☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
☐ | TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Large accelerated filer | ☐ | Accelerated Filer | ☒ | |||
Non-accelerated filer | ☐ | Smaller reporting company | ☐ | |||
Emerging growth company | ☐ |
Item 1. | FINANCIAL STATEMENTS |
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Item 2. | 23 | ||||||||
Item 3. | 34 | ||||||||
Item 4. | 35 | ||||||||
PART II. OTHER INFORMATION | |||||||||
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Item 1. | 35 | ||||||||
Item 1A. | 36 | ||||||||
Item 2. | 36 | ||||||||
Item 3. | 36 | ||||||||
Item 4. | 36 | ||||||||
Item 5. | 36 | ||||||||
Item 6. | 36 | ||||||||
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37 |
March 31, | December 31, | |||||||
2020 | 2019 | |||||||
(unaudited) | ||||||||
ASSETS | ||||||||
Current Assets: | ||||||||
Cash and cash equivalents | $ | 101,750,937 | $ | 89,511,710 | ||||
Short-term investments | — | 5,007,050 | ||||||
Accounts receivable, net | 6,918,563 | 10,536,997 | ||||||
Inventory | 2,211,338 | 1,956,792 | ||||||
Prepaid expenses and other current assets | 6,062,715 | 4,351,074 | ||||||
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Total current assets | 116,943,553 | 111,363,623 | ||||||
Operating leaseright-of-use asset | 730,284 | 793,252 | ||||||
Property and equipment, net | 196,926 | 210,467 | ||||||
Deposits | 8,888 | 8,888 | ||||||
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Total assets | $ | 117,879,651 | $ | 112,376,230 | ||||
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LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
Current Liabilities: | ||||||||
Accounts payable | $ | 1,347,577 | $ | 4,117,447 | ||||
Accrued expenses and other liabilities | 16,287,936 | 19,981,295 | ||||||
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Total current liabilities | 17,635,513 | 24,098,742 | ||||||
Operating lease liability, net of current portion | 568,421 | 647,532 | ||||||
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Total liabilities | 18,203,934 | 24,746,274 | ||||||
Commitments and contingencies | ||||||||
Stockholders’ equity: | ||||||||
Preferred stock, $0.001 par value, 5,000,000 shares authorized: none issued and outstanding at March 31, 2020 and December 31, 2019 | — | — | ||||||
Common stock, $0.001 par value, 150,000,000 shares authorized; 103,408,699 shares and 103,397,033 shares issued and outstanding at March 31, 2020 and December 31, 2019, respectively | 103,409 | 103,397 | ||||||
Additionalpaid-in capital | 217,751,166 | 216,205,678 | ||||||
Accumulated deficit | (118,262,609 | ) | (128,688,624 | ) | ||||
Accumulated other comprehensive income (loss) | 83,751 | 9,505 | ||||||
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Total stockholders’ equity | 99,675,717 | 87,629,956 | ||||||
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Total liabilities and stockholders’ equity | $ | 117,879,651 | $ | 112,376,230 | ||||
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September 30, 2020 | December 31, 2019 | |||||||
(unaudited) | ||||||||
ASSETS | ||||||||
Current Assets: | ||||||||
Cash and cash equivalents | $ | 117,105,973 | $ | 89,511,710 | ||||
Short-term investments | 10,002,749 | 5,007,050 | ||||||
Accounts receivable, net | 5,871,893 | 10,536,997 | ||||||
Inventory | 4,747,538 | 1,956,792 | ||||||
Prepaid expenses and other current assets | 5,614,052 | 4,351,074 | ||||||
Total current assets | 143,342,205 | 111,363,623 | ||||||
Deferred tax assets | 31,347,442 | — | ||||||
Operating lease right-of-use | 12,167 | 793,252 | ||||||
Property and equipment, net | 149,119 | 210,467 | ||||||
Deposits | 8,888 | 8,888 | ||||||
Total assets | $ | 174,859,821 | $ | 112,376,230 | ||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
Current Liabilities: | ||||||||
Accounts payable | $ | 2,005,340 | $ | 4,117,447 | ||||
Accrued expenses and other liabilities | 16,226,609 | 19,981,295 | ||||||
Total current liabilities | 18,231,949 | 24,098,742 | ||||||
Operating lease liability, net of current portion | — | 647,532 | ||||||
Total liabilities | 18,231,949 | 24,746,274 | ||||||
Commitments and contingencies | ||||||||
Stockholders’ equity: | ||||||||
Preferred stock, $0.001 par value, 5,000,000 shares authorized: NaN issued and outstanding at September 30, 2020 and December 31, 2019 | 0 | — | ||||||
Common stock, $0.001 par value, 200,000,000 and 150,000,000 shares authorized; 103,648,224 shares and 103,397,033 shares issued and outstanding at September 30, 2020 and December 31, 2019, respectively | 103,648 | 103,397 | ||||||
Additional paid-in capital | 221,673,450 | 216,205,678 | ||||||
Accumulated deficit | (65,142,755 | ) | (128,688,624 | ) | ||||
Accumulated other comprehensive income (loss) | (6,471 | ) | 9,505 | |||||
156,627,872 | 87,629,956 | |||||||
$ | 174,859,821 | $ | 112,376,230 | |||||
For the Three Months Ended March 31, | ||||||||
2020 | 2019 | |||||||
Product revenue, net | $ | 29,136,472 | $ | 12,448,438 | ||||
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Operating costs and expenses: | ||||||||
Cost of sales | 4,150,866 | 1,711,788 | ||||||
Research and development | 4,222,811 | 3,307,959 | ||||||
Selling, general and administrative | 10,063,048 | 8,416,460 | ||||||
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Total operating costs and expenses | 18,436,725 | 13,436,207 | ||||||
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Operating income (loss) | 10,699,747 | (987,769 | ) | |||||
Other income, net | 336,233 | 343,266 | ||||||
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Net income (loss) before income taxes | 11,035,980 | (644,503 | ) | |||||
Provision for income taxes | 609,965 | — | ||||||
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Net income (loss) | $ | 10,426,015 | $ | (644,503 | ) | |||
Net income (loss) per share: | ||||||||
Basic | $ | 0.10 | $ | (0.01 | ) | |||
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Diluted | $ | 0.10 | $ | (0.01 | ) | |||
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Weighted average shares outstanding: | ||||||||
Basic | 103,407,347 | 102,747,923 | ||||||
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Diluted | 106,534,600 | 102,747,923 | ||||||
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Net income (loss) | $ | 10,426,015 | $ | (644,503 | ) | |||
Other comprehensive income (loss): | ||||||||
Unrealized gain (loss) onavailable-for-sale securities | 74,246 | 13,560 | ||||||
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Comprehensive income (loss) | $ | 10,500,261 | $ | (630,943 | ) | |||
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For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
Revenues: | ||||||||||||||||
Product revenue, net | $ | 29,166,658 | $ | 30,897,444 | $ | 87,907,894 | $ | 72,183,782 | ||||||||
Revenues from collaborative arrangements | 150,000 | — | 150,000 | — | ||||||||||||
Total revenues | 29,316,658 | 30,897,444 | 88,057,894 | 72,183,782 | ||||||||||||
Operating costs and expenses: | ||||||||||||||||
Cost of sales | 3,878,760 | 4,387,461 | 12,169,499 | 10,360,874 | ||||||||||||
Research and development | 3,749,233 | 4,597,039 | 12,321,687 | 12,534,362 | ||||||||||||
Selling, general and administrative | �� | 9,984,961 | 8,067,792 | 30,881,367 | 25,471,974 | |||||||||||
Total operating costs and expenses | 17,612,954 | 17,052,292 | 55,372,553 | 48,367,210 | ||||||||||||
Operating income (loss) | 11,703,704 | 13,845,152 | 32,685,341 | 23,816,572 | ||||||||||||
Other income, net | 33,567 | 393,415 | 481,069 | 1,187,091 | ||||||||||||
Net income (loss) before income taxes | 11,737,271 | 14,238,567 | 33,166,410 | 25,003,663 | ||||||||||||
Income tax provision (benefit) | (31,602,596 | ) | 608,388 | (30,379,459 | ) | 1,058,039 | ||||||||||
Net income (loss) | $ | 43,339,867 | $ | 13,630,179 | $ | 63,545,869 | $ | 23,945,624 | ||||||||
Net income (loss) per share: | ||||||||||||||||
Basic | $ | 0.42 | $ | 0.13 | $ | 0.61 | $ | 0.23 | ||||||||
Diluted | $ | 0.41 | $ | 0.13 | $ | 0.60 | $ | 0.23 | ||||||||
Weighted average shares outstanding: | ||||||||||||||||
Basic | 103,535,431 | 102,974,105 | 103,452,025 | 102,864,571 | ||||||||||||
Diluted | 106,316,241 | 107,045,234 | 106,386,617 | 105,821,609 | ||||||||||||
Net income (loss) | $ | 43,339,867 | $ | 13,630,179 | $ | 63,545,869 | $ | 23,945,624 | ||||||||
Other comprehensive income (loss): | ||||||||||||||||
Unrealized gain (loss) on available-for-sale | (5,280 | ) | (2,330 | ) | (15,976 | ) | 39,676 | |||||||||
Comprehensive income (loss) | $ | 43,334,587 | $ | 13,627,849 | $ | 63,529,893 | $ | 23,985,300 | ||||||||
Common Stock | Additional | Accumulated Other | ||||||||||||||||||||||||||
Preferred Stock | Shares | Amount | Paid-in Capital | Accumulated Deficit | Comprehensive Gain (Loss) | Total | ||||||||||||||||||||||
Balance at December 31, 2019 | $ | — | 103,397,033 | $ | 103,397 | $ | 216,205,678 | $ | (128,688,624 | ) | $ | 9,505 | $ | 87,629,956 | ||||||||||||||
Issuance of stock options for services | — | — | — | 1,383,672 | — | — | 1,383,672 | |||||||||||||||||||||
Exercise of stock options for common stock | — | 11,666 | 12 | 26,137 | — | — | 26,149 | |||||||||||||||||||||
Amortization of restricted stock for services | — | — | — | 135,679 | — | — | 135,679 | |||||||||||||||||||||
Other comprehensive gain (loss) | — | — | — | — | — | 74,246 | 74,246 | |||||||||||||||||||||
Net income (loss) | — | — | — | — | 10,426,015 | — | 10,426,015 | |||||||||||||||||||||
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Balance at March 31, 2020 | $ | — | 103,408,699 | $ | 103,409 | $ | 217,751,166 | $ | (118,262,609 | ) | $ | 83,751 | $ | 99,675,717 | ||||||||||||||
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Common Stock | Additional | Accumulated Other | ||||||||||||||||||||||||||
Preferred Stock | Shares | Amount | Paid-in Capital | Accumulated Deficit | Comprehensive Gain (Loss) | Total | ||||||||||||||||||||||
Balance at December 31, 2018 | $ | — | 102,739,257 | $ | 102,739 | $ | 211,265,279 | $ | (160,563,961 | ) | $ | (20,248 | ) | $ | 50,783,809 | |||||||||||||
Issuance of stock options for services | — | — | — | 933,411 | — | — | 933,411 | |||||||||||||||||||||
Exercise of stock options for common stock | — | 65,000 | 65 | 89,285 | — | — | 89,350 | |||||||||||||||||||||
Other comprehensive gain (loss) | — | — | — | — | — | 13,560 | 13,560 | |||||||||||||||||||||
Net income (loss) | — | — | — | — | (644,503 | ) | — | (644,503 | ) | |||||||||||||||||||
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Balance at March 31, 2019 | $ | — | 102,804,257 | $ | 102,804 | $ | $212,287,975 | $ | (161,208,464 | ) | $ | (6,688 | ) | $ | 51,175,627 | |||||||||||||
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Preferred | Common Stock | Additional Paid-in | Accumulated | Accumulated Other Comprehensive | ||||||||||||||||||||||||
Stock | Shares | Amount | Capital | Deficit | Gain (Loss) | Total | ||||||||||||||||||||||
Balance at December 31, 2019 | $ | — | 103,397,033 | $ | 103,397 | $ | 216,205,678 | $ | (128,688,624 | ) | $ | 9,505 | $ | 87,629,956 | ||||||||||||||
Issuance of stock options for services | — | — | — | 1,383,672 | — | — | 1,383,672 | |||||||||||||||||||||
Exercise of stock options for common stock | — | 11,666 | 12 | 26,137 | — | — | 26,149 | |||||||||||||||||||||
Amortization of restricted stock for services | — | — | — | 135,679 | — | — | 135,679 | |||||||||||||||||||||
Other comprehensive gain (loss) | — | — | — | — | — | 74,246 | 74,246 | |||||||||||||||||||||
Net income (loss) | — | — | — | — | 10,426,015 | — | 10,426,015 | |||||||||||||||||||||
Balance at March 31, 2020 | — | 103,408,699 | 103,409 | 217,751,166 | (118,262,609 | ) | 83,751 | 99,675,717 | ||||||||||||||||||||
Issuance of stock options for services | — | — | — | 1,627,105 | — | — | 1,627,105 | |||||||||||||||||||||
Exercise of stock options for common stock | — | 13,333 | 13 | 36,188 | — | — | 36,201 | |||||||||||||||||||||
Amortization of restricted stock for services | — | — | — | 167,357 | — | — | 167,357 | |||||||||||||||||||||
Other comprehensive gain (loss) | — | — | — | — | — | (84,942 | ) | (84,942 | ) | |||||||||||||||||||
Net income (loss) | — | — | — | — | 9,779,987 | — | 9,779,987 | |||||||||||||||||||||
Balance at June 30, 2020 | — | 103,422,032 | 103,422 | 219,581,816 | (108,482,622 | ) | (1,191 | ) | 111,201,425 | |||||||||||||||||||
Issuance of stock options for services | — | — | — | 1,345,962 | — | — | 1,345,962 | |||||||||||||||||||||
Exercise of stock options for common stock | — | 215,097 | 215 | 630,833 | — | — | 631,048 | |||||||||||||||||||||
Amortization of restricted stock for services | — | — | — | 131,884 | — | — | 131,884 | |||||||||||||||||||||
Issuance of common stock upon vesting of restricted stock | — | 11,095 | 11 | (17,045 | ) | — | — | (17,034 | ) | |||||||||||||||||||
Other comprehensive gain (loss) | — | — | — | — | — | (5,280 | ) | (5,280 | ) | |||||||||||||||||||
Net income (loss) | — | — | — | — | 43,339,867 | — | 43,339,867 | |||||||||||||||||||||
Balance at September 30, 2020 | $ | — | 103,648,224 | $ | 103,648 | $ | 221,673,450 | $ | (65,142,755 | ) | $ | (6,471 | ) | $ | 156,627,872 | |||||||||||||
Preferred | Common Stock | Additional Paid-in | Accumulated | Accumulated Other Comprehensive | ||||||||||||||||||||||||
Stock | Shares | Amount | Capital | Deficit | Gain (Loss) | Total | ||||||||||||||||||||||
Balance at December 31, 2018 | $ | — | 102,739,257 | $ | 102,739 | $ | 211,265,279 | $ | (160,563,961 | ) | $ | (20,248 | ) | $ | 50,783,809 | |||||||||||||
Issuance of stock options for services | — | — | — | 933,411 | — | — | 933,411 | |||||||||||||||||||||
Exercise of stock options for common stock | — | 65,000 | 65 | 89,285 | — | — | 89,350 | |||||||||||||||||||||
Other comprehensive gain (loss) | — | — | — | — | — | 13,560 | 13,560 | |||||||||||||||||||||
Net income (loss) | — | — | — | — | (644,503 | ) | — | (644,503 | ) | |||||||||||||||||||
Balance at March 31, 2019 | — | 102,804,257 | 102,804 | 212,287,975 | (161,208,464 | ) | (6,688 | ) | 51,175,627 | |||||||||||||||||||
Issuance of stock options for services | — | — | — | 924,996 | — | — | 924,996 | |||||||||||||||||||||
Exercise of stock options for common stock | — | 125,000 | 125 | 192,425 | — | — | 192,550 | |||||||||||||||||||||
Other comprehensive gain (loss) | — | — | — | — | — | 28,446 | 28,446 | |||||||||||||||||||||
Net income (loss) | — | — | — | — | 10,959,948 | — | 10,959,948 | |||||||||||||||||||||
Balance at June 30, 2019 | — | 102,929,257 | 102,929 | 213,405,396 | (150,248,516 | ) | 21,758 | 63,281,567 | ||||||||||||||||||||
Issuance of stock options for services | — | — | — | 817,060 | — | — | 817,060 | |||||||||||||||||||||
Exercise of stock options for common stock | — | 111,776 | 112 | 255,950 | — | — | 256,062 | |||||||||||||||||||||
Other comprehensive gain (loss) | — | — | — | — | — | (2,330 | ) | (2,330 | ) | |||||||||||||||||||
Net income (loss) | — | — | — | — | 13,630,179 | — | 13,630,179 | |||||||||||||||||||||
Balance at September 30, 2019 | $ | — | 103,041,033 | $ | 103,041 | $ | 214,478,406 | $ | (136,618,337 | ) | $ | 19,428 | $ | 77,982,538 | ||||||||||||||
For the Three Months Ended March 31, | ||||||||
2020 | 2019 | |||||||
Operating Activities: | ||||||||
Net income (loss) | $ | 10,426,015 | $ | (644,503 | ) | |||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||||||||
Depreciation | 13,541 | 13,748 | ||||||
Amortization ofright-of-use asset | 62,968 | 59,621 | ||||||
Stock-based compensation | 1,519,351 | 933,411 | ||||||
Change in accrued interest and accretion of discount on investments | 81,296 | (53,674 | ) | |||||
(Increase) decrease in: | ||||||||
Accounts receivable, net | 3,618,434 | (7,251,381 | ) | |||||
Inventory | (254,546 | ) | (40,575 | ) | ||||
Prepaid expenses and other current assets and deposits | (1,711,641 | ) | (231,485 | ) | ||||
Increase (decrease) in: | ||||||||
Accounts payable | (2,769,870 | ) | 602,719 | |||||
Accrued expenses and other liabilities | (3,699,518 | ) | (1,337,155 | ) | ||||
Operating lease liability | (72,952 | ) | (67,155 | ) | ||||
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Net cash provided by (used in) operating activities | 7,213,078 | (8,016,429 | ) | |||||
Investing Activities: | ||||||||
Purchases of property and equipment | — | (5,633 | ) | |||||
Purchases of investments | — | (9,944,974 | ) | |||||
Proceeds from maturities and sales of investments | 5,000,000 | 20,400,000 | ||||||
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Net cash provided by (used in) investing activities | 5,000,000 | 10,449,393 | ||||||
Financing Activities: | ||||||||
Proceeds from exercise of stock options | 26,149 | 89,350 | ||||||
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Net cash provided by (used in) financing activities | 26,149 | 89,350 | ||||||
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Net increase (decrease) in cash and cash equivalents | 12,239,227 | 2,522,314 | ||||||
Cash and cash equivalents—beginning of period | 89,511,710 | 16,559,400 | ||||||
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Cash and cash equivalents—end of period | $ | 101,750,937 | $ | 19,081,714 | ||||
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Non-cash investing and financing activities: | ||||||||
Unrealized gain (loss) onavailable-for-sale securities | $ | 74,246 | $ | 13,560 |
For the Nine Months Ended September 30, | ||||||||
2020 | 2019 | |||||||
Operating Activities: | ||||||||
Net income (loss) | $ | 63,545,869 | $ | 23,945,624 | ||||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||||||||
Depreciation | 72,746 | 26,718 | ||||||
Amortization of right-of-use | 781,085 | 181,301 | ||||||
Stock-based compensation | 4,791,659 | 2,675,467 | ||||||
Deferred taxes | (31,347,442 | ) | — | |||||
Change in accrued interest and accretion of discount on investments | (11,675 | ) | (185,536 | ) | ||||
(Increase) decrease in: | ||||||||
Accounts receivable, net | 4,665,104 | (10,095,352 | ) | |||||
Inventory | (2,790,746 | ) | (543,789 | ) | ||||
Prepaid expenses and other current assets and deposits | (1,262,978 | ) | (1,689,618 | ) | ||||
Increase (decrease) in: | ||||||||
Accounts payable | (2,112,107 | ) | 1,809,662 | |||||
Accrued expenses and other liabilities | (3,568,729 | ) | 6,400,279 | |||||
Operating lease liability | (833,489 | ) | (204,724 | ) | ||||
Net cash provided by (used in) operating activities | 31,929,297 | 22,320,032 | ||||||
Investing Activities: | ||||||||
Purchases of property and equipment | (11,398 | ) | (19,370 | ) | ||||
Purchases of investments | (10,000,000 | ) | (34,725,401 | ) | ||||
Proceeds from maturities and sales of investments | 5,000,000 | 40,310,595 | ||||||
Net cash provided by (used in) investing activities | (5,011,398 | ) | 5,565,824 | |||||
Financing Activities: | ||||||||
Payment of employee withholding tax related to stock-based compensation | (17,034 | ) | — | |||||
Proceeds from exercise of stock options | 693,398 | 537,962 | ||||||
Net cash provided by (used in) financing activities | 676,364 | 537,962 | ||||||
Net increase (decrease) in cash and cash equivalents | 27,594,263 | 28,423,818 | ||||||
Cash and cash equivalents—beginning of period | 89,511,710 | 16,559,400 | ||||||
Cash and cash equivalents—end of period | $ | 117,105,973 | $ | 44,983,218 | ||||
Supplemental disclosures of cash flow information: | ||||||||
Cash paid for income taxes | $ | 2,195,000 | $ | — | ||||
Non-cash investing and financing activities: | ||||||||
Unrealized gain (loss) on available-for-sale | $ | (15,976 | ) | $ | 39,676 |
1. | Organization and Description of Business. |
2. | Basis of Presentation and Significant Accounting Policies. |
a. |
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In the opinion of management, the accompanying unaudited interim consolidated financial statements of the Company contain all adjustments (consisting of only normal recurring adjustments) necessary to present fairly the financial position of the Company as of the dates and for the periods presented. Accordingly, these consolidated statements should be read in conjunction with the financial statements and notes thereto for the year ended December 31, 2019 included in the 2019 Annual Report on Formthreenine months ended March 31,September 30, 2020 are not necessarily indicative of the results to be expected for any future period or for the full 2020 fiscal year.
2. | Basis of Presentation and Significant Accounting Policies (continued). |
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Short-Term Bond Fund
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U.S. Treasuries
U.S. Treasuries are classified asavailable-for-sale securities U.S. Treasuries with stated maturities of greater than three months and less than one year asin short-term investments.Available-for-sale securitiesinvestments, U.S Treasuries with stated maturities greater than one year are classified as
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2. | Basis of Presentation and Significant Accounting Policies (continued). |
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2. | Basis of Presentation and Significant Accounting Policies (continued). |
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Fair Value Measurements at Reporting Date Using | ||||||||||||||||
Balances as of March 31, 2020 | Quoted Prices in Active Markets for Identical Assets/Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | |||||||||||||
Cash and cash equivalents: | ||||||||||||||||
Money market funds | $ | 23,610,888 | $ | 23,610,888 | $ | — | $ | — | ||||||||
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U.S. Treasuries | $ | 69,997,200 | $ | — | $ | 69,997,200 | $ | — | ||||||||
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Balances as of December 31, 2019 | Quoted Prices in Active Markets for Identical Assets/Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | |||||||||||||
Cash and cash equivalents: | ||||||||||||||||
Money market funds | $ | 23,963,617 | $ | 23,963,617 | $ | — | $ | — | ||||||||
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U.S. Treasuries | $ | 59,932,200 | $ | — | $ | 59,932,200 | $ | — | ||||||||
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Short-term investments: | ||||||||||||||||
U.S. Treasuries | $ | 5,007,050 | $ | — | $ | 5,007,050 | $ | — | ||||||||
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Fair Value Measurements at Reporting Date Using | ||||||||||||||||
Balances as of September 30, 2020 | Quoted Prices in Active Markets for Identical Assets/Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | |||||||||||||
Cash and cash equivalents: | ||||||||||||||||
Money market funds | $ | 12,635,927 | $ | 12,635,927 | $ | — | $ | — | ||||||||
U.S. Treasuries | $ | 94,992,100 | $ | — | $ | 94,992,100 | $ | — | ||||||||
Short-term investments: | ||||||||||||||||
Short-term bond funds | $ | 10,002,749 | $ | 10,002,749 | $ | — | $ | — | ||||||||
Balances as of December 31, 2019 | Quoted Prices in Active Markets for Identical Assets/Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | |||||||||||||
Cash and cash equivalents: | ||||||||||||||||
Money market funds | $ | 23,963,617 | $ | 23,963,617 | $ | — | $ | — | ||||||||
U.S. Treasuries | $ | 59,932,200 | $ | — | $ | 59,932,200 | $ | — | ||||||||
Short-term investments: | ||||||||||||||||
U.S. Treasuries | $ | 5,007,050 | $ | — | $ | 5,007,050 | $ | — | ||||||||
k. |
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l. |
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2. | Basis of Presentation and Significant Accounting Policies (continued). |
September 30, 2020 and 2019.
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2. | Basis of Presentation and Significant Accounting Policies (continued). |
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2. | Basis of Presentation and Significant Accounting Policies (continued). |
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No milestones were achieved in the three and nine months ended September 30, 2020 and 2019.
m. |
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2. | Basis of Presentation and Significant Accounting Policies (continued). |
n. |
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o. |
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p. |
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q. |
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2. | Basis of Presentation and Significant Accounting Policies (continued). |
r. |
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s. |
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For the Three Months Ended March 31, | ||||||||
2020 | 2019 | |||||||
Basic weighted average common shares outstanding | 103,407,347 | 102,747,923 | ||||||
Effect of dilutive securities: | ||||||||
Unvested restricted stock units subject to vesting requirements issued to employees andnon-employees | 352,500 | — | ||||||
Common stock issuable upon the exercise of stock options | 2,774,753 | — | ||||||
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Diluted weighted average common shares outstanding | 106,534,600 | 102,747,923 | ||||||
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For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
Basic weighted average common shares outstanding | 103,535,431 | 102,974,105 | 103,452,025 | 102,864,571 | ||||||||||||
Effect of dilutive securities | 2,780,810 | 4,071,129 | 2,934,592 | 2,957,038 | ||||||||||||
Dilutive weighted average common shares outstanding | 106,316,241 | 107,045,234 | 106,386,617 | 105,821,609 | ||||||||||||
t. |
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u. |
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2. | Basis of Presentation and Significant Accounting Policies (continued). |
3. | Investments. |
At March 31, 2020: U.S. Treasuries – Cash equivalents At December 31, 2019: U.S. Treasuries – Cash equivalents U.S. Treasuries – ST Total Estimated
Fair Value Gross
Unrealized
Gains Gross
Unrealized
Losses Amortized
Cost $ 69,997,200 $ 83,751 $ — $ 69,913,449 $ 59,932,200 $ 2,042 $ — $ 59,930,158 5,007,050 7,463 — 4,999,587 $ 64,939,250 $ 9,505 $ — $ 64,929,745
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Estimated Fair Value | Gross Unrealized Gains | Gross Unrealized Losses | Amortized Cost | |||||||||||||
At September 30, 2020: | ||||||||||||||||
U.S. Treasuries – Cash equivalents | $ | 94,992,100 | $ | — | $ | (1,195 | ) | $ | 94,993,295 | |||||||
Bond Funds – ST | 10,002,749 | — | (5,276 | ) | 10,008,025 | |||||||||||
Total | $ | 104,994,849 | $ | — | $ | (6,471 | ) | $ | 105,001,320 | |||||||
At December 31, 2019 : | ||||||||||||||||
U.S. Treasuries – Cash equivalents | $ | 59,932,200 | $ | 2,042 | $ | — | $ | 59,930,158 | ||||||||
U.S. Treasuries – ST | 5,007,050 | 7,463 | — | 4,999,587 | ||||||||||||
Total | $ | 64,939,250 | $ | 9,505 | $ | — | $ | 64,929,745 | ||||||||
The Company did not hold any securities in an unrealized position for more than 12 months as of March 31,September 30, 2020.
March 31, 2020 | ||||
Due in one year or less | $ | 69,997,200 | ||
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September 30, 2020 | ||||
Due in one year or less | $ | 104,994,849 | ||
4. | Prepaid Expenses and Other Current Assets. |
March 31, 2020 | December 31, 2019 | |||||||
Prepaid manufacturing costs | $ | 3,471,078 | $ | 1,526,013 | ||||
Prepaid insurance | 995,146 | 1,263,129 | ||||||
Prepaid subscription fees | 492,716 | 501,251 | ||||||
Prepaid research fees | 490,102 | 481,057 | ||||||
Prepaid commercialization expenses | 287,083 | 62,959 | ||||||
Other | 326,590 | 516,665 | ||||||
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Total prepaid expenses and other current assets | $ | 6,062,715 | $ | 4,351,074 | ||||
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September 30, 2020 | December 31, 2019 | |||||||
Prepaid manufacturing costs | $ | 3,268,032 | $ | 1,526,013 | ||||
Prepaid insurance | 247,610 | 1,263,129 | ||||||
Prepaid subscription fees | 561,430 | 501,251 | ||||||
Prepaid research fees | 472,093 | 481,057 | ||||||
Prepaid commercialization expenses | 168,611 | 62,959 | ||||||
Due from collaborative arrangements | 306,678 | — | ||||||
Other | 589,598 | 516,665 | ||||||
Total prepaid expenses and other current assets | $ | 5,614,052 | $ | 4,351,074 | ||||
5. | Operating Leases. |
March 31, 2020 | ||||
Operating lease cost | $ | 74,079 |
For the Three Months Ended September 30, 2020 | For the Nine Months Ended September 30, 2020 | |||||||
Operating lease cost | $ | 61,111 | $ | 200,624 |
March 31, 2020 | ||||
Cash paid for amounts included in the measurement of lease liabilities: | ||||
Operating cash flows | $ | 84,061 | ||
Right-of-use assets obtained in exchange for lease obligations: | ||||
Operating leases | $ | 5,305 |
September 30, 2020 | ||||
Cash paid for amounts included in the measurement of lease liabilities: | ||||
Operating cash flows | $ | 253,024 | ||
Right-of-use | ||||
Operating leases | $ | 37,528 |
March 31, 2020 | ||||
Operating leaseright-of-use assets | $ | 730,284 | ||
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Other current liabilities | $ | 306,677 | ||
Operating lease liabilities, net of current portion | 568,421 | |||
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Total operating lease liabilities | $ | 875,098 | ||
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September 30, 2020 | ||||
Operating lease right-of-use | $ | 12,167 | ||
Other current liabilities | $ | 114,563 | ||
Operating lease liabilities, net of current portion | — | |||
Total operating lease liabilities | $ | 114,563 | ||
Weighted average remaining lease term | 0.3 years | |||
Weighted average discount rate | 3.68 | % |
2020 (remaining nine months) | $ | 255,544 | ||
2021 | 349,788 | |||
2022 | 329,662 | |||
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Total lease payments | 934,994 | |||
Less imputed interest | (59,896 | ) | ||
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Total | $ | 875,098 | ||
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2020 (remaining three months) | $ | 86,582 | ||
2021 | 28,860 | |||
2022 | — | |||
Total lease payments | 115,442 | |||
Less imputed interest | (879 | ) | ||
Total | $ | 114,563 | ||
6. | Accrued Expenses and Other Liabilities. |
March 31, 2020 | December 31, 2019 | |||||||
Accrued preclinical and clinical trial expenses | $ | 940,963 | $ | 1,183,513 | ||||
Accrued professional fees | 3,309,351 | 1,241,526 | ||||||
Accrued compensation and benefits | 1,814,396 | 3,064,645 | ||||||
Accrued license fees | 3,945,991 | 8,751,991 | ||||||
Accrued purchases | 1,243,991 | 1,313,310 | ||||||
Accrued contributions | 1,135,000 | 1,535,000 | ||||||
Operating lease liability | 306,677 | 300,518 | ||||||
Accrued variable consideration | 1,308,344 | 884,764 | ||||||
Income tax payable | 2,143,490 | 1,533,696 | ||||||
Other | 139,733 | 172,332 | ||||||
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Current accrued expenses and other liabilities | 16,287,936 | 19,981,295 | ||||||
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Leaseliability—non-current | 568,421 | 647,532 | ||||||
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Non-current accrued expenses and other liabilities | 568,421 | 647,532 | ||||||
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Total accrued expenses and other liabilities | $ | 16,856,357 | $ | 20,628,827 | ||||
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September 30, 2020 | December 31, 2019 | |||||||
Accrued preclinical and clinical trial expenses | $ | 643,578 | $ | 1,183,513 | ||||
Accrued professional fees | 1,923,164 | 1,241,526 | ||||||
Accrued compensation and benefits | 2,877,077 | 3,064,645 | ||||||
Accrued license fees | 7,840,955 | 8,751,991 | ||||||
Accrued purchases | 1,332,190 | 1,313,310 | ||||||
Accrued contributions | — | 1,535,000 | ||||||
Operating lease liability | 114,563 | 300,518 | ||||||
Accrued variable consideration | 859,399 | 884,764 | ||||||
Accrued income tax | 566,075 | 1,533,696 | ||||||
Other | 69,608 | 172,332 | ||||||
Current accrued expenses and other liabilities | 16,226,609 | 19,981,295 | ||||||
Lease liability—non-current | — | 647,532 | ||||||
Non-current accrued expenses and other liabilities | — | 647,532 | ||||||
Total accrued expenses and other liabilities | $ | 16,226,609 | $ | 20,628,827 | ||||
7. | Collaborative |
|
7. | Collaborative Arrangement s (continued). |
8. | Commitments and Contingencies. |
9. | Agreements. |
a. |
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b. |
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10. | Income Taxes. |
11. | Stockholders’ Equity. |
March 31,September 30, 2020 and December 31, 2019. NoNaN shares of preferred stock were outstanding at March 31,September 30, 2020 and December 31, 2019.11.Stockholders’ Equity (continued).The Company has 150,000,000 shares ofshare.share, from 150,000,000March 31,September 30, 2020 and December 31, 2019, 103,408,699103,648,224 and 103,397,033 shares, respectively, of common stock were issued and outstanding. Each holder of common stock is entitled to one1 vote of each share of common stock held of record on all matters on which stockholders generally are entitled to vote.201712, 2017,23, 2020, the Company filed a universal shelf Registration Statement on FormS-3 (the 2017 Shelf Registration Statement)registration statement with the SEC to sell up to $150$200 million of common stock, preferred stock, warrants to purchase common stock, or debt securities (including debtand units consisting of one or more of such securities that may be convertible or exchangeable for common stock or other securities), which securities may be offered separately or together in units or multiple series.(the “2020 Shelf Registration Statement”). The 20172020 Shelf Registration Statement (fileNo. 333-219259) no.26, 2017.On November 28, 2017,31, 2020. As of the Company filed a prospectus supplement and offered for sale 16,428,572 sharesdate of its common stock at a price of $3.50 per share in an underwritten public offeringthis report, no offerings have been completed under the 2017 Shelf Registration. The Company received gross proceeds in the public offering of approximately $57.5 million before underwriting commission and incurred expenses of approximately $3.7 million.At March 31,Company’s 2020 there is approximately $92.5 million available for future sale under the 2017 Shelf Registration Statement.
12. | Stock Compensation. |
Three months ended March 31, | ||||||||
2020 | 2019 | |||||||
Research and development | $ | 418,053 | $ | 287,721 | ||||
Selling, general and administrative | 1,101,298 | 645,690 | ||||||
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Total stock-based compensation | $ | 1,519,351 | $ | 933,411 | ||||
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Three months ended September 30, | Nine months ended September 30, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
Research and development | $ | 399,247 | $ | 242,867 | $ | 1,238,521 | $ | 803,800 | ||||||||
Selling, general and administrative | 1,078,599 | 574,193 | 3,553,138 | 1,871,667 | ||||||||||||
Total stock-based compensation | $ | 1,477,846 | $ | 817,060 | $ | 4,791,659 | $ | 2,675,467 | ||||||||
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There were no grants of
13. | Subsequent Events. |
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the COVID-19
We were fortunate that all subjects were enrolled in Further,
We have
We recently completed the last subject visits in
We were fortunate
If our trial is successful, we intend to file a supplemental new drug application (sNDA) with the FDA for theMUSK-MG indication.
treatment LEMS. We are currently conductingcontinuing to provide Firdapse
In October 2019, we submitted an NDS in
of the results of this proceeding.
Japan or obtain orphan drug designation.
Further, there
At September 30, 2020, we generated revenues of $150,000 from
We
valuation allowance accordingly.
Three months ended September 30, | Change | |||||||||||||||
2020 | 2019 | $ | % | |||||||||||||
Research and development expenses | $ | 3,349,986 | $ | 4,354,172 | (1,004,186 | ) | (23.1 | ) | ||||||||
Employee stock-based compensation | 399,247 | 242,867 | 156,380 | 64.4 | ||||||||||||
Total research and development expenses | $ | 3,749,233 | $ | 4,597,039 | (847,806 | ) | (18.4 | ) | ||||||||
Three months ended March 31, | Change | |||||||||||||||
2020 | 2019 | $ | % | |||||||||||||
Research and development expenses | $ | 3,804,758 | $ | 3,020,238 | 784,520 | 26.0 | % | |||||||||
Employee stock-based compensation | 418,053 | 287,721 | 130,332 | 45.3 | % | |||||||||||
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Total research and development expenses | $ | 4,222,811 | $ | 3,307,959 | 914,852 | 27.7 | % | |||||||||
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Nine months ended September 30, | Change | |||||||||||||||
2020 | 2019 | $ | % | |||||||||||||
Research and development expenses | $ | 11,083,166 | $ | 11,730,562 | (647,396 | ) | (5.5 | ) | ||||||||
Employee stock-based compensation | 1,238,521 | 803,800 | 434,721 | 54.1 | ||||||||||||
Total research and development expenses | $ | 12,321,687 | $ | 12,534,362 | (212,675 | ) | (1.7 | ) | ||||||||
decreases in medical and regulatory affairs and quality assurance expenses and expenses from our ongoing clinical trials evaluating Firdapse ® for the treatment ofMuSK-MG as we close out that trial, and ourproof-of-concept ® for the treatment |
increase of $130,332SMA Type 3; and
Three months ended March 31, | Change | |||||||||||||||
2020 | 2019 | $ | % | |||||||||||||
Selling | $ | 5,804,145 | $ | 5,103,908 | 700,237 | 13.7 | % | |||||||||
General and administrative | 3,157,605 | 2,666,862 | 490,743 | 18.4 | % | |||||||||||
Employee stock-based compensation | 1,101,298 | 645,690 | 455,608 | 70.6 | % | |||||||||||
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Total selling, general and administrative expenses | $ | 10,063,048 | $ | 8,416,460 | 1,646,588 | 19.6 | % | |||||||||
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Three months ended September 30, | Change | |||||||||||||||
2020 | 2019 | $ | % | |||||||||||||
Selling | $ | 5,578,521 | $ | 4,670,568 | 907,953 | 19.4 | ||||||||||
General and administrative | 3,327,841 | 2,823,031 | 504,810 | 17.9 | ||||||||||||
Employee stock-based compensation | 1,078,599 | 574,193 | 504,406 | 87.8 | ||||||||||||
Total selling, general and administrative expenses | $ | 9,984,961 | $ | 8,067,792 | 1,917,169 | 23.8 | ||||||||||
Nine months ended September 30, | Change | |||||||||||||||
2020 | 2019 | $ | % | |||||||||||||
Selling | $ | 17,004,447 | $ | 14,655,613 | 2,348,834 | 16.0 | ||||||||||
General and administrative | 10,323,782 | 8,944,694 | 1,379,088 | 15.4 | ||||||||||||
Employee stock-based compensation | 3,553,138 | 1,871,667 | 1,681,471 | 89.8 | ||||||||||||
Total selling, general and administrative expenses | $ | 30,881,367 | $ | 25,471,974 | 5,409,393 | 21.2 | ||||||||||
increase of approximately $0.7 million
increases in general and administrative expenses, which are primarily due to the expansion |
increase of approximately $0.5 millionour operations and headcount to support our ongoing efforts to expand our net revenues from sales of Firdapse
$0.29 per diluted share) on the basis of management’s determination that it is more likely than not that the amount of its deferred tax assets will be realized.
approximately $0.8 million and $2.7 million, respectively.
|
31, 2020. As of the date of this Form10-Q, $92.5 million of our 2017report, no offerings have been completed under the 2020 Shelf Registration Statement remains available for future sales.
Statement.
$34,725,401.
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a. | We have carried out an evaluation, under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and15d-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Based on such evaluation, our principal executive officer and principal financial officer have concluded that as of |
b. | During the three months ended |
Ruzurgiallegesalleged that the FDA’s approval of Ruzurgiseekssought an order vacating the FDA’s approval of RuzurgiWe recentlymotionReport and Recommendation in which she recommended to the District Judge handling the case that she grant the FDA’s and Jacobus’ motions for summary judgement inand deny our case, and the FDA has filed a cross motion for summary judgement. Further,On September 29, 2020, the District Judge handling the Company’s lawsuit against the FDA adopted the previously reported Report and Recommendation of the Magistrate Judge, granted summary judgement in favor of the FDA and Jacobus, and dismissed the Company’s case. The Company has intervened in our case and filed their own cross-motion for summary judgement. Based on currently available information, we expect that there will be a decision inappealed the case sometime later this year.result to the Eleventh Circuit Court of Appeals. There can be no assurance as to the outcome of this lawsuit.timingU.S. District Court for New Jersey against Jacobus, and a lawsuit in the U.S. District Court for the Western District of any decision, or Pennsylvania against PantherRx Rare LLC (PantherRx) for infringement of our patent for Firdapselikelihood’893 patent. The lawsuit arises from Jacobus’ and PantherRx’s sales and marketing of an appeal if our suit is successful.
31.1 | ||
31.2 | ||
32.1 | ||
32.2 | ||
101.INS | Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. | |
101.SCH | Inline XBRL Taxonomy Extension Schema Document | |
101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document | |
101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document | |
101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document | |
101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document | |
104 | The cover page for the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2020, has been formatted in Inline XBRL. |
Catalyst Pharmaceuticals, Inc. | ||
By: | /s/ Alicia Grande | |
Alicia Grande | ||
Vice President, Treasurer and Chief Financial Officer |
41