Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2016 | Jul. 30, 2016 | |
Document and Entity Information | ||
Entity Registrant Name | COLLEGIUM PHARMACEUTICAL, INC | |
Entity Central Index Key | 1,267,565 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2016 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 23,528,440 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q2 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 110,747 | $ 95,697 |
Accounts receivable, net | 2,952 | |
Inventory | 1,214 | |
Prepaid expenses and other current assets | 1,537 | 1,186 |
Total current assets | 116,450 | 96,883 |
Property and equipment, net | 676 | 738 |
Intangible assets, net | 2,500 | |
Restricted cash | 97 | 97 |
Total assets | 119,723 | 97,718 |
Current liabilities: | ||
Accounts payable | 6,074 | 3,537 |
Accrued expenses | 5,536 | 2,228 |
Deferred revenue | 3,926 | |
Current portion of term loan payable | 2,667 | 2,667 |
Total current liabilities | 18,203 | 8,432 |
Lease incentive obligation | 51 | 68 |
Term loan payable, long-term | 2,813 | 4,146 |
Total liabilities | 21,067 | 12,646 |
Commitments and contingencies (see note 11) | ||
Shareholders’ equity (deficit): | ||
Preferred stock, $0.001 par value; authorized shares 5,000,000 at June 30, 2016 and December 31, 2015; issued and outstanding shares - none at June 30, 2016 and December 31, 2015 | ||
Common stock, $0.001 par value; authorized shares - 100,000,000 at June 30, 2016 and December 31, 2015; issued and outstanding shares - 23,528,119 at June 30, 2016 and 20,739,351 at December 31, 2015 | 24 | 21 |
Additional paid-in capital | 267,815 | 214,062 |
Accumulated deficit | (169,180) | (129,008) |
Treasury stock | (3) | (3) |
Total shareholders’ equity | 98,656 | 85,072 |
Total liabilities and shareholders’ equity | $ 119,723 | $ 97,718 |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Jun. 30, 2016 | Dec. 31, 2015 |
CONDENSED CONSOLIDATED BALANCE SHEETS | ||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, authorized shares | 100,000,000 | 100,000,000 |
Common stock, issued shares | 23,528,119 | 20,739,351 |
Common stock, outstanding shares | 23,528,119 | 20,739,351 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Operating expenses: | ||||
Research and development | $ 4,301 | $ 1,641 | $ 8,363 | $ 3,086 |
Selling, general and administrative | 20,173 | 2,934 | 31,698 | 5,120 |
Total operating expenses | 24,474 | 4,575 | 40,061 | 8,206 |
Loss from operations | (24,474) | (4,575) | (40,061) | (8,206) |
Other expense (income): | ||||
Interest expense, net | 46 | 99 | 111 | 254 |
Gain on extinguishment of debt | (91) | |||
Total other expense, net | 46 | 99 | 111 | 163 |
Net loss | $ (24,520) | $ (4,674) | $ (40,172) | $ (8,369) |
Earnings (loss) per share - basic and diluted | $ (1.05) | $ (0.45) | $ (1.73) | $ (0.18) |
Weighted-average shares - basic and diluted | 23,417,378 | 11,791,546 | 23,273,765 | 6,426,431 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
Operating activities | ||
Net loss | $ (40,172) | $ (8,369) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 87 | 92 |
Lease incentive | (17) | (16) |
Stock-based compensation expense | 2,496 | 714 |
Non cash interest expense | 7 | |
Changes in operating assets and liabilities: | ||
Accounts receivable | (2,952) | |
Inventories | (1,214) | |
Prepaid expenses and other current assets | (351) | (692) |
Refundable PDUFA fee | 2,335 | |
Accounts payable | 2,537 | 32 |
Deferred revenue | 3,926 | |
Accrued expenses | 3,308 | (195) |
Net cash used in operating activities | (32,352) | (6,092) |
Investing activities | ||
Purchase of intangible assets | (2,500) | |
Purchases of property and equipment | (25) | (23) |
Net cash used in investing activities | (2,525) | (23) |
Financing activities | ||
Repayment of term note | (1,333) | (368) |
Repayment of lease note payable | (29) | |
Restricted cash | (16) | |
Proceeds from the exercise of stock options | 86 | 471 |
Net cash provided by financing activities | 49,927 | 116,894 |
Net increase in cash and cash equivalents | 15,050 | 110,779 |
Cash and cash equivalents at beginning of period | 95,697 | 1,634 |
Cash and cash equivalents at end of period | 110,747 | 112,413 |
Supplemental disclosure of cash flow information | ||
Cash paid for offering costs | 512 | 1,598 |
Cash paid for interest | 159 | 202 |
Supplemental disclosure of non-cash activities | ||
Accruals of offering costs | 105 | |
Accruals of dividends and accretion to redemption value | 24,572 | |
Common stock | ||
Financing activities | ||
Proceeds from issuance of stock, net of issuance costs | $ 51,174 | 72,029 |
Series D convertible redeemable preferred stock | ||
Financing activities | ||
Proceeds from issuance of stock, net of issuance costs | $ 44,807 |
CONDENSED CONSOLIDATED STATEME6
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
Class of Stock [Line Items] | ||
Stock issuance costs | $ 526 | |
Common stock | ||
Class of Stock [Line Items] | ||
Stock issuance costs | $ 526 | $ 2,408 |
Series D convertible redeemable preferred stock | ||
Class of Stock [Line Items] | ||
Stock issuance costs | $ 193 |
Nature of Business
Nature of Business | 6 Months Ended |
Jun. 30, 2016 | |
Nature of Business | |
Nature of Business | 1. Nature of Business Collegium Pharmaceutical, Inc. (the ‘‘Company’’) was incorporated in Delaware in April 2002 and then reincorporated in Virginia in July 2014. The Company has its principal operations in Canton, Massachusetts. The Company is a specialty pharmaceutical company developing and beginning to commercialize next-generation abuse-deterrent products that incorporate the Company’s patented DETERx® technology platform for the treatment of chronic pain and other diseases. The Company’s first product, Xtampza ER®, or Xtampza, is an abuse-deterrent, extended-release, oral formulation of oxycodone, a widely prescribed opioid medication. On April 26, 2016, the U.S. Food and Drug Administration (‘‘FDA’’) approved the Company’s new drug application (‘‘NDA’’) filing for Xtampza for the management of pain severe enough to require daily, around-the-clock, long-term opioid treatment and for which alternative treatment options are inadequate. On June 20, 2016, the Company announced the commercial launch of Xtampza. The Company’s operations are subject to certain risks and uncertainties. The principal risks include inability to successfully commercialize products, negative outcome of clinical trials, inability or delay in completing clinical trials or obtaining regulatory approvals, changing market conditions for products and product candidates (including development of competing products), the need to retain key personnel and protect intellectual property, patent infringement litigation and the availability of additional capital financing on terms acceptable to the Company. The Company has an accumulated deficit of $ 169,180 at June 30, 2016. The Company has financed its operations primarily through private placements of its preferred stock, proceeds from borrowings, an initial public offering completed in 2015 and a follow-on offering completed in 2016. The Company anticipates that it will continue to incur losses for the next several years, and it expects the losses to increase as it continues the development of, and seeks regulatory approvals for its product candidates, and begins to commercialize Xtampza. The Company believes that its cash, cash equivalents and marketable securities at June 30, 2016, together with expected cash inflows from the commercialization of Xtampza, will enable the Company to fund its operating expenses, debt service and capital expenditure requirements for at least twelve months from the filing date of this Quarterly Report on Form 10-Q. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2016 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Basis of presentation The accompanying unaudited condensed consolidated financial statements include the accounts of Collegium Pharmaceutical, Inc. (a Virginia corporation) as well as the accounts of Collegium Securities Corp. (a Massachusetts corporation), incorporated in December 2015, a wholly-owned subsidiary requiring consolidation. The financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial reporting and as required by Regulation S-X, Rule 10-01. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of the Company’s management, the accompanying unaudited condensed consolidated financial statements contain all adjustments (consisting of items of a normal and recurring nature) necessary to fairly present the financial position as of June 30, 2016, the results of operations for the three and six months ended June 30, 2016 and 2015, and cash flows for the six months ended June 30, 2016 and 2015. The results of operations for the three and six month periods ended June 30, 2016 are not necessarily indicative of the results to be expected for the full year. When preparing financial statements in conformity with GAAP, the Company must make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, expenses and related disclosures at the date of the financial statements. Actual results could differ from those estimates. The consolidated interim financial statements should be read in conjunction with the audited financial statements and notes thereto included in the Company’s Annual Report. Public Offerings of Common Stock In May 2015, the Company closed an initial public offering (“IPO”) of its common stock, which resulted in the sale of 6,670,000 shares of its common stock at a public offering price of $12.00 per share, including 870,000 shares of common stock upon the exercise by the underwriters of their option to purchase additional shares at the public offering price. The Company received proceeds from the IPO of approximately $72,029 , after deducting underwriting discounts, commissions and expenses payable by the Company. In connection with preparing for the IPO, the Company’s Board of Directors and shareholders approved a one -for-6.9 reverse stock split of the Company’s common stock. The reverse stock split became effective in April 2015. All share and per share amounts in the consolidated interim financial statements and notes thereto have been retroactively adjusted for all periods presented to give effect to this reverse stock split, including reclassifying an amount equal to the reduction in par value of common stock to additional paid-in capital. In connection with the closing of the IPO, all of the Company’s outstanding convertible preferred stock automatically converted to common stock in May 2015, resulting in an additional 12,591,456 shares of common stock of the Company becoming outstanding. In January 2016, the Company issued and sold in a public offering an aggregate of 2,750,000 shares of its common stock at $20.00 per share. This public offering resulted in approximately $51,174 of net proceeds, after deduction of underwriting discounts and commissions and expenses payable by the Company. The significant increase in common stock outstanding in June 2016 is expected to impact the year-over-year comparability of the Company’s net loss per share calculations in future periods. Subsequent Events We consider events or transactions that occur after the balance sheet date but before the financial statements are issued to provide additional evidence relative to certain estimates or to identify matters that require additional disclosure. Subsequent events have been evaluated through the date of issuance of these financial statements. Significant Accounting Policies Inventory Inventories are stated at the lower of cost or market. Inventory costs consist of costs related to the manufacturing of Xtampza, which are primarily the costs of contract manufacturing. The Company determines the cost of its inventories on a specific identification basis. If the Company identifies excess, obsolete or unsalable items, inventories are written down to their realizable value in the period in which the impairment is identified. Estimates of excess inventory consider various factors, including inventory levels, the level of product in the distribution channel, the Company’s projected sales of the product, as well as the remaining shelf lives of the product. Inventories that are not expected to be used within one year are recorded as a non-current asset. The Company outsources the manufacturing of Xtampza to a sole contract manufacturer that produces the finished product. In addition, the Company currently relies on a sole supplier for the active pharmaceutical ingredient for Xtampza. Accordingly, the Company has concentration risk associated with its manufacturing for supply of Xtampza. Prior to receiving approval from the FDA in April 2016, to market Xtampza, the Company expensed all costs incurred related to the manufacturing of Xtampza as research and development costs because of the inherent risks associated with the development of a product candidate, the uncertainty about the regulatory approval process and the lack of regulatory approval history for the Company’s product candidates. The Company has capitalized $1,214 of inventory as of June 30, 2016. Certain materials used in the manufacture of Xtampza were expensed prior to FDA approval. The Company expects sales of the capitalized units to occur during the next twelve months. The Company expects the cost of product revenue to increase as the Company begins to sell inventory that was produced entirely after the FDA approval of Xtampza. Revenue Recognition Revenue for product sales is recognized when there is persuasive evidence of an arrangement, title and risk of loss have passed to the customer, when estimated provisions for chargebacks, rebates, sales incentives and allowances, distribution service fees, and returns are reasonably determinable, and when collectability is reasonably assured. Product sales are recorded net of estimated chargebacks, rebates, sales incentives and allowance, distribution service fees, as well as estimated product returns. The Company has not yet recorded any product revenue, as it has not yet concluded that it meets the revenue recognition criteria under current accounting guidance The requisite historical data on which to base estimates of returns is insufficient due to the uniqueness of the product as compared to other products in the industry. Therefore revenue is deferred until such time that an estimate can be determined, all the conditions above are met and when the product has achieved market acceptance, which is typically based on dispensed prescription data and other information obtained during the period following launch. Advertising and Product Promotion Costs Advertising and product promotion costs are included in selling, general and administrative expenses and were $4,680 and $7,006 in the three and six months ended June 30, 2016. Advertising and product promotion costs are expensed as incurred. Recent Accounting Pronouncements New accounting pronouncements are issued periodically by the Financial Accounting Standards Board (“FASB”) and are adopted by the Company as of the specified effective dates. In May 2014, FASB issued Accounting Standard Update, or ASU, 2014-09 (ASC 606), Revenue from Contracts with Customers , which affects any entity that either enters into contracts with customers to transfer goods and services or enters into contracts for the transfer of nonfinancial assets. ASU 2014-09 will replace most existing revenue recognition guidance in GAAP when it becomes effective. The standard’s core principle is that a company will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. In doing so, companies will need to use more judgment and make more estimates than under the currently effective guidance. These may include identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price, and allocating the transaction price to each separate performance obligation. ASU 2014-09 was initially to be effective for annual periods beginning after December 15, 2016, including interim periods within that period. In August 2015, the FASB issued ASU 2015-14, Revenue from Contracts with Customers , which delays the effective date of ASU 2014-09 by one year to annual periods beginning after December 15, 2017. The standard allows for early adoption as of the original effective date. In March 2016, the FASB issued ASU 2016-08, Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations, or ASU 2016-08, which clarifies certain principal versus agent considerations. The Company is currently evaluating its effect on the Company’s consolidated financial statements. In June 2014, the FASB issued ASU 2014 ‑12, Compensation — Stock Compensation (Topic 718): Accounting for Share ‑Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved After the Requisite Service Period . ASU 2014 ‑12 applies to all reporting entities that grant their employees share ‑based payments in which the terms of the award provide that a performance target that affects vesting could be achieved after the requisite service period. The standard is required to be adopted by public business entities in annual periods beginning on or after December 15, 2015 and interim periods within those annual periods. The Company adopted this standard in the first quarter of fiscal year 2016 and it did not have a material impact on our financial statements as of and for the quarter and six months ended June 30, 2016. The Company has stock options with a performance based vesting condition, which if achieved would result in the recognition of $193 in stock compensation expense in the period vested. In August 2014, the FASB issued ASU No. 2014 ‑15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern. ASU 2014 ‑15 requires management to evaluate, at each annual or interim reporting period, whether there are conditions or events that exist that raise substantial doubt about an entity’s ability to continue as a going concern within one year after the date the financial statements are issued and provide related disclosures. ASU 2014 ‑15 is effective for annual periods ending after December 15, 2016 and earlier application is permitted. The adoption of ASU 2014 ‑15 is not expected to have a material effect on the Company’s financial statements or disclosures. In July 2015, the FASB issued ASU 2015-11, Simplifying the Measurement of Inventory , or ASU 2015-11. ASU 2015-11 applies to all inventory, except for inventory measured using the last-in, first-out method or the retail inventory method. The guidance allows an entity to measure inventory at the lower of cost and net realizable value. Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. The amendments in ASU 2015-11 are effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years, and may be applied prospectively with earlier adoption permitted. As the Company is in the early stages of commercialization of Xtampza, the Company has adopted ASU 2015-11 upon the initial capitalization of inventory. In November 2015, the FASB issued ASU 2015-17, Income Taxes: Balance Sheet Classification of Deferred Taxes (Topic 740) . ASU 2015-17 simplifies the presentation of deferred income taxes by eliminating the separate classification of deferred income tax assets and liabilities into current and noncurrent amounts in the consolidated balance sheet statement of financial position. The amendments in the update require that all deferred tax assets and liabilities be classified as noncurrent in the consolidated balance sheet. The amendments in this update are effective for annual periods beginning after December 15, 2017, and interim periods therein and may be applied either prospectively or retrospectively to all periods presented. Early adoption is permitted. The Company is currently evaluating its effect on the Company’s consolidated financial statements. In February 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2016-02, Leases (Topic 842) . The ASU requires lessees to put most leases on their balance sheets as a liability for the obligation to make lease payments and as a right-of-use asset, but recognize expenses on the income statements in a manner similar to today’s accounting. The guidance also eliminates the current real estate-specific provisions for all entities. For calendar-year public entities, the guidance becomes effective in 2019 and interim periods within that year. Early adoption is permitted for all entities. The Company has not chosen early adoption for this ASU and is currently evaluating its effect on the Company’s consolidated financial statements In March 2016, the Financial Accounting Standards Board, or FASB, issued Accounting Standard Update, or ASU, 2016-09, Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting , or ASU 2016-09. ASU 2016-09 intends to simplify various aspects of how share-based payments are accounted for and presented in the financial statements. The main provisions include: all tax effects related to stock awards will now be recorded through the statement of operations instead of through equity, all tax-related cash flows resulting from stock awards will be reported as operating activities on the cash flow statement, and entities can make an accounting policy election to either estimate forfeitures or account for forfeitures as they occur. The amendments in ASU 2016-09 are effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years, and may be applied prospectively with earlier adoption permitted. The Company is currently evaluating the impact of this guidance on its consolidated financial statements. |
Earnings (Loss) per Common Shar
Earnings (Loss) per Common Share | 6 Months Ended |
Jun. 30, 2016 | |
Earnings (Loss) per Common Share | |
Earnings (Loss) per Common Share | 3. Earnings (Loss) per Common Share Earnings (loss) per common share is calculated using the two-class method, which is an earnings allocation formula that determines earnings (loss) per share for the holders of the Company’s common shares and participating securities. All series of preferred stock contain participation rights in any dividend paid by the Company and are deemed to be participating securities. Earnings available to common shareholders and participating convertible redeemable preferred shares is allocated first to the preferred shareholders based upon the distribution criteria in the Company’s Articles of Incorporation then the remainder to the common shareholders. The participating securities do not include a contractual obligation to share in losses of the Company and are not included in the calculation of net loss per share in the periods that have a net loss. Diluted earnings per share is computed using the more dilutive of (a) the two-class method, or (b) the if-converted method. The Company allocates earnings first to preferred shareholders based on dividend rights and then to common and preferred shareholders based on ownership interests. The weighted-average number of common shares included in the computation of diluted earnings (loss) gives effect to all potentially dilutive common equivalent shares, including outstanding stock options, warrants, convertible redeemable preferred stock and the potential issuance of stock upon the conversion of the Company’s convertible notes. Common stock equivalent shares are excluded from the computation of diluted earnings (loss) per share if their effect is antidilutive. Three months ended Six months ended June 30, June 30, 2016 2015 2016 2015 Net loss $ $ $ $ Extinguishment of preferred stock - see note 9 — — — Accretion of prior preferred stock — — — Accretion and dividends of series D preferred stock — — Loss attributable to common shareholders — basic and diluted $ $ $ $ Weighted-average number of common shares used in net loss per share - basic and diluted (Loss) earnings per share - basic $ $ $ $ The following potentially dilutive securities, which represent all outstanding potentially dilutive securities, were excluded from the calculation of diluted net loss per share due to their anti-dilutive effect (in common stock equivalent shares): Three months ended Six months ended June 30, June 30, 2016 2015 2016 2015 Outstanding stock options Warrants Redeemable convertible preferred stock — — — — Unvested restricted stock |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 6 Months Ended |
Jun. 30, 2016 | |
Fair Value of Financial Instruments | |
Fair Value of Financial Instruments | 4. Fair Value of Financial Instruments The Company is required to disclose information on all assets and liabilities reported at fair value that enables an assessment of the inputs used in determining the reported fair values. The fair value hierarchy is now established that prioritizes valuation inputs based on the observable nature of those inputs. The fair value hierarchy applies only to the valuation inputs used in determining the reported fair value of the investments and is not a measure of the investment credit quality. The hierarchy defines three levels of valuation inputs: Level 1 inputs Quoted prices (unadjusted) in active markets for identical assets or liabilities Level 2 inputs Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly Level 3 inputs Unobservable inputs that reflect the Company’s own assumptions about the assumptions market participants would use in pricing the asset or liability The following tables present the Company’s financial instruments carried at fair value using the lowest level input applicable to each financial instrument at June 30, 2016 and December 31, 2015. Significant Quoted Prices other Significant in active observable unobservable markets inputs inputs Description Total (Level 1) (Level 2) (Level 3) June 30, 2016 Money market funds, included in cash equivalents $ $ $ — $ — December 31, 2015 Money market funds, included in cash equivalents $ $ $ — $ — The Company’s cash equivalents are comprised of money market funds that are measured on a recurring basis based on quoted market prices. As of June 30, 2016 and December 31, 2015, the carrying amounts of cash and cash equivalents, accounts payable, loan payable and accrued expenses approximated their estimated fair values because of the short-term nature of these financial instruments. |
Inventory
Inventory | 6 Months Ended |
Jun. 30, 2016 | |
Inventory Disclosure [Abstract] | |
Inventory | 5. Inventory Upon approval of Xtampza by the FDA in April 2016, the Company began capitalizing inventory costs for Xtampza manufactured in preparation for the product launch. In periods prior to April 2016, the Company expensed costs associated with Xtampza, including raw materials, work in process and finished goods, as development expenses. The Company has not capitalized inventory costs related to its other drug development programs. The following table sets forth the Company’s inventories as of June 30, 2016: June 30, 2016 Raw materials $ Work in process — Finished goods Total inventory $ |
Intangible Asset
Intangible Asset | 6 Months Ended |
Jun. 30, 2016 | |
Intangible Assets, Gross (Excluding Goodwill) [Abstract] | |
Intangible Asset | 6. Intangible Asset In May 2016, the Company entered into an agreement with BioDelivery Sciences International, Inc. (BDSI) to license the rights to develop, manufacture, and commercialize ONSOLIS® (fentanyl buccal soluble film) in the United States. ONSOLIS is a Transmucosal Immediate-Release Fentanyl (TIRF) film indicated for the management of breakthrough pain in certain cancer patients. The Company expects to launch the product after the completion of the transfer of manufacturing and required submission to the FDA of a Prior Approval Supplement. Subject to FDA approval of the Prior Approval Supplement, the Company expects to launch ONSOLIS during the second half of 2017. I n addition, during the term of the License Agreement, milestone payments in the aggregate amount of $21.0 million may become payable by the Company subject to the satisfaction of certain commercialization, intellectual property, and net sales milestones, including $4 million upon the first commercial sale of the p roduct in the U.S. Finally, the Company will be required to pay royalties in the upper teens based on annual net sales of the p roduct in the U.S The Company made an upfront payment of $2.5 million and is contractually committed to reimburse BDSI up to a maximum of $2.0 million for its out-of-pocket expenses incurred in conjunction with the manufacturing transfer. The Company recorded the upfront payment as an intangible asset on the Condensed Consolidated Balance Sheet at June 30, 2016 and will amortize it over the shorter of the remaining patent life or the estimated period of economic benefit. |
Accrued Expenses
Accrued Expenses | 6 Months Ended |
Jun. 30, 2016 | |
Accrued Expenses | |
Accrued Expenses | 7. Accrued Expenses Accrued expenses consisted of the following: June 30, 2016 December 31, 2015 Accrued bonuses and incentive compensation $ $ Accrued payroll and related benefits Accrued sales & marketing Accrued development costs Accrued other operating costs Accrued audit and legal Accrued interest Total accrued expenses $ $ |
Convertible Bridge Note with Re
Convertible Bridge Note with Related Party | 6 Months Ended |
Jun. 30, 2016 | |
Convertible Bridge Note with Related Party | |
Convertible Bridge Note with Related Party | 8. Convertible Bridge Note with Related Party In November and December 2014, the Company entered into a Note Purchase Agreement (the "Bridge Notes") allowing for the issuance of $5,000 of convertible promissory notes to a group of investors (the "Holders") bearing interest at a rate per annum of 6.0% . The Holders are related parties of the Company. In connection with the Series D convertible preferred stock financing (see note 8), the Bridge Notes converted into Series D convertible preferred stock. Upon the conversion, the Company recognized a gain on extinguishment of $91 . |
Convertible Preferred Stock and
Convertible Preferred Stock and Equity | 6 Months Ended |
Jun. 30, 2016 | |
Convertible Preferred Stock and Equity | |
Convertible Preferred Stock and Equity | 9. Convertible Preferred Stock and Equity In March 2015, the Company issued and sold an aggregate of 41,666,667 shares of Series D convertible preferred stock for aggregate consideration of $50,000 , comprised of $45,000 in cash and conversion of $5,000 in Bridge Notes. The accrued interest on the convertible notes was waived. Concurrently with the issuance of the Series D convertible preferred stock, the Company amended and restated its Articles of Incorporation (the “Amended Articles”). The Company made certain amendments to the terms of the Series A, Series B, and Series C Preferred Stock (together, the “Prior Preferred Stock”). Prior to the adoption of the Amended Articles, the Series A, Series B, and Series C Preferred Stock accrued dividends at a rate of 4.5% , 8.0% and 8.0% per annum, respectively, per share. All accrued and unpaid dividends on the Prior Preferred Stock were automatically cancelled and forfeited and the Prior Preferred Stock no longer accrued dividends. Prior to the cancellation and forfeiture of accrued dividends, the Prior Preferred Stock had accrued dividends of $622 during 2015. The holders of outstanding shares of Prior Preferred Stock were entitled to receive dividends, when, as and if declared by the Board of Directors. The mandatory conversion for all series of Prior Preferred Stock was modified so as to occur upon an initial public offering with gross proceeds in excess of $50,000 . The amendments to the Prior Preferred Stock were treated as an extinguishment which resulted in a gain on extinguishment of $31,806 . The gain on extinguishment was added to net loss to arrive at income available to common shareholders in the calculation of earnings per share. In connection with the closing of the IPO, all of the Company’s outstanding convertible preferred stock automatically converted to common stock in May 2015, resulting in an additional 12,591,456 shares of common stock of the Company becoming outstanding. The changes in shareholders’ equity for the six-month period ended June 30, 2016 were as follows: Additional Treasury Other Accumulated Total Common Stock Paid- In Stock, Comprehensive Deficit Shareholders’ Shares Amount Capital at cost Income Equity (Deficit) Balance, January 1, 2016 $ $ $ $ — $ $ Public offering of common stock, net of issuance costs of $526 — — — Stock-based compensation - — — — — Exercise of common stock options — — — — Net loss — — — — — Balance, June 30, 2016 $ $ $ $ — $ $ |
Stock-based Compensation
Stock-based Compensation | 6 Months Ended |
Jun. 30, 2016 | |
Stock-based Compensation | |
Stock-based Compensation | 10. Stock-based Compensation Restricted Stock Awards and Stock Options In May 2015, the Company adopted the Amended and Restated 2014 Stock Incentive Plan (the “Plan”), under which an aggregate of 2,700,000 shares of common stock are authorized for issuance to employees, officers, directors, consultants and advisors of the Company, plus an annual increase to be added on the first day of each fiscal year until the expiration of the Plan equal to 4% of the total number of outstanding shares of common stock on December 31st of the immediately preceding calendar year (or a lower amount as otherwise determined by the board of directors prior to January 1st). As of June 30, 2016, there were 1,358,694 shares of common stock available for issuance pursuant to the Plan. The Plan provides for granting of both Internal Revenue Service qualified incentive stock options (“ISOs”) and non-qualified options (“NQs”), restricted stock awards (“RSAs”) and restricted stock units (“RSUs”). Stock options generally vest over a four year period of service; however, certain options are also subject to performance conditions. The options generally have a ten year contractual life and, upon termination, vested options are generally exercisable between one and three months following the termination date, while unvested options are forfeited immediately. Restricted common stock A summary of the Company’s restricted stock award (RSAs) activity for the six months ended June 30, 2016 and related information is as follows: Weighted average purchase price Shares per share Unvested at December 31, 2015 $ Granted — — Vested Unvested at June 30, 2016 (1) $ (1) Excludes 48,307 shares of unvested restricted stock remaining from the early exercise of stock options as of June 30, 2016. A summary of the Company’s restricted stock units (RSUs) activity for the six months ended June 30, 2016 and related information is as follows: Shares Average grant date fair value Outstanding at December 31, 2015 — $ — Granted Settled — — Forfeited — — Outstanding at June 30, 2016 $ Stock options A summary of the Company’s stock option activity and related information follows: Weighted- Weighted- average average remaining Aggregate exercise price contractual Intrinsic Shares per share term (years) Value Outstanding at December 31, 2015 $ $ Granted Exercised Cancelled Outstanding at June 30, 2016 $ $ Exercisable at June 30, 2016 $ $ Vested and expected to vest at June 30, 2016 $ $ The fair value of each stock option is estimated on the grant date using the Black-Scholes option-pricing model using the following assumptions: Six months ended 2016 2015 Risk-free interest rate % % Volatility % % Expected term (years) Expected dividend yield - - A summary of the Company’s compensation expense from stock-based payment awards follows: Three months ended Six months ended June 30, June 30, 2016 2015 2016 2015 Research and development expenses $ $ $ $ Selling, general and administrative expenses Total stock-based compensation expense $ $ $ $ At June 30, 2016, there was approximately $17,483 of unrecognized compensation expense related to unvested options, restricted stock units and restricted stock awards under the Plan, which is expected to be recognized as expense over a weighted average period of approximately 3. 2 years. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2016 | |
Commitments and Contingencies | |
Commitments and Contingencies | 11. Commitments and Contingencies From time to time, the Company may be subject to various claims and legal proceedings. If the potential loss from any claim, asserted or unasserted, or legal proceeding is considered probable and the amount is reasonably estimated, the Company will accrue a liability for the estimated loss. Except as disclosed below, the Company is not currently a party to any litigation and, accordingly, does not have any amounts recorded for any litigation related matters. The Company’s NDA filing for Xtampza is a 505(b)(2) application, which allows the Company to reference data from an approved drug listed in the FDA’s Approved Drug Products with Therapeutic Equivalence Evaluations (commonly known as the ‘‘Orange Book’’), in this case OxyContin OP. In connection with the 505(b)(2) process, the Company certified to the FDA and notified Purdue Pharma, L.P. (‘‘Purdue’’), as the holder of the NDA and any other Orange Book-listed patent owners, that the Company does not infringe any of the patents listed for OxyContin OP in the Orange Book. Under the Hatch-Waxman Act of 1984 (the ‘‘Hatch-Waxman Act’’), Purdue had the option to sue the Company for infringement and receive a stay of up to 30 months before the FDA can issue a final regulatory approval for Xtampza, unless the stay is earlier terminated. Purdue exercised its option and elected to sue the Company for infringement in the District of Delaware in March 2015 asserting infringement of three of Purdue’s Orange Book ‑ listed patents and one non-Orange Book-listed patent. Purdue filed another case in Massachusetts asserting the same four patents as in the Delaware case. In October 2015, the Delaware case was transferred to Massachusetts. In November 2015, Purdue filed suit asserting infringement of another non-Orange Book-listed patent. On November 9, 2015, the Company filed a motion for partial judgment on the pleadings in relation to three Orange Book-listed patents asserted against the Company, which had been previously invalidated by the court in the Southern District of New York in Purdue’s suit against another company. On February 1, 2016, the Court of Appeals for the Federal Circuit affirmed the New York judgment of invalidity. On May 4, 2016, the Court of Appeals for the Federal Circuit denied Purdue’s request for rehearing and rehearing en banc review was denied. On February 9, 2016, the District Court of Massachusetts ordered judgment in favor of the Company on the three Orange Book-listed patents that were the basis of the 30 -month stay, Patent Nos. 7,674,799, 7,674,800, and 7,683,072 and dismissed the claims asserting infringement of those patents with prejudice. Upon dismissal of those claims, the 30-month stay of FDA approval was lifted. Purdue continues to assert infringement of two patents against the Company, neither of which is associated with any stay of FDA approval. At this time the Company is unable to provide meaningful quantification of how this litigation may impact its future financial condition, results of operations, or cash flows. |
Summary of Significant Accoun18
Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2016 | |
Summary of Significant Accounting Policies | |
Basis of presentation | Basis of presentation The accompanying unaudited condensed consolidated financial statements include the accounts of Collegium Pharmaceutical, Inc. (a Virginia corporation) as well as the accounts of Collegium Securities Corp. (a Massachusetts corporation), incorporated in December 2015, a wholly-owned subsidiary requiring consolidation. The financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial reporting and as required by Regulation S-X, Rule 10-01. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of the Company’s management, the accompanying unaudited condensed consolidated financial statements contain all adjustments (consisting of items of a normal and recurring nature) necessary to fairly present the financial position as of June 30, 2016, the results of operations for the three and six months ended June 30, 2016 and 2015, and cash flows for the six months ended June 30, 2016 and 2015. The results of operations for the three and six month periods ended June 30, 2016 are not necessarily indicative of the results to be expected for the full year. When preparing financial statements in conformity with GAAP, the Company must make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, expenses and related disclosures at the date of the financial statements. Actual results could differ from those estimates. The consolidated interim financial statements should be read in conjunction with the audited financial statements and notes thereto included in the Company’s Annual Report. |
Public Offerings of Common Stock | Public Offerings of Common Stock In May 2015, the Company closed an initial public offering (“IPO”) of its common stock, which resulted in the sale of 6,670,000 shares of its common stock at a public offering price of $12.00 per share, including 870,000 shares of common stock upon the exercise by the underwriters of their option to purchase additional shares at the public offering price. The Company received proceeds from the IPO of approximately $72,029 , after deducting underwriting discounts, commissions and expenses payable by the Company. In connection with preparing for the IPO, the Company’s Board of Directors and shareholders approved a one -for-6.9 reverse stock split of the Company’s common stock. The reverse stock split became effective in April 2015. All share and per share amounts in the consolidated interim financial statements and notes thereto have been retroactively adjusted for all periods presented to give effect to this reverse stock split, including reclassifying an amount equal to the reduction in par value of common stock to additional paid-in capital. In connection with the closing of the IPO, all of the Company’s outstanding convertible preferred stock automatically converted to common stock in May 2015, resulting in an additional 12,591,456 shares of common stock of the Company becoming outstanding. In January 2016, the Company issued and sold in a public offering an aggregate of 2,750,000 shares of its common stock at $20.00 per share. This public offering resulted in approximately $51,174 of net proceeds, after deduction of underwriting discounts and commissions and expenses payable by the Company. The significant increase in common stock outstanding in June 2016 is expected to impact the year-over-year comparability of the Company’s net loss per share calculations in future periods. |
Subsequent Events | Subsequent Events We consider events or transactions that occur after the balance sheet date but before the financial statements are issued to provide additional evidence relative to certain estimates or to identify matters that require additional disclosure. Subsequent events have been evaluated through the date of issuance of these financial statements. |
Inventory | Inventory Inventories are stated at the lower of cost or market. Inventory costs consist of costs related to the manufacturing of Xtampza, which are primarily the costs of contract manufacturing. The Company determines the cost of its inventories on a specific identification basis. If the Company identifies excess, obsolete or unsalable items, inventories are written down to their realizable value in the period in which the impairment is identified. Estimates of excess inventory consider various factors, including inventory levels, the level of product in the distribution channel, the Company’s projected sales of the product, as well as the remaining shelf lives of the product. Inventories that are not expected to be used within one year are recorded as a non-current asset. The Company outsources the manufacturing of Xtampza to a sole contract manufacturer that produces the finished product. In addition, the Company currently relies on a sole supplier for the active pharmaceutical ingredient for Xtampza. Accordingly, the Company has concentration risk associated with its manufacturing for supply of Xtampza. Prior to receiving approval from the FDA in April 2016, to market Xtampza, the Company expensed all costs incurred related to the manufacturing of Xtampza as research and development costs because of the inherent risks associated with the development of a product candidate, the uncertainty about the regulatory approval process and the lack of regulatory approval history for the Company’s product candidates. The Company has capitalized $1,214 of inventory as of June 30, 2016. Certain materials used in the manufacture of Xtampza were expensed prior to FDA approval. The Company expects sales of the capitalized units to occur during the next twelve months. The Company expects the cost of product revenue to increase as the Company begins to sell inventory that was produced entirely after the FDA approval of Xtampza. |
Revenue Recognition | Revenue Recognition Revenue for product sales is recognized when there is persuasive evidence of an arrangement, title and risk of loss have passed to the customer, when estimated provisions for chargebacks, rebates, sales incentives and allowances, distribution service fees, and returns are reasonably determinable, and when collectability is reasonably assured. Product sales are recorded net of estimated chargebacks, rebates, sales incentives and allowance, distribution service fees, as well as estimated product returns. The Company has not yet recorded any product revenue, as it has not yet concluded that it meets the revenue recognition criteria under current accounting guidance The requisite historical data on which to base estimates of returns is insufficient due to the uniqueness of the product as compared to other products in the industry. Therefore revenue is deferred until such time that an estimate can be determined, all the conditions above are met and when the product has achieved market acceptance, which is typically based on dispensed prescription data and other information obtained during the period following launch. |
Advertising and Product Promotion Costs | Advertising and Product Promotion Costs Advertising and product promotion costs are included in selling, general and administrative expenses and were $4,680 and $7,006 in the three and six months ended June 30, 2016. Advertising and product promotion costs are expensed as incurred. |
Recently Issued Accounting Pronouncements | Recent Accounting Pronouncements New accounting pronouncements are issued periodically by the Financial Accounting Standards Board (“FASB”) and are adopted by the Company as of the specified effective dates. In May 2014, FASB issued Accounting Standard Update, or ASU, 2014-09 (ASC 606), Revenue from Contracts with Customers , which affects any entity that either enters into contracts with customers to transfer goods and services or enters into contracts for the transfer of nonfinancial assets. ASU 2014-09 will replace most existing revenue recognition guidance in GAAP when it becomes effective. The standard’s core principle is that a company will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. In doing so, companies will need to use more judgment and make more estimates than under the currently effective guidance. These may include identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price, and allocating the transaction price to each separate performance obligation. ASU 2014-09 was initially to be effective for annual periods beginning after December 15, 2016, including interim periods within that period. In August 2015, the FASB issued ASU 2015-14, Revenue from Contracts with Customers , which delays the effective date of ASU 2014-09 by one year to annual periods beginning after December 15, 2017. The standard allows for early adoption as of the original effective date. In March 2016, the FASB issued ASU 2016-08, Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations, or ASU 2016-08, which clarifies certain principal versus agent considerations. The Company is currently evaluating its effect on the Company’s consolidated financial statements. In June 2014, the FASB issued ASU 2014 ‑12, Compensation — Stock Compensation (Topic 718): Accounting for Share ‑Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved After the Requisite Service Period . ASU 2014 ‑12 applies to all reporting entities that grant their employees share ‑based payments in which the terms of the award provide that a performance target that affects vesting could be achieved after the requisite service period. The standard is required to be adopted by public business entities in annual periods beginning on or after December 15, 2015 and interim periods within those annual periods. The Company adopted this standard in the first quarter of fiscal year 2016 and it did not have a material impact on our financial statements as of and for the quarter and six months ended June 30, 2016. The Company has stock options with a performance based vesting condition, which if achieved would result in the recognition of $193 in stock compensation expense in the period vested. In August 2014, the FASB issued ASU No. 2014 ‑15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern. ASU 2014 ‑15 requires management to evaluate, at each annual or interim reporting period, whether there are conditions or events that exist that raise substantial doubt about an entity’s ability to continue as a going concern within one year after the date the financial statements are issued and provide related disclosures. ASU 2014 ‑15 is effective for annual periods ending after December 15, 2016 and earlier application is permitted. The adoption of ASU 2014 ‑15 is not expected to have a material effect on the Company’s financial statements or disclosures. In July 2015, the FASB issued ASU 2015-11, Simplifying the Measurement of Inventory , or ASU 2015-11. ASU 2015-11 applies to all inventory, except for inventory measured using the last-in, first-out method or the retail inventory method. The guidance allows an entity to measure inventory at the lower of cost and net realizable value. Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. The amendments in ASU 2015-11 are effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years, and may be applied prospectively with earlier adoption permitted. As the Company is in the early stages of commercialization of Xtampza, the Company has adopted ASU 2015-11 upon the initial capitalization of inventory. In November 2015, the FASB issued ASU 2015-17, Income Taxes: Balance Sheet Classification of Deferred Taxes (Topic 740) . ASU 2015-17 simplifies the presentation of deferred income taxes by eliminating the separate classification of deferred income tax assets and liabilities into current and noncurrent amounts in the consolidated balance sheet statement of financial position. The amendments in the update require that all deferred tax assets and liabilities be classified as noncurrent in the consolidated balance sheet. The amendments in this update are effective for annual periods beginning after December 15, 2017, and interim periods therein and may be applied either prospectively or retrospectively to all periods presented. Early adoption is permitted. The Company is currently evaluating its effect on the Company’s consolidated financial statements. In February 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2016-02, Leases (Topic 842) . The ASU requires lessees to put most leases on their balance sheets as a liability for the obligation to make lease payments and as a right-of-use asset, but recognize expenses on the income statements in a manner similar to today’s accounting. The guidance also eliminates the current real estate-specific provisions for all entities. For calendar-year public entities, the guidance becomes effective in 2019 and interim periods within that year. Early adoption is permitted for all entities. The Company has not chosen early adoption for this ASU and is currently evaluating its effect on the Company’s consolidated financial statements In March 2016, the Financial Accounting Standards Board, or FASB, issued Accounting Standard Update, or ASU, 2016-09, Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting , or ASU 2016-09. ASU 2016-09 intends to simplify various aspects of how share-based payments are accounted for and presented in the financial statements. The main provisions include: all tax effects related to stock awards will now be recorded through the statement of operations instead of through equity, all tax-related cash flows resulting from stock awards will be reported as operating activities on the cash flow statement, and entities can make an accounting policy election to either estimate forfeitures or account for forfeitures as they occur. The amendments in ASU 2016-09 are effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years, and may be applied prospectively with earlier adoption permitted. The Company is currently evaluating the impact of this guidance on its consolidated financial statements. |
Earnings (Loss) per Common Sh19
Earnings (Loss) per Common Share (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Earnings (Loss) per Common Share | |
Schedule of computations of basic and diluted net loss per share | Three months ended Six months ended June 30, June 30, 2016 2015 2016 2015 Net loss $ $ $ $ Extinguishment of preferred stock - see note 9 — — — Accretion of prior preferred stock — — — Accretion and dividends of series D preferred stock — — Loss attributable to common shareholders — basic and diluted $ $ $ $ Weighted-average number of common shares used in net loss per share - basic and diluted (Loss) earnings per share - basic $ $ $ $ |
Schedule of potentially dilutive securities excluded from computations of diluted weighted-average shares outstanding | Three months ended Six months ended June 30, June 30, 2016 2015 2016 2015 Outstanding stock options Warrants Redeemable convertible preferred stock — — — — Unvested restricted stock |
Fair Value of Financial Instr20
Fair Value of Financial Instruments (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Fair Value of Financial Instruments | |
Schedule of financial instruments measured at fair value by level within fair value hierarchy | Significant Quoted Prices other Significant in active observable unobservable markets inputs inputs Description Total (Level 1) (Level 2) (Level 3) June 30, 2016 Money market funds, included in cash equivalents $ $ $ — $ — December 31, 2015 Money market funds, included in cash equivalents $ $ $ — $ — |
Inventory (Tables)
Inventory (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | June 30, 2016 Raw materials $ Work in process — Finished goods Total inventory $ |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Accrued Expenses | |
Schedule of components of accrued expenses | June 30, 2016 December 31, 2015 Accrued bonuses and incentive compensation $ $ Accrued payroll and related benefits Accrued sales & marketing Accrued development costs Accrued other operating costs Accrued audit and legal Accrued interest Total accrued expenses $ $ |
Convertible Preferred Stock a23
Convertible Preferred Stock and Equity (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Convertible Preferred Stock and Equity | |
Summary of Changes in Shareholders' Equity | Additional Treasury Other Accumulated Total Common Stock Paid- In Stock, Comprehensive Deficit Shareholders’ Shares Amount Capital at cost Income Equity (Deficit) Balance, January 1, 2016 $ $ $ $ — $ $ Public offering of common stock, net of issuance costs of $526 — — — Stock-based compensation - — — — — Exercise of common stock options — — — — Net loss — — — — — Balance, June 30, 2016 $ $ $ $ — $ $ |
Stock-based Compensation (Table
Stock-based Compensation (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Stock-based Compensation | |
Summary of restricted stock awards | A summary of the Company’s restricted stock award (RSAs) activity for the six months ended June 30, 2016 and related information is as follows: Weighted average purchase price Shares per share Unvested at December 31, 2015 $ Granted — — Vested Unvested at June 30, 2016 (1) $ (1) Excludes 48,307 shares of unvested restricted stock remaining from the early exercise of stock options as of June 30, 2016. A summary of the Company’s restricted stock units (RSUs) activity for the six months ended June 30, 2016 and related information is as follows: Shares Average grant date fair value Outstanding at December 31, 2015 — $ — Granted Settled — — Forfeited — — Outstanding at June 30, 2016 $ |
Summary of stock option activity | Weighted- Weighted- average average remaining Aggregate exercise price contractual Intrinsic Shares per share term (years) Value Outstanding at December 31, 2015 $ $ Granted Exercised Cancelled Outstanding at June 30, 2016 $ $ Exercisable at June 30, 2016 $ $ Vested and expected to vest at June 30, 2016 $ $ |
Schedule of weighted-average assumptions used in Black-Scholes option-pricing model | Six months ended 2016 2015 Risk-free interest rate % % Volatility % % Expected term (years) Expected dividend yield - - |
Schedule of stock-based compensation for all stock options and restricted stock awards | Three months ended Six months ended June 30, June 30, 2016 2015 2016 2015 Research and development expenses $ $ $ $ Selling, general and administrative expenses Total stock-based compensation expense $ $ $ $ |
Nature of Business (Details)
Nature of Business (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Accumulated deficit | ||
Accumulated deficit | $ 169,180 | $ 129,008 |
Summary of Significant Accoun26
Summary of Significant Accounting Policies (Details) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||||
Jan. 31, 2016USD ($)$ / sharesshares | May 31, 2015USD ($)$ / sharesshares | Apr. 30, 2015 | Jun. 30, 2016USD ($) | Jun. 30, 2015USD ($) | Jun. 30, 2016USD ($) | Jun. 30, 2015USD ($) | |
Common stock sold (in shares) | shares | 2,750,000 | ||||||
Offering price (in dollars per share) | $ / shares | $ 20 | ||||||
Proceeds from the offering, after deducting underwriting discounts and commissions | $ 51,174 | ||||||
Number of shares of common stock into which convertible preferred stock was converted | shares | 12,591,456 | ||||||
Common stock split ratio | 0.144927536 | ||||||
Inventory capitalized | $ 1,214 | $ 1,214 | |||||
Advertising and product promotion costs | 4,680,000 | 7,006,000 | |||||
Stock compensation expense with a performance based vesting condition | $ 1,395 | $ 601 | 2,496 | $ 714 | |||
Performance Shares [Member] | |||||||
Stock compensation expense with a performance based vesting condition | $ 193 | ||||||
Conversion of redeemable convertible preferred stock into common stock | All series of convertible redeemable preferred stock | |||||||
Number of shares of common stock into which convertible preferred stock was converted | shares | 12,591,456 | ||||||
Initial public offering | |||||||
Common stock sold (in shares) | shares | 6,670,000 | ||||||
Offering price (in dollars per share) | $ / shares | $ 12 | ||||||
Proceeds from the offering, after deducting underwriting discounts and commissions | $ 72,029 | ||||||
Underwriters over-allotment option | |||||||
Common stock sold (in shares) | shares | 870,000 |
Earnings (Loss) per Common Sh27
Earnings (Loss) per Common Share - Computation of Earnings per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Net loss per common share | ||||
Net loss | $ (24,520) | $ (4,674) | $ (40,172) | $ (8,369) |
Extinguishment of preferred stock | 31,806 | |||
Accretion of prior preferred stock | (23,327) | |||
Loss attributable to common shareholders — basic and diluted | $ (24,520) | $ (5,315) | $ (40,172) | $ (1,135) |
Weighted-average number of common shares used in net loss per share-basic and diluted (in shares) | 23,417,378 | 11,791,546 | 23,273,765 | 6,426,431 |
(Loss) earnings per share - basic | $ (1.05) | $ (0.45) | $ (1.73) | $ (0.18) |
Series D convertible redeemable preferred stock | ||||
Net loss per common share | ||||
Accretion of prior preferred stock | $ (641) | $ (1,245) |
Earnings (Loss) per Common Sh28
Earnings (Loss) per Common Share - Summary of Potentially Dilutive Securities (Details) - shares | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Stock options | ||||
Anti-dilutive securities | ||||
Potentially dilutive securities excluded from the computations of diluted weighted-average shares outstanding | 2,290,112 | 1,086,789 | 2,290,112 | 1,086,789 |
Warrants | ||||
Anti-dilutive securities | ||||
Potentially dilutive securities excluded from the computations of diluted weighted-average shares outstanding | 2,445 | 2,445 | 2,445 | 2,445 |
Restricted Stock Award | ||||
Anti-dilutive securities | ||||
Potentially dilutive securities excluded from the computations of diluted weighted-average shares outstanding | 59,494 | 164,539 | 59,494 | 164,539 |
Fair Value of Financial Instr29
Fair Value of Financial Instruments (Details) - Estimate of fair value - Recurring - Money market funds - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Cash equivalents | $ 89,883 | $ 94,912 |
Quoted Prices in active markets (Level 1) | ||
Cash equivalents | $ 89,883 | $ 94,912 |
Inventory (Details)
Inventory (Details) $ in Thousands | Jun. 30, 2016USD ($) |
Inventory Disclosure [Abstract] | |
Raw materials | $ 46 |
Finished goods | 1,168 |
Total inventory | $ 1,214 |
Intangible Asset (Details)
Intangible Asset (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2016USD ($) | |
Intangible Assets, Gross (Excluding Goodwill) [Abstract] | |
Upfront payment to develop, manufacture, and commercialize ONSOLIS | $ 2,500 |
Maximum reimbursement amout for out-of-pocket expenses | $ 2,000 |
Accrued Expenses (Details)
Accrued Expenses (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 |
Accrued Expenses | ||
Accrued bonuses and incentive compensation | $ 2,281 | $ 1,474 |
Accrued payroll and related benefits | 991 | 93 |
Accrued marketing | 1,064 | 157 |
Accrued development costs | 750 | 80 |
Accrued other operating costs | 242 | 186 |
Accrued audit and legal | 185 | 209 |
Accrued interest | 23 | 29 |
Total accrued expenses | $ 5,536 | $ 2,228 |
Convertible Bridge Note with 33
Convertible Bridge Note with Related Party (Details) - USD ($) $ in Thousands | 2 Months Ended | 6 Months Ended |
Dec. 31, 2014 | Jun. 30, 2015 | |
Related party transactions | ||
Gain on extinguishment | $ 91 | |
6.0% Convertible promissory notes | ||
Related party transactions | ||
Gain on extinguishment | $ 91 | |
Bridge Notes Purchase Agreement | Investors | 6.0% Convertible promissory notes | ||
Related party transactions | ||
Amount issued | $ 5,000 | |
Stated interest rate | 6.00% |
Convertible Preferred Stock a34
Convertible Preferred Stock and Equity - Narrative (Details) - USD ($) $ in Thousands | 1 Months Ended | 2 Months Ended | 6 Months Ended | |||
Jan. 31, 2016 | May 31, 2015 | Mar. 31, 2015 | Feb. 28, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Preferred stock | ||||||
Common stock sold (in shares) | 2,750,000 | |||||
Aggregate consideration | $ 51,174 | |||||
Accruals of dividends and accretion to redemption value | $ 24,572 | |||||
Gain on extinguishment for amendment to dividend terms | $ 31,806 | |||||
Number of shares of common stock into which convertible preferred stock was converted | 12,591,456 | |||||
6.0% Convertible promissory notes | ||||||
Preferred stock | ||||||
Principal amount converted | $ 5,000 | |||||
Series D convertible redeemable preferred stock | ||||||
Preferred stock | ||||||
Common stock sold (in shares) | 41,666,667 | |||||
Aggregate consideration | $ 50,000 | |||||
Cash consideration from issuance of preferred stock | 45,000 | |||||
Series A convertible redeemable preferred stock | ||||||
Preferred stock | ||||||
Dividend rate (as a percent) | 4.50% | |||||
Series B convertible redeemable preferred stock | ||||||
Preferred stock | ||||||
Dividend rate (as a percent) | 8.00% | |||||
Series C convertible redeemable preferred stock | ||||||
Preferred stock | ||||||
Dividend rate (as a percent) | 8.00% | |||||
Series A, Series B and Series C convertible redeemable preferred stock | ||||||
Preferred stock | ||||||
Accrued dividends | $ 622 | |||||
Gain on extinguishment for amendment to dividend terms | 31,806 | |||||
Series A, Series B and Series C convertible redeemable preferred stock | Mandatory conversion, initial public offering | Minimum | ||||||
Preferred stock | ||||||
Gross proceeds from sale of stock | $ 50,000 | |||||
All series of convertible redeemable preferred stock | Conversion of redeemable convertible preferred stock into common stock | ||||||
Preferred stock | ||||||
Number of shares of common stock into which convertible preferred stock was converted | 12,591,456 |
Convertible Preferred Stock a35
Convertible Preferred Stock and Equity - Changes in Shareholders' Equity (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||
Jan. 31, 2016 | Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Balance at beginning of period | $ 85,072 | $ 85,072 | |||
Public offering of common stock, net of issuance costs of $526 | 51,174 | ||||
Public offering of common stock, net of issuance costs of $526, shares | 2,750,000 | ||||
Stock-based compensation expense | 2,496 | ||||
Exercise of common stock options | $ 86 | ||||
Exercise of common stock options, shares | 38,768 | ||||
Net loss | $ (24,520) | $ (4,674) | $ (40,172) | $ (8,369) | |
Balance at end of period | 98,656 | 98,656 | |||
Stock issuance costs | 526 | ||||
Common Stock | |||||
Balance at beginning of period | $ 21 | $ 21 | |||
Balance at beginning of period, shares | 20,739,351 | 20,739,351 | |||
Public offering of common stock, net of issuance costs of $526 | $ 3 | ||||
Public offering of common stock, net of issuance costs of $526, shares | 2,750,000 | ||||
Exercise of common stock options, shares | 38,768 | ||||
Balance at end of period | $ 24 | $ 24 | |||
Balance at end of period, shares | 23,528,119 | 23,528,119 | |||
Additional Paid-In Capital | |||||
Balance at beginning of period | $ 214,062 | $ 214,062 | |||
Public offering of common stock, net of issuance costs of $526 | 51,171 | ||||
Stock-based compensation expense | 2,496 | ||||
Exercise of common stock options | 86 | ||||
Balance at end of period | $ 267,815 | 267,815 | |||
Treasury Stock, at cost | |||||
Balance at beginning of period | (3) | (3) | |||
Balance at end of period | (3) | (3) | |||
Accumulated Deficit | |||||
Balance at beginning of period | $ (129,008) | (129,008) | |||
Net loss | (40,172) | ||||
Balance at end of period | $ (169,180) | $ (169,180) |
Stock-based Compensation - Summ
Stock-based Compensation - Summary of Restricted Stock Award Activity (Details) - shares | 6 Months Ended | |
Jun. 30, 2016 | Dec. 31, 2015 | |
Stock-based compensation | ||
Shares of common stock authorized for issuance outstanding (in shares) | 2,290,112 | 1,452,149 |
2014 Stock Incentive Plan | ||
Stock-based compensation | ||
Shares of common stock authorized for issuance (in shares) | 2,700,000 | |
Increase in number of authorized shares on the first day of each fiscal year, as a percentage of outstanding common stock (as a percent) | 4.00% | |
Vesting period | 4 years | |
Contractual life | 10 years | |
2014 Stock Incentive Plan | Minimum | ||
Stock-based compensation | ||
Period following termination date vested options are exercisable | 1 month | |
2014 Stock Incentive Plan | Maximum | ||
Stock-based compensation | ||
Period following termination date vested options are exercisable | 3 months |
Stock-based Compensation - Su37
Stock-based Compensation - Summary of Restricted Stock Units (RSUs) Activity (Details) | 6 Months Ended |
Jun. 30, 2016$ / sharesshares | |
Restricted Stock Award | |
Restricted stock awards | |
Balance at beginning of year (in shares) | 75,718 |
Vested (in shares) | (16,224) |
Balance at end of year (in shares) | 59,494 |
Unvested remaining from the early exercise of stock options (in shares) | 48,307 |
Weighted-average purchase price per share | |
Balance at beginning of year (in dollars per share) | $ / shares | $ 5.73 |
Vested (in dollars per share) | $ / shares | 5.73 |
Balance at end of year (in dollars per share) | $ / shares | $ 5.73 |
Restricted Stock Units (RSUs) | |
Restricted stock awards | |
Balance at beginning of year (in shares) | |
Granted (in shares) | 41,739 |
Vested (in shares) | |
Forfeited (in shares) | |
Balance at end of year (in shares) | 41,739 |
Weighted-average purchase price per share | |
Balance at beginning of year (in dollars per share) | $ / shares | |
Granted (in dollars per share) | $ / shares | 16.15 |
Vested (in dollars per share) | $ / shares | |
Forfeited | $ / shares | |
Balance at end of year (in dollars per share) | $ / shares | $ 16.15 |
Stock-based Compensation - Su38
Stock-based Compensation - Summary of Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2016 | Dec. 31, 2015 | |
Stock option activity | ||
Outstanding at beginning of year (in shares) | 1,452,149 | |
Granted (in shares) | 924,981 | |
Exercised (in shares) | (38,768) | |
Cancelled (in shares) | (48,250) | |
Outstanding at end of period (in shares) | 2,290,112 | 1,452,149 |
Exercisable at end of period (in shares) | 383,239 | |
Vested and expected to vest at end of period (in shares) | 2,262,479 | |
Weighted average exercise price per share | ||
Outstanding at beginning of year (in dollars per share) | $ 10.37 | |
Granted (in dollars per share) | 16.60 | |
Exercised (in dollars per share) | 2.22 | |
Cancelled (in dollars per share) | 16.07 | |
Outstanding at end of period (in dollars per share) | 12.90 | $ 10.37 |
Exercisable at end of period (in dollars per share) | 7.54 | |
Vested and expected to vest at end of period (in dollars per share) | $ 12.96 | |
Stock option activity, additional information | ||
Outstanding Weighted-average remaining contractual term | 9 years 1 month 6 days | 10 years 4 months 24 days |
Exercisable at end of period, Weighted-average remaining contractual term | 8 years 2 months 12 days | |
Vested and expected to vest at end of period, Weighted-average remaining contractual term | 9 years 1 month 6 days | |
Outstanding Aggregate Intrinsic Value | $ 5,208 | $ 24,887 |
Exercisable at end of period, Aggregate Intrinsic Value | 2,135 | |
Vested and expected to vest at end of period, Aggregate Intrinsic Value | 5,339 | |
Stock options | ||
Stock option activity, additional information | ||
Unrecognized compensation cost related to outstanding options | $ 17,483 | |
Period over which unrecognized compensation cost is expected to be recognized as expense | 3 years 2 months 12 days |
Stock-based Compensation - Su39
Stock-based Compensation - Summary of Valuation Assumptions Used (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Weighted-average assumptions used in the Black-Scholes option pricing model to determine the fair value of the employee stock option grants | ||||
Risk-free interest rate | 1.50% | 1.70% | ||
Volatility | 77.00% | 77.00% | ||
Expected term (in years) | 6 years 7 days | 6 years 3 months | ||
Dividend yield | ||||
Total stock-based compensation expense | $ 1,395 | $ 601 | $ 2,496 | $ 714 |
Research and development | ||||
Weighted-average assumptions used in the Black-Scholes option pricing model to determine the fair value of the employee stock option grants | ||||
Total stock-based compensation expense | 165 | 55 | 303 | 76 |
General and administrative | ||||
Weighted-average assumptions used in the Black-Scholes option pricing model to determine the fair value of the employee stock option grants | ||||
Total stock-based compensation expense | $ 1,230 | $ 546 | $ 2,193 | $ 638 |
Commitments and Contingencies (
Commitments and Contingencies (Details) | 6 Months Ended |
Jun. 30, 2016patent | |
Purdue Pharma, L. P. patent infringement suits | |
Contingencies | |
Total number of Orange Book patents asserted to have been infringed previously invalidated in a suit against another company | 3 |
Total number of no stay patents asserted to have been infringed | 2 |
Purdue Pharma, L. P. patent infringement suits | Maximum | |
Contingencies | |
Stay period before FDA can issue a final approval unless it is terminated | 30 months |
Purdue Pharma, L. P. patent infringement suit, District of Delaware | |
Contingencies | |
Total number of Orange Book patents asserted to have been infringed | 3 |
Total number of non-Orange Book patents asserted to have been infringed | 1 |
Purdue Pharma, L. P. patent infringement suit, District of Massachusetts | |
Contingencies | |
Total number of patents asserted to have been infringed | 4 |