Cover
Cover - USD ($) | 12 Months Ended | ||
Dec. 31, 2022 | Mar. 13, 2023 | Jun. 30, 2022 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Document Period End Date | Dec. 31, 2022 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2022 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity File Number | 000-26372 | ||
Entity Registrant Name | ADAMIS PHARMACEUTICALS CORPORATION | ||
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(g) Security | Common Stock, $0.0001 par value | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 74,359,656 | ||
Entity Common Stock, Shares Outstanding | 149,983,265 | ||
Auditor Firm ID | 243 | ||
Auditor Name | BDO USA, LLP | ||
Auditor Location | San Diego, California |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
CURRENT ASSETS | ||
Cash and Cash Equivalents | $ 1,081,364 | $ 23,220,770 |
Restricted Cash | 30,068 | 30,023 |
Accounts Receivable | 1,054,058 | 815,565 |
Receivable from Fagron | 30,951 | 5,084,452 |
Inventories | 1,238,778 | 418,607 |
Prepaid Expenses and Other Current Assets | 1,884,015 | 1,313,546 |
Current Assets of Discontinued Operations, Note 4 | 3,952,916 | 4,320,659 |
Total Current Assets | 9,272,150 | 35,203,622 |
LONG TERM ASSETS | ||
Fixed Assets, net | 1,288,894 | 2,334,768 |
Right-of-Use Assets | 317,622 | 650,460 |
Other Non-Current Assets | 52,174 | 109,137 |
Total Assets | 10,930,840 | 38,297,987 |
CURRENT LIABILITIES | ||
Accounts Payable | 7,937,493 | 3,754,010 |
Deferred Revenue, current portion | 27,779 | 100,000 |
Accrued Other Expenses | 1,510,053 | 2,800,241 |
Accrued Bonuses | 535,624 | |
Product Recall Liability | 305,806 | 2,000,000 |
Lease Liabilities, current portion | 342,562 | 349,871 |
Current Liabilities of Discontinued Operations, Note 4 | 1,272,173 | 1,683,246 |
Total Current Liabilities | 11,395,866 | 11,222,992 |
LONG TERM LIABILITIES | ||
Deferred Revenue, net of current portion | 178,247 | 750,000 |
Lease Liabilities, net of current portion | 342,562 | |
Warrant Liabilities, at fair value | 7,492 | 99,655 |
Total Liabilities | 11,581,605 | 12,415,209 |
COMMITMENTS AND CONTINGENCIES, see Note 16 | ||
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 December 31, 2022 and 2021, respectively, Note 18 | 157,303 | |
STOCKHOLDERS’ (DEFICIT) EQUITY | ||
Common Stock - Par Value $0.0001; 200,000,000 Shares Authorized; 150,506,222 and 150,117,219 Issued, 149,983,265 and 149,594,262 Outstanding at December 31, 2022 and 2021, respectively. | 15,051 | 15,012 |
Additional Paid-in Capital | 303,746,217 | 303,958,829 |
Accumulated Deficit | (304,564,086) | (278,085,813) |
Treasury Stock, at cost - 522,957 Shares at December 31, 2022 and 2021. | (5,250) | (5,250) |
Total Stockholders’ (Deficit) Equity | (808,068) | 25,882,778 |
Total Liabilities, Mezzanine Equity and Stockholders’ (Deficit) Equity | $ 10,930,840 | $ 38,297,987 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 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 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income Statement [Abstract] | ||
REVENUE, net | $ 4,756,078 | $ 2,208,680 |
COST OF GOODS SOLD | 6,187,486 | 6,872,131 |
Gross Loss | (1,431,408) | (4,663,451) |
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES | 13,247,594 | 16,143,585 |
RESEARCH AND DEVELOPMENT | 10,379,964 | 11,262,373 |
Loss from Operations | (25,058,966) | (32,069,409) |
OTHER INCOME (EXPENSE) | ||
Interest Income (Expense) | 44,126 | (6,649) |
Other Income | 7,216 | |
Loss on Fagron Variable Consideration, net | (962,619) | |
Gain on Insurance Proceeds | 600,000 | |
Gain on Forgiveness of PPP Loans | 5,009,590 | |
Gain on Employee Retention Credit | 875,307 | |
PPP2 Loan Contingent Loss | (1,787,417) | |
Change in Fair Value of Warrant Liabilities | 92,163 | (7,540,305) |
Total Other Income (Expense), net | (1,138,440) | (2,530,148) |
Net Loss from Continuing Operations before Income Taxes | (26,197,406) | (34,599,557) |
Income Tax Expense | (2,000) | (796) |
Net Loss from Continuing Operations | (26,199,406) | (34,600,353) |
DISCONTINUED OPERATIONS | ||
Net Loss from Discontinued Operations before Income Taxes | (278,867) | (11,294,433) |
Income Taxes - Discontinued Operations | 66,588 | |
Net Loss from Discontinued Operations | (278,867) | (11,227,845) |
Net Loss Applicable to Common Stock | $ (26,478,273) | $ (45,828,198) |
Basic & Diluted Loss Per Share: | ||
Continuing Operations, Basic (Loss) Per Share | $ (0.17) | $ (0.24) |
Continuing Operations, Diluted (Loss) Per Share | (0.17) | (0.24) |
Discontinued Operations, Basic (Loss) Per Share | 0 | (0.08) |
Discontinued Operations, Diluted (Loss) Per Share | 0 | (0.08) |
Basic Loss Per Share | (0.18) | (0.32) |
Diluted Loss Per Share | $ (0.18) | $ (0.32) |
Basic Weighted Average Shares Outstanding | 149,851,278 | 144,157,229 |
Diluted Weighted Average Shares Outstanding | 149,851,278 | 144,157,229 |
CONSOLIDATED STATEMENTS OF MEZZ
CONSOLIDATED STATEMENTS OF MEZZANINE EQUITY AND STOCKHOLDERS' (DEFICIT) EQUITY - 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 | ||||
Beginning balance, Convertible Preferred Stock at Dec. 31, 2020 | ||||||
Common Stock Issued, net of issuance cost of $3,330,752 | $ 4,661 | 48,414,585 | 48,419,246 | |||
Common Stock Issued, net of issuance costs (in shares) | 46,621,621 | |||||
Exercise of Warrants | $ 836 | 5,851,064 | 5,851,900 | |||
Exercise of Warrants (in shares) | 8,356,000 | |||||
Close-out of Warrant Liabilities Due to Warrant Exercise | 9,441,650 | 9,441,650 | ||||
Issuance of Common Stock upon Vesting of Restricted Stock Units (RSUs) | $ 78 | (78) | ||||
Issuance of Common Stock upon Vesting of Restricted Stock Units (RSU) (in shares) | 774,583 | |||||
Share Based Compensation | 2,016,640 | 2,016,640 | ||||
Net Loss | (45,828,198) | (45,828,198) | ||||
Ending balance, value at Dec. 31, 2021 | $ 15,012 | 303,958,829 | $ (5,250) | (278,085,813) | 25,882,778 | |
Ending balance (in shares) at Dec. 31, 2021 | 150,117,219 | 522,957 | ||||
Ending 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 (RSU) (in shares) | 389,003 | |||||
Share Based Compensation | (340,270) | (340,270) | ||||
Net Loss | (26,478,273) | (26,478,273) | ||||
Ending balance, value at Dec. 31, 2022 | $ 15,051 | $ 303,746,217 | $ (5,250) | $ (304,564,086) | (808,068) | |
Ending balance (in shares) at Dec. 31, 2022 | 150,506,222 | 522,957 | 3,000 | |||
Ending balance, Convertible Preferred Stock at Dec. 31, 2022 | $ 157,303 | $ 157,303 |
CONSOLIDATED STATEMENTS OF ME_2
CONSOLIDATED STATEMENTS OF MEZZANINE EQUITY AND STOCKHOLDERS' (DEFICIT) EQUITY (Parenthetical) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Statement of Stockholders' Equity [Abstract] | ||
Common Stock Issued, issuance costs | $ 3,330,752 | |
Issuance of Series C Preferred Stock, issuance costs | $ 8,300 | |
Issuance of Warrants, pursuant to the Series C Preferred Stock issuance | 750,000 | |
Issuance of Warrants, pursuant to the Series C Preferred Stock issuance, issuance costs | $ 6,700 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net Loss | $ (26,478,273) | $ (45,828,198) |
Less: Loss from Discontinued Operations | 278,867 | 11,227,845 |
Adjustments to Reconcile Net Loss to Net Cash Used in Operating Activities: | ||
Stock Based Compensation | (340,270) | 1,982,905 |
Gain on Forgiveness of PPP Loans | (5,009,590) | |
Provision for Excess and Obsolete Inventory | 1,044,607 | |
Loss on True-up of Fagron Variable Consideration | 993,571 | |
Change in Fair Value of Warrant Liability | (92,163) | 7,540,305 |
Cash Payments in Excess of Lease Expense | (17,033) | (6,227) |
Depreciation and Amortization Expense | 1,483,500 | 1,435,744 |
Change in Operating Assets and Liabilities: | ||
Accounts Receivable | (238,493) | (573,344) |
Receivable from Fagron | (30,951) | (6,492,321) |
Inventories | (820,171) | (236,153) |
Prepaid Expenses and Other Current & Non-current Assets | (513,506) | (80,842) |
Accounts Payable | 3,934,091 | 1,908,597 |
Contingent Loss Liability | (7,900,000) | |
Product Recall Liability | (1,694,194) | 2,000,000 |
Deferred Revenue | (643,974) | (100,000) |
Accrued Other Expenses and Bonuses | (1,333,629) | 675,329 |
Net Cash Used in Operating Activities of Continuing Operations | (25,512,628) | (38,411,343) |
Net Cash (Used in) Provided by Operating Activities in Discontinued Operations | (387,878) | 626,046 |
Net Cash Used in Operating Activities | (25,900,506) | (37,785,297) |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Purchase of Equipment | (680,417) | (1,223,449) |
Proceeds from Sale of Assets to Fagron | 4,090,881 | 1,407,869 |
Net Cash Provided by - Investing Activities of Continuing Operations | 3,410,464 | 184,420 |
Net Cash Provided by Investing Activities of Discontinued Operations | 73,445 | 98,317 |
Net Cash Provided by Investing Activities | 3,483,909 | 282,737 |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Proceeds from Issuance of Common Stock | 51,749,998 | |
Costs of Issuance of Common Stock | (3,330,752) | |
Proceeds from Issuance of Series C Preferred Stock warrants | 300,000 | |
Costs of Issuance of Series C Preferred Stock and warrants | (15,000) | |
Proceeds from Exercise of Warrants | 5,851,900 | |
Proceeds of PPP Loans | 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 | (2,100,796) | |
Net Cash Provided by Financing Activities | 285,000 | 53,935,845 |
(Decrease) Increase in Cash and Cash Equivalents and Restricted Cash | (22,131,597) | 16,433,285 |
Cash and Cash Equivalents and Restricted Cash: | ||
Beginning, December 31, 2021 | 23,250,793 | 6,748,945 |
Change in Cash and Cash Equivalents of Discontinued Operations | (7,764) | 68,563 |
Ending Balance | 1,111,432 | 23,250,793 |
RECONCILIATION OF CASH & CASH EQUIVALENTS AND RESTRICTED CASH | ||
Cash & Cash Equivalents | 1,081,364 | 23,220,770 |
Restricted Cash | 30,068 | 30,023 |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | ||
Cash Paid for Income Taxes | 3,651 | 4,125 |
Cash Paid for Interest | ||
SUPPLEMENTAL DISCLOSURE OF NON-CASH FINANCING AND INVESTING ACTIVITIES | ||
Fixed Asset Additions included in Accrued Expenses | 242,790 | 49,185 |
Forgiveness of PPP Loans | $ 5,009,590 |
NATURE OF BUSINESS
NATURE OF BUSINESS | 12 Months Ended |
Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
NATURE OF BUSINESS | NOTE 1: NATURE OF BUSINESS Adamis Pharmaceuticals Corporation (the “Company,” “Adamis Pharmaceuticals” or “Adamis”) has three wholly-owned subsidiaries: Adamis Corporation; U.S. Compounding, Inc. (“USC”); and Biosyn, Inc. Adamis is a specialty biopharmaceutical company primarily focused on developing and commercializing products in various therapeutic areas, including allergy, opioid overdose, respiratory and inflammatory disease. The Company’s SYMJEPI® (epinephrine) Injection is approved by the FDA for use in the emergency treatment of acute allergic reactions, including anaphylaxis. The Company’s ZIMHI® (naloxone) Injection is approved for the treatment of opioid overdose. Adamis operates under one operating segment. USC, which was registered as a drug compounding outsourcing facility under Section 503B of the U.S. Food, Drug & Cosmetic Act and the U.S. Drug Quality and Security Act, provided prescription compounded medications, including compounded sterile preparations and non-sterile compounds, to patients, physician clinics, hospitals, surgery centers and other clients in many states throughout the United States. USC also provided certain veterinary pharmaceutical products for animals. In July 2021, we 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. |
GOING CONCERN
GOING CONCERN | 12 Months Ended |
Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
GOING CONCERN | NOTE 2: GOING CONCERN The Company’s consolidated financial statements are prepared using the generally accepted accounting principles applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. However, the Company has incurred substantial recurring losses from continuing operations, negative cash flows from operations, and is dependent on additional financing to fund operations. We incurred a net loss of approximately $ 26.5 million 45.8 million 1.1 million 304.6 million 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. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 3: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Principles of Consolidation The accompanying consolidated financial statements include Adamis Pharmaceuticals and its wholly-owned operating subsidiaries. All significant intra-entity balances and transactions have been eliminated in consolidation. Accounting Estimates In preparing financial statements in conformity with U.S. GAAP, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of expenses during the reporting period. Due to inherent uncertainty involved in making estimates, actual results reported in future periods may be affected by changes in these estimates. On an ongoing basis, the Company evaluates its estimates and assumptions. These estimates and assumptions include warrant liabilities, valuing equity securities in share-based payments, estimating the useful lives of depreciable and amortizable assets, estimates related to the calculation of the variable consideration from the Company’s transaction with Fagron in the connection with the sale of certain assets of US Compounding and estimates associated with the assessment of impairment for long-lived assets. Cash and Cash Equivalents The Company considers all highly liquid investments with original maturities at the date of purchase of three months or less to be cash equivalents. There were no cash equivalents at December 31, 2022. At December 31, 2021, cash equivalents were comprised of money market funds . Restricted cash are certificates of deposit that are the underlying for the Company’s credit card. Accounts Receivable Accounts receivable are reported at the amount management expects to collect on outstanding balances. Management provides for probable uncollectible amounts through a charge to earnings and credit to allowance for doubtful accounts. Uncollectible amounts are based on the Company’s history of past write-offs and collections and current credit conditions. Allowance for doubtful accounts as of December 31, 2022 and 2021 was $ 0 Inventories Inventories are stated at the lower of standard cost, which approximates actual cost determined on the weighted average basis, or net realizable value. Inventories are recorded using the first-in, first-out method. The Company routinely evaluates quantities and values of inventories in light of current market conditions and market trends, and records a write-down for quantities in excess of demand and product obsolescence. The evaluation may take into consideration historic usage, expected demand, anticipated sales price, new product development schedules, the effect new products might have on the sale of existing products, product obsolescence, customer concentrations, product merchantability and other factors. Market conditions are subject to change and actual consumption of inventory could differ from forecasted demand. The Company also regularly reviews the cost of inventories against their estimated market value and records a lower of cost or market write-down for inventories that have a cost in excess of estimated market value, resulting in a new cost basis for the related inventories which is not reversed. Fixed Assets Property, plant and equipment are stated at cost, net of accumulated depreciation and amortization. Repairs and maintenance costs are expensed as incurred. Depreciation and amortization are computed using the straight-line method over the following estimated useful lives ranging from 3 5 Leases The Company determines if an arrangement is a lease at inception. Lease right-of-use assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. For operating leases with an initial term greater than 12 months, the Company recognizes operating lease right-of-use assets and operating lease liabilities based on the present value of lease payments over the lease term at the commencement date. Operating lease right-of-use assets are comprised of the lease liability plus any lease payments made and excludes lease incentives. Lease terms include options to renew or terminate the lease when we are reasonably certain that the renewal option will be exercised or when it is reasonably certain that the termination option will not be exercised. For our operating leases, if the interest rate used to determine the present value of future lease payments is not readily determinable, the Company estimates its incremental borrowing rate as the discount rate for the lease. Our incremental borrowing rate is estimated to approximate the interest rate on a collateralized basis with similar terms and payments, and in similar economic environments. Lease expense for lease payments is recognized on a straight-line basis over the lease term. The Company has elected the practical expedient to not separate lease and non-lease components. Other Long-Lived Assets The Company evaluates its long-lived assets with definite lives, such as fixed assets and right-of-use assets for impairment. The carrying value of fixed assets and right-of use assets is reviewed on a regular basis for the existence of facts or circumstances, both internally and externally, that may suggest impairment. Some factors which the Company considers to be triggering events for impairment review include a significant decrease in the market value of an asset, a significant change in the extent or manner in which an asset is used, a significant adverse change in the business climate that could affect the value of an asset, an accumulation of costs for an asset in excess of the amount originally expected, a current period operating loss or cash flow decline combined with a history of operating loss or cash flow uses or a projection that demonstrates continuing losses and a current expectation that, it is more likely than not, a long-lived asset will be disposed of at a loss before the end of its estimated useful life. The factors that drive the estimate of the life are often uncertain and are reviewed on a periodic basis or when events occur that warrant review. Recoverability is measured by comparison of the assets’ book value to future net undiscounted cash flows that the assets are expected to generate. If the assets are not recoverable, the impairment charge is measured as the amount by which the carrying value of the asset group exceeds the fair value. Warrant Liabilities Warrants are accounted for in accordance with the applicable authoritative accounting guidance as either liabilities or as equity instruments depending on the specific terms of the agreements. Liability-classified instruments are recorded at fair value at each reporting period with any change in fair value recognized as a component of change in fair value of warrant liabilities in the consolidated statements of operations and comprehensive loss. Revenue Recognition The Company recognizes revenues pursuant to ASC Topic 606, “ Revenue from Contracts with Customers Revenue is recognized at an amount that reflects the consideration to which the Company expects to be entitled in exchange for transferring goods or services to a customer. This principle is applied using the following 5-step process: 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. 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. Product Recall The Company establishes reserves for product recalls on a product-specific basis when circumstances giving rise to the recall become known. The Company, when establishing reserves for a product recall, considers cost estimates for any fees and incentives to customers for their effort to return the product, freight and destruction charges for returned products, warehouse and inspection fees, repackaging materials, point-of-sale materials and other costs including costs incurred by contract manufacturers. Additionally, the Company estimates product returns from consumers and customers across distribution channels, utilizing third- party data and other assumptions. These factors are updated and reevaluated each period and the related reserves are adjusted when these factors indicate that the recall reserves are either insufficient to cover or exceed the estimated product recall expenses. Significant changes in the assumptions used to develop estimates for product recall reserves could affect key financial information, including accounts receivable, inventory, accrued liabilities, net sales, gross profit, operating expenses and net income. In addition, estimating product recall reserves requires a high degree of judgment in areas such as estimating consumer returns, shelf and in-stock inventory at retailers across distribution channels, fees and incentives to be earned by customers for their effort to return the products, future freight rates and consumers’ claims. During the year ended December 31, 2021, the company recorded products recall reserves, specifically for the recall of certain lots of SYMJEPI from the marketplace that was initiated in March 2022. Aside from the approximately $ 0.3 Cost of Goods Sold The Company’s cost of goods sold includes direct and indirect costs to manufacture formulations and sell products, including active pharmaceutical ingredients, personnel costs, packaging, storage, shipping and handling costs, the write-off of obsolete inventory and other related expenses. Stock-Based Compensation The Company accounts for transactions in which the Company receives employee services in exchange for restricted stock units (“RSUs”) or options to purchase common stock as stock-based compensation cost based on estimated fair value. 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 Black-Scholes option-pricing model, however, relies on unobservable inputs, in which any significant change in the unobservable inputs reasonably could result in a significantly higher or lower fair value measurement at the reporting date, resulting in higher or lower stock-based compensation that could be material to the Company’s financial statements. Research and Development Research and development costs are expensed as incurred. Non-refundable advance payments for goods and services to be used in future research and development activities are recorded as an asset and are expensed when the research and development activities are performed. Legal Expense Legal fees are expensed as incurred and are included in selling, general and administrative expenses on the consolidated statements of operations. Income Taxes The Company accounts for income taxes under the deferred income tax method. Under this method, deferred income taxes are determined based on the estimated future tax effects of differences between the financial statement and tax basis of assets and liabilities given the provisions of enacted tax laws. Deferred income tax provisions and benefits are based on changes to the assets and liabilities from year to year. In providing for deferred taxes, the Company considers tax regulations of the jurisdictions in which they operate, estimates of future taxable income, and available tax planning strategies. If tax regulations, operating results or the ability to implement tax planning strategies vary, adjustments to the carrying value of deferred tax assets and liabilities may be required. Valuation allowances are recorded related to deferred tax assets based on the “more-likely-than-not” criteria. The Company accounts for uncertain tax positions in accordance with accounting guidance which requires the Company to recognize the financial statement benefit of a tax position only after determining that the relevant tax authority would, more likely than not, sustain the position following an audit. For tax positions meeting the more likely than not threshold, the amount recognized in the consolidated financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement with the relevant tax authority. The Company is subject to income taxes in the United States and various states. Tax years since the Company’s inception remain open to examination by the major taxing jurisdictions to which the Company is subject. The Company recognizes interest and penalties accrued related to unrecognized tax benefits in its income tax expense, if any. No interest or penalties have been accrued for any presented periods. The Company sold USC related customer relationship intangibles in the calendar year 2021 and the remaining USC assets and liabilities are classified as held for sale in discontinued operations, and the related tax benefit of approximately $ 67,000 Basic and Diluted Net 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 December 31, 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 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 years ended December 31, 2022 and December 31, 2021, consist of outstanding warrants covering 14,952,824 14,202,824 4,436,362 4,985,415 650,000 1,039,003 Segment Information Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic No. 280, Segment Reporting (“ASC 280”), establishes standards for the way that public business enterprises report information about operating segments in their annual consolidated financial statements and requires that those enterprises report selected information about operating segments in interim financial reports. ASC 280 also establishes standards for related disclosures about products and services, geographic areas and major customers. The Company’s business segments are based on the organization structure used by the chief operating decision maker for making operating and investment decisions and for assessing performance. Our chief executive officer, who is our chief operating decision maker (“CODM”), manages our operations as operating in two Discontinued Operations In accordance with ASC 205-20 Presentation of Financial Statements: Discontinued Operations Assets classified as held for sale that are not sold after the initial one-year period are assessed to determine if they meet the exception to the one-year requirement to continue being classified as held for sale. The primary asset that is held for sale is the USC property with a carrying value of $2.9 million. At December 31, 2022, the Company determined that the exception criteria to continue held for sale classification were met as the Company initiated actions to respond to changes in circumstances and the USC property is being actively marketed at a reasonable price based on its recent market valuation. The Company disposed of a component of its business in August 2021 and met the definition of a discontinued operation as of December 31, 2021. Accordingly, the major current assets, noncurrent assets, current liabilities, and noncurrent liabilities shall be reported as components of total assets and liabilities separate from those balances of the continuing operations as of December 31, 2022 and 2021, and the operating results of the business disposed are reported as loss from discontinued operations in the accompanying consolidated statement of operations for the years ended December 31, 2022 and 2021. For additional information, see Note 4 - Discontinued Operations. |
DISCONTINUED OPERATIONS AND ASS
DISCONTINUED OPERATIONS AND ASSETS HELD FOR SALE | 12 Months Ended |
Dec. 31, 2022 | |
DISCONTINUED OPERATIONS | |
DISCONTINUED OPERATIONS AND ASSETS HELD FOR SALE | NOTE 4: DISCONTINUED OPERATIONS AND ASSETS HELD FOR SALE In August 2021, we announced our agreement with Fagron Compounding Services, LLC (“Fagron”) to sell to Fagron certain assets of our subsidiary, US Compounding, Inc., related to its 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 4,637,000 1,856,000 700,000 As of December 31, 2022, the total amount received in connection with this purchase agreement was approximately $ 5,500,000 962,000 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. As of December 31, 2021, the Company had shut down the operations of USC, terminated all of USC’s employees and is engaged in the process of selling or attempting to sell or otherwise dispose of USC’s remaining assets. Fixed assets held for sale at December 31, 2022 and December 31, 2021 were approximately $ 6,700,000 6,800,000 2,800,000 2,600,000 3,900,000 4,200,000 On a quarterly basis, management reassesses the fair value less costs to sell of the land and buildings held for sale and recognizes a loss when the carrying value exceeds the fair value less cost to sell, or a gain when the fair value less costs to sell increases, limited to the cumulative loss previously recognized. In the absence of an executed sales agreement with a defined sales price, management’s estimate of the fair value is based on assumptions, including but not limited to management’s estimates of comparable properties’ price per square foot, market rents, and market capitalization rates. The primary fixed asset held for sale is USC’s land and building which, although there has not been a definitive offer on it, the land and building continues to be actively marketed. Absent a definitive offer, in the Company’s estimation, marketing the land and building at its recent appraised value of $ 3,200,000 2,900,000 3,008,000 3,200,000 6% The remaining fixed assets held for sale are primarily comprised of Construction In Progress - Equipment (“CIP”) assets that were primarily for the expansion of USC’s operations and were to be placed into service contingent upon the completion of equipment validation and when the economy had recovered from the COVID-19 pandemic. During the year ended December 31, 2021, with the decision to wind down and cease USC’s operations, we recorded approximately $ 2,200,000 972,000 208,000 832,000 200,000 In August 2021, the Company and its wholly-owned USC subsidiary entered into an Asset Purchase Agreement effective as of August 31, 2021 with a third party buyer, providing for the sale and transfer by USC of certain assets related to USC’s veterinary compounded pharmaceuticals business. The sale covers the transfer of all the veterinary business customers’ information belonging to USC or in USC’s control and possession and USC’s know how, information and expertise regarding the veterinary business. Pursuant to the agreement, the buyer agreed to pay the Company, for any sales of products in USC’s veterinary products list or equivalent products made to the customers included in the agreement during the five-year period after the date of the agreement, an amount equal to twenty percent ( 20 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. 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 other current assets 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: December 31, December 31 Carrying amounts of major classes of assets included as part of discontinued operations Cash and Cash Equivalents $ 30,085 $ 37,849 Accounts Receivable, net — 693 Inventories — 12,000 Fixed Assets, Held for Sale (i) 6,719,252 6,799,090 Other Assets 5,407 72,469 Less: Loss recognized on classification as held for sale (i) (2,801,828 ) (2,601,442 ) Total assets of the disposal group classified as discontinued operations in the statement of financial position $ 3,952,916 $ 4,320,659 Carrying amounts of major classes of liabilities included as part of discontinued operations Accounts Payable $ 649,633 $ 681,646 Accrued Other Expenses 75,602 133,313 Lease Liabilities 243,008 412,357 Contingent Loss Liability 50,000 410,000 Other Current Liabilities 208,000 — Deferred Tax Liability, net 45,930 45,930 Total liabilities of the disposal group classified as discontinued operations in the statement of financial position $ 1,272,173 $ 1,683,246 (i) In January 2023, the Company sold the pods with a carrying value of approximately $ 1 1 The revenues and expenses associated with discontinued operations included in our consolidated statements of operations were as follows: Year Ended December 31, 2022 2021 Major line items constituting pretax loss of discontinued operations REVENUE, net $ — $ 6,216,545 COST OF GOODS SOLD — (5,620,313 ) — 596,232 SELLING, GENERAL AND ADMINISTRATIVE EXPENSES (462,274 ) (7,802,066 ) RESEARCH AND DEVELOPMENT — (89,710 ) Impairment Expense – Intangible — (3,835,158 ) Impairment Expense – Goodwill — (868,412 ) Impairment Expense – Inventory — (871,180 ) Impairment Expense – Right of Use Asset — (448,141 ) Impairment Expense – Fixed Assets (200,386 ) (9,346 ) Loss from Held for Sale Classification — (2,601,442 ) Total (662,660 ) (15,929,223 ) OTHER INCOME (EXPENSE) Interest Expense — (70,903 ) Interest Income 45 45 Change in Estimate of Contingent Liability 360,000 — Gain on Sale of Assets to Fagron — 4,636,702 Gain on Sale of Fixed Assets 15,138 — Other Income 8,610 68,946 Net Loss from discontinued operations before income taxes (278,867 ) (11,294,433 ) Income Tax Benefit — 66,588 Net Loss from discontinued operations $ (278,867 ) $ (11,227,845 ) Discontinued Operations - Revenue Compounded Pharmaceuticals Facility Revenue Recognition. 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 $ 448,000 243,000 412,000 Discontinued Operations - Impairments Impairment of Intangibles— 1,856,000 3,835,000 0 Impairment of Goodwill 868,000 0 Loss from Held for Sale Classification 2,601,442 200,000 0 2,946,000 3,200,000 Impairment of Right of Use (ROU) Assets 0 448,000 0 Impairment of Inventory 871,000 598,000 273,000 0 12,000 USC inventories at December 31, 2022 and 2021 consisted of the following: December 31, December 31, Finished Goods $ — $ — Devices — 12,000 Inventories $ — $ 12,000 Reserve for obsolescence as of December 31, 2022 and 2021 was $ 0 Restructuring Costs Due to the facts and circumstances detailed above, the Company has identified three major types of restructuring activities related to the disposal of USC in addition to the approximately $ 8.6 920,000 410,000 422,000 410,000 Schedule of restructuring costs Contract Chemical Termination Cost Destruction Costs Total Balance at December 31, 2021 $ 410,000 $ 3,023 $ 413,023 Decrease from change in estimate (360,000 ) — (360,000 ) Payments — (3,023 ) (3,023 ) Balance at December 31, 2022 $ 50,000 $ — $ 50,000 At December 31, 2021, the liabilities of approximately $ 410,000 50,000 360,000 50,000 3,000 Discontinued Operations - Debt 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. As of December 31, 2022 and December 31, 2021, there was no outstanding principal balance owed on the applicable. The loan bore an interest of 6.00% 0 49,000 |
REVENUES
REVENUES | 12 Months Ended |
Dec. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | |
REVENUES | NOTE 5: REVENUES Revenue from Contracts with Customers Revenue is recognized pursuant to ASC Topic 606, “ Revenue from Contracts with Customers 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 4) 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 include, among others, corticosteroids, hormone replacement therapies, hospital outsourcing products, and injectables. In July 2021, we 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 and ZIMHI with US WorldMeds 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 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 years from the launch by USWM of the first product in the United States pursuant to the agreement, unless terminated earlier in accordance with its terms. 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-year terms after the initial 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 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 December 31, 2022 and December 31, 2021, a liability of approximately $ 0.3 2 0.3 0.2 2.5 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. The following is a rollforward of deferred revenue at December 31, 2022 and 2021: December 31, 2022 December 31, 2021 Opening Balance $ 850,000 $ 950,000 Revenue Recognized (644,000 ) (100,000 ) Ending Balance $ 206,000 $ 850,000 The increase of approximately $ 544,000 100,000 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. |
CONCENTRATIONS
CONCENTRATIONS | 12 Months Ended |
Dec. 31, 2022 | |
Risks and Uncertainties [Abstract] | |
CONCENTRATIONS | NOTE 6: CONCENTRATIONS Financial instruments that potentially subject the Company to credit risk consist principally of cash, trade receivables, and accounts payable. Cash and Cash Equivalents The Company at times may have cash in excess of the Federal Deposit Insurance Corporation (“FDIC”) limit. The Company maintains its cash with larger financial institutions. The Company has not experienced losses on these accounts and management believes that the Company is not exposed to significant risks on such accounts. Sales and Trade Receivables Trade receivables are short-term receivables from sales of the Company’s FDA-approved SYMJEPI and ZIMHI products to its exclusive distributor, USWM. All revenues are US-based. |
INVENTORIES
INVENTORIES | 12 Months Ended |
Dec. 31, 2022 | |
Inventory Disclosure [Abstract] | |
INVENTORIES | NOTE 7: INVENTORIES Inventories at December 31, 2022 and December 31, 2021 consisted of the following: December 31, December 31, Finished Goods $ 267,554 $ — Work-in-Process 261,720 386,610 Raw Materials 709,504 31,997 Total Inventories $ 1,238,778 $ 418,607 Reserve for obsolescence as of December 31, 2022 and December 31, 2021 was $ 0 |
PREPAID EXPENSES AND OTHER CURR
PREPAID EXPENSES AND OTHER CURRENT ASSETS | 12 Months Ended |
Dec. 31, 2022 | |
Prepaid Expenses And Other Current Assets | |
PREPAID EXPENSES AND OTHER CURRENT ASSETS | NOTE 8: PREPAID EXPENSES AND OTHER CURRENT ASSETS Prepaid expenses and other current assets at December 31, 2022 and December 31, 2021: December 31, December 31, Employee Retention Credit $ 875,307 $ — Prepaid Insurance 323,143 347,511 Prepaid - Research and Development 588,354 115,119 Other Prepaid 78,590 635,620 Other Current Assets 18,621 215,296 $ 1,884,015 $ 1,313,546 Employee Retention Credit: The Company applied for the Employee Retention Credit (ERC) which was available under the CARES Act. The ERC is a fully refundable tax credit for employers equal to 50 percent of qualified wages (including allocable qualified health plan expenses) that eligible employers paid their employees. The ERC applied to wages paid after March 12, 2020 and before January 1, 2021. The Company hired a third-party to assess if the Company qualified as an eligible employer and to prepare the application for the ERC credit if the Company was determined to be an eligible employer. Prior to December 31, 2022, the Company was informed by the Internal Revenue Service that it would receive approximately $ 875,000 |
FIXED ASSETS
FIXED ASSETS | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
FIXED ASSETS | NOTE 9: FIXED ASSETS Fixed assets at December 31, 2022 and December 31, 2021 are summarized in the table below: Description Useful Life December 31, December 31, Machinery and Equipment 3 7 $ 5,209,575 $ 4,522,583 Less: Accumulated Depreciation (4,665,067 ) (3,181,567 ) Construction In Progress – Equipment (CIP) 744,386 993,752 Fixed Assets, net $ 1,288,894 $ 2,334,768 For the years ended December 31, 2022 and 2021, depreciation expense was approximately $ 1,484,000 1,436,000 |
LEASES
LEASES | 12 Months Ended |
Dec. 31, 2022 | |
Leases | |
LEASES | NOTE 10: LEASES The Company has one 11 The Company previously entered into a lease agreement to occupy leased premises with a term commencing December 1, 2014 (as amended, the “Lease”) and expiring on November 30, 2018 November 30, 2023 28,000 32,000 354,000 The amortizable lives of operating leased asset is limited by the expected lease term. The Company’s lease generally does not provide an implicit rate, and therefore the Company uses its incremental borrowing rate as the discount rate when measuring operating 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 and the prevailing incremental borrowing rate thereafter. The Company’s weighted average remaining lease term and weighted average discount rate for operating and financing leases as of December 31, 2022 and 2021 are: December 31, 2022 Operating Weighted Average Remaining Lease Term 0.92 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 audited consolidated balance sheets as of December 31, 2022: Operating 2023 $ 349,365 Undiscounted Future Minimum Lease Payments 349,365 Less: Difference between undiscounted lease payments and discounted lease liabilities 6,803 Total Lease Liabilities $ 342,562 Short-Term Lease Liabilities $ 342,562 Long-Term Lease Liabilities $ — Operating lease expense was approximately $ 354,000 Cash paid for amounts included in the measurement of operating lease liabilities were approximately $ 371,000 360,000 |
ACCRUED OTHER EXPENSES
ACCRUED OTHER EXPENSES | 12 Months Ended |
Dec. 31, 2022 | |
Payables and Accruals [Abstract] | |
ACCRUED OTHER EXPENSES | NOTE 11: ACCRUED OTHER EXPENSES Accrued other expenses at December 31, 2022 and December 31, 2021: December 31, December 31, Accrued Expenses - R&D $ 42,400 $ 741,521 Accrued Expenses - COGS 1,099,571 658,282 Accrued Expenses - Inventory — 584,731 Accrued Expenses - Other 200,363 500,309 Accrued PTO 167,719 315,398 $ 1,510,053 $ 2,800,241 Accrued other expenses includes firm purchase commitment losses related to batches produced that were determined to be commercially unviable and, therefore, not inventoriable. Accrued Expenses- COGS of approximately $ 348,000 Additionally, firm purchase commitment losses of approximately $ 250,000 |
DEBT
DEBT | 12 Months Ended |
Dec. 31, 2022 | |
Debt Disclosure [Abstract] | |
DEBT | NOTE 12: 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 3,244,095 Second Draw Loan (or, “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 1,765,495 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 MEASUREMENTS
FAIR VALUE MEASUREMENTS | 12 Months Ended |
Dec. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | NOTE 13: FAIR VALUE MEASUREMENTS 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 1 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. 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 based on Level 1 of the fair value hierarchy. Based on the borrowing rates currently available to the Company for debt with similar terms and consideration of default and credit risk, the carrying value of the Ben Franklin Note discussed in Note 16 approximates fair value based on Level 2 of the fair value hierarchy. The categorization of a financial instrument within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. 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 December 31, 2022 Total Level 1 Level 2 Level 3 Liabilities 2020 Warrant liability $ 7,492 $ — $ — $ 7,492 Total common stock warrant liabilities $ 7,492 $ — $ — $ 7,492 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, 2022 include the expected volatility of the Company’s stock of approximately 70 0.17 0.0 2.68 4.362 Fair Value Measurements at December 31, 2021 Total Level 1 Level 2 Level 3 Liabilities 2020 Warrant liability $ 99,655 $ — $ — $ 99,655 Total common stock warrant liabilities $ 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 During the periods presented, the Company has not changed the manner in which it values liabilities that are measured at fair value using Level 3 inputs. The following table sets forth a summary of the changes in the fair value of the Company’s Level 3 financial instruments, which are treated as liabilities, as follows: 2019 Warrant 2020 Warrant Number of Liability Number of Liability (in thousands) (in thousands) Balance at December 31, 2020 13,800,000 $ 2,484,000 8,700,000 $ 2,001,000 Adoption of ASC 2020-06 (13,800,000 ) (2,484,000 ) — — Change in Fair Value of Warrants at Date of Exercise — — — 7,521,150 Exercise of Warrants — — (8,350,000 ) (9,441,650 ) Change in Fair Value, Year ended December 31, 2021 — — — 19,155 Balance at December 31, 2021 — $ — 350,000 $ 99,655 Change in Fair Value, Year ended December, 31, 2022 — — — (92,163 ) Balance at December 31, 2022 — $ — 350,000 $ 7,492 |
LEGAL MATTERS
LEGAL MATTERS | 12 Months Ended |
Dec. 31, 2022 | |
COMMITMENTS AND CONTINGENCIES, see Note 16 | |
LEGAL MATTERS | NOTE 14: 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. Investigation On May 11, 2021, each of the company and its USC subsidiary received a grand jury subpoena from the U.S. Attorney’s Office for the Southern District of New York (the “USAO”) issued in connection with a criminal investigation, requesting a broad range of documents and materials relating to, among other matters, certain veterinary products sold by the company’s USC subsidiary, 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 these and other matters. The company has also received requests from the Securities and Exchange Commission (“SEC”) for the voluntary production of documents and information relating to the subject matter of the USAO’s subpoenas and certain other matters arising therefrom in connection with the SEC’s investigation. The company has produced documents and will continue to produce and provide documents in response to the subpoenas and requests as needed. Additionally, on March 16, 2022, we were informed that the Civil Division of the USAO (“Civil Division”) is investigating the company’s Second Draw PPP Loan application disclosed in previous reports. The Audit Committee of the Board engaged outside counsel to conduct an internal inquiry into the matter. In June 2022, following the inquiry the company paid a total of $ 1,787,417 Regulatory In October 2021, following the sale in July 2021 of certain assets of the Company’s USC subsidiary relating to USC’s human compounding pharmaceutical business and the Company’s approval of a restructuring process of winding down the remaining operations and business of USC and selling or disposing of the remaining assets of USC, the Company entered into a Consent Order with the Arkansas State Board of Pharmacy to resolve an ongoing administrative proceeding before the pharmacy board, pursuant to which USC agreed to surrender its Arkansas retail pharmacy permit and wholesaler/outsourcer permit effective October 31, 2021, to pay a civil penalty of $ 75,000 75,000 150,000 Nasdaq Compliance December 28, 2022, the Company was notified by the Listing Qualifications Department (the “Staff”) of The Nasdaq Stock Market LLC (“Nasdaq”) that, based upon the Company’s non-compliance with the minimum bid price requirement set forth in Nasdaq Listing Rule 5550(a)(2) (the “Rule”) as of December 27, 2022, the Company’s common stock was subject to delisting unless the Company timely requested a hearing before the Nasdaq Hearings Panel (the “Panel”). The Company timely requested a hearing before the Panel, and a hearing was held on February 16, 2023. On February 21, 2023, the Staff notified the Company that the Panel has granted the Company’s request for continued listing of the Company’s common stock on the Nasdaq Stock Market and an extension until June 26, 2023 (the “Compliance Period”) to regain compliance with the continued listing requirements for The Nasdaq Capital Market, including the minimum $ 1.00 1.00 Jerald Hammann 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. scheduled 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. The company has not accrued any amount in respect of the matters described under the headings “Investigation” or “Jerald Hammann,” as we cannot estimate the probable loss or the range of probable losses that we may incur. We are unable to make such an estimate because (i) with respect to the matters described under the heading “Investigation,” we are unable to predict whether any proceedings will be initiated by the USAO, SEC or other authorities arising from such matters, what, if any, relief, remedies or remedial measures the USAO, SEC, or other authorities may seek if proceedings are commenced, and the duration, scope, or outcome of any such proceedings, if they are commenced, (ii) litigation and other proceedings are inherently uncertain and unpredictable, and (iii) with respect to the matters described under the heading “Jerald Hammann,” the complaint seeks declaratory and injunctive relief. Because legal proceedings and investigations are uncertain and unpredictable and unfavorable results could occur, assessing contingencies is highly subjective and requires significant judgments about future events, including determining both the probability and reasonably estimated amount of a possible loss or range of loss. The amount of any ultimate loss may differ from any accruals or estimates that the Company may make. |
LICENSING AGREEMENTS
LICENSING AGREEMENTS | 12 Months Ended |
Dec. 31, 2022 | |
Licensing Agreements | |
LICENSING AGREEMENTS | NOTE 15: LICENSING AGREEMENTS Tempol On June 12, 2020, we entered into a license agreement with a third party, or the Licensor, to license rights under patents, patent applications and related know-how of Licensor relating to Tempol, an investigational drug. The exclusive license included the worldwide use under the licensed patent rights and related rights of Tempol for the fields of COVID-19 infection, asthma, respiratory syncytial virus infection, and influenza infection. In addition, the exclusive license includes the use of Tempol as a therapeutic for reducing radiation-induced dermatitis in patients undergoing treatment for cancer. In consideration for the Licensor providing the rights under its patent rights and related know-how relating to Tempol within the licensed fields, we paid Licensor $ 250,000 1,000,000 On October 27, 2022, we received a communication from the Licensor asserting that the license agreement between the Licensor and us relating to Tempol has terminated by virtue of alleged noncompliance by us with certain financial covenants contained in the agreement. We dispute, and do not agree, that the agreement has terminated. We are also evaluating potential claims against the Licensor including possible breach of its obligations under the agreement, and we intend to vigorously defend our rights relating to the agreement. We do not believe that the agreement or any termination of the agreement is material to the Company’s current or presently anticipated future business, financial conditions or results of operations. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2022 | |
COMMITMENTS AND CONTINGENCIES, see Note 16 | |
COMMITMENTS AND CONTINGENCIES | NOTE 16: COMMITMENTS AND CONTINGENCIES Maintenance Fees and Firm Purchase Commitments: The Company has a production threshold commitment to a manufacturer of our SYMJEPI products where 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. Maintenance fees for the years ended December 31, 2022 and 2021 were approximately $ 0 0 The Company also has firm purchase commitments to a manufacturer of our SYMJEPI products based on rolling forecasts where a portion of the forecast represents binding orders and the remaining portion non-binding. For the years ended December 31, 2022 and 2021, purchases under firm purchase commitments were approximately $ 0.6 1.1 Legal Matters: For information concerning contingencies relating to legal proceedings, see Note 14 of the notes to the consolidated financial statements. Ben Franklin Note: Biosyn issued a note payable to Ben Franklin Technology Center of Southeastern Pennsylvania (“Ben Franklin Note”) in October 1992, in connection with funding the development of Savvy (C31G), a compound then under development to prevent the transmission of HIV/AIDS. The repayment terms of the non-interest bearing obligation include the remittance of an annual fixed percentage of 3.0 777,902 Upon the Company’s acquisition of Biosyn in 2004, the value of the Ben Franklin Note would be impacted by the ability to estimate Biosyn’s expected future revenues, which in turn hinge largely upon future efforts to commercialize the product candidate, C31G, the realization of which was not likely given that the two Savvy clinical trials were halted in 2005 and 2006. Additionally, final results released in 2008 noted that for statistical reasons, a continuation of either study could not have established Savvy’s ability to prevent HIV infections. The Company determined that the Ben Franklin Note will have no future cash flows, as the Company does not believe the product will create a revenue stream in the future due to the futility of the two clinical trials, and as a result, had no fair value at the time of acquisition. |
COMMON STOCK
COMMON STOCK | 12 Months Ended |
Dec. 31, 2022 | |
Equity [Abstract] | |
COMMON STOCK | NOTE 17: COMMON STOCK 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 |
CONVERTIBLE PREFERRED STOCK
CONVERTIBLE PREFERRED STOCK | 12 Months Ended |
Dec. 31, 2022 | |
Equity [Abstract] | |
CONVERTIBLE PREFERRED STOCK | NOTE 18: CONVERTIBLE PREFERRED STOCK July 2022 Series C Preferred Stock 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 shares of Series C Convertible Preferred Stock, par value $ 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 a proposal to effect a reverse stock split of the common stock (the “Proposal”) 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, the Company paid $ 15,000 750,000 |
STOCK-BASED COMPENSATION, WARRA
STOCK-BASED COMPENSATION, WARRANTS AND SHARES RESERVED | 12 Months Ended |
Dec. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
STOCK-BASED COMPENSATION, WARRANTS AND SHARES RESERVED | NOTE 19: STOCK-BASED COMPENSATION, WARRANTS AND SHARES RESERVED The Company accounts for transactions in which the Company receives services in exchange for restricted stock units (“RSUs”) or options to purchase common stock as stock-based compensation cost based on estimated fair value. 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. 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 initially pursuant to stock awards under the 2020 Plan is 2,000,000 5.0 3.00 ten 14,171,816 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 The Company had a 2009 Equity Incentive Plan (the “2009 Plan”). The 2009 Plan terminated effective February 2019 and no new awards may be made under the 2009 Plan. In June 2022, the Company issued 250,000 540,000 Stock Options The following summarizes the stock option activity for the year ended December 31, 2022 below: 2009 Equity Incentive Plan (or, 2009 Plan): 2009 Weighted Weighted * Total Outstanding and Vested and Expected to Vest as of December 31, 2021 4,985,415 $ 4.21 4.05 Options Canceled/Expired (679,053 ) 4.20 — Total Outstanding and Vested as of December 31, 2022 4,306,362 $ 4.21 2.09 * Maximum contractual term for options is 10 years As of December 31, 2022, the unamortized compensation expense related to 2009 Plan awards was approximately $ 0 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 December 31, 2022 and 2021 was $ 0 Non-Plan Awards: Non-Plan Weighted-Average Weighted-Average Total Outstanding, as of December 31, 2021 — $ — — Granted 130,000 0.62 9.13 Total Outstanding as of December 31, 2022 130,000 $ 0.62 9.13 Vested and Expected to Vest at December 31, 2022 57,499 $ 0.62 9.13 Non-plan awards are granted pursuant to Rule 5635(c)(4) of the Nasdaq Listing Rules, as a material inducement to the willingness of such person to join the Company as a non-officer employee, effective upon the effective date of Board of Director-approved resolutions to grant nonqualified stock options to such person, (or, inducement grant.) Inducement grants, although granted outside of the Company’s 2020 Equity Incentive Plan, are subject to the terms and conditions set forth in that plan. The terms of inducement grants are generally the same as terms would be under the 2020 Equity Incentive Plan, wherein the exercise price of the options is equal to the fair value of the Company’s common stock at date of grant, with vesting commencing on date of grant. And, vesting schedule consisting of one-sixth ( 1/6 6 1/36 three years As of December 31, 2022, the unamortized compensation expense related to non-plan awards was approximately $ 0 Restricted Stock Units The following summarizes the RSU activity for the year ended December 31, 2022 below: Number of Shares/Unit Weighted 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 December 31, 2022 650,000 $ 4.64 The following summarizes the non-vested RSU’s as of December 31, 2022: RSUs Price Non-Employee Board of Directors 150,000 (1) $ 8.46 Company Executive and employees 500,000 (1) $ 3.50 Total RSUs 650,000 (1) The RSUs will have cliff vesting after seven years As of December 31, 2022, the unamortized compensation expense related to RSUs was approximately $ 189,000 0.87 Total Stock-Based Compensation: The following summaries stock-based compensation recognized as research and development costs (or, R&D) and selling, general and administrative costs (or, SG&A) for the year-ended December 31, 2022 and 2021: December 31, 2022 December 31, 2021 R&D $ (66,222 ) $ 688,611 SG&A (274,048 ) 1,328,029 Total Stock-based Compensation $ (340,270 ) $ 2,016,640 As discussed earlier in this Report, the negative stock-based compensation for the year-ended December 31, 2022, is primarily due to RSU award modifications resulting from accelerated vesting due to a separation agreement and the decline in the Company’s stock price which decreased the fair value of the accelerated awards Warrants The following table summarizes warrants outstanding at: December 31, 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, 2023 January 5, 2028 Total Warrants 14,952,824 * See Note 13 for the fair value of the warrant liability related to the 2020 Warrants which are liability classified. Shares Reserved At December 31, 2022, the Company has reserved shares of common stock for issuance upon exercise of outstanding options and warrants, and vesting of RSUs, 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 |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | NOTE 20: INCOME TAXES Net operating losses and tax credit carryforwards as of December 31, 2022 are as follows: Amount Expiration Net operating losses, federal (Post December 31, 2017) $ 135,375,006 N/A Net operating losses, federal (Pre January 1, 2018) 86,660,717 2027 2038 Net operating losses, state 91,134,554 2030 2043 Tax credits, federal 3,541,039 2037 2043 Tax credits, state 2,145,442 N/A Under the new tax law, the federal net operating loss arising in tax years ending after December 31, 2017 will be carried forward indefinitely with an 80% taxable income limitation Pursuant to Internal Revenue Code Section 382, the annual use of the net operating loss carry forwards and research and development tax credits could be limited by any greater than 50% ownership change during any three year testing period. As a result of any such ownership change, portions of the Company’s net operating loss carry forwards and research and development tax credits are subject to annual limitations. The Company completed a Section 382 analysis in 2017, and the net operating loss deferred tax assets reflect the results of the analysis. The recoverability of these carry forwards could be subject to limitations upon future changes in ownership as defined by Section 382 of the Internal Revenue Code. The Company has not completed an ownership change analysis pursuant to IRC Section 382 since 2017. However, the Company has established a valuation allowance as the realization of such deferred tax assets has not met the more likely than not threshold requirement. If ownership changes within the meaning of IRC Section 382 have occurred, the amount of remaining tax attribute carryforwards available to offset future taxable income and income taxes in future years may be significantly restricted or eliminated. Further, the Company’s deferred tax assets, along with the corresponding valuation allowance, associated with such tax attributes could be significantly reduced upon an ownership change within the meaning of IRC Section 382 and such changes could be material. Due to the existence of the valuation allowance, changes in the Company’s deferred tax assets from any such limitation will not impact the Company’s effective tax rate. ASC 740 requires that the tax benefit of net operating losses, temporary differences and credit carry forwards be recorded as an asset to the extent that management assesses that realization is “more likely than not.” Realization of the future tax benefits is dependent on the Company’s ability to generate sufficient taxable income within the carry forward period. Because of the Company’s recent history of operating losses, management believes that recognition of the deferred tax assets arising from the above-mentioned future tax benefits is currently not likely to be realized and, accordingly, has provided a valuation allowance. At December 31, 2022 and 2021, the Company reassessed its need for valuation allowance and decreased the valuation allowance because it impaired an indefinite lived trademark during the year which previously represented a taxable temporary difference for which no deferred tax asset could be realized. This was determined to be a future source of taxable income. This reassessment resulted in a tax benefit of $ 44,000 65,000 46,000 67,000 The expense for income taxes from operations consists of the following for the years ended December 31, 2022 and 2021: December 31, December 31, Current $ 2,000 $ 2,000 Deferred (46,000 ) (67,000 ) Tax Expense (Benefit) (44,000 ) (65,000 ) Tax Benefit Allocated to Discontinued Operations 46,000 67,000 Tax Expense Allocated to Continuing Operations $ 2,000 $ 2,000 At December 31, 2022 and December 31, 2021 the significant components of the deferred tax assets from operations are summarized below (all of which are domestic): December 31, December 31, Deferred Tax Assets Net Operating Losses Carryforwards $ 51,482,000 $ 47,419,000 Tax Credits 5,686,000 4,982,000 Stock Compensation 746,000 1,008,000 Accrued Expenses 47,000 189,000 Warranty Expenses 75,000 449,000 Intangibles 948,000 1,017,000 Fixed Assets 253,000 127,000 Lease Liabilities 143,000 248,000 R&D Capitalization 1,963,000 — Other 833,000 838,000 Total Deferred Tax Assets 62,176,000 56,277,000 Valuation Allowance (60,227,000 ) (54,261,000 ) Deferred Tax Assets, Net of Valuation Allowance, Total $ 1,949,000 $ 2,016,000 Deferred Tax Liabilities Intangibles - Indefinite Lived $ — $ (187,000 ) Right-of-use Assets (78,000 ) (146,000 ) State Taxes (1,871,000 ) (1,729,000 ) Fixed Assets — — Total Deferred Tax Liabilities (1,949,000 ) (2,062,000 ) Net Deferred Tax Liability $ — $ (46,000 ) Deferred income taxes are provided for the temporary differences between the financial reporting basis and the tax basis of the Company’s assets and liabilities. The Company has determined at December 31, 2022 and December 31, 2021 that a full valuation allowance would be required against of all the Company’s operating loss carry forwards and deferred tax assets that the Company does not expect to be utilized from the reversal of its deferred tax liabilities. The following table reconciles the Company’s losses from operations before income taxes for the year ended December 31, 2022 and December 31, 2021: December 31, 2022 December 31, 2021 Federal Statutory Rate $ (5,555,000 ) 21.00 % $ (9,637,000 ) 21.00 % State Income Tax, net of Federal Tax (7,000 ) 0.03 % (9,000 ) 0.02 % Indefinite Lived - DTL (35,000 ) 0.13 % (52,000 ) 0.11 % Other Permanent Differences 682,000 (2.58 %) 1,032,000 (2.25 %) Research and Development Credits (506,000 ) 1.91 % (377,000 ) 0.82 % Other 80,000 (0.30 %) (539,000 ) 1 .17 % Change in Valuation Allowance 5,297,000 (20.02 %) 9,517,000 (20.74 %) Expected Tax Expense $ (44,000 ) 0.17 % $ (65,000 ) 0.13 % The Company files income tax returns in the United States, California and other state jurisdictions. Due to the Company’s losses incurred, the Company is essentially subject to income tax examination by tax authorities from inception to date. Interest and penalties related to uncertain tax positions are recognized as a component of income tax expense. For the tax year ended December 31, 2022 and 2021, the Company recognized no interest or penalties, and identified no material amount of unrecognized tax benefits. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2022 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 21: SUBSEQUENT EVENTS On February 27, 2023, the Company announced that it had entered into an Agreement and Plan of Merger and Reorganization with DMK Pharmaceuticals Corporation. DMK Pharmaceuticals is a privately-held, clinical stage neuro-biotechnology company focused on the development and commercialization of potential products for the treatment of a variety of neuro-based disorders, including without limitation opioid use disorder, acute and chronic pain, bladder problems, and Parkinson’s disease. Completion of the transaction is subject to a number of conditions, including without limitation approval by the Adamis stockholders of certain matters relating to the transaction. There can be no assurances that the proposed merger transaction with DMK will be completed. On February 8, 2023, the Company received notice from the Food and Drug Administration (“FDA”) that the FDA considers the voluntary recall of the Company’s SYMJEPI products to be terminated. With the termination of the voluntary recall, the Company anticipates having SYMJEPI relaunched and commercially available in the first half of 2023. On March 14, 2023, the Company entered into a securities purchase agreement with an investor for the purchase and sale of 16,500,000 7,500,000 48,000,000 0.125 0.1249 0.138 six months five years and six months 3 2.7 |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation The accompanying consolidated financial statements include Adamis Pharmaceuticals and its wholly-owned operating subsidiaries. All significant intra-entity balances and transactions have been eliminated in consolidation. |
Accounting Estimates | Accounting Estimates In preparing financial statements in conformity with U.S. GAAP, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of expenses during the reporting period. Due to inherent uncertainty involved in making estimates, actual results reported in future periods may be affected by changes in these estimates. On an ongoing basis, the Company evaluates its estimates and assumptions. These estimates and assumptions include warrant liabilities, valuing equity securities in share-based payments, estimating the useful lives of depreciable and amortizable assets, estimates related to the calculation of the variable consideration from the Company’s transaction with Fagron in the connection with the sale of certain assets of US Compounding and estimates associated with the assessment of impairment for long-lived assets. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid investments with original maturities at the date of purchase of three months or less to be cash equivalents. There were no cash equivalents at December 31, 2022. At December 31, 2021, cash equivalents were comprised of money market funds . Restricted cash are certificates of deposit that are the underlying for the Company’s credit card. |
Accounts Receivable | Accounts Receivable Accounts receivable are reported at the amount management expects to collect on outstanding balances. Management provides for probable uncollectible amounts through a charge to earnings and credit to allowance for doubtful accounts. Uncollectible amounts are based on the Company’s history of past write-offs and collections and current credit conditions. Allowance for doubtful accounts as of December 31, 2022 and 2021 was $ 0 |
Inventories | Inventories Inventories are stated at the lower of standard cost, which approximates actual cost determined on the weighted average basis, or net realizable value. Inventories are recorded using the first-in, first-out method. The Company routinely evaluates quantities and values of inventories in light of current market conditions and market trends, and records a write-down for quantities in excess of demand and product obsolescence. The evaluation may take into consideration historic usage, expected demand, anticipated sales price, new product development schedules, the effect new products might have on the sale of existing products, product obsolescence, customer concentrations, product merchantability and other factors. Market conditions are subject to change and actual consumption of inventory could differ from forecasted demand. The Company also regularly reviews the cost of inventories against their estimated market value and records a lower of cost or market write-down for inventories that have a cost in excess of estimated market value, resulting in a new cost basis for the related inventories which is not reversed. |
Fixed Assets | Fixed Assets Property, plant and equipment are stated at cost, net of accumulated depreciation and amortization. Repairs and maintenance costs are expensed as incurred. Depreciation and amortization are computed using the straight-line method over the following estimated useful lives ranging from 3 5 |
Leases | Leases The Company determines if an arrangement is a lease at inception. Lease right-of-use assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. For operating leases with an initial term greater than 12 months, the Company recognizes operating lease right-of-use assets and operating lease liabilities based on the present value of lease payments over the lease term at the commencement date. Operating lease right-of-use assets are comprised of the lease liability plus any lease payments made and excludes lease incentives. Lease terms include options to renew or terminate the lease when we are reasonably certain that the renewal option will be exercised or when it is reasonably certain that the termination option will not be exercised. For our operating leases, if the interest rate used to determine the present value of future lease payments is not readily determinable, the Company estimates its incremental borrowing rate as the discount rate for the lease. Our incremental borrowing rate is estimated to approximate the interest rate on a collateralized basis with similar terms and payments, and in similar economic environments. Lease expense for lease payments is recognized on a straight-line basis over the lease term. The Company has elected the practical expedient to not separate lease and non-lease components. |
Other Long-Lived Assets | Other Long-Lived Assets The Company evaluates its long-lived assets with definite lives, such as fixed assets and right-of-use assets for impairment. The carrying value of fixed assets and right-of use assets is reviewed on a regular basis for the existence of facts or circumstances, both internally and externally, that may suggest impairment. Some factors which the Company considers to be triggering events for impairment review include a significant decrease in the market value of an asset, a significant change in the extent or manner in which an asset is used, a significant adverse change in the business climate that could affect the value of an asset, an accumulation of costs for an asset in excess of the amount originally expected, a current period operating loss or cash flow decline combined with a history of operating loss or cash flow uses or a projection that demonstrates continuing losses and a current expectation that, it is more likely than not, a long-lived asset will be disposed of at a loss before the end of its estimated useful life. The factors that drive the estimate of the life are often uncertain and are reviewed on a periodic basis or when events occur that warrant review. Recoverability is measured by comparison of the assets’ book value to future net undiscounted cash flows that the assets are expected to generate. If the assets are not recoverable, the impairment charge is measured as the amount by which the carrying value of the asset group exceeds the fair value. |
Warrant Liabilities | Warrant Liabilities Warrants are accounted for in accordance with the applicable authoritative accounting guidance as either liabilities or as equity instruments depending on the specific terms of the agreements. Liability-classified instruments are recorded at fair value at each reporting period with any change in fair value recognized as a component of change in fair value of warrant liabilities in the consolidated statements of operations and comprehensive loss. |
Revenue Recognition | Revenue Recognition The Company recognizes revenues pursuant to ASC Topic 606, “ Revenue from Contracts with Customers Revenue is recognized at an amount that reflects the consideration to which the Company expects to be entitled in exchange for transferring goods or services to a customer. This principle is applied using the following 5-step process: 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. 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. |
Product Recall | Product Recall The Company establishes reserves for product recalls on a product-specific basis when circumstances giving rise to the recall become known. The Company, when establishing reserves for a product recall, considers cost estimates for any fees and incentives to customers for their effort to return the product, freight and destruction charges for returned products, warehouse and inspection fees, repackaging materials, point-of-sale materials and other costs including costs incurred by contract manufacturers. Additionally, the Company estimates product returns from consumers and customers across distribution channels, utilizing third- party data and other assumptions. These factors are updated and reevaluated each period and the related reserves are adjusted when these factors indicate that the recall reserves are either insufficient to cover or exceed the estimated product recall expenses. Significant changes in the assumptions used to develop estimates for product recall reserves could affect key financial information, including accounts receivable, inventory, accrued liabilities, net sales, gross profit, operating expenses and net income. In addition, estimating product recall reserves requires a high degree of judgment in areas such as estimating consumer returns, shelf and in-stock inventory at retailers across distribution channels, fees and incentives to be earned by customers for their effort to return the products, future freight rates and consumers’ claims. During the year ended December 31, 2021, the company recorded products recall reserves, specifically for the recall of certain lots of SYMJEPI from the marketplace that was initiated in March 2022. Aside from the approximately $ 0.3 |
Cost of Goods Sold | Cost of Goods Sold The Company’s cost of goods sold includes direct and indirect costs to manufacture formulations and sell products, including active pharmaceutical ingredients, personnel costs, packaging, storage, shipping and handling costs, the write-off of obsolete inventory and other related expenses. |
Stock-Based Compensation | Stock-Based Compensation The Company accounts for transactions in which the Company receives employee services in exchange for restricted stock units (“RSUs”) or options to purchase common stock as stock-based compensation cost based on estimated fair value. 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 Black-Scholes option-pricing model, however, relies on unobservable inputs, in which any significant change in the unobservable inputs reasonably could result in a significantly higher or lower fair value measurement at the reporting date, resulting in higher or lower stock-based compensation that could be material to the Company’s financial statements. |
Research and Development | Research and Development Research and development costs are expensed as incurred. Non-refundable advance payments for goods and services to be used in future research and development activities are recorded as an asset and are expensed when the research and development activities are performed. |
Legal Expense | Legal Expense Legal fees are expensed as incurred and are included in selling, general and administrative expenses on the consolidated statements of operations. |
Income Taxes | Income Taxes The Company accounts for income taxes under the deferred income tax method. Under this method, deferred income taxes are determined based on the estimated future tax effects of differences between the financial statement and tax basis of assets and liabilities given the provisions of enacted tax laws. Deferred income tax provisions and benefits are based on changes to the assets and liabilities from year to year. In providing for deferred taxes, the Company considers tax regulations of the jurisdictions in which they operate, estimates of future taxable income, and available tax planning strategies. If tax regulations, operating results or the ability to implement tax planning strategies vary, adjustments to the carrying value of deferred tax assets and liabilities may be required. Valuation allowances are recorded related to deferred tax assets based on the “more-likely-than-not” criteria. The Company accounts for uncertain tax positions in accordance with accounting guidance which requires the Company to recognize the financial statement benefit of a tax position only after determining that the relevant tax authority would, more likely than not, sustain the position following an audit. For tax positions meeting the more likely than not threshold, the amount recognized in the consolidated financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement with the relevant tax authority. The Company is subject to income taxes in the United States and various states. Tax years since the Company’s inception remain open to examination by the major taxing jurisdictions to which the Company is subject. The Company recognizes interest and penalties accrued related to unrecognized tax benefits in its income tax expense, if any. No interest or penalties have been accrued for any presented periods. The Company sold USC related customer relationship intangibles in the calendar year 2021 and the remaining USC assets and liabilities are classified as held for sale in discontinued operations, and the related tax benefit of approximately $ 67,000 |
Basic and Diluted Net Loss Per Share | Basic and Diluted Net 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 December 31, 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 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 years ended December 31, 2022 and December 31, 2021, consist of outstanding warrants covering 14,952,824 14,202,824 4,436,362 4,985,415 650,000 1,039,003 |
Segment Information | Segment Information Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic No. 280, Segment Reporting (“ASC 280”), establishes standards for the way that public business enterprises report information about operating segments in their annual consolidated financial statements and requires that those enterprises report selected information about operating segments in interim financial reports. ASC 280 also establishes standards for related disclosures about products and services, geographic areas and major customers. The Company’s business segments are based on the organization structure used by the chief operating decision maker for making operating and investment decisions and for assessing performance. Our chief executive officer, who is our chief operating decision maker (“CODM”), manages our operations as operating in two |
Discontinued Operations | Discontinued Operations In accordance with ASC 205-20 Presentation of Financial Statements: Discontinued Operations Assets classified as held for sale that are not sold after the initial one-year period are assessed to determine if they meet the exception to the one-year requirement to continue being classified as held for sale. The primary asset that is held for sale is the USC property with a carrying value of $2.9 million. At December 31, 2022, the Company determined that the exception criteria to continue held for sale classification were met as the Company initiated actions to respond to changes in circumstances and the USC property is being actively marketed at a reasonable price based on its recent market valuation. The Company disposed of a component of its business in August 2021 and met the definition of a discontinued operation as of December 31, 2021. Accordingly, the major current assets, noncurrent assets, current liabilities, and noncurrent liabilities shall be reported as components of total assets and liabilities separate from those balances of the continuing operations as of December 31, 2022 and 2021, and the operating results of the business disposed are reported as loss from discontinued operations in the accompanying consolidated statement of operations for the years ended December 31, 2022 and 2021. For additional information, see Note 4 - Discontinued Operations. |
DISCONTINUED OPERATIONS AND A_2
DISCONTINUED OPERATIONS AND ASSETS HELD FOR SALE (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
DISCONTINUED OPERATIONS | |
The major assets and liabilities associated with discontinued operations included in our consolidated balance sheets are as follows: | The major assets and liabilities associated with discontinued operations included in our consolidated balance sheets are as follows: December 31, December 31 Carrying amounts of major classes of assets included as part of discontinued operations Cash and Cash Equivalents $ 30,085 $ 37,849 Accounts Receivable, net — 693 Inventories — 12,000 Fixed Assets, Held for Sale (i) 6,719,252 6,799,090 Other Assets 5,407 72,469 Less: Loss recognized on classification as held for sale (i) (2,801,828 ) (2,601,442 ) Total assets of the disposal group classified as discontinued operations in the statement of financial position $ 3,952,916 $ 4,320,659 Carrying amounts of major classes of liabilities included as part of discontinued operations Accounts Payable $ 649,633 $ 681,646 Accrued Other Expenses 75,602 133,313 Lease Liabilities 243,008 412,357 Contingent Loss Liability 50,000 410,000 Other Current Liabilities 208,000 — Deferred Tax Liability, net 45,930 45,930 Total liabilities of the disposal group classified as discontinued operations in the statement of financial position $ 1,272,173 $ 1,683,246 |
The revenues and expenses associated with discontinued operations included in our consolidated statements of operations were as follows: | The revenues and expenses associated with discontinued operations included in our consolidated statements of operations were as follows: Year Ended December 31, 2022 2021 Major line items constituting pretax loss of discontinued operations REVENUE, net $ — $ 6,216,545 COST OF GOODS SOLD — (5,620,313 ) — 596,232 SELLING, GENERAL AND ADMINISTRATIVE EXPENSES (462,274 ) (7,802,066 ) RESEARCH AND DEVELOPMENT — (89,710 ) Impairment Expense – Intangible — (3,835,158 ) Impairment Expense – Goodwill — (868,412 ) Impairment Expense – Inventory — (871,180 ) Impairment Expense – Right of Use Asset — (448,141 ) Impairment Expense – Fixed Assets (200,386 ) (9,346 ) Loss from Held for Sale Classification — (2,601,442 ) Total (662,660 ) (15,929,223 ) OTHER INCOME (EXPENSE) Interest Expense — (70,903 ) Interest Income 45 45 Change in Estimate of Contingent Liability 360,000 — Gain on Sale of Assets to Fagron — 4,636,702 Gain on Sale of Fixed Assets 15,138 — Other Income 8,610 68,946 Net Loss from discontinued operations before income taxes (278,867 ) (11,294,433 ) Income Tax Benefit — 66,588 Net Loss from discontinued operations $ (278,867 ) $ (11,227,845 ) |
USC inventories at December 31, 2022 and 2021 consisted of the following: | USC inventories at December 31, 2022 and 2021 consisted of the following: December 31, December 31, Finished Goods $ — $ — Devices — 12,000 Inventories $ — $ 12,000 |
Schedule of restructuring costs | Schedule of restructuring costs Contract Chemical Termination Cost Destruction Costs Total Balance at December 31, 2021 $ 410,000 $ 3,023 $ 413,023 Decrease from change in estimate (360,000 ) — (360,000 ) Payments — (3,023 ) (3,023 ) Balance at December 31, 2022 $ 50,000 $ — $ 50,000 |
REVENUES (Tables)
REVENUES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | |
The following is a rollforward of deferred revenue at December 31, 2022 and 2021: | 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. The following is a rollforward of deferred revenue at December 31, 2022 and 2021: December 31, 2022 December 31, 2021 Opening Balance $ 850,000 $ 950,000 Revenue Recognized (644,000 ) (100,000 ) Ending Balance $ 206,000 $ 850,000 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Inventory Disclosure [Abstract] | |
Inventories at December 31, 2022 and December 31, 2021 consisted of the following: | Inventories at December 31, 2022 and December 31, 2021 consisted of the following: December 31, December 31, Finished Goods $ 267,554 $ — Work-in-Process 261,720 386,610 Raw Materials 709,504 31,997 Total Inventories $ 1,238,778 $ 418,607 |
PREPAID EXPENSES AND OTHER CU_2
PREPAID EXPENSES AND OTHER CURRENT ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Prepaid Expenses And Other Current Assets | |
Prepaid expenses and other current assets at December 31, 2022 and December 31, 2021: | Prepaid expenses and other current assets at December 31, 2022 and December 31, 2021: December 31, December 31, Employee Retention Credit $ 875,307 $ — Prepaid Insurance 323,143 347,511 Prepaid - Research and Development 588,354 115,119 Other Prepaid 78,590 635,620 Other Current Assets 18,621 215,296 $ 1,884,015 $ 1,313,546 |
FIXED ASSETS (Tables)
FIXED ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Fixed assets at December 31, 2022 and December 31, 2021 are summarized in the table below: | Fixed assets at December 31, 2022 and December 31, 2021 are summarized in the table below: Description Useful Life December 31, December 31, Machinery and Equipment 3 7 $ 5,209,575 $ 4,522,583 Less: Accumulated Depreciation (4,665,067 ) (3,181,567 ) Construction In Progress – Equipment (CIP) 744,386 993,752 Fixed Assets, net $ 1,288,894 $ 2,334,768 |
LEASES (Tables)
LEASES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Leases | |
The Company’s weighted average remaining lease term and weighted average discount rate for operating and financing leases as of December 31, 2022 and 2021 are: | The Company’s weighted average remaining lease term and weighted average discount rate for operating and financing leases as of December 31, 2022 and 2021 are: December 31, 2022 Operating Weighted Average Remaining Lease Term 0.92 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 audited consolidated balance sheets as of December 31, 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 audited consolidated balance sheets as of December 31, 2022: Operating 2023 $ 349,365 Undiscounted Future Minimum Lease Payments 349,365 Less: Difference between undiscounted lease payments and discounted lease liabilities 6,803 Total Lease Liabilities $ 342,562 Short-Term Lease Liabilities $ 342,562 Long-Term Lease Liabilities $ — |
ACCRUED OTHER EXPENSES (Tables)
ACCRUED OTHER EXPENSES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Payables and Accruals [Abstract] | |
Accrued other expenses at December 31, 2022 and December 31, 2021: | Accrued other expenses at December 31, 2022 and December 31, 2021: December 31, December 31, Accrued Expenses - R&D $ 42,400 $ 741,521 Accrued Expenses - COGS 1,099,571 658,282 Accrued Expenses - Inventory — 584,731 Accrued Expenses - Other 200,363 500,309 Accrued PTO 167,719 315,398 $ 1,510,053 $ 2,800,241 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 12 Months Ended |
Dec. 31, 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 December 31, 2022 Total Level 1 Level 2 Level 3 Liabilities 2020 Warrant liability $ 7,492 $ — $ — $ 7,492 Total common stock warrant liabilities $ 7,492 $ — $ — $ 7,492 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, 2022 include the expected volatility of the Company’s stock of approximately 70 0.17 0.0 2.68 4.362 Fair Value Measurements at December 31, 2021 Total Level 1 Level 2 Level 3 Liabilities 2020 Warrant liability $ 99,655 $ — $ — $ 99,655 Total common stock warrant liabilities $ 99,655 $ — $ — $ 99,655 |
The following table sets forth a summary of the 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 the changes in the fair value of the Company’s Level 3 financial instruments, which are treated as liabilities, as follows: 2019 Warrant 2020 Warrant Number of Liability Number of Liability (in thousands) (in thousands) Balance at December 31, 2020 13,800,000 $ 2,484,000 8,700,000 $ 2,001,000 Adoption of ASC 2020-06 (13,800,000 ) (2,484,000 ) — — Change in Fair Value of Warrants at Date of Exercise — — — 7,521,150 Exercise of Warrants — — (8,350,000 ) (9,441,650 ) Change in Fair Value, Year ended December 31, 2021 — — — 19,155 Balance at December 31, 2021 — $ — 350,000 $ 99,655 Change in Fair Value, Year ended December, 31, 2022 — — — (92,163 ) Balance at December 31, 2022 — $ — 350,000 $ 7,492 |
STOCK-BASED COMPENSATION, WAR_2
STOCK-BASED COMPENSATION, WARRANTS AND SHARES RESERVED (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
The following summarizes the stock option activity for the year ended December 31, 2022 below: | The following summarizes the stock option activity for the year ended December 31, 2022 below: 2009 Equity Incentive Plan (or, 2009 Plan): 2009 Weighted Weighted * Total Outstanding and Vested and Expected to Vest as of December 31, 2021 4,985,415 $ 4.21 4.05 Options Canceled/Expired (679,053 ) 4.20 — Total Outstanding and Vested as of December 31, 2022 4,306,362 $ 4.21 2.09 * Maximum contractual term for options is 10 years As of December 31, 2022, the unamortized compensation expense related to 2009 Plan awards was approximately $ 0 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 December 31, 2022 and 2021 was $ 0 Non-Plan Awards: Non-Plan Weighted-Average Weighted-Average Total Outstanding, as of December 31, 2021 — $ — — Granted 130,000 0.62 9.13 Total Outstanding as of December 31, 2022 130,000 $ 0.62 9.13 Vested and Expected to Vest at December 31, 2022 57,499 $ 0.62 9.13 |
The following summarizes the RSU activity for the year ended December 31, 2022 below: | The following summarizes the RSU activity for the year ended December 31, 2022 below: Number of Shares/Unit Weighted 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 December 31, 2022 650,000 $ 4.64 |
The following summarizes the non-vested RSU’s as of December 31, 2022: | The following summarizes the non-vested RSU’s as of December 31, 2022: RSUs Price Non-Employee Board of Directors 150,000 (1) $ 8.46 Company Executive and employees 500,000 (1) $ 3.50 Total RSUs 650,000 (1) The RSUs will have cliff vesting after seven years |
The following summaries stock-based compensation recognized as research and development costs (or, R&D) and selling, general and administrative costs (or, SG&A) for the year-ended December 31, 2022 and 2021: | The following summaries stock-based compensation recognized as research and development costs (or, R&D) and selling, general and administrative costs (or, SG&A) for the year-ended December 31, 2022 and 2021: December 31, 2022 December 31, 2021 R&D $ (66,222 ) $ 688,611 SG&A (274,048 ) 1,328,029 Total Stock-based Compensation $ (340,270 ) $ 2,016,640 |
The following table summarizes warrants outstanding at: | The following table summarizes warrants outstanding at: December 31, 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, 2023 January 5, 2028 Total Warrants 14,952,824 * See Note 13 for the fair value of the warrant liability related to the 2020 Warrants which are liability classified. |
At December 31, 2022, the Company has reserved shares of common stock for issuance upon exercise of outstanding options and warrants, and vesting of RSUs, as follows: | At December 31, 2022, the Company has reserved shares of common stock for issuance upon exercise of outstanding options and warrants, and vesting of RSUs, 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 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Net operating losses and tax credit carryforwards as of December 31, 2022 are as follows: | Net operating losses and tax credit carryforwards as of December 31, 2022 are as follows: Amount Expiration Net operating losses, federal (Post December 31, 2017) $ 135,375,006 N/A Net operating losses, federal (Pre January 1, 2018) 86,660,717 2027 2038 Net operating losses, state 91,134,554 2030 2043 Tax credits, federal 3,541,039 2037 2043 Tax credits, state 2,145,442 N/A |
The expense for income taxes from operations consists of the following for the years ended December 31, 2022 and 2021: | The expense for income taxes from operations consists of the following for the years ended December 31, 2022 and 2021: December 31, December 31, Current $ 2,000 $ 2,000 Deferred (46,000 ) (67,000 ) Tax Expense (Benefit) (44,000 ) (65,000 ) Tax Benefit Allocated to Discontinued Operations 46,000 67,000 Tax Expense Allocated to Continuing Operations $ 2,000 $ 2,000 |
At December 31, 2022 and December 31, 2021 the significant components of the deferred tax assets from operations are summarized below (all of which are domestic): | At December 31, 2022 and December 31, 2021 the significant components of the deferred tax assets from operations are summarized below (all of which are domestic): December 31, December 31, Deferred Tax Assets Net Operating Losses Carryforwards $ 51,482,000 $ 47,419,000 Tax Credits 5,686,000 4,982,000 Stock Compensation 746,000 1,008,000 Accrued Expenses 47,000 189,000 Warranty Expenses 75,000 449,000 Intangibles 948,000 1,017,000 Fixed Assets 253,000 127,000 Lease Liabilities 143,000 248,000 R&D Capitalization 1,963,000 — Other 833,000 838,000 Total Deferred Tax Assets 62,176,000 56,277,000 Valuation Allowance (60,227,000 ) (54,261,000 ) Deferred Tax Assets, Net of Valuation Allowance, Total $ 1,949,000 $ 2,016,000 Deferred Tax Liabilities Intangibles - Indefinite Lived $ — $ (187,000 ) Right-of-use Assets (78,000 ) (146,000 ) State Taxes (1,871,000 ) (1,729,000 ) Fixed Assets — — Total Deferred Tax Liabilities (1,949,000 ) (2,062,000 ) Net Deferred Tax Liability $ — $ (46,000 ) |
The following table reconciles the Company’s losses from operations before income taxes for the year ended December 31, 2022 and December 31, 2021: | The following table reconciles the Company’s losses from operations before income taxes for the year ended December 31, 2022 and December 31, 2021: December 31, 2022 December 31, 2021 Federal Statutory Rate $ (5,555,000 ) 21.00 % $ (9,637,000 ) 21.00 % State Income Tax, net of Federal Tax (7,000 ) 0.03 % (9,000 ) 0.02 % Indefinite Lived - DTL (35,000 ) 0.13 % (52,000 ) 0.11 % Other Permanent Differences 682,000 (2.58 %) 1,032,000 (2.25 %) Research and Development Credits (506,000 ) 1.91 % (377,000 ) 0.82 % Other 80,000 (0.30 %) (539,000 ) 1 .17 % Change in Valuation Allowance 5,297,000 (20.02 %) 9,517,000 (20.74 %) Expected Tax Expense $ (44,000 ) 0.17 % $ (65,000 ) 0.13 % |
GOING CONCERN (Details Narrativ
GOING CONCERN (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Net loss | $ (26,478,273) | $ (45,828,198) |
Cash and cash equivalents | 1,081,364 | 23,220,770 |
Accumulated deficit | $ (304,564,086) | $ (278,085,813) |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) | 12 Months Ended | |
Dec. 31, 2022 USD ($) Segment shares | Dec. 31, 2021 USD ($) shares | |
Allowance for doubtful accounts | $ 0 | $ 0 |
Product recall reserve | $ 0 | 0 |
Tax benefit allocated to discontinued operations | $ 67,000 | |
Number of operating segments | Segment | 2 | |
Number of reportable segments | Segment | 2 | |
Warrant [Member] | ||
Potential dilutive securities | shares | 14,952,824 | 14,202,824 |
Share-Based Payment Arrangement, Option [Member] | ||
Potential dilutive securities | shares | 4,436,362 | 4,985,415 |
Restricted Stock Units (RSUs) [Member] | ||
Potential dilutive securities | shares | 650,000 | 1,039,003 |
Property, Plant and Equipment [Member] | Minimum [Member] | ||
Fixed assets, useful lives | 3 years | |
Property, Plant and Equipment [Member] | Maximum [Member] | ||
Fixed assets, useful lives | 5 years | |
SYMJEPI [Member] | ||
Product recall reserve | $ 300,000 |
The major assets and liabilitie
The major assets and liabilities associated with discontinued operations included in our consolidated balance sheets are as follows: (Details) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 | |
Carrying amounts of major classes of assets included as part of discontinued operations | |||
Cash and Cash Equivalents | $ 30,085 | $ 37,849 | |
Accounts Receivable, net | 693 | ||
Inventories | 12,000 | ||
Fixed Assets, Held for Sale | [1] | 6,719,252 | 6,799,090 |
Other Assets | 5,407 | 72,469 | |
Less: Loss recognized on classification as held for sale | [1] | (2,801,828) | (2,601,442) |
Total assets of the disposal group classified as discontinued operations in the statement of financial position | 3,952,916 | 4,320,659 | |
Carrying amounts of major classes of liabilities included as part of discontinued operations | |||
Accounts Payable | 649,633 | 681,646 | |
Accrued Other Expenses | 75,602 | 133,313 | |
Lease Liabilities | 243,008 | 412,357 | |
Contingent Loss Liability | 50,000 | 410,000 | |
Other Current Liabilities | 208,000 | ||
Deferred Tax Liability, net | 45,930 | 45,930 | |
Total liabilities of the disposal group classified as discontinued operations in the statement of financial position | $ 1,272,173 | $ 1,683,246 | |
[1]In January 2023, the Company sold the pods with a carrying value of approximately $ 1 1 |
The revenues and expenses assoc
The revenues and expenses associated with discontinued operations included in our consolidated statements of operations were as follows: (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Major line items constituting pretax loss of discontinued operations | ||
REVENUE, net | $ 6,216,545 | |
COST OF GOODS SOLD | (5,620,313) | |
596,232 | ||
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES | (462,274) | (7,802,066) |
RESEARCH AND DEVELOPMENT | (89,710) | |
Impairment Expense – Intangible | (3,835,158) | |
Impairment Expense – Goodwill | (868,412) | |
Impairment Expense – Inventory | (871,180) | |
Impairment Expense – Right of Use Asset | (448,141) | |
Impairment Expense – Fixed Assets | (200,386) | (9,346) |
Loss from Held for Sale Classification | (2,601,442) | |
Total | (662,660) | (15,929,223) |
OTHER INCOME (EXPENSE) | ||
Interest Expense | (70,903) | |
Interest Income | 45 | 45 |
Change in Estimate of Contingent Liability | 360,000 | |
Gain on Sale of Assets to Fagron | 4,636,702 | |
Gain on Sale of Fixed Assets | 15,138 | |
Other Income | 8,610 | 68,946 |
Net Loss from discontinued operations before income taxes | (278,867) | (11,294,433) |
Income Tax Benefit | 66,588 | |
Net Loss from discontinued operations | $ (278,867) | $ (11,227,845) |
USC inventories at December 31,
USC inventories at December 31, 2022 and 2021 consisted of the following: (Details) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Inventories | $ 12,000 | |
USC [Member] | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Finished Goods | ||
Devices | 12,000 | |
Inventories | $ 0 | $ 12,000 |
Schedule of restructuring costs
Schedule of restructuring costs (Details) | 12 Months Ended |
Dec. 31, 2021 USD ($) | |
Restructuring Cost and Reserve [Line Items] | |
Balance at December 31, 2021 | $ 413,023 |
Decrease from change in estimate | (360,000) |
Payments | (3,023) |
Balance at December 31, 2022 | 50,000 |
Contract Termination [Member] | |
Restructuring Cost and Reserve [Line Items] | |
Balance at December 31, 2021 | 410,000 |
Decrease from change in estimate | (360,000) |
Payments | |
Balance at December 31, 2022 | 50,000 |
Chemical Destruction Costs [Member] | |
Restructuring Cost and Reserve [Line Items] | |
Balance at December 31, 2021 | 3,023 |
Decrease from change in estimate | |
Payments | (3,023) |
Balance at December 31, 2022 |
DISCONTINUED OPERATIONS AND A_3
DISCONTINUED OPERATIONS AND ASSETS HELD FOR SALE (Details Narrative) | 1 Months Ended | 2 Months Ended | 3 Months Ended | 12 Months Ended | |||||
Nov. 10, 2016 USD ($) | Jan. 31, 2023 USD ($) | Mar. 07, 2023 USD ($) | Jun. 30, 2022 USD ($) | Dec. 31, 2022 USD ($) Lease | Dec. 31, 2021 USD ($) | Aug. 31, 2021 | Dec. 31, 2020 USD ($) | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Gain on sale | $ 4,636,702 | ||||||||
Financial advisor fee payable | 700,000 | ||||||||
Loss on True-up of Fagron Variable Consideration | 962,619 | ||||||||
Fixed Assets, Held for Sale | [1] | 6,719,252 | 6,799,090 | ||||||
Valuation allowance | [1] | 2,801,828 | 2,601,442 | ||||||
Loss from Held for Sale Classification - Fixed Assets | 2,601,442 | ||||||||
Percentage of variable consideration receivable | 20% | ||||||||
Impairment Expense - ROU | 448,141 | ||||||||
Lease liabilities | 243,008 | 412,357 | |||||||
Impairment Expense - Intangible | 3,835,158 | ||||||||
Impairment Expense - Goodwill | 868,412 | ||||||||
Impairment Expense - Inventory | 871,180 | ||||||||
Inventory | 12,000 | ||||||||
Reserve for obsolescence | 0 | 0 | |||||||
Restructuring liabilities | 50,000 | $ 413,023 | |||||||
Payments | 3,023 | ||||||||
Decrease from change in estimate | 360,000 | ||||||||
Contract Termination [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Restructuring liabilities | 50,000 | 410,000 | |||||||
Payments | |||||||||
Decrease from change in estimate | 360,000 | ||||||||
Chemical Destruction Costs [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Restructuring liabilities | $ 3,023 | ||||||||
Payments | 3,023 | ||||||||
Decrease from change in estimate | |||||||||
Discontinued Operations [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Asset impairments | 8,600,000 | ||||||||
Discontinued Operations [Member] | Employee Severance [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Restructuring charges | 920,000 | ||||||||
Discontinued Operations [Member] | Contract Termination [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Restructuring charges | 410,000 | ||||||||
Discontinued Operations [Member] | Contract Termination [Member] | Contingent Loss Liability [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Restructuring liabilities | 410,000 | ||||||||
Decrease from change in estimate | 360,000 | ||||||||
Discontinued Operations [Member] | Chemical Destruction Costs [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Restructuring charges | 422,000 | ||||||||
Payments | $ 3,000 | ||||||||
Subsequent Event [Member] | Discontinued Operations [Member] | Contract Termination [Member] | Contingent Loss Liability [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Payments | $ 50,000 | ||||||||
USC [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Fixed Assets, Held for Sale | 6,700,000 | 6,800,000 | |||||||
Valuation allowance | 2,800,000 | 2,600,000 | |||||||
Fixed assets held for sale, net | 3,900,000 | 4,200,000 | |||||||
Loss from Held for Sale Classification - Fixed Assets | 2,601,442 | ||||||||
Impairment Expense - Fixed Assets | $ 200,000 | ||||||||
Standard payment terms | 2%/10 and Net 30 | ||||||||
Number of operating leases | Lease | 2 | ||||||||
Impairment Expense - ROU | 448,000 | ||||||||
Lease liabilities | $ 243,000 | 412,000 | |||||||
Gain from sale of intangible assets | 1,856,000 | ||||||||
Impairment Expense - Intangible | 3,835,000 | ||||||||
Intangible assets | 0 | 0 | |||||||
Impairment Expense - Goodwill | 868,000 | ||||||||
Goodwill | 0 | 0 | |||||||
Right-of-Use Assets | 0 | 0 | |||||||
Impairment Expense - Inventory | 871,000 | ||||||||
Inventory | 0 | 12,000 | |||||||
Reserve for obsolescence | $ 0 | 0 | |||||||
Frequency of debt payment | monthly | ||||||||
Debt payment | $ 19,000 | ||||||||
Debt interest rate | 6% | ||||||||
Interest expense | $ 0 | 49,000 | |||||||
USC [Member] | Contract Termination [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Restructuring charges | 410,000 | ||||||||
USC [Member] | Chemicals [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Impairment Expense - Inventory | 598,000 | ||||||||
USC [Member] | Devices [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Impairment Expense - Inventory | 273,000 | ||||||||
USC [Member] | Minimum [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Remaining lease term | 1 year | ||||||||
USC [Member] | Maximum [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Remaining lease term | 4 years | ||||||||
USC [Member] | Property [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Fixed Assets, Held for Sale | $ 2,946,000 | ||||||||
Fair Value, Held for Sale | 3,200,000 | ||||||||
Fair Value less Cost to Sell, Held for Sale | $ 3,008,000 | ||||||||
Cost to Sell Percentage, Held for Sale | 6% | ||||||||
USC [Member] | Construction in Progress [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Loss from Held for Sale Classification - Fixed Assets | 2,200,000 | ||||||||
USC [Member] | Prefabricated Cleanroom Pods [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Fixed Assets, Held for Sale | $ 972,000 | ||||||||
Proceeds from sale of assets | $ 208,000 | ||||||||
USC [Member] | Prefabricated Cleanroom Pods [Member] | Subsequent Event [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Proceeds from sale of assets | $ 832,000 | ||||||||
USC [Member] | Pods [Member] | Subsequent Event [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Fixed Assets, Held for Sale | 1,000,000 | ||||||||
Proceeds from sale of assets | $ 1,000,000 | ||||||||
USC [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 | ||||||||
USC [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 | ||||||||
USC [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 | ||||||||
USC [Member] | Machinery, Equipment and CIP [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Fixed Assets, Held for Sale | $ 0 | ||||||||
Impairment Expense - Fixed Assets | 200,000 | ||||||||
Fagron Compounding Services LLC [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Fixed consideration for assets sold | 107,000 | ||||||||
Variable consideration | 6,385,000 | ||||||||
Gain on sale | 4,637,000 | ||||||||
Allocated costs related to customer relationships | $ 1,856,000 | ||||||||
Consideration received from purchase agreement | 5,500,000 | ||||||||
Loss on True-up of Fagron Variable Consideration | $ 962,000 | ||||||||
[1]In January 2023, the Company sold the pods with a carrying value of approximately $ 1 1 |
The following is a rollforward
The following is a rollforward of deferred revenue at December 31, 2022 and 2021: (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | ||
Opening Balance | $ 850,000 | $ 950,000 |
Revenue Recognized | (644,000) | (100,000) |
Ending Balance | $ 206,000 | $ 850,000 |
REVENUES (Details Narrative)
REVENUES (Details Narrative) - USD ($) | 12 Months Ended | 24 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2022 | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Recall expense | $ 2,000,000 | $ 2,500,000 | |
Product recall liability | $ 300,000 | $ 2,000,000 | $ 300,000 |
Increase in recognition of deferred revenue | 544,000 | ||
Amortization | 100,000 | ||
Cost of Sales [Member] | |||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Recall expense | 300,000 | ||
Selling, General and Administrative Expenses [Member] | |||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Recall expense | $ 200,000 | ||
USWM Agreement [Member] | |||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Term of agreement | 10 years |
Inventories at December 31, 202
Inventories at December 31, 2022 and December 31, 2021 consisted of the following: (Details) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Inventory Disclosure [Abstract] | ||
Finished Goods | $ 267,554 | |
Work-in-Process | 261,720 | 386,610 |
Raw Materials | 709,504 | 31,997 |
Total Inventories | $ 1,238,778 | $ 418,607 |
INVENTORIES (Details Narrative)
INVENTORIES (Details Narrative) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Inventory Disclosure [Abstract] | ||
Reserve for obsolescence | $ 0 | $ 0 |
Prepaid expenses and other cu_3
Prepaid expenses and other current assets at December 31, 2022 and December 31, 2021: (Details) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Prepaid Expenses And Other Current Assets | ||
Employee Retention Credit | $ 875,307 | |
Prepaid Insurance | 323,143 | 347,511 |
Prepaid - Research and Development | 588,354 | 115,119 |
Other Prepaid | 78,590 | 635,620 |
Other Current Assets | 18,621 | 215,296 |
$ 1,884,015 | $ 1,313,546 |
PREPAID EXPENSES AND OTHER CU_4
PREPAID EXPENSES AND OTHER CURRENT ASSETS (Details Narrative) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Employee Retention Credit | $ 875,307 | |
Internal Revenue Service (IRS) [Member] | ||
Employee Retention Credit | $ 875,000 |
Fixed assets at December 31, 20
Fixed assets at December 31, 2022 and December 31, 2021 are summarized in the table below: (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Property, Plant and Equipment [Line Items] | ||
Machinery and Equipment | $ 5,209,575 | $ 4,522,583 |
Less: Accumulated Depreciation | (4,665,067) | (3,181,567) |
Construction In Progress – Equipment (CIP) | 744,386 | 993,752 |
Fixed Assets, net | $ 1,288,894 | $ 2,334,768 |
Machinery and Equipment [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 3 years | |
Machinery and Equipment [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 7 years |
FIXED ASSETS (Details Narrative
FIXED ASSETS (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation | $ 1,484,000 | $ 1,436,000 |
LEASES (Details Narrative)
LEASES (Details Narrative) | 12 Months Ended | 48 Months Ended | |||
Dec. 29, 2017 | Dec. 31, 2022 USD ($) Lease | Dec. 31, 2021 USD ($) | Nov. 30, 2018 | Dec. 01, 2018 USD ($) | |
Lessee, Lease, Description [Line Items] | |||||
Total rent expense | $ 354,000 | $ 354,000 | |||
Operating lease expense | 354,000 | 354,000 | |||
Cash paid operating lease | $ 371,000 | $ 360,000 | |||
Previous Lease [Member] | |||||
Lessee, Lease, Description [Line Items] | |||||
Lease Expiration Date | Nov. 30, 2018 | ||||
Amended Lease [Member] | |||||
Lessee, Lease, Description [Line Items] | |||||
Lease Expiration Date | Nov. 30, 2023 | ||||
Initial base rent | $ 28,000 | ||||
Increased monthly rent | $ 32,000 | ||||
Office [Member] | |||||
Lessee, Lease, Description [Line Items] | |||||
Number of operating leases | Lease | 1 | ||||
Remaining lease term | 11 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 December 31, 2022 and 2021 are: (Details) | Dec. 31, 2022 | Dec. 31, 2021 |
Leases | ||
Weighted Average Remaining Lease Term | 11 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 audited consolidated balance s (Details) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Leases | ||
2023 | $ 349,365 | |
Undiscounted Future Minimum Lease Payments | 349,365 | |
Less: Difference between undiscounted lease payments and discounted lease liabilities | 6,803 | |
Total Lease Liabilities | 342,562 | |
Short-Term Lease Liabilities | 342,562 | $ 349,871 |
Long-Term Lease Liabilities | $ 342,562 |
Accrued other expenses at Decem
Accrued other expenses at December 31, 2022 and December 31, 2021: (Details) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Payables and Accruals [Abstract] | ||
Accrued Expenses - R&D | $ 42,400 | $ 741,521 |
Accrued Expenses - COGS | 1,099,571 | 658,282 |
Accrued Expenses - Inventory | 584,731 | |
Accrued Expenses - Other | 200,363 | 500,309 |
Accrued PTO | 167,719 | 315,398 |
$ 1,510,053 | $ 2,800,241 |
ACCRUED OTHER EXPENSES (Details
ACCRUED OTHER EXPENSES (Details Narrative) | Dec. 31, 2022 USD ($) |
Accrued Expenses - COGS, firm purchase commitment losses | $ 348,000 |
Accounts Payable [Member] | |
Firm purchase commitments losses | $ 250,000 |
DEBT (Details Narrative)
DEBT (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||||
Apr. 13, 2020 | Jun. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | Mar. 31, 2022 | Aug. 05, 2021 | Mar. 15, 2021 | |
Debt Instrument [Line Items] | ||||||||
Proceeds from debt | $ 1,765,495 | |||||||
Gain (loss) on debt forgiven | $ (1,787,417) | |||||||
Paycheck Protection Plan First Draw Loan [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt amount | $ 0 | |||||||
Gain (loss) on debt forgiven | $ 3,244,095 | |||||||
Paycheck Protection Plan Second Draw Loan [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Gain (loss) on debt forgiven | $ 1,765,495 | |||||||
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) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Warrant liability | $ 7,492 | $ 99,655 |
Fair Value, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total common stock warrant liabilities | 7,492 | 99,655 |
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total common stock warrant liabilities | ||
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total common stock warrant liabilities | ||
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total common stock warrant liabilities | 7,492 | 99,655 |
Fair Value, Recurring [Member] | Warrants 2020 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Warrant liability | 7,492 | 99,655 |
Fair Value, Recurring [Member] | Warrants 2020 [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Warrant liability | ||
Fair Value, Recurring [Member] | Warrants 2020 [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Warrant liability | ||
Fair Value, Recurring [Member] | Warrants 2020 [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Warrant liability | $ 7,492 | $ 99,655 |
The following table sets fort_2
The following table sets forth a summary of the changes in the fair value of the Company’s Level 3 financial instruments, which are treated as liabilities, as follows: (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Number of warrants, ending balance | [1] | 14,952,824 | |
Warrants 2019 Liability [Member] | |||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Number of warrants, beginning balance | 13,800,000 | ||
Warrant liability, beginning balance | $ 2,484,000 | ||
Adoption of ASC 2020-06 (in shares) | (13,800,000) | ||
Adoption of ASC 2020-06 | $ (2,484,000) | ||
Number of warrants, ending balance | |||
Warrant liability, ending balance | |||
Warrants 2020 Liability [Member] | |||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Number of warrants, beginning balance | 350,000 | 8,700,000 | |
Warrant liability, beginning balance | $ 99,655 | $ 2,001,000 | |
Change in Fair Value of Warrants at date of exercise | $ 7,521,150 | ||
Exercise of Warrants (in shares) | (8,350,000) | ||
Exercise of Warrants | $ (9,441,650) | ||
Change in Fair Value of Warrants | $ (92,163) | $ 19,155 | |
Number of warrants, ending balance | 350,000 | 350,000 | |
Warrant liability, ending balance | $ 7,492 | $ 99,655 | |
[1]See Note 13 for the fair value of the warrant liability related to the 2020 Warrants which are liability classified. |
FAIR VALUE MEASUREMENTS (Detail
FAIR VALUE MEASUREMENTS (Details Narrative) - Warrants 2020 [Member] | Dec. 31, 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 | 0.17 | 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 | 2.68 | 3.68 |
Measurement Input, Risk Free Interest Rate [Member] | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Derivative Liability, Measurement Input | 0.04362 | 0.01038 |
LEGAL MATTERS (Details Narrativ
LEGAL MATTERS (Details Narrative) - USD ($) | 1 Months Ended | 12 Months Ended | ||
Oct. 31, 2021 | Jun. 30, 2022 | Dec. 31, 2021 | Feb. 21, 2023 | |
Subsequent Event [Member] | ||||
Loss Contingencies [Line Items] | ||||
Minimum bid price per share requirement | $ 1 | |||
Consent Order [Member] | ||||
Loss Contingencies [Line Items] | ||||
Loss Contingency Accrual, Payments | $ 150,000 | |||
Consent Order [Member] | Civil Penalty [Member] | ||||
Loss Contingencies [Line Items] | ||||
Litigation Settlement, Amount Awarded to Other Party | $ 75,000 | |||
Consent Order [Member] | Investigative Costs [Member] | ||||
Loss Contingencies [Line Items] | ||||
Litigation Settlement, Amount Awarded to Other Party | $ 75,000 | |||
Paycheck Protection Plan Second Draw Loan [Member] | ||||
Loss Contingencies [Line Items] | ||||
Repayment of loan | $ 1,787,417 |
LICENSING AGREEMENTS (Details N
LICENSING AGREEMENTS (Details Narrative) - Tempol [Member] | Jun. 12, 2020 USD ($) shares |
Finite-Lived Intangible Assets [Line Items] | |
Payment for license agreement | $ | $ 250,000 |
Series B Preferred Stock [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Series B Convertible Preferred Stock Issued (in shares) | shares | 1,000,000 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details Narrative) - USD ($) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Oct. 31, 1992 | |
Other Commitments [Line Items] | |||
Maintenance fees | $ 0 | $ 0 | |
Purchases under firm purchase commitments | $ 600,000 | $ 1,100,000 | |
Ben Franklin Note [Member] | |||
Other Commitments [Line Items] | |||
Annual fixed percentage | 3% | ||
Principal amount | $ 777,902 |
COMMON STOCK (Details Narrative
COMMON STOCK (Details Narrative) - USD ($) | 2 Months Ended | 12 Months Ended | |||
Jul. 05, 2022 | Feb. 02, 2021 | Feb. 28, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Class of Warrant or Right [Line Items] | |||||
Proceeds from warrant exercises | $ 5,851,900 | ||||
Number of shares issued | 46,621,621 | ||||
Offering price (in dollars per share) | $ 1.11 | ||||
Proceeds from Issuance of Common Stock | $ 48,400,000 | 51,749,998 | |||
Offering expenses | $ 15,000 | $ 3,300,000 | $ 3,330,752 | ||
Over-Allotment Option [Member] | |||||
Class of Warrant or Right [Line Items] | |||||
Number of shares issued | 6,081,081 | ||||
Warrant [Member] | |||||
Class of Warrant or Right [Line Items] | |||||
Proceeds from warrant exercises | $ 5,852,000 | ||||
Exercise of warrants (in shares) | 8,356,000 | ||||
Warrant [Member] | Minimum [Member] | |||||
Class of Warrant or Right [Line Items] | |||||
Warrant exercise price (in dollars per share) | $ 0.70 | ||||
Warrant [Member] | Maximum [Member] | |||||
Class of Warrant or Right [Line Items] | |||||
Warrant exercise price (in dollars per share) | $ 1.15 |
CONVERTIBLE PREFERRED STOCK (De
CONVERTIBLE PREFERRED STOCK (Details Narrative) | 3 Months Ended | 12 Months Ended | ||||
Jul. 05, 2022 USD ($) $ / shares yr shares | Feb. 02, 2021 USD ($) | Dec. 31, 2022 USD ($) $ / shares shares | Dec. 31, 2022 USD ($) $ / shares shares | Dec. 31, 2021 USD ($) $ / shares shares | ||
Class of Stock [Line Items] | ||||||
Convertible Preferred Stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||
Gross proceeds | $ | $ 300,000 | |||||
Stock issuance costs | $ | $ 15,000 | $ 3,300,000 | 3,330,752 | |||
Fair value of preferred stock | $ | $ 157,303 | $ 157,303 | ||||
Number of warrants outstanding | shares | [1] | 14,952,824 | 14,952,824 | |||
Series C Preferred Warrants [Member] | ||||||
Class of Stock [Line Items] | ||||||
Number of warrants issued | shares | 750,000 | |||||
Warrants exercise price | $ 0.47 | $ 0.47 | $ 0.47 | |||
Warrants exercisable date | Jan. 03, 2023 | |||||
Warramts term end date | Jan. 05, 2028 | Jan. 05, 2028 | Jan. 05, 2028 | |||
Fair value of warrants | $ | $ 127,700 | |||||
Number of warrants outstanding | shares | [1] | 750,000 | 750,000 | |||
Series C Preferred Warrants [Member] | Measurement Input, Share Price [Member] | ||||||
Class of Stock [Line Items] | ||||||
Warrants measurement input | 0.53 | |||||
Series C Preferred Warrants [Member] | Measurement Input, Exercise Price [Member] | ||||||
Class of Stock [Line Items] | ||||||
Warrants measurement input | 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 | |||||
Series C Preferred Stock [Member] | ||||||
Class of Stock [Line Items] | ||||||
Convertible Preferred Stock, par value (in dollars per share) | $ 0.0001 | |||||
Gross proceeds | $ | $ 300,000 | |||||
Voting rights | (i) to vote exclusively on a proposal to effect a reverse stock split of the common stock (the “Proposal”) 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) | $ 100 | |||||
Convertible Preferred Stock, liquidation percentage | 110% | |||||
Convertible Preferred Stock, conversion price percentage | 90% | |||||
Convertible Preferred Stock, conversion price | $ 0.0043 | |||||
Number of shares issued | shares | 3,000 | 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 | |||||
Payment for preferred stock transaction agreement | $ | $ 15,000 | |||||
Series C Preferred Stock [Member] | Maximum [Member] | ||||||
Class of Stock [Line Items] | ||||||
Convertible Preferred Stock, conversion price | $ 0.0060 | |||||
[1]See Note 13 for the fair value of the warrant liability related to the 2020 Warrants which are liability classified. |
The following summarizes the st
The following summarizes the stock option activity for the year ended December 31, 2022 below: (Details) | 12 Months Ended | |
Dec. 31, 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 | [1] |
Options canceled/expired | shares | (679,053) | |
Options canceled/expired, weighted average exercise price | $ / shares | $ 4.20 | |
Total outstanding at ending | shares | 4,306,362 | |
Total outstanding at ending | $ / shares | $ 4.21 | |
Options outstanding, weighted average remaining contractual term at ending | 2 years 1 month 2 days | [1] |
2009 Equity Incentive Plan [Member] | Share-Based Payment Arrangement, Option [Member] | Maximum [Member] | ||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Contractual term | 10 years | |
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 1 month 17 days | |
Total outstanding at ending | shares | 130,000 | |
Total outstanding at ending | $ / shares | $ 0.62 | |
Options outstanding, weighted average remaining contractual term at ending | 9 years 1 month 17 days | |
Vested at ending | shares | 57,499 | |
Options vested, weighted average exercise price at ending | $ / shares | $ 0.62 | |
Options vested, weighted average remaining contractual term | 9 years 1 month 17 days | |
[1]Maximum contractual term for options is 10 years |
The following summarizes the RS
The following summarizes the RSU activity for the year ended December 31, 2022 below: (Details) - Restricted Stock Units (RSUs) [Member] | 12 Months Ended |
Dec. 31, 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 summarizes the no
The following summarizes the non-vested RSU’s as of December 31, 2022: (Details) - Restricted Stock Units (RSUs) [Member] - $ / shares | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | ||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Number of RSUs outstanding | 650,000 | ||
Price per share at grant date | $ 4.64 | $ 4.16 | |
Service period | 7 years | ||
Director [Member] | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Number of RSUs outstanding | [1] | 150,000 | |
Price per share at grant date | $ 8.46 | ||
Company Executives and Employees [Member] | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Number of RSUs outstanding | [1] | 500,000 | |
Price per share at grant date | $ 3.50 | ||
[1]The RSUs will have cliff vesting after seven years |
The following summaries stock-b
The following summaries stock-based compensation recognized as research and development costs (or, R&D) and selling, general and administrative costs (or, SG&A) for the year-ended December 31, 2022 and 2021: (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total Stock-based Compensation | $ (340,270) | $ 2,016,640 |
Research and Development Expense [Member] | ||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total Stock-based Compensation | (66,222) | 688,611 |
Selling, General and Administrative Expenses [Member] | ||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total Stock-based Compensation | $ (274,048) | $ 1,328,029 |
The following table summarizes
The following table summarizes warrants outstanding at: (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2022 | Jul. 05, 2022 | ||
Class of Warrant or Right [Line Items] | |||
Number of warrants outstanding | [1] | 14,952,824 | |
Old Adamis Warrants [Member] | |||
Class of Warrant or Right [Line Items] | |||
Number of warrants outstanding | [1] | 58,824 | |
Warrant exercise price (in dollars per share) | $ 8.50 | ||
Date issued | Nov. 15, 2007 | ||
Warrants expiration date | Nov. 15, 2023 | ||
Warrants 2019 [Member] | |||
Class of Warrant or Right [Line Items] | |||
Number of warrants outstanding | [1] | 13,794,000 | |
Warrant exercise price (in dollars per share) | $ 1.15 | ||
Date issued | Aug. 05, 2019 | ||
Warrants expiration date | Aug. 05, 2024 | ||
Warrants 2020 [Member] | |||
Class of Warrant or Right [Line Items] | |||
Number of warrants outstanding | [1] | 350,000 | |
Warrant exercise price (in dollars per share) | $ 0.70 | ||
Date issued | Feb. 25, 2020 | ||
Warrants expiration date | Sep. 03, 2025 | ||
Series C Preferred Warrants [Member] | |||
Class of Warrant or Right [Line Items] | |||
Number of warrants outstanding | [1] | 750,000 | |
Warrant exercise price (in dollars per share) | $ 0.47 | $ 0.47 | |
Date issued | Jul. 05, 2023 | ||
Warrants expiration date | Jan. 05, 2028 | Jan. 05, 2028 | |
[1]See Note 13 for the fair value of the warrant liability related to the 2020 Warrants which are liability classified. |
At December 31, 2022, the Compa
At December 31, 2022, the Company has reserved shares of common stock for issuance upon exercise of outstanding options and warrants, and vesting of RSUs, as follows: (Details) | Dec. 31, 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 | 12 Months Ended | |||
Jan. 02, 2022 shares | Jun. 30, 2022 USD ($) shares | Dec. 31, 2022 USD ($) d $ / shares shares | Dec. 31, 2020 shares | Dec. 31, 2021 USD ($) | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||||
Number of shares granted | shares | 250,000 | ||||
Expense reversal | $ 540,000 | ||||
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 | |||
Restricted Stock Units (RSUs) [Member] | |||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||||
Unamortized compensation expense | $ 189,000 | ||||
Period for recognition | 10 months 13 days | ||||
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 | ||||
Current shares reserved | shares | 14,171,816 | ||||
Increase in shares reserved for issuance | shares | 7,479,713 | ||||
Equity Incentive Plan 2009 [Member] | |||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||||
Unamortized compensation expense | $ 0 | ||||
Non Plan Awards [Member] | |||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||||
Unamortized compensation expense | $ 0 | ||||
Vesting period | 3 years | ||||
Non Plan Awards [Member] | Share-Based Payment Arrangement, Tranche One [Member] | |||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||||
Vesting percentage | 16.67% | ||||
Vesting period | 6 months | ||||
Non Plan Awards [Member] | Share-Based Payment Arrangement, Tranche Two [Member] | |||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||||
Vesting percentage | 2.78% |
Net operating losses and tax cr
Net operating losses and tax credit carryforwards as of December 31, 2022 are as follows: (Details) | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Domestic Tax Authority [Member] | |
Operating Loss Carryforwards [Line Items] | |
Tax credit carryforwards | $ 3,541,039 |
Domestic Tax Authority [Member] | Minimum [Member] | |
Operating Loss Carryforwards [Line Items] | |
Operating losses expiration years | 2037 |
Domestic Tax Authority [Member] | Maximum [Member] | |
Operating Loss Carryforwards [Line Items] | |
Operating losses expiration years | 2043 |
Domestic Tax Authority [Member] | Tax Year 2017 [Member] | |
Operating Loss Carryforwards [Line Items] | |
Net operating losses | $ 135,375,006 |
Domestic Tax Authority [Member] | Tax Year 2018 [Member] | |
Operating Loss Carryforwards [Line Items] | |
Net operating losses | $ 86,660,717 |
Domestic Tax Authority [Member] | Tax Year 2018 [Member] | Minimum [Member] | |
Operating Loss Carryforwards [Line Items] | |
Operating losses expiration years | 2027 |
Domestic Tax Authority [Member] | Tax Year 2018 [Member] | Maximum [Member] | |
Operating Loss Carryforwards [Line Items] | |
Operating losses expiration years | 2038 |
State and Local Jurisdiction [Member] | |
Operating Loss Carryforwards [Line Items] | |
Net operating losses | $ 91,134,554 |
Tax credit carryforwards | $ 2,145,442 |
State and Local Jurisdiction [Member] | Minimum [Member] | |
Operating Loss Carryforwards [Line Items] | |
Operating losses expiration years | 2030 |
State and Local Jurisdiction [Member] | Maximum [Member] | |
Operating Loss Carryforwards [Line Items] | |
Operating losses expiration years | 2043 |
The expense for income taxes fr
The expense for income taxes from operations consists of the following for the years ended December 31, 2022 and 2021: (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Operating Loss Carryforwards [Line Items] | ||
Tax Expense (Benefit) | $ (44,000) | $ (65,000) |
Income Taxes - Discontinued Operations | 66,588 | |
Tax Expense Allocated to Continuing Operations | 2,000 | 796 |
Tax Year 2022 [Member] | ||
Operating Loss Carryforwards [Line Items] | ||
Current | 2,000 | |
Deferred | (46,000) | |
Tax Expense (Benefit) | (44,000) | |
Income Taxes - Discontinued Operations | 46,000 | |
Tax Expense Allocated to Continuing Operations | $ 2,000 | |
Tax Year 2021 [Member] | ||
Operating Loss Carryforwards [Line Items] | ||
Current | 2,000 | |
Deferred | (67,000) | |
Tax Expense (Benefit) | (65,000) | |
Income Taxes - Discontinued Operations | 67,000 | |
Tax Expense Allocated to Continuing Operations | $ 2,000 |
At December 31, 2022 and Decemb
At December 31, 2022 and December 31, 2021 the significant components of the deferred tax assets from operations are summarized below (all of which are domestic): (Details) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Deferred Tax Assets | ||
Net Operating Losses Carryforwards | $ 51,482,000 | $ 47,419,000 |
Tax Credits | 5,686,000 | 4,982,000 |
Stock Compensation | 746,000 | 1,008,000 |
Accrued Expenses | 47,000 | 189,000 |
Warranty Expenses | 75,000 | 449,000 |
Intangibles | 948,000 | 1,017,000 |
Fixed Assets | 253,000 | 127,000 |
Lease Liabilities | 143,000 | 248,000 |
R&D Capitalization | 1,963,000 | |
Other | 833,000 | 838,000 |
Total Deferred Tax Assets | 62,176,000 | 56,277,000 |
Valuation Allowance | (60,227,000) | (54,261,000) |
Deferred Tax Assets, Net of Valuation Allowance, Total | 1,949,000 | 2,016,000 |
Deferred Tax Liabilities | ||
Intangibles - Indefinite Lived | (187,000) | |
Right-of-use Assets | (78,000) | (146,000) |
State Taxes | (1,871,000) | (1,729,000) |
Fixed Assets | ||
Total Deferred Tax Liabilities | (1,949,000) | (2,062,000) |
Net Deferred Tax Liability | $ (46,000) |
The following table reconciles
The following table reconciles the Company’s losses from operations before income taxes for the year ended December 31, 2022 and December 31, 2021: (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | ||
Federal statutory rate | $ (5,555,000) | $ (9,637,000) |
Effective income tax rate reconciliation, at federal statutory income tax rate, percent | 21% | 21% |
State income tax, net of federal tax | $ (7,000) | $ (9,000) |
State statutory tax rate | 0.03% | 0.02% |
Indefinite Lived - DTL | $ (35,000) | $ (52,000) |
Indefinite Lived - DTL, tax rate | 0.13% | 0.11% |
Other permanent differences | $ 682,000 | $ 1,032,000 |
Other permanent differences tax rate | (2.58%) | (2.25%) |
Research and development credits | $ (506,000) | $ (377,000) |
Research and development credits tax rate | 1.91% | 0.82% |
Other | $ 80,000 | $ (539,000) |
Other rate | (0.30%) | 1% |
Change in valuation allowance | $ 5,297,000 | $ 9,517,000 |
Change in valuation allowance tax rate | (20.02%) | (20.74%) |
Tax Expense (Benefit) | $ (44,000) | $ (65,000) |
Expected tax rate | 0.17% | 0.13% |
INCOME TAXES (Details Narrative
INCOME TAXES (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | ||
Operating Loss Carryforwards, Limitations on Use | federal net operating loss arising in tax years ending after December 31, 2017 will be carried forward indefinitely with an 80% taxable income limitation | |
Valuation allowance adjustment, tax benefit | $ 44,000 | $ 65,000 |
Valuation allowance adjustment, tax benefit, discontinued operation | $ 46,000 | $ 67,000 |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) - USD ($) $ / shares in Units, $ in Millions | Mar. 16, 2023 | Feb. 02, 2021 |
Subsequent Event [Line Items] | ||
Number of shares issued | 46,621,621 | |
Purchase price (in dollars per share) | $ 1.11 | |
Subsequent Event [Member] | ||
Subsequent Event [Line Items] | ||
Number of shares issued | 16,500,000 | |
Purchase price (in dollars per share) | $ 0.125 | |
Warrant exercise price (in dollars per share) | $ 0.138 | |
Warrant exercisable period | 6 months | |
Warrant expiration period | 5 years 6 months | |
Gross proceeds from offering | $ 3 | |
Net proceeds from offering | $ 2.7 | |
Subsequent Event [Member] | Pre-funded Warrants [Member] | ||
Subsequent Event [Line Items] | ||
Number of warrants issued | 7,500,000 | |
Purchase price (in dollars per share) | $ 0.1249 | |
Subsequent Event [Member] | Common Stock Warrants [Member] | ||
Subsequent Event [Line Items] | ||
Number of warrants issued | 48,000,000 |