Document And Entity Information
Document And Entity Information - shares | 6 Months Ended | |
Jun. 30, 2020 | Aug. 05, 2020 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2020 | |
Document Transition Report | false | |
Entity File Number | 001-32639 | |
Entity Registrant Name | TG THERAPEUTICS, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 36-3898269 | |
Entity Address, Address Line One | 2 Gansevoort Street, 9th Floor | |
Entity Address, City or Town | New York | |
Entity Address, State or Province | NY | |
Entity Address, Postal Zip Code | 10014 | |
City Area Code | 212 | |
Local Phone Number | 554-4484 | |
Title of 12(b) Security | Common Stock | |
Trading Symbol | TGTX | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 126,649,205 | |
Entity Central Index Key | 0001001316 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 260,512 | $ 112,637 |
Short-term investment securities | 15,058 | 27,798 |
Prepaid research and development | 3,832 | 8,105 |
Other current assets | 1,536 | 611 |
Total current assets | 280,938 | 149,151 |
Restricted cash | 1,255 | 1,251 |
Leasehold interest, net | 2,157 | 2,129 |
Equipment, net | 331 | 282 |
Right of use asset | 9,141 | 9,402 |
Goodwill | 799 | 799 |
Total assets | 294,621 | 163,014 |
Current liabilities: | ||
Accounts payable and accrued expenses | 29,670 | 30,041 |
Other current liabilities | 25,572 | 48,994 |
Loan payable - current portion | 7,200 | |
Lease liability - current portion | 1,655 | 1,616 |
Accrued compensation | 3,440 | 3,798 |
Total current liabilities | 67,537 | 84,449 |
Deferred revenue, net of current portion | 686 | 762 |
Long-term debt | 22,233 | 28,970 |
Lease liability - non-current | 9,938 | 10,218 |
Total liabilities | 100,394 | 124,399 |
Commitments and contingencies | ||
Stockholders' equity: | ||
Common stock, $0.001 par value per share (150,000,000 shares authorized, 126,690,514 and 109,425,243 shares issued, 126,649,205 and 109,383,934 shares outstanding at June 30, 2020 and December 31, 2019, respectively) | 127 | 109 |
Additional paid-in capital | 999,549 | 739,956 |
Treasury stock, at cost, 41,309 shares at June 30, 2020 and December 31, 2019 | (234) | (234) |
Accumulated deficit | (805,215) | (701,216) |
Total stockholders' equity | 194,227 | 38,615 |
Total liabilities and stockholders' equity | $ 294,621 | $ 163,014 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Jun. 30, 2020 | Dec. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 150,000,000 | 150,000,000 |
Common stock, shares issued | 126,690,514 | 109,425,243 |
Common stock, shares outstanding | 126,649,205 | 109,383,934 |
Treasury stock, shares | 41,309 | 41,309 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Income Statement [Abstract] | ||||
License revenue | $ 38 | $ 38 | $ 76 | $ 76 |
Research and development: | ||||
Noncash stock expense associated with in-licensing agreements | 100 | 100 | ||
Noncash compensation | 1,553 | 1,352 | 3,532 | 2,841 |
Other research and development | 34,896 | 31,414 | 68,939 | 62,310 |
Total research and development | 36,449 | 32,866 | 72,471 | 65,251 |
General and administrative: | ||||
Noncash compensation | 5,817 | 405 | 14,906 | 797 |
Other general and administrative | 8,617 | 2,311 | 13,789 | 4,260 |
Total general and administrative | 14,434 | 2,716 | 28,695 | 5,057 |
Total costs and expenses | 50,883 | 35,582 | 101,166 | 70,308 |
Operating loss | (50,845) | (35,544) | (101,090) | (70,232) |
Other expense (income) : | ||||
Interest expense | 2,228 | 1,077 | 3,429 | 1,851 |
Other income | (189) | (408) | (519) | (715) |
Total other expense, net | 2,039 | 669 | 2,910 | 1,136 |
Net loss | $ (52,884) | $ (36,213) | $ (104,000) | $ (71,368) |
Basic and diluted net loss per common share (in dollars per share) | $ (0.47) | $ (0.42) | $ (0.95) | $ (0.85) |
Weighted average shares used in computing basic and diluted net loss per common share (in shares) | 112,353,414 | 86,800,017 | 108,926,690 | 84,002,700 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Equity - USD ($) $ in Thousands | Common Stock [Member] | Additional Paid-in Capital [Member] | Treasury Stock [Member] | Accumulated Deficit [Member] | Total |
Balance at Dec. 31, 2018 | $ 84 | $ 552,531 | $ (234) | $ (528,345) | $ 24,036 |
Balance (in shares) at Dec. 31, 2018 | 83,911,855 | 41,309 | |||
Issuance of restricted stock (in shares) | 23,000 | ||||
Warrants issued with debt financing | 993 | 993 | |||
Forfeiture of restricted stock (in shares) | (67,628) | ||||
Issuance of common stock in At-the-Market offerings (net of offering costs) | $ 5 | 27,494 | 27,499 | ||
Issuance of common stock in At-the-Market offerings (net of offering costs) (in shares) | 4,715,000 | ||||
Compensation in respect of restricted stock granted to employees, directors and consultants | 1,882 | 1,882 | |||
Net loss | (35,156) | (35,156) | |||
Balance at Mar. 31, 2019 | $ 89 | 582,900 | $ (234) | (563,501) | 19,254 |
Balance (in shares) at Mar. 31, 2019 | 88,582,227 | 41,309 | |||
Balance at Dec. 31, 2018 | $ 84 | 552,531 | $ (234) | (528,345) | 24,036 |
Balance (in shares) at Dec. 31, 2018 | 83,911,855 | 41,309 | |||
Net loss | (71,368) | ||||
Balance at Jun. 30, 2019 | $ 93 | 613,059 | $ (234) | (599,713) | 13,205 |
Balance (in shares) at Jun. 30, 2019 | 93,405,168 | 41,309 | |||
Balance at Mar. 31, 2019 | $ 89 | 582,900 | $ (234) | (563,501) | 19,254 |
Balance (in shares) at Mar. 31, 2019 | 88,582,227 | 41,309 | |||
Issuance of restricted stock | $ 1 | (1) | |||
Issuance of restricted stock (in shares) | 1,245,000 | ||||
Forfeiture of restricted stock (in shares) | (38,418) | ||||
Issuance of common stock (net of offering costs) | 11 | 11 | |||
Issuance of common stock in At-the-Market offerings (net of offering costs) | $ 3 | 28,392 | 28,395 | ||
Issuance of common stock in At-the-Market offerings (net of offering costs) (in shares) | 3,616,359 | ||||
Compensation in respect of restricted stock granted to employees, directors and consultants | 1,757 | 1,757 | |||
Net loss | (36,212) | (36,213) | |||
Balance at Jun. 30, 2019 | $ 93 | 613,059 | $ (234) | (599,713) | 13,205 |
Balance (in shares) at Jun. 30, 2019 | 93,405,168 | 41,309 | |||
Balance at Dec. 31, 2019 | $ 109 | 739,956 | $ (234) | (701,216) | 38,615 |
Balance (in shares) at Dec. 31, 2019 | 109,425,243 | 41,309 | |||
Issuance of common stock in connection with exercise of warrants | 80 | 80 | |||
Issuance of common stock in connection with exercise of warrants (in shares) | 19,750 | ||||
Issuance of restricted stock | $ 1 | (1) | |||
Issuance of restricted stock (in shares) | 774,300 | ||||
Forfeiture of restricted stock (in shares) | (10,000) | ||||
Compensation in respect of restricted stock granted to employees, directors and consultants | 11,068 | 11,068 | |||
Net loss | (51,116) | (51,116) | |||
Balance at Mar. 31, 2020 | $ 110 | 751,103 | $ (234) | (752,332) | (1,353) |
Balance (in shares) at Mar. 31, 2020 | 110,209,293 | 41,309 | |||
Balance at Dec. 31, 2019 | $ 109 | 739,956 | $ (234) | (701,216) | 38,615 |
Balance (in shares) at Dec. 31, 2019 | 109,425,243 | 41,309 | |||
Net loss | (104,000) | ||||
Balance at Jun. 30, 2020 | $ 127 | 999,550 | $ (234) | (805,216) | 194,227 |
Balance (in shares) at Jun. 30, 2020 | 126,690,514 | 41,309 | |||
Balance at Mar. 31, 2020 | $ 110 | 751,103 | $ (234) | (752,332) | (1,353) |
Balance (in shares) at Mar. 31, 2020 | 110,209,293 | 41,309 | |||
Issuance of common stock in connection with exercise of warrants | 16 | 16 | |||
Issuance of common stock in connection with exercise of warrants (in shares) | 3,750 | ||||
Issuance of restricted stock | $ 2 | (2) | |||
Issuance of restricted stock (in shares) | 2,208,529 | ||||
Forfeiture of restricted stock (in shares) | (41,666) | ||||
Issuance of common stock (net of offering costs) | $ 10 | 165,032 | 165,042 | ||
Issuance of common stock (net of offering costs) (in shares) | 9,775,000 | ||||
Issuance of common stock in At-the-Market offerings (net of offering costs) | $ 5 | 76,031 | 76,036 | ||
Issuance of common stock in At-the-Market offerings (net of offering costs) (in shares) | 4,535,608 | ||||
Compensation in respect of restricted stock granted to employees, directors and consultants | 7,370 | 7,370 | |||
Net loss | (52,884) | (52,884) | |||
Balance at Jun. 30, 2020 | $ 127 | $ 999,550 | $ (234) | $ (805,216) | $ 194,227 |
Balance (in shares) at Jun. 30, 2020 | 126,690,514 | 41,309 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Equity (Parenthetical) - USD ($) $ in Millions | Jun. 30, 2020 | Jun. 30, 2019 | Mar. 31, 2019 |
Statement of Stockholders' Equity [Abstract] | |||
Offering costs | $ 10.9 | ||
Offering costs, at market | $ 1.4 | $ 1.4 | $ 0.2 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net loss | $ (104,000) | $ (71,368) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Noncash stock compensation expense | 18,438 | 3,639 |
Noncash licensing expense | 100 | |
Depreciation and amortization | 64 | 46 |
Amortization of premium on investment securities | (69) | (149) |
Amortization of debt issuance costs | 463 | 308 |
Amortization of leasehold interest | 110 | 91 |
Non-cash change in lease liability and right-of-use asset | 2,455 | 902 |
Change in fair value of notes payable | 152 | 78 |
Changes in assets and liabilities: | ||
Decrease in other current assets | 3,211 | 572 |
Decrease in leasehold interest | 91 | |
Decrease (increase) in accrued interest receivable | 41 | (10) |
Decrease in accounts payable and accrued expenses | (728) | (5,588) |
Decrease in lease liabilities | (2,436) | (678) |
(Decrease) increase in interest payable | (110) | 443 |
(Decrease) increase in other liabilities | (23,464) | 2,388 |
Decrease in deferred revenue | (76) | (76) |
Net cash used in operating activities | (105,949) | (69,211) |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Proceeds from maturity of short-term securities | 20,250 | 13,500 |
Investment in held-to-maturity securities | (7,482) | (14,146) |
Purchases of equipment | (113) | (32) |
Net cash provided by (used in) investing activities | 12,655 | (678) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Proceeds from sale of common stock, net | 241,077 | 55,965 |
Proceeds from exercise of options | 96 | |
Proceeds from debt financings | 29,679 | |
Financing costs paid | (480) | |
Net cash provided by financing activities | 241,173 | 85,164 |
NET INCREASE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH | 147,879 | 15,275 |
CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT BEGINNING OF PERIOD | 113,888 | 43,199 |
CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT END OF PERIOD | $ 261,767 | $ 58,474 |
Condensed Consolidated Statem_5
Condensed Consolidated Statements of Cash Flows (Parenthetical) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Reconciliation to amounts on condensed consolidated balance sheets: | ||
Cash and cash equivalents | $ 260,512 | $ 57,228 |
Restricted cash | 1,255 | 1,246 |
Total cash, cash equivalents and restricted cash | 261,767 | 58,474 |
Cash paid for: | ||
Interest | $ 1,555 | 1,051 |
NONCASH TRANSACTIONS | ||
Accrued offering costs | 60 | |
Deferred financing costs | 988 | |
Warrants issued with debt financing | 993 | |
Shares issued in connection with in-licensing | $ 100 |
ORGANIZATION AND SUMMARY OF SIG
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jun. 30, 2020 | |
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 1 ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Description of Business We are a biopharmaceutical company dedicated to developing and delivering medicines for patients with B-cell mediated diseases, including chronic lymphocytic leukemia (CLL), non-Hodgkin lymphoma (NHL) and multiple sclerosis (MS). We have developed a robust B-cell directed research and development (R&D) platform for identification of key B-cell pathways of interest and rapid clinical testing. Currently, we have five B-cell targeted drug candidates in clinical development, with the two lead therapies, ublituximab (TG-1101) and umbralisib (TGR-1202), in pivotal trials for CLL and NHL, with ublituximab also in pivotal trials for MS. Ublituximab is a novel anti-CD20 monoclonal antibody (mAb) that has been glycoengineered for enhanced potency. Umbralisib is an oral, once daily, dual inhibitor of PI3K-delta and CK1-epsilon. When used together in combination therapy, ublituximab and umbralisib are referred to as “U2”. Additionally, in early clinical development we have an anti-PD-L1 monoclonal antibody referred to as cosibelimab (TG-1501), an oral Bruton’s Tyrosine Kinase (BTK) inhibitor referred to as TG-1701, and an anti-CD47/CD19 bispecific antibody referred to as TG-1801. We also actively evaluate complementary products, technologies and companies for in-licensing, partnership, acquisition and/or investment opportunities. To date, we have not received approval for the sale of any of our drug candidates in any market and, therefore, have not generated any product sales from our drug candidates. The accompanying unaudited condensed consolidated financial statements were prepared in accordance with U.S. generally accepted accounting principles, or “GAAP”, for interim financial information and with the instructions to Quarterly Report on Form 10-Q and Article 10 of Regulation S-X of the Exchange Act. Accordingly, they may not include all of the information and footnotes required by GAAP for complete financial statements. All adjustments that are, in the opinion of management, of a normal recurring nature and are necessary for a fair presentation of the condensed consolidated financial statements have been included. Nevertheless, these condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements contained in our Annual Report on Form 10-K for the year ended December 31, 2019. The accompanying condensed December 31, 2019 balance sheet has been derived from these statements. The results of operations for the six months ended June 30, 2020 are not necessarily indicative of the results that may be expected for the entire fiscal year or any other interim period. In December 2018, the Company created an Australian corporation, TG Therapeutics AUS Pty Ltd. (“TG AUS”), as a wholly-owned subsidiary. This corporation’s functional currency, the Australian dollar, is also its reporting currency, and its financial statements are translated to U.S. dollars, the Company’s reporting currency, prior to consolidation. The activities of TG AUS result in immaterial currency translation adjustments and, thus, are included in Other Income/Expense on the Company’s condensed consolidated statement of operations. The accompanying condensed consolidated financial statements include the accounts of the Company and its subsidiaries, and all intercompany accounts and transactions have been eliminated in consolidation. Liquidity and Capital Resources We have incurred operating losses since our inception, expect to continue to incur operating losses for the foreseeable future, and may never become profitable. As of June 30, 2020, we have an accumulated deficit of approximately $805.2 million. Our major sources of cash have been proceeds from the private placement and public offering of equity securities, as well as debt financings. We have not yet commercialized any of our drug candidates and cannot be sure if we will ever be able to do so. Even if we commercialize one or more of our drug candidates, we may not become profitable. Our ability to achieve profitability depends on many factors, including our ability to obtain regulatory approval for our drug candidates; successfully complete any post-approval regulatory obligations; and successfully commercialize our drug candidates alone or in partnership. We may continue to incur substantial operating losses even if we begin to generate revenues from our drug candidates. As of June 30, 2020, we had $275.6 million in cash and cash equivalents, and investment securities. The Company believes its cash, cash equivalents, and investment securities on hand as of June 30, 2020 will provide sufficient liquidity for more than a twelve-month period from the date of filing this Quarterly Report on Form 10-Q. The actual amount of cash that we will need to operate is subject to many factors, including, but not limited to, the timing, design and conduct of clinical trials for our drug candidates. We are dependent upon significant future financing to provide the cash necessary to execute our current operations, including the commercialization of any of our drug candidates. Our common stock is listed on the Nasdaq Capital Market and trades under the symbol TGTX. Recently Issued Accounting Standards In July 2018, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update (“ASU”) No. 2018-11, “Leases - Targeted Improvements” (“ASU 2018-11”) as an update to ASU 2016-02, Leases (“ASU 2016-02” or “Topic 842”) issued on February 25, 2016. ASU 2016-02 is effective for public business entities for fiscal years beginning January 1, 2019. ASU 2016-02 required companies to adopt the new leases standard at the beginning of the earliest period presented in the financial statements, which is January 1, 2017, using a modified retrospective transition method where lessees must recognize lease assets and liabilities for all leases even though those leases may have expired before the effective date of January 1, 2017. Lessees must also provide the new and enhanced disclosures for each period presented, including the comparative periods. ASU 2018-11 provides an entity with an additional (and optional) transition method to adopt the new leases standard. Under this new transition method, an entity initially applies the new lease standard at the adoption date and recognizes a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. Consequently, an entity’s reporting for the comparative periods presented in the financial statements in which it adopts the new lease standard will continue to be in accordance with Accounting Standard Codification (“ASC”) 840, Leases (“ASC 840”). An entity that elects this additional (and optional) transition method must provide the required ASC 840 disclosures for all periods that continue to be in accordance with ASC 840. The amendments do not change the existing disclosure requirements in ASC 840. ASU 2018-11 was effective for public business entities for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years, with earlier adoption permitted. The Company adopted ASU 2018-11 on January 1, 2019 using a modified retrospective method and has not restated comparative periods. We elected the package of practical expedients permitted under the transition guidance, which allows us to carryforward our historical lease classification and our assessment on whether a contract is or contains a lease. The adoption of this guidance resulted in the addition of material balances of right of use assets and lease liabilities to our consolidated balance sheets at January 1, 2019, primarily relating to our lease of office space (see Note 8). The impact to our consolidated statements of operations was not material as a result of this standard. In June 2018, the FASB issued ASU No. 2018-07, “Improvements to Nonemployee Share-Based Payment Accounting” (“ASU 2018-07”). ASU 2018-07 expands the scope of FASB Topic 718, “Compensation – Stock Compensation” (“Topic 718”) to include share-based payment transactions for acquiring goods and services from nonemployees. An entity should only remeasure equity-classified awards for which a measurement date has not been established through a cumulative-effect adjustment to retained earnings as of the beginning of the fiscal year of adoption. Upon transition, the entity is required to measure these nonemployee awards at fair value as of the adoption date. The entity must not remeasure assets that are completed. Disclosures required at transition include the nature of and reason for the change in accounting principle and, if applicable, quantitative information about the cumulative effect of the change on retained earnings or other components of equity. ASU 2018-07 was effective for public business entities for fiscal years beginning after December 15, 2018, including interim periods within that fiscal year. Early adoption was permitted, but no earlier than an entity’s adoption date of ASC Topic 606, “Revenue from Contracts with Customers” (“ASC 606”). The Company adopted ASU 2018-07 on January 1, 2019. The adoption of ASU 2018-07 did not have a material effect on our consolidated financial statements as of January 1, 2019. The adoption of ASU 2018-07 had no impact on nonemployee performance awards as they are measured based on the outcome that is probable. Other pronouncements issued by the FASB or other authoritative accounting standards with future effective dates are either not applicable or not significant to our condensed consolidated financial statements. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and judgments that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the applicable reporting period. On an ongoing basis, we evaluate our estimates and judgments, including those related to accrued expenses and stock-based compensation. Actual results could differ from those estimates. Such differences could be material to the financial statements. Cash and Cash Equivalents We treat liquid investments with original maturities of less than three months when purchased as cash and cash equivalents. Restricted Cash We record cash pledged or held in trust as restricted cash. As of June 30, 2020 and December 31, 2019, we have approximately $1.3 million of restricted cash pledged to secure a line of credit as a security deposit for an Office Agreement (see Note 8). Investment Securities Investment securities at June 30, 2020 and December 31, 2019 consist of short-term government securities. We classify these securities as held-to-maturity. Held-to-maturity securities are those securities in which we have the ability and intent to hold the security until maturity. Held-to-maturity securities are recorded at amortized cost, adjusted for the amortization or accretion of premiums or discounts. Premiums and discounts are amortized or accreted over the life of the related held-to-maturity security as an adjustment to yield using the effective interest method. A decline in the market value of any investment security below cost, that is deemed to be other than temporary, results in a reduction in the carrying amount to fair value. The impairment is charged to operations and a new cost basis for the security is established. Other-than-temporary impairment charges are included in interest and other income (expense), net. Unrealized gains, if determined to be temporary, are included in accumulated other comprehensive income in equity. Dividend and interest income are recognized when earned. Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents and short-term investments. The Company maintains its cash and cash equivalents and short-term investments with high-credit quality financial institutions. At times, such amounts may exceed federally-insured limits. Revenue Recognition The Company recognizes revenue under ASC 606. The core principle of this revenue standard is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. The following five steps are applied to achieve that core principle: ● Step 1: Identify the contract with the customer ● Step 2: Identify the performance obligations in the contract ● Step 3: Determine the transaction price ● Step 4: Allocate the transaction price to the performance obligations in the contract ● Step 5: Recognize revenue when the company satisfies a performance obligation In order to identify the performance obligations in a contract with a customer, a company must assess the promised goods or services in the contract and identify each promised good or service that is distinct. A performance obligation meets ASC 606’s definition of a “distinct” good or service (or bundle of goods or services) if both of the following criteria are met: ● The customer can benefit from the good or service either on its own or together with other resources that are readily available to the customer (i.e., the good or service is capable of being distinct); and ● The entity’s promise to transfer the good or service to the customer is separately identifiable from other promises in the contract (i.e., the promise to transfer the good or service is distinct within the context of the contract). If a good or service is not distinct, the good or service is combined with other promised goods or services until a bundle of goods or services is identified that is distinct. The transaction price is the amount of consideration to which an entity expects to be entitled in exchange for transferring promised goods or services to a customer, excluding amounts collected on behalf of third parties (for example, some sales taxes). The consideration promised in a contract with a customer may include fixed amounts, variable amounts, or both. Variable consideration is included in the transaction price only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. The transaction price is allocated to each performance obligation on a relative standalone selling price basis. The transaction price allocated to each performance obligation is recognized when that performance obligation is satisfied, at a point in time or over time as appropriate. Research and Development Costs Generally, research and development costs are expensed as incurred. Nonrefundable advance payments for goods or services that will be used or rendered for future research and development activities are deferred and amortized over the period that the goods are delivered or the related services are performed, subject to an assessment of recoverability. We make estimates of costs incurred in relation to external clinical research organizations, or “CROs,” and clinical site costs. We analyze the progress of clinical trials, including levels of patient enrollment, invoices received and contracted costs when evaluating the adequacy of the amount expensed and the related prepaid asset and accrued liability. Significant judgments and estimates must be made and used in determining the accrued balance and expense in any accounting period. We review and accrue CRO expenses and clinical trial study expenses based on work performed and rely upon estimates of those costs applicable to the stage of completion of a study. Accrued CRO costs are subject to revisions as such trials progress to completion. Revisions are charged to expense in the period in which the facts that give rise to the revision become known. With respect to clinical site costs, the financial terms of these agreements are subject to negotiation and vary from contract to contract. Payments under these contracts may be uneven, and depend on factors such as the achievement of certain events, the successful recruitment of patients, the completion of portions of the clinical trial or similar conditions. The objective of our policy is to match the recording of expenses in our financial statements to the actual services received and efforts expended. As such, expense accruals related to clinical site costs are recognized based on our estimate of the degree of completion of the event or events specified in the specific clinical study or trial contract. Prepaid research and development in our condensed consolidated balance sheets includes, among other things, certain costs to third party service providers related to development and manufacturing services as well as clinical development. These agreements often require payments in advance of services performed or goods received. Accordingly, as of June 30, 2020 and December 31, 2019, we recorded approximately $3.8 million and $8.1 million, respectively, in prepaid research and development related to such advance agreements. Income Taxes Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, operating losses and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in operations in the period that includes the enactment date. If the likelihood of realizing the deferred tax assets or liability is less than “more likely than not,” a valuation allowance is then created. We, and our subsidiaries, file income tax returns in the U.S. Federal jurisdiction and in various states, as well as in Australia. We have tax net operating loss carryforwards that are subject to examination for a number of years beyond the year in which they were generated for tax purposes. Since a portion of these net operating loss carryforwards may be utilized in the future, many of these net operating loss carryforwards will remain subject to examination. We recognize interest and penalties related to uncertain income tax positions in income tax expense. Coronavirus Aid, Relief and Economic Security Act (“CARES Act”) In response to the COVID-19 pandemic, the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”) was signed into law on March 27, 2020. The CARES Act, among other things, includes tax provisions relating to refundable payroll tax credits, deferment of employer’s social security payments, net operating loss utilization and carryback periods, modifications to the net interest deduction limitations and technical corrections to tax depreciation methods for qualified improvement property. At this time, the Company does not believe that the CARES Act will have a material impact on the Company’s income tax provision for 2020. The Company will continue to evaluate the impact of the CARES Act on its financial position, results of operations and cash flows. Stock-Based Compensation We recognize all stock-based payments to employees and non-employee directors (as compensation for service) as noncash compensation expense in the condensed consolidated financial statements based on the fair values of such payments. Stock-based compensation expense recognized each period is based on the value of the portion of stock-based payment awards that is ultimately expected to vest during the period. Forfeitures are recognized as they occur. In addition, because some of the options, restricted stock and warrants issued to employees, consultants and other third parties vest upon achievement of certain milestones, the total expense is uncertain. Compensation expense for such awards that vest upon the achievement of milestones is recognized when the achievement of such milestones becomes probable. Basic and Diluted Net Loss Per Common Share Basic net loss per share of our common stock is calculated by dividing net loss applicable to the common stock by the weighted-average number of our common stock outstanding for the period. Diluted net loss per share of common stock is the same as basic net loss per share of common stock since potentially dilutive securities from stock options, stock warrants and convertible preferred stock would have an antidilutive effect either because we incurred a net loss during the period presented or because such potentially dilutive securities were out of the money and the Company realized net income during the period presented. The cumulative amounts of potentially dilutive securities excluded from the calculation were 10,535,748 securities and 7,844,712 securities for the three and six month periods ended June 30, 2020 and 2019, respectively. The following outstanding shares of potentially dilutive securities were excluded from the computation of net loss per share attributable to common stockholders for the periods presented because including them would have been antidilutive: Three and Six Months Ended June 30, 2020 2019 Unvested restricted stock 7,732,615 5,137,196 Options 2,638,480 2,543,710 Warrants 147,058 147,058 Shares issuable upon note conversion 17,595 16,748 Total 10,535,748 7,844,712 Long-Lived Assets and Goodwill Long-lived assets are reviewed for potential impairment when circumstances indicate that the carrying value of long-lived tangible and intangible assets with finite lives may not be recoverable. Management’s policy in determining whether an impairment indicator exists, a triggering event, comprises measurable operating performance criteria as well as qualitative measures. If an analysis is necessitated by the occurrence of a triggering event, we make certain assumptions in determining the impairment amount. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized. Goodwill is reviewed for impairment annually, or earlier when events arise that could indicate that an impairment exists. We test for goodwill impairment using a two-step process. The first step compares the fair value of the reporting unit with the unit’s carrying value, including goodwill. When the carrying value of the reporting unit is greater than fair value, the unit’s goodwill may be impaired, and the second step must be completed to measure the amount of the goodwill impairment charge, if any. In the second step, the implied fair value of the reporting unit’s goodwill is compared with the carrying amount of the unit’s goodwill. If the carrying amount is greater than the implied fair value, the carrying value of the goodwill must be written down to its implied fair value. We will continue to perform impairment tests annually, at December 31, and whenever events or changes in circumstances suggest that the carrying value of an asset may not be recoverable. |
CASH AND CASH EQUIVALENTS
CASH AND CASH EQUIVALENTS | 6 Months Ended |
Jun. 30, 2020 | |
CASH. AND CASH EQUIVALENTS | |
CASH AND CASH EQUIVALENTS | NOTE 2 CASH AND CASH EQUIVALENTS The following tables summarize our cash and cash equivalents at June 30, 2020 and December 31, 2019: June 30, December 31, (in thousands) 2020 2019 Checking and bank deposits $ 245,054 $ 110,135 Money market funds 15,458 2,502 Total $ 260,512 $ 112,637 |
INVESTMENT SECURITIES
INVESTMENT SECURITIES | 6 Months Ended |
Jun. 30, 2020 | |
INVESTMENT SECURITIES | |
INVESTMENT SECURITIES | NOTE 3 INVESTMENT SECURITIES Our investments as of June 30, 2020 and December 31, 2019 are classified as held-to-maturity. Held-to-maturity investments are recorded at amortized cost. The following tables summarize our investment securities at June 30, 2020 and December 31, 2019: June 30, 2020 Amortized Gross Gross cost, as unrealized unrealized Estimated (in thousands) adjusted holding gains holding losses fair value Short-term investments: Obligations of domestic governmental agencies (maturing between July 2020 and September 2020) (held-to-maturity) $ 15,058 $ 26 $ — $ 15,084 Total short-term investment securities $ 15,058 $ 26 $ — $ 15,084 December 31, 2019 Amortized Gross Gross cost, as unrealized unrealized Estimated fair adjusted holding gains holding losses value Short-term investments: Obligations of domestic governmental agencies (maturing between January 2020 and September 2020) (held-to-maturity) $ 27,798 $ 28 $ — $ 27,826 Total short-term investment securities $ 27,798 $ 28 $ — $ 27,826 |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 6 Months Ended |
Jun. 30, 2020 | |
FAIR VALUE MEASUREMENTS | |
FAIR VALUE MEASUREMENTS | NOTE 4 FAIR VALUE MEASUREMENTS We measure certain financial assets and liabilities at fair value on a recurring basis in the condensed consolidated financial statements. The fair value hierarchy ranks the quality and reliability of inputs, or assumptions, used in the determination of fair value and requires financial assets and liabilities carried at fair value to be classified and disclosed in one of the following three categories: ● Level 1 quoted prices in active markets for identical assets and liabilities; ● Level 2 inputs other than Level 1 quoted prices that are directly or indirectly observable; and ● Level 3 unobservable inputs that are not corroborated by market data. As of June 30, 2020 and December 31, 2019, the fair values of cash and cash equivalents, restricted cash, and notes and interest payable, approximate their carrying values. At the time of our merger (we were then known as Manhattan Pharmaceuticals, Inc.) with Ariston Pharmaceuticals, Inc. (“Ariston”) in March 2010, Ariston issued $15.5 million of five-year 5% notes payable (the “5% Notes”) in satisfaction of several note payable issuances. The 5% Notes and accrued and unpaid interest thereon are convertible at the option of the holder into common stock at the conversion price of $1,125 per share. Ariston agreed to make quarterly payments on the 5% Notes equal to 50% of the net product cash flow received from the exploitation or commercialization of Ariston’s product candidates, AST-726 and AST-915. We have no obligations under the 5% Notes aside from (a) 50% of the net product cash flows from Ariston’s product candidates, if any, payable to noteholders; and (b) the conversion feature, discussed above. The cumulative liability to the Ariston subsidiary including accrued and unpaid interest of the 5% Notes was approximately $19.8 million at June 30, 2020 and $19.3 million at December 31, 2019. No payments have been made on the 5% Notes since the merger and through June 30, 2020. In December 2011, we elected the fair value option for valuing the 5% Notes. The fair value option was elected in order to reflect in our financial statements the assumptions that market participants use in evaluating these financial instruments. As of December 31, 2013, as a result of expiring intellectual property rights and other factors, it was determined that net product cash flows from AST-726 were unlikely. As we have no other obligations under the 5% Notes aside from the net product cash flows and the conversion feature, the conversion feature was used to estimate the 5% Notes’ fair value as of June 30, 2020 and December 31, 2019. The assumptions, assessments and projections of future revenues are subject to uncertainties, difficult to predict, and require significant judgment. The use of different assumptions, applying different judgment to inherently subjective matters and changes in future market conditions could result in significantly different estimates of fair value and the differences could be material to our condensed consolidated financial statements. The following tables provide the fair value measurements of applicable financial liabilities as of June 30, 2020 and December 31, 2019: Financial liabilities at fair value as of June 30, 2020 (in thousands) Level 1 Level 2 Level 3 Total 5% Notes $ — $ — $ 343 $ 343 Total $ — $ — $ 343 $ 343 Financial liabilities at fair value as of December 31, 2019 Level 1 Level 2 Level 3 Total 5% Notes $ — $ — $ 190 $ 190 Total $ — $ — $ 190 $ 190 The Level 3 amounts above represent the fair value of the 5% Notes and related accrued interest. The Company’s financial instruments include cash, cash equivalents consisting of money market funds, accounts payable and debt. Cash, cash equivalents, accounts payable and debt are stated at their respective historical carrying amounts, which approximate fair value due to their short-term nature. The following table summarizes the changes in Level 3 instruments during the three months ended June 30, 2020: (in thousands) Balance at December 31, 2019 $ 190 Interest accrued on face value of 5% Notes 484 Change in fair value of Level 3 liabilities (331) Balance at June 30, 2020 $ 343 The change in the fair value of the Level 3 liabilities is reported in other (income) expense in the accompanying condensed consolidated statements of operations. |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 6 Months Ended |
Jun. 30, 2020 | |
STOCKHOLDERS' EQUITY | |
STOCKHOLDERS' EQUITY | NOTE 5 STOCKHOLDERS’ EQUITY Preferred Stock Our amended and restated certificate of incorporation authorizes the issuance of up to 10,000,000 shares of preferred stock, $0.001 par value, with rights senior to those of our common stock, issuable in one or more series. Upon issuance, we can determine the rights, preferences, privileges and restrictions thereof. These rights, preferences and privileges could include dividend rights, conversion rights, voting rights, terms of redemption, liquidation preferences, sinking fund terms and the number of shares constituting any series or the designation of such series, any or all of which may be greater than the rights of common stock. Common Stock Our amended and restated certificate of incorporation authorizes the issuance of up to 150,000,000 shares of $0.001 par value common stock. On September 5, 2019, we filed an automatic “shelf registration” statement on Form S-3 (the “2019 WKSI Shelf”) as a “well-known seasoned issuer” as defined in Rule 405 under the Securities Act, which registered an unlimited and indeterminate amount of debt or equity securities for future issuance and sale. The 2019 WKSI Shelf was declared effective in September 2019. In connection with the 2019 WKSI Shelf, we entered into an At-the-Market Issuance Sales Agreement (the “2020 ATM”) with Jefferies LLC, Cantor Fitzgerald & Co. and B. Riley FBR, Inc. (each a “2020 Agent” and collectively, the “2020 Agents”), relating to the sale of shares of our common stock. Under the 2020 ATM, we pay the 2020 Agents a commission rate of up to 3.0% of the gross proceeds from the sale of any shares of common stock. During the six months ended June 30, 2020, we sold an aggregate of 4,535,608 shares of common stock pursuant to the 2020 ATM for total gross proceeds of approximately $77.4 million at an average selling price of $17.07 per share, resulting in net proceeds of approximately $76.0 million after deducting commissions and other transactions costs. In May 2020, we completed an underwritten public offering of 8,500,000 shares of our common stock (plus an underwriter option to purchase up to an additional 1,275,000 shares of common stock, which was exercised) at a price of $18 per share. Net proceeds from this offering, including the overallotment, were approximately $165.1 million, net of underwriting discounts and offering expenses of approximately $10.6 million plus professional fees of $0.3 million, for total offering costs of $10.9 million. The 2019 WKSI Shelf is currently our only active shelf-registration statement. We may offer any combination of the securities registered under the 2019 WKSI Shelf from time to time in response to market conditions or other circumstances if we believe such a plan of financing is in the best interests of our stockholders. We believe that the 2019 WKSI provides us with the flexibility to raise additional capital to finance our operations as needed. Equity Incentive Plans The TG Therapeutics, Inc. Amended and Restated 2012 Incentive Plan (the “2012 Incentive Plan”) was approved by stockholders in June 2020. Pursuant to this amendment, 8,000,000 shares were added to the 2012 Incentive Plan. As of June 30, 2020, 9,232,615 shares of restricted stock and 2,638,480 options were outstanding and up to an additional 5,804,913 shares may be issued under the 2012 Incentive Plan. Stock Options The following table summarizes stock option activity for the six months ended June 30, 2020: Weighted- average Weighted- Contractual Number of average Term Aggregate shares exercise price (in years) intrinsic value Outstanding at December 31, 2019 2,605,730 $ 6.73 8.92 $ 11,706,110 Granted 75,000 8.21 Exercised (23,500) 4.10 Forfeited (18,750) 4.10 Expired — — Outstanding at June 30, 2020 2,638,480 $ 7.14 8.54 $ 33,882,315 Total expense associated with the stock options was approximately $0.4 million and $0.8 million during the three months ended June 30, 2020 and 2019, respectively, and $4.3 million and $1.5 million during the six months ended June 30, 2020 and 2019, respectively. As of June 30, 2020, there was approximately $3.1 million of total unrecognized compensation cost related to unvested time-based stock options, which is expected to be recognized over a weighted-average period of 1.5 years. As of June 30, 2020, the stock options outstanding include options granted to both employees and non-employees which are both time-based and milestone-based. Stock-based compensation for milestone-based options will be recorded if and when a milestone occurs. The fair value of the Company’s option awards granted during the six months ended June 30, 2020 and 2019 were estimated on the grant date using the Black-Scholes option-pricing model using the assumptions below. Six months ended June 30, 2020 June 30, 2019 Volatility 186.91-191.05 172.99-291.61 Expected term (in years) 5.0-6.25 5.0 Risk-free rate 0.34-0.54 % 1.96-2.49 % Expected dividend yield — % — % Restricted Stock Certain employees, directors and consultants have been awarded restricted stock. The restricted stock vesting consists of milestone and time-based vesting. The following table summarizes restricted share activity for the six months ended June 30, 2020: Weighted Average Grant Date Fair Number of Shares Value Outstanding at December 31, 2019 7,091,789 $ 7.78 Granted 2,982,829 17.33 Vested (790,337) 8.10 Forfeited (51,666) 11.24 Outstanding at June 30, 2020 9,232,615 $ 10.82 Total expense associated with restricted stock grants was approximately $7.0 million and $1.0 million during the three months ended June 30, 2020 and 2019, respectively, and $14.1 million and $2.1 million during the six months ended June 30, 2020 and 2019, respectively. As of June 30, 2020, there was approximately $31.0 million of total unrecognized compensation cost related to unvested time-based restricted stock, which is expected to be recognized over a weighted-average period of 1.1 years. This amount does not include, as of June 30, 2020, 4,559,040 shares of restricted stock outstanding which are milestone-based and vest upon certain corporate milestones. Until the measurement date is reached for milestone awards, the total amount of compensation expense remains uncertain. We record compensation expense based on the fair value of the award at the grant date. The following table summarizes stock-based compensation expense information about restricted stock and stock options for the three and six months ended June 30, 2020: Three months and Six months ended June 30, June 30, (in thousands) 2020 2020 Stock-based compensation expense associated with restricted stock $ 6,975 $ 14,095 Stock-based compensation expense associated with option grants 395 4,343 Total $ 7,370 $ 18,438 Warrants The following table summarizes warrant activity for the six months ended June 30, 2020: Weighted- average exercise Aggregate Warrants price intrinsic value Outstanding at December 31, 2019 147,058 $ 4.08 $ 1,032,347 Issued — — — Exercised — — — Expired — — — Outstanding at June 30, 2020 147,058 $ 4.08 $ 2,264,693 There was no stock compensation expense related to warrants during the six months ended June 30, 2020 and 2019. |
OTHER LIABILITIES
OTHER LIABILITIES | 6 Months Ended |
Jun. 30, 2020 | |
OTHER LIABILITIES | |
OTHER LIABILITIES | NOTE 6 OTHER LIABILITIES The following is a summary of notes payable included in other current liabilities on the Company’s condensed consolidated balance sheets: (in thousands) June 30, 2020 December 31, 2019 Non- Non- Current current Current current portion, portion, portion, portion, net net Total net net Total Convertible 5% Notes Payable $ 343 $ — $ 343 $ 190 $ — $ 190 Totals $ 343 $ — $ 343 $ 190 $ — $ 190 Convertible 5% Notes Payable The 5% Notes and accrued and unpaid interest thereon are convertible at the option of the holder into common stock at the conversion price of $1,125 per share. We have no obligation under the 5% Notes aside from (a) 50% of the net product cash flows from Ariston’s product candidates, if any, payable to noteholders; and (b) the conversion feature, discussed above. Interest accrues monthly, is added to principal on an annual basis, every March 8, and is payable at maturity, which was March 8, 2015 (see Note 4 for further details). The cumulative liability including accrued and unpaid interest of these notes was approximately $19.8 million at June 30, 2020 and $19.3 million at December 31, 2019. No payments have been made on the 5% Notes as of June 30, 2020. In December 2011, we elected the fair value option for valuing the 5% Notes. The fair value option was elected in order to reflect in our financial statements the assumptions that market participants use in evaluating these financial instruments (see Note 4 for further details). Other Current Liabilities In 2018, we entered into an agreement with a contract manufacturer for the clinical and potential commercial supply of one of our product candidates. As part of this agreement, the contract manufacturer agreed to defer payment of certain costs and expenses under the agreement in exchange for the payment of an administrative fee. We have incurred expenses related to this agreement of approximately $51.8 million as of June 30, 2020, which include service fees, raw material costs and administrative fees. Payments of $27.0 million have been made to the contract manufacturer as of June 30, 2020. Accordingly, as of June 30, 2020, $24.8 million is included in other current liabilities in the Company’s unaudited condensed consolidated balance sheet. As of June 30, 2020, there are no long-term liabilities in the Company’s unaudited condensed consolidated balance sheet related to this agreement. We will incur an administrative fee of six percent (6%) per year starting from the date of invoice issuance. For the six months ended June 30, 2020, we have accrued $2.2 million in administrative fees in connection with these costs, which has been included in interest expense in the Company’s unaudited condensed consolidated statements of operations. |
LONG-TERM DEBT
LONG-TERM DEBT | 6 Months Ended |
Jun. 30, 2020 | |
LONG-TERM DEBT. | |
LONG-TERM DEBT | NOTE 7 LONG-TERM DEBT On February 28, 2019 (the “Closing Date”), we entered into a term loan facility of up to $60.0 million (“Term Loan”) with Hercules Capital, Inc. (“Hercules”), the proceeds of which were used for research and development programs and for general corporate purposes. The Term Loan is governed by a loan and security agreement, dated February 28, 2019 (the “Loan Agreement”), which provides for up to four separate advances. The first advance of $30.0 million was drawn on the Closing Date. Two additional advances of $10.0 million may be drawn at our option, but are subject to the clinical trial milestones identified in the Term Loan, and the fourth advance of $10.0 million, available in minimum increments of $5.0 million, is available through December 15, 2020 subject to the approval of Hercules’ investment committee. The Term Loan will mature on March 1, 2022 (the “Loan Maturity Date”). Each advance accrues interest at a per annum rate of interest equal to the greater of either (i) the “prime rate” as reported in The Wall Street Journal plus 4.75%, and (ii) 10.25%. The Term Loan provides for interest-only payments until October 1, 2020. The interest-only period may be extended to April 1, 2021 if, on or before September 30, 2020, we achieve either the third milestone or we have raised at least $150.0 million in unrestricted net cash proceeds from one or more equity financings, subordinated indebtedness and/or upfront proceeds from business development transactions permitted under the Loan Agreement, in each case after February 7, 2019, and prior to September 30, 2020 (“Milestone IV”). Thereafter, amortization payments will be payable monthly in eighteen installments (or, if the period requiring interest-only payments has been extended to April 1, 2021, in twelve installments) of principal and interest (subject to recalculation upon a change in prime rates). As a result of the Company having raised in excess of $150 million before the required timeline in the Loan Agreement, the interest-only period has been extended to April 1, 2021. At our option upon seven business days’ prior written notice to Hercules, we may prepay all or any portion greater than or equal to $5.0 million of the outstanding advances by paying the entire principal balance (or portion thereof), all accrued and unpaid interest, subject to a prepayment charge of 3.0%, if such advance is prepaid in any of the first twelve months following the Closing Date; 1.5%, if such advance is prepaid after twelve months following the Closing Date but on or prior to twenty-four months following the Closing Date; and 0% thereafter. In addition, a final payment equal to 3.5% of the aggregate principal amount of the loan extended by Hercules is due on the maturity date. Amounts outstanding during an event of default shall be payable on demand and accrue interest at an additional rate of 4.0% per annum of the past due amount outstanding. The Term Loan is secured by a lien on substantially all of our assets, other than intellectual property, and contains customary covenants and representations, including a liquidity covenant, financial reporting covenant and limitations on dividends, indebtedness, collateral, investments, distributions, transfers, mergers or acquisitions, taxes, corporate changes, deposit accounts, and subsidiaries. As of June 30, 2020 and through the filing date of this report, the Company has been in compliance with all covenants. The events of default under the Loan Agreement include, without limitation, and subject to customary grace periods, (1) our failure to make any payments of principal or interest under the Loan Agreement, promissory notes or other loan documents, (2) our breach or default in the performance of any covenant under the Loan Agreement, (3) the occurrence of a material adverse effect, (4) a false or misleading representation or warranty in any material respect, (5) our insolvency or bankruptcy, (6) certain attachments or judgments on our assets, or (7) the occurrence of any material default under certain agreements or obligations involving indebtedness in excess of $750,000. If an event of default occurs, Hercules is entitled to take enforcement action, including acceleration of amounts due under the Loan Agreement. The Loan Agreement also contains warrant coverage of 2% of the total amount funded. A warrant (the “Hercules Warrant”) was issued to Hercules to purchase 147,058 shares of common stock with an exercise price of $4.08. The Hercules Warrant is exercisable for seven years from the date of issuance. Hercules may exercise the Hercules Warrant either by (a) cash or check or (b) through a net issuance conversion. The shares will be registered and freely tradeable within six months of issuance. We accounted for the Hercules Warrant as an equity instrument since it was indexed to our common shares and met the criteria for classification in shareholders’ (deficit) equity. The relative fair value of the Hercules Warrant on the date of issuance was approximately $1.0 million and was treated as debt issuance costs and as an offset to the Term Loan. This amount will be amortized to interest expense using the straight-line method, which approximates the effective interest method, over the life of the Term Loan. The Company estimated the fair value of the Warrant using the Black-Scholes model based on the following key assumptions: Exercise Price $ 4.08 Common share price on date of issuance $ 6.80 Volatility 195.9 % Risk-free interest rate 2.63 % Expected dividend yield -- % Contractual term (in years) 7.00 years The Company incurred financing expenses of $2.8 million (including the fair value of the Hercules Warrant) related to the Hercules Loan Agreement which are recorded as debt issuance costs and as an offset to long-term debt on the Company’s unaudited condensed consolidated balance sheet. The debt issuance costs are being amortized over the term of the debt using the straight-line method, which approximates the effective interest method, and are included in interest expense in the Company’s unaudited condensed consolidated statements of operations. Amortization of debt issuance costs was $0.2 million and $0.5 million for the three and six months ended June 30, 2020, respectively. At June 30, 2020, the remaining unamortized balance of debt issuance costs was $1.5 million. Long-term debt as of June 30, 2020 is as follows: June 30, (in thousands) 2020 Long-term debt $ 30,000 End of term fee 975 30,975 Less: unamortized debt issuance costs (1,542) 29,433 Less: current portion (7,200) Long-term debt non-current $ 22,233 |
LEASES
LEASES | 6 Months Ended |
Jun. 30, 2020 | |
LEASES | |
LEASES | NOTE 8 LEASES In October 2014, we entered into an agreement (the “Office Agreement”) with Fortress Biotech, Inc. (“FBIO”) to occupy approximately 45% of the 24,000 square feet of New York City office space leased by FBIO. The Office Agreement requires us to pay our respective share of the average annual rent and other costs of the 15-year lease. We approximate an average annual rental obligation of $1.4 million under the Office Agreement. We began to occupy this new space in April 2016, with rental payments beginning in the third quarter of 2016. At January 1, 2019, we recognized a lease liability and corresponding Right-of-Use (“ROU”) asset of $9.5 million and $8.1 million, respectively, based on the present value of the remaining lease payments for all of our leased office spaces, the majority of which is comprised of our New York City office space. The initial commitment period of the 45% rate was for a period of three (3) years. We and FBIO currently determine actual office space utilization annually and if our utilization differs from the amount we have been billed, we will either receive credits or be assessed incremental utilization charges. As of June 30, 2020, the allocation rate is 61% and will be evaluated again in August 2020 for the following rent year. Also in connection with this lease, in October 2014 we pledged $0.6 million to secure a line of credit as a security deposit for the Office Agreement, which has been recorded as restricted cash in the accompanying consolidated balance sheets. Additional collateral of $0.6 million was pledged in April 2018 to increase the letter of credit for the office space. In October 2019, we finalized a five-year The present values of our lease liability and corresponding ROU asset are $11.6 million and $9.1 million, respectively, as of June 30, 2020. Our leases have remaining lease terms of less than 1 year to 12 years. One lease has a renewal option to extend the lease for an additional term of 1 year. The following components of lease expense are included in the Company’s condensed consolidated statements of operations for the three and six months ended June 30, 2020: Three months Six months ended, ended, June 30, June 30, (in thousands) 2020 2020 Operating lease cost $ 570 $ 1,077 Net lease cost $ 570 $ 1,077 As of June 30, 2020, the weighted-average remaining operating lease term was 8.0 years and the weighted-average discount rate for operating leases was 10.25%. Cash paid for amounts included in the measurement of operating lease liabilities during the six months ended June 30, 2020 was $2.4 million. The balance sheet classification of lease liabilities was as follows: June 30, (in thousands) 2020 Liabilities Lease liability current portion $ 1,655 Lease liability non-current 9,938 Total lease liability $ 11,593 As of June 30, 2020, the maturities of lease liabilities were as follows: Operating (in thousands) leases Remainder of 2020 $ 948 2021 1,889 2022 1,911 2023 1,913 2024 1,796 After 2024 10,615 Total lease payments 19,072 Less: interest (7,479) Present value of lease liabilities(*) $ 11,593 (*) As our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date and considering the term of the lease to determine the present value of lease payments. We used the incremental borrowing rate of 10.25% on February 28, 2019, for operating leases that commenced prior to that date. |
LICENSE AGREEMENTS
LICENSE AGREEMENTS | 6 Months Ended |
Jun. 30, 2020 | |
LICENSE AGREEMENTS | |
LICENSE AGREEMENTS | NOTE 9 LICENSE AGREEMENTS TG-1101 (Ublituximab) In November 2012, we entered into an exclusive (within the territory) sublicense agreement with Ildong Pharmaceutical Co. Ltd. (“Ildong”) relating to the development and commercialization of ublituximab in South Korea and Southeast Asia. Under the terms of the sublicense agreement, Ildong has been granted a royalty bearing, exclusive right, including the right to grant sublicenses, to develop and commercialize ublituximab in South Korea, Taiwan, Singapore, Indonesia, Malaysia, Thailand, Philippines, Vietnam, and Myanmar. An upfront payment of $2.0 million, which was received in December 2012, net of $0.3 million of income tax withholdings, is being recognized as license revenue on a straight-line basis over the life of the agreement, which is through the expiration of the last licensed patent right or 15 years after the first commercial sale of a product in such country, unless the agreement is earlier terminated, and represents the estimated period over which we will have certain ongoing responsibilities under the sublicense agreement. We recorded license revenue of approximately $38,000 for each of the three months ended June 30, 2020 and 2019, and approximately $76,000 for each of the six months ended June 30, 2020 and 2019, and, at June 30, 2020 and December 31, 2019, have deferred revenue of approximately $0.8 million and $0.9 million, respectively, associated with this $2 million payment (approximately $152,000 of which has been classified in current liabilities at June 30, 2020 and December 31, 2019). We may receive up to an additional $5.0 million in payments upon the achievement of pre-specified milestones. In addition, upon commercialization, Ildong will make royalty payments to us on net sales of ublituximab in the sublicense territory. TG-1501: PDL1 (Cosibelimab) In March 2015, we entered into a Global Collaboration Agreement (“Collaboration Agreement”) with Checkpoint Therapeutics, Inc. (“Checkpoint”) for the development and commercialization of anti-PD-L1 and anti-GITR antibody research programs in the field of hematological malignancies. The Collaboration Agreement was amended in June 2019 and in March of 2020 achieved the first Milestone event for which we incurred expenses of zero and approximately $0.9 million for the three and six months ended June 30, 2020. TG-1601: BET In May 2016, as part of a broader agreement with Jubilant Biosys (“Jubilant”), we entered into a sub-license agreement (“JBET Agreement”) with Checkpoint (see Note 10), for the development and commercialization of Jubilant’s novel BET inhibitor program in the field of hematological malignancies. Under the terms of the agreement, we paid Checkpoint an up-front licensing fee of $1.0 million and will make additional payments contingent on certain preclinical, clinical, and regulatory milestones, including commercial milestones totaling up to approximately $177 million and a single-digit royalty on net sales. TG will also provide funding to support certain targeted research efforts at Jubilant. TG-1701: BTK In January 2018, we entered into a global exclusive license agreement with Jiangsu Hengrui Medicine Co. (“Hengrui”), to acquire worldwide intellectual property rights, excluding Asia but including Japan, and for the research, development, manufacturing, and commercialization of products containing or comprising of any of Hengrui’s Brutons Tyrosine Kinase inhibitors containing the compounds of either TG-1701 (SHR1459 or EBI1459) or TG1702 (SHR1266 or EBI1266). Pursuant to the agreement, in April 2018, we paid Hengrui an upfront fee of $1.0 million in our common stock recorded to noncash stock expense associated with in-licensing agreements in our condensed consolidated statement of operations. In addition, in July 2019, we paid Hengrui the first milestone of $0.1 million in our common stock recorded to noncash stock expense associated with in-licensing agreements in our consolidated statement of operations. Hengrui is eligible to receive milestone payments totaling approximately $350 million upon and subject to the achievement of certain milestones. Various provisions allow for payments in conjunction with the agreement to be made in cash or our common stock, while others limit the form of payment. Royalty payments in the low double digits are due on net sales of licensed products and revenue from sublicenses. We incurred expenses of approximately $0.9 million and $0.5 million for the three months ended June 30, 2020 and 2019, respectively, and, $1.8 million and $0.5 million for the six months ended June 30, 2020 and 2019, respectively, the majority of which relates to manufacturing expenses of BTK. The relevant expenses are recorded in other research and development in the accompanying unaudited condensed consolidated statement of operations. TG-1801: anti-CD47/anti-CD19 In June 2018, we entered into a Joint Venture and License Option Agreement with Novimmune SA (“Novimmune”) to collaborate on the development and commercialization of Novimmune’s novel first-in-class anti-CD47/anti-CD19 bispecific antibody known as TG-1801 (previously NI-1701). The companies will jointly develop the product on a worldwide basis, focusing on indications in the area of hematologic B-cell malignancies. We serve as the primary responsible party for the development, manufacturing and commercialization of the product. Pursuant to the agreement, in June 2018 we paid Novimmune an upfront payment of $3.0 million in our common stock recorded to noncash stock expense associated with in-licensing agreements in our consolidated statement of operations. Further milestone payments will be paid based on early clinical development, and the Company will be responsible for the costs of clinical development of the product through the end of the Phase 2 clinical trials, after which the Company and Novimmune will be jointly responsible for all development and commercialization costs. The Company and Novimmune will each maintain an exclusive option, exercisable at specific times during development, for the Company to license the rights to TG-1801, in which case Novimmune is eligible to receive additional milestone payments totaling approximately $185 million as well as tiered royalties on net sales in the high single to low double digits upon and subject to the achievement of certain milestones. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 6 Months Ended |
Jun. 30, 2020 | |
RELATED PARTY TRANSACTIONS | |
RELATED PARTY TRANSACTIONS | NOTE 10 RELATED PARTY TRANSACTIONS In October 2014, we entered into the Office Agreement with FBIO, to occupy approximately 45% of the 24,000 square feet of New York City office space leased by FBIO. The Office Agreement requires us to pay our respective share of the average annual rent and other costs of the 15-year lease. We approximate an average annual rental obligation of $1.1 million under the Office Agreement. We began to occupy this new space in April 2016, with rental payments beginning in the third quarter of 2016. At January 1, 2019, we recognized a lease liability of $9.3 million, with a corresponding ROU asset of $7.7 million based on the present value of the remaining lease payments for all of our leased office spaces, the majority of which is comprised of our New York City office space. Mr. Weiss, our Executive Chairman and CEO, is also Executive Vice Chairman of FBIO. Under the Office Agreement, we agreed to pay FBIO our portion of the build out costs, which have been allocated to us at the 45% rate mentioned above. The allocated build-out costs have been recorded in Leasehold Interest, net on the Company's condensed consolidated balance sheets and will be amortized over the 15-year term of the Office Agreement. The initial commitment period of the 45% rate was for a period of three ( 3 In March 2015, we entered into a Global Collaboration Agreement (“Collaboration Agreement”) with Checkpoint for the development and commercialization of anti-PD-L1 and anti-GITR antibody research programs in the field of hematological malignancies. The Collaboration Agreement was amended in June 2019 and upon execution of the amendment we incurred an upfront fee of $1.0 million. We incurred expenses of approximately $1.0 million and $1.4 million for the six months ended June 30, 2020 and 2019, respectively, and expenses of approximately $0.04 million and $1.1 million for the three months ended June 30, 2020 and 2019. |
ORGANIZATION AND SUMMARY OF S_2
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jun. 30, 2020 | |
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Description of Business | Description of Business We are a biopharmaceutical company dedicated to developing and delivering medicines for patients with B-cell mediated diseases, including chronic lymphocytic leukemia (CLL), non-Hodgkin lymphoma (NHL) and multiple sclerosis (MS). We have developed a robust B-cell directed research and development (R&D) platform for identification of key B-cell pathways of interest and rapid clinical testing. Currently, we have five B-cell targeted drug candidates in clinical development, with the two lead therapies, ublituximab (TG-1101) and umbralisib (TGR-1202), in pivotal trials for CLL and NHL, with ublituximab also in pivotal trials for MS. Ublituximab is a novel anti-CD20 monoclonal antibody (mAb) that has been glycoengineered for enhanced potency. Umbralisib is an oral, once daily, dual inhibitor of PI3K-delta and CK1-epsilon. When used together in combination therapy, ublituximab and umbralisib are referred to as “U2”. Additionally, in early clinical development we have an anti-PD-L1 monoclonal antibody referred to as cosibelimab (TG-1501), an oral Bruton’s Tyrosine Kinase (BTK) inhibitor referred to as TG-1701, and an anti-CD47/CD19 bispecific antibody referred to as TG-1801. We also actively evaluate complementary products, technologies and companies for in-licensing, partnership, acquisition and/or investment opportunities. To date, we have not received approval for the sale of any of our drug candidates in any market and, therefore, have not generated any product sales from our drug candidates. The accompanying unaudited condensed consolidated financial statements were prepared in accordance with U.S. generally accepted accounting principles, or “GAAP”, for interim financial information and with the instructions to Quarterly Report on Form 10-Q and Article 10 of Regulation S-X of the Exchange Act. Accordingly, they may not include all of the information and footnotes required by GAAP for complete financial statements. All adjustments that are, in the opinion of management, of a normal recurring nature and are necessary for a fair presentation of the condensed consolidated financial statements have been included. Nevertheless, these condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements contained in our Annual Report on Form 10-K for the year ended December 31, 2019. The accompanying condensed December 31, 2019 balance sheet has been derived from these statements. The results of operations for the six months ended June 30, 2020 are not necessarily indicative of the results that may be expected for the entire fiscal year or any other interim period. In December 2018, the Company created an Australian corporation, TG Therapeutics AUS Pty Ltd. (“TG AUS”), as a wholly-owned subsidiary. This corporation’s functional currency, the Australian dollar, is also its reporting currency, and its financial statements are translated to U.S. dollars, the Company’s reporting currency, prior to consolidation. The activities of TG AUS result in immaterial currency translation adjustments and, thus, are included in Other Income/Expense on the Company’s condensed consolidated statement of operations. The accompanying condensed consolidated financial statements include the accounts of the Company and its subsidiaries, and all intercompany accounts and transactions have been eliminated in consolidation. |
Liquidity and Capital Resources | Liquidity and Capital Resources We have incurred operating losses since our inception, expect to continue to incur operating losses for the foreseeable future, and may never become profitable. As of June 30, 2020, we have an accumulated deficit of approximately $805.2 million. Our major sources of cash have been proceeds from the private placement and public offering of equity securities, as well as debt financings. We have not yet commercialized any of our drug candidates and cannot be sure if we will ever be able to do so. Even if we commercialize one or more of our drug candidates, we may not become profitable. Our ability to achieve profitability depends on many factors, including our ability to obtain regulatory approval for our drug candidates; successfully complete any post-approval regulatory obligations; and successfully commercialize our drug candidates alone or in partnership. We may continue to incur substantial operating losses even if we begin to generate revenues from our drug candidates. As of June 30, 2020, we had $275.6 million in cash and cash equivalents, and investment securities. The Company believes its cash, cash equivalents, and investment securities on hand as of June 30, 2020 will provide sufficient liquidity for more than a twelve-month period from the date of filing this Quarterly Report on Form 10-Q. The actual amount of cash that we will need to operate is subject to many factors, including, but not limited to, the timing, design and conduct of clinical trials for our drug candidates. We are dependent upon significant future financing to provide the cash necessary to execute our current operations, including the commercialization of any of our drug candidates. Our common stock is listed on the Nasdaq Capital Market and trades under the symbol TGTX. |
Recently Issued Accounting Standards | Recently Issued Accounting Standards In July 2018, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update (“ASU”) No. 2018-11, “Leases - Targeted Improvements” (“ASU 2018-11”) as an update to ASU 2016-02, Leases (“ASU 2016-02” or “Topic 842”) issued on February 25, 2016. ASU 2016-02 is effective for public business entities for fiscal years beginning January 1, 2019. ASU 2016-02 required companies to adopt the new leases standard at the beginning of the earliest period presented in the financial statements, which is January 1, 2017, using a modified retrospective transition method where lessees must recognize lease assets and liabilities for all leases even though those leases may have expired before the effective date of January 1, 2017. Lessees must also provide the new and enhanced disclosures for each period presented, including the comparative periods. ASU 2018-11 provides an entity with an additional (and optional) transition method to adopt the new leases standard. Under this new transition method, an entity initially applies the new lease standard at the adoption date and recognizes a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. Consequently, an entity’s reporting for the comparative periods presented in the financial statements in which it adopts the new lease standard will continue to be in accordance with Accounting Standard Codification (“ASC”) 840, Leases (“ASC 840”). An entity that elects this additional (and optional) transition method must provide the required ASC 840 disclosures for all periods that continue to be in accordance with ASC 840. The amendments do not change the existing disclosure requirements in ASC 840. ASU 2018-11 was effective for public business entities for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years, with earlier adoption permitted. The Company adopted ASU 2018-11 on January 1, 2019 using a modified retrospective method and has not restated comparative periods. We elected the package of practical expedients permitted under the transition guidance, which allows us to carryforward our historical lease classification and our assessment on whether a contract is or contains a lease. The adoption of this guidance resulted in the addition of material balances of right of use assets and lease liabilities to our consolidated balance sheets at January 1, 2019, primarily relating to our lease of office space (see Note 8). The impact to our consolidated statements of operations was not material as a result of this standard. In June 2018, the FASB issued ASU No. 2018-07, “Improvements to Nonemployee Share-Based Payment Accounting” (“ASU 2018-07”). ASU 2018-07 expands the scope of FASB Topic 718, “Compensation – Stock Compensation” (“Topic 718”) to include share-based payment transactions for acquiring goods and services from nonemployees. An entity should only remeasure equity-classified awards for which a measurement date has not been established through a cumulative-effect adjustment to retained earnings as of the beginning of the fiscal year of adoption. Upon transition, the entity is required to measure these nonemployee awards at fair value as of the adoption date. The entity must not remeasure assets that are completed. Disclosures required at transition include the nature of and reason for the change in accounting principle and, if applicable, quantitative information about the cumulative effect of the change on retained earnings or other components of equity. ASU 2018-07 was effective for public business entities for fiscal years beginning after December 15, 2018, including interim periods within that fiscal year. Early adoption was permitted, but no earlier than an entity’s adoption date of ASC Topic 606, “Revenue from Contracts with Customers” (“ASC 606”). The Company adopted ASU 2018-07 on January 1, 2019. The adoption of ASU 2018-07 did not have a material effect on our consolidated financial statements as of January 1, 2019. The adoption of ASU 2018-07 had no impact on nonemployee performance awards as they are measured based on the outcome that is probable. Other pronouncements issued by the FASB or other authoritative accounting standards with future effective dates are either not applicable or not significant to our condensed consolidated financial statements. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and judgments that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the applicable reporting period. On an ongoing basis, we evaluate our estimates and judgments, including those related to accrued expenses and stock-based compensation. Actual results could differ from those estimates. Such differences could be material to the financial statements. |
Cash and Cash Equivalents | Cash and Cash Equivalents We treat liquid investments with original maturities of less than three months when purchased as cash and cash equivalents. |
Restricted Cash | Restricted Cash We record cash pledged or held in trust as restricted cash. As of June 30, 2020 and December 31, 2019, we have approximately $1.3 million of restricted cash pledged to secure a line of credit as a security deposit for an Office Agreement (see Note 8). |
Investment Securities | Investment Securities Investment securities at June 30, 2020 and December 31, 2019 consist of short-term government securities. We classify these securities as held-to-maturity. Held-to-maturity securities are those securities in which we have the ability and intent to hold the security until maturity. Held-to-maturity securities are recorded at amortized cost, adjusted for the amortization or accretion of premiums or discounts. Premiums and discounts are amortized or accreted over the life of the related held-to-maturity security as an adjustment to yield using the effective interest method. A decline in the market value of any investment security below cost, that is deemed to be other than temporary, results in a reduction in the carrying amount to fair value. The impairment is charged to operations and a new cost basis for the security is established. Other-than-temporary impairment charges are included in interest and other income (expense), net. Unrealized gains, if determined to be temporary, are included in accumulated other comprehensive income in equity. Dividend and interest income are recognized when earned. |
Credit Risk | Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents and short-term investments. The Company maintains its cash and cash equivalents and short-term investments with high-credit quality financial institutions. At times, such amounts may exceed federally-insured limits. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue under ASC 606. The core principle of this revenue standard is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. The following five steps are applied to achieve that core principle: ● Step 1: Identify the contract with the customer ● Step 2: Identify the performance obligations in the contract ● Step 3: Determine the transaction price ● Step 4: Allocate the transaction price to the performance obligations in the contract ● Step 5: Recognize revenue when the company satisfies a performance obligation In order to identify the performance obligations in a contract with a customer, a company must assess the promised goods or services in the contract and identify each promised good or service that is distinct. A performance obligation meets ASC 606’s definition of a “distinct” good or service (or bundle of goods or services) if both of the following criteria are met: ● The customer can benefit from the good or service either on its own or together with other resources that are readily available to the customer (i.e., the good or service is capable of being distinct); and ● The entity’s promise to transfer the good or service to the customer is separately identifiable from other promises in the contract (i.e., the promise to transfer the good or service is distinct within the context of the contract). If a good or service is not distinct, the good or service is combined with other promised goods or services until a bundle of goods or services is identified that is distinct. The transaction price is the amount of consideration to which an entity expects to be entitled in exchange for transferring promised goods or services to a customer, excluding amounts collected on behalf of third parties (for example, some sales taxes). The consideration promised in a contract with a customer may include fixed amounts, variable amounts, or both. Variable consideration is included in the transaction price only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. The transaction price is allocated to each performance obligation on a relative standalone selling price basis. The transaction price allocated to each performance obligation is recognized when that performance obligation is satisfied, at a point in time or over time as appropriate. |
Research and Development Costs | Research and Development Costs Generally, research and development costs are expensed as incurred. Nonrefundable advance payments for goods or services that will be used or rendered for future research and development activities are deferred and amortized over the period that the goods are delivered or the related services are performed, subject to an assessment of recoverability. We make estimates of costs incurred in relation to external clinical research organizations, or “CROs,” and clinical site costs. We analyze the progress of clinical trials, including levels of patient enrollment, invoices received and contracted costs when evaluating the adequacy of the amount expensed and the related prepaid asset and accrued liability. Significant judgments and estimates must be made and used in determining the accrued balance and expense in any accounting period. We review and accrue CRO expenses and clinical trial study expenses based on work performed and rely upon estimates of those costs applicable to the stage of completion of a study. Accrued CRO costs are subject to revisions as such trials progress to completion. Revisions are charged to expense in the period in which the facts that give rise to the revision become known. With respect to clinical site costs, the financial terms of these agreements are subject to negotiation and vary from contract to contract. Payments under these contracts may be uneven, and depend on factors such as the achievement of certain events, the successful recruitment of patients, the completion of portions of the clinical trial or similar conditions. The objective of our policy is to match the recording of expenses in our financial statements to the actual services received and efforts expended. As such, expense accruals related to clinical site costs are recognized based on our estimate of the degree of completion of the event or events specified in the specific clinical study or trial contract. Prepaid research and development in our condensed consolidated balance sheets includes, among other things, certain costs to third party service providers related to development and manufacturing services as well as clinical development. These agreements often require payments in advance of services performed or goods received. Accordingly, as of June 30, 2020 and December 31, 2019, we recorded approximately $3.8 million and $8.1 million, respectively, in prepaid research and development related to such advance agreements. |
Income Taxes | Income Taxes Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, operating losses and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in operations in the period that includes the enactment date. If the likelihood of realizing the deferred tax assets or liability is less than “more likely than not,” a valuation allowance is then created. We, and our subsidiaries, file income tax returns in the U.S. Federal jurisdiction and in various states, as well as in Australia. We have tax net operating loss carryforwards that are subject to examination for a number of years beyond the year in which they were generated for tax purposes. Since a portion of these net operating loss carryforwards may be utilized in the future, many of these net operating loss carryforwards will remain subject to examination. We recognize interest and penalties related to uncertain income tax positions in income tax expense. |
Coronavirus Aid, Relief and Economic Security Act ("CARES Act") | Coronavirus Aid, Relief and Economic Security Act (“CARES Act”) In response to the COVID-19 pandemic, the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”) was signed into law on March 27, 2020. The CARES Act, among other things, includes tax provisions relating to refundable payroll tax credits, deferment of employer’s social security payments, net operating loss utilization and carryback periods, modifications to the net interest deduction limitations and technical corrections to tax depreciation methods for qualified improvement property. At this time, the Company does not believe that the CARES Act will have a material impact on the Company’s income tax provision for 2020. The Company will continue to evaluate the impact of the CARES Act on its financial position, results of operations and cash flows. |
Stock-Based Compensation | Stock-Based Compensation We recognize all stock-based payments to employees and non-employee directors (as compensation for service) as noncash compensation expense in the condensed consolidated financial statements based on the fair values of such payments. Stock-based compensation expense recognized each period is based on the value of the portion of stock-based payment awards that is ultimately expected to vest during the period. Forfeitures are recognized as they occur. In addition, because some of the options, restricted stock and warrants issued to employees, consultants and other third parties vest upon achievement of certain milestones, the total expense is uncertain. Compensation expense for such awards that vest upon the achievement of milestones is recognized when the achievement of such milestones becomes probable. |
Basic and Diluted Net Loss Per Common Share | Basic and Diluted Net Loss Per Common Share Basic net loss per share of our common stock is calculated by dividing net loss applicable to the common stock by the weighted-average number of our common stock outstanding for the period. Diluted net loss per share of common stock is the same as basic net loss per share of common stock since potentially dilutive securities from stock options, stock warrants and convertible preferred stock would have an antidilutive effect either because we incurred a net loss during the period presented or because such potentially dilutive securities were out of the money and the Company realized net income during the period presented. The cumulative amounts of potentially dilutive securities excluded from the calculation were 10,535,748 securities and 7,844,712 securities for the three and six month periods ended June 30, 2020 and 2019, respectively. The following outstanding shares of potentially dilutive securities were excluded from the computation of net loss per share attributable to common stockholders for the periods presented because including them would have been antidilutive: Three and Six Months Ended June 30, 2020 2019 Unvested restricted stock 7,732,615 5,137,196 Options 2,638,480 2,543,710 Warrants 147,058 147,058 Shares issuable upon note conversion 17,595 16,748 Total 10,535,748 7,844,712 |
Long-Lived Assets and Goodwill | Long-Lived Assets and Goodwill Long-lived assets are reviewed for potential impairment when circumstances indicate that the carrying value of long-lived tangible and intangible assets with finite lives may not be recoverable. Management’s policy in determining whether an impairment indicator exists, a triggering event, comprises measurable operating performance criteria as well as qualitative measures. If an analysis is necessitated by the occurrence of a triggering event, we make certain assumptions in determining the impairment amount. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized. Goodwill is reviewed for impairment annually, or earlier when events arise that could indicate that an impairment exists. We test for goodwill impairment using a two-step process. The first step compares the fair value of the reporting unit with the unit’s carrying value, including goodwill. When the carrying value of the reporting unit is greater than fair value, the unit’s goodwill may be impaired, and the second step must be completed to measure the amount of the goodwill impairment charge, if any. In the second step, the implied fair value of the reporting unit’s goodwill is compared with the carrying amount of the unit’s goodwill. If the carrying amount is greater than the implied fair value, the carrying value of the goodwill must be written down to its implied fair value. We will continue to perform impairment tests annually, at December 31, and whenever events or changes in circumstances suggest that the carrying value of an asset may not be recoverable. |
ORGANIZATION AND SUMMARY OF S_3
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | Three and Six Months Ended June 30, 2020 2019 Unvested restricted stock 7,732,615 5,137,196 Options 2,638,480 2,543,710 Warrants 147,058 147,058 Shares issuable upon note conversion 17,595 16,748 Total 10,535,748 7,844,712 |
CASH AND CASH EQUIVALENTS (Tabl
CASH AND CASH EQUIVALENTS (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
CASH. AND CASH EQUIVALENTS | |
Schedule of Cash and Cash Equivalents | June 30, December 31, (in thousands) 2020 2019 Checking and bank deposits $ 245,054 $ 110,135 Money market funds 15,458 2,502 Total $ 260,512 $ 112,637 |
INVESTMENT SECURITIES (Tables)
INVESTMENT SECURITIES (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
INVESTMENT SECURITIES | |
Schedule of held-to-maturity securities | June 30, 2020 Amortized Gross Gross cost, as unrealized unrealized Estimated (in thousands) adjusted holding gains holding losses fair value Short-term investments: Obligations of domestic governmental agencies (maturing between July 2020 and September 2020) (held-to-maturity) $ 15,058 $ 26 $ — $ 15,084 Total short-term investment securities $ 15,058 $ 26 $ — $ 15,084 December 31, 2019 Amortized Gross Gross cost, as unrealized unrealized Estimated fair adjusted holding gains holding losses value Short-term investments: Obligations of domestic governmental agencies (maturing between January 2020 and September 2020) (held-to-maturity) $ 27,798 $ 28 $ — $ 27,826 Total short-term investment securities $ 27,798 $ 28 $ — $ 27,826 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
FAIR VALUE MEASUREMENTS | |
Schedule of fair value, liabilities measured on recurring and nonrecurring basis | Financial liabilities at fair value as of June 30, 2020 (in thousands) Level 1 Level 2 Level 3 Total 5% Notes $ — $ — $ 343 $ 343 Total $ — $ — $ 343 $ 343 Financial liabilities at fair value as of December 31, 2019 Level 1 Level 2 Level 3 Total 5% Notes $ — $ — $ 190 $ 190 Total $ — $ — $ 190 $ 190 |
Schedule of change in level three fair value during period | (in thousands) Balance at December 31, 2019 $ 190 Interest accrued on face value of 5% Notes 484 Change in fair value of Level 3 liabilities (331) Balance at June 30, 2020 $ 343 |
STOCKHOLDERS' (DEFICIT) EQUITY
STOCKHOLDERS' (DEFICIT) EQUITY (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
STOCKHOLDERS' EQUITY | |
Schedule of Stock Options Activity | Weighted- average Weighted- Contractual Number of average Term Aggregate shares exercise price (in years) intrinsic value Outstanding at December 31, 2019 2,605,730 $ 6.73 8.92 $ 11,706,110 Granted 75,000 8.21 Exercised (23,500) 4.10 Forfeited (18,750) 4.10 Expired — — Outstanding at June 30, 2020 2,638,480 $ 7.14 8.54 $ 33,882,315 |
Schedule of Fair Value Assumptions | Six months ended June 30, 2020 June 30, 2019 Volatility 186.91-191.05 172.99-291.61 Expected term (in years) 5.0-6.25 5.0 Risk-free rate 0.34-0.54 % 1.96-2.49 % Expected dividend yield — % — % |
Schedule of Nonvested Restricted Stock Units Activity | Weighted Average Grant Date Fair Number of Shares Value Outstanding at December 31, 2019 7,091,789 $ 7.78 Granted 2,982,829 17.33 Vested (790,337) 8.10 Forfeited (51,666) 11.24 Outstanding at June 30, 2020 9,232,615 $ 10.82 |
Schedule of stock-based compensation expense | The following table summarizes stock-based compensation expense information about restricted stock and stock options for the three and six months ended June 30, 2020: Three months and Six months ended June 30, June 30, (in thousands) 2020 2020 Stock-based compensation expense associated with restricted stock $ 6,975 $ 14,095 Stock-based compensation expense associated with option grants 395 4,343 Total $ 7,370 $ 18,438 |
Schedule of Warrants Activity | Weighted- average exercise Aggregate Warrants price intrinsic value Outstanding at December 31, 2019 147,058 $ 4.08 $ 1,032,347 Issued — — — Exercised — — — Expired — — — Outstanding at June 30, 2020 147,058 $ 4.08 $ 2,264,693 |
OTHER LIABILITIES (Tables)
OTHER LIABILITIES (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
OTHER LIABILITIES | |
Schedule of Debt | The following is a summary of notes payable included in other current liabilities on the Company’s condensed consolidated balance sheets: (in thousands) June 30, 2020 December 31, 2019 Non- Non- Current current Current current portion, portion, portion, portion, net net Total net net Total Convertible 5% Notes Payable $ 343 $ — $ 343 $ 190 $ — $ 190 Totals $ 343 $ — $ 343 $ 190 $ — $ 190 |
LONG-TERM DEBT (Tables)
LONG-TERM DEBT (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
LONG-TERM DEBT. | |
Schedule of key assumptions | The Company estimated the fair value of the Warrant using the Black-Scholes model based on the following key assumptions: Exercise Price $ 4.08 Common share price on date of issuance $ 6.80 Volatility 195.9 % Risk-free interest rate 2.63 % Expected dividend yield -- % Contractual term (in years) 7.00 years |
Schedule of long-term debt | Long-term debt as of June 30, 2020 is as follows: June 30, (in thousands) 2020 Long-term debt $ 30,000 End of term fee 975 30,975 Less: unamortized debt issuance costs (1,542) 29,433 Less: current portion (7,200) Long-term debt non-current $ 22,233 |
LEASES (Tables)
LEASES (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
LEASES | |
Schedule of lease cost | Three months Six months ended, ended, June 30, June 30, (in thousands) 2020 2020 Operating lease cost $ 570 $ 1,077 Net lease cost $ 570 $ 1,077 |
Schedule of classification of lease liabilities | The balance sheet classification of lease liabilities was as follows: June 30, (in thousands) 2020 Liabilities Lease liability current portion $ 1,655 Lease liability non-current 9,938 Total lease liability $ 11,593 |
Schedule of lease liability maturity | As of June 30, 2020, the maturities of lease liabilities were as follows: Operating (in thousands) leases Remainder of 2020 $ 948 2021 1,889 2022 1,911 2023 1,913 2024 1,796 After 2024 10,615 Total lease payments 19,072 Less: interest (7,479) Present value of lease liabilities(*) $ 11,593 (*) As our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date and considering the term of the lease to determine the present value of lease payments. We used the incremental borrowing rate of 10.25% on February 28, 2019, for operating leases that commenced prior to that date. |
ORGANIZATION AND SUMMARY OF S_4
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Accumulated deficit | $ 805,215 | $ 701,216 |
Cash and cash equivalents, and investment securities | 275,600 | |
Restricted cash pledge | 1,300 | 1,300 |
Prepaid research and development | $ 3,832 | $ 8,105 |
ORGANIZATION AND SUMMARY OF S_5
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Computation of diluted loss per share (Details) - shares | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Potentially dilutive securities excluded from calculation | 10,535,748 | 7,844,712 | 10,535,748 | 7,844,712 |
Unvested Restricted stock [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Potentially dilutive securities excluded from calculation | 7,732,615 | 5,137,196 | ||
Options [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Potentially dilutive securities excluded from calculation | 2,638,480 | 2,543,710 | ||
Warrant [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Potentially dilutive securities excluded from calculation | 147,058 | 147,058 | ||
Share Issuable Upon Note Conversion [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Potentially dilutive securities excluded from calculation | 17,595 | 16,748 |
CASH AND CASH EQUIVALENTS - Sum
CASH AND CASH EQUIVALENTS - Summary of cash and cash equivalents (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 | Jun. 30, 2019 |
CASH. AND CASH EQUIVALENTS | |||
Checking and bank deposits | $ 245,054 | $ 110,135 | |
Money market funds | 15,458 | 2,502 | |
Total | $ 260,512 | $ 112,637 | $ 57,228 |
INVESTMENT SECURITIES - Summary
INVESTMENT SECURITIES - Summary of investment securities (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Amortized cost, as adjusted | $ 15,058 | $ 27,798 |
Gross unrealized holding gains | 26 | 28 |
Gross unrealized holding losses | 0 | 0 |
Estimated fair value | 15,084 | 27,826 |
Short-term Investments [Member] | Obligations of domestic governmental agencies [Member] | ||
Amortized cost, as adjusted | 15,058 | 27,798 |
Gross unrealized holding gains | 26 | 28 |
Gross unrealized holding losses | 0 | 0 |
Estimated fair value | $ 15,084 | $ 27,826 |
FAIR VALUE MEASUREMENTS (Detail
FAIR VALUE MEASUREMENTS (Details) $ / shares in Units, item in Thousands, $ in Millions | 1 Months Ended | 6 Months Ended | 12 Months Ended |
Mar. 31, 2010USD ($)item$ / shares | Jun. 30, 2020USD ($)itempayment | Dec. 31, 2019USD ($) | |
Fair Value Measurement [Line Items] | |||
Cumulative liability | $ 19.8 | $ 19.3 | |
Manhattan and Ariston Pharmaceuticals Merger [Member] | |||
Fair Value Measurement [Line Items] | |||
Notes Issued | $ 15.5 | ||
Debt instrument, term | 5 years | ||
Det instrument rate | 5.00% | ||
Debt Instrument convertible conversion price | $ / shares | $ 1,125 | ||
Percentage of cash proceeds from operation to repay convertible debt | 50.00% | ||
Number of obligations | item | 0 | ||
Convertible Notes Payable [Member] | |||
Fair Value Measurement [Line Items] | |||
Det instrument rate | 5.00% | 5.00% | 5.00% |
Debt Instrument convertible conversion price | $ / shares | $ 1,125 | ||
Percentage of cash proceeds from operation to repay convertible debt | 50.00% | ||
Number of obligations | item | 0 | ||
Cumulative liability | $ 19.8 | $ 19.3 | |
Number of payments | payment | 0 |
FAIR VALUE MEASUREMENTS - Finan
FAIR VALUE MEASUREMENTS - Financial liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
5% Notes | $ 343 | $ 190 |
Totals | 343 | 190 |
Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
5% Notes | 0 | 0 |
Totals | 0 | 0 |
Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
5% Notes | 0 | 0 |
Totals | 0 | 0 |
Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
5% Notes | 343 | 190 |
Totals | $ 343 | $ 190 |
FAIR VALUE MEASUREMENTS - Summa
FAIR VALUE MEASUREMENTS - Summary of changes in Level 3 instruments (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2020USD ($) | |
FAIR VALUE MEASUREMENTS | |
Balance at beginning of period | $ 190 |
Interest accrued on face value of 5% Notes | 484 |
Change in fair value of Level 3 liabilities | (331) |
Balance at end of period | $ 343 |
STOCKHOLDERS' EQUITY (Details)
STOCKHOLDERS' EQUITY (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||||
May 31, 2020 | Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | Sep. 05, 2019 | |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 | |||||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | |||||
Common Stock, Shares Authorized | 150,000,000 | 150,000,000 | 150,000,000 | ||||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | $ 0.001 | ||||
Offering costs | $ 10,900 | $ 10,900 | |||||
Expenses on stock options | $ 7,370 | 18,438 | $ 3,639 | ||||
Warrant [Member] | |||||||
Expenses on stock options | $ 0 | 0 | |||||
Unvested Restricted stock [Member] | |||||||
Restricted stock outstanding | 9,232,615 | 9,232,615 | 7,091,789 | ||||
Expenses on stock options | $ 7,000 | $ 1,000 | $ 14,100 | 2,100 | |||
Number of shares granted | 2,982,829 | ||||||
Total unrecognized compensation expense related to unvested time-based restricted stock | 31,000 | $ 31,000 | |||||
Weighted-average period of recognition for total unrecognized compensation expense related to unvested time-based restricted stock | 1 year 1 month 6 days | ||||||
Employee Stock Option [Member] | |||||||
Expenses on stock options | 400 | $ 800 | $ 4,300 | $ 1,500 | |||
Total unrecognized compensation expense related to unvested time-based restricted stock | $ 3,100 | $ 3,100 | |||||
Weighted-average period of recognition for total unrecognized compensation expense related to unvested time-based restricted stock | 1 year 6 months | ||||||
Milestone Based Restricted Stock [Member] | |||||||
Restricted stock outstanding | 4,559,040 | 4,559,040 | |||||
2020 ATM [Member] | |||||||
Percent of commission rate | 3.00% | ||||||
Shares sold | 4,535,608 | ||||||
Gross proceeds | $ 77,400 | ||||||
Share price in offering | $ 17.07 | $ 17.07 | |||||
Proceeds from offering | $ 76,000 | ||||||
Underwritten Public Offering [Member] | |||||||
Share Price | $ 18 | ||||||
Proceeds from offering | $ 165,100 | ||||||
Issuance of common stock (net of offering costs) (in shares) | 8,500,000 | ||||||
Payments of underwriting discounts and offering expenses | $ 10,600 | ||||||
Professional fees | 300 | ||||||
Offering costs | $ 10,900 | ||||||
Over-Allotment Option [Member] | |||||||
Issuance of common stock (net of offering costs) (in shares) | 1,275,000 | ||||||
Amended and Restated 2012 Incentive Plan [Member] | |||||||
Common Stock, Shares Authorized | 8,000,000 | 8,000,000 | |||||
Number of additional shares that may be issued | 5,804,913 | 5,804,913 | |||||
Amended and Restated 2012 Incentive Plan [Member] | Unvested Restricted stock [Member] | |||||||
Restricted stock outstanding | 9,232,615 | 9,232,615 | |||||
Amended and Restated 2012 Incentive Plan [Member] | Employee Stock Option [Member] | |||||||
Restricted stock outstanding | 2,638,480 | 2,638,480 |
STOCKHOLDERS' EQUITY - Stock op
STOCKHOLDERS' EQUITY - Stock option activity (Details) - Employee Stock Option [Member] - USD ($) $ / shares in Units, $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2020 | Dec. 31, 2019 | |
Equity Incentive Plans Stock Option Activity [Line Items] | ||
Number of shares, Outstanding Beginning Balance | 2,605,730 | |
Number of shares, Granted. | 75,000 | |
Number of shares, Exercised | (23,500) | |
Number of shares, Forfeited | (18,750) | |
Number of shares, Expired | 0 | |
Number of shares, Outstanding Ending Balance | 2,638,480 | 2,605,730 |
Weighted - average exercise price, Outstanding Beginning Balance | $ 6.73 | |
Weighted - average exercise price, Granted | 8.21 | |
Weighted - average exercise price, Exercised | 4.10 | |
Weighted - average exercise price, Forfeited | 4.10 | |
Weighted - average exercise price, Expired | 0 | |
Weighted - average exercise price, Outstanding Ending Balance | $ 7.14 | $ 6.73 |
Weighted - average Contractual Term | 8 years 6 months 14 days | 8 years 11 months 1 day |
Aggregate Intrinsic Value, Outstanding | $ 33,882,315 | $ 11,706,110 |
STOCKHOLDERS' EQUITY - Fair val
STOCKHOLDERS' EQUITY - Fair value assumptions of options (Details) | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Volatility, minimum | 186.91% | 172.99% |
Volatility, maximum | 191.05% | 291.61% |
Risk-free rate, minimum | 0.34% | 1.96% |
Risk-free rate, maximum | 0.54% | 2.49% |
Expected dividend yield | 0.00% | 0.00% |
Minimum [Member] | ||
Expected term (in years) | 5 years | 5 years |
Maximum [Member] | ||
Expected term (in years) | 6 years 3 months | 6 years 3 months |
STOCKHOLDERS' EQUITY - Summary
STOCKHOLDERS' EQUITY - Summary of restricted shares (Details) - Unvested Restricted stock [Member] | 6 Months Ended |
Jun. 30, 2020$ / sharesshares | |
Equity Incentive Plans Restricted Stock Activity [Line Items] | |
Number of Shares, Outstanding at Beginning Balance | shares | 7,091,789 |
Number of Shares, Granted | shares | 2,982,829 |
Number of Shares, Vested | shares | (790,337) |
Number of Shares, Forfeited | shares | (51,666) |
Number of Shares, Outstanding at Ending Balance | shares | 9,232,615 |
Weighted Average Grant Date Fair Value, Outstanding at Beginning Balance | $ / shares | $ 7.78 |
Weighted Average Grant Date Fair Value, Granted | $ / shares | 17.33 |
Weighted Average Grant Date Fair Value, Vested | $ / shares | 8.10 |
Weighted Average Grant Date Fair Value, Forfeited | $ / shares | 11.24 |
Weighted Average Grant Date Fair Value, Outstanding at Ending Balance | $ / shares | $ 10.82 |
STOCKHOLDERS' EQUITY - Stock-Ba
STOCKHOLDERS' EQUITY - Stock-Based Compensation (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2020 | Jun. 30, 2019 | |
Equity [Abstract] | |||
Stock-based compensation expense associated with restricted stock | $ 6,975 | $ 14,095 | |
Stock-based compensation expense associated with option grants | 395 | 4,343 | |
Share-based Compensation, Total | $ 7,370 | $ 18,438 | $ 3,639 |
STOCKHOLDERS' EQUITY - Warrant
STOCKHOLDERS' EQUITY - Warrant activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 6 Months Ended | |
Jun. 30, 2020 | Dec. 31, 2019 | |
Statement of Stockholders' Equity [Abstract] | ||
Warrants, Outstanding at Beginning Balance | 147,058 | |
Warrants, Issued | 0 | |
Warrants, Exercised | 0 | |
Warrants, Expired | 0 | |
Warrants, Outstanding at Ending Balance | 147,058 | |
Weighted - average exercise price of Warrants, Outstanding at Beginning Balance | $ 4.08 | |
Weighted - average exercise price of Warrants, Issued | 0 | |
Weighted - average exercise price of Warrants, Exercised | 0 | |
Weighted - average exercise price of Warrants, Expired | 0 | |
Weighted - average exercise price of Warrants, Outstanding at Ending Balance | $ 4.08 | |
Aggregate Intrinsic Value of Warrants, Outstanding | $ 2,264,693 | $ 1,032,347 |
OTHER LIABILITIES - Notes payab
OTHER LIABILITIES - Notes payables in other current liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Notes payable, Current portion, net | $ 343 | $ 190 |
Notes Payable, Noncurrent, net | 0 | 0 |
Notes Payable. | 343 | 190 |
Convertible Notes [Member] | ||
Notes payable, Current portion, net | 343 | 190 |
Notes Payable, Noncurrent, net | 0 | 0 |
Notes Payable. | $ 343 | $ 190 |
OTHER LIABILITIES (Details)
OTHER LIABILITIES (Details) $ / shares in Units, item in Thousands, $ in Millions | 1 Months Ended | 6 Months Ended | 12 Months Ended |
Mar. 31, 2010$ / shares | Jun. 30, 2020USD ($)itempayment | Dec. 31, 2019USD ($) | |
Cumulative Liability | $ 19.8 | $ 19.3 | |
Agreement total costs | 51.8 | ||
Agreement costs included in current liabilities | 24.8 | ||
Construction Contract Cost, Progress Payment Offset | 27 | ||
Agreement costs included in noncurrent liabilities | $ 0 | ||
Percentage Of Administrative Fee | 6.00% | ||
Interest Expenses | $ 2.2 | ||
Convertible Notes Payable [Member] | |||
Debt Instrument convertible conversion price | $ / shares | $ 1,125 | ||
Det instrument rate | 5.00% | 5.00% | 5.00% |
Number of obligations | item | 0 | ||
Percentage Of Cash Proceeds From Operation To Repay Convertible Debt | 50.00% | ||
Cumulative Liability | $ 19.8 | $ 19.3 | |
Number of payments | payment | 0 | ||
Construction Contract Cost, Progress Payment Offset | $ 0 |
LONG-TERM DEBT (Details)
LONG-TERM DEBT (Details) $ in Thousands | Feb. 28, 2019USD ($)installmentloanD |
Prime Rate [Member] | Minimum [Member] | |
Debt Instrument [Line Items] | |
Interest rate ( as a percent) | 4.75% |
Prime Rate [Member] | Maximum [Member] | |
Debt Instrument [Line Items] | |
Interest rate ( as a percent) | 10.25% |
Term Loan [Member] | |
Debt Instrument [Line Items] | |
Maximum term loan facility | $ 60,000 |
Amount drawn on first advance | $ 30,000 |
Number of additional advances | loan | 2 |
Additional Advances Drawn | $ 10,000 |
Debt Instrument, Fourth Advance Available | 10,000 |
Minimum incremental borrowings | 5,000 |
Minimum amount raised from unrestricted cash proceeds | $ 150,000 |
Number of amortization payments installments | installment | 18 |
Number of interest only payments installments | installment | 12 |
Number of business days | D | 7 |
Expected prepayment on outstanding advances | $ 5,000 |
Prepayment charge (as a percent) | 3.50% |
Interest on past due outstanding (as a percent) | 4.00% |
Minimum indebtedness by borrower in default | $ 750 |
Term Loan [Member] | Maximum [Member] | |
Debt Instrument [Line Items] | |
Number of advances | loan | 4 |
Term Loan [Member] | Within First twelve Months Of Closing Date [Member] | |
Debt Instrument [Line Items] | |
Prepayment charge (as a percent) | 3.00% |
Term Loan [Member] | After Twelve Months But On Or Before Twenty Four Months [Member] | |
Debt Instrument [Line Items] | |
Prepayment charge (as a percent) | 1.50% |
Term Loan [Member] | After Twenty Four Months Of Closing Date [Member] | |
Debt Instrument [Line Items] | |
Prepayment charge (as a percent) | 0.00% |
LONG-TERM DEBT - Warrants fair
LONG-TERM DEBT - Warrants fair value (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2020 | Jun. 30, 2019 | |
Amortization of Debt Issuance Costs | $ 463 | $ 308 | |
Unamortized Debt Issuance Expense | $ 1,542 | $ 1,542 | |
Warrant [Member] | |||
Warrant coverage percentage | 2.00% | ||
Warrants issued | 147,058 | 147,058 | |
Warrant, purchase price | $ 4.08 | $ 4.08 | |
Class Of Warrant Or Right Fair Value | $ 1,000 | $ 1,000 | |
Warrant exercisable term | 7 years | ||
Financing expenses, Hercules Loan Agreement | $ 2,800 | ||
Amortization of Debt Issuance Costs | 200 | 500 | |
Unamortized Debt Issuance Expense | $ 1,500 | $ 1,500 |
LONG-TERM DEBT - Estimated fair
LONG-TERM DEBT - Estimated fair value of warrants (Details) - $ / shares | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Expected dividend yield | 0.00% | 0.00% |
Warrant [Member] | Measurement Input, Exercise Price [Member] | ||
Exercise Price | $ 4.08 | |
Warrant [Member] | Measurement Input, Share Price [Member] | ||
Common share price on date of issuance | $ 6.80 | |
Warrant [Member] | Measurement Input, Price Volatility [Member] | ||
Volatility | 195.90% | |
Warrant [Member] | Measurement Input, Risk Free Interest Rate [Member] | ||
Risk-free interest rate | 2.63% | |
Warrant [Member] | Measurement Input, Expected Term [Member] | ||
Warrants, contractual term | 7 years |
LONG-TERM DEBT - Summary (Detai
LONG-TERM DEBT - Summary (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
LONG-TERM DEBT. | ||
Long-term debt | $ 30,000 | |
End of term fee | 975 | |
Long-term debt, gross | 30,975 | |
Less: unamortized debt issuance costs | (1,542) | |
Long-term Debt | 29,433 | |
Less: Current portion | (7,200) | |
Long-term debt non-current | $ 22,233 | $ 28,970 |
LEASES (Details)
LEASES (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||||
Oct. 31, 2019USD ($) | Oct. 31, 2014USD ($)ft² | Dec. 31, 2014 | Jun. 30, 2020USD ($) | Dec. 31, 2019USD ($) | Feb. 28, 2019 | Jan. 01, 2019USD ($) | Apr. 30, 2018USD ($) | |
Right of use asset | $ 9,141 | $ 9,402 | ||||||
Operating Lease Liability | $ 11,593 | |||||||
Lease additional term | 1 year | |||||||
Minimum [Member] | ||||||||
Remaining lease term | 1 year | |||||||
Maximum [Member] | ||||||||
Remaining lease term | 12 years | |||||||
ASU 2016-02 | Restatement Adjustment | ||||||||
Right of use asset | $ 9,500 | |||||||
Operating Lease Liability | 8,100 | |||||||
Office Agreement [Member] | ||||||||
Percentage Of Occupancy | 45.00% | 45.00% | 61.00% | |||||
Area of Land | ft² | 24,000 | |||||||
Operating Lease Initial Commitment Period | 15 years | 15 years | ||||||
Average Annual Rental Payments | $ 300 | $ 1,100 | $ 1,400 | |||||
Rent expense | 200 | |||||||
Right of use asset | 9,100 | 7,700 | ||||||
Operating Lease Liability | $ 11,600 | $ 9,300 | ||||||
Initial commitment period for office lease space | 3 years | |||||||
Line of credit | $ 600 | |||||||
Additional collateral pledged | $ 600 | |||||||
Weighted-average discount rate for operating leases | 10.25% | 10.25% | ||||||
Weighted-average remaining operating lease term | 8 years | |||||||
Operating Lease, Payments, Use | $ 2,400 | |||||||
NJ Lease [Member] | ||||||||
Operating Lease Initial Commitment Period | 5 years |
LEASES - Components of lease ex
LEASES - Components of lease expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended |
Jun. 30, 2020 | Jun. 30, 2020 | |
LEASES | ||
Operating lease cost | $ 570 | $ 1,077 |
Net lease cost | $ 570 | $ 1,077 |
LEASES - Classification of leas
LEASES - Classification of lease liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
LEASES | ||
Lease liability current portion | $ 1,655 | $ 1,616 |
Lease liability non-current | 9,938 | $ 10,218 |
Total lease liability | $ 11,593 |
LEASES - Maturities of lease li
LEASES - Maturities of lease liabilities (Details) $ in Thousands | Jun. 30, 2020USD ($) |
LEASES | |
Remainder of 2020 | $ 948 |
2021 | 1,889 |
2022 | 1,911 |
2023 | 1,913 |
2024 | 1,796 |
After 2024 | 10,615 |
Total lease payments | 19,072 |
Less: Interest | (7,479) |
Total lease liability | $ 11,593 |
LICENSE AGREEMENTS (Details)
LICENSE AGREEMENTS (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||||||
Jul. 31, 2019 | Apr. 30, 2018 | May 31, 2016 | Dec. 31, 2012 | Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | Nov. 30, 2012 | |
License revenue | $ 38 | $ 38 | $ 76 | $ 76 | ||||||
JBET Agreement [Member] | ||||||||||
Upfront fee | 1,000 | |||||||||
Income taxes | 177,000 | |||||||||
TG-1101 [Member] | ||||||||||
Upfront fee | $ 5,000 | $ 2,000 | ||||||||
Income taxes | $ 300 | |||||||||
Term after first commercial sale | 15 years | |||||||||
License revenue | 38,000 | 38,000 | 76,000 | 76,000 | ||||||
Deferred Revenue | 800 | 800 | $ 900 | |||||||
Deferred Revenue, Current | 152,000 | 152,000 | $ 152,000 | |||||||
TG-1701 [Member] | ||||||||||
Upfront fee | $ 100 | $ 1,000 | 350,000 | |||||||
Manufacturing expense | $ 900 | $ 500 | 1,800 | $ 500 | ||||||
TG-1801 [Member] | ||||||||||
Upfront fee | $ 3,000 | |||||||||
Additional payments on achievement of certain milestones | $ 185,000 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||||||||
Oct. 31, 2019USD ($) | Jun. 30, 2019USD ($) | Oct. 31, 2014USD ($)ft² | Jun. 30, 2020USD ($) | Jun. 30, 2019USD ($) | Dec. 31, 2014 | Jun. 30, 2020USD ($) | Jun. 30, 2019USD ($) | Dec. 31, 2019USD ($) | Jan. 01, 2019USD ($) | Apr. 30, 2018USD ($) | |
Related Party Transaction [Line Items] | |||||||||||
Operating Lease Liability | $ 11,593 | $ 11,593 | |||||||||
Right of use asset | 9,141 | $ 9,141 | $ 9,402 | ||||||||
Office Agreement [Member] | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Percentage Of Occupancy | 45.00% | 45.00% | 61.00% | ||||||||
Area of leases office space | ft² | 24,000 | ||||||||||
Operating Lease Initial Commitment Period | 15 years | 15 years | |||||||||
Average Annual Rental Payments | $ 300 | $ 1,100 | $ 1,400 | ||||||||
Operating Lease Liability | 11,600 | 11,600 | $ 9,300 | ||||||||
Right of use asset | 9,100 | 9,100 | $ 7,700 | ||||||||
Initial commitment period for office lease space | 3 years | ||||||||||
Long-term Line of Credit | $ 600 | ||||||||||
Additional collateral pledged | $ 600 | ||||||||||
Upfront fee | 40 | $ 1,100 | 1,000 | $ 1,400 | |||||||
Shared Services Agreement [Member] | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Costs and Expenses, Related Party | $ 200 | $ 200 | $ 400 | $ 400 | |||||||
Collaboration Agreement [Member] | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Upfront fee | $ 1,000 |