Cover
Cover - shares | 9 Months Ended | |
Sep. 30, 2022 | Nov. 08, 2022 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Sep. 30, 2022 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2022 | |
Current Fiscal Year End Date | --12-31 | |
Entity File Number | 001-36242 | |
Entity Registrant Name | ADAMIS PHARMACEUTICALS CORP | |
Entity Central Index Key | 0000887247 | |
Entity Tax Identification Number | 82-0429727 | |
Entity Incorporation, State or Country Code | DE | |
Entity Address, Address Line One | 11682 El Camino Real | |
Entity Address, Address Line Two | Suite 300 | |
Entity Address, City or Town | San Diego | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 92130 | |
City Area Code | (858) | |
Local Phone Number | 997-2400 | |
Title of 12(b) Security | Common Stock | |
Trading Symbol | ADMP | |
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 Common Stock, Shares Outstanding | 149,983,265 |
UNAUDITED CONDENSED CONSOLIDATE
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) | Sep. 30, 2022 | Dec. 31, 2021 |
CURRENT ASSETS | ||
Cash and Cash Equivalents | $ 2,419,960 | $ 23,220,770 |
Restricted Cash | 30,056 | 30,023 |
Accounts Receivable, net | 1,306,505 | 815,565 |
Receivable from Fagron | 247,510 | 5,084,452 |
Inventories | 1,092,445 | 418,607 |
Prepaid Expenses and Other Current Assets | 803,415 | 1,313,546 |
Current Assets of Discontinued Operations (Note 2) | 4,188,239 | 4,320,659 |
Total Current Assets | 10,088,130 | 35,203,622 |
LONG TERM ASSETS | ||
Fixed Assets, net | 1,594,856 | 2,334,768 |
Right-of-Use Assets | 402,126 | 650,460 |
Other Non-Current Assets | 52,174 | 109,137 |
Total Assets | 12,137,286 | 38,297,987 |
CURRENT LIABILITIES | ||
Accounts Payable | 5,297,717 | 3,754,010 |
Accrued Other Expenses | 1,341,759 | 2,800,241 |
Product Recall Liability | 408,130 | 2,000,000 |
Accrued Bonuses | 535,624 | |
Lease Liabilities, current portion | 368,809 | 349,871 |
Deferred Revenue, current portion | 27,779 | 100,000 |
Current Liabilities of Discontinued Operations (Note 2) | 1,429,925 | 1,683,246 |
Total Current Liabilities | 8,874,119 | 11,222,992 |
LONG TERM LIABILITIES | ||
Deferred Revenue, net of current portion | 185,191 | 750,000 |
Lease Liabilities, net of current portion | 63,209 | 342,562 |
Warrant Liabilities, at fair value | 12,037 | 99,655 |
Total Liabilities | 9,134,556 | 12,415,209 |
Convertible Preferred Stock - Par Value $ .0001 ; 10,000,000 Shares Authorized: Series C Preferred Stock 3,000 Shares Authorized, liquidation preference $110 per share; 3,000 and 0 Issued and Outstanding at September 30, 2022 (Unaudited) and December 31, 2021, respectively. (Note 10) | 157,303 | |
STOCKHOLDERS’ EQUITY | ||
Common Stock - Par Value $ .0001 ; 200,000,000 Shares Authorized; 150,506,222 and 150,117,219 Issued, 149,983,265 and 149,594,262 Outstanding at September 30, 2022 (Unaudited) and December 31, 2021, respectively. | 15,051 | 15,012 |
Additional Paid-in Capital | 304,072,176 | 303,958,829 |
Accumulated Deficit | (301,236,550) | (278,085,813) |
Treasury Stock, at cost - 522,957 Shares at September 30, 2022 (Unaudited) and December 31, 2021. | (5,250) | (5,250) |
Total Stockholders’ Equity | 2,845,427 | 25,882,778 |
Total Liabilities, Mezzanine Equity and Stockholders’ Equity | $ 12,137,286 | $ 38,297,987 |
UNAUDITED CONDENSED CONSOLIDA_2
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Sep. 30, 2022 | Dec. 31, 2021 |
Convertible Preferred Stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Convertible Preferred Stock, authorized | 10,000,000 | 10,000,000 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, authorized | 200,000,000 | 200,000,000 |
Common stock, issued | 150,506,222 | 150,117,219 |
Common stock, outstanding | 149,983,265 | 149,594,262 |
Treasury Stock, Shares | 522,957 | 522,957 |
Series C Preferred Stock [Member] | ||
Convertible Preferred Stock, authorized | 3,000 | 3,000 |
Convertible Preferred Stock, liquidation preference (in dollars per share) | $ 110 | $ 110 |
Convertible Preferred Stock, issued | 3,000 | 0 |
Convertible Preferred Stock, outstanding | 3,000 | 0 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Income Statement [Abstract] | ||||
REVENUE, net | $ 1,505,683 | $ 759,962 | $ 2,605,396 | $ 3,368,115 |
COST OF GOODS SOLD | 1,647,585 | 1,565,922 | 3,705,697 | 5,207,402 |
Gross Loss | (141,902) | (805,960) | (1,100,301) | (1,839,287) |
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES | 2,508,176 | 4,794,485 | 10,096,807 | 13,247,027 |
RESEARCH AND DEVELOPMENT | 1,977,939 | 4,620,143 | 9,520,118 | 9,066,608 |
Loss from Operations | (4,628,017) | (10,220,588) | (20,717,226) | (24,152,922) |
OTHER INCOME (EXPENSE) | ||||
Interest Expense | (1,865) | (6,649) | ||
Interest/Other Income (Expense) | 298,118 | 1,932 | (379,392) | 5,283 |
Gain on Forgiveness of PPP Loans | 5,009,590 | 5,009,590 | ||
PPP2 Loan Contingent Loss | (1,787,417) | |||
Change in Fair Value of Warrant Liabilities | 58,690 | 42,525 | 87,618 | (7,642,949) |
Total Other Income (Expense), net | 356,808 | 5,052,182 | (2,079,191) | (2,634,725) |
Net Loss from Continuing Operations before Income Taxes | (4,271,209) | (5,168,406) | (22,796,417) | (26,787,647) |
Income Taxes | ||||
Net Loss from Continuing Operations | (4,271,209) | (5,168,406) | (22,796,417) | (26,787,647) |
DISCONTINUED OPERATIONS | ||||
Net Loss from Discontinued Operations before Income Taxes | (127,692) | (7,192,642) | (354,320) | (10,266,365) |
Income Taxes - Discontinued Operations | ||||
Net Loss from Discontinued Operations | (127,692) | (7,192,642) | (354,320) | (10,266,365) |
Net Loss Applicable to Common Stock | $ (4,398,901) | $ (12,361,048) | $ (23,150,737) | $ (37,054,012) |
Basic and Diluted Loss Per Share: | ||||
Continuing Operations, Basic (Loss) Per Share | $ (0.03) | $ (0.03) | $ (0.15) | $ (0.19) |
Continuing Operations, Diluted (Loss) Per Share | (0.03) | (0.03) | (0.15) | (0.19) |
Discontinued Operations, Basic (Loss) Per Share | 0 | (0.05) | 0 | (0.07) |
Discontinued Operations, Diluted (Loss) Per Share | 0 | (0.05) | 0 | (0.07) |
Basic Loss Per Share | (0.03) | (0.08) | (0.15) | (0.26) |
Diluted Loss Per Share | $ (0.03) | $ (0.08) | $ (0.15) | $ (0.26) |
Basic Weighted Average Shares Outstanding | 149,983,265 | 148,886,141 | 149,806,799 | 142,483,194 |
Diluted Weighted Average Shares Outstanding | 149,983,265 | 148,886,141 | 149,806,799 | 142,483,194 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF MEZZANINE EQUITY AND STOCKHOLDERS' EQUITY (Unaudited) - USD ($) | Common Stock [Member] | Additional Paid-in Capital [Member] | Treasury Stock [Member] | Retained Earnings [Member] | Total | Convertible Preferred Stock [Member] |
Beginning balance, value at Dec. 31, 2020 | $ 9,437 | $ 238,234,968 | $ (5,250) | $ (232,257,615) | $ 5,981,540 | |
Beginning balance (in shares) at Dec. 31, 2020 | 94,365,015 | 522,957 | ||||
Common Stock Issued, net of issuance costs of $ 3,330,752 | $ 4,661 | 48,414,585 | 48,419,246 | |||
Common Stock Issued, net of issuance costs of $3,330,752 (in shares) | 46,621,621 | |||||
Exercise of Warrants | $ 836 | 15,292,714 | 15,293,550 | |||
Exercise of Warrants (in shares) | 8,356,000 | |||||
Issuance of Common Stock upon Vesting of Restricted Stock Units (RSUs) | $ 7 | (7) | ||||
Issuance of Common Stock upon Vesting of Restricted Stock Units (RSUs) (in shares) | 66,462 | |||||
Share Based Compensation | 1,830,402 | 1,830,402 | ||||
Net Loss | (37,054,012) | (37,054,012) | ||||
Ending balance, value at Sep. 30, 2021 | $ 14,941 | 303,772,662 | $ (5,250) | (269,311,627) | 34,470,726 | |
Ending balance (in shares) at Sep. 30, 2021 | 149,409,098 | 522,957 | ||||
Beginning balance, value at Jun. 30, 2021 | $ 14,941 | 303,620,101 | $ (5,250) | (256,950,579) | 46,679,213 | |
Beginning balance (in shares) at Jun. 30, 2021 | 149,409,098 | 522,957 | ||||
Share Based Compensation | 152,561 | 152,561 | ||||
Net Loss | (12,361,048) | (12,361,048) | ||||
Ending balance, value at Sep. 30, 2021 | $ 14,941 | 303,772,662 | $ (5,250) | (269,311,627) | 34,470,726 | |
Ending balance (in shares) at Sep. 30, 2021 | 149,409,098 | 522,957 | ||||
Beginning balance, value at Dec. 31, 2021 | $ 15,012 | 303,958,829 | $ (5,250) | (278,085,813) | 25,882,778 | |
Beginning balance (in shares) at Dec. 31, 2021 | 150,117,219 | 522,957 | ||||
Beginning balance, Convertible Preferred Stock at Dec. 31, 2021 | ||||||
Issuance of Series C Preferred Stock, net of issuance costs of $8,300 | $ 157,303 | |||||
Issuance of Series C Preferred Stock, net of issuance costs of $8,300 (in shares) | 3,000 | |||||
Issuance of 750,000 Warrants, pursuant to the Series C Preferred Stock issuance, net of issuance costs of $6,700 | 127,697 | 127,697 | ||||
Issuance of Common Stock upon Vesting of Restricted Stock Units (RSUs) | $ 39 | (39) | ||||
Issuance of Common Stock upon Vesting of Restricted Stock Units (RSUs) (in shares) | 389,003 | |||||
Share Based Compensation | (14,311) | (14,311) | ||||
Net Loss | (23,150,737) | (23,150,737) | ||||
Ending balance, value at Sep. 30, 2022 | $ 15,051 | 304,072,176 | $ (5,250) | (301,236,550) | 2,845,427 | |
Ending balance (in shares) at Sep. 30, 2022 | 150,506,222 | 522,957 | 3,000 | |||
Ending balance, Convertible Preferred Stock at Sep. 30, 2022 | 157,303 | $ 157,303 | ||||
Beginning balance, value at Jun. 30, 2022 | $ 15,051 | 303,869,991 | $ (5,250) | (296,837,649) | 7,042,143 | |
Beginning balance (in shares) at Jun. 30, 2022 | 150,506,222 | 522,957 | ||||
Beginning balance, Convertible Preferred Stock at Jun. 30, 2022 | ||||||
Issuance of Series C Preferred Stock, net of issuance costs of $8,300 | $ 157,303 | |||||
Issuance of Series C Preferred Stock, net of issuance costs of $8,300 (in shares) | 3,000 | |||||
Issuance of 750,000 Warrants, pursuant to the Series C Preferred Stock issuance, net of issuance costs of $6,700 | 127,697 | 127,697 | ||||
Share Based Compensation | 74,488 | 74,488 | ||||
Net Loss | (4,398,901) | (4,398,901) | ||||
Ending balance, value at Sep. 30, 2022 | $ 15,051 | $ 304,072,176 | $ (5,250) | $ (301,236,550) | 2,845,427 | |
Ending balance (in shares) at Sep. 30, 2022 | 150,506,222 | 522,957 | 3,000 | |||
Ending balance, Convertible Preferred Stock at Sep. 30, 2022 | $ 157,303 | $ 157,303 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF MEZZANINE EQUITY AND STOCKHOLDERS' EQUITY (Unaudited) (Parenthetical) - USD ($) | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2022 | Sep. 30, 2021 | |
Statement of Stockholders' Equity [Abstract] | |||
Issuance of Series C Preferred Stock, issuance costs | $ 8,300 | $ 8,300 | |
Issuance of Warrants, pursuant to the Series C Preferred Stock issuance | 750,000 | 750,000 | |
Issuance of 750,000 Warrants, pursuant to the Series C Preferred Stock issuance, issuance costs | $ 6,700 | $ 6,700 | |
Common Stock Issued, issuance costs | $ 3,330,752 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($) | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net Loss | $ (23,150,737) | $ (37,054,012) |
Less: Loss from Discontinued Operations | 354,320 | 10,266,365 |
Adjustments to Reconcile Net Loss to Net Cash Used in Operating Activities: | ||
Stock Based Compensation | (14,311) | 1,830,402 |
Provision for Excess and Obsolete Inventory | 587,824 | |
Gain on Repayment of PPP2 Loan Contingent Loss Liability | 62,583 | |
Change in Fair Value of Warrant Liabilities | (87,618) | 7,642,949 |
Cash Payments in Excess of Lease Expense | (12,081) | (3,997) |
Depreciation and Amortization Expense | 1,111,495 | 1,071,830 |
Gain on Forgiveness of PPP Loans | (5,009,589) | |
Change in Assets and Liabilities: | ||
Accounts Receivable - Trade | (490,940) | (492,741) |
Receivable from Fagron | 919,413 | (6,492,321) |
Inventories | (673,838) | 639,237 |
Prepaid Expenses and Other Current Assets | 567,094 | 352,833 |
Accounts Payable | 1,319,707 | 730,759 |
Contingent Loss Liability | (7,900,000) | |
PPP2 Loan Contingent Loss Liability Payment | (1,850,000) | |
PPP2 Loan Contingent Loss Liability | 1,787,417 | |
Product Recall Liability | (1,591,870) | |
Deferred Revenue | (637,030) | (75,000) |
Accrued Other Expenses and Bonuses | (1,552,766) | 1,203,498 |
Net Cash Used in Operating Activities of Continuing Operations | (23,939,162) | (32,701,963) |
Net Cash (Used in) Provided by Operating Activities of Discontinued Operations | (439,301) | 1,590,310 |
Net Cash Used in Operating Activities | (24,378,463) | (31,111,653) |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Purchase of Equipment | (588,923) | (996,268) |
Proceeds from Sale of Non-financial Asset | 129,811 | |
Proceeds from Receivable from Fagron | 3,917,530 | |
Net Cash Provided by Investing Activities of Continuing Operations | 3,328,607 | (866,457) |
Net Cash Used in Investing Activities of Discontinued Operations | (15,999) | |
Net Cash Provided by (Used in) Investing Activities | 3,328,607 | (882,456) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Proceeds from Issuance of Common Stock, net of issuance costs of $3,330,752 | 48,419,246 | |
Proceeds from Issuance of Preferred Stock and Warrants, net of issuance costs of $15,000 | 285,000 | |
Proceeds from Exercise of Warrants | 5,851,900 | |
Proceeds of PPP Loan | 1,765,495 | |
Net Cash Provided by Financing Activities of Continuing Operations | 285,000 | 56,036,641 |
Net Cash Used In Financing Activities of Discontinued Operations | (2,057,948) | |
Net Cash Provided by Financing Activities | 285,000 | 53,978,693 |
(Decrease) Increase in Cash and Cash Equivalents and Restricted Cash | (20,764,856) | 21,984,584 |
Cash and Cash Equivalents, and Restricted Cash | ||
Beginning | 23,250,793 | 6,748,945 |
Change in Cash and Cash Equivalents of Discontinued Operations | (35,921) | 28,376 |
Ending Balance | 2,450,016 | 28,761,905 |
RECONCILIATION OF CASH & CASH EQUIVALENTS AND RESTRICTED CASH | ||
Cash & Cash Equivalents | 2,419,960 | 28,731,894 |
Restricted Cash | 30,056 | 30,011 |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | ||
Cash Paid for Income Taxes | 3,625 | 4,125 |
SUPPLEMENTAL DISCLOSURE OF NON-CASH OPERATING, FINANCING AND INVESTING ACTIVITIES | ||
Fixed Asset Additions included in Accrued Expenses | 217,340 | (73,517) |
Forgiveness of PPP Loans | $ 5,009,590 |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (Parenthetical) - USD ($) | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Convertible Preferred Stock [Member] | ||
Stock issuance costs | $ 15,000 | |
Common Stock [Member] | ||
Stock issuance costs | $ 3,330,752 |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Note 1: Basis of Presentation The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 8 of Regulation S-X promulgated by the Securities and Exchange Commission (“SEC”). Accordingly, certain information and footnote disclosures normally included in annual financial statements have been condensed or omitted. In the opinion of management, the accompanying unaudited interim condensed consolidated financial statements reflect all adjustments (including normal recurring adjustments and the elimination of intercompany accounts) considered necessary for a fair statement of all periods presented. The results of operations of Adamis Pharmaceuticals Corporation (“the Company”) for any interim periods are not necessarily indicative of the results of operations for any other interim periods or for a full fiscal year. These unaudited interim condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 (the “2021 Form 10-K”). For the three and nine months ended September 30, 2022 and September 30, 2021, and year ended December 31, 2021, the assets, liabilities, operations, and cash flows of the Company’s subsidiary, US Compounding, Inc. (“USC”), have been separated from the comparative period amounts to conform to the current period presentation as discontinued operations as the result of the Company’s decision to wind down and cease operations of USC and liquidate its remaining assets. See Note 2. Going Concern The Company’s cash and cash equivalents were $ 2,419,960 23,220,770 The condensed consolidated financial statements were prepared under the assumption that the Company will continue our operations as a going concern, which contemplates the realization of assets and the satisfaction of liabilities during the normal course of business. In preparing these condensed consolidated financial statements, consideration was given to the Company’s future business as described below, which may preclude the Company from realizing the value of certain assets. The Company has significant operating cash flow deficiencies. Additionally, the Company will need additional funding in the near term and thereafter in the future to sustain operations, satisfy existing and future obligations and liabilities, and otherwise support the Company’s operations and business activities and working capital needs. The preceding conditions raise substantial doubt about the Company’s ability to continue as a going concern. The condensed consolidated financial statements for the nine months ended September 30, 2022, were prepared under the assumption that we would continue our operations as a going concern, which contemplates the realization of assets and the satisfaction of liabilities during the normal course of business. Our unaudited condensed consolidated financial statements do not include any adjustments that may result from the outcome of this uncertainty. Management’s plans include attempting to secure additional required funding through equity or debt financings if available, seeking to enter into one or more strategic agreements regarding, or sales or out-licensing of, intellectual property or other assets, products, product candidates or technologies, seeking to enter into agreements with third parties to co-develop and fund research and development efforts, revenues from existing agreements, a merger, sale or reverse merger of the Company, or other strategic transaction. There is no assurance that the Company will be successful in obtaining the necessary funding to sustain its operations or meet its business objectives. The process of obtaining funding, or the terms of a strategic transaction, could result in significant dilution to our existing stockholders. In addition, a severe or prolonged economic downturn, political disruption or pandemic, such as the COVID-19 pandemic, could result in a variety of risks to our business, including our ability to raise capital when needed on acceptable terms, if at all. Basic and Diluted Loss per Share Under ASC 260, the Company is required to apply the two-class method to compute earnings per share (or, EPS). Under the two-class method both basic and diluted EPS are calculated for each class of common stock and participating security considering both dividends declared (or accumulated) and participation rights in undistributed earnings. The two-class method results in an allocation of all undistributed earnings as if all those earnings were distributed. Considering the Company has generated losses in each reporting period since its inception through September 30, 2022, the Company also considered the guidance related to the allocation of the undistributed losses under the two-class method. The contractual rights and obligations of the preferred stock shares were evaluated to determine if they have an obligation to share in the losses of the Company. As there is no obligation for the preferred stock shareholders to fund the losses of the Company nor is the contractual principal or mandatory redemption amount of the preferred stock shares reduced as a result of losses incurred by the Company, under the two-class method, the undistributed losses will be allocated entirely to the common stock securities. The Company computes basic loss per share by dividing the loss attributable to holders of common stock for the period by the weighted average number of shares of common stock outstanding during the period. The diluted loss per share calculation is based on the if-converted method for convertible preferred shares and gives effect to dilutive if-converted shares and the treasury stock method and gives effect to dilutive options, warrants and other potentially dilutive common stock. The preferred stock, however, is not considered potentially dilutive due to the contingency on the conversion feature not being tied to stock price or price of the convertible instrument. The common stock equivalents were anti-dilutive and were excluded from the calculation of weighted average shares outstanding. Potentially dilutive securities, which are not included in diluted weighted average shares outstanding for the nine months ended September 30, 2022 and September 30, 2021, consist of outstanding warrants covering 14,952,824 14,202,824 4,436,362 5,844,239 650,000 1,747,124 Discontinued Operations In accordance with ASC 205-20 Presentation of Financial Statements: Discontinued Operations Recent Accounting Pronouncement In May 2021, the FASB issued ASU No. 2021-04, Earnings Per Share (Topic 260), Debt—Modifications and Extinguishments (Subtopic 470-50), Compensation—Stock Compensation (Topic 718), and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options |
Discontinued Operations and Ass
Discontinued Operations and Assets Held for Sale | 9 Months Ended |
Sep. 30, 2022 | |
DISCONTINUED OPERATIONS | |
Discontinued Operations and Assets Held for Sale | Note 2: Discontinued Operations and Assets Held for Sale In August 2021, the Company announced an agreement with Fagron Compounding Services, LLC (“Fagron”) to sell to Fagron certain assets of the Company’s subsidiary, US Compounding, Inc. (“USC”), related to the Company’s human compounding pharmaceutical business including certain customer information and information on products sold to such customers by USC, including related formulations, know-how, and expertise regarding the compounding of pharmaceutical preparations, clinical support knowledge and other data and certain other information relating to the customers and products. The agreement included fixed consideration of approximately $ 107,000 6,385,000 278,000 (919,000) 700,000 In July 2021, the Company approved a restructuring process to wind down and cease the remaining operations at USC, with the remaining USC assets to be sold, liquidated or otherwise disposed of. The Company disposed of a component of its business in August 2021 and met the definition of a discontinued operation as of September 30, 2021. Accordingly, the operating results of the business disposed are reported as loss from discontinued operations in the accompany unaudited condensed statements of operations for the three months and nine months ended September 30, 2022 and 2021. As of December 31, 2021, the Company had shut down the operations of USC, terminated all of USC’s employees and was engaged in the process of selling or attempting to sell or otherwise dispose of USC’s remaining assets. Discontinued operations comprise those activities that were disposed of during the period, abandoned or which were classified as held for sale at the end of the period and represent a separate major line of business or geographical area that was previously distinguished as Compounded Pharmaceuticals segment for operational and financial reporting purposes in prior reported financial statements. Assets Held for Sale The Company considers assets to be held for sale when management approves and commits to a plan to actively market the assets for sale at a reasonable price in relation to its fair value, the assets are available for immediate sale in their present condition, an active program to locate a buyer and other actions required to complete the sale have been initiated, the sale of the assets is expected to be completed within one year and it is unlikely that significant changes will be made to the plan. Upon designation as held for sale, the Company ceases to record depreciation and amortization expenses and measures the assets at the lower of their carrying value or estimated fair value less costs to sell. Assets held for sale are included as current assets of discontinued operations in the Company’s consolidated balance sheets and the gain or loss from sale of assets held for sale is included in the Company’s general and administrative expenses. The major assets and liabilities associated with discontinued operations included in our consolidated balance sheets are as follows (unaudited): Carrying amounts of major classes of assets included as part of discontinued operations (unaudited): September 30, December 31 Carrying amounts of major classes of assets included as part of discontinued operations Cash and Cash Equivalents $ 1,928 $ 37,849 Accounts Receivable, net — 693 Inventories — 12,000 Fixed Assets, net 6,779,252 6,799,090 Other Assets 8,501 72,469 Loss recognized on classification as held for sale (2,601,442 ) (2,601,442 ) Total assets of the disposal group classified as discontinued operations in the statement of financial position $ 4,188,239 $ 4,320,659 Carrying amounts of major classes of liabilities included as part of discontinued operations Accounts Payable 621,466 681,646 Accrued Other Expenses 67,183 133,313 Lease Liabilities 285,346 412,357 Contingent Loss Liability 410,000 410,000 Deferred Tax Liability 45,930 45,930 Total liabilities of the disposal group classified as discontinued operations in the statement of financial position $ 1,429,925 $ 1,683,246 The revenues and expenses associated with discontinued operations included in our condensed consolidated statements of operations were as follows (unaudited): Three Months Ended 2022 2021 Major line items constituting pretax loss of discontinued operations REVENUE, net $ — $ 705,143 COST OF GOODS SOLD — (1,882,558 ) Gross Loss — (1,177,415 ) SELLING, GENERAL AND ADMINISTRATIVE EXPENSES (125,722 ) (2,457,162 ) RESEARCH AND DEVELOPMENT — (42,076 ) Impairment Expense – Intangible Assets — (3,835,158 ) Impairment Expense – Goodwill — (868,412 ) Impairment Expense – Inventory — (837,414 ) Impairment Expense – Right of Use Asset — (448,141 ) Loss from Held for Sale Classification — (2,177,844 ) (125,722 ) (11,843,622 ) OTHER INCOME (EXPENSE) Interest Income 22 8,619 Gain on Sale of Assets to Fagron — 4,636,702 Loss on Disposal of Assets (1,992 ) — Other Income — 5,659 Net Loss from discontinued operations before income taxes $ (127,692 ) $ (7,192,642 ) Nine Months Ended 2022 2021 Major line items constituting pretax loss of discontinued operations REVENUE, net $ — $ 6,216,826 COST OF GOODS SOLD — (5,753,658 ) — 463,168 SELLING, GENERAL AND ADMINISTRATIVE EXPENSES (390,105 ) (7,055,739 ) RESEARCH AND DEVELOPMENT — (89,710 ) Impairment Expense – Intangible — (3,835,158 ) Impairment Expense – Goodwill — (868,412 ) Impairment Expense – Inventory — (837,414 ) Impairment Expense – Right of Use Asset — (448,141 ) Impairment Expense – Fixed Assets — (9,346 ) Loss from Held for Sale Classification — (2,177,844 ) (390,105 ) (14,858,596 ) OTHER INCOME (EXPENSE) Interest Expense — (70,903 ) Interest Income 34 34 Gain on Sale of Assets to Fagron — 4,636,702 Gain on Disposal of Assets 27,138 Other Income 8,613 26,398 Net Loss from discontinued operations before income taxes $ (354,320 ) $ (10,266,365 ) Discontinued Operations - Revenue Compounded Pharmaceuticals Facility Revenue Recognition. The standard payment terms were 2%/10 and Net 30. Discontinued Operations - Lease USC has two one one one year four years 10,824 December 31, 2023 As part of the restructuring process to wind down and cease the operations at USC, the Company is working to cancel or transfer the leases of the discontinued operations. During the year ended December 31, 2021, the Right-of-Use assets related to the leases of approximately $ 448,000 285,000 412,000 Discontinued Operations - Contingent Loss Liability As of September 30, 2022, and December 31, 2021, the outstanding liabilities related to the contract termination costs recorded in contingent loss liability of discontinued operations was approximately $ 410,000 Discontinued Operations - Building Loan On November 10, 2016, a Loan Amendment and Assumption Agreement was entered with into the lender. Pursuant to the agreement, as subsequently amended, the Company agreed to pay the lender monthly 19,000 In July 2021, the Company, in connection with the sale of certain USC assets to Fagron, paid to the lender the outstanding principal balance, accrued unpaid interest and other obligations under the Company’s loan agreement, promissory note and related loan documents relating to the outstanding building loan relating to the building and property on which USC’s offices are located. The land and building were included in the assets of discontinued operations. The loan bore an interest of 6.00 0 0 0 71,000 |
Revenues
Revenues | 9 Months Ended |
Sep. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Revenues | Note 3: Revenues Revenue Recognition Revenue is recognized pursuant to ASC Topic 606, “ Revenue from Contracts with Customers 1. Identify the contract with the customer 2. Identify the performance obligations in the contract 3. Determine the transaction price 4. Allocate the transaction price to the performance obligations in the contract 5. Recognize revenue when (or as) each performance obligation is satisfied Adamis is a specialty biopharmaceutical company focused on developing and commercializing products in various therapeutic areas, including allergy, opioid overdose, respiratory and inflammatory disease. The Company’s subsidiary US Compounding, Inc. or USC, (a discontinued operation - see Note 2) provided compounded sterile prescription medications and certain nonsterile preparations and compounds, for human and veterinary use by patients, physician clinics, hospitals, surgery centers, vet clinics and other clients throughout most of the United States. USC’s product offerings broadly included, among others, corticosteroids, hormone replacement therapies, hospital outsourcing products, and injectables. In July 2021, the Company sold certain assets relating to USC’s human compounding pharmaceutical business and approved a restructuring process to wind down the remaining USC business and sell, liquidate or otherwise dispose of the remaining USC assets. Effective October 31, 2021, USC surrendered its Arkansas retail pharmacy permit and wholesaler/outsourcer permit and is no longer selling compounded pharmaceutical or veterinary products. Adamis and USC (prior to the sale of certain of its assets) have contracts with customers when (i) the Company enters into an enforceable contract with a customer that defines each party’s rights regarding the goods or services to be transferred and identifies the related payment terms, (ii) the contract has commercial substance, and (iii) the Company determines that collection of substantially all consideration for goods and services that are transferred is probable based on the customer’s intent and ability to pay the promised consideration. Exclusive Distribution and Commercialization Agreement for SYMJEPI ® ™ On May 11, 2020 (the “Effective Date”) the Company entered into an exclusive distribution and commercialization agreement (the “USWM Agreement”) with USWM for the United States commercial rights for the SYMJEPI products, as well as for the Company’s ZIMHI (naloxone HCI Injection, USP) 5mg/0.5mL product intended for the emergency treatment of opioid overdose. The Company’s revenues relating to its FDA approved products SYMJEPI and ZIMHI are dependent on the USWM Agreement. Under the terms of the USWM Agreement, the Company appointed USWM as the exclusive (including as to the Company) distributor of SYMJEPI in the United States and related territories (“Territory”) effective upon the termination of a Distribution and Commercialization Agreement previously entered into with Sandoz Inc., and of the ZIMHI product if approved by the U.S. Food and Drug Administration (“FDA”) for marketing, and granted USWM an exclusive license under the Company’s patent and other intellectual property rights and know-how to market, sell, and otherwise commercialize and distribute the products in the Territory, subject to the provisions of the USWM Agreement, in partial consideration of an initial payment by USWM and potential regulatory and commercial based milestone payments totaling up to $26 million, if the milestones are achieved. There can be no assurances that any of these milestones will be met or that any milestone payments will be paid to the Company. The Company retains rights to the intellectual property subject to the USWM Agreement and to commercialize both products outside of the Territory. In addition, the Company may continue to use the licensed intellectual property (excluding certain of the licensed trademarks) to develop and commercialize other products (with certain exceptions), including products that utilize the Company’s Symject™ syringe product platform. The initial term for the USWM Agreement began on the Effective Date and continues for a period of 10 The Company has determined that the individual purchase orders, whose terms and conditions taken with the distribution and commercialization agreement, creates a contract according to ASC 606. The term will automatically renew for five 10 The Company has determined that there are multiple performance obligations in the contract which are the following: the manufacture and supply of SYMJEPI™ and ZIMHI™ products to USWM, the license to distribute and commercialize SYMJEPI™ and ZIMHI™ products in the United States and the clinical development of ZIMHI™. The Company utilized significant judgement to develop estimates of the stand-alone selling price for each distinct performance obligation based upon the relative stand-alone selling price. The transaction price allocated to the clinical development of ZIMHI was immaterial. Revenues from the manufacture and supply of SYMJEPI™ and ZIMHI™ are recognized at a point in time upon delivery to the carrier. The licenses to distribute and commercialize SYMJEPI™ and ZIMHI™ products in the United States is distinct from the other performance obligations identified in the arrangement and has stand-alone functionality; the Company recognizes revenues from non-refundable, upfront fees allocated to the license when the license is transferred to the licensee and the licensee is able to benefit from the license. Payments received under USWM Agreement may include non-refundable fees at the inception of the arrangements, milestone payments for specific achievements and net-profit sharing payments based on certain percentages of net profit generated from the sales of products over a given quarter. At the inception of arrangements that include milestone payments, the Company uses judgement to evaluate whether the milestones are probable of being achieved and estimates the amount to include in the transaction price utilizing the most likely amount method. If it is probable that a significant revenue reversal will not occur, the estimated amount is included in the transaction price. Milestone payments that are not within the Company or the licensee’s control, such as regulatory approvals are not included in the transaction price until those approvals are received. At the end of each reporting period, the Company re-evaluates the probability of achievement of development milestones and any related constraint and adjusts the estimate of the overall transaction price, if necessary. The Company recognizes aggregate sales-based milestones, and net-profit sharing as royalties from product sales at the later of when the related sales occur or when the performance obligation to which the sales-based milestone or royalty has been allocated has been satisfied. The amounts receivable from USWM have a payment term of Net 30. Revenues do not include any state or local taxes collected from customers on behalf of governmental authorities. The Company made the accounting policy election to continue to exclude these amounts from revenues. Product Recall On March 21, 2022, we announced a voluntary recall of four lots of SYMJEPI (epinephrine) Injection 0.15 mg (0.15 mg/0.3 mL) and 0.3 mg (0.3 mg/0.3 mL) Pre-Filled Single-Dose Syringes to the consumer level, due to the potential clogging of the needle preventing the dispensing of epinephrine. USWM will handle the entire recall process for the Company, with Company oversight. SYMJEPI is manufactured and tested for us by Catalent Belgium S.A. The costs of the recall and the allocation of costs of the recall, including the costs to us resulting from the recall, were estimated at approximately $ 2 For the period ended September 30, 2022 and December 31, 2021, a liability of approximately $ 408,000 2 388,000 2.4 Deferred Revenue Deferred revenue are contract liabilities that the Company records when cash payments are received or due in advance of the Company’s satisfaction of performance obligations. The Company’s performance obligation is met when control of the promised goods is transferred to the Company’s customers. For the three months ended September 30, 2022 and 2021, approximately $ 587,000 25,000 587,000 75,000 213,000 850,000 562,000 Cost to Obtain a Contract The Company capitalizes incremental costs of obtaining a contract with a customer if the Company expects to recover those costs and that it would not have been incurred if the contract had not been obtained. The deferred costs, reported in the prepaid expenses and other current assets and other non-current assets on the Company’s consolidated balance sheets, will be amortized over the economic benefit period of the contract. Practical Expedients As part of the adoption of the ASC Topic 606, the Company elected to use the following practical expedients: (i) incremental costs of obtaining a contract in the form of sales commissions are expensed when incurred because the amortization period would have been one year or less. These costs are recorded within Selling, General and Administrative expenses; (ii) taxes collected from customers and remitted to government authorities and that are related to the sales of the Company’s products, are excluded from revenues; and (iii) shipping and handling activities are accounted for as fulfillment costs and recorded in cost of sales. |
Inventories
Inventories | 9 Months Ended |
Sep. 30, 2022 | |
Inventory Disclosure [Abstract] | |
Inventories | Note 4: Inventories Inventories at September 30, 2022 and December 31, 2021 consisted of the following: September 30, December 31, Work-in-Process $ 386,827 $ 386,610 Raw Materials 705,618 31,997 Inventories $ 1,092,445 $ 418,607 There was no reserve for obsolescence as of September 30, 2022 and December 31, 2021. |
Fixed Assets, net
Fixed Assets, net | 9 Months Ended |
Sep. 30, 2022 | |
Property, Plant and Equipment [Abstract] | |
Fixed Assets, net | Note 5: Fixed Assets, net Fixed Assets, net at September 30, 2022 and December 31, 2021 are summarized in the table below: Description Useful Life (Years) September 30, December 31, Machinery and Equipment 3 7 $ 5,224,025 $ 4,522,583 Less: Accumulated Depreciation (4,293,062 ) (3,181,567 ) Construction In Progress - Equipment 663,893 993,752 Fixed Assets, net $ 1,594,856 $ 2,334,768 Depreciation expense for the three months ended September 30, 2022 and 2021 was approximately $ 399,000 375,000 1,111,000 1,072,000 |
Leases
Leases | 9 Months Ended |
Sep. 30, 2022 | |
Leases | |
Leases | Note 6: Leases The Company has one 14 The amortizable lives of operating and financing leased assets are limited by the expected lease term. The Company’s lease does not provide an implicit rate, and therefore the Company uses its incremental borrowing rate as the discount rate when measuring operating and financing lease liabilities. The incremental borrowing rate represents an estimate of the interest rate the Company would incur at lease commencement to borrow an amount equal to the lease payments on a collateralized basis over the term of a lease within a particular currency environment. The Company used incremental borrowing rates as of January 1, 2019 for leases that commenced prior to that date. The Company’s weighted average remaining lease term and weighted average discount rate for operating and financing leases as of September 30, 2022 and December 31, 2021 were: September 30, 2022 Operating Weighted Average Remaining Lease Term 1.17 Weighted Average Discount Rate 3.95 December 31, 2021 Operating Weighted Average Remaining Lease Term 1.92 Weighted Average Discount Rate 3.95 The table below reconciles the undiscounted future minimum lease payments (displayed by year and in the aggregate) under non-cancelable leases with terms of more than one year to the total lease liabilities recognized on the unaudited condensed consolidated balance sheets as of September 30, 2022: Year Ending December 31, Operating Remainder of 2022 $ 93,431 2023 349,365 Undiscounted Future Minimum Lease Payments 442,796 Less: Difference between undiscounted lease payments and discounted lease liabilities 10,778 Total Lease Liabilities $ 432,018 Short-Term Lease Liabilities $ 368,809 Long-Term Lease Liabilities $ 63,209 Operating lease expense for the three months ended September 30, 2022 and 2021 was approximately $ 88,000 88,000 265,000 265,000 Cash paid for amounts included in the measurement of operating lease liabilities were approximately $ 93,000 90,000 278,000 269,000 |
Debt
Debt | 9 Months Ended |
Sep. 30, 2022 | |
Debt Disclosure [Abstract] | |
Debt | Note 7: Debt First Draw Paycheck Protection Program Loan On April 13, 2020, the Company received $ 3,191,700 3,191,700 Under the terms of the Note and the PPP Loan, interest accrues on the outstanding principal at the rate of 1.0 The CARES Act and the PPP provide a mechanism for forgiveness of up to the full amount borrowed. Under the PPP, the Company may apply for and be granted forgiveness for all or part of the PPP Loan. The amount of loan proceeds eligible for forgiveness is based on a formula that takes into account a number of factors, including the amount of loan proceeds used by the Company during a specified period after the loan origination for certain purposes including payroll costs, interest on certain mortgage obligations, rent payments on certain leases, and certain qualified utility payments, provided that at least 60 In December 2020, the Company submitted an application for the forgiveness of our PPP Loan. In August 2021, the Company received notification through the Bank that as of August 5, 2021, the PPP Loan, including principal and interest thereon, has been fully forgiven by the SBA and that the remaining PPP Loan balance is zero Second Draw PPP Loan On March 15, 2021, the Company entered into a Note (the “PPP2 Note”) in favor of the Bank, in the principal amount of $ 1,765,495 1.0 1,850,000 1,787,417 Even though the PPP Loan has been forgiven and the Second Draw PPP Loan repaid, our PPP loans and applications for forgiveness of loan amounts remain subject to review and audit by SBA for compliance with program requirements set forth in the PPP Interim Final Rules and in the Borrower Application Form, including without limitation the required economic necessity certification by the Company that was part of the PPP loan application process. Accordingly, the Company is subject to audit or review by federal or state regulatory authorities as a result of applying for and obtaining the PPP Loan and Second Draw PPP Loan or obtaining forgiveness of those loans. If the Company were to be audited or reviewed and receive an adverse determination or finding in such audit or review, including a determination that the Company was ineligible to receive the applicable loan, the Company could be required to return or repay the full amount of the applicable loan and could be subject to additional fines or penalties, which could reduce the Company's liquidity and adversely affect our business, financial condition and results of operations. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | Note 8: Fair Value of Financial Instruments The carrying value of the Company’s cash and cash equivalents, prepaid expenses and other current assets, accounts payable and accrued liabilities, approximate fair value due to the short-term nature of these items. Fair value is defined as the exchange price that would be received for an asset or an exit price paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The fair value hierarchy defines a three-level valuation hierarchy for disclosure of fair value measurements as follows: Level 1: Unadjusted quoted prices in active markets for identical assets or liabilities; Level 2: Inputs other than quoted prices included within Level I that are observable, unadjusted quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the related assets or liabilities; and Level 3: Unobservable inputs that are supported by little or no market activity for the related assets or liabilities. T The following table sets forth the Company’s financial instruments that were measured at fair value on a recurring basis by level within the fair value hierarchy: Fair Value Measurements at September 30, 2022 Total Level 1 Level 2 Level 3 Liabilities 2020 Warrant liability $ 12,037 $ — $ — $ 12,037 The fair value measurement of the warrants issued by the Company in February 2020 (the “2020 Warrants”) are based on significant inputs that are unobservable and thus represents a Level 3 measurement. The Company’s estimated fair value of the Warrant liability is calculated using the Black Scholes Option Pricing Model. Key assumptions at September 30, 2022 include the expected volatility of the Company’s stock of approximately 70 0.199 0.0 2.93 4.255 Fair Value Measurements at December 31, 2021 Total Level 1 Level 2 Level 3 Liabilities 2020 Warrant liability $ 99,655 $ — $ — $ 99,655 The fair value measurement of the warrants issued by the Company in February 2020 (the “2020 Warrants”) are based on significant inputs that are unobservable and thus represents a Level 3 measurement. The Company’s estimated fair value of the Warrant liability is calculated using the Black Scholes Option Pricing Model. Key assumptions at December 31, 2021 include the expected volatility of the Company’s stock of approximately 70 0.605 0.0 3.68 1.038 The following table sets forth a summary of changes in the fair value of the Company's Level 3 financial instruments, which are treated as liabilities, as follows: 2020 Warrant Number of Liability Balance at December 31, 2021 350,000 $ 99,655 Change in Fair Value, March 31, 2022 — (9,387) Change in Fair Value, June 30, 2022 — (19,540) Change in Fair Value, September 30, 2022 — (58,690) Balance at September 30, 2022 350,000 $ 12,037 |
Legal Matters
Legal Matters | 9 Months Ended |
Sep. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Legal Matters | Note 9: Legal Matters The Company may from time to time become party to actions, claims, suits, investigations or proceedings arising from the ordinary course of our business, including actions with respect to intellectual property claims, breach of contract claims, labor and employment claims and other matters. We may also become party to litigation in federal and state courts relating to opioid drugs. Any litigation could divert management time and attention from Adamis, could involve significant amounts of legal fees and other fees and expenses, or could result in an adverse outcome having a material adverse effect on our financial condition, cash flows or results of operations. Actions, claims, suits, investigations and proceedings are inherently uncertain and their results cannot be predicted with certainty. Except as described below, we are not currently involved in any legal proceedings that we believe are, individually or in the aggregate, material to our business, results of operations or financial condition. However, regardless of the outcome, litigation can have an adverse impact on us because of associated cost and diversion of management time. Investigations On May 11, 2021, the Company and USC each received a grand jury subpoena from the U.S. Attorney’s Office for the Southern District of New York (“USAO”). The USAO issued the subpoenas in connection with a grand jury investigation and requested a broad range of documents and materials relating to, among other matters, certain veterinary products sold by USC, certain practices, agreements, and arrangements relating to products sold by USC, including veterinary products, and certain regulatory and other matters relating to the Company and USC. The Audit Committee of the Board engaged outside counsel to conduct an independent internal investigation to review the matters brought forth in the subpoenas and certain other matters. In addition, following the commencement of the investigation, as disclosed elsewhere in these interim condensed consolidated financial statements, the Company has sold assets relating to its compounding pharmacy business, ceased selling human and veterinary compounded pharmaceutical products, has wound down USC’s business, and the employment of USC employees has ended. As a result, the Company is no longer engaged in the sale of human or veterinary compounded pharmaceutical products. The Company is also considering a number of additional actions in response to the internal investigation and the USAO investigation. As of the date of these interim condensed consolidated financial statements, we believe that the investigation initially commenced by the Audit Committee is substantially complete. However, additional issues or facts could arise or be determined, which may expand the scope, duration, or outcome of the Audit Committee’s investigation. The Company has also received requests from the U.S. Securities and Exchange Commission (“SEC”) for the voluntary production of documents and information in connection with the SEC’s investigation relating to the subject matter of the USAO’s subpoenas and certain other matters. The Company has produced documents and will continue to produce and provide documents in response to subpoenas and requests for voluntary production of documents as needed. Additionally, on March 16, 2022, the Company was informed that the Civil Division of the USAO (“Civil Division”) was investigating the Company’s Second Draw PPP Loan application and the company’s eligibility for the Second Draw PPP Loan. The Audit Committee of the Board engaged outside counsel to conduct an internal inquiry into the matter. As a result of the investigation by the Civil Division, the Company’s financial statements for the first quarter of 2022 included a $ 1,850,000 1,787,417 63,000 53,000 Jerald Hammann As previously disclosed in our Annual Report on Form 10-K for the year ended December 31, 2021, and in our subsequent Quarterly Reports on Form 10-Q for the first two quarters of 2022, on June 8, 2021, Jerald Hammann filed a complaint against the Company and each of its directors in the Court of Chancery of the State of Delaware, captioned Jerald Hammann v. Adamis Pharmaceuticals Corporation et al. The Company records accruals for loss contingencies associated with legal matters when the Company determines it is probable that a loss has been or will be incurred and the amount of the loss can be reasonably estimated. Where a material loss contingency is reasonably possible and the reasonably possible loss or range of possible loss can be reasonably estimated, U.S. GAAP requires us to disclose an estimate of the reasonably possible loss or range of loss or make a statement that such an estimate cannot be made. Nasdaq Compliance On December 31, 2021, we received a notice from the Nasdaq Listing Qualifications Department of The NASDAQ Capital Market (“Nasdaq”) informing us that because the closing bid price of our common stock had been below $ 1.00 30 1.00 30 180 1.00 10 180 180 180 1.00 10 180 |
Stock Transactions
Stock Transactions | 9 Months Ended |
Sep. 30, 2022 | |
Equity [Abstract] | |
Stock Transactions | Note 10: Stock Transactions Commons Stock Transactions: In January and February 2021, the Company issued common stock upon exercise of investor warrants. The warrant holders exercised for cash at exercise prices ranging from $ 0.70 1.15 5,852,000 8,356,000 On February 2, 2021, the Company completed the closing of an underwritten public offering of 46,621,621 1.11 6,081,081 48.4 3.3 Preferred Stock Transaction On July 5, 2022, the Company entered into a private placement transaction with Lincoln Park Capital Fund, LLC, (or, "Lincoln Park") pursuant to which the Company issued an aggregate of 3,000 0.0001 750,000 0.47 300,000 15,000 January 3, 2023 January 5, 2028 The Series C Preferred is entitled to dividends, on an as-if converted basis, equal to and in the same form as dividends actually paid on shares of common stock, when, as and if actually paid on shares of common stock (subject to adjustments pursuant to the related Certificate of Designation.) The Series C Preferred will have no voting rights (other than the right to vote as a class on certain matters as provided in the related Certificate of Designation). However, each share of Series C Preferred entitles the holder thereof (i) to vote exclusively on the Proposal (as defined in the related documents) and any proposal to adjourn any meeting of stockholders called for the purpose of voting on the Proposal, and (ii) to 1,000,000 votes per each share of Series C Preferred The Series C Preferred shall, except as required by law, vote together with the common stock and any other issued and outstanding shares of preferred stock of the Company entitled to vote, as a single class; provided, however, that such shares of Series C Preferred shall, to the extent cast on the Proposal, be automatically and without further action of the holders thereof voted in the same proportion as shares of common stock (excluding any shares of common stock that are not voted) and any other issued and outstanding shares of preferred stock of the Company entitled to vote (other than the Series C Preferred or shares of such preferred stock not voted) are voted on the Proposal and any proposal to adjourn any meeting of stockholders called for the purpose of voting on the Proposal. The Series C Preferred has a “Stated Value” of $ 100 110 The Series C Preferred is convertible into shares of common stock at the option of the holder, any time after the effective date of a reverse stock split of the outstanding shares of the Common Stock at a ratio set forth in a reverse stock split proposal by means of an amendment to the Company’s certificate of incorporation approved by the board of directors and the stockholders of the Company (a “Reverse Stock Split”), into that number of shares common stock (subject to certain beneficial ownership limitations applicable to each holder, and to compliance with the rules and regulations of the Nasdaq Capital Market) determined by dividing the Stated Value of such share of Series C Preferred by the conversion price then in effect, rounded down to the nearest whole share (with cash paid in lieu of any fractional shares). The conversion price for the Series C Preferred equals 90 0.60 0.43 3,000 697,674 110 105 The Company determined that the Series C Preferred should be classified as mezzanine equity (temporary equity outside of permanent equity), that the Series C Preferred more closely aligned with debt as the intent is for redemption by either the holder or issuer, mostly likely the issuer (the Company) due to the more favorable redemption terms. The embedded conversion feature was determined to meet the derivative scope exception. The Company did not separately account for the redemption features as the fair value of such feature is not material. The Warrants are freestanding and detachable; and the Company determined that the warrants meet the criteria for equity classification in the Company’s consolidated balance sheet. With the equity classification of both the Series C Preferred and the warrants, the $ 15,000 Fair value for both the Series C Preferred and the related warrants were based on significant inputs that were unobservable and thus represented Level 3 measurements. Fair value for the Series C Preferred was based on the weighted value of the Reverse Stock Split approval and the value of the Reverse Stock Split rejection times the probability of each scenario as assessed by management at the time of the Series C Preferred stock issuance. Fair value of the Warrants was based on the Black-Scholes pricing model, using the following inputs: $ 0.53 0.47 5.5 70 0 2.82 157,300 127,700 Subsequent to the issuance of the Series C Preferred, in connection with the Company’s annual meeting of stockholders, in September 2022 the Company’s stockholders voted on a reverse stock split proposal, and the proposal was not approved. Pursuant to the Series C Preferred transaction agreements, at September 30, 2022, in the consolidated balance sheet, the Company accrued $ 15,000 750,000 |
Stock-based Compensation, Warra
Stock-based Compensation, Warrants and Shares Reserved | 9 Months Ended |
Sep. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-based Compensation, Warrants and Shares Reserved | Note 11: Stock-based Compensation, Warrants and Shares Reserved The Company accounts for stock-based compensation transactions in which the Company receives employee services in exchange for restricted stock units (“RSUs”) or options to purchase common stock and the Company recognizes stock-based compensation cost as expense ratably on a straight-line basis over the requisite service period. Stock-based compensation cost for RSUs is measured based on the closing fair market value of the Company’s common stock on the date of grant. Stock-based compensation cost for stock options is estimated at the grant date based on each option’s fair-value as calculated by the Black-Scholes option-pricing model. The Company accounts for forfeitures as they occur and will reduce compensation cost at the time of forfeiture. Cash-settled Stock Appreciation Rights (“SARs”) provide for the cash payment of the excess of the fair market value of the Company’s common stock price on the date of exercise over the grant price. The fair value of the SARs is calculated during each reporting period and estimated using the Black-Scholes option pricing model. The SARs will vest over a period of three years At the Company’s 2020 annual meeting of stockholders, the stockholders approved the Company’s 2020 Equity Incentive Plan (the “2020 Plan”). The 2020 Plan provides for the grant of incentive stock options, non-statutory stock options, restricted stock awards, restricted stock unit awards, stock appreciation rights, performance stock awards, and other forms of equity compensation (collectively “stock awards”). In addition, the 2020 Plan provides for the grant of cash awards. The initial aggregate number of shares of common stock that may be issued pursuant to stock awards under the 2020 Plan is 2,000,000 5.0 3.00 ten On January 1, 2022, pursuant to the 2020 Equity Incentive Plan the number of shares reserved for the issuance of stock awards increased by 7,479,713 In June 2022, the Company issued 250,000 540,000 Stock Options The following table summarizes the stock option activity for the nine months ended September 30, 2022: 2009 Equity Incentive Plan: 2009 Weighted-Average Weighted-Average Total Outstanding Vested and Expected to Vest as of December 31, 2021 4,985,415 $ 4.21 4.05 Options Canceled/Expired (679,053 ) — — Total Outstanding Vested and Expected to Vest as of September 30, 2022 4,306,362 $ 4.21 2.88 Vested at September 30, 2022 4,301,429 $ 4.21 2.88 Non-Plan Awards: Non-Plan Weighted-Average Weighted-Average Total Outstanding Vested and Expected to Vest as of December 31, 2021 — $ — — Granted 130,000 0.62 9.38 Options Canceled/Expired — — — Total Outstanding Vested and Expected to Vest as of September 30, 2022 130,000 $ 0.62 9.38 Vested at September 30, 2022 46,666 $ 0.62 9.38 As of September 30, 2022, the compensation expense related to stock options issued under the Company’s 2009 Equity Incentive Plan has been fully recognized. The aggregate intrinsic value (the difference between the Company’s closing stock price on the last trading day of the year and the exercise price, multiplied by the number of in-the-money options) of all options outstanding at September 30, 2022 and 2021 was $ 0 Restricted Stock Units The following summarizes the restricted stock unit activity for the nine months ended September 30, 2022 below: Number of Shares/Units Weighted Average Grant Date Fair Value Non-vested RSUs as of December 31, 2021 1,039,003 $ 4.16 RSUs vested during the period (389,003 ) $ 3.35 Non-vested RSUs as of September 30, 2022 650,000 $ 4.64 As of September 30, 2022, the unamortized compensation expense related to RSUs was approximately $ 366,000 1.17 Total Stock-Based Compensation: Stock-based compensation recognized as selling, general and administrative costs (or, SG&A) for three months ended September 30, 2022 and 2021, was approximately $ 71,000 (59,000) Stock-based compensation recognized as research and development costs (or, R&D) for three months ended September 30, 2022 and 2021, was approximately $ 4,000 212,000 Stock-based compensation recognized as SG&A for nine months ended September 30, 2022 and 2021, was approximately $ (137,000) 1,012,000 Stock-based compensation recognized as R&D for nine months ended September 30, 2022 and 2021, was approximately $ 123,000 818,000 Warrants The following table summarizes warrants outstanding at September 30, 2022 September 30, 2022 Warrant Exercise Price Date Expiration Old Adamis Warrants 58,824 $ 8.50 November 15, 2007 November 15, 2023 2019 Warrants 13,794,000 $ 1.15 August 5, 2019 August 5, 2024 2020 Warrants 350,000 * $ 0.70 February 25, 2020 September 3, 2025 Series C Preferred Warrants 750,000 $ 0.47 July 5, 2022 January 5, 2028 Total Warrants 14,952,824 * All of the Company’s warrants are equity classified, except for the 2020 Warrants that are liability classified. See Note 8. At September 30, 2022, the Company has reserved shares of common stock for issuance upon exercise of outstanding options, warrants including all of the warrants in the table above, restricted stock units and convertible preferred stock, as follows Warrants 14,952,824 Convertible Preferred Stock 697,674 RSU 650,000 Non-Plan Awards 130,000 2009 Equity Incentive Plan 4,306,362 Total Shares Reserved 20,736,860 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 12: Commitments and Contingencies The Company has a production threshold commitment to a manufacturer of our SYMJEPI products pursuant to which the Company would be required to pay for maintenance fees if it does not meet certain periodic purchase order minimums. Any such maintenance fees would be prorated as a percentage of the required minimum production threshold. There were no maintenance fees recorded as of September 30, 2022 and 2021. For information concerning contingencies relating to legal proceedings, see Note 9 of the notes to the condensed consolidated financial statements. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2022 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 13: Subsequent Events Officer Resignation On October 1, 2022, Ronald B. Moss, M.D., the Chief Medical Officer of the Company, resigned as an officer and employee of the Company effective October 14, 2022. Strategic Review On October 3, 2022, the Company announced that following the previously announced halting of the Company’s Phase 2/3 clinical trial examining the effects of Tempol in high risk subjects with early COVID-19 infection, it has initiated a process to explore a range of strategic and financing alternatives focused on maximizing stockholder value. Potential alternatives that may be explored or evaluated include a partnership or other agreements regarding or sale of one or both of the Company’s commercial products SYMJEPI® and ZIMHI®, a merger, sale, or reverse merger of the Company, and/or seeking additional financing. As part of this process, the Company has engaged the investment bank Raymond James & Associates, Inc. to act as strategic advisor to assist the Company in evaluating certain alternatives. As of the date of this Report, we are presently engaged in communications with third parties regarding this process concerning one or more possible transactions. There can be no assurance regarding the schedule for completion of the strategic review process, that this strategic review process will result in the Company pursuing any transaction or that any transaction, if pursued, will be completed. The process of obtaining funding, or the terms of a strategic transaction, could result in significant dilution to our existing stockholders. The Company is also reviewing and implementing expense reduction alternatives and measures including, without limitation, employee headcount reductions and reduction or discontinuation of certain product development programs. |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Going Concern | Going Concern The Company’s cash and cash equivalents were $ 2,419,960 23,220,770 The condensed consolidated financial statements were prepared under the assumption that the Company will continue our operations as a going concern, which contemplates the realization of assets and the satisfaction of liabilities during the normal course of business. In preparing these condensed consolidated financial statements, consideration was given to the Company’s future business as described below, which may preclude the Company from realizing the value of certain assets. The Company has significant operating cash flow deficiencies. Additionally, the Company will need additional funding in the near term and thereafter in the future to sustain operations, satisfy existing and future obligations and liabilities, and otherwise support the Company’s operations and business activities and working capital needs. The preceding conditions raise substantial doubt about the Company’s ability to continue as a going concern. The condensed consolidated financial statements for the nine months ended September 30, 2022, were prepared under the assumption that we would continue our operations as a going concern, which contemplates the realization of assets and the satisfaction of liabilities during the normal course of business. Our unaudited condensed consolidated financial statements do not include any adjustments that may result from the outcome of this uncertainty. Management’s plans include attempting to secure additional required funding through equity or debt financings if available, seeking to enter into one or more strategic agreements regarding, or sales or out-licensing of, intellectual property or other assets, products, product candidates or technologies, seeking to enter into agreements with third parties to co-develop and fund research and development efforts, revenues from existing agreements, a merger, sale or reverse merger of the Company, or other strategic transaction. There is no assurance that the Company will be successful in obtaining the necessary funding to sustain its operations or meet its business objectives. The process of obtaining funding, or the terms of a strategic transaction, could result in significant dilution to our existing stockholders. In addition, a severe or prolonged economic downturn, political disruption or pandemic, such as the COVID-19 pandemic, could result in a variety of risks to our business, including our ability to raise capital when needed on acceptable terms, if at all. |
Basic and Diluted Loss per Share | Basic and Diluted Loss per Share Under ASC 260, the Company is required to apply the two-class method to compute earnings per share (or, EPS). Under the two-class method both basic and diluted EPS are calculated for each class of common stock and participating security considering both dividends declared (or accumulated) and participation rights in undistributed earnings. The two-class method results in an allocation of all undistributed earnings as if all those earnings were distributed. Considering the Company has generated losses in each reporting period since its inception through September 30, 2022, the Company also considered the guidance related to the allocation of the undistributed losses under the two-class method. The contractual rights and obligations of the preferred stock shares were evaluated to determine if they have an obligation to share in the losses of the Company. As there is no obligation for the preferred stock shareholders to fund the losses of the Company nor is the contractual principal or mandatory redemption amount of the preferred stock shares reduced as a result of losses incurred by the Company, under the two-class method, the undistributed losses will be allocated entirely to the common stock securities. The Company computes basic loss per share by dividing the loss attributable to holders of common stock for the period by the weighted average number of shares of common stock outstanding during the period. The diluted loss per share calculation is based on the if-converted method for convertible preferred shares and gives effect to dilutive if-converted shares and the treasury stock method and gives effect to dilutive options, warrants and other potentially dilutive common stock. The preferred stock, however, is not considered potentially dilutive due to the contingency on the conversion feature not being tied to stock price or price of the convertible instrument. The common stock equivalents were anti-dilutive and were excluded from the calculation of weighted average shares outstanding. Potentially dilutive securities, which are not included in diluted weighted average shares outstanding for the nine months ended September 30, 2022 and September 30, 2021, consist of outstanding warrants covering 14,952,824 14,202,824 4,436,362 5,844,239 650,000 1,747,124 |
Discontinued Operations | Discontinued Operations In accordance with ASC 205-20 Presentation of Financial Statements: Discontinued Operations |
Recent Accounting Pronouncement | Recent Accounting Pronouncement In May 2021, the FASB issued ASU No. 2021-04, Earnings Per Share (Topic 260), Debt—Modifications and Extinguishments (Subtopic 470-50), Compensation—Stock Compensation (Topic 718), and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options |
Discontinued Operations and A_2
Discontinued Operations and Assets Held for Sale (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
DISCONTINUED OPERATIONS | |
The major assets and liabilities associated with discontinued operations included in our consolidated balance sheets are as follows (unaudited): | The major assets and liabilities associated with discontinued operations included in our consolidated balance sheets are as follows (unaudited): Carrying amounts of major classes of assets included as part of discontinued operations (unaudited): September 30, December 31 Carrying amounts of major classes of assets included as part of discontinued operations Cash and Cash Equivalents $ 1,928 $ 37,849 Accounts Receivable, net — 693 Inventories — 12,000 Fixed Assets, net 6,779,252 6,799,090 Other Assets 8,501 72,469 Loss recognized on classification as held for sale (2,601,442 ) (2,601,442 ) Total assets of the disposal group classified as discontinued operations in the statement of financial position $ 4,188,239 $ 4,320,659 Carrying amounts of major classes of liabilities included as part of discontinued operations Accounts Payable 621,466 681,646 Accrued Other Expenses 67,183 133,313 Lease Liabilities 285,346 412,357 Contingent Loss Liability 410,000 410,000 Deferred Tax Liability 45,930 45,930 Total liabilities of the disposal group classified as discontinued operations in the statement of financial position $ 1,429,925 $ 1,683,246 |
The revenues and expenses associated with discontinued operations included in our condensed consolidated statements of operations were as follows (unaudited): | The revenues and expenses associated with discontinued operations included in our condensed consolidated statements of operations were as follows (unaudited): Three Months Ended 2022 2021 Major line items constituting pretax loss of discontinued operations REVENUE, net $ — $ 705,143 COST OF GOODS SOLD — (1,882,558 ) Gross Loss — (1,177,415 ) SELLING, GENERAL AND ADMINISTRATIVE EXPENSES (125,722 ) (2,457,162 ) RESEARCH AND DEVELOPMENT — (42,076 ) Impairment Expense – Intangible Assets — (3,835,158 ) Impairment Expense – Goodwill — (868,412 ) Impairment Expense – Inventory — (837,414 ) Impairment Expense – Right of Use Asset — (448,141 ) Loss from Held for Sale Classification — (2,177,844 ) (125,722 ) (11,843,622 ) OTHER INCOME (EXPENSE) Interest Income 22 8,619 Gain on Sale of Assets to Fagron — 4,636,702 Loss on Disposal of Assets (1,992 ) — Other Income — 5,659 Net Loss from discontinued operations before income taxes $ (127,692 ) $ (7,192,642 ) Nine Months Ended 2022 2021 Major line items constituting pretax loss of discontinued operations REVENUE, net $ — $ 6,216,826 COST OF GOODS SOLD — (5,753,658 ) — 463,168 SELLING, GENERAL AND ADMINISTRATIVE EXPENSES (390,105 ) (7,055,739 ) RESEARCH AND DEVELOPMENT — (89,710 ) Impairment Expense – Intangible — (3,835,158 ) Impairment Expense – Goodwill — (868,412 ) Impairment Expense – Inventory — (837,414 ) Impairment Expense – Right of Use Asset — (448,141 ) Impairment Expense – Fixed Assets — (9,346 ) Loss from Held for Sale Classification — (2,177,844 ) (390,105 ) (14,858,596 ) OTHER INCOME (EXPENSE) Interest Expense — (70,903 ) Interest Income 34 34 Gain on Sale of Assets to Fagron — 4,636,702 Gain on Disposal of Assets 27,138 Other Income 8,613 26,398 Net Loss from discontinued operations before income taxes $ (354,320 ) $ (10,266,365 ) |
Inventories (Tables)
Inventories (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Inventory Disclosure [Abstract] | |
Inventories at September 30, 2022 and December 31, 2021 consisted of the following: | Inventories at September 30, 2022 and December 31, 2021 consisted of the following: September 30, December 31, Work-in-Process $ 386,827 $ 386,610 Raw Materials 705,618 31,997 Inventories $ 1,092,445 $ 418,607 |
Fixed Assets, net (Tables)
Fixed Assets, net (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Property, Plant and Equipment [Abstract] | |
Fixed Assets, net at September 30, 2022 and December 31, 2021 are summarized in the table below: | Fixed Assets, net at September 30, 2022 and December 31, 2021 are summarized in the table below: Description Useful Life (Years) September 30, December 31, Machinery and Equipment 3 7 $ 5,224,025 $ 4,522,583 Less: Accumulated Depreciation (4,293,062 ) (3,181,567 ) Construction In Progress - Equipment 663,893 993,752 Fixed Assets, net $ 1,594,856 $ 2,334,768 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Leases | |
The Company’s weighted average remaining lease term and weighted average discount rate for operating and financing leases as of September 30, 2022 and December 31, 2021 were: | The Company’s weighted average remaining lease term and weighted average discount rate for operating and financing leases as of September 30, 2022 and December 31, 2021 were: September 30, 2022 Operating Weighted Average Remaining Lease Term 1.17 Weighted Average Discount Rate 3.95 December 31, 2021 Operating Weighted Average Remaining Lease Term 1.92 Weighted Average Discount Rate 3.95 |
The table below reconciles the undiscounted future minimum lease payments (displayed by year and in the aggregate) under non-cancelable leases with terms of more than one year to the total lease liabilities recognized on the unaudited condensed consolidated balance sheets as of September 30, 2022: | The table below reconciles the undiscounted future minimum lease payments (displayed by year and in the aggregate) under non-cancelable leases with terms of more than one year to the total lease liabilities recognized on the unaudited condensed consolidated balance sheets as of September 30, 2022: Year Ending December 31, Operating Remainder of 2022 $ 93,431 2023 349,365 Undiscounted Future Minimum Lease Payments 442,796 Less: Difference between undiscounted lease payments and discounted lease liabilities 10,778 Total Lease Liabilities $ 432,018 Short-Term Lease Liabilities $ 368,809 Long-Term Lease Liabilities $ 63,209 |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
The following table sets forth the Company’s financial instruments that were measured at fair value on a recurring basis by level within the fair value hierarchy: | The following table sets forth the Company’s financial instruments that were measured at fair value on a recurring basis by level within the fair value hierarchy: Fair Value Measurements at September 30, 2022 Total Level 1 Level 2 Level 3 Liabilities 2020 Warrant liability $ 12,037 $ — $ — $ 12,037 The fair value measurement of the warrants issued by the Company in February 2020 (the “2020 Warrants”) are based on significant inputs that are unobservable and thus represents a Level 3 measurement. The Company’s estimated fair value of the Warrant liability is calculated using the Black Scholes Option Pricing Model. Key assumptions at September 30, 2022 include the expected volatility of the Company’s stock of approximately 70 0.199 0.0 2.93 4.255 Fair Value Measurements at December 31, 2021 Total Level 1 Level 2 Level 3 Liabilities 2020 Warrant liability $ 99,655 $ — $ — $ 99,655 |
The following table sets forth a summary of changes in the fair value of the Company's Level 3 financial instruments, which are treated as liabilities, as follows: | The following table sets forth a summary of changes in the fair value of the Company's Level 3 financial instruments, which are treated as liabilities, as follows: 2020 Warrant Number of Liability Balance at December 31, 2021 350,000 $ 99,655 Change in Fair Value, March 31, 2022 — (9,387) Change in Fair Value, June 30, 2022 — (19,540) Change in Fair Value, September 30, 2022 — (58,690) Balance at September 30, 2022 350,000 $ 12,037 |
Stock-based Compensation, War_2
Stock-based Compensation, Warrants and Shares Reserved (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
The following table summarizes the stock option activity for the nine months ended September 30, 2022: | The following table summarizes the stock option activity for the nine months ended September 30, 2022: 2009 Equity Incentive Plan: 2009 Weighted-Average Weighted-Average Total Outstanding Vested and Expected to Vest as of December 31, 2021 4,985,415 $ 4.21 4.05 Options Canceled/Expired (679,053 ) — — Total Outstanding Vested and Expected to Vest as of September 30, 2022 4,306,362 $ 4.21 2.88 Vested at September 30, 2022 4,301,429 $ 4.21 2.88 Non-Plan Awards: Non-Plan Weighted-Average Weighted-Average Total Outstanding Vested and Expected to Vest as of December 31, 2021 — $ — — Granted 130,000 0.62 9.38 Options Canceled/Expired — — — Total Outstanding Vested and Expected to Vest as of September 30, 2022 130,000 $ 0.62 9.38 Vested at September 30, 2022 46,666 $ 0.62 9.38 |
The following summarizes the restricted stock unit activity for the nine months ended September 30, 2022 below: | The following summarizes the restricted stock unit activity for the nine months ended September 30, 2022 below: Number of Shares/Units Weighted Average Grant Date Fair Value Non-vested RSUs as of December 31, 2021 1,039,003 $ 4.16 RSUs vested during the period (389,003 ) $ 3.35 Non-vested RSUs as of September 30, 2022 650,000 $ 4.64 |
The following table summarizes warrants outstanding at September 30, 2022: | The following table summarizes warrants outstanding at September 30, 2022 September 30, 2022 Warrant Exercise Price Date Expiration Old Adamis Warrants 58,824 $ 8.50 November 15, 2007 November 15, 2023 2019 Warrants 13,794,000 $ 1.15 August 5, 2019 August 5, 2024 2020 Warrants 350,000 * $ 0.70 February 25, 2020 September 3, 2025 Series C Preferred Warrants 750,000 $ 0.47 July 5, 2022 January 5, 2028 Total Warrants 14,952,824 * All of the Company’s warrants are equity classified, except for the 2020 Warrants that are liability classified. See Note 8. |
At September 30, 2022, the Company has reserved shares of common stock for issuance upon exercise of outstanding options, warrants including all of the warrants in the table above, restricted stock units and convertible preferred stock, as follows: | At September 30, 2022, the Company has reserved shares of common stock for issuance upon exercise of outstanding options, warrants including all of the warrants in the table above, restricted stock units and convertible preferred stock, as follows Warrants 14,952,824 Convertible Preferred Stock 697,674 RSU 650,000 Non-Plan Awards 130,000 2009 Equity Incentive Plan 4,306,362 Total Shares Reserved 20,736,860 |
Basis of Presentation (Details
Basis of Presentation (Details Narrative) - USD ($) | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Cash and cash equivalents | $ 2,419,960 | $ 28,731,894 | $ 23,220,770 |
Warrant [Member] | |||
Potential dilutive securities, excluded from computation of earnings | 14,952,824 | 14,202,824 | |
Share-Based Payment Arrangement, Option [Member] | |||
Potential dilutive securities, excluded from computation of earnings | 4,436,362 | 5,844,239 | |
Restricted Stock Units (RSUs) [Member] | |||
Potential dilutive securities, excluded from computation of earnings | 650,000 | 1,747,124 |
The major assets and liabilitie
The major assets and liabilities associated with discontinued operations included in our consolidated balance sheets are as follows (unaudited): (Details) - USD ($) | Sep. 30, 2022 | Dec. 31, 2021 |
Carrying amounts of major classes of assets included as part of discontinued operations | ||
Cash and Cash Equivalents | $ 1,928 | $ 37,849 |
Accounts Receivable, net | 693 | |
Inventories | 12,000 | |
Fixed Assets, net | 6,779,252 | 6,799,090 |
Other Assets | 8,501 | 72,469 |
Loss recognized on classification as held for sale | (2,601,442) | (2,601,442) |
Total assets of the disposal group classified as discontinued operations in the statement of financial position | 4,188,239 | 4,320,659 |
Carrying amounts of major classes of liabilities included as part of discontinued operations | ||
Accounts Payable | 621,466 | 681,646 |
Accrued Other Expenses | 67,183 | 133,313 |
Lease Liabilities | 285,346 | 412,357 |
Contingent Loss Liability | 410,000 | 410,000 |
Deferred Tax Liability | 45,930 | 45,930 |
Total liabilities of the disposal group classified as discontinued operations in the statement of financial position | $ 1,429,925 | $ 1,683,246 |
The revenues and expenses assoc
The revenues and expenses associated with discontinued operations included in our condensed consolidated statements of operations were as follows (unaudited): (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Major line items constituting pretax loss of discontinued operations | ||||
REVENUE, net | $ 705,143 | $ 6,216,826 | ||
COST OF GOODS SOLD | (1,882,558) | (5,753,658) | ||
(1,177,415) | 463,168 | |||
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES | (125,722) | (2,457,162) | (390,105) | (7,055,739) |
RESEARCH AND DEVELOPMENT | (42,076) | (89,710) | ||
Impairment Expense – Intangible | (3,835,158) | (3,835,158) | ||
Impairment Expense – Goodwill | (868,412) | (868,412) | ||
Impairment Expense – Inventory | (837,414) | (837,414) | ||
Impairment Expense – Right of Use Asset | (448,141) | (448,141) | ||
Impairment Expense – Fixed Assets | (9,346) | |||
Loss from Held for Sale Classification | (2,177,844) | (2,177,844) | ||
(125,722) | (11,843,622) | (390,105) | (14,858,596) | |
OTHER INCOME (EXPENSE) | ||||
Interest Income | 22 | 8,619 | 34 | 34 |
Interest Expense | (70,903) | |||
Gain on Sale of Assets to Fagron | 4,636,702 | 4,636,702 | ||
Gain (Loss) on Disposal of Assets | (1,992) | 27,138 | ||
Other Income | 5,659 | 8,613 | 26,398 | |
Net Loss from discontinued operations before income taxes | $ (127,692) | $ (7,192,642) | $ (354,320) | $ (10,266,365) |
Discontinued Operations and A_3
Discontinued Operations and Assets Held for Sale (Details Narrative) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Jan. 31, 2022 USD ($) | Sep. 30, 2022 USD ($) | Sep. 30, 2021 USD ($) | Sep. 30, 2022 USD ($) Lease | Sep. 30, 2021 USD ($) | Dec. 31, 2021 USD ($) | Aug. 31, 2021 USD ($) | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Transaction fee paid | $ 700,000 | ||||||
Impairment of right-of-use assets | $ 448,141 | $ 448,141 | |||||
Lease liabilities | 285,346 | 285,346 | $ 412,357 | ||||
Contingent loss liability | 410,000 | $ 410,000 | 410,000 | ||||
Contract Termination [Member] | Discontinued Operations [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Contingent loss liability | 410,000 | ||||||
US Compounding, Inc. [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Standard payment terms | The standard payment terms were 2%/10 and Net 30. | ||||||
Number of operating leases | Lease | 2 | ||||||
Impairment of right-of-use assets | 448,000 | ||||||
Lease liabilities | $ 285,000 | $ 285,000 | $ 412,000 | ||||
Debt payment frequency | monthly | ||||||
Debt Instrument, Periodic Payment | $ 19,000 | ||||||
Interest rate | 6% | 6% | |||||
Interest expense | $ 0 | $ 0 | $ 0 | $ 71,000 | |||
US Compounding, Inc. [Member] | Minimum [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Remaining lease term | 1 year | 1 year | |||||
US Compounding, Inc. [Member] | Maximum [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Remaining lease term | 4 years | 4 years | |||||
US Compounding, Inc. [Member] | Office Space [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Number of operating leases | Lease | 1 | ||||||
US Compounding, Inc. [Member] | Office Equipment [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Number of operating leases | Lease | 1 | ||||||
US Compounding, Inc. [Member] | Building [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Monthly base rent | $ 10,824 | ||||||
Lease expiration date | Dec. 31, 2023 | ||||||
Fagron Compounding Services LLC [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Consideration for assets sold | $ 107,000 | ||||||
Variable consideration | $ 6,385,000 | ||||||
Increase (decrease) in variable consideration | $ 278,000 | $ (919,000) |
Revenues (Details Narrative)
Revenues (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | 9 Months Ended | ||||
Mar. 21, 2022 | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Recall expense | $ 2,000,000 | $ 388,000 | $ 2,400,000 | ||||
Product recall liability | 408,000 | 408,000 | $ 408,000 | $ 2,000,000 | |||
Revenues recognized previously reported as deferred revenue | 587,000 | $ 25,000 | 587,000 | $ 75,000 | |||
Increase in recognition of deferred revenue | 562,000 | $ 562,000 | |||||
Uswm Agreement [Member] | |||||||
Term of agreement | 10 years | ||||||
Agreements renewal terms | 5 years | ||||||
Sandoz Agreement [Member] | Sandoz [Member] | |||||||
Deferred Revenue | $ 213,000 | $ 213,000 | $ 213,000 | $ 850,000 |
Inventories at September 30, 20
Inventories at September 30, 2022 and December 31, 2021 consisted of the following: (Details) - USD ($) | Sep. 30, 2022 | Dec. 31, 2021 |
Inventory Disclosure [Abstract] | ||
Work-in-Process | $ 386,827 | $ 386,610 |
Raw Materials | 705,618 | 31,997 |
Inventories | $ 1,092,445 | $ 418,607 |
Fixed Assets, net at September
Fixed Assets, net at September 30, 2022 and December 31, 2021 are summarized in the table below: (Details) - USD ($) | 9 Months Ended | |
Sep. 30, 2022 | Dec. 31, 2021 | |
Property, Plant and Equipment [Line Items] | ||
Machinery and Equipment | $ 5,224,025 | $ 4,522,583 |
Less: Accumulated Depreciation | (4,293,062) | (3,181,567) |
Construction In Progress - Equipment | 663,893 | 993,752 |
Fixed Assets, net | $ 1,594,856 | $ 2,334,768 |
Machinery and Equipment [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Fixed assets, useful lives | 3 years | |
Machinery and Equipment [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Fixed assets, useful lives | 7 years |
Fixed Assets, net (Details Narr
Fixed Assets, net (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Property, Plant and Equipment [Abstract] | ||||
Depreciation | $ 399,000 | $ 375,000 | $ 1,111,495 | $ 1,071,830 |
Leases (Details Narrative)
Leases (Details Narrative) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 USD ($) | Sep. 30, 2021 USD ($) | Sep. 30, 2022 USD ($) Lease | Sep. 30, 2021 USD ($) | |
Lessee, Lease, Description [Line Items] | ||||
Operating lease expense | $ 88,000 | $ 88,000 | $ 265,000 | $ 265,000 |
Cash paid operating lease | $ 93,000 | $ 90,000 | $ 278,000 | $ 269,000 |
Office [Member] | ||||
Lessee, Lease, Description [Line Items] | ||||
Number of operating leases | Lease | 1 | |||
Remaining lease term | 14 months | 14 months |
The Company_s weighted average
The Company’s weighted average remaining lease term and weighted average discount rate for operating and financing leases as of September 30, 2022 and December 31, 2021 were: (Details) | Sep. 30, 2022 | Dec. 31, 2021 |
Leases | ||
Weighted average remaining lease term | 1 year 2 months 1 day | 1 year 11 months 1 day |
Weighted average discount rate | 3.95% | 3.95% |
The table below reconciles the
The table below reconciles the undiscounted future minimum lease payments (displayed by year and in the aggregate) under non-cancelable leases with terms of more than one year to the total lease liabilities recognized on the unaudited condensed consolidat (Details) - USD ($) | Sep. 30, 2022 | Dec. 31, 2021 |
Leases | ||
Remainder of 2022 | $ 93,431 | |
2023 | 349,365 | |
Undiscounted Future Minimum Lease Payments | 442,796 | |
Less: Difference between undiscounted lease payments and discounted lease liabilities | 10,778 | |
Total Lease Liabilities | 432,018 | |
Short-Term Lease Liabilities | 368,809 | $ 349,871 |
Long-Term Lease Liabilities | $ 63,209 | $ 342,562 |
Debt (Details Narrative)
Debt (Details Narrative) - USD ($) | 1 Months Ended | 9 Months Ended | ||||
Apr. 13, 2020 | Jun. 30, 2022 | Sep. 30, 2022 | Mar. 31, 2022 | Aug. 05, 2021 | Mar. 15, 2021 | |
Paycheck Protection Plan First Draw Loan [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt amount | $ 0 | |||||
Paycheck Protection Plan Second Draw Loan [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Contingent loss liability | $ 1,850,000 | |||||
Repayment of loan | $ 1,787,417 | |||||
Paycheck Protection Program [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Percentage of loan amount use for eligible costs | 60% | |||||
Paycheck Protection Program [Member] | Promissory Note [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Proceeds from debt | $ 3,191,700 | |||||
Debt amount | $ 3,191,700 | |||||
Interest rate | 1% | |||||
Paycheck Protection Plan Second Draw Loan [Member] | Promissory Note [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt amount | $ 1,765,495 | |||||
Interest rate | 1% |
The following table sets forth
The following table sets forth the Company’s financial instruments that were measured at fair value on a recurring basis by level within the fair value hierarchy: (Details) - Fair Value, Recurring [Member] - Warrants 2020 [Member] - USD ($) | Sep. 30, 2022 | Dec. 31, 2021 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
2020 Warrant liability | $ 12,037 | $ 99,655 |
Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
2020 Warrant liability | ||
Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
2020 Warrant liability | ||
Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
2020 Warrant liability | $ 12,037 | $ 99,655 |
The following table sets fort_2
The following table sets forth a summary of changes in the fair value of the Company's Level 3 financial instruments, which are treated as liabilities, as follows: (Details) - USD ($) | 3 Months Ended | ||||
Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | ||
Class of Warrant or Right [Line Items] | |||||
Number of warrants | 14,952,824 | ||||
Warrants 2020 [Member] | |||||
Class of Warrant or Right [Line Items] | |||||
Number of warrants | 350,000 | [1] | 350,000 | ||
Liability | $ 12,037 | $ 99,655 | |||
Change in fair value | $ (58,690) | $ (19,540) | $ (9,387) | ||
[1]All of the Company’s warrants are equity classified, except for the 2020 Warrants that are liability classified. See Note 8. |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments (Details Narrative) | Sep. 30, 2022 $ / shares yr | Dec. 31, 2021 $ / shares yr |
Measurement Input, Price Volatility [Member] | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Derivative liability measurement input | 0.70 | 0.70 |
Measurement Input, Share Price [Member] | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Derivative liability measurement input | $ / shares | 0.199 | 0.605 |
Measurement Input, Expected Dividend Rate [Member] | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Derivative liability measurement input | 0 | 0 |
Measurement Input, Expected Term [Member] | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Derivative liability measurement input | yr | 2.93 | 3.68 |
Measurement Input, Risk Free Interest Rate [Member] | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Derivative liability measurement input | 0.04255 | 0.01038 |
Legal Matters (Details Narrativ
Legal Matters (Details Narrative) | 1 Months Ended | |||
Jun. 30, 2022 d $ / shares | Dec. 31, 2021 d $ / shares | Jun. 30, 2022 USD ($) $ / shares | Mar. 31, 2022 USD ($) | |
Minimum bid price per share requirement | $ / shares | $ 1 | $ 1 | $ 1 | |
Consecutive business days of noncompliance with rule | d | 30 | |||
Period of calendar days to regain compliance | 180 days | |||
Consecutive business days for compliance with rule | d | 10 | 10 | ||
Additional period of calendar days to regain compliance | 180 days | 180 days | ||
Paycheck Protection Plan Second Draw Loan [Member] | ||||
Contingent loss liability | $ 1,850,000 | |||
Repayment of debt | $ 1,787,417 | |||
Loan processing fee | 53,000 | |||
Paycheck Protection Plan Second Draw Loan [Member] | Previously Reported [Member] | ||||
Loan processing fee waived | $ 63,000 |
Stock Transactions (Details Nar
Stock Transactions (Details Narrative) | 9 Months Ended | ||||
Jul. 05, 2022 USD ($) $ / shares yr shares | Feb. 02, 2021 USD ($) $ / shares shares | Sep. 30, 2022 USD ($) $ / shares shares | Sep. 30, 2021 USD ($) | Dec. 31, 2021 USD ($) $ / shares shares | |
Class of Stock [Line Items] | |||||
Proceeds from warrant exercises | $ 5,851,900 | ||||
Number of shares issued | shares | 46,621,621 | ||||
Offering price (in dollars per share) | $ / shares | $ 1.11 | ||||
Proceeds from issuance of common stock | 48,419,246 | ||||
Stock issuance costs | $ 15,000 | ||||
Convertible Preferred Stock, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | |||
Gross proceeds | $ 285,000 | ||||
Fair value of preferred stock | 157,303 | ||||
Accrued liability | $ 15,000 | ||||
Number of warrants outstanding | shares | 14,952,824 | ||||
Series C Preferred Stock [Member] | |||||
Class of Stock [Line Items] | |||||
Number of shares issued | shares | 3,000 | ||||
Convertible Preferred Stock, par value (in dollars per share) | $ / shares | $ 0.0001 | ||||
Gross proceeds | $ 300,000 | ||||
Voting rights | (i) to vote exclusively on the Proposal (as defined in the related documents) and any proposal to adjourn any meeting of stockholders called for the purpose of voting on the Proposal, and (ii) to 1,000,000 votes per each share of Series C Preferred | ||||
Convertible Preferred Stock, stated value (in dollars per share) | $ / shares | $ 100 | ||||
Convertible Preferred Stock, liquidation percentage | 110% | ||||
Convertible Preferred Stock, conversion price percentage | 90% | ||||
Convertible Preferred Stock, conversion price | $ / shares | $ 0.0043 | ||||
Number of shares issued | shares | 3,000 | 3,000 | 0 | ||
Common stock shares issuable upon conversion | shares | 697,674 | ||||
Convertible Preferred Stock, redemption percentage by holder after reverse stock split | 110% | ||||
Convertible Preferred Stock, redemption percentage by issuer after reverse stock split | 105% | ||||
Fair value of preferred stock | $ 157,300 | ||||
Over-Allotment Option [Member] | |||||
Class of Stock [Line Items] | |||||
Number of shares issued | shares | 6,081,081 | ||||
Public Offering [Member] | |||||
Class of Stock [Line Items] | |||||
Proceeds from issuance of common stock | $ 48,400,000 | ||||
Stock issuance costs | 3,300,000 | ||||
Warrant [Member] | |||||
Class of Stock [Line Items] | |||||
Proceeds from warrant exercises | $ 5,852,000 | ||||
Warrants exercised | shares | 8,356,000 | ||||
Series C Preferred Warrants [Member] | |||||
Class of Stock [Line Items] | |||||
Warrants exercise price | $ / shares | $ 0.47 | $ 0.47 | |||
Number of warrants issued | shares | 750,000 | ||||
Warrants exercisable date | Jan. 03, 2023 | ||||
Warramts term end date | Jan. 05, 2028 | Jan. 05, 2028 | |||
Fair value of warrants | $ 127,700 | ||||
Number of warrants outstanding | shares | 750,000 | ||||
Series C Preferred Warrants [Member] | Measurement Input, Share Price [Member] | |||||
Class of Stock [Line Items] | |||||
Warrants measurement input | $ / shares | 0.53 | ||||
Series C Preferred Warrants [Member] | Measurement Input, Exercise Price [Member] | |||||
Class of Stock [Line Items] | |||||
Warrants measurement input | $ / shares | 0.47 | ||||
Series C Preferred Warrants [Member] | Measurement Input, Expected Term [Member] | |||||
Class of Stock [Line Items] | |||||
Warrants measurement input | yr | 5.5 | ||||
Series C Preferred Warrants [Member] | Measurement Input, Price Volatility [Member] | |||||
Class of Stock [Line Items] | |||||
Warrants measurement input | 0.70 | ||||
Series C Preferred Warrants [Member] | Measurement Input, Expected Dividend Rate [Member] | |||||
Class of Stock [Line Items] | |||||
Warrants measurement input | 0 | ||||
Series C Preferred Warrants [Member] | Measurement Input, Risk Free Interest Rate [Member] | |||||
Class of Stock [Line Items] | |||||
Warrants measurement input | 0.0282 | ||||
Minimum [Member] | |||||
Class of Stock [Line Items] | |||||
Warrants exercise price | $ / shares | $ 0.70 | ||||
Maximum [Member] | |||||
Class of Stock [Line Items] | |||||
Warrants exercise price | $ / shares | $ 1.15 | ||||
Maximum [Member] | Series C Preferred Stock [Member] | |||||
Class of Stock [Line Items] | |||||
Convertible Preferred Stock, conversion price | $ / shares | $ 0.0060 |
The following table summarizes
The following table summarizes the stock option activity for the nine months ended September 30, 2022: (Details) | 9 Months Ended |
Sep. 30, 2022 $ / shares shares | |
2009 Equity incentive Plan [Member] | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Total outstanding and vested and expected to vest at beginning | shares | 4,985,415 |
Total outstanding and vested and expected to vest at beginning | $ / shares | $ 4.21 |
Options outstanding, weighted average remaining contractual term at beginning | 4 years 18 days |
Options canceled/expired | shares | (679,053) |
Options canceled/expired, weighted average exercise price | $ / shares | |
Total outstanding and vested and expected to vest at ending | shares | 4,306,362 |
Total outstanding and vested and expected to vest at ending | $ / shares | $ 4.21 |
Options outstanding, weighted average remaining contractual term at ending | 2 years 10 months 17 days |
Vested at ending | shares | 4,301,429 |
Options vested, weighted average exercise price at ending | $ / shares | $ 4.21 |
Options vested, weighted average remaining contractual term | 2 years 10 months 17 days |
Non Plan Awards [Member] | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Total outstanding and vested and expected to vest at beginning | shares | |
Total outstanding and vested and expected to vest at beginning | $ / shares | |
Options granted | shares | 130,000 |
Options granted, weighted average exercise price | $ / shares | $ 0.62 |
Options granted, weighted average remaining contractual term | 9 years 4 months 17 days |
Options canceled/expired | shares | |
Options canceled/expired, weighted average exercise price | $ / shares | |
Total outstanding and vested and expected to vest at ending | shares | 130,000 |
Total outstanding and vested and expected to vest at ending | $ / shares | $ 0.62 |
Options outstanding, weighted average remaining contractual term at ending | 9 years 4 months 17 days |
Vested at ending | shares | 46,666 |
Options vested, weighted average exercise price at ending | $ / shares | $ 0.62 |
Options vested, weighted average remaining contractual term | 9 years 4 months 17 days |
The following summarizes the re
The following summarizes the restricted stock unit activity for the nine months ended September 30, 2022 below: (Details) - Restricted Stock Units (RSUs) [Member] | 9 Months Ended |
Sep. 30, 2022 $ / shares shares | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Non-vested RSUs, beginning | shares | 1,039,003 |
Weighted average grant date fair value, beginning | $ / shares | $ 4.16 |
RSUs vested during the period | shares | (389,003) |
Weighted average grant date fair value, vested | $ / shares | $ 3.35 |
Non-vested RSUs, ending | shares | 650,000 |
Weighted average grant date fair value, ending | $ / shares | $ 4.64 |
The following table summarize_2
The following table summarizes warrants outstanding at September 30, 2022: (Details) - $ / shares | 9 Months Ended | |||
Sep. 30, 2022 | Jul. 05, 2022 | Dec. 31, 2021 | ||
Class of Warrant or Right [Line Items] | ||||
Number of warrants outstanding | 14,952,824 | |||
Old Adamis Warrants [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Number of warrants outstanding | 58,824 | |||
Warrant exercise price (in dollars per share) | $ 8.50 | |||
Date issued | November 15, 2007 | |||
Expiration date | Nov. 15, 2023 | |||
Warrants 2019 [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Number of warrants outstanding | 13,794,000 | |||
Warrant exercise price (in dollars per share) | $ 1.15 | |||
Date issued | August 5, 2019 | |||
Expiration date | Aug. 05, 2024 | |||
Warrants 2020 [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Number of warrants outstanding | 350,000 | [1] | 350,000 | |
Warrant exercise price (in dollars per share) | $ 0.70 | |||
Date issued | February 25, 2020 | |||
Expiration date | Sep. 03, 2025 | |||
Series C Preferred Warrants [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Number of warrants outstanding | 750,000 | |||
Warrant exercise price (in dollars per share) | $ 0.47 | $ 0.47 | ||
Date issued | July 5, 2022 | |||
Expiration date | Jan. 05, 2028 | Jan. 05, 2028 | ||
[1]All of the Company’s warrants are equity classified, except for the 2020 Warrants that are liability classified. See Note 8. |
At September 30, 2022, the Comp
At September 30, 2022, the Company has reserved shares of common stock for issuance upon exercise of outstanding options, warrants including all of the warrants in the table above, restricted stock units and convertible preferred stock, as follows: (Details) | Sep. 30, 2022 shares |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Number of common stock reserved for future issuance | 20,736,860 |
Non Plan Awards [Member] | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Number of common stock reserved for future issuance | 130,000 |
2009 Equity incentive Plan [Member] | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Number of common stock reserved for future issuance | 4,306,362 |
Restricted Stock Units (RSUs) [Member] | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Number of common stock reserved for future issuance | 650,000 |
Convertible Preferred Stock [Member] | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Number of common stock reserved for future issuance | 697,674 |
Warrant [Member] | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Number of common stock reserved for future issuance | 14,952,824 |
Stock-based Compensation, War_3
Stock-based Compensation, Warrants and Shares Reserved (Details Narrative) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||
Jan. 02, 2022 shares | Jun. 30, 2022 USD ($) shares | Sep. 30, 2022 USD ($) | Sep. 30, 2021 USD ($) | Sep. 30, 2022 USD ($) d $ / shares | Sep. 30, 2021 USD ($) | Dec. 31, 2020 shares | Dec. 31, 2021 USD ($) | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||||||
Number of share granted | shares | 250,000 | |||||||
Expense reversal | $ 540,000 | |||||||
Stock-based compensation | $ (14,311) | $ 1,830,402 | ||||||
Selling, General and Administrative Expenses [Member] | ||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||||||
Stock-based compensation | $ 71,000 | $ (59,000) | (137,000) | 1,012,000 | ||||
Research and Development Expense [Member] | ||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||||||
Stock-based compensation | 4,000 | $ 212,000 | $ 123,000 | $ 818,000 | ||||
Equity incentive Plan 2020 [Member] | ||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||||||
Number of shares authorized | shares | 2,000,000 | |||||||
Increase in shares reserved, percentage | 5% | |||||||
Minimum closing price per share requirement for plan awards | $ / shares | $ 3 | |||||||
Threshold consecutive trading days | d | 10 | |||||||
Increase in shares reserved for issuance | shares | 7,479,713 | |||||||
Stock Appreciation Rights (SARs) [Member] | ||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||||||
Vesting period | 3 years | |||||||
Share-Based Payment Arrangement, Option [Member] | ||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||||||
Stock options outstanding aggregate intrinsic value | 0 | $ 0 | $ 0 | |||||
Restricted Stock Units (RSUs) [Member] | ||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||||||
Unrecognized stock compensation | $ 366,000 | $ 366,000 | ||||||
Period for recognition | 1 year 2 months 1 day |