Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2017 | Nov. 07, 2017 | |
Document And Entity Information | ||
Entity Registrant Name | MABVAX THERAPEUTICS HOLDINGS, INC. | |
Entity Central Index Key | 1,109,196 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2017 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Is Entity a Well-known Seasoned Issuer? | No | |
Is Entity a Voluntary Filer? | No | |
Is Entity's Reporting Status Current? | Yes | |
Entity Filer Category | Smaller Reporting Company | |
Trading Symbol | MBVX | |
Entity Common Stock, Shares Outstanding | 20,588,765 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2,017 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) | Sep. 30, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 3,052,778 | $ 3,979,290 |
Prepaid expenses | 303,543 | 281,858 |
Other current assets | 118,454 | 32,830 |
Total current assets | 3,474,775 | 4,293,978 |
Property and equipment, net | 619,208 | 731,712 |
Goodwill | 6,826,003 | 6,826,003 |
Other long term assets | 178,597 | 168,597 |
Total assets | 11,098,583 | 12,020,290 |
Current liabilities: | ||
Accounts payable | 1,550,113 | 1,137,903 |
Accrued compensation | 742,285 | 770,592 |
Accrued clinical operations and site costs | 1,502,505 | 1,218,641 |
Accrued lease contingency fee | 590,504 | 590,504 |
Other accrued expenses | 255,098 | 315,034 |
Interest payable | 42,029 | 51,295 |
Current portion of notes payable | 1,693,065 | 1,589,661 |
Current portion of capital leases payable | 17,447 | 17,004 |
Total current liabilities | 6,393,046 | 5,690,634 |
Long-term liabilities: | ||
Long-term portion of notes payable, net | 1,957,657 | 2,774,627 |
Long-term portion of capital lease payable | 50,448 | 68,113 |
Other long-term liabilities | 177,016 | 144,394 |
Total long-term liabilities | 2,185,121 | 2,987,134 |
Total liabilities | 8,578,167 | 8,677,768 |
Commitments and contingencies: | ||
Stockholders’ Equity: | ||
Common stock, $0.01 par value; 150,000,000 shares authorized, 18,924,085 and 6,296,110 shares issued and outstanding as of September 30, 2017, and December 31, 2016, respectively | 189,241 | 62,961 |
Additional paid-in capital | 103,349,153 | 81,533,511 |
Accumulated deficit | (101,046,557) | (78,262,261) |
Total stockholders’ equity | 2,520,416 | 3,342,522 |
Total liabilities and stockholders’ equity | 11,098,583 | 12,020,290 |
Series D Convertible Preferred Stock [Member] | ||
Stockholders’ Equity: | ||
Preferred stock | 441 | 1,325 |
Series E Convertible Preferred Stock [Member] | ||
Stockholders’ Equity: | ||
Preferred stock | 333 | 333 |
Series F Convertible Preferred Stock [Member] | ||
Stockholders’ Equity: | ||
Preferred stock | 6,653 | 6,653 |
Series G Convertible Preferred Stock [Member] | ||
Stockholders’ Equity: | ||
Preferred stock | 1,000 | 0 |
Series H Convertible Preferred Stock [Member] | ||
Stockholders’ Equity: | ||
Preferred stock | 9 | 0 |
Series I Convertible Preferred Stock [Member] | ||
Stockholders’ Equity: | ||
Preferred stock | 10,485 | 0 |
Series J Convertible Preferred Stock [Member] | ||
Stockholders’ Equity: | ||
Preferred stock | 8 | 0 |
Series K Convertible Preferred Stock [Member] | ||
Stockholders’ Equity: | ||
Preferred stock | $ 650 | $ 0 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) | Sep. 30, 2017 | Dec. 31, 2016 |
Common stock, par value | $ .01 | $ .01 |
Common stock, shares authorized | 150,000,000 | 150,000,000 |
Common stock, shares issued | 18,924,085 | 6,296,110 |
Common stock, shares outstanding | 18,924,085 | 6,296,110 |
Series D Convertible Preferred Stock [Member] | ||
Convertible preferred stock, par value | $ .01 | $ .01 |
Convertible preferred stock, shares authorized | 1,000,000 | 1,000,000 |
Convertible preferred stock, shares issued | 44,104 | 132,489 |
Convertible preferred stock, shares outstanding | 44,104 | 132,489 |
Convertible preferred stock, liquidation preference | $ 441 | $ 1,325 |
Series E Convertible Preferred Stock [Member] | ||
Convertible preferred stock, par value | $ .01 | $ .01 |
Convertible preferred stock, shares authorized | 100,000 | 100,000 |
Convertible preferred stock, shares issued | 33,333 | 33,333 |
Convertible preferred stock, shares outstanding | 33,333 | 33,333 |
Convertible preferred stock, liquidation preference | $ 333 | $ 333 |
Series F Convertible Preferred Stock [Member] | ||
Convertible preferred stock, par value | $ .01 | $ .01 |
Convertible preferred stock, shares authorized | 1,559,252 | 1,559,252 |
Convertible preferred stock, shares issued | 665,281 | 665,281 |
Convertible preferred stock, shares outstanding | 665,281 | 665,281 |
Convertible preferred stock, liquidation preference | $ 6,653 | $ 6,653 |
Series G Convertible Preferred Stock [Member] | ||
Convertible preferred stock, par value | $ 0.01 | $ 0.01 |
Convertible preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Convertible preferred stock, shares issued | 1,000,000 | 0 |
Convertible preferred stock, shares outstanding | 1,000,000 | 0 |
Convertible preferred stock, liquidation preference | $ 10,000 | $ 0 |
Series H Convertible Preferred Stock [Member] | ||
Convertible preferred stock, par value | $ 0.01 | $ 0.01 |
Convertible preferred stock, shares authorized | 2,000 | 2,000 |
Convertible preferred stock, shares issued | 850 | 0 |
Convertible preferred stock, shares outstanding | 850 | 0 |
Convertible preferred stock, liquidation preference | $ 850,000 | $ 0 |
Series I Convertible Preferred Stock [Member] | ||
Convertible preferred stock, par value | $ 0.01 | $ 0.01 |
Convertible preferred stock, shares authorized | 1,968,664 | 1,968,664 |
Convertible preferred stock, shares issued | 1,048,460 | 0 |
Convertible preferred stock, shares outstanding | 1,048,460 | 0 |
Convertible preferred stock, liquidation preference | $ 10,485 | $ 0 |
Series J Convertible Preferred Stock [Member] | ||
Convertible preferred stock, par value | $ .01 | $ .01 |
Convertible preferred stock, shares authorized | 3,400 | 3,400 |
Convertible preferred stock, shares issued | 818.18 | 0 |
Convertible preferred stock, shares outstanding | 818.18 | 0 |
Convertible preferred stock, liquidation preference | $ 562,500 | $ 0 |
Series K Convertible Preferred Stock [Member] | ||
Convertible preferred stock, par value | $ .01 | $ .01 |
Convertible preferred stock, shares authorized | 65,000 | 65,000 |
Convertible preferred stock, shares issued | 65,000 | 0 |
Convertible preferred stock, shares outstanding | 65,000 | 0 |
Convertible preferred stock, liquidation preference | $ 650 | $ 0 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Revenues: | ||||
Grants | $ 0 | $ 0 | $ 0 | $ 148,054 |
Total revenues | 0 | 0 | 0 | 148,054 |
Operating costs and expenses: | ||||
Research and development | 1,017,061 | 1,671,181 | 6,168,125 | 4,967,695 |
General and administrative | 1,831,629 | 2,420,516 | 7,513,621 | 7,001,521 |
Total operating costs and expenses | 2,848,690 | 4,091,697 | 13,681,746 | 11,969,216 |
Loss from operations | (2,848,690) | (4,091,697) | (13,681,746) | (11,821,162) |
Interest and other expense | (231,471) | (266,051) | (743,137) | (729,331) |
Net loss | (3,080,161) | (4,357,748) | (14,424,883) | (12,550,493) |
Deemed dividend on inducement shares | 0 | 0 | (5,220,000) | 0 |
Deemed dividend on incentive shares | (3,120,000) | 0 | (3,120,000) | 0 |
Deemed dividend on warrant reprice | 0 | 0 | (19,413) | 0 |
Net loss allocable to common stockholders | $ (6,200,161) | $ (4,357,748) | $ (22,784,296) | $ (12,550,493) |
Basic and diluted net loss per share | $ (2.68) | $ (0.86) | $ (.54) | $ (2.87) |
Shares used to calculate basic and diluted net loss per share | 11,490,839 | 5,041,408 | 8,504,076 | 4,374,801 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Stockholders' Equity (Unaudited) - 9 months ended Sep. 30, 2017 - USD ($) | Preferred Stock [Member] | Common Stock | Additional Paid-In Capital | Accumulated Deficit | Total |
Beginning Balance, Shares at Dec. 31, 2016 | 831,103 | 6,296,110 | |||
Beginning Balance, Amount at Dec. 31, 2016 | $ 8,311 | $ 62,961 | $ 81,533,511 | $ (78,262,261) | $ 3,342,522 |
Private placement, net of costs, Shares | 850 | ||||
Private placement, net of costs, Amount | $ 9 | 820,562 | 820,571 | ||
Underwritten offering, net of costs, Shares | 1,000,000 | 1,342,858 | |||
Underwritten offering, net of costs, Amount | $ 10,000 | $ 13,429 | 3,623,962 | 3,647,391 | |
Private placement, net of costs, Shares | 152,143 | ||||
Private placement, net of costs, Amount | $ 1,521 | 123,479 | 125,000 | ||
Underwritten offering, net of costs, Shares | 2,386 | ||||
Underwritten offering, net of costs, Amount | $ 24 | 1,189,393 | 1,189,417 | ||
Registered Direct offering, net of costs, Shares | 4,000,000 | ||||
Registered Direct offering, net of costs, Amount | $ 40,000 | 1,812,361 | 1,852,361 | ||
Registered Direct offering, net of costs, Shares | 2,016,129 | ||||
Registered Direct offering, net of costs, Amount | $ 20,162 | 1,194,838 | 1,215,000 | ||
Issuance of inducement shares, Shares | 1,968,664 | 931,336 | |||
Issuance of inducement shares, Amount | $ 19,687 | $ 9,313 | (29,000) | 0 | |
Deemed dividends on inducement shares | 5,220,000 | (5,220,000) | 0 | ||
Deemed dividends on incentive shares, Shares | 65,000 | ||||
Deemed dividends on incentive shares, Amount | $ 650 | 3,119,350 | (3,120,000) | 0 | |
Repricing of warrants | 19,413 | (19,413) | 0 | ||
Stock issued for services, Shares | 400,000 | ||||
Stock issued for services, Amount | $ 4,000 | 232,666 | 236,666 | ||
Preferred stock conversions - Series D, Shares | (88,385) | 1,194,391 | |||
Preferred stock conversions - Series D, Amount | $ (884) | $ 11,944 | (11,060) | 0 | |
Preferred stock conversions - Series I, Shares | (920,204) | 920,204 | |||
Preferred stock conversions - Series I, Amount | $ (9,202) | $ 9,202 | 0 | ||
Preferred stock conversions - Series J, Shares | (1,568) | 1,568,171 | |||
Preferred stock conversions - Series J, Amount | $ (16) | $ 15,682 | (15,666) | 0 | |
Stock issued upon vesting of RSUs, Shares | 102,743 | ||||
Stock issued upon vesting of RSUs, Amount | $ 102,743 | (1,027) | 0 | ||
Stock-based compensation | 4,516,371 | 4,516,371 | |||
Net loss | (14,424,883) | (14,424,883) | |||
Ending Balance, Shares at Sep. 30, 2017 | 2,857,846 | 18,924,085 | |||
Ending Balance, Amount at Sep. 30, 2017 | $ 28,579 | $ 189,241 | $ 103,349,153 | $ 101,046,557 | $ 2,520,416 |
Condensed Consolidated Stateme6
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Operating activities | ||
Net loss | $ (14,424,883) | $ (12,550,493) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 122,315 | 60,058 |
Stock-based compensation | 4,516,371 | 3,459,992 |
Issuance of restricted stock for services | 236,666 | 164,000 |
Amortization and accretion related to notes payable | 309,213 | 337,151 |
Increase (decrease) in operating assets and liabilities: | ||
Grant receivable | 0 | 757,562 |
Other receivables | (7,061) | 0 |
Prepaid expenses and other | (62,672) | 122,522 |
Accounts payable | 403,210 | (2,476,130) |
Accrued clinical operations and site costs | 283,864 | 275,105 |
Accrued compensation | (28,307) | 77,437 |
Other accrued expenses | (51,649) | 150,487 |
Net cash used in operating activities | (8,702,932) | (9,622,309) |
Investing activities | ||
Purchases of property and equipment | (21,072) | (412,498) |
Net cash used in investing activities | (21,072) | (412,498) |
Financing activities | ||
Cash receipt from bank loan, net of financing costs | 0 | 4,610,324 |
Private offering, net of issuance costs | 820,571 | 0 |
Underwritten offering, net of issuance costs | 3,647,391 | 8,572,343 |
Private offering, net of issuance costs | 125,000 | 0 |
Underwritten offering, net of issuance costs | 1,189,417 | 0 |
Registered direct offering, net of issuance costs | 1,852,361 | 0 |
Registered direct offering, net of issuance costs | 1,215,000 | 0 |
Principal payments on bank loan | (972,223) | 0 |
Principal payments of financed insurance policies | (69,240) | (106,405) |
Principal payments on capital lease | (10,785) | (6,504) |
Purchase of vested employee stock in connection with tax withholding obligation | 0 | (177,823) |
Net cash provided by financing activities | 7,797,492 | 12,891,935 |
Net change in cash and cash equivalents | (926,512) | 2,857,128 |
Cash and cash equivalents at beginning of period | 3,979,290 | 4,084,085 |
Cash and cash equivalents at end of period | 3,052,778 | 6,941,213 |
Supplemental disclosure: | ||
Cash paid during the period for income taxes | 1,600 | 1,600 |
Cash paid during the period for interest on term note | 443,495 | 379,560 |
Supplemental disclosures of non-cash investing and financing information: | ||
Purchase of equipment in accounts payable | 0 | 82,006 |
Fair value of warrants issued | 0 | 607,338 |
Fair value of repricing of warrants issued in previous financing | 19,413 | 0 |
Conversion of Series D preferred stock to common stock | 11,944 | 7,974 |
Conversion of Series I preferred stock to common stock | 9,202 | 0 |
Conversion of Series J preferred stock to common stock | 15,682 | 0 |
Deemed dividends on inducement shares | 5,220,000 | 0 |
Deemed dividends on incentive shares | 3,120,000 | 0 |
Capital lease in connection with purchase of equipment | 0 | 95,656 |
Financing transaction costs not yet paid | $ 52,317 | $ 2,500 |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Sep. 30, 2017 | |
Notes to Financial Statements | |
Basis of Presentation | We are a Delaware corporation, originally incorporated in 1988 under the name Terrapin Diagnostics, Inc. in the State of Delaware, and subsequently renamed “Telik, Inc.” in 1998, and thereafter renamed MabVax Therapeutics Holdings, Inc. (“MabVax”) in September 2014. Our principal corporate office is located at 11535 Sorrento Valley Road, Suite 400, San Diego, CA 92121 telephone: (858) 259-9405. On July 8, 2014, we consummated a merger with MabVax Therapeutics, Inc. (“MabVax Therapeutics”), pursuant to which our subsidiary Tacoma Acquisition Corp. merged with and into MabVax Therapeutics, with MabVax Therapeutics surviving as our wholly owned subsidiary. This transaction is referred to as the “Merger.” Unless the context otherwise requires, references to “we,” “our,” “us,” or the “Company” in this Quarterly Report mean MabVax Therapeutics Holdings, Inc. on a condensed consolidated financial statement basis with our wholly-owned subsidiary following the Merger, MabVax Therapeutics, as applicable. Beginning October 10, 2014, our common stock was quoted on the OTCQB under the symbol “MBVX.” Since August 17, 2016, our common stock has been trading on the NASDAQ Capital Market under the symbol “MBVX.” The balance sheet data at December 31, 2016, has been derived from audited financial statements at that date. It does not include, however, all the information and notes required by accounting principles generally accepted in the United States of America (“GAAP”) for complete financial statements. The condensed consolidated financial statements as presented reflect certain reclassifications from previously issued financial statements to conform to the current year presentation. On August 16, 2016, we filed a certificate of amendment to our Amended and Restated Certificate of Incorporation with the Secretary of State of the State of Delaware in order to effectuate a reverse stock split of our issued and outstanding common stock on a 1 for 7.4 basis, effective on August 16, 2016 (the “Reverse Stock Split”). The Reverse Stock Split was effective with The Financial Industry Regulatory Authority (FINRA) and the Company’s common stock began trading on the NASDAQ Capital Market at the open of business on August 17, 2016. All share and per share amounts, and number of shares of common stock into which each share of preferred stock will convert, in the financial statements and notes thereto have been retroactively adjusted for all periods presented to give effect to the Reverse Stock Split, including reclassifying an amount equal to the reduction in par value of common stock to additional paid-in capital. MabVax is a clinical stage biopharmaceutical company engaged in the discovery, development and commercialization of proprietary human monoclonal antibody products for the treatment of a variety of cancers. We have discovered a pipeline of human monoclonal antibody products based on the protective immune responses generated by patients who have been vaccinated against targeted cancers with our proprietary vaccines. We have the exclusive license to the vaccines from Memorial Sloan Kettering Cancer Center (“MSK”). We operate in only one business segment. We have incurred net losses since inception and expect to incur substantial losses for the foreseeable future as we continue our research, development and clinical activities. To date, we have funded operations primarily through government grants, proceeds from the sale of common and preferred stock, the issuance of debt, the issuance of common stock in lieu of cash for services, payments from collaborators, and interest income. The process of developing products will require significant additional research and development, preclinical testing and clinical trials, as well as regulatory approvals. We expect these activities, together with general and administrative expenses, to result in substantial operating losses for the foreseeable future. We will not receive substantial revenue unless we or our collaborative partners complete clinical trials, obtain regulatory approvals and successfully commercialize one or more products; or we license our technology after achieving one or more milestones of interest to a potential partner. The accompanying unaudited condensed consolidated financial statements were prepared using GAAP for interim financial information and the instructions to Regulation S-X. While these statements reflect all normal recurring adjustments, which are, in the opinion of management, necessary for a fair presentation of the results of the interim period, they do not include all information or notes required by GAAP for annual financial statements and should be read in conjunction with the Audited Financial Statements of MabVax Therapeutics Holdings, Inc. for the year ended December 31, 2016, filed in our Annual Report on Form 10-K on March 1, 2017. The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of expenses during the reporting period. Management believes that these estimates are reasonable; however, actual results may differ from these estimates. Recent Accounting Pronouncements In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606) which contains new accounting literature relating to how and when a company recognizes revenue. Under ASU 2014-09, a company will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods and services. ASU 2014-09 is effective for the Company’s fiscal year beginning January 1, 2018, which reflects a one year deferral approved by the FASB in July 2015, and will be adopted by the Company beginning January 1, 2018. In February 2016, the FASB issued ASU 2016-2, “Leases (Topic 842).” This update will increase transparency and comparability by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. Under the new guidance, lessees will be required to recognize the following for all leases (with the exception of short-term leases) at the commencement date (i) a lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis; and (ii) a right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. Under the new guidance, lessor accounting is largely unchanged, and it simplified the accounting for sale and leaseback transactions. Lessees will no longer be provided with a source of off-balance sheet financing. Lessees (for capital and operating leases) and lessors (for sales-type, direct financing, and operating leases) must apply a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The modified retrospective approach would not require any transition accounting for leases that expired before the earliest comparative period presented. Lessees and lessors may not apply a full retrospective transition approach. The standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. We are currently in the process of assessing what impact this new standard may have on our condensed consolidated financial statements. In March 2016, the FASB issued ASU 2016-09, “Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting.” This update includes multiple provisions intended to simplify various aspects of the accounting for share-based payment transactions including accounting for excess tax benefits and tax deficiencies, classification of excess tax benefits in the statement of cash flows and accounting for award forfeitures. This update is effective for annual and interim reporting periods of public entities beginning after December 15, 2016, with early adoption permitted. The adoption of this new standard did not have a material impact on our condensed consolidated financial statements. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments—Credit Losses (Topic326): Measurement of Credit Losses on Financial Instruments. This ASU requires instruments measured at amortized cost to be presented at the net amount expected to be collected. Entities are also required to record allowances for available-for-sale debt securities rather than reduce the carrying amount. This ASU is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. In August 2016, the FASB issued ASU No. 2016-15 (“ASU 2016-15”), “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments.” The standard provides guidance on eight (8) cash flow issues: (1) debt prepayment or debt extinguishment costs; (2) settlement of zero-coupon bonds; (3) contingent consideration payments after a business combination; (4) proceeds from the settlement of insurance claims; (5) proceeds from the settlement of corporate-owned life insurance policies; (6) distributions received from equity method investees; (7) beneficial interests in securitization transactions; and (8) separately identifiable cash flows and application of the predominance principle. ASU 2016-15 addresses how certain cash receipts and cash payments are presented and classified in the statement of cash flows. ASU 2016-15 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2017 with early adoption permitted. We expect the adoption of this new standard will not have a material impact on our condensed consolidated financial statements. In August 2016, the FASB issued ASU No. 2016-16, “Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory . In January 2017, the FASB issued ASU No. 2017-03, “Accounting Changes and Error Corrections (Topic 250) and Investments—Equity Method and Joint Ventures (Topic 323).” This ASU amends the disclosure requirements for ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), ASU No. 2016-02, Leases (Topic 842) and ASU No. 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. This ASU states that if a registrant does not know or cannot reasonably estimate the impact that the adoption of the above ASUs is expected to have on the financial statements, then in addition to making a statement to that effect, the registrant should consider additional qualitative financial statement disclosures to assist the reader in assessing the significance of the impact that the standard will have on the financial statements of the registrant when adopted. This ASU was effective upon issuance. In January 2017, the FASB issued ASU No. 2017-04, “Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment.” This ASU eliminates Step 2 from the goodwill impairment test. Instead, an entity should recognize an impairment charge for the amount by which the carrying value exceeds the reporting unit’s fair value, not to exceed the total amount of goodwill allocated to that reporting unit. This ASU is effective for annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019. In January 2017, the FASB issued ASU No. 2017-01, “Business Combinations (Topic 805): Clarifying the Definition of a Business.” This ASU clarifies the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. This ASU is effective for annual periods beginning after December 15, 2017, including interim periods within those periods. Management believes that any other recently issued, but not yet effective, accounting standards if currently adopted would not have a material effect on the accompanying condensed consolidated financial statements. |
Liquidity and Going Concern
Liquidity and Going Concern | 9 Months Ended |
Sep. 30, 2017 | |
Notes to Financial Statements | |
Liquidity and Going Concern | The accompanying condensed consolidated financial statements have been prepared on the going concern basis, which assumes that the Company will continue to operate as a going concern and which contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of business. As reflected in the accompanying condensed consolidated financial statements, the Company had a net loss of $14,424,883, net cash used in operating activities of $8,702,932, net cash used in investing activities of $21,072, and net cash provided by financing activities of $7,797,492 for the nine months ended September 30, 2017. As of September 30, 2017, the Company had $3,052,778 in cash and cash equivalents, a working capital deficit of $2,918,271, an accumulated deficit of $101,046,557 and stockholders’ equity of $2,520,416. On January 15, 2016, we and Oxford Finance, LLC, as collateral agent and lender, entered into a Loan and Security Agreement (the “Loan Agreement”) providing for senior secured term loans to the Company in an aggregate principal amount of up to $10,000,000, subject to the terms and conditions set forth in the Loan Agreement (the “January 2016 Term Loan”). On January 15, 2016, the Company received an initial loan of $5,000,000 under the Loan Agreement, before fees and issuance costs of approximately $390,000. The option to draw the second $5,000,000 expired on September 30, 2016. On March 31, 2017, we and Oxford Finance, LLC, signed a First Amendment to the Loan Agreement (the “Amendment”), providing that the payment of principal of $138,889 on the January 2016 Term Loan that otherwise would have been due on the Amortization Date of April 1, 2017, will be due and payable on May 1, 2017 along with any other payment of principal due on May 1, 2017. We were obligated to pay a fully earned and non-refundable amendment fee of $15,000 to Oxford Finance LLC. On May 1, 2017, we paid the principal that was due on May 1, 2017, along with the $15,000 amendment fee. On May 3, 2017, we sold 850 shares of 0% Series H convertible preferred stock (the “Series H Preferred Stock”), . On May 19, 2017, we closed a public offering of 1,342,858 shares of common stock and 1,000,000 shares of newly designated 0% Series G convertible preferred stock (the “Series G Preferred Stock”), at $1.75 per share of common stock and Series G Preferred Stock (the “May 2017 Public Offering”). The Series G Preferred Stock is initially convertible into 1,000,000 shares of common stock, subject to adjustment for stock splits, stock dividends, recapitalizations, combinations, subdivisions or other similar events, to certain existing investors in the offering who, as a result of their purchases of common stock, would hold in excess of 4.99% of our issued and outstanding common stock, and elect to receive shares of our Series G Preferred Stock. We received $4,100,000 in gross proceeds, before underwriting discounts and commissions and offering expenses estimated at $452,609. The May 2017 Public Offering is described in more detail in Note 5, Convertible Preferred Stock, Common Stock and Warrants. On July 27, 2017, we entered into a subscription agreement with an accredited investor pursuant to which we agreed to sell 152,143 restricted shares of common stock for $125,000 (the “July 2017 Private Placement”). The July 2017 Private Placement closed on August 2, 2017. On August 11, 2017, we entered into a security purchase agreement with a group of existing investors in the Company, where we sold 2,386.36 shares of 0% Series J convertible preferred stock (“the Series J Preferred Stock”), . On August 23, 2017, we engaged Greenhill & Co. (NYSE: GHL) to serve as a financial advisor to assist us in exploring and evaluating strategic options with the goal of maximizing shareholder value. We are evaluating inbound inquiries and transaction options, as well as identifying new opportunities, which could include the acquisition of MabVax by another company, the sale or divestiture of specific assets coupled with a reverse merger, merging with another company, or licensing of selected technologies. We do not have a defined timeline for the exploration of strategic alternatives and are not confirming that the evaluation will result in any strategic alternative being announced or consummated. We do not intend to discuss or disclose further developments during this process unless and until our Board of Directors has approved a specific action or otherwise determined that further disclosure is appropriate. While Greenhill & Co. continues as our financial advisor, we will continue to advance our Phase 1 clinical programs including our MVT-1075 radioimmunotherapy clinical trial for the treatment of pancreatic, colon and lung cancers, and our MVT-5873 clinical trial in combination with one or more chemotherapy agents in first line therapy for patients newly diagnosed with pancreatic cancer. On September 14, 2017, the Company entered into subscription agreements with select accredited investors relating to the Company’s registered direct offering, issuance and sale of 4,000,000 shares of the Company’s common stock. The purchase price per share was $0.50. We received $2.0 million in gross proceeds, before offering expenses estimated at $147,639. The offering closed September 14, 2017. On September 22, 2017, the Company entered into additional subscription agreements with select accredited investors relating to the Company’s registered direct offering, issuance and sale of 2,016,129 shares of the Company’s common stock. The purchase price per share was $0.62. We received $1.25 million in gross proceeds, before offering expenses estimated at $35,000. The offering closed on September 27, 2017. On October 10, 2017, the Company entered into additional subscription agreements with select accredited investors relating to the Company’s registered direct offering, issuance and sale of 769,231 shares of the Company’s common stock. The purchase price per share was $0.65. We received $500,000 in gross proceeds, before offering expenses totaling approximately $15,000. The offering closed on October 11, 2017. We plan to continue to fund the Company’s losses from operations and capital funding needs through equity or debt financings, strategic collaborations, licensing arrangements, government grants or other arrangements. Further, to extend availability of existing cash available for our programs for the purpose of achieving milestones or a strategic transaction, we have cut personnel from 25 full time people to 10, and reduced other operating expenses following the completion of two phase 1a clinical trials of our lead antibody HuMab 5B1, which has enabled us to reduce our expenditures on clinical trials. We continue to develop our radioimmunotherapy product MVT-1075 discussed further in Management’s Discussion and Analysis of Financial Condition and Results of Operations. Several members of management have volunteered to defer receiving portions of their salaries until the earlier of achieving one or more business transactions or the end of 2017. However, we cannot be sure that capital funding will be available on reasonable terms, or at all. If we are unable to secure adequate additional funding, we may be forced to make additional reductions in spending, incur further cutbacks in personnel, extend payment terms with suppliers, liquidate assets where possible, and/or suspend or curtail planned programs. In addition, if the Company does not meet its payment obligations to third parties as they come due, it may be subject to litigation claims. Even if we are successful in defending against these claims, litigation could result in substantial costs and be a distraction to management. We anticipate that the Company will continue to incur net losses into the foreseeable future as we: (i) continue our clinical trial for the development of MVT1075 as a radioimmunotherapy, (ii) continue our clinical trial of MVT-5873 in combination with gemcitabine and nab-paclitaxal in first line therapy for the treatment of patients newly diagnosed with pancreatic cancer; and (iii) continue operations as a public company. Based on receipt of the $125,000 private placement in July 2017, and financings of $1.3 million in August 2017, $2.0 million on September 14, $1.25 million on September 22, 2017, and $500,000 on October 10, 2017, before offering expenses, and without any other additional funding or receipt of payments from potential licensing agreements, we expect we will have sufficient funds to meet our obligations until February 2018. These conditions give rise to substantial doubt as to the Company’s ability to continue as a going concern. Any of these actions could materially harm the Company’s business, results of operations, and prospects. The accompanying condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. If the Company raises additional funds by issuing equity securities, substantial dilution to existing stockholders would result. If the Company raises additional funds by incurring debt financing, the terms of the debt may involve significant cash payment obligations as well as covenants and specific financial ratios that may restrict the Company’s ability to operate its business. |
Cash and Cash Equivalents
Cash and Cash Equivalents | 9 Months Ended |
Sep. 30, 2017 | |
Cash and Cash Equivalents [Abstract] | |
Cash and Cash Equivalents | We consider all highly liquid investments purchased with original maturities of three months or less to be cash equivalents. The Company limits its exposure to credit loss by holding cash in U.S. dollars, or, from time to time, placing cash and investments in U.S. government, agency and government-sponsored enterprise obligations. |
Fair value of financial instrum
Fair value of financial instruments | 9 Months Ended |
Sep. 30, 2017 | |
Notes to Financial Statements | |
Fair value of financial instruments | Our financial instruments consist of cash and cash equivalents and accounts payable, both of which are generally considered to be representative of their respective fair values because of the short-term nature of those instruments. |
Convertible Preferred Stock, Co
Convertible Preferred Stock, Common Stock and Warrants | 9 Months Ended |
Sep. 30, 2017 | |
Notes to Financial Statements | |
Convertible Preferred Stock, Common Stock and Warrants | Dividends on Preferred Stock We immediately recognize the changes in the redemption value on preferred stock as they occur and the carrying value of the security is adjusted to equal what the redemption amount would be as if redemption were to occur at the end of the reporting date based on the conditions that exist as of that date. No dividends were ever declared by our Board of Directors since our inception on any series of convertible preferred stock. Series D Preferred Stock As of September 30, 2017, and December 31, 2016, there were 44,104 and 132,489 shares of Series D convertible preferred stock (“Series D Preferred Stock”) issued and outstanding that are convertible into an aggregate of 596,000 and 1,790,392 shares of common stock, respectively. The Series D Preferred Stock had been issued on March 25, 2015, to certain holders of the Company’s Series A-1 Preferred Stock and Merger warrants (the “Series A-1 Exchange Securities”) and holders of the Company’s Series B Preferred Stock and Series B warrants (the “Series B Exchange Securities” and, collectively with the Series A-1 Exchange Securities, the “Exchange Securities”), all previously issued by the Company. Pursuant to the exchange agreements, the holders exchanged the Exchange Securities and relinquished any and all other rights they may have had pursuant to the Exchange Securities, their respective governing agreements and certificates of designation, including any related registration rights, in exchange for an aggregate of 342,906 shares of the Company’s common stock and an aggregate of 238,156 shares of the Company’s newly designated Series D Preferred Stock, convertible into 3,218,325 shares of common stock. As contemplated by the exchange agreements and as approved by the Company’s Board of Directors, the Company filed with the Secretary of State of the State of Delaware a Certificate of Designation of Preferences, Rights and Limitations of Series D Convertible Preferred Stock (the “Series D Certificate of Designations”), on March 25, 2015. Pursuant to the Series D Certificate of Designations, the Company designated 1,000,000 shares of its blank check preferred stock as Series D Preferred Stock. Each share of Series D Preferred Stock has a stated value of $0.01 per share. In the event of a liquidation, dissolution or winding up of the Company, each share of Series D Preferred Stock will be entitled to a per share preferential payment equal to the stated value. Each share of Series D Preferred Stock is convertible into 13.5135 shares of common stock. The conversion ratio is subject to adjustment in the event of stock splits, stock dividends, combination of shares and similar recapitalization transactions. The Company is prohibited from effecting the conversion of the Series D Preferred Stock to the extent that, as a result of such conversion, the holder beneficially would own more than 4.99% (provided that certain investors elected to block their beneficial ownership initially at 2.49% in the exchange agreements), in the aggregate, of the issued and outstanding shares of the Company’s common stock calculated immediately after giving effect to the issuance of shares of common stock upon the conversion of the Series D Preferred Stock. Each share of Series D Preferred Stock entitles the holder to vote on all matters voted on by holders of common stock. With respect to any such vote, each share of Series D Preferred Stock entitles the holder to cast such number of votes equal to the number of shares of common stock such shares of Series D Preferred Stock are convertible into at such time, but not in excess of the beneficial ownership limitations. Series E Preferred Stock As of September 30, 2017, and December 31, 2016, there were 33,333 shares of Series E convertible preferred stock (“Series E Preferred Stock”) issued and outstanding, convertible into 519,751 shares of common stock. On March 30, 2015, the Company filed with the Secretary of State of the State of Delaware a Certificate of Designation of Preferences, Rights and Limitations of Series E Convertible Preferred Stock (the “Series E Certificate of Designations”) to designate 100,000 shares of its blank check preferred stock as Series E Preferred Stock. The shares of Series E Preferred Stock are convertible into shares of common stock based on a conversion calculation equal to the stated value of such preferred share, plus all accrued and unpaid dividends, if any, on such share of Series E Preferred Stock, as of such date of determination, divided by the conversion price. The stated value of each share of Series E Preferred Stock is $75 and the initial conversion price is $5.55 per share, each subject to adjustment for stock splits, stock dividends, recapitalizations, combinations, subdivisions or other similar events. In addition, during the period proscribed for in the Series E Certificate of Designations, in the event the Company issues or sells, or is deemed to issue or sell, shares of common stock at a per share price that is less than the conversion price then in effect, the conversion price shall be reduced to such lower price, subject to certain exceptions. The Company is prohibited from effecting a conversion of the share of Series E Preferred Stock to the extent that, as a result of such conversion, such holder would beneficially own more than 4.99% of the number of shares of common stock outstanding immediately after giving effect to the issuance of shares of common stock upon conversion of the Series E Preferred Stock, which beneficial ownership limitation may be increased by the holder up to, but not exceeding, 9.99%. Each holder is entitled to vote on all matters submitted to stockholders of the Company, and shall have the number of votes equal to the number of shares of common stock issuable upon conversion of such holder’s share of Series E Preferred Stock, but not in excess of beneficial ownership limitations. The shares of Series E Preferred Stock bear no interest. On August 22, 2016, when the Company closed on the August 2016 Public Offering, the current Series E Preferred Stock conversion price of $5.55 per share was reduced to $4.81 per share under the terms of the Series E Certificate of Designations, resulting in an increase in the number of shares of common stock to 519,751 that the Series E Preferred Stock may be converted into. There is no further adjustment required by the Series E Certificate of Designations in the event of an offering of shares below $4.81 per share by the Company. Series F Preferred Stock As of September 30, 2017, and December 31, 2016, there were 665,281 shares of Series F convertible preferred stock (the “Series F Preferred Stock”), par value of $0.01 per share, issued and outstanding, convertible into 665,281 shares of common stock. On August 16, 2016, we filed a Certificate of Designations, Preferences and Rights of the 0% Series F Convertible Preferred Stock with the Delaware Secretary of State, designating 1,559,252 shares of preferred stock as 0% Series F Preferred Stock. The shares of Series F Preferred Stock are convertible into shares of common stock based on a conversion calculation equal to the stated value of such Series F Preferred Stock, plus all accrued and unpaid dividends, if any, on such Series F Preferred Stock, as of such date of determination, divided by the conversion price. The stated value of each share of Series F Preferred Stock is $4.81 and the initial conversion price is $4.81 per share, each subject to adjustment for stock splits, stock dividends, recapitalizations, combinations, subdivisions or other similar events. In the event of a liquidation, dissolution or winding up of the Company, each share of Series F Preferred Stock will be entitled to a per share preferential payment equal to the par value. All shares of the Company’s capital stock will be junior in rank to Series F Preferred Stock with respect to the preferences as to dividends, distributions and payments upon the liquidation, dissolution and winding-up of the Company, except for the Company’s Series D Preferred Stock and Series E Preferred Stock. The holders of Series F Preferred Stock will be entitled to receive dividends if and when declared by our Board of Directors. The Series F Preferred Stock shall participate on an “as converted” basis, with all dividends declared on the Company’s common stock. In addition, if we grant, issue or sell any rights to purchase our securities pro rata to all our record holders of our common stock, each holder will be entitled to acquire such securities applicable to the granted purchase rights as if the holder had held the number of shares of common stock acquirable upon complete conversion of all Series F Preferred Stock then held. We are prohibited from effecting a conversion of the Series F Preferred Stock to the extent that, as a result of such conversion, the holder would beneficially own more than 4.99% of the number of shares of common stock outstanding immediately after giving effect to the issuance of shares of common stock upon conversion of the Series F Preferred Stock, which beneficial ownership limitation may be increased by the holder up to, but not exceeding, 9.99%. Each holder is entitled to vote on all matters submitted to stockholders of the Company, and shall have the number of votes equal to the number of shares of common stock issuable upon conversion of such holder’s Series F Preferred Stock, but not in excess of the beneficial ownership limitations. Series G Preferred Stock As of September 30, 2017, and December 31, 2016, there were 1,000,000 and no shares of our Series G Preferred Stock issued and outstanding and convertible into 1,000,000 and no shares of our common stock, respectively. Pursuant to a Series G Preferred Stock Certificate of Designations, on May 15, 2017, we designated 5,000,000 shares of our blank check preferred stock as Series G Preferred Stock, par value of $0.01 per share. The shares of Series G Preferred Stock are convertible into shares of common stock based on a conversion calculation equal to the stated value of the of such Series G Preferred Stock, plus all accrued and unpaid dividends, if any, on such Series G Preferred Stock, as of such date of determination, divided by the conversion price. The stated value of each share of Series G Preferred Stock is $1.75 and the initial conversion price is $1.75 per share, each subject to adjustment for stock splits, stock dividends, recapitalizations, combinations, subdivisions or other similar events. The holder of a majority of the Series G Preferred Stock shall have the right to nominate a candidate for the Board, such right to expire on December 31, 2017. In the event of a liquidation, dissolution or winding up of the Company, each share of Series G Preferred Stock will be entitled to a per share preferential payment equal to the par value. All shares our capital stock will be junior in rank to Series G Preferred Stock with respect to the preferences as to dividends, distributions and payments upon the liquidation, dissolution and winding-up of the Company, except for the Company’s Series D Preferred Stock, Series E Preferred Stock and Series F Preferred Stock. We are prohibited from effecting a conversion of the Series G Preferred Stock to the extent that, as a result of such conversion, the holder would beneficially own more than 4.99% of the number of shares of common stock outstanding immediately after giving effect to the issuance of shares of common stock upon conversion of the Series G Preferred Stock, which beneficial ownership limitation may be increased by the holder up to, but not exceeding, 9.99%. Each holder is entitled to vote on all matters submitted to stockholders of the Company, and shall have the number of votes equal to the number of shares of common stock issuable upon conversion of such holder’s Series G Preferred Stock, but not in excess of the beneficial ownership limitations. Series H Preferred Stock As of September 30, 2017, and December 31, 2016, there were 850 and no shares of our Series H Preferred Stock issued and outstanding and convertible into 485,714 and no shares of our common stock, respectively. Pursuant to a Series H Preferred Stock Certificate of Designations, on May 3, 2017, we designated 2,000 shares of our blank check preferred stock as Series H Preferred Stock, par value of $0.01 per share. The shares of Series H Preferred Stock are convertible into shares of common stock based on a conversion calculation equal to the stated value of the Series H Preferred Stock, plus the base amount, if any, on such Series H Preferred Stock, as of such date of determination, divided by the conversion price. The stated value of each share of Series H Preferred Stock is $1,000 and the initial conversion price is $1.75 per share, each subject to adjustment for stock splits, stock dividends, recapitalizations, combinations, subdivisions or other similar events. In the event of a liquidation, dissolution or winding up of the Company, each share of Series H Preferred Stock will be entitled to a per share preferential payment equal to the base amount. All shares of our capital stock will be junior in rank to Series H Preferred Stock with respect to the preferences as to dividends, distributions and payments upon the liquidation, dissolution and winding-up of the Company other than Series A through G Preferred Stock. We are prohibited from effecting a conversion of the Series H Preferred Stock to the extent that, as a result of such conversion, the holder would beneficially own more than 4.99% of the number of shares of common stock outstanding immediately after giving effect to the issuance of shares of common stock upon conversion of the Series H Preferred Stock, which beneficial ownership limitation may be increased by the holder up to, but not exceeding, 9.99%. Each holder is entitled to vote on all matters submitted to stockholders of the Company, and shall have the number of votes equal to the number of shares of common stock issuable upon conversion of such holder’s Series H Preferred Stock, but not in excess of the beneficial ownership limitations. Series I Preferred Stock As of September 30, 2017, and December 31, 2016, there were 1,048,460 and no shares of our Series I convertible preferred stock (the “Series I Preferred Stock”) issued and outstanding and convertible into 1,048,460 and no shares of our common stock, respectively. Pursuant to a Series I Preferred Stock Certificate of Designations, on May 26, 2017, we designated 1,968,664 shares of our blank check preferred stock as Series I Preferred Stock, par value of $0.01 per share. Each share of Series I Preferred Stock has a stated value of $0.01 per share. In the event of a liquidation, dissolution or winding up of the Company, each share of Series I Preferred Stock will be entitled to a per share preferential payment equal to the stated value. Each share of Series I Preferred Stock is convertible into one share of common stock. The conversion ratio is subject to adjustment in the event of stock splits, stock dividends, combination of shares and similar recapitalization transactions. The Company is prohibited from effecting the conversion of the Series I Preferred Stock to the extent that, as a result of such conversion, the holder beneficially owns more than 4.99%, in the aggregate, of the issued and outstanding shares of the Company’s Common Stock calculated immediately after giving effect to the issuance of shares of Common Stock upon the conversion of the Series I Preferred Stock (the “Beneficial Ownership Limitation”), which beneficial ownership limitation may be increased by the holder up to, but not exceeding, 9.99%. Each share of Series I Preferred Stock entitles the holder to vote on all matters voted on by holders of Common Stock. With respect to any such vote, each share of Series I Preferred Stock entitles the holder to cast such number of votes equal to the number of shares of Common Stock such shares of Series I Preferred Stock are convertible into at such time, but not in excess of the Beneficial Ownership Limitation. Series J Preferred Stock As of September 30, 2017, and December 31, 2016, there were 818.18 and no shares of our Series J Preferred Stock issued and outstanding and convertible into 818,180 and no shares of our common stock, respectively. On August 14, 2017, the Company filed a Certificate of Designations, Preferences and Rights of the 0% Series J Convertible Preferred Stock with the Delaware Secretary of State, designating 3,400 shares of preferred stock as Series J Preferred Stock. The shares of Series J Preferred Stock are convertible into shares of common stock based on a conversion calculation equal to the stated value of the Series J Preferred Stock, plus all accrued and unpaid dividends, if any, on such Series J Preferred Stock, as of such date of determination, divided by the conversion price. The stated value of each share of Series J Preferred Stock is $550 and the initial conversion price is $0.55 per share, each subject to adjustment for stock splits, stock dividends, recapitalizations, combinations, subdivisions or other similar events. For so long as the holder has Series J Preferred Stock, if the Company sells, or is deemed to have sold, common stock, or common equivalent shares, for consideration per share less than the conversion price in effect immediately prior to the issuance (the “Lower Issuance Price”), then the conversion price in effect immediately prior to such issuance will be adjusted to the Lower Issuance Price, provided however the Lower Issuance Price shall not be less than $0.10. The holders of Series J Preferred Stock will be entitled to receive dividends if and when declared by our board of directors. The Series J Preferred Stock shall participate on an “as converted” basis, with all dividends declared on our common stock. In addition, if we grant, issue or sell any rights to purchase our securities pro rata to all our record holders of our common stock, each holder will be entitled to acquire such securities applicable to the granted purchase rights as if the holder had held the number of shares of common stock acquirable upon complete conversion of all Series J Preferred Stock then held. We are prohibited from effecting a conversion of the Series J Preferred Stock to the extent that, as a result of such conversion, the holder would beneficially own more than 4.99% of the number of shares of common stock outstanding immediately after giving effect to the issuance of shares of common stock upon conversion of the Series J Preferred Stock, which beneficial ownership limitation may be increased by the holder up to, but not exceeding, 9.99%. Each holder is entitled to vote on all matters submitted to stockholders of the Company, and shall have the number of votes equal to the number of shares of common stock issuable upon conversion of such holder’s Series J Preferred Stock, substituting the consolidated closing bid price of the common stock on August 10, 2017 for the then-applicable conversion price, and not in excess of the beneficial ownership limitations. The Company shall not be obligated to issue any shares of common stock upon conversion of the Series J Preferred Stock, and the holder of any shares of Series J Preferred Stock shall not have the right to receive upon conversion of any shares of the Series J Preferred Stock if the issuance of such shares of common stock would exceed the aggregate number of shares of common stock which the Company may issue upon conversion of the Series J Preferred Stock without breaching the Company's obligations under the rules or regulations of the Nasdaq Capital Market, which aggregate number equals 19.99% of the number of shares outstanding on the closing date, except that such limitation shall not apply in the event that the Company obtains the approval of its stockholders as required by the applicable rules of the Nasdaq Capital Market for issuances of common stock in excess of such amount. Such approval was obtained in October 2017. Holders of Series J Preferred Stock will be entitled to a preferential payment of cash per share equal to the greater of 125% of the base amount on the date of payment or the amount per share had the holders converted such preferred shares immediately prior to the date of payment upon the liquidation, dissolution or winding up of the affairs of the Company, or a consolidation or merger of the Company with or into any other corporation or corporations, or a sale of all or substantially all of the assets of the Company, or the effectuation by the Company of a transaction or series of transactions in which more than 50% of the voting shares of the Company is disposed of or conveyed. Series K Preferred Stock As of September 30, 2017, and December 31, 2016, there were 65,000 and no shares of our Series K convertible preferred stock (“Series K Preferred Stock”) issued and outstanding and convertible into 6,500,000 and no shares of our common stock, respectively. On August 14, 2017, the Company filed a Certificate of Designations, Preferences and Rights of the Series K Convertible Preferred Stock with the Delaware Secretary of State, designating 65,000 shares of preferred stock as Series K Preferred Stock. The shares of Series K Preferred Stock are convertible into shares of common stock based on a conversion calculation equal to the stated value of the Series K Preferred Stock divided by the conversion price. The stated value of each share of Series K Preferred Stock is $0.01 and the initial conversion price is $0.0001 per share, each subject to adjustment for stock splits, stock dividends, recapitalizations, combinations, subdivisions or other similar events. The holders of Series K Preferred Stock will be entitled to receive dividends if and when declared by our board of directors. The Series K Preferred Stock shall participate on an “as converted” basis, with all dividends declared on our common stock. In addition, if we grant, issue or sell any rights to purchase our securities pro rata to all our record holders of our common stock, each holder will be entitled to acquire such securities applicable to the granted purchase rights as if the holder had held the number of shares of common stock acquirable upon complete conversion of all Series K Preferred Stock then held. We are prohibited from effecting any conversion of the Series K Preferred Stock if the Company has not obtained shareholder approval for the full conversion of the Series J Preferred Stock and Series K Preferred Stock in accordance with the rules of the NASDAQ Capital Market or to the extent that, as a result of such conversion, the holder would beneficially own more than 4.99% of the number of shares of common stock outstanding immediately after giving effect to the issuance of shares of common stock upon conversion of the Series K Preferred Stock, which beneficial ownership limitation may be increased by the holder up to, but not exceeding, 9.99%. Each holder is entitled to vote on all matters submitted to stockholders of the Company, and shall have the number of votes equal to the number of shares of common stock issuable upon conversion of such holder’s Series K Preferred Stock, substituting the consolidated closing bid price of the common stock on August 10, 2017 for the then-applicable conversion price, and not in excess of the beneficial ownership limitations. Such approval was obtained in October 2017. Warrants Issued in Connection with April 2015 Private Placement As of September 30, 2017, there were warrants outstanding to purchase 481,036 shares at $11.10 per share and 324,324 shares at $2.00 per share; and as of December 31, 2016, there were warrants outstanding to purchase 805,361 shares of common stock at $11.10 per share. All of the warrants at $11.10 and $2.00 per share that were outstanding on September 30, 2017, expired on October 10, 2017. The warrants priced at $11.10 and $2.00 per share were remaining from our private offering in March and April 2015 (the “April 2015 Private Placement”) in which we sold $8,546,348 worth of units (the “Units”), net of $668,150 in issuance costs, of which $2,500,000 of the Units consisted of Series E Preferred Stock and the balance consisted of 1,660,271 shares of common stock, together with warrants to all investors to purchase 1,055,361 shares of common stock at $11.10 per share. Each Unit was sold at a purchase price of $5.55 per Unit. OPKO Health, Inc., the lead investor in the April 2015 Private Placement, purchased $2,500,000 worth of Units consisting of all of the shares of the Series E Preferred Stock. In connection with the May 2017 Public Offering, the Company had agreed to amend the terms of a portion of the outstanding warrants, or warrants to purchase 324,324 shares of common stock that had an exercise price of $11.10 per share, such that the amended warrants shall have an exercise price of $2.00 per share and no cashless exercise feature, for those investors who made a certain minimum required investment to qualify for repricing. After the repricing, the stock price never reached above $2.00 in order for the warrants to be exercised prior to the expiration date of October 10, 2017. Warrants Issued in Connection with October 2015 Public Offering As of September 30, 2017, and December 31, 2016, there were warrants outstanding to purchase 168,919 shares of common stock at $9.77 per share in connection with a public offering on October 5, 2015. The warrants at $9.77 per share were issued in connection with our public offering on October 5, 2015, which consisted of 337,838 shares of common stock and warrants to purchase 168,919 shares of common stock, at an offering price of $8.14 per share. For every two shares of common stock sold, the Company issued one warrant to purchase one share of common stock. We received $2,750,000 in gross proceeds, before underwriting discounts and commissions and offering expenses totaling approximately $586,608. The shares and warrants were separately issued and sold in equal proportions. The warrants are immediately exercisable, expire September 30, 2018, and have an exercise price of $9.77 per share. The warrants are not listed on any securities exchange or other trading market. August 2016 Registered Direct Offering As of September 30, 2017, there were warrants outstanding to purchase 436,332 shares at $5.55 per share and 436,332 shares at $6.29 per share. As of December 31, 2016, there were warrants outstanding to purchase 1,962,319 shares at $5.55 per share and 1,962,319 shares at $6.29 per share. The warrants at $5.55 per share and $6.29 per share were issued on August 22, 2016, in connection with a public offering of 1,297,038 shares of common stock and 665,281 shares of Series F preferred stock, and warrants to purchase 1,962,319 shares of common stock at $5.55 per share and warrants to purchase 1,962,319 shares of common stock at $6.29 per share, at an offering price of $4.81 per share. For every one share of common stock or Series F preferred stock sold, we issued one warrant to purchase one share of common stock at $5.55 per share and one warrant to purchase one share of common stock at $6.29 per share. We received $9,438,753 in gross proceeds, before underwriting discounts and commissions and offering expenses totaling $871,305. The gross proceeds include the underwriter’s over-allotment option, which it exercised on the closing date. May 2017 Private Placement On May 3, 2017, we entered into separate subscription agreements with accredited investors pursuant to which we sold an aggregate of $850,000, or 850 shares, of Series H Preferred Stock, . In the event of a liquidation, dissolution or winding up of the Company, each share of Series H Preferred Stock will be entitled to a per share preferential payment equal to the base amount. All shares of our capital stock will be junior in rank to Series H Preferred Stock with respect to the preferences as to dividends, distributions and payments upon the liquidation, dissolution and winding-up of the Company other than Series A through G Preferred Stock. We are prohibited from effecting a conversion of the Series H Preferred Stock to the extent that, as a result of such conversion, the holder would beneficially own more than 4.99% of the number of shares of common stock outstanding immediately after giving effect to the issuance of shares of common stock upon conversion of the Series H Preferred Stock, which beneficial ownership limitation may be increased by the holder up to, but not exceeding, 9.99%. Each holder is entitled to vote on all matters submitted to stockholders of the Company, and shall have the number of votes equal to the number of shares of common stock issuable upon conversion of such holder’s Series H Preferred Stock, but not in excess of the beneficial ownership limitations. The shares were offered and sold solely to “accredited investors” in reliance on the exemption from registration afforded by Rule 506 of Regulation D and Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”). On the closing date, we entered into registration rights agreements with each of the investors, pursuant to which we agreed to undertake to file a registration statement to register the resale of the shares within thirty (30) days following the closing date, to cause such registration statement to be declared effective by the Securities and Exchange Commission (“SEC”) within sixty (60) days of the closing date and to maintain the effectiveness of the registration statement until all of such shares have been sold or are otherwise able to be sold pursuant to Rule 144 under the Securities Act, without any restrictions. On May 10, 2017, we entered into exchange agreements with each of the holders of our Series H Preferred Stock representing an aggregate of $850,000 of our Series H Preferred Stock with such exchange to be effective on the closing of our May 2017 Public Offering. Prior to the closing of the May 2017 Public Offering, we and the holders rescinded and cancelled the exchange agreements and they have no force and effect and no transaction contemplated by the Exchange Agreements was consummated. May 2017 Public Offering On May 19, 2017, we closed a public offering of 1,342,858 shares of common stock and 1,000,000 shares of newly designated 0% Series G Convertible Preferred Stock, or Series G Preferred Stock, at $1.75 per share of common stock and Series G Preferred Stock, or the May 2017 Public Offering. The Series G Preferred Stock is initially convertible into 1,000,000 shares of common stock, subject to adjustment for stock splits, stock dividends, recapitalizations, combinations, subdivisions or other similar events and was purchased by certain existing investors of the Company who, as a result of their purchases of common stock, would hold in excess of 4.99% of our issued and outstanding common stock. We received $4,100,000 in gross proceeds, before estimated underwriting discounts, commissions and offering expenses of $452,609. The May 2017 Public Offering was consummated pursuant to an underwriting agreement that we signed on May 15, 2017, with Laidlaw & Company (UK) Ltd. (“Laidlaw”), as underwriter (the “Underwriter”) pursuant to which, among other things, we agreed to issue and sell to the Underwriter, and the Underwriter agreed to purchase from us, in an underwritten public offering, an aggregate of 1,342,858 shares of common stock and 1,000,000 shares of Series G Preferred Stock. We granted the Underwriters an option for a period of up to 45 days from the date of our prospectus to purchase up to an aggregate of 201,428 additional shares of our common stock at the public offering price of $1.75 per share, less the underwriting discount, solely to cover overallotments, which was not exercised. In connection with the May 2017 Public Offering, we agreed with the lead investor of the August 2016 Public Offering (the “August Lead Investor”) pursuant to a Letter Agreement, dated May 18, 2017, to issue the Inducement Shares to the investors in the August 2016 Public Offering (the “August 2016 Investors”), as incentive shares to those investors to make a minimum required investment in this public offering of at least 50% of their investment in the $9,400,000 August 2016 Public Offering, or the Minimum Required Investment, and who still hold 100% of the shares of common stock previously acquired. Such August 2016 Investors shall be entitled to receive their pro rata share of 2,900,000 shares |
Notes Payable
Notes Payable | 9 Months Ended |
Sep. 30, 2017 | |
Notes Payable | |
Notes Payable | On January 15, 2016, we entered into the Loan Agreement with Oxford Finance, LLC pursuant to which we had the option to borrow $10,000,000 in two equal tranches of $5,000,000 each. The first tranche of $5,000,000 was funded at close on January 15, 2016 (the “Term A Loan”). The option to fund the second tranche of $5,000,000 (the “Term B Loan”) was upon the Company achieving positive interim data on the Phase 1 HuMab-5B1 antibody trial in pancreatic cancer and successfully uplisting to either the NASDAQ Capital Market or NYSE MKT on or before September 30, 2016. The option for the Term B Loan expired on September 30, 2016. The Company is not pursuing completion of any additional debt financing with Oxford Finance, LLC at the present time. The interest rate for the Term A Loan is set on a monthly basis at the index rate plus 11.29%, where the index rate is the greater of the 30-day LIBOR rate or 0.21%. Interest is due on the first day of each month, in arrears, calculated based on a 360-day year. The loan is interest only for first year after funding, and the principal amount of the loan is amortized in equal principal payments, plus period interest, over the next 36 months. A facility fee of 1.0% or $100,000 was due at closing of the transaction, and was earned and paid by the Company on January 15, 2016. The Company is obligated to pay a $150,000 final payment upon completion of the term of the loan, and this amount is being accreted using the effective interest rate method over the term of the loan. Each of the term loans can be prepaid subject to a graduated prepayment fee, depending on the timing of the prepayment. Concurrent with the closing of the transaction, the Company issued 225,226 common stock purchase warrants to Oxford Finance, LLC with an exercise price of $5.55 per share. The warrants are exercisable for five years and may be exercised on a cashless basis, and expire on January 15, 2021. The Company recorded $607,338 for the fair value of the warrants as a debt discount within notes payable and an increase to additional paid-in capital on the Company’s balance sheet. We used the Black-Scholes-Merton valuation method to calculate the value of the warrants. The debt discount is being amortized as interest expense over the term of the loan using the effective interest method. We granted Oxford Finance, LLC a perfected first priority lien on all of the Company’s assets with a negative pledge on intellectual property. The Company paid Oxford Finance, LLC a good faith deposit of $50,000, which was applied towards the facility fee at closing. The Company agreed to pay all costs, fees and expenses incurred by Oxford Finance, LLC in the initiation and administration of the facilities including the cost of loan documentation. At the initial funding, the Company received net proceeds of approximately $4,610,000 after fees and expenses. These fees and expenses are being accounted for as a debt discount and classified within notes payable on the Company’s condensed consolidated balance sheet. The Company's transaction costs of approximately $390,000 are presented in the condensed consolidated balance sheet as a direct deduction from the carrying amount of the notes payable, consistent with debt discounts. Debt discounts, issuance costs and the final payment are being amortized or accreted as interest expense over the term of the loan using the effective interest method. The Loan Agreement also contains customary indemnification obligations and customary events of default, including, among other things, our failure to fulfill certain of the Company's obligations under the Loan Agreement, the occurrence of a material adverse change, which is defined as a material adverse change in the Company's business, operations, or condition (financial or otherwise), a material impairment of the prospect of repayment of any portion of the loan, or a material impairment in the perfection or priority of the Lenders’ lien in the collateral or in the value of such collateral. In the event of default by the Company under the Loan Agreement, the Lenders would be entitled to exercise their remedies thereunder, including the right to accelerate payment of the debt, upon which we may be required to repay all amounts then outstanding under the Loan Agreement, which could harm the Company's financial condition. On March 31, 2017, we and Oxford Finance, LLC signed the Amendment, providing that the payment of principal on the January 2016 Term Loan that otherwise would have been due on the Amortization Date will be due and payable on May 1, 2017 along with any other payment of principal due on May 1, 2017. We were obligated to pay a fully earned and non-refundable amendment fee of $15,000 to the Collateral Agent. On May 1, 2017, we paid the principal due on May 1, 2017, along with the $15,000 amendment fee. The Company was in compliance with all applicable covenants set forth in the Loan Agreement as of September 30, 2017. For the three and nine months ended September 30, 2017, the Company recorded interest expense related to the term loan of $138,642 and $445,934, respectively. For the three and nine months ended September 30, 2016, the Company recorded $266,057 and $729,350 in interest expense related to the term loan, respectively. The annual effective interest rate on the note payable, including the amortization of the debt discounts and accretion of the final payment, but excluding the warrant amortization, was approximately 12.3% and approximately 13.8% as of September 30, 2017 and 2016, respectively. In July 2017, we entered into two premium finance agreements with First Insurance of California for the financing of insurance premiums for our fiscal 2017-18 insurance policies in the amount of $183,584 and $33,755, for a total of $217,339 (the “Insurance Notes”). Future principal payments under the Loan Agreement and the Insurance Notes as of September 30, 2017, are as follows: Years ending December 31: 2017 (remaining) – [ be sure to include both Insurance Notes here $ 581,952 2018 1,666,667 2019 1,666,667 2020 138,889 Notes payable, balance as of September 30, 2017 4,054,175 Unamortized discount on notes payable (403,453 ) Notes payable, balance as of September 30, 2017 3,650,722 Current portion of notes payable (1,693,065 ) Non-current portion of notes payable $ 1,957,657 |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2017 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | On April 1, 2016, the Company entered into a two-year consulting agreement with Jeffrey Ravetch, M.D., Ph.D., a Board member until August 3, 2017, for work beginning January 1, 2016 through December 31, 2017, at a rate of $100,000 a year, in support of scientific and technical advice on the discovery and development of technology and products for the Company primarily related to monoclonal antibodies, corporate development, and corporate partnering efforts. In April 2016, the Company paid Dr. Ravetch $100,000 for services to be performed in 2016, and will pay quarterly thereafter beginning January 1, 2017. During the three and nine months ended September 30, 2017, the Company recorded $25,000 and $75,000, respectively, in consulting expenses, as part of general and administration expenses, related to this agreement, of which $25,000 is outstanding and included in other accrued expenses on the balance sheet as of September 30, 2017. On November 3, 2016, the Company granted 17,500 stock options to Jeffrey Ravetch, M.D., Ph.D., for his ongoing consulting services to the Company. The option award vests over a three-year period. During the three and nine months ended September 30, 2017, the Company recognized $3,900 and $11,572 of stock-based compensation expense, respectively, as part of general and administration expenses, related to this option grant. On May 19, 2017, the Company granted each director, other than J. David Hansen, Jeffrey Ravetch, a Board member at the time, and Philip Livingston, 50,000 options at market price, $1.80 on May 19, 2017, with immediate vesting for their continuing service to the Company, in exchange for giving up their Board fees for the remainder of the year. J. David Hansen and Jeffrey Ravetch were each granted 500,000 options and Philip Livingston was granted 50,000 options each at $2.00 exercise price per share with immediate vesting and no performance obligations. Options granted to J. David Hansen, CEO and Philip Livingston were granted as a condition of the May 2017 financing transaction. The 450,000 options granted to Dr. Ravetch in addition to the 50,000 options granted to other non-employee members of the Company’s Board of Directors were in recognition of the additional value provided by Dr. Ravetch as a scientific expert. During the three and nine months ended September 30, 2017, the Company recorded $0 and $1,480,089 in stock-based compensation expense, respectively, in general and administration expenses, related to these grants. |
Stock-based Activity
Stock-based Activity | 9 Months Ended |
Sep. 30, 2017 | |
Notes to Financial Statements | |
Stock-based Activity | Amendment of Equity Incentive Plan On March 31, 2015, the Company approved a Second Amended and Restated 2014 Employee, Director and Consultant Equity Incentive Plan (the “Plan”) to increase the number of shares reserved for issuance under the Plan from 21,362 to 1,129,837 shares of common stock. Additional changes to the Plan include: ● An “evergreen” provision to reserve additional shares for issuance under the Plan on an annual basis commencing on the first day of fiscal 2016 and ending on the second day of fiscal 2024, such that the number of shares that may be issued under the Plan shall be increased by an amount equal to the lesser of: (i) 1,081,081 or the equivalent of such number of shares after the administrator, in its sole discretion, has interpreted the effect of any stock split, stock dividend, combination, recapitalization or similar transaction in accordance with the Plan; (ii) the number of shares necessary such that the total shares reserved under the Plan equals (x) 15% of the number of outstanding shares of common stock on such date (assuming the conversion of all outstanding shares of Preferred Stock (as defined in the Plan) and other outstanding convertible securities and exercise of all outstanding warrants to purchase common stock) plus (y) 30,946; and (iii) an amount determined by the Board. ● Provisions that no more than 405,406 shares may be granted to any participant in any fiscal year. ● Provisions to allow for performance based equity awards to be issued by the Company in accordance with Section 162(m) of the Internal Revenue Code. On September 22, 2016, the Board of Directors ratified an automatic increase in the number of shares reserved for issuance under the Plan, increasing the total shares reserved from 1,129,837 to 1,208,307 shares of common stock, under the annual evergreen provision for the Plan, plus a fixed amount of 30,946. On January 1, 2017, the Board of Directors ratified an automatic increase in the number of shares reserved for issuance under the Plan, effective January 1, 2017, increasing the total shares reserved from 1,208,307 to 2,159,352 shares of common stock, under the annual evergreen provision for the Plan , plus a fixed amount of 30,946. On June 12, 2017, the Company’s stockholders at its annual meeting approved a proposal to increase in the number of shares reserved for issuance under the Plan, increasing the total shares reserved under the Plan from 2,128,406 (including the fixed amount of 30,946) to 4,128,406, and increasing the number of shares that may be granted to any participant in any fiscal year to 900,000, from 405,406. On October 2, 2017, in a special meeting of stockholders, the Company received approval of the Fifth Amended and Restated MabVax Therapeutics Holdings, Inc. 2014 Employee, Director and Consultant Equity Incentive Plan (the “Plan”), including an increase in the shares of common stock reserved for issuance under the Plan from 4,128,406 to 6,128,406 shares. Stock-based Compensation We measure stock-based compensation expense for equity-classified awards, principally related to stock options and restricted stock units, or RSUs, based on the estimated fair value of the award on the date of grant. We recognize the value of the portion of the award that we ultimately expect to vest as stock-based compensation expense over the requisite service period in our condensed consolidated statements of operations. Due to limited activity in 2017, 2016 and 2015, we assumed a forfeiture rate of zero. We use the Black-Scholes model to estimate the fair value of stock options granted. The expected term of stock options granted represents the period of time that we expect them to be outstanding. For the three and nine months ended September 30, 2017 and 2016, the following valuation assumptions were used (there were no options granted for the three months ended September 30, 2017): Three Months Ended Nine Months Ended September 30, September 30, 2017 2016 2017 2016 Risk-free inter est rate - 0.87% 1.5 to 2.0% 1.43% Dividend yield - 0% 0% 0% Expected volatility - 70.98% 7. to 85% 85.91% Expected life of options, in years - 2.9 yrs. 1.4 to 6.0 yrs. 6.0 yrs. Weighted-average grant date fair value - $ 3.43 $ 1.53 $ 3.23 Total estimated stock-based compensation expense, related to all of the Company’s stock-based payment awards recognized under ASC 718, “Compensation—Stock Compensation” Three Months Ended Three Months Ended Nine Months Ended Nine Months Ended September 30, September 30, September 30, September 30, 2017 2016 2017 2016 Research and development $ 292,523 $ 301,985 $ 989,884 $ 889,666 General and administrative 721,213 666,556 3,526,488 2,570,326 Total stock-based compensation expense $ 1,013,736 $ 968,541 $ 4,516,372 $ 3,459,992 Stock-based Award Activity The following table summarizes the Company’s stock option activity during the nine months ended September 30, 2017: Options Outstanding Weighted-Average Exercise Price Outstanding at December 31, 2016 851,375 $ 10.94 Granted 2,046,690 2.37 Exercised — — Forfeited/cancelled/expired (82,825 ) 5.67 Outstanding and expected to vest at September 30, 2017 2,815,240 $ 4.87 Vested and exercisable at September 30, 2017 1,742,632 $ 4.79 The total unrecognized compensation cost related to unvested stock option grants as of September 30, 2017, was $2,519,222 and the weighted average period over which these grants are expected to vest is 1.71 years. The weighted average remaining contractual life of stock options outstanding at September 30, 2017 and 2016 is 9.1 and 9.0 years, respectively. During the first nine months of 2017, the Company granted 2,046,690 options to officers and employees with a weighted average exercise price of $2.37 which consisted of 1,300,000 shares vesting immediately at grant and the remainder vesting over a three-year period starting at the one-year anniversary of the grant date. During the first nine months of 2016, the Company granted 413,578 options to officers and employees with a weighted average exercise price of $5.21. Stock options granted to employees generally vest over a three-year period with one third of the grants vesting at each one-year anniversary of the grant date. Because the Company had a net operating loss carryforward as of September 30, 2017, no tax benefits for the tax deductions related to stock-based compensation expense were recognized in the Company’s condensed consolidated statements of operations. Additionally, no stock options were exercised in the three and nine months ended September 30, 2017 and 2016. A summary of activity related to restricted stock grants under the Plan for the nine months ended September 30, 2017 is presented below: Shares Weighted Average Grant-Date Fair Value Non-vested at December 31, 2016 205,478 $ 16.84 Granted 850,965 .55 Vested (102,737 ) 16.22 Forfeited — — Non-vested at September 30, 2017 953,706 $ 2.30 As of September 30, 2017, there were 953,706 non-vested restricted stock units remaining outstanding. As of September 30, 2017 and 2016, unamortized compensation expense related to restricted stock grants amounted to $1,169,284 and $2,553,920, respectively, which is expected to be recognized over a weighted average period of 0.24 and 1.5 years, respectively. Management Bonus Plan and Compensation for Non-Employee Directors On February 16, 2016, our Compensation Committee approved a 2016 Management Bonus Plan (the “2016 Management Plan”) outlining maximum target bonuses of the base salaries of certain of our executive officers. Under the terms of the 2016 Management Plan, the Company's Chief Executive Officer shall receive a maximum target bonus of up to 50% of his annual base salary, and the Chief Financial Officer and each of the Company's Vice Presidents shall receive a maximum target bonus of up to 30% of their annual base salary. Also, on February 16, 2016, the Compensation Committee of the Board of Directors of the Company approved the following amendments to Company's policy for compensating non-employee members of the Board: ● The initial equity grant upon first appointment (or election) of future non-employee directors to the Board shall be a 10-year option to purchase 6,757 shares of the Company's common stock, under the Company's Second Amended and Restated 2014 Equity Incentive Plan with 3-year annual vesting and a strike price equal the closing price of the Company's common stock on the effective date of the appointment (or election); ● The annual cash retainer for each non-employee director, paid quarterly, is increased by $1,000 per calendar quarter to a total of $7,000 per quarter, effective April 1, 2016; and ● The additional annual cash retainer for the chairperson of each of the Audit, Compensation, and Nominating and Governance Committees, paid quarterly, is increased by $1,000 per calendar year, such that each chairperson retainer shall be as follows, effective April 1, 2016: Audit Committee: $13,000; Compensation Committee: $9,000; Nominating and Governance Committee: $6,000. On August 25, 2016, the Compensation Committee of the Board of Directors of the Company approved the following amendments to Company's policy for compensating non-employee members of the Board: ● the initial equity grant upon first appointment (or election) of future non-employee directors to the Board shall be a 10-year option to purchase 25,000 shares of the Company's common stock, under the Plan with 3-year annual vesting and a strike price equal to the closing price of the Company's common stock on the effective date of the appointment (or election); and ● The additional automatic annual option grant to each non-employee director on the date of the Company's annual meeting shall be a 10-year option to purchase 17,500 shares of the Company's common stock, under the Plan with 1-year vesting and a strike price equal to the closing price of the Company's common stock on the date of the annual meeting. On February 6, 2017, the Compensation Committee of the Board of Directors of the Company approved the following amendments to Company's policy for compensating non-employee members of the Board: ● The initial equity grant upon first appointment (or election) of future non-employee directors to the Board shall be a 10-year option to purchase 30,000 shares of the Company's common stock, under the Plan with 3-year annual vesting and a strike price equal to the closing price of the Company's common stock on the effective date of the appointment (or election); and ● The additional automatic annual option grant to each non-employee director on the date of the Company's annual meeting shall be a 10-year option to purchase 20,000 shares of the Company's Common Stock, under the Plan with 1-year vesting and a strike price equal the closing price of the Company's common stock on the date of the annual meeting. On May 19, 2017, in connection with the May 2017 Public Offering, the Company entered into the May 2017 Letter Agreement with the Lead Investor, whereby the Company was obligated to issue an aggregate of 1,050,000 options to certain employees and members of the Board, at a price not less than $2.00 per share, and 50,000 options to each other Board member at the current market price. Further, all Board fees were waived for 2017 in connection with the May 2017 Letter Agreement. On August 14, 2017, the Chairman of the Compensation Committee, acting on behalf of the Board of Directors sent a letter to each executive of the Company stating that the Board deems it in the best interests of the Company to request that the executive voluntarily defer a portion of his regular salary to help with cash flow of the Company. On August 16 and August 21, 2017, Paul Resnick, M.D. and Paul Maffuid, Ph.D., respectively gave notice of good reason (as that term is defined in their employment agreements, or “Good Reason”) for termination of their employment. The Company had 30 days from the notification date under each of their employment agreements to cure their concerns. In oral discussions with each executive the President and Chief Executive Officer communicated on behalf of the Compensation Committee the Company’s intention to provide additional equity compensation in return for salary deferrals, Given the perceived uncertainty about the Company’s plans at the time for addressing the concerns of Dr. Resnick and Dr. Maffuid, and that nothing in writing had been provided as possible equity compensation, they each submitted their notices to the Company of good reason for termination. Further, they each expressed in oral conversations that they wanted to remain employed by the Company. The Company cured each executive’s concerns within the 30-day cure period, by reinstating the deferred salary for Dr. Resnick in one instance, and in granting restricted stock to all executives with vesting over time, as disclosed in the filings of Form 4s following the approvals. Both executives rescinded their notices of good reason for termination on September 7, 2017, and all executives’ employment agreements remain unchanged as the salary deferrals remain to be voluntary. Common stock reserved for future issuance Common stock reserved for future issuance consists of the following at September 30, 2017: Common stock reserved for issuance upon conversion of preferred stock 11,633,387 Common stock reserved for issuance upon exercise of warrants 2,073,416 Common stock options outstanding 2,815,240 Authorized for future grant or issuance under the Stock Plan 181,839 Unvested restricted stock 953,706 Total 17,657,588 |
Net Loss per Share
Net Loss per Share | 9 Months Ended |
Sep. 30, 2017 | |
Notes to Financial Statements | |
Net Loss per Share | The Company calculates basic and diluted net loss per share using the weighted-average number of shares of common stock outstanding during the period. When the Company is in a net loss position, it excludes from the calculation of diluted net loss per share all potentially dilutive stock options, preferred stock and warrants, and the diluted net loss per share is the same as the basic net loss per share for such periods. If the Company was to be in a net income position, the weighted average number of shares used to calculate the diluted net income per share would include the potential dilutive effect of in-the-money securities, as determined using the treasury stock method. The table below presents, the potentially dilutive securities that would have been included in the calculation of diluted net loss per share if they were not antidilutive for the periods presented. As of September 30, 2017 2016 Stock options 2,815,240 815,412 Restricted stock awards 953,706 205,478 Preferred stock 11,633,387 2,975,424 Common stock warrants 2,073,416 5,124,144 Total 17,475,748 9,120,458 |
Contracts and Agreements
Contracts and Agreements | 9 Months Ended |
Sep. 30, 2017 | |
Notes to Financial Statements | |
Contracts and Agreements | Memorial Sloan Kettering Cancer Center, or MSK Since 2008 the Company has engaged in various research agreements and collaborations with MSK including licensed rights to cancer vaccines and the blood samples from patients who have been vaccinated with MSK’s cancer vaccines. Total sponsored research contracts outstanding in 2016 amounting to approximately $800,000 in 2016 were 100% complete as of the year ended December 31, 2016. Such sponsored research agreements provide support for preclinical work on the Company’s product development programs. The work includes preparing radioimmunoconjugates of the Company’s antibodies and performing in vitro in vivo Life Technologies Licensing Agreement On September 24, 2015, the Company entered into a licensing agreement with Life Technologies Corporation, a subsidiary of ThermoFisher Scientific. Under the agreement MabVax agreed to license certain cell lines from Life Technologies Corporation to be used in the production of recombinant proteins for the Company’s clinical trials. The amount of the contract is for $450,000 and was fully expensed during 2015. This agreement was fully paid as of December 31, 2016. For the three and nine months ended September 30, 2017, and 2016, the Company recorded no expenses associated with the agreement. Rockefeller University Collaboration In July 2015, the Company entered into a research collaboration agreement with Rockefeller University's Laboratory of Molecular Genetics and Immunology. The Company provided antibody material to Rockefeller University, which is exploring the mechanism of action of constant region (Fc) variants of the HuMab 5B1 in the role of tumor clearance. The Company may supply additional research materials if requested by the Rockefeller University, which is evaluating ways to optimize the function. For the three and nine months ended September 30, 2017 and 2016, the Company recorded no expenses associated with the agreement. Patheon Biologics LLC Agreement On April 14, 2014, the Company entered into a development and manufacturing services agreement with Patheon (f.k.a. Gallus Biopharmaceuticals) to provide a full range of manufacturing and bioprocessing services, including cell line development, process development, protein production, cell culture, protein purification, bio-analytical chemistry and QC testing. Total amount of the contract is estimated at approximately $3.0 million. For the three and nine months ended September 30, 2017 and 2016, the Company recorded no expenses associated with the agreement. NCI PET Imaging Agent Grant In September 2013, the NCI awarded the Company a SBIR Program Contract to support the Company’s program to develop a Positron Emission Tomography (“PET”) imaging agent for pancreatic cancer using a fragment of the Company’s 5B1 antibody (the “NCI PET Imaging Agent Grant”). The project period for Phase I of the grant award of approximately $250,000 covered a nine-month period, which commenced in September 2013 and ended in June 2014. On August 25, 2014, the Company was awarded a $1.5 million contract for the Phase II portion of the NCI PET Imaging Agent Grant. The contract is intended to support a major portion of the preclinical work being conducted by the Company, together with its collaboration partner, MSK, to develop a novel PET imaging agent for detection and assessment of pancreatic cancer. The total contract amount for Phase I and Phase II was approximately $1,749,000. The Company recorded revenue associated with the NCI PET Imaging Agent Grant as the related costs and expenses were incurred. For the three and nine month periods ended September 30, 2017 the Company recorded no revenues associated with the NCI PET Imaging Agent Grant, and during the same periods in 2016, the Company recorded $0 and $148,054 of revenue associated with the NCI PET Imaging Agent Grant, respectively. |
Commitments and contingencies
Commitments and contingencies | 9 Months Ended |
Sep. 30, 2017 | |
Notes to Financial Statements | |
Commitments and contingencies | Capital Leases On March 21, 2016, the Company entered into a lease agreement with ThermoFisher Scientific (“Lessor”). Under the terms of the agreement, the Company agreed to lease two pieces of equipment from the Lessor, a liquid chromatography system and an incubator, totaling in cost of $95,656. The term of the lease is five years (60 months), and the monthly lease payment is $1,867. In addition, there is a $1.00 buyout option at the end of the lease term. Minimum future annual capital lease obligations are as follows as of September 30, 2017: 2017 (remaining) $ 5,601 2018 22,402 2019 22,402 2020 22,402 2021 7,467 Less interest (12,379 ) Principal 67,895 Less current portion (17,447 ) Noncurrent portion $ 50,448 Operating Leases In connection with the Merger, the Company recorded a $590,504 contingent lease termination fee, in connection with the termination by MabVax (f.k.a. Telik, Inc.) of the master lease and sublease of 3165 Porter Drive in Palo Alto, California, which is payable to ARE-San Francisco No. 24, if the Company receives $15 million or more in additional financing in the aggregate. The additional financing was achieved in 2015 and the termination fee is reflected on the condensed consolidated balance sheet as an accrued lease contingency fee. On September 2, 2015, the Company The Company has an option to extend the Lease term for a single, five-year period. If the Lease term is extended for the optional five-year period, the monthly base rent will be adjusted based on fair market rental value. In addition to rent, the Company agreed to pay a portion of the taxes and utility, maintenance and other operating costs paid or accrued in connection with the ownership and operation of the property. During the three and nine months ended September 30, 2017, the Company recorded rent expense of $115,238 and $345,714, respectively, and during the three and nine months ended September 30, 2016, the Company recorded rent expense of $115,238 and $318,159, respectively. Minimum future annual operating lease obligations are as follows as of September 30, 2017: 2017 (remaining) $ 110,100 2018 451,409 2019 464,951 2020 478,900 2021 493,267 Thereafter 82,612 Total $ 2,081,239 |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events | October 10, 2017 Registered Direct Offering October 16, 2017 Series L Preferred Stock The shares of Series L Preferred Stock are convertible into shares of common stock based on a conversion calculation equal to the stated value of the Series L Preferred Stock, plus all accrued and unpaid dividends, if any, on such Series L Preferred Stock, as of such date of determination, divided by the conversion price. The stated value of each share of Series L Preferred Stock is $100 and the initial conversion price is $0.60 per share, each subject to adjustment for stock splits, stock dividends, recapitalizations, combinations, subdivisions or other similar events. The holders of Series L Preferred Stock will be entitled to receive dividends if and when declared by our board of directors. The Series L Preferred Stock shall participate on an “as converted” basis, with all dividends declared on our common stock. In addition, if the Company grants, issues or sells any rights to purchase its securities pro rata to all record holders of common stock, each holder will be entitled to acquire such securities applicable to the granted purchase rights as if the holder had held the number of shares of common stock acquirable upon complete conversion of all Series L Preferred Stock then held. We are prohibited from effecting a conversion of the Series L Preferred Stock if the Company has not obtained stockholder approval for the full conversion of the Series L Preferred Stock in accordance with the rules of the NASDAQ Capital Market or to the extent that, as a result of such conversion, the holder would beneficially own more than 4.99% of the number of shares of common stock outstanding immediately after giving effect to the issuance of shares of common stock upon conversion of the Series L Preferred Stock, which beneficial ownership limitation may be increased by the holder up to, but not exceeding, 9.99%. Each holder is entitled to vote on all matters submitted to stockholders of the Company, and shall have the number of votes equal to the number of shares of common stock issuable upon conversion of such holder’s Series L Preferred Stock, substituting the consolidated closing bid price of the common stock on October 13, 2017, for the then-applicable conversion price, and not in excess of the beneficial ownership limitations or limitations required by the rules and regulations of the NASDAQ Capital Market. Holders of Series L Preferred Stock will be entitled to a preferential payment of cash per share equal to the greater of 100% of the base amount on the date of payment or the amount per share had the holders converted such preferred shares immediately prior to the date of payment upon the liquidation, dissolution or winding up of the affairs of the Company, or a consolidation or merger of the Company with or into any other corporation or corporations, or a sale of all or substantially all of the assets of the Company, or the effectuation by the Company of a transaction or series of transactions in which more than 50% of the voting shares of the Company is disposed of or conveyed. October 17, 2017 Preferred Stock Exchange Agreement The terms of the Exchange Agreements and Series L Preferred Stock were determined by negotiation between the parties. No commission or other payment was received by the Company in connection with the Exchange Agreements. Such exchange was conducted pursuant to the exemption provided by Section 3(a)(9) of the Securities Act, and Series L Preferred Stock issuable pursuant to the Exchange Agreements and the Conversion Shares will be issued in reliance on the exemption from registration contained in Section 3(a)(9) of the Securities Act. Pursuant to a registration rights agreement entered into between the Company and the Holders on October 17, 2017, the Company agreed to use its reasonable best efforts to file a registration statement registering the Conversion Shares for resale within 10 days of closing and cause the registration statement to be declared effective within 30 days of filing. On October 25, 2017, we filed a registration statement with the SEC, which was within 10 days of closing. The registration statement is currently under review by the SEC. Restricted Stock Grants |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 9 Months Ended |
Sep. 30, 2017 | |
Basis Of Presentation Policies | |
Recent Accounting Pronouncements | In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606) which contains new accounting literature relating to how and when a company recognizes revenue. Under ASU 2014-09, a company will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods and services. ASU 2014-09 is effective for the Company’s fiscal year beginning January 1, 2018, which reflects a one year deferral approved by the FASB in July 2015, and will be adopted by the Company beginning January 1, 2018. In February 2016, the FASB issued ASU 2016-2, “Leases (Topic 842).” This update will increase transparency and comparability by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. Under the new guidance, lessees will be required to recognize the following for all leases (with the exception of short-term leases) at the commencement date (i) a lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis; and (ii) a right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. Under the new guidance, lessor accounting is largely unchanged, and it simplified the accounting for sale and leaseback transactions. Lessees will no longer be provided with a source of off-balance sheet financing. Lessees (for capital and operating leases) and lessors (for sales-type, direct financing, and operating leases) must apply a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The modified retrospective approach would not require any transition accounting for leases that expired before the earliest comparative period presented. Lessees and lessors may not apply a full retrospective transition approach. The standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. We are currently in the process of assessing what impact this new standard may have on our condensed consolidated financial statements. In March 2016, the FASB issued ASU 2016-09, “Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting.” This update includes multiple provisions intended to simplify various aspects of the accounting for share-based payment transactions including accounting for excess tax benefits and tax deficiencies, classification of excess tax benefits in the statement of cash flows and accounting for award forfeitures. This update is effective for annual and interim reporting periods of public entities beginning after December 15, 2016, with early adoption permitted. The adoption of this new standard did not have a material impact on our condensed consolidated financial statements. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments—Credit Losses (Topic326): Measurement of Credit Losses on Financial Instruments. This ASU requires instruments measured at amortized cost to be presented at the net amount expected to be collected. Entities are also required to record allowances for available-for-sale debt securities rather than reduce the carrying amount. This ASU is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. In August 2016, the FASB issued ASU No. 2016-15 (“ASU 2016-15”), “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments.” The standard provides guidance on eight (8) cash flow issues: (1) debt prepayment or debt extinguishment costs; (2) settlement of zero-coupon bonds; (3) contingent consideration payments after a business combination; (4) proceeds from the settlement of insurance claims; (5) proceeds from the settlement of corporate-owned life insurance policies; (6) distributions received from equity method investees; (7) beneficial interests in securitization transactions; and (8) separately identifiable cash flows and application of the predominance principle. ASU 2016-15 addresses how certain cash receipts and cash payments are presented and classified in the statement of cash flows. ASU 2016-15 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2017 with early adoption permitted. We expect the adoption of this new standard will not have a material impact on our condensed consolidated financial statements. In August 2016, the FASB issued ASU No. 2016-16, “Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory . In January 2017, the FASB issued ASU No. 2017-03, “Accounting Changes and Error Corrections (Topic 250) and Investments—Equity Method and Joint Ventures (Topic 323).” This ASU amends the disclosure requirements for ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), ASU No. 2016-02, Leases (Topic 842) and ASU No. 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. This ASU states that if a registrant does not know or cannot reasonably estimate the impact that the adoption of the above ASUs is expected to have on the financial statements, then in addition to making a statement to that effect, the registrant should consider additional qualitative financial statement disclosures to assist the reader in assessing the significance of the impact that the standard will have on the financial statements of the registrant when adopted. This ASU was effective upon issuance. In January 2017, the FASB issued ASU No. 2017-04, “Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment.” This ASU eliminates Step 2 from the goodwill impairment test. Instead, an entity should recognize an impairment charge for the amount by which the carrying value exceeds the reporting unit’s fair value, not to exceed the total amount of goodwill allocated to that reporting unit. This ASU is effective for annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019. In January 2017, the FASB issued ASU No. 2017-01, “Business Combinations (Topic 805): Clarifying the Definition of a Business.” This ASU clarifies the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. This ASU is effective for annual periods beginning after December 15, 2017, including interim periods within those periods. Management believes that any other recently issued, but not yet effective, accounting standards if currently adopted would not have a material effect on the accompanying condensed consolidated financial statements. |
Notes Payable (Tables)
Notes Payable (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Notes Payable | |
Future principal payments | Years ending December 31: 2017 (remaining) – [ be sure to include both Insurance Notes here $ 581,952 2018 1,666,667 2019 1,666,667 2020 138,889 Notes payable, balance as of September 30, 2017 4,054,175 Unamortized discount on notes payable (403,453 ) Notes payable, balance as of September 30, 2017 3,650,722 Current portion of notes payable (1,693,065 ) Non-current portion of notes payable $ 1,957,657 |
Stock-based Activity (Tables)
Stock-based Activity (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Stock-based Activity Tables | |
Valuation Assumptions | Three Months Ended Nine Months Ended September 30, September 30, 2017 2016 2017 2016 Risk-free inter est rate - 0.87% 1.5 to 2.0% 1.43% Dividend yield - 0% 0% 0% Expected volatility - 70.98% 7. to 85% 85.91% Expected life of options, in years - 2.9 yrs. 1.4 to 6.0 yrs. 6.0 yrs. Weighted-average grant date fair value - $ 3.43 $ 1.53 $ 3.23 |
Stock-based Compensation | Three Months Ended Three Months Ended Nine Months Ended Nine Months Ended September 30, September 30, September 30, September 30, 2017 2016 2017 2016 Research and development $ 292,523 $ 301,985 $ 989,884 $ 889,666 General and administrative 721,213 666,556 3,526,488 2,570,326 Total stock-based compensation expense $ 1,013,736 $ 968,541 $ 4,516,372 $ 3,459,992 |
Stock-based Award Activity | Options Outstanding Weighted-Average Exercise Price Outstanding at December 31, 2016 851,375 $ 10.94 Granted 2,046,690 2.37 Exercised — — Forfeited/cancelled/expired (82,825 ) 5.67 Outstanding and expected to vest at September 30, 2017 2,815,240 $ 4.87 Vested and exercisable at September 30, 2017 1,742,632 $ 4.79 |
Restricted stock grants | Shares Weighted Average Grant-Date Fair Value Non-vested at December 31, 2016 205,478 $ 16.84 Granted 850,965 .55 Vested (102,737 ) 16.22 Forfeited — — Non-vested at September 30, 2017 953,706 $ 2.30 |
Common stock reserved for future issuance | Common stock reserved for issuance upon conversion of preferred stock 11,633,387 Common stock reserved for issuance upon exercise of warrants 2,073,416 Common stock options outstanding 2,815,240 Authorized for future grant or issuance under the Stock Plan 181,839 Unvested restricted stock 953,706 Total 17,657,588 |
Net Loss per Share (Tables)
Net Loss per Share (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Net Loss Per Share Tables | |
Potentially dilutive securities | As of September 30, 2017 2016 Stock options 2,815,240 815,412 Restricted stock awards 953,706 205,478 Preferred stock 11,633,387 2,975,424 Common stock warrants 2,073,416 5,124,144 Total 17,475,748 9,120,458 |
Commitments and contingencies (
Commitments and contingencies (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Notes to Financial Statements | |
Minimum future annual operating lease obligations | 2017 (remaining) $ 5,601 2018 22,402 2019 22,402 2020 22,402 2021 7,467 Less interest (12,379 ) Principal 67,895 Less current portion (17,447 ) Noncurrent portion $ 50,448 |
Future minimum lease payments | 2017 (remaining) $ 110,100 2018 451,409 2019 464,951 2020 478,900 2021 493,267 Thereafter 82,612 Total $ 2,081,239 |
Basis of Presentation (Details
Basis of Presentation (Details Narrative) | 9 Months Ended |
Sep. 30, 2017 | |
Notes to Financial Statements | |
State of incorporation | Delaware |
Date of incorporation | Oct. 20, 1988 |
Trading symbol | MBVX |
Liquidity and Going Concern (De
Liquidity and Going Concern (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||||
Net (loss) | $ (3,080,161) | $ (4,357,748) | $ (14,424,883) | $ (12,550,493) | ||
Net cash used for operating activities | 8,702,932 | 9,622,309 | ||||
Net cash used in investing activities | 21,072 | 412,498 | ||||
Net cash provided by financing activities | 7,797,492 | 12,891,935 | ||||
Cash and cash equivalents | 3,052,778 | $ 6,941,213 | 3,052,778 | $ 6,941,213 | $ 3,979,290 | $ 4,084,085 |
Accumulated deficit | 101,046,557 | 101,046,557 | 78,262,261 | |||
Stockholders' equity | $ 2,520,416 | $ 2,520,416 | $ 3,342,522 |
Convertible Preferred Stock, 26
Convertible Preferred Stock, Common Stock and Warrants (Details Narrative) - shares | Sep. 30, 2017 | Dec. 31, 2016 |
Series D Convertible Preferred Stock [Member] | ||
Preferred stock, shares issued | 44,104 | 132,489 |
Preferred stock, shares outstanding | 44,104 | 132,489 |
Series E Convertible Preferred Stock [Member] | ||
Preferred stock, shares issued | 33,333 | 33,333 |
Preferred stock, shares outstanding | 33,333 | 33,333 |
Series F Convertible Preferred Stock [Member] | ||
Preferred stock, shares issued | 665,281 | 665,281 |
Preferred stock, shares outstanding | 665,281 | 665,281 |
Series G Convertible Preferred Stock [Member] | ||
Preferred stock, shares issued | 1,000,000 | 0 |
Preferred stock, shares outstanding | 1,000,000 | 0 |
Series H Convertible Preferred Stock [Member] | ||
Preferred stock, shares issued | 850 | 0 |
Preferred stock, shares outstanding | 850 | 0 |
Series I Convertible Preferred Stock [Member] | ||
Preferred stock, shares issued | 1,048,460 | 0 |
Preferred stock, shares outstanding | 1,048,460 | 0 |
Series J Convertible Preferred Stock [Member] | ||
Preferred stock, shares issued | 818.18 | 0 |
Preferred stock, shares outstanding | 818.18 | 0 |
Series K Convertible Preferred Stock [Member] | ||
Preferred stock, shares issued | 65,000 | 0 |
Preferred stock, shares outstanding | 65,000 | 0 |
Notes Payable (Details)
Notes Payable (Details) - USD ($) | Sep. 30, 2017 | Dec. 31, 2016 |
Years ending December 31: | ||
2,017 | $ 581,952 | |
2,018 | 1,666,667 | |
2,019 | 1,666,667 | |
2,020 | 138,889 | |
Notes Payable, balance as of September 30, 2017 | 4,054,175 | |
Unamortized discount on notes payable | (403,453) | |
Notes Payable, balance as of September 30, 2017 | 3,650,722 | |
Current portion of notes payable | (1,693,065) | $ (1,589,661) |
Non-current portion of notes payable | $ 1,957,657 | $ 2,774,627 |
Notes Payable (Details Narrativ
Notes Payable (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Notes Payable | ||||
Interest expense | $ 138,642 | $ 266,057 | $ 445,934 | $ 729,350 |
Stock-based Activity (Details)
Stock-based Activity (Details) - $ / shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Risk-free interest rate | 0.00% | 0.87% | 1.43% | |
Dividend yield | 0.00% | 0.00% | 0.00% | 0.00% |
Expected volatility | 0.00% | 70.98% | 85.91% | |
Expected life of options, in years | 0 years | 2 years 10 months 24 days | 6 years | |
Weighted average grant date fair value | $ 0 | $ 3.43 | $ 1.53 | $ 3.23 |
Minimum [Member] | ||||
Risk-free interest rate | 1.50% | |||
Expected volatility | 73.00% | |||
Expected life of options, in years | 1 year 4 months 24 days | |||
Maximum [Member] | ||||
Risk-free interest rate | 2.00% | |||
Expected volatility | 85.00% | |||
Expected life of options, in years | 6 years |
Stock-based Activity (Details 1
Stock-based Activity (Details 1) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Total stock-based compensation expense | $ 1,013,736 | $ 968,541 | $ 4,516,372 | $ 3,459,992 |
Research and Development Expense [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Total stock-based compensation expense | 292,523 | 301,985 | 989,884 | 889,666 |
General and Administrative Expense [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Total stock-based compensation expense | $ 721,213 | $ 666,556 | $ 3,526,488 | $ 2,570,326 |
Stock-based Activity (Details 2
Stock-based Activity (Details 2) | 9 Months Ended |
Sep. 30, 2017$ / sharesshares | |
Options Outstanding | |
Options Outstanding, Outstanding at beginning of period | shares | 851,375 |
Options Granted | shares | 2,046,690 |
Options Exercised | shares | 0 |
Options Forfeited/cancelled/expired | shares | (82,825) |
Options Outstanding and expected to vest at end of period | shares | 2,815,240 |
Vested and exercisable at September 30, 2017 | shares | 1,742,632 |
Weighted-Average Exercise Price | |
Weighted-Average Exercise Price, Outstanding at beginning of period | $ / shares | $ 10.94 |
Weighted-Average Exercise Price, Granted | $ / shares | 2.37 |
Weighted-Average Exercise Price, Exercised | $ / shares | 0 |
Weighted-Average Exercise Price, Forfeited/cancelled/expired | $ / shares | 5.67 |
Weighted-Average Exercise Price, Outstanding and expected to vest at end of period | $ / shares | 4.87 |
Weighted-Average Exercise Price, Vested and exercisable at September 30, 2017 | $ / shares | $ 4.79 |
Stock-based Activity (Details 3
Stock-based Activity (Details 3) | 9 Months Ended |
Sep. 30, 2017$ / sharesshares | |
Shares | |
Nonvested at beginning of period | shares | 205,478 |
Granted | shares | 850,965 |
Vested | shares | (102,737) |
Forfeited | shares | 0 |
Nonvested at end of period | shares | 953,706 |
Weighted Average Grant-Date Fair Value | |
Nonvested at beginning of period | $ / shares | $ 16.84 |
Granted | $ / shares | .55 |
Vested | $ / shares | 16.22 |
Forfeited | $ / shares | 0 |
Nonvested at end of period | $ / shares | $ 2.30 |
Stock-based Activity (Details 4
Stock-based Activity (Details 4) | Sep. 30, 2017shares |
Common stock reserved for future issuance | 17,657,588 |
Equity Option [Member] | |
Common stock reserved for future issuance | 2,815,240 |
Common stock reserved for conversion of preferred stock [Member] | |
Common stock reserved for future issuance | 11,633,387 |
Exercise of Warrants [Member] | |
Common stock reserved for future issuance | 2,073,416 |
Stock Plan [Member] | |
Common stock reserved for future issuance | 181,839 |
Restricted Stock [Member] | |
Common stock reserved for future issuance | 953,706 |
Stock-based Activity (Details N
Stock-based Activity (Details Narrative) - USD ($) | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||
Unrecognized stock-based compensation expense, options | $ 2,519,222 | |
Unrecognized stock-based compensation expense, recognition period | 1 year 7 months 10 days | |
Weighted average remaining Contractual term, stock options outstanding | 9 years 1 month 6 days | 9 years |
Options Granted | 2,046,690 | |
Weighted average exercise price | $ 2.37 |
Net Loss per Share (Details)
Net Loss per Share (Details) - shares | 3 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Shares excluded from diluted net loss per common share calculations | 17,475,748 | 9,120,458 |
Stock Option [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Shares excluded from diluted net loss per common share calculations | 2,815,240 | 815,412 |
Restricted Stock [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Shares excluded from diluted net loss per common share calculations | 953,706 | 205,478 |
Preferred Stock [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Shares excluded from diluted net loss per common share calculations | 11,633,387 | 2,975,424 |
Warrants to purchase common stock [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Shares excluded from diluted net loss per common share calculations | 2,073,416 | 5,124,144 |
Contracts and Agreements (Detai
Contracts and Agreements (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Notes to Financial Statements | ||||
Revenues | $ 0 | $ 0 | $ 0 | $ 148,054 |
Commitments and contingencies37
Commitments and contingencies (Details) - USD ($) | Sep. 30, 2017 | Dec. 31, 2016 |
Notes to Financial Statements | ||
2017 (remainder of) | $ 5,601 | |
2,018 | 22,402 | |
2,019 | 22,402 | |
2,020 | 22,402 | |
2,021 | 7,467 | |
Less interest | (12,379) | |
Principal | 67,895 | |
Less current portion | (17,447) | $ (17,004) |
Noncurrent portion | $ 50,448 | $ 68,113 |
Commitments and contingencies38
Commitments and contingencies (Details 1) | Sep. 30, 2017USD ($) |
Notes to Financial Statements | |
2017 (remaining) | $ 110,100 |
2,018 | 451,409 |
2,019 | 464,951 |
2,020 | 478,900 |
2,021 | 493,267 |
Thereafter | 82,612 |
Total | $ 2,081,239 |
Commitments and contingencies39
Commitments and contingencies (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Notes to Financial Statements | ||||
Rent expense | $ 115,238 | $ 115,238 | $ 345,714 | $ 318,159 |