Document And Entity Information
Document And Entity Information - shares | 3 Months Ended | |
Mar. 31, 2023 | May 08, 2023 | |
Cover [Abstract] | ||
Entity Central Index Key | 0001357459 | |
Entity Registrant Name | PALISADE BIO, INC. | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2023 | |
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2023 | |
Document Transition Report | false | |
Entity File Number | 001-33672 | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 52-2007292 | |
Entity Address, Address Line One | 7750 El Camino Real, Suite 2A | |
Entity Address, City or Town | Carlsbad | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 92009 | |
City Area Code | 858 | |
Local Phone Number | 704-4900 | |
Title of 12(b) Security | Common Stock, $0.01 par value | |
Trading Symbol | PALI | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 6,696,982 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) | Mar. 31, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 13,297,000 | $ 12,383,000 |
Accounts Receivable | 250,000 | 0 |
Prepaid expenses and other current assets | 762,000 | 2,350,000 |
Total current assets | 14,309,000 | 14,733,000 |
Restricted cash | 26,000 | 26,000 |
Property and equipment, net | 9,000 | 10,000 |
Right-of-use asset | 275,000 | 300,000 |
Other noncurrent assets | 643,000 | 694,000 |
Total assets | 15,262,000 | 15,763,000 |
Current liabilities: | ||
Accounts payable | 706,000 | 1,759,000 |
Accrued liabilities | 309,000 | 574,000 |
Accrued compensation and benefits | 191,000 | 486,000 |
Current portion of lease liability | 109,000 | 105,000 |
Debt | 0 | 88,000 |
Total current liabilities | 1,315,000 | 3,012,000 |
Warrant liability | 18,000 | 61,000 |
Lease liability, net of current portion | 182,000 | 211,000 |
Total liabilities | 1,515,000 | 3,284,000 |
Commitments and contingencies (Note11) | ||
Stockholders' equity: | ||
Common stock, $0.01 par value; 280,000,000 shares authorized; 4,563,977 and 2,944,306 shares issued and outstanding at March 31, 2023 and December 31, 2022, respectively | 46,000 | 30,000 |
Additional paid-in capital | 125,229,000 | 121,637,000 |
Accumulated deficit | (111,530,000) | (109,190,000) |
Total stockholders' equity | 13,747,000 | 12,479,000 |
Total liabilities and stockholders' equity | 15,262,000 | 15,763,000 |
Series A Preferred Stock [Member] | ||
Stockholders' equity: | ||
Series A convertible Preferred Stock, $0.01 par value, 7,000,000 shares authorized; 200,000 issued and outstanding at March 31, 2023 and December 31, 2022 | $ 2,000 | $ 2,000 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Mar. 31, 2023 | Dec. 31, 2022 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 280,000,000 | 280,000,000 |
Common stock, shares issued (in shares) | 4,563,977 | 2,944,306 |
Common stock, shares outstanding (in shares) | 4,563,977 | 2,944,306 |
Series A Preferred Stock [Member] | ||
Preferred stock, shares authorized (in shares) | 7,000,000 | 7,000,000 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares issued (in shares) | 200,000 | 200,000 |
Preferred stock, shares outstanding (in shares) | 200,000 | 200,000 |
Common stock, shares issued (in shares) | 200,000 | |
Common stock, shares outstanding (in shares) | 200,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | ||
Operating expenses: | |||
License revenue | $ 250 | $ 0 | |
Research and development | 1,241 | 959 | |
General and administrative | 1,538 | 2,929 | |
Total operating expenses | 2,779 | 3,888 | |
Loss from operations | (2,529) | (3,888) | |
Other income (expense): | |||
Interest expense | 0 | (1) | |
Other income | 189 | 794 | |
Loss on issuance of warrants | 0 | (1,110) | |
Total other income (expense), net | 189 | (317) | |
Net loss | $ (2,340) | $ (4,205) | |
(Loss) income per common share: | |||
Basic loss per common share | [1] | $ (0.54) | $ (12.96) |
Diluted loss per common share | [1] | $ (0.54) | $ (12.96) |
Weighted average shares used in computing (loss) income per common share: | |||
Basic weighted average shares used in computing loss per common share | [1] | 4,315,526 | 324,473 |
Diluted weighted average shares used in computing loss per common share | [1] | 4,315,526 | 324,473 |
[1] (*) Basic and diluted loss per common share and basic and diluted weighted average share used in computing basic and diluted loss per common share for the three months ended March 31, 2022 have been adjusted to reflect the 1-for-50 reverse stock split effected on November 16, 2022. |
Condensed Consolidated Statem_2
Condensed Consolidated Statements Convertible Preferred Stock and Stockholders' Equity (Deficit) (Unaudited) - USD ($) $ in Thousands | Total | Preferred Stock Member | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] |
Balance (in shares) at Dec. 31, 2021 | 200,000 | 284,780 | |||
Balance at Dec. 31, 2021 | $ 7,365 | $ 2 | $ 3 | $ 102,002 | $ (94,642) |
Net loss | (4,205) | (4,205) | |||
Stock-based compensation expense | 358 | 358 | |||
Issuance of common stock upon warrant exercises (in shares) | 79,886 | ||||
Issuance of common stock upon warrant exercises | 1,274 | $ 1 | 1,273 | ||
Balance (in shares) at Mar. 31, 2022 | 200,000 | 364,666 | |||
Balance at Mar. 31, 2022 | 4,792 | $ 2 | $ 4 | 103,633 | (98,847) |
Balance (in shares) at Dec. 31, 2022 | 200,000 | 2,944,306 | |||
Balance at Dec. 31, 2022 | 12,479 | $ 2 | $ 30 | 121,637 | (109,190) |
Net loss | (2,340) | (2,340) | |||
Stock-based compensation expense | 93 | 93 | |||
Issuance of common stock upon warrant exercises (in shares) | 1,142,829 | ||||
Issuance of common stock upon warrant exercises | 1,349 | $ 11 | 1,338 | ||
Issuance of common stock warrants related to promissory note (in shares) | 476,842 | ||||
Issuance of common stock warrants related to promissory note | 2,166 | $ 5 | 2,161 | ||
Balance (in shares) at Mar. 31, 2023 | 200,000 | 4,563,977 | |||
Balance at Mar. 31, 2023 | $ 13,747 | $ 2 | $ 46 | $ 125,229 | $ (111,530) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements Convertible Preferred Stock and Stockholders' Equity (Deficit) (Unaudited) (Parenthetical) $ in Thousands | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Payment of equity issuance costs | $ 413 |
Common Stock | |
Payment of equity issuance costs | $ 507 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Net loss | $ (2,340,000) | $ (4,205,000) | |
Adjustments to reconcile net loss to net cash used in operating activities | |||
Depreciation and amortization | 1,000 | 1,000 | |
Noncash lease expense | 25,000 | 45,000 | |
Loss on issuance of warrants | 0 | 1,110,000 | |
Change in fair value of warrant liabilities | (43,000) | (793,000) | |
Stock-based compensation | 93,000 | 358,000 | |
Changes in operating assets and liabilities | |||
Accounts receivable | (250,000) | 0 | |
Prepaid and other assets and other noncurrent assets | 278,000 | 265,000 | |
Accounts payable and accrued liabilities | (970,000) | (59,000) | |
Accrued compensation | (295,000) | (439,000) | |
Operating lease liabilities | (25,000) | (47,000) | |
Net cash used in operating activities | (3,526,000) | (3,764,000) | |
Cash flows from financing activities | |||
Payments on debt | (88,000) | (87,000) | |
Proceeds from issuance of common stock and warrants | 2,231,000 | 0 | |
Proceeds from the exercise of warrants | 2,710,000 | 0 | |
Payment of equity issuance costs | (413,000) | 0 | |
Net cash provided by (used in) financing activities | 4,440,000 | (87,000) | |
Net increase (decrease) in cash, cash equivalents and restricted cash | 914,000 | (3,851,000) | |
Cash, cash equivalents and restricted cash, beginning of year | 12,409,000 | 10,521,000 | $ 10,521,000 |
Cash, cash equivalents and restricted cash, end of period | 13,323,000 | 6,670,000 | 12,409,000 |
Reconciliation of cash, cash equivalents and restricted cash to the balance sheets | |||
Cash and cash equivalents | 13,297,000 | 6,644,000 | 12,383,000 |
Restricted cash | 26,000 | 26,000 | |
Total cash, cash equivalents and restricted cash | 13,323,000 | 6,670,000 | 12,409,000 |
Supplemental disclosures of non-cash investing and financing activities | |||
Equity issuance costs included in accounts payable and accrued liabilities | 12,000 | 82,000 | |
Issuance of common stock for the cashless exercise of warrants | 0 | 1,274,000 | |
Fair value of warrants issued to placement agent | 173,000 | 0 | |
Cash receivable for exercises of warrants included in prepaid and other current assets | $ 47,600 | $ 0 | $ 1,400,000 |
Note 1 - Organization, Business
Note 1 - Organization, Business and Financial Condition | 3 Months Ended |
Mar. 31, 2023 | |
Disclosure Text Block [Abstract] | |
Organization, Business and Financial Condition | 1. Organization, Business and Financial Condition The Merger On April 27, 2021, Leading Biosciences, Inc. (“LBS”) became a wholly owned subsidiary of Seneca Biopharma Inc. (“Seneca”) in accordance with the terms of the agreement and plan of merger and reorganization, dated as of December 16, 2020, (the “Merger Agreement”) by and among Seneca, Townsgate Acquisition Sub 1, Inc., a wholly owned subsidiary of Seneca (“Merger Sub”), and LBS, pursuant to which Merger Sub merged with and into LBS, with LBS surviving as a wholly owned subsidiary of Seneca (the “Merger”). Concurrent with the closing of the Merger, LBS outstanding common stock, common stock warrants and stock options for the purchase of LBS common stock were exchanged for Seneca common stock, Seneca common stock warrants, and options for the purchase of Seneca common stock, at a ratio of 0.02719 shares of LBS common stock equivalents to one share of Seneca common stock equivalents (the “Exchange Ratio”). Immediately following the Merger, Seneca changed its name to “Palisade Bio, Inc.” Unless the context otherwise requires, references to the “Company,” “Palisade,” “Palisade Bio,” “we,” “our” or “us” in this report refer to Palisade Bio, Inc. and its subsidiaries. In addition, references to “Seneca” or “LBS” refer to these entities prior to the completion of the Merger. Description of Business The Company is a biopharmaceutical company focused on developing therapeutics that protect the integrity of the intestinal barrier. The Company's lead therapeutic candidate, LB1148, is a novel oral liquid formulation of the well-characterized digestive enzyme inhibitor tranexamic acid (“TXA”) that is currently being developed for administration prior to surgeries that are at risk of disrupting the intestinal epithelial barrier. By inhibiting the activity of digestive proteases, the Company believes that LB1148 has the potential to reduce the formation of postoperative adhesions between intra-abdominal tissues and accelerate the time to the return of normal gastrointestinal ("GI") function. Liquidity and Going Concern The Company has a limited operating history, and the sales and income potential of the Company’s business and market are unproven. The Company has experienced losses and negative cash flows from operations since its inception. At March 31, 2023, the Company had an accumulated deficit of $ 111.5 million and cash and cash equivalents of $ 13.3 million. The Company expects to continue to incur losses into the foreseeable future. The successful transition to attaining profitable operations is dependent upon achieving a level of revenues adequate to support the Company’s cost structure. Based on the Company’s current working capital, anticipated operating expenses, and anticipated net operating losses, there is substantial doubt about the Company's ability to continue as a going concern for a period of one year following the date that these condensed consolidated financial statements are issued. The condensed consolidated financial statements have been prepared assuming the Company will continue as a going concern, which contemplates the realization of assets and settlement of liabilities in the normal course of business. The condensed consolidated financial statements do not include any adjustments for the recovery and classification of assets or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. Historically, the Company has funded its operations primarily through a combination of debt and equity financings. The Company plans to continue to fund its operations through cash and cash equivalents on hand, as well as through future equity offerings, debt financings, other third-party funding, and potential licensing or collaboration arrangements. Refer to Note 6, Stockholders' Equity (Deficit) and Note 11, Subsequent Events, for discussion of the recent financings undertaken by the Company. There can be no assurance that additional funds will be available when needed from any source or, if available, will be available on terms that are acceptable to the Company. Even if the Company raises additional capital, it may also be required to modify, delay or abandon some of its plans which could have a material adverse effect on the Company’s business, operating results and financial condition and the Company’s ability to achieve its intended business objectives. Any of these actions could materially harm the Company’s business, results of operations and future prospects . |
Note 2 - Summary of Significant
Note 2 - Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Basis of Presentation and Consolidation In management’s opinion, the accompanying interim condensed consolidated financial statements include all adjustments, consisting of normal recurring adjustments, which are necessary to present fairly the Company's financial position, results of operations and cash flows. The interim results of operations are not necessarily indicative of the results that may occur for the full year. Certain information and note disclosures normally included in the consolidated financial statements prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) have been condensed or omitted pursuant to instructions, rules and regulations prescribed by the U.S. Securities and Exchange Commission (“SEC”). The Company believes that the disclosures provided herein are adequate to make the information presented not misleading when these condensed consolidated financial statements are read in conjunction with the condensed consolidated financial statements and notes included in the Company’s financial statements filed on the Annual Report on Form 10-K for the year ended December 31, 2022, which was filed with the SEC on March 22, 2023. Certain prior period amounts in the condensed consolidated financial statements and accompanying notes have been reclassified to conform to the current period’s presentation. The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, Leading Biosciences, Inc. and Suzhou Neuralstem Biopharmaceutical Co., Ltd. All the entities are consolidated in the Company's condensed consolidated financial statements and all intercompany activity and transactions, if any, have been eliminated . Reverse Stock Split On November 15, 2022, the Company effected a 1-for-50 reverse stock split of its issued and outstanding common stock (the "Reverse Stock Split"). As a result of the Reverse Stock Split, each of the Company’s shareholders received one new share of common stock for every 50 shares such shareholder held immediately prior to the effective time of the Reverse Stock Split. The Reverse Stock Split affected all the Company’s issued and outstanding shares of common stock equally. The par value and authorized shares of the Company's common stock was not adjusted as a result of the Reverse Stock Split. The Reverse Split also affected the Company’s outstanding stock options, common stock warrants and other exercisable or convertible securities and resulted in the shares underlying such instruments being reduced and the exercise price being increased proportionately. Unless otherwise noted, all common stock shares, common stock per share data and shares of common stock underlying convertible preferred stock, stock options and common stock warrants included in these condensed consolidated financial statements, including the exercise price of such equity instruments, as applicable, have been retrospectively adjusted to reflect the effect of the Reverse Stock Split for all periods presented. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires the Company to make estimates, judgments, and assumptions that impact the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the balance sheet, and the reported amounts of expenses during the reporting period. The most significant estimates in the Company’s condensed consolidated financial statements relate to clinical trial accruals and its derivative financial instruments. Although these estimates are based on the Company’s knowledge of current events and actions it may undertake in the future, actual results may materially differ from these estimates and assumptions. Segment Information Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision maker, the Chief Executive Officer, in making decisions regarding resource allocation and assessing performance. The Company views its operations and manages its business as one operating segment, which consists of research and development activities. Cash and Cash Equivalents Cash and cash equivalents represent cash available in readily available checking and money market accounts. The Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. Restricted Cash As of March 31, 2023 and December 31, 2022, the Company held restricted cash of $ 26,000 , in a separate restricted bank account as collateral for the Company’s corporate credit card program. The Company has classified these deposits as long-term restricted cash on its condensed consolidated balance sheets . Deferred Equity Issuance Costs Deferred equity issuance costs consist of the legal, accounting and other direct and incremental costs incurred by the Company related to its equity offerings (See Note 11, Subsequent Events) or shelf registration statement. As of March 31, 2023 and December 31, 2022, deferred equity issuance costs of $ 93,000 and $ 114,000 , respectively, w ere included in prepaid and other assets in the condensed consolidated balance sheet. These costs will be netted against additional paid-in capital as a cost of the future equity issuances to which they relate. Concentration of Credit Risk Financial instruments, which potentially subject the Company to concentration of credit risk, consist primarily of cash and cash equivalents and accounts receivable. The Company maintains deposits in federally insured financial institutions and in money market accounts, and at times balances may exceed 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 nor has the Company experienced any losses in these accounts. The Company's entire accounts receivable balance as of March 31, 2023 is with the Company co-development partner, Newsoara Biopharma Co., Ltd. (“Newsoara”) (See Note 8, Collaborations and License Agreements). Management believes it is not exposed to significant credit risk on the accounts receivable based on its relationship with Newsoara and Newsoara's history of timely payment of balances owed. In early May 2023, prior to the issuance of these condensed consolidated financial statements, Newsoara has paid the entire balance of the accounts receivable outstanding as of March 31, 2023 . Fair Value of Financial Instruments The Company’s financial instruments consist principally of cash and cash equivalents, restricted cash, accounts receivable, other current receivables, accounts payable, accrued liabilities, debt, and liability-classified warrants. The carrying amounts of financial instruments such as cash equivalents, restricted cash, accounts receivable, other current receivables, accounts payable, and accrued liabilities approximate their related fair values due to the short-term nature of these instruments. The carrying value of the Company’s debt as of December 31, 2022 approximates its fair value due to the market rate of interest, which is based on level 2 inputs. The Company’s derivative financial instruments are carried at fair value based on level 3 inputs as defined below. None of the Company’s non-financial assets or liabilities are recorded at fair value on a nonrecurring basis. The Company follows Accounting Standards Codification ("ASC") 820, Fair Value Measurements and Disclosures , which among other things, defines fair value, establishes a consistent framework for measuring fair value and expands disclosure for each major asset and liability category measured at fair value on either a recurring or nonrecurring basis. Fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, a three-tier fair value hierarchy has been established, which prioritizes the inputs used in measuring fair value as follows: (1) Level 1: observable inputs such as quoted prices (unadjusted) in active markets for identical assets or liabilities; (2) Level 2: inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and (3) Level 3: unobservable inputs for which there is little or no market data, which require the reporting entity to develop its own assumptions, which reflect those that a market participant would use. Further information on the fair value of financial instruments can be found at Note 5, Fair Value Measurements. Derivative Financial Instruments The Company does not use derivative instruments to hedge exposures to cash flow, market, or foreign currency risks. The Company evaluates its financial instruments, including warrants, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. The Company values its derivatives using the Black-Scholes option pricing model or other acceptable valuation models, including the Monte-Carlo simulation model. Derivative instruments are valued at inception, upon events such as an exercise of the underlying financial instrument, and at subsequent reporting periods. The classification of derivative instruments, including whether such instruments should be recorded as liabilities, is reassessed at the end of each reporting period. The Company reviews the terms of debt instruments, equity instruments, and other financing arrangements to determine whether there are embedded derivative features, including embedded conversion options that are required to be bifurcated and accounted for separately as a derivative financial instrument. Additionally, in connection with the issuance of financing instruments, the Company may issue freestanding options and warrants. The Company accounts for its common stock warrants in accordance with ASC 480, Distinguishing Liabilities from Equity ("ASC 480") and ASC 815, Derivatives and Hedging (“ASC 815”). Based upon the provisions of ASC 480 and ASC 815, the Company accounts for common stock warrants as liabilities if the warrant requires net cash settlement or gives the holder the option of net cash settlement, or it fails the equity classification criteria. The Company accounts for common stock warrants as equity if the contract requires physical settlement or net physical settlement or if the Company has the option of physical settlement or net physical settlement and the warrants meet the requirements to be classified as equity. Common stock warrants classified as liabilities are initially recorded at fair value on the grant date and remeasured at fair value at each balance sheet date with the offsetting adjustments recorded in change in fair value of warrant liability within the condensed consolidated statements of operations. If the terms of a common stock warrant previously classified as a liability are amended and pursuant to such amendment meet the requirements to be classified as equity, the common stock warrants are reclassified to equity at the fair value on the date of the amendment and are not subsequently remeasured. Common stock warrants classified as equity are recorded on a relative fair value basis when they are issued with other equity-classified financial instruments . Leases In accordance with ASC 842, Leases , the Company assesses contracts for lease arrangements at inception. Operating right-of-use (“ROU”) assets and liabilities are recognized at the lease commencement date equal to the present value of future lease payments using the implicit, if readily available, or incremental borrowing rate based on the information readily available at the commencement date. ROU assets include any lease payments as of commencement and initial direct costs but exclude any lease incentives. Lease and non-lease components are generally accounted for separately and the Company recognizes operating lease expense straight-line over the term of the lease. Milestone Revenue The Company uses the revenue recognition guidance established by ASC 606, Revenue From Contracts With Customers (“ASC 606”). When an agreement falls under the scope of other standards, such as ASC 808, Collaborative Arrangements , the Company will apply the recognition, measurement, presentation, and disclosure guidance in ASC 606 to the performance obligations in the agreements if those performance obligations are with a customer. The Company currently does not have any collaborative arrangements with counterparties that are also considered customers. For arrangements that include amounts to be paid to the Company upon the achievement of certain development milestones of technology licensed by the Company, the Company recognizes such license revenue using the most likely method. At the end of each reporting period, the Company re-evaluates the probability or achievement of any potential milestones and any related constraints, and if necessary, adjusts its estimates of the overall transaction price. Any such adjustments are recorded on a cumulative catch-up basis, which would affect revenue in the period of adjustment. For the three months ended March 31, 2023 , $ 0.3 million of license revenue related to milestones achieved on licensed technology was recognized as revenue and was reported in accounts receivable as of March 31, 2023, to which the Company has not recorded an allowance for estimated credit losses based on its relationship with the counterparty and the counterparty's history of timely payment of balances owed to the Company (see Note 8, Collaborations and License Agreements). Research and Development Costs Research and development expenses consist primarily of salaries and other personnel related expenses including stock-based compensation costs, preclinical costs, clinical trial costs, costs related to acquiring and manufacturing clinical trial materials, and contract services. All research and development costs are expensed as incurred . Clinical Trial Expenses Expenses related to clinical studies are based on estimates of the services received and efforts expended pursuant to the Company’s contract arrangements. The financial terms of these agreements are subject to negotiation, vary from contract to contract, and may result in uneven payment flows. There may be instances in which payments made to the Company’s service providers will temporarily exceed the level of services provided and result in a prepayment of the clinical expense. Payments under some of these contracts depend on factors such as the successful enrollment of patients, site initiation and the completion of clinical milestones. The Company makes estimates of its accrued expenses as of each balance sheet date in its condensed consolidated financial statements based on facts and circumstances known at that time. In accruing service fees, the Company estimates the time period over which services will be performed and the level of effort to be expended in each period. If the actual timing of the performance of services or the level of effort varies from its estimate, the Company adjusts the accrual or prepaid expense balance accordingly. As of March 31, 2023 and December 31, 2022, the Company has accrued $ 94,000 and $ 184,000 , respectively, in clinical trial expenses for which services have been provided but the Company has not yet been invoiced as of the balance sheet date. Clinical trial expenses are recognized in research and development expenses in the condensed consolidated statements of operations in the period incurred . Patent Costs Costs related to filing and pursuing patent applications (including direct application fees, and the legal and consulting expenses related to making such applications) are expensed as incurred, as recoverability of such expenditures is uncertain. These costs are included in general and administrative expenses in the condensed consolidated statements of operations . Income Taxes The Company follows ASC 740, Income Taxes , or ASC Topic 740 (“ASC 740”), in reporting deferred income taxes. ASC 740 requires a company to recognize deferred tax assets and liabilities for expected future income tax consequences of events that have been recognized in the Company’s condensed consolidated financial statements. Under this method, deferred tax assets and liabilities are determined based on temporary differences between financial statement carrying amounts and the tax basis of assets and liabilities using enacted tax rates in the years in which the temporary differences are expected to reverse. Valuation allowances are provided if, based on the weight of available evidence, it is more likely than not that some of or all the deferred tax assets will not be realized. The Company accounts for uncertain tax positions pursuant to ASC 740, which prescribes a recognition threshold and measurement process for financial statement recognition of uncertain tax positions taken or expected to be taken in a tax return. If the tax position meets this threshold, the benefit to be recognized is measured as the tax benefit having the highest likelihood of being realized upon ultimate settlement with the taxing authority. The Company recognizes interest accrued related to unrecognized tax benefits and penalties in the provision for income taxes. Stock-Based Compensation The Company’s stock-based compensation expense generally includes time-based restricted stock units (“RSUs”) stock options, as well as performance-based RSUs (“PSUs”). The Company accounts for forfeitures as they occur for each type of award as a reduction of expense. Stock-based compensation expense related to time-based RSUs is based on the market value of the underlying stock on the date of grant and the related expense is recognized ratably over the requisite service period, which is usually the vesting period. The Company estimates the fair value of employee and non-employee stock option grants using the Black-Scholes option pricing model. The determination of the fair value of stock-based payment awards on the date of grant using the Black-Scholes option pricing model is affected by the Company's stock price as well as assumptions, which include the expected term of the award, the expected stock price volatility, risk-free interest rate, and expected dividends over the expected term of the award. Stock-based compensation expense represents the cost of the estimated grant date fair value of employee and non-employee stock option grants recognized ratably over the requisite service period of the awards, which is usually the vesting period. For PSUs with vesting subject to market conditions, the fair value of the award is determined at grant date using the Monte Carlo simulation model, and expense is recognized ratably over the requisite service period regardless of whether or not the market condition is satisfied. The Monte Carlo simulation model considers a variety of potential future scenarios under the market condition vesting criteria, including but not limited to share prices for the Company and its peer companies in a selected market index. The Company does not recognize any share-based compensation expense related to conditional RSUs, stock options, or PSUs that are subject to shareholder approval. When and if approval is obtained, the Company recognizes share-based compensation expense related to the conditional equity grants ratably to the vesting of shares over the remaining requisite service period. Net Loss Per Common Share Basic loss per common share is computed by dividing net loss available to common stockholders by the weighted average number of shares of common stock outstanding during the period. The Company's Series A Convertible Preferred Stock and certain of the Company's outstanding warrants contain non-forfeitable rights to dividends with the common stockholders, and therefore are considered to be participating securities. The Series A Convertible Preferred Stock and the warrants do not have a contractual obligation to fund the losses of the Company; therefore, the application of the two-class method is not required when the Company is in a net loss position but is required if the Company is in a net income position. When in a net income position, diluted earnings per share is computed using the more dilutive of the two-class method or the if-converted and treasury stock methods. As the Company was in a loss position for both periods, basic and diluted loss per common share for the three months ended March 31, 2023 and March 31, 2022 were calculated under the if-converted and treasury stock methods. For the three months ended March 31, 2023 and March 31, 2022, basic and diluted loss per common share were the same as all common stock equivalents were anti-dilutive for both periods. The following table presents the calculation of weighted average shares used to calculate basic and diluted loss per share (in thousands, except share and per share amounts): Three Months Ended March 31, 2023 2022 Basic net loss per common share: Net loss $ ( 2,340 ) $ ( 4,205 ) Weighted average shares used in calculating basic loss per common share 4,315,526 324,473 Basic net loss per common share $ ( 0.54 ) $ ( 12.96 ) Diluted net loss per common share: Net loss $ ( 2,340 ) $ ( 4,205 ) Weighted average shares used in calculating diluted loss per common share 4,315,526 324,473 Diluted net loss per common share $ ( 0.54 ) $ ( 12.96 ) The following potentially dilutive securities were excluded from the calculation of diluted net loss per share because their effects would be anti-dilutive: March 31, 2023 2022 Stock options 63,789 30,965 Restricted stock units 42,153 — Warrants for common stock 1,604,421 106,921 Series A Convertible Preferred Stock 129 129 Total 1,710,492 138,015 Comprehensive Loss Comprehensive income (loss) is defined as a change in equity during a period from transactions and other events and circumstances from non-owner sources. The Company’s comprehensive loss was the same as its reported net loss for all periods presented. Recently Adopted Accounting Pronouncements In June 2016, the Financial Accounting Standards Board ("FASB") issued ASU No. 2016-13, Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”). The ASU introduced a new credit loss methodology, the Current Expected Credit Losses (“CECL”) methodology, which requires earlier recognition of credit losses, while also providing additional transparency about credit risk. The CECL methodology utilizes a lifetime “expected credit loss” measurement objective for the recognition of credit losses for loans, held-to maturity debt securities, trade receivables and other receivables measured at amortized cost at the time the financial asset is originated or acquired. After the issuance of ASU 2016-13, the FASB issued several additional ASUs to clarify implementation guidance, provide narrow-scope improvements and provide additional disclosure guidance. In November 2019, the FASB issued an amendment making this ASU effective for fiscal years beginning after December 15, 2022 for smaller reporting companies. The Company adopted this standard as of January 1, 2023 and determined it did not have a material impact on its condensed consolidated financial statements and related disclosures for the three months ended March 31, 2023 . |
Note 3 - Balance Sheet Details
Note 3 - Balance Sheet Details | 3 Months Ended |
Mar. 31, 2023 | |
Disclosure Text Block [Abstract] | |
Balance Sheet Details | 3. Balance Sheet Details Prepaid expenses and other current assets consisted of the following (in thousands): March 31, December 31, 2023 2022 Prepaid insurance $ 355 $ 581 Other receivables 78 1,438 Prepaid subscriptions and fees 193 157 Prepaid software licenses 37 54 Deferred equity issuance costs 93 114 Prepaid other 6 6 $ 762 $ 2,350 Other receivables as of March 31, 2023 and December 31, 2022 includes a $ 47,600 receivable and $ 1.4 million receivable, respectively, for the cash exercise price of common stock purchase warrants that had been exercised but the cash had not yet been received by the Company as of each respective balance sheet date. The entire amount of these other receivables as of March 31, 2023 and December 31, 2022 were received in April 2023 and January 2023, respectively. Other noncurrent assets consisted of the following (in thousands): March 31, December 31, 2023 2022 Prepaid insurance, less current portion $ 631 $ 682 Other noncurrent assets 12 12 $ 643 $ 694 Accrued liabilities consisted of the following (in thousands): March 31, December 31, 2023 2022 Accrued accounts payable $ 73 $ 69 Accrued clinical trial costs 94 184 Accrued director stipends 108 141 Accrued severance and benefits (Note 9) 5 180 Accrued other 29 — $ 309 $ 574 |
Note 4 - Common Stock Warrants
Note 4 - Common Stock Warrants | 3 Months Ended |
Mar. 31, 2023 | |
Disclosure Text Block [Abstract] | |
Common Stock Warrants | 4. Common Stock Warrants The Company’s outstanding common stock warrants that are classified as equity warrants are included as a component of stockholder’s equity (deficit) at the date of grant at the relative fair value at that grant date . Common stock warrants accounted for as liabilities in accordance with the authoritative accounting guidance are included in non-current liabilities. The Company had common stock warrants outstanding of 1,604,421 and 1,055,672 at March 31, 2023 and December 31, 2022 , respectively. Of the Company's common stock warrants exercisable at March 31, 2023 , (i) 278,162 common stock warrants have an exercise price of $ 2.38 , (ii) 1,012,631 common stock warrants have an exercise price of $ 2.375 , (iii) 63,158 common stock warrants have an exercise price of $ 2.9668 and (iv) the remaining 250,470 common stock warrants have a weighted-average exercise price of $ 104.24 . Only the 278,162 common stock warrants outstanding that have an exercise price of $2.38 are subject to down round price reset provisions . Liability-Classified Warrants The Company accounts for certain of its warrants as liability-classified in accordance with ASC 480 and ASC 815. Senior Secured Promissory Note Warrants In connection with the transactions contemplated by the Merger, on December 16, 2020, the Company entered into a securities purchase agreement (the "Securities Purchase Agreement") with an investor (the "Investor") pursuant to which, among other things, the Company agreed to issued warrants to purchase shares of the Company’s common stock (“Senior Secured Promissory Note Warrants”). The Senior Secured Promissory Note Warrants expire five years from the date of registration of the warrants, or August 10, 2026. As of March 31, 2023 , the Senior Secured Promissory Note Warrants outstanding were exercisable for 17,177 shares of the Company’s common stock at an exercise price of $ 194.00 . May 2021 Warrants On May 20, 2021, pursuant to the terms of the Securities Purchase Agreement, the Company issued to the Investor warrants to purchase shares of common stock (the “May 2021 Warrants”). All of the outstanding May 2021 Warrants were exercised by the investor in the fourth quarter of 2021 and the first quarter of 2022 in exchange for 26,186 shares and 79,886 shares of the Company's common stock, respectively. As of March 31, 2023 , there are no May 2021 Warrants outstanding. July 2021 Warrants On July 21, 2021, the Company and the Investor entered into an agreement to waive certain provisions of the previous Security Purchase Agreement (the "July 2021 Waiver Agreement"). As consideration for the July 2021 Waiver Agreement, the Company issued the Investor additional warrants to purchase shares of the Company's common stock (the "July 2021 Warrants"). The July 2021 Warrants expire five years from the date of registration of the warrants, or August 19, 2026. As of March 31, 2023 , the July 2021 Warrants outstanding were exercisable for 22,000 shares of the Company’s common stock at an exercise price of $ 181.50 . January 2022 Warrants On January 31, 2022, the Company and the Investor entered into an agreement to irrevocably waive any adjustment to the exercise price of the Senior Secured Promissory Note Warrants and the May 2021 Warrants held by the Investor from and after January 31, 2022 for the Company's issuances of equity or equity-linked securities at a price below the exercise price of the warrants (the "January 2022 Waiver Agreement"). The waiver of any adjustments to the exercise price of the Senior Secured Promissory Note Warrants and the May 2021 Warrants was considered a modification to those warrants. The modification was determined to have no impact on the valuation of the warrants. As consideration for the foregoing, pursuant to the January 2022 Waiver Agreement, the Company issued the Investor additional warrants to purchase shares of the Company’s common stock (the “January 2022 Warrants”). The initial fair value of the January 2022 Warrants was determined to be $ 1.1 million and is included in loss on issuance of warrants in the consolidated statements of operations for the three months ended March 31, 2022. The January 2022 Warrants expire five and a half years from the date of issuance, or July 31, 2027. As of March 31, 2023 , the January 2022 Warrants outstanding were exercisable for 45,000 shares of the Company’s common stock at an exercise price of $ 55.00 . Equity-Classified Warrants The Company accounts for the majority of its warrants as equity-classified in accordance with ASC 480 and ASC 815. Equity-classified warrants are recorded in equity based on their relative fair value on the date of issuance. January 2023 Registered Direct Offering and Private Placement Warrants In connection with the January 2023 Offering (see Note 6, Stockholders' Equity (Deficit)), on January 4, 2023 the Company issued the (i) 37,000 pre-funded warrants to purchase shares of the Company's common stock at a purchase price of $ 2.3749 , with such warrants having an exercise price of $ 0.0001 per share and a perpetual term (ii) 538,789 pre-funded warrants to purchase shares of the Company's common stock at a purchase price of $ 2.3749 , with such warrants having an exercise price of $ 0.0001 per share and a perpetual term; (iii) 1,052,631 warrants to purchase shares of the Company's common stock at an exercise price of $ 2.375 per share and a term of five years , and (iv) 63,158 warrants to purchase shares of the Company's common stock to the offering placement agent at an exercise price of $ 2.9688 per share and a term of five years . All of the warrants issued in the January 2023 Offering were determined to be equity-classified. As of March 31, 2023, all of the pre-funded warrants issued with the January 2023 Offering have been exercised for shares of the Company's common stock. The following table summarizes warrant acti vity during the three months ended March 31, 2023: Number of Weighted Weighted Warrants outstanding, December 31, 2022 1,055,672 $ 26.48 3.32 Granted 1,691,578 1.59 4.76 Exercised ( 1,142,829 ) 1.18 1.40 Forfeited, expired or cancelled — — — Warrants outstanding, March 31, 2023 1,604,421 18.26 4.41 |
Note 5 - Fair Value Measurement
Note 5 - Fair Value Measurements | 3 Months Ended |
Mar. 31, 2023 | |
Disclosure Text Block [Abstract] | |
Fair Value Measurements | 5. Fair Value Measurements The Company has issued warrants that are accounted for as liabilities based upon the guidance of ASC 815. Estimating fair values of liability-classified financial instruments requires the development of estimates that may, and are likely to, change over the duration of the instrument with related changes in internal and external market factors. In addition, option-based techniques are highly volatile and sensitive to changes in the trading market price of the Company’s common stock. Because liability-classified financial instruments are initially and subsequently carried at fair value, the Company’s financial results will reflect the volatility in these estimate and assumption changes. Changes in fair value are recognized as a component of other income in the condensed consolidated statement of operations. As of March 31, 2023, the fair value of the Senior Secured Promissory Note Warrants outstanding was determined using a Black-Scholes option pricing model valuation model to be insignificant due to the low market price of the Company's stock at the date of valuation relative to the exercise price of the Senior Secured Promissory Note Warrants outstanding. As of March 31, 2023, the fair value of the July 2021 Warrants outstanding was determined using a Monte Carlo simulation model to be insignificant due to the low market price of the Company's stock at the date of valuation relative to the exercise price of the Senior Secured Promissory Note Warrants outstanding. As of March 31, 2023 , the fair value of the January 2022 Warrants in the amount of $ 15,200 was determined using a Monte Carlo simulation model that used the following assumptions: (i) a starting stock price of $ 3.35 , (ii) certain key event dates such as expected capital financings, (iii) an exercise price per share of $ 55.00 , (iv) an expected re-levered volatility of 81.3 percent; (v) an estimated risk-free rate of 3.67 percent, (vi) estimated contractual terms of approximately 4.33 years, and (vii) a zero percent dividend rate. The following table summarizes the activity of the Company’s Level 3 warrant liabilities during the three months ended March 31, 2023 and 2022 (in thousands): Three Months Ended March 31, Warrant Liabilities 2023 2022 Fair value at beginning of period $ 61 $ 2,651 Initial fair value at the original issuance date — 1,110 Change in fair value during the period ( 43 ) ( 793 ) Fair value of liability classified warrants exercised — ( 1,274 ) Fair value at end of period $ 18 $ 1,694 The change in fair value of warrant liabilities during the three months ended March 31, 2023 and 2022 is included in Other income at the condensed consolidated statements of operations. Seneca had certain common stock purchase warrants that were originally issued in connection with the May 2016 and August 2017 offerings that are accounted for as liabilities whose fair value was determined using Level 3 inputs. The May 2016 warrants expired in the second quarter of 2021, with only the August 2017 warrants recorded as a liability as of March 31, 2023. As a result of the Merger, the put right was activated on the August 2017 offering warrants and these warrants were valued at their put right value using a Black-Scholes option pricing model. The Company settled the put feature for these warrants during the quarter ended June 30, 2021. The put right became inactive in July 2021 and the remaining warrants had an insignificant value as of March 31, 2023 , which was determined using a Black-Scholes option pricing model. |
Note 6 - Stockholders' Equity (
Note 6 - Stockholders' Equity (Deficit) | 3 Months Ended |
Mar. 31, 2023 | |
Disclosure Text Block [Abstract] | |
Stockholders' Equity (Deficit) | 6. Stockholders’ Equity (Deficit) Classes of Stock Common Stock As of March 31, 2023 , the Company was authorized to issue 280,000,000 shares of $ 0.01 par value common stock. Each share of common stock entitles the holder thereof to one vote on each matter submitted to a vote at a meeting of stockholders. On November 15, 2022, the Company effected the Reverse Stock Split. Accordingly, each of the Company’s shareholders received one new share of the Company's common stock for every 50 shares of the Company's common stock such shareholder held immediately prior to the effective time of the Reverse Stock Split. The Reverse Stock Split affected all of the Company’s issued and outstanding shares of the Company's common stock equally. The Reverse Stock Split also affected the Company’s outstanding stock options, warrants and other exercisable or convertible securities and resulted in the shares underlying such instruments being reduced and the exercise price being increased proportionately to the Reverse Stock Split ratio. No fractional shares were issued as a result of the Reverse Stock Split with any fractional shares that would have otherwise resulted from the Reverse Stock Split paid in cash, at an amount equal to the resulting fractional interest in one share of the Company's common stock to which the shareholder would otherwise be entitled, multiplied by the closing trading price of the Company's common stock on November 15, 2022. The amount of cash paid for fractional shares was insignificant . As a result of the Reverse Stock Split, the number of issued and outstanding shares of the Company's common stock was adjusted from 77,080,169 shares to approximately 1,541,508 shares. Each share of the Company's common stock entitles the holder thereof to one vote on each matter submitted to a vote at a meeting of stockholders. Preferred Stock As of March 31, 2023 , the Company was authorized to issue 7,000,000 shares of $ 0.01 par value preferred stock of which 1,000,000 shares have been designated as Series A 4.5% Convertible Preferred Stock ("Series A Convertible Preferred Stock") and 200,000 of which are issued and outstanding. As of March 31, 2023 , the Company's Series A Convertible Preferred Stock issued in the amount of 200,000 preferred stock shares is convertible into 129 shares of common stock. January 2023 Registered Direct Offering and Private Placement On January 4, 2023, the Company announced that it had closed on a previously announced agreement with certain institutional and accredited investors pursuant to which it agreed to sell and issue, in a registered direct offering (the “January 2023 Registered Offering”), an aggregate of (i) 476,842 shares of the Company's common stock, par value $ 0.01 per share, at a purchase price per share of $ 2.375 , and (ii) 37,000 pre-funded warrants to purchase shares of the Company's common stock at a purchase price of $ 2.3749 , with such warrants having an exercise price of $ 0.0001 per share and a perpetual term. Additionally, in a concurrent private placement, the Company also agreed to sell and issue to such purchasers, an aggregate of (i) 538,789 pre-funded warrants to purchase shares of the Company's common stock at a purchase price of $ 2.3749 , with such warrants having an exercise price of $ 0.0001 per share and a perpetual term; and (ii) 1,052,631 warrants to purchase shares of the Company's common stock at an exercise price of $ 2.375 per share and a term of five years (collectively, the “January 2023 Offering”). All the warrants are immediately exercisable from their date of issuance. Pursuant to a placement agency agreement dated as of December 30, 2022, the Company engaged Ladenburg Thalmann & Co. Inc. (the “January 2023 Placement Agent”), to act as the exclusive placement agent in connection with the January 2023 Registered Offering and concurrent private placement transaction. The Company issued warrants to the January 2023 Placement Agent to purchase an aggregate of 63,158 shares of the Company's common stock (the "January 2023 Placement Agent Warrants"). The January 2023 Placement Agent Warrants have an exercise price of $ 2.9688 per share and a term of five years . The January 2023 Placement Agent Warrants are immediately exercisable from issuance. The fair value of the January 2023 Placement Agent Warrants was recognized by the Company as an equity issuance cost which reduced the additional paid-in capital recognized from the January 2023 Offering. Gross cash proceeds from the January 2023 Offering were $ 2.5 million and net cash proceeds were approximately $ 2.2 million after deducting equity issuance costs of approximately $ 0.3 million, which excludes the grant date fair value of the January 2023 Placement Agent Warrants of approximately $ 0.2 million. |
Note 7 - Equity Incentive Plans
Note 7 - Equity Incentive Plans | 3 Months Ended |
Mar. 31, 2023 | |
Disclosure Text Block [Abstract] | |
Equity Incentive Plans | 7. Equity Incentive Plans In 2013, LBS adopted the 2013 Employee, Director, and Consultant Equity Incentive Plan, (as amended and restated, the “2013 Plan”). Upon the closing of the Merger, each outstanding, unexercised and unexpired LBS option under the 2013 Plan, whether vested or unvested, was assumed by the Company and converted into an option to purchase common stock of the Company and became exercisable by the holder of such option in accordance with its terms. In connection with the closing of the Merger, no further awards will be made under the 2013 Plan. In April 2021, in connection with the closing of the Merger, the Company’s stockholders approved the Palisade Bio, Inc. 2021 Equity Incentive Plan (the “2021 EIP Plan”). As of March 31, 2023 , there were 70,672 shares of the Company's common stock authorized and available for issuance as equity-based awards under the 2021 EIP Plan. Also in April 2021, the Company's stockholders approved the Palisade Bio, Inc. 2021 Employee Stock Purchase Plan (the "2021 ESPP"). The 2021 ESPP was adopted in order to provide eligible employees of the Company an opportunity to purchase shares of the Company's common stock. As of March 31, 2023 , there were 34,603 shares of the Company's common stock authorized and available under the ESPP and there have been no shares issued under the ESPP. In November 2021, the Company's compensation committee of the Board adopted the Palisade Bio, Inc. 2021 Inducement Award Plan (the "2021 Inducement Plan"). The 2021 Inducement Plan was adopted in order to grant equity-based awards to individuals not previously employed by the Company, as an inducement to join the Company. As of March 31, 2023 , there were 6,574 shares of the Company's common stock authorized and available for issuance as equity-based awards under the 2021 Inducement Plan. Stock Options The Company believes that stock options align the interests of its employees and directors with the interests of its stockholders. Stock option awards are generally granted with an exercise price equal to the market price of Company’s stock at the date the grants are awarded, a term as determined by the Company's Board but generally not to exceed ten-years, and generally vest in equal proportions each quarter over three years. The Company's equity incentive plans allow for the issuance of both incentive stock options and non-statutory stock options. The fair value of options granted in the three months ended March 31, 2023 and March 31, 2022 is estimated as of the grant date using the Black-Scholes option pricing model using the assumptions in the following table: Three Months Ended March 31, 2023 2022 Weighted-average exercise price per share $ 2.36 $ 48.67 Weighted-average expected term (years) 5.81 5.81 Weighted-average risk-free interest rate 3.76 % 1.85 % Weighted-average expected dividend yield — — Weighted-average volatility 69.54 % 73.77 % Risk-free interest rate. The Company bases the risk-free interest rate assumption on observed interest rates appropriate for the expected term of the stock option grants. Expected dividend yield. The Company bases the expected dividend yield assumption on the fact that it has never paid cash dividends and has no present intention to pay cash dividends. Expected volatility. Due to the Company’s limited operating history and lack of company-specific historical or implied volatility, the expected volatility assumption is based on historical volatilities of a peer group of similar companies whose share prices are publicly available. The peer group was developed based on companies in the biotechnology industry. Expected term. The expected term represents the period of time that options are expected to be outstanding. As the Company does not have sufficient historical exercise behavior, it determines the expected life assumption using the simplified method, which is an average of the contractual term of the option and its vesting period. The following table summarizes stock option activity and related information under the 2013 Plan, the 2021 EIP Plan and the 2021 Inducement Plan for the three months ended March 31, 2023 : Number of Weighted Weighted Aggregate Outstanding at December 31, 2022 43,658 $ 311.74 6.08 $ — Granted 30,620 2.36 9.88 — Exercised — — — — Forfeited, expired or cancelled ( 10,489 ) 242.03 — — Outstanding at March 31, 2023 63,789 174.70 8.70 35,644 Vested and expected to vest at March 31, 2023 63,789 174.70 8.70 35,644 Exercisable at March 31, 2023 22,383 463.61 6.97 — The weighted-average grant-date fair value of options granted during the three months ended March 31, 2023 was $1 .51 per share. The fair value of the options vested during the three months ended March 31, 2023 was approximately $ 0.1 million. On February 6, 2023, the Company conditionally granted to certain members of management a total of 81,500 stock options that are conditional subject to shareholder approval at the Company's annual shareholder meeting to be held on June 8, 2023. Accordingly, the Company has no t recognized any share-based compensation expense related to the conditional stock options as of March 31, 2023. The Company will begin to recognize share-based compensation expense related to the conditional stock options if and when shareholder approval is received. Restricted Stock Units During the three months ended March 31, 2023, the Company granted under the 2021 EIP Plan time-based restricted stock units ("RSUs") to employees. The RSUs generally vest proportionally each quarter over a term of one or three years. The following table summarizes RSU activity and related information under the 2021 EIP Plan for the three months ended March 31, 2023: Number of Weighted Weighted Non-vested at December 31, 2022 — $ — — Granted 44,632 3.25 — Vested — — — Forfeited ( 2,479 ) 3.15 — Non-vested at March 31, 2023 42,153 3.26 1.47 No ne of the RSUs granted the during three months ended March 31, 2023 vested during the three months ended March 31, 2023. On February 6, 2023, the Company conditionally granted to certain members of management a total of 59,500 restricted stock units that are conditional and subject to shareholder approval at the Company's annual shareholder meeting to be held on June 8, 2023. Accordingly, the Company has no t recognized any share-based compensation expense related to the conditional restricted stock units as of March 31, 2023. The Company will begin to recognize share-based compensation expense related to the conditional RSUs if and when shareholder approval is received. Performance Based Stock Units On February 6, 2023, the Company conditionally granted to certain members of management a total of 68,700 performance-based stock units ("PSUs") which vest (a) 50 % when the volume weighted average price of the Company’s common stock over 20 consecutive trading days is $ 3.20 or greater, and (b) 50 % when such volume weighted average price of the Company’s common stock over 20 consecutive trading days is $ 4.25 or greater. The PSUs are conditional subject to shareholder approval at the Company's annual shareholder meeting to be held on June 8, 2023. Accordingly, the Company has no t recognized any share-based compensation expense related to the conditional PSUs as of March 31, 2023. The Company will begin to recognize share-based compensation expense related to the conditional PSUs if and when shareholder approval is received. Share-Based Compensation Expense The allocation of stock-based compensation for all stock awards is as follows (in thousands): Three Months Ended March 31, 2023 2022 Research and development expense $ 49 $ 52 General and administrative expense 44 306 Total $ 93 $ 358 As of March 31, 2023 , the unrecognized compensation cost related to outstanding options was $ 0.5 million, which is expected to be recognized over a weighted-average period of approximately 1.84 years and the unrecognized compensation cost related to outstanding RSUs was $ 0.1 million which is expected to be recognized over a weighted average period of approximately 1.47 years. |
Note 8 - Collaborations and Lic
Note 8 - Collaborations and License Agreements | 3 Months Ended |
Mar. 31, 2023 | |
Disclosure Text Block [Abstract] | |
Collaborations and License Agreements | 8. Collaborations and License Agreements Co-Development and Distribution Agreement with Newsoara LBS has entered into a co-development and distribution agreement with Newsoara, a joint venture established with Biolead Medical Technology Limited, as amended, (the “Co-Development Agreement”). Pursuant to the Co-Development Agreement (and subsequent assignment agreement), LBS granted or licensed Newsoara an exclusive right under certain patents to develop, use, sell, offer to sell, import, and otherwise commercialize licensed products (the “Licensed Products”) for any and all indications in the People’s Republic of China, including the regions of Hong Kong and Macao, but excluding Taiwan (the “Territory”). The Licensed Products only include the Company's lead drug candidate, LB1148. The right includes the right to grant sublicenses to third parties, subject to LBS’ written consent, provided that both parties agreed that Newsoara would be permitted to use a certain partner for development purposes. The Co-Development Agreement obligates Newsoara to initially use LBS as the exclusive supplier for all of Newsoara’s requirements for Licensed Products in the Territory. During the term of the Co-Development Agreement, Newsoara may request to manufacture the Licensed Product in the Territory, subject to satisfying certain conditions to LBS' reasonable satisfaction. LBS is obligated to approve Newsoara manufacturing rights without undue refusal or delay. In consideration of the rights granted to Newsoara under the Co-Development Agreement, Newsoara paid LBS a one-time upfront fee of $ 1.0 million. In addition, Newsoara is obligated to make (i) payments up to $ 6.75 million in the aggregate upon achievement of certain regulatory and commercial milestones, (ii) payments in the low six-digit range per licensed product upon achievement of a development milestone, and (iii) tiered royalty payments ranging from the mid-single-digit to low-double-digit percentage range on annual net sales of Licensed Products, subject to adjustment to the royalty percentage in certain events, including a change of control, the expiration of certain patents rights, and royalties paid by Newsoara third parties. To date, Newsoara has met all of its payment obligations under the Co-Development Agreement. During the three months ended March 31, 2023 , the Company recognized license revenue of $ 0.3 million earned upon Newsoara's achievement of a development milestone under the Co-Development Agreement during the period. Related to this, the Company has recognized $ 0.3 million in accounts receivable as of March 31, 2023, to which the Company has not recorded an allowance for estimated credit losses based on its relationship with Newsoara and Newsoara's history of timely payment of balances owed. In early May 2023, prior to the issuance of these condensed consolidated financial statements, Newsoara has paid the entire balance of the accounts receivable outstanding as of March 31, 2023. During the three months ended March 31, 2022 , there were no milestone payments earned from Newsoara under the Co-Development Agreement. The Co-Development Agreement will expire upon the later of the expiration date of the last valid claim of any licensed patent covering the Licensed Products in the Territory. In addition, the Co-Development Agreement can be terminated (i) by either party for the other party’s material breach that remains uncured for a specified time period after written notice or for events related to the other party’s insolvency, (ii) by LBS if Newsoara challenges or attempts to interfere with any licensed patent rights and, (iii) by Newsoara for any reason upon specified prior written notice. License Agreements with the Regents of the University of California The Company has entered into three license agreements, as amended, with the Regents of the University of California (“Regents”) for exclusive commercial rights to certain patents, technology and know-how. The licensed assets are related to the Company’s products and assays under development. The Regents are entitled to certain development and sales milestones. In conjunction with the Co-Development Agreement with Newsoara, the Company is obligated to pay the Regents a portion of the sublicense revenue ranging from 30 percent to 35 percent of one-third of the upfront payment and milestone payments received. As of March 31, 2023 and December 31, 2022 sublicensing payables of approxi mately $ 36,000 and $ 13,000 respectively, were included in accounts payable. |
Note 9 - Commitments and Contin
Note 9 - Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 9. Commitments and Contingencies Corporate Office Lease On May 12, 2022, the Company entered into a new, non-cancelable facility operating lease (the "Corporate Office Lease") of office space for its corporate headquarters, replacing its existing corporate headquarters lease that expired on July 31, 2022. The Corporate Office Lease is for 2,747 square feet of an office building in Carlsbad, California. The initial contractual term is for 39-months commencing on June 1, 2022 and expiring on August 31, 2025. The Company has the option to renew the Corporate Office Lease for an additional 36-month period at the prevailing market rent upon completion of the initial lease term. The Company has determined it is not reasonably certain that it will exercise this renewal option. Commencing on June 1, 2022, the Company is subject to contractual monthly lease payments of $ 10,850 , plus certain utilities, for the first 12 months with 3 percent escalations at the first, second and third lease commencement anniversaries. The Corporate Office Lease is s ubject to conditional abatement of fifty percent ( 50 %) of such base rent during the second, third and fourth full calendar months of the initial lease term, as set forth in the lease agreement, as well as a $ 28,000 tenant improvement allowance. The Corporate Office Lease is also subject to additional variable charges for common area maintenance, insurance, taxes and other operating costs. This additional variable rent expense is not estimable at lease inception. Therefore, it is excluded from the Company’s straight-line expense calculation at lease inception and is expensed as incurred. As of March 31, 2023 , the Company recognized an operating right-of-use asset related to the Corporate Office Lease in the amount of $ 275,000 and a current and noncurrent operating lease liability related to the Corporate Office Lease of $ 109,000 and $ 182,000 , respectively. As of March 31, 2023 , the total remaining future minimum lease payments associated with the Corporate Office Lease of approximately $ 291,000 , less imputed interest of $ 38,000 calculated using a discount rate of 10.75 % , will be paid over the remaining lease term of approximately 2.4 years. Maturities of the Company's operating lease liabilities as of March 31, 2023 are as follows: Year ending December 31, 2023 (remaining) $ 100 2024 136 2025 93 Total operating lease payments 329 Less: imputed interest ( 38 ) Total operating lease obligations $ 291 The Company recognized operating lease expense associated with its Corporate Office Lease and its predecessor corporate headquarters lease of approximately $ 32,000 and $ 49,000 in the three months ended March 31, 2023 and March 31, 2022, respectively. Insurance Financing Arrangements Consistent with past practice, on May 9, 2022 and May 24, 2022, the Company entered into agreements to finance certain insurance policies which renewed in April 2022 and May 2022. The financing arrangements entered into on May 9, 2022 and May 24, 2022 have stated interest rate of 3.82 % and 6.92 %, respectively, and are payable over a 9-month period and 10-month period, respectively, with the first payment commencing May 27, 2022. The insurance financing arrangements are secured by the associated insurance policies. As of March 31, 2023 and December 31, 2022 , the aggregate remaining balance under the Company's insurance financing arrangements was zero and $ 0.1 million, respectively. Restructuring Costs In order to better utilize the Company’s resources on the implementation of its refocused clinical programs and corporate strategy, on September 9, 2022 the Company committed to a cost-reduction plan. This cost-reduction plan consisted of a reduction of approximately 20 % in workforce to better align the Company’s resources on its clinical studies, including its lead asset, LB1148. As of March 31, 2023 and December 31, 2022, the Company recognized accrued liabilities on its condensed consolidated balance sheets in the amount of approximately $ 5,000 and $ 180,000 , respectively, related to severance and benefits owed pursuant to employment agreements and the execution of severance and release agreements associated with the restructuring. The Company made cash payments of approximately $ 175,000 in the three months ended March 31, 2023 related to the employee severance and benefits and expects to make remaining cash payments of $ 5,000 in the three months ending June 30, 2023. The Company recognized no restructuring expense related to the cost-reduction plan in the three months ended March 31, 2023 and 2022. Legal Proceedings From time to time, the Company may be involved in various lawsuits, legal proceedings, or claims that arise in the ordinary course of business. Management believes there are no claims or actions pending against the Company through March 31, 2023 , which will have, individually or in aggregate, a material adverse effect on its business, liquidity, financial position, or results of operations. Litigation, however, is subject to inherent uncertainties, and an adverse result in such matters may arise from time to time that may harm the Company’s business. Indemnification In accordance with the Company’s amended and restated memorandum and articles of association, the Company has indemnification obligations to its officers and directors for certain events or occurrences, subject to certain limits, while they are serving in such capacity. There have been no claims to date, and the Company has a directors and officers liability insurance policy that may enable it to recover a portion of any amounts paid for future claims. |
Note 10 - Related Party Transac
Note 10 - Related Party Transactions | 3 Months Ended |
Mar. 31, 2023 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 10. Related Party Transactions Yuma Regional Medical Center On August 19, 2021, the Company issued to Yuma Regional Medical Center ("Yuma"), a related party, a warrant to purchase up to 7,549 shares of the Company's common stock at a price of $ 172.50 per share, subject to certain adjustments (the "August 2021 Warrants"), all of which are outstanding as of March 31, 2023 . The August 2021 Warrants, which have been registered for resale, are immediately exercisable and have an expiration date of August 26, 2026 . Director stipends Unpaid cash stipends owed to the Company's directors for their annual board service are recorded on the Company’s condensed consolidated balance sheets within accrued liabilities. These liabilities were $ 107,500 and $ 141,250 as of March 31, 2023 , and December 31, 2022 , respectively. Separation agreement with former Chief Executive Officer On October 11, 2022, the Company entered into a separation agreement with its former Chief Executive Officer whereby the parties agreed to a mutual release of claims. Subsequent to paying an aggregate of $ 22,000 pursuant to the terms of the separation agreement, the Company determined that it is not probable that any additional compensation would be due to the former Chief Executive Officer and therefore, the Company has not recognized any accrual related to compensation or benefits owed pursuant to the separation agreement as of March 31, 2023 . |
Note 11 - Subsequent Events
Note 11 - Subsequent Events | 3 Months Ended |
Mar. 31, 2023 | |
Disclosure Text Block [Abstract] | |
Subsequent Events | 11. Subsequent Events April 2023 Offering On April 3, 2023, the Company entered into securities purchase agreements (the “Securities Purchase Agreement”) with certain institutional and accredited investors pursuant to which the Company agreed to sell and issue, in a registered direct offering (the “April 2023 Registered Offering”), an aggregate of 756,317 shares of the Company's common stock, at a purchase price per share of $ 2.64 . Additionally, in a concurrent private placement, the Company also agreed to sell and issue to such purchasers, an aggregate of (i) 455,242 unregistered shares of the Company's common stock, at a purchase price per share of $ 2.64 , (ii) 1,061,164 prefunded warrants to purchase shares of the Company's common stock at a purchase price of 2.6399 , with such warrants having an exercise price of $ 0.0001 per share and a perpetual term; and (iii) 2,272,723 common stock warrants to purchase shares of the Company's common stock at an exercise price of $ 2.64 per share and a term of five years from the date of issuance (the “Private Offering”) (collectively, April 2023 Registered Offering and Private Offering are referred to as the “April 2023 Offering”). All of the warrants issued in the Private Offering are immediately exercisable from their date of issuance. Pursuant to a placement agency agreement dated as of April 3, 2023, the Company engaged Ladenburg Thalmann & Co. Inc. (the “April 2023 Placement Agent”) , to act as the exclusive placement agent in connection with the April 2023 Offering. The Company issued warrants to the April 2023 Placement Agent to purchase an aggregate of 136,363 shares of the Company's common stock (the "April 2023 Offering Placement Agent Warrants"). The April 2023 Offering Placement Agent Warrants have an exercise price of $ 3.30 per share and a term of five years and are immediately exercisable from issuance. Gross cash proceeds from the April 2023 Offering were $ 6.0 million and net cash proceeds are approximately $ 5.4 million after deducting cash equity issuance costs of approximately $ 0.6 million. |
Note 2 - Summary of Significa_2
Note 2 - Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Consolidation | Basis of Presentation and Consolidation In management’s opinion, the accompanying interim condensed consolidated financial statements include all adjustments, consisting of normal recurring adjustments, which are necessary to present fairly the Company's financial position, results of operations and cash flows. The interim results of operations are not necessarily indicative of the results that may occur for the full year. Certain information and note disclosures normally included in the consolidated financial statements prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) have been condensed or omitted pursuant to instructions, rules and regulations prescribed by the U.S. Securities and Exchange Commission (“SEC”). The Company believes that the disclosures provided herein are adequate to make the information presented not misleading when these condensed consolidated financial statements are read in conjunction with the condensed consolidated financial statements and notes included in the Company’s financial statements filed on the Annual Report on Form 10-K for the year ended December 31, 2022, which was filed with the SEC on March 22, 2023. Certain prior period amounts in the condensed consolidated financial statements and accompanying notes have been reclassified to conform to the current period’s presentation. The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, Leading Biosciences, Inc. and Suzhou Neuralstem Biopharmaceutical Co., Ltd. All the entities are consolidated in the Company's condensed consolidated financial statements and all intercompany activity and transactions, if any, have been eliminated . |
Reverse Stock Split | Reverse Stock Split On November 15, 2022, the Company effected a 1-for-50 reverse stock split of its issued and outstanding common stock (the "Reverse Stock Split"). As a result of the Reverse Stock Split, each of the Company’s shareholders received one new share of common stock for every 50 shares such shareholder held immediately prior to the effective time of the Reverse Stock Split. The Reverse Stock Split affected all the Company’s issued and outstanding shares of common stock equally. The par value and authorized shares of the Company's common stock was not adjusted as a result of the Reverse Stock Split. The Reverse Split also affected the Company’s outstanding stock options, common stock warrants and other exercisable or convertible securities and resulted in the shares underlying such instruments being reduced and the exercise price being increased proportionately. Unless otherwise noted, all common stock shares, common stock per share data and shares of common stock underlying convertible preferred stock, stock options and common stock warrants included in these condensed consolidated financial statements, including the exercise price of such equity instruments, as applicable, have been retrospectively adjusted to reflect the effect of the Reverse Stock Split for all periods presented. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires the Company to make estimates, judgments, and assumptions that impact the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the balance sheet, and the reported amounts of expenses during the reporting period. The most significant estimates in the Company’s condensed consolidated financial statements relate to clinical trial accruals and its derivative financial instruments. Although these estimates are based on the Company’s knowledge of current events and actions it may undertake in the future, actual results may materially differ from these estimates and assumptions. |
Segment Information | Segment Information Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision maker, the Chief Executive Officer, in making decisions regarding resource allocation and assessing performance. The Company views its operations and manages its business as one operating segment, which consists of research and development activities. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents represent cash available in readily available checking and money market accounts. The Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. |
Restricted Cash | Restricted Cash As of March 31, 2023 and December 31, 2022, the Company held restricted cash of $ 26,000 , in a separate restricted bank account as collateral for the Company’s corporate credit card program. The Company has classified these deposits as long-term restricted cash on its condensed consolidated balance sheets . |
Deferred Equity Issuance Costs | Deferred Equity Issuance Costs Deferred equity issuance costs consist of the legal, accounting and other direct and incremental costs incurred by the Company related to its equity offerings (See Note 11, Subsequent Events) or shelf registration statement. As of March 31, 2023 and December 31, 2022, deferred equity issuance costs of $ 93,000 and $ 114,000 , respectively, w ere included in prepaid and other assets in the condensed consolidated balance sheet. These costs will be netted against additional paid-in capital as a cost of the future equity issuances to which they relate. |
Concentration of Credit Risk | Concentration of Credit Risk Financial instruments, which potentially subject the Company to concentration of credit risk, consist primarily of cash and cash equivalents and accounts receivable. The Company maintains deposits in federally insured financial institutions and in money market accounts, and at times balances may exceed 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 nor has the Company experienced any losses in these accounts. The Company's entire accounts receivable balance as of March 31, 2023 is with the Company co-development partner, Newsoara Biopharma Co., Ltd. (“Newsoara”) (See Note 8, Collaborations and License Agreements). Management believes it is not exposed to significant credit risk on the accounts receivable based on its relationship with Newsoara and Newsoara's history of timely payment of balances owed. In early May 2023, prior to the issuance of these condensed consolidated financial statements, Newsoara has paid the entire balance of the accounts receivable outstanding as of March 31, 2023 . |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company’s financial instruments consist principally of cash and cash equivalents, restricted cash, accounts receivable, other current receivables, accounts payable, accrued liabilities, debt, and liability-classified warrants. The carrying amounts of financial instruments such as cash equivalents, restricted cash, accounts receivable, other current receivables, accounts payable, and accrued liabilities approximate their related fair values due to the short-term nature of these instruments. The carrying value of the Company’s debt as of December 31, 2022 approximates its fair value due to the market rate of interest, which is based on level 2 inputs. The Company’s derivative financial instruments are carried at fair value based on level 3 inputs as defined below. None of the Company’s non-financial assets or liabilities are recorded at fair value on a nonrecurring basis. The Company follows Accounting Standards Codification ("ASC") 820, Fair Value Measurements and Disclosures , which among other things, defines fair value, establishes a consistent framework for measuring fair value and expands disclosure for each major asset and liability category measured at fair value on either a recurring or nonrecurring basis. Fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, a three-tier fair value hierarchy has been established, which prioritizes the inputs used in measuring fair value as follows: (1) Level 1: observable inputs such as quoted prices (unadjusted) in active markets for identical assets or liabilities; (2) Level 2: inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and (3) Level 3: unobservable inputs for which there is little or no market data, which require the reporting entity to develop its own assumptions, which reflect those that a market participant would use. Further information on the fair value of financial instruments can be found at Note 5, Fair Value Measurements. |
Derivative Financial Instruments | Derivative Financial Instruments The Company does not use derivative instruments to hedge exposures to cash flow, market, or foreign currency risks. The Company evaluates its financial instruments, including warrants, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. The Company values its derivatives using the Black-Scholes option pricing model or other acceptable valuation models, including the Monte-Carlo simulation model. Derivative instruments are valued at inception, upon events such as an exercise of the underlying financial instrument, and at subsequent reporting periods. The classification of derivative instruments, including whether such instruments should be recorded as liabilities, is reassessed at the end of each reporting period. The Company reviews the terms of debt instruments, equity instruments, and other financing arrangements to determine whether there are embedded derivative features, including embedded conversion options that are required to be bifurcated and accounted for separately as a derivative financial instrument. Additionally, in connection with the issuance of financing instruments, the Company may issue freestanding options and warrants. The Company accounts for its common stock warrants in accordance with ASC 480, Distinguishing Liabilities from Equity ("ASC 480") and ASC 815, Derivatives and Hedging (“ASC 815”). Based upon the provisions of ASC 480 and ASC 815, the Company accounts for common stock warrants as liabilities if the warrant requires net cash settlement or gives the holder the option of net cash settlement, or it fails the equity classification criteria. The Company accounts for common stock warrants as equity if the contract requires physical settlement or net physical settlement or if the Company has the option of physical settlement or net physical settlement and the warrants meet the requirements to be classified as equity. Common stock warrants classified as liabilities are initially recorded at fair value on the grant date and remeasured at fair value at each balance sheet date with the offsetting adjustments recorded in change in fair value of warrant liability within the condensed consolidated statements of operations. If the terms of a common stock warrant previously classified as a liability are amended and pursuant to such amendment meet the requirements to be classified as equity, the common stock warrants are reclassified to equity at the fair value on the date of the amendment and are not subsequently remeasured. Common stock warrants classified as equity are recorded on a relative fair value basis when they are issued with other equity-classified financial instruments . |
Leases | Leases In accordance with ASC 842, Leases , the Company assesses contracts for lease arrangements at inception. Operating right-of-use (“ROU”) assets and liabilities are recognized at the lease commencement date equal to the present value of future lease payments using the implicit, if readily available, or incremental borrowing rate based on the information readily available at the commencement date. ROU assets include any lease payments as of commencement and initial direct costs but exclude any lease incentives. Lease and non-lease components are generally accounted for separately and the Company recognizes operating lease expense straight-line over the term of the lease. |
Milestone Revenue | Milestone Revenue The Company uses the revenue recognition guidance established by ASC 606, Revenue From Contracts With Customers (“ASC 606”). When an agreement falls under the scope of other standards, such as ASC 808, Collaborative Arrangements , the Company will apply the recognition, measurement, presentation, and disclosure guidance in ASC 606 to the performance obligations in the agreements if those performance obligations are with a customer. The Company currently does not have any collaborative arrangements with counterparties that are also considered customers. For arrangements that include amounts to be paid to the Company upon the achievement of certain development milestones of technology licensed by the Company, the Company recognizes such license revenue using the most likely method. At the end of each reporting period, the Company re-evaluates the probability or achievement of any potential milestones and any related constraints, and if necessary, adjusts its estimates of the overall transaction price. Any such adjustments are recorded on a cumulative catch-up basis, which would affect revenue in the period of adjustment. For the three months ended March 31, 2023 , $ 0.3 million of license revenue related to milestones achieved on licensed technology was recognized as revenue and was reported in accounts receivable as of March 31, 2023, to which the Company has not recorded an allowance for estimated credit losses based on its relationship with the counterparty and the counterparty's history of timely payment of balances owed to the Company (see Note 8, Collaborations and License Agreements). |
Research and Development Costs | Research and Development Costs Research and development expenses consist primarily of salaries and other personnel related expenses including stock-based compensation costs, preclinical costs, clinical trial costs, costs related to acquiring and manufacturing clinical trial materials, and contract services. All research and development costs are expensed as incurred . |
Clinical Trial Expenses | Clinical Trial Expenses Expenses related to clinical studies are based on estimates of the services received and efforts expended pursuant to the Company’s contract arrangements. The financial terms of these agreements are subject to negotiation, vary from contract to contract, and may result in uneven payment flows. There may be instances in which payments made to the Company’s service providers will temporarily exceed the level of services provided and result in a prepayment of the clinical expense. Payments under some of these contracts depend on factors such as the successful enrollment of patients, site initiation and the completion of clinical milestones. The Company makes estimates of its accrued expenses as of each balance sheet date in its condensed consolidated financial statements based on facts and circumstances known at that time. In accruing service fees, the Company estimates the time period over which services will be performed and the level of effort to be expended in each period. If the actual timing of the performance of services or the level of effort varies from its estimate, the Company adjusts the accrual or prepaid expense balance accordingly. As of March 31, 2023 and December 31, 2022, the Company has accrued $ 94,000 and $ 184,000 , respectively, in clinical trial expenses for which services have been provided but the Company has not yet been invoiced as of the balance sheet date. Clinical trial expenses are recognized in research and development expenses in the condensed consolidated statements of operations in the period incurred . |
Patent Costs | Patent Costs Costs related to filing and pursuing patent applications (including direct application fees, and the legal and consulting expenses related to making such applications) are expensed as incurred, as recoverability of such expenditures is uncertain. These costs are included in general and administrative expenses in the condensed consolidated statements of operations . |
Income Taxes | Income Taxes The Company follows ASC 740, Income Taxes , or ASC Topic 740 (“ASC 740”), in reporting deferred income taxes. ASC 740 requires a company to recognize deferred tax assets and liabilities for expected future income tax consequences of events that have been recognized in the Company’s condensed consolidated financial statements. Under this method, deferred tax assets and liabilities are determined based on temporary differences between financial statement carrying amounts and the tax basis of assets and liabilities using enacted tax rates in the years in which the temporary differences are expected to reverse. Valuation allowances are provided if, based on the weight of available evidence, it is more likely than not that some of or all the deferred tax assets will not be realized. The Company accounts for uncertain tax positions pursuant to ASC 740, which prescribes a recognition threshold and measurement process for financial statement recognition of uncertain tax positions taken or expected to be taken in a tax return. If the tax position meets this threshold, the benefit to be recognized is measured as the tax benefit having the highest likelihood of being realized upon ultimate settlement with the taxing authority. The Company recognizes interest accrued related to unrecognized tax benefits and penalties in the provision for income taxes. |
Stock-Based Compensation | Stock-Based Compensation The Company’s stock-based compensation expense generally includes time-based restricted stock units (“RSUs”) stock options, as well as performance-based RSUs (“PSUs”). The Company accounts for forfeitures as they occur for each type of award as a reduction of expense. Stock-based compensation expense related to time-based RSUs is based on the market value of the underlying stock on the date of grant and the related expense is recognized ratably over the requisite service period, which is usually the vesting period. The Company estimates the fair value of employee and non-employee stock option grants using the Black-Scholes option pricing model. The determination of the fair value of stock-based payment awards on the date of grant using the Black-Scholes option pricing model is affected by the Company's stock price as well as assumptions, which include the expected term of the award, the expected stock price volatility, risk-free interest rate, and expected dividends over the expected term of the award. Stock-based compensation expense represents the cost of the estimated grant date fair value of employee and non-employee stock option grants recognized ratably over the requisite service period of the awards, which is usually the vesting period. For PSUs with vesting subject to market conditions, the fair value of the award is determined at grant date using the Monte Carlo simulation model, and expense is recognized ratably over the requisite service period regardless of whether or not the market condition is satisfied. The Monte Carlo simulation model considers a variety of potential future scenarios under the market condition vesting criteria, including but not limited to share prices for the Company and its peer companies in a selected market index. The Company does not recognize any share-based compensation expense related to conditional RSUs, stock options, or PSUs that are subject to shareholder approval. When and if approval is obtained, the Company recognizes share-based compensation expense related to the conditional equity grants ratably to the vesting of shares over the remaining requisite service period. |
Net Loss Per Common Share | Net Loss Per Common Share Basic loss per common share is computed by dividing net loss available to common stockholders by the weighted average number of shares of common stock outstanding during the period. The Company's Series A Convertible Preferred Stock and certain of the Company's outstanding warrants contain non-forfeitable rights to dividends with the common stockholders, and therefore are considered to be participating securities. The Series A Convertible Preferred Stock and the warrants do not have a contractual obligation to fund the losses of the Company; therefore, the application of the two-class method is not required when the Company is in a net loss position but is required if the Company is in a net income position. When in a net income position, diluted earnings per share is computed using the more dilutive of the two-class method or the if-converted and treasury stock methods. As the Company was in a loss position for both periods, basic and diluted loss per common share for the three months ended March 31, 2023 and March 31, 2022 were calculated under the if-converted and treasury stock methods. For the three months ended March 31, 2023 and March 31, 2022, basic and diluted loss per common share were the same as all common stock equivalents were anti-dilutive for both periods. The following table presents the calculation of weighted average shares used to calculate basic and diluted loss per share (in thousands, except share and per share amounts): Three Months Ended March 31, 2023 2022 Basic net loss per common share: Net loss $ ( 2,340 ) $ ( 4,205 ) Weighted average shares used in calculating basic loss per common share 4,315,526 324,473 Basic net loss per common share $ ( 0.54 ) $ ( 12.96 ) Diluted net loss per common share: Net loss $ ( 2,340 ) $ ( 4,205 ) Weighted average shares used in calculating diluted loss per common share 4,315,526 324,473 Diluted net loss per common share $ ( 0.54 ) $ ( 12.96 ) The following potentially dilutive securities were excluded from the calculation of diluted net loss per share because their effects would be anti-dilutive: March 31, 2023 2022 Stock options 63,789 30,965 Restricted stock units 42,153 — Warrants for common stock 1,604,421 106,921 Series A Convertible Preferred Stock 129 129 Total 1,710,492 138,015 |
Comprehensive Loss | Comprehensive Loss Comprehensive income (loss) is defined as a change in equity during a period from transactions and other events and circumstances from non-owner sources. The Company’s comprehensive loss was the same as its reported net loss for all periods presented. |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements In June 2016, the Financial Accounting Standards Board ("FASB") issued ASU No. 2016-13, Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”). The ASU introduced a new credit loss methodology, the Current Expected Credit Losses (“CECL”) methodology, which requires earlier recognition of credit losses, while also providing additional transparency about credit risk. The CECL methodology utilizes a lifetime “expected credit loss” measurement objective for the recognition of credit losses for loans, held-to maturity debt securities, trade receivables and other receivables measured at amortized cost at the time the financial asset is originated or acquired. After the issuance of ASU 2016-13, the FASB issued several additional ASUs to clarify implementation guidance, provide narrow-scope improvements and provide additional disclosure guidance. In November 2019, the FASB issued an amendment making this ASU effective for fiscal years beginning after December 15, 2022 for smaller reporting companies. The Company adopted this standard as of January 1, 2023 and determined it did not have a material impact on its condensed consolidated financial statements and related disclosures for the three months ended March 31, 2023 . |
Note 2 - Summary of Significa_3
Note 2 - Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Schedule of Weighted Average Number of Shares | The following table presents the calculation of weighted average shares used to calculate basic and diluted loss per share (in thousands, except share and per share amounts): Three Months Ended March 31, 2023 2022 Basic net loss per common share: Net loss $ ( 2,340 ) $ ( 4,205 ) Weighted average shares used in calculating basic loss per common share 4,315,526 324,473 Basic net loss per common share $ ( 0.54 ) $ ( 12.96 ) Diluted net loss per common share: Net loss $ ( 2,340 ) $ ( 4,205 ) Weighted average shares used in calculating diluted loss per common share 4,315,526 324,473 Diluted net loss per common share $ ( 0.54 ) $ ( 12.96 ) |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The following potentially dilutive securities were excluded from the calculation of diluted net loss per share because their effects would be anti-dilutive: March 31, 2023 2022 Stock options 63,789 30,965 Restricted stock units 42,153 — Warrants for common stock 1,604,421 106,921 Series A Convertible Preferred Stock 129 129 Total 1,710,492 138,015 |
Note 3 - Balance Sheet Details
Note 3 - Balance Sheet Details (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Table Text Block [Abstract] | |
Summary of Prepaid Expenses and Other Current Assets | Prepaid expenses and other current assets consisted of the following (in thousands): March 31, December 31, 2023 2022 Prepaid insurance $ 355 $ 581 Other receivables 78 1,438 Prepaid subscriptions and fees 193 157 Prepaid software licenses 37 54 Deferred equity issuance costs 93 114 Prepaid other 6 6 $ 762 $ 2,350 |
Schedule of Other Noncurrent Assets | Other noncurrent assets consisted of the following (in thousands): March 31, December 31, 2023 2022 Prepaid insurance, less current portion $ 631 $ 682 Other noncurrent assets 12 12 $ 643 $ 694 |
Schedule Of Accrued Liabilities | Accrued liabilities consisted of the following (in thousands): March 31, December 31, 2023 2022 Accrued accounts payable $ 73 $ 69 Accrued clinical trial costs 94 184 Accrued director stipends 108 141 Accrued severance and benefits (Note 9) 5 180 Accrued other 29 — $ 309 $ 574 |
Note 4 - Common Stock Warrants
Note 4 - Common Stock Warrants (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Table Text Block [Abstract] | |
Schedule of Stockholders' Equity Note, Warrants or Rights | The following table summarizes warrant acti vity during the three months ended March 31, 2023: Number of Weighted Weighted Warrants outstanding, December 31, 2022 1,055,672 $ 26.48 3.32 Granted 1,691,578 1.59 4.76 Exercised ( 1,142,829 ) 1.18 1.40 Forfeited, expired or cancelled — — — Warrants outstanding, March 31, 2023 1,604,421 18.26 4.41 |
Note 5 - Fair Value Measureme_2
Note 5 - Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Disclosure Text Block [Abstract] | |
Schedule of Fair Value of Options Granted | The following table summarizes the activity of the Company’s Level 3 warrant liabilities during the three months ended March 31, 2023 and 2022 (in thousands): Three Months Ended March 31, Warrant Liabilities 2023 2022 Fair value at beginning of period $ 61 $ 2,651 Initial fair value at the original issuance date — 1,110 Change in fair value during the period ( 43 ) ( 793 ) Fair value of liability classified warrants exercised — ( 1,274 ) Fair value at end of period $ 18 $ 1,694 |
Note 8 - Equity Incentive Plans
Note 8 - Equity Incentive Plans (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Table Text Block [Abstract] | |
Schedule of Fair Value of Options Granted | The fair value of options granted in the three months ended March 31, 2023 and March 31, 2022 is estimated as of the grant date using the Black-Scholes option pricing model using the assumptions in the following table: Three Months Ended March 31, 2023 2022 Weighted-average exercise price per share $ 2.36 $ 48.67 Weighted-average expected term (years) 5.81 5.81 Weighted-average risk-free interest rate 3.76 % 1.85 % Weighted-average expected dividend yield — — Weighted-average volatility 69.54 % 73.77 % |
Schedule of Summarized Stock Option Activity | The following table summarizes stock option activity and related information under the 2013 Plan, the 2021 EIP Plan and the 2021 Inducement Plan for the three months ended March 31, 2023 : Number of Weighted Weighted Aggregate Outstanding at December 31, 2022 43,658 $ 311.74 6.08 $ — Granted 30,620 2.36 9.88 — Exercised — — — — Forfeited, expired or cancelled ( 10,489 ) 242.03 — — Outstanding at March 31, 2023 63,789 174.70 8.70 35,644 Vested and expected to vest at March 31, 2023 63,789 174.70 8.70 35,644 Exercisable at March 31, 2023 22,383 463.61 6.97 — |
Schedule of Restricted Stock Units Activity | The following table summarizes RSU activity and related information under the 2021 EIP Plan for the three months ended March 31, 2023: Number of Weighted Weighted Non-vested at December 31, 2022 — $ — — Granted 44,632 3.25 — Vested — — — Forfeited ( 2,479 ) 3.15 — Non-vested at March 31, 2023 42,153 3.26 1.47 |
Schedule of Stock-based Compensation for all Stock Awards | The allocation of stock-based compensation for all stock awards is as follows (in thousands): Three Months Ended March 31, 2023 2022 Research and development expense $ 49 $ 52 General and administrative expense 44 306 Total $ 93 $ 358 |
Note 9 - Commitments and Cont_2
Note 9 - Commitments and Contingencies (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Maturities of the Company's operating lease liabilities | Maturities of the Company's operating lease liabilities as of March 31, 2023 are as follows: Year ending December 31, 2023 (remaining) $ 100 2024 136 2025 93 Total operating lease payments 329 Less: imputed interest ( 38 ) Total operating lease obligations $ 291 |
Note 1 - Organization, Busine_2
Note 1 - Organization, Business and Financial Condition (Details) $ in Thousands | Mar. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | Mar. 31, 2022 USD ($) | Apr. 27, 2021 |
Retained earnings (Accumulated deficit), ending balance | $ 111,500 | |||
Cash and cash equivalents | $ 13,297 | $ 12,383 | $ 6,644 | |
Merger Agreement with Leading Biosciences, Inc. [Member] | ||||
Merger agreement, exchange ratio | 0.02719 |
Note 2 - Summary of Significa_4
Note 2 - Summary of Significant Accounting Policies (Details Textual) | 3 Months Ended | ||
Mar. 31, 2023 USD ($) Segment | Mar. 31, 2022 USD ($) | Dec. 31, 2022 USD ($) | |
Summary Of Significant Accounting Policies [Line Items] | |||
Number of operating segments | Segment | 1 | ||
Restricted cash | $ 26,000 | $ 26,000 | |
Deferred equity issuance costs | 93,000 | 114,000 | |
Accrued clinical trial costs | 94,000 | $ 184,000 | |
License revenue | 250,000 | $ 0 | |
License [Member] | |||
Summary Of Significant Accounting Policies [Line Items] | |||
License revenue | $ 300 |
Note 2 - Summary of Significa_5
Note 2 - Summary of Significant Accounting Policies - Calculation of Weighted Average Shares Used to Calculate Basic and Diluted (Loss) Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | ||
Basic net loss per common share: | |||
Net loss | $ (2,340) | $ (4,205) | |
Weighted average shares used in calculating basic loss per common share | [1] | 4,315,526 | 324,473 |
Basic net loss per common share | [1] | $ (0.54) | $ (12.96) |
Diluted net (loss) per common share: | |||
Net loss | $ (2,340) | $ (4,205) | |
Weighted average shares used in calculating diluted loss per common share | [1] | 4,315,526 | 324,473 |
Diluted net loss per common share | [1] | $ (0.54) | $ (12.96) |
[1] (*) Basic and diluted loss per common share and basic and diluted weighted average share used in computing basic and diluted loss per common share for the three months ended March 31, 2022 have been adjusted to reflect the 1-for-50 reverse stock split effected on November 16, 2022. |
Note 2 - Summary of Significa_6
Note 2 - Summary of Significant Accounting Policies - Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share (Details) - shares | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Anti-dilutive securities (in shares) | 1,710,492 | 138,015 |
Stock option [Member] | ||
Anti-dilutive securities (in shares) | 63,789 | 30,965 |
Restricted Stock Units [Member] | ||
Anti-dilutive securities (in shares) | 42,153 | 0 |
Warrant [Member] | ||
Anti-dilutive securities (in shares) | 1,604,421 | 106,921 |
Series A Convertible Preferred Stock [Member] | ||
Anti-dilutive securities (in shares) | 129 | 129 |
Note 3 - Balance Sheet Detail_2
Note 3 - Balance Sheet Details - Summary of Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Disclosure Text Block [Abstract] | ||
Prepaid insurance | $ 355 | $ 581 |
Other receivables | 78 | 1,438 |
Prepaid subscriptions and fees | 193 | 157 |
Prepaid software licenses | 37 | 54 |
Deferred equity issuance costs | 93 | 114 |
Prepaid other | 6 | 6 |
Prepaid expenses and other current assets | $ 762 | $ 2,350 |
Note 3 - Balance Sheet Detail_3
Note 3 - Balance Sheet Details (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Disclosure Text Block [Abstract] | |||
Cash Receivable For Exercises Of Warrants Included In Prepaid And Other Assets And Other Noncurrent Assets | $ 47,600 | $ 0 | $ 1,400,000 |
Note 3 - Balance Sheet Detail_4
Note 3 - Balance Sheet Details - Summary of Other Noncurrent Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Disclosure Text Block [Abstract] | ||
Prepaid insurance, less current portion | $ 631 | $ 682 |
Other noncurrent assets | 12 | 12 |
Other noncurrent assets, Total | $ 643 | $ 694 |
Note 3 - Balance Sheet Detail_5
Note 3 - Balance Sheet Details - Summary of Accrued Liabilities (Details) - USD ($) | Mar. 31, 2023 | Dec. 31, 2022 |
Disclosure Text Block [Abstract] | ||
Accrued accounts payable | $ 73,000 | $ 69,000 |
Accrued clinical trial costs | 94,000 | 184,000 |
Accrued director stipends | 108,000 | 141,000 |
Accrued severance and benefits | 5,000 | 180,000 |
Accrued other | 29,000 | |
Accrued liabilities, current, Total | $ 309,000 | $ 574,000 |
Note 4 - Common Stock Warrant_2
Note 4 - Common Stock Warrants (Details) - USD ($) | 3 Months Ended | ||||||||
Jan. 04, 2024 | Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2021 | Apr. 03, 2023 | Jan. 04, 2023 | Dec. 31, 2022 | Jan. 31, 2022 | Aug. 19, 2021 | |
Warrants exercise price | $ 172.50 | ||||||||
Weighted-average exercise price | $ 174.70 | $ 311.74 | |||||||
Warrants outstanding | 1,604,421 | 1,055,672 | |||||||
Warrant liability | $ 18,000 | $ 61,000 | |||||||
Warrants and Rights Outstanding | $ 1,604,421 | $ 1,055,672 | |||||||
Number of Options Exercised (in shares) | 0 | ||||||||
Private Placement [Member] | |||||||||
Warrants exercise price | $ 2.375 | ||||||||
Date of issuance of warrant | 5 years | ||||||||
Conversion of warrant into common stock | 1,052,631 | ||||||||
Private Placement [Member] | Subsequent Event [Member] | |||||||||
Warrants exercise price | $ 2.375 | $ 2.64 | |||||||
Date of issuance of warrant | 5 years | 5 years | |||||||
Conversion of warrant into common stock | 1,052,631 | 2,272,723 | |||||||
Offering Placement [Member] | Subsequent Event [Member] | |||||||||
Warrants exercise price | $ 2.9688 | ||||||||
Date of issuance of warrant | 5 years | ||||||||
Conversion of warrant into common stock | 63,158 | ||||||||
278,162 common stock [Member] | |||||||||
Common stock warrants | 278,162 | ||||||||
Warrants exercise price | $ 2.38 | ||||||||
1,012,631 Common Stock [Member] | |||||||||
Common stock warrants | 1,012,631 | ||||||||
Warrants exercise price | $ 2.375 | ||||||||
63,158 common stock [Member] | |||||||||
Common stock warrants | 63,158 | ||||||||
Warrants exercise price | $ 2.9668 | ||||||||
250,470 common stock [Member] | |||||||||
Common stock warrants | 250,470 | ||||||||
Weighted-average exercise price | $ 104.24 | ||||||||
Pre Funded Warrants [Member] | Private Placement [Member] | |||||||||
Common stock warrants | 2.3749 | ||||||||
Warrants exercise price | $ 0.0001 | ||||||||
Conversion of warrant into common stock | 538,789 | ||||||||
Pre Funded Warrants [Member] | Private Placement [Member] | Subsequent Event [Member] | |||||||||
Common stock warrants | 2.6399 | ||||||||
Warrants exercise price | $ 0.0001 | $ 0.0001 | |||||||
Conversion of warrant into common stock | 538,789 | 1,061,164 | |||||||
The Equity Warrant [Member] | |||||||||
Warrant liability | $ 1,100,000 | ||||||||
Senior Secured Promissory Note Warrants [Member] | |||||||||
Warrants exercise price | $ 194 | ||||||||
Conversion of warrant into common stock | 17,177 | ||||||||
Senior Secured Promissory Note Warrants [Member] | Altium Growth Fund, LP [Member] | |||||||||
Date of issuance of warrant | 5 years | ||||||||
May 2021 Warrants [Member] | Altium Growth Fund, LP [Member] | |||||||||
Warrants outstanding | 0 | ||||||||
Number of Options Exercised (in shares) | 79,886 | 26,186 | |||||||
July 2021 Warrants [Member] | Altium Growth Fund, LP [Member] | |||||||||
Warrants exercise price | $ 181.50 | ||||||||
Conversion of warrant into common stock | 22,000 | ||||||||
January 2022 Warrants [Member] | Altium Growth Fund, LP [Member] | |||||||||
Warrants exercise price | $ 55 | ||||||||
Conversion of warrant into common stock | 45,000 | ||||||||
January 2023 Registered Direct Offering and Private Placement Warrants [member] | Pre Funded Warrants [Member] | Subsequent Event [Member] | |||||||||
Common stock warrants | 2.3749 | ||||||||
Issuance of stock during period, Shares | 37,000 | ||||||||
January Two Thousand and Twenty Three Registered Direct Offering [Member] | Pre Funded Warrants [Member] | Subsequent Event [Member] | |||||||||
Warrants exercise price | $ 0.0001 |
Note 4 - Common Stock Warrant_3
Note 4 - Common Stock Warrants - Summary of Warrant Activity (Details) - $ / shares | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 | Dec. 31, 2022 | |
Warrants and Rights Note Disclosure [Abstract] | ||
Number of Warrants Outstanding, Beginning Balance | 1,055,672 | |
Number of Warrants Outstanding, Granted | 1,691,578 | |
Number of Warrants Outstanding, Exercised | (1,142,829) | |
Number of Warrants Outstanding, Ending Balance | 1,604,421 | 1,055,672 |
Weighted Average Exercise Price, Warrants Outstanding | $ 18.26 | $ 26.48 |
Weighted Average Exercise Price, Warrants outstanding, Granted | 1.59 | |
Weighted Average Exercise Price, Warrants outstanding, Exercised | $ 1.18 | |
Weighted Average Remaining Contractual Life, Warrants Outstanding | 4 years 4 months 28 days | 3 years 3 months 25 days |
Weighted Average Remaining Contractual Life, Granted | 4 years 9 months 3 days | |
Weighted Average Remaining Contractual Life, Exercised | 1 year 4 months 24 days |
Note 5 - Fair Value Measureme_3
Note 5 - Fair Value Measurements (Details) $ in Thousands | Mar. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) |
Warrant liability | $ 18 | $ 61 |
January 2022 [Member] | ||
Warrant liability | $ 15,200 | |
Warrants and Rights Outstanding, Measurement Input | 3.35 | |
January 2022 [Member] | Measurement Input, Price Volatility [Member] | ||
Warrants and Rights Outstanding, Measurement Input | 81.3 | |
January 2022 [Member] | Measurement Input, Risk Free Interest Rate [Member] | ||
Warrants and Rights Outstanding, Measurement Input | 3.67 | |
January 2022 [Member] | Measurement Input, Expected Term [Member] | ||
Warrants and Rights Outstanding, Measurement Input | 4.33 | |
January 2022 [Member] | Measurement Input, Expected Dividend Rate [Member] | ||
Warrants and Rights Outstanding, Measurement Input | 0 | |
January 2022 [Member] | Measurement Input, Exercise Price [Member] | ||
Warrants and Rights Outstanding, Measurement Input | 55 |
Note 5 - Fair Value Measureme_4
Note 5 - Fair Value Measurements - Activity for Items Measured at Fair Value on a Recurring Basis (Details) - Stock Purchase Warrants [Member] - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Balance, Beginning | $ 61 | $ 2,651 |
Initial fair value at the original issuance date | 0 | 1,110 |
Change in fair value during the period | (43) | (793) |
Fair value of liability classified warrants exercised | 0 | (1,274) |
Balance, Ending | $ 18 | $ 1,694 |
Note 6 - Stockholders' Equity_2
Note 6 - Stockholders' Equity (Deficit) (Details Textual) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | ||||||
Jan. 04, 2023 | Nov. 15, 2022 | Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | Dec. 30, 2022 | Aug. 19, 2021 | |
Common Stock, Shares Authorized (in shares) | 280,000,000 | 280,000,000 | |||||
Common Stock, Par or Stated Value Per Share (in dollars per share) | $ 0.01 | $ 0.01 | |||||
Warrants exercise price | $ 172.50 | ||||||
Proceeds from issuance of common stock and warrants | $ 2,231 | $ 0 | |||||
Payment of equity issuance costs | $ 413 | $ 0 | |||||
Common stock, shares outstanding (in shares) | 4,563,977 | 2,944,306 | |||||
Common stock, shares issued (in shares) | 4,563,977 | 2,944,306 | |||||
Private Placement [Member] | |||||||
Warrants to purchase shares of common stock | 1,052,631 | ||||||
Warrants exercise price | $ 2.375 | ||||||
Date of issuance of warrant | 5 years | ||||||
Private Placement [Member] | Pre Funded Warrants [Member] | |||||||
Warrants to purchase shares of common stock | 538,789 | ||||||
Warrants exercise price | $ 0.0001 | ||||||
Common stock warrants | 2.3749 | ||||||
January 2023 Registered Direct Offering and Private Placement | |||||||
Common Stock, Par or Stated Value Per Share (in dollars per share) | $ 0.01 | ||||||
Offering shares (Per share) | 476,842 | ||||||
Shares Issued, Price Per Share | $ 2.375 | ||||||
Proceeds from issuance of common stock and warrants | $ 2,500 | ||||||
Payment of equity issuance costs | 300 | ||||||
Net Proceeds | 2,200 | ||||||
Grant date fair value | $ 200 | ||||||
January 2023 Registered Direct Offering and Private Placement | Pre Funded Warrants [Member] | |||||||
Offering shares (Per share) | 37,000 | ||||||
Warrants exercise price | $ 0.0001 | ||||||
Common stock warrants | 2.3749 | ||||||
January 2023 Placement Agent Warrants | |||||||
Warrants to purchase shares of common stock | 63,158 | ||||||
Warrants exercise price | $ 2.9688 | ||||||
Date of issuance of warrant | 5 years | ||||||
Common Stock [Member] | |||||||
Offering shares (Per share) | 50 | ||||||
Common Stock [Member] | Maximum [Member] | |||||||
Reverse stock split fractional share settlement | 1,541,508 | ||||||
Common Stock [Member] | Minimum [Member] | |||||||
Reverse stock split fractional share settlement | 77,080,169 | ||||||
Series A 4.5% Convertible Preferred Stock [Member] | |||||||
Preferred Stock, Shares Authorized (in shares) | 1,000,000 | ||||||
Preferred Stock, Par or Stated Value Per Share (in dollars per share) | $ 0.01 | ||||||
Convertible Preferred Stock, Issuable Upon Conversion of All Shares (in shares) | 129 | ||||||
Series A Preferred Stock [Member] | |||||||
Preferred Stock, Shares Authorized (in shares) | 7,000,000 | 7,000,000 | |||||
Preferred Stock, Par or Stated Value Per Share (in dollars per share) | $ 0.01 | $ 0.01 | |||||
Preferred stock, shares issued (in shares) | 200,000 | ||||||
Common stock, shares outstanding (in shares) | 200,000 | ||||||
Common stock, shares issued (in shares) | 200,000 |
Note 7 - Equity Incentive Pla_2
Note 7 - Equity Incentive Plans (Details Textual) $ / shares in Units, $ in Thousands | 3 Months Ended | ||
Feb. 06, 2023 Days $ / shares shares | Mar. 31, 2023 USD ($) $ / shares shares | Dec. 31, 2013 shares | |
Number of Options Granted (in shares) | 30,620 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value (in dollars per share) | $ / shares | $ 0.51 | ||
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Aggregate Intrinsic Value, Vested | $ | $ 100 | ||
Share-based Payment Arrangement, Nonvested Award, Option, Cost Not yet Recognized, Amount | $ | $ 500 | ||
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Period for Recognition (Year) | 1 year 10 months 2 days | ||
Management [Member] | |||
Number of Options Granted (in shares) | 81,500 | ||
Stock option [Member] | Management [Member] | |||
Share based compensation expense | $ | $ 0 | ||
Restricted Stock Units [Member] | |||
Unrecognized compensation cost related to outstanding RSUs | $ | $ 100 | ||
Number of Restricted Stock Units, Granted | 0 | ||
Number of Restricted Stock Units, Vested | 0 | ||
Non-vested, Weighted Average Contractual Life (Years) | 1 year 5 months 19 days | ||
Restricted Stock Units [Member] | Management [Member] | |||
Number of Restricted Stock Units, Granted | 59,500 | ||
Share based compensation expense | $ | $ 0 | ||
Performance Based Stock Units [Member] | |||
Number of Restricted Stock Units, Granted | 68,700 | ||
Performance Based Stock Units [Member] | Tranche One [Member] | |||
Exercise price | $ / shares | $ 3.20 | ||
Award Vesting Rights Percentage | 50% | ||
Consecutive trading day period | Days | 20 | ||
Performance Based Stock Units [Member] | Tranche Two [Member] | |||
Exercise price | $ / shares | $ 4.25 | ||
Award Vesting Rights Percentage | 50% | ||
Consecutive trading day period | Days | 20 | ||
Performance Based Stock Units [Member] | Management [Member] | |||
Share based compensation expense | $ | $ 0 | ||
The 2021 Plan [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 70,672 | ||
The 2021 Plan [Member] | Restricted Stock Units [Member] | |||
Number of Restricted Stock Units, Granted | 44,632 | ||
Number of Restricted Stock Units, Vested | 0 | ||
Exercise price | $ / shares | $ 3.26 | ||
Non-vested, Weighted Average Contractual Life (Years) | 1 year 5 months 19 days | ||
2013 Plan [Member] | |||
Common Stock, Capital Shares Reserved for Future Issuance (in shares) | 0 | ||
The 2021 ESPP [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 34,603 | ||
2021 Inducement Plan [Member] | |||
Number of Options Granted (in shares) | 6,574 |
Note 7 - Equity Incentive Pla_3
Note 7 - Equity Incentive Plans - Schedule of Fair Value of Options Granted (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Disclosure Text Block [Abstract] | ||
Weighted-average exercise price per share | $ 2.36 | $ 48.67 |
Weighted-average expected term (years) | 5 years 9 months 21 days | 5 years 9 months 21 days |
Weighted-average risk-free interest rate | 3.76% | 1.85% |
Weighted-average expected dividend yield | $ 0 | $ 0 |
Weighted-average volatility | 69.54% | 73.77% |
Note 7 - Equity Incentive Pla_4
Note 7 - Equity Incentive Plans - Schedule of Summarized Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 | Dec. 31, 2022 | |
Disclosure Text Block [Abstract] | ||
Number of Options Outstanding (in shares) | 43,658 | |
Number of Options Granted (in shares) | 30,620 | |
Number of Options Exercised (in shares) | 0 | |
Number of Options Forfeited, expired or cancelled (in shares) | (10,489) | |
Number of Options Outstanding (in shares) | 63,789 | 43,658 |
Number of Options Vested and expected to vest (in shares) | 63,789 | |
Number of Options Exercisable (in shares) | 22,383 | |
Options Outstanding, Weighted Average Exercise Price (in dollars per share) | $ 311.74 | |
Options Granted, Weighted Average Exercise Price (in dollars per share) | 2.36 | |
Options Forfeited, expired or cancelled, Weighted Average Exercise Price (in dollars per share) | 242.03 | |
Options Outstanding, Weighted Average Exercise Price (in dollars per share) | 174.70 | $ 311.74 |
Options Vested and expected to vest, Weighted Average Exercise Price (in dollars per share) | 174.70 | |
Options Exercisable, Weighted Average Exercise Price (in dollars per share) | $ 463.61 | |
Options Outstanding, Weighted Average Remaining Contractual Life (Year) | 8 years 8 months 12 days | 6 years 29 days |
Granted, Weighted Average Remaining Contractual Life (Year) | 9 years 10 months 17 days | |
Options Vested and expected to vest, Weighted Average Remaining Contractual Life (Year) | 8 years 8 months 12 days | |
Options Exercisable, Weighted Average Remaining Contractual Life (Year) | 6 years 11 months 19 days | |
Options Outstanding, Aggregate Intrinsic Value | $ 35,644 | $ 0 |
Options Vested and expected to vest, Aggregate Intrinsic Value | 35,644 | |
Options Exercisable, Aggregate Intrinsic Value | $ 0 |
Note 7 - Equity Incentive Pla_5
Note 7 - Equity Incentive Plans - Schedule of Restricted Stock Units Activity (Details) - Restricted Stock Units (RSUs) [Member] | 3 Months Ended |
Mar. 31, 2023 $ / shares shares | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Number of Restricted Stock Units, Granted | 0 |
Number of Restricted Stock Units, Vested | 0 |
Non-vested, Weighted Average Contractual Life (Years) | 1 year 5 months 19 days |
The 2021 Plan [Member] | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Number of Restricted Stock Units, Non-vested | 0 |
Number of Restricted Stock Units, Granted | 44,632 |
Number of Restricted Stock Units, Vested | 0 |
Number of Restricted Stock Units, Forfeited | (2,479) |
Number of Restricted Stock Units, Non-vested | 42,153 |
Granted, Weighted Average Grant Date Fair Value | $ / shares | $ 3.25 |
Forfeited, Weighted Average Grant Date Fair Value | $ / shares | 3.15 |
Non-vested, Weighted Average Grant Date Fair Value | $ / shares | $ 3.26 |
Non-vested, Weighted Average Contractual Life (Years) | 1 year 5 months 19 days |
Note 7 - Equity Incentive Pla_6
Note 7 - Equity Incentive Plans - Schedule of Stock-based Compensation for all Stock Awards (Details - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Share-based compensation expense | $ 93 | $ 358 |
Research and Development Expense [Member] | ||
Share-based compensation expense | 49 | 52 |
General and Administrative Expense [Member] | ||
Share-based compensation expense | $ 44 | $ 306 |
Note 8 - Collaborations and L_2
Note 8 - Collaborations and License Agreements (Details Textual)) | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2023 USD ($) Agreement | Mar. 31, 2022 USD ($) | Dec. 31, 2018 USD ($) | Dec. 31, 2022 USD ($) | |
Collaborations and License Agreements Upfront Fee | $ 1,000,000 | |||
Royalty Expense | $ 6,750,000 | |||
License revenue | $ 300,000 | |||
Accounts Receivable | $ 250,000 | $ 0 | ||
Milestone Payments | $ 0 | |||
License Agreements with the Regents of the University of California [Member] | ||||
Number of License Agreements | Agreement | 3 | |||
Accrued Royalties, Current | $ 36,000,000 | $ 13,000,000 | ||
License Agreements with the Regents of the University of California [Member] | Maximum [Member] | ||||
Royalty Rate, Portion of Sublicense Income to Be Paid, Percentage of One-third of Upfront Payment and Milestone Payment Received | 35% | |||
License Agreements with the Regents of the University of California [Member] | Minimum [Member] | ||||
Royalty Rate, Portion of Sublicense Income to Be Paid, Percentage of One-third of Upfront Payment and Milestone Payment Received | 30% |
Note 9 - Commitments and Cont_3
Note 9 - Commitments and Contingencies (Details Textual) | 3 Months Ended | ||||||||
Jun. 01, 2022 USD ($) | May 24, 2022 | May 09, 2022 | Jun. 30, 2023 USD ($) | Mar. 31, 2023 USD ($) | Mar. 31, 2022 USD ($) | Dec. 31, 2022 USD ($) | Sep. 09, 2022 | May 12, 2022 ft² | |
Loss Contingencies [Line Items] | |||||||||
Operating Lease, Right-of-Use Asset | $ 275,000 | $ 300,000 | |||||||
Operating Lease, Liability, Current | 109,000 | 105,000 | |||||||
Operating Lease, Liability, Noncurrent | 182,000 | 211,000 | |||||||
Accrued severance and benefits | 5,000 | 180,000 | |||||||
Imputed interest | 38,000 | ||||||||
Accrued Liabilities [Member] | |||||||||
Loss Contingencies [Line Items] | |||||||||
Accrued severance and benefits | 5,000 | 180,000 | |||||||
Cost Reduction Plan [Member] | |||||||||
Loss Contingencies [Line Items] | |||||||||
Reduction In Work Force | 20% | ||||||||
Restructuring Costs | 0 | $ 0 | |||||||
Employee Severance And Benefit | |||||||||
Loss Contingencies [Line Items] | |||||||||
Payments for restructuring | 175,000 | ||||||||
Employee Severance And Benefit | Forecast [Member] | |||||||||
Loss Contingencies [Line Items] | |||||||||
Payments for restructuring | $ 5,000 | ||||||||
Insurance Financing Arrangement [Member] | |||||||||
Loss Contingencies [Line Items] | |||||||||
Line of Credit Facility, Interest Rate During Period | 6.92% | 3.82% | |||||||
Line of Credit Facility, Expiration Period | 10 months | 9 months | |||||||
Remaining balance under insurance financing arrangements | 0 | $ 100,000 | |||||||
Base Rate [Member] | |||||||||
Loss Contingencies [Line Items] | |||||||||
Base Rent Rate Percentage | 50% | ||||||||
Corporate Office [Member] | |||||||||
Loss Contingencies [Line Items] | |||||||||
Area of real estate property (Square Foot) | ft² | 2,747 | ||||||||
Lessee, operating lease, term of contract (Month) | 39 months | ||||||||
Lessee, operating lease, renewal term (Month) | 36 months | ||||||||
Lease monthly payment | $ 10,850 | ||||||||
Operating lease, contractual monthly lease payments, yearly escalation rate | 3% | ||||||||
Payments for (Proceeds from) Tenant Allowance | $ 28,000 | ||||||||
Operating Lease, Right-of-Use Asset | 275,000 | ||||||||
Operating Lease, Liability, Current | 109,000 | ||||||||
Operating Lease, Liability, Noncurrent | $ 182,000 | ||||||||
Lessee, Operating Lease, Discount Rate | 10.75% | ||||||||
Lessee, Operating Lease, Remaining Lease Term | 2 years 4 months 24 days | ||||||||
Operating Lease, Expense | $ 32,000 | $ 49,000 | |||||||
Imputed interest | 38,000 | ||||||||
Total remaining future minimum lease payments | $ 291,000 |
Note 9 - Commitments and Cont_4
Note 9 - Commitments and Contingencies - Schedule of Maturities of the Company's operating lease liabilities (Details) $ in Thousands | Mar. 31, 2023 USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2023 (remaining) | $ 100 |
2024 | 136 |
2025 | 93 |
Total operating lease payments | 329 |
Less: imputed interest | (38) |
Total operating lease obligations | $ 291 |
Note 10 - Related Party Trans_2
Note 10 - Related Party Transactions (Details Textual) - USD ($) | Mar. 31, 2023 | Dec. 31, 2022 | Oct. 11, 2022 | Aug. 19, 2021 |
Warrants to purchase common stock | 7,549 | |||
Warrants exercise price | $ 172.50 | |||
Warrants,expiration date | Aug. 26, 2026 | |||
Due to related parties, total | $ 107,500 | $ 141,250 | ||
Chief Executive Officer [Member] | ||||
Compensation to the Former Chief Executive Officer | $ 22,000 |
Note 11 - Subsequent Events (De
Note 11 - Subsequent Events (Details Textual) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |||||
Apr. 03, 2023 | Mar. 31, 2023 | Mar. 31, 2022 | Jan. 04, 2024 | Jan. 04, 2023 | Aug. 19, 2021 | |
Subsequent Event [Line Items] | ||||||
Warrants exercise price | $ 172.50 | |||||
Proceeds from issuance of common stock and warrants | $ 2,231 | $ 0 | ||||
Payment of equity issuance costs | $ 413 | $ 0 | ||||
Private Placement [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Warrants to purchase shares of common stock | 1,052,631 | |||||
Warrants exercise price | $ 2.375 | |||||
Warrants and Rights Outstanding, Term (Year) | 5 years | |||||
April 2023 Placement Agent Warrants [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Warrants to purchase shares of common stock | 136,363 | |||||
Warrants exercise price | $ 3.30 | |||||
Warrants and Rights Outstanding, Term (Year) | 5 years | |||||
Pre Funded Warrants [Member] | Private Placement [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Warrants to purchase shares of common stock | 538,789 | |||||
Common stock warrants | 2.3749 | |||||
Warrants exercise price | $ 0.0001 | |||||
Subsequent Event [Member] | Private Placement [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Warrants to purchase shares of common stock | 2,272,723 | 1,052,631 | ||||
Warrants exercise price | $ 2.64 | $ 2.375 | ||||
Warrants and Rights Outstanding, Term (Year) | 5 years | 5 years | ||||
Subsequent Event [Member] | April2023 Registered Direct Offering And Private Placement [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Issuance of stock during period, Shares | 756,317 | |||||
Shares Issued, Price Per Share (in dollars per share) | $ 2.64 | |||||
Proceeds from issuance of common stock and warrants | $ 6,000 | |||||
Net Proceeds | 5,400 | |||||
Payment of equity issuance costs | $ 600 | |||||
Subsequent Event [Member] | Unregistered Shares [Member] | April 2023 Offering [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Issuance of stock during period, Shares | 455,242 | |||||
Shares Issued, Price Per Share (in dollars per share) | $ 2.64 | |||||
Subsequent Event [Member] | Pre Funded Warrants [Member] | Private Placement [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Warrants to purchase shares of common stock | 1,061,164 | 538,789 | ||||
Common stock warrants | 2.6399 | |||||
Warrants exercise price | $ 0.0001 | $ 0.0001 |