Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2018 | Nov. 02, 2018 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | HTGM | |
Entity Registrant Name | HTG Molecular Diagnostics, Inc | |
Entity Central Index Key | 1,169,987 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | true | |
Entity Common Stock, Shares Outstanding | 28,495,750 |
Condensed Balance Sheets
Condensed Balance Sheets - USD ($) | Sep. 30, 2018 | Dec. 31, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 6,164,005 | $ 9,968,600 |
Short-term investments available-for-sale, at fair value | 27,613,031 | |
Accounts receivable | 3,361,333 | 6,356,268 |
Inventory, net of allowance of $39,403 at September 30, 2018 and $62,142 at December 31, 2017 | 1,129,092 | 1,180,521 |
Prepaid expenses and other | 688,556 | 443,068 |
Total current assets | 38,956,017 | 17,948,457 |
Restricted cash - non-current | 3,270,247 | |
Deferred offering costs | 2,953 | |
Deferred MidCap revolving loan costs | 71,126 | |
Property and equipment, net | 2,614,620 | 3,304,890 |
Total assets | 44,912,010 | 21,256,300 |
Current liabilities: | ||
Accounts payable | 1,867,181 | 2,438,798 |
Accrued liabilities | 2,530,615 | 3,746,786 |
Contract liabilities - current | 273,763 | 665,882 |
NuvoGen obligation - current | 593,860 | 496,442 |
Growth Term Loan payable - net of discount and debt issuance costs | 5,793,599 | |
Other current liabilities | 199,621 | 200,460 |
Total current liabilities | 5,465,040 | 13,341,967 |
NuvoGen obligation - non-current, net of discount | 6,684,631 | 7,520,913 |
Convertible note, related party - net of debt issuance costs | 2,970,850 | 2,960,760 |
MidCap Term Loan payable - net of discount and debt issuance costs | 6,666,796 | |
Other non-current liabilities | 333,367 | 492,197 |
Total liabilities | 22,120,684 | 24,315,837 |
Commitments and Contingencies (Note 14) | ||
Stockholders’ equity (deficit): | ||
Common stock, $0.001 par value; 200,000,000 shares authorized at September 30, 2018 and December 31, 2017, 28,479,341 shares issued and outstanding at September 30, 2018 and 13,929,763 shares issued and outstanding at December 31, 2017 | 28,479 | 13,929 |
Additional paid-in-capital | 171,663,874 | 131,492,595 |
Accumulated other comprehensive loss | (8,882) | |
Accumulated deficit | (148,892,145) | (134,566,061) |
Total stockholders’ equity (deficit) | 22,791,326 | (3,059,537) |
Total liabilities and stockholders' equity (deficit) | $ 44,912,010 | $ 21,256,300 |
Condensed Balance Sheets (Paren
Condensed Balance Sheets (Parenthetical) - USD ($) | Sep. 30, 2018 | Dec. 31, 2017 |
Statement Of Financial Position [Abstract] | ||
Inventory net allowance | $ 39,403 | $ 62,142 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 200,000,000 | 200,000,000 |
Common stock, shares issued | 28,479,341 | 13,929,763 |
Common stock, shares outstanding | 28,479,341 | 13,929,763 |
Condensed Statements of Operati
Condensed Statements of Operations - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Revenue: | ||||
Total revenue | $ 4,706,378 | $ 3,723,484 | $ 13,775,796 | $ 6,855,409 |
Cost of revenue | 1,239,702 | 1,088,987 | 3,827,447 | 3,621,193 |
Gross margin | 3,466,676 | 2,634,497 | 9,948,349 | 3,234,216 |
Operating expenses: | ||||
Selling, general and administrative | 4,709,885 | 4,258,347 | 15,132,468 | 12,910,251 |
Research and development | 3,561,459 | 3,478,419 | 8,909,729 | 6,364,371 |
Total operating expenses | 8,271,344 | 7,736,766 | 24,042,197 | 19,274,622 |
Operating loss | (4,804,668) | (5,102,269) | (14,093,848) | (16,040,406) |
Other income (expense): | ||||
Interest expense | (234,392) | (300,272) | (650,215) | (1,048,750) |
Interest income | 195,652 | 22,438 | 526,588 | 52,157 |
Loss on extinguishment of Growth Term Loan | (105,064) | |||
Total other income (expense) | (38,740) | (277,834) | (228,691) | (996,593) |
Net loss before income taxes | (4,843,408) | (5,380,103) | (14,322,539) | (17,036,999) |
Provision for income taxes | 743 | 3,545 | 1,023 | |
Net loss | $ (4,843,408) | $ (5,380,846) | $ (14,326,084) | $ (17,038,022) |
Net loss per share, basic and diluted | $ (0.17) | $ (0.46) | $ (0.53) | $ (1.74) |
Shares used in computing net loss per share, basic and diluted | 28,434,406 | 11,603,617 | 27,184,968 | 9,794,651 |
Product and Product-related Services | ||||
Revenue: | ||||
Total revenue | $ 1,314,844 | $ 1,592,790 | $ 5,071,702 | $ 4,422,304 |
Collaborative Development Services | ||||
Revenue: | ||||
Total revenue | $ 3,391,534 | $ 2,130,694 | $ 8,704,094 | $ 2,433,105 |
Condensed Statements of Compreh
Condensed Statements of Comprehensive Loss - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Statement Of Income And Comprehensive Income [Abstract] | ||||
Net loss | $ (4,843,408) | $ (5,380,846) | $ (14,326,084) | $ (17,038,022) |
Other comprehensive income (loss), net of tax effect: | ||||
Unrealized gain (loss) on short-term investments | 2,457 | 0 | (8,882) | 1,090 |
Comprehensive loss | $ (4,840,951) | $ (5,380,846) | $ (14,334,966) | $ (17,036,932) |
Condensed Statements of Changes
Condensed Statements of Changes in Stockholders' Equity (Deficit) - 9 months ended Sep. 30, 2018 - USD ($) | Total | ATM Offering | Underwritten Public Offering | Common Stock | Common StockATM Offering | Common StockUnderwritten Public Offering | Additional Paid-In Capital | Additional Paid-In CapitalATM Offering | Additional Paid-In CapitalUnderwritten Public Offering | Accumulated Other Comprehensive Loss | Accumulated Deficit |
Balance at Dec. 31, 2017 | $ (3,059,537) | $ 13,929 | $ 131,492,595 | $ (134,566,061) | |||||||
Balance, shares at Dec. 31, 2017 | 13,929,763 | ||||||||||
Exercise of stock options | 204,173 | $ 96 | 204,077 | ||||||||
Exercise of stock options, shares | 96,164 | ||||||||||
Stock-based compensation expense | 1,643,083 | 1,643,083 | |||||||||
Release of restricted stock awards | 270 | $ 270 | |||||||||
Release of restricted stock awards, shares | 269,551 | ||||||||||
Net share settlement of restricted stock awards | (133,513) | $ (35) | (133,478) | ||||||||
Net share settlement of restricted stock awards, shares | (34,769) | ||||||||||
Stock issued under stock purchase plans | 116,794 | $ 42 | 116,752 | ||||||||
Stock issued under stock purchase plans, shares | 42,280 | ||||||||||
Issuance of common stock | $ 556,706 | $ 37,724,316 | $ 262 | $ 13,915 | $ 556,444 | $ 37,710,401 | |||||
Issuance of common stock, shares | 261,352 | 13,915,000 | |||||||||
MidCap Term Loan warrant discount | 74,000 | 74,000 | |||||||||
Net loss | (14,326,084) | (14,326,084) | |||||||||
Other comprehensive loss | (8,882) | $ (8,882) | |||||||||
Balance at Sep. 30, 2018 | $ 22,791,326 | $ 28,479 | $ 171,663,874 | $ (8,882) | $ (148,892,145) | ||||||
Balance, shares at Sep. 30, 2018 | 28,479,341 |
Condensed Statements of Chang_2
Condensed Statements of Changes in Stockholders' Equity (Deficit) (Parenthetical) | 9 Months Ended |
Sep. 30, 2018USD ($) | |
Statement Of Stockholders Equity [Abstract] | |
Public offering issuance costs | $ 2,600,000 |
At the market offering, issuance costs | $ 17,000 |
Condensed Statements of Cash Fl
Condensed Statements of Cash Flows - USD ($) | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Operating activities | ||
Net loss | $ (14,326,084) | $ (17,038,022) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 1,126,230 | 893,334 |
Accretion of discount on NuvoGen obligation | (9,125) | 147,753 |
Provision for excess inventory | 63,840 | 302,085 |
Amortization of Growth Term Loan discount and issuance costs | 62,951 | 325,517 |
Loss on extinguishment of Growth Term Loan | 105,064 | |
Amortization of QNAH Convertible Note issuance costs | 10,090 | |
Amortization of MidCap Credit Facility discount and issuance costs | 92,060 | |
Stock-based compensation expense | 1,643,353 | 1,171,988 |
Employee stock purchase plan expense | 43,932 | 44,170 |
Accretion of incentive from landlord | (106,500) | (106,500) |
Accrued interest on available-for-sale securities investments | (292,308) | 5,991 |
Other operating adjustments | 1,307 | |
Changes in operating assets and liabilities: | ||
Accounts receivable | 2,994,935 | (1,781,782) |
Inventory | 24,986 | 13,944 |
Prepaid expenses and other | (245,488) | (94,295) |
Deferred offering costs | 2,953 | 49,630 |
Accounts payable | (123,266) | 1,521,391 |
Accrued liabilities | (1,216,171) | 327,284 |
Contract liabilities | (449,911) | 469,276 |
Net cash used in operating activities | (10,598,459) | (13,746,929) |
Investing activities | ||
Purchase of property and equipment | (857,899) | (525,437) |
Sales, redemptions and maturities of available-for-sale securities | 15,800,000 | 4,300,000 |
Purchase of available-for-sale securities | (43,129,605) | |
Net cash (used in) provided by investing activities | (28,187,504) | 3,774,563 |
Financing activities | ||
Proceeds from MidCap Credit Facility | 7,000,000 | |
MidCap Credit Facility lender fees | (422,390) | |
Payments on Growth Term Loan | (1,684,626) | (4,740,774) |
Payments for extinguishment of Growth Term Loan | (4,276,988) | |
Proceeds from public offering, net | 37,932,290 | |
Public offering costs | (207,974) | (231,475) |
Proceeds from ATM Offering, net | 556,706 | 16,891,193 |
Payments on NuvoGen obligation | (729,739) | (600,000) |
Payments on capital leases | (59,186) | (43,813) |
Proceeds from exercise of stock options | 204,173 | 165,261 |
Taxes paid for net share settlement of restricted stock awards | (133,513) | |
Proceeds from shares purchased under stock purchase plans | 72,862 | 71,716 |
Net cash provided by financing activities | 38,251,615 | 11,512,108 |
(Decrease) increase in cash, cash equivalents and restricted cash | (534,348) | 1,539,742 |
Cash and cash equivalents at beginning of period | 9,968,600 | 7,507,659 |
Cash, cash equivalents and restricted cash at end of period | 9,434,252 | 9,047,401 |
Supplemental disclosure of noncash investing and financing activities | ||
Fixed asset purchases payable and accrued at period end | 29,615 | 410,184 |
Carrying value of demonstration units transferred from property and equipment to inventory | 49,245 | 55,739 |
Equipment purchased through capital lease | 63,809 | |
MidCap Term Loan fees and warrant discount | 389,000 | |
Retirement of treasury stock | 75,000 | |
Supplemental cash flow information | ||
Cash paid for interest | 369,360 | 575,480 |
Cash paid for taxes | $ 3,545 | $ 1,023 |
Description of Business
Description of Business | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
Description of Business | Note 1. Description of Business HTG Molecular Diagnostics, Inc. (the “Company”) is a provider of instruments, reagents and services for molecular profiling applications. The Company derives revenue from sales of its HTG EdgeSeq automation system and integrated next-generation sequencing-based HTG EdgeSeq assays, from research services including sample processing and custom research use only (“RUO”) assay design and from collaborative development services. The Company operates in one segment and its customers are located primarily in the United States and Europe. For the three and nine months ended September 30, 2018 approximately 79% and 77% of the Company’s revenue was generated from sales originated by customers located outside of the United States, compared with 68% and 49% for the three and nine months ended September 30, 2017. The increase in sales originated by customers located outside of the United States is primarily the result of collaborative development services revenue generated from the Master Assay Development, Commercialization and Manufacturing Agreement (the “Governing Agreement”) with QIAGEN Manchester Limited (“QML”), a wholly owned subsidiary of QIAGEN N.V. (see Note 16), which accounted for 92% and 82% of sales to customers located outside of the United States for the three and nine months ended September 30, 2018, compared to 85% and 72% for the three and nine months ended September 30, 2017. |
Basis of Presentation and Summa
Basis of Presentation and Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Summary of Significant Accounting Policies | Note 2. Basis of Presentation and Summary of Significant Accounting Policies Basis of Presentation The accompanying interim unaudited condensed financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) and reflect the accounts of the Company as of September 30, 2018 and for the three and nine months ended September 30, 2018 and 2017. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles in the United States of America (“GAAP”) for complete financial statements. The accompanying interim unaudited condensed financial statements reflect all adjustments consisting of normal recurring adjustments which, in the opinion of management, are necessary for a fair statement of the Company’s financial position and the results of its operations and cash flows, as of and for the periods presented. The accompanying interim unaudited condensed balance sheet at December 31, 2017 has been derived from the audited financial statements at that date but does not include all of the information and disclosures required by GAAP for annual financial statements. The results of operations for the interim periods are not necessarily indicative of the results to be expected for the full year. These interim unaudited condensed financial statements should be read in conjunction with the Company’s audited financial statements and notes thereto for the fiscal year ended December 31, 2017, included in the Company’s Annual Report on Form 10-K filed with the SEC on March 23, 2018. Reclassifications Certain prior year amounts have been reclassified for consistency with the current period presentation. These reclassifications had no effect on the reported results of operations. Revenue Recognition The Company adopted the Financial Accounting Standards Board (“FASB”) new revenue standard, Accounting Standards Codification 606, Revenue from Contracts with Customers For contracts where the period between when the Company transfers a promised good or service to the customer and when the customer pays is one year or less, the Company has elected the practical expedient to not adjust the promised amount of consideration for the effects of a significant financing component. The Company has made a policy election to exclude from the measurement of the transaction price all taxes assessed by a government authority that are both imposed on and concurrent with a specific revenue producing transaction and collected by the Company from a customer. Such taxes may include but are not limited to sales, use, value added and certain excise taxes. Restricted Cash The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the accompanying interim unaudited condensed balance sheets that sum to the total of the same such amounts shown in the accompanying interim unaudited condensed statements of cash flows. September 30, 2018 Cash and cash equivalents $ 6,164,005 Restricted cash - non-current 3,270,247 Total cash, cash equivalents and restricted cash shown in the interim unaudited condensed statements of cash flows $ 9,434,252 Amounts included in restricted cash represent those required to be set aside in escrow under the terms of the MidCap Term Loan (see Note 8) to collateralize the payment that will be due upon maturity of the QNAH Convertible Note (see Note 16). The amounts will be released to the Company upon subsequent delivery of subordination documents for the QNAH Convertible Note to MidCap or conversion of the QNAH Convertible Note. If neither occurs, the amounts will be applied by the escrow agent to repay in full the QNAH Convertible Note at maturity (or in connection with a prepayment at the direction of the Company) subject to the terms of the MidCap Term Loan. Contract Assets Contract assets represent the Company’s right to consideration in exchange for goods or services that the Company has transferred to a customer, for which rights to payment are conditional upon something other than the passage of time. Contract Liabilities Contract liabilities represent cash receipts for products or services to be delivered in future periods, including up-front fees received relating to custom RUO assay design and sample processing services and collaboration development services. When products or services outputs are delivered to customers, contract liabilities are recognized as earned. Up-front fees received for custom RUO assay design or collaborative development services are recognized over time based on the costs incurred to date compared to total expected costs as design or development procedures are completed and outputs are produced. Product Warranty The Company generally provides a one-year warranty on its HTG EdgeSeq systems covering the performance of system hardware and software in conformance with customer specifications under normal use and protecting against defects in materials and workmanship. The Company may, at its option, replace, repair or exchange products covered under valid warranty claims. This assurance-type warranty is not deemed to be a separate performance obligation under the Company’s contracts with customers for the sale of instruments, as its purpose is to ensure that the product complies with agreed-upon specifications following installation of the instrument. A provision for estimated warranty costs is recognized at the time of sale, through cost of revenue, based upon recent historical experience and other relevant information as it becomes available. The Company continuously assesses the adequacy of its product warranty accrual by reviewing actual claims and adjusts the provision as needed. Research and Development Expenses Research and development expenses represent costs incurred internally for research and development activities and costs incurred externally to fund research activities. The costs include those generated through research and development efforts for the improvement and expansion of the Company’s proprietary technology and product offerings as well as those related to third-party collaborative development agreements, for which related revenue is included in collaborative development services revenue in the accompanying interim unaudited condensed statements of operations. See Note 16 for further discussion of the development costs associated with collaborative development services agreements included in research and development expense as compared to cost of revenue in the accompanying interim unaudited condensed statements of operations. Debt Issuance Costs Costs incurred to issue non-revolving debt instruments are recognized as a reduction to the related debt balance in the accompanying interim unaudited condensed balance sheets and amortized to interest expense over the contractual term of the related debt using the effective interest method. Costs incurred to issue revolving debt instruments are deferred as an asset in the accompanying interim unaudited condensed balance sheets and amortized on a straight-line basis to interest expense over the term of the revolving commitment. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. The Company’s significant estimates include revenue recognition, stock-based compensation expense, bonus accrual, income tax valuation allowances, recovery of long-lived assets, warranty accrual, inventory obsolescence and inventory valuation. Actual results could materially differ from those estimates. Fair Value of Financial Instruments The carrying value of financial instruments classified as current assets and current liabilities approximate fair value due to their liquidity and short-term nature. Investments that are classified as available-for-sale are recorded at fair value, which was determined using quoted market prices, broker or dealer quotations or alternative pricing sources with reasonable levels of price transparency. In October 2017, the Company received $3.0 million in gross proceeds from, and issued a subordinated convertible promissory note (the “QNAH Convertible Note”) in that principal amount to, QIAGEN North American Holdings, Inc. (“QNAH”). As of September 30, 2018, the estimated aggregate fair value of the QNAH Convertible Note is approximately $4.1 million. The fair value estimate is based on the note’s discounted cash flows and estimated option value of the conversion terms. The estimated fair value of the QNAH Convertible Note represents a Level 3 measurement. The fair value of the MidCap Term Loan (see Note 8) is also estimated using Level 3 inputs and approximates fair value as the interest rate approximates the market rate for debt securities with similar terms and risk characteristics. The NuvoGen obligation is an obligation relating to an asset purchase transaction with a then-common stockholder of the Company. Although the obligation is considered a financial instrument, the Company is unable to reasonably determine its fair value as the remaining payments due under the obligation will be made at the greater of a minimum fixed quarterly payment or 6% of revenue, causing variability in the timing and amount of payments and the term of the obligation. Concentration Risks Financial instruments that potentially subject the Company to credit risk consist principally of cash and cash equivalents, available-for-sale debt securities and uncollateralized accounts receivable. The Company maintains the majority of its cash balances in the form of cash deposits in bank checking and money market accounts in amounts in excess of federally insured limits. Management believes, based upon the quality of the financial institution, that the credit risk with regard to these deposits is not significant. The Company sells its instrument, related consumables, sample processing services, custom RUO assay design and collaborative development services primarily to biopharmaceutical companies, academic institutions and molecular labs. The Company routinely assesses the financial strength of its customers and credit losses have been minimal to date. The Company’s top two customers accounted for 72% and 10% of the Company’s total revenue for the three months ended September 30, 2018, compared with 57% and 10% for the three months ended September 30, 2017. The top two customers accounted for 63% and 10% of the Company’s total revenue for the nine months ended September 30, 2018, compared to 35% and 13% for the nine months ended September 30, 2017. The top two customers accounted for approximately 75% and 8% of the Company’s accounts receivable as of September 30, 2018, compared with approximately 66% and 11% as of December 31, 2017. The largest of these amounts represents accounts receivable relating to statements of work entered into under the Company’s Governing Agreement with QML. The Company currently relies on a single supplier to supply a subcomponent used in the HTG EdgeSeq processors. A loss of this supplier could significantly delay the delivery of processors, which in turn would materially affect the Company’s ability to generate revenue. Recently Adopted Accounting Pronouncements In May 2014, the FASB issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers In March 2016, the FASB issued ASU No. 2016-08, Revenue Recognition: Clarifying the new Revenue Standard’s Principal-Versus-Agent Guidance In April 2016, the FASB issued ASU No. 2016-10, Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing In May 2016, the FASB issued ASU No. 2016-12, Revenue from Contracts with Customers (Topic 606): Narrow Scope Improvements and Practical Expedients. The new revenue standard and the standards that amend it were effective for public entities for fiscal years and interim periods within those fiscal years beginning after December 15, 2017, using either of the following transition methods: (i) a full retrospective approach reflecting the application of the standard in each prior reporting period with the option to elect certain practical expedients, or (ii) a retrospective approach with the cumulative effect of initially adopting ASU 2014-09 recognized at the date of adoption (which includes additional footnote disclosures). The Company adopted ASC 606 as of January 1, 2018 using the full retrospective approach. The adoption of ASC 606 did not have a material impact on 2017 revenue recognition or on opening equity, as the timing and measurement of revenue recognition is materially the same for the Company as under ASC 605. The Company has presented additional quantitative and qualitative disclosures regarding identified revenue streams and performance obligations beginning with the first quarter ended March 31, 2018 (see Note 9 and Note 16). The Company has also identified and implemented changes to its business processes and internal controls relating to implementation of the new standard. In January 2016, the FASB issued ASU No. 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities, In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments, In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash In May 2017, the FASB issued ASU No. 2017-09, Compensation – Stock Compensation (Topic 718): Scope of Modification Accounting New Accounting Pronouncements The following are new FASB ASUs that have not been adopted by the Company as of September 30, 2018, grouped by their respective effective dates: January 1, 2019 In February 2016, the FASB issued ASU No. 2016-02, Leases, which was subsequently amended by ASU No. 2018-01, ASU No. 2018-10 and ASU NO. 2018-11 In July 2017, the FASB issued ASU 2017-11, Accounting for Certain Financial Instruments with Down Round Features In June 2018, the FASB issued ASU No. 2018-07, Compensation – Stock Compensation (Topic 718): Improvements to Nonemployee Share-based Payment Accounting January 1, 2020 In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement – Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement In November 2018, the FASB issued ASU No. 2018-18, which amended ASC 808, Collaborative Arrangements Revenue from Contracts with Customers |
Inventory
Inventory | 9 Months Ended |
Sep. 30, 2018 | |
Inventory Disclosure [Abstract] | |
Inventory | Note 3. Inventory Inventory, net of allowance, consisted of the following as of the dates indicated: September 30, December 31, 2018 2017 Raw materials $ 843,973 $ 984,328 Work in process 152,458 66,314 Finished goods 172,064 192,021 Total gross inventory 1,168,495 1,242,663 Less inventory allowance (39,403 ) (62,142 ) $ 1,129,092 $ 1,180,521 The reserve for shrinkage and excess inventory was $39,403 and $62,142 as of September 30, 2018 and December 31, 2017, respectively. For the three and nine months ended September 30, 2018, the Company recorded net decreases in the inventory reserve of $22,926 and $22,739, respectively, compared to net decreases of $21,405 and $83,832, respectively, for the three and nine months ended September 30, 2017, to adjust for estimated shrinkage and obsolescence. For the three and nine months ended September 30, 2018, the Company recorded adjustments to provision for excess inventory of $40,307 and $63,840, respectively. For the three and nine months ended September 30, 2017, the Company recorded adjustments to provision for excess inventory of $58,059 and $302,085, respectively. Adjustments in these periods to the allowance for estimated shrinkage, obsolescence and excess inventory have been included in cost of revenue in the accompanying interim unaudited |
Fair Value Instruments
Fair Value Instruments | 9 Months Ended |
Sep. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value Instruments | Note 4. Fair Value Instruments Financial assets and liabilities measured at fair value are classified in their entirety in the fair value hierarchy based on the lowest level input significant to the fair value measurement. The following table classifies the Company’s financial assets and liabilities measured at fair value on a recurring basis at September 30, 2018 and December 31, 2017, respectively: Balance at September 30, 2018 Level 1 Level 2 Level 3 Total Asset included in: Cash and cash equivalents Money market securities $ 6,105,380 $ — $ — $ 6,105,380 Investments available-for-sale at fair value U.S. government obligations 9,995,100 — — 9,995,100 Corporate debt securities — 17,617,931 — 17,617,931 Total $ 16,100,480 $ 17,617,931 $ — $ 33,718,411 Balance at December 31, 2017 Level 1 Level 2 Level 3 Total Asset included in: Cash and cash equivalents Money market securities $ 8,521,054 $ — $ — $ 8,521,054 Total $ 8,521,054 $ — $ — $ 8,521,054 There are no other financial instruments subject to fair value measurement on a recurring basis. Transfers to and from Levels 1, 2 and 3 are recognized at the end of the reporting period. There were no transfers between levels for the three and nine months ended September 30, 2018 or for the year ended December 31, 2017. Level 1 instruments include investments in money market funds, U.S. Treasuries and U.S. government agency obligations. These instruments are valued using quoted market prices for identical unrestricted instruments in active markets. The Company defines active markets for debt instruments based on both the average daily trading volume and the number of days with trading activity. Level 2 instruments include corporate debt securities. Valuations of Level 2 instruments can be verified to quoted prices, recent trading activity for identical or similar instruments, broker or dealer quotations or alternative pricing sources with reasonable levels of price transparency. Consideration is given to the nature of the quotations (e.g., indicative or firm) and the relationship of recent market activity to the prices provided from alternative pricing sources. Fair values of these assets are based on prices provided by independent market participants that are based on observable inputs using market-based valuation techniques. These valuation models and analytical tools use market pricing or similar instruments that are both objective and publicly available, including matrix pricing or reported trades, benchmark yields, broker/dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids and/or offers. The Company did not adjust any of the valuations received from these third parties with respect to any of its Level 1 or 2 securities for the nine-month period ended September 30, 2018 or the year-ended December 31, 2017 and did not have any Level 3 financial assets or liabilities during either of these periods. |
Available for Sale Securities
Available for Sale Securities | 9 Months Ended |
Sep. 30, 2018 | |
Investments Debt And Equity Securities [Abstract] | |
Available-for-Sale Securities | Note 5. Available-for-Sale Securities The Company’s portfolio of available-for-sale securities consists of U.S. Treasuries and high credit quality corporate debt securities. The following is a summary of the Company’s available-for-sale securities at September 30, 2018: September 30, 2018 Gross Gross Fair Value Amortized Unrealized Unrealized (Net Carrying Cost Gains Losses Amount) U.S. Treasury securities $ 10,002,727 $ — $ (7,627 ) $ 9,995,100 Corporate debt securities 17,619,186 — (1,255 ) 17,617,931 Total available-for-sale securities $ 27,621,913 $ — $ (8,882 ) $ 27,613,031 The Company had no available-for-sale securities at December 31, 2017. The net adjustment to unrealized holding gains (losses) on available-for-sale securities, net of tax in other comprehensive income totaled $2,457 and $(8,882) for the three and nine months ended September 30, 2018, and $0 and $1,090 Contractual maturities of debt investment securities at September 30, 2018 are shown below. Expected maturities will differ from contractual maturities because the issuers of the securities may have the right to prepay obligations without prepayment penalties. Under 1 Year 1 to 2 Years Total U.S. Treasury securities $ 9,995,100 $ — $ 9,995,100 Corporate debt securities 17,617,931 — 17,617,931 Total available-for-sale securities $ 27,613,031 $ — $ 27,613,031 The following table shows the gross unrealized losses and fair values of the Company’s investments that have unrealized losses, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position as of September 30, 2018: Under 1 Year 1 to 2 Years Total Gross Gross Gross Fair Unrealized Fair Unrealized Fair Unrealized Value Losses Value Losses Value Losses U.S. Treasury securities $ 9,995,100 $ (7,627 ) $ — $ — $ 9,995,100 $ (7,627 ) Corporate debt securities 2,399,726 (1,255 ) — — 2,399,726 (1,255 ) Total available-for-sale securities with unrealized losses $ 12,394,826 $ (8,882 ) $ — $ — $ 12,394,826 $ (8,882 ) For debt securities, the Company determines whether it intends to sell or if it is more likely than not that it will be required to sell impaired securities. This determination considers current and forecasted liquidity requirements, regulatory and capital requirements and securities portfolio management. For all impaired debt securities for which there was no intent or expected requirement to sell, the evaluation considers all available evidence to assess whether it is likely the amortized cost value will be recovered. The Company conducts a regular assessment of its debt securities with unrealized losses to determine whether securities have other-than-temporary impairment considering, among other factors, the nature of the securities, credit rating or financial condition of the issuer, the extent and duration of the unrealized loss, expected cash flows of underlying collateral, market conditions and whether the Company intends to sell or it is more likely than not that the Company will be required to sell the debt securities. The Company did not have any other-than-temporary impairment in its available-for-sale securities at September 30, 2018. |
Property and Equipment
Property and Equipment | 9 Months Ended |
Sep. 30, 2018 | |
Property Plant And Equipment [Abstract] | |
Property and Equipment | Note 6. Property and Equipment Property and equipment, net, consists of the following as of the dates indicated: September 30, December 31, 2018 2017 Furniture & fixtures $ 771,767 $ 582,007 Leasehold improvements 1,895,216 1,863,698 Equipment used in manufacturing 2,176,188 1,963,558 Equipment used in research & development 1,456,954 1,328,556 Equipment used in the field 130,552 130,552 Software 373,683 373,683 Construction in progress 117,447 255,641 6,921,807 6,497,695 Less: accumulated depreciation and amortization (4,307,187 ) (3,192,805 ) $ 2,614,620 $ 3,304,890 Depreciation and leasehold improvement amortization expense was $347,886 and $1,126,230 for the three and nine months ended September 30, 2018, respectively, and $305,868 and $893,334 for the three and nine months ended September 30, 2017, respectively. |
Accrued Liabilities
Accrued Liabilities | 9 Months Ended |
Sep. 30, 2018 | |
Accrued Liabilities Current [Abstract] | |
Accrued Liabilities | Note 7. Accrued Liabilities Accrued liabilities consist of the following as of the dates indicated: September 30, December 31, 2018 2017 Accrued employee bonuses $ 1,407,730 $ 3,049,109 Payroll and employee benefit accruals 607,580 369,275 Accrued professional fees 130,190 101,150 Accrued interest 130,509 45,544 Other accrued liabilities 254,606 181,708 $ 2,530,615 $ 3,746,786 |
Debt Obligations
Debt Obligations | 9 Months Ended |
Sep. 30, 2018 | |
Debt Disclosure [Abstract] | |
Debt Obligations | Note 8. Debt Obligations Growth Term Loan Total amortization expense for warrant, final fee and original issuance discounts in connection with the growth capital term loans under the Loan and Security Agreement dated August 22, 2014 between the Company and Oxford Finance, LLC and Silicon Valley Bank (the “Growth Term Loan”) was $0 and $59,969 for the three and nine months ended September 30, 2018, respectively, and $89,836 and $310,567 for the three and nine months ended September 30, 2017, respectively, and is included in interest expense in the accompanying interim unaudited condensed statements of operations. Deferred financing cost amortization expense relating to the Growth Term Loan was $0 and $2,982 for the three and nine months ended September 30, 2018, respectively, and $4,362 and $14,950 for the three and nine months ended September 30, 2017, respectively, and is included in interest expense in the accompanying interim unaudited interim unaudited Extinguishment of Growth Term Loan upon MidCap Credit Facility Closing In March 2018, the Company repaid all principal and interest amounts outstanding under the Growth Term Loan in an aggregate amount equal to approximately $4.3 million, including collateral agent legal fees and prepayment fees. The repayment was funded with net proceeds from the MidCap Credit Facility (see description of the MidCap Credit Facility below). As a result of the repayment, the Company recorded a loss on extinguishment of the Growth Term Loan of $0 for the three months ended September 30, 2018 and $105,064, including remaining unamortized discounts of $67,272 and prepayment and other Growth Term Loan lender fees in the accompanying condensed statements of operations for the nine months ended September 30, 2018. MidCap Credit Facility On March 26, 2018 (the “MidCap Closing Date”), the Company entered into a Credit and Security Agreement (Term Loan) (the “MidCap Term Loan”) and a Credit and Security Agreement (Revolving Loan) (the “MidCap Revolving Loan” and together with the MidCap Term Loan, the “MidCap Credit Facility”) with MidCap Financial Trust, as agent. MidCap Financial Trust subsequently assigned its rights and obligations as agent to MidCap Funding IV Trust. The MidCap Term Loan provides a secured term loan facility in an aggregate principal amount of up to $20.0 million. The Company borrowed the first advance of $7.0 million (“MidCap Tranche 1”) on the MidCap Closing Date. Under the terms of the MidCap Term Loan, the second advance of $13.0 million (“MidCap Tranche 2”) will be available to the Company on or before September 30, 2019, subject to the Company’s satisfaction of certain conditions described in the MidCap Term Loan, including (a) the Company achieving the first commercial sale of an FDA-approved diagnostic assay utilizing next generation sequencing under its Governing Agreement with QML, and (b) delivery to MidCap of subordination documents in respect of the QNAH Convertible Note (or the satisfaction of alternative arrangements as provided in the MidCap Term Loan, as described below). MidCap Tranche 1 was used to repay in full all outstanding amounts and fees due under the Growth Term Loan. The proceeds remaining from MidCap Tranche 1 and, if borrowed, the proceeds from MidCap Tranche 2, are expected to be used for working capital and general corporate purposes. MidCap Tranche 1, and if borrowed, MidCap Tranche 2, each bear interest at a floating rate equal to 7.25% per annum, plus the greater of (i) 1.25% or (ii) one-month LIBOR. Interest on each term loan advance is due and payable monthly in arrears and was calculated at a rate of 9.340% for interest accrued as of September 30, 2018. Principal on each term loan advance is payable in 36 equal monthly installments beginning April 1, 2020 until paid in full on March 1, 2023. Prepayments of the term loans under the MidCap Term Loan, in whole or in part, will be subject to early termination fees in an amount equal to 3.0% of principal prepaid if prepayment occurs on or prior to the first anniversary of the MidCap Closing Date, 2.0% of principal prepaid if prepayment occurs after the first anniversary of the MidCap Closing Date but on or prior to the second anniversary of the MidCap Closing Date, and 1.0% of principal prepaid if prepayment occurs after the second anniversary of the MidCap Closing Date and prior to or on the third anniversary of the MidCap Closing Date. In connection with execution of the MidCap Term Loan, the Company paid MidCap a $100,000 origination fee. Upon termination of the MidCap Term Loan, the Company is required to pay an exit fee equal to 4.50% of the principal amount of all term loans advanced to the Company under the MidCap Term Loan. The MidCap Term Loan also required that the Company deliver subordination documents with respect to the QNAH Convertible Note, or that the QNAH Convertible Note otherwise be converted or prepaid, on or before June 30, 2018, and required the Company to deposit approximately $3.3 million into an escrow account by July 15, 2018 if neither event occurred by such date. As neither event occurred prior to June 30, 2018, the Company deposited approximately $3.3 million into an escrow account on July 11, 2018. Such escrowed funds will be released to the Company upon subsequent delivery of the requisite subordination documents or conversion of the QNAH Convertible Note. If neither delivery of the subordination documents or conversion of the QNAH Convertible Note occurs, such funds will be applied by the escrow agent to repay in full the QNAH Convertible Note at maturity (or in connection with a prepayment at the direction of the Company), subject to (i) the Company having drawn MidCap Tranche 2, (ii) the Company having unrestricted cash and cash equivalents held in a deposit or securities account subject to a control agreement in favor of the Agent in a minimum amount of $20.0 million and (iii) there being no default under the MidCap Credit Facility. The MidCap Revolving Loan provides a secured revolving credit facility in an aggregate principal amount of up to $2.0 million. The Company may request an increase in the total commitments under the MidCap Revolving Loan by up to an additional $8.0 million, subject to agent and lender approval and the satisfaction of certain conditions. Availability of the revolving credit facility under the MidCap Revolving Loan will be based upon a borrowing base formula and periodic borrowing base certifications valuing certain of the Company’s accounts receivable and inventory, as reduced by certain reserves, if any. Further, although the revolving credit facility was made available following establishment of required lockbox arrangements by the Company in June 2018, there were no amounts outstanding under the MidCap Revolving Loan as of September 30, 2018. The proceeds of any loans under the MidCap Revolving Loan may be used for working capital and general corporate purposes. Loans under the MidCap Revolving Loan accrue interest at a floating rate equal to 4.25% per annum, plus the greater of (i) 1.25% or (ii) one-month LIBOR. Accrued interest on the revolving loans will be paid monthly and revolving loans may be borrowed, repaid and re-borrowed until March 1, 2023, when all outstanding amounts must be repaid. Subject to certain exceptions, termination or permanent reductions of the revolving loan commitment under the MidCap Revolving Loan will be subject to termination fees in an amount equal to 3.0% of the commitment amount terminated or reduced if such termination or reduction occurs on or prior to the first anniversary of the MidCap Closing Date, 2.0% of the commitment amount terminated or reduced if such termination or reduction occurs after the first anniversary of the MidCap Closing Date but on or prior to the second anniversary of the MidCap Closing Date, and 1.0% of the commitment amount terminated or reduced if such termination or reduction occurs after the second anniversary of the MidCap Closing Date and prior to or on the third anniversary of the MidCap Closing Date. In connection with the MidCap Revolving Loan, the Company is required to pay customary fees, including an origination fee of 0.50% of the original commitment amount at closing (and an equivalent origination fee with respect to any increased commitments at the time of the applicable increase), a monthly unused line fee of 0.50% per annum based upon the average daily unused portion of the revolving credit facility and a monthly collateral management fee of 0.50% per annum based upon the average daily used portion of the revolving credit facility. The Company is also required to maintain a minimum drawn balance of not less 20% of availability under the revolving line. If the Company does not maintain such minimum drawn balance, it is required to pay monthly interest and fees as if an amount equal to 20% of availability had been drawn down under the revolving line. The Company’s obligations under the MidCap Credit Facility are secured by a security interest in substantially all of its assets, excluding intellectual property (which is subject to a negative pledge). Additionally, the Company’s future subsidiaries, if any, may be required to become co-borrowers or guarantors under the MidCap Credit Facility. The MidCap Credit Facility contains customary affirmative covenants and customary negative covenants limiting the Company’s ability and the ability of the Company’s subsidiaries, if any, to, among other things, dispose of assets, undergo a change in control, merge or consolidate, make acquisitions, incur debt, incur liens, pay dividends, repurchase stock and make investments, in each case subject to certain exceptions. Commencing with the calendar quarter ending on the later of (a) June 30, 2019 and (b) the last day of the calendar quarter in which MidCap Tranche 2 is funded, the Company must also comply with a financial covenant relating to trailing twelve-month minimum Net Revenue requirements (as defined in the MidCap Credit Facility), tested on a quarterly basis. The MidCap Credit Facility also contains customary events of default relating to, among other things, payment defaults, breaches of covenants, a material adverse change, delisting of the Company’s common stock, bankruptcy and insolvency, cross defaults with certain material indebtedness and certain material contracts, judgments, and inaccuracies of representations and warranties. Upon an event of default, agent and the lenders may declare all or a portion of the Company’s outstanding obligations to be immediately due and payable and exercise other rights and remedies provided for under the agreement. During the existence of an event of default, interest on the obligations could be increased by 3.0%. The Company granted the lender ten-year warrants to purchase 18,123 shares of the Company’s common stock at $7.73 per share as a result of Tranche 1. Upon drawdown of Tranche 2, the Company will issue additional ten-year warrants to purchase shares of the Company’s common stock in an aggregate amount equal to 2.0% of the amount drawn, divided by the exercise price per share for that tranche (defined as 1.5 times the volume-weighted average closing price of the Company’s common stock for the ten business days immediately preceding the business day before the issue date). The fair value of the warrants on the date of issuance was approximately $74,000, determined using the Black-Scholes option-pricing model, and was recorded as a discount to the MidCap Term Loan. The Company recognized approximately $648,204 of debt discount associated with the MidCap Term Loan, resulting from fees and debt issuance costs, in the accompanying interim unaudited condensed balance sheets as of September 30, 2018. Amortization of the debt discount associated with the MidCap Term Loan was approximately $39,910 and $83,766 for the three and nine months ended September 30, 2018 and was included in interest expense in the accompanying interim unaudited condensed statements of operations. Costs incurred in connection with the issuance of the Midcap Revolving Loan of $71,126 are presented as MidCap revolving loan costs in the accompanying interim unaudited condensed balance sheets as of September 30, 2018. Amortization of deferred MidCap revolving loan costs was $4,058 and $8,294 for the three and nine months ended September 30, 2018, respectively, and are included in interest expense in the accompanying interim unaudited condensed statements of operations. Other Debt Obligations to Related Parties Refer to Note 16 below for discussion of debt obligation to related parties. |
Revenue from Contracts with Cus
Revenue from Contracts with Customers | 9 Months Ended |
Sep. 30, 2018 | |
Revenue From Contract With Customer [Abstract] | |
Revenue from Contracts with Customers | Note 9. Revenue from Contracts with Customers Revenue from contracts with customers is recognized when, or as, the Company satisfies its performance obligations by delivering the promised goods or service deliverables to the customers. A good or service deliverable is transferred to a customer when, or as, the customer obtains control of that good or service deliverable. A performance obligation may be satisfied over time or at a point in time. Revenue from a performance obligation satisfied over time is recognized by measuring the Company’s progress in satisfying the performance obligation in a manner that depicts the transfer of the goods or services to the customer. Revenue from a performance obligation satisfied at a point in time is recognized at the point in time that the Company determines the customer obtains control over the promised good or service deliverable. The amount of revenue recognized reflects the consideration the Company expects to be entitled to in exchange for those promised goods or services ( i.e. Product and Product-related Services Revenue The Company had product and product-related services revenue consisting of revenue from the sale of instruments and consumables and the use of the HTG EdgeSeq proprietary technology to process samples and design custom RUO assays for the three and nine months ended September 30, 2018 and 2017 as follows: Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Product revenue: Instruments $ 24,844 $ 199,205 $ 309,711 $ 370,263 Consumables 427,899 426,400 1,273,011 1,203,663 Total product revenue 452,743 625,605 1,582,722 1,573,926 Product-related services revenue: Custom RUO assay development 262,044 73,567 565,768 419,515 Sample processing 600,057 893,618 2,923,212 2,428,863 Total product-related services revenue 862,101 967,185 3,488,980 2,848,378 Total product and product-related services revenue $ 1,314,844 $ 1,592,790 $ 5,071,702 $ 4,422,304 Because the Company’s agreements for product and product-related services revenue have an expected duration of one year or less, the Company has elected the practical expedient in ASC 606-10-50-14(a) to not disclose information about its remaining performance obligations. Sale of Instruments and Consumables The delivery of each instrument and related installation and calibration are considered to be a single performance obligation, as the HTG EdgeSeq instrument must be professionally installed and calibrated prior to use. Instrument product revenue is generally recognized upon installation and calibration of the instrument by field service engineers, which represents the point at which the customer has the ability to use the instrument and has accepted the asset. Installation generally occurs within one month of instrument shipment. The delivery of each consumable is a separate performance obligation. Consumables revenue is recognized upon transfer of control, which represents the point when the customer has legal title and the significant risks of ownership of the asset. The Company’s standard terms and conditions provide that no right of return exists for instruments and consumables, unless replacement is necessary due to delivery of defective or damaged product. Customer payment terms vary but are typically between 30 and 90 days of revenue being earned from shipment or delivery, as applicable. Shipping and handling fees charged to the Company’s customers for instruments and consumables shipped are included in the accompanying interim unaudited condensed statements of operations as part of product and product-related services revenue. Shipping and handling costs for sold products shipped to the Company’s customers are included in the accompanying interim unaudited condensed statements of operations as part of cost of revenue. For sales of consumables in the United States, standard delivery terms are FOB shipping point, unless otherwise specified in the customer contract, reflecting transfer of control to the customer upon shipment. The Company has elected the practical expedient to account for shipping and handling as activities to fulfill the promise to transfer the consumables. The Company provides instruments to certain customers under reagent rental agreements. Under these agreements, the Company installs instruments in the customer’s facility without a fee and the customer agrees to purchase consumable products at a stated price over the term of the agreement; in some instances, the agreements do not contain a minimum purchase requirement. Terms range from several months to multiple years and may automatically renew in several month or multiple year increments unless either party notifies the other in advance that the agreement will not renew. The Company measures progress toward complete satisfaction of its performance obligation to provide the instrument and deliver the consumables using an output method based on the number of consumables delivered in relation to the total consumables to be provided under the reagent rental agreement. This is considered to be representative of the delivery of outputs under the arrangement and the best measure of progress because the customer benefits from the instrument only in conjunction with the consumables. The Company expects to recover the cost of the instrument under the agreement through the fees charged for consumables, to the extent sold, over the term of the agreement. In reagent rental agreements, the Company retains title to the instrument and title is transferred to the customer at no additional charge at the conclusion of the initial arrangement. The cost of the instrument is amortized on a straight-line basis over the term of the arrangement, unless there is no minimum consumable product purchase in which case the instrument would be expensed as cost of revenue upon installation. Cost to maintain the instrument while title remains with the Company is charged to selling, general and administrative expense as incurred. Sample Processing The Company also provides sample preparation and processing services and molecular profiling of retrospective cohorts for its customers through its VERI/O laboratory, whereby the customer provides samples to be processed using HTG EdgeSeq technology specified in the order. Customers are charged a per sample fee for sample processing services which is recognized as revenue upon delivery of a data file to the customer showing the results of testing and completing delivery of the agreed upon service. This is when the customer can use and benefit from the results of testing and the Company has the present right to payment. Custom RUO Assay Design and Related Agreements The Company enters into custom RUO assay design agreements that may generate up-front fees and subsequent payments that might be earned upon completion of design process phases. The Company measures progress toward complete satisfaction of its performance obligation to perform custom RUO assay design using an output method based on the costs incurred to date compared to total expected costs, as this is representative of the delivery of outputs under the arrangements and the best measure of progress. However, because in most instances the assay development fees are contingent upon completion of each phase of the design project and the decision of the customer to proceed to the next phase, the amount to be included in the transaction price and recognized as revenue is limited to that which the customer is contractually obligated to pay upon completion of that phase, which is when it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur. Bristol-Myers Squibb Company Agreement In May 2016, the Company entered into a Collaboration Agreement with Bristol-Myers Squibb Company (“BMS”) for the design of at least two custom RUO assays for BMS based on the Company’s HTG EdgeSeq technology. Following design of each assay, at BMS’s request, the Company may also perform sample processing services using such custom RUO assay(s) and/or supply the custom RUO assay(s) to BMS or its third-party subcontractors. Additional custom RUO assay design services related to immuno-oncology research may be undertaken pursuant to the agreement in accordance with a mutually acceptable work plan, which is incorporated by written amendment. BMS paid an initial non-refundable, non-creditable program set-up fee upon initiation of the agreement, and has agreed to pay an annual non-refundable, non-creditable project management fee in quarterly installments as well as a custom RUO assay design fee for each assay designed. In January 2018, the Company and BMS amended the terms of the parties’ Collaboration Agreement to increase the development fee payable by BMS to the Company for each of the two, initial custom RUO assays contemplated by the agreement from a low six-figure range to a mid six-figure dollar amount, and to modify certain custom RUO assay design requirements. With the amendment of the agreement, the Company estimates that the first custom research assay design project initiated under this agreement will be completed before December 31, 2018. See contract liabilities note below for further discussion of the impact of this modification on the Collaboration Agreement. The Company has determined that the agreement does not meet the definition of a collaborative arrangement and that BMS meets the definition of a customer under ASC 606. Additionally, each SOW issued for an RUO custom assay design project contemplated by the agreement represents a single performance obligation to provide custom RUO assay design services. In addition, if BMS should opt to purchase completed custom RUO assay kits or sample processing services, these add-on services would not be combined with the custom RUO assay design performance obligations. Instead, these would be additional contracts with BMS accounted for using the Company’s policy for consumable product and sample processing revenue recognition under ASC 606 at the time such request is made. The initial set-up fee is a fixed fee and is included in the transaction price. The RUO custom assay design fee relating to each assay design project contemplated under the agreement represents variable consideration because the assay design fees are contingent upon completion of each phase of the design project and the decision of BMS to proceed to the next phase. The quarterly project management fees represent variable consideration because they are payable by BMS through the completion of the second of the two custom assay design projects or termination of the agreement. The Company uses the most likely amount method to measure the variable consideration for its RUO custom assay design fees, which are constrained and excluded from the transaction price until BMS is contractually obligated to pay the fees upon completion of that phase, which is when it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur. The initial set-up fee is included in the transaction price and is being recognized as revenue using an output method that measures progress based on the specific output provided to BMS, such as an internal document generated, or conclusion reached. The agreement will expire on May 11, 2019 or, if a project is then ongoing, the date of delivery of the final report for such project. Either party may terminate the agreement upon the other party’s material breach or default in the performance of a material obligation under the agreement or if certain warranties or representations are untrue in any material respect (each a “BCA Default”) and such BCA Default remains uncured for 60 90 For the three and nine months ended September 30, 2018, $166,714 and $298,938, respectively, was recognized under the agreement as product and product-related services revenue in the accompanying interim unaudited condensed statements of operations, compared to $31,250 and $93,750 for the three and nine months ended September 30, 2017, respectively. Contract liabilities relating to this agreement of $79,918 and $160,106 were included in the accompanying interim unaudited condensed balance sheets as of September 30, 2018 and December 31, 2017, respectively. As of September 30, 2018, the aggregate amount of the transaction price allocated to the partially unsatisfied performance obligation was $50,000. The Company expects to recognize the revenue for this amount between October 2018 and December 2019 using the same output method that the Company uses for its custom RUO assay design performance obligations with BMS. Collaborative Development Services Revenue Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Collaborative development services $ 3,391,534 $ 2,130,694 $ 8,704,094 $ 2,433,105 See Note 16 for discussion of collaborative development services contracts with related parties. There was no collaborative development services revenue generated from the Company’s companion diagnostic development services agreements with non-related party customers for the three and nine months ended September 30, 2018. This includes the Company’s Master CDx Agreement with Merck KGaA, Darmstadt, Germany, for which there have been no significant modifications or financial events relating to the agreement since the disclosures made by the Company in its Annual Report on Form 10-K, filed with the SEC on March 23, 2018. The Company earned the first milestone-based payment under the Master CDx Agreement in the second quarter of 2017. There were no additional milestone payments earned or financial events relating to this collaborative development agreement in the third quarter of 2017. As such, collaborative development services revenue of $0 and $25,000 was recognized for the three and nine months ended September 30, 2017, respectively, related to this agreement. Contract Liabilities The Company receives up-front payments from customers for custom RUO assay design services, and occasionally for sample processing services. Payments for instrument extended warranty contracts are made in advance as are payments for certain agreed-upon capital purchases required for collaborative development service projects. The Company recognizes such up-front payments as a contract liability. The contract liability is subsequently reduced at the point in time that the data file is delivered for sample processing services or as the Company satisfies its performance obligations over time for RUO assay design, collaborative development and extended warranty services. Contract liabilities of $387,975 and $837,885 were included in contract liabilities – current and other non-current liabilities in the accompanying unaudited condensed balance sheets as of September 30, 2018 and December 31, 2017, respectively. Changes in the Company’s contract liability were as follows as of the date indicated: Product Revenue Custom RUO Assay Design Sample Processing Collaborative Development Services Total Contract Liability Balance at January 1, 2018 $ 39,426 $ 197,606 $ 490,536 $ 110,317 $ 837,885 Deferral of revenue 151,461 336,080 166,291 70,918 724,750 Recognition of deferred revenue (135,980 ) (453,768 ) (403,677 ) (181,235 ) (1,174,660 ) Balance at September 30, 2018 $ 54,907 $ 79,918 $ 253,150 $ — $ 387,975 Included in recognition of deferred revenue for the three and nine months ended September 30, 2018 was a cumulative catch up adjustment of $0 and $30,055, respectively, to custom RUO assay design revenue relating to the January 2018 modification of the Company’s Collaboration Agreement with BMS for custom RUO assay design discussed above. |
Other Agreements
Other Agreements | 9 Months Ended |
Sep. 30, 2018 | |
Other Agreements [Abstract] | |
Other Agreements | Note 10. Other Agreements NuvoGen Obligation Pursuant to the Company’s asset purchase agreement with NuvoGen Research, LLC (“NuvoGen”), as amended, the Company is obligated to pay NuvoGen the greater of $400,000 or 6% of annual revenue until the obligation is paid in full. Although an amendment to the agreement allowed for deferral of any revenue-based payments through December 31, 2017, no revenue-based payments were deferred. In addition to fixed quarterly payments of $100,000, revenue-based payments of $182,383 and $85,574 were payable as of September 30, 2018 and December 31, 2017, respectively. There have been no significant modifications to the terms and conditions of the Company’s NuvoGen obligation since the disclosures made in the Company’s Annual Report on Form 10-K, filed with the SEC on March 23, 2018. The minimum remaining payments due to NuvoGen at September 30, 2018, including $182,383 of additional revenue-based payments payable as of September 30, 2018, are as follows for each fiscal year, although actual payments could be significantly more than provided in the table, to the extent that 6% of the Company’s annual revenue exceeds $400,000: 2018 $ 282,383 2019 400,000 2020 400,000 2021 400,000 2022 400,000 2023 and beyond 5,286,621 Total NuvoGen obligation payments 7,169,004 Plus interest accretion 109,487 Total NuvoGen obligation, net $ 7,278,491 Illumina, Inc. Agreement In June 2017, the Company entered into an Amended and Restated Development and Component Supply Agreement with Illumina, Inc. (“Illumina”), effective May 31, 2017 (“Restated Agreement”), which amended and restated the parties’ IVD Test Development and Component Supply Agreement entered into in October 2014 (“Original Agreement”). The Restated Agreement provides for the development and worldwide commercialization by the Company of nuclease-protection-based RNA or DNA profiling tests (“IVD test kits”) for use with Illumina’s MiSeqDx sequencer in the field of diagnostic oncology testing in humans (“Field”). As a result of IVD test kit development plans submitted by the Company to Illumina in accordance with the Restated Agreement, the Company paid Illumina $0 and $12,500 for the three and nine months ended September 2018, respectively, compared to $0 and $50,000 for the three and nine months ended September 30, 2017, respectively. Other Development Agreements There have been no significant modifications or financial events relating to the development agreements entered into by the Company in prior periods with Invetech PTY Ltd. since the disclosures made by the Company in its Annual Report on Form 10-K, filed with the SEC on March 23, 2018. |
Net Loss per Share
Net Loss per Share | 9 Months Ended |
Sep. 30, 2018 | |
Earnings Per Share [Abstract] | |
Net Loss per Share | Note 11. Net Loss Per Share Basic loss per common share is computed by dividing net loss by the weighted average number of common shares outstanding during the reporting period. Diluted loss per common share is computed similar to basic loss per The following table provides the numerator and denominator used in computing basic and diluted net loss per share for the periods indicated: Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Numerator: Net loss $ (4,843,408 ) $ (5,380,846 ) $ (14,326,084 ) $ (17,038,022 ) Denominator: Weighted-average shares outstanding-basic and diluted 28,434,406 11,603,617 27,184,968 9,794,651 Net loss per share, basic and diluted $ (0.17 ) $ (0.46 ) $ (0.53 ) $ (1.74 ) The following outstanding securities were excluded from the computation of diluted net loss per share for the periods presented because their effect would have been anti-dilutive: Nine Months Ended September 30, 2018 2017 Options to purchase common stock 2,148,323 1,532,979 Common stock warrants 237,846 219,723 Restricted stock units 249,166 34,999 QNAH convertible note 772,075 — |
Warrants
Warrants | 9 Months Ended |
Sep. 30, 2018 | |
Proceeds From Issuance Of Preferred Stock Preference Stock And Warrants [Abstract] | |
Warrants | Note 12. Warrants In connection with certain of its redeemable convertible preferred stock issuances, convertible debt financings and other financing arrangements, the Company has issued warrants for shares of its common stock and various issues of its redeemable convertible preferred stock which have since been converted to common stock warrants. There have been no significant modifications or financial events relating to the warrants that were issued prior to December 31, 2017 since the disclosures made by the Company in its Annual Report on Form 10-K, filed with the SEC on March 23, 2018. In March 2018, in connection with the Company’s entry into the MidCap Credit Facility (see Note 8), the Company issued warrants to purchase an aggregate of 18,123 shares of the Company’s common stock, at an exercise price equal to $7.73 per share as a result of the funding of MidCap Tranche 1. The warrants are immediately exercisable and expire on the earlier to occur of the tenth anniversary of the respective issue date or, in certain circumstances, the closing of a merger, sale or other consolidation transaction in which the consideration is cash, stock of a publicly traded acquirer, or a combination thereof. The following table shows the common stock warrants outstanding as of September 30, 2018: Shares of Common Exercise Price/Share Expiration Date 28,713 $ 23.51 2024 144,772 14.00 2022 931 6.45 2019 45,307 2.76 2026 18,123 7.73 2028 |
Stockholders Deficit
Stockholders Deficit | 9 Months Ended |
Sep. 30, 2018 | |
Equity [Abstract] | |
Stockholders' Deficit | Note 13. Stockholders’ Deficit Public Offerings ATM Offering In April 2017, the Company entered into a Controlled Equity Offering Sales Agreement (the “Sales Agreement”) with Cantor Fitzgerald & Co. (“Cantor”), as sales agent, pursuant to which the Company had the right to offer and sell, from time to time, through Cantor, shares of the Company’s common stock, par value $0.001 per share, by any method deemed to be an “at the market offering” as defined in Rule 415 under the Securities Act of 1933, as amended (the “ATM Offering”). In April 2017, the Company also filed a prospectus supplement (File No. 333-216977) with the SEC relating to the offer and sale of up to $20.0 million of common stock in the ATM Offering. In June 2017, the Company filed a first amendment to the prospectus supplement with the SEC to increase the amount of common stock that could be offered and sold in the ATM Offering under the Sales Agreement to $40.0 million in the aggregate, inclusive of the common stock previously sold in the ATM Offering prior to the date of the first amendment. In January 2018, the Company filed a second amendment to the prospectus supplement with the SEC to decrease the amount of common stock that could be offered and sold in the ATM Offering under the Sales Agreement to $23.0 million in the aggregate, inclusive of the common stock sold in the ATM Offering prior to the date of the second amendment. In February 2018, the Company and Cantor mutually agreed to terminate the Sales Agreement. Prior to termination of the Sales Agreement, the Company sold 5,733,314 shares of common stock under the ATM Offering at then-market prices for total gross proceeds of approximately $21.1 million, including 0.3 million shares of common stock sold for gross proceeds of $0.6 million during the first quarter ended March 31, 2018. After $0.6 million of sales commissions and $0.2 million of other offering expenses paid by the Company in connection with the ATM Offering, the Company’s aggregate net proceeds from the ATM Offering were approximately $20.2 million. Sales commissions and offering expenses have been recorded as a reduction of proceeds received in arriving at the amount recorded in additional paid-in capital in the accompanying interim unaudited condensed balance sheets as of September 30, 2018 and December 31, 2017. Underwritten Public Offering In January 2018, the Company completed an underwritten public offering of 13,915,000 shares of its common stock at a price of $2.90 per share, including 1,815,000 shares sold pursuant to the exercise in full of the underwriters’ option to purchase additional shares. The Company sold its common stock through an underwriting agreement with Leerink Partners LLC and Cantor as representatives of the underwriters for the offering. The aggregate net proceeds to the Company from the offering were approximately $37.7 million, after deducting the underwriting discounts and commissions and offering expenses. Stock-based Compensation A summary of the Company’s stock option activity for the nine months ended September 30, 2018 is as follows: Number of Shares Weighted- Average Exercise Price Per Share Weighted- Average Remaining Contractual Life (Years) Aggregate Intrinsic Value Balance at December 31, 2017 1,517,771 $ 2.97 7.5 $ 67,242 Granted 802,500 3.39 Exercised (96,164 ) 2.12 $ 182,678 Forfeited (35,679 ) 3.42 Expired/Cancelled (40,105 ) 6.81 Balance at September 30, 2018 2,148,323 $ 3.08 7.8 $ 4,624,110 Exercisable at September 30, 2018 1,258,202 $ 2.93 6.5 $ 3,065,442 As of September 30, 2018, there was total unrecognized compensation expense of $1,915,080 related to unvested stock options, which the Company expects to recognize over a weighted-average period of approximately 3.22 years. In June 2018, in connection with the retirement of two employees, the vesting of stock options covering 46,613 shares of common stock was accelerated, and the post-termination exercise period for the employees’ options was extended to a one year period from the termination date. As a result of this modification, the Company recorded incremental stock-based compensation expense of approximately $0 and $79,400 for the three and nine months ended September 30, 2018, respectively. A summary of restricted stock unit (“RSU”) activity for the nine months ended September 30, 2018 is as follows: Number of Shares Weighted- Average Grant Date Fair Value Per Share Balance at December 31, 2017 26,666 $ 2.78 Granted 492,051 3.63 Released (269,551 ) 3.76 Balance at September 30, 2018 249,166 $ 3.39 Vested and unissued at September 30, 2018 13,126 $ 3.40 Vested and unissued awards at September 30, 2018 represents RSU awards granted on August 16, 2018 for which the first vesting date was September 30, 2018, but for which issuance of the awards occurred on the next business day, October 1, 2018. Unrecognized compensation expense related to the remaining unvested RSUs was $766,054 at September 30, 2018, which the Company expects to recognize over a weighted-average remaining service period of 3.50 years. Stock-based compensation expense recorded in the accompanying interim unaudited condensed statements of operations for the three and nine months ended September 30, 2018 and 2017 was as follows: Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Selling, general and administrative $ 200,317 $ 251,924 $ 1,475,975 $ 826,098 Research and development 41,553 79,619 121,651 261,083 Cost of revenue 16,105 25,862 45,727 84,807 $ 257,975 $ 357,405 $ 1,643,353 $ 1,171,988 Stock-based compensation expense for the nine months ended September 30, 2018 included $1.0 million of selling, general and administrative compensation expense relating to the issuance of 259,551 shares under RSUs granted to the Company’s executive officers in January 2018 at a grant date fair value of $3.84 per share. The RSUs vested in full on January 29, 2018. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2018 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 14. Commitments and Contingencies Compensation Agreements In September 2017, the Company entered into an arrangement with certain of its non-executive officer employees to provide for retention bonus payments to those eligible employees providing continuing service to the Company through July 31, 2018 and December 31, 2018, with one half of the retention bonus commitment payable at each of these dates. For the three and nine months ended September 30, 2018 compensation expense of $249,467 and $722,280, respectively, has been included in the accompanying interim unaudited condensed statements of operations, compared to $87,965 for both the three and nine months ended September 30, 2017. The remaining retention bonuses will be accrued on a straight-line basis through December 31, 2018. No forfeiture rate has been estimated. Forfeitures will be recognized as they occur. Legal Matters The Company’s industry is characterized by frequent claims and litigation, including claims regarding intellectual property and product liability. As a result, the Company may be subject to various legal proceedings from time to time. The results of any current or future litigation cannot be predicted with certainty, and regardless of the outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources, and other factors. Any current litigation is considered immaterial and counter claims have been assessed as remote. Leases The Company leases office and laboratory space in Tucson, Arizona under two non-cancelable operating leases. There have been no changes to the Company’s office and laboratory space leases since the disclosures made by the Company in its Annual Report on Form 10-K, filed with the SEC on March 23, 2018. The Company’s remaining minimum real estate lease payments before common area maintenance charges for each fiscal year as of September 30, 2018 are as follows: 2018 $ 127,983 2019 514,977 2020 517,457 2021 43,139 $ 1,203,556 As of September 30, 2018, the Company also has remaining capital lease commitments consisting of approximately $87,444 for computer equipment varying in length from 36 to 48 months that has not been included in the minimum lease payments schedule above. Product Warranty The following is a summary of the Company’s general product warranty reserve for the periods indicated: Nine Months Ended September 30, 2018 2017 Beginning balance $ 37,156 $ 50,426 Cost of warranty claims (2,484 ) (6,278 ) Increase in warranty reserve 20,496 3,275 Ending balance $ 55,168 $ 47,423 Warranty reserve is included in accrued liabilities in the accompanying interim unaudited condensed balance sheets as of September 30, 2018 and December 31, 2017. Expense relating to the recording of this reserve is recorded in cost of revenue within the accompanying interim unaudited condensed statements of operations. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 15. Income Taxes The Company provides for income taxes based upon management’s estimate of taxable income or loss for each respective period. The Company recognizes an asset or liability for the deferred tax consequences of temporary differences between the tax bases of assets and liabilities and their reported amounts in the financial statements. These temporary differences would result in deductible or taxable amounts in future years, when the reported amounts of the assets are recovered or liabilities are settled, respectively. In each period since inception, the Company has recorded a valuation allowance for the full amount of its net deferred tax assets, as it is not more likely than not that these will be realized. As a result, the Company has not recorded any federal or state income tax benefit in the accompanying interim unaudited The Company periodically reviews its filing positions for all open tax years in all U.S. federal, state and international jurisdictions where the Company is or might be required to file tax returns or other required reports. The Company applies a two-step approach to recognizing and measuring uncertain tax positions. The Company evaluates the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained in a court of last resort. The term “more likely than not” means a likelihood of more than 50 percent. Otherwise, the Company may not recognize any of the potential tax benefit associated with the position. The Company recognizes a benefit for a tax position that meets the more likely than not criterion at the largest amount of tax benefit that is greater than 50 percent likely of being realized upon its effective resolution. Unrecognized tax benefits involve management’s judgment regarding the likelihood of the benefit being sustained. The final resolution of uncertain tax positions could result in adjustments to recorded amounts and may affect the Company’s results of operations, financial position and cash flows. The Company has not identified any uncertain tax positions at September 30, 2018 or December 31, 2017. The Company’s policy is to recognize interest and/or penalties related to income tax matters in income tax expense. The Company had no accrual for interest or penalties at September 30, 2018 and December 31, 2017, respectively, and has not recognized interest or penalties of significance during the three months ended September 30, 2018 and 2017, respectively, since there are no material unrecognized tax benefits. The Company has not made or had payments due for income taxes for the periods ended September 30, 2018 or December 31, 2017, other than state minimum taxes. Management believes no material change to the amount of unrecognized tax benefits will occur within the next 12 months. The Company has established a valuation allowance against the entire net deferred tax asset. A preliminary analysis of past and subsequent equity offerings by the Company, and other transactions that have an impact on the Company’s ownership structure, concluded that the Company may have experienced one or more ownership changes under Sections 382 and 383 of the Internal Revenue Code or IRC. Provisions of the IRC place special limitations on the usage of net operating losses and credits following an ownership change. Such limitations may limit or eliminate the potential future tax benefit to be realized by the Company from its accumulated net operating losses and research and development credits. On December 22, 2017, federal tax legislation commonly referred to as the Tax Cuts and Jobs Act (“Tax Act”) was signed into law. The Tax Act, among other changes, reduced the U.S. federal corporate tax rate from 35% to 21%, effective January 1, 2018. Consequently, for the year ended December 31, 2017, the Company recorded a decrease related to deferred tax assets of $16,232,211, exclusive of the corresponding change in the valuation allowance. Due to the full valuation allowance on the deferred tax assets, there was no net adjustment to the deferred tax expense or benefit due to the reduction of the corporate tax rate. Other changes effective January 1, 2018 include, but are not limited to, creating a new limitation on deductible interest expense, eliminating the corporate alternative minimum tax, modifying the rules related to uses and limitations of net operating loss carryforwards generated in tax years ending after December 31, 2017, limiting the deductibility of certain executive compensation, enhancing and liberalizing bonus depreciation, and changing the rules pertaining to the taxation of profits earned abroad. The Company expects to be subject to the new limitation on deductible interest expense in 2018; however, the disallowed interest may be carried forward indefinitely. The Company’s net operating losses generated in 2018 and thereafter, if any, will be subject to a new indefinite carryforward period; however, utilization of these net operating losses will be limited to 80% of taxable income in the year utilized. Net operating loss carryforwards existing as of December 31, 2017 will not be subject to this new limitation; however, those carryforwards will remain subject to the 20-year expiration period. |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2018 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Note 16. Related Party Transactions Master Assay Development, Commercialization and Manufacturing Agreement In November 2016, the Company entered into the Governing Agreement, which creates the framework for QML and the Company to combine their technological and commercial strengths to offer biopharmaceutical companies a complete NGS-based solution for the development, manufacture and commercialization of companion diagnostic assays. Under the Governing Agreement, the parties jointly seek companion diagnostic programs with biopharmaceutical companies, QML enters into sponsor project agreements with interested biopharmaceutical companies for specified projects, and QML and the Company enter into statements of work (each, an “SOW”), which set forth the rights and obligations of QML and the Company with respect to each project. There have been no significant modifications or financial events relating to the Governing Agreement since the disclosures made by the Company in its Annual Report on Form 10‑K, filed with the SEC on March 23, 2018, other than with regard to the initiation of new SOWs under the Governing Agreement as discussed below. The Company has determined that SOW One, SOW Two and SOW Three (each defined below) are collaborative arrangements and that QML meets the definition of a customer under ASC 606. Additionally, each SOW is a separate contract with a single performance obligation to provide development services. Under each SOW, QML pays the Company a monthly fee for development work performed by the Company and its subcontractors (collectively, the “Monthly Fee”). The Monthly Fee is based on the employee and materials costs incurred during the month, which is subject to significant variability from period to period and unknown until the costs are incurred. Therefore, the Monthly Fee, which is based on use of hours and costs as a measure of progress, is included in the transaction price and recognized as revenue over time when the costs are incurred and the Monthly Fee is billed to QML. It is at this time that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur. The Company and QML also will share any net profits resulting from performance of the development work as determined pursuant to the Governing Agreement. Such profit sharing payment(s) is deemed to be variable consideration using the expected value method and is included in the transaction price upon completion of the respective SOW deliverables, acceptance of corresponding deliverables, and the mutual agreement by QML and the Company on the calculation of net profit, which is when it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur. Because each SOW has an expected duration of one year or less, the Company has elected the practical expedient in ASC 606-10-50-14(a) to not disclose information about its remaining performance obligations for each SOW. Statement of Work No. One In June 2017, the Company and QML entered into the first statement of work under the Governing Agreement, which has been twice amended in December 2017 and March 2018 (collectively, “SOW One”). SOW One addressed the activities of the Company and QML in support of the development and potential commercialization of a next generation sequencing-based companion diagnostic assay that was the subject of a sponsor project agreement between QML and a biopharmaceutical company (“Pharma One”). In May 2018, SOW One was terminated by QML as a result of Pharma One’s termination of the development project. The Company discontinued development activities related to the project following wind down activities completed in the second quarter of 2018. Revenue of $0 and $2,397,136, including SOW One Monthly Fees and $0 and $99,394 of SOW One profit sharing payments has been included in collaborative development services revenue in the accompanying interim unaudited condensed statements of operations for the three and nine months ended September 30, 2018, respectively, compared to $846,368 and $1,123,779 including only SOW One Monthly Fees, for the three and nine months ended September 30, 2017, respectively. Accounts receivable relating to SOW One of $0 and $2,429,152 remained in the accompanying interim unaudited condensed balance sheets as of September 30, 2018 and December 31, 2017, respectively. Costs relating to development activities conducted by the Company pursuant to SOW One of $0 and $1,716,115 have been included in research and development expense in the accompanying interim unaudited condensed statements of operations for the three and nine months ended September 30, 2018, respectively, compared to $653,938 and $876,186 for the three and nine months ended September 30, 2017, respectively. Statement of Work No. Two In October 2017, the Company and QML entered into the second statement of work under the Governing Agreement (“SOW Two”), which was made effective as of June 2, 2017 (“Onset Date”). The Company and QML amended SOW Two twice in August 2018 and an additional time in September 2018. SOW Two addresses development activities conducted by the Company and QML since the Onset Date and those expected to be further conducted by parties in connection with what is expected to be a multi-stage project leading to the potential development and commercialization of an NGS-based companion diagnostic assay in support of one or more therapeutic development and commercialization programs for a third-party pharmaceutical company. The initial-phase investigational use only (“IUO”) development activities under SOW Two have been completed and the first two amendments of SOW Two relate to the next phases, which include the use of the IUO assay developed in the initial-phase in a retrospective clinical trial and in additional disease indications. The third amendment to SOW Two provides that profit sharing relating to the original development activities and the development activities contemplated by the first SOW Two amendment will, in each case, commence upon the later of (i) the third amendment effective date, which is September 27, 2018, and (ii) the completion of the respective development activities, rather than at the end of each calendar quarter, provided that such modification to the profit-sharing commencement date only applies to development activities that had not yet been subject to profit-sharing as of the third amendment effective date. QML will continue to pay the Company for the development services to be performed under SOW Two. The Company and QML will share in any net profits (as determined under the Governing Agreement) generated during the work on an approximately quarterly basis throughout the term of SOW Two, except as otherwise specified in the third amendment to SOW Two. The Supplement Agreement initially entered into concurrent with SOW Two was also amended in August 2018 and made effective as of July 2018. This amendment establishes certain rights and obligations of the parties with regard to confidential information and other intellectual property needed to perform, and/or produced as a result of the next phase project activities contemplated by the SOW Two amendments and does not materially change the terms and conditions agreed upon by the parties in the original Supplement Agreement. Revenue of $2,184,493 and $3,665,311, including SOW Two Monthly Fees and $439,910 and $826,279 of SOW Two profit sharing payments, has been included in collaborative development services revenue in the accompanying interim unaudited condensed statements of operations for the three and nine months ended September 30, 2018, respectively. Accounts receivable relating to SOW Two of $1,537,518 and $1,796,157 remained in the accompanying interim unaudited condensed balance sheets as of September 30, 2018 and December 31, 2017, respectively. Costs relating to development activities conducted by the Company pursuant to SOW Two of $1,667,303 and $2,431,445 have been included in research and development expense in the accompanying interim unaudited condensed statements of operations for the three and nine months ended September 30, 2018, respectively. No costs or revenue relating to SOW Two were included in the accompanying interim unaudited condensed statements of operations for the three and nine months ended September 30, 2017 as SOW Two was not established until October 2017. Statement of Work No. Three In January 2018, the Company and QML entered into a third statement of work under the Governing Agreement (“SOW Three”) and amended SOW Three in September 2018. SOW Three relates to development activities for a next generation sequencing-based clinical-trial assay (“SOW Three Project”) in connection with a sponsor project agreement between QML and a pharmaceutical company (“Pharma Three”). Initial assay development activities under SOW Three have been completed, and the first amendment to SOW Three provides for the development of an IUO assay, subsequent retrospective testing of clinical trial samples, design verification and, subject to satisfactory achievement of relevant performance and regulatory milestones, regulatory submissions in the United States and European Union necessary for the commercialization of a companion diagnostic for a corresponding Pharma Three drug. Under the terms of SOW Three, the Company has agreed to assign its rights in certain SOW Three Project-related intellectual property (“Project IP”) predominantly related to Pharma Three’s drug candidate(s) to QML for ultimate assignment to Pharma Three in accordance with the sponsor project agreement between QML and Pharma Three. Improvements to the background intellectual property of the Company, QML and Pharma Three generally will be owned solely by the respective party. Otherwise, Project IP will be jointly owned among the Company, QML and Pharma Three. The development activities to be performed under SOW Three are expected to extend through the first half of the fiscal year ended December 31, 2020, with key development milestones, testing and regulatory filings occurring throughout the period . QML will pay the Company for the development services performed for SOW Three. In addition, the Company and QML will share in any net profits (as determined under the Governing Agreement) generated during the work on an approximately quarterly basis throughout the term of SOW Three. Revenue of $1,207,041 and $2,641,647, including SOW Three Monthly Fees and $209,140 and $355,631, respectively, relating to SOW Three profit sharing payments, have been included in collaborative development services revenue in the accompanying interim unaudited condensed statements of operations for the three and nine months ended September 30, 2018, respectively. Accounts receivable relating to SOW Three of $994,157 and $0 remained in the accompanying interim unaudited condensed balance sheets as of September 30, 2018 and December 31, 2017, respectively. Costs relating to development activities conducted by the Company pursuant to SOW Three of $682,295 and $1,536,859 have been included in research and development expense in the accompanying interim unaudited condensed statements of operations for the three and nine months ended September 30, 2018, respectively. No costs or revenue relating to SOW Three were included in the accompanying interim unaudited condensed statements of operations for the three and nine months ended September 30, 2017 as SOW Three was not established until January 2018. QNAH Convertible Note Agreement In October 2017, the Company issued a subordinated convertible promissory note to QNAH in the principal amount of $3.0 million against receipt of cash proceeds equal to such principal amount. There have been no significant modifications or financial events relating to QNAH Convertible Note since disclosures made by the Company in its Annual Report on Form 10-K, filed with the SEC on March 23, 2018 other than the initiation of an escrow account relating to this note in July 2018 (see Note 17). The Company has recognized $29,150 and $39,240 of unamortized deferred financing costs incurred in connection with the issuance of the note under the QNAH Convertible Note in the accompanying interim unaudited condensed balance sheets as of September 30, 2018 and December 31, 2017, respectively. Amortization of the QNAH Convertible Note deferred financing costs was $3,363 and $10,090 for the three and nine months ended September 30, 2018, respectively. Interest accrued on the QNAH Convertible Note during the three and nine months ended September 30, 2018 was $22,685 and $67,315, respectively. Both amounts are included in interest expense in the accompanying interim unaudited statements of operations for the three and nine months ended September 30, 2018. There was no interest accrual or deferred financing cost amortization relating to the QNAH Convertible Note for the three and nine months ended September 30, 2017. |
Basis of Presentation and Sum_2
Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying interim unaudited condensed financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) and reflect the accounts of the Company as of September 30, 2018 and for the three and nine months ended September 30, 2018 and 2017. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles in the United States of America (“GAAP”) for complete financial statements. The accompanying interim unaudited condensed financial statements reflect all adjustments consisting of normal recurring adjustments which, in the opinion of management, are necessary for a fair statement of the Company’s financial position and the results of its operations and cash flows, as of and for the periods presented. The accompanying interim unaudited condensed balance sheet at December 31, 2017 has been derived from the audited financial statements at that date but does not include all of the information and disclosures required by GAAP for annual financial statements. The results of operations for the interim periods are not necessarily indicative of the results to be expected for the full year. These interim unaudited condensed financial statements should be read in conjunction with the Company’s audited financial statements and notes thereto for the fiscal year ended December 31, 2017, included in the Company’s Annual Report on Form 10-K filed with the SEC on March 23, 2018. |
Reclassifications | Reclassifications Certain prior year amounts have been reclassified for consistency with the current period presentation. These reclassifications had no effect on the reported results of operations. |
Revenue Recognition | Revenue Recognition The Company adopted the Financial Accounting Standards Board (“FASB”) new revenue standard, Accounting Standards Codification 606, Revenue from Contracts with Customers For contracts where the period between when the Company transfers a promised good or service to the customer and when the customer pays is one year or less, the Company has elected the practical expedient to not adjust the promised amount of consideration for the effects of a significant financing component. The Company has made a policy election to exclude from the measurement of the transaction price all taxes assessed by a government authority that are both imposed on and concurrent with a specific revenue producing transaction and collected by the Company from a customer. Such taxes may include but are not limited to sales, use, value added and certain excise taxes. |
Restricted Cash | Restricted Cash The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the accompanying interim unaudited condensed balance sheets that sum to the total of the same such amounts shown in the accompanying interim unaudited condensed statements of cash flows. September 30, 2018 Cash and cash equivalents $ 6,164,005 Restricted cash - non-current 3,270,247 Total cash, cash equivalents and restricted cash shown in the interim unaudited condensed statements of cash flows $ 9,434,252 Amounts included in restricted cash represent those required to be set aside in escrow under the terms of the MidCap Term Loan (see Note 8) to collateralize the payment that will be due upon maturity of the QNAH Convertible Note (see Note 16). The amounts will be released to the Company upon subsequent delivery of subordination documents for the QNAH Convertible Note to MidCap or conversion of the QNAH Convertible Note. If neither occurs, the amounts will be applied by the escrow agent to repay in full the QNAH Convertible Note at maturity (or in connection with a prepayment at the direction of the Company) subject to the terms of the MidCap Term Loan. |
Contract Assets | Contract Assets Contract assets represent the Company’s right to consideration in exchange for goods or services that the Company has transferred to a customer, for which rights to payment are conditional upon something other than the passage of time. |
Contract Liabilities | Contract Liabilities Contract liabilities represent cash receipts for products or services to be delivered in future periods, including up-front fees received relating to custom RUO assay design and sample processing services and collaboration development services. When products or services outputs are delivered to customers, contract liabilities are recognized as earned. Up-front fees received for custom RUO assay design or collaborative development services are recognized over time based on the costs incurred to date compared to total expected costs as design or development procedures are completed and outputs are produced. |
Product Warranty | Product Warranty The Company generally provides a one-year warranty on its HTG EdgeSeq systems covering the performance of system hardware and software in conformance with customer specifications under normal use and protecting against defects in materials and workmanship. The Company may, at its option, replace, repair or exchange products covered under valid warranty claims. This assurance-type warranty is not deemed to be a separate performance obligation under the Company’s contracts with customers for the sale of instruments, as its purpose is to ensure that the product complies with agreed-upon specifications following installation of the instrument. A provision for estimated warranty costs is recognized at the time of sale, through cost of revenue, based upon recent historical experience and other relevant information as it becomes available. The Company continuously assesses the adequacy of its product warranty accrual by reviewing actual claims and adjusts the provision as needed. |
Research and Development Expenses | Research and Development Expenses Research and development expenses represent costs incurred internally for research and development activities and costs incurred externally to fund research activities. The costs include those generated through research and development efforts for the improvement and expansion of the Company’s proprietary technology and product offerings as well as those related to third-party collaborative development agreements, for which related revenue is included in collaborative development services revenue in the accompanying interim unaudited condensed statements of operations. See Note 16 for further discussion of the development costs associated with collaborative development services agreements included in research and development expense as compared to cost of revenue in the accompanying interim unaudited condensed statements of operations. |
Debt Issuance Costs | Debt Issuance Costs Costs incurred to issue non-revolving debt instruments are recognized as a reduction to the related debt balance in the accompanying interim unaudited condensed balance sheets and amortized to interest expense over the contractual term of the related debt using the effective interest method. Costs incurred to issue revolving debt instruments are deferred as an asset in the accompanying interim unaudited condensed balance sheets and amortized on a straight-line basis to interest expense over the term of the revolving commitment. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. The Company’s significant estimates include revenue recognition, stock-based compensation expense, bonus accrual, income tax valuation allowances, recovery of long-lived assets, warranty accrual, inventory obsolescence and inventory valuation. Actual results could materially differ from those estimates. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The carrying value of financial instruments classified as current assets and current liabilities approximate fair value due to their liquidity and short-term nature. Investments that are classified as available-for-sale are recorded at fair value, which was determined using quoted market prices, broker or dealer quotations or alternative pricing sources with reasonable levels of price transparency. In October 2017, the Company received $3.0 million in gross proceeds from, and issued a subordinated convertible promissory note (the “QNAH Convertible Note”) in that principal amount to, QIAGEN North American Holdings, Inc. (“QNAH”). As of September 30, 2018, the estimated aggregate fair value of the QNAH Convertible Note is approximately $4.1 million. The fair value estimate is based on the note’s discounted cash flows and estimated option value of the conversion terms. The estimated fair value of the QNAH Convertible Note represents a Level 3 measurement. The fair value of the MidCap Term Loan (see Note 8) is also estimated using Level 3 inputs and approximates fair value as the interest rate approximates the market rate for debt securities with similar terms and risk characteristics. The NuvoGen obligation is an obligation relating to an asset purchase transaction with a then-common stockholder of the Company. Although the obligation is considered a financial instrument, the Company is unable to reasonably determine its fair value as the remaining payments due under the obligation will be made at the greater of a minimum fixed quarterly payment or 6% of revenue, causing variability in the timing and amount of payments and the term of the obligation. |
Concentration Risks | Concentration Risks Financial instruments that potentially subject the Company to credit risk consist principally of cash and cash equivalents, available-for-sale debt securities and uncollateralized accounts receivable. The Company maintains the majority of its cash balances in the form of cash deposits in bank checking and money market accounts in amounts in excess of federally insured limits. Management believes, based upon the quality of the financial institution, that the credit risk with regard to these deposits is not significant. The Company sells its instrument, related consumables, sample processing services, custom RUO assay design and collaborative development services primarily to biopharmaceutical companies, academic institutions and molecular labs. The Company routinely assesses the financial strength of its customers and credit losses have been minimal to date. The Company’s top two customers accounted for 72% and 10% of the Company’s total revenue for the three months ended September 30, 2018, compared with 57% and 10% for the three months ended September 30, 2017. The top two customers accounted for 63% and 10% of the Company’s total revenue for the nine months ended September 30, 2018, compared to 35% and 13% for the nine months ended September 30, 2017. The top two customers accounted for approximately 75% and 8% of the Company’s accounts receivable as of September 30, 2018, compared with approximately 66% and 11% as of December 31, 2017. The largest of these amounts represents accounts receivable relating to statements of work entered into under the Company’s Governing Agreement with QML. The Company currently relies on a single supplier to supply a subcomponent used in the HTG EdgeSeq processors. A loss of this supplier could significantly delay the delivery of processors, which in turn would materially affect the Company’s ability to generate revenue. |
Recently Adopted and New Accounting Pronouncements | Recently Adopted Accounting Pronouncements In May 2014, the FASB issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers In March 2016, the FASB issued ASU No. 2016-08, Revenue Recognition: Clarifying the new Revenue Standard’s Principal-Versus-Agent Guidance In April 2016, the FASB issued ASU No. 2016-10, Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing In May 2016, the FASB issued ASU No. 2016-12, Revenue from Contracts with Customers (Topic 606): Narrow Scope Improvements and Practical Expedients. The new revenue standard and the standards that amend it were effective for public entities for fiscal years and interim periods within those fiscal years beginning after December 15, 2017, using either of the following transition methods: (i) a full retrospective approach reflecting the application of the standard in each prior reporting period with the option to elect certain practical expedients, or (ii) a retrospective approach with the cumulative effect of initially adopting ASU 2014-09 recognized at the date of adoption (which includes additional footnote disclosures). The Company adopted ASC 606 as of January 1, 2018 using the full retrospective approach. The adoption of ASC 606 did not have a material impact on 2017 revenue recognition or on opening equity, as the timing and measurement of revenue recognition is materially the same for the Company as under ASC 605. The Company has presented additional quantitative and qualitative disclosures regarding identified revenue streams and performance obligations beginning with the first quarter ended March 31, 2018 (see Note 9 and Note 16). The Company has also identified and implemented changes to its business processes and internal controls relating to implementation of the new standard. In January 2016, the FASB issued ASU No. 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities, In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments, In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash In May 2017, the FASB issued ASU No. 2017-09, Compensation – Stock Compensation (Topic 718): Scope of Modification Accounting New Accounting Pronouncements The following are new FASB ASUs that have not been adopted by the Company as of September 30, 2018, grouped by their respective effective dates: January 1, 2019 In February 2016, the FASB issued ASU No. 2016-02, Leases, which was subsequently amended by ASU No. 2018-01, ASU No. 2018-10 and ASU NO. 2018-11 In July 2017, the FASB issued ASU 2017-11, Accounting for Certain Financial Instruments with Down Round Features In June 2018, the FASB issued ASU No. 2018-07, Compensation – Stock Compensation (Topic 718): Improvements to Nonemployee Share-based Payment Accounting January 1, 2020 In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement – Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement In November 2018, the FASB issued ASU No. 2018-18, which amended ASC 808, Collaborative Arrangements Revenue from Contracts with Customers |
Basis of Presentation and Sum_3
Basis of Presentation and Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
Summary of Reconciliation of Cash, Cash Equivalents and Restricted Cash | The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the accompanying interim unaudited condensed balance sheets that sum to the total of the same such amounts shown in the accompanying interim unaudited condensed statements of cash flows. September 30, 2018 Cash and cash equivalents $ 6,164,005 Restricted cash - non-current 3,270,247 Total cash, cash equivalents and restricted cash shown in the interim unaudited condensed statements of cash flows $ 9,434,252 |
Inventory (Tables)
Inventory (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | Inventory, net of allowance, consisted of the following as of the dates indicated: September 30, December 31, 2018 2017 Raw materials $ 843,973 $ 984,328 Work in process 152,458 66,314 Finished goods 172,064 192,021 Total gross inventory 1,168,495 1,242,663 Less inventory allowance (39,403 ) (62,142 ) $ 1,129,092 $ 1,180,521 |
Fair Value Instruments (Tables)
Fair Value Instruments (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Financial Assets and Liabilities Measured at Fair Value on Recurring Basis | The following table classifies the Company’s financial assets and liabilities measured at fair value on a recurring basis at September 30, 2018 and December 31, 2017, respectively: Balance at September 30, 2018 Level 1 Level 2 Level 3 Total Asset included in: Cash and cash equivalents Money market securities $ 6,105,380 $ — $ — $ 6,105,380 Investments available-for-sale at fair value U.S. government obligations 9,995,100 — — 9,995,100 Corporate debt securities — 17,617,931 — 17,617,931 Total $ 16,100,480 $ 17,617,931 $ — $ 33,718,411 Balance at December 31, 2017 Level 1 Level 2 Level 3 Total Asset included in: Cash and cash equivalents Money market securities $ 8,521,054 $ — $ — $ 8,521,054 Total $ 8,521,054 $ — $ — $ 8,521,054 |
Available-for-Sale Securities (
Available-for-Sale Securities (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Investments Debt And Equity Securities [Abstract] | |
Summary of Available-for-sale Securities | The Company’s portfolio of available-for-sale securities consists of U.S. Treasuries and high credit quality corporate debt securities. The following is a summary of the Company’s available-for-sale securities at September 30, 2018: September 30, 2018 Gross Gross Fair Value Amortized Unrealized Unrealized (Net Carrying Cost Gains Losses Amount) U.S. Treasury securities $ 10,002,727 $ — $ (7,627 ) $ 9,995,100 Corporate debt securities 17,619,186 — (1,255 ) 17,617,931 Total available-for-sale securities $ 27,621,913 $ — $ (8,882 ) $ 27,613,031 |
Summary of Contractual Maturities of Debt Investment Securities | Contractual maturities of debt investment securities at September 30, 2018 are shown below. Under 1 Year 1 to 2 Years Total U.S. Treasury securities $ 9,995,100 $ — $ 9,995,100 Corporate debt securities 17,617,931 — 17,617,931 Total available-for-sale securities $ 27,613,031 $ — $ 27,613,031 |
Summary of Debt Securities with Unrealized Losses | The following table shows the gross unrealized losses and fair values of the Company’s investments that have unrealized losses, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position as of September 30, 2018: Under 1 Year 1 to 2 Years Total Gross Gross Gross Fair Unrealized Fair Unrealized Fair Unrealized Value Losses Value Losses Value Losses U.S. Treasury securities $ 9,995,100 $ (7,627 ) $ — $ — $ 9,995,100 $ (7,627 ) Corporate debt securities 2,399,726 (1,255 ) — — 2,399,726 (1,255 ) Total available-for-sale securities with unrealized losses $ 12,394,826 $ (8,882 ) $ — $ — $ 12,394,826 $ (8,882 ) |
Property and Equipment (Tables)
Property and Equipment (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Property Plant And Equipment [Abstract] | |
Summary of Property and Equipment | Property and equipment, net, consists of the following as of the dates indicated: September 30, December 31, 2018 2017 Furniture & fixtures $ 771,767 $ 582,007 Leasehold improvements 1,895,216 1,863,698 Equipment used in manufacturing 2,176,188 1,963,558 Equipment used in research & development 1,456,954 1,328,556 Equipment used in the field 130,552 130,552 Software 373,683 373,683 Construction in progress 117,447 255,641 6,921,807 6,497,695 Less: accumulated depreciation and amortization (4,307,187 ) (3,192,805 ) $ 2,614,620 $ 3,304,890 |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Accrued Liabilities Current [Abstract] | |
Summary of Accrued Liabilities | Accrued liabilities consist of the following as of the dates indicated: September 30, December 31, 2018 2017 Accrued employee bonuses $ 1,407,730 $ 3,049,109 Payroll and employee benefit accruals 607,580 369,275 Accrued professional fees 130,190 101,150 Accrued interest 130,509 45,544 Other accrued liabilities 254,606 181,708 $ 2,530,615 $ 3,746,786 |
Revenue from Contracts with C_2
Revenue from Contracts with Customers (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Revenue From Contract With Customer [Abstract] | |
Product and Product-Related Service Revenue from Sale of Instruments and Consumables | Product and Product-related Services Revenue The Company had product and product-related services revenue consisting of revenue from the sale of instruments and consumables and the use of the HTG EdgeSeq proprietary technology to process samples and design custom RUO assays for the three and nine months ended September 30, 2018 and 2017 as follows: Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Product revenue: Instruments $ 24,844 $ 199,205 $ 309,711 $ 370,263 Consumables 427,899 426,400 1,273,011 1,203,663 Total product revenue 452,743 625,605 1,582,722 1,573,926 Product-related services revenue: Custom RUO assay development 262,044 73,567 565,768 419,515 Sample processing 600,057 893,618 2,923,212 2,428,863 Total product-related services revenue 862,101 967,185 3,488,980 2,848,378 Total product and product-related services revenue $ 1,314,844 $ 1,592,790 $ 5,071,702 $ 4,422,304 |
Schedule of Collaborative Development Services | Collaborative Development Services Revenue Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Collaborative development services $ 3,391,534 $ 2,130,694 $ 8,704,094 $ 2,433,105 |
Schedule of Changes in Contract Liability | Changes in the Company’s contract liability were as follows as of the date indicated: Product Revenue Custom RUO Assay Design Sample Processing Collaborative Development Services Total Contract Liability Balance at January 1, 2018 $ 39,426 $ 197,606 $ 490,536 $ 110,317 $ 837,885 Deferral of revenue 151,461 336,080 166,291 70,918 724,750 Recognition of deferred revenue (135,980 ) (453,768 ) (403,677 ) (181,235 ) (1,174,660 ) Balance at September 30, 2018 $ 54,907 $ 79,918 $ 253,150 $ — $ 387,975 |
Other Agreements (Tables)
Other Agreements (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Other Agreements [Abstract] | |
Schedule of Remaining Minimum Principal Payments Due | The minimum remaining payments due to NuvoGen at September 30, 2018, including $182,383 of additional revenue-based payments payable as of September 30, 2018, are as follows for each fiscal year, although actual payments could be significantly more than provided in the table, to the extent that 6% of the Company’s annual revenue exceeds $400,000: 2018 $ 282,383 2019 400,000 2020 400,000 2021 400,000 2022 400,000 2023 and beyond 5,286,621 Total NuvoGen obligation payments 7,169,004 Plus interest accretion 109,487 Total NuvoGen obligation, net $ 7,278,491 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Earnings Per Share [Abstract] | |
Numerator and Denominator Used in Computing Basic and Diluted Net Loss per Share | The following table provides the numerator and denominator used in computing basic and diluted net loss per share for the periods indicated: Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Numerator: Net loss $ (4,843,408 ) $ (5,380,846 ) $ (14,326,084 ) $ (17,038,022 ) Denominator: Weighted-average shares outstanding-basic and diluted 28,434,406 11,603,617 27,184,968 9,794,651 Net loss per share, basic and diluted $ (0.17 ) $ (0.46 ) $ (0.53 ) $ (1.74 ) |
Outstanding Securities Excluded from Computation of Diluted Net Loss per Share | The following outstanding securities were excluded from the computation of diluted net loss per share for the periods presented because their effect would have been anti-dilutive: Nine Months Ended September 30, 2018 2017 Options to purchase common stock 2,148,323 1,532,979 Common stock warrants 237,846 219,723 Restricted stock units 249,166 34,999 QNAH convertible note 772,075 — |
Warrants (Tables)
Warrants (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Proceeds From Issuance Of Preferred Stock Preference Stock And Warrants [Abstract] | |
Summary of Outstanding Warrants | The following table shows the common stock warrants outstanding as of September 30, 2018: Shares of Common Exercise Price/Share Expiration Date 28,713 $ 23.51 2024 144,772 14.00 2022 931 6.45 2019 45,307 2.76 2026 18,123 7.73 2028 |
Stockholders Deficit (Tables)
Stockholders Deficit (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Equity [Abstract] | |
Summary of Stock Option Plans Activity | A summary of the Company’s stock option activity for the nine months ended September 30, 2018 is as follows: Number of Shares Weighted- Average Exercise Price Per Share Weighted- Average Remaining Contractual Life (Years) Aggregate Intrinsic Value Balance at December 31, 2017 1,517,771 $ 2.97 7.5 $ 67,242 Granted 802,500 3.39 Exercised (96,164 ) 2.12 $ 182,678 Forfeited (35,679 ) 3.42 Expired/Cancelled (40,105 ) 6.81 Balance at September 30, 2018 2,148,323 $ 3.08 7.8 $ 4,624,110 Exercisable at September 30, 2018 1,258,202 $ 2.93 6.5 $ 3,065,442 |
Summary of Restricted Stock Unit (“RSU”) Plans Activity | A summary of restricted stock unit (“RSU”) activity for the nine months ended September 30, 2018 is as follows: Number of Shares Weighted- Average Grant Date Fair Value Per Share Balance at December 31, 2017 26,666 $ 2.78 Granted 492,051 3.63 Released (269,551 ) 3.76 Balance at September 30, 2018 249,166 $ 3.39 Vested and unissued at September 30, 2018 13,126 $ 3.40 |
Summary of Stock-Based Compensation | Stock-based compensation expense recorded in the accompanying interim unaudited condensed statements of operations for the three and nine months ended September 30, 2018 and 2017 was as follows: Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Selling, general and administrative $ 200,317 $ 251,924 $ 1,475,975 $ 826,098 Research and development 41,553 79,619 121,651 261,083 Cost of revenue 16,105 25,862 45,727 84,807 $ 257,975 $ 357,405 $ 1,643,353 $ 1,171,988 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Commitments And Contingencies Disclosure [Abstract] | |
Minimum Real Estate Lease Payments Before Common Area Maintenance Charges | The Company’s remaining minimum real estate lease payments before common area maintenance charges for each fiscal year as of September 30, 2018 are as follows: 2018 $ 127,983 2019 514,977 2020 517,457 2021 43,139 $ 1,203,556 |
Summary of Product Warranty Reserve | The following is a summary of the Company’s general product warranty reserve for the periods indicated: Nine Months Ended September 30, 2018 2017 Beginning balance $ 37,156 $ 50,426 Cost of warranty claims (2,484 ) (6,278 ) Increase in warranty reserve 20,496 3,275 Ending balance $ 55,168 $ 47,423 |
Description of Business - Addit
Description of Business - Additional Information (Details) - Segment | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Significant Accounting Policies [Line Items] | ||||
Number of operating segments | 1 | |||
Sales Revenue, Net | Customer Concentration Risk | Customers Located Outside Of United States | ||||
Significant Accounting Policies [Line Items] | ||||
Sales revenue percentage | 79.00% | 68.00% | 77.00% | 49.00% |
Sales Revenue, Net | Customer Concentration Risk | Customers Located Outside Of United States | QIAGEN Manchester Limited | ||||
Significant Accounting Policies [Line Items] | ||||
Sales revenue percentage | 92.00% | 85.00% | 82.00% | 72.00% |
Basis of Presentation and Sum_4
Basis of Presentation and Summary of Significant Accounting Policies - Additional Information (Details) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Oct. 31, 2017USD ($) | Sep. 30, 2018USD ($)Customer | Sep. 30, 2017Customer | Sep. 30, 2018USD ($)Customer | Sep. 30, 2017Customer | Dec. 31, 2017Customer | |
Significant Accounting Policies [Line Items] | ||||||
Prior period reclassification adjustment | $ 0 | |||||
Accounting Standards Update 2016-02 | Maximum | Office and Equipment Leases | ||||||
Significant Accounting Policies [Line Items] | ||||||
Gross-up amount of leases effect in balance sheets | $ 2,000,000 | |||||
Sales Revenue, Net | Customer Concentration Risk | ||||||
Significant Accounting Policies [Line Items] | ||||||
Number of customers | Customer | 2 | 2 | 2 | 2 | ||
Sales Revenue, Net | Customer Concentration Risk | Customer One | ||||||
Significant Accounting Policies [Line Items] | ||||||
Sales revenue percentage | 72.00% | 57.00% | 63.00% | 35.00% | ||
Sales Revenue, Net | Customer Concentration Risk | Customer Two | ||||||
Significant Accounting Policies [Line Items] | ||||||
Sales revenue percentage | 10.00% | 10.00% | 10.00% | 13.00% | ||
Accounts Receivable | Customer Concentration Risk | ||||||
Significant Accounting Policies [Line Items] | ||||||
Number of customers | Customer | 2 | 2 | ||||
Accounts Receivable | Customer Concentration Risk | Customer One | ||||||
Significant Accounting Policies [Line Items] | ||||||
Sales revenue percentage | 75.00% | 66.00% | ||||
Accounts Receivable | Customer Concentration Risk | Customer Two | ||||||
Significant Accounting Policies [Line Items] | ||||||
Sales revenue percentage | 8.00% | 11.00% | ||||
NuvoGen Asset Purchase Agreement | ||||||
Significant Accounting Policies [Line Items] | ||||||
Percentage of revenue for remaining payment due under obligation | 6.00% | |||||
QIAGEN North American Holdings, Inc. | ||||||
Significant Accounting Policies [Line Items] | ||||||
Convertible debt, fair value | $ 4,100,000 | $ 4,100,000 | ||||
QIAGEN North American Holdings, Inc. | Convertible Promissory Note | ||||||
Significant Accounting Policies [Line Items] | ||||||
Gross proceeds from issuance of subordinated notes | $ 3,000,000 |
Basis of Presentation and Sum_5
Basis of Presentation and Summary of Significant Accounting Policies - Summary of Reconciliation of Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) | Sep. 30, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Dec. 31, 2016 |
Accounting Policies [Abstract] | ||||
Cash and cash equivalents | $ 6,164,005 | $ 9,968,600 | ||
Restricted cash - non-current | 3,270,247 | |||
Total cash, cash equivalents and restricted cash shown in the interim unaudited condensed statements of cash flows | $ 9,434,252 | $ 9,968,600 | $ 9,047,401 | $ 7,507,659 |
Inventory - Schedule of Invento
Inventory - Schedule of Inventory (Details) - USD ($) | Sep. 30, 2018 | Dec. 31, 2017 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 843,973 | $ 984,328 |
Work in process | 152,458 | 66,314 |
Finished goods | 172,064 | 192,021 |
Total gross inventory | 1,168,495 | 1,242,663 |
Less inventory allowance | (39,403) | (62,142) |
Inventory, net | $ 1,129,092 | $ 1,180,521 |
Inventory - Additional Informat
Inventory - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
Inventory Disclosure [Abstract] | |||||
Reserve for shrinkage and excess inventory | $ 39,403 | $ 62,142 | |||
Net change in inventory valuation reserves | $ (22,926) | $ (21,405) | (22,739) | $ (83,832) | |
Provision for excess inventory | $ 40,307 | $ 58,059 | $ 63,840 | $ 302,085 |
Fair Value Instruments - Financ
Fair Value Instruments - Financial Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) - Fair Value, Measurements, Recurring - USD ($) | Sep. 30, 2018 | Dec. 31, 2017 |
Asset included in: | ||
Financial Assets | $ 33,718,411 | $ 8,521,054 |
Cash and Cash Equivalents | Money Market Securities | ||
Asset included in: | ||
Financial Assets | 6,105,380 | 8,521,054 |
Investments Available-for-sale at Fair Value | U.S. Government Obligations | ||
Asset included in: | ||
Financial Assets | 9,995,100 | |
Investments Available-for-sale at Fair Value | Corporate Debt Securities | ||
Asset included in: | ||
Financial Assets | 17,617,931 | |
Level 1 | ||
Asset included in: | ||
Financial Assets | 16,100,480 | 8,521,054 |
Level 1 | Cash and Cash Equivalents | Money Market Securities | ||
Asset included in: | ||
Financial Assets | 6,105,380 | $ 8,521,054 |
Level 1 | Investments Available-for-sale at Fair Value | U.S. Government Obligations | ||
Asset included in: | ||
Financial Assets | 9,995,100 | |
Level 2 | ||
Asset included in: | ||
Financial Assets | 17,617,931 | |
Level 2 | Investments Available-for-sale at Fair Value | Corporate Debt Securities | ||
Asset included in: | ||
Financial Assets | $ 17,617,931 |
Fair Value Instruments - Additi
Fair Value Instruments - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended |
Sep. 30, 2018 | Sep. 30, 2018 | Dec. 31, 2017 | |
Fair Value Disclosures [Abstract] | |||
Fair value assets, Level 1 to Level 2 transfers, Amount | $ 0 | $ 0 | $ 0 |
Fair value, assets, Level 2 to Level 1 transfers, Amount | 0 | 0 | 0 |
Fair value, liabilities, Level 1 to Level 2 transfers, Amount | 0 | 0 | 0 |
Fair value, liabilities, Level 2 to Level 1 transfers, Amount | 0 | 0 | 0 |
Fair value, measurement with unobservable inputs reconciliation, recurring basis, asset transfers into Level 3 | 0 | 0 | 0 |
Fair value, measurement with unobservable inputs reconciliation, recurring Basis, asset, transfers out of Level 3 | 0 | 0 | 0 |
Fair Value, measurement with unobservable inputs reconciliation, liability, transfers into Level 3 | 0 | 0 | 0 |
Fair Value, measurement with unobservable inputs reconciliation, liability, transfers out of Level 3 | $ 0 | $ 0 | $ 0 |
Available-for-Sale Securities -
Available-for-Sale Securities - Summary of Available-for-sale Securities (Details) - USD ($) | Sep. 30, 2018 | Dec. 31, 2017 |
Schedule Of Available For Sale Securities [Line Items] | ||
Amortized Cost | $ 27,621,913 | |
Gross Unrealized Losses | (8,882) | |
Fair Value (Net Carrying Amount) | 27,613,031 | $ 0 |
U.S. Treasury Securities | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Amortized Cost | 10,002,727 | |
Gross Unrealized Losses | (7,627) | |
Fair Value (Net Carrying Amount) | 9,995,100 | |
Corporate Debt Securities | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Amortized Cost | 17,619,186 | |
Gross Unrealized Losses | (1,255) | |
Fair Value (Net Carrying Amount) | $ 17,617,931 |
Available-for-Sale Securities_2
Available-for-Sale Securities - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
Investments Debt And Equity Securities [Abstract] | |||||
Available for sale securities | $ 27,613,031 | $ 27,613,031 | $ 0 | ||
Unrealized gain on short and long-term investments | $ 2,457 | $ 0 | (8,882) | $ 1,090 | |
Available-For-Sale Securities | |||||
Schedule Of Available For Sale Securities [Line Items] | |||||
Other-than-temporary impairment | $ 0 | $ 0 |
Available-for-Sale Securities_3
Available-for-Sale Securities - Summary of Contractual Maturities of Debt Investment Securities (Details) - USD ($) | Sep. 30, 2018 | Dec. 31, 2017 |
Schedule Of Available For Sale Securities [Line Items] | ||
Under 1 Year | $ 27,613,031 | |
Fair Value (Net Carrying Amount) | 27,613,031 | $ 0 |
U.S. Treasury Securities | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Under 1 Year | 9,995,100 | |
Fair Value (Net Carrying Amount) | 9,995,100 | |
Corporate Debt Securities | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Under 1 Year | 17,617,931 | |
Fair Value (Net Carrying Amount) | $ 17,617,931 |
Available-for-Sale Securities_4
Available-for-Sale Securities - Summary of Debt Securities with Unrealized Losses (Details) | Sep. 30, 2018USD ($) |
Schedule Of Available For Sale Securities [Line Items] | |
Under 1 Year, Fair Value | $ 12,394,826 |
Under 1 Year, Gross Unrealized Losses | (8,882) |
Total, Fair Value | 12,394,826 |
Total, Gross Unrealized Losses | (8,882) |
U.S. Treasury Securities | |
Schedule Of Available For Sale Securities [Line Items] | |
Under 1 Year, Fair Value | 9,995,100 |
Under 1 Year, Gross Unrealized Losses | (7,627) |
Total, Fair Value | 9,995,100 |
Total, Gross Unrealized Losses | (7,627) |
Corporate Debt Securities | |
Schedule Of Available For Sale Securities [Line Items] | |
Under 1 Year, Fair Value | 2,399,726 |
Under 1 Year, Gross Unrealized Losses | (1,255) |
Total, Fair Value | 2,399,726 |
Total, Gross Unrealized Losses | $ (1,255) |
Summary Of Property and Equipme
Summary Of Property and Equipment (Details) - USD ($) | Sep. 30, 2018 | Dec. 31, 2017 |
Property Plant And Equipment [Abstract] | ||
Furniture & fixtures | $ 771,767 | $ 582,007 |
Leasehold improvements | 1,895,216 | 1,863,698 |
Equipment used in manufacturing | 2,176,188 | 1,963,558 |
Equipment used in research & development | 1,456,954 | 1,328,556 |
Equipment used in the field | 130,552 | 130,552 |
Software | 373,683 | 373,683 |
Construction in progress | 117,447 | 255,641 |
Total property and equipment, gross | 6,921,807 | 6,497,695 |
Less: accumulated depreciation and amortization | (4,307,187) | (3,192,805) |
Property and equipment, net | $ 2,614,620 | $ 3,304,890 |
Property and Equipment - Additi
Property and Equipment - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Property Plant And Equipment [Abstract] | ||||
Depreciation and leasehold improvement amortization expense | $ 347,886 | $ 305,868 | $ 1,126,230 | $ 893,334 |
Summary of Accrued Liabilities
Summary of Accrued Liabilities (Details) - USD ($) | Sep. 30, 2018 | Dec. 31, 2017 |
Payables And Accruals [Abstract] | ||
Accrued employee bonuses | $ 1,407,730 | $ 3,049,109 |
Payroll and employee benefit accruals | 607,580 | 369,275 |
Accrued professional fees | 130,190 | 101,150 |
Accrued interest | 130,509 | 45,544 |
Other accrued liabilities | 254,606 | 181,708 |
Total accrued liabilities | $ 2,530,615 | $ 3,746,786 |
Debt Obligations - Additional I
Debt Obligations - Additional Information (Details) - USD ($) | Mar. 26, 2018 | Mar. 31, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | Jul. 11, 2018 |
Debt Instrument [Line Items] | ||||||||
Accretion of discount on NuvoGen obligation | $ (9,125) | $ 147,753 | ||||||
Repayment of outstanding principal and interest | 4,276,988 | |||||||
Loss on extinguishment of Growth Term Loan | 105,064 | |||||||
Warrants to purchase common stock, shares | 18,123 | |||||||
Warrants exercise price | $ 7.73 | |||||||
Revolving loan cost | $ 71,126 | 71,126 | ||||||
MidCap Credit Facility | ||||||||
Debt Instrument [Line Items] | ||||||||
Accretion of discount on NuvoGen obligation | 39,910 | $ 83,766 | ||||||
Credit facility aggregate principal amount | $ 20,000,000 | |||||||
Line of credit facility interest rate at the end of the period | 9.34% | |||||||
Line of credit facility, expiration period | 36 months | |||||||
Line of credit facility first anniversary early termination fee percentage | 3.00% | |||||||
Line of credit facility second anniversary early termination fee percentage | 2.00% | |||||||
Line of credit facility third anniversary early termination fee percentage | 1.00% | |||||||
Origination fee | $ 100,000 | |||||||
Line of credit facility termination fee | 4.50% | |||||||
Amount required to deposit in escrow account | $ 3,300,000 | |||||||
Escrow deposit | $ 3,300,000 | |||||||
Minimum amount in deposit account subject to control agreement | $ 20,000,000 | |||||||
Credit facility, covenant terms | Commencing with the calendar quarter ending on the later of (a) June 30, 2019 and (b) the last day of the calendar quarter in which MidCap Tranche 2 is funded, the Company must also comply with a financial covenant relating to trailing twelve-month minimum Net Revenue requirements (as defined in the MidCap Credit Facility), tested on a quarterly basis | |||||||
Credit Facility increase in interest on obligation percentage | 3.00% | |||||||
Percentage of weighted average closing price | 150.00% | |||||||
Fair value of warrants | $ 74,000 | |||||||
Debt discount | 648,204 | $ 648,204 | ||||||
MidCap Credit Facility | MidCap Tranche 1 | ||||||||
Debt Instrument [Line Items] | ||||||||
Credit facility aggregate principal amount | $ 7,000,000 | |||||||
Line of credit facility interest rate | 7.25% | |||||||
Credit facility, basis spread on variable rate | 1.25% | |||||||
Credit facility, basis spread on variable rate description | one-month LIBOR | |||||||
Warrants to purchase of common stock expiration year | 10 years | |||||||
Warrants to purchase common stock, shares | 18,123 | |||||||
Warrants exercise price | $ 7.73 | |||||||
MidCap Credit Facility | MidCap Tranche 2 | ||||||||
Debt Instrument [Line Items] | ||||||||
Credit facility aggregate principal amount | $ 13,000,000 | |||||||
Line of credit facility interest rate | 7.25% | |||||||
Credit facility, basis spread on variable rate | 1.25% | |||||||
Credit facility, basis spread on variable rate description | one-month LIBOR | |||||||
Warrants to purchase of common stock expiration year | 10 years | |||||||
Percentage of warrants to purchase common stock | 2.00% | |||||||
Revolving Credit Facility | ||||||||
Debt Instrument [Line Items] | ||||||||
Amortization of deferred financing costs | 4,058 | 8,294 | ||||||
Credit facility aggregate principal amount | $ 2,000,000 | |||||||
Line of credit facility interest rate | 4.25% | |||||||
Credit facility, basis spread on variable rate | 1.25% | |||||||
Credit facility, basis spread on variable rate description | one-month LIBOR | |||||||
Line of credit facility first anniversary early termination fee percentage | 3.00% | |||||||
Line of credit facility second anniversary early termination fee percentage | 2.00% | |||||||
Line of credit facility third anniversary early termination fee percentage | 1.00% | |||||||
Credit facility outstanding amount | 0 | 0 | ||||||
Credit facility origination fee percentage | 0.50% | |||||||
Credit facility, unused line fee percentage | 0.50% | |||||||
Credit facility collateral management fee percentage | 0.50% | |||||||
Credit facility minimum drawn balance percentage | 20.00% | |||||||
Revolving loan cost | 71,126 | 71,126 | ||||||
Revolving Credit Facility | Maximum | ||||||||
Debt Instrument [Line Items] | ||||||||
Credit facility additional borrowing capacity | $ 8,000,000 | |||||||
Growth Term Loan | ||||||||
Debt Instrument [Line Items] | ||||||||
Accretion of discount on NuvoGen obligation | 0 | $ 58,538 | ||||||
Amortization of deferred financing costs | 0 | $ 4,362 | 2,982 | 14,950 | ||||
Repayment of outstanding principal and interest | $ 4,300,000 | |||||||
Loss on extinguishment of Growth Term Loan | 0 | 105,064 | ||||||
Unamortized discounts | 67,272 | 67,272 | ||||||
Growth Term Loan | Oxford Finance, LLC and Silicon Valley Bank | ||||||||
Debt Instrument [Line Items] | ||||||||
Accretion of discount on NuvoGen obligation | $ 0 | $ 89,836 | $ 59,969 | $ 310,567 |
Revenue from Contracts with C_3
Revenue from Contracts with Customers - Product and Product-Related Service Revenue from Sale of Instruments and Consumables (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Disaggregation Of Revenue [Line Items] | ||||
Product and product-related services revenue | $ 4,706,378 | $ 3,723,484 | $ 13,775,796 | $ 6,855,409 |
Product and Product-related Services | ||||
Disaggregation Of Revenue [Line Items] | ||||
Product and product-related services revenue | 1,314,844 | 1,592,790 | 5,071,702 | 4,422,304 |
HTG EdgeSeq | Instrument | ||||
Disaggregation Of Revenue [Line Items] | ||||
Product and product-related services revenue | 24,844 | 199,205 | 309,711 | 370,263 |
HTG EdgeSeq | Consumables | ||||
Disaggregation Of Revenue [Line Items] | ||||
Product and product-related services revenue | 427,899 | 426,400 | 1,273,011 | 1,203,663 |
HTG EdgeSeq | Product revenue | ||||
Disaggregation Of Revenue [Line Items] | ||||
Product and product-related services revenue | 452,743 | 625,605 | 1,582,722 | 1,573,926 |
HTG EdgeSeq | Custom RUO assay design | ||||
Disaggregation Of Revenue [Line Items] | ||||
Product and product-related services revenue | 262,044 | 73,567 | 565,768 | 419,515 |
HTG EdgeSeq | Sample processing | ||||
Disaggregation Of Revenue [Line Items] | ||||
Product and product-related services revenue | 600,057 | 893,618 | 2,923,212 | 2,428,863 |
HTG EdgeSeq | Product-related services revenue | ||||
Disaggregation Of Revenue [Line Items] | ||||
Product and product-related services revenue | 862,101 | 967,185 | 3,488,980 | 2,848,378 |
HTG EdgeSeq | Product and Product-related Services | ||||
Disaggregation Of Revenue [Line Items] | ||||
Product and product-related services revenue | $ 1,314,844 | $ 1,592,790 | $ 5,071,702 | $ 4,422,304 |
Revenue from Contracts with C_4
Revenue from Contracts with Customers - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
Disaggregation Of Revenue [Line Items] | |||||
Agreements for product and product-related services revenue | 1 year | 1 year | |||
Agreements for product and product-related services revenue, description | The Company’s agreements for product and product-related services revenue have an expected duration of one year or less | ||||
Revenue | $ 4,706,378 | $ 3,723,484 | $ 13,775,796 | $ 6,855,409 | |
Contract liabilities | 387,975 | 387,975 | $ 837,885 | ||
Cumulative catch up adjustment | 0 | 30,055 | |||
Collaborative Development Services | |||||
Disaggregation Of Revenue [Line Items] | |||||
Revenue | 3,391,534 | 2,130,694 | $ 8,704,094 | 2,433,105 | |
Contract liabilities | 110,317 | ||||
Bristol Myers Squibb | |||||
Disaggregation Of Revenue [Line Items] | |||||
Agreement expiration date | May 11, 2019 | ||||
Number of days material breach remains uncured | 60 days | ||||
Agreement termination notice period | 90 days | ||||
Revenue | 166,714 | 31,250 | $ 298,938 | 93,750 | |
Contract liabilities | 79,918 | 79,918 | $ 160,106 | ||
Partially unsatisfied performance obligation aggregate amount | 50,000 | 50,000 | |||
Merck KGaA Agreement | Collaborative Development Services | |||||
Disaggregation Of Revenue [Line Items] | |||||
Revenue | $ 0 | 0 | $ 0 | 25,000 | |
Additional milestone payment earned | $ 0 | $ 0 | |||
Minimum | |||||
Disaggregation Of Revenue [Line Items] | |||||
Customer payment term | 30 days | ||||
Maximum | |||||
Disaggregation Of Revenue [Line Items] | |||||
Customer payment term | 90 days |
Revenue from Contract with Cust
Revenue from Contract with Customer - Schedule of Collaborative Development Services (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Disaggregation Of Revenue [Line Items] | ||||
Service revenue | $ 4,706,378 | $ 3,723,484 | $ 13,775,796 | $ 6,855,409 |
Collaborative Development Services | ||||
Disaggregation Of Revenue [Line Items] | ||||
Service revenue | $ 3,391,534 | $ 2,130,694 | $ 8,704,094 | $ 2,433,105 |
Revenue from Contract with Cu_2
Revenue from Contract with Customer - Schedule of Changes in Contract Liability (Details) | 9 Months Ended |
Sep. 30, 2018USD ($) | |
Disaggregation Of Revenue [Line Items] | |
Beginning Balance | $ 837,885 |
Deferral of revenue | 724,750 |
Recognition of deferred revenue | (1,174,660) |
Ending Balance | 387,975 |
Product Revenue | |
Disaggregation Of Revenue [Line Items] | |
Beginning Balance | 39,426 |
Deferral of revenue | 151,461 |
Recognition of deferred revenue | (135,980) |
Ending Balance | 54,907 |
Custom RUO Assay Design | |
Disaggregation Of Revenue [Line Items] | |
Beginning Balance | 197,606 |
Deferral of revenue | 336,080 |
Recognition of deferred revenue | (453,768) |
Ending Balance | 79,918 |
Sample Processing | |
Disaggregation Of Revenue [Line Items] | |
Beginning Balance | 490,536 |
Deferral of revenue | 166,291 |
Recognition of deferred revenue | (403,677) |
Ending Balance | 253,150 |
Collaborative Development Services | |
Disaggregation Of Revenue [Line Items] | |
Beginning Balance | 110,317 |
Deferral of revenue | 70,918 |
Recognition of deferred revenue | $ (181,235) |
Other Agreements - Additional I
Other Agreements - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
Other Agreements [Line Items] | |||||
Research and development | $ 3,561,459 | $ 3,478,419 | $ 8,909,729 | $ 6,364,371 | |
Illumina, Inc. Agreement | |||||
Other Agreements [Line Items] | |||||
Research and development | 0 | $ 0 | 12,500 | $ 50,000 | |
NuvoGen Asset Purchase Agreement | |||||
Other Agreements [Line Items] | |||||
Asset purchase agreement quarterly installments due from beginning 2018 | 400,000 | $ 400,000 | |||
Percentage on annual revenues for cash consideration to be paid | 6.00% | ||||
Accrued revenue-based payments | $ 0 | ||||
Asset purchase agreement fixed quarterly payments | 100,000 | $ 100,000 | |||
Additional revenue based payments payable | $ 182,383 | $ 182,383 | $ 85,574 |
Other Agreements - Schedule of
Other Agreements - Schedule of Remaining Minimum Principal Payments Due (Details) - NuvoGen Asset Purchase Agreement | Sep. 30, 2018USD ($) |
Purchase Obligation Fiscal Year Maturity [Line Items] | |
2,018 | $ 282,383 |
2,019 | 400,000 |
2,020 | 400,000 |
2,021 | 400,000 |
2,022 | 400,000 |
2023 and beyond | 5,286,621 |
Total NuvoGen obligation payments | 7,169,004 |
Plus interest accretion | 109,487 |
Total NuvoGen obligation, net | $ 7,278,491 |
Net Loss per Share - Numerator
Net Loss per Share - Numerator and Denominator Used in Computing Basic and Diluted Net Loss per Share (Detail) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Numerator: | ||||
Net loss | $ (4,843,408) | $ (5,380,846) | $ (14,326,084) | $ (17,038,022) |
Denominator: | ||||
Weighted-average shares outstanding-basic and diluted | 28,434,406 | 11,603,617 | 27,184,968 | 9,794,651 |
Net loss per share, basic and diluted | $ (0.17) | $ (0.46) | $ (0.53) | $ (1.74) |
Net Loss per Share - Outstandin
Net Loss per Share - Outstanding Securities Excluded from Computation of Diluted Net Loss per Share (Detail) - shares | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Options to purchase common stock | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Anti-dilutive securities excluded from computation of diluted net loss per share | 2,148,323 | 1,532,979 |
Restricted Stock Units R S U | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Anti-dilutive securities excluded from computation of diluted net loss per share | 249,166 | 34,999 |
Warrant | Common Stock | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Anti-dilutive securities excluded from computation of diluted net loss per share | 237,846 | 219,723 |
QNAH convertible note | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Anti-dilutive securities excluded from computation of diluted net loss per share | 772,075 |
Warrants - Additional Informati
Warrants - Additional Information (Details) - $ / shares | 9 Months Ended | |
Sep. 30, 2018 | Mar. 31, 2018 | |
Warrants And Rights Note Disclosure [Abstract] | ||
Warrants issued to acquire shares | 18,123 | |
Warrants exercise price | $ 7.73 | |
Warrants expiration date | Mar. 31, 2018 | |
Warrants expiration description | tenth anniversary |
Warrants -Summary of Outstandin
Warrants -Summary of Outstanding Warrants (Details) - $ / shares | 9 Months Ended | |
Sep. 30, 2018 | Mar. 31, 2018 | |
Class Of Warrant Or Right [Line Items] | ||
Exercise Price/Share | $ 7.73 | |
Convertible Note Warrants | ||
Class Of Warrant Or Right [Line Items] | ||
Shares of Common Stock Underlying Warrants | 144,772 | |
Exercise Price/Share | $ 14 | |
Expiration Date | 2,022 | |
Common Stock Warrants one | ||
Class Of Warrant Or Right [Line Items] | ||
Shares of Common Stock Underlying Warrants | 931 | |
Exercise Price/Share | $ 6.45 | |
Expiration Date | 2,019 | |
Common Stock Warrants | ||
Class Of Warrant Or Right [Line Items] | ||
Shares of Common Stock Underlying Warrants | 45,307 | |
Exercise Price/Share | $ 2.76 | |
Expiration Date | 2,026 | |
Common Stock Tranche one | ||
Class Of Warrant Or Right [Line Items] | ||
Shares of Common Stock Underlying Warrants | 18,123 | |
Exercise Price/Share | $ 7.73 | |
Expiration Date | 2,028 | |
Series E Redeemable Convertible Preferred Stock | ||
Class Of Warrant Or Right [Line Items] | ||
Shares of Common Stock Underlying Warrants | 28,713 | |
Exercise Price/Share | $ 23.51 | |
Expiration Date | 2,024 |
Stockholders Deficit - Addition
Stockholders Deficit - Additional Information (Details) - USD ($) | Jan. 31, 2018 | Jan. 29, 2018 | Jun. 30, 2017 | Apr. 30, 2017 | Jun. 30, 2018 | Jan. 31, 2018 | Sep. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 |
Class Of Stock [Line Items] | |||||||||||
Issuance of common stock from the ATM Offering, Shares | 5,733,314 | ||||||||||
Gross proceeds from issuance of common stock | $ 21,100,000 | ||||||||||
Sales commission | 600,000 | ||||||||||
Other offering expenses paid | 200,000 | ||||||||||
Net proceeds from issuance of common stock from the ATM Offering | $ 20,200,000 | ||||||||||
Accelerated vesting of stock options | 46,613 | ||||||||||
Options extended exercise period | 1 year | ||||||||||
Incremental stock-based compensation expense | $ 0 | $ 79,400 | |||||||||
Stock-based compensation | 257,975 | $ 357,405 | 1,643,353 | $ 1,171,988 | |||||||
Selling, General and Administrative | |||||||||||
Class Of Stock [Line Items] | |||||||||||
Stock-based compensation | 200,317 | $ 251,924 | 1,475,975 | $ 826,098 | |||||||
Restricted Stock Units R S U | |||||||||||
Class Of Stock [Line Items] | |||||||||||
Unrecognized compensation expense | 766,054 | $ 766,054 | |||||||||
Compensation expense period expected to be recognized | 3 years 6 months | ||||||||||
Vested and unissued RSU awards, description | Vested and unissued awards at September 30, 2018 represents RSU awards granted on August 16, 2018 for which the first vesting date was September 30, 2018, but for which issuance of the awards occurred on the next business day, October 1, 2018. | ||||||||||
Vested and unissued RSU awards granted date | Aug. 16, 2018 | ||||||||||
Vested and unissued RSU awards vesting date | Sep. 30, 2018 | ||||||||||
Vested and unissued RSU awards issuance date | Oct. 1, 2018 | ||||||||||
Issuance of shares granted | 492,051 | ||||||||||
Restricted stock grant date fair value | $ 3.63 | ||||||||||
Restricted Stock Units R S U | Executive Officers | |||||||||||
Class Of Stock [Line Items] | |||||||||||
Issuance of shares granted | 259,551 | ||||||||||
Restricted stock grant date fair value | $ 3.84 | ||||||||||
Restricted Stock Units R S U | Selling, General and Administrative | Executive Officers | |||||||||||
Class Of Stock [Line Items] | |||||||||||
Stock-based compensation | $ 1,000,000 | ||||||||||
Two Thousand Fourteen Equity Incentive Plan | Employee Stock Option | |||||||||||
Class Of Stock [Line Items] | |||||||||||
Unrecognized compensation expense | $ 1,915,080 | $ 1,915,080 | |||||||||
Compensation expense period expected to be recognized | 3 years 2 months 19 days | ||||||||||
Underwritten Public Offering | |||||||||||
Class Of Stock [Line Items] | |||||||||||
Common stock price per share | $ 2.90 | $ 2.90 | |||||||||
Issuance of common stock from the ATM Offering, Shares | 13,915,000 | ||||||||||
Net proceeds from initial public offering after underwriters' discounts, commissions and offering expenses | $ 37,700,000 | ||||||||||
Over-Allotment Option | |||||||||||
Class Of Stock [Line Items] | |||||||||||
Issuance of common stock from the ATM Offering, Shares | 1,815,000 | ||||||||||
Common Stock | |||||||||||
Class Of Stock [Line Items] | |||||||||||
Issuance of common stock from the ATM Offering, Shares | 300,000 | ||||||||||
Gross proceeds from issuance of common stock | $ 600,000 | ||||||||||
Sales Agreement | |||||||||||
Class Of Stock [Line Items] | |||||||||||
Common stock price per share | $ 0.001 | ||||||||||
Common stock aggregate offering price | $ 23,000,000 | $ 40,000,000 | $ 20,000,000 |
Stockholders Deficit - Summary
Stockholders Deficit - Summary of Stock Option Plans Activity (Details) - Employee Stock Option - USD ($) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2018 | Dec. 31, 2017 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Number of Shares, Beginning Balance | 1,517,771 | |
Number of Shares, Granted | 802,500 | |
Number of Shares, Exercised | (96,164) | |
Number of Shares, Forfeited | (35,679) | |
Number of Shares, Expired/Cancelled | (40,105) | |
Number of Shares, Ending Balance | 2,148,323 | 1,517,771 |
Number of Shares, Exercisable | 1,258,202 | |
Weighted-Average Exercise Price Per Share, Beginning Balance | $ 2.97 | |
Weighted-Average Exercise Price Per Share, Granted | 3.39 | |
Weighted-Average Exercise Price Per Share, Exercised | 2.12 | |
Weighted-Average Exercise Price Per Share, Forfeited | 3.42 | |
Weighted-Average Exercise Price Per Share, Expired/Cancelled | 6.81 | |
Weighted-Average Exercise Price Per Share, Ending Balance | 3.08 | $ 2.97 |
Weighted-Average Exercise Price Per Share, Exercisable | $ 2.93 | |
Weighted-Average Remaining Contractual Life, Outstanding | 7 years 9 months 18 days | 7 years 6 months |
Weighted-Average Remaining Contractual Life, Exercisable | 6 years 6 months | |
Aggregate Intrinsic Value, Balance | $ 4,624,110 | $ 67,242 |
Aggregate Intrinsic Value, Exercised | 182,678 | |
Aggregate Intrinsic Value, Exercisable | $ 3,065,442 |
Stockholders Deficit - Summar_2
Stockholders Deficit - Summary of Restricted Stock Unit ('RSU') Plans Activity (Details) - Restricted Stock Units R S U | 9 Months Ended |
Sep. 30, 2018$ / sharesshares | |
Restricted Stock Units (RSU) | |
Beginning Balance | shares | 26,666 |
Granted | shares | 492,051 |
Released | shares | (269,551) |
Ending Balance | shares | 249,166 |
Vested and unissued at September 30, 2018 | shares | 13,126 |
Weighted Average Grant Date Fair Value Per Share | |
Beginning Balance | $ / shares | $ 2.78 |
Granted | $ / shares | 3.63 |
Released | $ / shares | 3.76 |
Ending Balance | $ / shares | 3.39 |
Vested and unissued at September 30, 2018 | $ / shares | $ 3.40 |
Stockholders Deficit - Summar_3
Stockholders Deficit - Summary of Stock-Based Compensation (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Stock-based compensation | $ 257,975 | $ 357,405 | $ 1,643,353 | $ 1,171,988 |
Selling, General and Administrative | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Stock-based compensation | 200,317 | 251,924 | 1,475,975 | 826,098 |
Research and Development | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Stock-based compensation | 41,553 | 79,619 | 121,651 | 261,083 |
Cost of Revenue | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Stock-based compensation | $ 16,105 | $ 25,862 | $ 45,727 | $ 84,807 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Commitments And Contingencies [Line Items] | ||||
Lease expiration term | The Company leases office and laboratory space in Tucson, Arizona under two non-cancelable operating leases. | |||
Computer Equipment | ||||
Commitments And Contingencies [Line Items] | ||||
Capital lease commitments | $ 87,444 | $ 87,444 | ||
Computer Equipment | Minimum | ||||
Commitments And Contingencies [Line Items] | ||||
Capital lease commitment period | 36 months | |||
Computer Equipment | Maximum | ||||
Commitments And Contingencies [Line Items] | ||||
Capital lease commitment period | 48 months | |||
Non-Executive Officer Employees | ||||
Commitments And Contingencies [Line Items] | ||||
Compensation expenses | $ 249,467 | $ 87,965 | $ 722,280 | $ 87,965 |
Commitments and Contingencies_2
Commitments and Contingencies - Minimum Real Estate Lease Payments Before Common Area Maintenance Charges (Details) | Sep. 30, 2018USD ($) |
Commitments And Contingencies Disclosure [Abstract] | |
2,018 | $ 127,983 |
2,019 | 514,977 |
2,020 | 517,457 |
2,021 | 43,139 |
Total minimum lease payments | $ 1,203,556 |
Commitments and Contingencies_3
Commitments and Contingencies - Schedule Of Product Warranty Reserve (Details) - USD ($) | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Commitments And Contingencies Disclosure [Abstract] | ||
Beginning balance | $ 37,156 | $ 50,426 |
Cost of warranty claims | (2,484) | (6,278) |
Increase in warranty reserve | 20,496 | 3,275 |
Ending balance | $ 55,168 | $ 47,423 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | ||||
Income tax examination, likelihood of unfavorable settlement | greater than 50 percent | |||
Uncertain tax positions | $ 0 | $ 0 | $ 0 | |
Accrued interest or penalties | 0 | 0 | 0 | |
Recognized interest or penalties | $ 0 | $ 0 | ||
Income taxes paid other than state minimum taxes | $ 0 | $ 0 | ||
U.S. federal corporate tax rate | 21.00% | 35.00% | ||
Tax cuts and jobs act of 2017, change in tax rate, decrease in deferred tax assets | $ 16,232,211 | |||
Tax cuts and jobs act of 2017, change in tax rate, net adjustment in deferred tax expense | $ 0 | |||
Percentage of taxable income in utilization of net operating losses | 80.00% | |||
Net operating loss carryforwards expiration period | 20 years |
Related-Party Transactions - Ad
Related-Party Transactions - Additional Information (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||
Oct. 31, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
Related Party Transaction [Line Items] | ||||||
Service revenue | $ 4,706,378 | $ 3,723,484 | $ 13,775,796 | $ 6,855,409 | ||
Accounts receivable | 3,361,333 | 3,361,333 | $ 6,356,268 | |||
Research and development | 3,561,459 | 3,478,419 | 8,909,729 | 6,364,371 | ||
Collaborative Development Services | ||||||
Related Party Transaction [Line Items] | ||||||
Service revenue | 3,391,534 | 2,130,694 | 8,704,094 | 2,433,105 | ||
SOW One | ||||||
Related Party Transaction [Line Items] | ||||||
Profit sharing payments included in collaborative development services revenue | 0 | 99,394 | ||||
Accounts receivable | 0 | 0 | 2,429,152 | |||
Research and development | 0 | 653,938 | 1,716,115 | 876,186 | ||
SOW One | Collaborative Development Services | ||||||
Related Party Transaction [Line Items] | ||||||
Service revenue | 0 | 846,368 | 2,397,136 | 1,123,779 | ||
SOW Two | ||||||
Related Party Transaction [Line Items] | ||||||
Profit sharing payments included in collaborative development services revenue | 439,910 | 826,279 | ||||
Accounts receivable | 1,537,518 | 1,537,518 | 1,796,157 | |||
Research and development | 1,667,303 | 2,431,445 | ||||
Costs | 0 | 0 | ||||
Revenues | 0 | 0 | ||||
SOW Two | Collaborative Development Services | ||||||
Related Party Transaction [Line Items] | ||||||
Service revenue | 2,184,493 | 3,665,311 | ||||
SOW Three | ||||||
Related Party Transaction [Line Items] | ||||||
Profit sharing payments included in collaborative development services revenue | 209,140 | 355,631 | ||||
Accounts receivable | 994,157 | 994,157 | 0 | |||
Research and development | 682,295 | 1,536,859 | ||||
Costs | 0 | 0 | ||||
Revenues | 0 | 0 | ||||
SOW Three | Collaborative Development Services | ||||||
Related Party Transaction [Line Items] | ||||||
Service revenue | 1,207,041 | $ 2,641,647 | ||||
QIAGEN Manchester Limited | ||||||
Related Party Transaction [Line Items] | ||||||
Agreement commencement period | 2016-11 | |||||
QIAGEN Manchester Limited | Maximum | ||||||
Related Party Transaction [Line Items] | ||||||
Term of Agreement | 1 year | |||||
QIAGEN North American Holdings, Inc. | Convertible Promissory Note | ||||||
Related Party Transaction [Line Items] | ||||||
Cash proceeds from issuance of subordinated notes | $ 3,000,000 | |||||
Unamortized deferred financing costs | 29,150 | $ 29,150 | $ 39,240 | |||
QIAGEN North American Holdings, Inc. | Convertible Promissory Note | Interest Expense | ||||||
Related Party Transaction [Line Items] | ||||||
Amortization of deferred financing costs | 3,363 | 0 | 10,090 | 0 | ||
Interest accrued | $ 22,685 | $ 0 | $ 67,315 | $ 0 |