stock, Shares Outstanding | 6,597,362 |
Class B Ordinary Shares | |
Entity Common Stock, Shares Outstanding | 22,437,754 |
Consolidated Balance Sheets (Su
Consolidated Balance Sheets (Successor Basis) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash | $ 5,189,003 | $ 12,006,624 |
Restricted cash | 104,170 | 14,100,614 |
Digital currencies | 1,539 | |
Accounts receivable | 40,543 | 2,827 |
Inventories | 34,185 | 30,642 |
Marketable securities, at fair value | 1,063,111 | 1,014,338 |
Investments in derivatives | 203,320 | 115,721 |
Amounts due from related parties | 962 | 169,051 |
Due from brokers | 317,005 | 818,968 |
Other receivables and prepayments | 1,079,043 | 464,156 |
Total current assets | 8,032,881 | 28,722,941 |
Property, plant and equipment, net | 7,093,035 | 4,260,602 |
Non-marketable investments | 7,112,180 | 7,094,712 |
Intangible assets, net | 1,311,683 | 1,409,540 |
Amounts due from related parties | 50,000 | 50,000 |
Long-term deposits | 294,606 | 3,417,178 |
Other non-current asset | 59,833 | 119,667 |
Total Assets | 23,954,218 | 45,074,640 |
Current liabilities: | ||
Amounts due to related parties | 41,593 | 33,417 |
Accounts payable and accrued expenses | 2,586,527 | 1,247,147 |
Finance lease payable, current portion | 46,555 | 43,877 |
Warrant liabilities | 753,118 | |
Convertible debts | 10,107,306 | |
Total current liabilities | 2,674,675 | 12,184,865 |
Finance lease payable, non-current portion | 97,319 | 143,873 |
Loan payables to related parties | 6,330,472 | |
Total Liabilities | 9,102,466 | 12,328,738 |
Commitments and contingencies | ||
EQUITY | ||
Additional paid-in capital | 24,887,624 | 23,003,285 |
Accumulated other comprehensive loss | (5,552) | (1,484,688) |
Accumulated deficit | (37,555,980) | (17,379,185) |
Total equity attributable to the shareholders of Aptorum Group Limited | 16,361,208 | 33,114,435 |
Non-controlling interests | (1,509,456) | (368,533) |
Total equity | 14,851,752 | 32,745,902 |
Total Liabilities and Equity | 23,954,218 | 45,074,640 |
Class A Ordinary Shares | ||
EQUITY | ||
Common stock value | 6,597,362 | 6,537,269 |
Total equity | 6,597,362 | 6,537,269 |
Class B Ordinary Shares | ||
EQUITY | ||
Common stock value | 22,437,754 | 22,437,754 |
Total equity | $ 22,437,754 | $ 22,437,754 |
Consolidated Balance Sheets (_2
Consolidated Balance Sheets (Successor Basis) (Parenthetical) - $ / shares | Dec. 31, 2019 | Dec. 31, 2018 |
Class A Ordinary Shares | ||
Common stock, par value | $ 1 | $ 1 |
Common stock, shares authorized | 60,000,000 | 60,000,000 |
Common stock, shares issued | 6,597,362 | 6,537,269 |
Common stock, shares outstanding | 6,597,362 | 6,537,269 |
Class B Ordinary Shares | ||
Common stock, par value | $ 1 | $ 1 |
Common stock, shares authorized | 40,000,000 | 40,000,000 |
Common stock, shares issued | 22,437,754 | 22,437,754 |
Common stock, shares outstanding | 22,437,754 | 22,437,754 |
Consolidated Statements of Oper
Consolidated Statements of Operations and Comprehensive Loss (Successor Basis) - USD ($) | 10 Months Ended | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | |
Revenue | |||
Healthcare service income | $ 535,166 | $ 383,450 | |
Operating expenses | |||
Cost of healthcare service | (794,545) | (318,011) | |
Research and development expenses | (2,560,323) | (6,939,051) | (3,101,432) |
General and administrative fees | (1,480,093) | (7,373,425) | (4,919,626) |
Legal and professional fees | (1,395,490) | (3,405,705) | (1,811,770) |
Other operating expenses | (257,177) | (220,891) | (560,709) |
Total expenses | (5,693,083) | (18,733,617) | (10,711,548) |
Other (loss) income | |||
(Loss) gain on investments in marketable securities, net | 3,912,500 | (81,839) | 501,522 |
Gain on non-marketable investments | 1,147,190 | ||
Gain (loss) on investments in derivatives, net | (827,501) | 87,599 | (974,444) |
Gain on use of digital currencies | 46,717 | ||
Gain on extinguishment of convertible debts | 1,198,490 | ||
Changes in fair value of warrant liabilities | (866,300) | 124,726 | |
Interest (expense) income, net | 44,269 | (3,699,672) | (4,458,191) |
Rental income | 16,868 | ||
Dividend income | 2,308 | ||
Sundry income | 232,460 | ||
Total other (loss) income, net | 3,131,576 | (1,918,487) | (4,806,387) |
Net loss | (2,561,507) | (20,116,938) | (15,134,485) |
Less: net loss attributable to non-controlling interests | (14,045) | (1,430,176) | (302,762) |
Net loss attributable to Aptorum Group Limited | $ (2,547,462) | $ (18,686,762) | $ (14,831,723) |
Net loss per share - basic and diluted | $ (0.09) | $ (0.64) | $ (0.53) |
Weighted-average shares outstanding - basic and diluted | 26,963,435 | 29,008,445 | 27,909,788 |
Net loss | $ (2,561,507) | $ (20,116,938) | $ (15,134,485) |
Other Comprehensive loss | |||
Unrealized loss on investments in available-for-sale securities | (367,782) | (1,122,251) | |
Exchange differences on translation of foreign operations | (10,897) | 5,345 | |
Other Comprehensive loss | (367,782) | (10,897) | (1,116,906) |
Comprehensive loss | (2,929,289) | (20,127,835) | (16,251,391) |
Less: comprehensive loss attributable to non-controlling interests | (14,045) | (1,430,176) | (302,762) |
Comprehensive loss attributable to the shareholders of Aptorum Group Limited | $ (2,915,244) | $ (18,697,659) | $ (15,948,629) |
Statement of Operations (Predec
Statement of Operations (Predecessor Basis) | 2 Months Ended |
Feb. 28, 2017USD ($) | |
Investment income | |
Dividend income from unaffiliated issuers | |
Interest income | 3,011 |
Total investment income | 3,011 |
Expenses | |
General and administrative fees | 17,516 |
Management fees | 108,958 |
Legal and professional fees | 98,646 |
Other operating expenses | 1,907 |
Total expenses | 227,027 |
Net investment loss | (224,016) |
Realized and unrealized losses | |
Net realized losses on investments in unaffiliated issuers | (15,327) |
Aptorum Therapeutics - related party | (98,434) |
Unaffiliated issuers | (288,307) |
Net realized and unrealized losses | (402,068) |
Net decrease in net assets resulting from operations | $ (626,084) |
Consolidated Statements of Equi
Consolidated Statements of Equity (Successor Basis) - USD ($) | Ordinary shares | Class A Ordinary Shares | Class B Ordinary Shares | Additional Paid-in Capital | Accumulated deficit | Accumulated other comprehensive loss | Non-controlling interests | Total |
Balance at Feb. 28, 2017 | $ 25,657,110 | $ (1,168,448) | $ 24,488,662 | |||||
Balance, Shares at Feb. 28, 2017 | 25,657,110 | |||||||
Proceeds from issuance of shares | $ 2,207,025 | 6,394,976 | 8,602,001 | |||||
Proceeds from issuance of shares, shares | 2,207,025 | |||||||
Converted from ordinary shares | $ (27,864,135) | $ 5,426,381 | $ 22,437,754 | |||||
Converted from ordinary shares, shares | (27,864,135) | 5,426,381 | 22,437,754 | |||||
Unrealized loss on investments in available-for-sale securities | $ (367,782) | (367,782) | ||||||
Gain on disposal of entity under common control | 67,874 | 67,874 | ||||||
Net loss | $ (2,547,462) | $ (14,045) | (2,561,507) | |||||
Balance at Dec. 31, 2017 | $ 5,426,381 | $ 22,437,754 | 5,294,402 | (2,547,462) | (367,782) | (14,045) | 30,229,248 | |
Balance, Shares at Dec. 31, 2017 | 5,426,381 | 22,437,754 | ||||||
Issuance of initial public offering of ordinary shares on December 17, 2018 at $15.8 per share, net of underwriting discount and offering expenses | $ 761,419 | 9,536,631 | 10,298,050 | |||||
Issuance of initial public offering of ordinary shares on December 17, 2018 at $15.8 per share, net of underwriting discount and offering expenses, shares | 761,419 | |||||||
Proceeds from non-controlling interest | 51,727 | (51,726) | 1 | |||||
Converted from convertible debts | $ 349,469 | 2,683,839 | 3,033,308 | |||||
Converted from convertible debts, shares | 349,469 | |||||||
Unrealized loss on investments in available-for-sale securities | (1,122,251) | (1,122,251) | ||||||
Beneficial conversion feature | 5,436,686 | 5,436,686 | ||||||
Exchange difference on translation of foreign operation | 5,345 | 5,345 | ||||||
Net loss | (14,831,723) | (302,762) | (15,134,485) | |||||
Balance at Dec. 31, 2018 | $ 6,537,269 | $ 22,437,754 | 23,003,285 | (17,379,185) | (1,484,688) | (368,533) | 32,745,902 | |
Balance, Shares at Dec. 31, 2018 | 6,537,269 | 22,437,754 | ||||||
Adjustment to opening balance of equity | (1,490,033) | 1,490,033 | ||||||
Balance, January 1, 2019 | $ 6,537,269 | $ 22,437,754 | 23,003,285 | (18,869,218) | 5,345 | (368,533) | 32,745,902 | |
Balance, January 1, 2019, share | 6,537,269 | 22,437,754 | ||||||
Issuance of shares to non-controlling interest | 10,672 | (10,672) | ||||||
Issuance of tokens | 300,000 | 300,000 | ||||||
Reacquisition of convertible bonds | (1,298,490) | (1,298,490) | ||||||
Disposal of a subsidiary | (75) | (75) | ||||||
Share-based compensation | 1,612,832 | 1,612,832 | ||||||
Exercise of warrants | 60,093 | 1,559,325 | 1,619,418 | |||||
Exercise of warrants, shares | 60,093 | |||||||
Exchange difference on translation of foreign operation | (10,897) | (10,897) | ||||||
Net loss | (18,686,762) | (1,430,176) | (20,116,938) | |||||
Balance at Dec. 31, 2019 | $ 6,597,362 | $ 22,437,754 | $ 24,887,624 | $ (37,555,980) | $ (5,552) | $ (1,509,456) | $ 14,851,752 | |
Balance, Shares at Dec. 31, 2019 | 6,597,362 | 22,437,754 |
Consolidated Statements of Eq_2
Consolidated Statements of Equity (Successor Basis) (Parenthetical) | Dec. 17, 2018$ / shares |
Statement of Stockholders' Equity [Abstract] | |
Initial public offering of ordinary shares | $ 15.8 |
Statement of Changes in Net Ass
Statement of Changes in Net Assets (Predecessor Basis) | 2 Months Ended |
Feb. 28, 2017USD ($) | |
Operations | |
Net investment losses | $ (224,016) |
Net realized losses | (15,327) |
Net change in unrealized depreciation | (386,741) |
Net decrease in net assets resulting from operations | (626,084) |
Distributions to shareholders | |
Equalization payable | 9,663 |
Return of capital | (9,663) |
Total distributions | |
Total decrease in net assets | (626,084) |
Net assets | |
Beginning of period | 25,114,746 |
End of period | $ 24,488,662 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Successor Basis) - USD ($) | 10 Months Ended | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | |
Cash flows from operating activities | |||
Net loss | $ (2,561,507) | $ (20,116,938) | $ (15,134,485) |
Adjustments to reconcile net loss to net cash used in operating activities | |||
Amortization and depreciation | 58,903 | 1,299,618 | 682,292 |
Share-based compensation | 1,612,832 | ||
Loss (gain) on investments in marketable securities, net | (3,912,500) | 81,839 | (501,522) |
Gain on non-marketable investments | (1,147,190) | ||
(Gain) loss on investments in derivatives, net | 827,501 | (87,599) | 974,444 |
Changes in fair value of warrant liabilities | 866,300 | (124,726) | |
Gain on use of digital currencies | (46,717) | ||
Settlement of service fee by digital currencies and tokens | 437,178 | ||
Gain on extinguishment of convertible debts | (1,198,490) | ||
Interest income | (79,558) | (108,512) | |
Interest expense and accretion of convertible debts | 3,769,263 | 4,559,714 | |
Accretion of finance lease obligation | 9,967 | 6,989 | |
Changes in operating assets and liabilities | |||
Accounts receivable | (37,716) | (2,827) | |
Inventories | (3,543) | (30,642) | |
Other receivables and prepayments | (303,925) | (427,541) | (45,911) |
Other non-current asset | (179,500) | ||
Long-term deposits | (20,092) | 55,429 | (111,951) |
Due from brokers | (54,158) | 501,963 | 751 |
Amounts due from related parties | 168,089 | (79,204) | |
Amounts due to related parties | (26,060) | 1,004 | |
Accounts payable and accrued expenses | 183,083 | 986,241 | 58,555 |
Net cash used in operating activities | (5,782,695) | (13,382,633) | (10,035,531) |
Cash flows from investing activities | |||
Purchase of digital currencies | (200,000) | ||
Advances to related parties | (186,898) | ||
Purchases of intangible assets | (968,730) | (70,109) | (417,794) |
Purchases of property, plant and equipment | (2,090,721) | (837,062) | (5,646,505) |
Proceeds from sales of investment securities | 16,049,067 | 999,110 | 2,312 |
Disbursement of a loan to a third party | (1,400,000) | (3,000,000) | |
Repayment of a loan from a third party | 1,400,000 | 3,000,000 | |
Net cash (used in) provided by investing activities | 12,802,718 | (108,061) | (6,061,987) |
Cash flows from financing activities | |||
Loan from related parties | 6,330,472 | ||
Payment for settlement of convertible debts | (13,600,000) | ||
Proceeds from issuance of convertible debts | 480,000 | 16,120,400 | |
Proceeds from issuance of shares | 8,602,001 | 11,054,319 | |
Payments of initial public offering costs | (538,122) | ||
Payments for debt issuance costs | (1,099,316) | ||
Payment of finance lease obligations | (53,843) | (58,332) | |
Net cash (used in) provided by financing activities | 9,082,001 | (7,323,371) | 25,478,949 |
Net (decrease) increase in cash and restricted cash | 16,102,024 | (20,814,065) | 9,381,431 |
Cash and restricted cash – Beginning of period | 623,783 | 26,107,238 | 16,725,807 |
Cash and restricted cash – End of period | 16,725,807 | 5,293,173 | 26,107,238 |
Supplemental disclosures of cash flow information | |||
Interest paid | 557,333 | 606,989 | |
Income taxes paid | |||
Proceeds in broker accounts | 999,110 | 640,227 | |
Non-cash operating, investing and financing activities | |||
Issuance of token in exchange of services | 300,000 | ||
Net settlement of related party balances | 164,973 | ||
Equipment acquired through finance lease | 239,093 | ||
Conversion of convertible debts | 3,033,308 | ||
Settlement of service fee by digital currencies and tokens | 437,178 | ||
Reconciliation of cash and restricted cash | |||
Cash | 16,245,807 | 5,189,003 | 12,006,624 |
Restricted cash | 480,000 | 104,170 | 14,100,614 |
Total cash and restricted cash shown in the consolidated statements of cash flows | $ 16,725,807 | $ 5,293,173 | $ 26,107,238 |
Statement of Cash Flows (Predec
Statement of Cash Flows (Predecessor Basis) | 2 Months Ended |
Feb. 28, 2017USD ($) | |
Cash flows from operating activities | |
Net decrease in net assets resulting from operations | $ (626,084) |
Adjustments to reconcile net decrease in net assets resulting from operations to net cash used in operating activities: | |
Net change in unrealized depreciation on investments | 386,741 |
Net realized loss on sales of investments in unaffiliated issuers | 15,327 |
Proceeds from sales of investment securities | 28,425 |
Increase in interest receivable | (5,099) |
Increase in due from brokers | (28,438) |
Decrease in other receivable and prepayments | 2,520 |
Increase in accounts payable and accrued expenses | 13,778 |
Decrease in management fees payable - related party | (58,830) |
Net cash used in operating activities | (271,660) |
Net decrease in cash | (271,660) |
Cash - Beginning of period | 301,643 |
Cash - End of period | 29,983 |
Supplemental disclosures of cash flow information | |
Interest paid | |
Income taxes paid |
Organization
Organization | 12 Months Ended |
Dec. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION | 1. ORGANIZATION The consolidated financial statements include the financial statements the Aptorum Group Limited (the "Company") and its subsidiaries. The Company and its subsidiaries are hereinafter collectively referred to as the "Group". The Company, formerly known as APTUS Holdings Limited and STRIKER ASIA OPPORTUNITIES FUND CORPORATION, is a company incorporated on September 13, 2010 under the laws of the Cayman Islands with limited liability. On March 1, 2017, the Company changed from an investment fund with management shares and non-voting participating redeemable preference shares to a holding company with operating subsidiaries. After that, the Company has become a biopharmaceutical company. The Company researches and develops life science and biopharmaceutical products within its wholly-owned subsidiary, Aptorum Therapeutics Limited, formerly known as APTUS Therapeutics Limited ("Aptorum Therapeutics") and its indirect subsidiary companies (collectively, "Aptorum Therapeutics Group"). Below summarizes the list of the major subsidiaries consolidated as of December 31, 2019: Name Incorporation Ownership Place of Principle activities Aptorum Therapeutics Limited June 30, 2016 100% Cayman Islands Research and development of life science and biopharmaceutical products APTUS MANAGEMENT LIMITED May 16, 2017 100% Hong Kong Provision of management services to its holding company and fellow subsidiaries Aptorum Medical Limited August 28, 2017 94% Cayman Islands Provision of medical clinic services Aptus Therapeutics (Hong Kong) Limited June 30, 2016 100% Hong Kong Research and development of life science and biopharmaceutical products Aptorum Pharmaceutical Development Limited August 28, 2017 100% Cayman Islands Research and development of life science and biopharmaceutical products Aptorum Innovations Holding Limited April 15, 2019 100% Cayman Islands Investment holding company Aptorum Innovations Holding Pte. Ltd. June 5, 2019 100% Singapore Research and development of life science and biopharmaceutical products Aptorum Investment Holding Limited March 29, 2019 100% Cayman Islands Investment holding company Acticule Life Sciences Limited June 30, 2017 80% Cayman Islands Research and development of life science and biopharmaceutical products Claves Life Sciences Limited August 2, 2017 100% Cayman Islands Research and development of life science and biopharmaceutical products Nativus Life Sciences Limited July 7, 2017 100% Cayman Islands Research and development of life science and biopharmaceutical products Videns Incorporation Limited March 2, 2017 100% Cayman Islands Research and development of life science and biopharmaceutical products mTOR (Hong Kong) Limited November 4, 2016 90% Hong Kong Research and development of life science and biopharmaceutical products Scipio Life Sciences Limited July 19, 2017 100% Cayman Islands Research and development of life science and biopharmaceutical products Signate Life Sciences Limited August 28, 2017 100% Cayman Islands Research and development of life science and biopharmaceutical products SMTPH Limited April 18, 2019 100% Seychelles Investment holding company Smart Pharmaceutical Research Limited April 24, 2019 100% Samoa Pharmaceutical research and analysis Smart Pharmaceutical Development Pte. Limited May 10, 2019 100% Singapore Research and development of life science and biopharmaceutical products Smart Pharmaceutical Limited Partnership June 7, 2019 100% Seychelles Issuance of asset backed securities Initial public offering On December 17, 2018, the Group completed an initial public offering (the "IPO" or "Offering") with new issuance of 761,419 ordinary shares at $15.80 for total offering size of approximately $12.0 million before deducting commissions and expenses. The net proceeds from the IPO was approximately $10.3 million, net off underwriting discount of approximately $1.2 million and offering costs of approximately $0.5 million. After the IPO, the ordinary shares began trading on the NASDAQ Global Market under the ticker symbol "APM". Deferred offering costs Deferred offering costs consist principally of legal, printing and registration costs in connection with the Group's IPO. Such costs are deferred until the closing of the Offering, at which time the deferred costs are offset against the offering proceeds. Deferred offering costs as of December 31, 2019 and 2018 amounted to $nil on the consolidated balance sheets. At the completion of the IPO, $1,732,229 offering costs was charged to additional paid-in capital. |
Liquidity
Liquidity | 12 Months Ended |
Dec. 31, 2019 | |
Private Placing Memorandum [Abstarct] | |
LIQUIDITY | 2. LIQUIDITY The Company reported a net loss of $20,116,938, net operating cash outflow of $13,382,633 and working capital of $5,358,206 for the year ended December 31, 2019. In addition, the Company had an accumulated deficit of $37,555,980 as of December 31, 2019. The Company's operating results for future periods are subject to numerous uncertainties and it is uncertain if the Company will be able to reduce or eliminate its net losses for the foreseeable future. If management is not able to generate significant revenues from its product candidates currently in development, the Company may not be able to achieve profitability. The Company's principal sources of liquidity have been cash, marketable securities and line of credit facility from related parties. As of the date of issuance of the consolidated financial statements, the Company has approximately $6.3 million of restricted and unrestricted cash and undrawn line of credit facility from related parties of approximately $12.4 million. Based upon the current market price of the Company's marketable securities, it anticipates it can liquidate such marketable securities, if necessary. In addition, the Company will need to maintain its operating costs at a level which will not exceed such aforementioned sources of funds in order to continue as a going concern for a period within one year after the issuance of its consolidated financial statements. The Company believes that available cash, together with the efforts from aforementioned management plan and actions, should enable the Company to meet current anticipated cash needs for at least the next 12 months after the date that the financial statements are issued and the Company has prepared the consolidated financial statements on a going concern basis. However, the Company continues to have ongoing obligations and it expects that it will require additional capital in order to execute its longer-term development plan. If the Company encounters unforeseen circumstances that place constraints on its capital resources, management will be required to take various measures to conserve liquidity, which could include, but not necessarily be limited to, deferring some of its research, seeking to dispose of marketable securities and drawing down from line of credit provided by related parties. Management cannot provide any assurance that the Company will raise additional capital if needed. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Principles of presentation and consolidation The consolidated financial statements are prepared in accordance with U.S. GAAP. Before March 1, 2017, the Company was an investment company under U.S. GAAP for the purposes of financial reporting. U.S. GAAP for an investment company requires investments to be recorded at estimated fair value and the unrealized gains and/or losses in an investment's fair value are recognized on a current basis in the statements of operations. In addition, the Company did not consolidate its subsidiaries, since they were operating companies and not investment companies. Such entities were fair valued in accordance with ASC Topic 946 ("ASC 946") and ASC Topic 820 ("ASC 820"). As of March 1, 2017, after the change of business purpose, legal form and substantive activities, the Company's status changed to an operating company from an investment company since it no longer met the criteria to qualify as an investment company under the ASC 946. The Company discontinued applying the guidance in ASC 946 and began to account for the change in status prospectively by accounting for its investments in accordance with other U.S. GAAP topics. This change in status and the accounting policies affect the comparability of the financial statements. As such, for the period January 1, 2017 through February 28, 2017, statements of operations, changes in net assets, and cash flows have been presented on the predecessor basis of accounting as an investment company, and on the successor basis of accounting as an operating company since March 1, 2017. The consolidated balance sheets as of December 31, 2019 and 2018 have been presented on the successor basis. The consolidated financial statements of the Group are presented on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") and include the accounts of the Company, its direct and indirect wholly and majority owned subsidiaries. All material intercompany balances and transactions have been eliminated in preparation of the consolidated financial statements. Non-controlling interests Non-controlling interests represent the equity interests that are not attributable to the Group. Use of estimates The preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements as well as income and expenses during the reporting period. Significant accounting estimates reflected in the Group's consolidated financial statements include valuation of equity securities, fair value of investments in securities, convertible debts and finance lease, the useful lives of intangible assets and property, plant and equipment, impairment of long-lived assets, valuation allowance for deferred tax assets, and collectability of receivables. Actual results could differ from those estimates. Foreign currency translation and transaction USD is the reporting currency. The functional currency of subsidiaries in the Cayman Islands, Seychelles, Samoa and the United States are USD, the functional currency of subsidiaries in Hong Kong is Hong Kong Dollars ("HKD"), the functional currency of a subsidiary in Macao is Macanese Pataca ("MOP"), the functional currency of a subsidiary in the United Kingdom is Great British Pound ("GBP"), and the functional currency of subsidiaries in Singapore is Singapore Dollars ("SGD"). An entity's functional currency is the currency of the primary economic environment in which it operates, normally that is the currency of the environment in which it primarily generates and expends cash. The management considered various indicators, such as cash flows, market expenses, financing and inter-company transactions and arrangements in determining the Group's functional currency. In the consolidated financial statements, the financial information of the Company and its subsidiaries, which use HKD, MOP, GBP, and SGD as their functional currency, has been translated into USD. Assets and liabilities are translated from each subsidiary's functional currency at the exchange rates on the balance sheet dates, equity amounts are translated at historical exchange rates, and revenues, expenses, gains, and losses are translated using the average exchange rates for the year. Translation adjustments are reported as cumulative translation adjustments and are shown as a separate component of other comprehensive income or loss in the statements of operations and comprehensive loss. Cash Cash consists of cash on hand and bank deposits and cash denominated in foreign currencies, which is unrestricted as to withdraw and use. Restricted cash Restricted cash represented a time deposit pledged for banking facilities or cash deposited into the escrow account from investors for the purpose of the subscription of convertible debts. Digital currencies Digital currencies represented BitCoin, Ethereum, or other virtual currencies that the Group purchased and used to settle certain token related expenses. Digital currencies are included in current assets in the consolidated balance sheets. Digital currencies purchased are recorded at cost. Digital currencies held are accounted for as intangible assets with indefinite useful lives. An intangible asset with an indefinite useful life is not amortized but assessed for impairment annually, or more frequently, when events or changes in circumstances occur indicating that it is more likely than not that the indefinite-lived asset is impaired. Impairment exists when the carrying amount exceeds its fair value, which is measured using the quoted price of the digital currency at the time its fair value is being measured. In testing for impairment, the Group has the option to first perform a qualitative assessment to determine whether it is more likely than not that an impairment exists. If it is determined that it is not more likely than not that an impairment exists, a quantitative impairment test is not necessary. If the Company concludes otherwise, it is required to perform a quantitative impairment test. To the extent an impairment loss is recognized, the loss establishes the new cost basis of the asset. Subsequent reversal of impairment losses is not permitted. Purchases of digital currencies by the Group are included within investing activities in the consolidated statements of cash flows. The utilization of digital currencies in exchange of services are included within operating activities in the consolidated statements of cash flows and any gains or losses from such use are included in other income (expense) in the consolidated statements of operations. The Company accounts for its gains or losses in accordance with the first in first out (FIFO) method. Inventories Inventories are stated at lower of cost and net realizable value. Cost is determined using the weighted average method. Where there is evidence that the utility of inventories, in their disposal in the ordinary course of business, will be less than cost, whether due to physical deterioration, obsolescence, changes in price levels, or other causes, the inventories are written down to net realizable value. Accounts receivable Accounts receivable are stated at the original amount less an allowance for doubtful receivables, if any, based on a review of all outstanding amounts at period end. An allowance is also made when there is objective evidence that the Group will not be able to collect all amounts due according to the original terms of the receivables. The Group analyzes the aging of the customer accounts, historical and current economic trends and the age of the receivables when evaluating the adequacy of the allowance for doubtful accounts. Marketable securities Marketable securities are publicly traded stocks measured at fair value and classified within Level 1 and 2 in the fair value hierarchy because the Group uses quoted prices for identical assets in active markets or inputs that are based upon quoted prices for similar instruments in active markets. Loss on investments in marketable securities, net, amounted to $81,839, was recognized in the consolidated statements of operations for the year ended December 31, 2019. Gain on investments in marketable securities, net, amounted to $501,522 and $3,912,500, respectively, were recognized in the consolidated statements of operations for the year ended December 31, 2018 and the period March 1, 2017 through December 31, 2017. For the years ended December 31, 2019 and 2018, the Group disposed marketable securities, with sales proceeds of $999,110 and $637,582 received and recorded in due from brokers, respectively, and recognized a realized gain of $538,425 and $501,522 in the consolidated statements of operations, respectively. During the period March 1, 2017 to December 31, 2017, the Group disposed the trading securities and available-for-sale securities, with sales proceeds of $15,738,517 and $310,550 received, and recognized a gain of $3,917,046 and a loss of $4,546 on the consolidated statements of operations. Investments in derivatives Investments in derivatives consisted of warrants, which are measured at fair value, with gains or losses from changes in fair value recorded through earnings. The fair value of these warrants have been determined using the Black-Scholes pricing mode. The Black-Scholes pricing model provides for assumptions regarding volatility, call and put features and risk-free interest rates within the total period to maturity. No disposal was recorded during the year ended December 31, 2019 and the period March 1, 2017 through December 31, 2017. For the year ended December 31, 2018, the Group disposed of warrants with proceeds of $4,957 received. Unrealized gain on the investments in derivatives amounted to $87,599 was recognized in the consolidated statements of operations for the year ended December 31, 2019. Unrealized loss on the investments in derivatives amounted to $974,444 and $827,501, respectively, were recognized in the consolidated statements of operations for the year ended December 31, 2018 and the period March 1, 2017 to December 31, 2017. Non-marketable investments Non-marketable investments are comprising of investments in non-redeemable preferred shares of privately-held companies that are not required to be consolidated under the variable interest or voting models. Non-marketable investments are classified as non-current assets on the consolidated balance sheets as those investments do not have stated contractual maturity dates. The non-marketable equity securities not accounted for under the equity method are measured at cost, less any impairment, plus or minus changes resulting from observable price changes in orderly transactions for identical or similar investments of the same issuer. Adjustments are determined primarily based on a market approach as of the transaction date. Fair value measurement Fair value is defined as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required or permitted to be recorded at fair value, the Group considers the principal or most advantageous market in which it would transact its business, and it considers assumptions that market participants would use when pricing the asset or liability. As a basis for considering such assumptions, a three-tier fair value hierarchy prioritizes the inputs utilized in measuring fair value as follows: ● Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities. ● Level 2 applies to assets or liabilities for which there are inputs other than quoted prices included within Level 1 that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data. ● Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities. The hierarchy requires the Group to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument's categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The Group has estimated the fair value amounts of its financial instruments using the available market information and valuation methodologies considered to be appropriate and has determined that the carrying value of the Group's cash, restricted cash, accounts receivable, due from brokers, other receivables and prepayments, amounts due from/to related parties and accounts payable and accrued expenses as of December 31, 2019 and 2018 approximate fair value due to the short-term nature of these assets and liabilities. Property, plant and equipment Property, plant and equipment is stated at cost less accumulated depreciation and impairment losses. Cost represents the purchase price of the asset and other costs incurred to bring the asset into its existing use. Maintenance, repairs and betterments, including replacement of minor items, are charged to expense; major additions to physical properties are capitalized. Assets under construction are stated at cost less impairment losses. Cost comprises of cost of laboratory equipment delivered but not ready to be used, together with interest expense capitalized during the period of construction or installation and testing. Capitalization of these costs ceases and the asset concerned is transferred to the appropriate fixed assets category when substantially all the activities necessary to prepare the asset for its intended use are completed. Depreciation of property, plant and equipment is provided using the straight-line method over their estimated useful lives: Building 29 years Computer equipment 3 years Furniture, fixture, and office and medical equipment 5 years Leasehold improvements Shorter of the remaining lease terms or 5 years Laboratory equipment 5 years Motor vehicle 5 years Upon sale or disposal, the applicable amounts of asset cost and accumulated depreciation are removed from the accounts and the net amount less proceeds from disposal is charged or credited to income. Other non-current asset Other non-current asset represents laboratory supplies that can be used for more than one year. It is stated at cost less accumulated depreciation and impairment losses. Cost represents the purchase price of the supplies. Amortization of other non-current asset is provided using the straight-line method over their estimated useful lives. The amortization expenses for the years ended December 31, 2019 and 2018, and the period March 1, 2017 through December 31, 2017 are $59,834, $59,833 and $nil, respectively. Intangible assets Indefinite-lived intangible assets are tested for impairment at least annually and are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Indefinite-lived intangible assets are impaired if their estimated fair values are less than their carrying values. Finite-lived intangible assets are carried at cost less accumulated amortization and impairment if any. The finite intangible assets are amortized over their estimated useful life, which is the period over which the assets are expected to contribute directly or indirectly to the future cash flows of the Group. These intangible assets are tested for impairment at the time of a triggering event, if one were to occur. Finite-lived intangible assets may be impaired when the estimated undiscounted future cash flows generated from the assets are less than their carrying amounts. The Group's intangible assets mainly consist of computer software, exclusive rights in prepaid patented and unpatented licenses. The prepaid patented licenses are for clinical purpose or further development into other products. Prepaid unpatented license is for further development, once the associated research and development efforts are completed, the prepaid unpatented license will be reclassified as a finite-lived asset and is amortized over its useful life. The estimated useful life of the exclusive rights in using patents is generally the remaining patent life from the acquisition date to expiration date under the law, which is 17 to 20 years, the Group will reassess the remaining patent life on annual basis, and the Group will assess the intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may no longer be recoverable. Impairment of long-lived assets The Group reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may no longer be recoverable. When these events occur, the Group measures impairment by comparing the carrying value of the long-lived assets to the estimated undiscounted future cash flows expected to result from the use of the assets and their eventual disposition. If the sum of the expected undiscounted cash flow is less than the carrying amount of the assets, the Group would recognize an impairment loss, which is the excess of carrying amount over the fair value of the assets, using the expected future discounted cash flows. Convertible debts The Group determines the appropriate accounting treatment of its convertible debts in accordance with the terms in relation to the conversion feature, call and put option, beneficial conversion feature ("BCF") and settlement feature. After considering the impact of such features, the Group concluded that, the convertible debts contained a contingent beneficial conversion feature, which shall not be recognized in earnings until the contingency is resolved, and therefore accounted for such instrument as a liability in its entirety. Convertible debts were subsequently measured at amortized cost, using the effective interest rate method. Amortized cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the effective interest rate. The effective interest rate amortization is included in interest expense in the consolidated statements of operations. Management concluded that the contingency was effectively resolved upon the completion of the IPO on December 17, 2018 so that part of the convertible debts were converted automatically accordingly. The BCF derecognized upon automatic conversion was recorded as interest expense with a corresponding increase to additional paid-in capital. The remaining BCF was recorded as debt discount, which was amortized through the maturity of the convertible debts, with a corresponding increase to additional paid-in capital. On April 24, 2019, the Group repurchased its convertible debts at approximately $13.6 million with carrying amount of approximately $13.5 million and a gain on extinguishment on convertible debts of approximately $1.2 million was recognized. The repurchasing of convertible debts is considered an extinguishment and the difference between the repurchasing price of debt, the net carrying amount of the extinguished debt and the intrinsic value of BCF is recognized in the consolidated statements of operations. The intrinsic value of BCF of approximately $1.3 million at the extinguishment date was recorded as a reduction of additional paid-in capital. Finance lease Leases that transfer substantially all the rewards and risks of ownership of assets to the Group, other than legal title, are accounted for as finance leases. At the inception of a finance lease, the cost of the leased asset is capitalized at the present value of the minimum lease payments and recorded together with the obligation, excluding the interest element, to reflect the purchase and financing. Assets held under capitalized finance leases are included in property, plant and equipment, and depreciated over the shorter of the lease terms and the estimated useful lives of the assets. The interest expenses of such leases are charged to the consolidated statements of operations to provide a constant periodic rate of charge over the lease terms. Warrant liabilities For warrants that are not indexed to the Group's shares, the Group records the fair value of the issued warrants as liabilities at each balance sheet date and records changes in the estimated fair value as a non-cash gain or loss in the consolidated statements of operations and comprehensive loss. The warrant liabilities are recognized in the consolidated balance sheets at the fair value (level 3). The fair value of these warrants have been determined using the Black-Scholes pricing mode. The Black-Scholes pricing model provides for assumptions regarding volatility, call and put features and risk-free interest rates within the total period to maturity. Revenue recognition Revenue is recognized when (or as) the Company satisfies performance obligations by transferring a promised goods or services to a customer. Revenue is measured at the transaction price which is based on the amount of consideration that the Company expects to receive in exchange for transferring the promised goods or services to the customer. Contracts with customers are comprised of invoices and written contracts. Revenue from healthcare services is measured upon the provision of the relevant services. Cost of healthcare service Cost of healthcare service rendered represents cost in relation to the medical services provided including the compensation of the physicians and cost of pharmaceutical supplies and medicine. Research and development expenses Research and development costs are expensed as incurred. Research and development expenses are comprised of costs incurred in performing research and development activities, including amortization of the patent license, depreciation of laboratory equipment, external costs of outside vendors engaged to conduct preclinical development activities and trials. Income taxes The Group accounts for income taxes under the asset and liability method. Under this method, deferred income taxes are determined based on differences between the financial carrying amounts of existing assets and liabilities and their tax bases. Income taxes are provided for in accordance with the laws of the relevant taxing authorities. A valuation allowance is provided for deferred tax assets if it is more likely than not that these items will either expire before the Group is able to realize their benefits, or that future deductibility is uncertain. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. Uncertain tax positions The Group accounts for uncertainty in income taxes using a two-step approach to recognizing and measuring uncertain tax positions. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount that is more than 50% likely of being realized upon settlement. Interest and penalties related to uncertain tax positions are recognized and recorded as necessary in the provision for income taxes. The Group recognizes interest on non-payment of income taxes and penalties associated with tax positions when a tax position does not meet more likely than not thresholds be sustained under examination. The tax returns of the Group's Hong Kong subsidiaries are subject to examination by the relevant tax authorities. According to the Hong Kong Inland Revenue Department, the statute of limitation is six years if any company chargeable with tax has not been assessed or has been assessed at less than the proper amount, the statute of limitation is extended to ten years if the underpayment of taxes is due to fraud or willful evasion. According to United Kingdom, Singapore, the United States and Samoa tax rule, trading losses are available to be carried forward indefinitely. According to the Seychelles tax rule, net operating losses are available to be carried forward for 5 years. The Group did not have any material interest or penalties associated with tax positions for the years ended December 31, 2019 and 2018, and the period March 1, 2017 through December 31, 2017, and did not have any significant unrecognized uncertain tax positions as of December 31, 2019 and 2018. The Group does not believe that its assessment regarding unrecognized tax benefits will materially change over the next twelve months. Comprehensive income or loss U.S. GAAP generally requires that recognized revenue, expenses, gains and losses be included in net income or loss. Although certain changes in assets and liabilities are reported as separate components of the equity section of the consolidated balance sheets, such items, along with net income or loss, are components of comprehensive income or loss. The components of other comprehensive income or loss consist of exchange differences on translation of foreign operations. Loss per share Basic loss per share is computed by dividing net loss attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the period. Diluted loss per share reflects the potential dilution that could occur if securities or other contracts to issue ordinary shares were exercised or converted into ordinary shares. Potential dilutive securities are excluded from the calculation of diluted loss per share in loss periods as their effect would be anti-dilutive. Risks and Uncertainties The Company is subject to a number of risks associated with companies at a similar stage, including dependence on key individuals, competition from similar services and larger companies, volatility of the industry, ability to obtain regulatory clearance, ability to obtain adequate financing to support growth, the ability to attract and retain additional qualified personnel to manage the anticipated growth of the Company and general economic conditions. Recently adopted accounting pronouncements In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606) ("ASU 2014-09"), which was subsequently modified in August 2015 by ASU 2015-14, Revenue from Contracts with Customers: Deferral of the Effective Date. The Group adopted this standard effective January 1, 2019 using the modified retrospective approach, in which case the cumulative effect of applying the standard would be recognized at the date of initial application. The adoption does not have a material impact to the consolidated financial statements. In January 2016, the FASB issued Accounting Standards Update No. 2016-01 ("ASU 2016-01") "Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities," which amends various aspects of the recognition, measurement, presentation, and disclosure of financial instruments. The Group adopted ASU 2016-01 as of January 1, 2019 using the modified retrospective method for marketable equity securities and the prospective method for non-marketable equity securities. The following table summarizes the changes to the consolidated balance sheet for the adoption of ASU 2016-01: December 31, Adjustment January 1, Accumulated deficit $ (17,379,185 ) $ (1,490,033 ) $ (18,869,218 ) Accumulated other comprehensive loss $ (1,484,688 ) $ 1,490,033 $ 5,345 The Group has elected to use the measurement alternative for the non-marketable equity securities, defined as cost adjusted for changes from observable transactions for identical or similar investments of the same issuer, less impairment. The adoption of ASU 2016-01 increases the volatility of other income (expense), net, as a result of the unrealized gain or loss from the remeasurement of the Group's equity securities. Recently issued accounting standards which have not yet been adopted The Group is an "emerging growth company" as defined in the Jumpstart Our Business Startups Act of 2010 (the "JOBS Act"). Under the JOBS Act, the emerging growth companies ("EGCs") can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act until such time as those standards apply to private companies. In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses ("ASU 2016-13"). Subsequently, the FASB issued ASU 2019-05, Financial Instruments- Credit Losses (Topic 326): Targeted Transition Relief. The amendments in ASU 2016-13 update guidance on reporting credit losses for financial assets. These amendments affect loans, debt securities, accounts receivables, net investments in leases, off balance sheet credit exposures, reinsurance receivables, and any other financial assets not excluded from the scope that have the contractual right to receive cash. The amendments are effective for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years. As an EGC the Group can adopt the amendment for fiscal years beginning after December 15, 2021, and interim period within those fiscal years. The Group is currently evaluating the impact on its consolidated financial statements of adopting this standard. In February 2016, the FASB issued ASU 2016-02, Leases ("ASU 2016-02"), which requires a lessee to recognize a right-of-use asset and a lease liability for operating leases, initially measured at the present value of the future lease payments, in the balance sheet. ASU 2016-02 also requires a lessee to recognize a single lease cost, calculated so that the cost of the lease is allocated over the lease term, generally on a straight-line basis. This new guidance is effective for fiscal years beginning after December 15, 2019. Early adoption is permitted. The Group has evaluated the potential effects of adopting the provisions of ASU 2016-02 on its consolidated financial statements. The Group has estimated that the operating lease right-of-use assets of $959,641, and operating lease liabilities of $982,288 will be recognized at January 1, 2020 in the consolidated financial statements. In August 2018, the FASB issued ASU 2018-13, Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement, which amends ASC 820, Fair Value Measurement. This ASU modifies the disclosure requirements for fair value measurements by removing, modifying, or adding certain disclosures. The amendments are effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. The removed and modified disclosures will be adopted on a retrospective basis and the new disclosures will be adopted on a prospective basis. The adoption will not have a material effect on the Group's financial statements. In December 2019, the FASB issued Accounting Standards Update No. 2019-12, Income Taxes (Topic 740): "Simplifying the Accounting for Income Taxes" ("ASU 2019-12"), which simplifies the accounting for income taxes. This standard will be effective for fiscal years beginning after December 15, 2021, and interim periods within fiscal years beginning after December 15, 2022, on a prospective basis, and early adoption is permitted. The Group is currently evaluating the impact of the new standard on its consolidated financial statements. The Group does not believe other recently issued but not yet effective accounting standards, if currently adopted, would have a material effect on the consolidated financial position, statements of operations and cash flows. |
Revenue
Revenue | 12 Months Ended |
Dec. 31, 2019 | |
Deferred Revenue Disclosure [Abstract] | |
REVENUE | 4. REVENUE The Company adopted ASC 606 using the modified retrospective method as applied to customer contracts that were not completed as of January 1, 2019. As a result, financial information for reporting periods beginning after January 1, 2019 are presented under ASC 606, while comparative financial information has not been adjusted and continues to be reported in accordance with the Company's historical accounting policy for revenue recognition prior to the adoption of ASC 606. For the year ended December 31, 2019, all revenue came from provision of healthcare services in Hong Kong. |
Fair Value Measurement
Fair Value Measurement | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENT | 5. FAIR VALUE MEASUREMENT The following table provides the assets and liabilities carried at fair value measured on a recurring basis as of December 31, 2019 and 2018: December 31, 2019 Level 1 Level 2 Level 3 Total Current Assets Marketable securities Common stocks $ 806,778 $ 256,333 $ - $ 1,063,111 Investments in derivatives Warrants - - 203,320 203,320 Total assets at fair value $ 806,778 $ 256,333 $ 203,320 $ 1,266,431 December 31, 2018 Level 1 Level 2 Level 3 Total Current Assets Marketable securities – Available-for-sale securities Common stocks $ 813,728 $ 200,610 $ - $ 1,014,338 Investments in derivatives Warrants - - 115,721 115,721 Total assets at fair value $ 813,728 $ 200,610 $ 115,721 $ 1,130,059 The following is a reconciliation of Level 3 assets during the year ended December 31, 2019: Warrants Balance at January 1, 2019 $ 115,721 Change in unrealized appreciation 87,599 Balance at December 31, 2019 $ 203,320 Net change in unrealized appreciation relating to investments still held at December 31, 2019 87,599 The following is a reconciliation of Level 3 assets for the year ended December 31, 2018: Warrants Balance at January 1, 2018 $ 1,070,940 Change in unrealized depreciation (955,219 ) Balance at December 31, 2018 $ 115,721 Net change in unrealized depreciation relating to investments still held at December 31, 2018 (955,219 ) The following is a reconciliation of Level 3 assets for the period February 28, 2017 through December 31, 2017: Aptorum Common Preferred Warrants Convertible Total Balance at February 28, 2017 $ 757,647 $ 7,920,000 $ 4,314,998 $ 1,907,470 $ 3,082,020 $ 17,982,135 Transfer out of Level 3 due to change in status – consolidated subsidiary (a) (757,647 ) - - - - (757,647 ) Transfer out of fair value leveling since recorded as cost method (b) - (7,920,000 ) (4,314,998 ) - - (12,234,998 ) Balance at March 1, 2017 $ - $ - $ - $ 1,907,470 $ 3,082,020 $ 4,989,490 Reclassification between different investment type (c) - - 3,079,715 - (3,079,715 ) - Transfer out of fair value leveling since recorded as cost method (c) - - (3,079,715 ) - - (3,079,715 ) Change in unrealized depreciation - - - (836,530 ) (2,305 ) (838,835 ) Balance at December 31, 2017 $ - $ - $ - $ 1,070,940 $ - $ 1,070,940 Net change in unrealized depreciation relating to investments still held at December 31, 2017 - - - (836,530 ) - (836,530 ) a. Upon the effective date of the change in status, March 1, 2017, the subsidiaries were no longer recognized at fair value and were instead consolidated when preparing the financial statements. b. The equity investments of common stock and preferred stock were non-marketable investments under cost method upon change in status. Subsequently, Athenex Inc. was listed on the NASDAQ stock exchange on June 14, 2017 and common stock with an amount of $7,920,000 has been transferred to common stock in Level 1 with amount of $7,920,000, which was subsequently sold in December 2017 with a gain from the marketable securities of $3,722,234 recognized. c. On March 9, 2017, the convertible promissory notes (including its accrued interest, totally $520,822) of Centrexion Therapeutics Corporation was converted into preferred stock (Series C) of the same company. On May 25, 2017, the convertible promissory notes (including its accrued interest, totaling $2,558,893) of Alzheon Inc., was converted into preferred stock (Series B) of the same company. The preferred stocks are considered non-marketable investments and were therefore reclassified out of the fair value hierarchy to be reported under cost method. The following table presents the quantitative information about the Group's Level 3 fair value measurements of investment as of December 31, 2019 and 2018, which utilized significant unobservable internally-developed inputs: December 31, Valuation technique Unobservable input Range (weighted average) Sensitivity of fair value to input Warrants Black-Scholes Model Estimated time to exit Historical Volatility 12-18 months 73% - 301% 10% increase (decrease) in volatility would result in increase (decrease) in fair value by $17,871 December 31, Valuation technique Unobservable input Range (weighted average) Sensitivity of fair value to input Warrants Black-Scholes Model Estimated time to exit Historical Volatility 12-30 months 73% - 188% 10% increase (decrease) in volatility would result in increase (decrease) in fair value by $19,691 Warrants As of December 31, 2019 and 2018, the volume of the Group's derivative activities based on their notional amount and number of contracts, categorized by primary underlying risk, are as follows: Long Exposure December 31, 2019 December 31, 2018 Primary underlying risk Notional Number of Contracts Notional Amounts Number of Contracts Equity Price Warrants $ 265,576 2,234,373 $ 218,270 2,257,682 The following table identifies the fair value amounts of derivative instruments included in the consolidated balance sheets as derivative contracts, categorized by primary underlying risk, as of December 31, 2019 and 2018. December 31, December 31, Primary underlying risk Derivative Derivative Derivative Derivative Equity Price Warrants $ 203,320 $ - $ 115,721 $ - The following table identifies the net gain and loss amounts included in the consolidated statement of operations as net unrealized gain (loss) from derivative contracts, categorized by primary underlying risk, for the years ended December 31, 2019 and 2018, and the period March 1, 2017 through December 31, 2017: Year ended Year ended March 1, 2017 through December 31, 2017 Primary underlying risk Realized Unrealized Realized Unrealized Realized Unrealized Equity Price Warrants $ - $ 87,599 $ (19,225 ) $ (955,219 ) $ (7,094 ) $ (820,407 ) Non-marketable equity securities remeasured for the year ended December 31, 2019 are classified within Level 3 in the fair value hierarchy because the Group estimated the value based on valuation methods using the observable transaction price at the transaction date and other unobservable inputs including volatility, rights, and obligations of the securities hold. The following is a summary of unrealized gains and losses recorded in other income (expense), net, and included as adjustments to the carrying value of non-marketable investments held as of December 31, 2019: Year ended Upward adjustments $ 1,017,468 Total unrealized gain for non-marketable investments $ 1,017,468 The following table summarizes the total carrying value of our non-marketable investments held as of December 31, 2019 including cumulative unrealized upward and downward adjustments made to the initial cost basis of the investments: December 31, Initial cost basis $ 6,094,712 Upward adjustments 1,017,468 Total carrying value at the end of the period $ 7,112,180 |
Other Receivables and Prepaymen
Other Receivables and Prepayments | 12 Months Ended |
Dec. 31, 2019 | |
Receivables [Abstract] | |
OTHER RECEIVABLES AND PREPAYMENTS | 6. OTHER RECEIVABLES AND PREPAYMENTS Other receivables and prepayments as of December 31, 2019 and 2018 consisted of: December 31, December 31, Prepaid insurance $ 154,011 $ 147,864 Prepaid service fee 296,565 75,224 Rental deposits 8,584 8,576 Prepaid rental expenses 37,169 46,948 Prepaid research and development expenses 453,634 41,614 Other receivables 109,714 109,435 Others 19,366 34,495 $ 1,079,043 $ 464,156 As of December 31, 2019, the balance included $108,000 prepayment to Aenco Solutions Limited, a related party which is controlled by Ian Huen, the Chief Executive Officer and Executive Director of the Group, for tokens consultancy services (see note 13). |
Digital Currencies
Digital Currencies | 12 Months Ended |
Dec. 31, 2019 | |
Digital Currencies [Abstract] | |
DIGITAL CURRENCIES | 7. Digital Currencies The following table presents additional information about digital currencies: December 31, December 31, Beginning balance $ - $ - Purchase of digital currencies 200,000 - Utilization of digital currencies to settle service fee (245,178 ) - Gain on use of digital currencies 46,717 - Ending balance $ 1,539 $ - |
Property, Plant and Equipment,
Property, Plant and Equipment, Net | 12 Months Ended |
Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY, PLANT AND EQUIPMENT, NET | 8. PROPERTY, PLANT AND EQUIPMENT, NET Property, plant and equipment as of December 31, 2019 and 2018 consisted of: December 31, 2019 December 31, 2018 Building $ 1,488,396 $ 1,488,396 Computer equipment 76,365 64,911 Furniture, fixture, and office and medical equipment 271,009 262,819 Leasehold improvements 665,546 664,713 Laboratory equipment 4,029,640 2,045,034 Motor vehicle 239,093 239,093 Assets in construction 1,899,169 - 8,669,218 4,764,966 Less: accumulated depreciation 1,576,183 504,364 Property, plant and equipment, net $ 7,093,035 $ 4,260,602 Depreciation expenses for property, plant and equipment amounted to $1,071,799, $497,908 and $6,470 for the years ended December 31, 2019 and 2018, and the period March 1, 2017 through December 31, 2017, respectively. |
Intangible Assets, Net
Intangible Assets, Net | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS, NET | 9. INTANGIBLE ASSETS, NET December 31, December 31, 2018 Gross carrying amount Prepaid unpatented license $ 200,000 $ 200,000 Prepaid patented licenses 1,322,820 1,322,820 Computer software 97,462 61,384 1,620,282 1,584,204 Less: accumulated amortization Prepaid patented licenses 257,619 155,026 Computer software 50,980 19,638 308,599 174,664 Intangible assets, net Prepaid unpatented license 200,000 200,000 Prepaid patented licenses 1,065,201 1,167,794 Computer software 46,482 41,746 Intangible assets, net $ 1,311,683 $ 1,409,540 As of December 31, 2019 and 2018, the Group has capitalized seven of the exclusive licenses which includes seven patented and one unpatented technologies in the areas of neurology, infectious diseases, gastroenterology, oncology, surgical robotics and natural health. Pursuant to the license agreements, the Group paid upfront payments and became the exclusive licensee to prosecute certain patents developed or licensed under the applicable agreements. The Group recognized the prepaid unpatented license to reflect the fair value of the subsidiaries as of the date of the change in status from an investment company to an operating entity. The Group capitalizes the prepaid patented license for the exclusive rights with completed filing of patents in certain jurisdictions (e.g., the United States of America and Europe) and alternative future uses. Prepaid unpatented license is indefinite-lived intangible assets which are tested for impairment annually. Prepaid patented licenses and computer software are finite-lived intangible assets which are amortized over their estimated useful life. Amortization expenses for finite-lived intangible assets amounted to $167,985, $124,551 and $52,433 for the years ended December 31, 2019 and 2018, and the period March 1, 2017 through December 31, 2017, respectively. The Group wrote off the cost and the related amortization of $34,400, $2,320 and $nil after the expiration of the computer software for the years ended December 31, 2019 and 2018, and the period March 1, 2017 through December 31, 2017, respectively. The Group expects amortization expense related to its finite-lived intangible assets for the next five years and thereafter to be as follows as of December 31, 2019: For the years ending December 31, Amount 2020 $ 146,826 2021 104,842 2022 102,593 2023 102,593 2024 97,099 Thereafter 557,730 Total $ 1,111,683 |
Long-Term Deposits
Long-Term Deposits | 12 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
LONG-TERM DEPOSITS | 10. LONG-TERM DEPOSITS Long-term deposits as of December 31, 2019 and 2018 consisted of: December 31, December 31, 2018 Rental deposits $ 132,043 $ 132,043 Prepayments for equipment 162,563 3,285,135 $ 294,606 $ 3,417,178 |
Accounts Payable and Accrued Ex
Accounts Payable and Accrued Expenses | 12 Months Ended |
Dec. 31, 2019 | |
Accounts Payable and Accrued Liabilities, Current [Abstract] | |
ACCOUNTS PAYABLE AND ACCRUED EXPENSES | 11. ACCOUNTS PAYABLE AND ACCRUED EXPENSES Accounts payable and accrued expenses as of December 31, 2019 and 2018 consisted of: December 31, December 31, 2018 Research and development expenses payable $ 554,791 $ 398,899 Cost of healthcare services payable 45,234 40,139 Professional fees payable 171,037 178,117 Insurance expense payable 70,811 - Interest payable 8,802 223,802 Payables for leasehold improvement and equipment 26,779 73,864 Deferred bonus and salaries payable 1,570,324 183,065 Deferred rent 55,484 58,810 Others 83,265 90,451 $ 2,586,527 $ 1,247,147 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | 12. INCOME TAXES The Company and its subsidiaries file tax returns separately. Income taxes Cayman Islands: under the current laws of the Cayman Islands, the Company and its subsidiaries in the Cayman Islands are not subject to taxes on their income and capital gains. Hong Kong: in accordance with the relevant tax laws and regulations of Hong Kong, a company registered in Hong Kong is subject to income taxes within Hong Kong at the applicable tax rate on taxable income. In March 2018, the Hong Kong Government introduced a two-tiered profit tax rate regime by enacting the Inland Revenue (Amendment) (No.3) Ordinance 2018 (the "Ordinance"). Under the two-tiered profits tax rate regime, the first $2 million of assessable profits of qualifying corporations is taxed at 8.25% and the remaining assessable profits at 16.5%. The Ordinance is effective from the year of assessment 2018-2019. According to the policy, if no election has been made, the whole of the taxpaying entity's assessable profits will be chargeable to Profits Tax at the rate of 16.5% or 15%, as applicable. Because the preferential tax treatment is not elected by the Group, all the subsidiaries registered in Hong Kong are subject to income tax at a rate of 16.5%. The subsidiaries registered in Hong Kong did not have assessable profits that were derived Hong Kong during the years ended December 31, 2019 and 2018, and the period March 1, 2017 through December 31, 2017. Therefore, no Hong Kong profit tax has been provided for in the periods presented. United Kingdom: in accordance with the relevant tax laws and regulations of United Kingdom, a company registered in the United Kingdom is subject to income taxes within United Kingdom at the applicable tax rate on taxable income. All the United Kingdom subsidiaries that are not entitled to any tax holiday were subject to income tax at a rate of 19%. The subsidiary in United Kingdom did not have assessable profits that were derived from United Kingdom during the years ended December 31, 2019 and 2018, and the period March 1, 2017 through December 31, 2017. Therefore, no United Kingdom profit tax has been provided for in the periods presented. Singapore: in accordance with the relevant tax laws and regulations of Singapore, a company registered in the Singapore is subject to income taxes within Singapore at the applicable tax rate on taxable income. All the Singapore subsidiaries that are not entitled to any tax holiday were subject to income tax at a rate of 17%. The subsidiary in Singapore did not have assessable profits that were derived from Singapore during the years ended December 31, 2019 and 2018, and the period March 1, 2017 through December 31, 2017. Therefore, no Singapore profit tax has been provided for in the periods presented. Seychelles: in accordance with the relevant tax laws and regulations of Seychelles, a company registered in the Seychelles is subject to income taxes within Seychelles at the applicable tax rate on taxable income. All the Seychelles subsidiaries that are not entitled to any tax holiday were subject to income tax at a rate of 25%. The subsidiary in Seychelles did not have assessable profits that were derived from Seychelles during the years ended December 31, 2019 and 2018, and the period March 1, 2017 through December 31, 2017. Therefore, no Seychelles profit tax has been provided for in the periods presented. Samoa: in accordance with the relevant tax laws and regulations of Samoa, a company registered in the Samoa is subject to income taxes within Samoa at the applicable tax rate on taxable income. All the Samoa subsidiaries that are not entitled to any tax holiday were subject to income tax at a rate of 27%. The subsidiary in Samoa did not have assessable profits that were derived from Samoa during the years ended December 31, 2019 and 2018, and the period March 1, 2017 through December 31, 2017. Therefore, no Samoa profit tax has been provided for in the periods presented. United States (Nevada): in accordance with the relevant tax laws and regulations of the United States, a company registered in the United States is subject to income taxes within the United States at the applicable tax rate on taxable income. All the United States subsidiaries in Nevada that are not entitled to any tax holiday were subject to income tax at a rate of 21%. The subsidiary in the United States did not have assessable profits that were derived from the United States during the years ended December 31, 2019 and 2018, and the period March 1, 2017 through December 31, 2017. Therefore, no United States profit tax has been provided for in the periods presented. The components of the provision for income taxes expenses are: Year ended December 31, 2019 Year ended December 31, 2018 March 1, 2017 Current $ - $ - $ - Deferred - - - Total income taxes expense $ - $ - - The reconciliation of income taxes expenses computed at the Hong Kong statutory tax rate applicable to income tax expense is as follows: Year ended Year ended March 1, Net loss before tax $ (20,116,938 ) $ (15,134,485 ) $ (2,561,507 ) Provision for income taxes at Hong Kong statutory income tax rate (16.5%) (3,319,294 ) (2,497,190 ) (422,649 ) Impact of different tax rates in other jurisdictions (91,623 ) (3,066 ) - Non-taxable income (389,714 ) (95,018 ) - Non-deductible expenses 702,433 540,893 - Prior year tax effect - - (576,970 ) Change in valuation allowance 3,098,198 2,054,381 999,619 Effective income tax expense $ - $ - $ - Deferred tax asset, net Deferred tax assets and deferred tax liabilities reflect the tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purpose and the tax bases used for income tax purpose. The following represents the tax effect of each major type of temporary difference. December 31, December 31, Deferred tax asset: Tax loss carry forward $ 6,699,345 $ 3,499,428 Deferred tax liability: Depreciation and amortization (547,147 ) (445,428 ) Net deferred tax assets before valuation allowance 6,152,198 3,054,000 Valuation allowance (6,152,198 ) (3,054,000 ) Deferred tax asset, net $ - $ - As of December 31, 2019 and 2018, the Group had net operating loss carry-forwards of $40,329,428 and $21,191,279, respectively, including its Hong Kong, Singapore, Seychelles, Samoa, the United States and the United Kingdom operations, which are available to reduce future taxable income. Net operating loss carry forward from Seychelles amounting to $439,345 as of December 31, 2019 are available to be carried forward for 5 years, while all of the other losses can be carried forward indefinitely. Valuation allowance was provided against deferred tax assets in entities where it was determined, it was more likely than not that the benefits of the deferred tax assets will not be realized. The Group had deferred tax assets which consisted of tax loss carry forward, which can be carried forward to offset future taxable income. The Group maintains a full valuation allowance on its net deferred tax assets. The management determines it is more likely than not that all of its deferred tax assets will not be utilized. The valuation allowance increased by $3,098,198, $2,054,381 and $999,619, respectively, for the years ended December 31, 2019 and 2018, and the period March 1, 2017 through December 31, 2017. |
Related Party Balances and Tran
Related Party Balances and Transactions | 12 Months Ended |
Dec. 31, 2019 | |
Related Party Transactions [Abstract] | |
RELATED PARTY BALANCES AND TRANSACTIONS | 13. RELATED PARTY BALANCES AND TRANSACTIONS The following is a list of a director and related parties to which the Group has transactions with: (a) Ian Huen, the Chief Executive Officer and Executive Director of the Group; (b) AENEAS CAPITAL LIMITED, an entity controlled by Ian Huen; (c) Aeneas Limited, an entity controlled by Ian Huen; (d) Aeneas Group Limited, an entity controlled by Ian Huen; (e) Aeneas Management Limited, an entity controlled by Ian Huen; (f) Aenco Solutions Limited, an entity controlled by Ian Huen; (g) Aenco Limited, an entity controlled by Ian Huen; (h) Jurchen Investment Corporation, the holding company and an entity controlled by Ian Huen; (i) Clark Cheng, the Executive Director of the Group; (j) Sabrina Khan, the Chief Financial Officer of the Group. Amounts due from related parties Amounts due from related parties consisted of the following as of December 31, 2019 and 2018: December 31, December 31, Current Aeneas Management Limited $ 962 $ - AENEAS CAPITAL LIMITED - 169,051 Total $ 962 $ 169,051 Non-current Jurchen Investment Corporation (Note e) 50,000 50,000 Amounts due to related parties Amounts due to related parties consisted of the following as of December 31, 2019 and 2018: December 31, December 31, Current Aenco Solutions Limited $ 5,782 $ - Aeneas Group Limited 14,247 - Jurchen Investment Corporation 20,055 - Ian Huen 127 2,545 Clark Cheng 1,114 8,893 Sabrina Khan 268 21,979 Total $ 41,593 $ 33,417 Non-current Aeneas Group Limited (Note a) $ 3,330,472 $ - Jurchen Investment Corporation (Note a) 3,000,000 - 6,330,472 - Related party transactions Related party transactions consisted of the following for the years ended December 31, 2019 and 2018, and the period March 1, 2017 through December 31, 2017: Year ended Year ended March 1, Borrowings from related parties (Note a) - Aeneas Group Limited $ 3,330,472 $ - $ - - Jurchen Investment Corporation $ 3,000,000 $ - $ - Interest expenses (Note a) - Aeneas Group Limited $ 14,247 $ - $ - - Jurchen Investment Corporation $ 20,055 $ - $ - Payments on behalf of the Group (Note b) - AENEAS CAPITAL LIMITED $ 5,057 $ - $ 64,038 - Aeneas Management Limited $ 5,372 $ 156,961 $ - - Aenco Solutions Limited $ 186,671 $ - $ - Prepayments to related parties (Note b) - Aenco Solutions Limited $ 200,000 $ - $ - Expense reimbursement (Note b) - AENEAS CAPITAL LIMITED $ 5,057 $ 7,331 $ 66,881 - Aeneas Management Limited $ 5,372 $ 156,961 $ - Payments on behalf of related parties (Note c) - AENEAS CAPITAL LIMITED $ - $ 22,934 $ 109,025 - Aeneas Limited $ - $ - $ 132,074 - Aeneas Group Limited $ - $ - $ 1,853 Repayments from related parties (Note c) - AENEAS CAPITAL LIMITED $ 169,051 $ 132,128 $ - - Aeneas Limited $ - $ 190,427 $ - - Aeneas Group Limited $ - $ 7,451 $ - Healthcare services income - Aeneas Management Limited $ 1,923 $ - $ - Consultant, management and administrative fees (Note d) - AENEAS CAPITAL LIMITED $ - $ 448,718 $ 640,932 - Aeneas Management Limited $ 698,152 $ - $ - - Aenco Limited $ 830,769 $ - $ - Rental expense(Note e) - Jurchen Investment Corporation $ 227,729 $ 207,841 $ - Payment for rental deposit (Note e) - Jurchen Investment Corporation $ - $ 50,000 $ - Tokens maintenance fee (Note b) - Aenco Solutions Limited $ 67,876 $ - $ - Issuance of tokens for tokens creation, offering and consultancy services (Note f) - Aenco Solutions Limited $ 300,000 $ - $ - Tokens creation, offering and consultancy services expense (Note f) - Aenco Solutions Limited $ 192,000 $ - $ - Prepayment of tokens consultancy services (Note f) - Aenco Solutions Limited $ 108,000 $ - $ - A borrowing from a related party (Note g) - Ian Huen $ - $ - $ 6,410 Note a: On August 13, 2019, the Group entered into financing arrangements with Aeneas Group Limited, a related party, and Jurchen Investment Corporation, the ultimate parent of the Group, allowing the Group to access up to a total $15.0 million in line of credit debt financing. The line of credit will mature on August 12, 2022 and the interest on the outstanding principal indebtedness will be at the rate of 8% per annum. Note b: AENEAS CAPITAL LIMITED and Aeneas Management Limited has paid the operation fee on behalf of the Group and received the expense reimbursement. The balances were non-interest bearing. The Group has prepaid Aenco Solutions Limited, of which the whole amounts were non-interest bearing. The prepayment was used for paying on behalf of the Group of token listing fees, purchasing digital currencies and settlement of maintenance service provided by Aenco Solutions Limited. Note c: The Group has paid the expenses on behalf of AENEAS CAPITAL LIMITED, Aeneas Limited and Aeneas Group Limited, of which all amounts were non-interest bearing. There was no further payment on behalf transactions since April 2018. Note d: AENEAS CAPITAL LIMITED provides certain management and administrative services to the Group. For the year ended December 31, 2018, AENEAS CAPITAL LIMITED was entitled to receive a fixed amount of administrative fees of HKD500,000 (approximately $64,103) per calendar month. On July 31, 2018, the agreement was mutually agreed to be terminated. Aenco Limited provided certain information technology services to the Group. For the year ended December 31, 2019, Aenco Limited was entitled to receive a fixed amount of services fees of HKD540,000 (approximately $69,231) per calendar month with the expiry date on December 31, 2019. The agreement was originally renewed under the same terms with the expiry date on December 31, 2020. On January 29, 2020, both parties agreed to replace the agreement no later than April 30, 2020. Pursuant to the replaced agreement, Aenco Limited is entitled to receive a fixed amount of services fee of HKD700,000 (approximately $89,744) per calendar month. The agreement will be expired on December 31, 2020. Aeneas Management Limited provided certain documentation and administrative services to the Group. For the year ended December 31, 2019, Aeneas Management Limited was entitled to receive a fixed amount of services fees of HKD452,000 (approximately $57,949) per calendar month with the expiry date on December 31, 2019. The agreement was originally renewed under the same terms with the expiry date on December 31, 2020. On January 29, 2020, both parties agreed to terminate the agreement no later than April 30, 2020. Note e: Jurchen Investment Corporation entered into a sub-tenancy agreement with a subsidiary of the Group for the rental arrangement of an office in Hong Kong. For the period February 1, 2018 through January 31, 2021, Jurchen Investment Corporation was entitled to receive a fixed amount of rental fee of HK$130,000 (approximately USD16,667) per calendar month. As of December 31, 2019, the amounts due from Jurchen Investment Corporation represented a $50,000 rental deposit. Note f: In July 2019, Smart Pharmaceutical Limited Partnership, a wholly owned subsidiary of the Group, transferred 100,000,000 SMPT token to Aenco Solutions Limited, a related party, in exchange of the services related to token creation and offering and consulting services for five years for an amount of $300,000. Note g: The non-interest-bearing loan was borrowed from management for operation purpose and the loan was due on demand. On November 11, 2017, the Group sold 100% of the ownership of Aeneas Limited and its subsidiary, Aeneas Group Limited, to Jurchen Investment Corporation for cash proceeds of $1. The Group recognized a gain on disposal of entity under common control of $67,874, net of net liabilities of Aeneas Limited and its subsidiary of $67,874 in consolidated statement of equity. On April 3, 2018, Aptorum Medical Limited issued 526 shares to Clark Cheng, decreasing the equity interest of the Company from 100% to 95%. On March 29, 2019, Aptorum Medical Limited issued 112 shares to Clark Cheng in according to the appointment agreement, decreasing the equity interest of the Company from 95% to 94%. On January 2, 2020, Aptorum Medical Limited further issued 115 shares to Clark Cheng in according to the appointment agreement, decreasing the equity interest of the Company from 94% to 93%. In April 2018, the Group, AENEAS CAPITAL LIMITED, Aeneas Management Limited and Aeneas Group Limited entered into a net settlement agreement to offset the amounts due from related parties against the amounts due to related parties. Thereby, the Group is released from obligation for a total amount of $164,973, netting off receivables of total amount of $197,878 and collected remaining balance of $32,905. |
Convertible Debts
Convertible Debts | 12 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
CONVERTIBLE DEBTS | 14. CONVERTIBLE Debts Convertible bonds On April 6, 2018, the Group entered into a subscription agreement (the "Bond Subscription Agreement") with Peace Range Limited ("Peace Range"). Pursuant to the Bond Subscription Agreement, the Group issued Peace Range a $15,000,000 convertible bond (the "Bond" and the "Bond Offering") on April 25, 2018. In accordance with Accounting Standards Codification ("ASC") 470-20-30-8, the Group should record a charge equal to the lower amount of either i) the Intrinsic Value of the BCF or ii) the proceeds realized upon the issuance of the Bond. The Group completed its IPO on December 17, 2018. Pursuant to the terms of the Bond, 10% of the outstanding principal amount of the Bond was automatically converted into 119,217 Class A Ordinary Shares. Upon the automatic conversion, the contingency was effectively resolved, and the value of the 10% of the BCF of $383,629 was recorded as additional interest expense with a corresponding increase to additional paid-in capital. The remaining BCF of $3,452,657 was recorded as debt discount, which was amortized through the maturity of the convertible debts, with a corresponding increase to additional paid-in capital. The following lists the components of the ending balance of convertible debts as of December 31, 2019 and 2018, respectively: December 31, December 31, 2018 Gross convertible debts $ - $ 13,500,000 Less: Discount on issuance cost - 314,744 Discount on BCF - 3,077,950 Convertible debts, net $ - $ 10,107,306 For the years ended December 31, 2019 and 2018, and the period March 1, 2017 through December 31, 2017, the amortization of BCF and interest accretion of convertible debts were $3,392,694, $1,042,870 and $nil respectively. The contractual interest for the years ended December 31, 2019 and 2018, and the period March 1, 2017 through December 31, 2017 were $342,333, $815,000 and $nil respectively On April 24, 2019, the Group repurchased its convertible debts at $13.6 million with carrying amount of $13.5 million and a gain on extinguishment on convertible debts of $1.2 million was recognized. The repurchasing of convertible debts is considered an extinguishment and the difference between the repurchasing price of debt, and the net carrying amount of the extinguished debt and the intrinsic value of BCF is recognized on the consolidated statements of operations. The intrinsic value of BCF of $1.3 million at the extinguishment date was recorded as a reduction of additional paid-in capital. Convertible promissory notes As of December 31, 2018, the Group has issued $1,600,400 of convertible promissory notes accumulatively (the "Notes"). An unamortized debt issuance costs and discounts of $22,935 was remaining before the IPO. For the year ended December 31, 2018, the interest accretion and the contractual interest coupon of the Notes was $26,380 and $8,802, respectively. The Group completed its IPO on December 17, 2018. Pursuant to the terms of the Notes, all of the outstanding principal amount of the Notes was automatically converted into 230,252 Class A Ordinary Shares. The intrinsic value of the BCF was determined to be $1,600,400. The Group concluded that the contingency was effectively resolved upon the automatic conversion, and recorded a one-time charge to interest expense of $1,600,400 with a corresponding increase to additional paid-in capital. |
Finance Lease
Finance Lease | 12 Months Ended |
Dec. 31, 2019 | |
Finance Lease [Abstract] | |
FINANCE LEASE | 15. FINANCE LEASE On May 14, 2018, the Group leased a vehicle for its operation with a lease term of 54 months, and the lease was classified as a finance lease. The following lists the components of the net present value of finance leases obligation: December 31, December 31, Gross finance lease obligation $ 157,047 $ 210,891 Less: Discount on finance lease obligation 13,173 23,141 143,874 187,750 Less: Current portion of finance lease obligation 46,555 43,877 Net present value of finance lease obligation, net of current portion $ 97,319 $ 143,873 The present value of the net minimum payments on finance lease as of December 31, 2019 is as follows: 2020 2021 2022 Total Minimum lease payments $ 53,845 $ 53,845 $ 49,357 $ 157,047 Less: Amortization of discount 7,290 4,449 1,434 13,173 Finance lease obligation $ 46,555 $ 49,396 $ 47,923 $ 143,874 |
Ordinary Shares
Ordinary Shares | 12 Months Ended |
Dec. 31, 2019 | |
Equity [Abstract] | |
ORDINARY SHARES | 16. ORDINARY SHARES On December 17, 2018, the Group consummated its IPO of 761,419 Class A Ordinary Shares. The shares were sold at a price of $15.80 per share, generating gross proceeds to the Group of approximately $12,030,420. At the completion of the IPO, $1,732,370 offering costs was charged to additional paid-in capital. Following the consummation of the IPO and automatic conversion of the convertible debts instruments, there were an aggregate of 6,537,269 Class A Ordinary Shares issued and outstanding as of December 31, 2018. On June 19, 2019, the Group issued 60,093 Class A Ordinary Shares to warrant holders on a cashless basis. Following the exercise of warrants (see Note 19), there were an aggregate of 6,597,362 Class A Ordinary Shares issued and outstanding as of December 31, 2019. Holders of Class A Ordinary Shares and Class B Ordinary Shares have the same rights except for the following: (i) each Class A Ordinary Share is entitled to one vote while each Class B Ordinary Share is entitled to ten votes; and (ii) each Class B Ordinary Share is convertible into one Class A Ordinary Share at any time while Class A Ordinary Shares are not convertible under any circumstances. |
Share Based Compensation
Share Based Compensation | 12 Months Ended |
Dec. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | |
SHARE BASED COMPENSATION | 17. SHARE BASED COMPENSATION Share option plan A total of 5,500,000 Class A Ordinary Shares (subject to subsequent adjustments described more fully below) may be issued pursuant to awards under the 2017 Omnibus Incentive Plan (the "2017 Share Option Plan"). Subsequent adjustments include that on each January 1, starting with January 1, 2020, an additional number of shares equal to the lesser of (i) 2% of the outstanding number of Class A Ordinary Shares (on a fully diluted basis) on the immediate preceding December 31, and (ii) such lower number of Class A Ordinary Shares as may be determined by the board of directors, subject in all cases to adjustments as provided in Section 10 of the 2017 Share Option Plan. Awards will be made pursuant to agreements and may be subject to vesting and other restrictions as determined by the board of directors. On March 15, 2019, the Company granted 218,222 share options to directors, employees, external consultants and advisors of the Group in accordance to the 2017 Share Option Plan with an exercise price of $12.91. A summary of the option activity as of December 31, 2019 and changes during the period is presented below: Number of share options Weighted average exercise Remaining contractual term in years Outstanding, January 1, 2019 - - - Granted 218,222 12.91 12.31 Outstanding, December 31, 2019 218,222 12.91 11.51 Exercisable, December 31, 2019 - - - Intrinsic value is calculated as the amount by which the current market value of a share of common stock exceeds the exercise price multiplied by the number of option. The aggregate intrinsic value of options outstanding as of December 31, 2019 was approximately $642,000. The fair value of each stock option award is estimated on the date of grant using the Black-Scholes option pricing model under the following assumptions. Date of grant Expected volatility 95.02%-95.15% Risk-free interest rate 2.46%-2.49% Expected term from grant date (in years) 6.29-7.29 Dividend rate - Dilution factor 0.9962 Fair value $10.10-10.52 In connection with the grant of share options to employees and non-employees, the Group recorded share-based compensation charges of $1,180,477 and $432,355, respectively. |
Non-Controlling Interest
Non-Controlling Interest | 12 Months Ended |
Dec. 31, 2019 | |
Noncontrolling Interest [Abstract] | |
NON-CONTROLLING INTEREST | 18. NON-CONTROLLING INTEREST As of December 31, 2018, non-controlling interest related to the 1% equity interest in APTUS BIOTECHNOLOGY (MACAO) LIMITED, 10% equity interest in mTOR (Hong Kong) Limited, 5% equity interest in Aptorum Medical Limited ("AML"), 20% equity interest in Acticule, and 20% equity interest in the Lanither Life Sciences Limited in the consolidated balance sheets was deficit of $368,533 in total. On March 29, 2019, AML, a majority-owned subsidiary of the Group, issued 112 shares to a director of the Group, which resulted an increase of his equity interest of AML from 5% to 6%. A deficit of $10,672 was reclassified from additional paid-in capital to non-controlling interests within the Group's consolidated financial statements On April 24, 2019, the Smart Pharma Tokens ("SMPT tokens") was announced to be launched. The SMPT tokens are secured by way of a floating charge against the Project intellectual property ("IP") to guarantee the distribution of accrued sales-based royalties, sublicensing income or additional cash flow generated by drug candidates developed by the Smart-ACT TM TM Total 1 billion SMPT tokens are offered by Smart Pharmaceutical Limited Partnership ("SPLP"), a wholly owned subsidiary of the Group. In July 2019, SPLP transferred 100,000,000 SMPT tokens to Aenco Solutions Limited, a related party of the Group, in exchange for the services related to the tokens creation, offering and 5-year consultancy service. Amount of $300,000 were classified as a component of non-controlling interests within the Group's consolidated financial statements. The remaining 900,000,000 SMPT tokens are remained and kept by SPLP. As of December 31, 2019, non-controlling interest related to 10% equity interest in mTOR (Hong Kong) Limited, 6% equity interest in Aptorum Medical Limited, 20% equity interest in Acticule, 20% equity interest in the Lanither Life Sciences Limited and the token issued by SPLP in the consolidated balance sheets was deficit of $1,509,456 in total. For the years ended December 31, 2019 and 2018, and the period March 1, 2017 through December 31, 2017, non-controlling interest in the consolidated statements of operations were loss of $1,430,176, $302,762 and $14,045, respectively. |
Warrants
Warrants | 12 Months Ended |
Dec. 31, 2019 | |
Warrants [Abstract] | |
WARRANTS | 19. Warrants On November 30, 2018 and December 17, 2018, the Company entered into several agreements with underwriter. In return for the underwriter's services, the Company issued an aggregate of 80,453 and 38,071 warrants to purchase the same number of the Company's ordinary shares, for the convertible debts and the IPO, respectively. The shares were fully vested upon the IPO completion date and the fair value of the warrants was $659,697 and $218,147, respectively, which was calculated using the Black-Scholes pricing model, with the following weighted-average assumptions. The Group analyzed the warrants issued in the IPO and the convertible debts in accordance with ASC Topic 815 "Derivatives and Hedging". In accordance with ASC Topic 815, the Group determined that the warrants should not be considered index to its own stock, as the strike price of the warrants is dominated in a currency (USD) other than the primary economy environment currency of the Group (HKD). As a result, the warrants do not meet the scope exception of ASC Topic 815, therefore, should be accounted for as derivative liabilities and measure at fair value with changes in fair value be recorded in earnings in each reporting period. All warrants were exercised on June 19, 2019 on a cashless basis. $866,300 loss in changes in fair value of warrant liabilities was recorded in consolidated statements of operations. December 31, December 31, Expected volatility - % 58.18 % Risk-free interest rate - 2.820%-2.822% Expected term from grant date (in years) - 2.43 Dividend rate - - Fair value $ - $ 4.60-9.48 Expected Volatility The expected volatility used for the year ended December 31, 2018 is based upon the Company's peer group trading history. Risk-Free Interest Rate The risk-free interest rate assumption is based on U.S. Treasury instruments with a term consistent with the contractual term of the warrants issued. Expected Term The expected term of the warrants issued represents the remaining contractual term of the warrants. Dividend Yield The Company has never declared or paid any cash dividends and does not plan to pay cash dividends in the foreseeable future, and therefore, used an expected dividend yield of zero in the valuation model. The movement of the warrants for the years ended December 31, 2019 and 2018 are as following: Warrants Weighted Average Exercise Price Weighted Average Remaining Contractual Term in Years Outstanding, January 1, 2019 118,524 $ 13.79 2.43 Exercised 118,524 $ 13.79 1.96 Outstanding, December 31, 2019 - $ - - Outstanding, January 1, 2018 - $ - - Granted 118,524 $ 13.79 2.50 Outstanding, December 31, 2018 118,524 $ 13.79 2.43 |
Net Loss Per Share
Net Loss Per Share | 12 Months Ended |
Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |
NET LOSS PER SHARE | 20. NET LOSS PER SHARE The following table sets forth the computation of basic and diluted loss per share: Year ended December 31, Year ended December 31, March 1, 2017 through December 31, 2017 Numerator: Net loss attributable to Aptorum Group Limited $ (18,686,762 ) $ (14,831,723 ) $ (2,547,462 ) Denominator: Basic and diluted weighted average common shares outstanding 29,008,445 27,909,788 26,963,435 Basic and diluted loss per share $ (0.64 ) $ (0.53 ) $ (0.09 ) Basic loss per share is computed by dividing net loss attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the period. Diluted loss per share reflects the potential dilution that could occur if securities or other contracts to issue ordinary shares were exercised or converted into ordinary shares. Potential dilutive securities are excluded from the calculation of diluted loss per share in loss periods as their effect would be anti-dilutive. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | 21. COMMITMENTS AND CONTINGENCIES Lease Commitments The total future minimum lease payments under the non-cancellable operating leases with respect to the offices and the laboratory For the years ending December 31, Amount 2020 $ 597,198 2021 397,842 2022 75,174 2023 - 2024 and thereafter - Total $ 1,070,214 Rental expenses for the years ended December 31, 2019 and 2018, and the period March 1, 2017 through December 31, 2017 were $664,155, $591,546 and $49,518, respectively. Contingent Payment Obligations The Group has entered into agreements with independent third parties for purchasing office and laboratory equipment. As of December 31, 2019, the Group had non-cancellable purchase commitments of $61,859. The Group has additional contingency payment obligations under each of the license agreements, such as milestone payments, royalties, research and development funding, if certain condition or milestone is met. Milestone payments are to be made upon achievements of certain conditions, such as Investigational New Drugs ("IND") filing or U.S. Food and Drug Administration ("FDA") approval, first commercial sale of the licensed products, or other achievements. The aggregate amount of the milestone payments that the Group are required to pay up to different achievements of conditions and milestones for all the license agreements signed as of December 31, 2019 are below: Amount Drug molecules: up to the conditions and milestones of Preclinical to IND filing $ 372,564 From entering phase 1 to before first commercial sale 24,216,410 First commercial sale 15,656,410 Net sales amount more than certain threshold in a year 75,769,231 Subtotal 116,014,615 Surgical robotics and medical devices: up to the conditions and milestones of Before FDA approval 270,000 FDA approval obtained 200,000 Subtotal 470,000 Total $ 116,484,615 For the years ended December 31, 2019 and 2018, and the period March 1, 2017 through December 31, 2017, the Group incurred $nil, $30,000 and $nil milestone payments, respectively. For the years ended December 31, 2019 and 2018, and the period March 1, 2017 through December 31, 2017, the Group did not incur any royalties or research and development funding, respectively. As of December 31, 2019, no other milestone payments had been triggered under any of the existing license agreements. |
Segment Reporting
Segment Reporting | 12 Months Ended |
Dec. 31, 2019 | |
Segment Reporting [Abstract] | |
SEGMENT REPORTING | 22. SEGMENT REPORTING The Group's chief operating decision maker, the Chief Executive Officer, reviews the consolidated results when making decisions about allocating resources and accessing performance of the Group as a whole and hence, the Group has only one reportable segment. The Group does not distinguish between markets or segments for the purpose of internal reporting. The Group's long-lived assets are substantially all located in Hong Kong and substantially all of the Group's expense is derived from within Hong Kong. Therefore, no geographical segments are presented. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2019 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | 23. SUBSEQUENT EVENTS The Group has evaluated subsequent events through the date of issuance of the consolidated financial statements, and except for the following events with material financial impact on the Group's consolidated financial statements, no other subsequent event is identified that would have required adjustment or disclosure in the consolidated financial statements. On January 14, 2020, Aptorum Group entered into a regional distribution agreement with Multipak Limited for the commercialization of its dietary supplement for women undergoing menopause and experiencing related symptoms. The dioscorea opposita bioactive nutraceutical tablets has commenced production in Canada and will be marketed under the brand name NativusWell TM On February 25, 2020, the Company entered into certain securities purchase agreement (the "Purchase Agreement") with certain non-affiliated institutional investors and Jurchen Investment Corporation, the ultimate parent of the Group, pursuant to which the Company agreed to sell total 1,351,350 Class A Ordinary Shares (the "Shares") and warrants ("Warrants") to purchase 1,351,350 of the Shares, for gross proceeds of approximately $10 million. The Warrants will be exercisable immediately following the date of issuance for a period of seven years at an initial exercise price of $7.40. The purchase price for each Share and the corresponding Warrant is $7.40. The Shares and Warrants were issued on February 28, 2020. Additionally, the Company issued 43,243 warrants to the placement agent on terms substantially the same as the Warrants except that the exercise price of the warrants issued to the Placement Agent was $8.88. On March 16, 2020, the Company granted 554,882 share options to employees, external consultants and advisors of the Group in accordance to the 2017 Share Option Plan with an exercise price of$2.99 per share. On January 30, 2020, the World Health Organization declared the coronavirus outbreak a "Public Health Emergency of International Concern" and on March 10, 2020, declared it to be a pandemic. Actions taken around the world to help mitigate the spread of the coronavirus include restrictions on travel, and quarantines in certain areas, and forced closures for certain types of public places and businesses. The coronavirus and actions taken to mitigate it have had and are expected to continue to have an adverse impact on the economies and financial markets of many countries, including the geographical area in which the Company operates. While the closures and limitations on movement, domestically and internationally, are expected to be temporary, if the outbreak continues on its current trajectory the duration of the supply chain disruption could reduce the availability, or result in delays, of materials or supplies to and from the Group, which in turn could materially interrupt the Group's business operations. Given the speed and frequency of the continuously evolving developments with respect to this pandemic, the Group cannot reasonably estimate the magnitude of the impact to its consolidated results of operations. Additionally, it is reasonably possible that estimates made in the financial statements have been, or will be, materially and adversely impacted in the near term as a result of these conditions, including losses on investments; impairment losses related to long-lived assets and current obligations. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Principles of presentation and consolidation | Principles of presentation and consolidation The consolidated financial statements are prepared in accordance with U.S. GAAP. Before March 1, 2017, the Company was an investment company under U.S. GAAP for the purposes of financial reporting. U.S. GAAP for an investment company requires investments to be recorded at estimated fair value and the unrealized gains and/or losses in an investment's fair value are recognized on a current basis in the statements of operations. In addition, the Company did not consolidate its subsidiaries, since they were operating companies and not investment companies. Such entities were fair valued in accordance with ASC Topic 946 ("ASC 946") and ASC Topic 820 ("ASC 820"). As of March 1, 2017, after the change of business purpose, legal form and substantive activities, the Company's status changed to an operating company from an investment company since it no longer met the criteria to qualify as an investment company under the ASC 946. The Company discontinued applying the guidance in ASC 946 and began to account for the change in status prospectively by accounting for its investments in accordance with other U.S. GAAP topics. This change in status and the accounting policies affect the comparability of the financial statements. As such, for the period January 1, 2017 through February 28, 2017, statements of operations, changes in net assets, and cash flows have been presented on the predecessor basis of accounting as an investment company, and on the successor basis of accounting as an operating company since March 1, 2017. The consolidated balance sheets as of December 31, 2019 and 2018 have been presented on the successor basis. The consolidated financial statements of the Group are presented on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") and include the accounts of the Company, its direct and indirect wholly and majority owned subsidiaries. All material intercompany balances and transactions have been eliminated in preparation of the consolidated financial statements. |
Non-controlling interests | Non-controlling interests Non-controlling interests represent the equity interests that are not attributable to the Group. |
Use of estimates | Use of estimates The preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements as well as income and expenses during the reporting period. Significant accounting estimates reflected in the Group's consolidated financial statements include valuation of equity securities, fair value of investments in securities, convertible debts and finance lease, the useful lives of intangible assets and property, plant and equipment, impairment of long-lived assets, valuation allowance for deferred tax assets, and collectability of receivables. Actual results could differ from those estimates. |
Foreign currency translation and transaction | Foreign currency translation and transaction USD is the reporting currency. The functional currency of subsidiaries in the Cayman Islands, Seychelles, Samoa and the United States are USD, the functional currency of subsidiaries in Hong Kong is Hong Kong Dollars ("HKD"), the functional currency of a subsidiary in Macao is Macanese Pataca ("MOP"), the functional currency of a subsidiary in the United Kingdom is Great British Pound ("GBP"), and the functional currency of subsidiaries in Singapore is Singapore Dollars ("SGD"). An entity's functional currency is the currency of the primary economic environment in which it operates, normally that is the currency of the environment in which it primarily generates and expends cash. The management considered various indicators, such as cash flows, market expenses, financing and inter-company transactions and arrangements in determining the Group's functional currency. In the consolidated financial statements, the financial information of the Company and its subsidiaries, which use HKD, MOP, GBP, and SGD as their functional currency, has been translated into USD. Assets and liabilities are translated from each subsidiary's functional currency at the exchange rates on the balance sheet dates, equity amounts are translated at historical exchange rates, and revenues, expenses, gains, and losses are translated using the average exchange rates for the year. Translation adjustments are reported as cumulative translation adjustments and are shown as a separate component of other comprehensive income or loss in the statements of operations and comprehensive loss. |
Cash | Cash Cash consists of cash on hand and bank deposits and cash denominated in foreign currencies, which is unrestricted as to withdraw and use. |
Restricted cash | Restricted cash Restricted cash represented a time deposit pledged for banking facilities or cash deposited into the escrow account from investors for the purpose of the subscription of convertible debts. |
Digital currencies | Digital currencies Digital currencies represented BitCoin, Ethereum, or other virtual currencies that the Group purchased and used to settle certain token related expenses. Digital currencies are included in current assets in the consolidated balance sheets. Digital currencies purchased are recorded at cost. Digital currencies held are accounted for as intangible assets with indefinite useful lives. An intangible asset with an indefinite useful life is not amortized but assessed for impairment annually, or more frequently, when events or changes in circumstances occur indicating that it is more likely than not that the indefinite-lived asset is impaired. Impairment exists when the carrying amount exceeds its fair value, which is measured using the quoted price of the digital currency at the time its fair value is being measured. In testing for impairment, the Group has the option to first perform a qualitative assessment to determine whether it is more likely than not that an impairment exists. If it is determined that it is not more likely than not that an impairment exists, a quantitative impairment test is not necessary. If the Company concludes otherwise, it is required to perform a quantitative impairment test. To the extent an impairment loss is recognized, the loss establishes the new cost basis of the asset. Subsequent reversal of impairment losses is not permitted. Purchases of digital currencies by the Group are included within investing activities in the consolidated statements of cash flows. The utilization of digital currencies in exchange of services are included within operating activities in the consolidated statements of cash flows and any gains or losses from such use are included in other income (expense) in the consolidated statements of operations. The Company accounts for its gains or losses in accordance with the first in first out (FIFO) method. |
Inventories | Inventories Inventories are stated at lower of cost and net realizable value. Cost is determined using the weighted average method. Where there is evidence that the utility of inventories, in their disposal in the ordinary course of business, will be less than cost, whether due to physical deterioration, obsolescence, changes in price levels, or other causes, the inventories are written down to net realizable value. |
Accounts receivable | Accounts receivable Accounts receivable are stated at the original amount less an allowance for doubtful receivables, if any, based on a review of all outstanding amounts at period end. An allowance is also made when there is objective evidence that the Group will not be able to collect all amounts due according to the original terms of the receivables. The Group analyzes the aging of the customer accounts, historical and current economic trends and the age of the receivables when evaluating the adequacy of the allowance for doubtful accounts. |
Marketable securities | Marketable securities Marketable securities are publicly traded stocks measured at fair value and classified within Level 1 and 2 in the fair value hierarchy because the Group uses quoted prices for identical assets in active markets or inputs that are based upon quoted prices for similar instruments in active markets. Loss on investments in marketable securities, net, amounted to $81,839, was recognized in the consolidated statements of operations for the year ended December 31, 2019. Gain on investments in marketable securities, net, amounted to $501,522 and $3,912,500, respectively, were recognized in the consolidated statements of operations for the year ended December 31, 2018 and the period March 1, 2017 through December 31, 2017. For the years ended December 31, 2019 and 2018, the Group disposed marketable securities, with sales proceeds of $999,110 and $637,582 received and recorded in due from brokers, respectively, and recognized a realized gain of $538,425 and $501,522 in the consolidated statements of operations, respectively. During the period March 1, 2017 to December 31, 2017, the Group disposed the trading securities and available-for-sale securities, with sales proceeds of $15,738,517 and $310,550 received, and recognized a gain of $3,917,046 and a loss of $4,546 on the consolidated statements of operations. |
Investments in derivatives | Investments in derivatives Investments in derivatives consisted of warrants, which are measured at fair value, with gains or losses from changes in fair value recorded through earnings. The fair value of these warrants have been determined using the Black-Scholes pricing mode. The Black-Scholes pricing model provides for assumptions regarding volatility, call and put features and risk-free interest rates within the total period to maturity. No disposal was recorded during the year ended December 31, 2019 and the period March 1, 2017 through December 31, 2017. For the year ended December 31, 2018, the Group disposed of warrants with proceeds of $4,957 received. Unrealized gain on the investments in derivatives amounted to $87,599 was recognized in the consolidated statements of operations for the year ended December 31, 2019. Unrealized loss on the investments in derivatives amounted to $974,444 and $827,501, respectively, were recognized in the consolidated statements of operations for the year ended December 31, 2018 and the period March 1, 2017 to December 31, 2017. |
Non-marketable investments | Non-marketable investments Non-marketable investments are comprising of investments in non-redeemable preferred shares of privately-held companies that are not required to be consolidated under the variable interest or voting models. Non-marketable investments are classified as non-current assets on the consolidated balance sheets as those investments do not have stated contractual maturity dates. The non-marketable equity securities not accounted for under the equity method are measured at cost, less any impairment, plus or minus changes resulting from observable price changes in orderly transactions for identical or similar investments of the same issuer. Adjustments are determined primarily based on a market approach as of the transaction date. |
Fair value measurement | Fair value measurement Fair value is defined as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required or permitted to be recorded at fair value, the Group considers the principal or most advantageous market in which it would transact its business, and it considers assumptions that market participants would use when pricing the asset or liability. As a basis for considering such assumptions, a three-tier fair value hierarchy prioritizes the inputs utilized in measuring fair value as follows: ● Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities. ● Level 2 applies to assets or liabilities for which there are inputs other than quoted prices included within Level 1 that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data. ● Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities. The hierarchy requires the Group to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument's categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The Group has estimated the fair value amounts of its financial instruments using the available market information and valuation methodologies considered to be appropriate and has determined that the carrying value of the Group's cash, restricted cash, accounts receivable, due from brokers, other receivables and prepayments, amounts due from/to related parties and accounts payable and accrued expenses as of December 31, 2019 and 2018 approximate fair value due to the short-term nature of these assets and liabilities. |
Property, plant and equipment | Property, plant and equipment Property, plant and equipment is stated at cost less accumulated depreciation and impairment losses. Cost represents the purchase price of the asset and other costs incurred to bring the asset into its existing use. Maintenance, repairs and betterments, including replacement of minor items, are charged to expense; major additions to physical properties are capitalized. Assets under construction are stated at cost less impairment losses. Cost comprises of cost of laboratory equipment delivered but not ready to be used, together with interest expense capitalized during the period of construction or installation and testing. Capitalization of these costs ceases and the asset concerned is transferred to the appropriate fixed assets category when substantially all the activities necessary to prepare the asset for its intended use are completed. Depreciation of property, plant and equipment is provided using the straight-line method over their estimated useful lives: Building 29 years Computer equipment 3 years Furniture, fixture, and office and medical equipment 5 years Leasehold improvements Shorter of the remaining lease terms or 5 years Laboratory equipment 5 years Motor vehicle 5 years Upon sale or disposal, the applicable amounts of asset cost and accumulated depreciation are removed from the accounts and the net amount less proceeds from disposal is charged or credited to income. |
Other non-current asset | Other non-current asset Other non-current asset represents laboratory supplies that can be used for more than one year. It is stated at cost less accumulated depreciation and impairment losses. Cost represents the purchase price of the supplies. Amortization of other non-current asset is provided using the straight-line method over their estimated useful lives. The amortization expenses for the years ended December 31, 2019 and 2018, and the period March 1, 2017 through December 31, 2017 are $59,834, $59,833 and $nil, respectively. |
Intangible assets | Intangible assets Indefinite-lived intangible assets are tested for impairment at least annually and are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Indefinite-lived intangible assets are impaired if their estimated fair values are less than their carrying values. Finite-lived intangible assets are carried at cost less accumulated amortization and impairment if any. The finite intangible assets are amortized over their estimated useful life, which is the period over which the assets are expected to contribute directly or indirectly to the future cash flows of the Group. These intangible assets are tested for impairment at the time of a triggering event, if one were to occur. Finite-lived intangible assets may be impaired when the estimated undiscounted future cash flows generated from the assets are less than their carrying amounts. The Group's intangible assets mainly consist of computer software, exclusive rights in prepaid patented and unpatented licenses. The prepaid patented licenses are for clinical purpose or further development into other products. Prepaid unpatented license is for further development, once the associated research and development efforts are completed, the prepaid unpatented license will be reclassified as a finite-lived asset and is amortized over its useful life. The estimated useful life of the exclusive rights in using patents is generally the remaining patent life from the acquisition date to expiration date under the law, which is 17 to 20 years, the Group will reassess the remaining patent life on annual basis, and the Group will assess the intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may no longer be recoverable. |
Impairment of long-lived assets | Impairment of long-lived assets The Group reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may no longer be recoverable. When these events occur, the Group measures impairment by comparing the carrying value of the long-lived assets to the estimated undiscounted future cash flows expected to result from the use of the assets and their eventual disposition. If the sum of the expected undiscounted cash flow is less than the carrying amount of the assets, the Group would recognize an impairment loss, which is the excess of carrying amount over the fair value of the assets, using the expected future discounted cash flows. |
Convertible debts | Convertible debts The Group determines the appropriate accounting treatment of its convertible debts in accordance with the terms in relation to the conversion feature, call and put option, beneficial conversion feature ("BCF") and settlement feature. After considering the impact of such features, the Group concluded that, the convertible debts contained a contingent beneficial conversion feature, which shall not be recognized in earnings until the contingency is resolved, and therefore accounted for such instrument as a liability in its entirety. Convertible debts were subsequently measured at amortized cost, using the effective interest rate method. Amortized cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the effective interest rate. The effective interest rate amortization is included in interest expense in the consolidated statements of operations. Management concluded that the contingency was effectively resolved upon the completion of the IPO on December 17, 2018 so that part of the convertible debts were converted automatically accordingly. The BCF derecognized upon automatic conversion was recorded as interest expense with a corresponding increase to additional paid-in capital. The remaining BCF was recorded as debt discount, which was amortized through the maturity of the convertible debts, with a corresponding increase to additional paid-in capital. On April 24, 2019, the Group repurchased its convertible debts at approximately $13.6 million with carrying amount of approximately $13.5 million and a gain on extinguishment on convertible debts of approximately $1.2 million was recognized. The repurchasing of convertible debts is considered an extinguishment and the difference between the repurchasing price of debt, the net carrying amount of the extinguished debt and the intrinsic value of BCF is recognized in the consolidated statements of operations. The intrinsic value of BCF of approximately $1.3 million at the extinguishment date was recorded as a reduction of additional paid-in capital. |
Finance lease | Finance lease Leases that transfer substantially all the rewards and risks of ownership of assets to the Group, other than legal title, are accounted for as finance leases. At the inception of a finance lease, the cost of the leased asset is capitalized at the present value of the minimum lease payments and recorded together with the obligation, excluding the interest element, to reflect the purchase and financing. Assets held under capitalized finance leases are included in property, plant and equipment, and depreciated over the shorter of the lease terms and the estimated useful lives of the assets. The interest expenses of such leases are charged to the consolidated statements of operations to provide a constant periodic rate of charge over the lease terms. |
Warrant liabilities | Warrant liabilities For warrants that are not indexed to the Group's shares, the Group records the fair value of the issued warrants as liabilities at each balance sheet date and records changes in the estimated fair value as a non-cash gain or loss in the consolidated statements of operations and comprehensive loss. The warrant liabilities are recognized in the consolidated balance sheets at the fair value (level 3). The fair value of these warrants have been determined using the Black-Scholes pricing mode. The Black-Scholes pricing model provides for assumptions regarding volatility, call and put features and risk-free interest rates within the total period to maturity. |
Revenue recognition | Revenue recognition Revenue is recognized when (or as) the Company satisfies performance obligations by transferring a promised goods or services to a customer. Revenue is measured at the transaction price which is based on the amount of consideration that the Company expects to receive in exchange for transferring the promised goods or services to the customer. Contracts with customers are comprised of invoices and written contracts. Revenue from healthcare services is measured upon the provision of the relevant services. |
Cost of healthcare service | Cost of healthcare service Cost of healthcare service rendered represents cost in relation to the medical services provided including the compensation of the physicians and cost of pharmaceutical supplies and medicine. |
Research and development expenses | Research and development expenses Research and development costs are expensed as incurred. Research and development expenses are comprised of costs incurred in performing research and development activities, including amortization of the patent license, depreciation of laboratory equipment, external costs of outside vendors engaged to conduct preclinical development activities and trials. |
Income taxes | Income taxes The Group accounts for income taxes under the asset and liability method. Under this method, deferred income taxes are determined based on differences between the financial carrying amounts of existing assets and liabilities and their tax bases. Income taxes are provided for in accordance with the laws of the relevant taxing authorities. A valuation allowance is provided for deferred tax assets if it is more likely than not that these items will either expire before the Group is able to realize their benefits, or that future deductibility is uncertain. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. |
Uncertain tax positions | Uncertain tax positions The Group accounts for uncertainty in income taxes using a two-step approach to recognizing and measuring uncertain tax positions. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount that is more than 50% likely of being realized upon settlement. Interest and penalties related to uncertain tax positions are recognized and recorded as necessary in the provision for income taxes. The Group recognizes interest on non-payment of income taxes and penalties associated with tax positions when a tax position does not meet more likely than not thresholds be sustained under examination. The tax returns of the Group's Hong Kong subsidiaries are subject to examination by the relevant tax authorities. According to the Hong Kong Inland Revenue Department, the statute of limitation is six years if any company chargeable with tax has not been assessed or has been assessed at less than the proper amount, the statute of limitation is extended to ten years if the underpayment of taxes is due to fraud or willful evasion. According to United Kingdom, Singapore, the United States and Samoa tax rule, trading losses are available to be carried forward indefinitely. According to the Seychelles tax rule, net operating losses are available to be carried forward for 5 years. The Group did not have any material interest or penalties associated with tax positions for the years ended December 31, 2019 and 2018, and the period March 1, 2017 through December 31, 2017, and did not have any significant unrecognized uncertain tax positions as of December 31, 2019 and 2018. The Group does not believe that its assessment regarding unrecognized tax benefits will materially change over the next twelve months. |
Comprehensive income or loss | Comprehensive income or loss U.S. GAAP generally requires that recognized revenue, expenses, gains and losses be included in net income or loss. Although certain changes in assets and liabilities are reported as separate components of the equity section of the consolidated balance sheets, such items, along with net income or loss, are components of comprehensive income or loss. The components of other comprehensive income or loss consist of exchange differences on translation of foreign operations. |
Loss per share | Loss per share Basic loss per share is computed by dividing net loss attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the period. Diluted loss per share reflects the potential dilution that could occur if securities or other contracts to issue ordinary shares were exercised or converted into ordinary shares. Potential dilutive securities are excluded from the calculation of diluted loss per share in loss periods as their effect would be anti-dilutive. |
Risks and Uncertainties | Risks and Uncertainties The Company is subject to a number of risks associated with companies at a similar stage, including dependence on key individuals, competition from similar services and larger companies, volatility of the industry, ability to obtain regulatory clearance, ability to obtain adequate financing to support growth, the ability to attract and retain additional qualified personnel to manage the anticipated growth of the Company and general economic conditions. |
Recently adopted accounting pronouncements | Recently adopted accounting pronouncements In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606) ("ASU 2014-09"), which was subsequently modified in August 2015 by ASU 2015-14, Revenue from Contracts with Customers: Deferral of the Effective Date. The Group adopted this standard effective January 1, 2019 using the modified retrospective approach, in which case the cumulative effect of applying the standard would be recognized at the date of initial application. The adoption does not have a material impact to the consolidated financial statements. In January 2016, the FASB issued Accounting Standards Update No. 2016-01 ("ASU 2016-01") "Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities," which amends various aspects of the recognition, measurement, presentation, and disclosure of financial instruments. The Group adopted ASU 2016-01 as of January 1, 2019 using the modified retrospective method for marketable equity securities and the prospective method for non-marketable equity securities. The following table summarizes the changes to the consolidated balance sheet for the adoption of ASU 2016-01: December 31, Adjustment January 1, Accumulated deficit $ (17,379,185 ) $ (1,490,033 ) $ (18,869,218 ) Accumulated other comprehensive loss $ (1,484,688 ) $ 1,490,033 $ 5,345 The Group has elected to use the measurement alternative for the non-marketable equity securities, defined as cost adjusted for changes from observable transactions for identical or similar investments of the same issuer, less impairment. The adoption of ASU 2016-01 increases the volatility of other income (expense), net, as a result of the unrealized gain or loss from the remeasurement of the Group's equity securities. |
Recently issued accounting standards which have not yet been adopted | Recently issued accounting standards which have not yet been adopted The Group is an "emerging growth company" as defined in the Jumpstart Our Business Startups Act of 2010 (the "JOBS Act"). Under the JOBS Act, the emerging growth companies ("EGCs") can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act until such time as those standards apply to private companies. In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses ("ASU 2016-13"). Subsequently, the FASB issued ASU 2019-05, Financial Instruments- Credit Losses (Topic 326): Targeted Transition Relief. The amendments in ASU 2016-13 update guidance on reporting credit losses for financial assets. These amendments affect loans, debt securities, accounts receivables, net investments in leases, off balance sheet credit exposures, reinsurance receivables, and any other financial assets not excluded from the scope that have the contractual right to receive cash. The amendments are effective for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years. As an EGC the Group can adopt the amendment for fiscal years beginning after December 15, 2021, and interim period within those fiscal years. The Group is currently evaluating the impact on its consolidated financial statements of adopting this standard. In February 2016, the FASB issued ASU 2016-02, Leases ("ASU 2016-02"), which requires a lessee to recognize a right-of-use asset and a lease liability for operating leases, initially measured at the present value of the future lease payments, in the balance sheet. ASU 2016-02 also requires a lessee to recognize a single lease cost, calculated so that the cost of the lease is allocated over the lease term, generally on a straight-line basis. This new guidance is effective for fiscal years beginning after December 15, 2019. Early adoption is permitted. The Group has evaluated the potential effects of adopting the provisions of ASU 2016-02 on its consolidated financial statements. The Group has estimated that the operating lease right-of-use assets of $959,641, and operating lease liabilities of $982,288 will be recognized at January 1, 2020 in the consolidated financial statements. In August 2018, the FASB issued ASU 2018-13, Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement, which amends ASC 820, Fair Value Measurement. This ASU modifies the disclosure requirements for fair value measurements by removing, modifying, or adding certain disclosures. The amendments are effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. The removed and modified disclosures will be adopted on a retrospective basis and the new disclosures will be adopted on a prospective basis. The adoption will not have a material effect on the Group's financial statements. In December 2019, the FASB issued Accounting Standards Update No. 2019-12, Income Taxes (Topic 740): "Simplifying the Accounting for Income Taxes" ("ASU 2019-12"), which simplifies the accounting for income taxes. This standard will be effective for fiscal years beginning after December 15, 2021, and interim periods within fiscal years beginning after December 15, 2022, on a prospective basis, and early adoption is permitted. The Group is currently evaluating the impact of the new standard on its consolidated financial statements. The Group does not believe other recently issued but not yet effective accounting standards, if currently adopted, would have a material effect on the consolidated financial position, statements of operations and cash flows. |
Organization (Tables)
Organization (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of subsidiaries | Name Incorporation Ownership Place of Principle activities Aptorum Therapeutics Limited June 30, 2016 100% Cayman Islands Research and development of life science and biopharmaceutical products APTUS MANAGEMENT LIMITED May 16, 2017 100% Hong Kong Provision of management services to its holding company and fellow subsidiaries Aptorum Medical Limited August 28, 2017 94% Cayman Islands Provision of medical clinic services Aptus Therapeutics (Hong Kong) Limited June 30, 2016 100% Hong Kong Research and development of life science and biopharmaceutical products Aptorum Pharmaceutical Development Limited August 28, 2017 100% Cayman Islands Research and development of life science and biopharmaceutical products Aptorum Innovations Holding Limited April 15, 2019 100% Cayman Islands Investment holding company Aptorum Innovations Holding Pte. Ltd. June 5, 2019 100% Singapore Research and development of life science and biopharmaceutical products Aptorum Investment Holding Limited March 29, 2019 100% Cayman Islands Investment holding company Acticule Life Sciences Limited June 30, 2017 80% Cayman Islands Research and development of life science and biopharmaceutical products Claves Life Sciences Limited August 2, 2017 100% Cayman Islands Research and development of life science and biopharmaceutical products Nativus Life Sciences Limited July 7, 2017 100% Cayman Islands Research and development of life science and biopharmaceutical products Videns Incorporation Limited March 2, 2017 100% Cayman Islands Research and development of life science and biopharmaceutical products mTOR (Hong Kong) Limited November 4, 2016 90% Hong Kong Research and development of life science and biopharmaceutical products Scipio Life Sciences Limited July 19, 2017 100% Cayman Islands Research and development of life science and biopharmaceutical products Signate Life Sciences Limited August 28, 2017 100% Cayman Islands Research and development of life science and biopharmaceutical products SMTPH Limited April 18, 2019 100% Seychelles Investment holding company Smart Pharmaceutical Research Limited April 24, 2019 100% Samoa Pharmaceutical research and analysis Smart Pharmaceutical Development Pte. Limited May 10, 2019 100% Singapore Research and development of life science and biopharmaceutical products Smart Pharmaceutical Limited Partnership June 7, 2019 100% Seychelles Issuance of asset backed securities |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Schedule of estimated useful lives | Building 29 years Computer equipment 3 years Furniture, fixture, and office and medical equipment 5 years Leasehold improvements Shorter of the remaining lease terms or 5 years Laboratory equipment 5 years Motor vehicle 5 years |
Schedule of the changes to the consolidated balance sheet | December 31, Adjustment January 1, Accumulated deficit $ (17,379,185 ) $ (1,490,033 ) $ (18,869,218 ) Accumulated other comprehensive loss $ (1,484,688 ) $ 1,490,033 $ 5,345 |
Fair Value Measurement (Tables)
Fair Value Measurement (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Schedule of assets and liabilities carried at fair value measured on a recurring basis | December 31, 2019 Level 1 Level 2 Level 3 Total Current Assets Marketable securities Common stocks $ 806,778 $ 256,333 $ - $ 1,063,111 Investments in derivatives Warrants - - 203,320 203,320 Total assets at fair value $ 806,778 $ 256,333 $ 203,320 $ 1,266,431 December 31, 2018 Level 1 Level 2 Level 3 Total Current Assets Marketable securities – Available-for-sale securities Common stocks $ 813,728 $ 200,610 $ - $ 1,014,338 Investments in derivatives Warrants - - 115,721 115,721 Total assets at fair value $ 813,728 $ 200,610 $ 115,721 $ 1,130,059 |
Schedule of fair value reconciliation of Level 3 assets | Warrants Balance at January 1, 2019 $ 115,721 Change in unrealized appreciation 87,599 Balance at December 31, 2019 $ 203,320 Net change in unrealized appreciation relating to investments still held at December 31, 2019 87,599 Warrants Balance at January 1, 2018 $ 1,070,940 Change in unrealized depreciation (955,219 ) Balance at December 31, 2018 $ 115,721 Net change in unrealized depreciation relating to investments still held at December 31, 2018 (955,219 ) |
Schedule of reconciliation of level 3 assets | Aptorum Common Preferred Warrants Convertible Total Balance at February 28, 2017 $ 757,647 $ 7,920,000 $ 4,314,998 $ 1,907,470 $ 3,082,020 $ 17,982,135 Transfer out of Level 3 due to change in status – consolidated subsidiary (a) (757,647 ) - - - - (757,647 ) Transfer out of fair value leveling since recorded as cost method (b) - (7,920,000 ) (4,314,998 ) - - (12,234,998 ) Balance at March 1, 2017 $ - $ - $ - $ 1,907,470 $ 3,082,020 $ 4,989,490 Reclassification between different investment type (c) - - 3,079,715 - (3,079,715 ) - Transfer out of fair value leveling since recorded as cost method (c) - - (3,079,715 ) - - (3,079,715 ) Change in unrealized depreciation - - - (836,530 ) (2,305 ) (838,835 ) Balance at December 31, 2017 $ - $ - $ - $ 1,070,940 $ - $ 1,070,940 Net change in unrealized depreciation relating to investments still held at December 31, 2017 - - - (836,530 ) - (836,530 ) a. Upon the effective date of the change in status, March 1, 2017, the subsidiaries were no longer recognized at fair value and were instead consolidated when preparing the financial statements. b. The equity investments of common stock and preferred stock were non-marketable investments under cost method upon change in status. Subsequently, Athenex Inc. was listed on the NASDAQ stock exchange on June 14, 2017 and common stock with an amount of $7,920,000 has been transferred to common stock in Level 1 with amount of $7,920,000, which was subsequently sold in December 2017 with a gain from the marketable securities of $3,722,234 recognized. c. On March 9, 2017, the convertible promissory notes (including its accrued interest, totally $520,822) of Centrexion Therapeutics Corporation was converted into preferred stock (Series C) of the same company. On May 25, 2017, the convertible promissory notes (including its accrued interest, totaling $2,558,893) of Alzheon Inc., was converted into preferred stock (Series B) of the same company. The preferred stocks are considered non-marketable investments and were therefore reclassified out of the fair value hierarchy to be reported under cost method. |
Schedule of quantitative information about the group’s level 3 fair value measurements of investment | December 31, Valuation technique Unobservable input Range (weighted average) Sensitivity of fair value to input Warrants Black-Scholes Model Estimated time to exit Historical Volatility 12-18 months 73% - 301% 10% increase (decrease) in volatility would result in increase (decrease) in fair value by $17,871 December 31, Valuation technique Unobservable input Range (weighted average) Sensitivity of fair value to input Warrants Black-Scholes Model Estimated time to exit Historical Volatility 12-30 months 73% - 188% 10% increase (decrease) in volatility would result in increase (decrease) in fair value by $19,691 |
Schedule of derivative activities based on their notional amount and number of contracts | Long Exposure December 31, 2019 December 31, 2018 Primary underlying risk Notional Number of Contracts Notional Amounts Number of Contracts Equity Price Warrants $ 265,576 2,234,373 $ 218,270 2,257,682 |
Schedule of fair value amounts of derivative instruments included in the consolidated balance sheets | December 31, December 31, Primary underlying risk Derivative Derivative Derivative Derivative Equity Price Warrants $ 203,320 $ - $ 115,721 $ - Year ended Year ended March 1, 2017 through December 31, 2017 Primary underlying risk Realized Unrealized Realized Unrealized Realized Unrealized Equity Price Warrants $ - $ 87,599 $ (19,225 ) $ (955,219 ) $ (7,094 ) $ (820,407 ) |
Schedule of unrealized gains and losses | Year ended Upward adjustments $ 1,017,468 Total unrealized gain for non-marketable investments $ 1,017,468 |
Schedule of carrying value of our non-marketable investments | December 31, Initial cost basis $ 6,094,712 Upward adjustments 1,017,468 Total carrying value at the end of the period $ 7,112,180 |
Other Receivables and Prepaym_2
Other Receivables and Prepayments (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Receivables [Abstract] | |
Schedule of other receivables and prepayments | December 31, December 31, Prepaid insurance $ 154,011 $ 147,864 Prepaid service fee 296,565 75,224 Rental deposits 8,584 8,576 Prepaid rental expenses 37,169 46,948 Prepaid research and development expenses 453,634 41,614 Other receivables 109,714 109,435 Others 19,366 34,495 $ 1,079,043 $ 464,156 |
Digital Currencies (Tables)
Digital Currencies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Digital Currencies [Abstract] | |
Schedule of additional information about digital currencies | December 31, December 31, Beginning balance $ - $ - Purchase of digital currencies 200,000 - Utilization of digital currencies to settle service fee (245,178 ) - Gain on use of digital currencies 46,717 - Ending balance $ 1,539 $ - |
Property, Plant and Equipment_2
Property, Plant and Equipment, Net (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property, plant and equipment | December 31, 2019 December 31, 2018 Building $ 1,488,396 $ 1,488,396 Computer equipment 76,365 64,911 Furniture, fixture, and office and medical equipment 271,009 262,819 Leasehold improvements 665,546 664,713 Laboratory equipment 4,029,640 2,045,034 Motor vehicle 239,093 239,093 Assets in construction 1,899,169 - 8,669,218 4,764,966 Less: accumulated depreciation 1,576,183 504,364 Property, plant and equipment, net $ 7,093,035 $ 4,260,602 |
Intangible Assets, Net (Tables)
Intangible Assets, Net (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of intangible assets | December 31, December 31, 2018 Gross carrying amount Prepaid unpatented license $ 200,000 $ 200,000 Prepaid patented licenses 1,322,820 1,322,820 Computer software 97,462 61,384 1,620,282 1,584,204 Less: accumulated amortization Prepaid patented licenses 257,619 155,026 Computer software 50,980 19,638 308,599 174,664 Intangible assets, net Prepaid unpatented license 200,000 200,000 Prepaid patented licenses 1,065,201 1,167,794 Computer software 46,482 41,746 Intangible assets, net $ 1,311,683 $ 1,409,540 |
Schedule of amortization expense related to its finite-lived intangible assets | For the years ending December 31, Amount 2020 $ 146,826 2021 104,842 2022 102,593 2023 102,593 2024 97,099 Thereafter 557,730 Total $ 1,111,683 |
Long-Term Deposits (Tables)
Long-Term Deposits (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of long-term deposits | December 31, December 31, 2018 Rental deposits $ 132,043 $ 132,043 Prepayments for equipment 162,563 3,285,135 $ 294,606 $ 3,417,178 |
Accounts Payable and Accrued _2
Accounts Payable and Accrued Expenses (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Accounts Payable and Accrued Liabilities, Current [Abstract] | |
Schedule of accounts payable and accrued expenses | December 31, December 31, 2018 Research and development expenses payable $ 554,791 $ 398,899 Cost of healthcare services payable 45,234 40,139 Professional fees payable 171,037 178,117 Insurance expense payable 70,811 - Interest payable 8,802 223,802 Payables for leasehold improvement and equipment 26,779 73,864 Deferred bonus and salaries payable 1,570,324 183,065 Deferred rent 55,484 58,810 Others 83,265 90,451 $ 2,586,527 $ 1,247,147 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Schedule of provision for income taxes expenses | Year ended December 31, 2019 Year ended December 31, 2018 March 1, 2017 Current $ - $ - $ - Deferred - - - Total income taxes expense $ - $ - - |
Schedule of income taxes expenses computed at the Hong Kong statutory tax rate | Year ended Year ended March 1, Net loss before tax $ (20,116,938 ) $ (15,134,485 ) $ (2,561,507 ) Provision for income taxes at Hong Kong statutory income tax rate (16.5%) (3,319,294 ) (2,497,190 ) (422,649 ) Impact of different tax rates in other jurisdictions (91,623 ) (3,066 ) - Non-taxable income (389,714 ) (95,018 ) - Non-deductible expenses 702,433 540,893 - Prior year tax effect - - (576,970 ) Change in valuation allowance 3,098,198 2,054,381 999,619 Effective income tax expense $ - $ - $ - |
Scgedule of deferred tax asset | December 31, December 31, Deferred tax asset: Tax loss carry forward $ 6,699,345 $ 3,499,428 Deferred tax liability: Depreciation and amortization (547,147 ) (445,428 ) Net deferred tax assets before valuation allowance 6,152,198 3,054,000 Valuation allowance (6,152,198 ) (3,054,000 ) Deferred tax asset, net $ - $ - |
Related Party Balances and Tr_2
Related Party Balances and Transactions (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Related Party Transactions [Abstract] | |
Schedule of due (from) to related parties | December 31, December 31, Current Aeneas Management Limited $ 962 $ - AENEAS CAPITAL LIMITED - 169,051 Total $ 962 $ 169,051 Non-current Jurchen Investment Corporation (Note e) 50,000 50,000 December 31, December 31, Current Aenco Solutions Limited $ 5,782 $ - Aeneas Group Limited 14,247 - Jurchen Investment Corporation 20,055 - Ian Huen 127 2,545 Clark Cheng 1,114 8,893 Sabrina Khan 268 21,979 Total $ 41,593 $ 33,417 Non-current Aeneas Group Limited (Note a) $ 3,330,472 $ - Jurchen Investment Corporation (Note a) 3,000,000 - 6,330,472 - |
Schedule of related party transactions | Year ended Year ended March 1, Borrowings from related parties (Note a) - Aeneas Group Limited $ 3,330,472 $ - $ - - Jurchen Investment Corporation $ 3,000,000 $ - $ - Interest expenses (Note a) - Aeneas Group Limited $ 14,247 $ - $ - - Jurchen Investment Corporation $ 20,055 $ - $ - Payments on behalf of the Group (Note b) - AENEAS CAPITAL LIMITED $ 5,057 $ - $ 64,038 - Aeneas Management Limited $ 5,372 $ 156,961 $ - - Aenco Solutions Limited $ 186,671 $ - $ - Prepayments to related parties (Note b) - Aenco Solutions Limited $ 200,000 $ - $ - Expense reimbursement (Note b) - AENEAS CAPITAL LIMITED $ 5,057 $ 7,331 $ 66,881 - Aeneas Management Limited $ 5,372 $ 156,961 $ - Payments on behalf of related parties (Note c) - AENEAS CAPITAL LIMITED $ - $ 22,934 $ 109,025 - Aeneas Limited $ - $ - $ 132,074 - Aeneas Group Limited $ - $ - $ 1,853 Repayments from related parties (Note c) - AENEAS CAPITAL LIMITED $ 169,051 $ 132,128 $ - - Aeneas Limited $ - $ 190,427 $ - - Aeneas Group Limited $ - $ 7,451 $ - Healthcare services income - Aeneas Management Limited $ 1,923 $ - $ - Consultant, management and administrative fees (Note d) - AENEAS CAPITAL LIMITED $ - $ 448,718 $ 640,932 - Aeneas Management Limited $ 698,152 $ - $ - - Aenco Limited $ 830,769 $ - $ - Rental expense(Note e) - Jurchen Investment Corporation $ 227,729 $ 207,841 $ - Payment for rental deposit (Note e) - Jurchen Investment Corporation $ - $ 50,000 $ - Tokens maintenance fee (Note b) - Aenco Solutions Limited $ 67,876 $ - $ - Issuance of tokens for tokens creation, offering and consultancy services (Note f) - Aenco Solutions Limited $ 300,000 $ - $ - Tokens creation, offering and consultancy services expense (Note f) - Aenco Solutions Limited $ 192,000 $ - $ - Prepayment of tokens consultancy services (Note f) - Aenco Solutions Limited $ 108,000 $ - $ - A borrowing from a related party (Note g) - Ian Huen $ - $ - $ 6,410 |
Convertible Debts (Tables)
Convertible Debts (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of components of the ending balance of convertible debts | December 31, 2019 December 31, 2018 Gross convertible debts $ - $ 13,500,000 Less: Discount on issuance cost - 314,744 Discount on BCF - 3,077,950 Convertible debts, net $ - $ 10,107,306 |
Finance Lease (Tables)
Finance Lease (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Finance Lease | |
Schedule of components of capital leases obligation | December 31, December 31, Gross finance lease obligation $ 157,047 $ 210,891 Less: Discount on finance lease obligation 13,173 23,141 143,874 187,750 Less: Current portion of finance lease obligation 46,555 43,877 Net present value of finance lease obligation, net of current portion $ 97,319 $ 143,873 |
Schedule of net minimum payments on capital lease | 2020 2021 2022 Total Minimum lease payments $ 53,845 $ 53,845 $ 49,357 $ 157,047 Less: Amortization of discount 7,290 4,449 1,434 13,173 Finance lease obligation $ 46,555 $ 49,396 $ 47,923 $ 143,874 |
Share Based Compensation (Table
Share Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of the option activity | Number of share options Weighted average exercise Remaining contractual term in years Outstanding, January 1, 2019 - - - Granted 218,222 12.91 12.31 Outstanding, December 31, 2019 218,222 12.91 11.51 Exercisable, December 31, 2019 - - - |
Schedule of each stock option award is estimated on the date of grant using the Black-Scholes option pricing model | Date of grant Expected volatility 95.02%-95.15% Risk-free interest rate 2.46%-2.49% Expected term from grant date (in years) 6.29-7.29 Dividend rate - Dilution factor 0.9962 Fair value $10.10-10.52 |
Warrants (Tables)
Warrants (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Warrants [Abstract] | |
Schedule of loss in changes in fair value of warrant liabilities was recorded in consolidated statements of operations | December 31, December 31, Expected volatility - % 58.18 % Risk-free interest rate - 2.820%-2.822% Expected term from grant date (in years) - 2.43 Dividend rate - - Fair value $ - $ 4.60-9.48 |
Schedule for movement of the warrants | Warrants Weighted Average Exercise Price Weighted Average Remaining Contractual Term in Years Outstanding, January 1, 2019 118,524 $ 13.79 2.43 Exercised 118,524 $ 13.79 1.96 Outstanding, December 31, 2019 - $ - - Outstanding, January 1, 2018 - $ - - Granted 118,524 $ 13.79 2.50 Outstanding, December 31, 2018 118,524 $ 13.79 2.43 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |
Schedule of basic and diluted loss per share | Year ended December 31, Year ended December 31, March 1, 2017 through December 31, 2017 Numerator: Net loss attributable to Aptorum Group Limited $ (18,686,762 ) $ (14,831,723 ) $ (2,547,462 ) Denominator: Basic and diluted weighted average common shares outstanding 29,008,445 27,909,788 26,963,435 Basic and diluted loss per share $ (0.64 ) $ (0.53 ) $ (0.09 ) |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of total future minimum lease payments under the non-cancellable operating leases | For the years ending December 31, Amount 2020 $ 597,198 2021 397,842 2022 75,174 2023 - 2024 and thereafter - Total $ 1,070,214 |
Schedule of milestone payments are to be made upon achievements of certain conditions | Amount Drug molecules: up to the conditions and milestones of Preclinical to IND filing $ 372,564 From entering phase 1 to before first commercial sale 24,216,410 First commercial sale 15,656,410 Net sales amount more than certain threshold in a year 75,769,231 Subtotal 116,014,615 Surgical robotics and medical devices: up to the conditions and milestones of Before FDA approval 270,000 FDA approval obtained 200,000 Subtotal 470,000 Total $ 116,484,615 |
Organization (Details)
Organization (Details) | 12 Months Ended |
Dec. 31, 2019 | |
Aptorum Therapeutics Limited [Member] | |
Incorporation date | Jun. 30, 2016 |
Ownership | 100.00% |
Place of incorporation | Cayman Islands |
Principle activities | Research and development of life science and biopharmaceutical products |
APTUS MANAGEMENT LIMITED [Member] | |
Incorporation date | May 16, 2017 |
Ownership | 100.00% |
Place of incorporation | Hong Kong |
Principle activities | Provision of management services to its holding company and fellow subsidiaries |
Aptus Therapeutics (Hong Kong) Limited [Member] | |
Incorporation date | Jun. 30, 2016 |
Ownership | 100.00% |
Place of incorporation | Hong Kong |
Principle activities | Research and development of life science and biopharmaceutical products |
Aptorum Medical Limited [Member] | |
Incorporation date | Aug. 28, 2017 |
Ownership | 94.00% |
Place of incorporation | Cayman Islands |
Principle activities | Provision of medical clinic services |
Videns Incorporation Limited [Member] | |
Incorporation date | Mar. 2, 2017 |
Ownership | 100.00% |
Place of incorporation | Cayman Islands |
Principle activities | Research and development of life science and biopharmaceutical products |
mTOR (Hong Kong) Limited [Member] | |
Incorporation date | Nov. 4, 2016 |
Ownership | 90.00% |
Place of incorporation | Hong Kong |
Principle activities | Research and development of life science and biopharmaceutical products |
Nativus Life Sciences Limited [Member] | |
Incorporation date | Jul. 7, 2017 |
Ownership | 100.00% |
Place of incorporation | Cayman Islands |
Principle activities | Research and development of life science and biopharmaceutical products |
Scipio Life Sciences Limited [Member] | |
Incorporation date | Jul. 19, 2017 |
Ownership | 100.00% |
Place of incorporation | Cayman Islands |
Principle activities | Research and development of life science and biopharmaceutical products |
Claves Life Sciences Limited [Member] | |
Incorporation date | Aug. 2, 2017 |
Ownership | 100.00% |
Place of incorporation | Cayman Islands |
Principle activities | Research and development of life science and biopharmaceutical products |
Aptorum Pharmaceutical Development Limited [Member] | |
Incorporation date | Aug. 28, 2017 |
Ownership | 100.00% |
Place of incorporation | Cayman Islands |
Principle activities | Research and development of life science and biopharmaceutical products |
Signate Life Sciences Limited [Member] | |
Incorporation date | Aug. 28, 2017 |
Ownership | 100.00% |
Place of incorporation | Cayman Islands |
Principle activities | Research and development of life science and biopharmaceutical products |
Acticule Life Sciences Limited [Member] | |
Incorporation date | Jun. 30, 2017 |
Ownership | 80.00% |
Place of incorporation | Cayman Islands |
Principle activities | Research and development of life science and biopharmaceutical products |
SMTPH Limited [Member] | |
Incorporation date | Apr. 18, 2019 |
Ownership | 100.00% |
Place of incorporation | Seychelles |
Principle activities | Investment holding company |
Smart Pharmaceutical Research Limited [Member] | |
Incorporation date | Apr. 24, 2019 |
Ownership | 100.00% |
Place of incorporation | Samoa |
Principle activities | Pharmaceutical research and analysis |
Smart Pharmaceutical Development Pte. Limited [Member] | |
Incorporation date | May 10, 2019 |
Ownership | 100.00% |
Place of incorporation | Singapore |
Principle activities | Research and development of life science and biopharmaceutical products |
Smart Pharmaceutical Limited Partnership [Member] | |
Incorporation date | Jun. 7, 2019 |
Ownership | 100.00% |
Place of incorporation | Seychelles |
Principle activities | Issuance of asset backed securities |
Aptorum Innovations Holding Limited [Member] | |
Incorporation date | Apr. 15, 2019 |
Ownership | 100.00% |
Place of incorporation | Cayman Islands |
Principle activities | Investment holding company |
Aptorum Innovations Holding Pte. Ltd. [Member] | |
Incorporation date | Jun. 5, 2019 |
Ownership | 100.00% |
Place of incorporation | Singapore |
Principle activities | Research and development of life science and biopharmaceutical products |
Aptorum Investment Holding Limited [Member] | |
Incorporation date | Mar. 29, 2019 |
Ownership | 100.00% |
Place of incorporation | Cayman Islands |
Principle activities | Investment holding company |
Organization (Details Textual)
Organization (Details Textual) - IPO [Member] - USD ($) | 1 Months Ended | ||
Dec. 17, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | |
Organization (Textual) | |||
Initial public offering, description | The Group completed an initial public offering (the "IPO" or "Offering") with new issuance of 761,419 ordinary shares at $15.80 for total offering size of approximately $12.0 million before deducting commissions and expenses. The net proceeds from the IPO was approximately $10.3 million, net off underwriting discount of approximately $1.2 million and offering costs of approximately $0.5 million. | ||
Deferred offering costs | |||
Offering costs charged to additional paid in capital | $ 1,732,370 | $ 1,732,229 |
Liquidity (Details)
Liquidity (Details) - USD ($) | 10 Months Ended | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | |
Liquidity (Textual) | |||
Net loss | $ (2,561,507) | $ (20,116,938) | $ (15,134,485) |
Accumulated deficit | (37,555,980) | (17,379,185) | |
Net operation cash outflow | $ (5,782,695) | (13,382,633) | $ (10,035,531) |
Unrestricted cash | 6,300,000 | ||
Working capital | 5,358,206 | ||
Line of Credit [Member] | |||
Liquidity (Textual) | |||
Related parties | $ 12,400,000 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details) | 12 Months Ended |
Dec. 31, 2019 | |
Building [Member] | |
Estimated useful lives | 29 years |
Computer equipment [Member] | |
Estimated useful lives | 3 years |
Furniture, fixture, and office and medical equipment [Member] | |
Estimated useful lives | 5 years |
Leasehold improvements [Member] | |
Leasehold improvements, estimated useful lives | Shorter of the remaining lease terms or 5 years |
Laboratory equipment [Member] | |
Estimated useful lives | 5 years |
Motor vehicle [Member] | |
Estimated useful lives | 5 years |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies (Details 1) | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Accumulated deficit | |
December 31, 2018 | $ (17,379,185) |
Adjustment due to ASU 2016-01 | (1,490,033) |
January 1, 2019 | (18,869,218) |
Accumulated other comprehensive loss | |
December 31, 2018 | (1,484,688) |
Adjustment due to ASU 2016-01 | 1,490,033 |
January 1, 2019 | $ 5,345 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies (Details Textual) - USD ($) | 1 Months Ended | 10 Months Ended | 12 Months Ended | |||
Apr. 24, 2019 | Apr. 24, 2019 | Dec. 31, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | Jan. 01, 2020 | |
Summary of Significant Accounting Policies (Textual) | ||||||
Gains from the marketable securities | $ 3,912,500 | $ (81,839) | $ 501,522 | |||
Available-for-sale securities sales proceeds | 999,110 | 637,582 | ||||
Recognized a gain on sale of securities | 538,425 | 501,522 | ||||
Unrealized gain on the investments in derivatives amounted | 87,599 | |||||
Unrealized loss on the investments in derivatives amounted | 827,501 | 974,444 | ||||
Trading securities and available-for-sale securities, sales proceeds | 15,738,517 | |||||
Trading securities and available-for-sale securities, received | 310,550 | |||||
Trading securities and available-for-sale securities, recognized gain | 3,917,046 | |||||
Trading securities and available-for-sale securities, recognized loss | 4,546 | |||||
Group disposed of warrants with proceeds | 4,957 | |||||
Amortization expenses | 59,834 | 59,833 | ||||
Convertible debts with carrying amount | $ 13,500,000 | $ 13,500,000 | ||||
Gain on extinguishment on convertible debts | 1,200,000 | 1,200,000 | 1,198,490 | |||
Intrinsic value | 1,300,000 | 1,300,000 | $ 1,300,000 | |||
Group repurchased its convertible debts | $ 13,600,000 | $ 13,600,000 | ||||
Operating losses are available to be carried forward | 5 years | |||||
Measure the tax benefit | 50.00% | |||||
Subsequent Event [Member] | ||||||
Summary of Significant Accounting Policies (Textual) | ||||||
Operating lease right-of-use assets | $ 959,641 | |||||
Operating lease liabilities | $ 982,288 | |||||
Computer software [Member] | Minimum [Member] | ||||||
Summary of Significant Accounting Policies (Textual) | ||||||
useful life intangible assets | 17 years | |||||
Computer software [Member] | Maximum [Member] | ||||||
Summary of Significant Accounting Policies (Textual) | ||||||
useful life intangible assets | 20 years |
Fair Value Measurement (Details
Fair Value Measurement (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 | Jun. 14, 2017 |
Assets Investments in securities | |||
Total assets at fair value | $ 1,266,431 | $ 1,130,059 | $ 7,920,000 |
Common stocks [Member] | |||
Assets Investments in securities | |||
Total assets at fair value | 1,063,111 | 1,014,338 | |
Warrants [Member] | |||
Assets Investments in securities | |||
Total assets at fair value | 203,320 | 115,721 | |
Level 1 [Member] | |||
Assets Investments in securities | |||
Total assets at fair value | 806,778 | 813,728 | $ 7,920,000 |
Level 1 [Member] | Common stocks [Member] | |||
Assets Investments in securities | |||
Total assets at fair value | 806,778 | 813,728 | |
Level 1 [Member] | Warrants [Member] | |||
Assets Investments in securities | |||
Total assets at fair value | |||
Level 2 [Member] | |||
Assets Investments in securities | |||
Total assets at fair value | 256,333 | 200,610 | |
Level 2 [Member] | Common stocks [Member] | |||
Assets Investments in securities | |||
Total assets at fair value | 256,333 | 200,610 | |
Level 2 [Member] | Warrants [Member] | |||
Assets Investments in securities | |||
Total assets at fair value | |||
Level 3 [Member] | |||
Assets Investments in securities | |||
Total assets at fair value | 203,320 | 115,721 | |
Level 3 [Member] | Common stocks [Member] | |||
Assets Investments in securities | |||
Total assets at fair value | |||
Level 3 [Member] | Warrants [Member] | |||
Assets Investments in securities | |||
Total assets at fair value | $ 203,320 | $ 115,721 |
Fair Value Measurement (Detai_2
Fair Value Measurement (Details 1) - Level 3 [Member] - Warrants [Member] - Fair value recurring [Member] - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Beginning balance | $ 115,721 | $ 1,070,940 |
Change in unrealized appreciation (depreciation) | 87,599 | (955,219) |
Ending Balance | 203,320 | 115,721 |
Net change in unrealized depreciation relating to investments still held at December 31, 2018 | $ 87,599 | $ (955,219) |
Fair Value Measurement (Detai_3
Fair Value Measurement (Details 2) | 10 Months Ended | |
Dec. 31, 2017USD ($) | ||
Level 3 assets [Member] | ||
Beginning balance | $ 4,989,490 | |
Reclassification between different investment type | [1] | |
Transfer out of fair value leveling since recorded as cost method | (3,079,715) | [1] |
Change in unrealized depreciation | (838,835) | |
Ending Balance | 1,070,940 | |
Net change in unrealized depreciation relating to investments still held at December 31, 2017 | (836,530) | |
Level 3 assets [Member] | February 28, 2017 [Member] | ||
Beginning balance | 17,982,135 | |
Transfer out of Level 3 due to change in status - consolidated subsidiary | (757,647) | [2] |
Reclassification between different investment type | ||
Transfer out of fair value leveling since recorded as cost method | (12,234,998) | [3] |
Convertible notes [Member] | ||
Beginning balance | 3,082,020 | |
Reclassification between different investment type | (3,079,715) | [1] |
Transfer out of fair value leveling since recorded as cost method | [1] | |
Change in unrealized depreciation | (2,305) | |
Ending Balance | ||
Net change in unrealized depreciation relating to investments still held at December 31, 2017 | ||
Convertible notes [Member] | February 28, 2017 [Member] | ||
Beginning balance | 3,082,020 | |
Transfer out of Level 3 due to change in status - consolidated subsidiary | [2] | |
Transfer out of fair value leveling since recorded as cost method | 3,082,020 | [3] |
Common Stock | ||
Beginning balance | ||
Reclassification between different investment type | [1] | |
Transfer out of fair value leveling since recorded as cost method | [1] | |
Change in unrealized depreciation | ||
Ending Balance | ||
Net change in unrealized depreciation relating to investments still held at December 31, 2017 | ||
Common Stock | February 28, 2017 [Member] | ||
Beginning balance | 7,920,000 | |
Transfer out of Level 3 due to change in status - consolidated subsidiary | [2] | |
Transfer out of fair value leveling since recorded as cost method | (7,920,000) | [3] |
Preferred Stock | ||
Beginning balance | ||
Reclassification between different investment type | 3,079,715 | [1] |
Transfer out of fair value leveling since recorded as cost method | (3,079,715) | [1] |
Change in unrealized depreciation | ||
Ending Balance | ||
Net change in unrealized depreciation relating to investments still held at December 31, 2017 | ||
Preferred Stock | February 28, 2017 [Member] | ||
Beginning balance | 4,314,998 | |
Transfer out of Level 3 due to change in status - consolidated subsidiary | [2] | |
Transfer out of fair value leveling since recorded as cost method | (4,314,998) | [3] |
Warrants [Member] | ||
Beginning balance | 1,907,470 | |
Reclassification between different investment type | [1] | |
Transfer out of fair value leveling since recorded as cost method | [1] | |
Change in unrealized depreciation | (836,530) | |
Ending Balance | 1,070,940 | |
Net change in unrealized depreciation relating to investments still held at December 31, 2017 | (836,530) | |
Warrants [Member] | February 28, 2017 [Member] | ||
Beginning balance | 1,907,470 | |
Transfer out of Level 3 due to change in status - consolidated subsidiary | [2] | |
Transfer out of fair value leveling since recorded as cost method | 1,907,470 | [3] |
Aptorum Therapeutics - related party [Member] | ||
Beginning balance | ||
Reclassification between different investment type | [1] | |
Transfer out of fair value leveling since recorded as cost method | [1] | |
Change in unrealized depreciation | ||
Ending Balance | ||
Net change in unrealized depreciation relating to investments still held at December 31, 2017 | ||
Aptorum Therapeutics - related party [Member] | February 28, 2017 [Member] | ||
Beginning balance | 757,647 | |
Transfer out of Level 3 due to change in status - consolidated subsidiary | [2] | |
Transfer out of fair value leveling since recorded as cost method | [3] | |
[1] | On March 9, 2017, the convertible promissory notes (including its accrued interest, totally $520,822) of Centrexion Therapeutics Corporation was converted into preferred stock (Series C) of the same company. On May 25, 2017, the convertible promissory notes (including its accrued interest, totaling $2,558,893) of Alzheon Inc., was converted into preferred stock (Series B) of the same company. The preferred stocks are considered non-marketable investments and were therefore reclassified out of the fair value hierarchy to be reported under cost method. | |
[2] | Upon the effective date of the change in status, March 1, 2017, the subsidiaries were no longer recognized at fair value and were instead consolidated when preparing the financial statements. | |
[3] | The equity investments of common stock and preferred stock were non-marketable investments under cost method upon change in status. Subsequently, Athenex Inc. was listed on the NASDAQ stock exchange on June 14, 2017 and common stock with an amount of $7,920,000 has been transferred to common stock in Level 1 with amount of $7,920,000, which was subsequently sold in December 2017 with a gain from the marketable securities of $3,722,234 recognized. |
Fair Value Measurement (Detai_4
Fair Value Measurement (Details 3) - Warrants [Member] | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Valuation technique | Black-Scholes Model | Black-Scholes Model |
Unobservable input | Estimated time to exit Historical Volatility | Estimated time to exit Historical Volatility |
Range (weighted average) | 12-18 months 73% - 301% | 12-30 months 73% - 188% |
Sensitivity of fair value to input | 10% increase (decrease) in volatility would result in increase (decrease) in fair value by $17,871 | 10% increase (decrease) in volatility would result in increase (decrease) in fair value by $19,691 |
Fair Value Measurement (Detai_5
Fair Value Measurement (Details 4) - Warrants [Member] | Dec. 31, 2019USD ($)Contracts | Dec. 31, 2018USD ($)Contracts |
Equity Price | ||
Notional Amounts | $ | $ 265,576 | $ 218,270 |
Number of Contracts | Contracts | 2,234,373 | 2,257,682 |
Fair Value Measurement (Detai_6
Fair Value Measurement (Details 5) - USD ($) | 10 Months Ended | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | |
Equity Price | |||
Unrealized loss | $ (827,501) | $ 87,599 | $ (974,444) |
Warrants [Member] | |||
Equity Price | |||
Derivative assets | 203,320 | 115,721 | |
Derivative liabilities | |||
Realized loss | (7,094) | (19,225) | |
Unrealized loss | $ (820,407) | $ 87,599 | $ (955,219) |
Fair Value Measurement (Detai_7
Fair Value Measurement (Details 6) | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Fair Value Disclosures [Abstract] | |
Upward adjustments | $ 1,017,468 |
Total unrealized gain for non-marketable investments | $ 1,017,468 |
Fair Value Measurement (Detai_8
Fair Value Measurement (Details 7) | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Fair Value Disclosures [Abstract] | |
Initial cost basis | $ 6,094,712 |
Upward adjustments | 1,017,468 |
Total carrying value at the end of the period | $ 7,112,180 |
Fair Value Measurement (Detai_9
Fair Value Measurement (Details Textual) - USD ($) | 10 Months Ended | 12 Months Ended | ||||
Dec. 31, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | Jun. 14, 2017 | May 25, 2017 | Mar. 09, 2017 | |
Common stock amount | $ 1,266,431 | $ 1,130,059 | $ 7,920,000 | |||
Gain from the marketable securities | $ 3,912,500 | (81,839) | 501,522 | |||
Convertible promissory notes | $ 2,558,893 | $ 520,822 | ||||
Level 1 [Member] | ||||||
Common stock amount | $ 806,778 | $ 813,728 | $ 7,920,000 |
Other Receivables and Prepaym_3
Other Receivables and Prepayments (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Receivables [Abstract] | ||
Prepaid insurance | $ 154,011 | $ 147,864 |
Prepaid service fee | 296,565 | 75,224 |
Rental deposits | 8,584 | 8,576 |
Prepaid rental expenses | 37,169 | 46,948 |
Prepaid research and development expenses | 453,634 | 41,614 |
Other receivables | 109,714 | 109,435 |
Others | 19,366 | 34,495 |
Total | $ 1,079,043 | $ 464,156 |
Other Receivables and Prepaym_4
Other Receivables and Prepayments (Details Textual) | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Aenco Solutions Limited [Member] | |
Other Receivables and Prepayments (Textual) | |
Prepayment for token consultancy services | $ 108,000 |
Digital Currencies (Details)
Digital Currencies (Details) - USD ($) | 10 Months Ended | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | |
Digital Currencies [Abstract] | |||
Beginning balance | |||
Purchase of digital currencies | (200,000) | ||
Utilization of digital currencies to settle service fee | (245,178) | ||
Gain on use of digital currencies | 46,717 | ||
Ending balance | $ 1,539 |
Property, Plant and Equipment_3
Property, Plant and Equipment, Net (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Property, plant and equipment, gross | $ 8,669,218 | $ 4,764,966 |
Less: accumulated depreciation | 1,576,183 | 504,364 |
Property, plant and equipment, net | 7,093,035 | 4,260,602 |
Building [Member] | ||
Property, plant and equipment, gross | 1,488,396 | 1,488,396 |
Computer equipment [Member] | ||
Property, plant and equipment, gross | 76,365 | 64,911 |
Furniture, fixture, and office and medical equipment [Member] | ||
Property, plant and equipment, gross | 271,009 | 262,819 |
Leasehold improvements [Member] | ||
Property, plant and equipment, gross | 665,546 | 664,713 |
Laboratory equipment [Member] | ||
Property, plant and equipment, gross | 4,029,640 | 2,045,034 |
Motor vehicle [Member] | ||
Property, plant and equipment, gross | 239,093 | 239,093 |
Assets in construction [Member] | ||
Property, plant and equipment, gross | $ 1,899,169 |
Property, Plant and Equipment_4
Property, Plant and Equipment, Net (Details Textual) - USD ($) | 10 Months Ended | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | |
Property, Plant and Equipment, Net (Textual) | |||
Depreciation expenses | $ 6,470 | $ 1,071,799 | $ 497,908 |
Intangible Assets, Net (Details
Intangible Assets, Net (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Gross carrying amount | ||
Gross carrying amount | $ 1,620,282 | $ 1,584,204 |
Less: accumulated amortization | ||
Less: accumulated amortization | 308,599 | 174,664 |
Intangible assets, net | ||
Intangible assets, net | 1,311,683 | 1,409,540 |
Prepaid unpatented license [Member] | ||
Gross carrying amount | ||
Gross carrying amount | 200,000 | 200,000 |
Intangible assets, net | ||
Intangible assets, net | 200,000 | 200,000 |
Prepaid Patented licenses [Member] | ||
Gross carrying amount | ||
Gross carrying amount | 1,322,820 | 1,322,820 |
Less: accumulated amortization | ||
Less: accumulated amortization | 257,619 | 155,026 |
Intangible assets, net | ||
Intangible assets, net | 1,065,201 | 1,167,794 |
Computer software [Member] | ||
Gross carrying amount | ||
Gross carrying amount | 97,462 | 61,384 |
Less: accumulated amortization | ||
Less: accumulated amortization | 50,980 | 19,638 |
Intangible assets, net | ||
Intangible assets, net | $ 46,482 | $ 41,746 |
Intangible Assets, Net (Detai_2
Intangible Assets, Net (Details 1) | Dec. 31, 2019USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2020 | $ 146,826 |
2021 | 104,842 |
2022 | 102,593 |
2023 | 102,593 |
2024 | 97,099 |
Thereafter | 557,730 |
Total | $ 1,111,683 |
Intangible Assets, Net (Detai_3
Intangible Assets, Net (Details Textual) - USD ($) | 10 Months Ended | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | |
Intangible Assets, Net (Textual) | |||
Amortization expenses for finite-lived intangible assets | $ 52,433 | $ 167,985 | $ 124,551 |
Wrote off of cost related amortization | $ 34,400 | $ 2,320 |
Long-Term Deposits (Details)
Long-Term Deposits (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Debt Disclosure [Abstract] | ||
Rental deposits | $ 132,043 | $ 132,043 |
Prepayments for equipment | 162,563 | 3,285,135 |
Total | $ 294,606 | $ 3,417,178 |
Accounts Payable and Accrued _3
Accounts Payable and Accrued Expenses (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Accounts Payable and Accrued Liabilities, Current [Abstract] | ||
Research and development expenses payable | $ 554,791 | $ 398,899 |
Cost of healthcare services payable | 45,234 | 40,139 |
Professional fees payable | 171,037 | 178,117 |
Insurance expense payable | 70,811 | |
Interest payable | 8,802 | 223,802 |
Payables for leasehold improvement and equipment | 26,779 | 73,864 |
Deferred bonus and salaries payable | 1,570,324 | 183,065 |
Deferred rent | 55,484 | 58,810 |
Others | 83,265 | 90,451 |
Accounts payable and accrued expenses | $ 2,586,527 | $ 1,247,147 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 10 Months Ended | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |||
Current | |||
Deferred | |||
Total income taxes expense |
Income Taxes (Details 1)
Income Taxes (Details 1) - USD ($) | 10 Months Ended | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |||
Net loss before tax | $ (2,561,507) | $ (20,116,938) | $ (15,134,485) |
Provision for income taxes at Hong Kong statutory income tax rate (16.5%) | (422,649) | (3,319,294) | (2,497,190) |
Impact of different tax rates in other jurisdictions | (91,623) | (3,066) | |
Non-taxable income | (389,714) | (95,018) | |
Non-deductible expenses | 702,433 | 540,893 | |
Prior year tax effect | (576,970) | ||
Change in valuation allowance | 999,619 | 3,098,198 | 2,054,381 |
Effective income tax expense |
Income Taxes (Details 2)
Income Taxes (Details 2) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Deferred tax asset: | ||
Tax loss carry forward | $ 6,699,345 | $ 3,499,428 |
Deferred tax liability: | ||
Depreciation and amortization | (547,147) | (445,428) |
Net deferred tax assets before valuation allowance | 6,152,198 | 3,054,000 |
Valuation allowance | (6,152,198) | (3,054,000) |
Deferred tax asset, net |
Income Taxes (Details Textual)
Income Taxes (Details Textual) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Taxes (Textual) | |||
Net operating loss carry-forwards | $ 40,329,428 | $ 21,191,279 | |
Valuation allowance increased | $ 3,098,198 | $ 2,054,381 | $ 999,619 |
Hong Kong [Member] | |||
Income Taxes (Textual) | |||
Income tax, description | Under the two-tiered profits tax rate regime, the first $2 million of assessable profits of qualifying corporations is taxed at 8.25% and the remaining assessable profits at 16.5%. The Ordinance is effective from the year of assessment 2018-2019. According to the policy, if no election has been made, the whole of the taxpaying entity’s assessable profits will be chargeable to Profits Tax at the rate of 16.5% or 15%, as applicable. Because the preferential tax treatment is not elected by the Group, all the subsidiaries registered in Hong Kong are subject to income tax at a rate of 16.5%. | ||
Net operating loss carry-forwards | $ 439,345 | ||
Statutory income tax rate | (16.50%) | ||
Tax carried forward other losses | 5 years | ||
United Kingdom [Member] | |||
Income Taxes (Textual) | |||
Income tax, description | All the United Kingdom subsidiaries that are not entitled to any tax holiday were subject to income tax at a rate of 19%. The subsidiary in United Kingdom did not have assessable profits that were derived from United Kingdom during the years ended December 31, 2019 and 2018. | ||
Singapore [Member] | |||
Income Taxes (Textual) | |||
Income tax, description | All the Singapore subsidiaries that are not entitled to any tax holiday were subject to income tax at a rate of 17%. The subsidiary in Singapore did not have assessable profits that were derived from Singapore during the years ended December 31, 2019 and 2018. | ||
Seychelles [Member] | |||
Income Taxes (Textual) | |||
Income tax, description | All the Seychelles subsidiaries that are not entitled to any tax holiday were subject to income tax at a rate of 25%. The subsidiary in Seychelles did not have assessable profits that were derived from Seychelles during the years ended December 31, 2019 and 2018. | ||
Samoa [Member] | |||
Income Taxes (Textual) | |||
Income tax, description | All the Samoa subsidiaries that are not entitled to any tax holiday were subject to income tax at a rate of 27%. The subsidiary in Samoa did not have assessable profits that were derived from Samoa during the years ended December 31, 2019 and 2018. | ||
United States (Nevada) [Member] | |||
Income Taxes (Textual) | |||
Income tax, description | All the United States subsidiaries in Nevada that are not entitled to any tax holiday were subject to income tax at a rate of 21%. The subsidiary in the United States did not have assessable profits that were derived from the United States during the years ended December 31, 2019 and 2018. |
Related Party Balances and Tr_3
Related Party Balances and Transactions (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Current | ||
Amounts due from related parties | $ 962 | $ 169,051 |
Non-current | ||
Amounts due from related parties | 50,000 | 50,000 |
AENEAS CAPITAL LIMITED [Member] | ||
Current | ||
Amounts due from related parties | 169,051 | |
Aeneas Management Limited [Member] | ||
Current | ||
Amounts due from related parties | 962 | |
Jurchen Investment Corporation [Member] | ||
Non-current | ||
Amounts due from related parties | $ 50,000 | $ 50,000 |
Related Party Balances and Tr_4
Related Party Balances and Transactions (Details 1) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Current | ||
Amounts due to related parties | $ 41,593 | $ 33,417 |
Non-current | ||
Amounts due to related parties | 6,330,472 | |
Ian Huen [Member] | ||
Current | ||
Amounts due to related parties | 127 | 2,545 |
Clark Cheng [Member] | ||
Current | ||
Amounts due to related parties | 1,114 | 8,893 |
Sabrina Khan [Member] | ||
Current | ||
Amounts due to related parties | 268 | 21,979 |
Aeneas Group Limited [Member] | ||
Current | ||
Amounts due to related parties | 14,247 | |
Non-current | ||
Amounts due to related parties | 3,330,472 | |
Jurchen Investment Corporation [Member] | ||
Current | ||
Amounts due to related parties | 20,055 | |
Non-current | ||
Amounts due to related parties | 3,000,000 | |
Aenco Solutions Limited [Member] | ||
Current | ||
Amounts due to related parties | $ 5,782 |
Related Party Balances and Tr_5
Related Party Balances and Transactions (Details 2) - USD ($) | 10 Months Ended | 12 Months Ended | |||
Dec. 31, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | |||
Aeneas Group Limited [Member] | |||||
Borrowing from related parties | [1] | $ 3,330,472 | |||
Interest expenses | [1] | 14,247 | |||
Payments on behalf of related parties | [2] | 1,853 | |||
Repayments from related parties | [2] | 7,451 | |||
Jurchen Investment Corporation [Member] | |||||
Borrowing from related parties | [1] | 3,000,000 | |||
Interest expenses | [1] | 20,055 | |||
Rental expense | [3] | 227,729 | 207,841 | ||
Payment for rental deposit | [3] | 50,000 | |||
AENEAS CAPITAL LIMITED [Member] | |||||
Payments on behalf of the Group | [4] | 64,038 | 5,057 | ||
Expense reimbursement | [4] | 66,881 | 5,057 | 7,331 | |
Payments on behalf of related parties | [2] | 109,025 | 22,934 | ||
Repayments from related parties | [2] | 169,051 | 132,128 | ||
Consultant, management and administrative fees | 640,932 | 448,718 | |||
Aeneas Management Limited [Member] | |||||
Payments on behalf of the Group | [4] | 5,372 | 156,961 | ||
Expense reimbursement | [4] | 5,372 | 156,961 | ||
Healthcare services income | 1,923 | ||||
Consultant, management and administrative fees | 698,152 | ||||
Aenco Solutions Limited [Member] | |||||
Payments on behalf of the Group | [4] | 186,671 | |||
Prepayments to related parties | [4] | 200,000 | |||
Tokens maintenance fee | [4] | 67,876 | |||
Issuance of tokens for tokens creation, offering and consultancy services | [5] | 300,000 | |||
Tokens creation, offering and consultancy services expense | [5] | 192,000 | |||
Prepayment of tokens consultancy services | [5] | 108,000 | |||
Aeneas Limited [Member] | |||||
Payments on behalf of related parties | [2] | 132,074 | |||
Repayments from related parties | [2] | 190,427 | |||
Aenco Limited [Member] | |||||
Consultant, management and administrative fees | 830,769 | ||||
Ian Huen [Member] | |||||
Borrowing from related parties | [6] | $ 6,410 | |||
[1] | On August 13, 2019, the Group entered into financing arrangements with Aeneas Group Limited, a related party, and Jurchen Investment Corporation, the ultimate parent of the Group, allowing the Group to access up to a total $15.0 million in line of credit debt financing. The line of credit will mature on August 12, 2022 and the interest on the outstanding principal indebtedness will be at the rate of 8% per annum. | ||||
[2] | The Group has paid the expenses on behalf of AENEAS CAPITAL LIMITED, of which the whole amounts were non-interest bearing. There was no further payment on behalf transactions since April 2018. | ||||
[3] | Jurchen Investment Corporation entered into a sub-tenancy agreement with a subsidiary of the Group for the rental arrangement of an office in Hong Kong. For the period February 1, 2018 through January 31, 2021, Jurchen Investment Corporation was entitled to receive a fixed amount of rental fee of HK$130,000 (approximately USD16,667) per calendar month. As of December 31, 2019, the amounts due from Jurchen Investment Corporation represented a $50,000 rental deposit. | ||||
[4] | AENEAS CAPITAL LIMITED and Aeneas Management Limited has paid the operation fee on behalf of the Group and received the expense reimbursement. The balances were non-interest bearing. The Group has prepaid Aenco Solutions Limited, of which the whole amounts were non-interest bearing. The prepayment was used for paying on behalf of the Group of token listing fees, purchasing digital currencies and settlement of maintenance service provided by Aenco Solutions Limited. | ||||
[5] | In July 2019, Smart Pharmaceutical Limited Partnership, a wholly owned subsidiary of the Group, transferred 100,000,000 SMPT token to Aenco Solutions Limited, a related party, in exchange of the services related to token creation and offering and consulting services for five years for an amount of $300,000. | ||||
[6] | The non-interest-bearing loan was borrowed from management for operation purpose and the loan was due on demand. |
Related Party Balances and Tr_6
Related Party Balances and Transactions (Details Textual) - USD ($) | Aug. 13, 2019 | Jan. 29, 2020 | Jul. 31, 2019 | Apr. 30, 2018 | Nov. 11, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | Jan. 02, 2020 | Mar. 29, 2019 | Apr. 03, 2018 |
Related Party Balances and Transactions (Textual) | ||||||||||
Description of rental fee | For the period February 1, 2018 through January 31, 2021, Jurchen Investment Corporation was entitled to receive a fixed amount of rental fee of HK$130,000 (approximately USD16,667) per calendar month. | |||||||||
Ownership of Aeneas Limited and its subsidiary | 100.00% | |||||||||
Cash proceeds | $ 1 | |||||||||
Gain on disposal of entity under common control | 67,874 | |||||||||
Net liabilities of aeneas Limited and subsidiary | $ 67,874 | |||||||||
Shares issued | 112 | |||||||||
Related party transaction, description | Smart Pharmaceutical Limited Partnership, a wholly owned subsidiary of the Group, transferred 100,000,000 SMPT token to Aenco Solutions Limited, a related party, in exchange of the services related to token creation and offering and consulting services for five years for an amount of $300,000. | |||||||||
AENEAS CAPITAL LIMITED [Member] | ||||||||||
Related Party Balances and Transactions (Textual) | ||||||||||
Administrative fees | $ 64,103 | |||||||||
Description of obligation | The Group, AENEAS CAPITAL LIMITED, Aeneas Management Limited and Aeneas Group Limited entered into a net settlement agreement to offset the amounts due from related parties against the amounts due to related parties. Thereby, the Group is released from obligation for a total amount of $164,973, netting off receivables of total amount of $197,878 and collected remaining balance of $32,905. | |||||||||
AENEAS CAPITAL LIMITED [Member] | HKD [Member] | ||||||||||
Related Party Balances and Transactions (Textual) | ||||||||||
Administrative fees | $ 500,000 | |||||||||
Aenco Limited [Member] | ||||||||||
Related Party Balances and Transactions (Textual) | ||||||||||
Services fees | $ 69,231 | |||||||||
Expiry date | Dec. 31, 2020 | |||||||||
Aenco Limited [Member] | Subsequent Event [Member] | ||||||||||
Related Party Balances and Transactions (Textual) | ||||||||||
Services fees | $ 89,744 | |||||||||
Expiry date | Dec. 31, 2020 | |||||||||
Aenco Limited [Member] | HKD [Member] | ||||||||||
Related Party Balances and Transactions (Textual) | ||||||||||
Services fees | $ 540,000 | |||||||||
Aenco Limited [Member] | HKD [Member] | Subsequent Event [Member] | ||||||||||
Related Party Balances and Transactions (Textual) | ||||||||||
Services fees | $ 700,000 | |||||||||
Aeneas Management Limited [Member] | ||||||||||
Related Party Balances and Transactions (Textual) | ||||||||||
Services fees | $ 57,949 | |||||||||
Expiry date | Dec. 31, 2020 | |||||||||
Aeneas Management Limited [Member] | HKD [Member] | ||||||||||
Related Party Balances and Transactions (Textual) | ||||||||||
Services fees | $ 452,000 | |||||||||
Jurchen Investment Corporation [Member] | ||||||||||
Related Party Balances and Transactions (Textual) | ||||||||||
Rental deposit | $ 50,000 | |||||||||
Aptorum Medical Limited [Member] | ||||||||||
Related Party Balances and Transactions (Textual) | ||||||||||
Shares issued | 112 | |||||||||
Aptorum Medical Limited [Member] | Maximum [Member] | ||||||||||
Related Party Balances and Transactions (Textual) | ||||||||||
Ownership of Aeneas Limited and its subsidiary | 95.00% | 100.00% | ||||||||
Aptorum Medical Limited [Member] | Minimum [Member] | ||||||||||
Related Party Balances and Transactions (Textual) | ||||||||||
Ownership of Aeneas Limited and its subsidiary | 94.00% | 95.00% | ||||||||
Aptorum Medical Limited [Member] | Subsequent Event [Member] | ||||||||||
Related Party Balances and Transactions (Textual) | ||||||||||
Shares issued | 115 | |||||||||
Aptorum Medical Limited [Member] | Subsequent Event [Member] | Maximum [Member] | ||||||||||
Related Party Balances and Transactions (Textual) | ||||||||||
Ownership of Aeneas Limited and its subsidiary | 94.00% | |||||||||
Aptorum Medical Limited [Member] | Subsequent Event [Member] | Minimum [Member] | ||||||||||
Related Party Balances and Transactions (Textual) | ||||||||||
Ownership of Aeneas Limited and its subsidiary | 93.00% | |||||||||
Aeneas Group Limited [Member] | ||||||||||
Related Party Balances and Transactions (Textual) | ||||||||||
Line of credit facility, description | The ultimate parent of the Group, allowing the Group to access up to a total $15.0 million in line of credit debt financing. The line of credit will mature on August 12, 2022 and the interest on the outstanding principal indebtedness will be at the rate of 8% per annum. |
Finance Lease (Details)
Finance Lease (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Finance Lease [Abstract] | ||
Gross finance lease obligation | $ 157,047 | $ 210,891 |
Less: Discount on finance lease obligation | 13,173 | 23,141 |
Total capital lease obligation | 143,874 | 187,750 |
Less: Current portion of finance lease obligation | 46,555 | 43,877 |
Net present value of finance lease obligation, net of current portion | $ 97,319 | $ 143,873 |
Finance Lease (Details 1)
Finance Lease (Details 1) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Minimum lease payments | $ 157,047 | |
Less: Amortization of discount | 13,173 | $ 23,141 |
Finance lease obligation | 143,874 | $ 187,750 |
2020 [Member] | ||
Minimum lease payments | 53,845 | |
Less: Amortization of discount | 7,290 | |
Finance lease obligation | 46,555 | |
2021 [Member] | ||
Minimum lease payments | 53,845 | |
Less: Amortization of discount | 4,449 | |
Finance lease obligation | 49,396 | |
2022 [Member] | ||
Minimum lease payments | 49,357 | |
Less: Amortization of discount | 1,434 | |
Finance lease obligation | $ 47,923 |
Convertible Debts (Details)
Convertible Debts (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Debt Disclosure [Abstract] | ||
Gross convertible debts | $ 13,500,000 | |
Less: Discount on issuance cost | 314,744 | |
Discount on BCF | 3,077,950 | |
Convertible debts, net | $ 10,107,306 |
Convertible Debts (Details Text
Convertible Debts (Details Textual) - USD ($) | 1 Months Ended | 10 Months Ended | 12 Months Ended | ||||
Apr. 24, 2019 | Apr. 24, 2019 | Dec. 17, 2018 | Dec. 31, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | Apr. 06, 2018 | |
Convertible Debts (Textual) | |||||||
Convetible debt | $ 10,107,306 | ||||||
Group repurchased its convertible debts | $ 13,600,000 | $ 13,600,000 | |||||
Convertible debts with carrying amount | 13,500,000 | 13,500,000 | |||||
Gain on extinguishment on convertible debts | $ 1,200,000 | $ 1,200,000 | 1,198,490 | ||||
Bond Subscription Agreement [Member] | |||||||
Convertible Debts (Textual) | |||||||
Convetible debt | 3,392,694 | 1,042,870 | |||||
Contractual interest | 342,333 | 815,000 | |||||
Intrinsic value of the BCF | $ 1,300,000 | ||||||
Bond Subscription Agreement, description | The Group repurchased its convertible debts at $13.6 million with carrying amount of $13.5 million and the intrinsic value of BCF is $1.3 million with a gain on extinguishment on convertible debts of $1.2 million. | ||||||
Convertible Bonds [Member] | |||||||
Convertible Debts (Textual) | |||||||
Intrinsic value of the BCF | $ 1,600,400 | ||||||
Interest Expense | $ 1,600,400 | ||||||
Principal amount | $ 15,000,000 | ||||||
Convertible Bonds [Member] | IPO [Member] | |||||||
Convertible Debts (Textual) | |||||||
Interest rate | 10.00% | ||||||
Discount interest rate for actual price | 10.00% | ||||||
Warrants to purchase class A ordinary shares | 230,252 | ||||||
Intrinsic value of the BCF | $ 3,452,657 | ||||||
Interest Expense | $ 383,629 | ||||||
Convertible promissory notes [Member] | |||||||
Convertible Debts (Textual) | |||||||
Convetible debt | 1,600,400 | ||||||
Interest accretion | 26,380 | ||||||
Contractual interest | 8,802 | ||||||
Unamortized debt issuance costs and discounts | $ 22,935 |
Ordinary Shares (Details)
Ordinary Shares (Details) - USD ($) | 1 Months Ended | ||||
Dec. 17, 2018 | Dec. 31, 2019 | Jun. 19, 2019 | Mar. 29, 2019 | Dec. 31, 2018 | |
Ordinary Shares (Textual) | |||||
Shares issued | 112 | ||||
Common Class A [Member] | |||||
Ordinary Shares (Textual) | |||||
Ordinary shares, issued | 6,597,362 | 6,537,269 | |||
Ordinary shares, outstanding | 6,597,362 | 6,537,269 | |||
Common Class A [Member] | Warrant Holders [Member] | |||||
Ordinary Shares (Textual) | |||||
Shares issued | 60,093 | ||||
Ordinary shares, issued | 6,597,362 | ||||
Ordinary shares, outstanding | 6,597,362 | ||||
IPO [Member] | |||||
Ordinary Shares (Textual) | |||||
Shares issued | 761,419 | ||||
Shares issued, par value | $ 15.80 | ||||
Gross proceeds from IPO | $ 12,030,420 | ||||
Offering costs | $ 1,732,370 | $ 1,732,229 | |||
IPO [Member] | Common Class A [Member] | |||||
Ordinary Shares (Textual) | |||||
Ordinary shares, issued | 6,597,362 | ||||
Ordinary shares, outstanding | 6,597,362 |
Share Based Compensation (Detai
Share Based Compensation (Details) - Stock Option [Member] | 12 Months Ended |
Dec. 31, 2019$ / sharesshares | |
Number of share options, Outstanding Beginning | shares | |
Number of share options, Granted | shares | 218,222 |
Number of share options, Outstanding Ending | shares | 218,222 |
Number of share options, Exercisable | shares | |
Weighted average exercise price, Outstanding Beginning | $ / shares | |
Weighted average exercise price, Granted | $ / shares | 12.91 |
Weighted average exercise price, Outstanding Ending | $ / shares | 12.91 |
Weighted average exercise price, Exercisable | $ / shares | |
Remaining contractual term in years, Granted | 12 years 3 months 22 days |
Remaining contractual term in years, outstanding | 11 years 6 months 3 days |
Share Based Compensation (Det_2
Share Based Compensation (Details 1) | 12 Months Ended |
Dec. 31, 2019$ / shares | |
Share-based Payment Arrangement [Abstract] | |
Expected volatility, minimum | 95.02% |
Expected volatality, maximum | 95.15% |
Risk-free interest rate, minimum | 2.82% |
Risk-free interest rate, maximum | 2.822% |
Expected term from grant date (in years), minimum | 6 years 3 months 15 days |
Expected term from grant date (in years), maximum | 7 years 3 months 15 days |
Dividend rate | |
Dilution factor | $ 0.9962 |
Fair value, minimum | |
Fair value, maximum | $ 9.48 |
Share Based Compensation (Det_3
Share Based Compensation (Details Textual) - USD ($) | 1 Months Ended | 12 Months Ended | |
Mar. 15, 2019 | Dec. 31, 2019 | Mar. 29, 2019 | |
Share Based Compensation (Textual) | |||
Total shares issued | 112 | ||
Intrinsic value of options outstanding | $ 642,000 | ||
Employees [Member] | |||
Share Based Compensation (Textual) | |||
Options granted | 1,180,477 | ||
Non-employees [Member] | |||
Share Based Compensation (Textual) | |||
Options granted | 432,355 | ||
2017 Share Option Plan [Member] | Directors, Employees, External Consultants And Advisors [Member] | |||
Share Based Compensation (Textual) | |||
Options granted | 218,222 | ||
Stock option exercise price | $ 12.91 | ||
2017 Share Option Plan [Member] | Class A Ordinary Shares [Member] | |||
Share Based Compensation (Textual) | |||
Total shares issued | 5,500,000 | ||
Stock option related, description | (i) 2% of the outstanding number of Class A Ordinary Shares (on a fully diluted basis) on the immediate preceding December 31, and (ii) such lower number of Class A Ordinary Shares as may be determined by the board of directors, subject in all cases to adjustments as provided in Section 10 of the 2017 Share Option Plan. |
Non-Controlling Interest (Detai
Non-Controlling Interest (Details) - USD ($) | 1 Months Ended | 10 Months Ended | 12 Months Ended | ||
Jul. 31, 2019 | Dec. 31, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | Mar. 29, 2019 | |
Non-Controlling Interest (Textual) | |||||
Non controlling interest | $ (1,509,456) | $ (368,533) | |||
Shares issued | 112 | ||||
Additional paid in capital | $ 10,672 | ||||
Net loss attributable to non-controlling interests | $ (14,045) | $ (1,430,176) | $ (302,762) | ||
Related party description | Total 1 billion SMPT tokens are offered by Smart Pharmaceutical Limited Partnership ("SPLP"), a wholly owned subsidiary of the Group. In July 2019, SPLP transferred 100,000,000 SMPT tokens to Aenco Solutions Limited, a related party of the Group, in exchange for the services related to the tokens creation, offering and 5-year consultancy service. Amount of $300,000 were classified as a component of non-controlling interests within the Group's consolidated financial statements. The remaining 900,000,000 SMPT tokens are remained and kept by SPLP. | ||||
Aptus Biotechnology [Member] | |||||
Non-Controlling Interest (Textual) | |||||
Non-controlling interest rate | 1.00% | ||||
mTOR [Member] | |||||
Non-Controlling Interest (Textual) | |||||
Non-controlling interest rate | 10.00% | 10.00% | |||
Aptorum Medical Limited [Member] | |||||
Non-Controlling Interest (Textual) | |||||
Non-controlling interest rate | 6.00% | 5.00% | |||
Aptorum Medical Limited [Member] | Minimum [Member] | |||||
Non-Controlling Interest (Textual) | |||||
Increase of equity interest percentage | 5.00% | ||||
Aptorum Medical Limited [Member] | Maximum [Member] | |||||
Non-Controlling Interest (Textual) | |||||
Increase of equity interest percentage | 6.00% | ||||
Lanither Life Sciences Limited [Member] | |||||
Non-Controlling Interest (Textual) | |||||
Non-controlling interest rate | 20.00% | 20.00% | |||
Acticule [Member] | |||||
Non-Controlling Interest (Textual) | |||||
Non-controlling interest rate | 20.00% | 20.00% |
Warrants (Details)
Warrants (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Expected volatility | 58.18% | |
Risk-free interest rate | ||
Expected term from grant date (in years) | 0 years | 2 years 5 months 5 days |
Dividend rate | ||
Fair value | ||
Minimum [Member] | ||
Risk-free interest rate | 2.82% | |
Fair value | $ 4.60 | |
Maximum [Member] | ||
Risk-free interest rate | 2.822% | |
Fair value | $ 9.48 |
Warrants (Details 1)
Warrants (Details 1) - Warrants [Member] - $ / shares | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Warrants, Outstanding Beginning | 118,524 | |
Warrants, Exercised | 118,524 | |
Warrants,Granted | 118,524 | |
Warrants, Outstanding Ending | 118,524 | |
Weighted Average Exercise Price Outstanding Beginning | $ 13.79 | |
Weighted Average Exercise Price, Exercised | 13.79 | |
Weighted Average Exercise Price, Granted | 13.79 | |
Weighted Average Exercise Price, Outstanding Ending | $ 13.79 | |
Weighted Average Remaining Contractual Term in Years, Outstanding Beginning | 2 years 5 months 5 days | |
Weighted Average Remaining Contractual Term in Years, Granted | 2 years 6 months | |
Weighted Average Remaining Contractual Term in Years, Execised | 1 year 11 months 15 days | |
Weighted Average Remaining Contractual Term in Years, Outstanding Ending | 2 years 5 months 5 days |
Warrants (Details Textual)
Warrants (Details Textual) - USD ($) | 1 Months Ended | 10 Months Ended | 12 Months Ended | |||
Dec. 17, 2018 | Nov. 30, 2018 | Dec. 31, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | Jun. 19, 2019 | |
Warrants (Textual) | ||||||
Fair value of the warrants | $ 218,147 | $ 659,697 | $ 866,300 | $ (124,726) | ||
Fair value of warrant liabilities | $ 866,300 | |||||
Convertible Debts and IPO [Member] | ||||||
Warrants (Textual) | ||||||
Aggregate of warrants to purchase number of ordinary shares | 38,071 | 80,453 |
Net Loss Per Share (Details)
Net Loss Per Share (Details) - USD ($) | 10 Months Ended | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | |
Numerator: | |||
Net loss attributable to Aptorum Group Limited | $ (2,547,462) | $ (18,686,762) | $ (14,831,723) |
Denominator: | |||
Basic and diluted weighted average common shares outstanding | 26,963,435 | 29,008,445 | 27,909,788 |
Basic and diluted loss per share | $ (0.09) | $ (0.64) | $ (0.53) |
Commitments and Contingencies_2
Commitments and Contingencies (Details) | Dec. 31, 2019USD ($) |
For the years ending December 31, | |
2020 | $ 597,198 |
2021 | 397,842 |
2022 | 75,174 |
2023 | |
2024 and thereafter | |
Total | $ 1,070,214 |
Commitments and Contingencies_3
Commitments and Contingencies (Details 1) | Dec. 31, 2019USD ($) |
Drug molecules: up to the conditions and milestones of | |
Preclinical to IND filing | $ 372,564 |
From entering phase 1 to before first commercial sale | 24,216,410 |
First commercial sale | 15,656,410 |
Net sales amount more than certain threshold in a year | 75,769,231 |
Subtotal | 116,014,615 |
Surgical robotics and medical devices: up to the conditions and milestones of | |
Before FDA approval | 270,000 |
FDA approval obtained | 200,000 |
Subtotal | 470,000 |
Total | $ 116,484,615 |
Commitments and Contingencies_4
Commitments and Contingencies (Details Textual) - USD ($) | 10 Months Ended | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | |
Commitments and Contingencies (Textual) | |||
Rental expenses | $ 49,518 | $ 664,155 | $ 591,546 |
Non-cancellable purchase commitments | 61,859 | ||
Milestone payments | $ 30,000 |
Segment Reporting (Details)
Segment Reporting (Details) | 12 Months Ended |
Dec. 31, 2019Segment | |
Segment Reporting (Textual) | |
Number of reporting segment | 1 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) | 1 Months Ended | |||
Mar. 16, 2020 | Feb. 25, 2020 | Dec. 31, 2019 | Mar. 29, 2019 | |
Subsequent Events (Textual) | ||||
Issued shares | 112 | |||
Common Class A [Member] | 2017 Share Option Plan [Member] | ||||
Subsequent Events (Textual) | ||||
Issued shares | 5,500,000 | |||
Subsequent Event [Member] | ||||
Subsequent Events (Textual) | ||||
Exercise price | $ 7.40 | |||
Gross proceeds | $ 10,000,000 | |||
Subsequent Event [Member] | 2017 Share Option Plan [Member] | ||||
Subsequent Events (Textual) | ||||
Granted share options to employees, external consultants and advisors | 554,882 | |||
Exercise price | $ 2.99 | |||
Subsequent Event [Member] | Warrents Placement Agent [Member] | ||||
Subsequent Events (Textual) | ||||
Exercise price | $ 8.88 | |||
Issued shares | 43,243 | |||
Subsequent Event [Member] | Warrants [Member] | ||||
Subsequent Events (Textual) | ||||
Issued shares | 1,351,350 | |||
Subsequent Event [Member] | Warrants [Member] | SevenYears [Member] | ||||
Subsequent Events (Textual) | ||||
Exercise price | $ 7.40 | |||
Subsequent Event [Member] | Common Class A [Member] | ||||
Subsequent Events (Textual) | ||||
Issued shares | 1,351,350 |