Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2021 | Mar. 31, 2022 | Jun. 30, 2021 | |
Document and Entity Information [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Document Period End Date | Dec. 31, 2021 | ||
Entity File Number | 001-39752 | ||
Entity Registrant Name | PETROS PHARMACEUTICALS, INC. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 85-1410058 | ||
Entity Address State Or Province | NY | ||
Entity Address, Address Line One | 1185 Avenue of the Americas | ||
Entity Address, Address Line Two | 3rd Floor | ||
Entity Address, City or Town | New York | ||
Entity Address, Postal Zip Code | 10036 | ||
City Area Code | 973 | ||
Local Phone Number | 242-0005 | ||
Title of 12(b) Security | Common Stock | ||
Trading Symbol | PTPI | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | true | ||
Entity Ex Transition Period | false | ||
ICFR Auditor Attestation Flag | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 20,060,345 | ||
Entity Common Stock, Shares Outstanding | 20,684,723 | ||
Entity Central Index Key | 0001815903 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2021 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Auditor Name | EisnerAmper LLP | ||
Auditor Location | Iselin, New Jersey | ||
Auditor Firm ID | 274 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash | $ 23,847,572 | $ 17,139,694 |
Accounts receivable, net | 2,455,386 | 5,152,969 |
Inventories | 519,649 | 760,530 |
Deposits with related party | 4,576 | |
Prepaid expenses and other current assets | 3,720,088 | 2,847,284 |
Total current assets | 30,542,695 | 25,905,053 |
Fixed assets, net | 49,397 | 64,250 |
Intangible assets, net | 25,293,149 | 32,160,919 |
API purchase commitment | 11,029,260 | 11,144,257 |
Other assets | 475,557 | 579,535 |
Total assets | 67,390,058 | 69,854,014 |
Current liabilities: | ||
Current portion of senior debt, net | 7,175,029 | |
Accounts payable | 4,557,969 | 5,609,556 |
Accrued expenses | 11,957,384 | 14,683,786 |
Accrued inventory purchases | 14,203,905 | 14,203,905 |
Other current liabilities | 260,818 | 221,766 |
Total current liabilities | 30,980,076 | 41,894,042 |
Derivative liability | 460,000 | 9,890,000 |
Other long-term liabilities | 405,018 | 600,920 |
Total liabilities | 31,845,094 | 52,384,962 |
Stockholders' Equity | ||
Preferred stock (par value of $0.0001 per share, 50,000,000 shares authorized, 0 and 500 shares issued and outstanding as of December 31, 2021 and December 31, 2020, respectively) | ||
Common stock (par value of $0.0001 per share, 150,000,000 shares authorized, 20,684,723 and 9,707,655 shares issued and outstanding as of December 31, 2021 and December 31, 2020, respectively) | 2,068 | 971 |
Additional paid-in capital | 106,231,716 | 79,170,225 |
Accumulated deficit | (70,688,820) | (61,702,144) |
Total Stockholders' Equity | 35,544,964 | 17,469,052 |
Total Liabilities and Stockholders' Equity | $ 67,390,058 | $ 69,854,014 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2021 | Dec. 31, 2020 |
CONSOLIDATED BALANCE SHEETS | ||
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 50,000,000 | 50,000,000 |
Preferred stock, shares issued | 0 | 500 |
Preferred stock, shares outstanding | 0 | 500 |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 150,000,000 | 150,000,000 |
Common stock, shares issued | 20,684,723 | 9,707,655 |
Common stock, shares outstanding | 20,684,723 | 9,707,655 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
CONSOLIDATED STATEMENTS OF OPERATIONS | ||
Net sales | $ 7,811,264 | $ 9,559,469 |
Cost of goods sold | 1,599,566 | 4,046,466 |
Gross profit | 6,211,698 | 5,513,003 |
Operating expenses: | ||
Selling, general and administrative | 15,593,233 | 15,674,968 |
Research and development expense | 1,788,491 | 459,636 |
Depreciation and amortization expense | 6,877,990 | 6,660,438 |
Total operating expenses | 24,259,714 | 22,795,042 |
Loss from operations | (18,048,016) | (17,282,039) |
Change in fair value of derivative liability | 9,430,000 | (1,680,000) |
Interest expense, senior debt | (368,660) | (1,323,424) |
Interest expense, subordinated related party term loans | (1,727,455) | |
Loss before income taxes | (8,986,676) | (22,012,918) |
Income tax benefit | 0 | (1,426,993) |
Net loss | $ (8,986,676) | $ (20,585,925) |
Net loss per common stock | ||
Basic (in dollars per share) | $ (0.83) | $ (3.85) |
Diluted (in dollars per share) | $ (0.83) | $ (3.85) |
Weighted average common shares outstanding | ||
Basic | 10,889,766 | 5,340,682 |
Diluted | 10,889,766 | 5,340,682 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) | Preferred Units | Common Units | Preferred Stock | Common Stock | Paid-in Capital | Accumulated Deficit | Total |
Balance at Dec. 31, 2019 | $ 20,018,205 | $ 29,117,233 | $ 0 | $ 0 | $ 0 | $ (41,116,219) | $ 8,019,219 |
Balance (in shares) at Dec. 31, 2019 | 1,619,754 | 3,434,551 | 0 | 0 | |||
Conversion of related party debt/ subordinated related party term loans into Preferred and Common Units | $ 17,227,455 | 17,227,455 | |||||
Conversion of related party debt/ subordinated related party term loans into Preferred and Common Units (in shares) | 1,762,913 | ||||||
Proceeds from exercise of warrants | $ 20,551 | 20,551 | |||||
Proceeds from exercise of warrants ( in shares) | 2,055,115 | ||||||
Net proceeds received from recapitalization for the Mergers | $ (20,038,756) | $ (46,344,688) | $ 971 | 87,380,223 | 20,997,750 | ||
Net proceeds received from recapitalization for the Mergers (in shares) | (3,674,869) | (5,197,464) | 500 | 9,707,655 | |||
Bifurcation of derivative liability related to the Mergers contingent consideration | (8,209,998) | (8,209,998) | |||||
Net loss | (20,585,925) | (20,585,925) | |||||
Balance at Dec. 31, 2020 | $ 0 | $ 0 | $ 0 | $ 971 | 79,170,225 | (61,702,144) | 17,469,052 |
Balance (in shares) at Dec. 31, 2020 | 0 | 0 | 500 | 9,707,655 | |||
Conversion of related party debt/ subordinated related party term loans into Preferred and Common Units | $ 6 | (6) | |||||
Conversion of related party debt/ subordinated related party term loans into Preferred and Common Units (in shares) | (500) | 60,606 | |||||
Issuance of Common Stock | $ 884 | 21,744,119 | 21,745,003 | ||||
Issuance of Common Stock (in shares) | 8,843,538 | ||||||
Proceeds from exercise of warrants | $ 201 | 4,012,234 | 4,012,435 | ||||
Proceeds from exercise of warrants ( in shares) | 2,014,586 | ||||||
Stock-based Compensation Expense | 1,117,348 | 1,117,348 | |||||
Non-employee stock-based compensation | $ 6 | 187,796 | 187,802 | ||||
Non-employee stock-based compensation (in shares) | 58,338 | ||||||
Net loss | (8,986,676) | (8,986,676) | |||||
Balance at Dec. 31, 2021 | $ 2,068 | $ 106,231,716 | $ (70,688,820) | $ 35,544,964 | |||
Balance (in shares) at Dec. 31, 2021 | 20,684,723 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Cash flows from operating activities: | ||
Net loss | $ (8,986,676) | $ (20,585,925) |
Adjustments to reconcile net loss to net cash (used in) operating activities: | ||
Depreciation and amortization | 6,877,990 | 6,660,438 |
Bad debt expense | 148,885 | 202,525 |
Inventory and sample inventory reserve | (200,251) | 1,752,041 |
Non-cash paid-in-kind interest | 1,771,904 | |
Amortization of deferred financing costs and debt discount | 12,500 | 37,500 |
Accretion for end of term fee | 116,196 | |
Deferred tax benefit | 0 | (1,432,166) |
Lease expense | 103,978 | 92,711 |
Derivative liability | (9,430,000) | 1,680,000 |
Deferred Revenue | 70,343 | |
Stock based Compensation | 1,117,348 | |
Non-employee Stock Compensation | 187,802 | |
Changes in operating assets and liabilities: | ||
Accounts receivable | 2,548,698 | (2,750,364) |
Inventories | 412,744 | 728,286 |
Deposits | 4,576 | 1,734 |
Prepaid expenses and other current assets | (724,785) | 1,031,108 |
Accounts payable | (1,051,587) | 2,222,114 |
Accrued expenses | (2,726,403) | (6,203,476) |
Accrued inventory purchases | (250,000) | |
Other current liabilities | (31,291) | (231,325) |
Long-term liabilities | (195,902) | (148,626) |
Net cash used in operating activities | (11,862,031) | (15,305,325) |
Cash flows from investing activities: | ||
Acquisition of fixed assets | (4,633) | |
Net cash used in investing activities | (4,633) | |
Cash flows from financing activities: | ||
Proceeds received related to the recapitalization from the Mergers | 22,592,285 | |
Payment of equity issuance costs | (1,042,910) | |
Payment of senior debt | (6,653,292) | (6,181,711) |
Payment of portion of senior debt end of term fee | (534,237) | (534,375) |
Payment of debt issuance costs | (50,000) | |
Proceeds from subordinated related party term loans | 15,500,000 | |
Proceeds from Issuance of Common Stock | 21,745,003 | |
Proceeds from the exercise of warrants | 4,012,435 | 20,551 |
Net cash provided by financing activities | 18,569,909 | 30,303,840 |
Net increase in cash | 6,707,878 | 14,993,882 |
Cash, beginning of year | 17,139,694 | 2,145,812 |
Cash, end of year | 23,847,572 | 17,139,694 |
Supplemental cash flow information: | ||
Cash paid for interest during the year | 421,821 | 1,191,400 |
Noncash Items: | ||
Noncash decrease in API purchase commitment | 114,997 | |
Noncash decrease in other current assets: API purchase commitment | $ (114,997) | |
Conversion of subordinated related party term loans into preferred and common stocks | 17,227,455 | |
Noncash increase in API Inventory (other assets) | 5,148,311 | |
Deferred Merger costs reclassified to additional paid-in capital | $ 551,625 |
Nature of Operations, Basis of
Nature of Operations, Basis of Presentation, and Liquidity | 12 Months Ended |
Dec. 31, 2021 | |
Nature of Operations, Basis of Presentation, and Liquidity | |
Nature of Operations, Basis of Presentation, and Liquidity | 1) Nature of Operations, Basis of Presentation, and Liquidity Nature of Operations and Basis of Presentation Petros Pharmaceuticals, Inc. (“Petros” or the “Company”) was incorporated in Delaware on May 14, 2020 for the purpose of effecting the transactions contemplated by that certain Agreement and Plan of Merger, dated as of May 17, 2020 (as amended, the “Merger Agreement”), by and between Petros, Neurotrope, Inc., a Nevada corporation (“Neurotrope”), PM Merger Sub 1, LLC, a Delaware corporation and a wholly-owned subsidiary of Petros (“Merger Sub 1”), PN Merger Sub 2, Inc., a Delaware corporation and a wholly-owned subsidiary of Petros (“Merger Sub 2”), and Metuchen Pharmaceuticals LLC, a Delaware corporation (“Metuchen”). The Merger Agreement provided for (1) the merger of Merger Sub 1, with and into Metuchen, with Metuchen surviving as a wholly-owned subsidiary of Petros (the “Metuchen Merger”) and (2) the merger of Merger Sub 2 with and into Neurotrope, with Neurotrope surviving as a wholly-owned subsidiary of Petros (the “Neurotrope Merger” and together with the Metuchen Merger, the “Mergers”). As a result of the Mergers, Metuchen and Neurotrope became wholly-owned subsidiaries of Petros, and Petros became a publicly traded corporation on December 1, 2020. On December 7, 2020, Neurotrope completed the spin-off of certain assets, whereby (i) any cash in excess of $20,000,000, subject to adjustment as provided in the Merger Agreement, and all of the operating assets and liabilities of Neurotrope not retained by Neurotrope in connection with the Mergers were contributed to Synaptogenix, Inc. (formerly known as Neurotrope Bioscience, Inc. and a wholly owned subsidiary of Neurotrope prior to the spin-off), a Delaware corporation (“Synaptogenix”) and (ii) holders of record of Neurotrope common stock, par value $0.0001 per share, Neurotrope preferred stock, par value $0.001 per share and certain warrants as of November 30, 2020 received a pro rata distribution of common stock of Synaptogenix, resulting in a separate, independent publicly traded company. The Mergers were accounted for as a reverse recapitalization in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Metuchen was determined to be the accounting acquirer based on an analysis of the criteria outlined in the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”) No. 805, Business Combinations All transactions between the consolidated entities have been eliminated in consolidation. Liquidity We have experienced net losses and negative cash flows from operations since our inception. As of December 31, 2021, we had cash of $23.8 million, negative working capital of $0.4 million, and accumulated deficit of $70.7 million. Our plans include, or may include, utilizing our cash and cash equivalents on hand, as well as exploring additional ways to raise capital in addition to increasing cash flows from operations. In January 2022, the Company executed a promissory note in favor of Vivus in connection with the Vivus Settlement Agreement in the principal amount of $10,201,758. The terms of this promissory note are discussed in Note 14. The Company believes the cash on hand is sufficient to fund operations and debt service through at least March 31, 2023, however for periods after March 31, 2023, the Company may need to raise additional funds or curtail certain discretionary expenditures in order to maintain an appropriate level of cash to fund our operations. While we are optimistic that we will be successful in our efforts to achieve our plans, there can be no assurances that we will be successful in doing so. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2021 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | 2) Summary of Significant Accounting Policies Use of Estimates The preparation of Consolidated Financial Statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities at the date of the Consolidated Financial Statements and reported amounts of revenue and expenses during the reporting periods. Such estimates include the adequacy of accounts receivable reserves, return reserves, inventory reserves, assessment of long-lived assets, including intangible asset impairment, the allocation of the purchase price in acquisitions and the valuation of the derivative liability, among others. Actual results could differ from these estimates and changes in these estimates are recorded when known. Risks and Uncertainties The Company is subject to risks common to companies in the pharmaceutical industry including, but not limited to, uncertainties related to commercialization of competitor products, regulatory approvals, dependence on key products, dependence on key customers and suppliers, and protection of intellectual property rights. The World Health Organization (“WHO”) declared the coronavirus (“COVID-19”) a global pandemic on March 11, 2020, and since that time many of the previously imposed restrictions and other measures which were instituted in response have been subsequently reduced or lifted. However, the COVID-19 pandemic remains highly unpredictable and dynamic, and its duration and extent continue to be dependent on various developments, such as the emergence of variants to the virus that may cause additional strains of COVID-19, the administration and ultimate effectiveness of vaccines, and the eventual timeline to achieve a sufficient level of herd immunity among the general population. Accordingly, the COVID-19 pandemic may continue to have negative effects on the health of the U.S. economy for the foreseeable future. The Company cannot reasonably estimate the length or severity of the impact that the COVID-19 pandemic, including the emergence of any new variants, such as the Delta and the Omicron variants, will have on its financial results, and the Company may experience a material adverse impact on its sales, results of operations, and cash flows in fiscal 2022 and beyond. During 2020, government regulations and the voluntary business practices of the Company and prescribing physicians had prevented in-person visits by sales representatives to physicians’ offices. The Company had taken steps to mitigate the negative impact on its businesses of such restrictions. In March 2020, the Company reduced our sales representative head count to reflect the lack of in-person visits. The Company has maintained a core sales team which continued to contact physicians via telephone and videoconference as well as continuing to have webinars provided by the Company’s key opinion leaders to other physicians and pharmacists. In response to the spread of COVID-19, in March 2020, the Company closed its administrative offices and as of December 31, 2021, they remain closed, with the Company’s employees continuing their work remotely. The Company has selectively resumed in-person interactions by its customer-facing personnel in compliance with local and state restrictions. The Company also continues to engage with customers virtually as the Company seeks to continue to support healthcare professionals and patient care. However, the Company’s ability to engage in personal interactions with physicians and customers remains limited, and it is unknown when the Company’s offices will reopen, and these interactions will be fully resumed. In addition, since the beginning of the COVID-19 pandemic, we have experienced a shift from in-person sales to online, telehealth-based sales. These online sales generally have lower gross margins than in-person sales, which has impacted our net revenues. Concentration of Credit Risk Financial instruments that subject the Company to concentrations of credit risk includes cash. The Company maintains cash on deposit at U.S.-based banks in amounts which, at times, may be in excess of insured limits. Cash and Cash Equivalents The Company considers all highly-liquid investments that have maturities of three months or less when acquired to be cash equivalents. Segment Reporting Operating segments are components of a Company for which separate financial information is available and evaluated regularly by the chief operating decision maker in assessing performance and deciding how to allocate resources. The Company’s two segments, Prescription Medications and Medical Devices, focus on the treatment of male erectile dysfunction. The Prescription Medications segment consists primarily of operations related to Stendra®, which is sold generally in the United States, and H100™ for the treatment of Peyronie’s disease. The Medical Devices segment consists primarily of operations related to vacuum erection devices, which are sold domestically and internationally. See Note 18 Segment Reporting. Revenue Recognition Prescription Medication Sales The Company’s prescription medication sales consist of sales of Stendra® in the U.S. for the treatment of male erectile dysfunction. Under ASC Topic 606, Revenue Recognition In determining the transaction price, a significant financing component does not exist since the timing from when the Company delivers Stendra® to when the customers pay for the product is typically less than one year. The Company records prescription medication sales net of any variable consideration, including but not limited to discounts, rebates, returns, chargebacks, and distribution fees. The Company uses the expected value method when estimating its variable consideration, unless terms are specified within contracts. The identified variable consideration is recorded as a reduction of revenue at the time revenues from sales of Stendra® are recognized. The Company recognizes revenue to the extent that it is probable that a significant revenue reversal will not occur in a future period. These estimates may differ from actual consideration received. The Company evaluates these estimates each reporting period to reflect known changes. As of December 31, 2021 and 2020, the reserves for sales deductions were $4.7 million and $8.6 million, respectively. The most significant sales deductions included in this reserve relate to returns, contract rebates, and distribution service (“DSA”) fees. Our estimates are based on factors such as our direct and indirect customers’ buying patterns and the estimated resulting contractual deduction rates, historical experience, specific known market events and estimated future trends, current contractual and statutory requirements, industry data, estimated customer inventory levels, current contract sales terms with our direct and indirect customers, and other competitive factors. Significant judgment and estimation is required in developing the foregoing and other relevant assumptions. The most significant sales deductions are further described below. Product Returns Consistent with industry practice, the Company maintains a return policy that generally allows its customers to return Stendra® and receive credit for product within six months prior to expiration date and up to one year after expiration date. The provision for returns is based upon the Company’s estimates for future Stendra® returns and historical experience. The provision of returns is part of the variable consideration recorded at the time revenue is recognized. As of December 31, 2021 and 2020, the reserves for product returns were $3.8 million and $7.1 million, respectively, and are included as a component of accrued expenses. Contract Rebates, Coupon Redemptions and DSA Fees The Company establishes contracts with wholesalers, chain stores, and indirect customers that provide for rebates, sales incentives, DSA fees and other allowances. Some customers receive rebates upon attaining established sales volumes. Direct rebates are generally rebates paid to direct purchasing customers based on a percentage applied to a direct customer’s purchases from us, including fees paid to wholesalers under our DSAs, as described below. Indirect rebates are rebates paid to indirect customers that have purchased our products from a wholesaler under a contract with us. The Company has entered into DSAs with certain of our significant wholesaler customers that obligate the wholesalers, in exchange for fees paid by us, to: (i) manage the variability of their purchases and inventory levels within specified limits based on product demand and (ii) provide us with specific services, including the provision of periodic retail demand information and current inventory levels for our pharmaceutical products held at their warehouse locations. See Note 3. Accounts Receivable, net for further discussion of these reserves. Medical Device Sales The Company’s medical device sales consist of domestic and international sales of men’s health products for the treatment of erectile dysfunction. The men’s health products do not require a prescription and include Vacuum Erection Devices, PreBoost, VenoSeal, penile injections (Rx), and urinary tract infection tests. Under Topic 606, the Company recognizes revenue from medical device sales when its performance obligations with its customers have been satisfied. In the contracts with its customers, the Company has identified a single performance obligation to provide medical devices upon receipt of a customer order. The performance obligation is satisfied at a point in time when the Company’s customers obtain control of the medical device, which is typically upon shipment. The Company invoices its customers after the medical devices have been shipped and invoice payments are generally due within 30 days of invoice date for domestic customers and 90 days for international customers. In determining the transaction price, a significant financing component does not exist since the timing from when the Company delivers the medical devices to when the customers pay for the product is typically less than one year. The Company records medical device sales net of any variable consideration, including but not limited to returns. The Company uses the expected value method when estimating its variable consideration. The identified variable consideration is recorded as a reduction of revenue at the time revenues from the medical device sales are recognized. The Company recognizes revenue to the extent that it is probable that a significant revenue reversal will not occur in a future period. These estimates may differ from actual consideration received. The Company evaluates these estimates each reporting period to reflect known changes. Product Returns Consistent with industry practice, the Company maintains a return policy that generally allows its customers to return medical devices and receive credit for products within 90 days of the sale. The provision for returns is based upon the Company’s estimates for future product returns and historical experience. The Company has not made significant changes to the judgments made in applying Topic 606. As of December 31, 2021 and 2020, the reserves for product returns for medical devices were not significant. Contract Costs In relation to customer contracts, the Company incurs costs to fulfill a contract but does not incur costs to obtain a contract. These costs to fulfill a contract do not meet the criteria for capitalization and are expensed as incurred. As such, the Company did not have any contract assets at December 31, 2021 and 2020. Accounts Receivable, net The Company extends credit to its customers in the normal course of business. Accounts receivable are recorded at the invoiced amount, net of chargebacks, distribution service fees, and cash discounts. Management determines each allowance based on historical experience along with the present knowledge of potentially uncollectible accounts. See Note 3 Accounts Receivable, net. Inventories Inventories consist of finished goods held for sale and raw materials. Inventories are stated at the lower of cost or net realizable value, with cost determined using the first-in, first-out method. Inventories are adjusted for excess and obsolescence. Evaluation of excess inventory includes such factors as expiry date, inventory turnover, and management’s assessment of current product demand. See Note 4 Inventories. Intangible Assets The Company accounts for recognized intangible assets at cost. Intangible assets with finite useful lives are amortized over the useful life that the assets are expected to contribute directly or indirectly to future cash flows. Intangible assets are amortized using an accelerated method based on the pattern in which the economic benefits of the assets are consumed. The Company reviews the carrying value and useful lives of its intangible assets with definite lives whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable or the period over which they should be amortized has changed. When indicators of impairment exist, the Company determines whether the estimated undiscounted sum of the future cash flows of such assets is less than their carrying amounts. If less, an impairment loss is recognized in the amount, if any, by which the carrying amount of such assets exceeds their respective fair values. The Company evaluates the remaining useful life of each intangible asset that is being amortized during each reporting period to determine whether events and circumstances warrant a revision to the remaining period of amortization. If the estimate of the intangible asset’s remaining useful life has changed, the remaining carrying amount of the intangible asset is amortized prospectively over that revised remaining useful life. The Company has determined that no impairment exists as of December 31, 2021. As indicators of impairment exist as of December 31, 2021, the Company prepared an undiscounted cash flow analysis. This analysis includes projections of future revenue and expenses, which if not achieved could result in future impairment charges. These projections include continued significant sales growth based in part on the increase in revenue in 2021, along the expectation of higher sales volume resulting from increased product availability as a result of the Vivus settlement. Additionally, the Company is planning to invest in research and development pursuant to our Non-Prescription / Over-The-Counter ("OTC") Strategies related to Stendra®, which we anticipate will dramatically increase product sales in the future. Given the impact of the COVID-19 outbreak on the global economy, as well as its potential impact to the Company’s business operations and cash flows, the Company constituted the COVID-19 outbreak as a triggering event requiring an impairment test for its long-lived assets with finite useful lives. The Company’s projections included the undiscounted cash flows of the remaining estimated useful lives for the Stendra product through December 2028 and December 2030 for the medical device products. Based on the impairment assessment as of December 31, 2021, and 2020, the Company determined that no intangible asset impairment occurred as the undiscounted cash flows exceeded the respective carrying values of the assets. The Company did not record any impairments of intangible assets for the years ended December 31, 2021 and 2020. Fixed Assets Fixed assets consist of furniture and fixtures. Furniture and fixtures are recorded at cost, less accumulated depreciation, and are depreciated on a straight-line basis over its estimated useful life. The Company uses an estimated useful life of 7 years for furniture and fixtures. Depreciation expense for each of the years ended December 31, 2021 and 2020 was $10,220. Leases The Company accounts for leases in accordance with Accounting Standards Codification (“ASC”) Topic 842. Topic 842 requires organizations to recognize leased assets and liabilities on the balance sheet. The standard also requires disclosures to help investors and other financial statement users better understand the amount, timing and uncertainty of cash flows arising from leases. The Company determines if an arrangement is a lease at inception. This determination generally depends on whether the arrangement conveys to the Company the right to control the use of an explicitly or implicitly identified fixed asset for a period of time in exchange for consideration. Control of an underlying asset is conveyed to the Company if the Company obtains the rights to direct the use of and to obtain substantially all of the economic benefits from using the underlying asset. The Company has lease agreements that include lease and non-lease components, which the Company accounts for as a single lease component for all leases. Operating lease right-of-use (“ROU”) assets are included in other assets whereas operating lease liabilities are included in other current liabilities and other long-term liabilities on the Company’s consolidated balance sheets. Operating lease ROU assets and operating lease liabilities are recognized at commencement date based on the present value of lease payments over the lease term. The operating lease payments are recognized as lease expense on a straight-line basis over the lease term. Lease payments included in the measurement of the lease liability are comprised of fixed payments. Variable lease payments associated with the Company’s leases are recognized when the event, activity, or circumstance in the lease agreement on which those payments are assessed occurs. Variable lease payments are presented in the Company’s consolidated statements of operations in the same line item as expense arising from fixed lease payments for operating leases. Leases with an initial term of 12 months or less are not recorded on the consolidated balance sheet and the Company recognizes lease expense for these leases on a straight-line basis over the lease term. The Company applies this policy to all underlying asset categories. Topic 842 requires a lessee to discount its unpaid lease payments using the interest rate implicit in the lease or, if that rate cannot be readily determined, its incremental borrowing rate. As the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The lease term for all of the Company’s leases includes the non-cancellable period of the lease plus any additional periods covered by either a Company option to extend (or not to terminate) the lease that the Company is reasonably certain to exercise, or an option to extend (or not to terminate) the lease controlled by the lessor. See Note 15 Commitments and Contingencies for additional information. Fair Value of Financial Instruments Certain assets and liabilities are carried at fair value under U.S. GAAP. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. Financial assets and liabilities carried at fair value are to be classified and disclosed in one of the following three levels of the fair value hierarchy: Level 1 — Quoted prices in active markets for identical assets or liabilities. Level 2 — Observable inputs (other than Level 1 quoted prices), such as quoted prices in active markets for similar assets or liabilities, quoted prices in markets that are not active for identical or similar assets or liabilities, or other inputs that are observable or can be corroborated by observable market. Level 3 — Unobservable inputs which are supported by little or no market activity and that are significant to determining the fair value of the assets or liabilities, including pricing models, discounted cash flow methodologies and similar techniques. Financial instruments recognized at historical amounts in the consolidated balance sheets consist of cash, accounts receivable, other current assets, accounts payable, accrued expenses, and other current liabilities. The Company believes that the carrying values of cash, accounts receivable, other current assets, accounts payable, accrued expenses, and other current liabilities approximate their fair values due to the short-term nature of these instruments. In connection with the Mergers in December 2020, each security holder of Metuchen received an earnout consideration classified as a derivative liability to be paid in the form of Petros Common Stock. The Company estimated their fair value using a Monte Carlo Simulation approach. This fair value measurement is based on significant inputs not observable in the market and thus represents a Level 3 measurement within the fair value hierarchy. The fair value of the derivative liability as of December 31, 2021 and December 31, 2020 was $0.5 million and $9.9 million, respectively. See Note 10 Stockholders’ Equity. Deferred Financing Costs Costs incurred to issue debt are deferred and presented in the consolidated balance sheets as a direct reduction from the carrying amount of the debt liability, consistent with debt discounts. Related amortization expense is recorded as a component of interest expense over the term of the related debt using the effective interest rate method. Stock-Based Compensation The Company accounts for stock-based awards to employees and consultants in accordance with applicable accounting principles, which requires compensation expense related to stock-based transactions, including employee stock options and consultant warrants, to be measured and recognized in the financial statements based on a determination of the fair value of the stock options or warrants. The grant date fair value is determined using the Black-Scholes-Merton (“Black-Scholes”) pricing model. Employee stock option and consulting expenses are recognized over the employee’s or consultant’s requisite service period (generally the vesting period of the equity grant). The Company’s option pricing model requires the input of highly subjective assumptions, including the volatility and expected term. Any changes in these highly subjective assumptions can significantly impact stock-based compensation expense. See Note 11 Stock Options. Costs of Equity Transactions Incremental direct costs incurred to issue stocks of the Company’s preferred and common stocks are recorded as a reduction of the related proceeds. Income Taxes The Company is a C corporation, which accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, the Company determines deferred tax assets and liabilities on the basis of the differences between the financial statement and tax bases of assets and liabilities by using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. The Company recognizes deferred tax assets to the extent that it believes that these assets are more likely than not to be realized. In making such a determination, the Company considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, and results of recent operations. If the Company determines that it would be able to realize deferred tax assets in the future in excess of its net recorded amount, the Company would make an adjustment to the deferred tax asset valuation allowance, which would reduce the provision for income taxes. The Company records uncertain tax positions in accordance with ASC 740 on the basis of a two step process in which (1) it determines whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, the Company recognizes the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority. The Company recognizes interest and penalties related to unrecognized tax benefits on the income tax expense line in the accompanying consolidated statement of operations. As of December 31, 2021, no accrued interest or penalties are recorded in the consolidated balance sheet. Contingencies The Company may be subject to various patent challenges, product liability claims, government investigations and other legal proceedings in the ordinary course of business. Legal fees and other expenses related to litigation are expensed as incurred and included in general and administrative expenses in the consolidated statements of operations. Shipping Costs The Company records the costs of shipping related to prescription medication sales in general and administrative expense in its consolidated statements of operations. There were no shipping costs for the years ended December 31, 2021 and 2020. Shipping costs related to medical devices are recorded as revenue and subsequently deducted as a component of cost of goods sold in the consolidated statements of operations. Shipping costs for the years ended December 31, 2021 and 2020 were $134,730 and $108,870, respectively. Basic and Diluted Net Loss per Common Share The Company computes basic net loss per common share by dividing net loss applicable to common stockholders by the weighted average number of shares of common stocks outstanding during the period, excluding the anti-dilutive effects of stock options and warrants to purchase common stocks. The Company computes diluted net loss per common stock by dividing the net loss applicable to common stocks by the sum of the weighted-average number of common stocks outstanding during the period plus the potential dilutive effects of its convertible preferred stocks, stock options and warrants to purchase common stocks, but such items are excluded if their effect is anti-dilutive. Because the impact of these items is anti-dilutive during periods of net loss, there was no difference between the Company’s basic and diluted net loss per stock of common stock for the years ended December 31, 2021 and 2020. See Note 13 Basic and Diluted Net Loss per Common Share. Recent Accounting Pronouncements Pending Adoption as of December 31, 2021 In June 2016, the FASB issued ASU No. 2016-13, Measurement of Credit Losses on Financial Instruments |
Accounts Receivable, net
Accounts Receivable, net | 12 Months Ended |
Dec. 31, 2021 | |
Accounts Receivable, net | |
Accounts Receivable, net | 3) Accounts Receivable, net Accounts receivable, net is comprised of the following: December 31, December 31, 2021 2020 Gross accounts receivables $ 3,363,827 $ 6,560,291 Distribution service fees (371,310) (972,652) Chargebacks accruals — (121,269) Cash discount allowances (159,446) (84,601) Allowance for doubtful accounts (377,685) (228,800) Total accounts receivable, net $ 2,455,386 $ 5,152,969 For the year ended December 31, 2021, gross sales from customers representing 10% or more of the Company’s total gross sales included five customers which represented approximately 27%, 22%, 16%, 13% and 11% of total gross sales. For the year ended December 31, 2020, gross sales from customers representing 10% or more of the Company’s total gross sales included one customer which represented approximately 85% of total gross sales. Receivables from customers representing 10% or more of the Company’s gross accounts receivable included three customers at December 31, 2021 equal to 40%, 19% and 15%, respectively, of the Company’s total gross accounts receivables. Receivables from customers representing 10% or more of the Company’s gross accounts receivable included one customer at December 31, 2020 equal to 93% of the Company’s total gross accounts receivables. |
Inventories
Inventories | 12 Months Ended |
Dec. 31, 2021 | |
Inventories | |
Inventories | 4) Inventories Inventory is comprised of the following: December 31, 2021 December 31, 2020 Raw materials $ 359,741 $ 325,932 Finished goods 159,908 434,598 Total inventory $ 519,649 $ 760,530 Finished goods are net of valuation reserves of $383,298 and $935,866 as of December 31, 2021 and 2020, respectively. Raw materials are net of valuation reserves of $2,872,977 as of December 31, 2021 and 2020, which is related to bulk inventory that is fully reserved. |
Prepaid Expenses and Other Curr
Prepaid Expenses and Other Current Assets | 12 Months Ended |
Dec. 31, 2021 | |
Prepaid Expenses and Other Current Assets. | |
Prepaid Expenses and Other Current Assets | 5) Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets are comprised of the following: December 31, 2021 December 31, 2020 Prepaid samples $ — $ 58,483 Prepaid insurance 73,223 149,452 Prepaid FDA fees 831,179 756,972 Prepaid coupon fees 71,500 71,500 API purchase commitment asset (see Note 14) 1,419,538 1,304,541 Due from wholesalers 609,059 — Other prepaid expenses 605,422 391,552 Other current assets 110,167 114,784 Total prepaid expenses and other current assets $ 3,720,088 $ 2,847,284 Prepaid samples, which are presented net of reserves, are expensed when distributed to the sales force. The prepaid samples reserve amount was $0 and $351,224 at December, 31, 2021 and December 31, 2020, respectively. |
Intangible Assets
Intangible Assets | 12 Months Ended |
Dec. 31, 2021 | |
Intangible Assets | |
Intangible Assets | 6) Intangible Assets Balance at December 31, 2019 $ 38,811,137 Amortization expense (6,650,218) Balance at December 31, 2020 32,160,919 Amortization expense (6,867,770) Balance at December 31, 2021 $ 25,293,149 The future annual amortization related to the Company’s intangible assets is as follows: 2022 $ 6,191,740 2023 5,445,729 2024 4,650,787 2025 2,716,011 2026 2,201,720 Thereafter 4,087,162 Total $ 25,293,149 The intangible assets held by the Company are the Stendra® product, Timm Medical product, and PTV product and are being amortized over their estimated useful lives of 10 years, 12 years, and 12 years, respectively. The carrying value of the Stendra® product, Timm Medical product, and PTV product as of December 31, 2021 are $19.1 million, $4.9 million and $1.3 million, respectively. The carrying value of the Stendra® product, Timm Medical product, and PTV product as of December 31, 2020 were $24.6 million, $5.9 million and $1.6 million, respectively. |
Accrued Expenses
Accrued Expenses | 12 Months Ended |
Dec. 31, 2021 | |
Accrued Expenses | |
Accrued Expenses | 7) Accrued Expenses Accrued expenses are comprised of the following: December 31, 2021 December 31, 2020 Accrued price protection $ 1,853,979 $ 1,853,979 Accrued product returns 6,192,845 9,452,248 Accrued contract rebates 379,242 412,046 Due to Vivus (see Note 14) 2,267,523 2,267,523 Due to third-party logistic provider 479,178 — Accrued severance — 519,609 Accrued bonuses 527,563 — Accrued professional fees 125,392 — Other accrued expenses 131,662 178,381 Total accrued expenses $ 11,957,384 $ 14,683,786 As part of its acquisition of Stendra®, the Company provides the previous owner with price protection for certain Stendra® product returns that are processed by the previous owner. Some customer agreements require that product returns be credited at the current wholesale acquisition cost (“WAC”). If the Company subsequently raises the WAC, the Company will reimburse the previous owner for the difference between the current WAC and the original sale price for returns processed by the previous owner. |
Debt
Debt | 12 Months Ended |
Dec. 31, 2021 | |
Debt | |
Debt | 8) Debt Senior Debt The Company did not have any senior indebtedness as of December 31, 2021. The following is a summary of the Company’s senior indebtedness at December 31, 2020: December 31, 2020 Principal balance $ 6,653,292 Plus: Paid-In-Kind interest — Plus: End of term fee 534,237 Less: Unamortized Debt issuance costs (12,500) Total senior debt $ 7,175,029 On September 30, 2016, the Company entered into a loan agreement with Hercules, a third party, for a $35 million term loan (“Senior Debt”) with a stated interest rate of the greater of either (i) Prime plus 7.25% or (ii) 10.75%. The Senior Debt included an additional Paid-In-Kind (“PIK”) interest that increased the outstanding principal on a monthly basis at an annual rate of 1.35% and a $787,500 end of term charge. On November 22, 2017, the Company amended its loan agreement with Hercules (“First Amendment”). A covenant was added, in which the Company must achieve a certain minimum EBITDA, as defined, target for the trailing twelve-month period, ending June 30, 2018. The end of term charge was increased from $787,500 to $1,068,750. The minimum EBITDA for each of the trailing six months and the fixed charge coverage ratio ( 1:1 0.9:1) Monthly principal payments, including interest, commenced November 1, 2018 with the outstanding balance of the Senior Debt due in full on November 1, 2020. The end of term charge was being recognized as interest expense and accreted over the term of the Senior Debt using the effective interest method. On April 13, 2020, the Company amended its loan agreement with Hercules. The amendment waived all financial covenant defaults for all periods since inception through the period ending March 31, 2020. The amendment also included the following changes: ● Removed the Adjusted EBITDA and Fixed Cost Coverage Ratio Covenants. ● Extended the maturity date from October 1, 2020 to April 2021, which was further extendable to December 1, 2021 upon achieving the Financing Milestone, as defined in the agreement. ● Increased the cash interest rate from the greater of (a) 10.75% or (b) 10.75% plus the US WSJ Prime minus 4.50% to the greater of (a) 11.50% or (b) 11.50% plus the US WSJ Prime minus 4.25% . ● Removed the PIK interest rate. ● Removed the prepayment penalty. The end of term charge of $1,068,750 was partially extended with $534,375 paid on October 1, 2020 and $534,375 due on February 1, 2021. Effective September 30, 2020, the Company and Hercules entered into the Third Amendment to Loan and Security Agreement (“Third Amendment”) to provide for interest only payments commencing on October 1, 2020 and continuing through December 22, 2020 unless the Company raised net cash proceeds of at least $25 million through an equity or debt financing or other transaction on or before December 21, 2020. The Third Amendment also amended the minimum cash, minimum net revenue and minimum EBITDA financial covenants. On that same date, Juggernaut Capital Partners III, L.P., Hercules and Wells Fargo Bank, N.A. entered into an escrow agreement (the “Escrow Agreement”) to escrow funds amounting to approximately $1.5 million, an amount equal to the aggregate of certain principal payments due under the Loan Agreement, as amended. In connection with the consummation of the Mergers, the funds held in escrow were disbursed back to Juggernaut Capital Partners III, L.P. and the Escrow Agreement was terminated. The Company satisfied the maturity date extension requirement pursuant to funds retained upon the closing of the Mergers in December 2020. As a result, the Senior Debt had a maturity date of December 1, 2021. On November 3, 2021, the Company repaid $1,179,651 towards the senior debt. This payment satisfied the remaining balance of the senior debt as of that date. Interest expense on the Senior Debt was as follows for the periods indicated: For the Years Ended December 31, 2021 2020 Interest expense for term loan $ 356,160 $ 1,241,475 Amortization of debt issuance costs 12,500 37,500 PIK interest — 44,449 $ 368,660 $ 1,323,424 Included in accrued expenses in the accompanying consolidated balance sheets as of December 31, 2020 is $65,885 of accrued and unpaid interest. Subordinated Related Party Term Loans Subordinated Related Party Term Loans Entered Into During 2020 During 2020, the Company entered into Subordinated Promissory Notes with the JCP Investor in the principal amount of $15.5 million. The maturity date of the Subordinated Promissory Notes was April 2, 2021, and they had PIK interest that increased the outstanding principal on a daily basis at an annual rate of 20%. In connection with the entry into the Merger Agreement on May 17, 2020, the note holders agreed to convert all of the above outstanding subordinated promissory notes and accrued PIK interest held by Juggernaut Capital Partners LLP and the JCP Investor, into Petros common stock. In connection with the consummation of the Mergers on December 1, 2020, and the Subordinated Promissory Notes were converted into common stock. Accordingly, the principal balance of the subordinated promissory note and accrued PIK interest was $0 as of December 31, 2021 and December 31, 2020. Interest expense on this debt was $1,727,455 comprised entirely of PIK interest, for the year ended December 31, 2020. |
Members' Capital
Members' Capital | 12 Months Ended |
Dec. 31, 2021 | |
Members' Capital | |
Members' Capital | 9) Members’ Capital On September 16, 2019, the Company amended and restated its operating agreement creating the rights and preferences relating to the Preferred Units and Common Units mentioned in the Private Placement Offering below. The issued and outstanding Preferred Units and Common Units were exchanged for Common Stock of the Company in connection with the Mergers. Preferred Units A holder of a Preferred Unit was entitled to vote on any matter requiring the approval of such units. In addition, the Preferred Unit holders were entitled to distributions, after adjustment for specific items, for each fiscal year. Common Units (formerly known as Class A Units) A holder of a Common Unit was entitled to vote on any matter requiring the approval of such units. In addition, the Common Unit holders were entitled to distributions, after adjustment for specific items, for each fiscal year. Liquidation Upon liquidation of the Company or upon any Company sale, the Company was required to pay, hold, or distribute, or cause to be paid, held or distributed, the proceeds thereof as follows: (a) first, to the holders of Preferred Units, pro rata in proportion to the number of Preferred Units held by such holders, until the holders of such Preferred Units receive in respect of each Preferred Unit held by them, the preferred liquidation preference amount; (b) second, to the holders of Common Units, pro rata in proportion to the number of Common Units held by such holders, the remaining proceeds available for distribution. |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2021 | |
Stockholders' Equity | |
Stockholders' Equity | 10) Stockholders’ Equity Upon consummation of the Mergers, each outstanding Common Unit or Preferred Unit of Metuchen was exchanged for a number of shares of Petros common stock, par value $0.0001 per share (the “Petros Common Stock”), equal to 0.4968, which resulted in an aggregate of 4,949,610 shares of Petros Common Stock issued to the holders of Metuchen units in the Mergers. In addition, each holder of Neurotrope common stock, par value $0.0001 per share (the “Neurotrope Common Stock”) received one (1) share of Petros Common Stock for every five (5) shares of Neurotrope Common Stock held, and each holder of Neurotrope preferred stock, par value $0.001 per share (the “Neurotrope Preferred Stock”) received one (1) share of Petros preferred stock (the “Petros Preferred Stock”) for every one (1) share of Neurotrope Preferred Stock held. In addition, each holder of outstanding options to purchase Neurotrope Common Stock or outstanding warrants to purchase Neurotrope Common Stock that were not previously exercised prior to the consummation of the Mergers was converted into equivalent options and warrants to purchase one (1) share of Petros Common Stock for every five (5) shares of Neurotrope Common Stock outstanding pursuant to such options or warrants. As a result of the Mergers, the former Neurotrope shareholders collectively owned approximately 4,758,045 shares of Petros Common Stock and 500 shares of Petros Preferred Stock and the former Metuchen unit holders collectively owned 4,949,610 shares of Petros Common Stock. Accordingly, the former Metuchen unit holders collectively owned approximately 51% of Petros and the former Neurotrope shareholders collectively own approximately 49% of Petros. On January 26, 2021, 500 shares of the Company’s Preferred Stock were converted into 60,606 shares of the Company’s common stock. Effective January 1, 2021, the Company entered into a Marketing and Consulting Agreement (the "CorIRAgreement") with CorProminence, LLC (the "Consultant") for certain shareholder information and relation services. The term of the CorIRAgreement is for one year with automatic consecutive one-year renewal terms. As consideration for the shareholder information and relation services, the Company will pay the Consultant a monthly retainer of $7,500 and issued 30,000 restricted shares of the Company's common stock to the Consultant on March 24, 2021 (the "CorIR Grant Date"). The restricted shares vested immediately on the CorIR Grant Date. Effective April 1, 2021, the Company entered into a Consulting and Advisory Agreement (the "King Agreement") with Tania King, an employee of Juggernaut Capital Partners LLP, for certain services. The term of the King Agreement is indefinite but may be terminated by either party, with or without cause. As consideration for the consulting and advisory services, the Company will pay Ms. King a monthly fee of $4,000, an additional $12,000 payment included with the first monthly fee for services provided since January 1, 2021, and issue restricted stock units for shares of the Company's common stock ("RSU's") with a cash value of $72,000 as of the date of the grant (the "King Grant Date"). The RSU's shall vest and settle in full on the one-year anniversary of the King Grant Date. Effective June 4, 2021, the Company entered into a Service Agreement with IRTH Communications, LLC ("ITRH") for certain investor relations services (the "IRTH Agreement"). The term of the IRTH Agreement is for one year with an optional one-year renewal term. As consideration for the services, the Company will pay IRTH a fixed fee of $6,750 per month for the term of the IRTH Agreement and issued 28,338 restricted shares of the Company's common stock with a value of $90,002 as of the date of the grant (the "IRTH Grand Date"). The restricted shares vest immediately on the IRTH Agreement Grant Date. Backstop Agreement In connection with the entry into the Merger Agreement, Neurotrope and an affiliated entity of Juggernaut Capital Partners (“Juggernaut”) entered into a Backstop Agreement pursuant to which Juggernaut agreed to contribute to Metuchen at the closing of the Mergers an amount equal to the Working Capital Shortfall Amount (as defined in the Merger Agreement), if any, as determined in accordance with the Merger Agreement, up to an aggregate amount not to exceed $6,000,000. Pursuant to the Backstop Agreement and upon closing of the Mergers, Juggernaut paid the Company $2.6 million for the Working Capital Shortfall Amount, which was recorded in equity in relation to the net proceeds received from the reverse capitalization. Contingent Consideration Pursuant to the Merger Agreement, each security holder of Metuchen received a right to receive such security holder’s pro rata stock of an aggregate of 14,232,090 shares of Petros Common Stock potentially issuable upon the achievement of certain milestones set forth in the Merger Agreement. The milestones are for the achievement of stock price and market capitalization, as defined over a two-year period. Milestone Earnout Payments In connection with the Mergers, each security holder of Metuchen received an equity classified earnout consideration to be paid in the form of Petros Common Stock if the Closing Price (as defined in the Merger Agreement) per share of stock of Petros’ Common Stock equals or exceeds certain milestones set forth in the Merger Agreement, as discussed below. Each milestone earnout payment is only achievable and payable one time and upon attainment of such milestone earnout payment. In no event will the sum of the milestone earnout payments be greater than 4,000,000 shares of Petros Common Stock. As of December 31, 2021, the milestones have not been achieved. If at any time following the Closing (as defined in the Merger Agreement) and prior to the one-year anniversary of the Closing, (December 1, 2021), the Closing Price per share of Petros Common Stock is, for a period of twenty (20) trading days during any thirty (30) consecutive trading day period, greater than or equal to certain minimums. If at any time within the twelve (12) month period following the one-year anniversary of the Closing, the Closing Price per share of Petros Common Stock is, for a period of twenty (20) trading days during any thirty (30) consecutive trading day period, greater than or equal to: ● $ 10.00 - then the earnout payment will be equal to 1,000,000 shares of Petros Common Stock. ● $ 12.50 - then the earnout payment will be equal to 1,000,000 shares of Petros Common Stock. ● $ 16.25 - then the earnout payment will be equal to 1,000,000 shares of Petros Common Stock. ● $ 18.75 - then the earnout payment will be equal to 1,000,000 shares of Petros Common Stock. Market Capitalization/Gross Proceeds Earnout Payments In connection with the Mergers, each security holder of Metuchen received the right to receive earnout consideration, which is liability classified, to be paid in the form of Petros Common Stock if either Petros’ Market Capitalization (as defined in the Merger Agreement) or Petros receives aggregate gross proceeds that equals or exceeds certain milestones set forth in the Merger Agreement, as discussed below. Each milestone earnout payment is only achievable and payable one time and upon attainment of such milestone. In no event will the sum of the milestone earnout payments be greater than 10,232,090 shares of Petros Common Stock. As of December 31, 2021, the milestones have not been achieved. The fair value of the derivative liability was $0.5 million and $9.9 million as of December 31, 2021 and December 31, 2020, respectively. Metuchen equity holders will have the opportunity to receive the following during the period ending on the second anniversary of the Closing: a. The Earnout Payment shall be equal to 2,000,000 shares of Petros Common Stock if: i. Petros’ Market Capitalization (as defined in the Merger Agreement) is greater than or equal to $250,000,000 for a period of twenty (20) trading days during any thirty (30) consecutive trading day period with a Closing Price of no less than $17.50 on each such trading day; or ii. Petros receives aggregate gross proceeds of at least $25,000,000 in an offering (or series of offerings within a sixty (60) calendar day period) of Petros Common Stock with a price per share of Petros Common Stock sold equal to no less than $17.50 in each offering (or series of offerings) and where Petros has a Market Capitalization immediately prior to each such offering (or series of offerings) equal to at least $250,000,000 . b. The Earnout Payment shall be equal to 2,000,000 shares of Petros Common Stock if: i. Petros’ Market Capitalization is greater than or equal to $300,000,000 for a period of twenty (20) trading days during any thirty (30) consecutive trading day period with a Closing Price of no less than $18.75 on each such trading day; or ii. Petros receives aggregate gross proceeds of at least $30,000,000 in an offering (or series of offerings within a sixty (60) calendar day period) of Petros Common Stock with a price per share of Petros Common Stock sold equal to no less than $18.75 in each offering (or series of offerings) and where Petros has a Market Capitalization immediately prior to each such offering (or series of offerings) equal to at least $300,000,000 . c. The Earnout Payment shall be equal to 3,000,000 shares of Petros Common Stock if: i. Petros’ Market Capitalization is greater than or equal to $400,000,000 for a period of twenty (20) trading days during any thirty (30) consecutive trading day period with a Closing Price of no less than $22.50 on each such trading day; or ii. Petros receives aggregate gross proceeds of at least $40,000,000 in an offering (or series of offerings within a sixty (60) calendar day period) of Petros Common Stock with a price per share of Petros Common Stock sold equal to no less than $22.50 in each offering (or series of offerings) and where Petros has a Market Capitalization immediately prior to each such offering (or series of offerings) equal to at least $400,000,000 . d. The Earnout Payment shall be equal to 3,232,090 shares of Petros Common Stock if: i. Petros’ Market Capitalization is greater than or equal to $500,000,000 for a period of twenty (20) trading days during any thirty (30) consecutive trading day period with a Closing Price of no less than $23.75 on each such trading day; or ii. Petros receives aggregate gross proceeds of at least $50,000,000 in an offering (or series of offerings within a sixty (60) calendar day period) of Petros Common Stock with a price per share of Petros Common Stock sold equal to no less than $23.75 in each offering (or series of offerings) and where Petros has a Market Capitalization immediately prior to each such offering (or series of offerings) equal to at least $500,000,000 . |
Stock Options and Restricted St
Stock Options and Restricted Stock Units (''RSU's'') | 12 Months Ended |
Dec. 31, 2021 | |
Stock Options and Restricted Stock Units ("RSU's") | |
Stock Options and Restricted Stock Units ("RSU's") | 11) Stock Options and Restricted Stock Units (“RSU’s”) The Company established the 2020 Omnibus Incentive Compensation plan (the “2020 Plan”) which provides for the grants of awards to our directors, officers, employees, and consultants. The 2020 Plan authorizes the grant of incentive stock options, nonqualified stock options, stock appreciation rights, stock awards, stock units and other stock-based awards and cash-based awards. On December 22, 2021, our stockholders approved the Second Amendment to the 2020 Plan to increase the total number of shares of common stock issuable under the 2020 Plan by 1,521,654 shares to a total of 2,600,000 shares of common stock. As of December 31, 2021, there were 2,600,000 shares authorized and 1,867,948 shares available for issuance under the 2020 Plan. Upon the consummation of the Mergers as disclosed in Note 1, Neurotrope options issued and outstanding as of December 1, 2020 were converted into equivalent options to purchase stocks of Petros common stock and were adjusted to give effect to the Exchange Ratio set forth in the Merger Agreement. The following is a summary of stock options for the period from December 1, 2020 through December 31, 2020 and for the year ended December 31, 2021: Weighted-Average Aggregate Instrinsic Weighted-Average Remaining Contractual Value Number of Shares Exercise Price Term (Years) ($ in thousands) Options outstanding at December 1, 2020 574,331 $ 51.43 0.9 $ — Options granted — — — — Less: options forfeited — — — — Less: options expired/cancelled — — — — Less: options exercised — — — — Options outstanding at December 31, 2020 574,331 $ 51.43 0.9 $ — Options granted 615,669 3.38 9.23 — Less: options forfeited — — — — Less: options expired/cancelled (574,331) 51.43 — — Less: options exercised — — — — Options outstanding at December 31, 2021 615,669 $ 3.38 9.23 $ — Options exercisable at December 31, 2021 277,835 $ 3.40 9.23 $ — The Company did not issue any RSU’s during the period from December 1, 2020 through December 31, 2020. The following is a summary of RSU’s for the year ended December 31, 2021: Weighted-Average Aggregate Intrinsic Weighted-Average Remaining Contractual Value Number of Shares Exercise Price Term (Years) ($in thousands) RSU’s outstanding at December 31, 2020 — $ — — $ — RSU’s granted 116,383 3.29 9.84 — Less: RSU’s forfeited — — — — Less: RSU’s expired/cancelled — — — — Less: RSU’s exercised — — — — RSU’s outstanding at December 31, 2021 116,383 $ 3.29 9.84 $ — RSU’s exercisable at December 31, 2021 — $ — — $ — Upon the consummation of the Mergers as disclosed in Note 1, the vesting of former Neurotrope stock options in accordance with their terms was accelerated due to a change in control pursuant to the terms of the Neurotrope, Inc. 2013 Equity Incentive Plan and the Neurotrope, Inc. 2017 Equity Incentive Plan. Pursuant to the change in control, Neurotrope extended the period to exercise the stock options to be one-year from the closing of the Mergers. Accordingly, the Company did not record any stock-based compensation expense in connection with these stock options. On February 19, 2021, Fady Boctor, the President and Chief Commercial Officer of the Company, was granted an option to purchase 215,669 shares of the Company’s common stock at an exercise price of $3.74 per share. The option vested 50% as of February 19, 2021, the date of grant, and the remainder shall vest in equal installments on the first and second anniversary thereof. On April 8, 2021, in connection with the Directors' appointment to the Board upon the Company becoming an independent publicly traded company on December 1, 2020, the Company awarded each of the five Directors an initial grant of options (the "Initial Grant") to purchase 50,000 shares of common stock of the Company at an exercise price of $3.18 per share. The shares of common stock underlying the options vested 25% on the date of grant, 25% shall vest upon the six-month anniversary of the date of grant and the remainder shall vest in equal installments over the following four On May 11, 2021, the Company granted to certain officers of the Company options to purchase 150,000 shares of common stock of the Company at an exercise price or $3.21 per share. The shares of common stock underlying the options vested 30% on the date of grant, 30% shall vest upon the one year anniversary of the date of the grant, and the remainder shall vest upon the two year anniversary of the date of the grant. Stock-based compensation expense recognized for the year ended December 31, 2021 was $1,305,150 and is recorded in general and administrative expenses in the consolidated statements of operations. The Company did not incur any stock-based compensation expense for the period from December 1, 2020 through December 31, 2020. |
Common Stock Warrants
Common Stock Warrants | 12 Months Ended |
Dec. 31, 2021 | |
Common Stock Warrants | |
Common Stock Warrants | 12) Common Stock Warrants Upon the consummation of the Merger as disclosed in Note 1, Neurotrope warrants issued and outstanding as of December 1, 2020 were converted into equivalent warrants to purchase common stock of Petros and were adjusted to give effect to the Exchange Ratio set forth in the Merger Agreement. The following is a summary of warrants for the year ended December 31, 2021: Number of Shares Warrants outstanding at December 1, 2020 4,407,962 Warrants issued — Warrants exercised — Warrants expired — Warrants outstanding at December 31, 2020 4,407,962 Warrants issued 7,853,558 Warrants exercised (2,014,586) Warrants expired (207,913) Warrants outstanding at December 31, 2021 10,039,021 As of December 31, 2021, the Company’s warrants by expiration date were as follows: Number of Warrants Exercise Price Expiration Date 2,780 1.60 August 23, 2023 22,800 35.65 June 1, 2024 74,864 21.85 June 17, 2024 20,043 31.25 June 19, 2024 22,800 26.55 September 1, 2024 10,500 12.738 September 16, 2024 22,800 4.30 December 1, 2024 28,000 5.65 March 2, 2025 28,000 7.30 June 1, 2025 28,000 5.50 September 1, 2025 28,000 4.705 December 1, 2025 2,221,829 7.50 December 1, 2025 908,498 17.50 December 1, 2025 623,303 51.25 December 1, 2025 157,832 125.00 December 1, 2025 1,751,311 1.715 October 18, 2026 2,337,719 3.50 December 12, 2026 1,749,942 3.50 December 27, 2026 10,039,021 |
Basic and Diluted Net Loss per
Basic and Diluted Net Loss per Common Share | 12 Months Ended |
Dec. 31, 2021 | |
Basic and Diluted Net Loss per Common Share | |
Basic and Diluted Net Loss per Common Share | 13) Basic and Diluted Net Loss per Common Share Upon the consummation of the Mergers on December 1, 2020, the basic weighted average number of common shares outstanding for the year ended December 31, 2020 has been calculated using the number of common units outstanding of Metuchen from January 1, 2020 through the December 1, 2020 acquisition date multiplied by the exchange ratio used in the transaction and the number of common shares outstanding of the Company from December 1, 2020 through December 31, 2020. The following is a reconciliation of the weighted average number of common shares outstanding used in calculating basic and diluted net loss per share: For the Years Ended December 31, 2021 2020 Numerator Net (loss) income $ (8,986,676) $ (20,585,925) Denominator Weighted-average common shares for basic and diluted net loss per unit 10,889,766 5,340,682 Basic and diluted net loss per common share $ (0.83) $ (3.85) The following table summarizes the potentially dilutive securities convertible into common shares that were excluded from the calculation of diluted net loss per share because their inclusion would have been antidilutive: For the Years Ended December 31, 2021 2020 Stock options 615,669 574,331 RSUs 116,383 — Warrants 10,039,021 4,407,962 Total 10,771,073 4,982,293 |
Marketing, Licensing and Distri
Marketing, Licensing and Distribution Agreements | 12 Months Ended |
Dec. 31, 2021 | |
Marketing, Licensing and Distribution Agreements. | |
Marketing, Licensing and Distribution Agreements | 14) Marketing, Licensing and Distribution Agreements (a) Vivus On September 30, 2016, the Company entered into a License and Commercialization Agreement (the “License Agreement”) with Vivus, Inc (“Vivus”) to purchase and receive the license for the commercialization and exploitation of Stendra® for a one-time fee of $70 million. The License Agreement gives the Company the right to sell Stendra® in the U.S and its territories, Canada, South America, and India. In December 2000, Vivus originally was granted the license from Mitsubishi Tanabe Pharma Corporation (“MTPC”) to develop, market, and manufacture Stendra®. Stendra® was approved by the Food and Drug Administration (“FDA”) in April 2012 to treat male erectile dysfunction. Under the License Agreement, the Company will pay MTPC a royalty of 5% on the first $500 million of net sales and 6% of net sales thereafter. In consideration for the trademark assignment and the use of the trademarks associated with the product and the Vivus technology, the Company shall (a) during the first, second, and third years following the expiration of the Royalty Period in a particular country in the Company’s territory, pay to Vivus a royalty equal to 2% of the net sales of products in such territory; and (b) following the fourth and fifth years following the end of the Royalty Period in such territory, pay to Vivus a royalty equal to 1% of the net sales of products in such territory. Thereafter, no further royalties shall be owed with respect to net sales of Stendra® in such territory. In addition, the Company will be responsible for a pro-rata portion of a $6 million milestone payment to be paid once $250 million in sales has been reached on the separate revenue stream of Stendra®. Should the $250 million of sales threshold be reached, the Company will be responsible for $3.2 million of the milestone payment. In connection with the License Agreement, the Company and Vivus also entered into a Supply Agreement on the effective date of the License Agreement, which has since been terminated, effective September 30, 2021. On January 18, 2022, Petros (through its wholly-owned subsidiary) and Vivus entered into a Settlement Agreement (the “Vivus Settlement Agreement”) related to the minimum purchase requirements under the Vivus Supply Agreement in 2018, 2019 and 2020 and certain reimbursement rights asserted by a third-party retailer in connection with quantities of the Company’s Stendra® product that were delivered to the third-party retailer and later returned. In connection with the Vivus Settlement Agreement, Petros retained approximately $7.3 million of API inventory (representing the 2018 and 2019 minimum purchase requirements) out of approximately $12.4 million due under the Vivus Supply Agreement, in conjunction with forgiveness of approximately $4.25 million of current liabilities relating to returned goods and minimum purchase commitments. In exchange for the API and reduction of current liabilities, Petros executed an interest-bearing promissory note (the “Note”) in favor of Vivus in the principal amount of $10,201,758. The parties also entered into a Security Agreement to secure Petros’ obligations under the Note. The Company will record the impact of this transaction, including the expected gain in the first quarter of 2022. In addition to the payments to be made in accordance with the Note, the Company further agreed in the Vivus Settlement Agreement to (i) grant to Vivus a right of first refusal to provide certain types of debt and convertible equity (but not preferred equity) financing issued by or to Metuchen (including any subsidiaries and intermediaries) until the Note is paid in full, and (ii) undertake to make certain regulatory submissions to effectuate Vivus’ ability to exercise its rights under the License Agreement. On January 18, 2022, the Company made a prepayment of the obligations under the Note in the amount of $900,000, and a payment of $1,542,904 with respect to a purchase order made in 2021 to Vivus. In consideration of these payment and upon the Company’s satisfaction of certain regulatory submissions Vivus released 50% of the quantity of bulk Stendra® tablets on January 18, 2022 under the Company’s existing open purchase order (the “Open Purchase Order”) being held by Vivus, which represents approximately a six month supply of inventory. Under the Vivus Settlement Agreement Vivus also agreed to release the remaining 50% of the quantity of bulk Stendra® tablets under the Open Purchase Order upon the Company’s satisfaction of the remaining regulatory submission requirements (not to exceed 180 days Under the terms of the Note, the principal amount of $10,201,758 is payable in consecutive quarterly installments beginning on April 1, 2022 through January 1, 2027. Interest on the principal amount will accrue at a rate of 6% per year until the principal is repaid in full and is due and payable, in arrears, on the first day of each January, April, July, and October of each calendar year, commencing on April 1, 2022. The Company may prepay the Note, in whole or in part, at any time, with no premium or penalty. In the event that the Company defaults under the Security Agreement, all principal outstanding under the Note at the time of the default will bear interest at a rate of 9% per year until the full and final payment of all principal and interest under the Note (regardless of whether any default is waived or cured). If the Note is placed in the hands of any attorney for collection, or if it is collected through any legal proceeding at law or in equity or in bankruptcy, receivership, or other court proceedings, the Company will also be required to pay all costs of collection including, but not limited to, court costs and attorneys’ fees. Pursuant to the Security Agreement, dated January 18, 2022, the Company granted to Vivus a continuing security interest in all of its Stendra® API and products and its rights under the License Agreement. The Security Agreement contains customary events of default. As of December 31, 2021 and 2020, the Company has $14.2 During the years ended December 31, 2021 and 2020, the Company incurred royalties to MTPC for Stendra(R) of $221,211 and $317,875, respectively. Royalties incurred were included in cost of goods sold in the consolidated statements of operations. As of December 31, 2021, the Company had a receivable for royalties of $81,136, which is included in other current assets in prepaid expenses and other current assets (see Note 5 Prepaid and Other Current Assets). As of December 31, 2020, the Company had a payable for royalties of $8,728, which is included in accrued expenses in the accompanying consolidated balance sheets. The license agreement between MTPC and Vivus (“MTPC License”) contains certain termination rights that would allow MTPC to terminate the agreement if Vivus were to breach any of the terms of the MTPC License or become insolvent or bankrupt. In the event that MTPC terminates the MTPC License with Vivus because of any contractual breach the Company has step-in rights with MTPC, which would allow the Company to continue to sell Stendra®. (b) Patheon Following the termination of the Vivus Supply Agreement, Petros, through its subsidiary Metuchen, entered into a Technology Transfer Service Agreement on January 20, 2022 with Patheon Pharmaceuticals Inc., part of Thermo Fisher Scientific (“Patheon”), pursuant to which the Company and Patheon agreed to collaborate as strategic partners for commercial production of Stendra® tablets at Patheon’s facilities in Cincinnati, Ohio. Under the Agreement, Patheon or one of its affiliates will provide pharmaceutical development and technology transfer services in order to establish and validate its ability to manufacture supply of the Company’s Stendra® product. Any commercial sale of product manufactured during the performance of the Agreement must be subject to a subsequent commercial manufacturing services agreement (with associated quality agreement) between the parties before it can be offered for commercial sale. (c) Hybrid In March 2020, the Company acquired the exclusive license to H100™ from Hybrid. H100™ is a topical candidate with at least one active ingredient and potentially a combination of ingredients responsible for the improvement of penile curvature during the acute phase of Peyronie’s disease. We paid an initial license fee of $100,000, with an additional $900,000 payment due upon obtainment of orphan indication for H100™ and termination of Hybrid’s existing agreement with a compounding pharmacy, and additional annual payments of $125,000, $150,000 and $200,000 due on each of the first, second and third anniversaries of the license agreement and $250,000 annual payments due thereafter. The Company is also required to make a $1,000,000 payment upon first commercial sale and a sliding scale of percentage payments on net sales in the low single digits. Annual anniversary payments will not be required after commercialization. The Company is also obligated to make royalty payments between 3-6% of any net sales. In addition, the Company may terminate at any time after first anniversary, without cause, upon ninety (90) days’ notice. The initial license fee of $100,000 and an extension payment of $100,000 has been recorded in research and development during the year ended December 31, 2020. The Company has treated the acquisition as an asset acquisition and has concluded that the asset acquired and the upfront payment should be expensed as it was considered an IPR&D asset with no alternative future uses. On September 24, 2020, the Company and Hybrid entered into a letter agreement, pursuant to which the term of the license agreement was extended for an additional six months to March 24, 2021. In consideration for the extension, the Company paid Hybrid $50,000 in October 2020 and an additional $100,000 in December 2020. On March 31, 2021, the Company and Hybrid, entered into a second letter agreement, pursuant to which the parties agreed to extend the Second Period (as defined in the Hybrid License) for an additional six (6) months to September 24, 2021. Additionally, the Company agreed to pay Hybrid a one-time, non-creditable and non-refundable payment of $200,000, which was paid within seven |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2021 | |
Commitments and Contingencies | |
Commitments and Contingencies | 15) Commitments and Contingencies (a) Employment Agreements The Company has employment agreements with certain executive officers and key employees that provide for, among other things, salary and performance bonuses. In connection with entry into the Merger Agreement Amendment, Neurotrope, Neurotrope Bioscience, Inc. (a wholly-owned subsidiary of Neurotrope) and Metuchen entered into an Employee Lease Agreement pursuant to which Neurotrope and Neurotrope Bioscience, Inc. agreed to lease the services of Dr. Charles Ryan to Metuchen prior to the Closing. Dr. Ryan was required to devote no more than 75% of his working time performing services to Metuchen under the Employee Lease Agreement and Metuchen paid 75% of the costs associated with Dr. Ryan’s employment from the period beginning on June 1, 2020 through the Closing, including but not limited to, the costs for all compensation and benefits paid to, for or on behalf Dr. Ryan (the “Fees”). Upon consummation of the Mergers, Metuchen paid approximately $0.2 million for the Fees pursuant to the Employee Lease Agreement, which reduced the amount of cash that Petros retained following the Closing. In connection with the consummation of the Mergers, on December 24, 2020, the Company and Mr. Keith Lavan entered into a Separation Agreement (the “Separation Agreement”), pursuant to which Mr. Lavan resigned as Senior Vice President and Chief Financial Officer of the Company and agreed to serve as an advisor to the Company through December 31, 2020 (the “Separation Date”). Pursuant to the Separation Agreement, in addition to other benefits, Mr. Lavan received a stay-on bonus of $50,000 for continuing to remain employed by the Company through the Separation Date. For his services as an advisor, the Company agreed to pay Mr. Lavan an amount equal to 50% of his base salary as of immediately prior to the Separation Date. The Company paid 70% of such amount on January 15, 2021 and 30% of such amount in equal installments from the Separation Date through June 30, 2021. In addition, Mr. Lavan executed a general release of liabilities in favor of the Company. (b) Legal Proceedings On July 14, 2020, Greg Ford, the Chief Executive Officer of the Company, was terminated. On July 14, 2020, Mr. Ford, through his attorney, claimed that he was entitled to severance pay pursuant to an employment agreement following the termination of his employment on that same date. This claim is currently at an early stage where the Company is unable to determine the likelihood of any unfavorable outcome. The Company is not currently involved in any other significant claims or legal actions that, in the opinion of management, will have a material adverse impact on the Company’s operations, financial position or cash flows. (c) Operating Leases The Company has commitments under operating leases for office and warehouse space used in its operations. The Company’s leases have remaining lease terms ranging from 2.7 years to 5.0 years. The components of lease expense were as follows: For the Years Ended December 31, 2021 2020 Operating Lease Cost: Fixed lease cost $ 179,246 $ 179,246 Supplemental balance sheet information related to leases was as follows: As of December 31, 2021 As of December 31, 2020 Operating lease ROU asset: Other assets $ 475,557 $ 579,535 Operating lease liability: Other current liabilities $ 125,579 $ 108,971 Other long-term liabilities 405,018 530,597 Total operating lease liability $ 530,597 $ 639,568 Supplemental lease term and discount rate information related to leases was as follows: As of December 31, 2021 As of December 31, 2020 Weighted-average remaining lease terms - operating leases 3.69 years 4.7 years Weighted-average discount rate - operating leases 12.6 % 12.6 % Supplemental cash flow information related to leases was as follows: For the Years Ended December 31, 2021 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 184,239 $ 182,639 Future minimum lease payments under non-cancelable leases as of December 31, 2021 were as follows: Lease Liability Maturity Analysis Operating Leases 2022 $ 187,739 2023 189,374 2024 155,242 2025 81,107 2026 82,324 Thereafter — Total lease payments 695,787 Less: Imputed Interest (165,190) Total $ 530,597 On November 30, 2021, the Company entered into a sublease with respect to its entire headquarters facility. The sublessor delivered a $14,000 security deposit to the Company on the lease commencement date and also agreed to pay $7,000 per month for the term beginning January 10, 2022 and continuing until the expiration of the head lease on August 30, 2024. The Company will account for this sublease as an operating lease in accordance with the lessor accounting guidance within ASC 842. As of December 31, 2021, the Company had no operating leases that had not yet commenced. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2021 | |
Income Taxes | |
Income Taxes | 16) Income Taxes The current and deferred income tax expense (benefit) for the years ended December 31, 2021 and 2020 is as follows: For the Years Ended December 31, 2021 2020 Current expense (benefit): Federal $ — $ 5,085 State — 88 Total current expense (benefit) — 5,173 Deferred expense (benefit): Federal — (1,378,731) State — (53,435) Total deferred expense (benefit) — (1,432,166) Total income tax expense (benefit) $ — $ (1,426,993) A reconciliation of the Company’s statutory income tax rate to the Company’s effective income tax rate is as follows: For the Years Ended December 31, 2021 2020 Income at US statutory rate 21.00 % 21.00 % State taxes, net of federal benefit (0.61) % 1.56 % Permanent differences 22.31 % (2.68) % Recapitalization 0.00 % 36.49 % Pass through income to members 0.00 % (32.71) % Book income return to provision 7.43 % 0.00 % Valuation allowance (55.55) % (17.22) % Adjustment to opening deferrals - short period 5.42 % 0.00 % Effective income tax rate 0.00 % 6.44 % Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company’s deferred tax assets and liabilities as of December 31, 2021 and December 31, 2020 are as follows: For the Years Ended December 31, 2021 2020 Accruals $ 186,739 $ 90,222 Intangible assets (1,006,954) (1,238,128) Depreciation and amortization 5,669,065 5,661,235 Expenses not currently deductible 815,108 148,708 Net operating loss carryforwards 3,702,789 57,266 Interest expense limitation 96,920 25,547 Stock-based compensation 2,716,370 2,505,425 Valuation allowance (12,180,037) (7,250,275) Total deferred tax liability $ — $ — The Company assesses the need for a valuation allowance related to its deferred income tax assets by considering whether it is more likely than not that some portion or all of the deferred income tax assets will not be realized. A valuation allowance has been recorded against the Company’s deferred income tax assets, as it is in the opinion of management that it is more likely than not that the net operating loss carryforwards (“NOL”) will not be utilized in the foreseeable future. The cumulative valuation allowance as of December 31, 2021 is $12.2 As of December 31, 2021, the Company’s estimated aggregate total NOLs were $17.4 million for U.S. federal purposes with an indefinite life due to regulations set forth in the Tax Cuts and Jobs Act of 2017. The future utilization of the NOLs are limited to 80% of taxable income. The aggregate total NOLs are presented before Internal Revenue Code, Section 382 limitations ("Section 382"). The Tax Reform Act of 1986 imposed substantial restrictions on the utilization of NOL and tax credits in the event of an ownership change of a corporation. Thus, the Company's ability to utilize all such NOL and credit carryforwards may be limited. The Company files its tax returns in the U.S. federal jurisdiction, as well as in various state and local jurisdictions. The Company is not currently under audit in any taxing jurisdictions. The federal statute of limitations for audit consideration is 3 years from the filing date, and generally states implement a statute of limitations between 3 The calculation of the Company’s tax liabilities involves dealing with uncertainties in the application of complex tax laws and regulations for both federal taxes and the many states in which we operate or do business in. ASC 740 states that a tax benefit from an uncertain tax position may be recognized when it is more likely than not that the position will be sustained upon examination, including resolutions of any related appeals or litigation processes, on the basis of the technical merits. The Company records uncertain tax positions as liabilities in accordance with ASC 740 and adjust these liabilities when our judgment changes as a result of the evaluation of new information not previously available. Because of the complexity of some of these uncertainties, the ultimate resolution may result in a payment that is materially different from our current estimate of the unrecognized tax benefit liabilities. These differences will be reflected as increases or decreases to income tax expense in the period in which new information is available. As of December 31, 2021, the Company has not recorded any uncertain tax positions in its consolidated financial statements. The Company recognizes interest and penalties related to unrecognized tax benefits on the income tax expense line in the accompanying consolidated statement of operations. As of December 31, 2021, no accrued interest or penalties are included on the related tax liability line in the consolidated balance sheet. |
Defined Contribution Plan
Defined Contribution Plan | 12 Months Ended |
Dec. 31, 2021 | |
Defined Contribution Plan | |
Defined Contribution Plan | 17) Defined Contribution Plan The Company has a qualified defined contribution plan under Section 401(k) of the Internal Revenue Code covering eligible employees. Eligible employees can contribute to the defined contribution plan, subject to certain limitations, on a pre-tax basis. The Company matches up to 100% of the first 6% of each employee’s contribution and is recognized as expense in general and administrative expenses on the consolidated statement of operations. Employer contributions were $57,543 and $116,364 for the year ended December 31, 2021 and 2020, respectively. |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2021 | |
Segment Information | |
Segment Information | 18) Segment Information The Company manages its operations through two segments. The Company’s two segments, Prescription Medications and Medical Devices, focus on the treatment of male erectile dysfunction. The Prescription Medications segment consists primarily of operations related to Stendra®, which is sold generally in the United States, and H100™ for the treatment of Peyronie’s disease. The Medical Devices segment consists primarily of operations related to vacuum erection devices, which are sold domestically and internationally. The Company separately presents the costs associated with certain corporate functions as Corporate, primarily consisting of unallocated operating expenses including costs that were not specific to a particular segment but are general to the group, expenses incurred for administrative and accounting staff, general liability and other insurance, professional fees and other similar corporate expenses. Interest and other income (expense), net is also not allocated to the operating segments. The Company’s results of operations by reportable segment for the year ended December 31, 2021 are summarized as follows: Prescription Medical For the year ended December 31, 2021 Medications Devices Corporate Consolidated Net sales $ 4,605,043 $ 3,206,221 $ — $ 7,811,264 Cost of goods sold 577,795 1,021,771 — 1,599,566 Selling, general and administrative expenses 6,473,482 2,620,403 6,499,348 15,593,233 Research and development expenses 1,788,491 — — 1,788,491 Depreciation and amortization expense 5,564,499 1,313,491 — 6,877,990 Change in fair value of derivative liability — — (9,430,000) (9,430,000) Interest expense — — 368,660 368,660 Net loss $ (9,799,224) $ (1,749,444) $ 2,561,992 $ (8,986,676) The Company’s results of operations by reportable segment for the year ended December 31, 2020 are summarized as follows: Prescription Medical For the year ended December 31, 2020 Medications Devices Corporate Consolidated Net sales $ 6,357,498 $ 3,201,971 $ — $ 9,559,469 Cost of goods sold 3,083,417 963,049 — 4,046,466 Selling, general and administrative expenses 8,784,716 2,024,448 4,865,804 15,674,968 Research and development expense 459,636 — — 459,636 Depreciation and amortization expense 5,424,292 1,236,146 — 6,660,438 Change in fair value of derivative liability — — 1,680,000 1,680,000 Interest expense — — 3,050,879 3,050,879 Income tax benefit — 1,426,993 — 1,426,993 Net loss $ (11,394,563) $ (405,321) $ (9,596,683) $ (20,585,925) The following table reflects net sales by geographic region for the years ended December 31, 2021 and 2020: For the Years Ended December 31, Net sales 2021 2020 United States $ 6,572,849 $ 8,555,831 International 1,238,415 1,003,638 $ 7,811,264 $ 9,559,469 No individual country other than the United States accounted for 10% of total sales for the year ended December 31, 2021 and 2020. The Company’s assets by reportable segment and reconciliation of segment assets to consolidated assets as of December 31, 2021 are summarized as follows: Prescription Medications Medical Devices Consolidated Intangible assets, net $ 19,071,407 $ 6,221,742 $ 25,293,149 Total segment assets $ 59,657,514 $ 7,732,544 $ 67,390,058 The Company’s assets by reportable segment and reconciliation of segment assets to consolidated assets as of December 31, 2020 are summarized as follows: Prescription Medications Medical Devices Consolidated Intangible assets, net $ 24,625,686 $ 7,535,233 $ 32,160,919 Total segment assets $ 60,725,191 $ 9,128,823 $ 69,854,014 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2021 | |
Summary of Significant Accounting Policies | |
Use of Estimates | Use of Estimates The preparation of Consolidated Financial Statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities at the date of the Consolidated Financial Statements and reported amounts of revenue and expenses during the reporting periods. Such estimates include the adequacy of accounts receivable reserves, return reserves, inventory reserves, assessment of long-lived assets, including intangible asset impairment, the allocation of the purchase price in acquisitions and the valuation of the derivative liability, among others. Actual results could differ from these estimates and changes in these estimates are recorded when known. |
Risks and Uncertainties | Risks and Uncertainties The Company is subject to risks common to companies in the pharmaceutical industry including, but not limited to, uncertainties related to commercialization of competitor products, regulatory approvals, dependence on key products, dependence on key customers and suppliers, and protection of intellectual property rights. The World Health Organization (“WHO”) declared the coronavirus (“COVID-19”) a global pandemic on March 11, 2020, and since that time many of the previously imposed restrictions and other measures which were instituted in response have been subsequently reduced or lifted. However, the COVID-19 pandemic remains highly unpredictable and dynamic, and its duration and extent continue to be dependent on various developments, such as the emergence of variants to the virus that may cause additional strains of COVID-19, the administration and ultimate effectiveness of vaccines, and the eventual timeline to achieve a sufficient level of herd immunity among the general population. Accordingly, the COVID-19 pandemic may continue to have negative effects on the health of the U.S. economy for the foreseeable future. The Company cannot reasonably estimate the length or severity of the impact that the COVID-19 pandemic, including the emergence of any new variants, such as the Delta and the Omicron variants, will have on its financial results, and the Company may experience a material adverse impact on its sales, results of operations, and cash flows in fiscal 2022 and beyond. During 2020, government regulations and the voluntary business practices of the Company and prescribing physicians had prevented in-person visits by sales representatives to physicians’ offices. The Company had taken steps to mitigate the negative impact on its businesses of such restrictions. In March 2020, the Company reduced our sales representative head count to reflect the lack of in-person visits. The Company has maintained a core sales team which continued to contact physicians via telephone and videoconference as well as continuing to have webinars provided by the Company’s key opinion leaders to other physicians and pharmacists. In response to the spread of COVID-19, in March 2020, the Company closed its administrative offices and as of December 31, 2021, they remain closed, with the Company’s employees continuing their work remotely. The Company has selectively resumed in-person interactions by its customer-facing personnel in compliance with local and state restrictions. The Company also continues to engage with customers virtually as the Company seeks to continue to support healthcare professionals and patient care. However, the Company’s ability to engage in personal interactions with physicians and customers remains limited, and it is unknown when the Company’s offices will reopen, and these interactions will be fully resumed. In addition, since the beginning of the COVID-19 pandemic, we have experienced a shift from in-person sales to online, telehealth-based sales. These online sales generally have lower gross margins than in-person sales, which has impacted our net revenues. |
Concentration of Credit Risk | Concentration of Credit Risk Financial instruments that subject the Company to concentrations of credit risk includes cash. The Company maintains cash on deposit at U.S.-based banks in amounts which, at times, may be in excess of insured limits. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly-liquid investments that have maturities of three months or less when acquired to be cash equivalents. |
Segment Reporting | Segment Reporting Operating segments are components of a Company for which separate financial information is available and evaluated regularly by the chief operating decision maker in assessing performance and deciding how to allocate resources. The Company’s two segments, Prescription Medications and Medical Devices, focus on the treatment of male erectile dysfunction. The Prescription Medications segment consists primarily of operations related to Stendra®, which is sold generally in the United States, and H100™ for the treatment of Peyronie’s disease. The Medical Devices segment consists primarily of operations related to vacuum erection devices, which are sold domestically and internationally. See Note 18 Segment Reporting. |
Revenue Recognition | Revenue Recognition Prescription Medication Sales The Company’s prescription medication sales consist of sales of Stendra® in the U.S. for the treatment of male erectile dysfunction. Under ASC Topic 606, Revenue Recognition In determining the transaction price, a significant financing component does not exist since the timing from when the Company delivers Stendra® to when the customers pay for the product is typically less than one year. The Company records prescription medication sales net of any variable consideration, including but not limited to discounts, rebates, returns, chargebacks, and distribution fees. The Company uses the expected value method when estimating its variable consideration, unless terms are specified within contracts. The identified variable consideration is recorded as a reduction of revenue at the time revenues from sales of Stendra® are recognized. The Company recognizes revenue to the extent that it is probable that a significant revenue reversal will not occur in a future period. These estimates may differ from actual consideration received. The Company evaluates these estimates each reporting period to reflect known changes. As of December 31, 2021 and 2020, the reserves for sales deductions were $4.7 million and $8.6 million, respectively. The most significant sales deductions included in this reserve relate to returns, contract rebates, and distribution service (“DSA”) fees. Our estimates are based on factors such as our direct and indirect customers’ buying patterns and the estimated resulting contractual deduction rates, historical experience, specific known market events and estimated future trends, current contractual and statutory requirements, industry data, estimated customer inventory levels, current contract sales terms with our direct and indirect customers, and other competitive factors. Significant judgment and estimation is required in developing the foregoing and other relevant assumptions. The most significant sales deductions are further described below. Product Returns Consistent with industry practice, the Company maintains a return policy that generally allows its customers to return Stendra® and receive credit for product within six months prior to expiration date and up to one year after expiration date. The provision for returns is based upon the Company’s estimates for future Stendra® returns and historical experience. The provision of returns is part of the variable consideration recorded at the time revenue is recognized. As of December 31, 2021 and 2020, the reserves for product returns were $3.8 million and $7.1 million, respectively, and are included as a component of accrued expenses. Contract Rebates, Coupon Redemptions and DSA Fees The Company establishes contracts with wholesalers, chain stores, and indirect customers that provide for rebates, sales incentives, DSA fees and other allowances. Some customers receive rebates upon attaining established sales volumes. Direct rebates are generally rebates paid to direct purchasing customers based on a percentage applied to a direct customer’s purchases from us, including fees paid to wholesalers under our DSAs, as described below. Indirect rebates are rebates paid to indirect customers that have purchased our products from a wholesaler under a contract with us. The Company has entered into DSAs with certain of our significant wholesaler customers that obligate the wholesalers, in exchange for fees paid by us, to: (i) manage the variability of their purchases and inventory levels within specified limits based on product demand and (ii) provide us with specific services, including the provision of periodic retail demand information and current inventory levels for our pharmaceutical products held at their warehouse locations. See Note 3. Accounts Receivable, net for further discussion of these reserves. Medical Device Sales The Company’s medical device sales consist of domestic and international sales of men’s health products for the treatment of erectile dysfunction. The men’s health products do not require a prescription and include Vacuum Erection Devices, PreBoost, VenoSeal, penile injections (Rx), and urinary tract infection tests. Under Topic 606, the Company recognizes revenue from medical device sales when its performance obligations with its customers have been satisfied. In the contracts with its customers, the Company has identified a single performance obligation to provide medical devices upon receipt of a customer order. The performance obligation is satisfied at a point in time when the Company’s customers obtain control of the medical device, which is typically upon shipment. The Company invoices its customers after the medical devices have been shipped and invoice payments are generally due within 30 days of invoice date for domestic customers and 90 days for international customers. In determining the transaction price, a significant financing component does not exist since the timing from when the Company delivers the medical devices to when the customers pay for the product is typically less than one year. The Company records medical device sales net of any variable consideration, including but not limited to returns. The Company uses the expected value method when estimating its variable consideration. The identified variable consideration is recorded as a reduction of revenue at the time revenues from the medical device sales are recognized. The Company recognizes revenue to the extent that it is probable that a significant revenue reversal will not occur in a future period. These estimates may differ from actual consideration received. The Company evaluates these estimates each reporting period to reflect known changes. Product Returns Consistent with industry practice, the Company maintains a return policy that generally allows its customers to return medical devices and receive credit for products within 90 days of the sale. The provision for returns is based upon the Company’s estimates for future product returns and historical experience. The Company has not made significant changes to the judgments made in applying Topic 606. As of December 31, 2021 and 2020, the reserves for product returns for medical devices were not significant. Contract Costs In relation to customer contracts, the Company incurs costs to fulfill a contract but does not incur costs to obtain a contract. These costs to fulfill a contract do not meet the criteria for capitalization and are expensed as incurred. As such, the Company did not have any contract assets at December 31, 2021 and 2020. |
Accounts Receivable, net | Accounts Receivable, net The Company extends credit to its customers in the normal course of business. Accounts receivable are recorded at the invoiced amount, net of chargebacks, distribution service fees, and cash discounts. Management determines each allowance based on historical experience along with the present knowledge of potentially uncollectible accounts. See Note 3 Accounts Receivable, net. |
Inventories | Inventories Inventories consist of finished goods held for sale and raw materials. Inventories are stated at the lower of cost or net realizable value, with cost determined using the first-in, first-out method. Inventories are adjusted for excess and obsolescence. Evaluation of excess inventory includes such factors as expiry date, inventory turnover, and management’s assessment of current product demand. See Note 4 Inventories. |
Intangible Assets | Intangible Assets The Company accounts for recognized intangible assets at cost. Intangible assets with finite useful lives are amortized over the useful life that the assets are expected to contribute directly or indirectly to future cash flows. Intangible assets are amortized using an accelerated method based on the pattern in which the economic benefits of the assets are consumed. The Company reviews the carrying value and useful lives of its intangible assets with definite lives whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable or the period over which they should be amortized has changed. When indicators of impairment exist, the Company determines whether the estimated undiscounted sum of the future cash flows of such assets is less than their carrying amounts. If less, an impairment loss is recognized in the amount, if any, by which the carrying amount of such assets exceeds their respective fair values. The Company evaluates the remaining useful life of each intangible asset that is being amortized during each reporting period to determine whether events and circumstances warrant a revision to the remaining period of amortization. If the estimate of the intangible asset’s remaining useful life has changed, the remaining carrying amount of the intangible asset is amortized prospectively over that revised remaining useful life. The Company has determined that no impairment exists as of December 31, 2021. As indicators of impairment exist as of December 31, 2021, the Company prepared an undiscounted cash flow analysis. This analysis includes projections of future revenue and expenses, which if not achieved could result in future impairment charges. These projections include continued significant sales growth based in part on the increase in revenue in 2021, along the expectation of higher sales volume resulting from increased product availability as a result of the Vivus settlement. Additionally, the Company is planning to invest in research and development pursuant to our Non-Prescription / Over-The-Counter ("OTC") Strategies related to Stendra®, which we anticipate will dramatically increase product sales in the future. Given the impact of the COVID-19 outbreak on the global economy, as well as its potential impact to the Company’s business operations and cash flows, the Company constituted the COVID-19 outbreak as a triggering event requiring an impairment test for its long-lived assets with finite useful lives. The Company’s projections included the undiscounted cash flows of the remaining estimated useful lives for the Stendra product through December 2028 and December 2030 for the medical device products. Based on the impairment assessment as of December 31, 2021, and 2020, the Company determined that no intangible asset impairment occurred as the undiscounted cash flows exceeded the respective carrying values of the assets. The Company did not record any impairments of intangible assets for the years ended December 31, 2021 and 2020. |
Fixed Assets | Fixed Assets Fixed assets consist of furniture and fixtures. Furniture and fixtures are recorded at cost, less accumulated depreciation, and are depreciated on a straight-line basis over its estimated useful life. The Company uses an estimated useful life of 7 years for furniture and fixtures. Depreciation expense for each of the years ended December 31, 2021 and 2020 was $10,220. |
Leases | Leases The Company accounts for leases in accordance with Accounting Standards Codification (“ASC”) Topic 842. Topic 842 requires organizations to recognize leased assets and liabilities on the balance sheet. The standard also requires disclosures to help investors and other financial statement users better understand the amount, timing and uncertainty of cash flows arising from leases. The Company determines if an arrangement is a lease at inception. This determination generally depends on whether the arrangement conveys to the Company the right to control the use of an explicitly or implicitly identified fixed asset for a period of time in exchange for consideration. Control of an underlying asset is conveyed to the Company if the Company obtains the rights to direct the use of and to obtain substantially all of the economic benefits from using the underlying asset. The Company has lease agreements that include lease and non-lease components, which the Company accounts for as a single lease component for all leases. Operating lease right-of-use (“ROU”) assets are included in other assets whereas operating lease liabilities are included in other current liabilities and other long-term liabilities on the Company’s consolidated balance sheets. Operating lease ROU assets and operating lease liabilities are recognized at commencement date based on the present value of lease payments over the lease term. The operating lease payments are recognized as lease expense on a straight-line basis over the lease term. Lease payments included in the measurement of the lease liability are comprised of fixed payments. Variable lease payments associated with the Company’s leases are recognized when the event, activity, or circumstance in the lease agreement on which those payments are assessed occurs. Variable lease payments are presented in the Company’s consolidated statements of operations in the same line item as expense arising from fixed lease payments for operating leases. Leases with an initial term of 12 months or less are not recorded on the consolidated balance sheet and the Company recognizes lease expense for these leases on a straight-line basis over the lease term. The Company applies this policy to all underlying asset categories. Topic 842 requires a lessee to discount its unpaid lease payments using the interest rate implicit in the lease or, if that rate cannot be readily determined, its incremental borrowing rate. As the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The lease term for all of the Company’s leases includes the non-cancellable period of the lease plus any additional periods covered by either a Company option to extend (or not to terminate) the lease that the Company is reasonably certain to exercise, or an option to extend (or not to terminate) the lease controlled by the lessor. See Note 15 Commitments and Contingencies for additional information. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Certain assets and liabilities are carried at fair value under U.S. GAAP. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. Financial assets and liabilities carried at fair value are to be classified and disclosed in one of the following three levels of the fair value hierarchy: Level 1 — Quoted prices in active markets for identical assets or liabilities. Level 2 — Observable inputs (other than Level 1 quoted prices), such as quoted prices in active markets for similar assets or liabilities, quoted prices in markets that are not active for identical or similar assets or liabilities, or other inputs that are observable or can be corroborated by observable market. Level 3 — Unobservable inputs which are supported by little or no market activity and that are significant to determining the fair value of the assets or liabilities, including pricing models, discounted cash flow methodologies and similar techniques. Financial instruments recognized at historical amounts in the consolidated balance sheets consist of cash, accounts receivable, other current assets, accounts payable, accrued expenses, and other current liabilities. The Company believes that the carrying values of cash, accounts receivable, other current assets, accounts payable, accrued expenses, and other current liabilities approximate their fair values due to the short-term nature of these instruments. In connection with the Mergers in December 2020, each security holder of Metuchen received an earnout consideration classified as a derivative liability to be paid in the form of Petros Common Stock. The Company estimated their fair value using a Monte Carlo Simulation approach. This fair value measurement is based on significant inputs not observable in the market and thus represents a Level 3 measurement within the fair value hierarchy. The fair value of the derivative liability as of December 31, 2021 and December 31, 2020 was $0.5 million and $9.9 million, respectively. See Note 10 Stockholders’ Equity. |
Deferred Financing Costs | Deferred Financing Costs Costs incurred to issue debt are deferred and presented in the consolidated balance sheets as a direct reduction from the carrying amount of the debt liability, consistent with debt discounts. Related amortization expense is recorded as a component of interest expense over the term of the related debt using the effective interest rate method. |
Stock-Based Compensation | Stock-Based Compensation The Company accounts for stock-based awards to employees and consultants in accordance with applicable accounting principles, which requires compensation expense related to stock-based transactions, including employee stock options and consultant warrants, to be measured and recognized in the financial statements based on a determination of the fair value of the stock options or warrants. The grant date fair value is determined using the Black-Scholes-Merton (“Black-Scholes”) pricing model. Employee stock option and consulting expenses are recognized over the employee’s or consultant’s requisite service period (generally the vesting period of the equity grant). The Company’s option pricing model requires the input of highly subjective assumptions, including the volatility and expected term. Any changes in these highly subjective assumptions can significantly impact stock-based compensation expense. See Note 11 Stock Options. |
Costs of Equity Transactions | Costs of Equity Transactions Incremental direct costs incurred to issue stocks of the Company’s preferred and common stocks are recorded as a reduction of the related proceeds. |
Income Taxes | Income Taxes The Company is a C corporation, which accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, the Company determines deferred tax assets and liabilities on the basis of the differences between the financial statement and tax bases of assets and liabilities by using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. The Company recognizes deferred tax assets to the extent that it believes that these assets are more likely than not to be realized. In making such a determination, the Company considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, and results of recent operations. If the Company determines that it would be able to realize deferred tax assets in the future in excess of its net recorded amount, the Company would make an adjustment to the deferred tax asset valuation allowance, which would reduce the provision for income taxes. The Company records uncertain tax positions in accordance with ASC 740 on the basis of a two step process in which (1) it determines whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, the Company recognizes the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority. The Company recognizes interest and penalties related to unrecognized tax benefits on the income tax expense line in the accompanying consolidated statement of operations. As of December 31, 2021, no accrued interest or penalties are recorded in the consolidated balance sheet. |
Contingencies | Contingencies The Company may be subject to various patent challenges, product liability claims, government investigations and other legal proceedings in the ordinary course of business. Legal fees and other expenses related to litigation are expensed as incurred and included in general and administrative expenses in the consolidated statements of operations. |
Shipping Costs | Shipping Costs The Company records the costs of shipping related to prescription medication sales in general and administrative expense in its consolidated statements of operations. There were no shipping costs for the years ended December 31, 2021 and 2020. Shipping costs related to medical devices are recorded as revenue and subsequently deducted as a component of cost of goods sold in the consolidated statements of operations. Shipping costs for the years ended December 31, 2021 and 2020 were $134,730 and $108,870, respectively. |
Basic and Diluted Net Loss per Common Share | Basic and Diluted Net Loss per Common Share The Company computes basic net loss per common share by dividing net loss applicable to common stockholders by the weighted average number of shares of common stocks outstanding during the period, excluding the anti-dilutive effects of stock options and warrants to purchase common stocks. The Company computes diluted net loss per common stock by dividing the net loss applicable to common stocks by the sum of the weighted-average number of common stocks outstanding during the period plus the potential dilutive effects of its convertible preferred stocks, stock options and warrants to purchase common stocks, but such items are excluded if their effect is anti-dilutive. Because the impact of these items is anti-dilutive during periods of net loss, there was no difference between the Company’s basic and diluted net loss per stock of common stock for the years ended December 31, 2021 and 2020. See Note 13 Basic and Diluted Net Loss per Common Share. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Pending Adoption as of December 31, 2021 In June 2016, the FASB issued ASU No. 2016-13, Measurement of Credit Losses on Financial Instruments |
Accounts Receivable, net (Table
Accounts Receivable, net (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Accounts Receivable, net | |
Summary of accounts receivable | December 31, December 31, 2021 2020 Gross accounts receivables $ 3,363,827 $ 6,560,291 Distribution service fees (371,310) (972,652) Chargebacks accruals — (121,269) Cash discount allowances (159,446) (84,601) Allowance for doubtful accounts (377,685) (228,800) Total accounts receivable, net $ 2,455,386 $ 5,152,969 |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Inventories | |
Schedule of Inventories | December 31, 2021 December 31, 2020 Raw materials $ 359,741 $ 325,932 Finished goods 159,908 434,598 Total inventory $ 519,649 $ 760,530 |
Prepaid Expenses and Other Cu_2
Prepaid Expenses and Other Current Assets (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Prepaid Expenses and Other Current Assets. | |
Schedule of Prepaid Expenses and Other Current Assets | December 31, 2021 December 31, 2020 Prepaid samples $ — $ 58,483 Prepaid insurance 73,223 149,452 Prepaid FDA fees 831,179 756,972 Prepaid coupon fees 71,500 71,500 API purchase commitment asset (see Note 14) 1,419,538 1,304,541 Due from wholesalers 609,059 — Other prepaid expenses 605,422 391,552 Other current assets 110,167 114,784 Total prepaid expenses and other current assets $ 3,720,088 $ 2,847,284 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Intangible Assets | |
Schedule of intangible assets | Balance at December 31, 2019 $ 38,811,137 Amortization expense (6,650,218) Balance at December 31, 2020 32,160,919 Amortization expense (6,867,770) Balance at December 31, 2021 $ 25,293,149 |
Schedule of future annual amortization of intangible assets | 2022 $ 6,191,740 2023 5,445,729 2024 4,650,787 2025 2,716,011 2026 2,201,720 Thereafter 4,087,162 Total $ 25,293,149 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Accrued Expenses | |
Summary of accrued expenses | December 31, 2021 December 31, 2020 Accrued price protection $ 1,853,979 $ 1,853,979 Accrued product returns 6,192,845 9,452,248 Accrued contract rebates 379,242 412,046 Due to Vivus (see Note 14) 2,267,523 2,267,523 Due to third-party logistic provider 479,178 — Accrued severance — 519,609 Accrued bonuses 527,563 — Accrued professional fees 125,392 — Other accrued expenses 131,662 178,381 Total accrued expenses $ 11,957,384 $ 14,683,786 |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Debt | |
Summary of senior indebtedness | December 31, 2020 Principal balance $ 6,653,292 Plus: Paid-In-Kind interest — Plus: End of term fee 534,237 Less: Unamortized Debt issuance costs (12,500) Total senior debt $ 7,175,029 |
Summary of interest expense on the Senior Debt | For the Years Ended December 31, 2021 2020 Interest expense for term loan $ 356,160 $ 1,241,475 Amortization of debt issuance costs 12,500 37,500 PIK interest — 44,449 $ 368,660 $ 1,323,424 |
Stock Options and Restricted _2
Stock Options and Restricted Stock Units (''RSU's'') (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Stock Options and Restricted Stock Units ("RSU's") | |
Summary of stock options | Weighted-Average Aggregate Instrinsic Weighted-Average Remaining Contractual Value Number of Shares Exercise Price Term (Years) ($ in thousands) Options outstanding at December 1, 2020 574,331 $ 51.43 0.9 $ — Options granted — — — — Less: options forfeited — — — — Less: options expired/cancelled — — — — Less: options exercised — — — — Options outstanding at December 31, 2020 574,331 $ 51.43 0.9 $ — Options granted 615,669 3.38 9.23 — Less: options forfeited — — — — Less: options expired/cancelled (574,331) 51.43 — — Less: options exercised — — — — Options outstanding at December 31, 2021 615,669 $ 3.38 9.23 $ — Options exercisable at December 31, 2021 277,835 $ 3.40 9.23 $ — Weighted-Average Aggregate Intrinsic Weighted-Average Remaining Contractual Value Number of Shares Exercise Price Term (Years) ($in thousands) RSU’s outstanding at December 31, 2020 — $ — — $ — RSU’s granted 116,383 3.29 9.84 — Less: RSU’s forfeited — — — — Less: RSU’s expired/cancelled — — — — Less: RSU’s exercised — — — — RSU’s outstanding at December 31, 2021 116,383 $ 3.29 9.84 $ — RSU’s exercisable at December 31, 2021 — $ — — $ — |
Common Stock Warrants (Tables)
Common Stock Warrants (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Common Stock Warrants | |
Summary of warrants | Number of Shares Warrants outstanding at December 1, 2020 4,407,962 Warrants issued — Warrants exercised — Warrants expired — Warrants outstanding at December 31, 2020 4,407,962 Warrants issued 7,853,558 Warrants exercised (2,014,586) Warrants expired (207,913) Warrants outstanding at December 31, 2021 10,039,021 |
Summary of warrants by expiration date | Number of Warrants Exercise Price Expiration Date 2,780 1.60 August 23, 2023 22,800 35.65 June 1, 2024 74,864 21.85 June 17, 2024 20,043 31.25 June 19, 2024 22,800 26.55 September 1, 2024 10,500 12.738 September 16, 2024 22,800 4.30 December 1, 2024 28,000 5.65 March 2, 2025 28,000 7.30 June 1, 2025 28,000 5.50 September 1, 2025 28,000 4.705 December 1, 2025 2,221,829 7.50 December 1, 2025 908,498 17.50 December 1, 2025 623,303 51.25 December 1, 2025 157,832 125.00 December 1, 2025 1,751,311 1.715 October 18, 2026 2,337,719 3.50 December 12, 2026 1,749,942 3.50 December 27, 2026 10,039,021 |
Basic and Diluted Net Loss pe_2
Basic and Diluted Net Loss per Common Share (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Basic and Diluted Net Loss per Common Share | |
Summary of Computation of Basic and Diluted Net Loss per Share | For the Years Ended December 31, 2021 2020 Numerator Net (loss) income $ (8,986,676) $ (20,585,925) Denominator Weighted-average common shares for basic and diluted net loss per unit 10,889,766 5,340,682 Basic and diluted net loss per common share $ (0.83) $ (3.85) |
Summary of Potentially dilutive securities convertible into common shares | For the Years Ended December 31, 2021 2020 Stock options 615,669 574,331 RSUs 116,383 — Warrants 10,039,021 4,407,962 Total 10,771,073 4,982,293 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Commitments and Contingencies | |
Summary of components of lease expense | For the Years Ended December 31, 2021 2020 Operating Lease Cost: Fixed lease cost $ 179,246 $ 179,246 |
Summary of supplemental balance sheet information related to leases | Supplemental balance sheet information related to leases was as follows: As of December 31, 2021 As of December 31, 2020 Operating lease ROU asset: Other assets $ 475,557 $ 579,535 Operating lease liability: Other current liabilities $ 125,579 $ 108,971 Other long-term liabilities 405,018 530,597 Total operating lease liability $ 530,597 $ 639,568 |
Summary of supplemental lease term and discount rate information related to leases | Supplemental lease term and discount rate information related to leases was as follows: As of December 31, 2021 As of December 31, 2020 Weighted-average remaining lease terms - operating leases 3.69 years 4.7 years Weighted-average discount rate - operating leases 12.6 % 12.6 % |
Summary of supplemental cash flow information related to leases | Supplemental cash flow information related to leases was as follows: For the Years Ended December 31, 2021 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 184,239 $ 182,639 |
Summary of future minimum lease payments under non-cancelable leases | Future minimum lease payments under non-cancelable leases as of December 31, 2021 were as follows: Lease Liability Maturity Analysis Operating Leases 2022 $ 187,739 2023 189,374 2024 155,242 2025 81,107 2026 82,324 Thereafter — Total lease payments 695,787 Less: Imputed Interest (165,190) Total $ 530,597 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Income Taxes | |
Summary of current and deferred income tax expense (benefit) | For the Years Ended December 31, 2021 2020 Current expense (benefit): Federal $ — $ 5,085 State — 88 Total current expense (benefit) — 5,173 Deferred expense (benefit): Federal — (1,378,731) State — (53,435) Total deferred expense (benefit) — (1,432,166) Total income tax expense (benefit) $ — $ (1,426,993) |
Summary of reconciliation of the Company's statutory income tax rate to the Company's effective income tax rate | For the Years Ended December 31, 2021 2020 Income at US statutory rate 21.00 % 21.00 % State taxes, net of federal benefit (0.61) % 1.56 % Permanent differences 22.31 % (2.68) % Recapitalization 0.00 % 36.49 % Pass through income to members 0.00 % (32.71) % Book income return to provision 7.43 % 0.00 % Valuation allowance (55.55) % (17.22) % Adjustment to opening deferrals - short period 5.42 % 0.00 % Effective income tax rate 0.00 % 6.44 % |
Summary of significant components of the Company's deferred tax assets and liabilities | For the Years Ended December 31, 2021 2020 Accruals $ 186,739 $ 90,222 Intangible assets (1,006,954) (1,238,128) Depreciation and amortization 5,669,065 5,661,235 Expenses not currently deductible 815,108 148,708 Net operating loss carryforwards 3,702,789 57,266 Interest expense limitation 96,920 25,547 Stock-based compensation 2,716,370 2,505,425 Valuation allowance (12,180,037) (7,250,275) Total deferred tax liability $ — $ — |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Segment Information | |
Summary of results of operations by reportable segment | The Company’s results of operations by reportable segment for the year ended December 31, 2021 are summarized as follows: Prescription Medical For the year ended December 31, 2021 Medications Devices Corporate Consolidated Net sales $ 4,605,043 $ 3,206,221 $ — $ 7,811,264 Cost of goods sold 577,795 1,021,771 — 1,599,566 Selling, general and administrative expenses 6,473,482 2,620,403 6,499,348 15,593,233 Research and development expenses 1,788,491 — — 1,788,491 Depreciation and amortization expense 5,564,499 1,313,491 — 6,877,990 Change in fair value of derivative liability — — (9,430,000) (9,430,000) Interest expense — — 368,660 368,660 Net loss $ (9,799,224) $ (1,749,444) $ 2,561,992 $ (8,986,676) The Company’s results of operations by reportable segment for the year ended December 31, 2020 are summarized as follows: Prescription Medical For the year ended December 31, 2020 Medications Devices Corporate Consolidated Net sales $ 6,357,498 $ 3,201,971 $ — $ 9,559,469 Cost of goods sold 3,083,417 963,049 — 4,046,466 Selling, general and administrative expenses 8,784,716 2,024,448 4,865,804 15,674,968 Research and development expense 459,636 — — 459,636 Depreciation and amortization expense 5,424,292 1,236,146 — 6,660,438 Change in fair value of derivative liability — — 1,680,000 1,680,000 Interest expense — — 3,050,879 3,050,879 Income tax benefit — 1,426,993 — 1,426,993 Net loss $ (11,394,563) $ (405,321) $ (9,596,683) $ (20,585,925) |
Summary of net sales by geographic region | For the Years Ended December 31, Net sales 2021 2020 United States $ 6,572,849 $ 8,555,831 International 1,238,415 1,003,638 $ 7,811,264 $ 9,559,469 |
Summary of assets by reportable segment and reconciliation of segment assets to consolidated assets | The Company’s assets by reportable segment and reconciliation of segment assets to consolidated assets as of December 31, 2021 are summarized as follows: Prescription Medications Medical Devices Consolidated Intangible assets, net $ 19,071,407 $ 6,221,742 $ 25,293,149 Total segment assets $ 59,657,514 $ 7,732,544 $ 67,390,058 The Company’s assets by reportable segment and reconciliation of segment assets to consolidated assets as of December 31, 2020 are summarized as follows: Prescription Medications Medical Devices Consolidated Intangible assets, net $ 24,625,686 $ 7,535,233 $ 32,160,919 Total segment assets $ 60,725,191 $ 9,128,823 $ 69,854,014 |
Nature of Operations, Basis o_2
Nature of Operations, Basis of Presentation, and Liquidity (Details) - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 07, 2020 |
Nature of Operations, Basis of Presentation, and Liquidity [Line Items] | |||
Cash in excess of certain limit, subject to adjustment as provided in the Merger Agreement | $ 20,000,000 | ||
Common stock, par value | $ 0.0001 | $ 0.0001 | $ 0.0001 |
Preferred stock, par value | $ 0.0001 | $ 0.0001 | $ 0.001 |
Metuchen Securityholders | |||
Nature of Operations, Basis of Presentation, and Liquidity [Line Items] | |||
Percentage of equity securities held | 51.00% |
Nature of Operations, Basis o_3
Nature of Operations, Basis of Presentation, and Liquidity - Additional information (Details) - USD ($) | Nov. 03, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | Jan. 31, 2022 | Jan. 18, 2022 |
Nature of Operations, Basis of Presentation, and Liquidity [Line Items] | |||||
Cash | $ 23,847,572 | $ 17,139,694 | |||
Negative working capital | 400,000 | ||||
Debt | 7,175,029 | ||||
Sustained cumulative losses attributable to common stockholders | (70,688,820) | (61,702,144) | |||
Number of shares issued | 21,745,003 | ||||
Net proceeds | 21,745,003 | ||||
Repayment of senior debt | $ 1,179,651 | $ 6,653,292 | $ 6,181,711 | ||
Vivus, Inc | Settlement Agreement | Promissory Note | |||||
Nature of Operations, Basis of Presentation, and Liquidity [Line Items] | |||||
Principal amount of notes payable | $ 10,201,758 | ||||
Subsequent event | Vivus, Inc | Settlement Agreement | |||||
Nature of Operations, Basis of Presentation, and Liquidity [Line Items] | |||||
Principal amount of notes payable | $ 10,201,758 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Disaggregation of Revenue [Line Items] | ||
Reserves for product returns | $ 3.8 | $ 7.1 |
Revenue, Practical Expedient, Financing Component [true false] | true | |
Prescription Medication Sales | ||
Disaggregation of Revenue [Line Items] | ||
Reserves for sales deductions | $ 4.7 | $ 8.6 |
Medical Device Sales | ||
Disaggregation of Revenue [Line Items] | ||
Right to return and receive credit for product | 90 days | |
Minimum | Prescription Medication Sales | ||
Disaggregation of Revenue [Line Items] | ||
Due period for invoice payments | 30 days | |
Right to return and receive credit for product | 6 months | |
Minimum | Medical Device Sales | Domestic customers | ||
Disaggregation of Revenue [Line Items] | ||
Due period for invoice payments | 30 days | |
Maximum | Prescription Medication Sales | ||
Disaggregation of Revenue [Line Items] | ||
Due period for invoice payments | 75 days | |
Right to return and receive credit for product | 1 year | |
Maximum | Medical Device Sales | International Customers [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Due period for invoice payments | 90 days |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Additional information (Details) | 12 Months Ended | |
Dec. 31, 2021USD ($)segment | Dec. 31, 2020USD ($) | |
Fair Value of Financial Instruments | ||
Fair value of the derivative liability | $ 500,000 | $ 9,900,000 |
Income Taxes | ||
Accrued interest or penalties | $ 0 | |
Number of operating segments | segment | 2 | |
Shipping costs | $ 0 | 0 |
Medical Device Sales | ||
Income Taxes | ||
Shipping costs | $ 134,730 | 108,870 |
Furniture and Fixtures [Member] | ||
Income Taxes | ||
Estimated useful life (in years) | 7 years | |
Depreciation expense | $ 10,220 | $ 10,220 |
Accounts Receivable, net (Detai
Accounts Receivable, net (Details) - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Accounts Receivable, net | ||
Gross accounts receivables | $ 3,363,827 | $ 6,560,291 |
Distribution service fees | (371,310) | (972,652) |
Chargebacks accrual | (121,269) | |
Cash discount allowances | (159,446) | (84,601) |
Allowance for doubtful accounts | (377,685) | (228,800) |
Total accounts receivable, net | $ 2,455,386 | $ 5,152,969 |
Accounts Receivable, net - Addi
Accounts Receivable, net - Additional information (Details) - customer | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Gross sales from customers | Customer concentration risk | ||
Concentration Risk [Line Items] | ||
Number of customers | 5 | 1 |
Gross sales from customers | Customer concentration risk | One customers | ||
Concentration Risk [Line Items] | ||
Concentration risk percentage | 27.00% | 85.00% |
Gross sales from customers | Customer concentration risk | Two customers | ||
Concentration Risk [Line Items] | ||
Concentration risk percentage | 22.00% | |
Gross sales from customers | Customer concentration risk | Three Customer | ||
Concentration Risk [Line Items] | ||
Concentration risk percentage | 16.00% | |
Gross sales from customers | Customer concentration risk | Four customers | ||
Concentration Risk [Line Items] | ||
Concentration risk percentage | 13.00% | |
Gross sales from customers | Customer concentration risk | Five Customers | ||
Concentration Risk [Line Items] | ||
Concentration risk percentage | 11.00% | |
Receivables from customers | Credit concentration risk | ||
Concentration Risk [Line Items] | ||
Number of customers | 3 | 1 |
Receivables from customers | Credit concentration risk | One customers | ||
Concentration Risk [Line Items] | ||
Concentration risk percentage | 40.00% | 93.00% |
Receivables from customers | Credit concentration risk | Two customers | ||
Concentration Risk [Line Items] | ||
Concentration risk percentage | 19.00% | |
Receivables from customers | Credit concentration risk | Three Customer | ||
Concentration Risk [Line Items] | ||
Concentration risk percentage | 15.00% |
Inventories (Details)
Inventories (Details) - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Inventories | ||
Raw materials | $ 359,741 | $ 325,932 |
Finished goods | 159,908 | 434,598 |
Total inventory | $ 519,649 | $ 760,530 |
Inventories - Additional Inform
Inventories - Additional Information (Details) - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Inventories | ||
Finished goods are net of valuation reserves | $ 383,298 | $ 935,866 |
Raw materials are net of valuation reserves | $ 2,872,977 | $ 2,872,977 |
Prepaid Expenses and Other Cu_3
Prepaid Expenses and Other Current Assets (Details) - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Prepaid Expenses and Other Current Assets. | ||
Prepaid samples | $ 58,483 | |
Prepaid insurance | $ 73,223 | 149,452 |
Prepaid FDA fees | 831,179 | 756,972 |
Prepaid coupon fees | 71,500 | 71,500 |
API purchase commitment asset (see Note 14) | 1,419,538 | 1,304,541 |
Due from wholesalers | 609,059 | |
Other prepaid expenses | 605,422 | 391,552 |
Other current assets | 110,167 | 114,784 |
Total prepaid expenses and other current assets | $ 3,720,088 | $ 2,847,284 |
Prepaid Expenses and Other Cu_4
Prepaid Expenses and Other Current Assets - Additional Information (Details) - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Prepaid Expenses and Other Current Assets. | ||
prepaid samples reserve amount | $ 0 | $ 351,224 |
Intangible Assets (Details)
Intangible Assets (Details) - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Finite-lived Intangible Assets [Roll Forward] | ||
Amortization expense | $ (6,867,770) | $ (6,650,218) |
Intangible Assets - Future annu
Intangible Assets - Future annual amortization (Details) - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Intangible Assets | |||
2022 | $ 6,191,740 | ||
2023 | 5,445,729 | ||
2024 | 4,650,787 | ||
2025 | 2,716,011 | ||
2026 | 2,201,720 | ||
Thereafter | 4,087,162 | ||
Total | $ 25,293,149 | $ 32,160,919 | $ 38,811,137 |
Intangible Assets - Additional
Intangible Assets - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Finite-Lived Intangible Assets [Line Items] | |||
Carrying value of intangible assets | $ 25,293,149 | $ 32,160,919 | $ 38,811,137 |
Stendra Product | |||
Finite-Lived Intangible Assets [Line Items] | |||
Estimated useful lives of intangible assets | 10 years | ||
Carrying value of intangible assets | $ 19,100,000 | 24,600,000 | |
Timm Medical product | |||
Finite-Lived Intangible Assets [Line Items] | |||
Estimated useful lives of intangible assets | 12 years | ||
Carrying value of intangible assets | $ 4,900,000 | 5,900,000 | |
PTV product | |||
Finite-Lived Intangible Assets [Line Items] | |||
Estimated useful lives of intangible assets | 12 years | ||
Carrying value of intangible assets | $ 1,300,000 | $ 1,600,000 |
Accrued Expenses (Details)
Accrued Expenses (Details) - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Accrued Expenses | ||
Accrued price protection | $ 1,853,979 | $ 1,853,979 |
Accrued product returns | 6,192,845 | 9,452,248 |
Accrued contract rebates | 379,242 | 412,046 |
Due to Vivus (see Note 14) | 2,267,523 | 2,267,523 |
Due to third-party logistic provider | 479,178 | |
Accrued severance | 519,609 | |
Accrued bonuses | 527,563 | |
Accrued professional fees | 125,392 | |
Other accrued expenses | 131,662 | 178,381 |
Total accrued expenses | $ 11,957,384 | $ 14,683,786 |
Debt - Senior indebtedness (Det
Debt - Senior indebtedness (Details) | Dec. 31, 2020USD ($) |
Debt | |
Principal balance | $ 6,653,292 |
Plus: End of term fee | 534,237 |
Less: Unamortized Debt issuance costs | (12,500) |
Total senior debt | $ 7,175,029 |
Debt - Senior debt (Details)
Debt - Senior debt (Details) | Apr. 13, 2020 | Mar. 31, 2020 | Nov. 22, 2017USD ($) | Sep. 30, 2016USD ($) | Sep. 30, 2016USD ($) | Dec. 31, 2020USD ($) |
Debt Instrument [Line Items] | ||||||
End of term charge | $ 534,237 | |||||
Senior debt | ||||||
Debt Instrument [Line Items] | ||||||
Face amount of debt | $ 1,068,750 | $ 35,000,000 | $ 35,000,000 | |||
Stated interest rate | 11.50% | 10.75% | ||||
Paid-In-Kind ("PIK") interest rate | 1.35% | 10.75% | ||||
End of term charge | 1,068,750 | $ 787,500 | $ 787,500 | |||
Amount of principal prepaid | $ 10,000,000,000,000 | |||||
Percentage added to variable rate | 11.50% | 10.75% | ||||
Senior debt | Minimum | ||||||
Debt Instrument [Line Items] | ||||||
Fixed charge coverage ratio | 0.9 | |||||
Senior debt | Maximum | ||||||
Debt Instrument [Line Items] | ||||||
Fixed charge coverage ratio | 1 | |||||
Senior debt | Prime rate | ||||||
Debt Instrument [Line Items] | ||||||
Spread on variable rate | 4.25% | 4.50% | ||||
Stated interest rate | 7.25% | 7.25% | ||||
Percentage added to variable rate | 7.25% | 7.25% | ||||
Debt Instrument, Basis Spread on Variable Rate | 4.25% | 4.50% |
Debt - Financial covenant (Deta
Debt - Financial covenant (Details) - USD ($) | Feb. 01, 2021 | Oct. 01, 2020 | Apr. 13, 2020 | Mar. 31, 2020 | Dec. 31, 2020 | Nov. 22, 2017 | Sep. 30, 2016 |
Debt Instrument [Line Items] | |||||||
End of term charge | $ 534,237 | ||||||
Senior debt | |||||||
Debt Instrument [Line Items] | |||||||
Stated interest rate | 11.50% | 10.75% | |||||
End of term fee paid | $ 534,375 | $ 534,375 | |||||
End of term charge | $ 1,068,750 | $ 787,500 | |||||
Senior debt | Prime rate | |||||||
Debt Instrument [Line Items] | |||||||
Stated interest rate | 7.25% | ||||||
Spread on variable rate | 4.25% | 4.50% |
Debt - Third Amendment (Details
Debt - Third Amendment (Details) - USD ($) | Nov. 03, 2021 | Sep. 30, 2020 | Dec. 31, 2021 | Dec. 31, 2020 |
Debt Instrument [Line Items] | ||||
Repayment of senior debt | $ 1,179,651 | $ 6,653,292 | $ 6,181,711 | |
Senior debt | ||||
Debt Instrument [Line Items] | ||||
Required cash proceeds through an equity or debt financing or other transaction | $ 25,000,000 | |||
Escrow fund | $ 1,500,000 |
Debt - Interest Expenses (Detai
Debt - Interest Expenses (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Debt | ||
Interest expense for term loan | $ 356,160 | $ 1,241,475 |
Amortization of debt issuance costs | 12,500 | 37,500 |
PIK interest | 44,449 | |
Interest expense, senior debt | $ 368,660 | 1,323,424 |
Accrued and unpaid interest | $ 65,885 |
Debt - Subordinated Related Par
Debt - Subordinated Related Party Term Loans (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Related Party Transaction [Line Items] | ||
Outstanding principal balance of the subordinated promissory note and accrued PIK interest | $ 0 | $ 0 |
Debt, interest expense | $ 368,660 | 3,050,879 |
PIK interest | 44,449 | |
Interest expenses | 1,727,455 | |
First Subordinated Promissory Note | ||
Related Party Transaction [Line Items] | ||
Principal amount of notes payable | $ 15,500,000 | |
Paid-In-Kind ("PIK") interest rate | 20.00% |
Debt - Subordinated Related P_2
Debt - Subordinated Related Party Term Loans Prior to 2020 (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Debt | ||
Sub Debt principal balance | $ 6,653,292 | |
Interest expense on the Senior Debt | $ 368,660 | 3,050,879 |
PIK interest | $ 44,449 |
Members' Capital (Details)
Members' Capital (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Members' Capital | ||
Proceeds from the exercise of warrants | $ 4,012,435 | $ 20,551 |
Stockholders' Equity - Consumma
Stockholders' Equity - Consummation of the Mergers (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 07, 2020 | |
Class of Stock [Line Items] | |||
Common stock, par value | $ 0.0001 | $ 0.0001 | $ 0.0001 |
Preferred stock, par value | 0.0001 | $ 0.0001 | $ 0.001 |
Common Stock | Metuchen | |||
Class of Stock [Line Items] | |||
Common stock, par value | 0.0001 | ||
Exchange rate per share | $ 0.4968 | ||
Number of shares of Common Stock issued to the holders in exchange | 4,949,610 | ||
Common Stock | Neurotrope | |||
Class of Stock [Line Items] | |||
Common stock, par value | $ 0.0001 | ||
Number of shares issued for every share of old entity | 1 | ||
Number of shares exchanged for every share of of new entity | 5 | ||
Number of warrants issued for every warrants to purchase share of Common Stock of old entity | 1 | ||
Number of warrants exchanged for every warrants to purchase share of Common Stock of new entity | 5 | ||
Preferred Stock | Neurotrope | |||
Class of Stock [Line Items] | |||
Preferred stock, par value | $ 0.001 |
Stockholders' Equity - Number o
Stockholders' Equity - Number of shares held (Details) - USD ($) | Jun. 04, 2021 | Apr. 01, 2021 | Jan. 26, 2021 | Jan. 01, 2021 | Dec. 31, 2021 |
Service Agreement with IRTH | |||||
Class of Stock [Line Items] | |||||
Monthly retainer amount | $ 6,750 | ||||
Number of restricted shares issued | 28,338 | ||||
Restricted share cash value | $ 90,002 | ||||
CorProminence, LLC | Marketing and Consulting Agreement | |||||
Class of Stock [Line Items] | |||||
Term of agreement | 1 year | ||||
Renewal term of agreement | 1 year | ||||
Monthly retainer amount | $ 7,500 | ||||
Number of restricted shares issued | 30,000 | ||||
Tania King | Consulting and Advisory Agreement | |||||
Class of Stock [Line Items] | |||||
Monthly retainer amount | $ 4,000 | ||||
Additional payment included with the first monthly fee | 12,000 | ||||
Restricted share cash value | $ 72,000 | ||||
Neurotrope | |||||
Class of Stock [Line Items] | |||||
Ownership interest taken | 51.00% | ||||
Metuchen | |||||
Class of Stock [Line Items] | |||||
Number of shares held | 4,949,610 | ||||
Ownership interest taken | 49.00% | ||||
Common Stock | |||||
Class of Stock [Line Items] | |||||
Number of common stock issued upon conversion | 60,606 | ||||
Common Stock | Neurotrope | |||||
Class of Stock [Line Items] | |||||
Number of shares held | 4,758,045 | ||||
Preferred Stock | |||||
Class of Stock [Line Items] | |||||
Number of preferred stock converted | 500 | ||||
Preferred Stock | Neurotrope | |||||
Class of Stock [Line Items] | |||||
Number of shares held | 500 |
Stockholders' Equity - Backstop
Stockholders' Equity - Backstop Agreement (Details) - Backstop Agreement - Juggernaut | Dec. 31, 2021USD ($) |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |
Commitment Cap for working capital shortfall amount | $ 6,000,000 |
Working Capital Shortfall Amount | $ 2,600,000 |
Stockholders' Equity - Continge
Stockholders' Equity - Contingent Consideration (Details) | 12 Months Ended |
Dec. 31, 2021shares | |
Stockholders' Equity | |
Common Stock potentially issuable upon the achievement of certain milestones | 14,232,090 |
Milestones term for achievement of stock price and market capitalization | 2 years |
Stockholders' Equity - Mileston
Stockholders' Equity - Milestone Earnout Payments (Details) - Milestone Earnout Payments | 12 Months Ended |
Dec. 31, 2021D$ / sharesshares | |
Maximum | Metuchen | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |
Milestone earnout payments (in shares) | 4,000,000 |
Closing price any time prior to the one-year anniversary of the Closing | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |
Number of trading days for stock price trigger | D | 20 |
Number of consecutive trading days for stock price trigger | D | 30 |
Closing Price per share of $10.00 | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |
Milestone earnout payments (in shares) | 1,000,000 |
Closing price any time within the twelve month period following the one-year anniversary of the Closing | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |
Number of trading days for stock price trigger | D | 20 |
Number of consecutive trading days for stock price trigger | D | 30 |
Closing Price Per share of $10.00 | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |
Stock price trigger | $ / shares | $ 10 |
Closing Price per share of $12.50 | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |
Stock price trigger | $ / shares | $ 12.50 |
Milestone earnout payments (in shares) | 1,000,000 |
Closing Price per share of $16.25 | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |
Stock price trigger | $ / shares | $ 16.25 |
Milestone earnout payments (in shares) | 1,000,000 |
Closing Price per share of $18.75 | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |
Stock price trigger | $ / shares | $ 18.75 |
Milestone earnout payments (in shares) | 1,000,000 |
Stockholders' Equity - Market C
Stockholders' Equity - Market Capitalization (Details) | 12 Months Ended | |
Dec. 31, 2021USD ($)D$ / sharesshares | Dec. 31, 2020USD ($)shares | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||
Fair value of the derivative liability | $ 500,000 | $ 9,900,000 |
Market Capitalization/Gross Proceeds Earnout Payments | Metuchen | ||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||
Milestone earnout payments (in shares) | shares | 500,000 | 9,900,000 |
Market Capitalization/Gross Proceeds Earnout Payments | Maximum | Metuchen | ||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||
Milestone earnout payments (in shares) | shares | 10,232,090 | |
Market Capitalization/Gross Proceeds Earnout Payments | Market Capitalization is greater than or equal to $250,000,000 | Metuchen | ||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||
Milestone earnout payments (in shares) | shares | 2,000,000 | |
Market Capitalization | $ 250,000,000 | |
Number of trading days for stock price trigger | D | 20 | |
Number of consecutive trading days for stock price trigger | D | 30 | |
Stock price | $ / shares | $ 17.50 | |
Aggregate gross proceeds | $ 25,000,000 | |
Term to receive gross proceeds | 60 days | |
Market Capitalization/Gross Proceeds Earnout Payments | Market Capitalization is greater than or equal to $300,000,000 | Metuchen | ||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||
Milestone earnout payments (in shares) | shares | 2,000,000 | |
Market Capitalization | $ 300,000,000 | |
Number of trading days for stock price trigger | D | 20 | |
Number of consecutive trading days for stock price trigger | D | 30 | |
Stock price | $ / shares | $ 18.75 | |
Aggregate gross proceeds | $ 30,000,000 | |
Term to receive gross proceeds | 60 days | |
Market Capitalization/Gross Proceeds Earnout Payments | Market Capitalization is greater than or equal to $400,000,000 | Metuchen | ||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||
Milestone earnout payments (in shares) | shares | 3,000,000 | |
Market Capitalization | $ 400,000,000 | |
Number of trading days for stock price trigger | D | 20 | |
Number of consecutive trading days for stock price trigger | D | 30 | |
Stock price | $ / shares | $ 22.50 | |
Aggregate gross proceeds | $ 40,000,000 | |
Term to receive gross proceeds | 60 days | |
Market Capitalization/Gross Proceeds Earnout Payments | Market Capitalization is greater than or equal to $500,000,000 | Metuchen | ||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||
Milestone earnout payments (in shares) | shares | 3,232,090 | |
Market Capitalization | $ 500,000,000 | |
Number of trading days for stock price trigger | D | 20 | |
Number of consecutive trading days for stock price trigger | D | 30 | |
Stock price | $ / shares | $ 23.75 | |
Aggregate gross proceeds | $ 50,000,000 | |
Term to receive gross proceeds | 60 days |
Stock Options and Restricted _3
Stock Options and Restricted Stock Units (''RSU's'') (Details) - shares | Dec. 22, 2021 | Dec. 31, 2021 |
Stock Options and Restricted Stock Units ("RSU's") | ||
Number of shares authorized | 2,600,000 | |
Number of shares available for issuance | 1,867,948 | |
Number of shares increased for issuance | 1,521,654 | |
Number of shares available for issuance | 2,600,000 |
Stock Options and Restricted _4
Stock Options and Restricted Stock Units (''RSU's'') - Summary of stock options (Details) - $ / shares | May 11, 2021 | Apr. 23, 2021 | Apr. 08, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Number of Shares | ||||||
Options outstanding and exercisable on beginning | 574,331 | 574,331 | ||||
Options granted | 150,000 | 615,669 | ||||
Less: options and RSU's expired/cancelled | 574,331 | |||||
Options and RSU's outstanding at the end | 615,669 | 574,331 | 574,331 | |||
Options and RSU's exercisable at the end | 277,835 | |||||
Weighted-Average Exercise Price | ||||||
Options outstanding and exercisable at the beginning (in dollars per share) | $ 51.43 | $ 51.43 | ||||
Options granted (in dollars per share) | $ 3.21 | 3.38 | ||||
Less: options expired/cancelled (in dollars per share) | 51.43 | |||||
Options outstanding at the end (in dollars per share) | 3.38 | $ 51.43 | $ 51.43 | |||
Options exercisable at the end (in dollars per share) | $ 3.40 | |||||
Weighted-Average Remaining Contractual Term (Years) and Aggregate Intrinsic Value | ||||||
Options outstanding and exercisable at the beginning (in years) | 9 years 2 months 23 days | 10 months 24 days | 10 months 24 days | |||
Options granted (in years) | 9 years 2 months 23 days | |||||
Options outstanding at the end (in years) | 9 years 2 months 23 days | 10 months 24 days | 10 months 24 days | |||
Options exercisable at the end (in years) | 9 years 2 months 23 days | |||||
Restricted Stock Units | ||||||
Number of Shares | ||||||
Options granted | 23,301 | 93,802 | 116,383 | |||
Options and RSU's outstanding at the end | 116,383 | |||||
Weighted-Average Exercise Price | ||||||
Options granted (in dollars per share) | $ 3.09 | $ 3.29 | ||||
Options outstanding at the end (in dollars per share) | $ 3.29 | |||||
Weighted-Average Remaining Contractual Term (Years) and Aggregate Intrinsic Value | ||||||
Options outstanding and exercisable at the beginning (in years) | 9 years 10 months 2 days | |||||
Options granted (in years) | 9 years 10 months 2 days | |||||
Options outstanding at the end (in years) | 9 years 10 months 2 days | |||||
Options exercisable at the end (in years) | 0 years |
Stock Options and Restricted _5
Stock Options and Restricted Stock Units (''RSU's'') - Term of exercise stock options (Details) | 12 Months Ended |
Dec. 31, 2021 | |
Neurotrope | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Term for exercise the stock options | 1 year |
Stock Options and Restricted _6
Stock Options and Restricted Stock Units (''RSU's'') - Fady Boctor, the President and Chief Commercial Officer (Details) - $ / shares | May 11, 2021 | Feb. 19, 2021 | Dec. 31, 2021 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of options granted | 150,000 | 615,669 | |
Exercise price | $ 3.21 | $ 3.38 | |
Vesting percentage | 30.00% | ||
Fady Boctor, the President and Chief Commercial Officer | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of options granted | 215,669 | ||
Exercise price | $ 3.74 | ||
Vesting percentage | 50.00% |
Stock Options and Restricted _7
Stock Options and Restricted Stock Units (''RSU's'') - Additional Information (Details) | May 11, 2021$ / sharesshares | Apr. 23, 2021USD ($)$ / sharesshares | Apr. 08, 2021director$ / sharesshares | Dec. 31, 2021USD ($)director$ / sharesshares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of options granted | 150,000 | 615,669 | ||
Stock issued During period, Value gross | $ | $ 296,000 | |||
Exercise price | $ / shares | $ 3.21 | $ 3.38 | ||
Vesting percentage | 30.00% | |||
Vesting period | 2 years | |||
Stock-based compensation expense recognized | $ | $ 1,305,150 | |||
Restricted Stock Units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of directors to whom option is granted | director | 5 | 5 | ||
Number of options granted | 23,301 | 93,802 | 116,383 | |
Stock issued During period, Value gross | $ | $ 72,000 | |||
Exercise price | $ / shares | $ 3.09 | $ 3.29 | ||
Vesting percentage | 100.00% | |||
Vesting period | 1 year | |||
Option grants | 310,894 | |||
Vesting upon six-month anniversary of the date of grant | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting percentage | 30.00% | |||
Vesting period | 1 year | |||
Directors | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of directors to whom option is granted | director | 5 | |||
Number of options granted | 50,000 | |||
Exercise price | $ / shares | $ 3.18 | |||
Directors | Vesting on the date of grant | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting percentage | 25.00% | |||
Directors | Vesting upon six-month anniversary of the date of grant | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting percentage | 25.00% | |||
Vesting period | 6 months | |||
Directors | Vesting in equal installments over the following four fiscal quarters | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 4 months |
Common Stock Warrants - Summary
Common Stock Warrants - Summary of warrants (Details) - shares | 1 Months Ended | 12 Months Ended |
Dec. 31, 2020 | Dec. 31, 2021 | |
Common Stock Warrants | ||
Warrants outstanding at Beginning Balance | 4,407,962 | |
Warrants issued | 0 | 7,853,558 |
Warrants exercised | 0 | (2,014,586) |
Warrants expired | 0 | (207,913) |
Warrants outstanding at Ending balance | 4,407,962 | 10,039,021 |
Common Stock Warrants - Company
Common Stock Warrants - Company's warrants by expiration date (Details) - $ / shares | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Class of Warrant or Right [Line Items] | |||
Number of Warrants | 10,039,021 | 4,407,962 | 4,407,962 |
Expiration Date of August 23, 2023 | |||
Class of Warrant or Right [Line Items] | |||
Number of Warrants | 2,780 | ||
Exercise Price | $ 1.60 | ||
Expiration Date of June 1, 2024 | |||
Class of Warrant or Right [Line Items] | |||
Number of Warrants | 22,800 | ||
Exercise Price | $ 35.65 | ||
Expiration Date of June 17, 2024 | |||
Class of Warrant or Right [Line Items] | |||
Number of Warrants | 74,864 | ||
Exercise Price | $ 21.85 | ||
Expiration Date of June 19, 2024 | |||
Class of Warrant or Right [Line Items] | |||
Number of Warrants | 20,043 | ||
Exercise Price | $ 31.25 | ||
Expiration Date of September 1, 2024 | |||
Class of Warrant or Right [Line Items] | |||
Number of Warrants | 22,800 | ||
Exercise Price | $ 26.55 | ||
Expiration Date of September 16, 2024 | |||
Class of Warrant or Right [Line Items] | |||
Number of Warrants | 10,500 | ||
Exercise Price | $ 12.738 | ||
Expiration Date of December 1, 2024 | |||
Class of Warrant or Right [Line Items] | |||
Number of Warrants | 22,800 | ||
Exercise Price | $ 4.30 | ||
Expiration Date of March 2, 2025 | |||
Class of Warrant or Right [Line Items] | |||
Number of Warrants | 28,000 | ||
Exercise Price | $ 5.65 | ||
Expiration Date of June 1, 2025 | |||
Class of Warrant or Right [Line Items] | |||
Number of Warrants | 28,000 | ||
Exercise Price | $ 7.30 | ||
Expiration Date of September 1, 2025 | |||
Class of Warrant or Right [Line Items] | |||
Number of Warrants | 28,000 | ||
Exercise Price | $ 5.50 | ||
Expiration Date of September 1, 2025, Two | |||
Class of Warrant or Right [Line Items] | |||
Number of Warrants | 28,000 | ||
Exercise Price | $ 4.705 | ||
Expiration Date of December 1, 2025, One | |||
Class of Warrant or Right [Line Items] | |||
Number of Warrants | 2,221,829 | ||
Exercise Price | $ 7.50 | ||
Expiration Date of December 1, 2025, Two | |||
Class of Warrant or Right [Line Items] | |||
Number of Warrants | 908,498 | ||
Exercise Price | $ 17.50 | ||
Expiration Date of December 1, 2025, Three | |||
Class of Warrant or Right [Line Items] | |||
Number of Warrants | 623,303 | ||
Exercise Price | $ 51.25 | ||
Expiration Date of December 1, 2025, Four | |||
Class of Warrant or Right [Line Items] | |||
Number of Warrants | 157,832 | ||
Exercise Price | $ 125 | ||
Expiration Date of October 18, 2026 | |||
Class of Warrant or Right [Line Items] | |||
Number of Warrants | 1,751,311 | ||
Exercise Price | $ 1.715 | ||
Expiration Date of December 12, 2026 | |||
Class of Warrant or Right [Line Items] | |||
Number of Warrants | 2,337,719 | ||
Exercise Price | $ 3.50 | ||
Expiration Date of December 27, 2026 | |||
Class of Warrant or Right [Line Items] | |||
Number of Warrants | 1,749,942 | ||
Exercise Price | $ 3.50 |
Basic and Diluted Net Loss pe_3
Basic and Diluted Net Loss per Common Share - Summary of Computation of Basic and Diluted Net Loss per Share (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Numerator | ||
Net (loss) income | $ (8,986,676) | $ (20,585,925) |
Weighted average common shares outstanding | ||
Weighted-average common shares for basic net loss per unit | 10,889,766 | 5,340,682 |
Weighted-average common shares for diluted net loss per unit | 10,889,766 | 5,340,682 |
Basic net loss per common share | $ (0.83) | $ (3.85) |
Diluted net loss per common share | $ (0.83) | $ (3.85) |
Basic and Diluted Net Loss pe_4
Basic and Diluted Net Loss per Common Share - Summary of Potentially Dilutive Securities Convertible Into Common Shares Excluded from Calculation of Net Loss Per Share (Details) - shares | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total | 10,771,073 | 4,982,293 |
Stock Option | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total | 615,669 | 574,331 |
RSUs | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total | 116,383 | |
Warrants | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total | 10,039,021 | 4,407,962 |
Marketing, Licensing and Dist_2
Marketing, Licensing and Distribution Agreements - Vivus (Details) | Jan. 18, 2022USD ($) | Sep. 30, 2016USD ($) | Dec. 31, 2021USD ($) | Dec. 31, 2020USD ($) |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Decrease in API purchase commitment | $ 114,997 | |||
API purchase commitment asset | 1,419,538 | $ 1,304,541 | ||
Settlement Agreement | Vivus, Inc | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Inventory amount retained - API | $ 7,300,000 | |||
Amount due under the agreement | 12,400,000 | |||
Amount of forgiveness related to returned goods and minimum purchase commitments | 4,250,000 | |||
Payment made for purchase order | $ 1,542,904 | |||
Percentage of stendra tablets released | 50 | |||
Threshold number of days to release remaining percentage of stendra Tablets upon satisfaction | 180 days | |||
Accrued inventory purchases | 142,000,000 | 14,200,000 | ||
Reserve | 800,000 | |||
Settlement Agreement | Vivus, Inc | Other current assets | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
API purchase commitment asset | 1,400,000 | 1,300,000 | ||
Settlement Agreement | Vivus, Inc | Other noncurrent assets | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Accrued inventory purchases, non-current | 11,000,000 | 11,100,000 | ||
Settlement Agreement | Vivus, Inc | Promissory Note | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Principal amount of notes payable | $ 10,201,758 | |||
Prepayment amount | $ 900,000 | |||
Stated interest rate | 6.00% | |||
Interest rate upon default | 9 | |||
License Agreement | Royalty on the first $500 million of net sales | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Threshold net sales | 500,000,000 | |||
License Agreement | Milestone payment to be paid once $250 million in sales has been reached | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Threshold net sales | 250,000,000 | |||
Milestone payment | 6,000,000 | |||
License Agreement | Milestone payment to be paid after $250 million in sales has been reached | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Threshold net sales | 250,000,000 | |||
Milestone payment | $ 3,200,000 | |||
License Agreement | Vivus, Inc | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
One-time fee to purchase and receive the license for the commercialization and exploitation of Stendra | $ 70,000,000 | |||
License Agreement | Vivus, Inc | Royalty during the first, second, and third years following the expiration of the Royalty Period | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Royalty percentage | 2.00% | |||
License Agreement | Vivus, Inc | Royalty following the fourth and fifth years following the end of the Royalty Period | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Royalty percentage | 1.00% | |||
License Agreement | MTPC | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Royalty incurred | $ 221,211 | 317,875 | ||
Royalty payables | $ 8,728 | |||
Royalty receivable | $ 81,136 | |||
License Agreement | MTPC | Royalty on the first $500 million of net sales | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Royalty percentage | 5.00% | |||
License Agreement | MTPC | Royalty on net sales after $500 million | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Royalty percentage | 6.00% |
Marketing, Licensing and Dist_3
Marketing, Licensing and Distribution Agreements - Hybrid (Details) - Hybrid - USD ($) | Dec. 23, 2021 | Dec. 01, 2021 | Oct. 31, 2021 | Oct. 01, 2021 | Mar. 21, 2021 | Sep. 24, 2020 | Oct. 31, 2020 | Mar. 31, 2020 | Dec. 31, 2020 |
Exclusive license to H100 | |||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||
Initial license fee | $ 100,000 | ||||||||
Additional payment due upon obtainment of orphan indication for H100 | 900,000 | ||||||||
Annual payments due on first anniversary of the license agreement | 125,000 | ||||||||
Annual payments due on second anniversary of the license agreement | 150,000 | ||||||||
Annual payments due on third anniversary of the license agreement | 200,000 | ||||||||
Annual payments due after third anniversary of the license agreement | 250,000 | ||||||||
Payments upon first commercial sale and a sliding scale of percentage payments on net sales | 1,000,000 | ||||||||
Additional payment due upon obtainment of orphan indication for H100 | $ 50,000 | $ 100,000 | $ 100,000 | ||||||
Initial license fee | 6 months | 6 months | |||||||
One-time, non-creditable and non-refundable payment | $ 200,000 | ||||||||
Threshold period for payments of one-time, non-creditable and non-refundable payment | 7 days | ||||||||
Exclusive license to H100 | Minimum | |||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||
Royalty percentage | 3.00% | ||||||||
Exclusive license to H100 | Maximum | |||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||
Royalty percentage | 6.00% | ||||||||
Amended license agreement of H100 | |||||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||||
Payment of License Fees | $ 200,000 | $ 200,000 | $ 200,000 | $ 150,000 |
Commitments and Contingencies_2
Commitments and Contingencies (Details) | 12 Months Ended |
Dec. 31, 2021USD ($) | |
Employee Lease Agreement | |
Commitments And Contingencies [Line Items] | |
Percentage of payments for costs associated with employment | 75.00% |
Amount of fees paid under agreement | $ 200,000 |
Employee Lease Agreement | Maximum | Dr. Charles Ryan | |
Commitments And Contingencies [Line Items] | |
Percentage Of Working Time Performing Services | 75.00% |
Separation Agreement | Mr. Keith Lavan | |
Commitments And Contingencies [Line Items] | |
Stay-on bonus | $ 50,000 |
Percentage of base salary to be paid as an advisor | 50.00% |
Percentage of fees as an advisor paid | 70.00% |
Percentage of fees as an advisor to be paid in equal installments | 30.00% |
Commitments and Contingencies -
Commitments and Contingencies - Operating Leases (Details) | Dec. 31, 2021 |
Minimum | |
Lessee, Lease, Description [Line Items] | |
Remaining lease terms | 2 years 8 months 12 days |
Maximum | |
Lessee, Lease, Description [Line Items] | |
Remaining lease terms | 5 years |
Commitments and Contingencies_3
Commitments and Contingencies - Lease expense (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Operating Lease Cost: | ||
Fixed lease cost | $ 179,246 | $ 179,246 |
Commitments and Contingencies_4
Commitments and Contingencies - Supplemental balance sheet (Details) - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Supplemental balance sheet information related to leases | ||
Operating lease ROU asset: Other assets | $ 475,557 | $ 579,535 |
Operating lease ROU asset | Other assets | Other assets |
Operating lease liability: | ||
Operating lease liability, current | $ 125,579 | $ 108,971 |
Other current liabilities | Other current liabilities | Other current liabilities |
Operating lease liability, noncurrent | $ 405,018 | $ 530,597 |
Other long-term liabilities | Other long-term liabilities | Other long-term liabilities |
Total operating lease liability | $ 530,597 | $ 639,568 |
Commitments and Contingencies_5
Commitments and Contingencies - Lease term and discount (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Commitments and Contingencies | ||
Weighted-average remaining lease terms - operating leases | 3 years 8 months 8 days | 4 years 8 months 12 days |
Weighted-average discount rate - operating leases | 12.60% | 12.60% |
Cash paid for amounts included in the measurement of lease liabilities: | ||
Operating cash flows from operating leases | $ 184,239 | $ 182,639 |
Commitments and Contingencies_6
Commitments and Contingencies - Minimum lease payments (Details) - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Future minimum lease payments under non-cancelable leases | ||
2022 | $ 187,739 | |
2023 | 189,374 | |
2024 | 155,242 | |
2025 | 81,107 | |
2026 | 82,324 | |
Total lease payments | 695,787 | |
Less: Imputed Interest | (165,190) | |
Total operating lease liability | $ 530,597 | $ 639,568 |
Commitments and Contingencies_7
Commitments and Contingencies - Additional information (Details) - USD ($) | 1 Months Ended | |
Nov. 30, 2021 | Dec. 31, 2021 | |
Commitments and Contingencies | ||
Operating leases that had not yet commenced | $ 0 | |
Security deposit received for sublease | $ 14,000 | |
Operating lease expense per month | $ 7,000 |
Income Taxes - Current and defe
Income Taxes - Current and deferred income tax expense (benefit) (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Current expense (benefit): | ||
Federal | $ 0 | $ 5,085 |
State | 0 | 88 |
Total current expense (benefit) | 0 | 5,173 |
Deferred expense (benefit): | ||
Federal | 0 | (1,378,731) |
State | 0 | (53,435) |
Total deferred expense (benefit) | 0 | (1,432,166) |
Income Tax Expense (Benefit), Total | $ 0 | $ (1,426,993) |
Income Taxes - Reconciliation (
Income Taxes - Reconciliation (Details) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Reconciliation of the Company's statutory income tax rate to the Company's effective income tax rate | ||
Income at US statutory rate | 21.00% | 21.00% |
State taxes, net of federal benefit | (0.61%) | 1.56% |
Permanent differences | 22.31% | (2.68%) |
Recapitalization | 0.00% | 36.49% |
Pass through income to members | 0.00% | (32.71%) |
Book income return to provision | 7.43 | 0 |
Valuation allowance | (55.55%) | (17.22%) |
Adjustment to opening deferrals - short period | 5.42 | 0 |
Effective income tax rate | 0.00% | 6.44% |
Income Taxes - Deferred tax ass
Income Taxes - Deferred tax assets and liabilities (Details) - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Significant components of the Company's deferred tax assets and liabilities | ||
Accruals | $ 186,739 | $ 90,222 |
Intangible assets | (1,006,954) | (1,238,128) |
Depreciation and amortization | 5,669,065 | 5,661,235 |
Expenses no currently deductible | 815,108 | 148,708 |
Net operating loss carryforwards | 3,702,789 | 57,266 |
Interest expense limitation | 96,920 | 25,547 |
Stock-based compensation | 2,716,370 | 2,505,425 |
Valuation allowance | $ (12,180,037) | $ (7,250,275) |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Significant Change in Unrecognized Tax Benefits is Reasonably Possible [Line Items] | ||
Cumulative valuation allowance | $ 12,180,037 | $ 7,250,275 |
NOLs | $ 17,400,000 | |
Percentage of future utilization of the NOLs | 80.00% | |
Accrued interest or penalties | $ 0 | |
Maximum | ||
Significant Change in Unrecognized Tax Benefits is Reasonably Possible [Line Items] | ||
Statue of limitations period | 5 years | |
Minimum | ||
Significant Change in Unrecognized Tax Benefits is Reasonably Possible [Line Items] | ||
Statue of limitations period | 3 years |
Defined Contribution Plan (Deta
Defined Contribution Plan (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Defined Contribution Plan | ||
Employer matching contribution | 100.00% | |
Employer's contribution as a percentage of employee's gross pay | 6.00% | |
Employer contributions | $ 57,543 | $ 116,364 |
Segment Information (Details)
Segment Information (Details) | 12 Months Ended | |
Dec. 31, 2021USD ($)segment | Dec. 31, 2020USD ($) | |
Segment Reporting Information [Line Items] | ||
Number of operating segments | segment | 2 | |
Results of operations by reportable segment | ||
Net sales | $ 7,811,264 | $ 9,559,469 |
Cost of goods sold | 1,599,566 | 4,046,466 |
Selling, general and administrative expenses | 15,593,233 | 15,674,968 |
Research and development expenses | 1,788,491 | 459,636 |
Depreciation and amortization expense | 6,877,990 | 6,660,438 |
Change in fair value of derivative liability | (9,430,000) | 1,680,000 |
Debt, interest expense | 368,660 | 3,050,879 |
Income tax expense | 0 | 1,426,993 |
Net loss | $ (8,986,676) | (20,585,925) |
Operating segments | ||
Segment Reporting Information [Line Items] | ||
Number of operating segments | segment | 2 | |
Corporate | ||
Results of operations by reportable segment | ||
Selling, general and administrative expenses | $ 6,499,348 | 4,865,804 |
Change in fair value of derivative liability | (9,430,000) | 1,680,000 |
Debt, interest expense | 368,660 | 3,050,879 |
Net loss | 2,561,992 | (9,596,683) |
Prescription Medication Sales | ||
Results of operations by reportable segment | ||
Net sales | 4,605,043 | 6,357,498 |
Cost of goods sold | 577,795 | 3,083,417 |
Selling, general and administrative expenses | 6,473,482 | 8,784,716 |
Research and development expenses | 1,788,491 | 459,636 |
Depreciation and amortization expense | 5,564,499 | 5,424,292 |
Net loss | (9,799,224) | (11,394,563) |
Medical Device Sales | ||
Results of operations by reportable segment | ||
Net sales | 3,206,221 | 3,201,971 |
Cost of goods sold | 1,021,771 | 963,049 |
Selling, general and administrative expenses | 2,620,403 | 2,024,448 |
Depreciation and amortization expense | 1,313,491 | 1,236,146 |
Income tax expense | 1,426,993 | |
Net loss | $ (1,749,444) | $ (405,321) |
Segment Information - Net Sales
Segment Information - Net Sales by Geographic region (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net sales | $ 7,811,264 | $ 9,559,469 |
United States | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net sales | 6,572,849 | 8,555,831 |
International | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net sales | $ 1,238,415 | $ 1,003,638 |
Segment Information - Segment a
Segment Information - Segment assets (Details) - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Intangible assets, net | $ 25,293,149 | $ 32,160,919 |
Total segment assets | 67,390,058 | 69,854,014 |
Prescription Medication Sales | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Intangible assets, net | 19,071,407 | 24,625,686 |
Total segment assets | 59,657,514 | 60,725,191 |
Medical Device Sales | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Intangible assets, net | 6,221,742 | 7,535,233 |
Total segment assets | $ 7,732,544 | $ 9,128,823 |