Document_and_Entity_Informatio
Document and Entity Information | 6 Months Ended | |
Jun. 30, 2014 | Aug. 11, 2014 | |
Document and Entity Information | ' | ' |
Entity Registrant Name | 'NephroGenex, Inc. | ' |
Entity Central Index Key | '0001338095 | ' |
Document Type | '10-Q | ' |
Document Period End Date | 30-Jun-14 | ' |
Amendment Flag | 'false | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Current Reporting Status | 'Yes | ' |
Entity Filer Category | 'Smaller Reporting Company | ' |
Entity Common Stock, Shares Outstanding | ' | 8,855,114 |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q2 | ' |
Balance_Sheets
Balance Sheets (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
Current assets | ' | ' |
Cash and cash equivalents | $11,619,000 | $2,132,000 |
Short-term investments | 18,267,000 | 0 |
Prepaid expenses and other assets | 444,000 | 12,000 |
Total current assets | 30,330,000 | 2,144,000 |
Property and equipment, net | 11,000 | 11,000 |
Deferred initial public offering costs | 0 | 461,000 |
Other assets | 173,000 | 4,000 |
Total assets | 30,514,000 | 2,620,000 |
Current liabilities | ' | ' |
Accounts payable | 927,000 | 48,000 |
Accrued and other liabilities | 1,191,000 | 1,858,000 |
Preferred stock warrant liability | 0 | 6,983,000 |
Convertible notes payable | 0 | 7,917,000 |
Total current liabilities | 2,118,000 | 16,806,000 |
Stockholders’ equity (deficit) | ' | ' |
Series A preferred stock: $.001 par value; 32,690,676 shares authorized; 0 and 23,688,396 shares issued and outstanding as of June 30, 2014 and December 31, 2013, respectively | 0 | 0 |
Common stock; $.001 par value; 100,000,000 shares authorized; 8,855,114 and 319,882 shares issued and outstanding as of June 30, 2014 and December 31, 2013, respectively | 9,000 | 0 |
Additional paid-in capital | 76,546,000 | 26,789,000 |
Accumulated other comprehensive loss | -37,000 | 0 |
Accumulated deficit | -48,122,000 | -40,999,000 |
Total stockholders’ equity (deficit) | 28,396,000 | -14,186,000 |
Total liabilities and stockholders’ equity (deficit) | 30,514,000 | 2,620,000 |
Series A Preferred Stock | ' | ' |
Stockholders’ equity (deficit) | ' | ' |
Series A preferred stock: $.001 par value; 32,690,676 shares authorized; 0 and 23,688,396 shares issued and outstanding as of June 30, 2014 and December 31, 2013, respectively | $0 | $24,000 |
Balance_Sheets_Parenthetical
Balance Sheets (Parenthetical) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
Common stock, par value (in dollars per share) | $0.00 | $0.00 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 8,855,114 | 319,882 |
Common stock, shares outstanding | 8,855,114 | 319,882 |
Preferred stock, par value (in dollars per share) | $0.00 | ' |
Preferred stock, shares authorized | 5,000,000 | ' |
Preferred stock, shares issued | 0 | ' |
Preferred stock, shares outstanding | 0 | ' |
Series A Preferred Stock | ' | ' |
Preferred stock, par value (in dollars per share) | $0.00 | $0.00 |
Preferred stock, shares authorized | 32,690,676 | 32,690,676 |
Preferred stock, shares issued | 0 | 23,688,396 |
Preferred stock, shares outstanding | 0 | 23,688,396 |
Statements_of_Comprehensive_Lo
Statements of Comprehensive Loss (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 |
Expenses: | ' | ' | ' | ' |
Research and development | $3,875 | $221 | $4,332 | $485 |
General and administrative | 1,560 | 154 | 2,595 | 292 |
Total expenses | 5,435 | 375 | 6,927 | 777 |
Loss from operations | -5,435 | -375 | -6,927 | -777 |
Other income (expense): | ' | ' | ' | ' |
Change in value of preferred stock warrants | 0 | -341 | -140 | -341 |
Interest expense | 0 | -87 | -78 | -158 |
Interest income | 12 | 0 | 22 | 0 |
Net loss | -5,423 | -803 | -7,123 | -1,276 |
Net loss per share - basic and diluted (in dollars per share) | ($0.61) | ($2.51) | ($1.06) | ($3.99) |
Weighted average shares outstanding - basic and diluted (in shares) | 8,855,114 | 319,882 | 6,733,095 | 319,882 |
Other comprehensive loss: | ' | ' | ' | ' |
Unrealized loss on short-term investments | -37 | 0 | -37 | 0 |
Comprehensive loss | ($5,460) | ($803) | ($7,160) | ($1,276) |
Statement_of_Stockholders_Equi
Statement of Stockholders' Equity (Deficiency) (USD $) | Total | Preferred Stock | Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Income (Loss) | Accumulated Deficit |
In Thousands, except Share data, unless otherwise specified | ||||||
Balance at Dec. 31, 2013 | ($14,186) | $24 | $0 | $26,789 | $0 | ($40,999) |
Balance (in shares) at Dec. 31, 2013 | ' | 23,688,396 | 319,882 | ' | ' | ' |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ' | ' | ' | ' | ' | ' |
Issuance of common stock at IPO, net of expenses of $3,767,348 (unaudited) (in shares) | ' | ' | 3,100,000 | ' | ' | ' |
Issuance of common stock at IPO, net of expenses of $3,767,348 (unaudited) | 33,433 | ' | 3 | 33,430 | ' | ' |
Issuance of common stock for preferred stock warrant (unaudited) (in shares) | ' | ' | 593,589 | ' | ' | ' |
Issuance of common stock for preferred stock warrant (unaudited) | 7,124 | ' | 1 | 7,123 | ' | ' |
Issuance of common stock for convertible notes and accrued interest (unaudited) (in shares) | ' | ' | 1,197,289 | ' | ' | ' |
Issuance of common stock for convertible notes and accrued interest (unaudited) | 8,645 | ' | 1 | 8,644 | ' | ' |
Issuance of common stock for preferred stock (unaudited) (in shares) | ' | -23,688,396 | 3,644,354 | ' | ' | ' |
Issuance of common stock for preferred stock (unaudited) | ' | -24 | 4 | 20 | ' | ' |
Stock based compensation (unaudited) | 540 | ' | ' | 540 | ' | ' |
Other comprehensive loss (unaudited) | -37 | ' | ' | ' | -37 | ' |
Net loss | -7,123 | ' | ' | ' | ' | -7,123 |
Balance at Jun. 30, 2014 | $28,396 | $0 | $9 | $76,546 | ($37) | ($48,122) |
Balance (in shares) at Jun. 30, 2014 | ' | 0 | 8,855,114 | ' | ' | ' |
Statement_of_Stockholders_Defi
Statement of Stockholders' Deficiency (Parenthetical) (USD $) | 3 Months Ended | 7 Months Ended |
Mar. 31, 2014 | Dec. 31, 2004 | |
Statement of Stockholders' Equity [Abstract] | ' | ' |
Sale of common stock for cash in May 2004 (in dollars per share) | ' | $0.05 |
Issuance of common stock at IPO, expenses | $3,767,348 | ' |
Statements_of_Cash_Flows
Statements of Cash Flows (USD $) | 6 Months Ended | |
In Thousands, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 |
Operating activities | ' | ' |
Net loss | ($7,123) | ($1,276) |
Adjustments to reconcile net loss to net cash and cash equivalents used in operating activities | ' | ' |
Depreciation and amortization | 1 | 3 |
Change in fair value of preferred stock warrants | 140 | 341 |
Non-cash interest expense | 78 | 158 |
Accretion of premium on investment activities | 12 | 0 |
Accrued interest receivable | 1 | 0 |
Stock based compensation expense | 540 | 48 |
Changes in operating assets and liabilities | ' | ' |
Prepaid expenses and other assets | -601 | 18 |
Accounts payable, accrued and other liabilities | 1,294 | -668 |
Net cash and cash equivalents used in operating activities | -5,658 | -1,376 |
Investing activities | ' | ' |
Purchases of investments | -18,316 | 0 |
Property and equipment purchases | -2 | 0 |
Net cash and cash equivalents used in investing activities | -18,318 | 0 |
Financing activities | ' | ' |
Proceeds from issuance of convertible notes payable | 0 | 1,262 |
Payment of initial public offering costs | -3,737 | 0 |
Proceeds from issuance of common stock | 37,200 | 0 |
Net cash and cash equivalents provided by financing activities | 33,463 | 1,262 |
Net increase (decrease) in cash and cash equivalents | 9,487 | -114 |
Cash and cash equivalents at beginning of period | 2,132 | 324 |
Cash and cash equivalents at end of period | 11,619 | 210 |
Supplemental disclosure of noncash financing activities | ' | ' |
Conversion of convertible notes payable, accrued interest, preferred stock and warrants into common stock | $15,792 | $0 |
The_Company
The Company | 6 Months Ended |
Jun. 30, 2014 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' |
The Company | ' |
The Company | |
NephroGenex, Inc. (the “Company”) was incorporated in Delaware on May 25, 2004. The Company is a drug development company focused on developing novel therapies for kidney disease. The Company acquired commercial rights to Pyridorin™ and has initiated a Phase 3 clinical study in patients with diabetic nephropathy. | |
The Company’s primary efforts to date have been devoted to raising capital, recruiting senior management and staff and conducting research and development activities. The Company has experienced net losses since its inception and, as of June 30, 2014, has an accumulated deficit of $48.1 million. | |
The Company currently has no commercially approved products and has recognized no revenue since its inception in 2004. We do not expect to generate revenue from product sales unless and until we successfully complete development and obtain marketing approval for one or more of our product candidates, which we expect will take a number of years and is subject to significant uncertainty. Developing and commercializing a product requires significant time and capital and is subject to regulatory review and approval. There can be no assurance that the Company’s current products in development, if approved, will be successfully commercialized due to a variety of factors, including competition from other biotechnology and pharmaceutical companies |
Significant_Accounting_Policie
Significant Accounting Policies | 6 Months Ended | ||||||||||||
Jun. 30, 2014 | |||||||||||||
Accounting Policies [Abstract] | ' | ||||||||||||
Significant Accounting Policies | ' | ||||||||||||
Significant Accounting Policies | |||||||||||||
Basis of Presentation | |||||||||||||
The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). | |||||||||||||
Unaudited Interim Financial Information | |||||||||||||
The accompanying interim financial statements and related disclosures are unaudited, have been prepared on the same basis as the annual financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary for a fair statement of the results of operations for the periods presented. The year-end balance sheet was derived from audited financial statements, but does not include all disclosures required by U.S. GAAP. The results of operations for any interim period are not necessarily indicative of the results to be expected for the full year or for any other future year or interim period. | |||||||||||||
Use of Estimates | |||||||||||||
The preparation of financial statements in conformity with U.S. 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. Actual results could differ from those estimates. | |||||||||||||
Reverse Stock Split | |||||||||||||
On February 6, 2014, the Company effected a 1-for-6.5 reverse stock split of its issued and outstanding shares of common stock and a proportional adjustment to the conversion ratio for the Company’s outstanding Series A Preferred Stock. Accordingly, all share and per share amounts for all periods presented in these financial statements and notes thereto have been adjusted retroactively, where applicable, to reflect the reverse stock split and adjustment of the preferred share conversion ratios. | |||||||||||||
Initial Public Offering | |||||||||||||
On February 14, 2014, the Company completed its initial public offering of common stock (the “IPO”) pursuant to a registration statement that was declared effective on February 10, 2014. The Company sold 3,100,000 shares of its common stock, at a price of $12.00. The Company raised a total of $33.4 million in net proceeds after deducting underwriting discounts and commissions and offering expenses of approximately $3.8 million. Costs directly associated with the IPO were capitalized and recorded as deferred IPO costs prior to the closing of the IPO. These costs were recorded as a reduction of the proceeds received in arriving at the amount to be recorded as additional paid-in capital. | |||||||||||||
Upon completion of the IPO, 3,644,354 shares of common stock were issued for the conversion of all outstanding shares of Series A Preferred stock, 1,197,289 shares of common stock were issued for the conversion of outstanding convertible notes and accrued interest and 593,589 aggregate shares of common stock were issued in connection with the settlement of the Company’s outstanding preferred stock warrant liability. | |||||||||||||
Warrant Liability | |||||||||||||
Certain warrants to purchase the Company’s capital stock had historically been classified as liabilities and were recorded at estimated fair value. At each reporting period, any change in fair value of the freestanding warrants was recorded as other (expense) income. The preferred stock warrant liability was settled upon the closing of the IPO. | |||||||||||||
Cash and Cash Equivalents | |||||||||||||
The Company considers all highly liquid investments with original maturities of three months or less to be cash equivalents. | |||||||||||||
Investments | |||||||||||||
The Company invests in money market funds and certificates of deposits and considers all investments purchased with a maturity date greater than three months and less than one year to be short-term investments. Those investments with a maturity date greater than one year at each balance sheet date are considered to be long-term investments. As of June 30, 2014, all investments were classified as available-for-sale. These investments are carried at estimated fair value with unrealized gains and losses included in stockholders' equity (deficit). The amortized cost of debt securities is adjusted for amortization of premiums and accretion of discounts to maturity, which is included in interest income. | |||||||||||||
Concentration of Credit Risk | |||||||||||||
The Company invests its available cash balances in bank deposits, money market funds and certificates of deposit. The Company maintains deposits in federally insured financial institutions in excess of federally insured limits. Management believes that the Company is not exposed to significant credit risk due to the financial position of the depository institutions in which those deposits are held. Additionally, the Company has established guidelines regarding approved investments and maturities of investments, which are designed to maintain safety and liquidity. | |||||||||||||
Property and Equipment | |||||||||||||
Property and equipment consists of furniture, fixtures and computers. Property and equipment are carried at cost less accumulated depreciation. Depreciation is calculated using the straight-line method over the respective asset’s useful life. Maintenance and repairs that do not improve or extend the life of assets are expensed as incurred. When an asset is retired or disposed of, the cost and related accumulated depreciation are removed from the accounts and any resulting gains or losses are reflected within the statement of operations. | |||||||||||||
Fair Value of Financial Instruments | |||||||||||||
As of June 30, 2014, financial instruments consist of cash and cash equivalents, short-term investments, accounts receivable and accounts payable. | |||||||||||||
The Company defines fair value (“FV”) as the price that would be received to sell an asset or paid to transfer a liability ("the exit price") in an orderly transaction between market participants at the measurement date. The FV hierarchy for inputs maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. The Company uses the following hierarchy of inputs to measure FV: | |||||||||||||
•Level 1: Quoted prices in active markets for identical assets or liabilities; | |||||||||||||
• | Level 2: Inputs, other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and | ||||||||||||
• | Level 3: Unobservable inputs that are supported by little or no market activity, which require the reporting entity to develop its own assumptions. | ||||||||||||
The Company values investments using the most observable inputs available that are current as of the measurement date and classifies them according to the lowest level of inputs used. Observable inputs are inputs that market participants would use in pricing the asset or liability developed from market data obtained from independent sources. Unobservable inputs are inputs that reflect the Company’s judgment concerning the assumptions that market participants would use in pricing the asset or liability developed from the best information available under the circumstances. | |||||||||||||
The Company targets investment principally in Level 1 and Level 2 cash equivalents and financial instruments and records them at FV. The Company did not rely on Level 3 inputs for the valuation of any investments at June 30, 2014. The Company expects that the carrying values of cash equivalents will approximate FV because of their short maturities. | |||||||||||||
The Company classifies as Level 2 investments in certificates of deposits and values them using the market approach based on significant other observable inputs including quoted prices in active markets for instruments that are similar or quoted prices in markets that are not traded on a daily basis for identical or similar instruments. | |||||||||||||
The following table sets forth our financial instruments carried at FV within the ASC 820 hierarchy and using the lowest level of input as of June 30, 2014: | |||||||||||||
Quoted Prices | |||||||||||||
in Active | Significant | ||||||||||||
(in thousands) | Markets | Other | Significant | ||||||||||
Balance | For Identical Assets | Observable Inputs | Unobservable Inputs | ||||||||||
Assets: | 30-Jun-14 | Level 1 | Level 2 | Level 3 | |||||||||
Money Market Funds | $ | 10,812 | $ | 10,812 | $ | — | $ | — | |||||
Certificates of Deposit | 19,047 | — | 19,047 | — | |||||||||
$ | 29,859 | $ | 10,812 | $ | 19,047 | $ | — | ||||||
The Company believes the fair value of convertible notes payable approximates its carrying value as of December 31, 2013. | |||||||||||||
At December 31, 2013, certain warrants to purchase the Company’s capital stock were classified as liabilities and were recorded at estimated FV. The Company measured its warrant liability using significant unobservable inputs that were based on little or no verifiable market data, which is Level 3 in the FV hierarchy. At each reporting period, any change in fair value of the freestanding warrants was recorded as other (expense) income. The preferred stock warrant liability was settled upon closing of the IPO. | |||||||||||||
Research and Development Costs | |||||||||||||
Research and development costs are expensed as incurred. Research and development expenses include personnel costs associated with research and development activities including non-cash share-based compensation, costs for third-party contractors to perform research, conduct clinical trials and manufacture drug supplies and materials. The Company accrues for costs incurred by external service providers, including contract research organizations and clinical investigators, based on its estimates of service performed and costs incurred. These estimates include the level of services performed by the third parties, patient enrollment in clinical trials, administrative costs incurred by the third parties, and other indicators of the services completed. Based on the timing of amounts invoiced by service providers, the Company may also record payments made to those providers as prepaid expenses that will be recognized as expense in future periods as the related services are rendered. | |||||||||||||
Stock-Based Compensation | |||||||||||||
The Company estimates the FV of stock options and stock purchase rights using a Black-Scholes option valuation model which require the input of highly subjective assumptions, including the option’s expected life and the price volatility of the underlying stock. The Company uses the simplified method for estimating the expected term as provided by the Securities and Exchange Commission. The simplified method calculates the expected term as the average time-to-vesting and the contractual life of the options. The expected stock price volatility assumption was determined by examining the historical volatilities of a group of industry peers. The FV of each option grant is estimated on the date of grant using the Black-Scholes option valuation model, and the resulting FV is expensed using the straight-line attribution method over the vesting period, which is the same as the requisite service period. Restricted stock units are measured at the FV of the Company's common stock on the date of grant and expensed over the period of vesting, which is the same as the requisite service period using the straight-line attribution method. | |||||||||||||
Recent Accounting Pronouncements | |||||||||||||
Occasionally, new accounting standards are issued or proposed by the Financial Accounting Standards Board (the “FASB”), or other standards-setting bodies that the Company adopts by the effective date specified within the standard. Unless otherwise discussed, standards that do not require adoption until a future date are not expected to have a material impact on the Company’s financial statements upon adoption. | |||||||||||||
In February 2013, the FASB issued a final rule related to the reporting of amounts reclassified out of accumulated other comprehensive income that requires entities to report, either on their income statement or in a footnote to their financial statements, the effects on earnings from items that are reclassified out of other comprehensive income. The new accounting rule was effective for the Company in the first quarter of 2013. The adoption of the new accounting rule did not have a material effect on the Company’s financial condition, results of operations or cash flows. The Company chose to present the total of comprehensive income, the components of net income, and the components of other comprehensive income in a single continuous statement of operations and comprehensive income. | |||||||||||||
In July 2013, the FASB issued Accounting Standards Update, or ASU, No. 2013-11, Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists. ASU 2013-11 provides explicit guidance on the financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. The guidance is effective prospectively for fiscal years, and interim periods within those years, beginning after December 15, 2013, with an option for early adoption. The Company adopted this guidance on January 1, 2014. The adoption did not impact the Company’s financial position or results of operations. | |||||||||||||
In July 2014, the FASB issued ASU No. 2014-10, Development Stage Entities (Topic 915): Elimination of Certain Financial Reporting Requirements, Including an Amendment to Variable Interest Entities Guidance in Topic 810, Consolidation. The amendments in this ASU remove all incremental financial reporting requirements from U.S. GAAP for development stage entities, including the removal of Topic 915, Development Stage Entities, from the FASB Accounting Standards Codification™. A development stage entity is one that devotes substantially all of its efforts to establishing a new business and for which: (a) planned principal operations have not commenced; or (b) planned principal operations have commenced, but have produced no significant revenue. Current U.S. GAAP requires a development stage entity to present the same basic financial statements and apply the same recognition and measurement rules as established companies. In addition, U.S. GAAP requires a development stage entity to present inception-to-date information about income statement line items, cash flows, and equity transactions. For public business entities, the presentation and disclosure requirements in Topic 915 will no longer be required for the first annual period beginning after December 15, 2014. The revised consolidation standards are effective one year later, in annual periods beginning after December 15, 2015. Early adoption is permitted. The Company adopted the guidance for the quarterly periods ended June 30, 2014. The adoption did not impact the Company’s financial position or results of operations. |
Earnings_Per_Share
Earnings Per Share | 6 Months Ended | |||||||||||||
Jun. 30, 2014 | ||||||||||||||
Earnings Per Share [Abstract] | ' | |||||||||||||
Earnings Per Share | ' | |||||||||||||
Earnings Per Share | ||||||||||||||
Basic net loss per share is calculated by dividing the net loss by the weighted average number of shares of the Company’s common stock outstanding for the period, without consideration for common stock equivalents. Diluted net loss per share is computed by dividing the net loss by the weighted average number of common share equivalents outstanding for the period determined using the treasury-stock method. Under the treasury-stock method earnings per share data is computed as if the common share equivalents were outstanding at the beginning of the period (or at the time of issuance, if later) and as if the funds obtained from exercise of the common stock equivalents were used to purchase common stock at the average market price during the period. If there is little or no market for the common stock, a reasonable estimate of FV shall be used. | ||||||||||||||
For purposes of this calculation, preferred stock, stock options, restricted stock units and warrants to purchase capital stock are considered to be common stock equivalents and are only included in the calculation of diluted net loss per share when their effect is dilutive. | ||||||||||||||
The following table sets forth the computation of basic and diluted net loss per share in thousands, except share and per share data: | ||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||
June 30, | June 30, | |||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||
Historical | ||||||||||||||
Numerator: | ||||||||||||||
Net loss | $ | (5,423 | ) | $ | (803 | ) | $ | (7,123 | ) | $ | (1,276 | ) | ||
Denominator: | ||||||||||||||
Weighted average common shares outstanding | 8,855,114 | 319,882 | 6,733,095 | 319,882 | ||||||||||
Net loss per share-basic and diluted | $ | (0.61 | ) | $ | (2.51 | ) | $ | (1.06 | ) | $ | (3.99 | ) | ||
Potentially dilutive securities not included in the calculation of diluted net loss per common share because to do so would be anti-dilutive are as follows (in common equivalent shares on a weighted-average basis): | ||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||
June 30, | June 30, | |||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||
Common stock options | 816,695 | 563,461 | 749,225 | 501,946 | ||||||||||
Restricted stock units | 24,000 | — | 24,000 | — | ||||||||||
Common stock warrants | 62,000 | — | 46,586 | — | ||||||||||
In addition to the potentially dilutive securities noted above, the Company has excluded from the table above 3,644,354 shares of common stock that were issued for the conversion of all outstanding shares of Series A Preferred stock, 1,197,289 shares of common stock that were issued for convertible notes and accrued interest and 593,589 aggregate shares of common stock that were issued in connection with the settlement of the Company’s outstanding warrant obligations upon closing of the IPO. |
Balance_Sheet_Items
Balance Sheet Items | 6 Months Ended | |||||||||||||
Jun. 30, 2014 | ||||||||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' | |||||||||||||
Balance Sheet Items | ' | |||||||||||||
Balance Sheet Items | ||||||||||||||
Investments | ||||||||||||||
The following table summarizes the Company's available for sale investments as of June 30, 2014 (in thousands); | ||||||||||||||
Maturity | Amortized | Unrealized | Unrealized | Estimated | ||||||||||
Short-term Investments | (in years) | Cost | Gains | Loss | Fair Value | |||||||||
Money Market | 1 or less | $ | — | $ | — | $ | — | $ | — | |||||
Certificates of Deposit | 1 or less | 18,304 | — | (37 | ) | 18,267 | ||||||||
Total Investments | $ | 18,304 | $ | — | $ | (37 | ) | $ | 18,267 | |||||
Accrued Liabilities | ||||||||||||||
Accrued liabilities were as follows (in thousands): | ||||||||||||||
June 30, | December 31, | |||||||||||||
2014 | 2013 | |||||||||||||
Accrued clinical trial expenses | $ | 567 | $ | 209 | ||||||||||
Accrued compensation | 496 | 365 | ||||||||||||
Interest | — | 650 | ||||||||||||
Other accruals | 128 | 634 | ||||||||||||
Total | $ | 1,191 | $ | 1,858 | ||||||||||
License_Agreements
License Agreements | 6 Months Ended |
Jun. 30, 2014 | |
License Agreements [Abstract] | ' |
License Agreements | ' |
License Agreements | |
The University of South Carolina Research Foundation, Corp. | |
During 2007, the Company licensed certain technology from the University of South Carolina Research Foundation, Corp. (“USCRF”) to the Company. The license gives the Company worldwide rights to use the technology as defined in the agreement. The agreement was amended in August 2013. The Company paid an annual licensing fee of $30,000 through 2008, $60,000 from 2009 through 2010, $62,000 from 2011 through 2012 and $122,000 in 2013. The Company is obligated to pay an annual licensing fee of $120,000 thereafter. Upon the achievement of certain defined product development milestones, the Company would be obligated to make up to $6.1 million of payments to USCRF. The Company will be obligated to pay USCRF a one-time fee of $35,000 upon execution of a sublicense and would pay to USCRF 25% of any non-royalty sublicense payments received from a sub-licensee. The term of the agreement expires on the expiration of the underlying USCRF patents. The Company can terminate the license at any time upon three months prior written notice to USCRF. As of June 30, 2014, no development milestones have been paid or accrued nor does the Company expect to achieve any development milestones during the next few years. The Company paid $30,000 and $60,000 for the three and six month periods ended June 30, 2014, respectively, for licensing fees due under this agreement and no licensing fees for the three and six months ended June 30, 2013. |
Convertible_Notes_Payable
Convertible Notes Payable | 6 Months Ended |
Jun. 30, 2014 | |
Debt Disclosure [Abstract] | ' |
Convertible Notes Payable | ' |
Convertible Notes Payable | |
On February 14, 2014, in connection with the closing of the Company’s IPO, $7.9 million of convertible promissory notes and accrued interest were converted into 1,197,289 shares of common stock. | |
The Company had accrued interest of approximately $0 and $650,000 as of June 30, 2014 and December 31, 2013, respectively, which is included in accrued and other liabilities on the accompanying balance sheets. Interest expense for the three and six months ended June 30, 2014 and the three and six months ended June 30, 2013 relating to the notes was approximately $0, $78,000 and $87,000 and $158,000, respectively. |
Stockholders_equity_deficit
Stockholders' equity (deficit) | 6 Months Ended | |||||||||||||
Jun. 30, 2014 | ||||||||||||||
Equity [Abstract] | ' | |||||||||||||
Stockholders' equity (deficit) | ' | |||||||||||||
Stockholders' equity (deficit) | ||||||||||||||
Series A Preferred Stock | ||||||||||||||
In connection with the completion of the IPO, 3,644,354 shares of common stock were issued for the conversion of all outstanding shares of the Company’s Series A Preferred stock. | ||||||||||||||
Warrants | ||||||||||||||
On January 16, 2014, an agreement was reached among the Company’s significant shareholders to cancel warrants held by its majority shareholder, Care Capital Investments III, LP, together with its affiliates (collectively, Care Capital), and by funds affiliated with Rho Venture Partners (Rho). Pursuant to this agreement, an aggregate of 593,589 shares of the Company’s common stock were issued to Care Capital and Rho concurrently with the completion of the Company’s IPO in return for cancelling the warrants. In connection with the cancellation of the warrants, the Company settled the preferred stock warrant liability on its balance sheet. | ||||||||||||||
On February 10, 2014, the Company, in connection with the IPO, issued the underwriter warrants to purchase up to 62,000 shares of common stock. The warrants are exercisable at any time commencing one year from the effective date of the Company’s IPO. The warrants are exercisable at a price of $15.00 per share and expire on February 10, 2018. | ||||||||||||||
Common Stock | ||||||||||||||
On February 14, 2014, the Company filed an Amended and Restated Certificate of Incorporation which authorizes the issuance of 100,000,000 shares of common stock, and 5,000,000 shares of undesignated preferred stock. | ||||||||||||||
Shares Reserved for Future Issuance | ||||||||||||||
The Company has reserved shares of its common stock for future issuance as of June 30, 2014 as follows: | ||||||||||||||
30-Jun-14 | ||||||||||||||
Stock options outstanding | 822,401 | |||||||||||||
Shares available for grant under stock option plans | 450,349 | |||||||||||||
Restricted stock units | 24,000 | |||||||||||||
Common stock warrants | 62,000 | |||||||||||||
Total shares reserved for future issuance | 1,358,750 | |||||||||||||
Stock Based Compensation | ||||||||||||||
In 2005, the Company adopted the NephroGenex, Inc. 2005 Stock Option Plan. On May 15, 2014, the 2005 Stock Option Plan, was amended and restated to the 2007 Equity Incentive Plan (the “Plan”). The amendment authorized an increase of 673,923 shares and provided for the granting of up to 1,283,226 shares of common stock to employees and consultants of the Company in the form of incentive and nonqualified stock options and shares of restricted stock. As of June 30, 2014 there were 450,349 shares available for issuance from the Plan. | ||||||||||||||
The table below summarizes stock option activity for the six months ended June 30, 2014. | ||||||||||||||
Number | Weighted | |||||||||||||
of Shares | Average | |||||||||||||
Exercise | ||||||||||||||
Price | ||||||||||||||
Outstanding as of December 31, 2013 | 563,453 | $ | 1.17 | |||||||||||
Granted | 258,948 | 10.06 | ||||||||||||
Exercised | — | — | ||||||||||||
Canceled | — | — | ||||||||||||
Outstanding as of June 30, 2014 | 822,401 | $ | 3.98 | |||||||||||
Exercisable as of June 30, 2014 | 530,151 | $ | 1.7 | |||||||||||
In November 2013, the Company issued 24,000 Restricted Stock Units (RSU) at an exercise price of $4.55 per share to its CEO in connection with his employment agreement. The RSU represent the right to receive shares of common stock, subject to the terms and conditions of a restricted stock unit agreement and grant notice and were not issued under the Plan. The RSU’s are subject to time based vesting with 25% of the RSU’s vesting on October 21, 2014 and the remaining 75% will vest in equal monthly installments on the 1st day of each calendar month beginning November 1, 2014. | ||||||||||||||
During the six months ended June 30, 2014, the Company’s Board of Directors granted 258,948 stock options to employees and Directors of the Company with a weighted average fair value of $8.66 per share. The weighted-average assumptions used in the Black-Scholes valuation model for equity awards granted during the six month period ended June 30, 2014 are shown in the table below. No options were issued during the six month period ended June 30, 2013. | ||||||||||||||
Six Months Ended | ||||||||||||||
30-Jun-14 | ||||||||||||||
Expected volatility | 80 | % | ||||||||||||
Expected dividends | — | |||||||||||||
Expected life | 7 | |||||||||||||
Risk-free interest rate | 2.11 | % | ||||||||||||
The Company determines the options’ life based upon the use of the simplified method. As a newly public company, sufficient history to estimate the volatility and dividend yield of our common stock is not available. The Company uses a pool of comparable companies as a basis for the expected volatility assumption and dividend yield. The Company intends to continue to consistently apply this process using the comparable companies until sufficient amount of historical information becomes available. The risk free interest rate is based upon the yield of an applicable Treasury instrument. | ||||||||||||||
The Company recognized non-cash share-based compensation expense in its research and development and general and administrative expenses as follows: | ||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||
June 30, | June 30, | |||||||||||||
(in thousands) | 2014 | 2013 | 2014 | 2013 | ||||||||||
Research and development | $ | 20 | $ | 6 | $ | 37 | $ | 30 | ||||||
General and administrative | 420 | 18 | 503 | 18 | ||||||||||
Total | $ | 440 | $ | 24 | $ | 540 | $ | 48 | ||||||
Commitments
Commitments | 6 Months Ended |
Jun. 30, 2014 | |
Commitments and Contingencies Disclosure [Abstract] | ' |
Commitments | ' |
Commitments | |
Lease | |
The Company’s office lease agreement in Research Triangle Park, North Carolina expired in December 2013, and the Company is currently leasing the space on a month-to-month basis. Rent expense was approximately $13,000 and $26,000 for each of the three and six month periods ended June 30, 2014 and 2013, respectively. |
Related_Party_Transactions
Related Party Transactions | 6 Months Ended |
Jun. 30, 2014 | |
Related Party Transactions [Abstract] | ' |
Related Party Transactions | ' |
Related Party Transactions | |
From time to time, the Company reimbursed Care Capital, LLC (“Care”), an affiliate of the majority shareholder of the Company, for services of a Care employee and reimburses Care for such personnel services incurred by Care on behalf of the Company. Total expense recognized in operating results for the three and six month periods ended June 30, 2014 and the three and six month periods ended June 30, 2013 in connection with services provided by Care was $21,000, $70,000, $24,000 and $48,000, respectively. |
Significant_Accounting_Policie1
Significant Accounting Policies (Policies) | 6 Months Ended | |
Jun. 30, 2014 | ||
Accounting Policies [Abstract] | ' | |
Basis of Presentation | ' | |
Basis of Presentation | ||
The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). | ||
Unaudited Interim Financial Information | ' | |
Unaudited Interim Financial Information | ||
The accompanying interim financial statements and related disclosures are unaudited, have been prepared on the same basis as the annual financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary for a fair statement of the results of operations for the periods presented. The year-end balance sheet was derived from audited financial statements, but does not include all disclosures required by U.S. GAAP. The results of operations for any interim period are not necessarily indicative of the results to be expected for the full year or for any other future year or interim period. | ||
Use of Estimates | ' | |
Use of Estimates | ||
The preparation of financial statements in conformity with U.S. 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. Actual results could differ from those estimates. | ||
Warranty Liability | ' | |
Warrant Liability | ||
Certain warrants to purchase the Company’s capital stock had historically been classified as liabilities and were recorded at estimated fair value. At each reporting period, any change in fair value of the freestanding warrants was recorded as other (expense) income. The preferred stock warrant liability was settled upon the closing of the IPO. | ||
Cash and Cash Equivalents | ' | |
Cash and Cash Equivalents | ||
The Company considers all highly liquid investments with original maturities of three months or less to be cash equivalents. | ||
Investments | ' | |
Investments | ||
The Company invests in money market funds and certificates of deposits and considers all investments purchased with a maturity date greater than three months and less than one year to be short-term investments. Those investments with a maturity date greater than one year at each balance sheet date are considered to be long-term investments. As of June 30, 2014, all investments were classified as available-for-sale. These investments are carried at estimated fair value with unrealized gains and losses included in stockholders' equity (deficit). The amortized cost of debt securities is adjusted for amortization of premiums and accretion of discounts to maturity, which is included in interest income. | ||
Concentration of Credit Risk | ' | |
Concentration of Credit Risk | ||
The Company invests its available cash balances in bank deposits, money market funds and certificates of deposit. The Company maintains deposits in federally insured financial institutions in excess of federally insured limits. Management believes that the Company is not exposed to significant credit risk due to the financial position of the depository institutions in which those deposits are held. Additionally, the Company has established guidelines regarding approved investments and maturities of investments, which are designed to maintain safety and liquidity. | ||
Property and Equipment | ' | |
Property and Equipment | ||
Property and equipment consists of furniture, fixtures and computers. Property and equipment are carried at cost less accumulated depreciation. Depreciation is calculated using the straight-line method over the respective asset’s useful life. Maintenance and repairs that do not improve or extend the life of assets are expensed as incurred. When an asset is retired or disposed of, the cost and related accumulated depreciation are removed from the accounts and any resulting gains or losses are reflected within the statement of operations. | ||
Fair value of Financial Instruments | ' | |
Fair Value of Financial Instruments | ||
As of June 30, 2014, financial instruments consist of cash and cash equivalents, short-term investments, accounts receivable and accounts payable. | ||
The Company defines fair value (“FV”) as the price that would be received to sell an asset or paid to transfer a liability ("the exit price") in an orderly transaction between market participants at the measurement date. The FV hierarchy for inputs maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. The Company uses the following hierarchy of inputs to measure FV: | ||
•Level 1: Quoted prices in active markets for identical assets or liabilities; | ||
• | Level 2: Inputs, other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and | |
• | Level 3: Unobservable inputs that are supported by little or no market activity, which require the reporting entity to develop its own assumptions. | |
The Company values investments using the most observable inputs available that are current as of the measurement date and classifies them according to the lowest level of inputs used. Observable inputs are inputs that market participants would use in pricing the asset or liability developed from market data obtained from independent sources. Unobservable inputs are inputs that reflect the Company’s judgment concerning the assumptions that market participants would use in pricing the asset or liability developed from the best information available under the circumstances. | ||
The Company targets investment principally in Level 1 and Level 2 cash equivalents and financial instruments and records them at FV. The Company did not rely on Level 3 inputs for the valuation of any investments at June 30, 2014. The Company expects that the carrying values of cash equivalents will approximate FV because of their short maturities. | ||
The Company classifies as Level 2 investments in certificates of deposits and values them using the market approach based on significant other observable inputs including quoted prices in active markets for instruments that are similar or quoted prices in markets that are not traded on a daily basis for identical or similar instruments. | ||
Research and Development Costs | ' | |
Research and Development Costs | ||
Research and development costs are expensed as incurred. Research and development expenses include personnel costs associated with research and development activities including non-cash share-based compensation, costs for third-party contractors to perform research, conduct clinical trials and manufacture drug supplies and materials. The Company accrues for costs incurred by external service providers, including contract research organizations and clinical investigators, based on its estimates of service performed and costs incurred. These estimates include the level of services performed by the third parties, patient enrollment in clinical trials, administrative costs incurred by the third parties, and other indicators of the services completed. Based on the timing of amounts invoiced by service providers, the Company may also record payments made to those providers as prepaid expenses that will be recognized as expense in future periods as the related services are rendered. | ||
Stock-Based Compensation | ' | |
Stock-Based Compensation | ||
The Company estimates the FV of stock options and stock purchase rights using a Black-Scholes option valuation model which require the input of highly subjective assumptions, including the option’s expected life and the price volatility of the underlying stock. The Company uses the simplified method for estimating the expected term as provided by the Securities and Exchange Commission. The simplified method calculates the expected term as the average time-to-vesting and the contractual life of the options. The expected stock price volatility assumption was determined by examining the historical volatilities of a group of industry peers. The FV of each option grant is estimated on the date of grant using the Black-Scholes option valuation model, and the resulting FV is expensed using the straight-line attribution method over the vesting period, which is the same as the requisite service period. Restricted stock units are measured at the FV of the Company's common stock on the date of grant and expensed over the period of vesting, which is the same as the requisite service period using the straight-line attribution method. | ||
Recent Accounting Pronouncements | ' | |
Recent Accounting Pronouncements | ||
Occasionally, new accounting standards are issued or proposed by the Financial Accounting Standards Board (the “FASB”), or other standards-setting bodies that the Company adopts by the effective date specified within the standard. Unless otherwise discussed, standards that do not require adoption until a future date are not expected to have a material impact on the Company’s financial statements upon adoption. | ||
In February 2013, the FASB issued a final rule related to the reporting of amounts reclassified out of accumulated other comprehensive income that requires entities to report, either on their income statement or in a footnote to their financial statements, the effects on earnings from items that are reclassified out of other comprehensive income. The new accounting rule was effective for the Company in the first quarter of 2013. The adoption of the new accounting rule did not have a material effect on the Company’s financial condition, results of operations or cash flows. The Company chose to present the total of comprehensive income, the components of net income, and the components of other comprehensive income in a single continuous statement of operations and comprehensive income. | ||
In July 2013, the FASB issued Accounting Standards Update, or ASU, No. 2013-11, Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists. ASU 2013-11 provides explicit guidance on the financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. The guidance is effective prospectively for fiscal years, and interim periods within those years, beginning after December 15, 2013, with an option for early adoption. The Company adopted this guidance on January 1, 2014. The adoption did not impact the Company’s financial position or results of operations. | ||
In July 2014, the FASB issued ASU No. 2014-10, Development Stage Entities (Topic 915): Elimination of Certain Financial Reporting Requirements, Including an Amendment to Variable Interest Entities Guidance in Topic 810, Consolidation. The amendments in this ASU remove all incremental financial reporting requirements from U.S. GAAP for development stage entities, including the removal of Topic 915, Development Stage Entities, from the FASB Accounting Standards Codification™. A development stage entity is one that devotes substantially all of its efforts to establishing a new business and for which: (a) planned principal operations have not commenced; or (b) planned principal operations have commenced, but have produced no significant revenue. Current U.S. GAAP requires a development stage entity to present the same basic financial statements and apply the same recognition and measurement rules as established companies. In addition, U.S. GAAP requires a development stage entity to present inception-to-date information about income statement line items, cash flows, and equity transactions. For public business entities, the presentation and disclosure requirements in Topic 915 will no longer be required for the first annual period beginning after December 15, 2014. The revised consolidation standards are effective one year later, in annual periods beginning after December 15, 2015. Early adoption is permitted. The Company adopted the guidance for the quarterly periods ended June 30, 2014. The adoption did not impact the Company’s financial position or results of operations. |
Significant_Accounting_Policie2
Significant Accounting Policies (Tables) | 6 Months Ended | ||||||||||||
Jun. 30, 2014 | |||||||||||||
Accounting Policies [Abstract] | ' | ||||||||||||
Fair Value, Assets Measured on Recurring Basis | ' | ||||||||||||
The following table sets forth our financial instruments carried at FV within the ASC 820 hierarchy and using the lowest level of input as of June 30, 2014: | |||||||||||||
Quoted Prices | |||||||||||||
in Active | Significant | ||||||||||||
(in thousands) | Markets | Other | Significant | ||||||||||
Balance | For Identical Assets | Observable Inputs | Unobservable Inputs | ||||||||||
Assets: | 30-Jun-14 | Level 1 | Level 2 | Level 3 | |||||||||
Money Market Funds | $ | 10,812 | $ | 10,812 | $ | — | $ | — | |||||
Certificates of Deposit | 19,047 | — | 19,047 | — | |||||||||
$ | 29,859 | $ | 10,812 | $ | 19,047 | $ | — | ||||||
Earnings_Per_Share_Tables
Earnings Per Share (Tables) | 6 Months Ended | |||||||||||||
Jun. 30, 2014 | ||||||||||||||
Earnings Per Share [Abstract] | ' | |||||||||||||
Schedule of Earnings Per Share, Basic and Diluted | ' | |||||||||||||
The following table sets forth the computation of basic and diluted net loss per share in thousands, except share and per share data: | ||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||
June 30, | June 30, | |||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||
Historical | ||||||||||||||
Numerator: | ||||||||||||||
Net loss | $ | (5,423 | ) | $ | (803 | ) | $ | (7,123 | ) | $ | (1,276 | ) | ||
Denominator: | ||||||||||||||
Weighted average common shares outstanding | 8,855,114 | 319,882 | 6,733,095 | 319,882 | ||||||||||
Net loss per share-basic and diluted | $ | (0.61 | ) | $ | (2.51 | ) | $ | (1.06 | ) | $ | (3.99 | ) | ||
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | ' | |||||||||||||
Potentially dilutive securities not included in the calculation of diluted net loss per common share because to do so would be anti-dilutive are as follows (in common equivalent shares on a weighted-average basis): | ||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||
June 30, | June 30, | |||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||
Common stock options | 816,695 | 563,461 | 749,225 | 501,946 | ||||||||||
Restricted stock units | 24,000 | — | 24,000 | — | ||||||||||
Common stock warrants | 62,000 | — | 46,586 | — | ||||||||||
Balance_Sheet_Items_Tables
Balance Sheet Items (Tables) | 6 Months Ended | |||||||||||||
Jun. 30, 2014 | ||||||||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' | |||||||||||||
Available-for-sale Securities | ' | |||||||||||||
The following table summarizes the Company's available for sale investments as of June 30, 2014 (in thousands); | ||||||||||||||
Maturity | Amortized | Unrealized | Unrealized | Estimated | ||||||||||
Short-term Investments | (in years) | Cost | Gains | Loss | Fair Value | |||||||||
Money Market | 1 or less | $ | — | $ | — | $ | — | $ | — | |||||
Certificates of Deposit | 1 or less | 18,304 | — | (37 | ) | 18,267 | ||||||||
Total Investments | $ | 18,304 | $ | — | $ | (37 | ) | $ | 18,267 | |||||
Schedule of Accrued Liabilities | ' | |||||||||||||
Accrued liabilities were as follows (in thousands): | ||||||||||||||
June 30, | December 31, | |||||||||||||
2014 | 2013 | |||||||||||||
Accrued clinical trial expenses | $ | 567 | $ | 209 | ||||||||||
Accrued compensation | 496 | 365 | ||||||||||||
Interest | — | 650 | ||||||||||||
Other accruals | 128 | 634 | ||||||||||||
Total | $ | 1,191 | $ | 1,858 | ||||||||||
Stockholders_equity_deficit_Ta
Stockholders' equity (deficit) (Tables) | 6 Months Ended | |||||||||||||
Jun. 30, 2014 | ||||||||||||||
Equity [Abstract] | ' | |||||||||||||
Schedule of reserved shares for future issuance | ' | |||||||||||||
The Company has reserved shares of its common stock for future issuance as of June 30, 2014 as follows: | ||||||||||||||
30-Jun-14 | ||||||||||||||
Stock options outstanding | 822,401 | |||||||||||||
Shares available for grant under stock option plans | 450,349 | |||||||||||||
Restricted stock units | 24,000 | |||||||||||||
Common stock warrants | 62,000 | |||||||||||||
Total shares reserved for future issuance | 1,358,750 | |||||||||||||
Schedule of stock option valuation assumptions | ' | |||||||||||||
The weighted-average assumptions used in the Black-Scholes valuation model for equity awards granted during the six month period ended June 30, 2014 are shown in the table below. No options were issued during the six month period ended June 30, 2013. | ||||||||||||||
Six Months Ended | ||||||||||||||
30-Jun-14 | ||||||||||||||
Expected volatility | 80 | % | ||||||||||||
Expected dividends | — | |||||||||||||
Expected life | 7 | |||||||||||||
Risk-free interest rate | 2.11 | % | ||||||||||||
Schedule of stock option activity | ' | |||||||||||||
The table below summarizes stock option activity for the six months ended June 30, 2014. | ||||||||||||||
Number | Weighted | |||||||||||||
of Shares | Average | |||||||||||||
Exercise | ||||||||||||||
Price | ||||||||||||||
Outstanding as of December 31, 2013 | 563,453 | $ | 1.17 | |||||||||||
Granted | 258,948 | 10.06 | ||||||||||||
Exercised | — | — | ||||||||||||
Canceled | — | — | ||||||||||||
Outstanding as of June 30, 2014 | 822,401 | $ | 3.98 | |||||||||||
Exercisable as of June 30, 2014 | 530,151 | $ | 1.7 | |||||||||||
Schedule of share-based compensation | ' | |||||||||||||
The Company recognized non-cash share-based compensation expense in its research and development and general and administrative expenses as follows: | ||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||
June 30, | June 30, | |||||||||||||
(in thousands) | 2014 | 2013 | 2014 | 2013 | ||||||||||
Research and development | $ | 20 | $ | 6 | $ | 37 | $ | 30 | ||||||
General and administrative | 420 | 18 | 503 | 18 | ||||||||||
Total | $ | 440 | $ | 24 | $ | 540 | $ | 48 | ||||||
The_Company_Details
The Company (Details) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' | ' |
Accumulated deficit | ($48,122) | ($40,999) |
Significant_Accounting_Policie3
Significant Accounting Policies (Details) (USD $) | 0 Months Ended | 6 Months Ended | 0 Months Ended | |||||
In Thousands, except Share data, unless otherwise specified | Feb. 14, 2014 | Jun. 30, 2014 | Jun. 30, 2013 | Feb. 14, 2014 | Feb. 14, 2014 | Feb. 06, 2014 | Feb. 14, 2014 | Feb. 14, 2014 |
Common Stock | Common Stock | Common Stock | Common Stock | |||||
Underwriter | Underwriter | |||||||
Class of Stock [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Stockholders' Equity, Reverse Stock Split | ' | ' | ' | ' | ' | '1-for-6.5 | ' | ' |
Reverse stock split ratio | ' | ' | ' | ' | ' | 0.1538 | ' | ' |
Issuance of common stock at IPO (in shares) | 3,100,000 | ' | ' | ' | ' | ' | ' | ' |
Share price | ' | ' | ' | $12 | ' | ' | ' | ' |
Issuance of common stock at IPO | $33,400 | $33,433 | ' | ' | ' | ' | ' | ' |
Payment of initial public offering costs | $3,800 | $3,737 | $0 | ' | ' | ' | ' | ' |
Issuance of common stock for preferred stock (unaudited) (in shares) | ' | ' | ' | ' | 3,644,354 | ' | ' | ' |
Issuance of common stock for convertible notes and accrued interest (unaudited) (in shares) | ' | ' | ' | ' | 1,197,289 | ' | ' | ' |
Issuance of common stock for preferred stock warrant (unaudited) (in shares) | ' | ' | ' | ' | 593,589 | ' | ' | ' |
Number of shares of stock to be acquired | ' | ' | ' | ' | ' | ' | ' | 62,000 |
Period from effective date of initial public offering until warrants are exercisable | ' | ' | ' | ' | ' | ' | '1 year | ' |
Warrants exercisable price per share (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | $15 |
Significant_Accounting_Policie4
Significant Accounting Policies Assets Fair Value Hierarchy (Details) (USD $) | Jun. 30, 2014 |
In Thousands, unless otherwise specified | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' |
Assets, Fair Value Disclosure | $29,859 |
Money Market | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' |
Assets, Fair Value Disclosure | 10,812 |
Certificates of Deposit | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' |
Assets, Fair Value Disclosure | 19,047 |
Fair Value, Inputs, Level 1 | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' |
Assets, Fair Value Disclosure | 10,812 |
Fair Value, Inputs, Level 1 | Money Market | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' |
Assets, Fair Value Disclosure | 10,812 |
Fair Value, Inputs, Level 1 | Certificates of Deposit | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' |
Assets, Fair Value Disclosure | 0 |
Fair Value, Inputs, Level 2 | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' |
Assets, Fair Value Disclosure | 19,047 |
Fair Value, Inputs, Level 2 | Money Market | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' |
Assets, Fair Value Disclosure | 0 |
Fair Value, Inputs, Level 2 | Certificates of Deposit | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' |
Assets, Fair Value Disclosure | 19,047 |
Fair Value, Inputs, Level 3 | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' |
Assets, Fair Value Disclosure | 0 |
Fair Value, Inputs, Level 3 | Money Market | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' |
Assets, Fair Value Disclosure | 0 |
Fair Value, Inputs, Level 3 | Certificates of Deposit | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' |
Assets, Fair Value Disclosure | $0 |
Earnings_Per_Share_Basic_and_D
Earnings Per Share - Basic and Diluted (Details) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 |
Numerator [Abstract] | ' | ' | ' | ' |
Net loss | ($5,423) | ($803) | ($7,123) | ($1,276) |
Denominator [Abstract] | ' | ' | ' | ' |
Weighted average shares outstanding - basic and diluted (in shares) | 8,855,114 | 319,882 | 6,733,095 | 319,882 |
Net loss per share - basic and diluted (in dollars per share) | ($0.61) | ($2.51) | ($1.06) | ($3.99) |
Earnings_Per_Share_Antidilutiv
Earnings Per Share - Antidilutive Securities (Details) | 0 Months Ended | 3 Months Ended | 6 Months Ended | 3 Months Ended | 6 Months Ended | 3 Months Ended | 6 Months Ended | |||||||
Feb. 14, 2014 | Feb. 14, 2014 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | |
Common Stock | Common stock options | Common stock options | Common stock options | Common stock options | Restricted stock units | Restricted stock units | Restricted stock units | Restricted stock units | Common stock warrants | Common stock warrants | Common stock warrants | Common stock warrants | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Antidilutive securities not included in calculation of diluted net loss per common share | ' | ' | 816,695 | 563,461 | 749,225 | 501,946 | 24,000 | 0 | 24,000 | 0 | 62,000 | 0 | 46,586 | 0 |
Issuance of common stock for preferred stock (unaudited) (in shares) | ' | 3,644,354 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Shares issued for conversion of debt | 1,197,289 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Issuance of common stock for preferred stock warrant (unaudited) (in shares) | ' | 593,589 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Balance_Sheet_Items_Investment
Balance Sheet Items - Investments in Equity Securities (Details) (USD $) | Jun. 30, 2014 | Dec. 31, 2013 |
Available-for-sale Securities [Abstract] | ' | ' |
Amortized Cost | $18,304,000 | ' |
Unrealized Gains | 0 | ' |
Unrealized Loss | -37,000 | ' |
Short-term investments | 18,267,000 | 0 |
Money Market | ' | ' |
Available-for-sale Securities [Abstract] | ' | ' |
Amortized Cost | 0 | ' |
Unrealized Gains | 0 | ' |
Unrealized Loss | 0 | ' |
Short-term investments | 0 | ' |
Certificates of Deposit | ' | ' |
Available-for-sale Securities [Abstract] | ' | ' |
Amortized Cost | 18,304,000 | ' |
Unrealized Gains | 0 | ' |
Unrealized Loss | -37,000 | ' |
Short-term investments | $18,267,000 | ' |
Balance_Sheet_Items_Accrued_Li
Balance Sheet Items - Accrued Liabilities (Details) (USD $) | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | |||
Accrued Liabilities [Abstract] | ' | ' | ' |
Accrued clinical trial expenses | $567 | ' | $209 |
Accrued compensation | 496 | ' | 365 |
Interest | 0 | 0 | 650 |
Other accruals | 128 | ' | 634 |
Total | $1,191 | ' | $1,858 |
License_Agreements_Details
License Agreements (Details) (USD $) | 3 Months Ended | 6 Months Ended | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2014 | Dec. 31, 2007 | |
USCRF | USCRF | USCRF | |||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Annual licensing fee through 2008 | ' | ' | ' | ' | ' | ' | $30,000 |
Annual licensing fee from 2009 through 2010 | ' | ' | ' | ' | ' | ' | 60,000 |
Annual licensing fee from 2011 through 2012 | ' | ' | ' | ' | ' | ' | 62,000 |
Annual licensing fee in 2013 | ' | ' | ' | ' | ' | ' | 122,000 |
Annual licensing fee thereafter | ' | ' | ' | ' | ' | ' | 120,000 |
Potential milestone payments | ' | ' | ' | ' | 6,100,000 | 6,100,000 | ' |
Percentage of non-royalty based on sub-licensee payments received | ' | ' | ' | ' | ' | 25.00% | ' |
Payments upon execution of a sub license | ' | ' | ' | ' | ' | 35,000 | ' |
License Costs | $3,875,000 | $221,000 | $4,332,000 | $485,000 | $30,000 | $60,000 | ' |
Convertible_Notes_Payable_Deta
Convertible Notes Payable (Details) (USD $) | 0 Months Ended | 3 Months Ended | 6 Months Ended | ||||
Feb. 14, 2014 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | |
Debt Disclosure [Abstract] | ' | ' | ' | ' | ' | ' | ' |
Convertible promissory notes converted | $7,900,000 | ' | ' | ' | ' | ' | ' |
Shares issued for conversion of debt | 1,197,289 | ' | ' | ' | ' | ' | ' |
Interest | ' | 0 | ' | 0 | ' | 0 | 650,000 |
Interest expenses | ' | $0 | $87,000 | $78,000 | $158,000 | ' | ' |
Stockholders_equity_deficit_Se
Stockholders' equity (deficit) - Series A Preferred Stock, Warrants, Common Stock (Details) (USD $) | Jun. 30, 2014 | Feb. 14, 2014 | Dec. 31, 2013 | Feb. 14, 2014 | Feb. 14, 2014 | Feb. 14, 2014 |
Common Stock | Underwriter | Underwriter | ||||
Common Stock | Common Stock | |||||
Class of Stock [Line Items] | ' | ' | ' | ' | ' | ' |
Issuance of common stock for preferred stock (unaudited) (in shares) | ' | ' | ' | 3,644,354 | ' | ' |
Issuance of common stock for preferred stock warrant (unaudited) (in shares) | ' | ' | ' | 593,589 | ' | ' |
Number of shares of stock to be acquired | ' | ' | ' | ' | ' | 62,000 |
Period from effective date of initial public offering until warrants are exercisable | ' | ' | ' | ' | '1 year | ' |
Warrants exercisable price per share (in dollars per share) | ' | ' | ' | ' | ' | $15 |
Common stock, shares authorized | 100,000,000 | 100,000,000 | 100,000,000 | ' | ' | ' |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 | ' | ' | ' | ' |
Shares reserved for future issuance | ' | ' | ' | ' | ' | ' |
Stock options outstanding | 822,401 | ' | 563,453 | ' | ' | ' |
Shares available for grant under stock option plans | 450,349 | ' | ' | ' | ' | ' |
Restricted stock units | 24,000 | ' | ' | ' | ' | ' |
Common stock warrants | 62,000 | ' | ' | ' | ' | ' |
Total shares reserved for future issuance | 1,358,750 | ' | ' | ' | ' | ' |
Stockholders_equity_deficit_St
Stockholders' equity (deficit) - Stock Option Plan (Details) (USD $) | 3 Months Ended | 6 Months Ended | 3 Months Ended | 6 Months Ended | 3 Months Ended | 6 Months Ended | 1 Months Ended | 0 Months Ended | ||||||||||
In Thousands, except Share data, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 | Nov. 30, 2013 | Nov. 30, 2013 | Nov. 30, 2013 | 15-May-14 | Jun. 30, 2014 | 15-May-14 |
Research and development | Research and development | Research and development | Research and development | General and administrative | General and administrative | General and administrative | General and administrative | Restricted stock units | Restricted stock units | Restricted stock units | 2007 Equity Incentive Plan | 2007 Equity Incentive Plan | 2007 Equity Incentive Plan | |||||
CEO | Vesting on October 21, 2014 | Vesting Equal Monthly Installments after Nov 1, 2014 | ||||||||||||||||
CEO | CEO | |||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Increase in number of shares authorized under the plan | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 673,923 | ' | ' |
Number of shares authorized under the plan | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,283,226 |
Shares available for grant under stock option plans | 450,349 | ' | 450,349 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 450,349 | ' |
Number of Shares: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Outstanding at the beginning of the period (in shares) | ' | ' | 563,453 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Granted (in shares) | ' | ' | 258,948 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Exercised (in shares) | ' | ' | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cancelled (in shares) | ' | ' | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Outstanding at the end of the period (in shares) | 822,401 | ' | 822,401 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Weighted Average Exercise Price | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Outstanding at the beginning of the period (in dollars per share) | ' | ' | $1.17 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Granted (in dollars per share) | ' | ' | $10.06 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Exercised (in dollars per share) | ' | ' | $0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cancelled (in dollars per share) | ' | ' | $0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Outstanding at the end of the period (in dollars per share) | $3.98 | ' | $3.98 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Options, weighted average grant date fair value (in dollars per share) | ' | ' | $8.66 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Exercisable | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Exercisable at the end of the period (in shares) | 530,151 | ' | 530,151 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Weighted average exercise price for exercisable options (in dollars per share) | $1.70 | ' | $1.70 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Restricted stock units | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of award issued (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 24,000 | ' | ' | ' | ' | ' |
Awards issued, weighted average exercise price (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $4.55 | ' | ' | ' | ' | ' |
Award vesting rights percentage | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 25.00% | 75.00% | ' | ' | ' |
Assumptions used to determine the fair value of the stock options | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Volatility (as a percent) | ' | ' | 80.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Dividend yield | ' | ' | 0.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Expected term | ' | ' | '7 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Risk free interest rate (as a percent) | ' | ' | 2.11% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stock based compensation expense | $440 | $24 | $540 | $48 | $20 | $6 | $37 | $30 | $420 | $18 | $503 | $18 | ' | ' | ' | ' | ' | ' |
Commitments_Details
Commitments (Details) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 |
Lease | ' | ' | ' | ' |
Rent expense | $13 | $13 | $26 | $26 |
Related_Party_Transactions_Det
Related Party Transactions (Details) (Care Capital, LLC, USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2013 |
Care Capital, LLC | ' | ' | ' | ' |
Related Party Transactions [Line Items] | ' | ' | ' | ' |
Expense for services provided | $21 | $24 | $70 | $48 |