Document And Entity Information
Document And Entity Information | 6 Months Ended |
Jun. 30, 2019 | |
Document Information [Line Items] | |
Entity Registrant Name | Adynxx, Inc. |
Entity Central Index Key | 0001054274 |
Entity Filer Category | Non-accelerated Filer |
Entity Emerging Growth Company | false |
Entity Small Business | true |
Document Type | S-1/A |
Document Period End Date | Jun. 30, 2019 |
Amendment Flag | true |
Amendment Description | AMENDMENT NO. 3 |
Entity Ex Transition Period | false |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Current Period Unaudited) - USD ($) | Jun. 30, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Current assets | |||
Cash and cash equivalents | $ 24,000 | $ 1,887,000 | $ 4,301,000 |
Restricted cash | 254,000 | 55,000 | |
Prepaid expenses and other current assets | 1,622,000 | 10,000 | 34,000 |
Total current assets | 1,900,000 | 1,952,000 | 4,335,000 |
Property and equipment, net | 6,000 | 10,000 | 13,000 |
Restricted cash | 55,000 | ||
Right of use asset, net | 779,000 | ||
Other assets | 18,000 | 18,000 | 18,000 |
Total assets | 2,703,000 | 1,980,000 | 4,421,000 |
Current liabilities | |||
Accounts payable | 1,748,000 | 491,000 | 703,000 |
Accrued liabilities | 1,480,000 | 857,000 | 1,158,000 |
Current portion of operating lease liability | 346,000 | ||
Convertible promissory notes - related party | 5,497,000 | 4,500,000 | |
Current portion of term loan, net of discount | 2,390,000 | 3,812,000 | 1,711,000 |
Total current liabilities | 11,461,000 | 9,660,000 | 3,572,000 |
Term loan, net of current portion and discount | 2,951,000 | ||
Operating lease liability, net of current portion | 493,000 | ||
Warrant liability | 140,000 | 42,000 | |
Commitments and contingencies (Note 7) | |||
Stockholders' deficit | |||
Preferred stock, $0.001 par value; 1,000,000 shares authorized no shares issued or outstanding | |||
Common stock, $0.001 par value; 95,000,000 shares authorized, 5,807,877 shares issued and outstanding at June 30, 2019 (unaudited) 148,000,000 shares authorized, 701,808 shares issued and outstanding at December 31, 2018 | 6,000 | 1,000 | 20,000 |
Additional paid-in capital | 35,160,000 | 747,000 | 419,000 |
Accumulated deficit | (44,417,000) | (37,279,000) | (31,294,000) |
Total stockholders' deficit | (9,251,000) | (36,531,000) | (30,855,000) |
Total liabilities, redeemable convertible preferred stock and stockholders' deficit | 2,703,000 | 1,980,000 | 4,421,000 |
Series A Redeemable Convertible Preferred Stock [Member] | |||
Redeemable convertible preferred stock: | |||
Redeemable convertible preferred stock | 12,814,000 | 12,814,000 | |
Series B Redeemable Convertible Preferred Stock [Member] | |||
Redeemable convertible preferred stock: | |||
Redeemable convertible preferred stock | $ 15,897,000 | $ 15,897,000 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Current Period Unaudited) (Parentheticals) - USD ($) | Jun. 30, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | |
Preferred stock, shares authorized (in shares) | 1,000,000 | 1,000,000 | |
Preferred stock, shares issued (in shares) | 0 | 0 | |
Preferred stock, shares outstanding (in shares) | 0 | 0 | |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 95,000,000 | 5,313,200 | 148,000,000 |
Common stock, shares issued (in shares) | 5,807,877 | 701,808 | 19,548,969 |
Common stock, shares outstanding (in shares) | 5,807,877 | 701,808 | 19,548,969 |
Series A Redeemable Convertible Preferred Stock [Member] | |||
Redeemable convertible preferred stock, par value | $ 0.001 | $ 0.001 | $ 0.001 |
Redeemable convertible preferred stock, shares authorized (in shares) | 0 | 2,046,378 | 57,002,183 |
Redeemable convertible preferred stock, shares issued (in shares) | 0 | 2,034,548 | 56,672,658 |
Redeemable convertible preferred stock, shares outstanding (in shares) | 0 | 2,034,548 | 56,672,658 |
Redeemable convertible preferred stock, liquidation value | $ 12,898,697,000 | $ 12,898,697,000 | |
Series B Redeemable Convertible Preferred Stock [Member] | |||
Redeemable convertible preferred stock, par value | $ 0.001 | $ 0.001 | $ 0.001 |
Redeemable convertible preferred stock, shares authorized (in shares) | 0 | 1,833,387 | 51,069,262 |
Redeemable convertible preferred stock, shares issued (in shares) | 1,833,387 | 51,069,262 | |
Redeemable convertible preferred stock, shares outstanding (in shares) | 0 | 1,833,387 | 51,069,262 |
Redeemable convertible preferred stock, liquidation value | $ 16,000,000,000 | $ 16,000,000,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Operating expenses | ||||
Research and development | $ 3,226 | $ 1,269 | $ 2,137 | $ 8,722 |
General and administrative | 2,317 | 1,292 | 2,982 | 2,341 |
Grant reimbursements | (1,198) | |||
Total operating expenses, net | 4,345 | 2,561 | 5,119 | 11,063 |
Interest expense, net | (992) | (515) | ||
Loss from operations | (4,345) | (2,561) | (5,119) | (11,063) |
Interest expense, net | (2,641) | (445) | (644) | (515) |
Other income (expense), net | (94) | 60 | 126 | 17 |
Loss from continuing operations | (7,080) | (2,946) | ||
Loss from discontinued operations | (58) | |||
Net loss | $ (7,138) | $ (2,946) | $ (5,985) | $ (11,561) |
Net loss per basic and diluted share: | ||||
Loss from continuing operations (in dollars per share) | $ 1.43 | $ (0.64) | ||
Loss from discontinued operations (in dollars per share) | 0.01 | |||
Net loss per basic and diluted share (in dollars per share) | $ 1.44 | $ (0.64) | ||
Weighted-average number of common shares outstanding - basic and diluted (in shares) | 4,966,491 | 4,569,742 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Redeemable Convertible Preferred Stock and Stockholders' Deficit (Unaudited) - USD ($) $ in Thousands | Preferred Stock [Member]Series A Redeemable Convertible Preferred Stock [Member] | Preferred Stock [Member]Series B Redeemable Convertible Preferred Stock [Member] | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | Total |
Balance (in shares) at Dec. 31, 2016 | 56,321,165 | 51,069,262 | 140,362 | |||
Balance at Dec. 31, 2016 | $ 12,734 | $ 15,897 | $ 20 | $ 118 | $ (19,733) | $ (19,595) |
Exercise of warrants (in shares) | 351,493 | |||||
Exercise of warrants | $ 80 | |||||
Stock-based compensation expense | 301 | 301 | ||||
Net loss | (11,561) | (11,561) | ||||
Balance (in shares) at Dec. 31, 2017 | 2,034,548 | 1,833,387 | 701,808 | |||
Balance at Dec. 31, 2017 | $ 12,814 | $ 15,897 | $ 20 | 419 | (31,294) | (30,855) |
Stock-based compensation expense | 75 | 75 | ||||
Net loss | (1,523) | (1,523) | ||||
Balance (in shares) at Mar. 31, 2018 | 2,034,548 | 1,833,387 | 701,808 | |||
Balance at Mar. 31, 2018 | $ 12,814 | $ 15,897 | $ 1 | 513 | (32,817) | (32,303) |
Balance (in shares) at Dec. 31, 2017 | 2,034,548 | 1,833,387 | 701,808 | |||
Balance at Dec. 31, 2017 | $ 12,814 | $ 15,897 | $ 20 | 419 | (31,294) | (30,855) |
Net loss | (2,946) | |||||
Balance (in shares) at Jun. 30, 2018 | 2,034,548 | 1,833,387 | 701,808 | |||
Balance at Jun. 30, 2018 | $ 12,814 | $ 15,897 | $ 1 | 588 | (34,239) | (33,650) |
Balance (in shares) at Dec. 31, 2017 | 2,034,548 | 1,833,387 | 701,808 | |||
Balance at Dec. 31, 2017 | $ 12,814 | $ 15,897 | $ 20 | 419 | (31,294) | (30,855) |
Stock-based compensation expense | 309 | 309 | ||||
Net loss | (5,985) | (5,985) | ||||
Balance (in shares) at Dec. 31, 2018 | 2,034,548 | 1,833,387 | 701,808 | |||
Balance at Dec. 31, 2018 | $ 12,814 | $ 15,897 | $ 20 | 728 | (37,279) | (36,531) |
Balance (in shares) at Mar. 31, 2018 | 2,034,548 | 1,833,387 | 701,808 | |||
Balance at Mar. 31, 2018 | $ 12,814 | $ 15,897 | $ 1 | 513 | (32,817) | (32,303) |
Stock-based compensation expense | 75 | 75 | ||||
Net loss | (1,422) | |||||
Balance (in shares) at Jun. 30, 2018 | 2,034,548 | 1,833,387 | 701,808 | |||
Balance at Jun. 30, 2018 | $ 12,814 | $ 15,897 | $ 1 | 588 | (34,239) | (33,650) |
Balance (in shares) at Dec. 31, 2018 | 2,034,548 | 1,833,387 | 701,808 | |||
Balance at Dec. 31, 2018 | $ 12,814 | $ 15,897 | $ 20 | 728 | (37,279) | (36,531) |
Stock-based compensation expense | 84 | 84 | ||||
Net loss | (2,462) | (2,462) | ||||
Balance (in shares) at Mar. 31, 2019 | 2,034,548 | 1,833,387 | 701,808 | |||
Balance at Mar. 31, 2019 | $ 12,814 | $ 15,897 | $ 1 | 831 | (39,741) | (38,909) |
Balance (in shares) at Dec. 31, 2018 | 2,034,548 | 1,833,387 | 701,808 | |||
Balance at Dec. 31, 2018 | $ 12,814 | $ 15,897 | $ 20 | 728 | (37,279) | (36,531) |
Net loss | (7,138) | |||||
Balance (in shares) at Jun. 30, 2019 | 5,807,877 | |||||
Balance at Jun. 30, 2019 | $ 6 | 35,160 | (44,417) | (9,251) | ||
Balance (in shares) at Mar. 31, 2019 | 2,034,548 | 1,833,387 | 701,808 | |||
Balance at Mar. 31, 2019 | $ 12,814 | $ 15,897 | $ 1 | 831 | (39,741) | (38,909) |
Stock-based compensation expense | 84 | 84 | ||||
Net loss | (4,676) | |||||
Conversion of convertible notes into convertible preferred stock (in shares) | (367,041) | |||||
Conversion of convertible notes into convertible preferred stock | $ 3,203 | |||||
Recognition of beneficial conversion feature upon conversion of convertible notes | $ 2,101 | |||||
Conversion of of convertible preferred stock into common stock (in shares) | (2,034,548) | (2,200,428) | 4,234,976 | |||
Conversion of of convertible preferred stock into common stock | $ (12,814) | $ (21,201) | $ 4 | 34,011 | 34,015 | |
Issuance of common stock for merger (in shares) | 854,017 | |||||
Issuance of common stock for merger | $ 1 | 1 | 2 | |||
Equity issuance costs paid in stock (in shares) | 17,076 | |||||
Equity issuance costs paid in stock | ||||||
Impact of change of warrants subject to fair value measure to equity warrants | 234 | 234 | ||||
Spin-off of AquaMed | (1) | (1) | ||||
Balance (in shares) at Jun. 30, 2019 | 5,807,877 | |||||
Balance at Jun. 30, 2019 | $ 6 | $ 35,160 | $ (44,417) | $ (9,251) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Cash flows from operating activities: | ||||
Net loss | $ (7,138,000) | $ (2,946,000) | $ (5,985,000) | $ (11,561,000) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||||
Depreciation expense | 4,000 | 4,000 | 8,000 | 10,000 |
Stock-based compensation expense | 168,000 | 150,000 | 309,000 | 301,000 |
Changes in fair value of warrant liability | 95,000 | 1,000 | 98,000 | (12,000) |
Changes in fair value of derivative liability | (60,000) | |||
Accretion of final charge upon maturity of Oxford Term Loan A and B | 148,000 | 94,000 | 224,000 | 106,000 |
Amortization of issuance cost and discounts for term loans and convertible notes | 16,000 | 130,000 | 40,000 | 54,000 |
Non-cash interest expense on convertible promissory notes | 2,304,000 | 31,000 | 126,000 | |
Non-cash operating lease cost | 140,000 | |||
Changes in operating assets and liabilities: | ||||
Prepaid expenses and other current assets | (1,611,000) | (12,000) | 23,000 | 329,000 |
Other assets | 57,000 | 1,000 | ||
Accounts payable | 1,255,000 | (607,000) | (212,000) | 601,000 |
Accrued liabilities | 475,000 | (312,000) | (650,000) | (12,000) |
Lease liability | (136,000) | |||
Net cash used in operating activities | (4,223,000) | (3,527,000) | (6,019,000) | (10,183,000) |
Cash flows from investing activities: | ||||
Purchases of property and equipment | (5,000) | (3,000) | ||
Net cash used in investing activities | (5,000) | (3,000) | ||
Cash flows from financing activities: | ||||
Payments on term loan | (1,437,000) | (616,000) | (890,000) | (139,000) |
Proceeds from exercise of warrants | 80,000 | |||
Proceeds from issuance of convertible promissory notes - related party | 3,996,000 | 1,500,000 | 4,500,000 | |
Net cash provided by financing activities | 2,559,000 | 884,000 | 3,610,000 | (59,000) |
Net decrease in cash, cash equivalents and restricted cash | (1,664,000) | (2,643,000) | (2,414,000) | (10,245,000) |
Cash, cash equivalents and restricted cash at beginning of period | 1,942,000 | 4,356,000 | 4,356,000 | 14,601,000 |
Cash, cash equivalents and restricted cash at end of period | 278,000 | 1,713,000 | 1,942,000 | 4,356,000 |
Other supplemental disclosure: | ||||
Cash paid for interest | 173,000 | 190,000 | $ 376,000 | $ 355,000 |
Non-cash investing and financing activities: | ||||
Right-of-use assets obtained in exchange for operating lease obligations(1) | 227,000 | |||
Reclassification of warrant liability to paid in capital | 234,000 | |||
Conversion of convertible preferred stock into common stock | $ 34,015,000 |
Note 1 - Organization and Basis
Note 1 - Organization and Basis of Presentation | 6 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Dec. 31, 2018 | |
Notes to Financial Statements | ||
Organization, Consolidation, Basis of Presentation, Business Description and Accounting Policies [Text Block] | Note 1. The Company On May 3, 2019, ‘Note 3 The Company is a clinical stage biopharmaceutical company focused on the development of a new class of therapeutics called transcription factor decoys and bringing to market novel, disease-modifying products to address unmet needs in the treatment of pain and inflammation. The Company is primarily engaged in developing initial product technology, recruiting personnel, and raising capital. Basis of Presentation These unaudited financial statements represent the condensed consolidated financial statements of Adynxx and, for periods prior to the Merger, the condensed consolidated financial statements of Private Adynxx. The accompanying unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and pursuant to the instructions of the SEC on Form 10 10 X not June 30, 2018 2019 not June 30, 2018 2019 8 June 10, 2019. All share and per share data, for all periods presented, of the issued and outstanding common stock of Adynxx, Inc., have been retroactively restated to reflect the exchange ratio used in the Merger of 0.0359 shares of capital stock in exchange for each share of Private Adynxx, Inc. capital stock outstanding immediately prior to the Merger (which exchange ratio reflects a 1-for-6 reverse stock split of the issued and outstanding capital stock of Alliqua BioMedical, Inc. effected on May 3, 2019 immediately prior to the reverse merger). The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amount of assets, liabilities, revenue, costs, expenses and other (expenses) income that are reported in the condensed consolidated financial statements and accompanying disclosures. These estimates are based on management’s best knowledge of current events, historical experience, actions that the Company may undertake in the future and on various other assumptions that are believed to be reasonable under the circumstances. As a result, actual results may be different from these estimates. Liquidity The accompanying financial statements have been prepared assuming the Company will continue as a going concern. As of June 30, 2019, $24,000 $3.0 $5.6 June 30, 2019, $44.4 not no In April 2019 May 2019, $2.0 $0.5 8% first ‘Note 6 The Company plans to finance its operations and capital funding needs through equity and/or debt financing. However, there can be no one The accompanying financial statements do not | Note 1. Organization and Basis of Presentation The Company Adynxx, Inc. (the “Company”) was incorporated on October 24, 2007, in the state of Delaware. The Company is a clinical-stage pharmaceutical entity that is developing a technology platform to address pain at its molecular roots. The Company is primarily engaged in developing initial product technology, recruiting personnel, and raising capital. Basis of Presentation The accompanying financial statements have been prepared using accounting principles generally accepted in the United States of America (“GAAP”). Liquidity The accompanying financial statements have been prepared assuming the Company will continue as a going concern. As of December 31, 2018, the Company had $1.9 million in cash and cash equivalents, had Oxford term loans, or Term Loans, including accrued interest outstanding of $4.2 million, and convertible promissory notes, or Notes, including accrued interest, outstanding to investors of $4.6 million. From inception through December 31, 2018 the Company had an accumulated deficit of approximately $37.2 million. The Company expects to incur substantial losses in future periods. The Company is subject to risks common to companies in the clinical stage, including, but not limited to, development of new products, development of markets and distribution channels, dependence on key personnel, and the ability to obtain additional capital as needed to fund its product development plans. The Company has a limited operating history and has yet to generate any revenues from customers. There is no guarantee that profitable operations, if ever achieved, could be sustained on a continuing basis. The Company plans to finance its operations and capital funding needs through equity and/or debt financing. However, there can be no assurance that additional funding will be available to the Company on acceptable terms on a timely basis, if at all, or that the Company will generate sufficient cash from operations to adequately fund operating needs or ultimately achieve profitability. The conditions above, among others, raise substantial doubt about the ability of the Company to continue as a going concern within one year after the date of the issuance of the financial statements. The accompanying financial statements do not include any adjustments that might result from the outcome of these uncertainties. |
Note 2 - Summary of Significant
Note 2 - Summary of Significant Accounting Policies | 6 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Dec. 31, 2018 | |
Notes to Financial Statements | ||
Significant Accounting Policies [Text Block] | Note 2. Summary of Significant Accounting Policies Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent liabilities at the date of the financial statements, and the reported amounts of expenses incurred during the reporting period. Actual results could differ from those estimates and such differences could be material to the Company’s financial position and results of operations. Significant estimates and assumptions include the valuation of equity instruments and equity-linked instruments, including the valuation of the Company’s common stock and the valuation of the Company’s common stock options for purposes of accounting for stock-based compensation, and accruals for clinical trials and the valuation allowances on deferred tax assets. Concentration of Credit Risk and Other Risks and Uncertainties Financial instruments that potentially subject the Company to concentration of credit risk consist of cash and cash equivalents. Cash and cash equivalents are deposited in demand and money market accounts with established financial institutions and, at times, such balances with any one financial institution may be in excess of the Federal Deposit Insurance Corporation insured limits. To date, the Company has not experienced any losses on its deposits of cash and cash equivalents. The Company operates in a dynamic and highly competitive industry and believes that changes in any of the following areas could have a material adverse effect on the Company’s future financial position, results of operations, or cash flows: ability to obtain future financing; advances and trends in new technologies and industry standards; results of clinical trials; regulatory approval and market acceptance of the Company’s products; development of sales channels; certain strategic relationships; litigation or claims against the Company based on intellectual property, patent, product, regulatory, or other factors; and the Company’s ability to attract and retain employees necessary to support its growth. The Company’s postoperative pain reduction product candidate, brivoligide, is an oligonucleotide. The Company currently uses Nitto-Denko Avecia, Inc. (“Avecia”) as a single supplier for the brivoligide drug substance. There are currently a limited number of oligonucleotide manufacturers with commercial scale capabilities globally. While the Company intends to develop secondary sources for manufacturing of its drug candidates in the future, there can be no assurance that it will be able to do so on commercially reasonable terms, or at all. Any interruption in the supply of this key material could significantly delay the research and development process or increase the expenses for development and commercialization of the Company’s product candidates. The quality of materials can be critical to the performance of a drug delivery technology. Therefore, the lack of a reliable source that provides a consistent supply of high quality materials would harm the Company. At June 30, 2019, this vendor’s activity was not material to total accounts payable. At December 31, 2018, three vendors represented 52%, 26% and 15% of total accounts payable. Two of these vendors supported general and administrative activities, primarily associated with the Merger and next round of equity financing, which accounted for 67% of the total accounts payable. The remaining vendor supported clinical study activities. At June 30, 2019, three vendors represented 26%, 22% and 17% of total accounts payable, respectively. Two of these vendors supported general and administrative activities associated with the Merger and the next round of equity financing, which accounted for 44% of the total accounts payable. The remaining supported clinical study activities. Clinical Trial Accruals The Company’s clinical trial accruals are based on patient enrollment and related costs at clinical investigator sites as well as for the services received and efforts expended pursuant to contracts with multiple research institutions and contract research organizations that conduct and manage clinical trials on the Company’s behalf. The Company accrues expenses related to clinical trials based on contracted amounts applied to the level of patient enrollment and activity according to the clinical trial protocol. If timelines or contracts are modified based upon changes in the clinical trial protocol or scope of work to be performed, the Company modifies the estimates of accrued expenses accordingly. To date, the Company has had no significant adjustments to accrued clinical trial expenses. Cash and Cash Equivalents The Company considers all highly liquid investments purchased with a maturity of three months or less on the date of acquisition to be cash and cash equivalents. Property and Equipment, Net Property and equipment are stated at cost, net of accumulated depreciation. Depreciation is computed using a straight-line method over the estimated useful lives of the assets, generally three to five years. Leasehold improvements are amortized over the shorter of the estimated useful life of the asset or the remaining term of the lease. Expenditures for repairs and maintenance are charged to expense as incurred. Upon disposition of an asset, the cost and related accumulated depreciation are removed from the accounts and the resulting gain or loss is reflected in the statements of operations. Impairment of Long-Lived Assets The Company’s long-lived assets and other assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. Recoverability of an asset to be held and used is measured by a comparison of the carrying amount of an asset to the future undiscounted cash flows expected to be generated by the asset. If such asset is considered to be impaired, the impairment to be recognized is measured as the amount by which the carrying amount of the asset exceeds its fair value. As of December 31, 2018 and June 30, 2019, the Company had not experienced any impairment losses on its long-lived assets. Restricted Cash At December 31, 2018 and June 30, 2019, the Company had $55,000 restricted and held by a bank as collateral for a letter of credit provided to the Company’s facility landlord. In addition, as of June 30, 2019, the Company had $200,000 restricted from withdrawal and held by a bank in the form of a secured money market account as collateral for Oxford in conjunction with a debt amendment that occurred in January 2019. Stock-Based Compensation Stock-based compensation is measured at the grant date based on the fair value of the award. The fair value of the award that is ultimately expected to vest is recognized as expense on a straight-line basis over the requisite service period, which is generally the vesting period. The Company recognizes forfeitures as they occur. The Company uses the Black-Scholes option-pricing model (the “Black-Scholes model”) as the method for determining the estimated fair value of stock options. Expected Term — The expected term represents the period that the Company’s stock-based awards are expected to be outstanding and is determined using the simplified method. Expected Volatility — Expected volatility is estimated using comparable public companies’ volatility for similar terms. Expected Dividend — The Black-Scholes model calls for a single expected dividend yield as an input. Other than the dividend paid in connection with the Merger, the Company has never paid dividends and has no plans to pay dividends. Risk-Free Interest Rate — The risk-free interest rate used in the Black-Scholes model is based on the U.S. Treasury zero-coupon issues in effect at the time of grant for periods corresponding with the expected term of the option. Research and Development Research and development expenses consist of personnel costs, including salaries, benefits and stock-based compensation, preclinical studies, clinical studies performed by contract research organizations (“CROs”), materials and supplies, licenses and fees, and overhead allocations consisting of various administrative and facilities related costs. The Company charges research and development costs, including clinical study costs, to expense when incurred. Collaboration Agreement In June 2018, the Company entered into a collaboration agreement with twoXAR, an artificial intelligence-driven drug discovery company, in order to identify potential product candidates for the treatment of endometriosis. In May 2019, the Company made a collaboration initiation payment of $75,000, which was charged to research and development expenses for the six months ended June 30, 2019. In June 2019, Adynxx received an initial set of candidate predictions from twoXAR. The Company has initiated a review of the potential products to determine if any are viable candidates for further research and development. Grant Reimbursements In December 2018, the Company received a Notice of Award from the National Institute on Drug Abuse (“NIDA”), part of the National Institutes of Health (“NIH”), to support the clinical development of its lead product candidate, brivoligide. NIH grants provide funds for certain types of expenditures in connection with research and development activities over a contractually defined period. The maximum funding expected to be available under this grant for qualified expenditures over the two-year period through December 2020 is approximately $5.7 million. On January 1, 2019, the Company adopted Accounting Standards Update (ASU) 2018-08, “Clarifying the Scope and the Accounting Guidance for Contributions Received and Contributions Made.” Based on this guidance, the Company determined that grant payments received met the definition of a ‘conditional contribution’ (versus an exchange contract) because (i) the Company has limited discretion in the way the funds may be spent, which creates a barrier to entitlement, and (ii) the grant contains provisions that release the awarding agency from the obligation to transfer funds that are not expended at the time the award is terminated. The Company recognizes grant reimbursements as a contra operating expense and reflects this as a component of its loss from operations in the period during which the qualifying expenses are incurred and the related services rendered, provided that the applicable performance obligations have been met. For the six months ended June 30, 2019, the Company incurred qualified expenses and recognized $1,198,000 of grant reimbursements. Income Taxes The Company accounts for income taxes using the asset and liability method whereby deferred tax asset and liability account balances are determined based on differences between the financial reporting and tax basis of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company provides a valuation allowance, if necessary, to reduce deferred tax assets to their estimated realizable value. In evaluating the ability to recover its deferred income tax assets, the Company considers all available positive and negative evidence, including its operating results, ongoing tax planning, and forecasts of future taxable income on a jurisdiction-by-jurisdiction basis. In the event the Company determines that it would be able to realize its deferred income tax assets in the future in excess of their net recorded amount, it would make an adjustment to the valuation allowance, which would reduce the provision for income taxes. Conversely, in the event that all or part of the net deferred tax assets are determined not to be realizable in the future, an adjustment to the valuation allowance would be charged to earnings in the period such determination is made. The Company recognizes the tax benefit from uncertain tax positions in accordance with GAAP, which prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of uncertain tax positions taken or expected to be taken in a company’s tax return. Convertible Preferred Stock Warrants At December 31, 2018, freestanding warrants to acquire shares of convertible preferred stock were classified as liabilities on the accompanying balance sheet. These warrants were subject to remeasurement at fair value at each balance sheet date, and any change in fair value is recognized as a component of other income or expense. In connection with the Merger, the warrants were exchanged into warrants that no longer met the definition of a derivative and thus, $234,000 of warrant liabilities was reclassified into equity during the six months ended June 30, 2019. Debt Modifications and Extinguishments When the Company modifies debt, it does so in accordance with Accounting Standards Codification (“ASC”) 470-50, Debt: Modifications and Extinguishments , which requires modification to debt instruments to be evaluated to assess whether the modifications are considered “substantial modifications”. A substantial modification of terms shall be accounted for like an extinguishment. Based on the guidance relied upon and the analysis performed, the Company determined that the October 2018 modification of the March 2018 and September 2018 Notes, to add an additional conversion option in the event of a reverse merger, was considered to be a “substantial modification”. As a result, it treated this modification as an ‘extinguishment’ of those debts and recognized $11,000 of net gain from this debt extinguishment in other income in October 2018. All other changes to debt provisions were not considered substantial and were treated as debt modifications. Derivative Instruments ASC 815-15, Derivatives and Hedging: Embedded Derivatives , generally provides three criteria that, if met, require companies to bifurcate conversion options from their host instruments and account for them as freestanding derivative financial instruments. These three criteria include circumstances in which (a) the economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics and risks of the host contract, (b) the hybrid instrument that embodies both the embedded derivative instrument and the host contract is not re-measured at fair value under otherwise applicable generally accepted accounting principles with changes in fair value reported in earnings as they occur and (c) a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument subject to the requirement of ASC 815. At December 31, 2018 and June 30, 2019, the Company maintained outstanding Notes which contained various embedded derivative features. In particular, these Notes contained the following features: (1) A share settled redemption in a qualified preferred stock financing; and (2) The right to an accelerated cash repayment in the event of a change in control. These embedded features were not considered clearly and closely related to the debt host, therefore, they were bifurcated and accounted for separately from the debt host as a derivative liability. Derivative financial liabilities are initially recorded at fair value, with gains and losses arising from changes in fair value recognized in the statement of operations at each period end while such instruments are outstanding. As of December 31, 2018 and June 30, 2019, the Company determined that there was no fair value associated with the embedded derivatives that remained with the outstanding convertible notes. See ‘Note 6 — Term Loans and Convertible Promissory Notes’ for further discussion of the Notes and the bifurcated derivative liability. Fair Value of Financial Instruments ASC 820-10, Fair Value Measurement , provides a framework for measuring fair value under GAAP and requires expanded disclosures regarding fair value measurements. The standard defines fair value as an exit price, representing the amount that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants. The standard also establishes a fair value hierarchy, which prioritizes the inputs used in measuring fair value. The standard describes three levels of inputs that may be used to measure fair value: Level 1 — Unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access as of the measurement date. Level 2 — Inputs other than quoted prices included within Level 1 that are directly observable for the asset or liability or indirectly observable through corroboration with observable market data. Level 3 — Unobservable inputs for the asset or liability only used when there is little, if any, market activity for the asset or liability at the measurement date. This hierarchy requires the use of observable market data when available and to minimize the use of unobservable inputs when determining fair value. The following table presents the Company’s fair value hierarchy for its warrant liability measured at fair value on a recurring basis at December 31, 2018 (in thousands): As of December 31, 2018 Level 1 Level 2 Level 3 Total Financial liabilities Warrant liability $ — $ — $ $ Total financial liabilities $ — $ — $ $ The Level 3 derivative at December 31, 2018 consisted of a warrant liability of Private Adynxx that, at December 31, 2018, was exercisable into preferred shares that were potentially redeemable. In connection with the Merger, the warrants were exchanged into warrants that no longer met the definition of a derivative and thus, the balance was reclassified into equity during the six months ended June 30, 2019. The change in fair value of the warrant liability for the six months ended June 30, 2018 and 2019 are as follows (in thousands): Six Months Ended June 30, 2018 2019 Fair value, beginning of period $ $ Change in fair value of preferred stock warrants — Exchange of warrants upon Merger — ) Fair value at end of period $ $ — The carrying amounts reported in the accompanying balance sheets for cash and cash equivalents, accounts payable and accrued liabilities approximate their fair value due to their short maturities. The fair value of the Company’s term loan is based on the borrowing rate currently available to the Company for borrowings with similar terms and maturity and approximates its carrying value. Derivative liability instruments are considered Level 3 when their fair values are determined using pricing models, discounted cash flow methodologies, or similar techniques, and at least one significant model assumption or input is unobservable. Level 3 liability instruments consist of the preferred stock warrant liability and derivative liability, for both of which there is no observable market data for the determination of fair value and requires significant management judgment and estimation. While the Company’s Notes contain embedded derivative liabilities, the Company determined that the fair value of these liabilities were zero at December 31, 2018 and June 30, 2019. See ‘ Note 6 — Term Loans and Convertible Promissory Notes’ for further discussion on the derivative liability activity. The change in fair value of the derivative liability relating to the Notes for the six months ended June 30, 2018 and 2019 is summarized below (in thousands): Six Months Ended June 30, 2018 2019 Fair value, beginning of period $ — $ — Embedded derivative liability from the issuance of Notes — Change in value of embedded derivatives ) — Fair value at end of period $ $ — Discontinued Operations Discontinued operations represent the activities of the AquaMed business between the date of the Merger and the date of the spin-off. See ‘ Note 3 — Reverse Merger’ . There are no ongoing activities or obligations associated with discontinued operations at June 30, 2019. Recently Adopted Accounting Pronouncements Lease Accounting In February 2016, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2016-02, Leases (Topic 842) (“ASU 2016-02”). ASU 2016-02 is intended to improve financial reporting of leasing transactions by requiring organizations that lease assets to recognize assets and liabilities for the rights and obligations created by leases that extend more than twelve months on the balance sheet. This accounting update also requires additional disclosures surrounding the amount, timing, and uncertainty of cash flows arising from leases. ASU 2016-02 is effective for financial statements issued for annual and interim periods beginning after December 15, 2018 for public business entities. A modified retrospective transition approach is required, applying the new standard to all leases existing at the date of initial application. An entity may choose to use either (1) its effective date or (2) the beginning of the earliest comparative period presented in the financial statements as its date of initial application. The Company adopted the new standard on January 1, 2019 and used the effective date as its date of initial application. Consequently, the Company has not adjusted prior period amounts. The Company has elected the package of practical expedients permitted in ASC Topic 842. Accordingly, the Company accounted for its existing operating leases as operating leases under the new guidance, without reassessing (a) whether the contracts contain a lease under ASC Topic 842, (b) whether classification of the operating leases would be different in accordance with ASC Topic 842, or (c) whether the unamortized initial direct costs would have met the definition of initial direct costs in ASC Topic 842 at lease commencement. The most significant impact from the adoption of this standard was the recognition of right-of-use, or ROU, assets and lease obligations on the balance sheet for operating leases. This standard did not have a material impact on the Company’s cash flows from operations and operating results. As a result of the adoption of the new lease accounting guidance, the Company recognized on January 1, 2019 (a) a lease liability of approximately $227,000, which represents the present value of the remaining lease payments of approximately $239,000, discounted using the Company’s incremental borrowing rate of 9.41%, and (b) a right-of-use asset of approximately $227,000 which represents the lease liability of $227,000. The ROU asset is being amortized over the remaining term of the lease of twelve months from January 1, 2019. Recent Accounting Pronouncements Not Yet Effective In August 2018, the FASB issued No. ASU 2018-13, Changes to the Disclosure Requirements for Fair Value Measurement (Topic 820). This ASU eliminates, adds and modifies certain disclosure requirements for fair value measurements as part of its disclosure framework project. This ASU is effective for fiscal years beginning after December 15, 2019, including interim periods within that fiscal year, with early adoption permitted. The Company is currently assessing whether these amendments will have a material effect on its financial statements. In August 2018, the FASB issued ASU 2018-15, Intangibles — Goodwill and Other — Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract, (“ASU 2018-15”). The amendments in this update align the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license). The accounting for the service element of a hosting arrangement that is a service contract is not affected by the amendments in this update. The new standard will be effective beginning January 1, 2020 and early adoption is permitted. The Company is currently assessing whether these amendments will have a material effect on its financial statements. | Note 2. Summary of Significant Accounting Policies Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent liabilities at the date of the financial statements, and the reported amounts of expenses incurred during the reporting period. Actual results could differ from those estimates and such differences could be material to the Company’s financial position and results of operations. Significant estimates and assumptions include the valuation of equity instruments and equity-linked instruments, including the valuation of the Company’s common stock and the valuation of the Company’s common stock options for purposes of accounting for stock-based compensation, and accruals for clinical trials and the valuation allowances on deferred tax assets. Concentration of Credit Risk and Other Risks and Uncertainties Financial instruments that potentially subject the Company to concentration of credit risk consist of cash and cash equivalents. Cash and cash equivalents are deposited in demand and money market accounts with established financial institutions and, at times, such balances with any one financial institution may be in excess of the Federal Deposit Insurance Corporation insured limits. To date, the Company has not experienced any losses on its deposits of cash and cash equivalents. The Company operates in a dynamic and highly competitive industry and believes that changes in any of the following areas could have a material adverse effect on the Company’s future financial position, results of operations, or cash flows: ability to obtain future financing; advances and trends in new technologies and industry standards; results of clinical trials; regulatory approval and market acceptance of the Company’s products; development of sales channels; certain strategic relationships; litigation or claims against the Company based on intellectual property, patent, product, regulatory, or other factors; and the Company’s ability to attract and retain employees necessary to support its growth. The Company’s postoperative pain reduction product candidate, brivoligide, is an oligonucleotide. The Company currently uses Avecia as a single supplier for the brivoligide drug substance. There are currently a limited number of oligonucleotide manufacturers with commercial scale capabilities globally. While the Company intends to develop secondary sources for manufacturing of its drug candidates in the future, there can be no assurance that it will be able to do so on commercially reasonable terms, or at all. Any interruption in the supply of this key material could significantly delay the research and development process or increase the expenses for development and commercialization of the Company’s product candidates. The quality of materials can be critical to the performance of a drug delivery technology. Therefore, the lack of a reliable source that provides a consistent supply of high quality materials would harm the Company. At December 31, 2018, this vendor’s activity was not material to total accounts payable. At December 31, 2017, two vendors represented 56% and 31%, of total accounts payable. The vendor that represented 56% of the Company’s accounts payable, supported manufacturing activities and the other vendor was associated with clinical study activities. At December 31, 2018, three vendors represented 52%, 26% and 15% of total accounts payable. Two of these vendors supported general and administrative activities, primarily associated with the Merger and next round of equity financing, which accounted for 67% of the total accounts payable. The remaining vendor supported clinical study activities. Clinical Trial Accruals The Company’s clinical trial accruals are based on patient enrollment and related costs at clinical investigator sites as well as for the services received and efforts expended pursuant to contracts with multiple research institutions and contract research organizations that conduct and manage clinical trials on the Company’s behalf. The Company accrues expenses related to clinical trials based on contracted amounts applied to the level of patient enrollment and activity according to the clinical trial protocol. If timelines or contracts are modified based upon changes in the clinical trial protocol or scope of work to be performed, the Company modifies the estimates of accrued expenses accordingly. To date, the Company has had no significant adjustments to accrued clinical trial expenses. In March 2018, the Company closed its contracts with Premier Research International LLC and CRF Health, Inc. (“Contract Research Organizations or CROs”) upon completion of a Phase 2 clinical trial in March 2018. For the years ended December 31, 2017 and 2018, the Company incurred $6.2 million and $95,000, respectively, of expenses in connection with this clinical study. In November 2018, the Company entered into agreements with PRA Health, Inc. and CRF Health, Inc. (“Contract Research Organizations or CROs”) pursuant to which the CROs agreed to assist the Company with the conduct of a Phase 2 clinical trial. To support additional clinical trial activities the Company also entered into agreements with Premier Research International LLC for biostatistical services, ICON Central Laboratories for laboratory services and Almac Clinical Services for storage and distribution services. In connection with this clinical study, the Company incurred expenses of $0 and $185,000 for the years ended December 31, 2017 and 2018, respectively. Cash and Cash Equivalents The Company considers all highly liquid investments purchased with a maturity of three months or less on the date of acquisition to be cash and cash equivalents. Property and Equipment, Net Property and equipment are stated at cost, net of accumulated depreciation. Depreciation is computed using a straight-line method over the estimated useful lives of the assets, generally three to five years. Leasehold improvements are amortized over the shorter of the estimated useful life of the asset or the remaining term of the lease. Expenditures for repairs and maintenance are charged to expense as incurred. Upon disposition of an asset, the cost and related accumulated depreciation are removed from the accounts and the resulting gain or loss is reflected in the statements of operations. Impairment of Long-Lived Assets The Company’s long-lived assets and other assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. Recoverability of an asset to be held and used is measured by a comparison of the carrying amount of an asset to the future undiscounted cash flows expected to be generated by the asset. If such asset is considered to be impaired, the impairment to be recognized is measured as the amount by which the carrying amount of the asset exceeds its fair value. As of December 31, 2017 and 2018, the Company had not experienced any impairment losses on its long-lived assets. Restricted Cash As of December 31, 2017 and 2018, the Company had $55,000 restricted and held by a bank as collateral for a letter of credit provided to the Company’s facility landlord. Stock-Based Compensation Stock-based compensation is measured at the grant date based on the fair value of the award. The fair value of the award that is ultimately expected to vest is recognized as expense on a straight-line basis over the requisite service period, which is generally the vesting period. The Company recognizes forfeitures as they occur. The Company uses the Black-Scholes option-pricing model (the “Black-Scholes model”) as the method for determining the estimated fair value of stock options. Expected Term — The expected term represents the period that the Company’s stock-based awards are expected to be outstanding and is determined using the simplified method. Expected Volatility — Expected volatility is estimated using comparable public companies’ volatility for similar terms. Expected Dividend — The Black-Scholes model calls for a single expected dividend yield as an input. The Company has never paid dividends and has no plans to pay dividends. Risk-Free Interest Rate — The risk-free interest rate used in the Black-Scholes model is based on the U.S. Treasury zero-coupon issues in effect at the time of grant for periods corresponding with the expected term of the option. Research and Development Research and development expenses consist of personnel costs, including salaries, benefits and stock-based compensation, preclinical studies, clinical studies performed by Contract Research Organizations (or “CROs”), materials and supplies, licenses and fees, and overhead allocations consisting of various administrative and facilities related costs. The Company charges research and development costs, including clinical study costs, to expense when incurred. Collaboration Agreement In June 2018, the Company entered into a collaboration agreement with twoXAR, an artificial intelligence-driven drug discovery company, in order to identify potential product candidates for the treatment of endometriosis. Through December 31, 2018, the Company was not obligated to make any payments under the terms of the collaboration agreement. Grant Reimbursements In December 2018, the Company received a Notice of Award from the National Institute on Drug Abuse (“NIDA”), part of the National Institutes of Health (“NIH”), to support the clinical development of its lead product candidate, brivoligide. NIH grants provide funds for certain types of expenditures in connection with research and development activities over a contractually defined period. The maximum funding expected to be available under this grant for qualified expenditures over the two year period through December 2020 is approximately $5.7 million. As of December 31, 2018, the Company had not incurred qualified expenses. Income Taxes The Company accounts for income taxes using the asset and liability method whereby deferred tax asset and liability account balances are determined based on differences between the financial reporting and tax basis of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company provides a valuation allowance, if necessary, to reduce deferred tax assets to their estimated realizable value. In evaluating the ability to recover its deferred income tax assets, the Company considers all available positive and negative evidence, including its operating results, ongoing tax planning, and forecasts of future taxable income on a jurisdiction-by-jurisdiction basis. In the event the Company determines that it would be able to realize its deferred income tax assets in the future in excess of their net recorded amount, it would make an adjustment to the valuation allowance, which would reduce the provision for income taxes. Conversely, in the event that all or part of the net deferred tax assets are determined not to be realizable in the future, an adjustment to the valuation allowance would be charged to earnings in the period such determination is made. The Company recognizes the tax benefit from uncertain tax positions in accordance with GAAP, which prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of uncertain tax positions taken or expected to be taken in a company’s tax return. Convertible Preferred Stock Warrants Freestanding warrants to acquire shares of convertible preferred stock are classified as liabilities on the accompanying balance sheets. These warrants are subject to remeasurement at fair value at each balance sheet date, and any change in fair value is recognized as a component of other income or expense. The Company will continue to adjust the carrying values of freestanding warrants classified as liabilities for changes in fair value until the earlier of the exercise or expiration of the warrants or the completion of a liquidation event, including the completion of an initial public offering. Debt Modif ications and Extinguishments When the Company modifies debt, it does so in accordance with Accounting Standards Codification (“ASC”) 470-50, Debt: Modifications and Extinguishments , which requires modification to debt instruments to be evaluated to assess whether the modifications are considered “substantial modifications”. A substantial modification of terms shall be accounted for like an extinguishment. Based on the guidance relied upon and the analysis performed, the Company determined that the October 2018 modification of the March 2018 and September 2018 Notes, to add an additional conversion option in the event of a reverse merger, was considered to be a “substantial modification”. As a result, it treated this modification as an ‘extinguishment’ of those debts and recognized $11,000 of net gain from this debt extinguishment in other income. All other changes to debt provisions were not considered substantial and were treated as debt modifications. Derivative Instruments ASC 815-15, Derivatives and Hedging: Embedded Derivatives , generally provides three criteria that, if met, require companies to bifurcate conversion options from their host instruments and account for them as freestanding derivative financial instruments. These three criteria include circumstances in which (a) the economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics and risks of the host contract, (b) the hybrid instrument that embodies both the embedded derivative instrument and the host contract is not re-measured at fair value under otherwise applicable generally accepted accounting principles with changes in fair value reported in earnings as they occur and (c) a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument subject to the requirement of ASC 815. The Company issued certain Notes in March 2018, September 2018, and December 2018, which contained various embedded derivative features. In particular, these Notes contained the following features: (1) (2) These embedded features were not considered clearly and closely related to the debt host, therefore, they were bifurcated and accounted for separately from the debt host as a derivative liability. Derivative financial liabilities are initially recorded at fair value, with gains and losses arising from changes in fair value recognized in the statement of operations at each period end while such instruments are outstanding. In October 2018, the Company modified the March 2018 and September 2018 Notes to add an additional conversion feature. The Company determined this was a “substantial modification” as defined in ASC 470-50 ‘Debt: Modifications and Extinguishments’ . As a result, these Notes were accounted for as an ‘extinguishment’ of the debt and related derivative liability. As of December 31, 2018, the Company determined that there was no fair value associated with the embedded derivatives that remained with the modified March 2018, the modified September 2018 and December 2018 Notes. See ‘Note 5 — Term Loans and Convertible Promissory Notes’ for further discussion of the Notes and the bifurcated derivative liability. Fair Value of Financial Instruments ASC 820-10, Fair Value Measurement , provides a framework for measuring fair value under GAAP and requires expanded disclosures regarding fair value measurements. The standard defines fair value as an exit price, representing the amount that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants. The standard also establishes a fair value hierarchy, which prioritizes the inputs used in measuring fair value. The standard describes three levels of inputs that may be used to measure fair value: Level 1 — Unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access as of the measurement date. Level 2 — Inputs other than quoted prices included within Level 1 that are directly observable for the asset or liability or indirectly observable through corroboration with observable market data. Level 3 — Unobservable inputs for the asset or liability only used when there is little, if any, market activity for the asset or liability at the measurement date. This hierarchy requires the use of observable market data when available and to minimize the use of unobservable inputs when determining fair value. The following tables present the Company’s fair value hierarchy for all of its financial instruments measured at fair value on a recurring basis as of December 31, 2017 and December 31, 2018 (in thousands): As of December 31, 2017 Level 1 Level 2 Level 3 Total Financial liabilities: Warrant liability $ — $ — $ 42 $ 42 Total financial liabilities $ — $ — $ 42 $ 42 As of December 31, 2018 Financial liabilities: Level 1 Level 2 Level 3 Total Warrant liability $ — $ — $ 140 $ 140 Total financial liabilities $ — $ — $ 140 $ 140 The carrying amounts reported in the accompanying balance sheets for cash and cash equivalents, accounts payable and accrued liabilities approximate their fair value due to their short maturities. The fair value of the Company’s term loan is based on the borrowing rate currently available to the Company for borrowings with similar terms and maturity and approximates its carrying value. Derivative liability instruments are considered Level 3 when their fair values are determined using pricing models, discounted cash flow methodologies, or similar techniques, and at least one significant model assumption or input is unobservable. Level 3 liability instruments consist of the preferred stock warrant liability and derivative liability, for both of which there is no observable market data for the determination of fair value and requires significant management judgment and estimation. The fair value of the warrant liability was determined using the Black-Scholes model (see ‘Note 8 — Warrants’ for a further discussion of the preferred stock warrants). The change in fair value of the preferred stock warrant liability is summarized below (in thousands): Years Ended December 31, 2017 2018 Fair value, beginning of period $ 54 $ 42 Preferred stock warrants – exercised (8) — Change in fair value of preferred stock warrants (4) 98 Fair value at end of period $ 42 $ 140 The fair value of the embedded derivative liability related to the Company’s Notes was determined using a bond plus option model. As of December 31, 2018, the Company determined that there was no fair value remaining for the embedded derivatives associated with the modified March 2018, modified September 2018 and December 2018 Notes. See ‘Note 5 — Term Loans and Convertible Promissory Notes’ for further discussion on the derivative liability activity. The change in fair value of the derivative liability relating to the Notes is summarized below (in thousands): Years Ended December 31, 2017 2018 Fair value, beginning of period $ — $ — Embedded derivative liability from the issuance of Notes — 864 Change in value of embedded derivatives — (211) Termination of the embedded derivative liability due to the extinguishment of the related Notes — (653) Fair value at end of period $ — $ — Recently Adopted Accounting Pronouncements Restricted Cash In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows: Restricted Cash. This ASU requires changes in restricted cash during the period to be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. If cash, cash equivalents and restricted cash are presented in more than one line item on the balance sheet, the new guidance requires a reconciliation of the total in the statement of cash flows to the related captions in the balance sheet. This guidance is effective for fiscal periods beginning after December 15, 2017 and interim periods within that fiscal year, with early adoption permitted. The amendments in this ASU should be applied retrospectively to all periods presented. The Company adopted the guidance on a retrospective basis on January 1, 2018 and the beginning and ending of cash and cash equivalents for all periods presented in our statements of cash flows include restricted cash. Non-employee Share-Based Payment Accounting In June 2018, FASB issued ASU No. 2018-07, “Compensation — Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting” (“ASU 2018-07”). This new guidance changes the accounting for non-employee share-based payments to align with the accounting for employee stock compensation. The Company early adopted the guidance as of January 1, 2018 and the impact to its financial statements was not material. Recent Accounting Pronouncements Not Yet Effective Lease Accounting In February 2016, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2016-02. This standard introduces the new leases standard that applies a right-of-use (“ROU”) model and requires a lessee to record, for all leases with a lease term of more than 12 months, an asset representing its right to use the underlying asset and a liability to make lease payments. For leases with a term of 12 months or less, a practical expedient is available whereby a lessee may elect, by class of underlying asset, not to recognize an ROU asset or lease liability. At inception, lessees must classify all leases as either finance or operating based on five criteria. Balance sheet recognition of finance and operating leases is similar, but the pattern of expense recognition in the income statement, as well as the effect on the statement of cash flows, differs depending on the lease classification. This ASU is effective for public entities for annual periods beginning after December 15, 2018, and interim periods within those years. Early adoption is permitted for all entities. The Company is currently assessing whether these amendments will have a material effect on its financial statements. In August 2018, the FASB issued No. ASU 2018-13, Changes to the Disclosure Requirements for Fair Value Measurement (Topic 820). This ASU eliminates, adds and modifies certain disclosure requirements for fair value measurements as part of its disclosure framework project. This ASU is effective for fiscal years beginning after December 15, 2019, including interim periods within that fiscal year, with early adoption permitted. The Company is currently assessing whether these amendments will have a material effect on its financial statements. |
Note 3 - Reverse Merger
Note 3 - Reverse Merger | 6 Months Ended |
Jun. 30, 2019 | |
Notes to Financial Statements | |
Reverse Merger Disclosure [Text Block] | Note 3. Reverse Merger Merger On May 3, 2019 the Company completed its reverse merger with Alliqua BioMedical Inc. (“Alliqua”). Immediately following the Merger, the combined company’s name was changed from “Alliqua BioMedical, Inc.” to “Adynxx, Inc.” Private Adynxx changed its name to “Adynxx Sub, Inc.” and is currently a wholly owned subsidiary of the Company. The Merger is intended to qualify for federal income tax purposes as a tax-free reorganization under the provisions of Section 368(a) of the Internal Revenue Code of 1986, as amended. Subject to the terms and conditions of the Agreement and Plan of Merger and Reorganization, dated as of October 11, 2018, as amended and supplemented from time to time (the “Merger Agreement”), (a) each outstanding share of capital stock of Private Adynxx, was converted into the right to receive the number of shares of Alliqua’s common stock equal to the exchange ratio formula in the Merger Agreement (“Exchange Ratio”) of 0.0359 shares of common stock (which exchange rate reflects a 1-for-6 reverse stock split of the issued and outstanding capital stock of Alliqua BioMedical, Inc. effected on May 3, 2019 immediately prior to the Merger) and (b) each outstanding Private Adynxx stock option, whether vested or unvested, and warrant that has not previously been exercised, was assumed by the post-Merger company and converted into a stock option or warrant, as the case may be, to purchase shares of the post-Merger Adynxx Company’s common stock at the Exchange Ratio formula in the Merger Agreement. On May 3, 2019, prior to the closing of the Merger, $3.0 million aggregate principal amount of Notes and $203,000 of cumulative accrued interest on such Notes were converted into 367,041 shares of common stock. Upon the completion of the Merger, Private Adynxx equity holders held 4,936,784 shares of common stock. Equity issuance costs in connection with the Merger were recorded as an offset to additional paid in capital. As described in “Spin-off” below, at the time of the Merger, Alliqua had in place a plan to spin-off all existing operations. Since Alliqua was deemed to have no operations upon consummation of the Spin-off, Alliqua was not considered to be a business for accounting purposes. Accordingly, no goodwill or intangible assets were recorded as a result of the Merger. Because Private Adynxx is treated as the acquiring company, Private Adynxx’s assets and liabilities are recorded at their pre-combination carrying amounts and the historical operations that are reflected in periods prior to the closing date of the Merger will be those of Private Adynxx. All share and per share amounts have been retroactively restated to give effect to the Exchange Ratio. Private Adynxx was determined to be the accounting acquirer based upon the terms of the Merger Agreement and other factors including: (i) Private Adynxx equity holders owned approximately 86% of the voting interests of the combined company immediately following the closing of the transaction and Alliqua equity holders owned approximately 14%; (ii) directors appointed by Private Adynxx hold a majority of board seats in the combined company; and (iii) Private Adynxx management hold all key positions in the management of the combined company. In connection with a previous modification of its Notes, the Company had computed a contingent beneficial conversion feature (“BCF”) that was contingent upon the occurrence of a reverse merger. In accordance with ASC 470-20-25-6, the contingent BCF is not recognized in earnings until the contingency is resolved. Upon the date of the Merger, the full amount of beneficial conversion feature of $2.1 million was recognized as interest expense in the condensed consolidated statement of operations for the six months ended June 30, 2019. Dividend In contemplation of the Merger, Alliqua declared a special cash dividend to the pre-Merger shareholders of Alliqua as of April 22, 2019. The aggregate dividend of $5,245,000, or $1.05 per share, was paid on May 29, 2019. Spin-off On November 27, 2018, Alliqua had entered into an agreement whereby its existing operations would be distributed to existing shareholders as of a record date. With the exception of a corporate lease, substantially all of Alliqua’s assets and liabilities were contributed to a subsidiary, AquaMed Technologies Inc. (“AquaMed”), whose shares were then distributed to the pre-Merger shareholders of Alliqua by way of a pro rata stock dividend on June 21, 2019. The book value of the dividend was less than $0.01 per share. Because the historical periods presented prior to the merger are those of Private Adynxx, the results of AquaMed are only reflected in these financial statements from the merger date to the date of the pro rata dividend of AquaMed and are presented as discontinued operations in the condensed consolidated statement of operations. Pro Forma Financial Information As the only significant operations of Alliqua have been discontinued with the spin-off transaction, pro forma financial information for periods prior to the merger is not presented herein as such results are not meaningful. |
Note 4 - Property and Equipment
Note 4 - Property and Equipment, Net | 6 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Dec. 31, 2018 | |
Notes to Financial Statements | ||
Property, Plant and Equipment Disclosure [Text Block] | Note 4. Property and Equipment, Net Property and equipment, net, consist of the following (in thousands): December 31, 2018 June 30, 2019 Furniture and fixtures $ $ Office equipment Computer equipment Laboratory equipment Total property and equipment Less accumulated depreciation ) ) Property and equipment, net $ $ Depreciation expense at December 31, 2018 and for the six months ended June 30, 2018 and 2019 was $8,000, $4,000 and $4,000, respectively. | Note 3. Property and Equipment, Net Property and equipment, net, consist of the following (in thousands): As of December 31, 2017 2018 Furniture and fixtures $ 29 $ 29 Office equipment 2 2 Computer equipment 24 18 Laboratory equipment 2 2 Total property and equipment 57 51 Less accumulated depreciation (44) (41) Property and equipment, net $ 13 $ 10 Depreciation expense for the years ended December 31, 2017 and 2018 was $10,000 and $8,000, respectively. |
Note 4 - Accrued Liabilities
Note 4 - Accrued Liabilities | 12 Months Ended |
Dec. 31, 2018 | |
Notes to Financial Statements | |
Accounts Payable and Accrued Liabilities Disclosure [Text Block] | Note 4. Accrued Liabilities Accrued liabilities consist of the following (in thousands): As of December 31, 2017 2018 Payroll and related expenses $ 273 $ 241 Accrued term loan final payment 197 421 Accrued clinical trial expense 654 — Professional fees and other costs 34 195 Total accrued liabilities $ 1,158 $ 857 |
Note 5 - Other Balance Sheet In
Note 5 - Other Balance Sheet Information | 6 Months Ended |
Jun. 30, 2019 | |
Notes to Financial Statements | |
Supplemental Balance Sheet Disclosures [Text Block] | Note 5. Other Balance Sheet Information Prepaid and other current assets consist of the following (in thousands): December 31, 2018 June 30, 2019 Prepaid clinical trial expenses $ $ Equity issuance costs — Prepaid insurance — Other prepaid expenses Total prepaid and other current assets $ $ Accrued liabilities consist of the following (in thousands): December 31, 2018 June 30, 2019 Payroll and related expenses $ $ Accrued term loan final payment Accrued clinical trial expense — Professional fees and other costs Total accrued liabilities $ $ |
Note 6 - Term Loans and Convert
Note 6 - Term Loans and Convertible Promissory Notes | 6 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Dec. 31, 2018 | |
Notes to Financial Statements | ||
Debt Disclosure [Text Block] | Note 6. Term Loans and Convertible Promissory Notes Term Loans On November 24, 2015, the Company entered into a loan and security agreement (“Loan Agreement”) with Oxford, pursuant to which the Company received $3.0 million in proceeds from a Term Loan A and $2.0 million in proceeds from a Term Loan B under the Loan Agreement (collectively the “Term Loans”). Warrants to purchase 11,829 shares of common stock were issued to Oxford in connection with the Term Loans (‘ Note 9 — Warrants’ ). The Term Loans bear interest at a floating per annum rate equal to (a) 7.06% plus (ii) the greater of (a) the 30 day U.S. Dollar LIBOR rate reported in the Wall Street Journal on the last business day of the month that immediately precedes the month in which the interest will accrue or (b) 0.19%. The Term Loan A was recorded at its initial carrying value of $3.0 million less debt issuance costs of approximately $141,000, and the Term Loan B was recorded at its initial carrying value of $2.0 million, less debt issuance costs of approximately $3,000. The debt issuance costs are being amortized to interest expense over the life of the Term Loans using the effective interest method. As of December 31, 2018, $2.3 million was outstanding under Term Loan A and $1.5 million was outstanding under Term Loan B. At June 30, 2019, $1.4 million was outstanding under Term Loan A and $1.0 million was outstanding under Term Loan B. The following modifications have been made during the six months ended June 30, 2019: · In January 2019, the Company and Oxford agreed to amend the Loan Agreement. Oxford agreed to two months of interest-only payments followed by eight months of repayments upon delivery by February 1, 2019 of an executed term sheet for equity financing that would result in aggregate proceeds to the Company of $20.0 million. The Company was also required to place $200,000 in a segregated bank account that is subject to a blocked control agreement in favor of Oxford. The funds in the segregated account were to be released upon the earlier of the consummation of a merger by March 31, 2019 or the consummation of an equity financing by March 31, 2019. The Company recorded the $200,000 as restricted cash in its balance sheet at June 30, 2019. The maturity date of the Term Loans remained unchanged. The amendment fee amounted to $50,000. The amendment was accounted for as a debt modification. · In May 2019, the Company and Oxford agreed to an amendment to provide consent to the Merger. This consent amended certain provisions of the Term Loans to protect Oxford’s rights under the original Loan Agreement. The consent allowed Alliqua (now Adynxx, Inc.) to be named as an additional borrower. · In June 2019, the Company and Oxford agreed to amend the Loan Agreement. Oxford agreed to two months of interest-only payments and the maturity date of the Term Loans was extended two months to January 1, 2020. The amendment fee amounted to $20,000. The amendment was accounted for as a debt modification. Upon the respective dates of the debt modifications, no gain or loss was recorded, and a new effective interest rate was established based on the carrying value of the debt and the revised cash flows. Interest expense associated with the Term Loans was $309,000 and $336,000 for the six months ended June 30, 2018 and 2019, respectively. As of June 30, 2019, the Company was in compliance with all covenants under the Loan Agreement. Principal payments for the Term Loans due under the Loan Agreement as of June 30, 2019 are due monthly beginning September 1, 2019 and the Term Loans mature on January 1, 2020. Convertible Promissory Notes The table below reflects the principal amount of the Notes issued by the Company (in thousands): December 31, 2018 June 30, 2019 Convertible note payable, due on March 29, 2019 $ $ — Convertible note payable, due on September 27, 2019 — Convertible note payable, due on December 21, 2019 Convertible note payable, due on March 29, 2020 — Convertible note payable, due on April 26, 2020 — Convertible note payable, due on May 29, 2020 — Total $ $ Outstanding Notes The Notes outstanding at June 30, 2019 were issued with conversion and repayment rights as described below: (a) in the event that the Company issues and sells equity securities with proceeds to the Company of at least $5 million, on or before the maturity date, then the outstanding principal amount of this convertible promissory note and any unpaid accrued interest will automatically convert in whole into equity securities of the same class sold in the equity financing at a conversion price equal to the cash price paid per share for equity securities in the financing, and (b) if the Company consummates a change of control while the Notes remain outstanding, the Company shall repay the holders in cash in an amount equal to 200% of the outstanding principal amount of the Notes. In April 2019 and May 2019, affiliates of Domain Partners, LLC, a significant shareholder of the Company, purchased from the Company $2.0 million and $0.5 million aggregate principal amount of Notes. The proceeds from the issuances were used for general corporate purposes and working capital. These Notes accrue simple interest on the outstanding principal amount at a rate of 8% per annum and mature on April 26, 2020 and May 29, 2020, respectively. Converted Notes In May 2019, under the terms of the then-outstanding Notes, the principal and accrued unpaid interest of two Notes totaling $3.2 million were automatically converted into the Company’s Series B convertible preferred stock. Upon consummation of the Merger, and subject to the terms and conditions of the Merger Agreement, each outstanding share of capital stock of Adynxx was converted into the right to receive the number of shares of the combined Company’s common stock equal to the Exchange Ratio. An aggregate of 367,041 post-Merger common shares were issued associated with the conversion of these Notes. In connection with a previous modification, the Company had computed a contingent BCF that was contingent upon the occurrence of a reverse merger. In accordance with ASC 470-20-25-6, the contingent BCF is not recognized in earnings until the contingency is resolved. Upon the date of the Merger, the full amount of beneficial conversion feature of $2.1 million was recognized as interest expense in the condensed consolidated statement of operations for the six months ended June 30, 2019. Derivative Liability The Company evaluated its outstanding Notes and determined that certain embedded components relating to conversion and redemption features of those contracts qualified as derivatives, which need to be separately accounted for in accordance with ASC 815. With the consummation of the Merger, several of these clauses no longer apply. However, the redemption provision upon change of control described above is an embedded feature that is required to be bifurcated. As of December 31, 2018, the Company evaluated the fair value of the derivative liability and determined that the bifurcated derivative liability had no value because the Company estimated a zero probability of the embedded feature being triggered. As a result, the Company estimated the fair value of the derivative liability to be zero at December 31, 2018. Similarly, the embedded derivatives that were in place at June 30, 2019 also had a fair value of zero. | Note 5. Term Loans and Convertible Promissory Notes Term Loans On November 24, 2015, the Company entered into a loan and security agreement (“Loan Agreement”) with Oxford Finance, LLC (“Oxford”), pursuant to which Oxford agreed to lend the Company up to $10.0 million, issuable in three tranches of $3.0 million (the “Term Loan A”), $2.0 million (the “Term Loan B”) and $5.0 million (the “Term Loan C”). Term Loan A, Term Loan B and Term Loan C will collectively be referred to as Term Loans. On November 24, 2015, the Company received $3.0 million in proceeds from Term Loan A and on January 29, 2016, the Company received $2.0 million in proceeds from Term Loan B. Warrants were issued in connection with Term Loan A and Term Loan B (See Note 8 — Warrants ). Under the terms of the Loan Agreement, the Company may, at its sole discretion, borrow $5.0 million under the Term Loan C following the achievement of a defined milestone event until the earlier of 30 days thereafter or March 31, 2016. The Company did not draw on Term Loan C at March 31, 2016 and the availability of the $5.0 million under Term Loan C expired. All outstanding Term Loans will mature on November 1, 2019 (the “Maturity Date”) and the Company will have interest only payments through November 1, 2016, followed by 36 months of principal and interest payments. The term loans will bear interest at a floating per annum rate equal to (a) 7.06% plus (ii) the greater of (a) the 30 day U.S. Dollar LIBOR rate reported in the Wall Street Journal on the last business day of the month that immediately precedes the month in which the interest will accrue or (b) 0.19%. The Company has the option to prepay all, but not less than all, of the borrowed amounts, provided that the Company will be obligated to pay a prepayment fee equal to (i) 3% of the outstanding principal balance of the applicable Term Loan if prepayment is made prior to the first anniversary of the applicable funding date of the Term Loan, provided, however, the prepayment fee will be reduced to 1% if the Company is acquired within six months from the Term Loan closing date, or (ii) 2% of the outstanding principal balance of the applicable Term Loan if prepayment is made prior to the second anniversary of the applicable funding date of the Term Loan, or (iii) 1% of the applicable Term Loan prepaid thereafter and prior to the Maturity Date. The Company will be required to make a final payment of 4.25% of the funded amount, payable on the earlier of (i) the Maturity Date or (ii) the prepayment of the Term Loan. The Company may use the proceeds from the Term Loans solely for working capital and to fund its general business requirements. The Company’s obligations under the Loan Agreement are secured by a perfected first priority lien in all of its assets with a negative pledge on owned intellectual property. In January 2017, the Company and Oxford Finance agreed to amend the Loan Agreement. After the Company made principal payments on December 1, 2016 and January 1, 2017, Oxford agreed to an additional 12 months of interest-only payments followed by 23 months of amortization. The amendment fee amounted to $100,000. The amendment was accounted for as a debt modification. In March 2018, the Company and Oxford Finance agreed to amend the Loan Agreement. After the Company made principal payments on January 1, 2018, February 1, 2018 and March 1, 2018 Oxford agreed to another 5 months of interest-only payments followed by 15 months of amortization. The amendment fee amounted to $200,000. This amendment was accounted for as a debt modification. In September 2018, the Company and Oxford Finance agreed to amend the debt agreement. Oxford agreed to 1 month of interest-only payments upon closing a $1.5 million convertible promissory note with current investors followed by 2 months of interest-only payments upon entering into a merger followed by 11 months of repayments. The maturity date of the Term Loans remains unchanged. The amendment fee amounted to $25,000. The amendment was accounted for as a debt modification. In December 2018, the Company and Oxford Finance agreed to amend the debt agreement. Oxford agreed to 1 month of interest-only payments upon closing a $1.5 million convertible promissory note with current investors by December 31, 2018, followed by 10 months of repayments. The maturity date of the loans remains unchanged. The amendment fee amounted to $35,000. The amendment was accounted for as a debt modification. The amendment fees are due and payable upon the earlier of: (i) the Maturity Date, (ii) the acceleration of any Term Loan, or (iii) the prepayment of a Term Loan, and are being accrued over the expected term of the Term Loan as interest expense. Upon the respective dates of the debt modifications, no gain or loss was recorded, and a new effective interest rate was established based on the carrying value of the debt and the revised cash flows. The Term Loan A was recorded at its initial carrying value of $3.0 million less debt issuance costs of approximately $141,000, Term Loan B was recorded at its initial carrying value of $2.0 million, less debt issuance costs of approximately $3,000. The debt issuance costs are being amortized to interest expense over the life of the Term Loan using the effective interest method. The final payment is accrued over the life of the Term Loan through interest expense using the effective interest method. At December 31, 2017, $2.8 million was outstanding under Term Loan A and $1.9 million was outstanding under Term Loan B. As of December 31, 2018, $2.3 million was outstanding under Term Loan A and $1.5 million was outstanding under Term Loan B. Interest expense recorded for the years ended December 31, 2017 and 2018 was $515,000 and $644,000, respectively. As of December 31, 2018, the Company was in compliance with all covenants under the Loan Agreement. Future principal payments for the Term Loans due under the Loan Agreement as of December 31, 2018, were as follows (in thousands): Year Ending, December 31, 2019 Total principal payments $ 3,833 Convertible Promissory Notes The table below reflects the principal amount of the Notes issued by the Company to current investors (in thousands): As of December 31, 2017 2018 Convertible note payable, due on March 29, 2019, interest at 8.0% p.a $ — $ 1,500 Convertible note payable, due on September 27, 2019, interest at 8.0% p.a — 1,500 Convertible note payable, due on December 21, 2019, interest at 8.0% p.a — 1,500 Total $ — $ 4,500 Conversion rights The December 2018 Notes were issued with conversion and repayment rights, which are as follows: (a) (b) (c) in the event of a preferred stock financing after the Company’s Board of Directors (the “Board”) has determined that the Company should not pursue the proposed reverse merger with Alliqua BioMedical, Inc. or that such reverse merger is not viable, then in connection with the preferred stock financing the conversion price shall equal eighty percent (80%) of the cash price paid per share for the preferred securities by the investors in the preferred stock financing; (d) if the Company consummates a change of control while the Notes remain outstanding, the Company shall repay the holders in cash in an amount equal to 200% of the outstanding principal amount of the Notes; and (e) in the event the Company consummates an IPO on or before the maturity date, then the outstanding principal amount of the Notes and any unpaid accrued interest will automatically convert into common stock at a conversion price equal to the per share offering price to the public for common stock in the IPO. The Modified March 2018 and Modified September 2018 Notes were outstanding as of December 31, 2018, and had conversion and repayment rights as follows: (a) in the event that the Company issues and sells shares of its preferred stock to the investors on or before the maturity date, in a preferred stock financing, then the outstanding principal amount of this convertible promissory note and any unpaid accrued interest will automatically convert in whole into equity securities sold in the qualified financing at a conversion price equal to 80% of the cash price paid per share for equity securities by the investors in the qualified financing; (b) if the Company consummates a change of control while the Notes remain outstanding, the Company shall repay the holders in cash in an amount equal to 200% of the outstanding principal amount of the Notes; and (c) in the event the Company consummates an IPO on or before the maturity date, then the outstanding principal amount of the Notes and any unpaid accrued interest will automatically convert into common stock at a conversion price equal to the per share offering price to the public for common stock in the IPO. (d) In October 2018, the Company modified the terms of the March 2018 and September 2018 Notes to add an additional conversion option. The additional conversion option stipulated that if the Company consummates a reverse merger on or before the Maturity Date and prior to a Qualified Financing (as such terms are defined in the Notes Agreement), then the outstanding principal amount of the Notes and any unpaid accrued interest, shall automatically convert in whole without any further action by the Holder into shares of the Company’s Series B convertible preferred stock at a conversion price equal to $0.3133 per share immediately prior to the closing of the reverse merger. In October 2018, the Company determined that the modification of the March 2018 and September 2018 Notes adding the additional conversion right upon a reverse merger was a “substantial modification” as outlined in ASC 470-50 ‘Debt: Modifications and Extinguishments’ and treated this modification as an extinguishment of the original Notes and recognized an $11,000 gain from debt extinguishment in its statement of operations. Derivative Liability The Company evaluated its Notes and determined that embedded components relating to conversion and redemption features of those contracts qualified as derivatives, which need to be separately accounted for in accordance with ASC 815. The Notes contained embedded features that are required to be bifurcated as follows: (1) (2) (3) Accordingly, upon the issuance of the March 2018 Notes, the estimated fair value of the embedded derivative was determined using a bond plus option valuation model and assuming a probability of 30% that a qualified financing would occur and a probability of 15% that a change in control would occur. The Company recorded the estimated fair value of these embedded derivatives as a liability of $496,000 with an offsetting amount recorded as debt discount, which offsets the carrying amount of the debt. The debt discount is amortized over the debt’s expected term of one year. Upon the issuance of the September 2018 Notes, the estimated fair value of the embedded derivatives was determined using a bond plus option valuation model and assuming a probability of 40% that a qualified financing would occur and a zero probability that a change in control would occur. The Company recorded the estimated fair value of these embedded derivatives as a liability of $368,000 with an offsetting amount recorded as debt discount, which offsets the carrying amount of the debt. The debt discount is amortized over the debt expected term of one year. In October 2018, the Company modified the March 2018 and September 2018 Notes by adding an additional conversion right upon a reverse merger. The Company deemed this modification to be a “substantial modification” as defined in ASC 470-50 ‘Debt: Modifications and Extinguishments’ and treated it as an extinguishment of the original Notes and the termination of the related derivative liability. The extinguishment of the March 2018 and September 2018 Notes, resulted in a net gain of $11,000 being recorded in other income due to the expensing of the unamortized debt discount of $641,000 and the release of the then fair value of the derivative liabilities of $653,000. As of December 31, 2018, the Company evaluated the fair value of the derivative liability associated with the modified March 2018, modified September 2018 and December 2018 Notes. It determined that the bifurcated derivative liability had no value because the Company assumed a zero probability that a qualified financing would occur if the then planned reverse merger was not consummated and a zero probability that a change in control would occur. As a result, the Company estimated the fair value of the derivative liability to be $0 at December 31, 2018. For the years ended December 31, 2017, and 2018, the Company had recorded interest expense for debt discount on these Notes of $0 and $223,000, respectively. |
Note 6 - Commitments and Contin
Note 6 - Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2018 | |
Notes to Financial Statements | |
Commitments and Contingencies Disclosure [Text Block] | Note 6. Commitments and Contingencies Operating Leases The Company leases office facilities under a non-cancelable operating lease agreement expiring on December 31, 2019. The total undiscounted future non-cancellable lease payments under the Company’s operating lease as of December 31, 2018 are as follows (in thousands): Future Year ending December 31 Commitments 2019 $ 239 Total $ 239 Rent expense related to the Company’s operating leases was $225,000 and $232,000 for the years ended December 31, 2017 and 2018, respectively. Indemnif ications The Company has agreed to indemnify its directors and officers for certain events or occurrences arising as a result of the officers or directors serving in such capacity. The Company has a directors’ and officers’ liability insurance policy that limits its exposure and enables the Company to recover a portion of any future amounts paid resulting from the indemnification of its officers and directors. The Company has not incurred material costs to defend lawsuits or settle claims related to these indemnification agreements. The Company’s management believes the estimated fair value of these indemnification agreements is minimal and has not recorded a liability for these agreements as of December 31, 2018. |
Note 7 - Leases
Note 7 - Leases | 6 Months Ended |
Jun. 30, 2019 | |
Notes to Financial Statements | |
Lessee, Operating Leases [Text Block] | Note 7. Leases The Company leases office facilities under a non-cancelable operating lease agreement expiring on December 31, 2019. The Company also leases a corporate office facility previously utilized by Alliqua through an operating lease agreement, located in Yardley, Pennsylvania that expires in 2023. Effective February 1, 2019, this property has been subleased to The Pinnacle Health Group, Inc. through April 20, 2023 and the Company receives monthly lease payments. Future minimum payments under non-cancellable leases as of June 30, 2019 are as follows (in thousands): Period ending December 31 Future Commitments 2019 (remaining 6 months) $ 232 2020 227 2021 232 2022 236 2023 80 Total future minimum lease payments 1,007 Less: imputed interest (167) Total $ 840 Total operating lease expenses for the six months ended June 30, 2018 and 2019 was $115,000 and $165,000, respectively, and are reflected in general and administrative expenses in the condensed consolidated statements of operations. As of June 30, 2019, the Company had no leases that were classified as a financing lease. As of June 30, 2019, the Company did not have additional operating and financing leases that have not yet commenced. During the six months ended June 30, 2019, the Company recognized $42,000 of sublease income on its condensed consolidated statement of operations, which is recorded as an offset against general and administrative expenses. |
Note 7 - Stockholders' Deficit
Note 7 - Stockholders' Deficit | 12 Months Ended |
Dec. 31, 2018 | |
Notes to Financial Statements | |
Stockholders' Equity Note Disclosure [Text Block] | Note 7 . Stockholders’ Deficit Redeemable Convertible Preferred Stock As of December 31, 2017 and 2018, the Company had 56,672,658 shares of Series A convertible preferred stock issued and outstanding, including 3,531,889 shares issued as a result of a conversion of notes to investors and accrued interest to Series A convertible preferred stock in 2010. As of December 31, 2017 and 2018, the Company had 51,069,262 shares of Series B convertible preferred stock issued and outstanding, including 6,469,356 shares issued as a result of a conversion of notes to investors and accrued interest to Series B convertible preferred stock in 2016. The holders of preferred stock have various rights and preferences including the following: Voting Rights — A holder of each share of Series A and Series B convertible preferred stock shall have the right to one vote for each share of common stock into which such preferred stock could be converted. Series A convertible preferred stock holders voting as a separate class are entitled to elect two directors to the Company’s Board of Directors as long as shares of Series A convertible preferred stock remain outstanding. Series B convertible preferred stock holders voting as a separate class are entitled to elect one director to the Company’s Board of Directors as long as at least 10,000,000 shares of Series B convertible preferred stock remain outstanding. Common stockholders voting as a separate class are entitled to elect two directors. The holders of preferred and common stock voting together as a single class on an as-if-converted basis are entitled to elect all remaining directors. Dividends — Holders of Series B convertible preferred stock, in preference to the holders of Series A preferred and common stock, are entitled to receive noncumulative dividends at the annual rate of $0.0251 per share, when, as, and if declared by the Board of Directors. Holders of Series A convertible preferred stock are entitled to receive noncumulative dividends at the annual rate of $0.0182 per share, when, as, and if declared by the Board of Directors. No dividends on preferred stock have been declared by the Board of Directors during the years ended December 31, 2017 and 2018. Liquidation Preference — In the event of any liquidation, dissolution, or winding up of the Company, including a merger, acquisition, or sale of assets, as defined, the holders of Series B convertible preferred stock are entitled to receive an amount of $0.3133 per share (as adjusted for recapitalizations, stock combinations, stock dividends, stock splits, and the like), plus any declared but unpaid dividends prior to and in preference to any distribution to the holders of Series A preferred or common stock. After distributions have been made to all holders of Series B convertible preferred stock as described above, the remaining assets of the Company available for distribution to stockholders shall be distributed to all holders of Series A convertible preferred stock. The holders of Series A convertible preferred stock are entitled to receive an amount of $0.2276 per share (as adjusted for recapitalizations, stock combinations, stock dividends, stock splits, and the like), plus any declared but unpaid dividends prior to and in preference to any distribution to the holders of common stock. The remaining assets of the Company available for distribution to stockholders shall be distributed ratably among the holders of the common stock and preferred stock on an as-if-converted basis. Conversion Rights — Each share of Series A and Series B convertible preferred stock is convertible, at the option of the holder, into shares of common stock on a one for one basis (subject to adjustment for certain events). The preferred stock will also be converted automatically into shares of common stock (1) immediately prior to an initial public offering with aggregate proceeds of at least $40 million and an offering price of not less than $1.00 per common share or (2) upon the date specified by written consent of holders of a majority of the outstanding preferred shares on an as-converted basis. The Series A and Series B Preferred Stock were classified as temporary equity in the accompanying balance sheets as of the December 31, 2017 and 2018, as shares are subject to redemption upon the occurrence of uncertain events not solely within the Company’s control. As of December 31, 2017 and 2018, the Series A and Series B Preferred Stock were not redeemable. Common Stock The Company’s articles of incorporation, as amended, authorize the Company to issue 148,000,000 shares of $0.001 par value common stock. As of December 31, 2017 and 2018, the Company had 19,548,969 shares outstanding. Common stockholders are entitled to dividends when and if declared by the Board of Directors and after any Series B and Series A convertible preferred shares dividends are fully paid. The holder of each share of common stock is entitled to one vote. At December 31, 2018, no dividends had been declared. Shares Reserved for Future Issuance The Company reserved shares of common stock for future issuances as follows (in thousands): As of December 31, 2017 2018 Series A convertible preferred stock Series B convertible preferred stock Warrants for Series A convertible preferred stock Common stock options issued and outstanding Total |
Note 8 - Redeemable Convertible
Note 8 - Redeemable Convertible Preferred Stock | 6 Months Ended |
Jun. 30, 2019 | |
Notes to Financial Statements | |
Preferred Stock [Text Block] | Note 8. At December 31, 2018, 2,034,548 1,833,387 2019, 367,041 ‘Note 6 Upon the consummation of the Merger, all outstanding shares of Series A and Series B convertible preferred stock were cancelled and exchanged for shares of the Company’s common stock. Following the Merger, Private Adynxx survived as a wholly-owned subsidiary of new Adynxx, Inc. and adopted a new certificate of incorporation with no 1,000,000 |
Note 9 - Warrants
Note 9 - Warrants | 6 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Dec. 31, 2018 | |
Notes to Financial Statements | ||
Warrants Disclosure [Text Block] | Note 9. Warrants Private Adynxx had issued warrants that were previously classified as a liability as they were exercisable for preferred shares that were potentially redeemable. The fair value of the warrant liability was re-measured at each balance sheet date up through the date of the Merger with the change as other income recorded in the statements of operations. On May 3, 2019, in connection with the closing of the Merger, each outstanding Adynxx warrant that had not previously been exercised was converted into a stock warrant to purchase shares of the Company’s common stock at the Exchange Ratio and, as a result, outstanding warrants were converted into warrants to purchase an aggregate of 11,829 shares of the Company’s common stock at an exercise price of $6.34 per share. As such warrants qualify for equity classification, the Company reclassified the balance of $234,000 from warrant liability to additional paid in capital. These warrants are exercisable at any time and expire in 2025 and 2026. Additionally, upon the closing of the Merger on May 3, 2019, the Company assumed outstanding Alliqua warrants to purchase an aggregate of 38,945 shares of common stock at exercise prices ranging from $26.40 to $28.20 per share. These warrants are exercisable at any time and expire in 2022. | Note 8. Warrants In connection with convertible notes agreements with investors issued between January 1, 2009 and July 1, 2010, the Company issued warrants to purchase such number of shares of Series A convertible preferred stock issued in the next round of equity financing equal to 20% of notes payable principal amounts divided by the price per share of such preferred stock. The warrants are exercisable after closing of each preferred stock financing for five years and expire seven years from the issuance date. At the issuance dates, the Company estimated the fair value of issued warrants as minimal due to the uncertainty of the Series A convertible preferred stock financing. The Company estimated the fair value of outstanding warrants at the date of closing of the Series A convertible preferred stock financing and used the Black-Scholes model with the following assumptions: expected lives equal to the remaining contractual life in a range of 3.92 to 7 years, risk-free interest rates in a range of 1.46% to 2.66%, expected dividend yield of zero, volatility in the range of 73.6% to 81.5%, and a fair value of Series A convertible preferred stock of $0.2276 per share. As of December 31, 2017, the outstanding warrants had been exercised. In connection with the Oxford Loan Agreement signed in November 2015, the Company issued a warrant to purchase 197,715 shares of the Company’s preferred stock at an exercise price equal to the Series A preferred stock price of $0.2276. The warrant is exercisable after closing and expires ten years from the issuance date. The Company estimated the fair value of the warrant at closing and used the Black-Scholes model with the following assumptions: expected life equal to the remaining contractual life of 10 years, risk-free interest rate of 2.07%, expected dividend yield of zero, volatility of 68.7%, and a fair value of Series A convertible preferred stock of $0.20 per share. The Company recorded the fair value of the warrant of $33,000 as a debt discount to be amortized to interest expense over the life of the Term Loan A. In January 2016, in connection with the Oxford Loan Agreement signed in November 2015, the Company issued a warrant to purchase 131,810 shares of the Company’s preferred stock at an exercise price equal to the Series A preferred stock price of $0.2276. The warrant is exercisable after closing and expires ten years from the issuance date. The Company estimated the fair value of the warrant at closing and used the Black-Scholes model with the following assumptions: expected life equal to the remaining contractual life of 10 years, risk-free interest rate of 2.09%, expected dividend yield of zero, volatility of 68.6%, and a fair value of Series A convertible preferred stock of $0.23 per share. The Company recorded the fair value of the warrant of $22,000 as a debt discount to be amortized to interest expense over the life of the Term Loan B. The change in fair value of the warrants issued in connection with Term Loan A and B at December 31, 2017 and 2018 of ($12,000) and $98,000 respectively, were recorded to other expense (income). As of December 31, 2018, the warrants remained outstanding and exercisable. The above Black-Scholes model assumptions were determined as follows: Term — The term represents the remaining contractual term of the warrants. Risk-free interest rate — The risk-free interest rate is based on the U.S. Treasury yield in effect at the time of grant for zero coupon U.S. Treasury notes with maturities approximately equal the remaining term of the warrants. Expected volatility — The expected volatility is derived from historical volatilities of several unrelated publicly listed peer companies over a period approximately equal to the remaining term of the warrants because the Company has limited information on the volatility of the preferred stock since there is currently no trading history. When making the selections of the Company’s industry peer companies to be used in the volatility calculation, the Company considered the size and operational and economic similarities to the Company’s principal business operations. Expected dividend yield — The expected dividend yield is based on the Company’s history of not paying dividends. The warrants are classified as a liability as they are exercisable into shares that are potentially redeemable. The fair value of the warrant liability is re-measured at each balance sheet date with the change as other income recorded in the statements of operations. The fair value of the Series A convertible preferred stock warrants outstanding at December 31, 2017 and 2018 was $42,000 and $140,000 respectively, and the details of the warrants were as follows: Number of Shares Issuance Date Expiration Date Exercise Price (in thousands) November, 2015 November, 2025 0.2276 198 January, 2016 January, 2026 0.2276 132 Total 330 The fair value of the Series A convertible preferred stock warrants was determined using the following assumptions: As of December 31, 2017 2018 Risk-free interest rate 2.28 % 2.56% – 2.59 % Remaining contractual life (in years) 7.92 – 8.08 6.92 – 7.08 Dividend yield — — Expected volatility 71.00 % 76.84 % |
Note 10 - Stock Options
Note 10 - Stock Options | 6 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Dec. 31, 2018 | |
Notes to Financial Statements | ||
Share-based Payment Arrangement [Text Block] | Note 10. Stock Options On May 3, 2019, in connection with the closing of the Merger, each outstanding Private Adynxx stock option, whether vested or unvested, was converted into a stock option to purchase shares of the Company’s common stock at the Exchange Ratio and, as a result, the Company issued options to purchase an aggregate of 690,058 shares of the Company’s common stock at exercise prices ranging from $1.11 to $3.06 per share. Additionally, at the date of the Merger, Alliqua had outstanding employee options to purchase an aggregate of 57,822 shares of the post-Merger Company’s common stock at exercise prices ranging from $21.00 to $656.40 per share to former Alliqua option holders that were assumed as part of the merger. All Alliqua employees were terminated in connection with the Merger; however, such options have provisions that extend the expiration date beyond the employees’ termination date. A summary of the Company’s stock option activity during the six months ended June 30, 2019 is as follows (in thousands, except exercise prices): Number of Weighted Weighted Average Remaining Intrinsic Outstanding, December 31, 2018 $ Alliqua options assumed in Merger 58 Exercised — — Cancelled — — Outstanding, June 30, 2019 $ $ Exercisable, June 30, 2019 $ $ A summary of the Company’s stock options as of June 30, 2019 is as follows (in thousands, except exercise prices): Options Outstanding Options Exercisable Range of Exercise Price Weighted Average Exercise Price Outstanding Number of Options Weighted Average Exercise Price Weighted Average Remaining Life In Years Exercisable Number of Options $1.11 — $1.38 $ 73 $ 73 1.39 — 3.05 1.39 37 1.39 37 3.06 — 20.99 3.06 580 3.06 362 21.00 — 656.40 289.81 58 289.81 58 $ 24.95 748 $ 530 The Company did not grant any stock options to employees during the six months ended June 30, 2019. Stock-based compensation expense recorded in research and development and general and administrative expenses was $150,000 and $136,000 for the six months ended June 30, 2018 and 2019, respectively. As of June 30, 2019, unrecognized stock-based compensation expense related to employees totaled approximately $395,000, which is expected to be recognized over approximately 1.5 years. Stock-based compensation expense recorded in exchange for services related to non-employee options was $0 and $32,000 for the six months ended June 30, 2018 and 2019, respectively. As of June 30, 2019, unrecognized stock-based compensation expense related to unvested non-employees stock options was approximately $16,000, which is expected to be recognized over a weighted-average period of three months. | Note 9. Stock Option Plans In December 2010, the Company adopted the 2010 Equity Incentive Plan (the “Plan”). The Plan provides for the granting of stock options to employees and consultants of the Company. Options granted under the Plan may be either incentive stock options (“ISOs”) or non-qualified stock options (“NSOs”). ISOs may be granted only to Company employees (including officers and directors who are also employees). NSOs may be granted to Company employees and consultants. The Company has 19,222,032 shares of common stock reserved for issuance under the Plan as of December 31, 2018. Options under the Plan may be granted for periods of up to 10 years and at prices no less than 100% of the estimated fair value of the underlying shares of common stock on the date of grant as determined by the Board of Directors provided, however, that the exercise price of an ISO and NSO granted to a 10% shareholder shall not be less than 110% of the estimated fair value of the shares on the date of grant. The Plan requires that options be exercised no later than 10 years after the grant. Options granted to employees generally vest ratably on a monthly basis over four years. The following table summarizes stock option activity under the Company’s stock plan and related information (in thousands, except exercise prices and years): Outstanding Options Weighted- Weighted- Average Average Remaining Shares Exercise Contractual Aggregate Available Options Price Life Intrinsic For Grant Outstanding Per Share (in years) Value (a) Balance at December 31, 2016 5 $ 0.10 9.4 Balance at December 31, 2017 5 19,222 $ 8.4 $ 6,639 Balance at December 31, 2018 5 $ 7.4 $ 6,956 Vested and expected to vest as of December 31, 2018 $ 7.4 $ 6,956 Exercisable at December 31, 2018 $ 7.4 $ 4,119 (a) The aggregate intrinsic value is calculated as the difference between the stock option exercise price and the estimated fair value of the Company’s common stock of $0.46 and $0.44 per share as of December 31, 2018 and 2017. The Company did not grant any common stock options to employees during the years ended December 31, 2017 and 2018. Stock-based compensation expense recorded in research and development and general and administrative expenses was $301,000 and $293,000 for the years ended December 31, 2017 and 2018, respectively. As of December 31, 2018, unrecognized stock-based compensation expense related to employees totaled approximately $531,000, which is expected to be recognized over approximately 2.0 years. Stock Options Granted to Non-Employees Stock-based compensation expense recorded in exchange for services related to non-employee options was $0 and $16,000 for the years ended December 31, 2017 and 2018, respectively. As of December 31, 2018, unrecognized stock-based compensation expense related to unvested non-employees stock options was approximately $48,000, which is expected to be recognized over a weighted-average period of nine months. |
Note 10 - Income Taxes
Note 10 - Income Taxes | 12 Months Ended |
Dec. 31, 2018 | |
Notes to Financial Statements | |
Income Tax Disclosure [Text Block] | Note 10. Income Taxes The Company recorded no income tax benefit or expense for the years ended December 31, 2017 and 2018. No tax benefit was recorded through December 31, 2018 because, given the history of operating losses, the Company believes it is more likely than not that the deferred tax asset will not be realized, and a full valuation allowance has been provided. Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The following table presents significant components of the Company’s deferred tax assets (in thousands): As of December 31, 2017 2018 Net operating loss carry forward $ 6,158 $ 7,051 Research and development credits 1,284 1,601 Accruals and reserves 99 142 Fixed assets — 1 Total deferred tax asset 7,541 8,795 Valuation allowance (7,541) (8,795) Net deferred tax asset $ — $ — The Company has evaluated the positive and negative evidence bearing upon the realizability of its deferred tax assets. Based on the Company’s history of operating losses, the Company has concluded that it is more likely than not that the benefit of its deferred tax assets will not be realized. Accordingly, the Company has provided a full valuation allowance for deferred tax assets as of December 31, 2017 and 2018. The valuation allowance decreased approximately $964,000 and increased $1.2 million during the years ended December 31, 2017 and 2018, respectively. On December 22, 2017, the U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act (the “Tax Act”). The Tax Act makes broad and complex changes to the U.S. tax code that affect fiscal 2017, including, but not limited to requiring a one-time transition tax on certain un-repatriated earnings of foreign subsidiaries (the “Transition Tax”). The Tax Act also establishes new tax laws that will affect 2018 and later years, including, but not limited to, a reduction of the U.S. federal corporate tax rate from 35% to 21% and a transition of U.S. international taxation from a worldwide tax system to a territorial system. During the year ended December 31, 2017, the Company did not recognize an amount for the one-time transition tax, nor did the Company make any accounting policy elections on the treatment of the other international provisions of tax reform due to the fact the Company does not currently have any foreign subsidiaries. During 2017, the Company corrected the balance of Net Operating Losses and Research and Development Credits and the associated Valuation Allowances in connection with the Company’s determination of nexus in an additional state which was previously not identified correctly. The correction of such error did not have any impact on the Company’s financial position and results of operations for any period presented or any prior period results. The Company has corrected the gross amount of deferred tax assets and the valuation allowance for 2016 to correct the error. As of December 31, 2018, the Company had federal net operating loss, or NOL, carry forwards of $33.5 million available to reduce future taxable income, if any. The NOL carry forwards prior to January 1, 2018 of $28.7 million will begin to expire in 2033. The NOL carry forwards incurred post December 31, 2017 of $4.8 million will carry forward indefinitely. As of December 31, 2018, the Company had federal and state research and development credits of $1.8 million and $0.7 million, respectively. The federal research and development credits will begin to expire in 2031. The state research and development credit will carry forward indefinitely. Internal Revenue Code (“IRC”) Section 382 and similar California rules place a limitation on the amount of taxable income that can be offset by NOL and credit carry forwards after a change in control. Generally, after a control change, a corporation cannot deduct NOL or credit carry forwards in excess of the Section 382 limitations. Although the Company has not completed an analysis under Section 382 of the Code since the year ended December 31, 2012, it believes that it is unlikely that the utilization of the NOLs and tax credit carry forwards will be substantially limited. The tax return years 2014 through 2018 remain open to examination by the major domestic taxing jurisdictions to which the Company is subject. Net operations losses generated on a tax return basis by the Company for calendar years 2013 and 2015 to 2018 remain open to examination by the IRS. Net operating losses generated on state returns by the Company for calendar years 2007 to 2013 and 2015 to 2018 remain open to examination by state authorities. ASC 740-10 requires companies to determine whether it is more likely than not that a tax position will be sustained upon examination by the appropriate taxing authorities. The following table summarizes the activity related to the Company’s gross unrecognized tax benefits (in thousands): Years Ended December 31, 2018 Balance at December 31, 2017 $ 331 Changes related to prior year positions 330 Increases related to current year positions 42 Balance at December 31, 2018 $ 703 The Company’s policy is to record interest related to uncertain tax positions as interest and any penalties as other expense in its statement of operations. As of the date of adoption and through December 31, 2018, the Company did not have any interest and penalties associated with unrecognized tax benefits. |
Note 11 - Related-party Transac
Note 11 - Related-party Transactions | 6 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Dec. 31, 2018 | |
Notes to Financial Statements | ||
Related Party Transactions Disclosure [Text Block] | Note 11. Related-Party Transactions At June 30, 2019, the Company had $5.5 million aggregate principal amount of outstanding convertible notes issued to a significant shareholder. ‘ Note 6 — Term Loans and Convertible Promissory Notes’ . In connection with the Merger, Alliqua’s existing CEO resigned from the company and received severance pay of $1,091,000. As such amounts were accrued by Alliqua prior to the Merger, this severance payment had no impact to our condensed consolidated statement of operations for six months ended June 30, 2019. | Note 11. Related-Party Transactions In March 2018, September 2018, and December 2018, the Company issued Notes to the Company’s majority investors totaling $4.5 million as of December 31, 2018. These Notes accrue simple interest on the outstanding principal amount at the rate of 8% per annum. As of December 31, 2018, accrued interest on the Notes was $126,000 — for further details see the section above titled ‘Note 5 — Term Loans and Convertible Promissory Notes’ . |
Note 12 - Employee Benefit Plan
Note 12 - Employee Benefit Plan | 12 Months Ended |
Dec. 31, 2018 | |
Notes to Financial Statements | |
Pension and Other Postretirement Benefits Disclosure [Text Block] | Note 12. Employee Benefit Plan The Company has established a 401(k) Plan (the “401(k) Plan”) that permits participants to make contributions by salary deduction pursuant to Section 401(k) of the IRC. The Company may, at its discretion, make matching contributions to the 401(k) Plan. The Company has made no contributions to the 401(k) Plan since its inception. The Company makes a nonelective 401(k) safe harbor contribution on behalf of each employee equal to 3% of their annual salary. The Company’s non-elective safe harbor contributions totaled $54,000 and $49,000 for the years ended December 31, 2017 and 2018, respectively. |
Note 12 - Subsequent Events
Note 12 - Subsequent Events | 6 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Dec. 31, 2018 | |
Notes to Financial Statements | ||
Subsequent Events [Text Block] | Note 12. Subsequent Events In July 2019, affiliates of Domain Partners, LLC, a significant shareholder of the Company, purchased from the Company $600,000 aggregate principal amount of Notes. The proceeds from the issuance of the Notes will be used for general corporate purposes and working capital. These Notes accrue simple interest on the outstanding principal amount at a rate of 8% per annum and mature one year from the date of issuance. On August 1, 2019 and August 2, 2019, the Company’s board of directors and a majority of the Company’s stockholders, respectively, approved a reverse stock split at a range of between 1-for-2 and 1-for-10, with the final exchange ratio to be determined by the board of directors, which as of the date of filing has not yet occurred. The share and per share information contained in the financial statements and footnotes do not reflect the impact of any such reverse stock split. In August 2019, the Company and Oxford agreed to amend the Loan Agreement pursuant to a ninth amendment to the Loan Agreement. The ninth amendment provides for two additional months of interest-only payments by the Company, contingent upon the completion of certain financing events by specified dates. The ninth amendment also clarifies that the secured funds will be released by Oxford upon the receipt by the Company of net proceeds of at least $10 million from the issuance and sale of its equity securities. | Note 13. Subsequent Events In January 2019, the Company and Oxford Finance agreed to amend the debt agreement. Oxford agreed to 2 months of interest-only payments followed by 8 months of repayments upon delivery by February 1, 2019 of an executed term sheet between the Company and Domain, the Company’s majority investor and an affiliate thereof, that would result in aggregate proceeds to the Company of $20.0 million. The Company was also required to place $200,000 in a segregated bank account that is subject to a blocked control agreement in favor of Oxford. The funds in the segregated account were to be released upon the earlier of, the consummation of a merger by March 31, 2019 or the consummation of the equity financing. The Company recorded the $200,000 as restricted cash in its balance sheet at March 31, 2019. The maturity date of the loans remained unchanged. The amendment fee amounted to $50,000. The amendment was accounted for as a debt modification. Beginning in January 2019, the Company amended the 401(k) Plan to discontinue the nonelective safe harbor contribution on behalf of each employee equal to 3% of their annual salary. In April 2019 and May 2019, the Company’s primary investor agreed to provide the Company with $2.0 million and $0.5 million in the form of Notes to fund the Company’s operations. These notes accrue simple interest on the outstanding principal amount at the rate of 8% per annum and mature on April 26, 2020 and May 29, 2020. In May 2019, the Company and Oxford Finance agreed to a seventh amendment to provide consent to the Merger. This consent amended certain provisions of the term loan to protect Oxford’s rights under the original term loan agreement. The consent allowed Alliqua to be named as an additional borrower. On May 3, 2019 the Company completed its Merger into Alliqua Biomedical Inc. (“Alliqua”). Immediately following the Merger, the combined company’s name was changed from “Alliqua BioMedical, Inc.” to “Adynxx, Inc.” The Merger is intended to qualify for federal income tax purposes as a tax-free reorganization under the provisions of Section 368(a) of the Internal Revenue Code of 1986, as amended. Under the Exchange Ratio formula in the Merger Agreement, as of immediately following the Merger, but excluding the effect of certain financings (as further described in the Merger Agreement), Adynxx equity holders now own approximately 86% of the aggregate number of shares of the combined company and Alliqua equity holders own approximately 14% of the combined company. Subject to the terms and conditions of the Merger Agreement (a) each outstanding share of capital stock of Adynxx, was converted into the right to receive the number of shares of Alliqua’s common stock equal to the Exchange Ratio formula in the Merger Agreement and (b) each outstanding Adynxx stock option, whether vested or unvested, and warrant that has not previously been exercised, was assumed by the post merged company and converted into a stock option or warrant, as the case may be, to purchase shares of the post merged Adynxx Company’s common stock at the Exchange Ratio formula in the Merger Agreement. On May 3, 2019, prior to the closing of the Merger, the $3.0 million of Notes and $203,000 of cumulative accrued interest, was converted into 10,223,996 shares of Series B convertible preferred stock. The Company has evaluated subsequent events through June 7, 2019, the date the financial statements were issued, for appropriate accounting and financial statement disclosures. |
Significant Accounting Policies
Significant Accounting Policies (Policies) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Dec. 31, 2018 | |
Accounting Policies [Abstract] | ||
Use of Estimates, Policy [Policy Text Block] | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent liabilities at the date of the financial statements, and the reported amounts of expenses incurred during the reporting period. Actual results could differ from those estimates and such differences could be material to the Company’s financial position and results of operations. Significant estimates and assumptions include the valuation of equity instruments and equity-linked instruments, including the valuation of the Company’s common stock and the valuation of the Company’s common stock options for purposes of accounting for stock-based compensation, and accruals for clinical trials and the valuation allowances on deferred tax assets. | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent liabilities at the date of the financial statements, and the reported amounts of expenses incurred during the reporting period. Actual results could differ from those estimates and such differences could be material to the Company’s financial position and results of operations. Significant estimates and assumptions include the valuation of equity instruments and equity-linked instruments, including the valuation of the Company’s common stock and the valuation of the Company’s common stock options for purposes of accounting for stock-based compensation, and accruals for clinical trials and the valuation allowances on deferred tax assets. |
Concentration Risk, Credit Risk, Policy [Policy Text Block] | Concentration of Credit Risk and Other Risks and Uncertainties Financial instruments that potentially subject the Company to concentration of credit risk consist of cash and cash equivalents. Cash and cash equivalents are deposited in demand and money market accounts with established financial institutions and, at times, such balances with any one may not The Company operates in a dynamic and highly competitive industry and believes that changes in any of the following areas could have a material adverse effect on the Company's future financial position, results of operations, or cash flows: ability to obtain future financing; advances and trends in new technologies and industry standards; results of clinical trials; regulatory approval and market acceptance of the Company's products; development of sales channels; certain strategic relationships; litigation or claims against the Company based on intellectual property, patent, product, regulatory, or other factors; and the Company's ability to attract and retain employees necessary to support its growth. The Company’s postoperative pain reduction product candidate, brivoligide, is an oligonucleotide. The Company currently uses Nitto-Denko Avecia, Inc. (“Avecia”) as a single supplier for the brivoligide drug substance. There are currently a limited number of oligonucleotide manufacturers with commercial scale capabilities globally. While the Company intends to develop secondary sources for manufacturing of its drug candidates in the future, there can be no June 30, 2019, not At December 31, 2018, three vendors represented 52%, 26% and 15% of total accounts payable. Two of these vendors supported general and administrative activities, primarily associated with the Merger and next round of equity financing, which accounted for 67% of the total accounts payable. The remaining vendor supported clinical study activities. At June 30, 2019, three vendors represented 26%, 22% and 17% of total accounts payable, respectively. Two of these vendors supported general and administrative activities associated with the Merger and the next round of equity financing, which accounted for 44% of the total accounts payable. The remaining supported clinical study activities. | Concentration of Credit Risk and Other Risks and Uncertainties Financial instruments that potentially subject the Company to concentration of credit risk consist of cash and cash equivalents. Cash and cash equivalents are deposited in demand and money market accounts with established financial institutions and, at times, such balances with any one financial institution may be in excess of the Federal Deposit Insurance Corporation insured limits. To date, the Company has not experienced any losses on its deposits of cash and cash equivalents. The Company operates in a dynamic and highly competitive industry and believes that changes in any of the following areas could have a material adverse effect on the Company’s future financial position, results of operations, or cash flows: ability to obtain future financing; advances and trends in new technologies and industry standards; results of clinical trials; regulatory approval and market acceptance of the Company’s products; development of sales channels; certain strategic relationships; litigation or claims against the Company based on intellectual property, patent, product, regulatory, or other factors; and the Company’s ability to attract and retain employees necessary to support its growth. The Company’s postoperative pain reduction product candidate, brivoligide, is an oligonucleotide. The Company currently uses Avecia as a single supplier for the brivoligide drug substance. There are currently a limited number of oligonucleotide manufacturers with commercial scale capabilities globally. While the Company intends to develop secondary sources for manufacturing of its drug candidates in the future, there can be no assurance that it will be able to do so on commercially reasonable terms, or at all. Any interruption in the supply of this key material could significantly delay the research and development process or increase the expenses for development and commercialization of the Company’s product candidates. The quality of materials can be critical to the performance of a drug delivery technology. Therefore, the lack of a reliable source that provides a consistent supply of high quality materials would harm the Company. At December 31, 2018, this vendor’s activity was not material to total accounts payable. At December 31, 2017, two vendors represented 56% and 31%, of total accounts payable. The vendor that represented 56% of the Company’s accounts payable, supported manufacturing activities and the other vendor was associated with clinical study activities. At December 31, 2018, three vendors represented 52%, 26% and 15% of total accounts payable. Two of these vendors supported general and administrative activities, primarily associated with the Merger and next round of equity financing, which accounted for 67% of the total accounts payable. The remaining vendor supported clinical study activities. |
Clinical Trial Accruals, Policy [Policy Text Block] | Clinical Trial Accruals The Company’s clinical trial accruals are based on patient enrollment and related costs at clinical investigator sites as well as for the services received and efforts expended pursuant to contracts with multiple research institutions and contract research organizations that conduct and manage clinical trials on the Company’s behalf. The Company accrues expenses related to clinical trials based on contracted amounts applied to the level of patient enrollment and activity according to the clinical trial protocol. If timelines or contracts are modified based upon changes in the clinical trial protocol or scope of work to be performed, the Company modifies the estimates of accrued expenses accordingly. To date, the Company has had no | Clinical Trial Accruals The Company’s clinical trial accruals are based on patient enrollment and related costs at clinical investigator sites as well as for the services received and efforts expended pursuant to contracts with multiple research institutions and contract research organizations that conduct and manage clinical trials on the Company’s behalf. The Company accrues expenses related to clinical trials based on contracted amounts applied to the level of patient enrollment and activity according to the clinical trial protocol. If timelines or contracts are modified based upon changes in the clinical trial protocol or scope of work to be performed, the Company modifies the estimates of accrued expenses accordingly. To date, the Company has had no significant adjustments to accrued clinical trial expenses. In March 2018, the Company closed its contracts with Premier Research International LLC and CRF Health, Inc. (“Contract Research Organizations or CROs”) upon completion of a Phase 2 clinical trial in March 2018. For the years ended December 31, 2017 and 2018, the Company incurred $6.2 million and $95,000, respectively, of expenses in connection with this clinical study. In November 2018, the Company entered into agreements with PRA Health, Inc. and CRF Health, Inc. (“Contract Research Organizations or CROs”) pursuant to which the CROs agreed to assist the Company with the conduct of a Phase 2 clinical trial. To support additional clinical trial activities the Company also entered into agreements with Premier Research International LLC for biostatistical services, ICON Central Laboratories for laboratory services and Almac Clinical Services for storage and distribution services. In connection with this clinical study, the Company incurred expenses of $0 and $185,000 for the years ended December 31, 2017 and 2018, respectively. |
Cash and Cash Equivalents, Policy [Policy Text Block] | Cash and Cash Equivalents The Company considers all highly liquid investments purchased with a maturity of three | Cash and Cash Equivalents The Company considers all highly liquid investments purchased with a maturity of three months or less on the date of acquisition to be cash and cash equivalents. |
Property, Plant and Equipment, Policy [Policy Text Block] | Property and Equipment, Net Property and equipment are stated at cost, net of accumulated depreciation. Depreciation is computed using a straight-line method over the estimated useful lives of the assets, generally three five Expenditures for repairs and maintenance are charged to expense as incurred. Upon disposition of an asset, the cost and related accumulated depreciation are removed from the accounts and the resulting gain or loss is reflected in the statements of operations. | Property and Equipment, Net Property and equipment are stated at cost, net of accumulated depreciation. Depreciation is computed using a straight-line method over the estimated useful lives of the assets, generally three to five years. Leasehold improvements are amortized over the shorter of the estimated useful life of the asset or the remaining term of the lease. Expenditures for repairs and maintenance are charged to expense as incurred. Upon disposition of an asset, the cost and related accumulated depreciation are removed from the accounts and the resulting gain or loss is reflected in the statements of operations. |
Impairment or Disposal of Long-Lived Assets, Including Intangible Assets, Policy [Policy Text Block] | Impairment of Long-Lived Assets The Company’s long-lived assets and other assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. Recoverability of an asset to be held and used is measured by a comparison of the carrying amount of an asset to the future undiscounted cash flows expected to be generated by the asset. If such asset is considered to be impaired, the impairment to be recognized is measured as the amount by which the carrying amount of the asset exceeds its fair value. As of December 31, 2018 and June 30, 2019, the Company had not experienced any impairment losses on its long-lived assets. | Impairment of Long-Lived Assets The Company’s long-lived assets and other assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. Recoverability of an asset to be held and used is measured by a comparison of the carrying amount of an asset to the future undiscounted cash flows expected to be generated by the asset. If such asset is considered to be impaired, the impairment to be recognized is measured as the amount by which the carrying amount of the asset exceeds its fair value. As of December 31, 2017 and 2018, the Company had not experienced any impairment losses on its long-lived assets. |
Cash and Cash Equivalents, Restricted Cash and Cash Equivalents, Policy [Policy Text Block] | Restricted Cash At December 31, 2018 and June 30, 2019, the Company had $55,000 restricted and held by a bank as collateral for a letter of credit provided to the Company’s facility landlord. In addition, as of June 30, 2019, the Company had $200,000 restricted from withdrawal and held by a bank in the form of a secured money market account as collateral for Oxford in conjunction with a debt amendment that occurred in January 2019. | Restricted Cash As of December 31, 2017 and 2018, the Company had $55,000 restricted and held by a bank as collateral for a letter of credit provided to the Company’s facility landlord. |
Share-based Payment Arrangement [Policy Text Block] | Stock-Based Compensation Stock-based compensation is measured at the grant date based on the fair value of the award. The fair value of the award that is ultimately expected to vest is recognized as expense on a straight-line basis over the requisite service period, which is generally the vesting period. The Company recognizes forfeitures as they occur. The Company uses the Black-Scholes option-pricing model (the "Black-Scholes model") as the method for determining the estimated fair value of stock options. Expected Term— Expected Volatility— Expected Dividend— no Risk-Free Interest Rate— zero | Stock-Based Compensation Stock-based compensation is measured at the grant date based on the fair value of the award. The fair value of the award that is ultimately expected to vest is recognized as expense on a straight-line basis over the requisite service period, which is generally the vesting period. The Company recognizes forfeitures as they occur. The Company uses the Black-Scholes option-pricing model (the “Black-Scholes model”) as the method for determining the estimated fair value of stock options. Expected Term — The expected term represents the period that the Company’s stock-based awards are expected to be outstanding and is determined using the simplified method. Expected Volatility — Expected volatility is estimated using comparable public companies’ volatility for similar terms. Expected Dividend — The Black-Scholes model calls for a single expected dividend yield as an input. The Company has never paid dividends and has no plans to pay dividends. Risk-Free Interest Rate — The risk-free interest rate used in the Black-Scholes model is based on the U.S. Treasury zero-coupon issues in effect at the time of grant for periods corresponding with the expected term of the option. |
Research and Development Expense, Policy [Policy Text Block] | Research and Development Research and development expenses consist of personnel costs, including salaries, benefits and stock-based compensation, preclinical studies, clinical studies performed by contract research organizations (“CROs”), materials and supplies, licenses and fees, and overhead allocations consisting of various administrative and facilities related costs. The Company charges research and development costs, including clinical study costs, to expense when incurred. | Research and Development Research and development expenses consist of personnel costs, including salaries, benefits and stock-based compensation, preclinical studies, clinical studies performed by Contract Research Organizations (or “CROs”), materials and supplies, licenses and fees, and overhead allocations consisting of various administrative and facilities related costs. The Company charges research and development costs, including clinical study costs, to expense when incurred. |
Collaborative Arrangement, Accounting Policy [Policy Text Block] | Collaboration Agreement In June 2018, the Company entered into a collaboration agreement with twoXAR, an artificial intelligence-driven drug discovery company, in order to identify potential product candidates for the treatment of endometriosis. In May 2019, the Company made a collaboration initiation payment of $75,000, which was charged to research and development expenses for the six months ended June 30, 2019. In June 2019, Adynxx received an initial set of candidate predictions from twoXAR. The Company has initiated a review of the potential products to determine if any are viable candidates for further research and development. | Collaboration Agreement In June 2018, the Company entered into a collaboration agreement with twoXAR, an artificial intelligence-driven drug discovery company, in order to identify potential product candidates for the treatment of endometriosis. Through December 31, 2018, the Company was not obligated to make any payments under the terms of the collaboration agreement. |
Grant Reimbursement, Policy [Policy Text Block] | Grant Reimbursements In December 2018, the Company received a Notice of Award from the National Institute on Drug Abuse (“NIDA”), part of the National Institutes of Health (“NIH”), to support the clinical development of its lead product candidate, brivoligide. NIH grants provide funds for certain types of expenditures in connection with research and development activities over a contractually defined period. The maximum funding expected to be available under this grant for qualified expenditures over the two-year period through December 2020 is approximately $5.7 million. On January 1, 2019, the Company adopted Accounting Standards Update (ASU) 2018-08, “Clarifying the Scope and the Accounting Guidance for Contributions Received and Contributions Made.” Based on this guidance, the Company determined that grant payments received met the definition of a ‘conditional contribution’ (versus an exchange contract) because (i) the Company has limited discretion in the way the funds may be spent, which creates a barrier to entitlement, and (ii) the grant contains provisions that release the awarding agency from the obligation to transfer funds that are not expended at the time the award is terminated. The Company recognizes grant reimbursements as a contra operating expense and reflects this as a component of its loss from operations in the period during which the qualifying expenses are incurred and the related services rendered, provided that the applicable performance obligations have been met. For the six months ended June 30, 2019, the Company incurred qualified expenses and recognized $1,198,000 of grant reimbursements. | Grant Reimbursements In December 2018, the Company received a Notice of Award from the National Institute on Drug Abuse (“NIDA”), part of the National Institutes of Health (“NIH”), to support the clinical development of its lead product candidate, brivoligide. NIH grants provide funds for certain types of expenditures in connection with research and development activities over a contractually defined period. The maximum funding expected to be available under this grant for qualified expenditures over the two year period through December 2020 is approximately $5.7 million. As of December 31, 2018, the Company had not incurred qualified expenses. |
Income Tax, Policy [Policy Text Block] | Income Taxes The Company accounts for income taxes using the asset and liability method whereby deferred tax asset and liability account balances are determined based on differences between the financial reporting and tax basis of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company provides a valuation allowance, if necessary, to reduce deferred tax assets to their estimated realizable value. In evaluating the ability to recover its deferred income tax assets, the Company considers all available positive and negative evidence, including its operating results, ongoing tax planning, and forecasts of future taxable income on a jurisdiction-by-jurisdiction basis. In the event the Company determines that it would be able to realize its deferred income tax assets in the future in excess of their net recorded amount, it would make an adjustment to the valuation allowance, which would reduce the provision for income taxes. Conversely, in the event that all or part of the net deferred tax assets are determined not The Company recognizes the tax benefit from uncertain tax positions in accordance with GAAP, which prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of uncertain tax positions taken or expected to be taken in a company's tax return. | Income Taxes The Company accounts for income taxes using the asset and liability method whereby deferred tax asset and liability account balances are determined based on differences between the financial reporting and tax basis of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company provides a valuation allowance, if necessary, to reduce deferred tax assets to their estimated realizable value. In evaluating the ability to recover its deferred income tax assets, the Company considers all available positive and negative evidence, including its operating results, ongoing tax planning, and forecasts of future taxable income on a jurisdiction-by-jurisdiction basis. In the event the Company determines that it would be able to realize its deferred income tax assets in the future in excess of their net recorded amount, it would make an adjustment to the valuation allowance, which would reduce the provision for income taxes. Conversely, in the event that all or part of the net deferred tax assets are determined not to be realizable in the future, an adjustment to the valuation allowance would be charged to earnings in the period such determination is made. The Company recognizes the tax benefit from uncertain tax positions in accordance with GAAP, which prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of uncertain tax positions taken or expected to be taken in a company’s tax return. |
Convertible Preferred Stock Warrants, Policy [Policy Text Block] | Convertible Preferred Stock Warrants At December 31, 2018, freestanding warrants to acquire shares of convertible preferred stock were classified as liabilities on the accompanying balance sheet. These warrants were subject to remeasurement at fair value at each balance sheet date, and any change in fair value is recognized as a component of other income or expense. In connection with the Merger, the warrants were exchanged into warrants that no longer met the definition of a derivative and thus, $234,000 of warrant liabilities was reclassified into equity during the six months ended June 30, 2019. | Convertible Preferred Stock Warrants Freestanding warrants to acquire shares of convertible preferred stock are classified as liabilities on the accompanying balance sheets. These warrants are subject to remeasurement at fair value at each balance sheet date, and any change in fair value is recognized as a component of other income or expense. The Company will continue to adjust the carrying values of freestanding warrants classified as liabilities for changes in fair value until the earlier of the exercise or expiration of the warrants or the completion of a liquidation event, including the completion of an initial public offering. |
Debt Modifications and Extinguishments, Policy [Policy Text Block] | Debt Modifications and Extinguishments When the Company modifies debt, it does so in accordance with Accounting Standards Codification (“ASC”) 470 50, Debt: Modifications and Extinguishments October 2018 March 2018 September 2018 $11,000 October 2018. not | Debt Modif ications and Extinguishments When the Company modifies debt, it does so in accordance with Accounting Standards Codification (“ASC”) 470-50, Debt: Modifications and Extinguishments , which requires modification to debt instruments to be evaluated to assess whether the modifications are considered “substantial modifications”. A substantial modification of terms shall be accounted for like an extinguishment. Based on the guidance relied upon and the analysis performed, the Company determined that the October 2018 modification of the March 2018 and September 2018 Notes, to add an additional conversion option in the event of a reverse merger, was considered to be a “substantial modification”. As a result, it treated this modification as an ‘extinguishment’ of those debts and recognized $11,000 of net gain from this debt extinguishment in other income. All other changes to debt provisions were not considered substantial and were treated as debt modifications. |
Derivatives, Policy [Policy Text Block] | Derivative Instruments ASC 815-15, Derivatives and Hedging: Embedded Derivatives , generally provides three criteria that, if met, require companies to bifurcate conversion options from their host instruments and account for them as freestanding derivative financial instruments. These three criteria include circumstances in which (a) the economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics and risks of the host contract, (b) the hybrid instrument that embodies both the embedded derivative instrument and the host contract is not re-measured at fair value under otherwise applicable generally accepted accounting principles with changes in fair value reported in earnings as they occur and (c) a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument subject to the requirement of ASC 815. At December 31, 2018 and June 30, 2019, the Company maintained outstanding Notes which contained various embedded derivative features. In particular, these Notes contained the following features: (1) A share settled redemption in a qualified preferred stock financing; and (2) The right to an accelerated cash repayment in the event of a change in control. These embedded features were not considered clearly and closely related to the debt host, therefore, they were bifurcated and accounted for separately from the debt host as a derivative liability. Derivative financial liabilities are initially recorded at fair value, with gains and losses arising from changes in fair value recognized in the statement of operations at each period end while such instruments are outstanding. As of December 31, 2018 and June 30, 2019, the Company determined that there was no fair value associated with the embedded derivatives that remained with the outstanding convertible notes. See ‘Note 6 — Term Loans and Convertible Promissory Notes’ for further discussion of the Notes and the bifurcated derivative liability. | Derivative Instruments ASC 815-15, Derivatives and Hedging: Embedded Derivatives , generally provides three criteria that, if met, require companies to bifurcate conversion options from their host instruments and account for them as freestanding derivative financial instruments. These three criteria include circumstances in which (a) the economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics and risks of the host contract, (b) the hybrid instrument that embodies both the embedded derivative instrument and the host contract is not re-measured at fair value under otherwise applicable generally accepted accounting principles with changes in fair value reported in earnings as they occur and (c) a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument subject to the requirement of ASC 815. The Company issued certain Notes in March 2018, September 2018, and December 2018, which contained various embedded derivative features. In particular, these Notes contained the following features: (1) (2) These embedded features were not considered clearly and closely related to the debt host, therefore, they were bifurcated and accounted for separately from the debt host as a derivative liability. Derivative financial liabilities are initially recorded at fair value, with gains and losses arising from changes in fair value recognized in the statement of operations at each period end while such instruments are outstanding. In October 2018, the Company modified the March 2018 and September 2018 Notes to add an additional conversion feature. The Company determined this was a “substantial modification” as defined in ASC 470-50 ‘Debt: Modifications and Extinguishments’ . As a result, these Notes were accounted for as an ‘extinguishment’ of the debt and related derivative liability. As of December 31, 2018, the Company determined that there was no fair value associated with the embedded derivatives that remained with the modified March 2018, the modified September 2018 and December 2018 Notes. See ‘Note 5 — Term Loans and Convertible Promissory Notes’ for further discussion of the Notes and the bifurcated derivative liability. |
Fair Value of Financial Instruments, Policy [Policy Text Block] | Fair Value of Financial Instruments ASC 820-10, Fair Value Measurement , provides a framework for measuring fair value under GAAP and requires expanded disclosures regarding fair value measurements. The standard defines fair value as an exit price, representing the amount that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants. The standard also establishes a fair value hierarchy, which prioritizes the inputs used in measuring fair value. The standard describes three levels of inputs that may be used to measure fair value: Level 1 — Unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access as of the measurement date. Level 2 — Inputs other than quoted prices included within Level 1 that are directly observable for the asset or liability or indirectly observable through corroboration with observable market data. Level 3 — Unobservable inputs for the asset or liability only used when there is little, if any, market activity for the asset or liability at the measurement date. This hierarchy requires the use of observable market data when available and to minimize the use of unobservable inputs when determining fair value. The following table presents the Company’s fair value hierarchy for its warrant liability measured at fair value on a recurring basis at December 31, 2018 (in thousands): As of December 31, 2018 Level 1 Level 2 Level 3 Total Financial liabilities Warrant liability $ — $ — $ $ Total financial liabilities $ — $ — $ $ The Level 3 derivative at December 31, 2018 consisted of a warrant liability of Private Adynxx that, at December 31, 2018, was exercisable into preferred shares that were potentially redeemable. In connection with the Merger, the warrants were exchanged into warrants that no longer met the definition of a derivative and thus, the balance was reclassified into equity during the six months ended June 30, 2019. The change in fair value of the warrant liability for the six months ended June 30, 2018 and 2019 are as follows (in thousands): Six Months Ended June 30, 2018 2019 Fair value, beginning of period $ $ Change in fair value of preferred stock warrants — Exchange of warrants upon Merger — ) Fair value at end of period $ $ — The carrying amounts reported in the accompanying balance sheets for cash and cash equivalents, accounts payable and accrued liabilities approximate their fair value due to their short maturities. The fair value of the Company’s term loan is based on the borrowing rate currently available to the Company for borrowings with similar terms and maturity and approximates its carrying value. Derivative liability instruments are considered Level 3 when their fair values are determined using pricing models, discounted cash flow methodologies, or similar techniques, and at least one significant model assumption or input is unobservable. Level 3 liability instruments consist of the preferred stock warrant liability and derivative liability, for both of which there is no observable market data for the determination of fair value and requires significant management judgment and estimation. While the Company’s Notes contain embedded derivative liabilities, the Company determined that the fair value of these liabilities were zero at December 31, 2018 and June 30, 2019. See ‘ Note 6 — Term Loans and Convertible Promissory Notes’ for further discussion on the derivative liability activity. The change in fair value of the derivative liability relating to the Notes for the six months ended June 30, 2018 and 2019 is summarized below (in thousands): Six Months Ended June 30, 2018 2019 Fair value, beginning of period $ — $ — Embedded derivative liability from the issuance of Notes — Change in value of embedded derivatives ) — Fair value at end of period $ $ — | Fair Value of Financial Instruments ASC 820-10, Fair Value Measurement , provides a framework for measuring fair value under GAAP and requires expanded disclosures regarding fair value measurements. The standard defines fair value as an exit price, representing the amount that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants. The standard also establishes a fair value hierarchy, which prioritizes the inputs used in measuring fair value. The standard describes three levels of inputs that may be used to measure fair value: Level 1 — Unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access as of the measurement date. Level 2 — Inputs other than quoted prices included within Level 1 that are directly observable for the asset or liability or indirectly observable through corroboration with observable market data. Level 3 — Unobservable inputs for the asset or liability only used when there is little, if any, market activity for the asset or liability at the measurement date. This hierarchy requires the use of observable market data when available and to minimize the use of unobservable inputs when determining fair value. The following tables present the Company’s fair value hierarchy for all of its financial instruments measured at fair value on a recurring basis as of December 31, 2017 and December 31, 2018 (in thousands): As of December 31, 2017 Level 1 Level 2 Level 3 Total Financial liabilities: Warrant liability $ — $ — $ 42 $ 42 Total financial liabilities $ — $ — $ 42 $ 42 As of December 31, 2018 Financial liabilities: Level 1 Level 2 Level 3 Total Warrant liability $ — $ — $ 140 $ 140 Total financial liabilities $ — $ — $ 140 $ 140 The carrying amounts reported in the accompanying balance sheets for cash and cash equivalents, accounts payable and accrued liabilities approximate their fair value due to their short maturities. The fair value of the Company’s term loan is based on the borrowing rate currently available to the Company for borrowings with similar terms and maturity and approximates its carrying value. Derivative liability instruments are considered Level 3 when their fair values are determined using pricing models, discounted cash flow methodologies, or similar techniques, and at least one significant model assumption or input is unobservable. Level 3 liability instruments consist of the preferred stock warrant liability and derivative liability, for both of which there is no observable market data for the determination of fair value and requires significant management judgment and estimation. The fair value of the warrant liability was determined using the Black-Scholes model (see ‘Note 8 — Warrants’ for a further discussion of the preferred stock warrants). The change in fair value of the preferred stock warrant liability is summarized below (in thousands): Years Ended December 31, 2017 2018 Fair value, beginning of period $ 54 $ 42 Preferred stock warrants – exercised (8) — Change in fair value of preferred stock warrants (4) 98 Fair value at end of period $ 42 $ 140 The fair value of the embedded derivative liability related to the Company’s Notes was determined using a bond plus option model. As of December 31, 2018, the Company determined that there was no fair value remaining for the embedded derivatives associated with the modified March 2018, modified September 2018 and December 2018 Notes. See ‘Note 5 — Term Loans and Convertible Promissory Notes’ for further discussion on the derivative liability activity. The change in fair value of the derivative liability relating to the Notes is summarized below (in thousands): Years Ended December 31, 2017 2018 Fair value, beginning of period $ — $ — Embedded derivative liability from the issuance of Notes — 864 Change in value of embedded derivatives — (211) Termination of the embedded derivative liability due to the extinguishment of the related Notes — (653) Fair value at end of period $ — $ — |
Discontinued Operations, Policy [Policy Text Block] | Discontinued Operations Discontinued operations represent the activities of the AquaMed business between the date of the Merger and the date of the spin-off. See ‘ Note 3 no June 30, 2019. | |
New Accounting Pronouncements, Policy [Policy Text Block] | Recently Adopted Accounting Pronouncements Lease Accounting In February 2016, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2016-02, Leases (Topic 842) (“ASU 2016-02”). ASU 2016-02 is intended to improve financial reporting of leasing transactions by requiring organizations that lease assets to recognize assets and liabilities for the rights and obligations created by leases that extend more than twelve months on the balance sheet. This accounting update also requires additional disclosures surrounding the amount, timing, and uncertainty of cash flows arising from leases. ASU 2016-02 is effective for financial statements issued for annual and interim periods beginning after December 15, 2018 for public business entities. A modified retrospective transition approach is required, applying the new standard to all leases existing at the date of initial application. An entity may choose to use either (1) its effective date or (2) the beginning of the earliest comparative period presented in the financial statements as its date of initial application. The Company adopted the new standard on January 1, 2019 and used the effective date as its date of initial application. Consequently, the Company has not adjusted prior period amounts. The Company has elected the package of practical expedients permitted in ASC Topic 842. Accordingly, the Company accounted for its existing operating leases as operating leases under the new guidance, without reassessing (a) whether the contracts contain a lease under ASC Topic 842, (b) whether classification of the operating leases would be different in accordance with ASC Topic 842, or (c) whether the unamortized initial direct costs would have met the definition of initial direct costs in ASC Topic 842 at lease commencement. The most significant impact from the adoption of this standard was the recognition of right-of-use, or ROU, assets and lease obligations on the balance sheet for operating leases. This standard did not have a material impact on the Company’s cash flows from operations and operating results. As a result of the adoption of the new lease accounting guidance, the Company recognized on January 1, 2019 (a) a lease liability of approximately $227,000, which represents the present value of the remaining lease payments of approximately $239,000, discounted using the Company’s incremental borrowing rate of 9.41%, and (b) a right-of-use asset of approximately $227,000 which represents the lease liability of $227,000. The ROU asset is being amortized over the remaining term of the lease of twelve months from January 1, 2019. Recent Accounting Pronouncements Not Yet Effective In August 2018, the FASB issued No. ASU 2018-13, Changes to the Disclosure Requirements for Fair Value Measurement (Topic 820). This ASU eliminates, adds and modifies certain disclosure requirements for fair value measurements as part of its disclosure framework project. This ASU is effective for fiscal years beginning after December 15, 2019, including interim periods within that fiscal year, with early adoption permitted. The Company is currently assessing whether these amendments will have a material effect on its financial statements. In August 2018, the FASB issued ASU 2018-15, Intangibles — Goodwill and Other — Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract, (“ASU 2018-15”). The amendments in this update align the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license). The accounting for the service element of a hosting arrangement that is a service contract is not affected by the amendments in this update. The new standard will be effective beginning January 1, 2020 and early adoption is permitted. The Company is currently assessing whether these amendments will have a material effect on its financial statements. | Recently Adopted Accounting Pronouncements Restricted Cash In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows: Restricted Cash. This ASU requires changes in restricted cash during the period to be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. If cash, cash equivalents and restricted cash are presented in more than one line item on the balance sheet, the new guidance requires a reconciliation of the total in the statement of cash flows to the related captions in the balance sheet. This guidance is effective for fiscal periods beginning after December 15, 2017 and interim periods within that fiscal year, with early adoption permitted. The amendments in this ASU should be applied retrospectively to all periods presented. The Company adopted the guidance on a retrospective basis on January 1, 2018 and the beginning and ending of cash and cash equivalents for all periods presented in our statements of cash flows include restricted cash. Non-employee Share-Based Payment Accounting In June 2018, FASB issued ASU No. 2018-07, “Compensation — Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting” (“ASU 2018-07”). This new guidance changes the accounting for non-employee share-based payments to align with the accounting for employee stock compensation. The Company early adopted the guidance as of January 1, 2018 and the impact to its financial statements was not material. Recent Accounting Pronouncements Not Yet Effective Lease Accounting In February 2016, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2016-02. This standard introduces the new leases standard that applies a right-of-use (“ROU”) model and requires a lessee to record, for all leases with a lease term of more than 12 months, an asset representing its right to use the underlying asset and a liability to make lease payments. For leases with a term of 12 months or less, a practical expedient is available whereby a lessee may elect, by class of underlying asset, not to recognize an ROU asset or lease liability. At inception, lessees must classify all leases as either finance or operating based on five criteria. Balance sheet recognition of finance and operating leases is similar, but the pattern of expense recognition in the income statement, as well as the effect on the statement of cash flows, differs depending on the lease classification. This ASU is effective for public entities for annual periods beginning after December 15, 2018, and interim periods within those years. Early adoption is permitted for all entities. The Company is currently assessing whether these amendments will have a material effect on its financial statements. In August 2018, the FASB issued No. ASU 2018-13, Changes to the Disclosure Requirements for Fair Value Measurement (Topic 820). This ASU eliminates, adds and modifies certain disclosure requirements for fair value measurements as part of its disclosure framework project. This ASU is effective for fiscal years beginning after December 15, 2019, including interim periods within that fiscal year, with early adoption permitted. The Company is currently assessing whether these amendments will have a material effect on its financial statements. |
Note 2 - Summary of Significa_2
Note 2 - Summary of Significant Accounting Policies (Tables) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Dec. 31, 2018 | |
Notes Tables | ||
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Table Text Block] | As of December 31, 2018 Level 1 Level 2 Level 3 Total Financial liabilities Warrant liability $ - $ - $ 140 $ 140 Total financial liabilities $ - $ - $ 140 $ 140 | As of December 31, 2017 Level 1 Level 2 Level 3 Total Financial liabilities: Warrant liability $ — $ — $ 42 $ 42 Total financial liabilities $ — $ — $ 42 $ 42 As of December 31, 2018 Financial liabilities: Level 1 Level 2 Level 3 Total Warrant liability $ — $ — $ 140 $ 140 Total financial liabilities $ — $ — $ 140 $ 140 |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Table Text Block] | Six Months Ended June 30, 2018 2019 Fair value, beginning of period $ $ Change in fair value of preferred stock warrants — Exchange of warrants upon Merger — ) Fair value at end of period $ $ — Six Months Ended June 30, 2018 2019 Fair value, beginning of period $ — $ — Embedded derivative liability from the issuance of Notes — Change in value of embedded derivatives ) — Fair value at end of period $ $ — | Years Ended December 31, 2017 2018 Fair value, beginning of period $ 54 $ 42 Preferred stock warrants – exercised (8) — Change in fair value of preferred stock warrants (4) 98 Fair value at end of period $ 42 $ 140 Years Ended December 31, 2017 2018 Fair value, beginning of period $ — $ — Embedded derivative liability from the issuance of Notes — 864 Change in value of embedded derivatives — (211) Termination of the embedded derivative liability due to the extinguishment of the related Notes — (653) Fair value at end of period $ — $ — |
Note 4 - Property and Equipme_2
Note 4 - Property and Equipment, Net (Tables) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Dec. 31, 2018 | |
Notes Tables | ||
Property, Plant and Equipment [Table Text Block] | December 31, 2018 June 30, 2019 Furniture and fixtures $ $ Office equipment Computer equipment Laboratory equipment Total property and equipment Less accumulated depreciation ) ) Property and equipment, net $ $ | As of December 31, 2017 2018 Furniture and fixtures $ 29 $ 29 Office equipment 2 2 Computer equipment 24 18 Laboratory equipment 2 2 Total property and equipment 57 51 Less accumulated depreciation (44) (41) Property and equipment, net $ 13 $ 10 |
Note 4 - Accrued Liabilities (T
Note 4 - Accrued Liabilities (Tables) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Dec. 31, 2018 | |
Notes Tables | ||
Schedule of Accrued Liabilities [Table Text Block] | December 31, 2018 June 30, 2019 Payroll and related expenses $ $ Accrued term loan final payment Accrued clinical trial expense — Professional fees and other costs Total accrued liabilities $ $ | As of December 31, 2017 2018 Payroll and related expenses $ 273 $ 241 Accrued term loan final payment 197 421 Accrued clinical trial expense 654 — Professional fees and other costs 34 195 Total accrued liabilities $ 1,158 $ 857 |
Note 5 - Other Balance Sheet _2
Note 5 - Other Balance Sheet Information (Tables) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Dec. 31, 2018 | |
Notes Tables | ||
Schedule of Prepaid and Other Current Assets [Table Text Block] | December 31, 2018 June 30, 2019 Prepaid clinical trial expenses $ $ Equity issuance costs — Prepaid insurance — Other prepaid expenses Total prepaid and other current assets $ $ | |
Schedule of Accrued Liabilities [Table Text Block] | December 31, 2018 June 30, 2019 Payroll and related expenses $ $ Accrued term loan final payment Accrued clinical trial expense — Professional fees and other costs Total accrued liabilities $ $ | As of December 31, 2017 2018 Payroll and related expenses $ 273 $ 241 Accrued term loan final payment 197 421 Accrued clinical trial expense 654 — Professional fees and other costs 34 195 Total accrued liabilities $ 1,158 $ 857 |
Note 6 - Term Loans and Conve_2
Note 6 - Term Loans and Convertible Promissory Notes (Tables) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Dec. 31, 2018 | |
Notes Tables | ||
Schedule of Long-term Debt Instruments [Table Text Block] | Year Ending, December 31, 2019 Total principal payments $ 3,833 | |
Convertible Debt [Table Text Block] | December 31, 2018 June 30, 2019 Convertible note payable, due on March 29, 2019 $ $ — Convertible note payable, due on September 27, 2019 — Convertible note payable, due on December 21, 2019 Convertible note payable, due on March 29, 2020 — Convertible note payable, due on April 26, 2020 — Convertible note payable, due on May 29, 2020 — Total $ $ | As of December 31, 2017 2018 Convertible note payable, due on March 29, 2019, interest at 8.0% p.a $ — $ 1,500 Convertible note payable, due on September 27, 2019, interest at 8.0% p.a — 1,500 Convertible note payable, due on December 21, 2019, interest at 8.0% p.a — 1,500 Total $ — $ 4,500 |
Note 6 - Commitments and Cont_2
Note 6 - Commitments and Contingencies (Tables) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Dec. 31, 2018 | |
Notes Tables | ||
Lessee, Operating Lease, Liability, Maturity [Table Text Block] | Period ending December 31 Future Commitments 2019 (remaining 6 months) $ 232 2020 227 2021 232 2022 236 2023 80 Total future minimum lease payments 1,007 Less: imputed interest (167 ) Total $ 840 | Future Year ending December 31 Commitments 2019 $ 239 Total $ 239 |
Note 7 - Leases (Tables)
Note 7 - Leases (Tables) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Dec. 31, 2018 | |
Notes Tables | ||
Lessee, Operating Lease, Liability, Maturity [Table Text Block] | Period ending December 31 Future Commitments 2019 (remaining 6 months) $ 232 2020 227 2021 232 2022 236 2023 80 Total future minimum lease payments 1,007 Less: imputed interest (167 ) Total $ 840 | Future Year ending December 31 Commitments 2019 $ 239 Total $ 239 |
Note 7 - Stockholders' Deficit
Note 7 - Stockholders' Deficit (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Notes Tables | |
Schedule of Stockholders Equity [Table Text Block] | As of December 31, 2017 2018 Series A convertible preferred stock Series B convertible preferred stock Warrants for Series A convertible preferred stock Common stock options issued and outstanding Total |
Note 8 - Warrants (Tables)
Note 8 - Warrants (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Notes Tables | |
Schedule of Stockholders' Equity Note, Warrants or Rights [Table Text Block] | Issuance Date Expiration Date Exercise Price Number of Shares (in thousands) November, 2015 November, 2025 January, 2016 January, 2026 Total |
Warrants For Series A Convertible Preferred Stock [Member] | |
Notes Tables | |
Fair Value Measurement Inputs and Valuation Techniques [Table Text Block] | As of December 31, 2017 2018 Risk-free interest rate 2.28 % 2.56% – 2.59 % Remaining contractual life (in years) 7.92 – 8.08 6.92 – 7.08 Dividend yield — — Expected volatility 71.00 % 76.84 % |
Note 10 - Stock Options (Tables
Note 10 - Stock Options (Tables) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Dec. 31, 2018 | |
Notes Tables | ||
Share-based Payment Arrangement, Option, Activity [Table Text Block] | Number of Weighted Weighted Average Remaining Intrinsic Outstanding, December 31, 2018 $ Alliqua options assumed in Merger 58 Exercised — — Cancelled — — Outstanding, June 30, 2019 $ $ Exercisable, June 30, 2019 $ $ | Outstanding Options Weighted- Weighted- Average Average Remaining Shares Exercise Contractual Aggregate Available Options Price Life Intrinsic For Grant Outstanding Per Share (in years) Value (a) Balance at December 31, 2016 5 $ 0.10 9.4 Balance at December 31, 2017 5 19,222 $ 8.4 $ 6,639 Balance at December 31, 2018 5 $ 7.4 $ 6,956 Vested and expected to vest as of December 31, 2018 $ 7.4 $ 6,956 Exercisable at December 31, 2018 $ 7.4 $ 4,119 (a) The aggregate intrinsic value is calculated as the difference between the stock option exercise price and the estimated fair value of the Company’s common stock of $0.46 and $0.44 per share as of December 31, 2018 and 2017. |
Share-based Payment Arrangement, Option, Exercise Price Range [Table Text Block] | Options Outstanding Options Exercisable Range of Exercise Price Weighted Average Exercise Price Outstanding Number of Options Weighted Average Exercise Price Weighted Average Remaining Life In Years Exercisable Number of Options $1.11 — $1.38 $ 73 $ 73 1.39 — 3.05 1.39 37 1.39 37 3.06 — 20.99 3.06 580 3.06 362 21.00 — 656.40 289.81 58 289.81 58 $ 24.95 748 $ 530 |
Note 10 - Income Taxes (Tables)
Note 10 - Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Notes Tables | |
Schedule of Deferred Tax Assets and Liabilities [Table Text Block] | As of December 31, 2017 2018 Net operating loss carry forward $ 6,158 $ 7,051 Research and development credits 1,284 1,601 Accruals and reserves 99 142 Fixed assets — 1 Total deferred tax asset 7,541 8,795 Valuation allowance (7,541) (8,795) Net deferred tax asset $ — $ — |
Summary of Income Tax Contingencies [Table Text Block] | Years Ended December 31, 2018 Balance at December 31, 2017 $ 331 Changes related to prior year positions 330 Increases related to current year positions 42 Balance at December 31, 2018 $ 703 |
Note 1 - Organization and Bas_2
Note 1 - Organization and Basis of Presentation (Details Textual) | May 31, 2019USD ($) | May 03, 2019 | May 31, 2019USD ($) | Apr. 30, 2019USD ($) | Jun. 30, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) |
Cash and Cash Equivalents, at Carrying Value, Ending Balance | $ 24,000 | $ 1,887,000 | $ 4,301,000 | ||||
Loans Payable, Total | 4,200,000 | ||||||
Retained Earnings (Accumulated Deficit), Ending Balance | (44,417,000) | $ (37,279,000) | $ (31,294,000) | ||||
Majority Investors [Member] | |||||||
Debt Instrument, Interest Rate, Stated Percentage | 8.00% | ||||||
Majority Investors [Member] | First Note to Fund the Company's Operations [Member] | |||||||
Proceeds from Notes Payable, Total | $ 2,000,000 | ||||||
Majority Investors [Member] | Second Note to Fund the Company's Operations [Member] | |||||||
Proceeds from Notes Payable, Total | $ 500,000 | $ 500,000 | |||||
Majority Investors [Member] | Notes to Fund the Company's Operations [Member] | |||||||
Debt Instrument, Interest Rate, Stated Percentage | 8.00% | 8.00% | |||||
Convertible Debt [Member] | |||||||
Notes Payable, Total | 5,600,000 | $ 4,600,000 | |||||
Oxford Finance, LLC [Member] | |||||||
Loans Payable, Total | $ 3,000,000 | ||||||
Reverse Stock Split From [Member] | Alliqua Biomedical, Inc. [Member] | |||||||
Stockholders' Equity Note, Stock Split, Conversion Ratio | 6 | ||||||
Alliqua Biomedical, Inc. [Member] | |||||||
Business Acquisition, Exchange Ratio | 0.0359 |
Note 2 - Summary of Significa_3
Note 2 - Summary of Significant Accounting Policies (Details Textual) - USD ($) | 1 Months Ended | 6 Months Ended | 12 Months Ended | |||
Oct. 31, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Jan. 01, 2019 | |
Research and Development Expense, Total | $ 3,226,000 | $ 1,269,000 | $ 2,137,000 | $ 8,722,000 | ||
Impairment of Long-Lived Assets Held-for-use | 0 | 0 | ||||
Payments of Dividends, Total | 0 | |||||
Grants Receivable | 5,700,000 | |||||
Grant Reimbursements | 1,198,000 | |||||
Reclassification of Warrant into Equity | 234,000 | |||||
Gain (Loss) on Extinguishment of Debt, Total | $ 11,000 | |||||
Operating Lease, Liability, Total | 840,000 | 239,000 | ||||
Lessee, Operating Lease, Liability, Payments, Due, Total | 1,007,000 | |||||
Operating Lease, Right-of-Use Asset | 779,000 | |||||
Accounting Standards Update 2016-02 [Member] | ||||||
Operating Lease, Liability, Total | $ 227,000 | |||||
Lessee, Operating Lease, Liability, Payments, Due, Total | $ 239,000 | |||||
Lessee, Operating Lease, Discount Rate | 9.41% | |||||
Operating Lease, Right-of-Use Asset | $ 227,000 | |||||
Modified March 2018 and Modified September 2018 Notes [Member] | ||||||
Gain (Loss) on Extinguishment of Debt, Total | $ 11,000 | |||||
Embedded Derivative, Fair Value of Embedded Derivative Asset | 0 | 0 | ||||
Embedded Derivative, Fair Value of Embedded Derivative Liability | 0 | 0 | ||||
Research and Development Expense [Member] | ||||||
Collaboration Initiation Payment | 75,000 | |||||
Money Market Funds [Member] | ||||||
Restricted Cash, Total | 200,000 | |||||
Letter of Credit 1 [Member] | ||||||
Restricted Cash, Total | $ 55,000 | $ 55,000 | 55,000 | |||
Minimum [Member] | ||||||
Property, Plant and Equipment, Useful Life | 3 years | 3 years | ||||
Maximum [Member] | ||||||
Property, Plant and Equipment, Useful Life | 5 years | 5 years | ||||
Grants Receivable | $ 5,700,000 | |||||
Clinical Study, Premier Research International LLC and CRF Health, Inc. [Member] | ||||||
Research and Development Expense, Total | 95,000 | 6,200,000 | ||||
Clinical Study, PRA Health, CRF Health, Inc., Premier Research International LLC, ICON Central Laboratories, and Almac Clinical Services [Member] | ||||||
Research and Development Expense, Total | $ 185,000 | $ 0 | ||||
Accounts Payable 1 [Member] | Supplier Concentration Risk [Member] | Vendor 1 [Member] | ||||||
Concentration Risk, Percentage | 26.00% | 52.00% | 56.00% | |||
Accounts Payable 1 [Member] | Supplier Concentration Risk [Member] | Vendor 2 [Member] | ||||||
Concentration Risk, Percentage | 22.00% | 26.00% | 31.00% | |||
Accounts Payable 1 [Member] | Supplier Concentration Risk [Member] | Vendor 3 [Member] | ||||||
Concentration Risk, Percentage | 17.00% | 15.00% | ||||
Accounts Payable 1 [Member] | Supplier Concentration Risk [Member] | Two of the Three Vendors Supporting Clinical Study Activities [Member] | ||||||
Concentration Risk, Percentage | 44.00% | 67.00% | ||||
Accounts Payable 1 [Member] | Supplier Concentration Risk [Member] | One of the Two Vendors Supporting Manufacturing Activities [Member] | ||||||
Concentration Risk, Percentage | 56.00% |
Note 2 - Summary of Significa_4
Note 2 - Summary of Significant Accounting Policies - Fair Value Measurements Recurring Basis (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Warrant liability | $ 140 | $ 42 |
Fair Value, Recurring [Member] | ||
Total financial liabilities | 140 | 42 |
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Total financial liabilities | ||
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Total financial liabilities | ||
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Total financial liabilities | 140 | 42 |
Warrant [Member] | Fair Value, Recurring [Member] | ||
Warrant liability | 140 | 42 |
Warrant [Member] | Fair Value, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Warrant liability | ||
Warrant [Member] | Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Warrant liability | ||
Warrant [Member] | Fair Value, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Warrant liability | $ 140 | $ 42 |
Note 2 - Summary of Significa_5
Note 2 - Summary of Significant Accounting Policies - Change in Fair Value of Preferred Stock Warrant Liability (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Derivative [Member] | ||||||
Fair value, beginning of period | ||||||
Change in value | $ (60) | (60) | (211) | |||
Embedded derivative liability from the issuance of Notes | 496 | 864 | ||||
Termination of the embedded derivative liability due to the extinguishment of the related Notes | (653) | |||||
Fair value at end of period | 436 | 436 | ||||
Warrant [Member] | ||||||
Fair value, beginning of period | 234 | 42 | 140 | 42 | 42 | 54 |
Preferred stock warrants - exercised | (8) | |||||
Change in value | 94 | 98 | (4) | |||
Exchange of warrants upon Merger | (234) | (234) | ||||
Fair value at end of period | $ 42 | $ 42 | $ 140 | $ 42 |
Note 3 - Reverse Merger (Detail
Note 3 - Reverse Merger (Details Textual) | May 29, 2019USD ($)$ / shares | May 03, 2019USD ($)shares | May 31, 2019shares | Jun. 30, 2019USD ($) | Jun. 30, 2019USD ($) | Jun. 21, 2019$ / shares |
Number of Shares Held by Equity Holders | shares | 4,936,784 | |||||
Interest Expense [Member] | ||||||
Debt Instrument, Convertible, Beneficial Conversion Feature | $ 2,100,000 | |||||
Alliqua Biomedical, Inc. [Member] | ||||||
Dividends, Total | $ 5,245,000 | |||||
Common Stock, Dividends, Per Share, Cash Paid | $ / shares | $ 1.05 | |||||
AquaMed [Member] | ||||||
Common Stock, Stock Dividends, Per Share, Book Value | $ / shares | $ 0.01 | |||||
Reverse Stock Split From [Member] | Alliqua Biomedical, Inc. [Member] | ||||||
Stockholders' Equity Note, Stock Split, Conversion Ratio | 6 | |||||
Alliqua Biomedical, Inc. [Member] | ||||||
Business Acquisition, Exchange Ratio | 0.0359 | |||||
Intangible Assets, Net (Including Goodwill), Total | $ 0 | |||||
Merger Agreement, Percentage Ownership in Combined Company, Acquirer | 86.00% | |||||
Merger Agreement, Percentage Ownership in Combined Company, Acquiree | 14.00% | |||||
Alliqua Biomedical, Inc. [Member] | Conversion of Notes into Series B Convertible Preferred Stock [Member] | ||||||
Debt Conversion, Original Debt, Amount, Principal | $ 3,000,000 | |||||
Debt Conversion, Original Debt, Amount, Cumulative Accrued Interest | $ 203,000 | |||||
Debt Conversion, Converted Instrument, Shares Issued | shares | 367,041 | 367,041 | ||||
Debt Instrument, Convertible, Beneficial Conversion Feature | $ 2,100,000 |
Note 4 - Property and Equipme_3
Note 4 - Property and Equipment, Net (Details Textual) - USD ($) | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Depreciation, Total | $ 4,000 | $ 4,000 | $ 8,000 | $ 10,000 |
Note 4 - Property and Equipme_4
Note 4 - Property and Equipment, Net - Property and Equipment, Net (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Property and equipment, gross | $ 51 | $ 51 | $ 57 |
Less accumulated depreciation | (45) | (41) | (44) |
Property and equipment, net | 6 | 10 | 13 |
Furniture and Fixtures [Member] | |||
Property and equipment, gross | 29 | 29 | 29 |
Office Equipment [Member] | |||
Property and equipment, gross | 2 | 2 | 2 |
Computer Equipment [Member] | |||
Property and equipment, gross | 18 | 18 | 24 |
Laboratory Equipment [Member] | |||
Property and equipment, gross | $ 2 | $ 2 | $ 2 |
Note 4 - Accrued Liabilities -
Note 4 - Accrued Liabilities - Accrued Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Note 4 - Accrued Liabilities - Accrued Liabilities (Details) | |||
Payroll and related expenses | $ 508 | $ 241 | $ 273 |
Accrued term loan final payment | 569 | 421 | 197 |
Accrued clinical trial expense | 8 | 654 | |
Professional fees and other costs | 395 | 195 | 34 |
Total accrued liabilities | $ 1,480 | $ 857 | $ 1,158 |
Note 5 - Other Balance Sheet _3
Note 5 - Other Balance Sheet Information - Accrued Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Payroll and related expenses | $ 508 | $ 241 | $ 273 |
Accrued term loan final payment | 569 | 421 | 197 |
Accrued clinical trial expense | 8 | 654 | |
Professional fees and other costs | 395 | 195 | 34 |
Total accrued liabilities | $ 1,480 | $ 857 | $ 1,158 |
Note 5 - Other Balance Sheet _4
Note 5 - Other Balance Sheet Information - Prepaid and Other Current Assets (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Prepaid clinical trial expenses | $ 435 | $ 5 | |
Equity issuance costs | 343 | ||
Prepaid insurance | 670 | ||
Other prepaid expenses | 174 | 5 | |
Total prepaid and other current assets | $ 1,622 | $ 10 | $ 34 |
Note 6 - Term Loans and Conve_3
Note 6 - Term Loans and Convertible Promissory Notes (Details Textual) | May 31, 2019USD ($) | May 03, 2019shares | Sep. 27, 2018USD ($) | Mar. 29, 2018USD ($) | Nov. 01, 2016 | Mar. 31, 2016USD ($) | Jan. 29, 2016USD ($) | Nov. 25, 2015 | Nov. 24, 2015USD ($)shares | Jun. 30, 2019USD ($) | May 31, 2019USD ($)shares | Apr. 30, 2019USD ($) | Jan. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Oct. 31, 2018USD ($)$ / shares | Sep. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Jan. 31, 2017USD ($) | Jun. 30, 2019USD ($) | Jun. 30, 2018USD ($) | Jun. 30, 2019USD ($) | Jun. 30, 2018USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Jun. 30, 2019USD ($) | Jun. 20, 2019USD ($) | Jan. 31, 2016shares | Nov. 30, 2015shares |
Loans Payable, Total | $ 4,200,000 | $ 4,200,000 | ||||||||||||||||||||||||||
Interest Expense, Total | $ 2,641,000 | $ 445,000 | 644,000 | $ 515,000 | ||||||||||||||||||||||||
Gain (Loss) on Extinguishment of Debt, Total | $ 11,000 | |||||||||||||||||||||||||||
Beneficial Conversion Feature, Conversion of Convertible Note | ||||||||||||||||||||||||||||
Conversion of Notes into Series B Convertible Preferred Stock [Member] | ||||||||||||||||||||||||||||
Debt Conversion, Original Debt, Amount | $ 3,200,000 | |||||||||||||||||||||||||||
Conversion of Notes into Series B Convertible Preferred Stock [Member] | Alliqua Biomedical, Inc. [Member] | ||||||||||||||||||||||||||||
Debt Conversion, Converted Instrument, Shares Issued | shares | 367,041 | 367,041 | ||||||||||||||||||||||||||
Debt Instrument, Convertible, Beneficial Conversion Feature | $ 2,100,000 | |||||||||||||||||||||||||||
Beneficial Conversion Feature, Conversion of Convertible Note | 2,100,000 | |||||||||||||||||||||||||||
Modified March 2019 and Modified December 2018 Notes [Member] | ||||||||||||||||||||||||||||
Debt Instrument, Convertible, Preferred Stock Proceeds Trigger | $ 5,000,000 | 5,000,000 | ||||||||||||||||||||||||||
Debt Instrument, Convertible, Common Stock Proceeds Trigger | $ 5,000,000 | |||||||||||||||||||||||||||
Debt Instrument, Convertible, Conversion Ratio | 80 | |||||||||||||||||||||||||||
Debt Instrument, Conversion to Cash in Case of Change in Control | 200.00% | 200.00% | 200.00% | 200.00% | 200.00% | 200.00% | ||||||||||||||||||||||
Financing Threshold, Proceeds to Convert Notes to Equity | $ 5,000,000 | |||||||||||||||||||||||||||
Modified March 2018 and Modified September 2018 Notes [Member] | ||||||||||||||||||||||||||||
Debt Instrument, Convertible, Conversion Ratio | 80 | |||||||||||||||||||||||||||
Debt Instrument, Conversion to Cash in Case of Change in Control | 200.00% | 200.00% | ||||||||||||||||||||||||||
Gain (Loss) on Extinguishment of Debt, Total | 11,000 | |||||||||||||||||||||||||||
Financing Threshold, Proceeds to Convert Notes to Equity | $ 5,000,000 | |||||||||||||||||||||||||||
Debt Instrument, Conversion to Cash in Case of Change in Control, Premium | 100.00% | 100.00% | ||||||||||||||||||||||||||
Voting Rights Transferred to be Considered a Change in Control | 50.00% | 50.00% | ||||||||||||||||||||||||||
Embedded Derivative, Fair Value of Embedded Derivative Liability | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | ||||||||||||||||||||||
Amortization of Debt Discount (Premium) | 641,000 | |||||||||||||||||||||||||||
Release of Derivative Liabilities | $ 653,000 | |||||||||||||||||||||||||||
Modified March 2018 and Modified September 2018 Notes [Member] | Convert Notes And Accrued Interest To Series B Preferred Stock [Member] | ||||||||||||||||||||||||||||
Debt Instrument, Convertible, Conversion Price | $ / shares | $ 0.3133 | |||||||||||||||||||||||||||
Convertible Promissory Note Issued On March292019 [Member] | ||||||||||||||||||||||||||||
Probability of Qualified Financing Occurring | 30.00% | |||||||||||||||||||||||||||
Embedded Derivative, Fair Value of Embedded Derivative Liability | $ 496,000 | |||||||||||||||||||||||||||
Debt Instrument, Convertible, Remaining Discount Amortization Period | 1 year | |||||||||||||||||||||||||||
Debt Instrument, Unamortized Discount, Current | $ 496,000 | |||||||||||||||||||||||||||
Probability of Change in Control Occurring | 15.00% | |||||||||||||||||||||||||||
Convertible Promissory Note Issued September272018 [Member] | ||||||||||||||||||||||||||||
Probability of Qualified Financing Occurring | 40.00% | |||||||||||||||||||||||||||
Embedded Derivative, Fair Value of Embedded Derivative Liability | $ 368,000 | |||||||||||||||||||||||||||
Debt Instrument, Convertible, Remaining Discount Amortization Period | 1 year | |||||||||||||||||||||||||||
Debt Instrument, Unamortized Discount, Current | $ 369,000 | |||||||||||||||||||||||||||
Probability of Change in Control Occurring | 0.00% | |||||||||||||||||||||||||||
Modified March 2018, September 2018, December 2018, and March 2019 Notes [Member] | ||||||||||||||||||||||||||||
Probability of Qualified Financing Occurring | 0.00% | 0.00% | 0.00% | |||||||||||||||||||||||||
Embedded Derivative, Fair Value of Embedded Derivative Liability | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||
Amortization of Debt Discount (Premium) | $ 223,000 | 0 | ||||||||||||||||||||||||||
Probability of Change in Control Occurring | 0.00% | 0.00% | 0.00% | |||||||||||||||||||||||||
Warrant to Purchase Series A Convertible Preferred Stock Under Oxford Loan Agreement [Member] | ||||||||||||||||||||||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | shares | 11,829 | 131,810 | 197,715 | |||||||||||||||||||||||||
Oxford Finance, LLC [Member] | ||||||||||||||||||||||||||||
Debt Instrument, Face Amount | $ 10,000,000 | |||||||||||||||||||||||||||
Oxford Finance, LLC [Member] | Term Loan A [Member] | ||||||||||||||||||||||||||||
Debt Instrument, Face Amount | 3,000,000 | |||||||||||||||||||||||||||
Proceeds from Issuance of Debt | 3,000,000 | |||||||||||||||||||||||||||
Debt Issuance Costs, Gross | 141,000 | |||||||||||||||||||||||||||
Loans Payable, Total | 1,400,000 | $ 2,300,000 | 1,400,000 | 1,400,000 | $ 2,300,000 | 1,400,000 | ||||||||||||||||||||||
Debt Issuance Costs, Net, Total | 141,000 | |||||||||||||||||||||||||||
Long-term Debt, Total | 2,300,000 | 2,300,000 | 2,800,000 | |||||||||||||||||||||||||
Oxford Finance, LLC [Member] | Term Loan B [Member] | ||||||||||||||||||||||||||||
Debt Instrument, Face Amount | 2,000,000 | |||||||||||||||||||||||||||
Proceeds from Issuance of Debt | $ 2,000,000 | 2,000,000 | ||||||||||||||||||||||||||
Debt Issuance Costs, Gross | 3,000 | 3,000 | 3,000 | 3,000 | ||||||||||||||||||||||||
Loans Payable, Total | $ 1,000,000 | 1,500,000 | 1,000,000 | 1,000,000 | 1,500,000 | 1,000,000 | ||||||||||||||||||||||
Debt Issuance Costs, Net, Total | 3,000 | |||||||||||||||||||||||||||
Long-term Debt, Total | $ 1,500,000 | 1,500,000 | $ 1,900,000 | |||||||||||||||||||||||||
Oxford Finance, LLC [Member] | Term Loan C [Member] | ||||||||||||||||||||||||||||
Debt Instrument, Face Amount | $ 5,000,000 | |||||||||||||||||||||||||||
Proceeds from Issuance of Debt | $ 0 | |||||||||||||||||||||||||||
Debt Instrument, Unused Borrowing Capacity, Amount | 5,000,000 | |||||||||||||||||||||||||||
Debt Instrument, Unused Borrowing Capacity, Expired | $ 5,000,000 | |||||||||||||||||||||||||||
Oxford Finance, LLC [Member] | Term Loans [Member] | ||||||||||||||||||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 7.06% | |||||||||||||||||||||||||||
Debt Instrument, Prepayment Fee Before First Anniversary,Percentage | 3.00% | |||||||||||||||||||||||||||
Debt Instrument, Prepayment Fee if Company is Acquired Within Six Months of Closing, Percentage | 1.00% | |||||||||||||||||||||||||||
Debt Instrument, Prepayment Fee Between First and Second Anniversary, Percentage | 2.00% | |||||||||||||||||||||||||||
Debt Instrument, Prepayment Fee After Second Anniversary, Percentage | 1.00% | |||||||||||||||||||||||||||
Debt Instrument, Periodic Payment Terms, Balloon Payment to be Paid, Percentage | 4.25% | |||||||||||||||||||||||||||
Long-term Debt, Principal and Interest Payments, Term | 3 years | |||||||||||||||||||||||||||
Debt Instrument, Periodic Payment Terms, Increase (Decrease) in Balloon Payment to be Paid | $ 200,000 | $ 100,000 | ||||||||||||||||||||||||||
Debt Instrument, Periodic Payment, Increase (Decrease) of Interest-Only Payments | 60 days | 150 days | 1 year | |||||||||||||||||||||||||
Debt Instrument, Periodic Payment, Increase (Decrease) of Periodic Payments | 1 year 90 days | 1 year 330 days | ||||||||||||||||||||||||||
Gain (Loss) Debt Modification | $ 0 | $ 0 | $ 0 | |||||||||||||||||||||||||
Interest Expense, Debt, Total | 157,000 | $ 171,000 | 336,000 | $ 309,000 | ||||||||||||||||||||||||
Oxford Finance, LLC [Member] | Term Loans [Member] | Domain [Member] | ||||||||||||||||||||||||||||
Debt Instrument, Increase of Periodic Payments Upon Delivery of Executed Term Sheet | 240 days | |||||||||||||||||||||||||||
Proceeds from Noncontrolling Interests | $ 20,000,000 | |||||||||||||||||||||||||||
Restricted Cash, Total | $ 200,000 | $ 200,000 | $ 200,000 | $ 200,000 | ||||||||||||||||||||||||
Debt Instrument, Periodic Payment Terms, Increase (Decrease) in Balloon Payment to be Paid | $ 50,000 | $ 20,000 | ||||||||||||||||||||||||||
Oxford Finance, LLC [Member] | Term Loans [Member] | Convertible Promissory Note of 1.5 Million [Member] | ||||||||||||||||||||||||||||
Debt Instrument, Increase of Interest-Only Periodic Payments Upon Entering Into a Merger | 60 days | |||||||||||||||||||||||||||
Debt Instrument, Increase of Periodic Payments Following Merger | 330 days | |||||||||||||||||||||||||||
Debt Instrument, Increase of Periodic Payments Following the Closing of a Convertible Note | 300 days | |||||||||||||||||||||||||||
Debt Instrument, Periodic Payment Terms, Increase (Decrease) in Balloon Payment to be Paid | $ 35,000 | $ 25,000 | 35,000 | |||||||||||||||||||||||||
Debt Instrument, Increase of Interest-Only Periodic Payments Upon Closing of Convertible Note | 30 days | 30 days | ||||||||||||||||||||||||||
Proceeds from Convertible Debt | $ 1,500,000 | $ 1,500,000 | ||||||||||||||||||||||||||
Oxford Finance, LLC [Member] | Term Loans [Member] | London Interbank Offered Rate (LIBOR) Swap Rate [Member] | Minimum [Member] | ||||||||||||||||||||||||||||
Debt Instrument, Basis Spread on Variable Rate | 0.19% | 0.19% | ||||||||||||||||||||||||||
Majority Investors [Member] | ||||||||||||||||||||||||||||
Debt Instrument, Face Amount | $ 4,500,000 | $ 4,500,000 | ||||||||||||||||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 8.00% | 8.00% | ||||||||||||||||||||||||||
Majority Investors [Member] | First Note to Fund the Company's Operations [Member] | ||||||||||||||||||||||||||||
Proceeds from Notes Payable, Total | $ 2,000,000 | |||||||||||||||||||||||||||
Majority Investors [Member] | Second Note to Fund the Company's Operations [Member] | ||||||||||||||||||||||||||||
Proceeds from Notes Payable, Total | $ 500,000 | $ 500,000 | ||||||||||||||||||||||||||
Majority Investors [Member] | Notes to Fund the Company's Operations [Member] | ||||||||||||||||||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 8.00% | 8.00% |
Note 6 - Term Loans and Conve_4
Note 6 - Term Loans and Convertible Promissory Notes - Future Principal Payments of Term Loans (Details) $ in Thousands | Dec. 31, 2018USD ($) |
Term Loans [Member] | |
Total principal payments | $ 3,833 |
Note 6 - Term Loans and Conve_5
Note 6 - Term Loans and Convertible Promissory Notes - Convertible Promissory Notes (Details) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Convertible Note Payable, One [Member] | ||
Maturity date | Mar. 29, 2019 | Mar. 29, 2019 |
Debt Instrument, Interest Rate, Stated Percentage | 8.00% | 8.00% |
Convertible Note Payable Two [Member] | ||
Maturity date | Sep. 27, 2019 | Sep. 27, 2019 |
Debt Instrument, Interest Rate, Stated Percentage | 8.00% | 8.00% |
Convertible Note Payable, Three [Member] | ||
Maturity date | Dec. 21, 2019 | Dec. 21, 2019 |
Debt Instrument, Interest Rate, Stated Percentage | 8.00% | 8.00% |
Note 6 - Term Loans and Conve_6
Note 6 - Term Loans and Convertible Promissory Notes - Convertible Promissory Notes (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Convertible note payable, due on March 29, 2019 | $ 5,500 | $ 4,500 |
Convertible Note Payable, One [Member] | ||
Convertible note payable, due on March 29, 2019 | 1,500 | |
Convertible Note Payable Two [Member] | ||
Convertible note payable, due on March 29, 2019 | 1,500 | |
Convertible Note Payable, Three [Member] | ||
Convertible note payable, due on March 29, 2019 | 1,500 | 1,500 |
Convertible Note Payable, Four [Member] | ||
Convertible note payable, due on March 29, 2019 | 1,500 | |
Convertible Note Payable Five [Member] | ||
Convertible note payable, due on March 29, 2019 | 2,000 | |
Convertible Note Payable Six [Member] | ||
Convertible note payable, due on March 29, 2019 | $ 500 |
Note 6 - Commitments and Cont_3
Note 6 - Commitments and Contingencies (Details Textual) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Note To Financial Statement Details Textual | |||||
Operating Lease, Expense | $ 98,000 | $ 165,000 | $ 115,000 | $ 232,000 | $ 225,000 |
Note 6 - Commitments and Cont_4
Note 6 - Commitments and Contingencies - Future Lease Payments (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Note 6 - Commitments and Contingencies - Future Lease Payments (Details) | ||
2019 (remaining 6 months) | $ 232 | $ 239 |
Total | $ 840 | $ 239 |
Note 7 - Leases (Details Textua
Note 7 - Leases (Details Textual) xbrli-pure in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2019USD ($) | Jun. 30, 2019USD ($) | Jun. 30, 2018USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | |
Operating Lease, Expense | $ 98,000 | $ 165,000 | $ 115,000 | $ 232,000 | $ 225,000 |
Finance Lease, Liability, Total | $ 0 | $ 0 | |||
Lessee, Operating Lease, Not yet Commenced | 0 | 0 | |||
Lessee, Finance Lease, Not yet Commenced | 0 | 0 | |||
Sublease Income | $ 42,000 |
Note 7 - Leases - Future Minimu
Note 7 - Leases - Future Minimum Lease Payments (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
2019 (remaining 6 months) | $ 232 | $ 239 |
2020 | 227 | |
2021 | 232 | |
2022 | 236 | |
2023 | 80 | |
Total future minimum lease payments | 1,007 | |
Less: imputed interest | (167) | |
Total | $ 840 | $ 239 |
Note 7 - Stockholders' Defici_2
Note 7 - Stockholders' Deficit (Details Textual) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2010 | Jun. 30, 2019 | |
Preferred Stock, Dividends Per Share, Declared | $ 0 | $ 0 | |||
Common Stock, Shares Authorized | 5,313,200 | 148,000,000 | 95,000,000 | ||
Common Stock, Par or Stated Value Per Share | $ 0.001 | $ 0.001 | $ 0.001 | ||
Common Stock, Shares, Outstanding, Ending Balance | 701,808 | 19,548,969 | 5,807,877 | ||
Common Stock, Dividends, Per Share, Declared | $ 0 | ||||
Conversion of Preferred Stock to Common Stock [Member] | |||||
Equity, Convertible, Aggregate Proceeds Trigger | $ 40 | ||||
Equity, Convertible, Stock Price Trigger | $ 1 | ||||
Noncumulative Dividends for Holders of Series B Convertible Preferred Stock [Member] | |||||
Dividends Payable, Amount Per Share | 0.0251 | ||||
Noncumulative Dividends for Holders of Series A Convertible Preferred Stock [Member] | |||||
Dividends Payable, Amount Per Share | $ 0.0182 | ||||
Convert Notes and Accrued Interest to Series A Preferred Stock [Member] | |||||
Debt Conversion, Converted Instrument, Shares Issued | 3,531,889 | ||||
Convert Notes and Accrued Interest to Series B Preferred Stock [Member] | |||||
Debt Conversion, Converted Instrument, Shares Issued | 6,469,356 | ||||
Series A Redeemable Convertible Preferred Stock Without Giving Effect To The Reverse Stock Split [Member] | |||||
Redeemable convertible preferred stock, shares issued (in shares) | 2,034,548 | 56,672,658 | 0 | ||
Redeemable convertible preferred stock, shares outstanding (in shares) | 2,034,548 | 56,672,658 | 0 | ||
Series B Redeemable Convertible Preferred Stock Without Giving Effect To The Reverse Stock Split [Member] | |||||
Redeemable convertible preferred stock, shares issued (in shares) | 1,833,387 | 51,069,262 | |||
Temporary Equity, Remaining Shares Outstanding Requirements To Elect One Director | 10,000,000 | ||||
Redeemable convertible preferred stock, shares outstanding (in shares) | 1,833,387 | 51,069,262 | 0 | ||
Series B Convertible Preferred Stock [Member] | |||||
Temporary Equity, Liquidation Preference Per Share | $ 0.3133 | ||||
Series A Convertible Preferred Stock [Member] | |||||
Temporary Equity, Liquidation Preference Per Share | $ 0.2276 |
Note 7 - Stockholders' Defici_3
Note 7 - Stockholders' Deficit - Shares Reserved for Future Issuance (Details) - shares | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Common stock options issued and outstanding (in shares) | 19,222 | 19,222 |
Total (in shares) | 127,294 | 127,294 |
Warrants Reserve for Series A Convertible Preferred Stock [Member] | ||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 330,000 | 330,000 |
Series A Preferred Stock [Member] | ||
Series A convertible preferred stock (in shares) | 56,673,000 | 56,673,000 |
Conversion Of Stock Shares Issued1 | 11,335 | 11,335 |
Series B Preferred Stock [Member] | ||
Series A convertible preferred stock (in shares) | 51,069,000 | 51,069,000 |
Conversion Of Stock Shares Issued1 | 10,214 | 10,214 |
Note 8 - Redeemable Convertib_2
Note 8 - Redeemable Convertible Preferred Stock (Details Textual) - shares | 1 Months Ended | |||
May 31, 2019 | Jun. 30, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Preferred Stock, Shares Issued, Total | 0 | 0 | ||
Preferred Stock, Shares Authorized | 1,000,000 | 1,000,000 | ||
Preferred Stock, Shares Outstanding, Ending Balance | 0 | 0 | ||
Conversion of Notes into Series B Convertible Preferred Stock [Member] | ||||
Debt Conversion, Converted Instrument, Shares Issued | 367,041 | |||
Series A Redeemable Convertible Preferred Stock [Member] | ||||
Redeemable convertible preferred stock, shares issued (in shares) | 0 | 2,034,548 | 56,672,658 | |
Redeemable convertible preferred stock, shares outstanding (in shares) | 0 | 2,034,548 | 56,672,658 | |
Series B Redeemable Convertible Preferred Stock [Member] | ||||
Redeemable convertible preferred stock, shares issued (in shares) | 1,833,387 | 51,069,262 | ||
Redeemable convertible preferred stock, shares outstanding (in shares) | 0 | 1,833,387 | 51,069,262 |
Note 9 - Warrants (Details Text
Note 9 - Warrants (Details Textual) | May 03, 2019USD ($)$ / sharesshares | Jan. 31, 2016USD ($)$ / sharesshares | Nov. 30, 2015USD ($)$ / sharesshares | Jul. 01, 2010 | Jun. 30, 2019USD ($) | Jun. 30, 2019USD ($) | Jun. 30, 2018USD ($) | Dec. 31, 2018USD ($)shares | Dec. 31, 2017USD ($) | Nov. 24, 2015shares |
Fair Value Adjustment of Warrants | $ 95,000 | $ 1,000 | $ 98,000 | $ (12,000) | ||||||
Exchange of Warrants Upon Merger | $ 234,000 | |||||||||
Warrant to Purchase Series A Convertible Preferred Stock Under Oxford Loan Agreement [Member] | ||||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | shares | 131,810 | 197,715 | 11,829 | |||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ / shares | $ 0.2276 | $ 0.2276 | ||||||||
Warrants Not Settleable in Cash, Fair Value Disclosure | $ 22,000 | $ 33,000 | ||||||||
Percentage of Note Payable Principal | 20.00% | |||||||||
Class of Warrants or Right, Exercisable, Term | 10 years | 10 years | 5 years | |||||||
Warrant to Purchase Series A Convertible Preferred Stock Under Oxford Loan Agreement [Member] | Measurement Input, Expected Term [Member] | ||||||||||
Warrants and Rights Outstanding, Measurement Input | 10 | 10 | ||||||||
Warrant to Purchase Series A Convertible Preferred Stock Under Oxford Loan Agreement [Member] | Measurement Input, Expected Term [Member] | Minimum [Member] | ||||||||||
Warrants and Rights Outstanding, Measurement Input | 3.92 | |||||||||
Warrant to Purchase Series A Convertible Preferred Stock Under Oxford Loan Agreement [Member] | Measurement Input, Risk Free Interest Rate [Member] | ||||||||||
Warrants and Rights Outstanding, Measurement Input | 0.0209 | 0.0207 | ||||||||
Warrant to Purchase Series A Convertible Preferred Stock Under Oxford Loan Agreement [Member] | Measurement Input, Price Volatility [Member] | ||||||||||
Warrants and Rights Outstanding, Measurement Input | 0.686 | 0.687 | ||||||||
Warrant to Purchase Series A Convertible Preferred Stock Under Oxford Loan Agreement [Member] | Measurement Input, Conversion Price [Member] | ||||||||||
Warrants and Rights Outstanding, Measurement Input | 0.20 | |||||||||
Warrant to Purchase Series A Convertible Preferred Stock Under Oxford Loan Agreement [Member] | Measurement Input, Share Price [Member] | ||||||||||
Warrants and Rights Outstanding, Measurement Input | 0.23 | |||||||||
Warrants For Series A Convertible Preferred Stock [Member] | ||||||||||
Warrants and Rights Outstanding | $ 140,000 | $ 42,000 | ||||||||
Class of Warrant or Right, Outstanding | shares | 330 | |||||||||
Class of Warrants or Right, Exercisable, Term | 7 years | |||||||||
Warrants For Series A Convertible Preferred Stock [Member] | Measurement Input, Expected Term [Member] | Minimum [Member] | ||||||||||
Warrants and Rights Outstanding, Measurement Input | 6.92 | 7.92 | ||||||||
Warrants For Series A Convertible Preferred Stock [Member] | Measurement Input, Expected Term [Member] | Maximum [Member] | ||||||||||
Warrants and Rights Outstanding, Measurement Input | 7 | 7.08 | 8.08 | |||||||
Warrants For Series A Convertible Preferred Stock [Member] | Measurement Input, Risk Free Interest Rate [Member] | ||||||||||
Warrants and Rights Outstanding, Measurement Input | 2.28 | |||||||||
Warrants For Series A Convertible Preferred Stock [Member] | Measurement Input, Risk Free Interest Rate [Member] | Minimum [Member] | ||||||||||
Warrants and Rights Outstanding, Measurement Input | 0.0146 | 2.56 | ||||||||
Warrants For Series A Convertible Preferred Stock [Member] | Measurement Input, Risk Free Interest Rate [Member] | Maximum [Member] | ||||||||||
Warrants and Rights Outstanding, Measurement Input | 0.0266 | 2.59 | ||||||||
Warrants For Series A Convertible Preferred Stock [Member] | Measurement Input, Price Volatility [Member] | ||||||||||
Warrants and Rights Outstanding, Measurement Input | 71 | |||||||||
Warrants For Series A Convertible Preferred Stock [Member] | Measurement Input, Price Volatility [Member] | Minimum [Member] | ||||||||||
Warrants and Rights Outstanding, Measurement Input | 0.736 | 76.84 | ||||||||
Warrants For Series A Convertible Preferred Stock [Member] | Measurement Input, Price Volatility [Member] | Maximum [Member] | ||||||||||
Warrants and Rights Outstanding, Measurement Input | 0.815 | |||||||||
Warrants For Series A Convertible Preferred Stock [Member] | Measurement Input, Conversion Price [Member] | ||||||||||
Warrants and Rights Outstanding, Measurement Input | 0.2276 | |||||||||
Warrant Issued In Connection With Term Loan A And B [Member] | ||||||||||
Fair Value Adjustment of Warrants | $ 98,000 | $ (12,000) | ||||||||
Alliqua Warrants Assumed in Merger [Member] | ||||||||||
Class of Warrant or Right, Outstanding | shares | 38,945 | |||||||||
Alliqua Warrants Assumed in Merger [Member] | Minimum [Member] | ||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ / shares | $ 26.40 | |||||||||
Alliqua Warrants Assumed in Merger [Member] | Maximum [Member] | ||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ / shares | $ 28.20 | |||||||||
Alliqua Biomedical, Inc. [Member] | Warrant to Purchase Common Stock Converted in Merger [Member] | ||||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | shares | 11,829 | |||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ / shares | $ 6.34 | |||||||||
Exchange of Warrants Upon Merger | $ 234,000 |
Note 9 - Warrants - Details of
Note 9 - Warrants - Details of Warrants (Details) | Dec. 31, 2018$ / sharesshares |
Warrants for Series A Convertible Preferred Stock Issued in November, 2015 [Member] | |
us-gaap_ClassOfWarrantOrRightExercisePriceOfWarrantsOrRights1 | $ / shares | $ 0.2276 |
us-gaap_ClassOfWarrantOrRightOutstanding | 198 |
Warrants for Series A Convertible Preferred Stock Issued in January, 2016 [Member] | |
us-gaap_ClassOfWarrantOrRightExercisePriceOfWarrantsOrRights1 | $ / shares | $ 0.2276 |
us-gaap_ClassOfWarrantOrRightOutstanding | 132 |
Warrants for Series A Convertible Preferred Stock [Member] | |
us-gaap_ClassOfWarrantOrRightOutstanding | 330 |
Note 9 - Warrants - Warrants As
Note 9 - Warrants - Warrants Assumptions (Details) - Warrants for Series A Convertible Preferred Stock [Member] | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Jul. 01, 2010 |
Measurement Input, Risk Free Interest Rate [Member] | |||
Risk-free interest rate | 2.28 | ||
Measurement Input, Risk Free Interest Rate [Member] | Minimum [Member] | |||
Risk-free interest rate | 2.56 | 0.0146 | |
Measurement Input, Risk Free Interest Rate [Member] | Maximum [Member] | |||
Risk-free interest rate | 2.59 | 0.0266 | |
Measurement Input, Expected Term [Member] | Minimum [Member] | |||
Risk-free interest rate | 6.92 | 7.92 | |
Measurement Input, Expected Term [Member] | Maximum [Member] | |||
Risk-free interest rate | 7.08 | 8.08 | 7 |
Measurement Input, Price Volatility [Member] | |||
Risk-free interest rate | 71 | ||
Measurement Input, Price Volatility [Member] | Minimum [Member] | |||
Risk-free interest rate | 76.84 | 0.736 | |
Measurement Input, Price Volatility [Member] | Maximum [Member] | |||
Risk-free interest rate | 0.815 |
Note 10 - Stock Options (Detail
Note 10 - Stock Options (Details Textual) - USD ($) | May 03, 2019 | Jun. 30, 2019 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 0 | 0 | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number, Ending Balance | 748,000 | 748,000 | 19,222 | 19,222 | 19,222 | ||
Share-based Payment Arrangement, Nonvested Award, Option, Cost Not yet Recognized, Amount | $ 531,000 | ||||||
Non-employee Stock Options, Comensation Expense, Cost Not yet Recognized, Amount | $ 48,000 | ||||||
Non-employee Stock Options, Comensation Expense, Cost Not yet Recognized, Period for Recognition | 270 days | ||||||
Common Stock, Capital Shares Reserved for Future Issuance | 19,222 | 19,222 | |||||
Share Price | $ 64.07 | $ 61.28 | |||||
Share-based Payment Arrangement, Option [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 0 | 0 | |||||
Share-based Payment Arrangement, Expense | $ 136,000 | $ 150,000 | $ 293,000 | $ 301,000 | |||
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Amount, Total | $ 395,000 | $ 395,000 | |||||
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Period for Recognition | 1 year 182 days | 2 years | |||||
Non-employee Options [Member] | |||||||
Share-based Payment Arrangement, Expense | $ 32,000 | $ 0 | $ 16,000 | $ 0 | |||
Non-employee Stock Options, Comensation Expense, Cost Not yet Recognized, Amount | $ 16,000 | $ 16,000 | |||||
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Period for Recognition | 90 days | ||||||
Alliqua Biomedical, Inc. [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number, Ending Balance | 57,822 | ||||||
Minimum [Member] | Alliqua Biomedical, Inc. [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercise Price | $ 21 | ||||||
Maximum [Member] | Alliqua Biomedical, Inc. [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercise Price | $ 656.40 | ||||||
Alliqua Biomedical, Inc. [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 690,058 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number, Ending Balance | 11,000 | 11,000 | |||||
Alliqua Biomedical, Inc. [Member] | Minimum [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercise Price | $ 1.11 | ||||||
Alliqua Biomedical, Inc. [Member] | Maximum [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercise Price | $ 3.06 | ||||||
The Plan [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Minimum Price as Percentage of Estimated Fair Value of Underlying Shares | 100.00% | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Minimum Price as Percentage of Estimated Fair Value of Underlying Shares, 10% Shareholder | 110.00% | ||||||
The Plan [Member] | Share-based Payment Arrangement, Option [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period | 10 years | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 4 years |
Note 10 - Stock Option Plans -
Note 10 - Stock Option Plans - Summary of Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 6 Months Ended | 12 Months Ended | |||||
Jun. 30, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | ||||
Note 9 - Stock Option Plans - Summary of Stock Option Activity (Details) | |||||||
Shares Available For Grant, Balance (in shares) | 5,000 | 5,000 | 5,000 | ||||
Number of Options, Alliqua options assumed in merger (in shares) | 748,000 | 19,222 | 19,222 | 19,222 | |||
Weighted Average Exercise Price, Alliqua options assumed in merger (in dollars per share) | $ 24.95 | $ 0.10 | $ 0.10 | $ 0.10 | |||
Weighted Average Remaining Life in Years, outstanding (Year) | 6 years 73 days | 7 years 4 months 24 days | 8 years 4 months 24 days | 9 years 4 months 24 days | |||
Intrinsic Value, outstanding | $ 188 | $ 6,956 | [1] | $ 6,639 | [1] | ||
Options Outstanding, Vested and expected to vest (in shares) | 19,222 | ||||||
Weighted Average Exercise Price Per Share, Vested and expected to vest (in dollars per share) | $ 0.10 | ||||||
Weighted-average Remaining Contractual Life, Vested and expected to vest (Year) | 7 years 4 months 24 days | ||||||
Aggregate Intrinsic Value, Vested and expected to vest | [1] | $ 6,956 | |||||
Number of Options, exercisable (in shares) | 530,000 | 19,222,032 | |||||
Weighted Average Exercise Price, exercisable (in dollars per share) | $ 33.93 | $ 0.09 | |||||
Weighted Average Remaining Life in Years, exercisable (Year) | 5 years 255 days | 7 years 4 months 24 days | |||||
Intrinsic Value, exercisable | $ 188 | $ 4,119 | [1] | ||||
[1] | The aggregate intrinsic value is calculated as the difference between the stock option exercise price and the estimated fair value of the Company's common stock of $0.46 and $0.44 per share as of December 31, 2018 and 2017. |
Note 10 - Stock Options - Stock
Note 10 - Stock Options - Stock Options by Exercise Price Range (Details) shares in Thousands | 6 Months Ended |
Jun. 30, 2019$ / sharesshares | |
Options Outstanding, weighted average exercise price (in dollars per share) | $ 24.95 |
Options Outstanding, number of options (in shares) | shares | 748 |
Options Exercisable, weighted average exercise price (in dollars per share) | $ 24.95 |
Options Exercisable, weighted average remaining life in years (Year) | 5 years 255 days |
Options exercisable, number of options exercisable (in shares) | shares | 530 |
Price Range 1 [Member] | |
Range of Exercise Price, lower (in dollars per share) | $ 1.11 |
Range of Exercise Price, upper (in dollars per share) | 1.38 |
Options Outstanding, weighted average exercise price (in dollars per share) | $ 1.11 |
Options Outstanding, number of options (in shares) | shares | 73 |
Options Exercisable, weighted average exercise price (in dollars per share) | $ 1.11 |
Options Exercisable, weighted average remaining life in years (Year) | 2 years 182 days |
Options exercisable, number of options exercisable (in shares) | shares | 73 |
Price Range 2 [Member] | |
Range of Exercise Price, lower (in dollars per share) | $ 1.39 |
Range of Exercise Price, upper (in dollars per share) | 3.05 |
Options Outstanding, weighted average exercise price (in dollars per share) | $ 1.39 |
Options Outstanding, number of options (in shares) | shares | 37 |
Options Exercisable, weighted average exercise price (in dollars per share) | $ 1.39 |
Options Exercisable, weighted average remaining life in years (Year) | 3 years 73 days |
Options exercisable, number of options exercisable (in shares) | shares | 37 |
Price Range 3 [Member] | |
Range of Exercise Price, lower (in dollars per share) | $ 3.06 |
Range of Exercise Price, upper (in dollars per share) | 20.99 |
Options Outstanding, weighted average exercise price (in dollars per share) | $ 3.06 |
Options Outstanding, number of options (in shares) | shares | 580 |
Options Exercisable, weighted average exercise price (in dollars per share) | $ 3.06 |
Options Exercisable, weighted average remaining life in years (Year) | 7 years 182 days |
Options exercisable, number of options exercisable (in shares) | shares | 362 |
Price Range 4 [Member] | |
Range of Exercise Price, lower (in dollars per share) | $ 21 |
Range of Exercise Price, upper (in dollars per share) | 656.40 |
Options Outstanding, weighted average exercise price (in dollars per share) | $ 289.81 |
Options Outstanding, number of options (in shares) | shares | 58 |
Options Exercisable, weighted average exercise price (in dollars per share) | $ 289.81 |
Options Exercisable, weighted average remaining life in years (Year) | 255 days |
Options exercisable, number of options exercisable (in shares) | shares | 58 |
Note 10 - Stock Options - Summa
Note 10 - Stock Options - Summary of Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 6 Months Ended | 12 Months Ended | |||||
Jun. 30, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | ||||
Weighted Average Exercise Price, outstanding (in dollars per share) | $ 0.10 | $ 0.10 | $ 0.10 | ||||
Number of Options, outstanding (in shares) | 19,222 | 19,222 | 19,222 | ||||
Number of Options, exercised (in shares) | |||||||
Weighted Average Exercise Price, exercised (in dollars per share) | |||||||
Number of Options, cancelled (in shares) | |||||||
Weighted Average Exercise Price, cancelled (in dollars per share) | |||||||
Number of Options, outstanding (in shares) | 748,000 | 19,222 | 19,222 | 19,222 | |||
Weighted Average Exercise Price, outstanding (in dollars per share) | $ 24.95 | $ 0.10 | $ 0.10 | $ 0.10 | |||
Weighted Average Remaining Life in Years, outstanding (Year) | 6 years 73 days | 7 years 4 months 24 days | 8 years 4 months 24 days | 9 years 4 months 24 days | |||
Intrinsic Value, outstanding | $ 188 | $ 6,956 | [1] | $ 6,639 | [1] | ||
Options Outstanding, Vested and expected to vest (in shares) | 19,222 | ||||||
Weighted Average Exercise Price Per Share, Vested and expected to vest (in dollars per share) | $ 0.10 | ||||||
Weighted-average Remaining Contractual Life, Vested and expected to vest (Year) | 7 years 4 months 24 days | ||||||
Aggregate Intrinsic Value, Vested and expected to vest | [1] | $ 6,956 | |||||
Number of Options, exercisable (in shares) | 530,000 | 19,222,032 | |||||
Weighted Average Exercise Price, exercisable (in dollars per share) | $ 33.93 | $ 0.09 | |||||
Weighted Average Remaining Life in Years, exercisable (Year) | 5 years 255 days | 7 years 4 months 24 days | |||||
Intrinsic Value, exercisable | $ 188 | $ 4,119 | [1] | ||||
Shares Available For Grant, Balance (in shares) | 5,000 | 5,000 | 5,000 | ||||
Alliqua Biomedical, Inc. [Member] | |||||||
Number of Options, outstanding (in shares) | 11,000 | ||||||
Weighted Average Exercise Price, outstanding (in dollars per share) | $ 1,449.05 | ||||||
[1] | The aggregate intrinsic value is calculated as the difference between the stock option exercise price and the estimated fair value of the Company's common stock of $0.46 and $0.44 per share as of December 31, 2018 and 2017. |
Note 10 - Income Taxes (Details
Note 10 - Income Taxes (Details Textual) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Expense (Benefit), Total | $ 0 | $ 0 |
Deferred Income Tax Assets, Net, Total | 0 | |
Valuation Allowance, Deferred Tax Asset, Increase (Decrease), Amount | $ 1,200,000 | (964,000) |
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 21.00% | |
Tax Cuts and Jobs Act, Transition Tax for Accumulated Foreign Earnings, Liability, Total | $ 0 | |
Number of Foreign Subsidiaries | 0 | |
Operating Loss Carryforwards, Total | $ 33,500,000 | |
Operating Lease Carryforwards with Expiration Dates | 28,700,000 | |
Operating Loss Carryforwards Expiring Indefinitely | 4,800,000 | |
Unrecognized Tax Benefits, Income Tax Penalties and Interest Accrued, Total | $ 0 | |
Domestic Tax Authority [Member] | ||
Open Tax Year | 2014 2015 2016 2017 2018 | |
Research Tax Credit Carryforward [Member] | Domestic Tax Authority [Member] | Internal Revenue Service (IRS) [Member] | ||
Tax Credit Carryforward, Amount | $ 1,800,000 | |
Research Tax Credit Carryforward [Member] | State and Local Jurisdiction [Member] | ||
Tax Credit Carryforward, Amount | $ 700,000 | |
Earliest Tax Year [Member] | ||
Operating Loss Carryforwards, Expiration Date | Dec. 31, 2033 | |
Earliest Tax Year [Member] | Research Tax Credit Carryforward [Member] | Domestic Tax Authority [Member] | Internal Revenue Service (IRS) [Member] | ||
Tax Credit Carryforward, Expiration Date | Dec. 31, 2031 |
Note 10 - Income Taxes - Compon
Note 10 - Income Taxes - Components of Deferred Tax Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Note 10 - Income Taxes - Components of Deferred Tax Assets (Details) | ||
Net operating loss carry forward | $ 7,051 | $ 6,158 |
Research and development credits | 1,601 | 1,284 |
Accruals and reserves | 142 | 99 |
Fixed assets | 1 | |
Total deferred tax asset | 8,795 | 7,541 |
Valuation allowance | $ (8,795) | $ (7,541) |
Note 10 - Income Taxes - Activi
Note 10 - Income Taxes - Activity Related to Gross Unrecognized Tax Benefits (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Note 10 - Income Taxes - Activity Related to Gross Unrecognized Tax Benefits (Details) | |
Balance | $ 331 |
Changes related to prior year positions | 330 |
Increases related to current year positions | 42 |
Balance | $ 703 |
Note 11 - Related-party Trans_2
Note 11 - Related-party Transactions (Details Textual) - USD ($) | May 03, 2019 | Jun. 30, 2019 | Dec. 31, 2018 |
Chief Executive Officer [Member] | Severance Pay [Member] | |||
Related Party Transaction, Amounts of Transaction | $ 1,091,000 | ||
Majority Investors [Member] | |||
Notes Payable, Related Parties | $ 5,500,000 | ||
Debt Instrument, Face Amount | $ 4,500,000 | ||
Debt Instrument, Interest Rate, Stated Percentage | 8.00% | ||
Interest Payable | $ 126,000 |
Note 12 - Employee Benefit Pl_2
Note 12 - Employee Benefit Plan (Details Textual) - USD ($) | 12 Months Ended | 24 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2018 | |
Note To Financial Statement Details Textual | |||
Defined Contribution Plan, Non-elective Safe Harbor Contribution, Percentage of Annual Salary | 3.00% | ||
Defined Contribution Plan, Non-elective Safe Harbor Contribution, Amount | $ 49,000 | $ 54,000 |
Note 13 - Subsequent Events (De
Note 13 - Subsequent Events (Details Textual) | Aug. 02, 2019 | Aug. 01, 2019 | May 31, 2019USD ($) | May 03, 2019USD ($)shares | Aug. 31, 2019USD ($) | Jul. 31, 2019USD ($) | May 31, 2019USD ($) | Apr. 30, 2019USD ($) | Jan. 31, 2019USD ($) | Jun. 30, 2019USD ($) | Jun. 30, 2018USD ($) | Dec. 31, 2018USD ($) | Jun. 20, 2019USD ($) | Mar. 31, 2019USD ($) | Mar. 31, 2018USD ($) | Jan. 31, 2017USD ($) | Nov. 24, 2015 |
Proceeds from issuance of convertible promissory notes - related party | $ 3,996,000 | $ 1,500,000 | $ 4,500,000 | ||||||||||||||
Majority Investors [Member] | |||||||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 8.00% | ||||||||||||||||
Majority Investors [Member] | First Note to Fund the Company's Operations [Member] | |||||||||||||||||
Proceeds from Notes Payable, Total | $ 2,000,000 | ||||||||||||||||
Majority Investors [Member] | Second Note to Fund the Company's Operations [Member] | |||||||||||||||||
Proceeds from Notes Payable, Total | $ 500,000 | $ 500,000 | |||||||||||||||
Majority Investors [Member] | Notes to Fund the Company's Operations [Member] | |||||||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 8.00% | 8.00% | |||||||||||||||
Oxford Finance, LLC [Member] | Term Loans [Member] | |||||||||||||||||
Debt Instrument, Periodic Payment Terms, Increase (Decrease) in Balloon Payment to be Paid | $ 200,000 | $ 100,000 | |||||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 7.06% | ||||||||||||||||
Oxford Finance, LLC [Member] | Term Loans [Member] | Domain [Member] | |||||||||||||||||
Debt Instrument, Increase of Periodic Payments Upon Delivery of Executed Term Sheet | 240 days | ||||||||||||||||
Proceeds from Noncontrolling Interests | $ 20,000,000 | ||||||||||||||||
Restricted Cash, Total | $ 200,000 | ||||||||||||||||
Debt Instrument, Periodic Payment Terms, Increase (Decrease) in Balloon Payment to be Paid | $ 50,000 | $ 20,000 | |||||||||||||||
Subsequent Event [Member] | |||||||||||||||||
Merger Agreement, Percentage Ownership in Combined Company, Acquirer | 86.00% | ||||||||||||||||
Merger Agreement, Percentage Ownership in Combined Company, Acquiree | 14.00% | ||||||||||||||||
Subsequent Event [Member] | Minimum [Member] | |||||||||||||||||
Proceeds From Issuance Or Sale Of Equity | $ 1,000,000 | ||||||||||||||||
Subsequent Event [Member] | Reverse Stock Split [Member] | Minimum [Member] | |||||||||||||||||
Stockholders' Equity Note, Stock Split, Conversion Ratio | 2 | 2 | |||||||||||||||
Subsequent Event [Member] | Reverse Stock Split [Member] | Maximum [Member] | |||||||||||||||||
Stockholders' Equity Note, Stock Split, Conversion Ratio | 10 | 10 | |||||||||||||||
Subsequent Event [Member] | Conversion of Notes into Series B Convertible Preferred Stock [Member] | |||||||||||||||||
Debt Conversion, Original Debt, Amount, Principal | $ 3,000,000 | ||||||||||||||||
Debt Conversion, Original Debt, Amount, Cumulative Accrued Interest | $ 203,000 | ||||||||||||||||
Subsequent Event [Member] | Conversion of Notes into Series B Convertible Preferred Stock [Member] | Series B Convertible Preferred Stock [Member] | |||||||||||||||||
Debt Conversion, Converted Instrument, Shares Issued | shares | 10,223,996 | ||||||||||||||||
Subsequent Event [Member] | Domain [Member] | |||||||||||||||||
Proceeds from issuance of convertible promissory notes - related party | $ 600,000 | ||||||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 8.00% | ||||||||||||||||
Subsequent Event [Member] | Majority Investors [Member] | First Note to Fund the Company's Operations [Member] | |||||||||||||||||
Proceeds from Notes Payable, Total | $ 2,000,000 | ||||||||||||||||
Debt Instrument, Maturity Date | Apr. 26, 2020 | ||||||||||||||||
Subsequent Event [Member] | Majority Investors [Member] | Second Note to Fund the Company's Operations [Member] | |||||||||||||||||
Proceeds from Notes Payable, Total | $ 500,000 | ||||||||||||||||
Debt Instrument, Maturity Date | May 29, 2020 | ||||||||||||||||
Subsequent Event [Member] | Majority Investors [Member] | Notes to Fund the Company's Operations [Member] | |||||||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 8.00% | 8.00% | |||||||||||||||
Subsequent Event [Member] | Oxford Finance, LLC [Member] | Term Loans [Member] | Domain [Member] | |||||||||||||||||
Debt Instrument, Increase of Interest-Only Periodic Payments Upon Delivery of Executed Term Sheet | 60 days | ||||||||||||||||
Debt Instrument, Increase of Periodic Payments Upon Delivery of Executed Term Sheet | 240 days | ||||||||||||||||
Proceeds from Noncontrolling Interests | $ 20,000,000 | ||||||||||||||||
Restricted Cash, Total | $ 200,000 | ||||||||||||||||
Debt Instrument, Periodic Payment Terms, Increase (Decrease) in Balloon Payment to be Paid | $ 50,000 |