Document And Entity Information
Document And Entity Information - shares | 3 Months Ended | |
Mar. 31, 2018 | May 03, 2018 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q1 | |
Entity Registrant Name | 22nd Century Group, Inc. | |
Entity Central Index Key | 1,347,858 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Trading Symbol | XXII | |
Entity Common Stock, Shares Outstanding | 124,311,087 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Mar. 31, 2018 | Dec. 31, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 5,545,244 | $ 3,659,534 |
Short-term investment securities | 53,864,910 | 58,975,513 |
Accounts receivable | 676,230 | 957,066 |
Inventory, net | 3,162,232 | 3,282,537 |
Prepaid expenses and other assets | 1,053,577 | 746,805 |
Total current assets | 64,302,193 | 67,621,455 |
Machinery and equipment, net | 3,437,462 | 3,316,047 |
Other assets: | ||
Intangible assets, net | 7,476,679 | 7,435,411 |
Investment | 7,513,581 | 1,366,493 |
Total other assets | 14,990,260 | 8,801,904 |
Total assets | 82,729,915 | 79,739,406 |
Current liabilities: | ||
Accounts payable | 3,318,679 | 2,080,691 |
Accrued expenses | 1,649,393 | 1,987,675 |
Deferred income | 0 | 28,350 |
Warrant liability | 167,779 | 216,490 |
Total current liabilities | 5,135,851 | 4,313,206 |
Commitments and contingencies (Note 9) | 0 | 0 |
Shareholders' equity | ||
Common stock value | 1,243 | 1,236 |
Capital in excess of par value | 167,373,905 | 166,592,536 |
Accumulated deficit | (89,781,084) | (91,167,572) |
Total shareholders' equity | 77,594,064 | 75,426,200 |
Total liabilities and shareholders' equity | $ 82,729,915 | $ 79,739,406 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Mar. 31, 2018 | Dec. 31, 2017 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, par value | $ 0.00001 | $ 0.00001 |
Common stock, shares authorized | 300,000,000 | 300,000,000 |
Common stock, par value | $ 0.00001 | $ 0.00001 |
Common stock, shares issued | 124,311,087 | 123,569,367 |
Common stock, shares outstanding | 124,311,087 | 123,569,367 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Revenue: | ||
Sale of products, net | $ 6,116,039 | $ 2,231,517 |
Cost of goods sold (exclusive of depreciation shown separately below): | ||
Products | 6,044,461 | 2,505,414 |
Gross profit (loss) | 71,578 | (273,897) |
Operating expenses: | ||
Research and development (including equity based compensation of $220,413 and $13,950, respectively) | 2,516,769 | 550,851 |
General and administrative (including equity based compensation of $307,488 and $128,449, respectively) | 2,032,392 | 1,620,479 |
Sales and marketing (including equity based compensation of $35,975 and $26,580, respectively) | 199,109 | 295,713 |
Depreciation | 124,528 | 88,121 |
Amortization | 167,552 | 140,888 |
Total operating expenses | 5,040,350 | 2,696,052 |
Operating loss | (4,968,772) | (2,969,949) |
Other income (expense): | ||
Warrant liability gain (loss) - net | 48,711 | (5,344) |
Realized gain on short-term investment securities | 195 | 0 |
Unrealized loss on short-term investment securities | (92,574) | 0 |
Unrealized gain on investment | 6,147,088 | 346,180 |
Interest income, net | 251,840 | 15,755 |
Interest expense | 0 | (7,919) |
Total other income (expense) | 6,355,260 | 348,672 |
Income (loss) before income taxes | 1,386,488 | (2,621,277) |
Income taxes | 0 | 0 |
Net income (loss) | $ 1,386,488 | $ (2,621,277) |
Net income (loss) per common share - basic | $ 0.01 | $ (0.03) |
Net Income (loss) per common share - diluted | $ 0.01 | $ (0.03) |
Common shares used in basic earnings per share calculation | 124,019,946 | 90,699,874 |
Common shares used in diluted earnings per share calculation | 144,164,438 | 90,699,874 |
CONSOLIDATED STATEMENTS OF OPE5
CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) - USD ($) | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Research and Development Expense [Member] | ||
Allocated Share-based Compensation Expense | $ 220,413 | $ 13,950 |
General and Administrative Expense [Member] | ||
Allocated Share-based Compensation Expense | 307,488 | 128,449 |
Sales and Marketing Costs Expense [Member] | ||
Allocated Share-based Compensation Expense | $ 35,975 | $ 26,580 |
CONSOLIDATED STATEMENT OF CHANG
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY - 3 months ended Mar. 31, 2018 - USD ($) | Total | Common Stock [Member] | Capital in Excess of Par Value [Member] | Accumulated Deficit [Member] |
Beginning balance at Dec. 31, 2017 | $ 75,426,200 | $ 1,236 | $ 166,592,536 | $ (91,167,572) |
Beginning balance (in shares) at Dec. 31, 2017 | 123,569,367 | |||
Stock issued in connection with warrant exercises | 0 | $ 4 | (4) | 0 |
Stock issued in connection with warrant exercises (in shares) | 426,180 | |||
Stock issued in connection with option exercises | 217,500 | $ 3 | 217,497 | 0 |
Stock issued in connection with option exercises (in shares) | 315,540 | |||
Equity based compensation | 563,876 | $ 0 | 563,876 | 0 |
Net income | 1,386,488 | 0 | 0 | 1,386,488 |
Ending balance at Mar. 31, 2018 | $ 77,594,064 | $ 1,243 | $ 167,373,905 | $ (89,781,084) |
Ending balance (in shares) at Mar. 31, 2018 | 124,311,087 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Cash flows from operating activities: | ||
Net income (loss) | $ 1,386,488 | $ (2,621,277) |
Adjustments to reconcile net income (loss) to cash used in operating activities: | ||
Amortization and depreciation | 267,575 | 204,503 |
Amortization of license fees | 24,506 | 24,506 |
Unrealized gain on investment | (6,147,088) | (346,180) |
Unrealized loss on short-term investment securities | 92,574 | 0 |
Realized gain on short-term investment securities | (195) | 0 |
Warrant liability (gain) loss | (48,711) | 5,344 |
Accretion of interest on note payable and accrued severance | 0 | 7,919 |
Equity based employee compensation expense | 563,876 | 168,979 |
Decrease in allowance for doubtful accounts | 0 | (10,000) |
(Increase) decrease in assets: | ||
Accounts receivable | 280,836 | 48,858 |
Inventory | 120,305 | 57,713 |
Prepaid expenses and other assets | (306,772) | (238,111) |
Increase (decrease) in liabilities: | ||
Accounts payable | 989,360 | 228,754 |
Accrued expenses | (338,282) | (174,444) |
Accrued severance | 0 | (51,923) |
Deferred income | (28,350) | 0 |
Net cash used in operating activities | (3,143,878) | (2,695,359) |
Cash flows from investing activities: | ||
Acquisition of patents and trademarks | (28,751) | (30,097) |
Acquisition of machinery and equipment | (177,384) | (13,710) |
Sales and maturities of short-term investment securities | 41,937,515 | 0 |
Purchase of short-term investment securities | (36,919,292) | 0 |
Net cash provided by (used in) investing activities | 4,812,088 | (43,807) |
Cash flows from financing activities: | ||
Proceeds from exercise of stock options | 217,500 | 0 |
Net cash provided by financing activities | 217,500 | 0 |
Net increase (decrease) in cash | 1,885,710 | (2,739,166) |
Cash and cash equivalents - beginning of period | 3,659,534 | 13,468,188 |
Cash and cash equivalents - end of period | 5,545,244 | 10,729,022 |
Net cash paid for: | ||
Cash paid during the period for interest | 0 | 1,631 |
Cash paid during the period for income taxes | 0 | 0 |
Non-cash transactions: | ||
Patent and trademark additions included in accounts payable | 180,070 | 159,693 |
Machinery and equipment additions included in accounts payable | $ 68,559 | $ 0 |
NATURE OF BUSINESS AND SUMMARY
NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Mar. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 1. - NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Operating results for the three months ended March 31, 2018 are not necessarily indicative of the results that may be expected for the year ending December 31, 2018. The balance sheet as of December 31, 2017 has been derived from the audited consolidated financial statements at that date, but does not include all the information and footnotes required by GAAP for complete financial statements. These interim consolidated financial statements should be read in conjunction with the December 31, 2017 audited consolidated financial statements and the notes thereto contained in our Annual Report on Form 10-K for the year ended December 31, 2017 filed with the Securities and Exchange Commission on March 7, 2018. - - - Concentration of Credit Risk 0 - March 31, December 31, 2018 2017 Inventory - tobacco leaf $ 1,568,292 $ 1,552,474 Inventory - finished goods Cigarettes and filtered cigars 277,448 289,004 Inventory - raw materials Cigarette and filtered cigar components 1,511,492 1,636,059 3,357,232 3,477,537 Less: inventory reserve 195,000 195,000 $ 3,162,232 $ 3,282,537 - 3 10 March 31, December 31, 2018 2017 Intangible assets, net Patent and trademark costs $ 6,536,288 $ 6,327,467 Less: accumulated amortization 2,660,512 2,517,465 Patent and trademark costs, net 3,875,776 3,810,002 License fees, net (see Note 9) 1,450,000 1,450,000 Less: accumulated amortization 351,097 326,591 License fees, net 1,098,903 1,123,409 MSA signatory costs 2,202,000 2,202,000 License fee for predicate cigarette brand 300,000 300,000 $ 7,476,679 $ 7,435,411 Amortization expense relating to the above intangible assets for the three months ended March 31, 2018 and 2017 amounted to $ 167,552 140,888 The estimated annual average amortization expense for the next five years is approximately $ 344,000 98,000 Considering the Company’s history of cumulative net operating losses and the uncertainty of their future utilization, the Company has established a valuation allowance to fully offset its net deferred tax assets as of March 31, 2018 and December 31, 2017. The Company’s federal and state tax returns for the years ended December 31, 2014 through December 31, 2016 are currently open to audit under the statutes of limitations. There were no pending audits as of March 31, 2018. The Tax Cuts and Jobs Act of 2017 (the “TCJA”) was signed into law on December 22, 2017. The TCJA includes significant changes to the U.S. corporate income tax system, including a Federal corporate rate reduction from 35 21 - Revenue Recognition The Company recognizes revenue when it satisfies a performance obligation by transferring control of the product to a customer. The Company’s customer contracts consist of obligations to manufacture the customer’s branded filtered cigars and cigarettes. For certain contracts, the performance obligation is satisfied over time as the Company determined, due to contract restrictions, it does not have an alternative use of the product, and it has an enforceable right to payment as the product is manufactured. The Company recognizes revenue under those contracts at the unit price stated in the contract based on the units manufactured. The manufacturing process is completed on a daily basis and, therefore, there were no performance obligations partially satisfied at March 31, 2018. For the contract where the performance obligation is satisfied at a point in time, the Company recognizes revenue when the product is transferred to the customer. Revenue from the sale of the Company’s products is recognized net of cash discounts, sales returns and allowances. There was no allowance for discounts or returns and allowances at March 31, 2018 and December 31, 2017. The Company generally requires a down payment from its customers prior to commencement of manufacturing the product. Amounts received in advance of satisfying the performance obligations are recorded as deferred revenue. Customer payment terms vary depending on the terms of each customer contract, but payment is generally due prior to product shipment or within extended credit terms up to twenty-one (21) days after shipment. The Company’s net sales revenue is derived from customers located primarily in the United States of America and is disaggregated by the timing of revenue recognition. For the three months ended March 31, 2018, net sales revenue from products transferred over time amounted to approximately $3,923,000 and net sales revenue from products transferred at a point in time amounted to approximately $2,193,000. erivatives Advertising Income (Loss) Per Common Share - - |
OCTOBER 2017 REGISTERED DIRECT
OCTOBER 2017 REGISTERED DIRECT OFFERING | 3 Months Ended |
Mar. 31, 2018 | |
October 2017 [Member] | |
OCTOBER 2017 REGISTERED DIRECT OFFERING | NOTE 2. OCTOBER 2017 REGISTERED DIRECT OFFERING On October 10, 2017, the Company closed a registered direct offering (the “Offering”) with institutional investors purchasing an aggregate of 20,570,000 2.6250 50,732,200 |
JUNE 2017 WARRANT EXERCISE AGRE
JUNE 2017 WARRANT EXERCISE AGREEMENTS | 3 Months Ended |
Mar. 31, 2018 | |
Equity [Abstract] | |
JUNE 2017 WARRANT EXERCISE AGREEMENTS | NOTE 3. JUNE 2017 WARRANT EXERCISE AGREEMENTS On June 19, 2017, the Company entered into Warrant Exercise Agreements (the “Agreements”) with all of the holders (the “Holders”) of outstanding warrants to purchase up to 7,043,211 1.00 4,250,000 1.45 3,229,711 2,354,948 6,169,212 3,813,500 1.00 1,895,052 1.45 6,167,646 In consideration for the Holders exercising their Warrants for cash, the Company issued to each Holder a new warrant (the “New Warrants”) to purchase shares of common stock of the Company equal to the number of shares of common stock received by each Holder upon the cash exercise of the Holder’s Warrants. The terms of the New Warrants are substantially similar to the terms of the Warrants exercised, except the New Warrants (i) have an exercise price equal to $ 2.15 11,293,211 16,049,031 |
MANUFACTURING FACILITY
MANUFACTURING FACILITY | 3 Months Ended |
Mar. 31, 2018 | |
Other Operating Income And Expense [Line Items] | |
MANUFACTURING FACILITY | NOTE 4. - MANUFACTURING FACILITY The Company’s manufacturing operations at its North Carolina factory began approaching production capacity during the three months ended March 31, 2018. The Company significantly expanded capacity during the second and third quarters of 2017 in order to fulfill anticipated new manufacturing contracts. In mid-May of 2017, the Company began the first phase of a manufacturing contract for an existing brand of filtered cigars under a new contract manufacturing agreement (the “New Agreement”) with a third-party and continued manufacturing a third-party MSA cigarette brand and other filtered cigars on a contract basis. The production volume under the New Agreement continued to increase during the first quarter of 2018, has resulted in an increase in the utilization of production capacity, required the hiring of additional personnel, and investment in additional manufacturing equipment for the factory. Raw material component costs, direct manufacturing costs, and an overhead allocation are included in the Cost of goods sold and Finished goods inventory. General and administrative expenses of the factory amounted to $ 310,928 118,750 |
MACHINERY AND EQUIPMENT
MACHINERY AND EQUIPMENT | 3 Months Ended |
Mar. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
MACHINERY AND EQUIPMENT | NOTE 5. - MACHINERY AND EQUIPMENT Machinery and equipment at March 31, 2018 and December 31, 2017 consisted of the following: Useful Life March 31, December 31, Cigarette manufacturing equipment 3 - 10 years $ 4,427,251 $ 4,302,299 Office furniture, fixtures and equipment 5 years 132,796 110,499 Laboratory equipment 5 years 86,609 32,193 Leasehold improvements 6 years 150,707 106,429 4,797,363 4,551,420 Less: accumulated depreciation 1,359,901 1,235,373 Machinery and equipment, net $ 3,437,462 $ 3,316,047 Depreciation expense was $ 124,528 88,121 |
INVESTMENT
INVESTMENT | 3 Months Ended |
Mar. 31, 2018 | |
Equity Method Investments and Joint Ventures [Abstract] | |
INVESTMENT | NOTE 6. - INVESTMENT The Company (through its wholly-owned subsidiary, Botanical Genetics), holds a 14.8 7,513,581 1,366,493 6,147,088 During the first quarter of 2017, a dilutive event occurred bringing the Company’s investment percentage in Anandia below 20 until it adopted ASU 2016-01, as described above. 346,180 |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 3 Months Ended |
Mar. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | NOTE 7. FAIR VALUE MEASUREMENTS FASB ASC 820 - “Fair Value Measurements and Disclosures” establishes a valuation hierarchy for disclosure of the inputs to valuation used to measure fair value. This hierarchy prioritizes the inputs into three broad levels as follows: ⋅ Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities; ⋅ Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the financial instrument; and ⋅ Level 3 inputs are unobservable inputs based on the Company’s own assumptions used to measure assets and liabilities at fair value. A financial asset’s or a financial liability’s classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement. Asset and Liabilities at Fair Value As of March 31, 2018 Level 1 Level 2 Level 3 Total Assets Cash equivalents: Certificates of deposit $ - $ 4,000,000 $ - $ 4,000,000 Short-term investment securities: Certificate of deposit - 3,000,000 - 3,000,000 Money market funds 2,496,646 - - 2,496,646 Corporate bonds - 30,700,272 - 30,700,272 Commercial paper - 2,930,105 - 2,930,105 U.S. treasury securities 5,982,365 - - 5,982,365 U.S. government agency bonds - 8,755,522 - 8,755,522 Total cash equivalents and short-term investment securities $ 8,479,011 $ 49,385,899 $ - $ 57,864,910 Liabilities Warrant liability $ - $ - $ 167,779 $ 167,779 Asset and Liabilities at Fair Value As of December 31, 2017 Level 1 Level 2 Level 3 Total Assets Cash equivalents: Certificate of deposit $ - $ 3,000,000 $ - $ 3,000,000 Short-term investment securities: Certificates of deposit - 6,000,000 - 6,000,000 Money market funds 41,526,540 - - 41,526,540 Corporate bonds 9,450,933 - 9,450,933 U.S. government agency bonds - 1,998,040 - 1,998,040 Total cash equivalents and short-term investment securities $ 41,526,540 $ 20,448,973 $ - $ 61,975,513 Liabilities Warrant liability $ - $ - $ 216,490 $ 216,490 The warrant liability is measured at fair value using certain estimated factors such as volatility and probability which are classified within Level 3 of the valuation hierarchy. Significant unobservable inputs that are used in the fair value measurement of the Company’s derivative warrant liabilities include volatility. Significant increases (decreases) in the volatility input would result in a significantly higher (lower) fair value measurement. |
WARRANTS FOR COMMON STOCK
WARRANTS FOR COMMON STOCK | 3 Months Ended |
Mar. 31, 2018 | |
Warrants For Common Stock [Abstract] | |
WARRANTS FOR COMMON STOCK | NOTE 8. - WARRANTS FOR COMMON STOCK At March 31, 2018, the Company had outstanding warrants to purchase 11,387,932 94,721 During the three months ended March 31, 2018, warrant holders exercised 700,148 During the year ended December 31, 2017, the Company issued 11,293,211 2.15 During the year ended December 31, 2017, warrant holders exercised 12,763,238 1,286,277 223,814 Warrant Description Number of Exercise Expiration August 2012 convertible NP warrants (1) 94,721 $ 0.9310 August 8, 2018 June 2017 warrants pursuant to warrant exercise agreements 11,293,211 $ 2.1500 December 20, 2022 Total warrants outstanding 11,387,932 (1) Includes anti-dilution features. The Company estimates the value of warrant liability upon issuance of the warrants and at each balance sheet date using the binomial lattice model to allocate total enterprise value to the warrants and other securities in the Company’s capital structure. Volatility was estimated based on historical observed equity volatilities and implied (forward) or expected volatilities for a sample group of guideline companies and consideration of recent market trends. since December 31, 2016 Fair value at December 31, 2016 $ 58,681 Loss as a result of change in fair value 157,809 Fair value at December 31, 2017 216,490 Gain as result of change in fair value (48,711) Fair value at March 31, 2018 $ 167,779 The aggregate net gain (loss) as a result of the Company’s warrant liability for the three months ended March 31, 2018 and 2017, amounted to $ 48,711 Number of Warrants outstanding at December 31, 2016 13,781,921 Warrants exercised during 2017 (1,470,027) Warrants expired during 2017 (223,814) Warrants issued pursuant to June 2017 warrant exercise agreements 11,293,211 Warrants exercised pursuant to June 2017 warrant exercise agreements (11,293,211) Warrants outstanding at December 31, 2017 12,088,080 Warrants exercised in Q1 2018 (700,148) Warrants outstanding at March 31, 2018 11,387,932 Composition of outstanding warrants: Warrants containing anti-dilution feature 94,721 Warrants without anti-dilution feature 11,293,211 11,387,932 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Mar. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 9. - COMMITMENTS AND CONTINGENCIES License Agreements 225,000 150,000 29,262 26,843 On December 8, 2015, the Company entered into an additional license agreement (the “License”) with NCSU. Under the terms of the License, the Company paid NCSU a non-refundable, non-creditable lump sum license fee of $ 150,000 10,000 15,000 25,000 50,000 0 29,667 On February 10, 2014, the Company entered into a sponsored research and development agreement (the “Agreement”) with NCSU. Under the terms of the Agreement, the Company paid NCSU $ 162,408 85,681 88,344 All payments made under the above referenced license agreements and the sponsored research and development agreement are initially recorded as a Prepaid expense on the Company’s Consolidated Balance Sheets and subsequently expensed on a straight-line basis over the applicable period and included in Research and development costs on the Company’s Consolidated Statements of Operations. The amounts expensed during the three months ended March 31, 2018 and 2017 were $ 137,232 63,390 On August 22, 2014, the Company entered into a Commercial License Agreement with Precision PlantSciences, Inc. (the “Precision License”). The Precision License grants the Company a non-exclusive, but fully paid up right and license to use technology and materials owned by Precision PlantSciences for a license fee of $ 1,250,000 On August 27, 2014, the Company entered into an additional exclusive License Agreement (the “License Agreement”) with NCSU. Under the License Agreement, the Company paid NCSU a non-refundable, non-creditable lump sum license fee of $ 125,000 75,000 75,000 15,000 20,000 30,000 50,000 4,470 19,069 On September 15, 2014, the Company entered into a Sublicense Agreement with Anandia Laboratories, Inc. (the “Anandia Sublicense”). Under the terms of the Anandia Sublicense, the Company was granted an exclusive sublicense in the United States and a co-exclusive sublicense in the remainder of the world, excluding Canada, to the licensed intellectual property. The Anandia Sublicense required an up-front fee of $ 75,000 10,000 The Precision License, the License Agreement with NCSU and the Anandia Sublicense are included in Intangible assets, net in the Company’s Consolidated Balance Sheets and the applicable license fees will be amortized over the term of the agreements based on their last-to-expire patent date. Amortization amounted to $ 24,506 24,506 On September 28, 2015, the Company’s wholly-owned subsidiary, Botanical Genetics, entered into a Sponsored Research Agreement (the “Agreement”) with Anandia Laboratories Inc. (“Anandia”). Pursuant to the Agreement, Anandia is conducting research on behalf of the Company relating to the cannabis/hemp plant. The Agreement had an initial term of twelve (12) months from the date of the Agreement and can be extended at the sole option of the Company for two (2) additional periods of twelve (12) months each (of which the option on the first twelve (12) month period has been extended). The Company paid Anandia $ 379,800 785,100 65,425 130,850 65,425 The Company had an R&D agreement with the University of Virginia (“UVA”) relating to nicotine biosynthesis in tobacco plants. The extended term of the R&D agreement with UVA expired on October 31, 2016. In December 2016, the Company entered into a new sponsored research agreement with UVA and an exclusive license agreement with the University of Virginia Patent Foundation d/b/a University of Virginia Licensing & Ventures Group (“UVA LVG”) pursuant to which the Company will invest approximately $ 1,000,000 103,967 40,845 Lease Agreements 42,000 38,000 Year ended December 31, 2018 - $ 127,000 Year ended December 31, 2019 - $ 169,000 Year ended December 31, 2020 - $ 169,000 Year ended December 31, 2021 - $ 141,000 On August 14, 2017, the Company entered into a lease for warehouse space in North Carolina to store and operate tobacco leaf processing equipment, to store the Company’s proprietary tobacco leaf and to store inventory used in the Company’s contract manufacturing business. The lease calls for a monthly payment of $ 4,665 56,000 On October 4, 2017, the Company entered a new lease for office space at a new location located in Williamsville, New York with an initial three-year term and with a monthly lease payment of $ 6,375 57,000 76,000 76,000 On May 1, 2016, the Company entered into a sublease for laboratory space in Buffalo, New York. The sublease calls for a monthly payment of $ 1,471 1,219 2,690 2,770 5,760 52,000 34,000 Modified Risk Tobacco Products Application (“ MRTP Brand A $ 1,296,000 0 8,000,000 next six to twelve months Litigation On April 26, 2016, Crede CG III, LTD. (“Crede”) filed a complaint against the Company in the United States District Court for the Southern District of New York (the “SDNY Court”) entitled Crede CG III, LTD. v. 22nd Century Group, Inc 2,077,555 On May 19, 2016, Crede filed a motion for preliminary injunction, asking the SDNY Court to require the Company to issue 2,077,555 Following such ruling, on July 11, 2016, the Company filed a motion to sever the Crede lawsuit into two separate cases, requesting all claims relating to the Tranche 1A warrant and the securities purchase agreement to stay in the SDNY Court and all claims relating to the China joint venture agreement to be transferred to the United States District Court for the Western District of New York (the “WDNY Court”), where the Company’s headquarters are located. On January 20, 2017, the SDNY Court granted the Company’s motion. On February 14, 2017, Crede voluntarily dismissed its lawsuit against the Company in the WDNY Court. On February 21, 2017, the SDNY Court granted the Company’s request to file a motion for summary judgment for the claims remaining in the SDNY Court, with all discovery in the case being deferred until after the SDNY Court issues its decision on the summary judgment motion of the Company. On March 20, 2017, the Company filed its motion for summary judgment for the claims remaining in the SDNY Court. The response by Crede to the Company’s summary judgment motion was filed by Crede on May 1, 2017. On May 15, 2017, the Company filed its response to Crede’s filing. On December 28, 2017, the SDNY Court issued its decision in response to the Company’s motion for summary judgement, with such decision (i) granting the Company’s motion for summary judgement relating to Count II of the Amended Compliant, which eliminates Crede’s claim to rescind the prior securities purchase agreement, dated September 17, 2014, and denies Crede’s claim for the return of any money from the Company under that securities purchase agreement, and (ii) denying the Company’s motion for summary judgement on the remaining Counts of the Amended Compliant. In this decision, the SDNY Court also found that Crede breached the Activity Restrictions as defined and contained in the Tranche 1A warrant. As a result of this decision by the SDNY Court, the parties will now proceed with discovery in the case in preparation for a trial on the remaining Counts III, IV and V of the Amended Complaint, which relate to Crede’s claim (i) to exchange the Tranche 1A warrant for 2,077,555 18 The SDNY Court has recently ordered that the discovery deadline be extended to July 1, 2018, and for the parties to submit a proposed amended case management schedule addressing other pretrial deadlines by May 9, 2018. The Company believes that the claims are frivolous, meritless and that the Company has substantial legal and factual defenses to the claims. The Company has defended and intends to continue to defend against these claims vigorously. |
EARNINGS PER COMMON SHARE
EARNINGS PER COMMON SHARE | 3 Months Ended |
Mar. 31, 2018 | |
Earnings Per Common Share [Abstract] | |
EARNINGS PER COMMON SHARE | NOTE 10. - EARNINGS PER COMMON SHARE March 31, March 31, Net income (loss) attributed to common shareholders $ 1,386,488 $ (2,621,277) Denominator for basic earnings per share-weighted average shares outstanding 124,019,946 90,699,874 Effect of dilutive securities: Warrants and options outstanding 20,144,492 - Denominator for diluted earnings per common share-weighted average shares adjusted for dilutive securities 144,164,438 90,699,874 Net income (loss) per common share - basic and diluted $ 0.01 $ (0.03) March 31, March 31, Warrants 11,387,932 13,406,691 Options 8,756,560 5,650,679 20,144,492 19,057,370 |
EQUITY BASED COMPENSATION
EQUITY BASED COMPENSATION | 3 Months Ended |
Mar. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
EQUITY BASED COMPENSATION | NOTE 11. EQUITY BASED COMPENSATION On April 12, 2014, the stockholders of the Company approved the 22nd Century Group, Inc. 2014 Omnibus Incentive Plan (the “OIP”) and the authorization of 5,000,000 5,000,000 10,000,000 1,802,115 During the three months ended March 31, 2018, the Company issued stock option awards from the OIP for 1,131,841 For the three months ended March 31, 2018 and 2017, the Company recorded compensation expense related to stock option awards granted under the OIP of $ 563,876 168,979 As of March 31, 2018, unrecognized compensation expense related to non-vested stock options amounted to approximately $ 5,249,000 2,509,000 1,064,000 698,000 98,000 447,000 433,000 never 2018 2017 Risk-free interest rate (weighted average) 2.67 % n/a Expected dividend yield 0 % n/a Expected stock price volatility 90 % n/a Expected life of options (weighted average) 5.45 years n/a The Company estimated the expected volatility based on data used by a peer group of public companies. The expected term was estimated using the contract life of the option. The risk-free interest rate assumption was determined using yield of the equivalent U.S. Treasury bonds over the expected term. The Company has never paid any cash dividends and does not anticipate paying any cash dividends in the foreseeable future. Therefore, the Company assumed an expected dividend yield of zero. Weighted Average Weighted Remaining Aggregate Number of Average Contractual Intrinsic Options Exercise Price Term Value Outstanding at December 31, 2016 5,650,679 $ 1.04 Granted in 2017 2,692,000 $ 1.76 Exercised in 2017 (85,988) $ 0.79 Expired in 2017 (100,000) $ 1.43 Outstanding at December 31, 2017 8,156,691 $ 1.28 Granted in 2018 1,131,841 $ 2.76 Exercised in 2018 (327,781) $ 0.81 Expired in 2018 (204,191) $ 1.11 Outstanding at March 31, 2018 8,756,560 $ 1.49 7.3 years $ 7,847,766 Exercisable at March 31, 2018 3,623,471 $ 1.11 5.8 years $ 4,563,638 There were stock options granted during the three months ended March 31, 2018 to purchase a total of 1,131,841 1.82 235,715 562,715 327,781 315,540 217,500 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Mar. 31, 2018 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 12. - SUBSEQUENT EVENTS The Company’s Senior Vice President of Science and Regulatory Affairs, James E. Swauger, Ph.D., died on April 19, 2018. As a result, stock options to purchase a total of 900,000 of the Company’s common stock with an exercise price of $ 2.12 300,000 2.12 1,227,000 443,000 |
NATURE OF BUSINESS AND SUMMAR20
NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Mar. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation - Operating results for the three months ended March 31, 2018 are not necessarily indicative of the results that may be expected for the year ending December 31, 2018. The balance sheet as of December 31, 2017 has been derived from the audited consolidated financial statements at that date, but does not include all the information and footnotes required by GAAP for complete financial statements. These interim consolidated financial statements should be read in conjunction with the December 31, 2017 audited consolidated financial statements and the notes thereto contained in our Annual Report on Form 10-K for the year ended December 31, 2017 filed with the Securities and Exchange Commission on March 7, 2018. |
Principles of Consolidation | Principles of Consolidation - |
Nature of Business | Nature of Business - |
Reclassifications | Reclassifications |
Preferred stock authorized | Preferred stock authorized - |
Concentration of Credit Risk | Concentration of Credit Risk |
Cash and cash equivalents | Cash and cash equivalents |
Short-term investment securities | Short-term investment securities |
Accounts receivable | Accounts receivable 0 |
Inventory | Inventory - March 31, December 31, 2018 2017 Inventory - tobacco leaf $ 1,568,292 $ 1,552,474 Inventory - finished goods Cigarettes and filtered cigars 277,448 289,004 Inventory - raw materials Cigarette and filtered cigar components 1,511,492 1,636,059 3,357,232 3,477,537 Less: inventory reserve 195,000 195,000 $ 3,162,232 $ 3,282,537 |
Machinery and equipment | Machinery and equipment - 3 10 |
Intangible Assets | Intangible Assets March 31, December 31, 2018 2017 Intangible assets, net Patent and trademark costs $ 6,536,288 $ 6,327,467 Less: accumulated amortization 2,660,512 2,517,465 Patent and trademark costs, net 3,875,776 3,810,002 License fees, net (see Note 9) 1,450,000 1,450,000 Less: accumulated amortization 351,097 326,591 License fees, net 1,098,903 1,123,409 MSA signatory costs 2,202,000 2,202,000 License fee for predicate cigarette brand 300,000 300,000 $ 7,476,679 $ 7,435,411 Amortization expense relating to the above intangible assets for the three months ended March 31, 2018 and 2017 amounted to $ 167,552 140,888 The estimated annual average amortization expense for the next five years is approximately $ 344,000 98,000 |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets |
Income Taxes | Income Taxes Considering the Company’s history of cumulative net operating losses and the uncertainty of their future utilization, the Company has established a valuation allowance to fully offset its net deferred tax assets as of March 31, 2018 and December 31, 2017. The Company’s federal and state tax returns for the years ended December 31, 2014 through December 31, 2016 are currently open to audit under the statutes of limitations. There were no pending audits as of March 31, 2018. The Tax Cuts and Jobs Act of 2017 (the “TCJA”) was signed into law on December 22, 2017. The TCJA includes significant changes to the U.S. corporate income tax system, including a Federal corporate rate reduction from 35 21 |
Stock Based Compensation | Stock Based Compensation - |
Revenue Recognition | Revenue Recognition The Company recognizes revenue when it satisfies a performance obligation by transferring control of the product to a customer. The Company’s customer contracts consist of obligations to manufacture the customer’s branded filtered cigars and cigarettes. For certain contracts, the performance obligation is satisfied over time as the Company determined, due to contract restrictions, it does not have an alternative use of the product, and it has an enforceable right to payment as the product is manufactured. The Company recognizes revenue under those contracts at the unit price stated in the contract based on the units manufactured. The manufacturing process is completed on a daily basis and, therefore, there were no performance obligations partially satisfied at March 31, 2018. For the contract where the performance obligation is satisfied at a point in time, the Company recognizes revenue when the product is transferred to the customer. Revenue from the sale of the Company’s products is recognized net of cash discounts, sales returns and allowances. There was no allowance for discounts or returns and allowances at March 31, 2018 and December 31, 2017. The Company generally requires a down payment from its customers prior to commencement of manufacturing the product. Amounts received in advance of satisfying the performance obligations are recorded as deferred revenue. Customer payment terms vary depending on the terms of each customer contract, but payment is generally due prior to product shipment or within extended credit terms up to twenty-one (21) days after shipment. The Company’s net sales revenue is derived from customers located primarily in the United States of America and is disaggregated by the timing of revenue recognition. For the three months ended March 31, 2018, net sales revenue from products transferred over time amounted to approximately $3,923,000 and net sales revenue from products transferred at a point in time amounted to approximately $2,193,000. |
Derivatives | erivatives |
Research and Development | Research and Development |
Advertising | Advertising |
Income (Loss) Per Common Share | Income (Loss) Per Common Share - |
Commitment and Contingency Accounting | Commitment and Contingency Accounting |
Use of Estimates | Use of Estimates |
Fair value of financial instruments | Fair Value of Financial Instruments - |
Investments | Investments - |
Accounting Pronouncements | Accounting Pronouncements - |
NATURE OF BUSINESS AND SUMMAR21
NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Inventory, Current | Inventories at March 31, 2018 and December 31, 2017 consisted of the following: March 31, December 31, 2018 2017 Inventory - tobacco leaf $ 1,568,292 $ 1,552,474 Inventory - finished goods Cigarettes and filtered cigars 277,448 289,004 Inventory - raw materials Cigarette and filtered cigar components 1,511,492 1,636,059 3,357,232 3,477,537 Less: inventory reserve 195,000 195,000 $ 3,162,232 $ 3,282,537 |
Schedule of Intangible Assets and Goodwill | Total intangible assets at March 31, 2018 and December 31, 2017 consisted of the following: March 31, December 31, 2018 2017 Intangible assets, net Patent and trademark costs $ 6,536,288 $ 6,327,467 Less: accumulated amortization 2,660,512 2,517,465 Patent and trademark costs, net 3,875,776 3,810,002 License fees, net (see Note 9) 1,450,000 1,450,000 Less: accumulated amortization 351,097 326,591 License fees, net 1,098,903 1,123,409 MSA signatory costs 2,202,000 2,202,000 License fee for predicate cigarette brand 300,000 300,000 $ 7,476,679 $ 7,435,411 |
MACHINERY AND EQUIPMENT (Tables
MACHINERY AND EQUIPMENT (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
MACHINERY AND EQUIPMENT | Machinery and equipment at March 31, 2018 and December 31, 2017 consisted of the following: Useful Life March 31, December 31, Cigarette manufacturing equipment 3 - 10 years $ 4,427,251 $ 4,302,299 Office furniture, fixtures and equipment 5 years 132,796 110,499 Laboratory equipment 5 years 86,609 32,193 Leasehold improvements 6 years 150,707 106,429 4,797,363 4,551,420 Less: accumulated depreciation 1,359,901 1,235,373 Machinery and equipment, net $ 3,437,462 $ 3,316,047 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Schedule of Assets and Liabilities Measured at Fair Value | The following table presents information about our assets and liabilities measured at fair value at March 31, 2018 and December 31, 2017, and indicates the fair value hierarchy of the valuation techniques the Company utilized to determine such fair value: Asset and Liabilities at Fair Value As of March 31, 2018 Level 1 Level 2 Level 3 Total Assets Cash equivalents: Certificates of deposit $ - $ 4,000,000 $ - $ 4,000,000 Short-term investment securities: Certificate of deposit - 3,000,000 - 3,000,000 Money market funds 2,496,646 - - 2,496,646 Corporate bonds - 30,700,272 - 30,700,272 Commercial paper - 2,930,105 - 2,930,105 U.S. treasury securities 5,982,365 - - 5,982,365 U.S. government agency bonds - 8,755,522 - 8,755,522 Total cash equivalents and short-term investment securities $ 8,479,011 $ 49,385,899 $ - $ 57,864,910 Liabilities Warrant liability $ - $ - $ 167,779 $ 167,779 Asset and Liabilities at Fair Value As of December 31, 2017 Level 1 Level 2 Level 3 Total Assets Cash equivalents: Certificate of deposit $ - $ 3,000,000 $ - $ 3,000,000 Short-term investment securities: Certificates of deposit - 6,000,000 - 6,000,000 Money market funds 41,526,540 - - 41,526,540 Corporate bonds 9,450,933 - 9,450,933 U.S. government agency bonds - 1,998,040 - 1,998,040 Total cash equivalents and short-term investment securities $ 41,526,540 $ 20,448,973 $ - $ 61,975,513 Liabilities Warrant liability $ - $ - $ 216,490 $ 216,490 |
WARRANTS FOR COMMON STOCK (Tabl
WARRANTS FOR COMMON STOCK (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Warrants For Common Stock [Abstract] | |
Schedule Of Warrants Outstanding | Outstanding warrants at March 31, 2018 consisted of the following: Warrant Description Number of Exercise Expiration August 2012 convertible NP warrants (1) 94,721 $ 0.9310 August 8, 2018 June 2017 warrants pursuant to warrant exercise agreements 11,293,211 $ 2.1500 December 20, 2022 Total warrants outstanding 11,387,932 (1) Includes anti-dilution features. |
Roll-Forward of Warrant Liability from Intitial Valuation | The following table is a roll-forward summary of the warrant liability since December 31, 2016 Fair value at December 31, 2016 $ 58,681 Loss as a result of change in fair value 157,809 Fair value at December 31, 2017 216,490 Gain as result of change in fair value (48,711) Fair value at March 31, 2018 $ 167,779 |
Warrant Activity | The following table summarizes the Company’s warrant activity since December 31, 2016: Number of Warrants outstanding at December 31, 2016 13,781,921 Warrants exercised during 2017 (1,470,027) Warrants expired during 2017 (223,814) Warrants issued pursuant to June 2017 warrant exercise agreements 11,293,211 Warrants exercised pursuant to June 2017 warrant exercise agreements (11,293,211) Warrants outstanding at December 31, 2017 12,088,080 Warrants exercised in Q1 2018 (700,148) Warrants outstanding at March 31, 2018 11,387,932 Composition of outstanding warrants: Warrants containing anti-dilution feature 94,721 Warrants without anti-dilution feature 11,293,211 11,387,932 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Rental Payments for Operating Leases | Year ended December 31, 2018 - $ 127,000 Year ended December 31, 2019 - $ 169,000 Year ended December 31, 2020 - $ 169,000 Year ended December 31, 2021 - $ 141,000 |
EARNINGS PER COMMON SHARE (Tabl
EARNINGS PER COMMON SHARE (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Earnings Per Common Share [Abstract] | |
Computation of Basic and Diluted Earnings Per Common Share | The following table sets forth the computation of basic and diluted earnings per common share for the three-month periods ended March 31, 2018 and 2017: March 31, March 31, Net income (loss) attributed to common shareholders $ 1,386,488 $ (2,621,277) Denominator for basic earnings per share-weighted average shares outstanding 124,019,946 90,699,874 Effect of dilutive securities: Warrants and options outstanding 20,144,492 - Denominator for diluted earnings per common share-weighted average shares adjusted for dilutive securities 144,164,438 90,699,874 Net income (loss) per common share - basic and diluted $ 0.01 $ (0.03) |
Schedule Outstanding Excluded from Computation Because they would have bee Anti-dilutive | Dilutive securities outstanding at March 31, 2018 and 2017 are presented below. March 31, March 31, Warrants 11,387,932 13,406,691 Options 8,756,560 5,650,679 20,144,492 19,057,370 |
EQUITY BASED COMPENSATION (Tabl
EQUITY BASED COMPENSATION (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Fair Value Assumptions | The following assumptions were used for the three months ended March 31, 2018 and 2017: 2018 2017 Risk-free interest rate (weighted average) 2.67 % n/a Expected dividend yield 0 % n/a Expected stock price volatility 90 % n/a Expected life of options (weighted average) 5.45 years n/a |
Summary of All Stock Option Activity | A summary of all stock option activity since December 31, 2016 is as follows: Weighted Average Weighted Remaining Aggregate Number of Average Contractual Intrinsic Options Exercise Price Term Value Outstanding at December 31, 2016 5,650,679 $ 1.04 Granted in 2017 2,692,000 $ 1.76 Exercised in 2017 (85,988) $ 0.79 Expired in 2017 (100,000) $ 1.43 Outstanding at December 31, 2017 8,156,691 $ 1.28 Granted in 2018 1,131,841 $ 2.76 Exercised in 2018 (327,781) $ 0.81 Expired in 2018 (204,191) $ 1.11 Outstanding at March 31, 2018 8,756,560 $ 1.49 7.3 years $ 7,847,766 Exercisable at March 31, 2018 3,623,471 $ 1.11 5.8 years $ 4,563,638 |
NATURE OF BUSINESS AND SUMMAR28
NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Narrative) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | |
Condensed Financial Statements, Captions [Line Items] | ||||
Amortization of Intangible Assets | $ 167,552 | $ 140,888 | ||
Allowance for Doubtful Accounts Receivable | 0 | $ 0 | ||
Advertising Expense | 12,000 | $ 31,000 | ||
Transferred at Point in Time [Member] | ||||
Condensed Financial Statements, Captions [Line Items] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | 2,193,000 | |||
Transferred over Time [Member] | ||||
Condensed Financial Statements, Captions [Line Items] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | 3,923,000 | |||
Scenario, Plan [Member] | ||||
Condensed Financial Statements, Captions [Line Items] | ||||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 21.00% | |||
Patent and Trademarks [Member] | ||||
Condensed Financial Statements, Captions [Line Items] | ||||
Finite-Lived Intangible Assets, Amortization Expense, after Year Five | 344,000 | |||
Licensing Agreements [Member] | ||||
Condensed Financial Statements, Captions [Line Items] | ||||
Finite-Lived Intangible Assets, Amortization Expense, after Year Five | $ 98,000 | |||
Maximum [Member] | ||||
Condensed Financial Statements, Captions [Line Items] | ||||
Property, Plant and Equipment, Estimated Useful Lives | 10 | |||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 35.00% | |||
Minimum [Member] | ||||
Condensed Financial Statements, Captions [Line Items] | ||||
Property, Plant and Equipment, Estimated Useful Lives | 3 |
NATURE OF BUSINESS AND SUMMAR29
NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) | Mar. 31, 2018 | Dec. 31, 2017 |
Inventory [Line Items] | ||
Inventory - tobacco leaf | $ 1,568,292 | $ 1,552,474 |
Inventory - finished goods | ||
Cigarettes and filtered cigars | 277,448 | 289,004 |
Inventory - raw materials | ||
Cigarette and filtered cigar components | 1,511,492 | 1,636,059 |
Inventory - tobacco leaf, net | 3,357,232 | 3,477,537 |
Less: inventory reserve | 195,000 | 195,000 |
Inventory, Net | $ 3,162,232 | $ 3,282,537 |
NATURE OF BUSINESS AND SUMMAR30
NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 1) - USD ($) | Mar. 31, 2018 | Dec. 31, 2017 |
Intangible assets, net | ||
Intangible assets, net | $ 7,476,679 | $ 7,435,411 |
Patent and Trademark [Member] | ||
Intangible assets, net | ||
Patent and trademark costs | 6,536,288 | 6,327,467 |
Less: accumulated amortization | 2,660,512 | 2,517,465 |
Patent and trademark costs, net | 3,875,776 | 3,810,002 |
Licensing Agreements [Member] | ||
Intangible assets, net | ||
Patent and trademark costs | 1,450,000 | 1,450,000 |
Less: accumulated amortization | 351,097 | 326,591 |
Patent and trademark costs, net | 1,098,903 | 1,123,409 |
MSA Signatory Costs [Member] | ||
Intangible assets, net | ||
License fee for predicate cigarette brand | 2,202,000 | 2,202,000 |
License Fees, Net [Member] | ||
Intangible assets, net | ||
License fee for predicate cigarette brand | $ 300,000 | $ 300,000 |
OCTOBER 2017 REGISTERED DIREC31
OCTOBER 2017 REGISTERED DIRECT OFFERING (Narrative) (Details) - October 2017 [Member] | Oct. 10, 2017USD ($)$ / sharesshares |
Stock Issued During Period, Shares, New Issues | shares | 20,570,000 |
Shares Issued, Price Per Share | $ / shares | $ 2.6250 |
Proceeds from Issuance of Common Stock | $ | $ 50,732,200 |
JUNE 2017 WARRANT EXERCISE AG32
JUNE 2017 WARRANT EXERCISE AGREEMENTS (Narrative) (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||
Aug. 31, 2017 | Jul. 31, 2017 | Jun. 30, 2017 | Jun. 19, 2017 | Mar. 31, 2018 | Dec. 31, 2017 | |
Number Of Warrants Exercised | (1,470,027) | |||||
Proceeds from Warrant Exercises | $ 6,169,212 | |||||
Class of Warrant or Right,Exercise Price One [Member] | ||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 7,043,211 | |||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 1 | $ 1 | $ 1 | |||
Number Of Warrants Exercised | 3,813,500 | 3,229,711 | ||||
Proceeds from Warrant Exercises | $ 6,167,646 | |||||
Class of Warrant or Right,Exercise Price Two [Member] | ||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 4,250,000 | |||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 1.45 | $ 1.45 | $ 1.45 | |||
Number Of Warrants Exercised | 1,895,052 | 2,354,948 | ||||
Proceeds from Warrant Exercises | $ 6,167,646 | |||||
New Warrants [Member] | ||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 2.15 | |||||
Fair Value of Warrants | $ 16,049,031 | |||||
Warrants Expiration Term | are exercisable six months from the date of issuance of the New Warrants for a period of five (5) years. | |||||
Number Of Warrants Issued | 11,293,211 |
MANUFACTURING FACILITY (Narrati
MANUFACTURING FACILITY (Narrative) (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Manufacturing Facility [Line Items] | ||
General and Administrative Expense, Total | $ 2,032,392 | $ 1,620,479 |
North Carolina Manufacturing Facility [Member] | ||
Manufacturing Facility [Line Items] | ||
General and Administrative Expense, Total | $ 310,928 | $ 118,750 |
MACHINERY AND EQUIPMENT (Narrat
MACHINERY AND EQUIPMENT (Narrative) (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Property, Plant and Equipment [Line Items] | ||
Depreciation, Total | $ 124,528 | $ 88,121 |
MACHINERY AND EQUIPMENT (Detail
MACHINERY AND EQUIPMENT (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2018 | Dec. 31, 2017 | |
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 4,797,363 | $ 4,551,420 |
Less: accumulated depreciation | 1,359,901 | 1,235,373 |
Machinery and equipment, net | 3,437,462 | 3,316,047 |
Cigarette manufacturing equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 4,427,251 | 4,302,299 |
Cigarette manufacturing equipment [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 10 years | |
Cigarette manufacturing equipment [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 3 years | |
Office furniture, fixtures and equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 132,796 | 110,499 |
Property, Plant and Equipment, Useful Life | 5 years | |
Laboratory equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 86,609 | 32,193 |
Property, Plant and Equipment, Useful Life | 5 years | |
Leasehold improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 150,707 | $ 106,429 |
Property, Plant and Equipment, Useful Life | 6 years |
INVESTMENT (Narrative) (Details
INVESTMENT (Narrative) (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | |
Schedule of Equity Method Investments [Line Items] | |||
Unrealized Gain (Loss) on Investments | $ 6,147,088 | $ 346,180 | |
Anandia [Member] | |||
Schedule of Equity Method Investments [Line Items] | |||
Unrealized Gain (Loss) on Investments | $ 6,147,088 | $ 346,180 | |
Noncontrolling Interest, Ownership Percentage by Parent | 20.00% | ||
Anandia Laboratories, Inc [Member] | |||
Schedule of Equity Method Investments [Line Items] | |||
Noncontrolling Interest, Ownership Percentage by Parent | 14.80% | ||
Anandia Laboratories, Inc [Member] | Other Assets [Member] | |||
Schedule of Equity Method Investments [Line Items] | |||
Equity Method Investments | $ 7,513,581 | $ 1,366,493 |
FAIR VALUE MEASUREMENTS (Detail
FAIR VALUE MEASUREMENTS (Details) - USD ($) | Mar. 31, 2018 | Dec. 31, 2017 |
U.S. government agency bonds [Member] | ||
Assets | ||
Total cash equivalents and short-term investment securities | $ 8,755,522 | $ 1,998,040 |
US Treasury Securities [Member] | ||
Assets | ||
Total cash equivalents and short-term investment securities | 5,982,365 | |
Warrant Liability [Member] | ||
Liabilities | ||
Warrant liability | 167,779 | 216,490 |
Short-term investment securities [Member] | ||
Assets | ||
Total cash equivalents and short-term investment securities | 3,000,000 | 6,000,000 |
Corporate Bonds [Member] | ||
Assets | ||
Total cash equivalents and short-term investment securities | 30,700,272 | 9,450,933 |
Cash Equivalents and Short-term Investment Securities [Member] | ||
Assets | ||
Total cash equivalents and short-term investment securities | 57,864,910 | 61,975,513 |
Certificates of Deposit [Member] | ||
Assets | ||
Total cash equivalents and short-term investment securities | 4,000,000 | 3,000,000 |
Money Market Funds [Member] | ||
Assets | ||
Total cash equivalents and short-term investment securities | 2,496,646 | 41,526,540 |
Commercial Paper [Member] | ||
Assets | ||
Total cash equivalents and short-term investment securities | 2,930,105 | |
Fair Value, Inputs, Level 1 [Member] | U.S. government agency bonds [Member] | ||
Assets | ||
Total cash equivalents and short-term investment securities | 0 | 0 |
Fair Value, Inputs, Level 1 [Member] | US Treasury Securities [Member] | ||
Assets | ||
Total cash equivalents and short-term investment securities | 5,982,365 | |
Fair Value, Inputs, Level 1 [Member] | Warrant Liability [Member] | ||
Liabilities | ||
Warrant liability | 0 | 0 |
Fair Value, Inputs, Level 1 [Member] | Short-term investment securities [Member] | ||
Assets | ||
Total cash equivalents and short-term investment securities | 0 | 0 |
Fair Value, Inputs, Level 1 [Member] | Corporate Bonds [Member] | ||
Assets | ||
Total cash equivalents and short-term investment securities | 0 | 0 |
Fair Value, Inputs, Level 1 [Member] | Cash Equivalents and Short-term Investment Securities [Member] | ||
Assets | ||
Total cash equivalents and short-term investment securities | 8,479,011 | 41,526,540 |
Fair Value, Inputs, Level 1 [Member] | Certificates of Deposit [Member] | ||
Assets | ||
Total cash equivalents and short-term investment securities | 0 | 0 |
Fair Value, Inputs, Level 1 [Member] | Money Market Funds [Member] | ||
Assets | ||
Total cash equivalents and short-term investment securities | 2,496,646 | 41,526,540 |
Fair Value, Inputs, Level 1 [Member] | Commercial Paper [Member] | ||
Assets | ||
Total cash equivalents and short-term investment securities | 0 | |
Fair Value, Inputs, Level 2 [Member] | U.S. government agency bonds [Member] | ||
Assets | ||
Total cash equivalents and short-term investment securities | 8,755,522 | 1,998,040 |
Fair Value, Inputs, Level 2 [Member] | US Treasury Securities [Member] | ||
Assets | ||
Total cash equivalents and short-term investment securities | 0 | |
Fair Value, Inputs, Level 2 [Member] | Warrant Liability [Member] | ||
Liabilities | ||
Warrant liability | 0 | 0 |
Fair Value, Inputs, Level 2 [Member] | Short-term investment securities [Member] | ||
Assets | ||
Total cash equivalents and short-term investment securities | 3,000,000 | 6,000,000 |
Fair Value, Inputs, Level 2 [Member] | Corporate Bonds [Member] | ||
Assets | ||
Total cash equivalents and short-term investment securities | 30,700,272 | 9,450,933 |
Fair Value, Inputs, Level 2 [Member] | Cash Equivalents and Short-term Investment Securities [Member] | ||
Assets | ||
Total cash equivalents and short-term investment securities | 49,385,899 | 20,448,973 |
Fair Value, Inputs, Level 2 [Member] | Certificates of Deposit [Member] | ||
Assets | ||
Total cash equivalents and short-term investment securities | 4,000,000 | 3,000,000 |
Fair Value, Inputs, Level 2 [Member] | Money Market Funds [Member] | ||
Assets | ||
Total cash equivalents and short-term investment securities | 0 | 0 |
Fair Value, Inputs, Level 2 [Member] | Commercial Paper [Member] | ||
Assets | ||
Total cash equivalents and short-term investment securities | 2,930,105 | |
Fair Value, Inputs, Level 3 [Member] | U.S. government agency bonds [Member] | ||
Assets | ||
Total cash equivalents and short-term investment securities | 0 | 0 |
Fair Value, Inputs, Level 3 [Member] | US Treasury Securities [Member] | ||
Assets | ||
Total cash equivalents and short-term investment securities | 0 | |
Fair Value, Inputs, Level 3 [Member] | Warrant Liability [Member] | ||
Liabilities | ||
Warrant liability | 167,779 | 216,490 |
Fair Value, Inputs, Level 3 [Member] | Short-term investment securities [Member] | ||
Assets | ||
Total cash equivalents and short-term investment securities | 0 | 0 |
Fair Value, Inputs, Level 3 [Member] | Corporate Bonds [Member] | ||
Assets | ||
Total cash equivalents and short-term investment securities | 0 | 0 |
Fair Value, Inputs, Level 3 [Member] | Cash Equivalents and Short-term Investment Securities [Member] | ||
Assets | ||
Total cash equivalents and short-term investment securities | 0 | 0 |
Fair Value, Inputs, Level 3 [Member] | Certificates of Deposit [Member] | ||
Assets | ||
Total cash equivalents and short-term investment securities | 0 | 0 |
Fair Value, Inputs, Level 3 [Member] | Money Market Funds [Member] | ||
Assets | ||
Total cash equivalents and short-term investment securities | 0 | $ 0 |
Fair Value, Inputs, Level 3 [Member] | Commercial Paper [Member] | ||
Assets | ||
Total cash equivalents and short-term investment securities | $ 0 |
WARRANTS FOR COMMON STOCK (Narr
WARRANTS FOR COMMON STOCK (Narrative) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | ||
Class of Warrant or Right [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net, Total | $ 48,711 | $ (5,344) | ||
Number Of Warrants Exercised | (1,470,027) | |||
Warrants Expired And Unexercised | 223,814 | |||
Number Of Warrants Exercised On Cashless Basis | 1,286,277 | |||
Number of noncash warrants exercised | [1] | 700,148 | ||
Common Stock [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 11,387,932 | |||
June Offering [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 2.15 | |||
Warrants Expiration Period | 5 years | |||
June 2017 Warrants Pursuant to Warrant One Exercise Agreements [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 2.15 | |||
Number Of Warrants Issued | 11,293,211 | |||
Warrant [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Number Of Warrants Exercised | 12,763,238 | |||
Warrants With Provision Of Anti Dilution [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 94,721 | |||
[1] | Includes anti-dilution features. |
WARRANTS FOR COMMON STOCK (Outs
WARRANTS FOR COMMON STOCK (Outstanding Warrants) (Details) - $ / shares | 3 Months Ended | |||
Mar. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | ||
Class of Warrant or Right [Line Items] | ||||
Number of warrants | 11,387,932 | 12,088,080 | 13,781,921 | |
August 2012 Convertible Notes Payable Warrants One [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Number of warrants | [1] | 94,721 | ||
Exercise Price | [1] | $ 0.931 | ||
Expiration | [1] | Aug. 8, 2018 | ||
June 2017 Warrants Pursuant to Warrant One Exercise Agreements [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Number of warrants | 11,293,211 | |||
Exercise Price | $ 2.15 | |||
Expiration | Dec. 20, 2022 | |||
[1] | Includes anti-dilution features. |
WARRANTS FOR COMMON STOCK (Roll
WARRANTS FOR COMMON STOCK (Roll-Forward of Warrant Liability from Initial Valuation) (Details) - USD ($) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2018 | Dec. 31, 2017 | |
Class of Warrant or Right [Line Items] | ||
Warrant liability, Fair value | $ 216,490 | $ 58,681 |
Gain as a result of change in fair value | (48,711) | |
Loss as a result of change in fair value | 157,809 | |
Warrant liability, Fair value | $ 167,779 | $ 216,490 |
WARRANTS FOR COMMON STOCK (Warr
WARRANTS FOR COMMON STOCK (Warrant Activity) (Details) - shares | 3 Months Ended | 12 Months Ended |
Mar. 31, 2018 | Dec. 31, 2017 | |
Class of Warrant or Right [Line Items] | ||
Warrant outstanding beginning balance | 12,088,080 | 13,781,921 |
Warrants exercised | (1,470,027) | |
Warrants expired | (223,814) | |
Warrant outstanding ending balance | 11,387,932 | 12,088,080 |
Composition of outstanding warrants: | ||
Warrants containing anti-dilution feature | 94,721 | |
Warrants Without Provision Of Anti Dilution | 11,293,211 | |
Warrant outstanding and exercisable ending balance | 11,387,932 | |
June 2017 Warrants Pursuant to Warrant Exercise Agreements [Member] | ||
Class of Warrant or Right [Line Items] | ||
Warrants issued | 11,293,211 | |
Warrants exercised | (11,293,211) | |
March 2018 Offering [Member] | ||
Class of Warrant or Right [Line Items] | ||
Warrants exercised | (700,148) |
COMMITMENTS AND CONTINGENCIES42
COMMITMENTS AND CONTINGENCIES (Narrative) (Details) - USD ($) | Oct. 04, 2017 | Aug. 14, 2017 | Mar. 13, 2017 | Dec. 08, 2015 | Feb. 10, 2014 | Feb. 28, 2018 | Apr. 26, 2017 | Jan. 31, 2017 | Sep. 28, 2015 | Sep. 15, 2014 | Aug. 27, 2014 | Aug. 22, 2014 | Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Aug. 14, 2018 | Feb. 21, 2018 | Dec. 31, 2017 | Dec. 28, 2017 | Feb. 01, 2017 | May 19, 2016 | May 01, 2016 | Apr. 26, 2016 | Apr. 12, 2014 |
Other Commitments [Line Items] | ||||||||||||||||||||||||||||
Annual minimum royalty payments | $ 225,000 | $ 1,219 | $ 1,471 | |||||||||||||||||||||||||
Milestone payment upon approval of a product | 150,000 | |||||||||||||||||||||||||||
Research and Development Expense, Total | 2,516,769 | $ 550,851 | ||||||||||||||||||||||||||
License Costs | $ 85,681 | |||||||||||||||||||||||||||
Amortization of Other Deferred Charges | 167,552 | 140,888 | ||||||||||||||||||||||||||
Lease Payments | 42,000 | 38,000 | ||||||||||||||||||||||||||
License Maintenance Fees Due Current | $ 75,000 | |||||||||||||||||||||||||||
Operating Leases, Future Minimum Payments Due, Next Twelve Months | 127,000 | |||||||||||||||||||||||||||
Operating Leases, Future Minimum Payments, Due in Two Years | 169,000 | |||||||||||||||||||||||||||
Operating Leases, Future Minimum Payments, Due in Three Years | 169,000 | |||||||||||||||||||||||||||
Minimum Annual Royalties In Year Four | $ 25,000 | $ 25,000 | ||||||||||||||||||||||||||
Minimum Annual Royalties After Year Four | 50,000 | |||||||||||||||||||||||||||
Minimum Annual Royalties In Year Three | $ 25,000 | |||||||||||||||||||||||||||
Litigation Settlement Shares To Be Issued | 2,077,555 | 2,077,555 | 2,077,555 | |||||||||||||||||||||||||
Minimum Annual Royalties In Year One | $ 10,000 | |||||||||||||||||||||||||||
Minimum Annual Royalties In Year Two | $ 15,000 | |||||||||||||||||||||||||||
Operating Leases Monthly lease payment | $ 5,760 | |||||||||||||||||||||||||||
Loss Contingency, Receivable | 18,000,000 | |||||||||||||||||||||||||||
Royalty Guarantees, Commitments, Amount | 225,000 | 1,219 | $ 1,471 | |||||||||||||||||||||||||
Research and Development Arrangement [Member] | ||||||||||||||||||||||||||||
Other Commitments [Line Items] | ||||||||||||||||||||||||||||
License Costs | $ 88,344 | |||||||||||||||||||||||||||
Long-term Purchase Commitment, Amount | $ 785,100 | |||||||||||||||||||||||||||
University of Virginia [Member] | ||||||||||||||||||||||||||||
Other Commitments [Line Items] | ||||||||||||||||||||||||||||
Research and Development Expense, Total | 103,967 | 40,845 | ||||||||||||||||||||||||||
Research and Development Arrangement, Investment Amount | 1,000,000 | |||||||||||||||||||||||||||
Payment One [Member] | ||||||||||||||||||||||||||||
Other Commitments [Line Items] | ||||||||||||||||||||||||||||
Research and Development Arrangement, Contract to Perform for Others, Costs Incurred, Gross | $ 65,425 | $ 379,800 | ||||||||||||||||||||||||||
Payment Two [Member] | ||||||||||||||||||||||||||||
Other Commitments [Line Items] | ||||||||||||||||||||||||||||
Research and Development Arrangement, Contract to Perform for Others, Costs Incurred, Gross | $ 130,850 | 65,425 | ||||||||||||||||||||||||||
Office space in Clarence, New York [Member] | ||||||||||||||||||||||||||||
Other Commitments [Line Items] | ||||||||||||||||||||||||||||
Operating Leases, Rent Expense, Minimum Rentals | $ 6,375 | |||||||||||||||||||||||||||
Lessee, Operating Lease, Term | 1 year | |||||||||||||||||||||||||||
Lessee, Operating Lease, Renewal Term | 3 years | |||||||||||||||||||||||||||
Warehouse Space in North Carolina [Member] | ||||||||||||||||||||||||||||
Other Commitments [Line Items] | ||||||||||||||||||||||||||||
Operating Leases, Future Minimum Payments Due, Next Twelve Months | 57,000 | |||||||||||||||||||||||||||
Operating Leases, Future Minimum Payments, Due in Two Years | 76,000 | |||||||||||||||||||||||||||
Operating Leases, Future Minimum Payments, Due in Three Years | $ 76,000 | |||||||||||||||||||||||||||
Lease And Rental Expense | $ 4,665 | |||||||||||||||||||||||||||
Future Minimum Sublease Rentals, Sale Leaseback Transactions, within Two Years | $ 56,000 | |||||||||||||||||||||||||||
Laboratory space in Buffalo [Member] | ||||||||||||||||||||||||||||
Other Commitments [Line Items] | ||||||||||||||||||||||||||||
Annual minimum royalty payments | 2,690 | |||||||||||||||||||||||||||
Operating Leases, Future Minimum Payments Due, Next Twelve Months | $ 52,000 | |||||||||||||||||||||||||||
Operating Leases, Future Minimum Payments, Due in Two Years | $ 34,000 | |||||||||||||||||||||||||||
Operating Leases, Rent Expense, Sublease Rentals | $ 2,770 | |||||||||||||||||||||||||||
Royalty Guarantees, Commitments, Amount | $ 2,690 | |||||||||||||||||||||||||||
Licensing Agreements [Member] | ||||||||||||||||||||||||||||
Other Commitments [Line Items] | ||||||||||||||||||||||||||||
Research and Development Expense, Total | $ 162,408 | $ 137,232 | 75,000 | |||||||||||||||||||||||||
Licensing Agreements One [Member] | ||||||||||||||||||||||||||||
Other Commitments [Line Items] | ||||||||||||||||||||||||||||
Research and Development Expense, Total | 63,390 | |||||||||||||||||||||||||||
License Costs | $ 150,000 | $ 125,000 | ||||||||||||||||||||||||||
License Maintenance Fees Due Current | 15,000 | $ 15,000 | ||||||||||||||||||||||||||
Minimum Royalty Fee Payments Due In Year Two | $ 30,000 | |||||||||||||||||||||||||||
Minimum Royalty Fee Payments Due Thereafter | 50,000 | |||||||||||||||||||||||||||
Capitalized Patent Costs Gross | 4,470 | 19,069 | ||||||||||||||||||||||||||
Minimum Royalty Fee Payments Due In Year One | 20,000 | |||||||||||||||||||||||||||
Patents [Member] | ||||||||||||||||||||||||||||
Other Commitments [Line Items] | ||||||||||||||||||||||||||||
Capitalized Patent Costs Gross | 29,262 | 26,843 | ||||||||||||||||||||||||||
Precision License [Member] | ||||||||||||||||||||||||||||
Other Commitments [Line Items] | ||||||||||||||||||||||||||||
License Costs | $ 1,250,000 | |||||||||||||||||||||||||||
Amortization of Other Deferred Charges | 24,506 | 24,506 | ||||||||||||||||||||||||||
Anandia Sublicense [Member] | ||||||||||||||||||||||||||||
Other Commitments [Line Items] | ||||||||||||||||||||||||||||
License Costs | $ 10,000 | |||||||||||||||||||||||||||
Upfront Fee | $ 75,000 | |||||||||||||||||||||||||||
Licensing Agreements Two [Member] | ||||||||||||||||||||||||||||
Other Commitments [Line Items] | ||||||||||||||||||||||||||||
Capitalized Patent Costs Gross | 0 | 29,667 | ||||||||||||||||||||||||||
Modified Risk Tobacco Products Application [Member] | ||||||||||||||||||||||||||||
Other Commitments [Line Items] | ||||||||||||||||||||||||||||
Annual minimum royalty payments | 8,000,000 | |||||||||||||||||||||||||||
License Costs | 1,296,000 | $ 0 | ||||||||||||||||||||||||||
Royalty Guarantees, Commitments, Amount | $ 8,000,000 |
COMMITMENTS AND CONTINGENCIES43
COMMITMENTS AND CONTINGENCIES (Future Minimum Lease Payments) (Details) | Mar. 31, 2018USD ($) |
Other Commitments [Line Items] | |
Year ended December 31, 2018 - | $ 127,000 |
Year ended December 31, 2019 - | 169,000 |
Year ended December 31, 2020 - | 169,000 |
Year ended December 31, 2021 - | $ 141,000 |
EARNINGS PER COMMON SHARE (Comp
EARNINGS PER COMMON SHARE (Computation of Basic and Diluted Earnings Per Common Share) (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Net income (loss) attributed to common shareholders | $ 1,386,488 | $ (2,621,277) |
Denominator for basic earnings per share-weighted average shares outstanding | 124,019,946 | 90,699,874 |
Effect of dilutive securities: | ||
Warrants and options outstanding | 20,144,492 | 0 |
Denominator for diluted earnings per common share-weighted average shares adjusted for dilutive securities | 144,164,438 | 90,699,874 |
Net income (loss) per common share - basic and diluted | $ 0.01 | $ (0.03) |
EARNINGS PER COMMON SHARE (Anti
EARNINGS PER COMMON SHARE (Anti-Dilutive Securities Outstanding Excluded from Computation) (Details) - shares | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Securities outstanding but excluded from computation of earnings per share | 20,144,492 | 19,057,370 |
Warrants [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Securities outstanding but excluded from computation of earnings per share | 11,387,932 | 13,406,691 |
Options [ Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Securities outstanding but excluded from computation of earnings per share | 8,756,560 | 5,650,679 |
EQUITY BASED COMPENSATION (Narr
EQUITY BASED COMPENSATION (Narrative) (Details) - USD ($) | Apr. 12, 2014 | Apr. 29, 2017 | Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Equity based employee compensation expense | $ 563,876 | $ 168,979 | ||||||
Unrecognized compensation expense related to non-vested restricted shares and stock option | $ 433,000 | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value | $ 1.82 | |||||||
Proceeds from Stock Options Exercised | $ 217,500 | 0 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested in Period, Fair Value | $ 235,715 | 562,715 | ||||||
Common Stock [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | 315,540 | |||||||
Omnibus Incentive Plan [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Share-Based Compensation Arrangement By Share-Based Payment Award, Number Of Shares Authorized | 5,000,000 | |||||||
Equity based employee compensation expense | $ 563,876 | $ 168,979 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 1,131,841 | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Additional Shares Authorized | 5,000,000 | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant | 1,802,115 | |||||||
Omnibus Incentive Plan [Member] | Common Stock [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 10,000,000 | |||||||
Scenario, Forecast [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Unrecognized compensation expense related to non-vested restricted shares and stock option | $ 98,000 | $ 698,000 | $ 1,064,000 | $ 2,509,000 | ||||
Employee Stock Option [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Unrecognized compensation expense related to non-vested restricted shares and stock option | $ 447,000 | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | 327,781 | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Net of Forfeitures, Total | 1,131,841 | |||||||
Non vested stock options [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Unrecognized compensation expense related to non-vested restricted shares and stock option | $ 5,249,000 |
EQUITY BASED COMPENSATION (Sche
EQUITY BASED COMPENSATION (Schedule of Fair Value Assumptions) (Details) | 3 Months Ended |
Mar. 31, 2018 | |
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | |
Risk-free interest rate (weighted average) | 2.67% |
Expected dividend yield | 0.00% |
Expected stock price volatility | 90.00% |
Expected life of options (weighted average) | 5 years 5 months 12 days |
EQUITY BASED COMPENSATION (Summ
EQUITY BASED COMPENSATION (Summary of All Stock Option Activity) (Details) - Employee Stock Option [Member] - USD ($) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2018 | Dec. 31, 2017 | |
Number of Options | ||
Options Outstanding, Beginning of Period | 8,156,691 | 5,650,679 |
Granted | 1,131,841 | 2,692,000 |
Exercised | (327,781) | (85,988) |
Expired | (204,191) | (100,000) |
Options Outstanding, End of Period | 8,756,560 | 8,156,691 |
Exercisable, End of Period | 3,623,471 | |
Weighted Average Exercise Price | ||
Options Outstanding, Beginning of Period | $ 1.28 | $ 1.04 |
Granted | 2.76 | 1.76 |
Exercised | 0.81 | 0.79 |
Expired | 1.11 | 1.43 |
Options Outstanding, End of Period | 1.49 | $ 1.28 |
Exercisable, End of Period | $ 1.11 | |
Weighted Average Remaining Contractual Term | ||
Options Outstanding, End of Period | 7 years 3 months 18 days | |
Exercisable, End of Period | 5 years 9 months 18 days | |
Aggregate Intrinsic Value | ||
Options Outstanding, End of Period | $ 7,847,766 | |
Exercisable, End of Period | $ 4,563,638 |
SUBSEQUENT EVENTS (Narrative) (
SUBSEQUENT EVENTS (Narrative) (Details) - USD ($) | 1 Months Ended | |
Oct. 31, 2017 | Mar. 31, 2018 | |
Subsequent Event [Line Items] | ||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Total | $ 433,000 | |
Employee Stock Option One [Member] | Vice President [Member] | ||
Subsequent Event [Line Items] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested, Number of Shares | 900,000 | |
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price | $ 2.12 | |
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Total | 1,227,000 | |
Employee Stock Option Two [Member] | Vice President [Member] | ||
Subsequent Event [Line Items] | ||
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price | $ 2.12 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Number of Shares | 300,000 | |
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Total | $ 443,000 |