Document And Entity Information
Document And Entity Information - shares | 3 Months Ended | |
Mar. 31, 2022 | May 06, 2022 | |
Document And Entity Information | ||
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2022 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity File Number | 000-16929 | |
Entity Registrant Name | SOLIGENIX, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 41-1505029 | |
Entity Address, Address Line One | 29 EMMONS DRIVE, SUITE B-10 | |
Entity Address, City or Town | PRINCETON, | |
Entity Address, State or Province | NJ | |
Entity Address, Postal Zip Code | 08540 | |
City Area Code | 609 | |
Local Phone Number | 538-8200 | |
Title of 12(b) Security | Common Stock, par value $.001 per share | |
Trading Symbol | SNGX | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Central Index Key | 0000812796 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q1 | |
Entity Common Stock, Shares Outstanding | 43,050,245 | |
Amendment Flag | false |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 22,875,679 | $ 26,043,897 |
Contracts and grants receivable | 123,692 | 138,889 |
Research and development incentives receivable | 121,238 | 103,832 |
Prepaid expenses and other current assets | 353,635 | 282,903 |
Total current assets | 23,474,244 | 26,569,521 |
Security deposit | 22,777 | 22,777 |
Office furniture and equipment, net of accumulated depreciation of $172,204 and $167,848 | 27,686 | 22,220 |
Deferred issuance cost | 20,266 | 20,266 |
Right-of-use lease assets | 75,230 | 106,155 |
Research and development incentive receivable | 50,566 | 121,238 |
Other assets | 3,875 | 7,750 |
Total assets | 23,674,644 | 26,869,927 |
Current liabilities: | ||
Accounts payable | 4,518,174 | 2,925,544 |
Accrued expenses | 2,592,296 | 2,956,545 |
Accrued compensation | 38,050 | 302,936 |
Lease liabilities - current | 75,230 | 106,151 |
Total current liabilities | 7,223,750 | 6,291,176 |
Non-current liabilities: | ||
Convertible debt, net of debt discount of $133,605 and $143,847 | 9,866,395 | 9,856,153 |
Total liabilities | 17,090,145 | 16,147,329 |
Commitments and Contingencies | ||
Shareholders' equity: | ||
Preferred stock, 350,000 shares authorized; none issued or outstanding | ||
Common stock, $.001 par value; 75,000,000 shares authorized; 42,954,091 shares and 42,873,445 shares issued and outstanding at March 31, 2022 and December 31, 2021, respectively | 42,954 | 42,873 |
Additional paid-in capital | 216,531,081 | 216,402,890 |
Accumulated other comprehensive income | 124,592 | 41,942 |
Accumulated deficit | (210,114,128) | (205,765,107) |
Total shareholders' equity | 6,584,499 | 10,722,598 |
Total liabilities and shareholders' equity | $ 23,674,644 | $ 26,869,927 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parentheticals) - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 |
Consolidated Balance Sheets | ||
Accumulated depreciation | $ 172,204 | $ 167,848 |
Debt discount, noncurrent | $ 133,605 | $ 143,847 |
Preferred stock, shares authorized | 350,000 | 350,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 75,000,000 | 75,000,000 |
Common stock, shares issued | 42,954,091 | 42,873,445 |
Common stock, shares outstanding | 42,954,091 | 42,873,445 |
Consolidated Statements of Oper
Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Total revenues | $ 188,063 | $ 147,593 |
Cost of revenues | (92,213) | (122,360) |
Gross profit | 95,850 | 25,233 |
Operating expenses: | ||
Research and development | 1,746,768 | 1,309,522 |
General and administrative | 2,551,710 | 949,318 |
Total operating expenses | 4,298,478 | 2,258,840 |
Loss from operations | (4,202,628) | (2,233,607) |
Other expense: | ||
Foreign currency transaction (loss)/gain | (108,293) | 27,253 |
Interest expense, net | (201,472) | (213,505) |
Research and development incentives | 163,372 | 57,381 |
Total other expense | (146,393) | (128,871) |
Net loss applicable to common stockholders | $ (4,349,021) | $ (2,362,478) |
Basic net loss per share (in Dollars per share) | $ (0.10) | $ (0.06) |
Diluted net loss per share (in Dollars per share) | $ (0.10) | $ (0.06) |
Basic weighted average common shares outstanding (in Shares) | 42,920,040 | 36,818,154 |
Diluted weighted average common shares outstanding (in Shares) | 42,920,040 | 36,818,154 |
Contract revenue | ||
Total revenues | $ 50,000 | $ 33,351 |
Grant revenue | ||
Total revenues | $ 138,063 | $ 114,242 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Consolidated Statements of Comprehensive Loss | ||
Net loss | $ (4,349,021) | $ (2,362,478) |
Other comprehensive loss: | ||
Foreign currency translation adjustments | 82,650 | (11,338) |
Comprehensive loss | $ (4,266,371) | $ (2,373,816) |
Consolidated Statements of Chan
Consolidated Statements of Changes in Shareholders' Equity (Unaudited) - USD ($) | Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Income/Loss | Accumulated Deficit | Total |
Balance at Dec. 31, 2020 | $ 30,644 | $ 196,949,655 | $ (24,337) | $ (193,214,134) | $ 3,741,828 |
Balance (in shares) at Dec. 31, 2020 | 30,643,656 | ||||
Issuance of common stock pursuant to B. Riley At Market Issuance Sales Agreement | $ 9,376 | 16,386,230 | 16,395,606 | ||
Issuance of common stock pursuant to B. Riley At Market Issuance Sales Agreement (in shares) | 9,376,792 | ||||
Issuance costs associated with B. Riley At Market Issuance Sales Agreement | (539,897) | (539,897) | |||
Exercise of common stock options | 51 | 51 | |||
Exercise of common stock options (in shares) | 13 | ||||
Share-based compensation expense | 94,805 | 94,805 | |||
Foreign currency translation adjustment | (11,338) | (11,338) | |||
Net loss | (2,362,478) | (2,362,478) | |||
Balance at Mar. 31, 2021 | $ 40,020 | 212,890,844 | (35,675) | (195,576,612) | 17,318,577 |
Balance (in Shares) at Mar. 31, 2021 | 40,020,461 | ||||
Balance at Dec. 31, 2021 | $ 42,873 | 216,402,890 | 41,942 | (205,765,107) | 10,722,598 |
Balance (in shares) at Dec. 31, 2021 | 42,873,445 | ||||
Issuance of common stock to vendors | $ 81 | 49,920 | 50,001 | ||
Issuance of common stock to vendors (in shares) | 80,646 | ||||
Share-based compensation expense | 78,271 | 78,271 | |||
Foreign currency translation adjustment | 82,650 | 82,650 | |||
Net loss | (4,349,021) | (4,349,021) | |||
Balance at Mar. 31, 2022 | $ 42,954 | $ 216,531,081 | $ 124,592 | $ (210,114,128) | $ 6,584,499 |
Balance (in Shares) at Mar. 31, 2022 | 42,954,091 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Operating activities: | ||
Net loss | $ (4,349,021) | $ (2,362,478) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Amortization and depreciation | 8,232 | 8,899 |
Non-cash lease expense | 30,925 | 27,995 |
Share-based compensation | 78,271 | 94,805 |
Issuance of common stock to vendors | 50,001 | |
Amortization of deferred issuance costs associated with convertible debt | 10,242 | 10,155 |
Change in operating assets and liabilities: | ||
Contracts and grants receivable | 15,197 | 42,050 |
Prepaid expenses and other current assets | (70,732) | (245,384) |
Research and development incentives receivable | 55,466 | 327,293 |
Operating lease liability | (30,921) | (27,996) |
Accounts payable and accrued expenses | 1,228,383 | (1,032,095) |
Accrued compensation | (264,886) | (828,471) |
Net cash used in operating activities | (3,238,843) | (3,985,227) |
Investing activities: | ||
Purchases of office furniture and equipment | (9,823) | |
Net cash used in investing activities | (9,823) | |
Financing activities: | ||
Proceeds from issuance of common stock pursuant to B. Riley At Market Issuance Sales Agreement | 16,395,606 | |
Costs associated with B. Riley At Market Issuance Sales Agreement | (492,445) | |
Proceeds from the exercise of warrants | 51 | |
Costs associated with issuance of convertible debt | (45,512) | |
Principal repayment - financing lease | (1,999) | |
Net cash provided by financing activities | 15,855,701 | |
Effect of exchange rate on cash and cash equivalents | 80,448 | (5,193) |
Net (decrease)/increase in cash and cash equivalents | (3,168,218) | 11,865,281 |
Cash and cash equivalents at beginning of period | 26,043,897 | 18,676,663 |
Cash and cash equivalents at end of period | 22,875,679 | 30,541,944 |
Supplemental information: | ||
Cash paid for state income taxes | 2,132 | |
Cash paid for interest | 223,901 | 221,178 |
Cash paid for lease liabilities: | ||
Operating lease | $ 33,325 | 33,325 |
Financing lease | 2,136 | |
Non-cash activities: | ||
Deferred issuance cost reclassified to additional-paid-in capital | $ 47,452 |
Nature of Business
Nature of Business | 3 Months Ended |
Mar. 31, 2022 | |
Nature of Business | |
Nature of Business | Note 1. Nature of Business Basis of Presentation Soligenix, Inc. (the “Company”) is a late-stage biopharmaceutical company focused on developing and commercializing products to treat rare diseases where there is an unmet medical need. The Company maintains two active business segments: Specialized BioTherapeutics and Public Health Solutions. The Company’s Specialized BioTherapeutics business segment is developing and moving toward commercialization of HyBryte™ (a proposed proprietary name of SGX301 or synthetic (hypericin), a novel photodynamic therapy (“PDT”) utilizing safe visible light for the treatment of cutaneous T-cell lymphoma (“CTCL”). With a successful Phase 3 study complete, regulatory approval is being sought and commercialization activities for this product candidate are being advanced initially in the United States (“U.S.”). Development programs in this business segment also include expansion of synthetic hypericin (SGX302) into psoriasis, the Company’s first-in-class innate defense regulator (“IDR”) technology, dusquetide (SGX942) for the treatment of inflammatory diseases, including oral mucositis in head and neck cancer, and proprietary formulations of oral beclomethasone 17,21-dipropionate (“BDP”) for the prevention/treatment of gastrointestinal (“GI”) disorders characterized by severe inflammation, including pediatric Crohn’s disease (SGX203). The Company’s Public Health Solutions business segment includes active development programs for RiVax ® ® The Company generates revenues under government grants primarily from the National Institutes of Health (“NIH”) and government contracts from the NIAID. The Company has a subcontract of approximately $700,000 from a NIAID grant over five years for its thermostabilization technology, a DTRA subcontract of approximately $600,000 over three years for SGX943 and a subcontract of approximately $1.5 million from a NIAID grant over two years for development of CiVax™. The Company will continue to apply for additional government funding. The Company is subject to risks common to companies in the biotechnology industry including, but not limited to, development of new technological innovations, dependence on key personnel, protections of proprietary technology, compliance with the U.S. Food and Drug Administration (the “FDA”) regulations, and other regulatory authorities, litigation, and product liability. Results for the three months ended March 31, 2022 are not necessarily indicative of results that may be expected for the full year. Liquidity In accordance with Accounting Standards Codification 205-40, Going Concern, the Company has evaluated whether there are conditions and events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date the consolidated financial statements are issued. As of March 31, 2022, the Company had an accumulated deficit of $210,114,128. During the three months ended March 31, 2022, the Company incurred a net loss of $4,349,021 and used $3,238,843 of cash in operations. The Company expects to continue to generate losses in the foreseeable future. The Company’s liquidity needs will be determined largely by the budgeted operational expenditures incurred in regards to the progression of its product candidates. The Company’s plans to meet its liquidity needs primarily include its ability to control the timing and spending on its research and development programs and raising additional funds through potential partnerships and/or financings. Based on the Company’s approved operating budget, current rate of cash outflows, cash on hand, proceeds from government contract and grant programs, and proceeds available from the sale of shares of the Company’s common stock via the At Market Issuance Sales Agreement (“B. Riley Sales Agreement”) with B. Riley Securities, Inc. (“B. Riley”), management believes that its current cash will be sufficient to meet the anticipated cash needs for working capital and capital expenditures for at least the next twelve months from issuance of the financial statements. As of March 31, 2022, the Company had cash and cash equivalents of $22,875,679 as compared to $26,043,897 as of December 31, 2021, representing a decrease of $3,168,218 or 12%. As of March 31, 2022, the Company had working capital of $16,250,494 as compared to working capital of $20,278,345 as of December 31, 2021, representing a decrease of $4,027,851 or 20%. The decrease in cash and cash equivalents and working capital was primarily related to cash used in operating activities. Management’s business strategy can be outlined as follows: ● Following positive primary endpoint results for the Phase 3 FLASH (Florescent Light Activated Synthetic Hypericin) clinical trial of HyBryte™ in CTCL as well as further statistically significant improvement in response rates with longer treatment (18 weeks compared to 12 and 6 weeks of treatment), pursue a New Drug Application (“NDA”) filing and commercialization in the U.S. while continuing to explore ex-U.S. partnership. ● Expand development of synthetic hypericin under the research name SGX302 into psoriasis following the positive Phase 3 FLASH study and positive proof-of-concept demonstrated in a small Phase 1/2 pilot study in mild-to-moderate psoriasis patients. ● Following feedback from the United Kingdom (“UK”) Medicines and Healthcare products Regulatory Agency (“MHRA”) that the SGX942 Phase 3 DOM-INNATE (Dusquetide treatment in Oral Mucositis – by modulating INNATE Immunity) clinical trial, having missed its primary endpoint, would not support a marketing authorization and MHRA indicating a second Phase 3 study would be needed; the Company will design a second study and attempt to identify a potential partner(s) to continue this development program. ● Continue development of the Company’s heat stabilization platform technology, ThermoVax ® , in combination with its programs for RiVax ® (ricin toxin vaccine), CiVax™ (COVID-19 vaccine) and filovirus vaccines for Ebola, Sudan, and Marburg Viruses, with U.S. government funding support. ● Continue to apply for and secure additional government funding for each of the Company’s Specialized BioTherapeutics and Public Health Solutions programs through grants, contracts and/or procurements. ● Pursue business development opportunities for the Company’s pipeline programs, as well as explore merger/acquisition strategies. ● Acquire or in-license new clinical-stage compounds for development, as well as evaluate new indications with existing pipeline compounds for development. The Company’s plans with respect to its liquidity management include, but are not limited to, the following: ● The Company has up to $1.2 million in active government grant funding still available as of March 31, 2022 to support its associated research programs through March 2023, provided the federal agencies do not elect to terminate the grants for convenience. The Company plans to submit additional contract and grant applications for further support of its programs with various funding agencies. However, there can be no assurance that the Company will obtain additional governmental grant funding; ● The Company has continued to use equity instruments to provide a portion of the compensation due to vendors and collaboration partners and expects to continue to do so for the foreseeable future; ● The Company will continue to pursue Net Operating Loss (“NOL”) sales in the state of New Jersey pursuant to its Technology Business Tax Certificate Transfer Program if available; ● The Company plans to pursue potential partnerships for pipeline programs as well as continue to explore merger and acquisition strategies. However, there can be no assurances that the Company can consummate such transactions; ● The Company has up to $26.8 million remaining from the B. Riley Sales Agreement as of May 6, 2022 under the prospectus supplement updated August 13, 2021; and ● The Company may seek additional capital in the private and/or public equity markets, to continue its operations, respond to competitive pressures, develop new products and services, and to support new strategic partnerships. The Company is evaluating additional equity/debt financing opportunities on an ongoing basis and may execute them when appropriate. However, there can be no assurances that the Company can consummate such a transaction, or consummate a transaction at favorable pricing . |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2022 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | Note 2. Summary of Significant Accounting Policies Principles of Consolidation The consolidated financial statements include Soligenix, Inc., and its wholly and majority owned subsidiaries. All significant intercompany accounts and transactions have been eliminated as a result of consolidation. Reclassifications Certain amounts in the statement of operations for the three months ended March 31, 2021 have been reclassified to conform to the current year presentation. Operating Segments Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated on a regular basis by the chief operating decision maker, or decision-making group, in deciding how to allocate resources to an individual segment and in assessing the performance of the segment. The Company divides its operations into two operating segments: Specialized BioTherapeutics and Public Health Solutions. Cash and Cash Equivalents The Company considers all highly liquid investments with maturities of three months or less when purchased to be cash equivalents. Contracts and Grants Receivable Contracts and grants receivable consist of amounts due from various grants from the NIH and contracts from NIAID, an institute of NIH, for costs incurred prior to the period end under reimbursement contracts. The amounts were billed to the respective governmental agencies in the month subsequent to period end and collected shortly thereafter. Accordingly, no allowance for doubtful amounts has been established. If amounts become uncollectible, they are charged to operations. Impairment of Long-Lived Assets Office furniture and equipment, and website development costs with finite lives are evaluated and reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. The Company recognizes impairment of long-lived assets in the event the net book value of such assets exceeds the estimated future undiscounted cash flows attributable to such assets. If the sum of the expected undiscounted cash flows is less than the carrying value of the related asset or group of assets, a loss is recognized for the difference between the fair value and the carrying value of the related asset or group of assets. Such analyses necessarily involve significant judgment. The Company did not record any impairment of long-lived assets for the three months ended March 31, 2022 and 2021. Fair Value of Financial Instruments FASB ASC 820 — Fair Value Measurements and Disclosures, FASB ASC 820 specifies a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect market assumptions. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement). The three levels of the fair value hierarchy are as follows: ● Level 1 — Quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Level 1 primarily consists of financial instruments whose value is based on quoted market prices such as exchange-traded instruments and listed equities. ● Level 2 — Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 includes financial instruments that are valued using models or other valuation methodologies. These models consider various assumptions, including volatility factors, current market prices and contractual prices for the underlying financial instruments. Substantially all of these assumptions are observable in the marketplace, can be derived from observable data or are supported by observable levels at which transactions are executed in the marketplace. ● Level 3 — Unobservable inputs for the asset or liability. Financial instruments are considered Level 3 when their fair values are determined using pricing models, discounted cash flows or similar techniques and at least one significant model assumption or input is unobservable. The carrying amounts reported in the consolidated balance sheets for cash and cash equivalents, contracts and/or grants receivable, research and development incentives receivable, accounts payable, accrued expenses, and accrued compensation approximate their fair value based on the short-term maturity of these instruments. The carrying amount reported in the consolidated balance sheets for convertible debt approximates its fair value based on its interest rate and maturity date. Revenue Recognition The Company’s revenues are primarily generated from government contracts and grants. The revenue from government contracts and grants is based upon subcontractor costs and internal costs incurred that are specifically covered by the contracts and grants, plus a facilities and administrative rate that provides funding for overhead expenses and management fees. These revenues are recognized when expenses have been incurred by subcontractors or when the Company incurs reimbursable internal expenses that are related to the government contracts and grants. Research and Development Costs Research and development costs are charged to expense when incurred in accordance with FASB ASC 730, Research and Development Share-Based Compensation Stock options are issued with an exercise price equal to the market price on the date of grant. Stock options issued to directors upon re-election vest quarterly for a period of one year (new director issuances are fully vested upon issuance). Stock options issued to employees generally vest 25% on the grant date, then 25% each subsequent year for a period of three years. These options have a ten year life for as long as the individuals remain employees or directors. In general, when an employee or director terminates their position, the options will expire within three months, unless otherwise extended by the Board. From time to time, the Company issues restricted shares of common stock to vendors and consultants as compensation for services performed under the Company’s 2015 Equity Incentive Plan (the “2015 Plan”). The 2015 Plan provides for the grant of stock options, restricted stock, deferred stock and unrestricted stock to the Company’s employees and non-employees (including consultants). The shares issued under the 2015 Plan are registered on Form S-8 (SEC File No. 333-208515). However, as shares of common stock are not covered by a reoffer prospectus, the certificates reflecting such shares reflect a Securities Act of 1933, as amended restrictive legend. Stock compensation expense for equity-classified awards to nonemployees is measured on the date of grant and is recognized when the services are performed. The fair value of options issued during the three months ended March 31, 2022 and 2021 was estimated using the Black-Scholes option-pricing model and the following assumptions: ● a dividend yield of 0% ; ● an expected life of 4 years ; ● volatility of 85% for 2022 and 87% for 2021; and ● risk free interest rates ranging from 1.12% - 2.15% for 2022 and 0.27% for 2021. The fair value of each option grant made during the three months ended March 31, 2022 and 2021 was estimated on the date of each grant and recognized as share-based compensation expense ratably over the option vesting periods, which approximates the service period. Foreign Currency Transactions and Translation In 2018, the Company changed the status of a wholly-owned subsidiary in the UK from inactive to active and incurred expenditures in multiple currencies including the U.S. dollar, the British Pound and the Euro to fund its clinical trial operations in the UK and select countries in Europe. In accordance with FASB ASC 830 Foreign Currency Matters Income Taxes Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. A valuation allowance is established when it is more likely than not that all or a portion of a deferred tax asset will not be realized. A review of all available positive and negative evidence is considered, including the Company’s current and past performance, the market environment in which the Company operates, the utilization of past tax credits, and the length of carryback and carryforward periods. Deferred tax assets and liabilities are measured utilizing tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The Company has not recognized any income tax benefit from the sale of New Jersey NOL carryforwards during the three months ended March 31, 2022 and 2021. The Company recognizes accrued interest and penalties associated with uncertain tax positions, if any, as part of income tax expense. There were no tax related interest and penalties recorded for the three months ended March 31, 2022 and 2021. Additionally, the Company has not recorded an asset for unrecognized tax benefits or a liability for uncertain tax positions at March 31, 2022 or December 31, 2021. Research and Development Incentive Income and Receivable The Company recognizes other income from UK research and development incentives when there is reasonable assurance that the income will be received, the relevant expenditure has been incurred, and the consideration can be reliably measured. The small or medium sized enterprise (“SME”) research and development tax relief program supports companies that seek to research and develop an advance in their field and is governed through legislative law by HM Revenue & Customs as long as specific eligibility criteria are met. Management has assessed the Company’s research and development activities and expenditures to determine which activities and expenditures are likely to be eligible under the SME research and development tax relief program described above. At each period end, management estimates the refundable tax offset available to the Company based on available information at the time. As the tax incentives may be received without regard to an entity’s actual tax liability, they are not subject to accounting for income taxes. As a result, amounts realized under the SME research and development tax relief program are recorded as a component of other income. The research and development incentive receivable represents an amount due in connections with the above-described tax relief program. The Company has recorded a research and development incentive receivable of approximately $172,000 and $225,000 as of March 31, 2022 and December 31, 2021, respectively, in the consolidated balance sheets. The following table shows the change in the UK research and development incentives receivable from December 31, 2021 to March 31, 2022: Current Long-Term Total Balance at December 31, 2021 $ 103,832 $ 121,238 $ 225,070 UK research and development incentives, transfer 121,238 (121,238) — UK research and development incentives — 55,466 55,466 Additional 2020 incentive earned 107,906 — 107,906 UK research and development incentives cash receipt (209,166) — (209,166) Foreign currency translation (2,572) (4,900) (7,472) Balance at March 31, 2022 $ 121,238 $ 50,566 $ 171,804 Loss Per Share Basic earnings per share (“EPS”) excludes dilution and is computed by dividing loss applicable to common stockholders by the weighted-average number of common shares outstanding for the period. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that shared in the earnings of the entity. Since there is a significant number of options and warrants outstanding, fluctuations in the actual market price can have a variety of results for each period presented. The following table summarizes potentially dilutive adjustments to the number of common shares which were excluded from the diluted calculation because their effect would be anti-dilutive due to the losses in each period: As of March 31, 2022 2021 Common stock purchase warrants 59,872 5,731,464 Stock options 2,195,140 1,993,804 Convertible debt 2,439,024 2,439,024 Total 4,694,036 10,164,292 The weighted average exercise price of the Company’s warrants and stock options outstanding at March 31, 2022 were $2.41 and $2.30 per share, respectively, and at March 31, 2021 were $2.96 and $2.91 per share, respectively. 3,268,200 of the Company’s common stock warrants associated with the July 2018 public offering expired on January 2, 2022. Use of Estimates and Assumptions The preparation of financial statements in conformity with accounting principles generally accepted in the U.S. requires management to make estimates and assumptions such as the fair value of warrants and stock options and to accrue for clinical trials in process that affect the reported amounts in the financial statements and accompanying notes. Actual results could differ from those estimates. |
Leases
Leases | 3 Months Ended |
Mar. 31, 2022 | |
Leases | |
Leases | Note 3. Leases The Company classifies a lease for its office space at 29 Emmons Drive, Suite B-10 in Princeton, New Jersey as an operating lease, and recorded a related right-of-use lease asset and lease liability accordingly. As of March 31, 2022 and December 31, 2021, the Company’s consolidated balance sheets included a right-of-use lease asset of $75,230 and $106,155 for the office space, respectively. Lease liabilities in the Company’s consolidated balance sheets as of March 31, 2022 and December 31, 2021 included corresponding lease liabilities of $75,230 and $106,151 for the office space, respectively. The following represents a reconciliation of contractual lease cash flows to the right-of-use lease asset and liability recognized in the financial statements: Operating Lease Right-of-use lease asset: Right-of-use lease asset, January 1, 2022 $ 106,155 Reduction/amortization 30,925 Right of use lease asset, March 31, 2022 $ 75,230 Lease liability: Lease liability, January 1, 2022 $ 106,151 Repayments 30,921 Lease liability, March 31, 2022 $ 75,230 Lease expenses for the three months ended March 31, 2022: Lease expense $ 33,330 Total $ 33,330 Contractual cash payments for the remaining lease term as of March 31, 2022: 2022 77,758 Total $ 77,758 Remaining lease term (months) as of March 31, 2022 7 |
Accrued Expenses
Accrued Expenses | 3 Months Ended |
Mar. 31, 2022 | |
Accrued Expenses | |
Accrued Expenses | Note 4. Accrued Expenses The following is a summary of the Company’s accrued expenses: March 31, December 31, 2022 2021 Clinical trial expenses $ 1,997,721 $ 2,625,779 Other 594,575 330,766 Total $ 2,592,296 $ 2,956,545 |
Debt
Debt | 3 Months Ended |
Mar. 31, 2022 | |
Debt | |
Debt | Note 5. Debt In December 2020, the Company entered into a $20 million convertible debt financing agreement with Pontifax Medison Debt Financing (“Pontifax”), the healthcare-dedicated venture and debt fund of the Pontifax life science funds. Under the terms of the agreement with Pontifax, the Company had access to up to $20.0 million in convertible debt financing in three tranches, which will mature on June 15, 2025 and have an interest only period for the first two years with an interest rate of 8.47% on borrowed amounts and an interest rate of 1% on amounts available but not borrowed as an unused line of credit fee. The agreement is secured by a lien covering substantially all of the Company’s assets, other than intellectual property. The agreement contains customary representations, warranties and covenants, including covenants by the Company limiting additional indebtedness, liens, including on intellectual property, guaranties, mergers and consolidations, substantial asset sales, investments and loans, certain corporate changes, transactions with affiliates and fundamental changes. Affirmative covenants include, among others, covenants requiring us to protect and maintain our intellectual property and comply with all applicable laws, deliver certain financial reports, maintain a minimum cash balance and maintain our insurance coverage. Upon the closing of this transaction, the Company accessed the first tranche of $10 million, had the option to draw the second tranche of $5 million at any time during the initial 12 months of the loan and the third tranche of $5 million upon filing of the HyBryte™ NDA, subject to certain conditions. The Company elected to let both the second and third tranches expire as of December 15, 2021 and March 15, 2022, respectively. Interest expense incurred during the three months ended March 31, 2022 and 2021 was $208,849 and $221,178, respectively. Interest expense paid during the three months ended March 31, 2022 and 2021 was $223,901 and $221,178, respectively. The Company amortized $10,242 and $10,155 of issuance costs during the three months ended March 31, 2022 and 2021, respectively. Net deferred issuance costs of $133,605 and $143,847 have been recorded as a reduction of the carrying value of the $10 million convertible debt borrowed as of March 31, 2022 and December 31, 2021, respectively. Pontifax may elect to convert the outstanding loan drawn into shares of the Company’s common stock at any time prior to repayment at a conversion price of $4.10 per share. The Company also has the ability to force the conversion of the loan into shares of the Company’s common stock at the same conversion price, subject to certain conditions. Principal and interest payments due, assuming no conversion is as follows: Year Principal Interest Total 2022 $ — $ 638,151 $ 638,151 2023 4,000,000 719,138 4,719,138 2024 4,000,000 380,338 4,380,338 2025 2,000,000 60,566 2,060,566 Total $ 10,000,000 $ 1,798,193 $ 11,798,193 |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2022 | |
Income Taxes | |
Income Taxes | Note 6. Income Taxes The Company had gross NOLs at December 31, 2021 of approximately $123.8 million for federal tax purposes, approximately $25.2 million for state tax purposes and approximately $1.4 million for foreign tax purposes. Federal losses generated in 2018 or later will carry forward indefinitely. In addition, the Company has approximately $8.6 million of various tax credits which credit the Company may be able to utilize its NOLs to reduce future federal and state income tax liabilities. However, these NOLs are subject to various limitations under Internal Revenue Code (“IRC”) Section 382. IRC Section 382 limits the use of NOLs to the extent there has been an ownership change of more than 50 percentage points. In addition, the NOL carryforwards are subject to examination by the taxing authority and could be adjusted or disallowed due to such exams. Although the Company has not undergone an IRC Section 382 analysis, it is likely that the utilization of the NOLs may be substantially limited. The Company and one or more of its subsidiaries files income tax returns in the U.S. federal jurisdiction, and various state and local jurisdictions. During 2021 and 2020, in accordance with the State of New Jersey’s Technology Business Tax Certificate Program, which allowed certain high technology and biotechnology companies to sell unused NOL carryforwards to other New Jersey-based corporate taxpayers, the Company sold New Jersey NOL carryforwards, but did not complete any sales during the three months ended March 31, 2022 or 2021 and therefore has not recognized any income tax benefit during the three months ended March 31, 2022 and 2021. The Company has not yet sold its 2021 New Jersey NOLs but may be able to do so in the future. There can be no assurance as to the continuation or magnitude of this program in the future. |
Shareholders' Equity
Shareholders' Equity | 3 Months Ended |
Mar. 31, 2022 | |
Shareholders' Equity | |
Shareholders' Equity | Note 7. Shareholders’ Equity Preferred Stock The Company has 350,000 shares of preferred stock authorized, none of which are issued or outstanding Common Stock The following items represent transactions in the Company’s common stock for the three months ended March 31, 2022: ● The Company issued a vendor 80,646 shares of fully vested common stock with a fair value of $0.62 per share on February 7, 2022. The issuance of the Company’s common stock to the vendor as described above was exempt under Section 4(a)(2) of the Securities Act of 1933, as amended. The vendor is knowledgeable, sophisticated and experienced in making investment decisions of this kind and received adequate information about the Company or had adequate access to information about the Company. The vendor represented to the Company that the vendor is not a “consultant” for purposes of Nasdaq Listing Rule 5635(c). B. Riley At Market Issuance Sales Agreement In August 2017, the Company entered into the B. Riley Sales Agreement to sell shares of the Company’s common stock from time to time, through an “at-the-market” equity offering program under which B. Riley acts as sales agent. Under the B. Riley Sales Agreement, the Company sets the parameters for the sale of shares, including the number of shares to be issued, the time period during which sales may be requested to be made, limitation on the number of shares that may be sold in any one trading day and any minimum price below which sales may not be made. The B. Riley Sales Agreement provides that B. Riley is entitled to compensation for its services in an amount equal to 3% of the gross proceeds from the sale of shares sold under the B. Riley Sale Agreement. The Company has no obligation to sell any shares under the B. Riley Sales Agreement, and may suspend solicitation and offers under the B. Riley Sales Agreement at any time. On August 13, 2021, the Company filed a prospectus supplement relating to the B. Riley Sales Agreement to offer and sell shares of Company common stock having an aggregate offering price of up to $30 million under the July 2020 Registration Statement. As of May 6, 2022, there was $26.8 million available for future sale of common stock under the B. Riley Sales Agreement. |
Concentrations
Concentrations | 3 Months Ended |
Mar. 31, 2022 | |
Concentrations | |
Concentrations | Note 8. Concentrations At March 31, 2022 and 2021, the Company had deposits in major financial institutions that exceeded the amount under protection by the Federal Deposit Insurance Corporation (“FDIC”). Currently, the Company is covered up to $250,000 by the FDIC and at times maintains cash balances in excess of the FDIC coverage. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2022 | |
Commitments and Contingencies. | |
Commitments and Contingencies | Note 9. Commitments and Contingencies Contractual Obligations The Company has commitments of approximately $280,000 as of March 31, 2022 over the next five years for several licensing agreements with partners and universities. Additionally, the Company has collaboration and license agreements, which upon clinical or commercialization success, may require the payment of milestones of up to approximately $13.2 million, royalties on net sales of covered products ranging from 2% to 3%, sub-license IND milestones on covered products of up to approximately $200,000, sub-license income royalties on covered products up to 15% and sub-license global net sales royalties on covered products ranging from 1.5% to 2.5%, if and when achieved. However, there can be no assurance that clinical or commercialization success will occur. The Company currently leases approximately 6,200 square feet of office space at 29 Emmons Drive, Suite B-10 in Princeton, New Jersey pursuant to a lease that expires in October 2022. This office space currently serves as the Company’s corporate headquarters, and both of the Company’s business segments (Specialized BioTherapeutics and Public Health Solutions), operate from this space. The rent is approximately $11,108 per month, or $21.50 per square foot, which rate will continue for the remainder of the lease period. In September 2014, the Company entered into an asset purchase agreement with Hy Biopharma Inc. (“Hy Biopharma”) pursuant to which the Company acquired certain intangible assets, properties and rights of Hy Biopharma related to the development of Hy BioPharma’s synthetic hypericin product. As consideration for the assets acquired, the Company paid $275,000 in cash and issued 184,912 shares of common stock with a fair value based on the Company’s stock price on the date of grant of $3.75 million. These amounts were charged to research and development expense during the third quarter of 2014 as the assets will be used in the Company’s research and development activities and do not have alternative future use pursuant to generally accepted accounting principles in the U.S. In March 2020, the Company issued 1,956,182 shares of common stock to Hy Biopharma as payment for achieving a milestone: the Company determining the Phase 3 clinical trial of HyBryte™ to be successful in the treatment of CTCL. The number of shares of common stock issued to Hy Biopharma was calculated using an effective price of $2.56 per share, based upon a formula set forth in the purchase agreement. Provided the sole remaining future success-oriented milestone is attained, the Company will be required to make an additional payment of $5.0 million, if and when achieved. Such payment will be payable in restricted securities of the Company provided such number of shares does not exceed 19.9% ownership of the Company’s outstanding stock. As of March 31, 2022, no other milestone or royalty payments have been paid or accrued. As a result of the above agreements, the Company has the following contractual obligations: Research and Property and Year Development Other Leases Total April 1 through December 31, 2022 $ 46,000 $ 77,758 $ 123,758 2023 96,000 — 96,000 2024 46,000 — 46,000 2025 46,000 — 46,000 2026 46,000 — 46,000 Total $ 280,000 $ 77,758 $ 357,758 Contingencies The Company follows subtopic 450-20 of the FASB Accounting Standards Codification to report accounting for contingencies. Certain conditions may exist as of the date the financial statements are issued, which may result in a loss to the Company but which will only be resolved when one or more future events occur or fail to occur. The Company assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. A liability is only recorded if management determines that it is both probable and reasonably estimable. COVID-19 Based on the current outbreak of SARS-CoV-2, the pathogen responsible for COVID-19, which has already had an impact on financial markets, there could be additional repercussions to the Company’s operating business, including but not limited to, the sourcing of materials for product candidates, manufacture of supplies for preclinical and/or clinical studies, delays in clinical operations, which may include the availability or the continued availability of patients for trials due to such things as quarantines, conduct of patient monitoring and clinical trial data retrieval at investigational study sites. The continued global spread of COVID-19 has affected the Company’s operations but did not have a material impact on our business, operating results, financial condition or cash flows as of and for the three months ended March 31, 2022. The future impact of the outbreak is highly uncertain and cannot be predicted, and the Company cannot provide any assurance that the outbreak will not have a material adverse impact on the Company’s operations or future results or filings with regulatory health authorities. The extent of the impact to the Company, if any, will depend on future developments, including actions taken to contain the coronavirus. Emergent BioSolutions Legal Proceedings In July 2020, the Company filed a demand for arbitration against Emergent BioSolutions, Inc. and certain of its subsidiaries (collectively, “Emergent”) with the American Arbitration Association in Mercer County, New Jersey. The Company alleges in the arbitration various breaches of contracts and warranties as well as acts of fraud. Emergent has answered that demand for arbitration denying the allegations and asserting affirmative defenses. The Company presented its case at an arbitration hearing over 12 days in January 2022. Following submission of post-hearing briefs, the arbitration panel heard closing oral arguments in April 2022 (see Part II, Item 1 – Legal Proceeding). The Company is seeking to recover damages in excess of $19 million from Emergent. While the Company intends to vigorously pursue this arbitration, the Company cannot offer any assurances that it will recover any damages from Emergent. The Company has received invoices from Emergent related to the above matter. No accrual has been made for these invoices as management deems them invalid and not probable of being required to pay them based on the numerous breaches cited in the pending arbitration. These invoices total approximately $331,000. |
Operating Segments
Operating Segments | 3 Months Ended |
Mar. 31, 2022 | |
Operating Segments | |
Operating Segments | Note 10. Operating Segments The Company maintains two active operating segments: Specialized BioTherapeutics and Public Health Solutions. Each segment includes an element of overhead costs specifically associated with its operations, with its corporate shared services group responsible for support functions generic to both operating segments. Three Months Ended March 31, 2022 2021 Revenues Specialized BioTherapeutics $ — $ — Public Health Solutions 188,063 147,593 Total $ 188,063 $ 147,593 Loss from Operations Specialized BioTherapeutics $ (1,539,728) $ (1,112,408) Public Health Solutions (120,621) (130,781) Corporate (2,542,279) (990,418) Total $ (4,202,628) $ (2,233,607) Amortization and Depreciation Expense Specialized BioTherapeutics $ 2,614 $ 1,899 Public Health Solutions 436 316 Corporate 5,182 6,684 Total $ 8,232 $ 8,899 Other (Expense)/Income, Net Specialized BioTherapeutics $ 55,079 $ 84,634 Corporate (201,472) (213,505) Total $ (146,393) $ (128,871) Share-Based Compensation Specialized BioTherapeutics $ 28,504 $ 29,579 Public Health Solutions 1,054 6,295 Corporate 48,713 58,931 Total $ 78,271 $ 94,805 As of As of March 31, December 31, 2022 2021 Identifiable Assets Specialized BioTherapeutics $ 223,895 $ 128,645 Public Health Solutions 132,921 146,296 Corporate 23,317,828 26,594,986 Total $ 23,674,644 $ 26,869,927 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2022 | |
Summary of Significant Accounting Policies | |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include Soligenix, Inc., and its wholly and majority owned subsidiaries. All significant intercompany accounts and transactions have been eliminated as a result of consolidation. |
Reclassifications | Reclassifications Certain amounts in the statement of operations for the three months ended March 31, 2021 have been reclassified to conform to the current year presentation. |
Operating Segments | Operating Segments Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated on a regular basis by the chief operating decision maker, or decision-making group, in deciding how to allocate resources to an individual segment and in assessing the performance of the segment. The Company divides its operations into two operating segments: Specialized BioTherapeutics and Public Health Solutions. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid investments with maturities of three months or less when purchased to be cash equivalents. |
Contracts and Grants Receivable | Contracts and Grants Receivable Contracts and grants receivable consist of amounts due from various grants from the NIH and contracts from NIAID, an institute of NIH, for costs incurred prior to the period end under reimbursement contracts. The amounts were billed to the respective governmental agencies in the month subsequent to period end and collected shortly thereafter. Accordingly, no allowance for doubtful amounts has been established. If amounts become uncollectible, they are charged to operations. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets Office furniture and equipment, and website development costs with finite lives are evaluated and reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. The Company recognizes impairment of long-lived assets in the event the net book value of such assets exceeds the estimated future undiscounted cash flows attributable to such assets. If the sum of the expected undiscounted cash flows is less than the carrying value of the related asset or group of assets, a loss is recognized for the difference between the fair value and the carrying value of the related asset or group of assets. Such analyses necessarily involve significant judgment. The Company did not record any impairment of long-lived assets for the three months ended March 31, 2022 and 2021. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments FASB ASC 820 — Fair Value Measurements and Disclosures, FASB ASC 820 specifies a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect market assumptions. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement). The three levels of the fair value hierarchy are as follows: ● Level 1 — Quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Level 1 primarily consists of financial instruments whose value is based on quoted market prices such as exchange-traded instruments and listed equities. ● Level 2 — Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 includes financial instruments that are valued using models or other valuation methodologies. These models consider various assumptions, including volatility factors, current market prices and contractual prices for the underlying financial instruments. Substantially all of these assumptions are observable in the marketplace, can be derived from observable data or are supported by observable levels at which transactions are executed in the marketplace. ● Level 3 — Unobservable inputs for the asset or liability. Financial instruments are considered Level 3 when their fair values are determined using pricing models, discounted cash flows or similar techniques and at least one significant model assumption or input is unobservable. The carrying amounts reported in the consolidated balance sheets for cash and cash equivalents, contracts and/or grants receivable, research and development incentives receivable, accounts payable, accrued expenses, and accrued compensation approximate their fair value based on the short-term maturity of these instruments. The carrying amount reported in the consolidated balance sheets for convertible debt approximates its fair value based on its interest rate and maturity date. |
Revenue Recognition | Revenue Recognition The Company’s revenues are primarily generated from government contracts and grants. The revenue from government contracts and grants is based upon subcontractor costs and internal costs incurred that are specifically covered by the contracts and grants, plus a facilities and administrative rate that provides funding for overhead expenses and management fees. These revenues are recognized when expenses have been incurred by subcontractors or when the Company incurs reimbursable internal expenses that are related to the government contracts and grants. |
Research and Development Costs | Research and Development Costs Research and development costs are charged to expense when incurred in accordance with FASB ASC 730, Research and Development |
Share-Based Compensation | Share-Based Compensation Stock options are issued with an exercise price equal to the market price on the date of grant. Stock options issued to directors upon re-election vest quarterly for a period of one year (new director issuances are fully vested upon issuance). Stock options issued to employees generally vest 25% on the grant date, then 25% each subsequent year for a period of three years. These options have a ten year life for as long as the individuals remain employees or directors. In general, when an employee or director terminates their position, the options will expire within three months, unless otherwise extended by the Board. From time to time, the Company issues restricted shares of common stock to vendors and consultants as compensation for services performed under the Company’s 2015 Equity Incentive Plan (the “2015 Plan”). The 2015 Plan provides for the grant of stock options, restricted stock, deferred stock and unrestricted stock to the Company’s employees and non-employees (including consultants). The shares issued under the 2015 Plan are registered on Form S-8 (SEC File No. 333-208515). However, as shares of common stock are not covered by a reoffer prospectus, the certificates reflecting such shares reflect a Securities Act of 1933, as amended restrictive legend. Stock compensation expense for equity-classified awards to nonemployees is measured on the date of grant and is recognized when the services are performed. The fair value of options issued during the three months ended March 31, 2022 and 2021 was estimated using the Black-Scholes option-pricing model and the following assumptions: ● a dividend yield of 0% ; ● an expected life of 4 years ; ● volatility of 85% for 2022 and 87% for 2021; and ● risk free interest rates ranging from 1.12% - 2.15% for 2022 and 0.27% for 2021. The fair value of each option grant made during the three months ended March 31, 2022 and 2021 was estimated on the date of each grant and recognized as share-based compensation expense ratably over the option vesting periods, which approximates the service period. |
Foreign Currency Transactions and Translation | Foreign Currency Transactions and Translation In 2018, the Company changed the status of a wholly-owned subsidiary in the UK from inactive to active and incurred expenditures in multiple currencies including the U.S. dollar, the British Pound and the Euro to fund its clinical trial operations in the UK and select countries in Europe. In accordance with FASB ASC 830 Foreign Currency Matters |
Income Taxes | Income Taxes Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. A valuation allowance is established when it is more likely than not that all or a portion of a deferred tax asset will not be realized. A review of all available positive and negative evidence is considered, including the Company’s current and past performance, the market environment in which the Company operates, the utilization of past tax credits, and the length of carryback and carryforward periods. Deferred tax assets and liabilities are measured utilizing tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The Company has not recognized any income tax benefit from the sale of New Jersey NOL carryforwards during the three months ended March 31, 2022 and 2021. The Company recognizes accrued interest and penalties associated with uncertain tax positions, if any, as part of income tax expense. There were no tax related interest and penalties recorded for the three months ended March 31, 2022 and 2021. Additionally, the Company has not recorded an asset for unrecognized tax benefits or a liability for uncertain tax positions at March 31, 2022 or December 31, 2021. |
Research and Development Incentive Income and Receivable | Research and Development Incentive Income and Receivable The Company recognizes other income from UK research and development incentives when there is reasonable assurance that the income will be received, the relevant expenditure has been incurred, and the consideration can be reliably measured. The small or medium sized enterprise (“SME”) research and development tax relief program supports companies that seek to research and develop an advance in their field and is governed through legislative law by HM Revenue & Customs as long as specific eligibility criteria are met. Management has assessed the Company’s research and development activities and expenditures to determine which activities and expenditures are likely to be eligible under the SME research and development tax relief program described above. At each period end, management estimates the refundable tax offset available to the Company based on available information at the time. As the tax incentives may be received without regard to an entity’s actual tax liability, they are not subject to accounting for income taxes. As a result, amounts realized under the SME research and development tax relief program are recorded as a component of other income. The research and development incentive receivable represents an amount due in connections with the above-described tax relief program. The Company has recorded a research and development incentive receivable of approximately $172,000 and $225,000 as of March 31, 2022 and December 31, 2021, respectively, in the consolidated balance sheets. The following table shows the change in the UK research and development incentives receivable from December 31, 2021 to March 31, 2022: Current Long-Term Total Balance at December 31, 2021 $ 103,832 $ 121,238 $ 225,070 UK research and development incentives, transfer 121,238 (121,238) — UK research and development incentives — 55,466 55,466 Additional 2020 incentive earned 107,906 — 107,906 UK research and development incentives cash receipt (209,166) — (209,166) Foreign currency translation (2,572) (4,900) (7,472) Balance at March 31, 2022 $ 121,238 $ 50,566 $ 171,804 |
Loss Per Share | Loss Per Share Basic earnings per share (“EPS”) excludes dilution and is computed by dividing loss applicable to common stockholders by the weighted-average number of common shares outstanding for the period. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that shared in the earnings of the entity. Since there is a significant number of options and warrants outstanding, fluctuations in the actual market price can have a variety of results for each period presented. The following table summarizes potentially dilutive adjustments to the number of common shares which were excluded from the diluted calculation because their effect would be anti-dilutive due to the losses in each period: As of March 31, 2022 2021 Common stock purchase warrants 59,872 5,731,464 Stock options 2,195,140 1,993,804 Convertible debt 2,439,024 2,439,024 Total 4,694,036 10,164,292 The weighted average exercise price of the Company’s warrants and stock options outstanding at March 31, 2022 were $2.41 and $2.30 per share, respectively, and at March 31, 2021 were $2.96 and $2.91 per share, respectively. 3,268,200 of the Company’s common stock warrants associated with the July 2018 public offering expired on January 2, 2022. |
Use of Estimates and Assumptions | Use of Estimates and Assumptions The preparation of financial statements in conformity with accounting principles generally accepted in the U.S. requires management to make estimates and assumptions such as the fair value of warrants and stock options and to accrue for clinical trials in process that affect the reported amounts in the financial statements and accompanying notes. Actual results could differ from those estimates. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Summary of Significant Accounting Policies | |
Schedule of United Kingdom research and development incentives receivable | Current Long-Term Total Balance at December 31, 2021 $ 103,832 $ 121,238 $ 225,070 UK research and development incentives, transfer 121,238 (121,238) — UK research and development incentives — 55,466 55,466 Additional 2020 incentive earned 107,906 — 107,906 UK research and development incentives cash receipt (209,166) — (209,166) Foreign currency translation (2,572) (4,900) (7,472) Balance at March 31, 2022 $ 121,238 $ 50,566 $ 171,804 |
Schedule of potentially dilutive adjustments to the weighted average number of common shares excluded from the calculation | As of March 31, 2022 2021 Common stock purchase warrants 59,872 5,731,464 Stock options 2,195,140 1,993,804 Convertible debt 2,439,024 2,439,024 Total 4,694,036 10,164,292 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Leases | |
Reconciliation of lease cash flows to the right-of-use lease assets and liabilities recognized in the financial statements. | Operating Lease Right-of-use lease asset: Right-of-use lease asset, January 1, 2022 $ 106,155 Reduction/amortization 30,925 Right of use lease asset, March 31, 2022 $ 75,230 Lease liability: Lease liability, January 1, 2022 $ 106,151 Repayments 30,921 Lease liability, March 31, 2022 $ 75,230 Lease expenses for the three months ended March 31, 2022: Lease expense $ 33,330 Total $ 33,330 Contractual cash payments for the remaining lease term as of March 31, 2022: 2022 77,758 Total $ 77,758 Remaining lease term (months) as of March 31, 2022 7 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Accrued Expenses | |
Schedule of accrued expenses | March 31, December 31, 2022 2021 Clinical trial expenses $ 1,997,721 $ 2,625,779 Other 594,575 330,766 Total $ 2,592,296 $ 2,956,545 |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Debt | |
Schedule of principle and interest payments due | Year Principal Interest Total 2022 $ — $ 638,151 $ 638,151 2023 4,000,000 719,138 4,719,138 2024 4,000,000 380,338 4,380,338 2025 2,000,000 60,566 2,060,566 Total $ 10,000,000 $ 1,798,193 $ 11,798,193 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Commitments and Contingencies. | |
Schedule of contractual obligation | Research and Property and Year Development Other Leases Total April 1 through December 31, 2022 $ 46,000 $ 77,758 $ 123,758 2023 96,000 — 96,000 2024 46,000 — 46,000 2025 46,000 — 46,000 2026 46,000 — 46,000 Total $ 280,000 $ 77,758 $ 357,758 |
Operating Segments (Tables)
Operating Segments (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Operating Segments | |
Schedule of operating segments | Three Months Ended March 31, 2022 2021 Revenues Specialized BioTherapeutics $ — $ — Public Health Solutions 188,063 147,593 Total $ 188,063 $ 147,593 Loss from Operations Specialized BioTherapeutics $ (1,539,728) $ (1,112,408) Public Health Solutions (120,621) (130,781) Corporate (2,542,279) (990,418) Total $ (4,202,628) $ (2,233,607) Amortization and Depreciation Expense Specialized BioTherapeutics $ 2,614 $ 1,899 Public Health Solutions 436 316 Corporate 5,182 6,684 Total $ 8,232 $ 8,899 Other (Expense)/Income, Net Specialized BioTherapeutics $ 55,079 $ 84,634 Corporate (201,472) (213,505) Total $ (146,393) $ (128,871) Share-Based Compensation Specialized BioTherapeutics $ 28,504 $ 29,579 Public Health Solutions 1,054 6,295 Corporate 48,713 58,931 Total $ 78,271 $ 94,805 As of As of March 31, December 31, 2022 2021 Identifiable Assets Specialized BioTherapeutics $ 223,895 $ 128,645 Public Health Solutions 132,921 146,296 Corporate 23,317,828 26,594,986 Total $ 23,674,644 $ 26,869,927 |
Nature of Business (Details)
Nature of Business (Details) | 3 Months Ended | |||
Mar. 31, 2022USD ($)segment | Mar. 31, 2021USD ($) | Dec. 31, 2021USD ($) | Aug. 13, 2021USD ($) | |
Nature of business: | ||||
Operating segments | segment | 2 | |||
Accumulated deficit | $ (210,114,128) | $ (205,765,107) | ||
Net loss | (4,349,021) | $ (2,362,478) | ||
Net cash used in operating activities | (3,238,843) | $ (3,985,227) | ||
Cash and cash equivalents | 22,875,679 | 26,043,897 | ||
Cash and cash equivalents, increase (decrease) | $ 3,168,218 | |||
Percentage change in cash and cash equivalent | 12.00% | |||
Working capital | $ 16,250,494 | 20,278,345 | ||
Working capital increase, decrease | $ 4,027,851 | |||
Working capital increase (decrease) as a percent | 20.00% | |||
Grants Receivable, Current | $ 123,692 | $ 138,889 | ||
FBR Sales Agreement | ||||
Nature of business: | ||||
Borrowing capacity | $ 26,800,000 | |||
CiVax | ||||
Nature of business: | ||||
Revenue from collaborative arrangement | $ 1,500,000 | |||
Term (in years) | two years | |||
NIH | ||||
Nature of business: | ||||
Grants Receivable, Current | $ 1,200,000 | |||
NIAID | Contract revenue | ||||
Nature of business: | ||||
Revenue from collaborative arrangement | $ 700,000 | |||
Term (in years) | five years | |||
DTRA | Contract revenue | ||||
Nature of business: | ||||
Revenue from collaborative arrangement | $ 600,000 | |||
Term (in years) | three years |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details) | Jan. 02, 2022shares | Mar. 31, 2022USD ($)segment$ / shares | Mar. 31, 2021USD ($)$ / shares | Dec. 31, 2021USD ($) |
Finite-Lived Intangible Assets [Line Items] | ||||
Operating segments | segment | 2 | |||
Amortization and depreciation | $ 8,232 | $ 8,899 | ||
Impairment of long-lived assets | $ 0 | $ 0 | ||
Requisite period (in years) | 3 years | |||
Expiration period | 10 years | |||
Option vesting rights | 25% | |||
Dividend yield | 0.00% | 0.00% | ||
Expected life | 4 years | 4 years | ||
Volatility rate | 85.00% | |||
Volatility rate minimum | 87.00% | |||
Risk-free interest rate | 0.27% | |||
Risk free interest rate, minimum | 1.12% | |||
Risk free interest rate, maximum | 2.15% | |||
Foreign currency transaction gain (loss) | $ (108,293) | $ 27,253 | ||
Interest and penalties | 0 | $ 0 | ||
Research and development incentive receivable | $ 172,000 | $ 225,000 | ||
Weighted average exercise price, outstanding warrants | $ / shares | $ 2.41 | $ 2.96 | ||
Weighted average exercise price | $ / shares | $ 2.30 | $ 2.91 | ||
Warrants | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Expired (in shares) | shares | 3,268,200 | |||
Termination benefits | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Expiration period | 3 months | |||
Directors | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Requisite period (in years) | 1 year |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - UK (Details) | 3 Months Ended |
Mar. 31, 2022USD ($) | |
Research and Development Arrangement, Contract to Perform for Others [Line Items] | |
Balance, Beginning balance | $ 225,070 |
UK research and development incentives | 55,466 |
Additional 2020 incentive earned | 107,906 |
UK research and development incentives cash receipt | (209,166) |
Foreign currency translation | (7,472) |
Balance, Ending balance | 171,804 |
Current Receivables | |
Research and Development Arrangement, Contract to Perform for Others [Line Items] | |
Balance, Beginning balance | 103,832 |
UK research and development incentives, transfer | 121,238 |
Additional 2020 incentive earned | 107,906 |
UK research and development incentives cash receipt | (209,166) |
Foreign currency translation | (2,572) |
Balance, Ending balance | 121,238 |
Long Term Receivable | |
Research and Development Arrangement, Contract to Perform for Others [Line Items] | |
Balance, Beginning balance | 121,238 |
UK research and development incentives, transfer | (121,238) |
UK research and development incentives | 55,466 |
Foreign currency translation | (4,900) |
Balance, Ending balance | $ 50,566 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Loss per share (Details) - shares | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Securities excluded | 4,694,036 | 10,164,292 |
Warrants | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Securities excluded | 59,872 | 5,731,464 |
Stock options | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Securities excluded | 2,195,140 | 1,993,804 |
Convertible debt securities | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Securities excluded | 2,439,024 | 2,439,024 |
Leases (Details)
Leases (Details) - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 |
Leases | ||
Right-of-use asset, operating lease | $ 75,230 | $ 106,155 |
Lease liability, operating lease | $ 75,230 | $ 106,151 |
Leases - Reconciliation (Detail
Leases - Reconciliation (Details) | 3 Months Ended |
Mar. 31, 2022USD ($) | |
Leases | |
Right-of-use lease asset, Beginning balance | $ 106,155 |
Reduction/amortization | 30,925 |
Right-of-use lease asset, Ending balance | 75,230 |
Lease liability - Operating, Beginning balance | 106,151 |
Repayments | 30,921 |
Lease liability - Operating, Ending balance | 75,230 |
Lease expense | |
Lease expense, operating lease | 33,330 |
Contractual cash payments, operating lease | |
2022 | 77,758 |
Total | $ 77,758 |
Remaining lease term (months), operating | 7 years |
Accrued Expenses (Details)
Accrued Expenses (Details) - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 | Mar. 31, 2021 |
Accrued Expenses | |||
Clinical trail expenses | $ 1,997,721 | $ 2,625,779 | |
Other | 594,575 | 330,766 | |
Accrued expenses | $ 2,592,296 | $ 2,956,545 | $ 2,956,545 |
Debt (Details)
Debt (Details) - USD ($) | 1 Months Ended | 3 Months Ended | ||
Dec. 31, 2020 | Mar. 31, 2022 | Mar. 31, 2021 | Dec. 31, 2021 | |
Debt instruments | ||||
Convertible debt | $ 9,866,395 | $ 9,856,153 | ||
Convertible Debt | ||||
Debt instruments | ||||
Debt instrument, face amount | $ 20,000,000 | |||
Tranches | three | |||
Effective interest rate | 8.47% | |||
Interest rate amounts available but not accessed | 1.00% | |||
Interest expense | 208,849 | $ 221,178 | ||
Interest paid | 223,901 | 221,178 | ||
Amortized issuance costs | 10,242 | $ 10,155 | ||
Deferred issuance costs | 133,605 | $ 143,847 | ||
Convertible debt borrowed | $ 10,000,000 | |||
Conversion price (in Dollars per share) | $ 4.10 | |||
Convertible Debt | Maximum | ||||
Debt instruments | ||||
Debt instrument, face amount | $ 20,000,000 | |||
Convertible Debt | First Tranche [Member] | ||||
Debt instruments | ||||
Convertible note | 10,000,000 | |||
Convertible Debt | Second Tranche [Member] | ||||
Debt instruments | ||||
Convertible note | 5,000,000 | |||
Convertible Debt | Third Tranche [Member] | ||||
Debt instruments | ||||
Convertible note | $ 5,000,000 |
Debt- Payments due (Details)
Debt- Payments due (Details) | Mar. 31, 2022USD ($) |
Debt instruments | |
2022 | $ 638,151 |
2023 | 4,719,138 |
2024 | 4,380,338 |
2025 | 2,060,566 |
Total | 11,798,193 |
Principal [Member] | |
Debt instruments | |
2022 | |
2023 | 4,000,000 |
2024 | 4,000,000 |
2025 | 2,000,000 |
Total | 10,000,000 |
Interest [Member] | |
Debt instruments | |
2022 | 638,151 |
2023 | 719,138 |
2024 | 380,338 |
2025 | 60,566 |
Total | $ 1,798,193 |
Income Taxes (Details)
Income Taxes (Details) $ in Millions | Dec. 31, 2021USD ($) |
Income Taxes | |
NOL for Federal tax | $ 123.8 |
NOL for State tax | 25.2 |
NOL for Foreign tax | 1.4 |
Various tax credits, amount | $ 8.6 |
Shareholders' Equity (Details)
Shareholders' Equity (Details) - USD ($) $ / shares in Units, $ in Millions | Feb. 07, 2022 | Aug. 31, 2017 | Mar. 31, 2021 | May 06, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | Aug. 13, 2021 |
Class of Stock [Line Items] | |||||||
Preferred stock, shares authorized | 350,000 | 350,000 | |||||
Preferred stock, shares issued | 0 | 0 | |||||
Preferred stock, shares outstanding | 0 | 0 | |||||
Shares issued to vendor | 80,646 | ||||||
Fair value per share | $ 0.62 | ||||||
Subsequent Event [Member] | |||||||
Class of Stock [Line Items] | |||||||
Common stock available for sale (in Dollars) | $ 26.8 | ||||||
Maximum | |||||||
Class of Stock [Line Items] | |||||||
Aggregate offering price (in Dollars) | $ 30 | ||||||
B. Riley Sales Agreement | |||||||
Class of Stock [Line Items] | |||||||
Threshold percentage of compensation from gross proceeds | 3.00% | ||||||
Common Stock | |||||||
Class of Stock [Line Items] | |||||||
Shares issued on option exercises | 13 |
Concentrations (Details)
Concentrations (Details) - USD ($) | Mar. 31, 2022 | Mar. 31, 2021 |
Concentrations | ||
Deposits | $ 250,000 | $ 250,000 |
Commitments and Contingencies_2
Commitments and Contingencies (Details) | Feb. 07, 2022shares | Jul. 31, 2020USD ($) | Mar. 31, 2020$ / sharesshares | Sep. 30, 2014USD ($)shares | Mar. 31, 2022USD ($)m²$ / ft² | Sep. 30, 2021USD ($) |
Other Commitments [Line Items] | ||||||
Commitments related to agreements | $ 280,000 | |||||
Maximum payment for commitment milestones | 13,200,000 | |||||
Sub license milestones payments on covered products | $ 200,000 | |||||
Percentage of sub license income on royalties | 15.00% | |||||
Office space (in Square Meters) | m² | 6,200 | |||||
Rent expenses per month | $ 11,108 | |||||
Rent expenses per square foot | $ / ft² | 21.50 | |||||
Cash paid to acquire Hy Biopharma intangible asset | $ 275,000 | |||||
Issuance of shares for assets (in shares) | shares | 184,912 | |||||
Fair value of shares issued in connection with Hy BioPharma asset purchase | $ 3,750,000 | |||||
Effective price per share (in Dollars per share) | $ / shares | $ 2.56 | |||||
Additional Payments | $ 5,000,000 | |||||
Ownership of company outstanding | 19.90% | |||||
Issuance of common stock | shares | 80,646 | |||||
Hy Biopharma Inc | ||||||
Other Commitments [Line Items] | ||||||
Issuance of common stock | shares | 1,956,182 | |||||
Emergent BioSolutions | ||||||
Other Commitments [Line Items] | ||||||
Amount of damages to be recovered | $ 19,000,000 | |||||
Invoices | $ 331,000 | |||||
Minimum | ||||||
Other Commitments [Line Items] | ||||||
Percentage for royalties | 2.00% | |||||
Percentage of global net sales royalties on covered products | 1.50% | |||||
Maximum | ||||||
Other Commitments [Line Items] | ||||||
Percentage for royalties | 3.00% | |||||
Percentage of global net sales royalties on covered products | 2.50% |
Commitments and Contingencies -
Commitments and Contingencies - Obligations (Details) | Mar. 31, 2021USD ($) |
Commitments: Contingencies | |
April 1 through December 31, 2022 | $ 123,758 |
2023 | 96,000 |
2024 | 46,000 |
2025 | 46,000 |
2026 | 46,000 |
Total | 357,758 |
Licensing Fee [Member] | |
Commitments: Contingencies | |
April 1 through December 31, 2022 | 46,000 |
2023 | 96,000 |
2024 | 46,000 |
2025 | 46,000 |
2026 | 46,000 |
Total | 280,000 |
Property and Other Leases [Member] | |
Commitments: Contingencies | |
April 1 through December 31, 2022 | 77,758 |
2023 | |
2024 | |
2025 | |
2026 | |
Total | $ 77,758 |
Operating Segments (Details)
Operating Segments (Details) | 3 Months Ended | ||
Mar. 31, 2022USD ($)segment | Mar. 31, 2021USD ($) | Dec. 31, 2021USD ($) | |
Segment reporting | |||
Revenues | $ 188,063 | $ 147,593 | |
Loss from operations | (4,202,628) | (2,233,607) | |
Amortization and depreciation | 8,232 | 8,899 | |
Other (Expense)/Income, Net | (146,393) | (128,871) | |
Share-based compensation | 78,271 | 94,805 | |
Identifiable Assets | $ 23,674,644 | $ 26,869,927 | |
Operating segments | segment | 2 | ||
Public Health Solutions [Member] | |||
Segment reporting | |||
Revenues | $ 188,063 | 147,593 | |
Loss from operations | (120,621) | (130,781) | |
Amortization and depreciation | 436 | 316 | |
Share-based compensation | 1,054 | 6,295 | |
Identifiable Assets | 223,895 | 128,645 | |
Specialized BioTherapeutics [Member] | |||
Segment reporting | |||
Loss from operations | (1,539,728) | (1,112,408) | |
Amortization and depreciation | 2,614 | 1,899 | |
Other (Expense)/Income, Net | 55,079 | 84,634 | |
Share-based compensation | 28,504 | 29,579 | |
Identifiable Assets | 132,921 | 146,296 | |
Corporate [Member] | |||
Segment reporting | |||
Loss from operations | (2,542,279) | (990,418) | |
Amortization and depreciation | 5,182 | 6,684 | |
Other (Expense)/Income, Net | (201,472) | (213,505) | |
Share-based compensation | 48,713 | $ 58,931 | |
Identifiable Assets | $ 23,317,828 | $ 26,594,986 |