Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2019 | May 01, 2019 | |
Document And Entity Information | ||
Entity Registrant Name | VBI Vaccines Inc/BC | |
Entity Central Index Key | 0000764195 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2019 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business Flag | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | true | |
Entity Common Stock, Shares Outstanding | 97,661,887 | |
Trading Symbol | VBIV | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2019 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
CURRENT ASSETS | ||
Cash | $ 43,308 | $ 59,270 |
Accounts receivable, net | 117 | 56 |
Inventory, net | 1,083 | 911 |
Prepaid expenses | 708 | 982 |
Other current assets | 580 | 512 |
Total current assets | 45,796 | 61,731 |
NON-CURRENT ASSETS | ||
Other long-term assets | 881 | 835 |
Property and equipment, net | 9,944 | 8,525 |
Right of use assets | 1,719 | |
Intangible assets, net | 59,465 | 58,249 |
Goodwill | 8,438 | 8,265 |
Total non-current assets | 80,447 | 75,874 |
TOTAL ASSETS | 126,243 | 137,605 |
CURRENT LIABILITIES | ||
Accounts payable | 5,654 | 6,055 |
Other current liabilities | 12,552 | 13,847 |
Current portion of deferred revenues | 2,333 | 2,375 |
Current portion of lease liability | 795 | |
Current portion of long-term debt, net of debt discount - related party | 1,659 | 1,100 |
Total current liabilities | 22,993 | 23,377 |
NON-CURRENT LIABILITIES | ||
Lease liability, net of current portion | 924 | |
Long-term debt, net of debt discount - related party | 12,443 | 12,927 |
Liabilities for severance pay | 429 | 371 |
Deferred revenues, net of current portion | 2,759 | 2,797 |
Total non-current liabilities | 16,555 | 16,095 |
COMMITMENTS AND CONTINGENCIES (NOTE 12) | ||
STOCKHOLDERS' EQUITY | ||
Common shares (unlimited authorized; no par value) (2019 - issued and outstanding 97,661,887; 2018 - issued and outstanding 97,343,777) | 246,848 | 246,417 |
Additional paid-in capital | 64,459 | 63,449 |
Accumulated other comprehensive loss | (2,431) | (4,158) |
Accumulated deficit | (222,181) | (207,575) |
Total stockholders' equity | 86,695 | 98,133 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 126,243 | $ 137,605 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | 3 Months Ended | 12 Months Ended |
Mar. 31, 2019 | Dec. 31, 2018 | |
Statement of Financial Position [Abstract] | ||
Common stock, authorized unlimited | Unlimited | Unlimited |
Common stock, no par value | ||
Common stock, shares issued | 97,661,887 | 97,343,777 |
Common stock, shares outstanding | 97,661,887 | 97,343,777 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Income Statement [Abstract] | ||
Revenues | $ 360 | $ 178 |
Operating expenses: | ||
Cost of revenue | 988 | 1,413 |
Research and development | 9,227 | 6,964 |
General and administrative | 3,964 | 3,425 |
Total operating expenses | 14,179 | 11,802 |
Loss from operations | (13,819) | (11,624) |
Interest expense, net of interest income (including related party - see Note 8) | (480) | (539) |
Foreign exchange loss | (307) | (88) |
Loss before income taxes | (14,606) | (12,251) |
Income tax expense | ||
NET LOSS | $ (14,606) | $ (12,251) |
Net loss per share of common shares, basic and diluted | $ (0.15) | $ (0.19) |
Weighted-average number of common shares outstanding, basic and diluted | 97,481,625 | 64,179,605 |
Other comprehensive (loss) income - currency translation adjustments | $ 1,727 | $ (1,902) |
COMPREHENSIVE LOSS | $ (12,879) | $ (14,153) |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) $ in Thousands | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Other Comprehensive Income (Loss) - Currency Translation Adjustments [Member] | Accumulated Deficit [Member] | Total |
Balance at Dec. 31, 2017 | $ 201,806 | $ 60,891 | $ 1,065 | $ (143,975) | $ 119,787 |
Balance, shares at Dec. 31, 2017 | 64,078,781 | ||||
Stock-based compensation | $ 88 | 734 | 822 | ||
Stock-based compensation, shares | 135,000 | ||||
Warrant modification in connection with debt amendment | |||||
Common shares issued on exercise of stock options | $ 5 | 5 | |||
Common shares issued on exercise of stock options, shares | 1,946 | ||||
Net loss | (12,251) | (12,251) | |||
Currency translation adjustments | (1,902) | (1,902) | |||
Balance at Mar. 31, 2018 | $ 201,899 | 61,625 | (837) | (156,226) | 106,461 |
Balance, Shares at Mar. 31, 2018 | 64,215,727 | ||||
Balance at Dec. 31, 2018 | $ 246,417 | 63,449 | (4,158) | (207,575) | 98,133 |
Balance, shares at Dec. 31, 2018 | 97,343,777 | ||||
Stock-based compensation | $ 431 | 831 | 1,262 | ||
Stock-based compensation, shares | 318,110 | ||||
Warrant modification in connection with debt amendment | 179 | 179 | |||
Net loss | (14,606) | (14,606) | |||
Currency translation adjustments | 1,727 | 1,727 | |||
Balance at Mar. 31, 2019 | $ 246,848 | $ 64,459 | $ (2,431) | $ (222,181) | $ 86,695 |
Balance, Shares at Mar. 31, 2019 | 97,661,887 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net loss | $ (14,606) | $ (12,251) |
Adjustments to reconcile net loss to cash used in operating activities: | ||
Depreciation and amortization | 124 | 149 |
Stock-based compensation | 1,262 | 822 |
Amortization of debt discount | 255 | 299 |
Net change in operating working capital items: | ||
Increase in accounts receivable | (59) | (27) |
(Increase) decrease in inventory | (143) | 1 |
Decrease in prepaid expenses | 327 | 54 |
Increase in other current assets | (84) | (106) |
Decrease (increase) in other long-term assets | 4 | (21) |
Decrease in operating right of use assets | 245 | |
(Decrease) increase in accounts payable | (1,089) | 614 |
(Decrease) increase in deferred revenues | (284) | 84 |
Increase in other current liabilities | 273 | 1,804 |
Payments made on operating lease liabilities | (245) | |
Net cash flows used in operating activities | (14,020) | (8,578) |
INVESTING ACTIVITIES | ||
Purchase of property and equipment | (1,896) | (1,015) |
Net cash flows used in investing activities | (1,896) | (1,015) |
FINANCING ACTIVITIES | ||
Proceeds from issuance of common shares for cash, upon exercise of stock options | 5 | |
Net cash flows provided by financing activities | 5 | |
Effect of exchange rates on cash | (46) | (12) |
CHANGE IN CASH FOR THE PERIOD | (15,962) | (9,600) |
CASH, BEGINNING OF PERIOD | 59,270 | 67,694 |
CASH, END OF PERIOD | 43,308 | 58,094 |
Supplementary information: | ||
Interest paid - related party | 518 | 474 |
Non-cash investing and financing activities: | ||
Warrant modification in connection with debt amendment | 179 | |
Capital expenditures included in accounts payable and other current liabilities | $ 958 |
Nature of Business and Continua
Nature of Business and Continuation of Business | 3 Months Ended |
Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of Business and Continuation of Business | 1. NATURE OF BUSINESS AND CONTINUATION OF BUSINESS Corporate Overview VBI Vaccines Inc. (the “Company” or “VBI”) was incorporated under the laws of British Columbia, Canada on April 9, 1965. The Company and its wholly-owned subsidiaries, VBI Vaccines (Delaware) Inc., a Delaware corporation (“VBI DE”); VBI DE’s wholly-owned subsidiary, Variation Biotechnologies (US), Inc., a Delaware corporation (“VBI US”); Variation Biotechnologies Inc. a Canadian company and the wholly-owned subsidiary of VBI US (“VBI Cda”); SciVac Ltd. an Israeli company (“SciVac”) and SciVac Hong Kong Limited (“SciVac HK”) are collectively referred to as the “Company”, “we”, “us”, “our” or “VBI”. The Company’s registered office is located at Suite 1700, Park Place, 666 Burrard Street, Vancouver, BC V6C 2X8 with its principal office located at 222 Third Street, Suite 2241, Cambridge, MA 02142. In addition, the Company has manufacturing facilities located in Rehovot, Israel and research facilities located in Ottawa, Ontario, Canada. Principal Operations VBI is a commercial-stage, biopharmaceutical company developing next generation vaccines to address unmet needs in infectious disease and immuno-oncology. We currently manufacture our product, Sci-B-Vac a third generation prophylactic Hepatitis B vaccine for adults, children and newborns, which is approved for use in Israel and 10 other countries. Sci-B-Vac has not yet been approved by the United States Food and Drug Administration (the “FDA”), the European Medicines Agency (the “EMA”) or Health Canada. VBI is currently conducting a global Phase III clinical program to obtain FDA, EMA and Health Canada market approvals for commercial sale of Sci-B-Vac in the United States, Europe, and Canada, respectively. Our wholly-owned subsidiary in Rehovot, Israel, currently manufactures and sells Sci-B-Vac. We are also developing a protein-based immunotherapeutic for treatment of Hepatitis B in collaboration with Brii Biosciences Limited (“Brii Bio”). We are also developing a pipeline of products that target unmet medical needs in infectious disease and oncology. These programs are developed using VBI’s proprietary technology, the enveloped “Virus Like Particle” or “eVLP” vaccine platform, that allows for the design of enveloped virus-like particle vaccines that closely mimic the target viruses. VBI’s lead eVLP programs are targeting human cytomegalovirus (“CMV”), an infection that can lead to serious complications in; newborns, solid organ transplant recipients, people with weakened immune systems, and is present in glioblastoma (“GBM”), an aggressive form of adult brain cancer. Liquidity and Going Concern The Company has a limited operating history and faces a number of risks, including but not limited to, uncertainties regarding the success of the development and commercialization of its products, demand and market acceptance of the Company’s products and reliance on major customers. The Company anticipates that it will continue to incur significant operating costs and losses in connection with the development of its products. The Company has an accumulated deficit of $222,181 as of March 31, 2019 and cash outflows from operating activities of $14,020 for the three months ended March 31, 2019. The Company will require significant additional funds to conduct clinical and non-clinical trials, achieve regulatory approvals, and, subject to such approvals, commercially launch its products. The Company plans to finance future operations with existing cash reserves. Additional financing, if required, will be a combination of proceeds from the issuance of equity securities, the issuance of additional debt, structured asset financings, and revenues from potential collaborations, if any. There is no assurance the Company will manage to obtain these sources of financing, if required. The above conditions raise substantial doubt about the Company’s ability to continue as a going concern. The consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result should the Company be unable to continue as a going concern. Financial instruments recognized in the condensed consolidated balance sheet consist of cash, accounts receivable, other current assets, accounts payable and other current liabilities. The Company believes that the carrying value of its current financial instruments approximates their fair values due to the short-term nature of these instruments. The Company does not hold any derivative financial instruments. The carrying amounts of the Company’s long-term assets approximate their respective fair values. |
Significant Accounting Policies
Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | 2. SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation and Consolidation The Company’s fiscal year ends on December 31 of each calendar year. The accompanying unaudited condensed consolidated financial statements have been prepared in U.S. dollars (“USD”) and pursuant to the rules and regulations of the United States Securities and Exchange Commission (“SEC”), for interim reporting. Accordingly, certain information and footnote disclosures normally included in the financial statements prepared in accordance with United States of America generally accepted accounting principles (“U.S. GAAP”), have been condensed or omitted pursuant to such rules and regulations. The December 31, 2018 consolidated balance sheet in this document was derived from the audited consolidated financial statements. The condensed consolidated financial statements and notes included in this quarterly report on Form 10-Q (this “Form 10-Q”) does not include all of the disclosures required by U.S. GAAP and should be read in conjunction with the financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018 (the “2018 10-K”), as filed with the SEC on February 25, 2019. The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries: SciVac, VBI DE, VBI US, VBI Cda and SciVac HK. Intercompany balances and transactions between the Company and its subsidiaries are eliminated in the condensed consolidated financial statements. In the opinion of management, these condensed consolidated financial statements include all adjustments and accruals of a normal and recurring nature necessary to fairly state the results of the periods presented. The results for the periods presented are not necessarily indicative of results to be expected for the full year or for any future periods. Significant Accounting Policies The significant accounting policies used in the preparation of these condensed consolidated financial statements are disclosed in the 2018 10-K, and there have been no changes to the Company’s significant accounting policies during the three months ended March 31, 2019, other than accounting for leases discussed below. Leases The Company determines if an arrangement is a lease at inception. For the Company’s operating leases, the right-of-use (“ROU”) assets represents the Company’s right to use an underlying asset for the lease term and operating lease liabilities represent an obligation to make lease payments arising from the lease. ROU assets and lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. Since the lease agreements do not provide an implicit rate, the Company estimated an incremental borrowing rate in determining the present value of the lease payments. Operating lease expense is recognized on a straight-line basis over the lease term, subject to any changes in the lease or expectations regarding the terms. Variable lease costs such as operating costs and property taxes are expensed as incurred. See also Note 3. |
New Accounting Pronouncements
New Accounting Pronouncements | 3 Months Ended |
Mar. 31, 2019 | |
Accounting Changes and Error Corrections [Abstract] | |
New Accounting Pronouncements | 3. NEW ACCOUNTING PRONOUNCEMENTS Recently Adopted Accounting Pronouncements Leases In February 2016, the FASB issued Accounting Standards Update No. 2016-02, Leases (Topic 842) (“ASU 2016-02”), which sets out the principles for the recognition, measurement, presentation and disclosure of leases for both lessees and lessors. On January 1, 2019, the Company adopted the new lease standard using the optional transition method under which comparative financial information will not be restated and continue to apply the provisions of the previous lease standard in its annual disclosures for the comparative periods. In addition, the new lease standard provides a number of optional practical expedients in transition. The Company elected the package of practical expedients. As such, the Company did not have to reassess whether expired or existing contracts are or contain a lease; did not have to reasses the lease classifications or reasses the initial direct costs associated with expired or existing leases. The new lease standard also provides practical expedients for an entity’s ongoing accounting. The Company elected the short-term lease recognition exemption under which the Company will not recognize ROU assets or lease liabilities, and this includes not recognizing ROU assets or lease liabilities for existing short-term leases. The Company elected the practical expedient to not separate lease and non-lease components. On January 1, 2019, the Company recognized ROU assets and lease liabilities of $1,653 on its consolidated balance sheet. Compensation – Stock Compensation In June 2018, the FASB issued ASU 2018-07: Compensation – Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting. This ASU expands the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from non-employees, and as a result, the accounting for share-based payments to non-employees will be substantially aligned. ASU 2018-07 is effective for fiscal years beginning after December 15, 2018, including interim periods within that fiscal year, early adoption is permitted but no earlier than an entity’s adoption date of Topic 606. Our adoption of this ASU, effective January 1, 2019, did not have a material impact on our condensed consolidated financial statements and footnote disclosures. Recently Issued Accounting Standards, not yet Adopted Intangibles – Goodwill and Other, Internal-Use Software In August 2018, the FASB issued ASU 2018-15: Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40): Customers’ accounting for implementation costs incurred in a cloud computing arrangement that is a service contract. This ASU aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. Accordingly, the amendments require an entity (customer) in a hosting arrangement that is a service contract to follow the guidance in Subtopic 350-40 to determine which implementation costs to capitalize as an asset related to the service contract and which costs to expense. ASU 2018-15 is effective for fiscal years beginning after December 15, 2019 and interim periods within those fiscal years. Early adoption is permitted. This ASU can be applied either retrospectively or prospectively to all implementation costs incurred after the date of adoption. The Company is currently evaluating the impact this new guidance will have on its condensed consolidated financial statements and related disclosures. |
Inventory, Net
Inventory, Net | 3 Months Ended |
Mar. 31, 2019 | |
Inventory Disclosure [Abstract] | |
Inventory, Net | 4. INVENTORY, NET Inventory is stated at the lower of cost or market and consists of the following: March 31, 2019 December 31, 2018 Finished goods $ 60 $ 81 Work-in-process 67 64 Raw materials 956 766 $ 1,083 $ 911 |
Intangibles and Goodwill
Intangibles and Goodwill | 3 Months Ended |
Mar. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangibles and Goodwill | 5. INTANGIBLES AND GOODWILL March 31, 2019 Gross Carrying Amount Accumulated Amortization Cumulative Impairment Charge Cumulative Currency Translation Net Book Value Patents $ 669 $ (472 ) $ - $ 18 $ 215 IPR&D assets 61,500 - (300 ) (1,950 ) 59,250 $ 62,169 $ (472 ) $ (300 ) $ (1,932 ) $ 59,465 December 31, 2018 Gross Carrying Amount Accumulated Amortization Cumulative Impairment Charge Cumulative Currency Translation Net Book Value Patents $ 669 $ (457 ) $ - $ 11 $ 223 IPR&D assets 61,500 - (300 ) (3,174 ) 58,026 $ 62,169 $ (457 ) $ (300 ) $ (3,163 ) $ 58,249 The Company amortizes intangible assets with finite lives on a straight-line basis over their estimated useful lives. Amortization related to the IPR&D assets will not begin amortizing until the Company commercializes its products. The change in carrying value for IPR&D assets from December 31, 2018 relates to currency translation adjustments which decreased by $1,217 for the three-month period ended March 31, 2019. The goodwill is in VBI Cda and the change in carrying value from December 31, 2018 relates to currency translation adjustments which decreased goodwill by $173 for the three-month period ended March 31, 2019. |
Other Current Liabilities
Other Current Liabilities | 3 Months Ended |
Mar. 31, 2019 | |
Other Liabilities Disclosure [Abstract] | |
Other Current Liabilities | 6. OTHER CURRENT LIABILITIES Other current liabilities consisted of the following: March 31, 2019 December 31, 2018 Accrued research and development expenses (including clinical trial accrued expenses) $ 10,122 $ 9,763 Payroll and employee-related costs 1,179 2,294 Other current liabilities 1,251 1,790 $ 12,552 $ 13,847 |
Loss Per Share of Common Shares
Loss Per Share of Common Shares | 3 Months Ended |
Mar. 31, 2019 | |
Earnings Per Share [Abstract] | |
Loss Per Share of Common Shares | 7. LOSS PER SHARE OF COMMON SHARES Basic loss per share is computed by dividing net loss applicable to common stockholders by the weighted average number of common shares outstanding during each period. Diluted loss per share includes the effect, if any, from the potential exercise or conversion of securities, such as warrants, and stock options, which would result in the issuance of incremental shares of common shares unless such effect is anti-dilutive. In computing the basic and diluted net loss per share applicable to common stockholders, the weighted average number of shares remains the same for both calculations due to the fact that when a net loss exists, dilutive shares are not included in the calculation as their effect would be anti-dilutive. These potentially dilutive securities are more fully described in Note 9, Stockholders’ Equity and Additional Paid-in Capital. The following potentially dilutive securities outstanding at March 31, 2019 and 2018 have been excluded from the computation of diluted weighted average shares outstanding, as they would be antidilutive: March 31, 2019 March 31, 2018 Warrants 2,618,824 2,618,824 Stock options and equity awards 7,377,995 3,960,549 9,996,819 6,579,373 |
Long-Term Debt - Related Party
Long-Term Debt - Related Party | 3 Months Ended |
Mar. 31, 2019 | |
Debt Disclosure [Abstract] | |
Long-Term Debt - Related Party | 8. LONG-TERM DEBT – RELATED PARTY As at March 31, 2019 and the December 31, 2018, the long-term debt is as follows: March 31, 2019 December 31, 2018 Long-term debt, net of debt discount of $1,198 $ 14,102 $ 14,027 Less: current portion, net of debt discount of $141 (1,659 ) (1,100 ) $ 12,443 $ 12,927 On May 6, 2016, the Company through VBI US assumed a term loan facility with Perceptive Credit Holdings, LP, a related party, (the “Lender”) in the amount of $6,000 (the “Facility”). On December 6, 2016, the Company amended the Facility (the “Amended Credit Facility”) and raised the Lender’s commitment amount to $13,200, which was combined with the remaining balance from the Facility of $1,800. On July 17, 2018, the Company amended the Amended Credit Facility (the “Second Amendment”) to extend the period the Company is required to pay only the interest on the loan from May 31, 2018 to December 31, 2018 and to extend the expiration date of certain warrants to purchase 363,771 common shares issued to the Lender with an original expiration date of July 25, 2019 to December 6, 2021. The Company accounted for this as a debt modification, and as a result of the extension of the warrant expiration date in connection with the Second Amended Facility, the debt discount was increased by $386. This amount represents the incremental fair value of the modified warrants. On January 31, 2019, the Company further amended the Amended Credit Facility (the “Third Amendment”) to i) extend the period the Company is required to pay only the interest on the loan from December 31, 2018 to the Amortization Commencement Date (which is defined as the later of July 31, 2019 and, if Sci-B-Vac Phase III clinical trial endpoints are achieved by June 30, 2019, January 31, 2020), ii) extend the maturity of the term loan to June 30, 2020 and iii) reduce the exercise price on certain warrants to purchase common shares issued to the Lender to $2.75 from $4.13 for 363,771 warrants issued on July 25, 2014 and for 363,771 warrants issued on December 6, 2016 and from $3.355 for 1,341,282 warrants issued on December 6, 2016. The Company has accounted for this as a debt modification, and as result of the amendment to the exercise price in connection with the Third Amendment, the debt discount was increased by $179. This amount represents the incremental fair value of the modified warrants. The total principal amount of the loan under the Amended Credit Facility outstanding at March 31, 2019, including the $300 exit fee discussed below, is $15,300. The principal amount of the loan made under the Amended Credit Facility accrues interest at an annual rate equal to the greater of (a) one-month LIBOR (subject to a 5.00% cap) or (b) 1.00%, plus the Applicable Margin. The Applicable Margin will be 11.00%. The Company was required to only pay interest initially until May 31, 2018, which date was extended to December 31, 2018, pursuant to the Second Amendment and further extended to the Amortization Commencement Date pursuant to the Third Amendment. The interest rate as of March 31, 2019 was 13.50%. Upon the occurrence of an Event of Default (as defined in the Amended Credit Facility), and during the continuance of an event of default, the Applicable Margin, defined above, will be increased by 4.00% per annum. This term loan facility maturity date has been extended from December 6, 2019 to June 30, 2020 and includes both financial and non-financial covenants, including a minimum cash balance requirement. The Company was in compliance with these covenants as of March 31, 2019. Pursuant to the Amended Credit Facility, the Company agreed that the Lender shall designate an individual who would be appointed to the Company’s board of directors (the “Board”). The Lender’s designee was also a portfolio manager of the Company’s largest shareholder. Effective January 2018, the Lender’s designee resigned from our Board. The Company’s obligations under the Amended Credit Facility are secured on a senior basis by a lien on substantially all of the assets of the Company and its subsidiaries and are guaranteed by the Company and its subsidiaries. The Amended Credit Facility also contains customary events of default. The total debt discount of $4,018 is being charged to interest expense using the effective interest method over the term of the debt. As of March 31, 2019, and December 31, 2018, the unamortized debt discount is $1,198 and $1,274, respectively. At March 31, 2019 and December 31, 2018, the fair value of our outstanding debt, which is considered level 3 in the fair value hierarchy, is estimated to be approximately $15,354 and $14,975, respectively. Interest expense, net of interest income recorded in the three months ended March 31, 2019 and 2018 was as follows: Three months ended March 31 2019 2018 Interest expense – related party $ 518 $ 474 Amortization of debt discount – related party 255 299 Interest income (293 ) (234 ) Total interest expense, net of interest income $ 480 $ 539 The following table summarizes the future principal payments due under long-term debt: Principal payments on Third Amendment and exit fee Remaining 2019 $ 1,200 2020 14,100 $ 15,300 |
Stockholders' Equity and Additi
Stockholders' Equity and Additional Paid-In Capital | 3 Months Ended |
Mar. 31, 2019 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity and Additional Paid-In Capital | 9. STOCKHOLDERS’ EQUITY AND ADDITIONAL PAID-IN CAPITAL Stock option plans The Company’s stock option plans are approved by and administered by the Company’s Board and its Compensation Committee. The Board designates, in connection with recommendations from the Compensation Committee, eligible participants to be included under the plan, and designates the number of options, exercise price and vesting period of the new options. 2006 VBI US Stock Option Plan No further options will be issued under the 2006 VBI US Stock Option Plan (the “2006 Plan”). As at March 31, 2019, there were 1,112,696 options outstanding under the 2006 Plan. 2013 Equity Incentive Plan No further options will be issued under the 2013 Equity Incentive Plan (the “2013 Plan”). As at March 31, 2019, there were 3,460 options outstanding under the 2013 Plan. 2014 Equity Incentive Plan No further options will be issued under the 2014 Equity Incentive Plan (the “2014 Plan”). As at March 31, 2019, there were 604,474 options outstanding under the 2014 Plan. 2016 VBI Incentive Plan The 2016 VBI Equity Incentive Plan (the “2016 Plan”) is a rolling incentive plan that sets the number of common shares issuable under the 2016 Plan, together with any other security-based compensation arrangement of the Company, at a maximum of 10% of the aggregate common shares issued and outstanding on a non-diluted basis at the time of any grant under the 2016 Plan. The 10% maximum is inclusive of options granted under all equity incentive plans. The 2016 Plan is an omnibus equity incentive plan pursuant to which the Company may grant equity and equity-linked awards to eligible participants in order to promote the success of the Company by providing a means to offer incentives and to attract, motivate, retain and reward persons eligible to participate in the 2016 Plan. Grants under the 2016 Plan include a grant or right consisting of one or more options, stock appreciation rights (“SARs”), restricted share units (“RSUs”), performance share units (“PSUs”), shares of restricted stock or other such award as may be permitted under the 2016 Plan. As at March 31, 2019, there were 5,277,962 options and 379,403 stock awards outstanding under the 2016 Plan. The aggregate number of common shares remaining available for issuance for awards under the 2016 Plan total 1,396,061 at March 31, 2019. Activity related to stock options is as follows: Number of Stock Options Weighted Average Exercise Price Balance outstanding at December 31, 2018 3,479,676 $ 4.14 Granted 3,570,000 $ 1.66 Forfeited (51,084 ) 4.62 Balance outstanding at March 31, 2019 6,998,592 $ 2.88 Exercisable at March 31, 2019 2,575,244 $ 4.16 Information relating to RSUs is as follow: Number of Stock Awards Weighted Average Fair Value at Grant Date Unvested shares outstanding at December 31, 2018 268,570 $ 4.13 Granted 330,000 $ 1.65 Vested (219,167 ) $ 1.97 Unvested shares outstanding at March 31, 2019 379,403 $ 3.22 In determining the amount of stock-based compensation the Company used the Black-Scholes option pricing model to establish the fair value of options granted by applying the following weighted average assumptions: 2019 2018 Volatility 118.12 % 114.53 % Risk free interest rate 2.46 % 2.48 % Expected term in years 5.77 5.77 Expected dividend yield 0.00 % 0.00 % Weighted average fair value per option $ 1.43 $ 3.53 The fair value of the options is recognized as an expense on a straight-line basis over the vesting period and forfeitures are accounted for when they occur. The total stock-based compensation expense recorded in the three months ended March 31, 2019 and 2018 was as follows: Three months ended March 31 2019 2018 Research and development $ 228 $ 191 General and administrative 1,017 618 Cost of revenues 17 13 Total stock-based compensation expense $ 1,262 $ 822 |
Revenues and Deferred Revenue
Revenues and Deferred Revenue | 3 Months Ended |
Mar. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Revenues and Deferred Revenue | 10. REVENUES AND DEFERRED REVENUE Revenue is comprised of the following: March 31, 2019 March 31, 2018 Product revenues $ 93 $ 164 R&D service revenues 267 14 $ 360 $ 178 The following table presents revenues expected to be recognized in the future related to performance obligations, based on current estimates, that are unsatisfied at March 31, 2019: Total Remaining 2019 2020 and thereafter Product revenues $ 469 $ - $ 469 R&D service revenues 4,623 2,333 2,290 Total $ 5,092 $ 2,333 $ 2,759 The following table presents changes in the deferred revenue balance for the year ended December 31, 2018: Balance at December 31, 2018 $ 5,172 Recognition of deferred revenue (261 ) Currency translation 181 Balance at March 31, 2019 $ 5,092 Short Term $ 2,333 Long Term $ 2,759 Collaboration and License Agreement – Brii Bio On December 4, 2018, we entered into a License Agreement with Brii Bio, whereby: ● the Company and Brii Bio agreed to collaborate on the development of a hepatitis B recombinant protein-based immunotherapeutic in the licensed territory, which consists of China, Hong Kong, Taiwan and Macau (collectively, the “Licensed Territory”), and to conduct a Phase II collaboration clinical trial for the purpose of comparing VBI-2601, which is a recombinant protein-based immunotherapeutic developed by VBI for use in treating chronic hepatitis B, with a novel composition developed jointly with Brii Bio (either being the “Licensed Product”); and ● The Company granted Brii Bio an exclusive royalty-bearing license to perform studies, and regulatory and other activities, as may be required to obtain and maintain marketing approval of the Licensed Product, for the treatment of hepatitis B in the Licensed Territory and to commercialize the Licensed Product for the diagnosis and treatment of chronic hepatitis B in the Licensed Territory Pursuant to the Collaboration and License Agreement, the Company is responsible for the R&D services and Brii Bio is responsible for costs relating to the clinical trials for the Licensed Territory. The initial consideration of the Collaboration and License Agreement consisted of a $11 million non-refundable upfront payment. As part of Collaboration and Licences Agreement, the Company and Brii Bio entered into a stock purchase agreement. Under the terms of the stock purchase agreement, the Company issued to Brii Bio 2,295,082 shares of its common stock valued at $3.6 million (based on the Company’s common stock price on December 4, 2018). The remaining $7.4 million, deemed to be the initial transaction price, was allocated to two performance obligations: i) the VBI-2601 license and ii) R&D services. The R&D services were allocated $4.8 million of the transaction price using an estimated selling price based on a expected cost plus a margin approach and the remaining transaction price of $2.6 million was allocated to the VBI-2601 license using the residual method. In addition, the Company is also eligible to receive an additional $117.5 million in potential regulatory and sales milestone payments, along with royalties on commercial sales in the licensed territory. Milestone payments that are not within the control of the Company or the licensee, such as regulatory approvals, are not considered probable of being achieved until those approvals are received. Therefore, no variable consideration was included in the initial transaction price and no such amounts have been recognized to date. On December 4, 2018, the Company recognized the VBI-2601 license when it was transferred and Brii Bio is able to use and benefit from the license, as it was determined to be distinct. The R&D Services will be satisfied over time as services are rendered using the “cost-to-cost” input method as this method represents the most accurate depiction of the transfer of services based on the types of costs expected to be incurred. As at March 31, 2019, R&D services that remain unsatisfied are $4.4 million. Upon termination of the License Agreement prior to the end of the term, there is no obligation for refund and any amounts in deferred revenue related to unsatisfied performance obligations will be immediately recognized. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 11. INCOME TAXES The Company operates in U.S., Israel and Canadian tax jurisdictions. Its income is subject to varying rates of tax, and losses incurred in one jurisdiction cannot be used to offset income taxes payable in another. The Company determines its annual effective tax rate at the end of each interim period based on the year to date period results. Since the Company is incorporated in Canada, it is required to use Canada’s statutory tax rate of 26.50% in the determination of the estimated annual effective tax rate. The Company’s effective tax rate on loss before tax for the three months ended March 31, 2019 of 0.00% (0.00% for the three months ended March 31, 2018) differs from the Canadian statutory rate of 26.50% primarily due to recording a valuation allowance on the Canadian deferred tax assets in excess of the remaining Canadian deferred tax liability and the effect of recording a valuation allowance against deferred tax assets in all other jurisdictions. The Company maintains a valuation allowance on all of its deferred tax assets. A valuation allowance is required when, based upon an assessment of various factors, including recent operating loss history, anticipated future earnings, and prudent and reasonable tax planning strategies, it is more likely than not that some portion of the deferred tax assets will not be realized. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 12. COMMITMENTS AND CONTINGENCIES Legal Proceedings From time to time, the Company may be involved in certain claims and litigation arising out of the ordinary course and conduct of business. Management assesses such claims and, if it considers that it is probable that an asset had been impaired or a liability had been incurred and the amount of loss can be reasonably estimated, provisions for loss are made based on management’s assessment of the most likely outcome. On September 13, 2018, two actions were brought in the District Court of the central district in Israel naming our subsidiary SciVac as a defendant. In one claim, two minors, through their parents, allege among other things, defects in certain batches of Sci-B-Vac discovered in July 2015; that Sci-B-Vac was approved for use in children and infants in Israel without sufficient evidence establishing its safety; that SciVac failed to provide accurate information about Sci-B-Vac to consumers and that each child suffered side effects from the vaccine. The claim was filed together with a motion seeking approval of a class action on behalf of 428,000 children vaccinated with Sci-B-Vac in Israel from April, 2011 and seeking damages in a total amount of NIS 1,879,500,000 (not in thousands) ($517,483). The second claim is a civil action brought by two minors and their parents against SciVac and the Israel Ministry of Health alleging, among other things, that SciVac marketed an experimental, defective, hazardous or harmful vaccine; that Sci-B-Vac was marketed in Israel without sufficient evidence establishing its safety; and that Sci-B-Vac was produced and marketed in Israel without approval of a western regulatory body. The claim seeks damages for past and future losses and expenses as well as punitive damages. SciVac believes these matters to be without merit and intends to defend these claims vigorously. The District Court has accepted SciVac’s motion to suspend reaching a decision on the approval of the class action pending the determination of liability under the civil action. The trial of the civil action has been scheduled to begin on September 19, 2019. Operating leases The Company has entered into various non-cancelable lease agreements for its office, lab and manufacturing facilities, which are classified as operating leases. The office facility lease agreement in the United States expires on April 30, 2020, with no option to extend. Our manufacturing facility lease agreement expires on January 31, 2022, which includes one five-year option to extend until January 31, 2027. The lease agreement for our research facility in Canada, which comprises of office and laboratory space, expires on December 31, 2019 with the option to extend the term for two periods of three years. Options to extend are not recognized as part of the lease liabilities or recognized as right to use assets. There are no residual value guarantees, no variable lease payments, and no restrictions or covenants imposed by leases. The discount rate used in measuring the lease liabilities and right ofuse assets was determined by reviewing our incremental borrowing rate at the initial measurement date. Three months ended March 31, 2019 Lease cost: Operating lease costs $ 280 Other information: Weighted average remaining lease term 2.21 years Weighted average discount rate 12 % Operating lease costs are included in general and administrative (“G&A”) expenses in the statement of operation and comprehensive loss. Operating cash flow supplemental information as of March 31, 2019: On January 1, 2019, initial right of use ("ROU") assets of $1,653 was recognized as a non-cash asset addition with the adoption of the new lease standard. During the three months ended March 31, 2019, the Company entered into a new lease agreement and recognized a ROU asset of $222. The following table summarizes future undiscounted cash payments reconciled to the lease liabilities: Year ending December 31 Remaining 2019 $ 760 2020 617 2021 541 2022 45 Total $ 1,963 Effect of discounting (244 ) Total lease liability $ 1,719 Less: current portion (795 ) Long term lease liability $ 924 ASC 840 comparative period disclosure The future annual minimum payments under these leases is as follows: Year ending December 31 Remaining 2019 $ 760 2020 617 2021 541 2022 45 Total $ 1,963 |
Segment Information
Segment Information | 3 Months Ended |
Mar. 31, 2019 | |
Segment Reporting [Abstract] | |
Segment Information | 13. SEGMENT INFORMATION The Company’s Chief Executive Officer (“CEO”) has been identified as the chief operating decision maker. The CEO evaluates the performance of the Company and allocates resources based on the information provided by the Company’s internal management system at a consolidated level. The Company has determined that it has only one operating segment. Revenues from external customers are attributed to geographic areas based on location of the contracting customers: Three Months Ended March 31 2019 2018 Israel $ 99 $ 106 China / Hong Kong 261 30 Europe - 42 Total $ 360 $ 178 There was no revenue attributed to our country of domicile, Canada, for the three months ended March 31, 2019 and 2018. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events | 14. SUBSEQUENT EVENTS Subsequent to March 31, 2019, the Company granted 300,000 stock options to new directors and employees pursuant to the 2016 Plan. 200,000 stock options vest on a monthly basis over 36 months and 100,000 stock options vest 25% on the first anniversary of the grant date and the remainder will vest on a monthly basis over 36 months thereafter. The options automatically expire 10 years from grant date. |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Consolidation | Basis of Presentation and Consolidation The Company’s fiscal year ends on December 31 of each calendar year. The accompanying unaudited condensed consolidated financial statements have been prepared in U.S. dollars (“USD”) and pursuant to the rules and regulations of the United States Securities and Exchange Commission (“SEC”), for interim reporting. Accordingly, certain information and footnote disclosures normally included in the financial statements prepared in accordance with United States of America generally accepted accounting principles (“U.S. GAAP”), have been condensed or omitted pursuant to such rules and regulations. The December 31, 2018 consolidated balance sheet in this document was derived from the audited consolidated financial statements. The condensed consolidated financial statements and notes included in this quarterly report on Form 10-Q (this “Form 10-Q”) does not include all of the disclosures required by U.S. GAAP and should be read in conjunction with the financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018 (the “2018 10-K”), as filed with the SEC on February 25, 2019. The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries: SciVac, VBI DE, VBI US, VBI Cda and SciVac HK. Intercompany balances and transactions between the Company and its subsidiaries are eliminated in the condensed consolidated financial statements. In the opinion of management, these condensed consolidated financial statements include all adjustments and accruals of a normal and recurring nature necessary to fairly state the results of the periods presented. The results for the periods presented are not necessarily indicative of results to be expected for the full year or for any future periods. |
Significant Accounting Policies | Significant Accounting Policies The significant accounting policies used in the preparation of these condensed consolidated financial statements are disclosed in the 2018 10-K, and there have been no changes to the Company’s significant accounting policies during the three months ended March 31, 2019, other than accounting for leases discussed below. |
Leases | Leases The Company determines if an arrangement is a lease at inception. For the Company’s operating leases, the right-of-use (“ROU”) assets represents the Company’s right to use an underlying asset for the lease term and operating lease liabilities represent an obligation to make lease payments arising from the lease. ROU assets and lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. Since the lease agreements do not provide an implicit rate, the Company estimated an incremental borrowing rate in determining the present value of the lease payments. Operating lease expense is recognized on a straight-line basis over the lease term, subject to any changes in the lease or expectations regarding the terms. Variable lease costs such as operating costs and property taxes are expensed as incurred. See also Note 3. |
Inventory, Net (Tables)
Inventory, Net (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | Inventory is stated at the lower of cost or market and consists of the following: March 31, 2019 December 31, 2018 Finished goods $ 60 $ 81 Work-in-process 67 64 Raw materials 956 766 $ 1,083 $ 911 |
Intangibles and Goodwill (Table
Intangibles and Goodwill (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangibles Assets | March 31, 2019 Gross Carrying Amount Accumulated Amortization Cumulative Impairment Charge Cumulative Currency Translation Net Book Value Patents $ 669 $ (472 ) $ - $ 18 $ 215 IPR&D assets 61,500 - (300 ) (1,950 ) 59,250 $ 62,169 $ (472 ) $ (300 ) $ (1,932 ) $ 59,465 December 31, 2018 Gross Carrying Amount Accumulated Amortization Cumulative Impairment Charge Cumulative Currency Translation Net Book Value Patents $ 669 $ (457 ) $ - $ 11 $ 223 IPR&D assets 61,500 - (300 ) (3,174 ) 58,026 $ 62,169 $ (457 ) $ (300 ) $ (3,163 ) $ 58,249 |
Other Current Liabilities (Tabl
Other Current Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Other Liabilities Disclosure [Abstract] | |
Schedule of Other Current Liabilities | Other current liabilities consisted of the following: March 31, 2019 December 31, 2018 Accrued research and development expenses (including clinical trial accrued expenses) $ 10,122 $ 9,763 Payroll and employee-related costs 1,179 2,294 Other current liabilities 1,251 1,790 $ 12,552 $ 13,847 |
Loss Per Share of Common Shar_2
Loss Per Share of Common Shares (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Earnings Per Share [Abstract] | |
Schedule of Antidilutive Weighted Average Shares Outstanding | The following potentially dilutive securities outstanding at March 31, 2019 and 2018 have been excluded from the computation of diluted weighted average shares outstanding, as they would be antidilutive: March 31, 2019 March 31, 2018 Warrants 2,618,824 2,618,824 Stock options and equity awards 7,377,995 3,960,549 9,996,819 6,579,373 |
Long-Term Debt - Related Party
Long-Term Debt - Related Party (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of Long-Term Debt | As at March 31, 2019 and the December 31, 2018, the long-term debt is as follows: March 31, 2019 December 31, 2018 Long-term debt, net of debt discount of $1,198 $ 14,102 $ 14,027 Less: current portion, net of debt discount of $141 (1,659 ) (1,100 ) $ 12,443 $ 12,927 |
Schedule of Interest Expense | Interest expense, net of interest income recorded in the three months ended March 31, 2019 and 2018 was as follows: Three months ended March 31 2019 2018 Interest expense – related party $ 518 $ 474 Amortization of debt discount – related party 255 299 Interest income (293 ) (234 ) Total interest expense, net of interest income $ 480 $ 539 |
Schedule of Future Payment of Long-Term Debt | The following table summarizes the future principal payments due under long-term debt: Principal payments on Third Amendment and exit fee Remaining 2019 $ 1,200 2020 14,100 $ 15,300 |
Stockholders' Equity and Addi_2
Stockholders' Equity and Additional Paid-In Capital (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Stockholders' Equity Note [Abstract] | |
Schedule of Stock Options Activity | Activity related to stock options is as follows: Number of Stock Options Weighted Average Exercise Price Balance outstanding at December 31, 2018 3,479,676 $ 4.14 Granted 3,570,000 $ 1.66 Forfeited (51,084 ) 4.62 Balance outstanding at March 31, 2019 6,998,592 $ 2.88 Exercisable at March 31, 2019 2,575,244 $ 4.16 |
Schedule of Restricted Stock Units | Information relating to RSUs is as follow: Number of Stock Awards Weighted Average Fair Value at Grant Date Unvested shares outstanding at December 31, 2018 268,570 $ 4.13 Granted 330,000 $ 1.65 Vested (219,167 ) $ 1.97 Unvested shares outstanding at March 31, 2019 379,403 $ 3.22 |
Schedule of Fair Value of Options Granted By Using Black-Scholes Option Pricing Assumptions | In determining the amount of stock-based compensation the Company used the Black-Scholes option pricing model to establish the fair value of options granted by applying the following weighted average assumptions: 2019 2018 Volatility 118.12 % 114.53 % Risk free interest rate 2.46 % 2.48 % Expected term in years 5.77 5.77 Expected dividend yield 0.00 % 0.00 % Weighted average fair value per option $ 1.43 $ 3.53 |
Schedule of Stock-based Compensation Expense | The total stock-based compensation expense recorded in the three months ended March 31, 2019 and 2018 was as follows: Three months ended March 31 2019 2018 Research and development $ 228 $ 191 General and administrative 1,017 618 Cost of revenues 17 13 Total stock-based compensation expense $ 1,262 $ 822 |
Revenues and Deferred Revenue (
Revenues and Deferred Revenue (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Summary of Revenue Comprised | Revenue is comprised of the following: March 31, 2019 March 31, 2018 Product revenues $ 93 $ 164 R&D service revenues 267 14 $ 360 $ 178 |
Summary of Revenue Expected to be Recognized in Future Related to Performance Obligations | The following table presents revenues expected to be recognized in the future related to performance obligations, based on current estimates, that are unsatisfied at March 31, 2019: Total Remaining 2019 2020 and thereafter Product revenues $ 469 $ - $ 469 R&D service revenues 4,623 2,333 2,290 Total $ 5,092 $ 2,333 $ 2,759 |
Summary of Changes in Deferred Revenue | The following table presents changes in the deferred revenue balance for the year ended December 31, 2018: Balance at December 31, 2018 $ 5,172 Recognition of deferred revenue (261 ) Currency translation 181 Balance at March 31, 2019 $ 5,092 Short Term $ 2,333 Long Term $ 2,759 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Lease Cost and Other Information | The discount rate used in measuring the lease liabilities and right of use assets was determined by reviewing our incremental borrowing rate at the initial measurement date. Three months ended March 31, 2019 Lease cost: Operating lease costs $ 280 Other information: Weighted average remaining lease term 2.21 years Weighted average discount rate 12 % |
Summary of Future Undiscounted Cash Payments Reconciled to Lease Liabilities | The following table summarizes future undiscounted cash payments reconciled to the lease liabilities: Year ending December 31 Remaining 2019 $ 760 2020 617 2021 541 2022 45 Total $ 1,963 Effect of discounting (244 ) Total lease liability $ 1,719 Less: current portion (795 ) Long term lease liability $ 924 |
Schedule of Future Annual Minimum Lease Payments | The future annual minimum payments under these leases is as follows: Year ending December 31 Remaining 2019 $ 760 2020 617 2021 541 2022 45 Total $ 1,963 |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Segment Reporting [Abstract] | |
Schedule of Revenue by Geographical Region | Revenues from external customers are attributed to geographic areas based on location of the contracting customers: Three Months Ended March 31 2019 2018 Israel $ 99 $ 106 China / Hong Kong 261 30 Europe - 42 Total $ 360 $ 178 |
Nature of Business and Contin_2
Nature of Business and Continuation of Business (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Accumulated deficit | $ 222,181 | $ 207,575 | |
Cash flows from operating activities | $ 14,020 | $ 8,578 |
New Accounting Pronouncements (
New Accounting Pronouncements (Details Narrative) $ in Thousands | Jan. 02, 2019USD ($) |
Accounting Changes and Error Corrections [Abstract] | |
ROU assets and lease liabilities | $ 1,653 |
Inventory, Net - Schedule of In
Inventory, Net - Schedule of Inventory (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Inventory Disclosure [Abstract] | ||
Finished goods | $ 60 | $ 81 |
Work-in-process | 67 | 64 |
Raw materials | 956 | 766 |
Inventory net | $ 1,083 | $ 911 |
Intangibles and Goodwill (Detai
Intangibles and Goodwill (Details Narrative) $ in Thousands | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Cumulative translation adjustments | $ 173 |
IPR&D assets [Member] | |
Cumulative translation adjustments | $ 1,217 |
Intangibles and Goodwill - Sche
Intangibles and Goodwill - Schedule of Intangibles Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2019 | Dec. 31, 2018 | |
Intangible assets, Gross | $ 62,169 | $ 62,169 |
Accumulated Amortization | (472) | (457) |
Cumulative Impairment Charge | (300) | (300) |
Cumulative Currency Translation | (1,932) | (3,163) |
Intangible assets, Net | 59,465 | 58,249 |
Patents [Member] | ||
Intangible assets, Gross | 669 | 669 |
Accumulated Amortization | (472) | (457) |
Cumulative Impairment Charge | ||
Cumulative Currency Translation | 18 | 11 |
Intangible assets, Net | 215 | 223 |
IPR&D [Member] | ||
Intangible assets, Gross | 61,500 | 61,500 |
Accumulated Amortization | ||
Cumulative Impairment Charge | (300) | (300) |
Cumulative Currency Translation | (1,950) | (3,174) |
Intangible assets, Net | $ 59,250 | $ 58,026 |
Other Current Liabilities - Sch
Other Current Liabilities - Schedule of Other Current Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Other Liabilities Disclosure [Abstract] | ||
Accrued research and development expenses (including clinical trial accrued expenses) | $ 10,122 | $ 9,763 |
Payroll and employee-related costs | 1,179 | 2,294 |
Other current liabilities | 1,251 | 1,790 |
Total Other current liabilities | $ 12,552 | $ 13,847 |
Loss Per Share of Common Shar_3
Loss Per Share of Common Shares - Schedule of Antidilutive Weighted Average Shares Outstanding (Details) - shares | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Antidilutive weighted average shares outstanding | 9,996,819 | 6,579,373 |
Warrants [Member] | ||
Antidilutive weighted average shares outstanding | 2,618,824 | 2,618,824 |
Stock Options and Equity Awards [Member] | ||
Antidilutive weighted average shares outstanding | 7,377,995 | 3,960,549 |
Long-Term Debt - Related Part_2
Long-Term Debt - Related Party (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | Jan. 31, 2019 | Jul. 17, 2018 | Dec. 06, 2016 | Mar. 31, 2019 | Dec. 31, 2018 | May 06, 2016 | Jul. 25, 2014 |
Number of warrants issued to purchase common stock shares | 363,771 | ||||||
Warrants to purchase common shares original expiration date description | Original expiration date of July 25, 2019 to December 6, 2021. | ||||||
Increase in debt discount | $ 179 | $ 386 | |||||
Term loan maturity date | Jun. 30, 2020 | ||||||
Exercise price of warrants | $ 2.75 | ||||||
Total debt discount | $ 4,018 | ||||||
Unamortized debt discount | 1,198 | $ 1,274 | |||||
Fair value of outstanding debt | $ 15,354 | $ 14,975 | |||||
From $4.13 [Member] | |||||||
Number of warrants issued to purchase common stock shares | 363,771 | 363,771 | |||||
Exercise price of warrants | $ 4.13 | $ 4.13 | |||||
From $3.355 [Member] | |||||||
Number of warrants issued to purchase common stock shares | 1,341,282 | ||||||
Exercise price of warrants | $ 3.355 | ||||||
Extended Maturity For Interest [Member] | |||||||
Debt instrument, extension date, description | December 31, 2018 to the Amortization Commencement Date (which is defined as the later of July 31, 2019 and, if Sci-B-Vac Phase III clinical trial endpoints are achieved by June 30, 2019, January 31, 2020) | May 31, 2018 to December 31, 2018 | |||||
Perceptive Credit Holdings, LP [Member] | |||||||
Line of credit maximum borrowing capacity | $ 6,000 | ||||||
Proceeds from line of credit | $ 13,200 | ||||||
Line of credit remaining balance | $ 1,800 | ||||||
Debt instrument, extension date, description | from December 6, 2019 to June 30, 2020 | ||||||
Term loan maturity date | Jun. 30, 2020 | ||||||
Exit fee | $ 300 | ||||||
Long term debt, gross | $ 15,300 | ||||||
Term loan annual interest rate description | The principal amount of the loan made under the Amended Credit Facility accrues interest at an annual rate equal to the greater of (a) one-month LIBOR (subject to a 5.00% cap) or (b) 1.00%, plus the Applicable Margin. The Applicable Margin will be 11.00%. | ||||||
Term loan interest rate | 13.50% | ||||||
Perceptive Credit Holdings, LP [Member] | Maximum [Member] | |||||||
Term loan interest rate | 4.00% | ||||||
Perceptive Credit Holdings, LP [Member] | LIBOR [Member] | |||||||
Variable rate, description | one-month LIBOR | ||||||
Debt instrument, variable rate | 1.00% | ||||||
Perceptive Credit Holdings, LP [Member] | Interest Cap [Member] | |||||||
Debt instrument, variable rate | 5.00% | ||||||
Perceptive Credit Holdings, LP [Member] | Applicable Margin [Member] | |||||||
Debt instrument, variable rate | 11.00% |
Long-Term Debt - Related Part_3
Long-Term Debt - Related Party - Schedule of Long-Term Debt (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Debt Disclosure [Abstract] | ||
Long-term debt, net of debt discount of $1,198 | $ 14,102 | $ 14,027 |
Less: current portion, net of debt discount of $141 | (1,659) | (1,100) |
Long-term debt | $ 12,443 | $ 12,927 |
Long-Term Debt - Related Part_4
Long-Term Debt - Related Party - Schedule of Long-Term Debt (Details) (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Debt discount | $ 1,198 | $ 1,274 |
Long-term Debt [Member] | ||
Debt discount | 1,198 | 1,198 |
Debt discount, current | $ 141 | $ 141 |
Long-Term Debt - Related Part_5
Long-Term Debt - Related Party - Schedule of Interest Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Debt Disclosure [Abstract] | ||
Interest expense - related party | $ 518 | $ 474 |
Amortization of debt discount - related party | 255 | 299 |
Interest income | (293) | (234) |
Total interest expense, net of interest income | $ 480 | $ 539 |
Long-Term Debt - Related Part_6
Long-Term Debt - Related Party - Schedule of Future Payment of Long-Term Debt (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Total | $ 14,102 | $ 14,027 |
Long-term Debt [Member] | ||
Remaining 2019 | 1,200 | |
2020 | 14,100 | |
Total | $ 15,300 |
Stockholders' Equity and Addi_3
Stockholders' Equity and Additional Paid-In Capital (Details Narrative) | 3 Months Ended |
Mar. 31, 2019shares | |
Number of common shares available for issuance | 1,396,061 |
2006 VBI US Stock Option Plan [Member] | |
Number of options outstanding | 1,112,696 |
2013 Equity Incentive Plan [Member] | |
Number of options outstanding | 3,460 |
2014 Equity Incentive Plan [Member] | |
Number of options outstanding | 604,474 |
2016 VBI Equity Incentive Plan [Member] | |
Maximum percentage of common shares issued and outstanding | 10.00% |
Maximum percentage of options granted | 10.00% |
Stock Options [Member] | 2016 VBI Equity Incentive Plan [Member] | |
Number of options outstanding | 5,277,962 |
Stock Awards [Member] | 2016 VBI Equity Incentive Plan [Member] | |
Number of options outstanding | 379,403 |
Stockholders' Equity and Addi_4
Stockholders' Equity and Additional Paid-In Capital - Schedule of Stock Options Activity (Details) - Stock Options [Member] | 3 Months Ended |
Mar. 31, 2019$ / sharesshares | |
Number of Stock Options Outstanding, Beginning Balance | shares | 3,479,676 |
Number of Stock Options, Granted | shares | 3,570,000 |
Number of Stock Options, Forfeited | shares | (51,084) |
Number of Stock Options Outstanding, Ending Balance | shares | 6,998,592 |
Number of Stock Options, Exercisable | shares | 2,575,244 |
Weighted Average Exercise Price, Beginning Balance | $ / shares | $ 4.14 |
Weighted Average Exercise Price, Granted | $ / shares | 1.66 |
Weighted Average Exercise Price, Forfeited | $ / shares | 4.62 |
Weighted Average Exercise Price, Ending Balance | $ / shares | 2.88 |
Weighted Average Exercise Price, Exercisable | $ / shares | $ 4.16 |
Stockholders' Equity and Addi_5
Stockholders' Equity and Additional Paid-In Capital - Schedule of Restricted Stock Units (Details) - $ / shares | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Weighted Average Fair Value at Grant Date, Granted | $ 1.43 | $ 3.53 |
Restricted Stock Units (RSUs) [Member] | ||
Number of Stock Awards, Unvested shares outstanding beginning balance | 268,570 | |
Number of Stock Awards, Granted | 330,000 | |
Number of Stock Awards, Vested | (219,167) | |
Number of Stock Awards, Unvested shares outstanding ending balance | 379,403 | |
Weighted Average Fair Value at Grant Date, Unvested shares outstanding beginning balance | $ 4.13 | |
Weighted Average Fair Value at Grant Date, Granted | 1.65 | |
Weighted Average Fair Value at Grant Date, Vested | 1.97 | |
Weighted Average Fair Value at Grant Date, Unvested shares outstanding | $ 3.22 |
Stockholders' Equity and Addi_6
Stockholders' Equity and Additional Paid-In Capital - Schedule of Fair Value of Options Granted By Using Black-Scholes Option Pricing Assumptions (Details) - $ / shares | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Stockholders' Equity Note [Abstract] | ||
Volatility | 118.12% | 114.53% |
Risk free interest rate | 2.46% | 2.48% |
Expected term in years | 5 years 9 months 7 days | 5 years 9 months 7 days |
Expected dividend yield | 0.00% | 0.00% |
Weighted average fair value per option | $ 1.43 | $ 3.53 |
Stockholders' Equity and Addi_7
Stockholders' Equity and Additional Paid-In Capital - Schedule of Stock-based Compensation Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Total stock-based compensation expense | $ 1,262 | $ 822 |
Research and Development [Member] | ||
Total stock-based compensation expense | 228 | 191 |
General and Administrative [Member] | ||
Total stock-based compensation expense | 1,017 | 618 |
Cost of Revenues [Member] | ||
Total stock-based compensation expense | $ 17 | $ 13 |
Revenues and Deferred Revenue_2
Revenues and Deferred Revenue (Details Narrative) $ in Thousands | Dec. 04, 2018USD ($)PerformanceObligationshares | Mar. 31, 2019USD ($) |
Remaining performance obligation, deemed to be initial transaction price | $ 5,092 | |
R&D Service Revenues [Member] | ||
Remaining performance obligation, deemed to be initial transaction price | 4,623 | |
Collaboration and License Agreement [Member] | R&D Service Revenues [Member] | ||
Payment of termination to previous third party on distribution rights | $ 4,400 | |
Collaboration and License Agreement [Member] | Brii Bio [Member] | ||
Non-refundable upfront payment | $ 11,000 | |
Stock issued for the agreement, shares | shares | 2,295,082 | |
Stock issued for the agreement | $ 3,600 | |
Remaining performance obligation, deemed to be initial transaction price | $ 7,400 | |
Number of performance obligations | PerformanceObligation | 2 | |
Additional potential regulatory and sales milestone payments | $ 117,500 | |
Collaboration and License Agreement [Member] | Brii Bio [Member] | R&D Services [Member] | ||
Remaining performance obligation, deemed to be initial transaction price | 4,800 | |
Collaboration and License Agreement [Member] | Brii Bio [Member] | VBI-2601 [Member] | ||
Remaining performance obligation, deemed to be initial transaction price | $ 2,600 |
Revenues and Deferred Revenue -
Revenues and Deferred Revenue - Summary of Revenue Comprised (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Revenues | $ 360 | $ 178 |
Product Revenues [Member] | ||
Revenues | 93 | 164 |
R&D Service Revenues [Member] | ||
Revenues | $ 267 | $ 14 |
Revenues and Deferred Revenue_3
Revenues and Deferred Revenue - Summary of Revenue Expected to be Recognized in Future Related to Performance Obligations (Details) $ in Thousands | Mar. 31, 2019USD ($) |
Revenue remaining performance obligations | $ 5,092 |
2019 [Member] | |
Revenue remaining performance obligations | 2,333 |
2020 and Thereafter [Member] | |
Revenue remaining performance obligations | 2,759 |
Product Revenues [Member] | |
Revenue remaining performance obligations | 469 |
Product Revenues [Member] | 2019 [Member] | |
Revenue remaining performance obligations | |
Product Revenues [Member] | 2020 and Thereafter [Member] | |
Revenue remaining performance obligations | 469 |
R&D Service Revenues [Member] | |
Revenue remaining performance obligations | 4,623 |
R&D Service Revenues [Member] | 2019 [Member] | |
Revenue remaining performance obligations | 2,333 |
R&D Service Revenues [Member] | 2020 and Thereafter [Member] | |
Revenue remaining performance obligations | $ 2,290 |
Revenues and Deferred Revenue_4
Revenues and Deferred Revenue - Summary of Changes in Deferred Revenue (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Revenue from Contract with Customer [Abstract] | |
Balance at December 31, 2018 | $ 5,172 |
Recognition of deferred revenue | (261) |
Currency translation | 181 |
Balance at March 31, 2019 | 5,092 |
Short Term | 2,333 |
Long Term | $ 2,759 |
Income Taxes (Details Narrative
Income Taxes (Details Narrative) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Statutory income tax rate | 26.50% | |
Canada [Member] | ||
Statutory income tax rate | 26.50% | |
Federal income tax rate | 0.00% | 0.00% |
Commitments and Contingencies_2
Commitments and Contingencies (Details Narrative) $ in Thousands | Sep. 13, 2018USD ($)VaccinatedChildren | Mar. 31, 2019USD ($) | Jan. 02, 2019USD ($) | Dec. 31, 2018USD ($) |
Operating leases expiration term description | The Company has entered into various non-cancelable lease agreements for its office, lab and manufacturing facilities, which are classified as operating leases. The office facility lease agreement in the United States expires on April 30, 2020, with no option to extend. Our manufacturing facility lease agreement expires on January 31, 2022, which includes one five-year option to extend until January 31, 2027. The lease agreement for our research facility in Canada, which comprises of office and laboratory space, expires on December 31, 2019 with the option to extend the term for two periods of three years. | |||
Initial right of use ("ROU") assets | $ 1,719 | $ 1,653 | ||
New Lease Agreement [Member] | ||||
Initial right of use ("ROU") assets | $ 222 | |||
Sci-B-Vac [Member] | ||||
Number of children vaccinated | VaccinatedChildren | 428,000 | |||
Seeking damages | $ 517,483 | |||
Sci-B-Vac [Member] | NIS Currency [Member] | ||||
Seeking damages | $ 1,879,500 |
Commitments and Contingencies -
Commitments and Contingencies - Schedule of Lease Cost and Other Information (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Commitments and Contingencies Disclosure [Abstract] | |
Operating lease costs | $ 280 |
Weighted average remaining lease term | 2 years 2 months 16 days |
Weighted average discount rate | 12.00% |
Commitments and Contingencies_3
Commitments and Contingencies - Summary of Future Undiscounted Cash Payments Reconciled to Lease Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Commitments and Contingencies Disclosure [Abstract] | ||
Remaining 2019 | $ 760 | |
2020 | 617 | |
2021 | 541 | |
2022 | 45 | |
Total | 1,963 | |
Effect of discounting | (244) | |
Total lease liability | 1,719 | |
Less: current portion | (795) | |
Long term lease liability | $ 924 |
Commitments and Contingencies_4
Commitments and Contingencies - Schedule of Future Annual Minimum Lease Payments (Details) $ in Thousands | Mar. 31, 2019USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
Remaining 2019 | $ 760 |
2020 | 617 |
2021 | 541 |
2022 | 45 |
Total | $ 1,963 |
Segment Information (Details Na
Segment Information (Details Narrative) | 3 Months Ended | |
Mar. 31, 2019USD ($)Segment | Mar. 31, 2018USD ($) | |
Number of operating segment | Segment | 1 | |
Canada [Member] | ||
Revenue | $ |
Segment Information - Schedule
Segment Information - Schedule of Revenue by Geographical Region (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Revenue | $ 360 | $ 178 |
Israel [Member] | ||
Revenue | 99 | 106 |
China/Hong Kong [Member] | ||
Revenue | 261 | 30 |
Europe [Member] | ||
Revenue | $ 42 |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - Subsequent Event [Member] - New Directors [Member] | 1 Months Ended |
May 01, 2019shares | |
Employees Pursuant 2016 Plan [Member] | |
Number of stock options granted | 300,000 |
Options expire term | The options automatically expire 10 years from grant date. |
Monthly Basis Over 36 Months [Member] | |
Stock options vest on monthly basis | 200,000 |
First Anniversary of Grant Date [Member] | |
Stock options vest on monthly basis | 100,000 |
Percentage of stock options vest | 25.00% |