Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2021 | Nov. 14, 2021 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2021 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q3 | |
Entity Registrant Name | Renovacor, Inc. | |
Entity Central Index Key | 0001799850 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity Common Stock, Shares Outstanding | 17,256,042 | |
Entity Shell Company | false | |
Entity File Number | 001-39271 | |
Entity Tax Identification Number | 83-3169838 | |
Entity Address, Address Line One | P.O. Box 8142 | |
Entity Address, City or Town | Greenwich | |
Entity Address, State or Province | CT | |
Entity Incorporation, State or Country Code | DE | |
Entity Address, Postal Zip Code | 06836 | |
City Area Code | 610 | |
Local Phone Number | 424-2650 | |
Common Stock [Member] | ||
Document Information [Line Items] | ||
Trading Symbol | RCOR | |
Security Exchange Name | NYSEAMER | |
Title of 12(b) Security | Common Stock, par value $0.0001 per share | |
Warrants [Member] | ||
Document Information [Line Items] | ||
Trading Symbol | RCOR.WS | |
Security Exchange Name | NYSEAMER | |
Title of 12(b) Security | Warrants to purchase common stock at an exercise price of $11.50 per share |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 | [1] | |
Current assets: | ||||
Cash | $ 85,321 | $ 5,384 | ||
Prepaids and other current assets | 2,635 | 107 | ||
Total current assets | 87,956 | 5,491 | ||
Property and equipment, net | 20 | 1 | ||
Total assets | 87,976 | 5,492 | ||
Current liabilities: | ||||
Accounts payable | 1,502 | 137 | ||
Accrued expenses | 2,184 | 57 | ||
Total current liabilities | 3,686 | 194 | ||
Warrant liability | 14,840 | |||
Share earnout liability (includes 500,000 shares of Common stock, $0.0001 par value per share, subject to forfeiture, issued and outstanding at September 30, 2021 - Note 3) | 16,037 | |||
Total liabilities | 34,563 | 194 | ||
Commitments and contingencies (Note 7) | ||||
Stockholders' equity:** | ||||
Preferred stock, $0.0001 par value per share; 1,000,000 shares authorized; none issued and outstanding at September 30, 2021 and December 31, 2020 | [2] | |||
Common stock, $0.0001 par value per share; 100,000,000 shares authorized; 16,756,042 and 6,274,566 shares issued and outstanding at September 30, 2021 and December 30, 2020, respectively | [2] | 2 | 1 | |
Additional paid-in capital | [2] | 71,877 | 10,194 | |
Accumulated deficit | [2] | (18,466) | (4,897) | |
Total stockholders’ equity | [2] | 53,413 | 5,298 | |
Total liabilities and stockholders’ equity | $ 87,976 | $ 5,492 | ||
[1] | The condensed balance sheet at December 31, 2020 has been derived from the audited financial statements at that date. | |||
[2] | Reflects effect of retroactive application of reverse recapitalization (Note 3). |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2021 | Dec. 31, 2020 |
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 1,000,000 | 1,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 16,756,042 | 6,274,566 |
Common stock, shares outstanding | 16,756,042 | 6,274,566 |
Shares Earnout [Member] | ||
Common stock, earnout shares issuable | 500,000 | |
Common stock, par value | $ 0.0001 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Operating expenses: | ||||
Research and development | $ 2,925 | $ 892 | $ 7,413 | $ 1,868 |
General and administrative | 2,315 | 147 | 3,227 | 547 |
Loss from operations | (5,240) | (1,039) | (10,640) | (2,415) |
Other income (expense): | ||||
Interest expense | (147) | (147) | ||
Change in fair value of derivative liability | 80 | 80 | ||
Change in fair value of warrant liability | (1,435) | (1,435) | ||
Change in fair value of share earnout liability | (1,427) | (1,427) | ||
Net Loss | $ (8,169) | $ (1,039) | $ (13,569) | $ (2,415) |
Net loss per share - basic and diluted | $ (0.83) | $ (0.27) | $ (1.82) | $ (0.69) |
Weighted-average number of common shares used in computing net loss per share applicable to common stockholders - basic and diluted | 9,794,348 | 3,863,631 | 7,460,719 | 3,514,096 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2021 | Sep. 30, 2020 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | |||
Net loss | $ (8,169) | $ (13,569) | $ (2,415) |
Adjustments to reconcile net loss to net cash used in operating activities: | |||
Stock-based compensation | 710 | 2 | |
Gain on change in fair value of derivative liability | (80) | (80) | |
Loss on change in fair value of warrant liability | 1,435 | 1,435 | |
Loss on change in fair value of share earnout liability | 1,427 | 1,427 | |
Amortization of debt discount | 136 | ||
Depreciation expense | 1 | 1 | |
Change in assets and liabilities: | |||
Prepaid expenses and other current assets | (2,528) | (13) | |
Accounts payable | 1,289 | 47 | |
Accrued expenses | 1,879 | 49 | |
Net cash used in operating activities | (9,300) | (2,329) | |
CASH FLOWS FROM FINANCING ACTIVITIES: | |||
Proceeds from issuance of Series A convertible preferred stock, net of issuance costs | 821 | ||
Proceeds from issuance of convertible promissory note, net of issuance costs | 2,445 | ||
Effect of Merger, net of transaction costs (Note 3) | 86,792 | ||
Net cash provided by financing activities | 89,237 | 821 | |
Net increase (decrease) in cash | 79,937 | (1,508) | |
Cash at beginning of period | 5,384 | 2,161 | |
Cash at end of period | $ 85,321 | 85,321 | $ 653 |
SUPPLEMENTAL DISCLOSURES OF NONCASH ACTIVITIES: | |||
Merger costs allocated to equity included in accrued expenses and accounts payable | 304 | ||
Property and equipment in accounts payable | 20 | ||
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFO: | |||
Cash paid during the period for interest | $ 12 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Convertible Preferred Stock and Stockholders' Equity (Deficit) (Unaudited) - USD ($) $ in Thousands | Total | Previously Reported [Member] | Retroactive Application of Reverse Recapitalization [Member] | Convertible Preferred Stock [Member]Previously Reported [Member] | Convertible Preferred Stock [Member]Retroactive Application of Reverse Recapitalization [Member] | Common Stock | Common StockPreviously Reported [Member] | Common StockRetroactive Application of Reverse Recapitalization [Member] | Additional Paid-in Capital | Additional Paid-in CapitalPreviously Reported [Member] | Additional Paid-in CapitalRetroactive Application of Reverse Recapitalization [Member] | Accumulated Equity (Deficit) | Accumulated Equity (Deficit)Previously Reported [Member] | |
Balance at Dec. 31, 2019 | $ 1,867 | $ (1,572) | $ 3,439 | $ 3,534 | $ 95 | $ 3,439 | $ (1,667) | $ (1,667) | ||||||
Balance (in Shares) at Dec. 31, 2019 | 3,318,456 | 1,933,988 | 1,384,468 | |||||||||||
Temporary equity, Balance at Dec. 31, 2019 | $ 3,439 | $ 3,439 | ||||||||||||
Temporary equity, Balance (in Shares) at Dec. 31, 2019 | 934,803 | 934,803 | ||||||||||||
Issuance of restricted common stock, shares | 9,121 | |||||||||||||
Vesting of restricted common stock | 5 | 5 | ||||||||||||
Stock-based compensation | 1 | 1 | ||||||||||||
Net loss | (815) | (815) | ||||||||||||
Balance at Mar. 31, 2020 | 1,058 | 3,540 | (2,482) | |||||||||||
Balance (in Shares) at Mar. 31, 2020 | 3,327,577 | |||||||||||||
Balance at Dec. 31, 2019 | 1,867 | (1,572) | 3,439 | 3,534 | 95 | 3,439 | (1,667) | (1,667) | ||||||
Balance (in Shares) at Dec. 31, 2019 | 3,318,456 | 1,933,988 | 1,384,468 | |||||||||||
Temporary equity, Balance at Dec. 31, 2019 | $ 3,439 | $ 3,439 | ||||||||||||
Temporary equity, Balance (in Shares) at Dec. 31, 2019 | 934,803 | 934,803 | ||||||||||||
Net loss | (2,415) | |||||||||||||
Balance at Sep. 30, 2020 | 289 | 4,371 | (4,082) | |||||||||||
Balance (in Shares) at Sep. 30, 2020 | 3,863,631 | |||||||||||||
Balance at Mar. 31, 2020 | 1,058 | 3,540 | (2,482) | |||||||||||
Balance (in Shares) at Mar. 31, 2020 | 3,327,577 | |||||||||||||
Issuance of Series A Preferred | 821 | 821 | ||||||||||||
Issuance of Series A Preferred, shares | 536,054 | |||||||||||||
Vesting of restricted common stock | 5 | 5 | ||||||||||||
Stock-based compensation | 1 | 1 | ||||||||||||
Net loss | (562) | (562) | ||||||||||||
Balance at Jun. 30, 2020 | 1,323 | 4,367 | (3,044) | |||||||||||
Balance (in Shares) at Jun. 30, 2020 | 3,863,631 | |||||||||||||
Vesting of restricted common stock | 4 | 4 | ||||||||||||
Net loss | (1,038) | (1,038) | ||||||||||||
Balance at Sep. 30, 2020 | 289 | 4,371 | (4,082) | |||||||||||
Balance (in Shares) at Sep. 30, 2020 | 3,863,631 | |||||||||||||
Balance at Dec. 31, 2020 | 5,298 | [1],[2] | (4,776) | 10,074 | $ 1 | $ 1 | 10,194 | 121 | 10,073 | (4,897) | (4,897) | |||
Balance (in Shares) at Dec. 31, 2020 | 6,274,566 | 1,953,368 | 4,321,198 | |||||||||||
Temporary equity, Balance at Dec. 31, 2020 | $ 10,074 | $ 10,074 | ||||||||||||
Temporary equity, Balance (in Shares) at Dec. 31, 2020 | 2,578,518 | 2,578,518 | ||||||||||||
Issuance of restricted common stock, shares | 30,495 | |||||||||||||
Stock-based compensation | 7 | 7 | ||||||||||||
Net loss | (1,681) | (1,681) | ||||||||||||
Balance at Mar. 31, 2021 | 3,624 | $ 1 | 10,201 | (6,578) | ||||||||||
Balance (in Shares) at Mar. 31, 2021 | 6,305,061 | |||||||||||||
Balance at Dec. 31, 2020 | 5,298 | [1],[2] | $ (4,776) | $ 10,074 | $ 1 | $ 1 | 10,194 | $ 121 | $ 10,073 | (4,897) | $ (4,897) | |||
Balance (in Shares) at Dec. 31, 2020 | 6,274,566 | 1,953,368 | 4,321,198 | |||||||||||
Temporary equity, Balance at Dec. 31, 2020 | $ 10,074 | $ 10,074 | ||||||||||||
Temporary equity, Balance (in Shares) at Dec. 31, 2020 | 2,578,518 | 2,578,518 | ||||||||||||
Net loss | (13,569) | |||||||||||||
Balance at Sep. 30, 2021 | 53,413 | [1] | $ 2 | 71,877 | (18,466) | |||||||||
Balance (in Shares) at Sep. 30, 2021 | 16,756,042 | |||||||||||||
Balance at Mar. 31, 2021 | 3,624 | $ 1 | 10,201 | (6,578) | ||||||||||
Balance (in Shares) at Mar. 31, 2021 | 6,305,061 | |||||||||||||
Stock-based compensation | 185 | 185 | ||||||||||||
Net loss | (3,719) | (3,719) | ||||||||||||
Balance at Jun. 30, 2021 | 90 | $ 1 | 10,386 | (10,297) | ||||||||||
Balance (in Shares) at Jun. 30, 2021 | 6,305,061 | |||||||||||||
Effect of Merger and recapitalization | 31,270 | $ 1 | 31,269 | |||||||||||
Effect of Merger and recapitalization, Shares | 8,166,205 | |||||||||||||
Common stock and pre-funded warrants issued pursuant to PIPE financing | 29,704 | 29,704 | ||||||||||||
Common stock and pre-funded warrants issued pursuant to PIPE financing, shares | 2,284,776 | |||||||||||||
Stock-based compensation | 518 | 518 | ||||||||||||
Net loss | (8,169) | (8,169) | ||||||||||||
Balance at Sep. 30, 2021 | $ 53,413 | [1] | $ 2 | $ 71,877 | $ (18,466) | |||||||||
Balance (in Shares) at Sep. 30, 2021 | 16,756,042 | |||||||||||||
[1] | Reflects effect of retroactive application of reverse recapitalization (Note 3). | |||||||||||||
[2] | The condensed balance sheet at December 31, 2020 has been derived from the audited financial statements at that date. |
Business and Organization
Business and Organization | 9 Months Ended |
Sep. 30, 2021 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Business and Organization | Note 1. Business and Organization Renovacor, Inc. (the “Company”, or “Renovacor”) (f/k/a Chardan Healthcare Acquisition 2 Corp. ("Chardan")), a Delaware corporation, is a biotechnology company focused on delivering innovative precision therapies to improve the lives of patients and families battling genetically-driven cardiovascular and related diseases. The Company’s initial focus is on the treatment of BAG3 mutation-associated dilated cardiomyopathy (“BAG3 DCM”), a heritable rare disease that leads to early onset, rapidly progressing heart failure and significant mortality and morbidity. The Company’s lead product candidate, REN-001, is a recombinant AAV9-based gene therapy designed to deliver a fully functional BAG3 gene to augment BAG3 protein levels in cardiomyocytes and slow or halt progression of BAG3 DCM. The Company is subject to risks common to companies in the biopharmaceutical industry, including, but not limited to, risks related to the successful development and commercialization of product candidates, fluctuations in operating results and financial risks, the ability to successfully raise additional funds when needed, protection of proprietary rights and patent risks, patent litigation, compliance with government regulations, dependence on key personnel and prospective collaborative partners, and competition from competing products in the marketplace. Merger Agreement Prior to September 2, 2021, the Company was a special purpose acquisition company formed for the purpose of entering into a merger, share exchange, asset acquisition, stock purchase, recapitalization, reorganization or other similar business transaction with one or more businesses or entities. On September 2, 2021 (the "Closing Date"), the Company consummated the business combination contemplated by that certain Agreement and Plan of Merger, dated March 22, 2021 (the “Merger Agreement”), by and among the Company, CHAQ2 Merger Sub, Inc., a wholly owned subsidiary of the Company (“Merger Sub”), and Renovacor Holdings, Inc. (f/k/a Renovacor, Inc. ("Old Renovacor")). Pursuant to the Merger Agreement, (i) Merger Sub merged with and into Old Renovacor, with Old Renovacor as the surviving company in the merger and, after giving effect to such merger, continuing as a wholly owned subsidiary of the Company (the “Merger”) and (ii) the Company’s name was changed from Chardan Healthcare Acquisition 2 Corp. to Renovacor, Inc. (the “Merger” and, together with the other transactions contemplated by the Merger Agreement, the “Business Combination”). Liquidity Considerations The Company has evaluated whether there are conditions and events, considered in the aggregate, that raise substantial doubt about its ability to continue as a going concern within one year after the date the financial statements are issued. As of September 30, 2021, the Company had an accumulated deficit of $ 18.5 million and a cash balance of $ 85.3 million . The Company has incurred losses and negative cash flows from operations since inception, including net losses of $ 13.6 million for the nine months ended September 30, 2021. The Company expects to continue to incur substantial operating losses and negative cash flows for the foreseeable future and will require additional capital as it continues to advance REN-001 and/or any future product candidates through development. The Company currently expects that it's cash balance as of September 30, 2021 will be sufficient to fund its operations into 2023. However, this estimate is based on assumptions that may prove to be wrong, and the Company's operating plan may change as a result of factors currently unknown. In addition, the Company could utilize it's available capital resources sooner than expected. The Company will need substantial additional funding to support its continuing operations and pursue its growth strategy. Until such time as the Company can generate significant revenue from product sales, if ever, the Company expects to finance its operations through a combination of equity offerings, debt financings, collaborations, strategic alliances and marketing, distribution or licensing arrangements. However, the Company may be unable to raise additional funds or enter into such other agreements or arrangements when needed on favorable terms, or at all. If the Company fails to raise capital or enter into such agreements or arrangements as, and when, needed, it may have to significantly delay, scale back or discontinue the development and commercialization of one or more of its product candidates. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Note 2. Summary of Significant Accounting Policies Basis of Presentation The accompanying unaudited interim condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the United States Securities and Exchange Commission (“SEC”) for interim financial reporting. Accordingly, they do not include all of the information and disclosures required by U.S. GAAP for complete financial statements as certain footnotes or other financial information that are normally required by U.S. GAAP can be condensed or omitted. These condensed consolidated statements are unaudited and, in the opinion of management, include all adjustments (consisting of normal recurring adjustments and accruals) necessary to fairly present the results of the interim periods. The results of operations and cash flows for the three and nine months ended September 30, 2021 are not necessarily indicative of the results that may be expected for the fiscal year ended December 31, 2021 or any other future period. Reverse Recapitalization The Business Combination was accounted for as a reverse recapitalization in accordance with U.S. GAAP (the “Reverse Recapitalization”). Under this method of accounting, the Company is treated as the “acquired” company and Old Renovacor is treated as the acquirer for financial reporting purposes. As a result, the consolidated assets, liabilities and results of operations prior to the Business Combination are those of Old Renovacor. Additionally, the shares and corresponding capital amounts and losses per share, prior to the Business Combination, have been retroactively restated based on shares reflecting the applicable exchange ratio resulting from the Common Per Share Merger Consideration and/or the Preferred Per Share Merger Consideration (each as defined by the Merger Agreement). For additional information on the Business Combination and the resulting exchange ratio, see Note 3, Merger and Recapitalization , to these unaudited condensed consolidated financial statements. Emerging Growth Company Status The Company is an "emerging growth company", as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). Under the JOBS Act, the Company may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the independent registered public accounting firm attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s financial statement with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, expense, and related disclosures. The Company bases estimates and assumptions on historical experience when available and on various factors that it believes to be reasonable under the circumstances. The Company evaluates its estimates and assumptions on an ongoing basis. Estimates relied upon in preparing these financial statements relate to, but are not limited to, the fair value of financial instruments, stock-based compensation assumptions and accrued expenses (including accrued and prepaid clinical costs). Actual results may differ from these estimates under different assumptions or conditions. Concentration of Credit Risk Financial instruments that subject the Company to significant concentrations of credit risk consist primarily of cash accounts in a financial institution, which, at times, may exceed federally insured limits. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant risk on such accounts. Property and Equipment, net Property and equipment is carried at acquisition cost less accumulated depreciation, subject to review for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable in accordance with ASC 360-10-35, Impairment or Disposal of Long-Lived Assets. The cost of normal, recurring, or periodic repairs and maintenance activities related to property and equipment, if any, are expensed as incurred. The cost for planned major maintenance activities, including the related acquisition or construction of assets, is capitalized if the repair will result in future economic benefits. Depreciation and amortization are computed using the straight-line method based on the estimated useful lives of the related assets. Equipment and other long-lived assets are depreciated over three to five years . The Company's property and equipment as of September 30, 2021 is comprised of lab equipment. When an asset is disposed of, the associated cost and accumulated depreciation is removed from the related accounts on the Company's balance sheet with any resulting gain or loss included in the Company's condensed consolidated statement of operations. Financial Instruments The fair value of the Company’s financial instruments is determined and disclosed in accordance with the three-tier fair value hierarchy specified in Note 4, Fair Value Measurements . The Company is required to disclose the estimated fair values of its financial instruments. As of September 30, 2021, the Company’s financial instruments consisted of warrant and share earnout liabilities. No such financial instruments existed as of December 31, 2020. As of September 30, 2021, the Company did not have any other derivatives, hedging instruments or other similar financial instruments. Warrant Liability The Company accounts for stock warrants as either equity instruments, liabilities or derivative liabilities in accordance with ASC Topic 480, Distinguishing Liabilities from Equity ("ASC 480") and/or ASC Topic 815, Derivatives and Hedging ("ASC 815"), depending on the specific terms of the warrant agreement. Liability-classified warrants are recorded at their estimated fair values at each reporting period until they are exercised, terminated, reclassified or otherwise settled. Changes in the estimated fair value of liability-classified warrants are recorded in Change in Fair Value of Warrant Liability in the Company’s condensed consolidated statements of operations. Equity-classified warrants are recorded within additional paid-in capital at the time of issuance and not subject to remeasurement. Share Earnout Liability The Company accounts for share earnout arrangements that represent equity-linked instruments as either liabilities or equity instruments in accordance with ASC 815, unless such arrangements are within the scope of ASC Topic 718, Compensation–Stock Compensation ("ASC 718"), depending on the specific terms of the contract. Contracts classified as liabilities are recorded at their estimated fair values at each reporting period until they are no longer outstanding. Changes in the estimated fair value of liability-classified share earnout arrangements are recorded in Change in Fair Value of Share Earnout Liability in the Company’s condensed consolidated statements of operations. Convertible Note On July 20, 2021, in accordance with the Merger Agreement and pursuant to a note purchase agreement (the “Note Purchase Agreement”), dated July 20, 2021, by and between Old Renovacor and Chardan Healthcare Investments, LLC ("Chardan Healthcare"), an affiliate of the Company's sponsor, Chardan Investments 2, LLC (the "Sponsor"), Old Renovacor issued a $ 2.5 million convertible promissory note to Chardan Healthcare (the “Convertible Promissory Note”) in exchange for $ 2,500,000 in cash to be used to finance Old Renovacor’s operations through the consummation of the Merger. In connection with the closing of the Merger, the total principal of $ 2.5 million converted automatically into shares of the Company’s common stock, at a price per share equal to $ 10.00 . All accrued and unpaid interest was cash settled following the Closing Date. At inception of the Note Purchase Agreement and issuance of the Convertible Promissory Note thereunder, it was determined that certain of the embedded features met the definition of an embedded derivative liability (e.g., contingent redemption features), that was required to be bifurcated from the host instrument (recorded as a debt discount) and measured at fair value. Upon conversion of the Convertible Promissory Note on the Closing Date, the Company reclassified the net carrying value of the Convertible Promissory Note to additional paid-in capital. The Company also derecognized the derivative liability on the Closing Date, resulting in a gain on change in fair value of derivative liability of approximately $ 0.1 million recorded in the condensed consolidated statement of operations for the three and nine months ended September 30, 2021. Research and Development Expense The Company expenses research and development expenses as incurred. The Company’s research and development expenses consist primarily of personnel-related expenses such as salaries, stock-based compensation, and benefits, and external costs of outside vendors engaged to conduct preclinical development activities. The Company accrues for expenses related to development activities performed by third parties based on an evaluation of services received and efforts expended pursuant to the terms of the contractual arrangements. There may be instances in which payments made to the Company’s vendors will exceed the level of services provided and result in a prepayment of expenses. In accruing service fees, the Company estimates the time period over which services will be performed and the level of effort to be expended in each period. If the actual timing of the performance of services or the level of effort varies from the estimate, the Company will adjust the accrual or prepaid expense accordingly. Stock-Based Compensation The Company expenses stock-based compensation to employees and non-employees over the requisite service period, generally the vesting period, based on the estimated grant-date fair value of the awards. The Company accounts for forfeitures as they occur. Stock-based awards with graded-vesting schedules are recognized on a straight-line basis over the requisite service period for each separately vesting portion of the award. The Company estimates the fair value of stock option grants using the Black-Scholes option pricing model, and the assumptions used in calculating the fair value of stock-based awards represent management’s best estimates and involve inherent uncertainties and the application of management’s judgment. All stock-based compensation costs are recorded in general and administrative or research and development costs in the condensed consolidated statements of operations based upon the underlying individual’s role at the Company. Income Taxes In accordance with ASC 270, Interim Reporting , and ASC 740, Income Taxes , the Company is required at the end of each interim period to determine the best estimate of its annual effective tax rate and then apply that rate in providing for income taxes on a current year-to-date (interim period) basis. For the nine months ended September 30, 2021 and 2020, the Company recorded no tax expense or benefit due to the expected current year loss and its historical losses. The Company has no t recorded its net deferred tax asset as of either September 30, 2021 or December 31, 2020 because it maintained a full valuation allowance against all deferred tax assets as of these dates as management has determined that it is not more likely than not that the Company will realize these future tax benefits. As of September 30, 2021 and December 31, 2020, the Company had no uncertain tax positions. Net Loss per Common Share Basic net loss per share of common stock is computed by dividing net loss by the weighted-average number of shares of common stock outstanding during each period, which includes shares of common stock underlying the Pre-funded Warrant (as defined herein), as such warrant is exercisable, in whole or in part, for nominal cash consideration with no expiration date. Shares of common stock outstanding but subject to forfeiture and cancellation by the Company (e.g., Sponsor Earnout Shares – see Note 3) are excluded from the weighted-average shares until the period in which such shares are no longer subject to forfeiture. Diluted net loss per share of common stock includes the effect, if any, from the potential exercise or conversion of securities, such as stock options, Public Warrants and Private Placement Warrants, and Sponsor Earnout Shares and Old Renovacor Earnout Shares (each as defined herein), which would result in the issuance of incremental shares of common stock, unless their effect would be anti-dilutive. See Note 12 for additional details. New Accounting Pronouncements From time to time, new accounting pronouncements are issued by the FASB and rules are issued by the SEC that the Company has or will adopt as of a specified date. Unless otherwise noted, management does not believe that any other recently issued accounting pronouncements issued by the FASB or guidance issued by the SEC had, or is expected to have, a material impact on the Company’s present or future consolidated financial statements. Accounting Pronouncements Recently Adopted In August 2020, the FASB issued ASU 2020-06, Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity . This ASU simplifies the accounting for certain convertible instruments. ASU 2020-06 will be effective for fiscal years beginning after December 15, 2021, with early adoption permitted for interim and annual reporting periods beginning after December 15, 2020. The Company adopted this standard effective January 1, 2021 , and there was no material impact on the Company’s consolidated financial statements. Accounting Pronouncements Not Yet Adopted In February 2016, the FASB issued ASU No. 2016-02, Leases . Subsequently, the FASB issued ASU 2019-10 and then ASU 2020-05, both of which adjusted the effective date of ASU 2016-02 for non-public entities. The accounting standard is effective for non-public entities for fiscal years beginning after December 15, 2021 and interim periods within fiscal years beginning after December 15, 2022. The new standard establishes a right-of-use (ROU) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the statement of operations. A modified retrospective transition approach is required at the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. The Company is currently evaluating the impact of the pending adoption of the new standard on the Company’s consolidated financial statements. |
Merger and Recapitalization
Merger and Recapitalization | 9 Months Ended |
Sep. 30, 2021 | |
Business Combinations [Abstract] | |
Merger and Recapitalization | Note 3. Merger and Recapitalization Merger Agreement As discussed in Note 1, on the Closing Date, the Company closed the Business Combination with Old Renovacor, as a result of which Old Renovacor became a wholly-owned subsidiary of the Company. While the Company was the legal acquirer of Old Renovacor in the business combination, for accounting purposes, the Merger is treated as a reverse recapitalization, whereby Old Renovacor is deemed to be the accounting acquirer, and the historical financial statements of Old Renovacor became the historical consolidated financial statements of the Company upon the closing of the Merger. Under this method of accounting, the Company was treated as the “acquired” company and Old Renovacor is treated as the acquirer for financial reporting purposes. Accordingly, for accounting purposes, the Merger was treated as the equivalent of Old Renovacor issuing stock for the net assets of the Company, accompanied by a recapitalization. The net assets of the Company were stated at historical cost, with no goodwill or other intangible assets recorded. Operations prior to the Merger are presented as those of Old Renovacor. At the consummation of the Merger Agreement upon filing of a certificate of Merger, which occurred on the Closing Date (the "Effective Time"), an aggregate of 6,305,061 shares of the Company’s common stock, par value $ 0.0001 per share, plus 194,926 Exchanged Options (defined below) (the "Aggregate Merger Consideration") was issued to equityholders of Old Renovacor as of immediately prior to the Effective Time. Out of the Aggregate Merger Consideration, each holder of preferred stock of Old Renovacor, par value $ 0.0001 per share (the "Old Renovacor Preferred Stock") was entitled to receive a number of shares of the Company's common stock equal to the Preferred Per Share Merger Consideration (as defined in the Merger Agreement) with respect to such holder’s shares of Old Renovacor Preferred Stock. Each holder of common stock of Old Renovacor, par value $ 0.0001 per share (the "Old Renovacor Common Stock," and together with Old Renovacor’s preferred stock, the "Old Renovacor Capital Stock"), was entitled to receive a number of shares of the Company’s common stock equal to the Common Per Share Merger Consideration (as defined in the Merger Agreement) with respect to such holder’s shares of Old Renovacor Common Stock. In addition, pursuant to the Company's 2021 Investor Incentive Plan, a portion of the Aggregate Merger Consideration was allocated among certain Old Renovacor equityholders or their affiliates who elected to participate in the PIPE Investment on a pro rata basis based on their respective investment amounts. Each option to purchase shares of Old Renovacor Common Stock ("Old Renovacor Option") outstanding as of immediately prior to the Effective Time was converted into an option to purchase a number of shares of the Company’s common stock (rounded down to the nearest whole number) equal to the product of the number of shares of Old Renovacor Common Stock subject to such Old Renovacor option and the Common Per Share Merger Consideration (an "Exchanged Option"), which Exchanged Option is subject to the same vesting terms applicable to the Old Renovacor Option as of immediately prior to the Effective Time. T he shares and corresponding capital amounts and loss per share related to Old Renovacor Common Stock prior to the Business Combination Transaction have been retroactively restated reflect the Common Per Share Merger Consideration and the Preferred Per Share Merger Consideration, as applicable. Holders of Old Renovacor Capital Stock are entitled to receive up to an additional 1,922,816 shares of the Company’s common stock (the “Old Renovacor Earnout Shares”) as follows: 576,845 Old Renovacor Earnout Shares, in the aggregate, if at any time during the period beginning on the date of the Closing (the “Closing Date”) and ending on December 31, 2023 (the “First Earnout Period”), the VWAP (as defined in the Merger Agreement) of the Company’s common stock over any twenty ( 20 ) Trading Days (as defined in the Merger Agreement) (which may or may not be consecutive) within any thirty ( 30 ) consecutive Trading Day period is greater than or equal to $ 17.50 per share of the Company’s common stock (the “First Milestone”). An additional 576,845 Old Renovacor Earnout Shares, in the aggregate, if at any time during the period beginning on the Closing Date and ending on December 31, 2025 (the “Second Earnout Period”), the VWAP of the Company’s common stock over any twenty ( 20 ) Trading Days (which may or may not be consecutive) within any thirty ( 30 ) consecutive Trading Day period is greater than or equal to $ 25.00 per share of the Company’s common stock (the “Second Milestone”). An additional 769,126 Old Renovacor Earnout Shares, in the aggregate, if at any time during the period beginning on the Closing Date and ending on December 31, 2027 (the “Third Earnout Period” and together with the First Earnout Period and the Second Earnout Period, each, an “Earnout Period” and collectively, the “Earnout Periods”), the VWAP of the Company’s common stock over any twenty ( 20 ) Trading Days (which may or may not be consecutive) within any thirty ( 30 ) consecutive Trading Day period is greater than or equal to $ 35.00 per share of the Company’s common stock (the “Third Milestone” and together with the First Milestone and the Second Milestone, the “Earnout Milestones”). Upon the consummation of any Change in Control (as defined in the Merger Agreement) during any Earnout Period, any Earnout Milestone with respect to such Earnout Period that has not yet been achieved shall automatically be deemed to have been achieved regardless of the valuation of the Company’s common stock in such Change in Control transaction and the Company will take all actions necessary to provide for the issuance of the shares of the Company’s common stock comprising the applicable Old Renovacor Earnout Shares issuable in respect of such Earnout Milestone(s) prior to the consummation of such Change in Control. Each holder of Old Renovacor's Capital Stock was entitled to such holder’s aggregate Per Share Earnout Consideration (as defined in the Merger Agreement) in respect of such shares of Old Renovacor's Capital Stock as described above. In addition, at the Effective Time, holders of Old Renovacor Options received the right to be granted an Earnout RSU Award (as defined in the Merger Agreement) in respect of such holder’s Old Renovacor Options, which entitle such holder to an aggregate number of shares of the Company's common stock equal to the aggregate Per Share Earnout Consideration in respect of the shares of Old Renovacor Capital Stock underlying such Old Renovacor Options, if any, subject to the satisfaction of the applicable vesting conditions with respect to the Exchanged Options issued in respect of such Renovacor Options at the Closing. See Note 10 for further details. Further, under the terms of the Business Combination (as provided for in the Sponsor Support Agreement), certain Sponsor Shares totaling 500,000 were placed into escrow and subject to forfeiture (the "Sponsor Earnout Shares"). Such Sponsor Earnout Shares will be released from escrow if the weighted average sale price of the Company's common stock equals or exceeds the applicable Target Price (as set forth in the table below) for any 20 trading days within a 30-day trading period from the Effective Time until the applicable end date. Upon consummation of any Change in Control during any Earnout Period, any Earnout Milestone with respect to such Earnout Period that has not yet been achieved shall automatically be deemed to have been achieved regardless of the valuation of the per share common stock price in such Change in Control transaction. Any Sponsor Earnout Shares that remain unvested as of the expiration of the applicable earnout period shall be forfeited and canceled. The Old Renovacor Earnout Shares and Sponsor Earnout Shares (collectively, the "Earnout Shares") is summarized, as set forth in the table below: Old Renovacor Sponsor Target Price Earnout Shares Earnout Shares Total December 31, 2023 $ 17.50 576,845 150,000 726,845 December 31, 2025 $ 25.00 576,845 150,000 726,845 December 31, 2027 $ 35.00 769,126 200,000 969,126 1,922,816 500,000 2,422,816 PIPE Investment (Private Placement) Concurrently with the execution of the Merger Agreement, the Company entered into subscription agreements (the "Subscription Agreements"), with certain investors ("PIPE Investors"), including Chardan Healthcare, certain stockholders of Old Renovacor and certain other institutional and accredited investors, pursuant to which, on the Closing Date, and concurrently with the closing of the Business Combination, the PIPE Investors purchased an aggregate of 2,284,776 shares the Company's common stock, at a price of $ 10.00 per share, and a pre-funded warrant entitling the holder thereof to purchase 715,224 shares of the Company's common stock (the "Pre-Funded Warrant") at an initial purchase price of $ 9.99 per share underlying the Pre-Funded Warrant, for aggregate gross proceeds of approximately $ 30.0 million (the "PIPE Investment"). The Pre-Funded Warrant is immediately exercisable at an exercise price of $ 0.01 and is exercisable indefinitely, provided that the holder of the Pre-Funded Warrant is prohibited from exercising such Pre-Funded Warrant in an amount that would cause such holder’s beneficial ownership of our Common Stock to exceed 9.99 %, which limitation may be increased up to 19.99 % at the option of the holder from time to time. The following table reconciles the elements of the Merger to the unaudited Condensed Consolidated Statement of Cash Flows for the nine months ended September 30, 2021: Recapitalization Cash – CHAQ trust and cash, net of redemptions 65,127 Cash – PIPE financing 29,993 Less: CHAQ and Old Renovacor transaction costs paid ( 5,828 ) Less: Settlement of convertible note at closing ( 2,500 ) Effect of Merger, net of redemptions and transaction costs 86,792 The following table reconciles the elements of the Merger to the unaudited Condensed Consolidated Statement of Changes in Stockholders' Equity (Deficit) for the nine months September 30, 2021: Recapitalization Cash – CHAQ trust and cash, net of redemptions 65,127 Less: CHAQ and Old Renovacor transaction costs incurred ( 5,842 ) Less: Fair value of assumed Private Placement Warrants from CHAQ ( 13,405 ) Less: Fair value of Earnout Consideration and Sponsor Earnout Consideration (1) ( 14,610 ) Effect of Merger, net of redemptions and transaction costs 31,270 The following table details the number of shares of common stock issued immediately following the consummation of the Merger: Number of Shares Common stock, outstanding prior to Merger 8,622,644 Less: redemption of CHAQ shares ( 2,112,100 ) Common stock of CHAQ 6,510,544 CHAQ Founder shares 2,155,661 Shares issued in PIPE Financing 2,284,776 Merger and PIPE financing shares - common stock 10,950,981 Shares issued to Old Renovacor - common stock (1) 6,305,061 Total shares of common stock immediately after Merger (2) 17,256,042 ——————— (1) The number of shares of common stock issued to Old Renovacor equityholders was determined based on (i) 1,987,636 shares of Old Renovacor Common Stock outstanding immediately prior to the closing of the Merger converted based on the Common Per Share Merger Consideration (as defined in the Merger Agreement) and (ii) 2,578,518 shares of Old Renovacor Preferred Stock outstanding immediately prior to the closing of the Merger converted based on the Preferred Per Share Merger Consideration (as defined in the Merger Agreement). All fractional shares were rounded down. (2) Includes 500,000 shares of common stock being held in escrow and subject to vesting or forfeiture based on satisfaction of the Earnout Milestones set forth in the Sponsor Support Agreement. Such shares are liability classified and included in the Share earnout liability as of September 30, 2021. See Note 9 – Stockholders’ Equity for additional details of the Company’s capital stock. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Note 4. Fair Value Measurements Assets and Liabilities Measured at Fair Value on a Recurring Basis The Company applies the guidance in ASC 820, Fair Value Measurement , to account for financial assets and liabilities measured on a recurring basis. Fair value is measured at the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. As such, fair value is a market-based measurement that is determined based on assumptions that market participants would use in pricing an asset or liability. The Company uses a fair value hierarchy, which distinguishes between assumptions based on market data (observable inputs) and an entity's own assumptions (unobservable inputs). The guidance requires that fair value measurements be classified and disclosed in one of the following three categories: Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities; Level 2: Quoted prices in markets that are not active or inputs which are observable, either directly or indirectly, for substantially the full term of the asset or liability; and Level 3: Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported by little or no market activity). Determining which category an asset or liability falls within the hierarchy requires significant judgment. The Company evaluates its hierarchy disclosures each reporting period. There were no transfers between Level 1, 2 and 3 during the nine months ended September 30, 2021. The table below presents the liabilities measured and recorded in the financial statements at fair value on a recurring basis at September 30, 2021 categorized by the level of inputs used in the valuation of each asset and liability. September 30, 2021 (In thousands) Total Level 1 Level 2 Level 3 Liabilities Warrant liability 14,840 — — 14,840 Share earnout liability 16,037 — — 16,037 Total liabilities 30,877 — — 30,877 As of December 31, 2020, the Company had no assets or liabilities measured and recorded at fair value on a recurring basis. Changes in Level 3 Liabilities Measured at Fair Value on a Recurring Basis Warrant Liability and Earnout Share Liability The reconciliation of the Company's warrant and earnout share liability measured at fair value on a recurring basis using unobservable inputs (Level 3) is as follows: Warrant Earnout Share (In thousands) Liability Liability Balance, December 31, 2020 $ — $ — Assumed warrants due to Merger (1) 13,405 — Issuance of earn-out shares (1) — 14,610 Change in the fair value of liability 1,435 1,427 Balance, September 30, 2021 $ 14,840 $ 16,037 ——————— (1) Represents fair value on the Closing Date. Assumptions Used in Determining Fair Value of Liability-Classified Warrants The Company utilizes a Black-Scholes model to value the Private Placement Warrants at each reporting period, with changes in fair value recognized in the condensed consolidated statements of operations. The estimated fair value of the warrant liability is determined using Level 3 inputs. Inherent in an options pricing model are assumptions related to expected share-price volatility, expected life, risk-free interest rate and dividend yield. The Company estimates the expected volatility of its common stock based on historical volatility of a peer group, considering the expected remaining life of the Private Placement Warrants. The risk-free interest rate is based on the U.S. Treasury zero-coupon yield curve on the valuation date for a maturity similar to the expected remaining life of the Private Placement Warrants. The expected life of the Private Placement Warrants is assumed to be equivalent to their remaining contractual term. The dividend rate is based on the historical rate, which the Company anticipates to remain at zero . The fair value of the Private Placement Warrants has been estimated with the following assumptions: September 30, September 2, 2021 2021 Stock price $ 9.05 $ 8.41 Strike price $ 11.50 $ 11.50 Expected volatility 75.0 % 75.0 % Risk-free interest rate 0.66 % 0.54 % Expected dividend yield — — Expected term (years) 3.56 3.64 Fair value per warrant $ 4.24 $ 3.83 Assumptions Used in Determining Fair Value of Liability-Classified Earnout Shares The Company utilizes a Monte Carlo simulation to value the Earnout Shares. The Company selected this model as it believes it is reflective of all significant assumptions that market participants would likely consider in negotiating the transfer of the Earnout Shares. Such assumptions include, among other inputs, expected stock price volatility, risk-free rates, and change in control assumptions. The Company estimates probability of a change in control based on both market data for the biotechnology industry and managements own assessment. The Company estimates the expected volatility of its common stock based on historical volatility of a peer group, considering the remaining term of the Earnout Shares. The risk-free interest rate is based on the U.S. Treasury zero-coupon yield curve on the valuation date for a maturity similar to the expected remaining life of the Earnout Shares. The expected life of the Earnout Shares is assumed to be equivalent to their remaining contractual term. The dividend rate is based on the historical rate, which the Company anticipates to remain at zero. The fair value of the Earnout Shares has been estimated with the following assumptions: September 30, September 2, 2021 2021 Stock price $ 9.05 $ 8.41 Probability of Change in Control 7.5 % 7.5 % Expected volatility 75.0 % 75.0 % Risk-free interest rate 1.19 % 0.97 % Expected dividend yield — — Remaining term (years) 6.25 6.33 Fair value per share $ 6.62 $ 6.03 |
Prepaid Expenses and Other Curr
Prepaid Expenses and Other Current Assets | 9 Months Ended |
Sep. 30, 2021 | |
Deferred Costs Capitalized Prepaid And Other Assets Disclosure [Abstract] | |
Prepaid Expenses and Other Current Assets | Note 5. Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consisted of the following: September 30, December 31, ($ in thousands) 2021 2020 Research and development costs $ 393 $ 90 Insurance 1,825 15 Other 417 2 Total prepaid expenses and other current assets $ 2,635 $ 107 |
Accrued Expenses
Accrued Expenses | 9 Months Ended |
Sep. 30, 2021 | |
Payables And Accruals [Abstract] | |
Accrued Expenses | Note 6. Accrued Expenses Accrued expenses consisted of the following: September 30, December 31, ($ in thousands) 2021 2020 Employee compensation and benefits $ 400 $ 35 External research and development expenses 965 22 Merger-related costs 261 — Professional fees and other 558 — Total accrued expenses $ 2,184 $ 57 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2021 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 7. Commitments and Contingencies Legal Proceedings The Company is not currently subject to any material legal proceedings. Sponsored Research Agreement The Company is committed to funding the Temple SRA as further described in Note 8. |
License and Sponsored Research
License and Sponsored Research Agreements | 9 Months Ended |
Sep. 30, 2021 | |
Research And Development [Abstract] | |
License and Sponsored Research Agreements | Note 8. License and Sponsored Research Agreements Temple University In August 2019, Old Renovacor entered into an exclusive license agreement effective as of August 12, 2019 (the “Temple License Agreement”) and a sponsored research agreement, which was amended effective as of August 12, 2019, August 27, 2019 and further amended effective as of July 1, 2021 (as amended to date, the “Temple SRA”), each with Temple University (“Temple”). The Temple License Agreement was assigned to the Company in connection with the Merger. Pursuant to the Temple License Agreement, Temple granted the Company an exclusive, royalty-bearing, sublicensable, worldwide license to certain patent rights in certain inventions related to the use of BAG3 technology for the diagnosis, prevention or treatment of diseases in humans, and a non-exclusive license to use specified know-how and materials with a provision that Temple will retain the rights to practice the patent rights for non-commercial educational research purposes only and shall be free to sublicense these rights to other non-profit educational and research institutions solely for noncommercial research and educational purposes. Under the Temple SRA, Temple is primarily responsible for preclinical development activities with respect to licensed technology and know-how through the pursuit of specific investigational questions which, in the aggregate, are intended to provide important supporting data for a future IND-enabling studies and for potential future marketing efforts. The Company is responsible for all subsequent clinical development and commercialization activities with respect to the licensed technology and know-how. Upon execution of the Temple License Agreement in 2019, Old Renovacor issued to Temple 97,879 shares of Old Renovacor Common Stock on the effective date of the transaction and agreed to issue Temple an additional 9,130 shares of Old Renovacor Common Stock upon the closing date of the second tranche of the Series A Convertible Preferred Stock, which occurred in November 2020. The Company also reimbursed Temple for the prosecution and maintenance costs incurred by Temple for the licensed patent rights prior to the Company entering into the License Agreement, and the Company is responsible for all the ongoing costs relating to the prosecution and maintenance of the Temple patent rights licensed to the Company going forward. The Company also agreed to pay Temple a minimum annual administrative fee of $ 20,000 per year beginning with the effective date of the Temple License Agreement and continuing each annual anniversary thereafter. Further, as required by Section 12.2 of the License Agreement, the Company is required to make payment of the assignment fee of $ 100,000 to Temple following closing of the Merger related to the assignment of the License Agreement from Old Renovacor to the Company. The Temple License Agreement requires the Company to pay up to an aggregate of $ 1.25 million to Temple upon the achievement of certain developmental, regulatory and commercial milestones for the first licensed product that achieves said milestones regardless of the number of licensed products that achieve them. In addition, the Company is required to pay Temple a low single-digit royalty on net sales of any product utilizing the patent rights under the License Agreement, up to 50 % of which may be reduced by payments Renovacor makes to third parties for freedom to operate. In addition, the Company must also pay a percentage of all consideration based on a percentage of sublicense consideration received by it, which percentage ranges from the mid-teens to mid-twenties depending on the stage of development at the time of the sublicense agreement. The Temple License Agreement will remain effective until (i) the expiration date of the last-to-expire patents covered under the License Agreement (currently expected to occur in 2041); (ii) the termination by Temple upon (a) an uncured breach by the Company, with a 60-day notification period, (b) the Company’s filing of a voluntary petition in bankruptcy or related proceeding, providing such petition is not dismissed within 90 days after the filing thereof, (c) a failure by the Company to meet certain milestones set forth in the Licensed Agreement, or (d) non-payment of undisputed monies due to Temple, with a 30-day notification period. Additionally, the Company may terminate the entire agreement or with respect to an individual patent or patent application, if desired, subject a 90-day notification period. As it relates to the Temple SRA, prior to the amendment entered into in August 2021 and effective as of July 1, 2021, Temple was to conduct certain preclinical activities for a three-year period, unless terminated sooner or extended by mutual written consent, for which the Company was obligated to fund approximately $ 0.9 million over the three-year initial term of the Temple SRA. The Temple SRA was further amended effective as of July 1, 2021 (the “2021 Amendment”) to, among other things, revise the period of performance, scope of work, and the budget. Following the 2021 Amendment, the Company is obligated to fund a total of approximately $ 5.3 million to Temple through June 30, 2024 pursuant to the Temple SRA, of which approximately $ 1.1 million has been funded and/or incurred since inception of the Temple SRA through September 30, 2021. During the three months ended September 30, 2021 and 2020, the Company recorded research and development expenses of approximately $ 0.5 million and $ 0.1 million, respectively, related to the Temple SRA. During the nine months ended September 30, 2021 and 2020, the Company recorded research and development expenses of approximately $ 0.7 million and $ 0.3 million, respectively, related to the Temple SRA. |
Stockholder's Equity
Stockholder's Equity | 9 Months Ended |
Sep. 30, 2021 | |
Stockholders Equity Note [Abstract] | |
Stockholder's Equity | Note 9. Stockholder’s Equity Common Stock Upon closing of the Merger, pursuant to the terms of the Second Amended and Restated Certificate of Incorporation, the Company was authorized to issue up to 100,000,000 shares of common stock, par value $ 0.0001 per share (the "Common Stock"). As discussed in Note 3, the Company has retroactively adjusted the shares issued and outstanding prior to September 2, 2021 to give effect to the Common Per Share Merger Consideration (as defined in the Merger Agreement) to determine the number of shares of common stock into which they were converted. Prior to the Merger, the Company was authorized to issue up to 6,000,000 shares of common stock, of which 1,987,636 were issued and outstanding immediately prior to the Closing Date. See Note 3. Preferred Stock Upon closing of the Merger, pursuant to the terms of the Second Amended and Restated Certificate of Incorporation, the Company was authorized to issue up to 1,000,000 shares of undesignated preferred stock, par value $ 0.0001 (the "Undesignated Preferred Stock"). The Company's board of directors or any committee thereof is expressly authorized, to the fullest extent permitted by law, to provide by resolution or resolutions for, out of the unissued shares of Undesignated Preferred Stock, the issuance of the shares of Undesignated Preferred Stock in one or more series, and by filing a certificate of designations pursuant to the General Corporate Law of the State of Delaware, to establish or change from time to time the number of shares of each such series, and to fix the designations, powers, including voting powers, full or limited, or no voting powers, preferences and the relative, participating, optional or other special rights of the shares of each series and any qualifications, limitations and restrictions thereof. As discussed in Note 3, the Company has retroactively adjusted the shares issued and outstanding prior to September 2, 2021 to give effect to the Preferred Per Share Merger Consideration (as defined in the Merger Agreement) to determine the number of shares of common stock into which they were converted. Prior to the Merger, the Company was authorized to issue up to 3,333,283 shares of its Series A convertible preferred stock, par value $ 0.0001 ("Series A Preferred Stock"), of which 2,578,518 were issued and outstanding immediately prior to the Closing Date. See Note 3. The Series A Preferred Stock, prior to consummation of the Business Combination, was convertible into common stock at the option of the holder at any time and without payment of any additional consideration. Each share of Series A Preferred Stock was convertible into a number of fully paid shares of common stock as is determined by dividing the Series A Preferred Stock original issuance price ($ 4.065063 ) by the Series A Preferred Stock conversion price (initially equal to $4.065063). Provided, however, shares of Series A Preferred Stock would automatically be converted into shares of common stock upon either (a) the closing of an underwritten public offering at a price of at least $ 12.20 per share resulting in at least $ 60 million of gross proceeds, prior to deductions for underwriting discounts, commission, and expenses, or (b) the date and time, or occurrence of an event, specified by a vote of at least a majority of the holders of the Series A Preferred Stock then outstanding. The Series A Preferred Stock was subject to redemption under certain deemed liquidation events and the holders were entitled to a liquidation preference in the event of a voluntary or involuntary liquidation, dissolution or winding-up of the Company, or deemed liquidation event of the Company (which includes certain mergers and asset transfers). The liquidation preference was an amount equal $ 4.065063 , plus cumulative accrued dividends to date on such shares. Assumed Public Warrants Prior to the Merger, the Company had outstanding 8,622,644 warrants (the "Public Warrants") which were issued in connection with the Company's initial public offering in April 2020 (the "Chardan IPO"). Each Public Warrant entitles the holder to purchase one-half of one share of the Company's common stock at an exercise price of $ 11.50 per whole share, subject to adjustment. No fractional shares will be issued upon exercise of the Public Warrants. Therefore, the Public Warrants must be exercised in multiples of two Public Warrants for one share of the Company's common stock. The Public Warrants became exercisable upon the closing of the Business Combination; provided the Company has an effective and current registration statement covering the shares of Company common stock issuable upon the exercise of the Public Warrants and a current prospectus relating to such shares of common stock. The Public Warrants will expire five years following the Closing Date or earlier upon redemption or liquidation. The Company may redeem the Public Warrants: in whole and not in part; at a price of $0.01 per Public Warrant; at any time during the exercise period; upon a minimum of 30 days ’ prior written notice of redemption; if, and only if, the last sale price of the Company’s common stock equals or exceeds $ 16.00 per share for any 10 trading days within a 30-trading day period ending on the third business day prior to the date on which the Company sends the notice of redemption to the warrant holders; and if, and only if, there is a current registration statement in effect with respect to the shares of common stock underlying such Public Warrants at the time of redemption and for the entire 30-day trading period referred to above and continuing each day thereafter until the date of redemption. To date, certain of the above conditions have not been met to redeem the Public Warrants. If the Company calls the Public Warrants for redemption, management will have the option to require all holders that wish to exercise the Public Warrants to do so on a “cashless basis,” as described in the warrant agreement. The exercise price and number of shares of Common Stock issuable upon exercise of the Public Warrants may be adjusted in certain circumstances including in the event of a stock dividend, or recapitalization, reorganization, merger or consolidation. Additionally, in no event will the Company be required to net cash settle the Public Warrants. The Company determined that the Public Warrants met all of the criteria for equity classification. Accordingly, upon closing of the Merger, the Public Warrants were recorded as a component of additional paid-in capital. Assumed Private Placement Warrants Prior to the Merger, the Company had outstanding 3,500,000 warrants (the "Private Placement Warrants") which were issued simultaneously with the closing of the Chardan IPO, pursuant to a private placement transaction. Each Private Placement Warrant is exercisable to purchase one share of common stock at an exercise price of $ 11.50 . The Private Placement Warrants are identical to the Public Warrants except that the Private Placement Warrants (i) will be exercisable for cash (even if a registration statement covering the shares of common stock issuable upon exercise of such warrants is not effective) or on a cashless basis, at the holder’s option, and (ii) will not be non-redeemable by the Company, in each case, so long as they are held by the initial purchasers or their permitted transferees. If the Private Placement Warrants are held by someone other than the initial purchasers or their permitted transferees, the Private Placement Warrants will be redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants. The Private Placement Warrants purchased by Chardan will not be exercisable more than five years from the effective date of the Chardan IPO, in accordance with FINRA Rule 5110(f)(2)(G)(i), as long as Chardan Capital Markets or any of its related persons beneficially own these Private Placement Warrants. The Private Placement Warrants are not indexed to the Company’s common stock in the manner contemplated by ASC 815-40-15 because the holder of the instrument is not an input into the pricing of a fixed-for-fixed option on equity shares. The Company classifies the Private Placement Warrants as derivative liabilities in its condensed consolidated balance sheet as of September 30, 2021. The Company measures the fair value of the warrants at the end of each reporting period and recognizes changes in the fair value from the prior period in the Company’s operating results for the current period. Refer to Note 4 for discussion of fair value measurement of the warrant liabilities. The following table summarizes outstanding warrants to purchase shares of the Company’s common stock as of September 30, 2021 and December 31, 2020: Number of Shares September 30, December 31, Weighted-Average 2021 2020 Exercise Price Expiration Date Liability-classified Warrants April 2020 Private Placement Warrants (1) 3,500,000 — $ 11.50 4/23/2025 (4) 3,500,000 — Equity-classified Warrants April 2020 Public Warrants (2) 8,622,644 — $ 11.50 9/2/2026 September 2021 Pre-Funded Warrants (3) 715,224 — $ 0.01 — 9,337,868 — Total outstanding 12,837,868 — ——————— (1) Private Placement Warrants assumed in the Merger. Each warrant share is exercisable for one share of common stock. (2) Public Warrants assumed in the Merger. Each warrant share is exercisable for one-half share of common stock, provided, however, each warrant must be exercised in multiples of two. (3) Pre-Funded Warrant issued in connection with PIPE Investment (Note 3). Each warrant share is exercisable indefinitely for one share of common stock. (4) The Private Placement Warrants purchased by Chardan will not be exercisable more than five years from the effective date of the Chardan IPO, in accordance with FINRA Rule 5110(f)(2)(G)(i), as long as Chardan Capital Markets or any of its related persons beneficially own these Private Placement Warrants. Otherwise, such Private Placement Warrants shall expire on September 2, 2026 . Capital Stock Reserves As of September 30, 2021, the Company reserved the following shares of common stock for future issuance: Shares issuable upon exercise of pre-funded warrants outstanding 715,224 Shares issuable upon exercise of warrants outstanding 7,811,322 Shares issuable upon issuance of contingent consideration (earnout shares) 1,995,362 Shares issuable upon exercise of outstanding stock options 1,114,131 Shares reserved for future issuance under 2021 Incentive Plan 1,240,537 Total 12,876,576 |
Stock-based Compensation
Stock-based Compensation | 9 Months Ended |
Sep. 30, 2021 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Stock-based Compensation | Note 10. Stock-based Compensation Equity Incentive Plans As of September 30, 2020, the only equity compensation plan from which the Company may currently issue new awards is the Company’s 2021 Omnibus Incentive Plan (the “2021 Plan”), as more fully described below. 2018 Stock Option and Grant Plan Prior to the Merger, Old Renovacor maintained its 2018 Stock Option and Grant Plan (the "2018 Plan"), under which Old Renovacor granted incentive stock options, non-qualified stock options and restricted stock awards to its employees and certain non-employees, including consultants, advisors and directors. The maximum aggregate shares of common stock that was subject to awards and issuable under the 2018 Plan was 1,118,869 prior to the Merger. As more fully described in Note 3, in connection with the Merger, each Old Renovacor Option that was outstanding and unexercised immediately prior to the Effective Time (whether vested or unvested) was assumed by the Company and converted into an option to purchase an adjusted number of shares of the Company's common stock at an adjusted exercise price per share, based on the Per Common Share Merger Consideration, and will continue to be governed by substantially the same terms and conditions, including vesting, as were applicable to the former option. Each Exchanged Option is exercisable for a number of whole shares of common stock equal to the product of the number of shares of Old Renovacor Common Stock underlying such Old Renovacor Options multiplied by the Per Common Share Merger Consideration, and the per share exercise price of such Exchanged Option is equal to the quotient determined by dividing the exercise price per share of the Old Renovacor Option by the Per Common Share Merger Consideration. Following the closing of the Merger, no new awards may be made under the 2018 Plan. Upon the closing of the Merger, the outstanding and unexercised Old Renovacor Options became options to purchase an aggregate 194,926 shares of the Company’s common stock at an average exercise price of $ 5.66 per share. The Company accounted for the Exchanged Options as a modification of the existing options. Incremental compensation costs, measured as the excess, if any, of the fair value of the modified options over the fair value of the original options immediately before its terms are modified, is measured based on the fair value of the underlying shares and other pertinent factors at the modification date. The impact of the option modifications were de minimis. 2021 Omnibus Incentive Plan At the Effective Time, the Company adopted the 2021 Plan which permits the granting of incentive stock options, non-qualified options, stock appreciation rights, restricted stock, restricted stock units and other stock-based award, and performance awards to employees, directors, and non-employee consultants and/or advisors. As of September 30, 2021, 2,229,407 shares of Common Stock are authorized for issuance pursuant to awards under the 2021 Plan. The pool of available shares will be automatically increased on the first day of each calendar year, beginning January 1, 2022 and ending January 1, 2031, by an amount equal to the lesser of (i) 4 % of the outstanding shares of our Common Stock determined on a fully-diluted basis as of the immediately preceding December 31 and (ii) such smaller number of shares as determined by the Company's board of directors. In addition, any awards outstanding under the 2018 Plan upon the closing of the Business Combination, after adjustment for the Business Combination, remain outstanding. If any of those awards subsequently expire, terminate, or are surrendered or forfeited for any reason without issuance of shares after the closing of the Business Combination, the shares of the Company's common stock underlying those awards will automatically become available for issuance under the 2021 Plan. No new awards may be made under the 2018 Plan. The exercise prices, vesting and other restrictions of the awards to be granted under the 2021 Plan are determined by the board of directors, except that no stock option may be issued with an exercise price less than the fair market value of the common stock at the date of the grant or have a term in excess of ten years. Options granted under the 2021 Plan are exercisable in whole or in part at any time subsequent to vesting. As of September 30, 2021, options exercisable for 919,205 shares of commons stock have been granted and (i) 1,237,656 shares of common stock remain available for future issuance under the 2021 Plan and (ii) an additional 72,546 shares of common stock are reserved for future issuance under the 2021 Plan to be used solely and exclusively for the grant of restricted stock units pursuant to the earnout provisions of the Merger Agreement (defined as “Earnout RSUs” under the 2021 Plan). Accounting for Stock-based Compensation The Company recognizes non-cash compensation expense for stock-based awards under the Company’s equity incentive plans over an award’s requisite service period, or vesting period, using the straight-line attribution method, based on their grant date fair value, determined using the Black-Scholes option-pricing model. Generally, the Company issues awards with only service-based vesting conditions and records the expense for these awards using the straight-line method. The Company recognizes forfeitures related to stock-based compensation awards as they occur and reverses any previously recognized compensation cost associated with forfeited awards in the period the forfeiture occurs. The Company classifies stock-based compensation expense in the statement of operations in the same manner in which the award recipients’ payroll costs are classified or in which the award recipients’ service payments are classified. Total stock-based compensation expense attributable to stock-based payments made to employees, consultants and directors included in operating expenses in the Company's condensed consolidated statements of operations for the three and nine months ended September 30, 2021 and 2020 was as follows: Three Months Ended Nine Months Ended September 30, September 30, ($ in thousands) 2021 2020 2021 2020 Research and development $ 364 $ 1 $ 543 $ 1 General and administrative 154 — 167 1 Total stock-based compensation expense $ 518 $ 1 $ 710 $ 2 Stock Option Awards Assumptions Used in Determining Fair Value of Stock Options Inherent in the Black-Scholes option-pricing model are the following assumptions: Volatility . The Company lacks company-specific historical and implied volatility information. Therefore, the Company estimates the expected stock volatility based on the historical volatility of a publicly traded set of peer companies over a period of time commensurate with the expected term of the stock options. The Company expects to continue to do so until it has adequate historical data regarding the volatility of the Company's traded stock price. Expected term . The Company uses the simplified method described in the SEC’s Staff Accounting Bulletin No. 107, Share-Based Payment (“ SAB 107 ”), to determine the expected life of the option grants. Risk-free interest rate . The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant commensurate with the expected term assumption. Expected term . The expected term of stock options granted is based on an estimate of when options will be exercised or cancelled in the future. Dividend rate . The dividend rate is based on the historical rate, which the Company anticipates will remain at zero. Forfeitures . The Company accounts for forfeitures when they occur. Ultimately, the actual expense recognized over the vesting period will be for only those shares that vest. Prior to the Business Combination, the grant date fair value of the shares of Old Renovacor common stock was determined by the Old Renovacor's board of directors with the assistance of management using valuation methodologies which utilize certain assumptions including probability weighting of events, volatility, time to liquidation, a risk-free interest rate, and an assumption for a discount for lack of marketability. In determining the fair value of the shares of Old Renovacor's common stock, the methodologies used to estimate the enterprise value were performed using methodologies, approaches, and assumptions consistent with the American Institute of Certified Public Accountants Accounting and Valuation Guide, Valuation of Privately-Held-Company Equity Securities Issued as Compensation . Subsequent to the Business Combination, the Company utilizes the price of its publicly-traded common stock to determine the grant date fair value of awards. The fair value of each option award at the date of grant was estimated using the Black-Scholes option pricing model. All options granted during the nine months ended September 30, 2021 and 2020 were granted at exercise prices equal to the fair market value of the common stock on the dates of grant. The following table provides the weighted-average assumptions used in determining the fair value of option awards to purchase 1,041,004 and 37,531 shares of common stock issued during the nine months ended September 30, 2021 and 2020, respectively: Nine Months Ended September 30, 2021 2020 Expected volatility 77.7 % 69.4 % Risk-free Interest Rate 0.92 % 1.46 % Expected dividend yield — — Expected term (years) 5.95 5.94 The weighted average fair value of the options granted was $ 5.22 and $ 0.28 per share for the nine months ended September 30, 2021 and 2020, respectively. Stock Option Activity The following table summarizes stock option activity for the nine months ended September 30, 2021: ($ in thousands, except share and per share data) Stock Weighted-Average Weighted-Average Aggregate Outstanding at December 31, 2020 (as previously reported) 82,179 $ 0.25 8.4 $ 12 Retroactive application of reverse recapitalization (Note 3) ( 9,052 ) 0.04 Outstanding at December 31, 2020, effect of Merger 73,127 $ 0.29 Granted 1,041,004 7.87 Exercised — — Forfeited — — Expired — — Outstanding at September 30, 2021 (1) 1,114,131 $ 7.37 9.7 $ 2,032 Exercisable at September 30, 2021 55,060 $ 0.25 5.8 $ 484 During the nine months ended September 30, 2021, the Company issued 88,991 options in connection with the employment of one of its officers, which shares are expected to vest in December 2021 upon the attainment of certain performance conditions. The fair value of options that vested during the nine months ended September 30, 2021 was less than $ 0.1 million. As of September 30, 2021, there was approximately $ 4.9 million of unrecognized stock-based compensation expense related to unvested stock options, which the Company expects to recognize over a weighted average period of 3.5 years. Restricted Stock Awards In connection with the closing of the Merger, all unvested restricted stock awards outstanding immediately prior to the Effective Time became fully vested, resulting in the recognition of less than $ 0.1 million in stock-based compensation expense. Additionally, as of September 30, 2021 the Company is committed to issuing 72,546 Earnout RSUs pursuant to the provisions of the Merger Agreement, representing holders of Old Renovacor Options aggregate Per Share Earnout Consideration (as defined in the Merger Agreement) in respect of such shares of Old Renovacor Options, which are expected to be issued in the fourth quarter of 2021. See Note 3 for details. |
Related Parties
Related Parties | 9 Months Ended |
Sep. 30, 2021 | |
Related Party Transactions [Abstract] | |
Related Parties | Note 11. Related Parties Sponsor Ownership Jonas Grossman, a member of the Company's board of directors since 2018, is a managing member of Chardan Capital Markets, LLC ("Chardan CM"), an affiliate of the Sponsor. Additionally, Gbola Amusa, a member of the Company's board of directors since June 2018, is a partner of Chardan CM. As of September 30, 2021, the Sponsor beneficially owns 1,605,661 shares of the Company’s common stock, excluding the Sponsor Earnout Shares being held in escrow and subject to vesting or forfeiture based on satisfaction of the Earnout Milestones set forth in that certain Sponsor Support Agreement, representing approximately 9.6 % of the Company's outstanding common stock. An affiliate of the Sponsor, Chardan Healthcare Investments LLC, also owns 250,000 shares of the Company’s common stock. Prior to the Merger, in December 2018, the Sponsor and certain of its employees purchased 5,000,000 shares of the Company's Common Stock for an aggregate purchase price of $ 25,000 and, in April 2020, canceled 2,556,250 of their shares, resulting in 2,443,750 remaining shares owned by the Sponsor and certain of its employees ("Sponsor Shares"). In June 2020, an additional 288,089 Sponsor Shares were canceled, and 500,000 shares became Sponsor Earnout Shares pursuant to the Sponsor Support Agreement upon the closing of the Business Combination. Further, in April 2020, the Sponsor purchased 3,500,000 Private Placement Warrants at $ 0.40 per warrant (for a total purchase price of $ 1.4 million), as more fully described in Note 9. On July 20, 2021, in accordance with the Merger Agreement and the Note Purchase Agreement, Old Renovacor issued a $ 2.5 million Convertible Promissory Note in exchange for $ 2.5 million in cash to be used to finance Old Renovacor’s operations through the consummation of the Merger. In connection with the consummation of the Merger, the total principal of $ 2.5 million converted automatically into shares of the Company’s common stock, at a price per share equal to $ 10.00 . All accrued and unpaid interest was cash settled following the Closing Date. PIPE Investment (Private Placement) Concurrently with the execution of the Merger Agreement, the Company entered into Subscription Agreements with the PIPE Investors, including Chardan Healthcare Investments, LLC, an affiliate of the Sponsor, certain stockholders of Old Renovacor and certain other institutional and accredited investors, pursuant to which, on September 2, 2021, in connection with the consummation of the Business Combination, the PIPE Investors purchased an aggregate of 2,284,776 shares of the Company's common stock and the Pre-Funded Warrant to purchase 715,224 shares of the Company's Common Stock, as more fully described in Note 3. Agreements with Dr. Arthur Feldman In August 2019, Old Renovacor entered into a consulting agreement (the "Feldman Consulting Agreement") with its founder and 5 % or greater stockholder, Dr. Arthur Feldman, pursuant to which Dr. Feldman agreed to perform certain consulting services for Old Renovacor in exchange for a consulting fee of $ 8,333.33 per calendar month. The Feldman Consulting Agreement has a term of three years , subject to automatic renewal for successive one-year terms unless earlier terminated. The Company amended the Feldman Consulting Agreement on September 2, 2021, to appoint Dr. Feldman as the Company's Chief Scientific Advisor. The Company incurred consulting fees with Dr. Arthur Feldman, the founder and prior director Old Renovacor, of approximately $ 25,000 and $ 75,000 for each of the three and nine months ended September 30, 2021 and 2020, respectively. As of September 30, 2021, amounts due to Dr. Feldman totaled $ 8,333 . Agreements with Temple Dr. Arthur Feldman, the Company's founder, 5 % or greater stockholder and current Chief Scientific Advisor, is an employee of Temple. During the three months ended September 30, 2021 and 2020, the Company recorded research and development expenses of approximately $ 0.5 million and $ 0.1 million, respectively, related to the Temple SRA. During the nine months ended September 30, 2021 and 2020, the Company recorded research and development expenses of approximately $ 0.7 million and $ 0.3 million, respectively, related to the Temple SRA. See Note 8 for further information on the Temple SRA. |
Net Loss Per Share
Net Loss Per Share | 9 Months Ended |
Sep. 30, 2021 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share | Note 12. Net Loss Per Share Basic net loss per share of common stock is computed by dividing net loss by the weighted-average number of shares of common stock , which includes the shares underlying the outstanding Pre-Funded Warrant, as such warrant is exercisable, in whole or in part, for nominal cash consideration with no expiration date . Shares of common stock outstanding but subject to forfeiture and cancellation by the Company (e.g., Sponsor Earnout Shares – see Note 3) are excluded from the weighted-average number of shares until the period in which such shares are no longer subject to forfeiture. Diluted net loss per share of common stock includes the effect, if any, from the potential exercise or conversion of securities, such as stock options, Public Warrants and Private Placement Warrants , and Sponsor Earnout Shares and Old Renovacor Earnout Shares, which would result in the issuance of incremental shares of common stock, unless their effect would be anti-dilutive. The following outstanding potentially dilutive securities have been excluded from the calculation of diluted net loss per share for the three and nine months ended September 30, 2021 and 2020, as their effect is anti-dilutive: Three Months Ended Nine Months Ended September 30, September 30, 2021 2020 2021 2020 Stock options 1,114,131 73,127 1,114,131 73,127 Common stock warrants 12,122,644 — 12,122,644 — Earnout shares 2,495,362 — 2,495,362 — Total 15,732,137 73,127 15,732,137 73,127 |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 13. Subsequent Events The Company considers events or transactions that occur after the balance sheet date but prior to the issuance of the financial statements to provide additional evidence relative to certain estimates or to identify matters that require additional disclosure. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited interim condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the United States Securities and Exchange Commission (“SEC”) for interim financial reporting. Accordingly, they do not include all of the information and disclosures required by U.S. GAAP for complete financial statements as certain footnotes or other financial information that are normally required by U.S. GAAP can be condensed or omitted. These condensed consolidated statements are unaudited and, in the opinion of management, include all adjustments (consisting of normal recurring adjustments and accruals) necessary to fairly present the results of the interim periods. The results of operations and cash flows for the three and nine months ended September 30, 2021 are not necessarily indicative of the results that may be expected for the fiscal year ended December 31, 2021 or any other future period. |
Reverse Recapitalization | Reverse Recapitalization The Business Combination was accounted for as a reverse recapitalization in accordance with U.S. GAAP (the “Reverse Recapitalization”). Under this method of accounting, the Company is treated as the “acquired” company and Old Renovacor is treated as the acquirer for financial reporting purposes. As a result, the consolidated assets, liabilities and results of operations prior to the Business Combination are those of Old Renovacor. Additionally, the shares and corresponding capital amounts and losses per share, prior to the Business Combination, have been retroactively restated based on shares reflecting the applicable exchange ratio resulting from the Common Per Share Merger Consideration and/or the Preferred Per Share Merger Consideration (each as defined by the Merger Agreement). For additional information on the Business Combination and the resulting exchange ratio, see Note 3, Merger and Recapitalization , to these unaudited condensed consolidated financial statements. |
Emerging Growth Company Status | Emerging Growth Company Status The Company is an "emerging growth company", as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). Under the JOBS Act, the Company may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the independent registered public accounting firm attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s financial statement with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, expense, and related disclosures. The Company bases estimates and assumptions on historical experience when available and on various factors that it believes to be reasonable under the circumstances. The Company evaluates its estimates and assumptions on an ongoing basis. Estimates relied upon in preparing these financial statements relate to, but are not limited to, the fair value of financial instruments, stock-based compensation assumptions and accrued expenses (including accrued and prepaid clinical costs). Actual results may differ from these estimates under different assumptions or conditions. |
Concentration of Credit Risk | Concentration of Credit Risk Financial instruments that subject the Company to significant concentrations of credit risk consist primarily of cash accounts in a financial institution, which, at times, may exceed federally insured limits. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant risk on such accounts. |
Property and Equipment, net | Property and Equipment, net Property and equipment is carried at acquisition cost less accumulated depreciation, subject to review for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable in accordance with ASC 360-10-35, Impairment or Disposal of Long-Lived Assets. The cost of normal, recurring, or periodic repairs and maintenance activities related to property and equipment, if any, are expensed as incurred. The cost for planned major maintenance activities, including the related acquisition or construction of assets, is capitalized if the repair will result in future economic benefits. Depreciation and amortization are computed using the straight-line method based on the estimated useful lives of the related assets. Equipment and other long-lived assets are depreciated over three to five years . The Company's property and equipment as of September 30, 2021 is comprised of lab equipment. When an asset is disposed of, the associated cost and accumulated depreciation is removed from the related accounts on the Company's balance sheet with any resulting gain or loss included in the Company's condensed consolidated statement of operations. |
Financial Instruments | Financial Instruments The fair value of the Company’s financial instruments is determined and disclosed in accordance with the three-tier fair value hierarchy specified in Note 4, Fair Value Measurements . The Company is required to disclose the estimated fair values of its financial instruments. As of September 30, 2021, the Company’s financial instruments consisted of warrant and share earnout liabilities. No such financial instruments existed as of December 31, 2020. As of September 30, 2021, the Company did not have any other derivatives, hedging instruments or other similar financial instruments. |
Warrant Liability | Warrant Liability The Company accounts for stock warrants as either equity instruments, liabilities or derivative liabilities in accordance with ASC Topic 480, Distinguishing Liabilities from Equity ("ASC 480") and/or ASC Topic 815, Derivatives and Hedging ("ASC 815"), depending on the specific terms of the warrant agreement. Liability-classified warrants are recorded at their estimated fair values at each reporting period until they are exercised, terminated, reclassified or otherwise settled. Changes in the estimated fair value of liability-classified warrants are recorded in Change in Fair Value of Warrant Liability in the Company’s condensed consolidated statements of operations. Equity-classified warrants are recorded within additional paid-in capital at the time of issuance and not subject to remeasurement. |
Share Earnout Liability | Share Earnout Liability The Company accounts for share earnout arrangements that represent equity-linked instruments as either liabilities or equity instruments in accordance with ASC 815, unless such arrangements are within the scope of ASC Topic 718, Compensation–Stock Compensation ("ASC 718"), depending on the specific terms of the contract. Contracts classified as liabilities are recorded at their estimated fair values at each reporting period until they are no longer outstanding. Changes in the estimated fair value of liability-classified share earnout arrangements are recorded in Change in Fair Value of Share Earnout Liability in the Company’s condensed consolidated statements of operations. |
Convertible Note | Convertible Note On July 20, 2021, in accordance with the Merger Agreement and pursuant to a note purchase agreement (the “Note Purchase Agreement”), dated July 20, 2021, by and between Old Renovacor and Chardan Healthcare Investments, LLC ("Chardan Healthcare"), an affiliate of the Company's sponsor, Chardan Investments 2, LLC (the "Sponsor"), Old Renovacor issued a $ 2.5 million convertible promissory note to Chardan Healthcare (the “Convertible Promissory Note”) in exchange for $ 2,500,000 in cash to be used to finance Old Renovacor’s operations through the consummation of the Merger. In connection with the closing of the Merger, the total principal of $ 2.5 million converted automatically into shares of the Company’s common stock, at a price per share equal to $ 10.00 . All accrued and unpaid interest was cash settled following the Closing Date. At inception of the Note Purchase Agreement and issuance of the Convertible Promissory Note thereunder, it was determined that certain of the embedded features met the definition of an embedded derivative liability (e.g., contingent redemption features), that was required to be bifurcated from the host instrument (recorded as a debt discount) and measured at fair value. Upon conversion of the Convertible Promissory Note on the Closing Date, the Company reclassified the net carrying value of the Convertible Promissory Note to additional paid-in capital. The Company also derecognized the derivative liability on the Closing Date, resulting in a gain on change in fair value of derivative liability of approximately $ 0.1 million recorded in the condensed consolidated statement of operations for the three and nine months ended September 30, 2021. |
Research and Development Expense | Research and Development Expense The Company expenses research and development expenses as incurred. The Company’s research and development expenses consist primarily of personnel-related expenses such as salaries, stock-based compensation, and benefits, and external costs of outside vendors engaged to conduct preclinical development activities. The Company accrues for expenses related to development activities performed by third parties based on an evaluation of services received and efforts expended pursuant to the terms of the contractual arrangements. There may be instances in which payments made to the Company’s vendors will exceed the level of services provided and result in a prepayment of expenses. In accruing service fees, the Company estimates the time period over which services will be performed and the level of effort to be expended in each period. If the actual timing of the performance of services or the level of effort varies from the estimate, the Company will adjust the accrual or prepaid expense accordingly. |
Stock-Based Compensation | Stock-Based Compensation The Company expenses stock-based compensation to employees and non-employees over the requisite service period, generally the vesting period, based on the estimated grant-date fair value of the awards. The Company accounts for forfeitures as they occur. Stock-based awards with graded-vesting schedules are recognized on a straight-line basis over the requisite service period for each separately vesting portion of the award. The Company estimates the fair value of stock option grants using the Black-Scholes option pricing model, and the assumptions used in calculating the fair value of stock-based awards represent management’s best estimates and involve inherent uncertainties and the application of management’s judgment. All stock-based compensation costs are recorded in general and administrative or research and development costs in the condensed consolidated statements of operations based upon the underlying individual’s role at the Company. |
Income Taxes | Income Taxes In accordance with ASC 270, Interim Reporting , and ASC 740, Income Taxes , the Company is required at the end of each interim period to determine the best estimate of its annual effective tax rate and then apply that rate in providing for income taxes on a current year-to-date (interim period) basis. For the nine months ended September 30, 2021 and 2020, the Company recorded no tax expense or benefit due to the expected current year loss and its historical losses. The Company has no t recorded its net deferred tax asset as of either September 30, 2021 or December 31, 2020 because it maintained a full valuation allowance against all deferred tax assets as of these dates as management has determined that it is not more likely than not that the Company will realize these future tax benefits. As of September 30, 2021 and December 31, 2020, the Company had no uncertain tax positions. |
Net Loss per Common Share | Net Loss per Common Share Basic net loss per share of common stock is computed by dividing net loss by the weighted-average number of shares of common stock outstanding during each period, which includes shares of common stock underlying the Pre-funded Warrant (as defined herein), as such warrant is exercisable, in whole or in part, for nominal cash consideration with no expiration date. Shares of common stock outstanding but subject to forfeiture and cancellation by the Company (e.g., Sponsor Earnout Shares – see Note 3) are excluded from the weighted-average shares until the period in which such shares are no longer subject to forfeiture. Diluted net loss per share of common stock includes the effect, if any, from the potential exercise or conversion of securities, such as stock options, Public Warrants and Private Placement Warrants, and Sponsor Earnout Shares and Old Renovacor Earnout Shares (each as defined herein), which would result in the issuance of incremental shares of common stock, unless their effect would be anti-dilutive. See Note 12 for additional details. |
New Accounting Pronouncements | New Accounting Pronouncements From time to time, new accounting pronouncements are issued by the FASB and rules are issued by the SEC that the Company has or will adopt as of a specified date. Unless otherwise noted, management does not believe that any other recently issued accounting pronouncements issued by the FASB or guidance issued by the SEC had, or is expected to have, a material impact on the Company’s present or future consolidated financial statements. Accounting Pronouncements Recently Adopted In August 2020, the FASB issued ASU 2020-06, Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity . This ASU simplifies the accounting for certain convertible instruments. ASU 2020-06 will be effective for fiscal years beginning after December 15, 2021, with early adoption permitted for interim and annual reporting periods beginning after December 15, 2020. The Company adopted this standard effective January 1, 2021 , and there was no material impact on the Company’s consolidated financial statements. Accounting Pronouncements Not Yet Adopted In February 2016, the FASB issued ASU No. 2016-02, Leases . Subsequently, the FASB issued ASU 2019-10 and then ASU 2020-05, both of which adjusted the effective date of ASU 2016-02 for non-public entities. The accounting standard is effective for non-public entities for fiscal years beginning after December 15, 2021 and interim periods within fiscal years beginning after December 15, 2022. The new standard establishes a right-of-use (ROU) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the statement of operations. A modified retrospective transition approach is required at the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. The Company is currently evaluating the impact of the pending adoption of the new standard on the Company’s consolidated financial statements. |
Merger and Recapitalization (Ta
Merger and Recapitalization (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Business Combinations [Abstract] | |
Summary of Earnout Shares | The Old Renovacor Earnout Shares and Sponsor Earnout Shares (collectively, the "Earnout Shares") is summarized, as set forth in the table below: Old Renovacor Sponsor Target Price Earnout Shares Earnout Shares Total December 31, 2023 $ 17.50 576,845 150,000 726,845 December 31, 2025 $ 25.00 576,845 150,000 726,845 December 31, 2027 $ 35.00 769,126 200,000 969,126 1,922,816 500,000 2,422,816 |
Schedule of Merger to Unaudited Condensed Consolidated Statement of Cash Flows | The following table reconciles the elements of the Merger to the unaudited Condensed Consolidated Statement of Cash Flows for the nine months ended September 30, 2021: Recapitalization Cash – CHAQ trust and cash, net of redemptions 65,127 Cash – PIPE financing 29,993 Less: CHAQ and Old Renovacor transaction costs paid ( 5,828 ) Less: Settlement of convertible note at closing ( 2,500 ) Effect of Merger, net of redemptions and transaction costs 86,792 |
Schedule of Merger to Unaudited Condensed Consolidated Statement of Changes in Stockholders' Equity (Deficit) | The following table reconciles the elements of the Merger to the unaudited Condensed Consolidated Statement of Changes in Stockholders' Equity (Deficit) for the nine months September 30, 2021: Recapitalization Cash – CHAQ trust and cash, net of redemptions 65,127 Less: CHAQ and Old Renovacor transaction costs incurred ( 5,842 ) Less: Fair value of assumed Private Placement Warrants from CHAQ ( 13,405 ) Less: Fair value of Earnout Consideration and Sponsor Earnout Consideration (1) ( 14,610 ) Effect of Merger, net of redemptions and transaction costs 31,270 |
Summary of Number of Shares Common Stock Issued Immediately Following Consummation of Merger | The following table details the number of shares of common stock issued immediately following the consummation of the Merger: Number of Shares Common stock, outstanding prior to Merger 8,622,644 Less: redemption of CHAQ shares ( 2,112,100 ) Common stock of CHAQ 6,510,544 CHAQ Founder shares 2,155,661 Shares issued in PIPE Financing 2,284,776 Merger and PIPE financing shares - common stock 10,950,981 Shares issued to Old Renovacor - common stock (1) 6,305,061 Total shares of common stock immediately after Merger (2) 17,256,042 ——————— (1) The number of shares of common stock issued to Old Renovacor equityholders was determined based on (i) 1,987,636 shares of Old Renovacor Common Stock outstanding immediately prior to the closing of the Merger converted based on the Common Per Share Merger Consideration (as defined in the Merger Agreement) and (ii) 2,578,518 shares of Old Renovacor Preferred Stock outstanding immediately prior to the closing of the Merger converted based on the Preferred Per Share Merger Consideration (as defined in the Merger Agreement). All fractional shares were rounded down. (2) Includes 500,000 shares of common stock being held in escrow and subject to vesting or forfeiture based on satisfaction of the Earnout Milestones set forth in the Sponsor Support Agreement. Such shares are liability classified and included in the Share earnout liability as of September 30, 2021. |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Schedule of Liabilities Measured at Fair Value on Recurring Basis | The table below presents the liabilities measured and recorded in the financial statements at fair value on a recurring basis at September 30, 2021 categorized by the level of inputs used in the valuation of each asset and liability. September 30, 2021 (In thousands) Total Level 1 Level 2 Level 3 Liabilities Warrant liability 14,840 — — 14,840 Share earnout liability 16,037 — — 16,037 Total liabilities 30,877 — — 30,877 |
Schedule of Warrant and Earnout Share Liability Measured on Recurring Basis Using Unobservable Inputs | The reconciliation of the Company's warrant and earnout share liability measured at fair value on a recurring basis using unobservable inputs (Level 3) is as follows: Warrant Earnout Share (In thousands) Liability Liability Balance, December 31, 2020 $ — $ — Assumed warrants due to Merger (1) 13,405 — Issuance of earn-out shares (1) — 14,610 Change in the fair value of liability 1,435 1,427 Balance, September 30, 2021 $ 14,840 $ 16,037 ——————— (1) Represents fair value on the Closing Date. |
Private Placement Warrants [Member] | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Schedule of Assumptions Used in Determining Fair Value of Private Placement Warrants and Earnout Shares | The fair value of the Private Placement Warrants has been estimated with the following assumptions: September 30, September 2, 2021 2021 Stock price $ 9.05 $ 8.41 Strike price $ 11.50 $ 11.50 Expected volatility 75.0 % 75.0 % Risk-free interest rate 0.66 % 0.54 % Expected dividend yield — — Expected term (years) 3.56 3.64 Fair value per warrant $ 4.24 $ 3.83 |
Earnout Shares [Member] | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Schedule of Assumptions Used in Determining Fair Value of Private Placement Warrants and Earnout Shares | The fair value of the Earnout Shares has been estimated with the following assumptions: September 30, September 2, 2021 2021 Stock price $ 9.05 $ 8.41 Probability of Change in Control 7.5 % 7.5 % Expected volatility 75.0 % 75.0 % Risk-free interest rate 1.19 % 0.97 % Expected dividend yield — — Remaining term (years) 6.25 6.33 Fair value per share $ 6.62 $ 6.03 |
Prepaid Expenses and Other Cu_2
Prepaid Expenses and Other Current Assets (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Deferred Costs Capitalized Prepaid And Other Assets Disclosure [Abstract] | |
Summary of Prepaid Expenses and Other Current Assets | Prepaid expenses and other current assets consisted of the following: September 30, December 31, ($ in thousands) 2021 2020 Research and development costs $ 393 $ 90 Insurance 1,825 15 Other 417 2 Total prepaid expenses and other current assets $ 2,635 $ 107 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Payables And Accruals [Abstract] | |
Schedule of Accrued Expenses | Accrued expenses consisted of the following: September 30, December 31, ($ in thousands) 2021 2020 Employee compensation and benefits $ 400 $ 35 External research and development expenses 965 22 Merger-related costs 261 — Professional fees and other 558 — Total accrued expenses $ 2,184 $ 57 |
Stockholder's Equity (Tables)
Stockholder's Equity (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Stockholders Equity Note [Abstract] | |
Summary of Outstanding Warrants to Purchase Shares of Common Stock | The following table summarizes outstanding warrants to purchase shares of the Company’s common stock as of September 30, 2021 and December 31, 2020: Number of Shares September 30, December 31, Weighted-Average 2021 2020 Exercise Price Expiration Date Liability-classified Warrants April 2020 Private Placement Warrants (1) 3,500,000 — $ 11.50 4/23/2025 (4) 3,500,000 — Equity-classified Warrants April 2020 Public Warrants (2) 8,622,644 — $ 11.50 9/2/2026 September 2021 Pre-Funded Warrants (3) 715,224 — $ 0.01 — 9,337,868 — Total outstanding 12,837,868 — ——————— (1) Private Placement Warrants assumed in the Merger. Each warrant share is exercisable for one share of common stock. (2) Public Warrants assumed in the Merger. Each warrant share is exercisable for one-half share of common stock, provided, however, each warrant must be exercised in multiples of two. (3) Pre-Funded Warrant issued in connection with PIPE Investment (Note 3). Each warrant share is exercisable indefinitely for one share of common stock. (4) The Private Placement Warrants purchased by Chardan will not be exercisable more than five years from the effective date of the Chardan IPO, in accordance with FINRA Rule 5110(f)(2)(G)(i), as long as Chardan Capital Markets or any of its related persons beneficially own these Private Placement Warrants. Otherwise, such Private Placement Warrants shall expire on September 2, 2026 . |
Schedule of Common Stock Shares Reserved for Future Issuance | As of September 30, 2021, the Company reserved the following shares of common stock for future issuance: Shares issuable upon exercise of pre-funded warrants outstanding 715,224 Shares issuable upon exercise of warrants outstanding 7,811,322 Shares issuable upon issuance of contingent consideration (earnout shares) 1,995,362 Shares issuable upon exercise of outstanding stock options 1,114,131 Shares reserved for future issuance under 2021 Incentive Plan 1,240,537 Total 12,876,576 |
Stock-based Compensation (Table
Stock-based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Schedule of Stock-based Compensation Expense | Total stock-based compensation expense attributable to stock-based payments made to employees, consultants and directors included in operating expenses in the Company's condensed consolidated statements of operations for the three and nine months ended September 30, 2021 and 2020 was as follows: Three Months Ended Nine Months Ended September 30, September 30, ($ in thousands) 2021 2020 2021 2020 Research and development $ 364 $ 1 $ 543 $ 1 General and administrative 154 — 167 1 Total stock-based compensation expense $ 518 $ 1 $ 710 $ 2 |
Schedule of Assumptions Used in Determining the Fair Value of Option Awards | The following table provides the weighted-average assumptions used in determining the fair value of option awards to purchase 1,041,004 and 37,531 shares of common stock issued during the nine months ended September 30, 2021 and 2020, respectively: Nine Months Ended September 30, 2021 2020 Expected volatility 77.7 % 69.4 % Risk-free Interest Rate 0.92 % 1.46 % Expected dividend yield — — Expected term (years) 5.95 5.94 |
Summary of Stock Option Activity | The following table summarizes stock option activity for the nine months ended September 30, 2021: ($ in thousands, except share and per share data) Stock Weighted-Average Weighted-Average Aggregate Outstanding at December 31, 2020 (as previously reported) 82,179 $ 0.25 8.4 $ 12 Retroactive application of reverse recapitalization (Note 3) ( 9,052 ) 0.04 Outstanding at December 31, 2020, effect of Merger 73,127 $ 0.29 Granted 1,041,004 7.87 Exercised — — Forfeited — — Expired — — Outstanding at September 30, 2021 (1) 1,114,131 $ 7.37 9.7 $ 2,032 Exercisable at September 30, 2021 55,060 $ 0.25 5.8 $ 484 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of Potentially Antidilutive Securities Excluded from Computation of Diluted Net Loss Per Share | The following outstanding potentially dilutive securities have been excluded from the calculation of diluted net loss per share for the three and nine months ended September 30, 2021 and 2020, as their effect is anti-dilutive: Three Months Ended Nine Months Ended September 30, September 30, 2021 2020 2021 2020 Stock options 1,114,131 73,127 1,114,131 73,127 Common stock warrants 12,122,644 — 12,122,644 — Earnout shares 2,495,362 — 2,495,362 — Total 15,732,137 73,127 15,732,137 73,127 |
Business and Organization - Add
Business and Organization - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | [2] | ||
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |||||||
Accumulated deficit | [1] | $ 18,466 | $ 18,466 | $ 4,897 | |||
Cash | 85,300 | 85,300 | |||||
Net losses | $ 8,169 | $ 1,039 | $ 13,569 | $ 2,415 | |||
[1] | Reflects effect of retroactive application of reverse recapitalization (Note 3). | ||||||
[2] | The condensed balance sheet at December 31, 2020 has been derived from the audited financial statements at that date. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies - Additional Information (Details) - USD ($) | Jul. 20, 2021 | Sep. 30, 2021 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 |
Significant Accounting Policies Table [Line Items] | |||||
Uncertain tax positions | $ 0 | $ 0 | $ 0 | ||
Tax expense or benefit due to expected current year loss and its historical losses | 0 | $ 0 | |||
Proceeds from convertible debt | 2,445,000 | ||||
Change in fair value of derivative liability | 80,000 | 80,000 | |||
Net deferred tax asset | $ 0 | $ 0 | $ 0 | ||
ASU 2020-06 | |||||
Significant Accounting Policies Table [Line Items] | |||||
Accounting standards update, adopted [true false] | true | true | |||
Accounting standards update, adoption date | Jan. 1, 2021 | Jan. 1, 2021 | |||
Accounting standards update, immaterial effect | true | true | |||
Convertible Promissory Note [Member] | |||||
Significant Accounting Policies Table [Line Items] | |||||
Debt Conversion, Converted Instrument, Amount | $ 2,500,000 | ||||
Proceeds from convertible debt | $ 2,500,000 | ||||
Share price | $ 10 | ||||
Convertible Promissory Note [Member] | Common Stock | |||||
Significant Accounting Policies Table [Line Items] | |||||
Debt Instrument, Convertible, Carrying Amount of Equity Component | $ 2,500,000 | ||||
Equipment and Other Long-lived Assets | Minimum | |||||
Significant Accounting Policies Table [Line Items] | |||||
Useful life | 3 years | ||||
Equipment and Other Long-lived Assets | Maximum [Member] | |||||
Significant Accounting Policies Table [Line Items] | |||||
Useful life | 5 years |
Merger and Recapitalization - A
Merger and Recapitalization - Additional Information (Details) | 9 Months Ended | |
Sep. 30, 2021USD ($)TradingDay$ / sharesshares | Dec. 31, 2020$ / shares | |
Business Acquisition [Line Items] | ||
Common stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Sponsor Support Agreement [Member] | ||
Business Acquisition [Line Items] | ||
Sponsor shares placed into escrow subject to forfeiture | shares | 500,000 | |
PIPE Investors [Member] | ||
Business Acquisition [Line Items] | ||
Number of shares issue and sell to investors (in Shares) | shares | 2,284,776 | |
Share price (in Dollars per share) | $ 10 | |
Gross proceeds from issuance of shares to investors | $ | $ 30,000,000 | |
Initial purchase price per share (in Dollars per share) | $ 9.99 | |
Pre-Funded Warrants [Member] | ||
Business Acquisition [Line Items] | ||
Number of shares issue and sell to investors (in Shares) | shares | 715,224 | |
Warrants exercise price (in Dollars per share) | $ 0.01 | |
Percentage of beneficial ownership limitation | 9.99% | |
Pre-Funded Warrants [Member] | Maximum [Member] | ||
Business Acquisition [Line Items] | ||
Percentage of beneficial ownership limitation | 19.99% | |
First Earnout Period [Member] | ||
Business Acquisition [Line Items] | ||
Earn out period end date | Dec. 31, 2023 | |
Second Earnout Period [Member] | ||
Business Acquisition [Line Items] | ||
Earn out period end date | Dec. 31, 2025 | |
Third Earnout Period [Member] | ||
Business Acquisition [Line Items] | ||
Earn out period end date | Dec. 31, 2027 | |
Old Renovacor [Member] | ||
Business Acquisition [Line Items] | ||
Other intangible assets | $ | $ 0 | |
Goodwill | $ | $ 0 | |
Common stock, par value | $ 0.0001 | |
Preferred stock, par value | $ 0.0001 | |
Old Renovacor [Member] | Earnout Shares [Member] | ||
Business Acquisition [Line Items] | ||
Maximum number of additional shares entitled to receive | shares | 1,922,816 | |
Old Renovacor [Member] | First Earnout Period [Member] | ||
Business Acquisition [Line Items] | ||
Maximum number of additional shares entitled to receive | shares | 576,845 | |
Earn out period end date | Dec. 31, 2023 | |
Price per share | $ 17.50 | |
Number of trading days | TradingDay | 20 | |
Number of consecutive trading days | TradingDay | 30 | |
Old Renovacor [Member] | Second Earnout Period [Member] | ||
Business Acquisition [Line Items] | ||
Maximum number of additional shares entitled to receive | shares | 576,845 | |
Earn out period end date | Dec. 31, 2025 | |
Price per share | $ 25 | |
Number of trading days | TradingDay | 20 | |
Number of consecutive trading days | TradingDay | 30 | |
Old Renovacor [Member] | Third Earnout Period [Member] | ||
Business Acquisition [Line Items] | ||
Maximum number of additional shares entitled to receive | shares | 769,126 | |
Earn out period end date | Dec. 31, 2027 | |
Price per share | $ 35 | |
Number of trading days | TradingDay | 20 | |
Number of consecutive trading days | TradingDay | 30 | |
Old Renovacor [Member] | Common Stock [Member] | ||
Business Acquisition [Line Items] | ||
Shares issued | shares | 6,305,061 | |
Common stock, par value | $ 0.0001 | |
Exchanged options issued | shares | 194,926 |
Merger and Recapitalization - S
Merger and Recapitalization - Summary of Earnout Shares (Details) | 9 Months Ended |
Sep. 30, 2021$ / sharesshares | |
Targeted Or Tracking Stock Stock [Line Items] | |
Earnout shares | 2,422,816 |
Sponsor [Member] | |
Targeted Or Tracking Stock Stock [Line Items] | |
Earnout shares | 500,000 |
Old Renovacor [Member] | |
Targeted Or Tracking Stock Stock [Line Items] | |
Earnout shares | 1,922,816 |
First Earnout Period [Member] | |
Targeted Or Tracking Stock Stock [Line Items] | |
Earn out period end date | Dec. 31, 2023 |
Target price | $ / shares | $ 17.50 |
Earnout shares | 726,845 |
First Earnout Period [Member] | Sponsor [Member] | |
Targeted Or Tracking Stock Stock [Line Items] | |
Earnout shares | 150,000 |
First Earnout Period [Member] | Old Renovacor [Member] | |
Targeted Or Tracking Stock Stock [Line Items] | |
Earn out period end date | Dec. 31, 2023 |
Earnout shares | 576,845 |
Second Earnout Period [Member] | |
Targeted Or Tracking Stock Stock [Line Items] | |
Earn out period end date | Dec. 31, 2025 |
Target price | $ / shares | $ 25 |
Earnout shares | 726,845 |
Second Earnout Period [Member] | Sponsor [Member] | |
Targeted Or Tracking Stock Stock [Line Items] | |
Earnout shares | 150,000 |
Second Earnout Period [Member] | Old Renovacor [Member] | |
Targeted Or Tracking Stock Stock [Line Items] | |
Earn out period end date | Dec. 31, 2025 |
Earnout shares | 576,845 |
Third Earnout Period [Member] | |
Targeted Or Tracking Stock Stock [Line Items] | |
Earn out period end date | Dec. 31, 2027 |
Target price | $ / shares | $ 35 |
Earnout shares | 969,126 |
Third Earnout Period [Member] | Sponsor [Member] | |
Targeted Or Tracking Stock Stock [Line Items] | |
Earnout shares | 200,000 |
Third Earnout Period [Member] | Old Renovacor [Member] | |
Targeted Or Tracking Stock Stock [Line Items] | |
Earn out period end date | Dec. 31, 2027 |
Earnout shares | 769,126 |
Merger and Recapitalization -_2
Merger and Recapitalization - Schedule of Merger to Unaudited Condensed Consolidated Statement of Cash Flows (Details) | 9 Months Ended |
Sep. 30, 2021USD ($) | |
Business Acquisition [Line Items] | |
Less: Settlement of convertible note at closing | $ (2,500) |
Effect of Merger, net of redemptions and transaction costs | 86,792 |
CHAQ [Member] | |
Business Acquisition [Line Items] | |
Cash – net of redemptions | 65,127 |
PIPE Investment [Member] | |
Business Acquisition [Line Items] | |
Cash – net of redemptions | 29,993 |
CHAQ and Old Renovacor [Member] | |
Business Acquisition [Line Items] | |
Less: transaction costs paid | $ (5,828) |
Merger and Recapitalization -_3
Merger and Recapitalization - Schedule of Merger to Unaudited Condensed Consolidated Statement of Changes in Stockholders' Equity (Deficit) (Details) | 9 Months Ended |
Sep. 30, 2021USD ($) | |
Business Acquisition [Line Items] | |
Less: Fair value of Earnout Consideration and Sponsor Earnout Consideration | $ (14,610) |
Effect of Merger, net of redemptions and transaction costs | 31,270 |
CHAQ [Member] | |
Business Acquisition [Line Items] | |
Cash - trust and cash, net of redemptions | 65,127 |
Less: Fair value of assumed Private Placement Warrants | (13,405) |
CHAQ and Old Renovacor [Member] | |
Business Acquisition [Line Items] | |
Less: transaction costs incurred | $ (5,842) |
Merger and Recapitalization -_4
Merger and Recapitalization - Summary of Number of Shares Common Stock Issued Immediately Following Consummation of Merger (Details) - shares | Sep. 30, 2021 | Sep. 01, 2021 | Dec. 31, 2020 |
Business Acquisition [Line Items] | |||
Common stock, outstanding | 16,756,042 | 1,987,636 | 6,274,566 |
Shares issued - common stock | 16,756,042 | 1,987,636 | 6,274,566 |
Total shares of common stock immediately after Merger | 17,256,042 | ||
CHAQ [Member] | |||
Business Acquisition [Line Items] | |||
Common stock, outstanding prior to Merger | 8,622,644 | ||
Less: redemption of CHAQ shares | (2,112,100) | ||
Common stock, outstanding | 6,510,544 | ||
CHAQ Founder shares | 2,155,661 | ||
PIPE Investment [Member] | |||
Business Acquisition [Line Items] | |||
Shares issued | 2,284,776 | ||
Old Renovacor [Member] | |||
Business Acquisition [Line Items] | |||
Common stock, outstanding prior to Merger | 1,987,636 | ||
Shares issued - common stock | 6,305,061 | ||
Merger and PIPE Financing [Member] | |||
Business Acquisition [Line Items] | |||
Common stock, outstanding | 10,950,981 |
Merger and Recapitalization -_5
Merger and Recapitalization - Summary of Number of Shares Common Stock Issued Immediately Following Consummation of Merger (Parenthetical) (Detail) | 9 Months Ended |
Sep. 30, 2021shares | |
Sponsor Support Agreement [Member] | |
Business Acquisition [Line Items] | |
Common stock held in escrow and subject to vesting or forfeiture | 500,000 |
Old Renovacor [Member] | |
Business Acquisition [Line Items] | |
Preferred stock outstanding prior to Merger | 2,578,518 |
Common stock outstanding prior to Merger | 1,987,636 |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Liabilities Measured at Fair Value on Recurring Basis (Details) - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
Liabilities | ||
Liabilities fair value | $ 0 | |
Fair Value, Recurring | ||
Liabilities | ||
Liabilities fair value | $ 30,877,000 | |
Fair Value, Recurring | Level 3 | ||
Liabilities | ||
Liabilities fair value | 30,877,000 | |
Fair Value, Recurring | Warrant Liability | ||
Liabilities | ||
Liabilities fair value | 14,840,000 | |
Fair Value, Recurring | Warrant Liability | Level 3 | ||
Liabilities | ||
Liabilities fair value | 14,840,000 | |
Fair Value, Recurring | Share Earnout Liability | ||
Liabilities | ||
Liabilities fair value | 16,037,000 | |
Fair Value, Recurring | Share Earnout Liability | Level 3 | ||
Liabilities | ||
Liabilities fair value | $ 16,037,000 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Details) | Dec. 31, 2020USD ($) |
Fair Value Disclosures [Abstract] | |
Asset fair value | $ 0 |
Liabilities fair value | $ 0 |
Fair Value Measurements - Sch_2
Fair Value Measurements - Schedule of Warrant and Earnout Share Liability Measured on Recurring Basis Using Unobservable Input (Details) - Level 3 $ in Thousands | 9 Months Ended | |
Sep. 30, 2021USD ($) | ||
Warrant Liability | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assumed warrants due to Merger | $ 13,405 | [1] |
Change in the fair value of liability | 1,435 | |
Balance | 14,840 | |
Share Earnout Liability | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Issuance of earn-out shares | 14,610 | [1] |
Change in the fair value of liability | 1,427 | |
Balance | $ 16,037 | |
[1] | Represents fair value on the Closing Date. |
Fair Value Measurements - Sch_3
Fair Value Measurements - Schedule of Assumptions Used in Determining Fair Value of Private Placement Warrants (Details) - Private Placement Warrants [Member] | Sep. 02, 2021$ / shares | Sep. 30, 2021$ / shares |
Stock Price [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Derivative Liability, Measurement Input | 8.41 | 9.05 |
Strike Price [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Derivative Liability, Measurement Input | 11.50 | 11.50 |
Expected Volatility [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Derivative Liability, Measurement Input | 75 | 75 |
Risk-Free Interest Rate [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Derivative Liability, Measurement Input | 0.54 | 0.66 |
Expected Term (Years) [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Derivative Liability, Measurement Input | 3 years 7 months 20 days | 3 years 6 months 21 days |
Fair Value Per Warrant [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Derivative Liability, Measurement Input | 3.83 | 4.24 |
Fair Value Measurements - Sch_4
Fair Value Measurements - Schedule of Assumptions Used in Determining Fair Value of Earnout Shares (Details) - Earnout Shares [Member] | Sep. 02, 2021$ / shares | Sep. 30, 2021$ / shares |
Stock Price [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Derivative Liability, Measurement Input | 8.41 | 9.05 |
Probability of Change in Control [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Derivative Liability, Measurement Input | 7.5 | 7.5 |
Expected Volatility [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Derivative Liability, Measurement Input | 75 | 75 |
Risk-Free Interest Rate [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Derivative Liability, Measurement Input | 0.97 | 1.19 |
Expected Term (Years) [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Derivative Liability, Measurement Input | 6 years 3 months 29 days | 6 years 3 months |
Fair Value Per Share [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Derivative Liability, Measurement Input | 6.03 | 6.62 |
Prepaid Expenses and Other Cu_3
Prepaid Expenses and Other Current Assets - Summary of Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 | |
Prepaid Expense and Other Assets, Current [Abstract] | |||
Research and development costs | $ 393 | $ 90 | |
Insurance | 1,825 | 15 | |
Other | 417 | 2 | |
Total prepaid expenses and other current assets | $ 2,635 | $ 107 | [1] |
[1] | The condensed balance sheet at December 31, 2020 has been derived from the audited financial statements at that date. |
Accrued Expenses - Schedule of
Accrued Expenses - Schedule of Accrued Expenses (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 | |
Payables And Accruals [Abstract] | |||
Employee compensation and benefits | $ 400 | $ 35 | |
External research and development expenses | 965 | 22 | |
Merger-related costs | 261 | ||
Professional fees and other | 558 | ||
Total accrued expenses | $ 2,184 | $ 57 | [1] |
[1] | The condensed balance sheet at December 31, 2020 has been derived from the audited financial statements at that date. |
License and Sponsored Researc_2
License and Sponsored Research Agreements - Additional Information (Details) - USD ($) | Jul. 01, 2021 | Nov. 30, 2020 | Aug. 31, 2019 | Sep. 30, 2021 | Sep. 30, 2020 | Jun. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 |
Research And Development Arrangement Contract To Perform For Others [Line Items] | ||||||||
Research and development expenses | $ 2,925,000 | $ 892,000 | $ 7,413,000 | $ 1,868,000 | ||||
Common Stock [Member] | ||||||||
Research And Development Arrangement Contract To Perform For Others [Line Items] | ||||||||
Common stock, shares issued | 536,054 | |||||||
Temple License Agreement [Member] | ||||||||
Research And Development Arrangement Contract To Perform For Others [Line Items] | ||||||||
Agreement effective date | Aug. 12, 2019 | |||||||
Assignment fees | $ 100,000 | |||||||
Development regulatory and commercial milestone payment | $ 1,250,000 | |||||||
Royalty percentage | 50.00% | |||||||
Agreement expiration description | The Temple License Agreement will remain effective until (i) the expiration date of the last-to-expire patents covered under the License Agreement (currently expected to occur in 2041); (ii) the termination by Temple upon (a) an uncured breach by the Company, with a 60-day notification period, (b) the Company’s filing of a voluntary petition in bankruptcy or related proceeding, providing such petition is not dismissed within 90 days after the filing thereof, (c) a failure by the Company to meet certain milestones set forth in the Licensed Agreement, or (d) non-payment of undisputed monies due to Temple, with a 30-day notification period. Additionally, the Company may terminate the entire agreement or with respect to an individual patent or patent application, if desired, subject a 90-day notification period. | |||||||
Preclinical term | 3 years | |||||||
Sponsored research agreement fund | $ 900,000 | |||||||
Sponsored research agreement fund, net | $ 5,300,000 | |||||||
Sponsor research agreement funded and/or incurred from inception | 1,100,000 | $ 1,100,000 | ||||||
Research and development expenses | $ 500,000 | $ 100,000 | $ 700,000 | $ 300,000 | ||||
Temple License Agreement [Member] | Minimum [Member] | ||||||||
Research And Development Arrangement Contract To Perform For Others [Line Items] | ||||||||
Annual administrative fee | $ 20,000 | |||||||
Temple License Agreement [Member] | Common Stock [Member] | ||||||||
Research And Development Arrangement Contract To Perform For Others [Line Items] | ||||||||
Common stock, shares issued | 97,879 | |||||||
Additional shares issued upon closing of Series A convertible preferred stock | 9,130 |
Stockholder's Equity - Addition
Stockholder's Equity - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions | Sep. 01, 2021 | Sep. 30, 2021 | Dec. 31, 2020 |
Class Of Stock [Line Items] | |||
Common stock, shares authorized | 6,000,000 | 100,000,000 | 100,000,000 |
Common stock, par value | $ 0.0001 | $ 0.0001 | |
Common stock, shares issued | 1,987,636 | 16,756,042 | 6,274,566 |
Common stock, shares outstanding | 1,987,636 | 16,756,042 | 6,274,566 |
Preferred stock, shares authorized | 1,000,000 | 1,000,000 | |
Preferred stock, par value | $ 0.0001 | $ 0.0001 | |
Number of voting rights | no | ||
Public Warrants | |||
Class Of Stock [Line Items] | |||
Number of warrants outstanding | 8,622,644 | ||
Exercise price | $ 11.50 | ||
Warrant or Right, Reason for Issuance, Description | The Company may redeem the Public Warrants:in whole and not in part;at a price of $0.01 per Public Warrant;at any time during the exercise period;upon a minimum of 30 days’ prior written notice of redemption;if, and only if, the last sale price of the Company’s common stock equals or exceeds $16.00 per share for any 10 trading days within a 30-trading day period ending on the third business day prior to the date on which the Company sends the notice of redemption to the warrant holders; andif, and only if, there is a current registration statement in effect with respect to the shares of common stock underlying such Public Warrants at the time of redemption and for the entire 30-day trading period referred to above and continuing each day thereafter until the date of redemption. | ||
Redemption written notice period | 30 days | ||
Common stock exceeds price per share | $ 16 | ||
Private Placement Warrants [Member] | |||
Class Of Stock [Line Items] | |||
Number of warrants outstanding | 3,500,000 | ||
Exercise price | $ 11.50 | ||
Warrant exercisable term | 5 years | ||
Series A Redeemable Convertible Preferred Stock [Member] | |||
Class Of Stock [Line Items] | |||
Temporary equity, authorized | 3,333,283 | ||
Temporary equity, par value | $ 0.0001 | ||
Temporary equity, issued | 2,578,518 | ||
Temporary equity, outstanding | 2,578,518 | ||
Temporary equity shares issued price per share | $ 4.065063 | ||
Price per share | $ 12.20 | ||
Proceeds from initial public offer | $ 60 | ||
Temporary Equity Conversion Into Permanent Equity Conversion Price Per | $ 4.065063 |
Stockholder's Equity - Summary
Stockholder's Equity - Summary of Outstanding Warrants to Purchase Shares of Common Stock (Details) | Sep. 30, 2021$ / sharesshares | |
Class of Warrant or Right [Line Items] | ||
Number of Shares Outstanding | 12,837,868 | |
Liability Classified Warrants [Member] | ||
Class of Warrant or Right [Line Items] | ||
Number of Shares Outstanding | 3,500,000 | |
Liability Classified Warrants [Member] | April 2020 Private Placement Warrants [Member] | ||
Class of Warrant or Right [Line Items] | ||
Number of Shares Outstanding | 3,500,000 | [1] |
Weighted-Average Exercise Price | $ / shares | $ 11.50 | [1] |
Expiration Date | Apr. 23, 2025 | [1],[2] |
Equity Classified Warrants [Member] | ||
Class of Warrant or Right [Line Items] | ||
Number of Shares Outstanding | 9,337,868 | |
Equity Classified Warrants [Member] | April 2020 Public Warrants [Member] | ||
Class of Warrant or Right [Line Items] | ||
Number of Shares Outstanding | 8,622,644 | [3] |
Weighted-Average Exercise Price | $ / shares | $ 11.50 | [3] |
Expiration Date | Sep. 2, 2026 | [3] |
Equity Classified Warrants [Member] | September 2021 Pre-Funded Warrants [Member] | ||
Class of Warrant or Right [Line Items] | ||
Number of Shares Outstanding | 715,224 | [4] |
Weighted-Average Exercise Price | $ / shares | $ 0.01 | [4] |
[1] | Private Placement Warrants assumed in the Merger. Each warrant share is exercisable for one share of common stock. | |
[2] | The Private Placement Warrants purchased by Chardan will not be exercisable more than five years from the effective date of the Chardan IPO, in accordance with FINRA Rule 5110(f)(2)(G)(i), as long as Chardan Capital Markets or any of its related persons beneficially own these Private Placement Warrants. Otherwise, such Private Placement Warrants shall expire on September 2, 2026 . | |
[3] | Public Warrants assumed in the Merger. Each warrant share is exercisable for one-half share of common stock, provided, however, each warrant must be exercised in multiples of two. | |
[4] | Pre-Funded Warrant issued in connection with PIPE Investment (Note 3). Each warrant share is exercisable indefinitely for one share of common stock. |
Stockholder's Equity - Summar_2
Stockholder's Equity - Summary of Outstanding Warrants to Purchase Shares of Common Stock (Parenthetical) (Details) | Sep. 30, 2021 |
Private Placement Warrants [Member] | |
Class of Warrant or Right [Line Items] | |
Warrant expiration date | Sep. 2, 2026 |
Stockholder's Equity - Schedule
Stockholder's Equity - Schedule of Common Stock Shares Reserved for Future Issuance (Details) | Sep. 30, 2021shares |
Class Of Stock [Line Items] | |
Common stock, capital shares reserved for future issuance | 12,876,576 |
Pre-Funded Warrants [Member] | |
Class Of Stock [Line Items] | |
Common stock, capital shares reserved for future issuance | 715,224 |
Warrants [Member] | |
Class Of Stock [Line Items] | |
Common stock, capital shares reserved for future issuance | 7,811,322 |
Earnout Shares [Member] | |
Class Of Stock [Line Items] | |
Common stock, capital shares reserved for future issuance | 1,995,362 |
Stock Options Outstanding [Member] | |
Class Of Stock [Line Items] | |
Common stock, capital shares reserved for future issuance | 1,114,131 |
2021 Incentive Plan [Member] | |
Class Of Stock [Line Items] | |
Common stock, capital shares reserved for future issuance | 1,240,537 |
Stock-based Compensation - Addi
Stock-based Compensation - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Maximum Number of Shares Per Employee | 88,991 | |||
Shares expected to vest date | 2021-12 | |||
Fair value of options, vested in period | $ 100 | |||
Unrecognized stock-based expense | $ 4,900 | 4,900 | ||
Stock-based compensation expense | $ 518 | $ 1 | $ 710 | $ 2 |
2018 Stock Option and Grant Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of shares authorized for issuance | 1,118,869 | 1,118,869 | ||
Exchanged options issued | 194,926 | |||
Purchase price per share | $ 5.66 | |||
2021 Omnibus Incentive Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of shares authorized for issuance | 2,229,407 | 2,229,407 | ||
Percentage of outstanding shares | 4.00% | |||
Options granted | 919,205 | |||
Remain available for future issuance | 1,237,656 | 1,237,656 | ||
Additional common stock reserved for future issuance | 72,546 | |||
Common Stock [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of shares purchased for issuance under share-based payment arrangement | 1,041,004 | 37,531 | ||
Earnout RSU [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Committed share issuance | 72,546 | |||
Stock Options [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Options granted | 1,041,004 | |||
Weighted average fair value of options granted | $ 5.22 | $ 0.28 | ||
Vesting period | 3 years 6 months | |||
Restricted Stock [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation expense | $ 100 |
Stock-based Compensation - Sche
Stock-based Compensation - Schedule of Stock-based Compensation Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Stock-based compensation expense | $ 518 | $ 1 | $ 710 | $ 2 |
Research and Development [Member] | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Stock-based compensation expense | 364 | $ 1 | 543 | 1 |
General and Administrative [Member] | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Stock-based compensation expense | $ 154 | $ 167 | $ 1 |
Stock-based Compensation - Sc_2
Stock-based Compensation - Schedule of Assumptions Used in Determining the Fair Value of Option Awards (Details) - Stock Options [Member] | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Expected volatility | 77.70% | 69.40% |
Risk-free Interest Rate | 0.92% | 1.46% |
Expected dividend yield | 0.00% | 0.00% |
Expected term (years) | 5 years 11 months 12 days | 5 years 11 months 8 days |
Stock-based Compensation - Summ
Stock-based Compensation - Summary of Stock Option Activity (Details) - Stock Options [Member] - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock Options Outstanding, Beginning balance | 73,127 | |
Stock Options, Granted | 1,041,004 | |
Stock Options Outstanding, Ending Balance | 1,114,131 | 73,127 |
Stock Options, Exercisable | 55,060 | |
Weighted-Average Exercise Price, Outstanding | $ 0.29 | |
Weighted-Average Exercise Price, Granted | 7.87 | |
Weighted-Average Exercise Price, Outstanding, Ending Balance | 7.37 | $ 0.29 |
Weighted-Average Exercise Price, Exercisable | $ 0.25 | |
Weighted-Average Remaining Contractual Life, Outstanding | 9 years 8 months 12 days | 8 years 4 months 24 days |
Weighted-Average Remaining Contractual Life, Exercisable | 5 years 9 months 18 days | |
Aggregate Intrinsic Value, Outstanding | $ 2,032 | $ 12 |
Aggregate Intrinsic Value, Exercisable | $ 484 | |
Previously Reported [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock Options Outstanding, Beginning balance | 82,179 | |
Stock Options Outstanding, Ending Balance | 82,179 | |
Weighted-Average Exercise Price, Outstanding | $ 0.25 | |
Weighted-Average Exercise Price, Outstanding, Ending Balance | $ 0.25 | |
Retroactive Application of Reverse Recapitalization [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock Options Outstanding, Beginning balance | 9,052 | |
Stock Options Outstanding, Ending Balance | 9,052 | |
Weighted-Average Exercise Price, Outstanding | $ 0.04 | |
Weighted-Average Exercise Price, Outstanding, Ending Balance | $ 0.04 |
Related Parties - Additional In
Related Parties - Additional Information (Details) - USD ($) | Sep. 02, 2021 | Jul. 20, 2021 | Jun. 30, 2020 | Apr. 30, 2020 | Aug. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2021 | Sep. 30, 2020 | Jun. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Sep. 01, 2021 | Dec. 31, 2020 |
Related Party Transaction [Line Items] | |||||||||||||
Common stock, shares outstanding | 16,756,042 | 16,756,042 | 1,987,636 | 6,274,566 | |||||||||
Aggregate purchase price | $ 821,000 | ||||||||||||
Proceeds from convertible debt | $ 2,445,000 | ||||||||||||
Research and development | $ 2,925,000 | $ 892,000 | $ 7,413,000 | $ 1,868,000 | |||||||||
Temple License Agreement [Member] | |||||||||||||
Related Party Transaction [Line Items] | |||||||||||||
Minimum percentage of ownership held by Founder | 5.00% | ||||||||||||
Research and development | 500,000 | 100,000 | $ 700,000 | 300,000 | |||||||||
Convertible Promissory Note [Member] | |||||||||||||
Related Party Transaction [Line Items] | |||||||||||||
Proceeds from convertible debt | $ 2,500,000 | ||||||||||||
Feldman Consulting Agreement [Member] | |||||||||||||
Related Party Transaction [Line Items] | |||||||||||||
Minimum percentage of ownership held by Founder | 5.00% | ||||||||||||
Consulting fee amount per calendar month | $ 8,333.33 | ||||||||||||
Long term service commitment period | 3 years | ||||||||||||
Service commitment renewal term | 1 year | ||||||||||||
Consulting Fees | 25,000 | $ 25,000 | 75,000 | $ 75,000 | |||||||||
Due to related party | $ 8,333 | $ 8,333 | |||||||||||
Merger Agreement and Note Purchase Agreement [Member] | Convertible Promissory Note [Member] | |||||||||||||
Related Party Transaction [Line Items] | |||||||||||||
Issued amount | 2,500,000 | ||||||||||||
Proceeds from convertible debt | $ 2,500,000 | ||||||||||||
Conversion price per share | $ 10 | ||||||||||||
Private Placement Warrants [Member] | |||||||||||||
Related Party Transaction [Line Items] | |||||||||||||
Aggregate shares of common stock (in Shares) | 3,500,000 | ||||||||||||
Exercise price | $ 0.40 | ||||||||||||
Purchase price of warrants | $ 1,400,000 | ||||||||||||
Private Placement [Member] | Merger Agreement [Member] | |||||||||||||
Related Party Transaction [Line Items] | |||||||||||||
Common stock purchased | 2,284,776 | ||||||||||||
Pre - funded warrants to purchase common stock | 715,224 | ||||||||||||
Sponsor Ownership [Member] | |||||||||||||
Related Party Transaction [Line Items] | |||||||||||||
Common stock, shares outstanding | 1,605,661 | 1,605,661 | |||||||||||
Percentage of outstanding shares | 9.60% | 9.60% | |||||||||||
Chardan Healthcare Investments LLC [Member] | |||||||||||||
Related Party Transaction [Line Items] | |||||||||||||
Common stock, shares outstanding | 250,000 | 250,000 | |||||||||||
Sponsor Shares [Member] | |||||||||||||
Related Party Transaction [Line Items] | |||||||||||||
Aggregate shares of common stock (in Shares) | 5,000,000 | ||||||||||||
Aggregate purchase price | $ 25,000 | ||||||||||||
Sponsor cancelled shares (in shares) | 288,089 | 2,556,250 | |||||||||||
Remaining shares owned by sponsor (in Shares) | 2,443,750 | ||||||||||||
Sponsor earnout shares | 500,000 |
Net Loss Per Share - Schedule o
Net Loss Per Share - Schedule of Potentially Antidilutive Securities Excluded from Computation of Diluted Net Loss Per Share (Detail) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||||
Anti-dilutive Securities | 15,732,137 | 73,127 | 15,732,137 | 73,127 |
Stock Options [Member] | ||||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||||
Anti-dilutive Securities | 1,114,131 | 73,127 | 1,114,131 | 73,127 |
Common Stock Warrants [Member] | ||||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||||
Anti-dilutive Securities | 12,122,644 | 12,122,644 | ||
Earnout Shares [Member] | ||||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||||
Anti-dilutive Securities | 2,495,362 | 2,495,362 |