Document And Entity Information
Document And Entity Information - shares | 3 Months Ended | |
Mar. 31, 2018 | May 01, 2018 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q1 | |
Entity Registrant Name | Protalix BioTherapeutics, Inc. | |
Entity Central Index Key | 1,006,281 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Trading Symbol | PLX | |
Entity Common Stock, Shares Outstanding | 145,569,955 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
CURRENT ASSETS: | ||
Cash and cash equivalents | $ 41,319 | $ 51,163 |
Accounts receivable - Trade | 4,756 | 1,721 |
Other assets | 2,594 | 1,934 |
Inventories | 7,019 | 7,833 |
Total current assets | 55,688 | 62,651 |
FUNDS IN RESPECT OF EMPLOYEE RIGHTS UPON RETIREMENT | 1,798 | 1,887 |
PROPERTY AND EQUIPMENT, NET | 7,311 | 7,676 |
Total assets | 64,797 | 72,214 |
Accounts payable and accruals: | ||
Trade | 4,872 | 7,521 |
Other | 10,697 | 9,310 |
Convertible notes | 5,930 | 5,921 |
Total current liabilities | 21,499 | 22,752 |
LONG TERM LIABILITIES: | ||
Convertible notes | 46,108 | 46,267 |
Deferred revenues | 29,030 | 26,851 |
Liability for employee rights upon retirement | 2,427 | 2,586 |
Other long term liabilities | 5,172 | 5,051 |
Total long term liabilities | 82,737 | 80,755 |
Total liabilities | 104,236 | 103,507 |
COMMITMENTS | ||
CAPITAL DEFICIENCY | ||
Total shareholders’ equity (capital deficiency) | (39,439) | (31,293) |
Total liabilities net of capital deficiency | $ 64,797 | $ 72,214 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | ||
REVENUES | $ 4,553 | $ 2,889 | |
COST OF REVENUES | (2,924) | (2,088) | |
GROSS PROFIT | 1,629 | 801 | |
RESEARCH AND DEVELOPMENT EXPENSES | [1] | (7,286) | (5,967) |
Less - grants | 843 | 1,338 | |
RESEARCH AND DEVELOPMENT EXPENSES, NET | (6,443) | (4,629) | |
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES | [1] | (2,498) | (2,537) |
OPERATING LOSS | (7,312) | (6,365) | |
FINANCIAL EXPENSES | (2,220) | (2,087) | |
FINANCIAL INCOME | 132 | 1,625 | |
LOSS FROM CHANGE IN FAIR VALUE OF CONVERTIBLE NOTES embedded derivative | (52,321) | ||
FINANCIAL (EXPENSES) INCOME, NET | (2,088) | (52,783) | |
LOSS FOR THE PERIOD | $ (9,400) | $ (59,148) | |
NET LOSS PER SHARE OF COMMON STOCK - BASIC AND DILUTED | $ (0.06) | $ (0.48) | |
WEIGHTED AVERAGE NUMBER OF SHARES OF COMMON STOCK USED IN COMPUTING LOSS PER SHARE - BASIC AND DILUTED | 145,305,982 | 124,467,602 | |
[1] | Includes share-based compensation |
CONDENSED CONSOLIDATED STATEME4
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Research and Development Expense [Member] | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Share-based compensation | $ 42 | $ 65 |
General and Administrative Expense [Member] | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||
Share-based compensation | $ 20 | $ 53 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (CAPITAL DEFICIENCY) - USD ($) $ in Thousands | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] | ||
Balance at Dec. 31, 2016 | $ (9,957) | $ 124 | $ 202,575 | $ (212,656) | ||
Balance (in shares) at Dec. 31, 2016 | [1] | 124,134,085 | ||||
Share-based compensation related to stock options | 118 | 118 | ||||
Convertible note conversions | 517 | $ 1 | 516 | |||
Convertible note conversions (in shares) | [1] | 923,018 | ||||
Net loss for the period | (59,148) | (59,148) | ||||
Balance at Mar. 31, 2017 | (68,470) | $ 125 | 203,209 | (271,804) | ||
Balance (in shares) at Mar. 31, 2017 | [1] | 125,057,103 | ||||
Balance at Dec. 31, 2017 | (31,293) | $ 144 | 266,495 | (297,932) | ||
Balance (in shares) at Dec. 31, 2017 | [1] | 143,728,797 | ||||
Share-based compensation related to stock options | 46 | 46 | ||||
Share-based compensation related to restricted stock award, net of forfeitures | 16 | [2] | 16 | |||
Share-based compensation related to restricted stock award, net of forfeitures (in shares) | [1] | 29,898 | ||||
Convertible note conversions | 1,192 | $ 2 | 1,190 | |||
Convertible note conversions (in shares) | [1] | 1,811,260 | ||||
Net loss for the period | (9,400) | (9,400) | ||||
Balance at Mar. 31, 2018 | $ (39,439) | $ 146 | $ 267,747 | $ (307,332) | ||
Balance (in shares) at Mar. 31, 2018 | [1] | 145,569,955 | ||||
[1] | Common Stock, $0.001 par value; Authorized as of March 31, 2018 and 2017 - 250,000,000. | |||||
[2] | Represents an amount less than $1. |
CONDENSED CONSOLIDATED STATEME6
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (CAPITAL DEFICIENCY) [Parenthetical] - $ / shares | Mar. 31, 2018 | Dec. 31, 2017 |
Common stock, par value per share | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 250,000,000 | 250,000,000 |
CONDENSED CONSOLIDATED STATEME7
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net loss | $ (9,400) | $ (59,148) |
Adjustments required to reconcile net loss to net cash used in operating activities: | ||
Share based compensation | 62 | 118 |
Depreciation | 430 | 492 |
Financial (income) expenses, net (mainly exchange differences) | 28 | (9) |
Changes in accrued liability for employee rights upon retirement | (124) | 42 |
Gain on amounts funded in respect of employee rights upon retirement | (44) | (20) |
Net loss (income) in connection with conversions of convertible notes | 218 | (1,445) |
Change in fair value of convertible notes embedded derivative | 52,321 | |
Amortization of debt issuance costs and debt discount | 619 | 590 |
Issuance of shares for interest payment in connection with conversions of convertible notes | 205 | |
Changes in operating assets and liabilities: | ||
Increase in deferred revenues (including non-current portion) | 2,179 | 1,088 |
Increase in accounts receivable and other assets | (3,512) | (3,092) |
Decrease (increase) in inventories | 814 | (1,855) |
Increase (decrease) in accounts payable and accruals | (1,009) | 2,370 |
Increase in other long term liabilities | 121 | |
Net cash used in continuing operations | (9,413) | (8,548) |
Net cash provided by discontinued operations | 122 | |
Net cash used in operating activities | (9,413) | (8,426) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Purchase of property and equipment | (249) | (220) |
Increase in restricted deposit | (188) | (23) |
Amounts funded in respect of employee rights upon retirement, net | 109 | (40) |
Net cash used in investing activities | (328) | (283) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Net payment for conversion of convertible notes | (6,726) | |
Net cash used in financing activities | (6,726) | |
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS | (103) | 171 |
NET DECREASE IN CASH AND CASH EQUIVALENTS | (9,844) | (15,264) |
BALANCE OF CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD | 51,163 | 63,281 |
BALANCE OF CASH AND CASH EQUIVALENTS AT END OF PERIOD | 41,319 | 48,017 |
SUPPLEMENTARY INFORMATION ON INVESTING AND FINANCING ACTIVITIES NOT INVOLVING CASH FLOWS: | ||
Purchase of property and equipment | 342 | 636 |
Convertible notes conversions | 987 | 517 |
SUPPLEMENTARY DISCLOSURE ON CASH FLOWS | ||
Interest paid | $ 145 | $ 432 |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Mar. 31, 2018 | |
SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |
SIGNIFICANT ACCOUNTING POLICIES | NOTE 1 SIGNIFICANT ACCOUNTING POLICIES a. General Protalix BioTherapeutics, Inc. (collectively with its subsidiaries, the “Company”), and its wholly-owned subsidiaries, Protalix Ltd. and Protalix B.V. (the “Subsidiaries”), are biopharmaceutical companies focused on the development and commercialization of recombinant therapeutic proteins based on the Company’s proprietary ProCellEx ® ® The Company’s product pipeline currently includes, among other candidates: (1) pegunigalsidase alfa, or PRX-102, a therapeutic protein candidate for the treatment of Fabry disease, a rare, genetic lysosomal disorder; (2) alidornase alfa, or PRX-110, a proprietary plant cell recombinant human Deoxyribonuclease 1, or DNase, under development for the treatment of Cystic Fibrosis, to be administered by inhalation; and (3) OPRX-106, the Company’s oral antiTNF product candidate which is being developed as an orally-delivered anti-inflammatory treatment using plant cells as a natural capsule for the expressed protein. Obtaining marketing approval with respect to any product candidate in any country is directly dependent on the Company’s ability to implement the necessary regulatory steps required to obtain such approvals. The Company cannot reasonably predict the outcome of these activities. Since its approval by the FDA, taliglucerase alfa has been marketed by Pfizer Inc. (“Pfizer”), as provided in the exclusive license and supply agreement by and between Protalix Ltd. and Pfizer, which is referred to herein as the Pfizer Agreement. In October 2015, the Company entered into an Amended and Restated Exclusive License and Supply Agreement (the “Amended Pfizer Agreement”) which amends and restates the Pfizer Agreement in its entirety. Pursuant to the Amended Pfizer Agreement, the Company sold to Pfizer its share in the collaboration created under the Pfizer Agreement for the commercialization of Elelyso in exchange for a cash payment equal to $ 36.0 100 On June 18, 2013, the Company entered into a Supply and Technology Transfer Agreement (the “Brazil Agreement”) with Fundação Oswaldo Cruz (“Fiocruz”), an arm of the Brazilian Ministry of Health (the “Brazilian MoH”), for taliglucerase alfa. Fiocruz’s purchases of alfataliglicerase to date have been significantly below certain agreed upon purchase milestones and, accordingly, the Company has the right to terminate the Brazil Agreement. Notwithstanding, the Company is, at this time, continuing to supply alfataliglicerase to Fiocruz under the Brazil Agreement, and patients continue to be treated with alfataliglicerase in Brazil. Approximately 10 In 2017, the Company received a purchase order from the Brazilian MoH for the purchase of alfataliglicerase for the treatment of Gaucher patients in Brazil for consideration of approximately $ 24.3 7.1 2.6 On October 19, 2017, Protalix Ltd. and Chiesi Farmaceutici S.p.A. (“Chiesi”) entered into an Ex-US license (the “Chiesi Agreement”) pursuant to which Chiesi was granted an exclusive license for all markets outside of the United States to commercialize pegunigalsidase alfa. Under the terms and conditions of the Chiesi Agreement, Protalix Ltd. retained the right to commercialize pegunigalsidase in the United States. Under the Chiesi Agreement, Chiesi made an upfront payment to Protalix Ltd. of $ 25.0 25.0 10.0 320.0 Under the terms of the Chiesi Agreement, Protalix Ltd. will manufacture all of the PRX-102 needed for all purposes under the agreement, subject to certain exceptions, and Chiesi will purchase pegunigalsidase alfa from Protalix, subject to certain terms and conditions. Chiesi will make tiered payments of 15 35 Based on its current cash resources and commitments, the Company believes it will be able to maintain its current planned development activities and the corresponding level of expenditures for at least 12 months from the date of approval of the March 31, 2018 financial statements, although no assurance can be given that it will not need additional funds prior to such time. If there are unexpected increases in general and administrative expenses or research and development expenses, the Company may need to seek additional financing. b. Basis of presentation The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information. Accordingly, they do not include all of the information and notes required by GAAP for annual financial statements. In the opinion of management, all adjustments (of a normal recurring nature) considered necessary for a fair statement of the results for the interim periods presented have been included. Operating results for the interim period are not necessarily indicative of the results that may be expected for the full year. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements in the Annual Report on Form 10-K for the year ended December 31, 2017, filed by the Company with the Commission. The comparative balance sheet at December 31, 2017 has been derived from the audited financial statements at that date. c. Net loss per share Basic and diluted loss per share (“LPS”) are computed by dividing net loss by the weighted average number of shares of the Company’s common stock, par value $ 0.001 Diluted LPS is calculated in continuing operations. The calculation of diluted LPS does not include 78,142,133 73,800,491 d. Revenue recognition 1. Revenues from supply agreements The Company recognizes revenues from supply agreements and from selling products when control is transferred to the customer and collectability is probable. 2. Revenues from Chiesi Agreement As Chiesi is obligated to acquire pegunigalsidase alfa from the Company and the development services are not considered distinct, development and manufacturing of a product to be commercialized by Chiesi is viewed as a single performance obligation. Since there is only one performance obligation, all payments received by Chiesi prior to the satisfaction of the Company’s obligation will be deferred. Therefore, the $ 25.0 e. Recently adopted standards In May 2014, the Financial Accounting Standards Board (“FASB”) issued guidance on revenues from contracts with customers that will supersede most current revenue recognition guidance, including industry-specific guidance. The underlying principle is to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which an entity expects to be entitled to in exchange for those goods or services. The guidance provides a five-step analysis of transactions to determine when and how revenue is recognized. Other major provisions require capitalization of certain contracts costs, consideration of the time value of money in the transaction price, and allowing estimates of variable consideration to be recognized before contingencies are resolved in certain circumstances. The guidance also requires enhanced disclosures regarding the nature, amount timing and uncertainty of revenues and cash flows arising from an entity’s contracts with customers. The guidance is effective for the interim and annual periods beginning on or after December 15, 2017. On January 1, 2018, the Company adopted the new accounting standard, ASC 606, Revenue from Contracts with Customers, and all the related amendments, using the modified retrospective method. The implementation of this Accounting Standards Update (ASU) did not have a material impact on the Company’s consolidated financial statements. In January 2016, the FASB issued ASU, No. 2016-01, Financial Instruments-Overall: Recognition and Measurement of Financial Assets and Financial Liabilities. The guidance affects the accounting for equity investments, financial liabilities under the fair value option and the presentation and disclosure requirements of financial instruments. The guidance is effective for annual reporting periods beginning after December 15, 2017. The implementation of this ASU did not have a material impact on the Company’s consolidated financial statements. |
INVENTORIES
INVENTORIES | 3 Months Ended |
Mar. 31, 2018 | |
INVENTORIES [Abstract] | |
INVENTORIES | NOTE 2 - INVENTORIES March 31, December 31, 2018 2017 (U.S. dollars in thousands) Raw materials $ 3,529 $ 3,838 Work in progress 317 485 Finished goods 3,173 3,510 Total inventory $ 7,019 $ 7,833 |
FAIR VALUE MEASUREMENT
FAIR VALUE MEASUREMENT | 3 Months Ended |
Mar. 31, 2018 | |
FAIR VALUE MEASUREMENT [Abstract] | |
FAIR VALUE MEASUREMENT | NOTE 3 FAIR VALUE MEASUREMENT The Company measures fair value and discloses fair value measurements for financial assets and liabilities. Fair value is based on the price that would be received from the sale of an asset, or paid to transfer a liability, in an orderly transaction between market participants at the measurement date. The accounting standard establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three broad levels, which are described below: Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs. Level 2: Observable prices that are based on inputs not quoted on active markets, but corroborated by market data. Level 3: Unobservable inputs are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs. In determining fair value, the Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible and considers counterparty credit risk in its assessment of fair value. The fair value of the financial instruments included in the working capital of the Company is usually identical or close to their carrying value. The fair value of the convertible notes derivative is based on Level 3 measurement. The fair value of the remaining $ 5.9 58.1 5.7 69.3 The Company prepared a valuation of the fair value of the 2013 Notes and the 2016 Notes (a Level 3 valuation) as of March 31, 2018. The values of these notes were estimated by implementing the binomial model. The liability component was valued based on the Income Approach. 2013 Notes 2016 Notes Stock price (USD) 0.5399 0.5399 Expected term (years) 0.46 3.63 Risk free rate 1.88% 2.45% Volatility 62.44% 70.96% Yield 12.89% 12.44% |
CONVERTIBLE NOTES
CONVERTIBLE NOTES | 3 Months Ended |
Mar. 31, 2018 | |
CONVERTIBLE NOTES [Abstract] | |
CONVERTIBLE NOTES | NOTE 4 CONVERTIBLE NOTES All of our outstanding convertible notes are accounted for using the guidance set forth in the FASB Accounting Standards Codification (ASC) 815 which requires that the Company determine whether the embedded conversion option must be separated and accounted for separately. ASC 470-20, regarding debt with conversion and other options, requires the issuer of a convertible debt instrument that may be settled in cash upon conversion to separately account for the liability (debt) and equity (conversion option) components of the instrument in a manner that reflects the issuer’s nonconvertible debt borrowing rate. The Company accounts for the 2013 Notes as a liability, on an aggregated basis, in their entirety. The 2016 Notes were accounted for partially as liability and equity components of the instrument and partially as a debt host contract with an embedded derivative resulting from the conversion feature. During the year ended December 31, 2017, the embedded derivative was reclassified to additional paid in capital. Issuance costs regarding the issuance of the 2016 Notes are amortized using the effective interest rate. The debt discount and debt issuance costs regarding the issuance of the 2013 Notes are deferred and amortized over the 2013 Notes period ( 5 During the three months ended March 31, 2018, note holders converted 1.0 aggregate principal amount of the 2016 Notes into a total of 1,338,707 11,668 As of March 31, 2018, a total of $ 58.1 5.9 2013 Notes |
REVENUES
REVENUES | 3 Months Ended |
Mar. 31, 2018 | |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS [Abstract] | |
REVENUES | NOTE 5 REVENUES The following table summarizes the Company’s disaggregation of revenues: March 31, (U.S. dollars in thousands) 2018 2017 Revenues: Pfizer $ 1,980 $ 1,646 Brazil $ 2,573 $ 1,243 $ 4,553 $ 2,889 |
SIGNIFICANT ACCOUNTING POLICI13
SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Mar. 31, 2018 | |
SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |
General | a. General Protalix BioTherapeutics, Inc. (collectively with its subsidiaries, the “Company”), and its wholly-owned subsidiaries, Protalix Ltd. and Protalix B.V. (the “Subsidiaries”), are biopharmaceutical companies focused on the development and commercialization of recombinant therapeutic proteins based on the Company’s proprietary ProCellEx ® ® The Company’s product pipeline currently includes, among other candidates: (1) pegunigalsidase alfa, or PRX-102, a therapeutic protein candidate for the treatment of Fabry disease, a rare, genetic lysosomal disorder; (2) alidornase alfa, or PRX-110, a proprietary plant cell recombinant human Deoxyribonuclease 1, or DNase, under development for the treatment of Cystic Fibrosis, to be administered by inhalation; and (3) OPRX-106, the Company’s oral antiTNF product candidate which is being developed as an orally-delivered anti-inflammatory treatment using plant cells as a natural capsule for the expressed protein. Obtaining marketing approval with respect to any product candidate in any country is directly dependent on the Company’s ability to implement the necessary regulatory steps required to obtain such approvals. The Company cannot reasonably predict the outcome of these activities. Since its approval by the FDA, taliglucerase alfa has been marketed by Pfizer Inc. (“Pfizer”), as provided in the exclusive license and supply agreement by and between Protalix Ltd. and Pfizer, which is referred to herein as the Pfizer Agreement. In October 2015, the Company entered into an Amended and Restated Exclusive License and Supply Agreement (the “Amended Pfizer Agreement”) which amends and restates the Pfizer Agreement in its entirety. Pursuant to the Amended Pfizer Agreement, the Company sold to Pfizer its share in the collaboration created under the Pfizer Agreement for the commercialization of Elelyso in exchange for a cash payment equal to $ 36.0 100 On June 18, 2013, the Company entered into a Supply and Technology Transfer Agreement (the “Brazil Agreement”) with Fundação Oswaldo Cruz (“Fiocruz”), an arm of the Brazilian Ministry of Health (the “Brazilian MoH”), for taliglucerase alfa. Fiocruz’s purchases of alfataliglicerase to date have been significantly below certain agreed upon purchase milestones and, accordingly, the Company has the right to terminate the Brazil Agreement. Notwithstanding, the Company is, at this time, continuing to supply alfataliglicerase to Fiocruz under the Brazil Agreement, and patients continue to be treated with alfataliglicerase in Brazil. Approximately 10 In 2017, the Company received a purchase order from the Brazilian MoH for the purchase of alfataliglicerase for the treatment of Gaucher patients in Brazil for consideration of approximately $ 24.3 7.1 2.6 On October 19, 2017, Protalix Ltd. and Chiesi Farmaceutici S.p.A. (“Chiesi”) entered into an Ex-US license (the “Chiesi Agreement”) pursuant to which Chiesi was granted an exclusive license for all markets outside of the United States to commercialize pegunigalsidase alfa. Under the terms and conditions of the Chiesi Agreement, Protalix Ltd. retained the right to commercialize pegunigalsidase in the United States. Under the Chiesi Agreement, Chiesi made an upfront payment to Protalix Ltd. of $ 25.0 25.0 10.0 320.0 Under the terms of the Chiesi Agreement, Protalix Ltd. will manufacture all of the PRX-102 needed for all purposes under the agreement, subject to certain exceptions, and Chiesi will purchase pegunigalsidase alfa from Protalix, subject to certain terms and conditions. Chiesi will make tiered payments of 15 35 Based on its current cash resources and commitments, the Company believes it will be able to maintain its current planned development activities and the corresponding level of expenditures for at least 12 months from the date of approval of the March 31, 2018 financial statements, although no assurance can be given that it will not need additional funds prior to such time. If there are unexpected increases in general and administrative expenses or research and development expenses, the Company may need to seek additional financing. |
Basis of presentation | b. Basis of presentation The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information. Accordingly, they do not include all of the information and notes required by GAAP for annual financial statements. In the opinion of management, all adjustments (of a normal recurring nature) considered necessary for a fair statement of the results for the interim periods presented have been included. Operating results for the interim period are not necessarily indicative of the results that may be expected for the full year. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements in the Annual Report on Form 10-K for the year ended December 31, 2017, filed by the Company with the Commission. The comparative balance sheet at December 31, 2017 has been derived from the audited financial statements at that date. |
Net loss per share | c. Net loss per share Basic and diluted loss per share (“LPS”) are computed by dividing net loss by the weighted average number of shares of the Company’s common stock, par value $ 0.001 Diluted LPS is calculated in continuing operations. The calculation of diluted LPS does not include 78,142,133 73,800,491 |
Revenue Recognition | d. Revenue recognition 1. Revenues from supply agreements The Company recognizes revenues from supply agreements and from selling products when control is transferred to the customer and collectability is probable. 2. Revenues from Chiesi Agreement As Chiesi is obligated to acquire pegunigalsidase alfa from the Company and the development services are not considered distinct, development and manufacturing of a product to be commercialized by Chiesi is viewed as a single performance obligation. Since there is only one performance obligation, all payments received by Chiesi prior to the satisfaction of the Company’s obligation will be deferred. Therefore, the $ 25.0 |
Recently adopted standards | e. Recently adopted standards In May 2014, the Financial Accounting Standards Board (“FASB”) issued guidance on revenues from contracts with customers that will supersede most current revenue recognition guidance, including industry-specific guidance. The underlying principle is to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which an entity expects to be entitled to in exchange for those goods or services. The guidance provides a five-step analysis of transactions to determine when and how revenue is recognized. Other major provisions require capitalization of certain contracts costs, consideration of the time value of money in the transaction price, and allowing estimates of variable consideration to be recognized before contingencies are resolved in certain circumstances. The guidance also requires enhanced disclosures regarding the nature, amount timing and uncertainty of revenues and cash flows arising from an entity’s contracts with customers. The guidance is effective for the interim and annual periods beginning on or after December 15, 2017. On January 1, 2018, the Company adopted the new accounting standard, ASC 606, Revenue from Contracts with Customers, and all the related amendments, using the modified retrospective method. The implementation of this Accounting Standards Update (ASU) did not have a material impact on the Company’s consolidated financial statements. In January 2016, the FASB issued ASU, No. 2016-01, Financial Instruments-Overall: Recognition and Measurement of Financial Assets and Financial Liabilities. The guidance affects the accounting for equity investments, financial liabilities under the fair value option and the presentation and disclosure requirements of financial instruments. The guidance is effective for annual reporting periods beginning after December 15, 2017. The implementation of this ASU did not have a material impact on the Company’s consolidated financial statements. |
INVENTORIES (Tables)
INVENTORIES (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
INVENTORIES [Abstract] | |
Schedule of Inventory | Inventory at March 31, 2018 and December 31, 2017 consisted of the following: March 31, December 31, 2018 2017 (U.S. dollars in thousands) Raw materials $ 3,529 $ 3,838 Work in progress 317 485 Finished goods 3,173 3,510 Total inventory $ 7,019 $ 7,833 |
FAIR VALUE MEASUREMENT (Tables)
FAIR VALUE MEASUREMENT (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
2013 Notes and 2016 Notes [Member] | |
Fair Value Measurements, Recurring and Nonrecurring | The following parameters were used: 2013 Notes 2016 Notes Stock price (USD) 0.5399 0.5399 Expected term (years) 0.46 3.63 Risk free rate 1.88% 2.45% Volatility 62.44% 70.96% Yield 12.89% 12.44% |
REVENUES (Tables)
REVENUES (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS [Abstract] | |
Statements of operations | The following table summarizes the Company’s disaggregation of revenues: March 31, (U.S. dollars in thousands) 2018 2017 Revenues: Pfizer $ 1,980 $ 1,646 Brazil $ 2,573 $ 1,243 $ 4,553 $ 2,889 |
SIGNIFICANT ACCOUNTING POLICI17
SIGNIFICANT ACCOUNTING POLICIES (Narrative) (Details) - USD ($) $ / shares in Units, $ in Millions | 1 Months Ended | 3 Months Ended | |||
Oct. 19, 2017 | Oct. 31, 2015 | Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | |
Significant Accounting Policies [Line Items] | |||||
Common Stock, Par or Stated Value Per Share | $ 0.001 | $ 0.001 | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 73,800,491 | 78,142,133 | |||
Maximum [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Additional AmountPayable For Achievement Of Regulatory And Commercial Milestones | $ 320 | ||||
Brazil [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Percentage Of Adult Gaucher Patients Treated With alfataliglicerase | 10.00% | ||||
Revenue, Net | $ 2.6 | $ 7.1 | |||
Brazil Agreement [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Supply Commitment In Year 2017 | $ 24.3 | ||||
Pfizer Agreement [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Proceeds From Exchange For Rights To Royalties | $ 36 | ||||
Amended Pfizer Agreement [Member] | Protalix Bio Therapeutics Incorporation [Member] | Brazil [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Collaborative Arrangement Revenues and Expenses Sharing Percentage | 100.00% | ||||
Chiesi Agreement [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Future research and development reimbursement | $ 25 | ||||
Upfront Nonrefundable Noncreditable Payment Receivable | 25 | ||||
Additional Amounts Payable To Cover Development Costs | 25 | ||||
Maximum Entitlement Of Development Costs To Cover Per Year | $ 10 | ||||
Chiesi Agreement [Member] | Minimum [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Payment On Net Sales Percentage | 15.00% | ||||
Chiesi Agreement [Member] | Maximum [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Payment On Net Sales Percentage | 35.00% |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Raw materials | $ 3,529 | $ 3,838 |
Work in progress | 317 | 485 |
Finished goods | 3,173 | 3,510 |
Total inventory | $ 7,019 | $ 7,833 |
FAIR VALUE MEASUREMENT (The lia
FAIR VALUE MEASUREMENT (The liability component was valued based on the Income Approach) (Details) - Fair Value, Inputs, Level 3 [Member] | 3 Months Ended |
Mar. 31, 2018$ / shares | |
Four Point Five Percentage Convertible Notes [Member] | |
Stock price (USD) | $ 0.5399 |
Expected term (years) | 5 months 16 days |
Risk free rate | 1.88% |
Volatility | 62.44% |
Yield | 12.89% |
Seven Point Five Percentage Convertible Notes [Member] | |
Stock price (USD) | $ 0.5399 |
Expected term (years) | 3 years 7 months 17 days |
Risk free rate | 2.45% |
Volatility | 70.96% |
Yield | 12.44% |
FAIR VALUE MEASUREMENT (Narrati
FAIR VALUE MEASUREMENT (Narrative) (Details) - Fair Value, Inputs, Level 3 [Member] $ in Millions | Mar. 31, 2018USD ($) |
4.5% Convertible Notes [Member] | |
Convertible Debt, Fair Value Disclosures | $ 5.7 |
4.50% Convertible Notes 2013 [Member] | |
Debt Instrument, Face Amount | 5.9 |
7.50% Convertible Notes 2016 [Member] | |
Convertible Debt, Fair Value Disclosures | 69.3 |
Debt Instrument, Face Amount | $ 58.1 |
CONVERTIBLE NOTES (Narrative) (
CONVERTIBLE NOTES (Narrative) (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Repayments of Convertible Debt | $ 6,726,000 | |
2013 Notes [Member] | ||
Long-term Debt, Gross | $ 5,900,000 | |
Debt Instrument, Term | 5 years | |
2016 Notes [Member] | ||
Debt Conversion, Converted Instrument, Shares Issued | 1,338,707 | |
Repayments of Convertible Debt | $ 11,668 | |
Long-term Debt, Gross | 58,100,000 | |
Debt Conversion, Original Debt, Amount | $ 1,000,000 |
REVENUES (Statements of operati
REVENUES (Statements of operations) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Revenues | $ 4,553 | $ 2,889 |
Pfizer [Member] | ||
Revenues | 1,980 | 1,646 |
Brazil [Member] | ||
Revenues | $ 2,573 | $ 1,243 |