Cover
Cover - shares | 6 Months Ended | |
Jun. 30, 2022 | Aug. 08, 2022 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Jun. 30, 2022 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2022 | |
Current Fiscal Year End Date | --12-31 | |
Entity File Number | 001-35814 | |
Entity Registrant Name | Harrow Health, Inc. | |
Entity Central Index Key | 0001360214 | |
Entity Tax Identification Number | 45-0567010 | |
Entity Incorporation, State or Country Code | DE | |
Entity Address, Address Line One | 102 Woodmont Blvd. | |
Entity Address, Address Line Two | Suite 610 | |
Entity Address, City or Town | Nashville | |
Entity Address, State or Province | TN | |
Entity Address, Postal Zip Code | 37205 | |
City Area Code | (615) | |
Local Phone Number | 733-4730 | |
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 | 27,069,978 | |
Common Stock, $0.001 Par Value Per Share [Member] | ||
Title of 12(b) Security | Common Stock, $0.001 par value per share | |
Trading Symbol | HROW | |
Security Exchange Name | NASDAQ | |
8.625% Senior Notes Due 2026 [Member] | ||
Title of 12(b) Security | 8.625% Senior Notes due 2026 | |
Trading Symbol | HROWL | |
Security Exchange Name | NASDAQ |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Jun. 30, 2022 | Dec. 31, 2021 |
Current assets | ||
Cash and cash equivalents | $ 46,438,000 | $ 42,167,000 |
Investment in Eton Pharmaceuticals | 5,193,000 | 8,503,000 |
Accounts receivable, net | 6,755,000 | 4,470,000 |
Inventories | 5,132,000 | 4,217,000 |
Prepaid expenses and other current assets | 1,185,000 | 1,305,000 |
Total current assets | 64,703,000 | 60,662,000 |
Property, plant and equipment, net | 2,792,000 | 3,141,000 |
Capitalized software development costs, net | 1,758,000 | 1,313,000 |
Operating lease right-of-use assets | 7,860,000 | 5,935,000 |
Intangible assets, net | 15,016,000 | 15,813,000 |
Investment in Melt Pharmaceuticals | 5,601,000 | 11,133,000 |
Goodwill | 332,000 | 332,000 |
TOTAL ASSETS | 98,062,000 | 98,329,000 |
Current liabilities | ||
Accounts payable and accrued expenses | 9,201,000 | 6,337,000 |
Accrued payroll and related liabilities | 3,005,000 | 3,089,000 |
Deferred revenue and customer deposits | 83,000 | 16,000 |
Current portion of operating lease obligations | 633,000 | 272,000 |
Current portion of finance lease obligations | 8,000 | |
Total current liabilities | 12,922,000 | 9,722,000 |
Operating lease obligations, net of current portion | 7,704,000 | 6,012,000 |
Finance lease obligations, net of current portion | 10,000 | |
Loans payable, net of unamortized debt discount | 72,042,000 | 71,654,000 |
TOTAL LIABILITIES | 92,668,000 | 87,398,000 |
Commitments and contingencies | ||
STOCKHOLDERS’ EQUITY | ||
Common stock, $0.001 par value, 50,000,000 shares authorized, 27,069,978 and 26,902,763 shares issued and outstanding at June 30, 2022 and December 31, 2021, respectively | 27,000 | 27,000 |
Additional paid-in capital | 109,806,000 | 106,666,000 |
Accumulated deficit | (104,084,000) | (95,407,000) |
TOTAL HARROW HEALTH STOCKHOLDERS’ EQUITY | 5,749,000 | 11,286,000 |
Noncontrolling interests | (355,000) | (355,000) |
TOTAL STOCKHOLDERS’ EQUITY | 5,394,000 | 10,931,000 |
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ 98,062,000 | $ 98,329,000 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Jun. 30, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, sharess authorized | 50,000,000 | 50,000,000 |
Common stock, shares issued | 27,069,978 | 26,902,763 |
Common stock, shares outstanding | 27,069,978 | 26,902,763 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Revenues: | ||||
Total revenues | $ 23,323,000 | $ 18,134,000 | $ 45,443,000 | $ 33,577,000 |
Cost of sales | (6,534,000) | (4,417,000) | (12,497,000) | (8,187,000) |
Gross profit | 16,789,000 | 13,717,000 | 32,946,000 | 25,390,000 |
Operating expenses: | ||||
Selling, general and administrative | 14,185,000 | 9,123,000 | 27,583,000 | 17,287,000 |
Research and development | 914,000 | 425,000 | 1,572,000 | 1,017,000 |
Total operating expenses | 15,099,000 | 9,548,000 | 29,155,000 | 18,304,000 |
Income from operations | 1,690,000 | 4,169,000 | 3,791,000 | 7,086,000 |
Other (expense) income: | ||||
Interest expense, net | (1,794,000) | (1,314,000) | (3,586,000) | (1,827,000) |
Equity in losses of unconsolidated entities | (2,646,000) | (942,000) | (5,532,000) | (2,261,000) |
Investment loss from Eton Pharmaceuticals | (3,449,000) | (3,584,000) | (3,310,000) | (6,419,000) |
Loss on early extinguishment of debt | (756,000) | (756,000) | ||
Gain on forgiveness of PPP loan | 1,967,000 | |||
Other expense, net | (51,000) | (51,000) | ||
Total other expense, net | (7,889,000) | (6,647,000) | (12,428,000) | (9,347,000) |
Loss before income taxes | (6,199,000) | (2,478,000) | (8,637,000) | (2,261,000) |
Income taxes | (40,000) | (40,000) | ||
Net loss | (6,239,000) | (2,478,000) | (8,677,000) | (2,261,000) |
Preferred dividends and accretion of preferred stock issuance costs | (472,000) | (472,000) | ||
Net loss attributable to common stockholders | $ (6,239,000) | $ (2,950,000) | $ (8,677,000) | $ (2,733,000) |
Basic and diluted net loss per share of common stock | $ (0.23) | $ (0.11) | $ (0.32) | $ (0.10) |
Weighted average number of shares of common stock outstanding, basic and diluted | 27,303,458 | 26,736,970 | 27,265,350 | 26,379,943 |
Product Sales Net [Member] | ||||
Revenues: | ||||
Total revenues | $ 21,518,000 | $ 17,297,000 | $ 41,858,000 | $ 32,245,000 |
Other Revenues [Member] | ||||
Revenues: | ||||
Total revenues | $ 1,805,000 | $ 837,000 | $ 3,585,000 | $ 1,332,000 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) | Preferred Stock [Member] | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | Total Harrow Health, Inc. Stockholders' Equity [Member] | Noncontrolling Interest [Member] | Total |
Beginning balance, value at Dec. 31, 2020 | $ 26,000 | $ 104,557,000 | $ (77,400,000) | $ 27,183,000 | $ (355,000) | $ 26,828,000 | |
Beginning Balance, shares at Dec. 31, 2020 | 25,749,875 | ||||||
Exercise of warrants | |||||||
Exercise of warrants, shares | 311,369 | ||||||
Exercise of employee stock options | 48,000 | 48,000 | 48,000 | ||||
Exercise of employee stock options, shares | 16,613 | ||||||
Vesting of RSUs | $ 1,000 | (1,000) | |||||
Vesting of RSUs, shares | 1,207,500 | ||||||
Shares withheld related to net share settlement of equity awards | (3,228,000) | (3,228,000) | (3,228,000) | ||||
Shares withheld related to net share settlement of equity awards, shares | (391,461) | ||||||
Issuance of preferred shares, net of discount and issuance costs | 10,655,000 | 10,655,000 | 10,655,000 | ||||
Issuance of preferred shares, net of discounts and issuance costs, shares | 440,000 | ||||||
Redemption of preferred shares | (11,000,000) | (11,000,000) | (11,000,000) | ||||
Redemption of preferred shares, shares | (440,000) | ||||||
Payment of preferred dividends | (127,000) | (127,000) | (127,000) | ||||
Stock-based compensation expense | 1,933,000 | 1,933,000 | 1,933,000 | ||||
Net loss | (2,261,000) | (2,261,000) | (2,261,000) | ||||
Net loss | (2,261,000) | ||||||
Ending balance, value at Jun. 30, 2021 | $ 27,000 | 102,837,000 | (79,661,000) | 23,203,000 | (355,000) | 22,848,000 | |
Ending Balance, shares at Jun. 30, 2021 | 26,893,896 | ||||||
Beginning balance, value at Mar. 31, 2021 | $ 26,000 | 105,382,000 | (77,183,000) | 28,225,000 | (355,000) | 27,870,000 | |
Beginning Balance, shares at Mar. 31, 2021 | 25,983,676 | ||||||
Exercise of warrants | |||||||
Exercise of warrants, shares | 311,369 | ||||||
Exercise of employee stock options | 21,000 | 21,000 | 21,000 | ||||
Exercise of employee stock options, shares | 5,312 | ||||||
Vesting of RSUs | $ 1,000 | (1,000) | |||||
Vesting of RSUs, shares | 977,500 | ||||||
Shares withheld related to net share settlement of equity awards | (3,171,000) | (3,171,000) | (3,171,000) | ||||
Shares withheld related to net share settlement of equity awards, shares | (383,961) | ||||||
Issuance of preferred shares, net of discount and issuance costs | 10,655,000 | 10,655,000 | 10,655,000 | ||||
Issuance of preferred shares, net of discounts and issuance costs, shares | 440,000 | ||||||
Redemption of preferred shares | (11,000,000) | (11,000,000) | (11,000,000) | ||||
Redemption of preferred shares, shares | (440,000) | ||||||
Payment of preferred dividends | (127,000) | (127,000) | (127,000) | ||||
Stock-based compensation expense | 1,078,000 | 1,078,000 | 1,078,000 | ||||
Net loss | (2,478,000) | (2,478,000) | (2,478,000) | ||||
Net loss | (2,478,000) | ||||||
Ending balance, value at Jun. 30, 2021 | $ 27,000 | 102,837,000 | (79,661,000) | 23,203,000 | (355,000) | 22,848,000 | |
Ending Balance, shares at Jun. 30, 2021 | 26,893,896 | ||||||
Beginning balance, value at Dec. 31, 2021 | $ 27,000 | 106,666,000 | (95,407,000) | 11,286,000 | (355,000) | 10,931,000 | |
Beginning Balance, shares at Dec. 31, 2021 | 26,902,763 | ||||||
Exercise of employee stock options | 7,000 | 7,000 | 7,000 | ||||
Exercise of employee stock options, shares | 91,986 | ||||||
Vesting of RSUs | $ 1,000 | (1,000) | |||||
Vesting of RSUs, shares | 185,000 | ||||||
Shares withheld related to net share settlement of equity awards | $ (1,000) | (875,000) | (876,000) | (876,000) | |||
Shares withheld related to net share settlement of equity awards, shares | (109,771) | ||||||
Payment of preferred dividends | |||||||
Stock-based compensation expense | 4,009,000 | 4,009,000 | 4,009,000 | ||||
Net loss | (8,677,000) | (8,677,000) | (8,677,000) | ||||
Ending balance, value at Jun. 30, 2022 | $ 27,000 | 109,806,000 | (104,084,000) | 5,749,000 | (355,000) | 5,394,000 | |
Ending Balance, shares at Jun. 30, 2022 | 27,069,978 | ||||||
Beginning balance, value at Mar. 31, 2022 | $ 27,000 | 107,909,000 | (97,845,000) | 10,091,000 | (355,000) | 9,736,000 | |
Beginning Balance, shares at Mar. 31, 2022 | 27,031,127 | ||||||
Exercise of employee stock options | 3,000 | 3,000 | 3,000 | ||||
Exercise of employee stock options, shares | 2,000 | ||||||
Vesting of RSUs | |||||||
Vesting of RSUs, shares | 50,000 | ||||||
Shares withheld related to net share settlement of equity awards | (99,000) | (99,000) | (99,000) | ||||
Shares withheld related to net share settlement of equity awards, shares | (13,149) | ||||||
Stock-based compensation expense | 1,993,000 | 1,993,000 | 1,993,000 | ||||
Net loss | (6,239,000) | (6,239,000) | (6,239,000) | ||||
Net loss | (6,239,000) | ||||||
Ending balance, value at Jun. 30, 2022 | $ 27,000 | $ 109,806,000 | $ (104,084,000) | $ 5,749,000 | $ (355,000) | $ 5,394,000 | |
Ending Balance, shares at Jun. 30, 2022 | 27,069,978 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
CASH FLOWS FROM OPERATING ACTIVITIES | |||
Net loss | $ (2,478,000) | $ (8,677,000) | $ (2,261,000) |
Adjustments to reconcile net loss to net cash provided by operating activities: | |||
Depreciation and amortization | 843,000 | 876,000 | |
Amortization of intangible assets | 39,000 | 802,000 | 79,000 |
Amortization of operating lease right-of-use assets | 263,000 | 299,000 | |
Provision for bad debt expense | 29,000 | 36,000 | |
Amortization of debt issuance costs and discount | 388,000 | 288,000 | |
Gain on forgiveness of PPP loan | (1,967,000) | ||
Investment loss from investment in Eton | 3,584,000 | 3,310,000 | 6,419,000 |
Equity in losses of unconsolidated entities | 942,000 | 5,532,000 | 2,261,000 |
Loss on early extinguishment of loan | 706,000 | ||
Stock-based compensation | 4,009,000 | 1,933,000 | |
Changes in assets and liabilities: | |||
Accounts receivable | (2,314,000) | (1,084,000) | |
Inventories | (915,000) | 59,000 | |
Prepaid expenses and other current assets | 120,000 | (85,000) | |
Accounts payable and accrued expenses | 2,454,000 | 1,026,000 | |
Accrued payroll and related liabilities | (84,000) | 73,000 | |
Deferred revenue and customer deposits | 67,000 | (10,000) | |
NET CASH PROVIDED BY OPERATING ACTIVITIES | 5,827,000 | 8,648,000 | |
CASH FLOWS FROM INVESTING ACTIVITIES | |||
Net proceeds on sale of investments | 9,827,000 | ||
Investment in patent and trademark assets | (5,000) | (22,000) | |
Purchases of property, plant and equipment | (664,000) | (1,360,000) | |
NET CASH (USED IN) PROVIDED BY INVESTING ACTIVITIES | (669,000) | 8,445,000 | |
CASH FLOWS FROM FINANCING ACTIVITIES | |||
Payments on finance lease obligations | (18,000) | (3,000) | |
Net proceeds from 8.625% notes payable, net of costs | 71,073,000 | ||
Principal and exit fee payments on SWK loan | (15,961,000) | ||
Payment of taxes upon vesting of RSUs | (876,000) | (3,228,000) | |
Proceeds from exercise of stock options | 7,000 | 48,000 | |
Sale of preferred stock, net of discount and issuance costs | 10,655,000 | ||
Redemption of preferred stock | (11,000,000) | ||
Payment of preferred stock dividends | (127,000) | (127,000) | |
NET CASH (USED IN) PROVIDED BY FINANCING ACTIVITIES | (887,000) | 51,457,000 | |
NET CHANGE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH | 4,271,000 | 68,550,000 | |
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, beginning of period | 42,167,000 | 4,301,000 | |
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, end of period | 72,851,000 | 46,438,000 | 72,851,000 |
RECONCILIATION OF CASH, CASH EQUIVALENTS AND RESTRICTED CASH | |||
Cash and cash equivalents | 72,651,000 | 46,438,000 | 72,651,000 |
Restricted cash | 200,000 | 200,000 | |
CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT END OF PERIOD | $ 72,851,000 | 46,438,000 | 72,851,000 |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | |||
Cash paid for income taxes | 40,000 | ||
Cash paid for interest | 3,234,000 | 788,000 | |
SUPPLEMENTAL DISCLOSURES OF NON-CASH INVESTING | |||
Purchase of property, plant and equipment included in accounts payable and accrued expenses | 275,000 | ||
Right-of-use assets obtained in exchange for new operating lease obligations | $ 2,188,000 | $ 1,753,000 |
DESCRIPTION OF BUSINESS AND BAS
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | 6 Months Ended |
Jun. 30, 2022 | |
Accounting Policies [Abstract] | |
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | NOTE 1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION Company and Background Harrow Health, Inc. (together with its subsidiaries, partially owned companies and royalty arrangements unless the context indicates or otherwise requires, the “Company” or “Harrow”) is an eyecare pharmaceutical company focused on the development, production, sale, and distribution of accessible and affordable innovative ophthalmic prescription medications. The Company owns non-controlling equity positions in Surface Ophthalmics, Inc. (“Surface”) and Melt Pharmaceuticals, Inc. (“Melt”), both companies that began as subsidiaries of Harrow. Harrow also owns royalty rights in various drug candidates being developed by Surface and Melt. Basis of Presentation The Company has prepared the accompanying unaudited condensed consolidated financial statements in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and in accordance with the rules and regulations of the U.S. Securities and Exchange Commission. Accordingly, they do not include all of the information and footnotes required by GAAP for audited financial statements. In the opinion of management, all adjustments (consisting of only normal recurring adjustments) considered necessary for a fair presentation have been included. Operating results for the three and six months ended June 30, 2022 are not necessarily indicative of the results that may be expected for the year ending December 31, 2022 or for any other period. For further information, refer to the Company’s audited consolidated financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and its wholly owned and majority-owned subsidiaries. Harrow consolidates entities in which it has a controlling financial interest. The Company assesses control under the variable interest entity (“VIE”) model to determine whether the Company is the primary beneficiary of that entity’s operations. The Company consolidates (i) entities in which it holds and/or controls, directly or indirectly, more than 50% of the voting rights, and (ii) entities that the Company deems to be a VIE. All intercompany accounts and transactions have been eliminated in consolidation. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jun. 30, 2022 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The following represents an update for the three and six months ended June 30, 2022 to the significant accounting policies described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. Risks, Uncertainties and Liquidity The Company is subject to certain regulatory standards, approvals, guidelines and inspections which could impact the Company’s ability to make, dispense, and sell certain products. If the Company was required to cease compounding and selling certain products as a result of regulatory guidelines or inspections, this may have a material impact on the Company’s financial condition, liquidity and results of operations. Segments Due to shifts in the Company’s strategic plans to further focus on growing the Company’s ImprimisRx business and suspension of activities related to starting up development-stage pharmaceutical companies, along with changes to the Company’s organizational and internal reporting structure, beginning in January 2022 management no longer evaluates the Company’s business in two segments and instead focuses on the performance of the business as a single operating business. Basic and Diluted Net Loss per Common Share Basic net loss per common share is computed by dividing net loss attributable to common stockholders for the period by the weighted average number of common shares outstanding during the period. Diluted net loss per share is computed by dividing the net loss attributable to common stockholders for the period by the weighted average number of common and common equivalent shares, such as stock options, restricted stock units (“RSUs”) and warrants, outstanding during the period. Common equivalent shares (using the treasury stock method) from stock options, unvested RSUs and warrants were 5,646,672 4,121,398 287,049 235,973 The following table shows the computation of basic net loss per share of common stock for the three and six months ended June 30, 2022 and 2021: SCHEDULE OF BASIC AND DILUTED EARNINGS PER COMMON SHARE June 30, 2022 June 30, 2021 June 30, 2022 June 30, 2021 For the For the Three Months Ended Six Months Ended June 30, 2022 June 30, 2021 June 30, 2022 June 30, 2021 Numerator – net loss attributable to common stockholders $ (6,239,000 ) $ (2,950,000 ) $ (8,677,000 ) $ (2,733,000 ) Denominator – weighted average number of shares outstanding, basic and diluted 27,303,458 26,736,970 27,265,350 26,379,943 Denominator – weighted average number of shares outstanding, basic and diluted 27,303,458 26,736,970 27,265,350 26,379,943 Net loss per share of common stock, basic and diluted $ (0.23 ) $ (0.11 ) $ (0.32 ) $ (0.10 ) Investment in Eton Pharmaceuticals, Inc As of June 30, 2022, the Company owned 1,982,000 10 2.62 Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities 3,449,000 3,310,000 3,584,000 6,419,000 5,193,000 Investment in Melt Pharmaceuticals, Inc. – Related Party The Company owns 3,500,000 46 0 100 0 100 The following table summarizes the Company’s investments in Melt as of June 30, 2022: SCHEDULE OF INVESTMENT Share of Equity Method Paid-in -Kind In-substance Capital Net Cost Basis Losses Interest Contributions Carrying value Common stock $ 5,810,000 $ (5,810,000 ) $ - $ - $ - Loan 13,500,000 (7,899,000 ) 1,484,000 (1,484,000 ) 5,601,000 $ 19,310,000 $ (13,709,000 ) $ 1,484,000 $ (1,484,000 ) $ 5,601,000 See Note 4 for more information and related party disclosure regarding Melt. Investment in Surface Ophthalmics, Inc. – Related Party The Company owns 3,500,000 20 0 The following table summarizes the Company’s investment in Surface as of June 30, 2022: SCHEDULE OF INVESTMENT Cost Share of Equity Net Basis Method Losses Carrying value Common stock $ 5,320,000 $ (5,320,000 ) $ - See Note 5 for more information and related party disclosure regarding Surface. Impairment of Equity Method Investments and Note Receivable On a quarterly basis, management assesses whether there are any indicators that the carrying value of the Company’s equity method investments and note receivable may be other than temporarily impaired. Indicators include financial condition, operating performance, and near-term prospects of the investee. To the extent indicators suggest that a loss in value may have occurred, the Company will evaluate both quantitative and qualitative factors to determine if the loss in value is other than temporary. If a potential loss in value is determined to be other than temporary, the Company will recognize an impairment loss based on the estimated fair value of the equity method investments and note receivable. At June 30, 2022 and December 31, 2021, no indicators of impairment existed. |
REVENUES
REVENUES | 6 Months Ended |
Jun. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
REVENUES | NOTE 3. REVENUES The Company accounts for contracts with customers in accordance with Accounting Standards Codification (“ASC”) 606, Revenues from Contracts with Customers. The Company has four primary streams of revenue: (1) revenue recognized from sales of products through its pharmacy and outsourcing facility and sales of branded products to wholesalers through a third-party logistics (“3PL”) facility, (2) revenue recognized from a commission agreement with a third party, (3) revenue recognized from transfer of acquired product profit, and (4) revenue recognized from intellectual property licenses and asset purchase agreements. Product Revenues The Company sells prescription drugs directly through its pharmacy, outsourcing facility and 3PL partner. Revenue from the Company’s pharmacy services includes: (i) the portion of the price the client pays directly to the Company, net of any volume-related or other discounts paid back to the client, (ii) the price paid to the Company by individuals, and (iii) customer copayments made directly to the pharmacy network. Sales taxes are not included in revenue. Following the core principles of ASC 606, the Company has identified the following: 1. Identify the contract(s) with a customer 2. Identify the performance obligations in the contract: 3. Determine the transaction price: 4. Allocate the transaction price to the performance obligations in the contract: 5. Recognize revenue when (or as) the entity satisfies a performance obligation: Commission Revenues The Company has entered into an agreement whereby it is paid a fee calculated based on sales the Company generates from a pharmaceutical product that is owned by a third party. The revenue earned from this arrangement is recognized, at which point there is no future performance obligation required by the Company and no consequential continuing involvement on the Company’s part to recognize the associated revenue. Revenues From Transfer of Acquired Product Profit The Company entered into an agreement whereby it purchased the exclusive commercial rights to assets associated with certain ophthalmic products from another pharmaceutical company (the “Seller”). During a temporary, six month transition period, the Seller continued Intellectual Property License Revenues The Company currently holds five intellectual property licenses and related agreements pursuant to which the Company has agreed to license or sell to a customer with the right to access the Company’s intellectual property. License arrangements may consist of non-refundable upfront license fees, data transfer fees, research reimbursement payments, exclusive license rights to patented or patent pending compounds, technology access fees, and various performance or sales milestones. These arrangements can be multiple-element arrangements, the revenue of which is recognized at the point in time that the performance obligation is met. Non-refundable fees that are not contingent on any future performance by the Company and require no consequential continuing involvement on the part of the Company are recognized as revenue when the license term commences and the licensed data, technology, compounded drug preparation and/or other deliverable is delivered. Such deliverables may include physical quantities of compounded drug preparations, design of the compounded drug preparations and structure-activity relationships, the conceptual framework and mechanism of action, and rights to the patents or patent applications for such compounded drug preparations. The Company defers recognition of non-refundable fees if it has continuing performance obligations without which the technology, right, product or service conveyed in conjunction with the non-refundable fee has no utility to the licensee and that are separate and independent of the Company’s performance under the other elements of the arrangement. In addition, if the Company’s continued involvement is required, through research and development services that are related to its proprietary know-how and expertise of the delivered technology or can only be performed by the Company, then such non-refundable fees are deferred and recognized over the period of continuing involvement. Guaranteed minimum annual royalties are recognized on a straight-line basis over the applicable term. Revenue disaggregated by revenue source for the three and six months ended June 30, 2022 and 2021 consists of the following: SCHEDULE OF DISAGGREGATED REVENUE 2022 2021 2022 2021 For the Three Months Ended For the Six Months Ended June 30, June 30, 2022 2021 2022 2021 Product sales, net $ 21,518,000 $ 17,297,000 $ 41,858,000 $ 32,245,000 Commission revenues 1,212,000 827,000 2,532,000 1,312,000 Transfer of profits 593,000 - 1,053,000 - License revenues - 10,000 - 20,000 Total revenues $ 23,323,000 $ 18,134,000 $ 45,443,000 $ 33,577,000 Deferred revenue and customer deposits at June 30, 2022 and December 31, 2021 were $ 83,000 16,000 |
INVESTMENT IN, AND NOTE RECEIVA
INVESTMENT IN, AND NOTE RECEIVABLE FROM MELT PHARMACEUTICALS, INC. - RELATED PARTY TRANSACTIONS | 6 Months Ended |
Jun. 30, 2022 | |
Investments, Debt and Equity Securities [Abstract] | |
INVESTMENT IN, AND NOTE RECEIVABLE FROM MELT PHARMACEUTICALS, INC. - RELATED PARTY TRANSACTIONS | NOTE 4. INVESTMENT IN, AND NOTE RECEIVABLE FROM MELT PHARMACEUTICALS, INC. - RELATED PARTY TRANSACTIONS In December 2018, the Company entered into an asset purchase agreement with Melt (the “Melt Asset Purchase Agreement”). Pursuant to the terms of the Melt Asset Purchase Agreement, Melt was assigned certain intellectual property and related rights from the Company to develop, formulate, make, sell, and sub-license certain Company conscious sedation and analgesia related formulations (collectively, the “Melt Products”). Under the terms of the Melt Asset Purchase Agreement, Melt is required to make mid-single digit royalty payments to the Company on net sales of the Melt Products while any patent rights remain outstanding, as well as other conditions. In February 2019, the Company and Melt entered into a Management Service Agreement between the Company and Melt (the “Melt MSA”), whereby the Company provides to Melt certain administrative services and support, including bookkeeping, web services and human resources related activities, and Melt is required to pay the Company a monthly amount of $ 10,000 During the three and six months ended June 30, 2022, the Company recorded $ 40,000 70,000 As of June 30, 2022 and December 31, 2021, the Company was due $ 109,000 48,000 The Company’s Chief Executive Officer, Mark L. Baum, was previously a member of the Melt board of directors until his resignation during the year ended December 31, 2021. Following Mr. Baum’s departure, the Company no longer has any representation on Melt’s board of directors. The unaudited condensed results of operations information of Melt is summarized below: SCHEDULE OF CONDENSED INCOME STATEMENT 2022 2021 For the Six Months Ended June 30, 2022 2021 Revenues, net $ - $ - Loss from operations (6,518,000 ) (2,177,000 ) Net loss $ (6,518,000 ) $ (2,177,000 ) The unaudited condensed balance sheet information of Melt is summarized below: SCHEDULE OF CONDENSED BALANCE SHEET At June 30, At December 31, 2022 2021 Current assets $ 6,197,000 $ 11,278,000 Non-current assets 773,000 - Total assets $ 6,970,000 $ 11,278,000 Total liabilities $ 17,662,000 $ 15,732,000 Total preferred stock and stockholders’ deficit (10,692,000 ) (4,454,000 ) Total liabilities and stockholders’ equity $ 6,970,000 $ 11,278,000 Melt Note Receivable On September 1, 2021, the Company entered into a loan and security agreement in the principal amount of $ 13,500,000 12.50 Melt has granted the Company a security interest in substantially all of its personal property, rights and assets, including intellectual property rights, to secure the payment of all amounts owed under the Melt Loan Agreement. The Melt Loan Agreement contains customary representations, warranties and covenants, including covenants by Melt limiting additional indebtedness, liens, mergers and acquisitions, dispositions, investments, distributions, subordinated debt, and transactions with affiliates. The Melt Loan Agreement includes customary events of default, and upon the occurrence of an event of default (subject to cure periods for certain events of default), all amounts owed by Melt thereunder may be declared immediately due and payable by the Company, and the interest rate on the loan may be increased by 3 15,000,000 In connection with the Melt Loan Agreement, the Company and Melt entered into a Right of First Refusal Agreement providing the Company with the right, but not the obligation, to match any offer received by Melt associated with the commercial rights to any of Melt’s drug candidates for a period of five years following the effective date of the Melt Loan Agreement. The net funds received by Melt excluded $ 908,000 |
INVESTMENT IN SURFACE OPHTHALMI
INVESTMENT IN SURFACE OPHTHALMICS, INC. - RELATED PARTY TRANSACTIONS | 6 Months Ended |
Jun. 30, 2022 | |
Investment In Surface Ophthalmics Inc. - Related Party Transactions | |
INVESTMENT IN SURFACE OPHTHALMICS, INC. - RELATED PARTY TRANSACTIONS | NOTE 5. INVESTMENT IN SURFACE OPHTHALMICS, INC. - RELATED PARTY TRANSACTIONS The Company entered into an asset purchase and license agreement with Surface in 2017 and amended it in April 2018 (the “Surface License Agreements”). Pursuant to the terms of the Surface License Agreements, the Company assigned and licensed to Surface certain intellectual property and related rights associated with Surface’s drug candidates (collectively, the “Surface Products”). Surface is required to make mid-single digit royalty payments to the Company on net sales of the Surface Products while any patent rights remain outstanding. As of June 30, 2022, the Company owned 3,500,000 The unaudited condensed results of operations information of Surface is summarized below: SUMMARY OF CONDENSED INCOME STATEMENT 2022 2021 For the Six Months Ended June 30, 2022 2021 Revenues, net $ - $ - Loss from operations (3,526,000 ) (4,712,000 ) Net loss $ (3,526,000 ) $ (4,712,000 ) The unaudited condensed balance sheet information of Surface is summarized below: SUMMARY OF CONDENSED BALANCE SHEET At June 30, At December 31, 2022 2021 Current assets $ 18,192,000 $ 21,731,000 Non-current assets 661,000 412,000 Total assets $ 18,853,000 $ 22,143,000 Total liabilities $ 1,624,000 $ 1,514,000 Total preferred stock and stockholders’ deficit 17,229,000 20,629,000 Total liabilities and stockholders’ equity $ 18,853,000 $ 22,143,000 |
INVENTORIES
INVENTORIES | 6 Months Ended |
Jun. 30, 2022 | |
Inventory Disclosure [Abstract] | |
INVENTORIES | NOTE 6. INVENTORIES Inventories are comprised of finished compounded formulations, over-the-counter and prescription retail pharmacy products, branded commercial pharmaceutical products, including those held at a 3PL, related laboratory supplies and active pharmaceutical ingredients. The composition of inventories as of June 30, 2022 and December 31, 2021 was as follows: SCHEDULE OF INVENTORIES June 30, December 31, Raw materials $ 3,217,000 $ 2,441,000 Work in progress 7,000 - Finished goods 1,908,000 1,776,000 Total inventories $ 5,132,000 $ 4,217,000 |
PREPAID EXPENSES AND OTHER CURR
PREPAID EXPENSES AND OTHER CURRENT ASSETS | 6 Months Ended |
Jun. 30, 2022 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
PREPAID EXPENSES AND OTHER CURRENT ASSETS | NOTE 7. PREPAID EXPENSES AND OTHER CURRENT ASSETS Prepaid expenses and other current assets at June 30, 2022 and December 31, 2021 consisted of the following: SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSETS June 30, December 31, Prepaid insurance $ 182,000 $ 728,000 Due from Melt Pharmaceuticals 109,000 48,000 Other prepaid expenses 821,000 437,000 Deposits and other current assets 73,000 92,000 Total prepaid expenses and other current assets $ 1,185,000 $ 1,305,000 |
PROPERTY, PLANT AND EQUIPMENT
PROPERTY, PLANT AND EQUIPMENT | 6 Months Ended |
Jun. 30, 2022 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY, PLANT AND EQUIPMENT | NOTE 8. PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment at June 30, 2022 and December 31, 2021 consisted of the following: SCHEDULE OF PROPERTY, PLANT AND EQUIPMENT June 30, December 31, Property, plant and equipment, net: Computer hardware $ 806,000 $ 772,000 Furniture and equipment 538,000 443,000 Lab and pharmacy equipment 4,195,000 4,056,000 Leasehold improvements 5,843,000 5,703,000 Property, plant and equipment, gross 11,382,000 10,974,000 Accumulated depreciation (8,590,000 ) (7,833,000 ) Property, plant and equipment, net $ 2,792,000 $ 3,141,000 For the three and six months ended June 30, 2022, depreciation related to the property, plant and equipment was $ 381,000 757,000 361,000 797,000 |
CAPITALIZED SOFTWARE DEVELOPMEN
CAPITALIZED SOFTWARE DEVELOPMENT COSTS | 6 Months Ended |
Jun. 30, 2022 | |
Capitalized Software Development Costs | |
CAPITALIZED SOFTWARE DEVELOPMENT COSTS | NOTE 9. CAPITALIZED SOFTWARE DEVELOPMENT COSTS Capitalized software development costs at June 30, 2022 and December 31, 2021 consisted of the following: SCHEDULE OF FINITE LIVED INTANGIBLE ASSETS June 30, December 31, Capitalized internal-use software development costs $ 942,000 $ 417,000 Acquired third-party software license for internal-use 159,000 684,000 Total gross capitalized software for internal-use 1,101,000 1,101,000 Accumulated amortization (655,000 ) (569,000 ) Capitalized internal-use software in process 1,312,000 781,000 Total finite lived intangible assets net $ 1,758,000 $ 1,313,000 The Company recorded amortization expense of $ 43,000 and $ 86,000 related to capitalized software development costs during the three and six months ended June 30, 2022, respectively, and $ 51,000 and $ 79,000 during the same periods in 2021, respectively. |
INTANGIBLE ASSETS AND GOODWILL
INTANGIBLE ASSETS AND GOODWILL | 6 Months Ended |
Jun. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS AND GOODWILL | NOTE 10. INTANGIBLE ASSETS AND GOODWILL The Company’s intangible assets at June 30, 2022 consisted of the following: SCHEDULE OF INTANGIBLE ASSETS Amortization Periods (in years) Cost Accumulated Amortization Impairment Net Carrying Value Patents 17 - 19 $ 971,000 $ (118,000 ) $ - $ 853,000 Licenses 20 100,000 (18,000 ) - 82,000 Trademarks Indefinite 260,000 - - 260,000 Acquired NDAs 10 13,635,000 (682,000 ) - 12,953,000 Customer relationships 3 - 15 1,519,000 (652,000 ) - 867,000 Trade name 5 5,000 (5,000 ) - - Non-competition clause 3 - 4 50,000 (50,000 ) - - State pharmacy licenses 25 8,000 (7,000 ) - 1,000 $ 16,548,000 $ (1,532,000 ) $ - $ 15,016,000 Amortization expense for intangible assets for the three and six months ended June 30, 2022 and 2021 was as follows: SCHEDULE OF AMORTIZATION EXPENSES FOR INTANGIBLE ASSETS 2022 2021 2022 2021 For the For the Three Months Ended Six Months Ended June 30, June 30, 2022 2021 2022 2021 Patents $ 21,000 $ 6,000 $ 43,000 $ 12,000 Licenses 3,000 - 11,000 1,000 Acquired NDAs 341,000 - 682,000 - Customer relationships 33,000 33,000 66,000 66,000 Amortization of intangible assets $ 398,000 $ 39,000 $ 802,000 $ 79,000 Estimated future amortization expense for the Company’s intangible assets at June 30, 2022 is as follows: SCHEDULE OF ESTIMATED FUTURE AMORTIZATION EXPENSE Remainder of 2022 $ 795,000 2023 1,592,000 2024 1,592,000 2025 1,592,000 2026 1,595,000 Thereafter 7,590,000 Intangible assets $ 14,756,000 |
ACCOUNTS PAYABLE AND ACCRUED EX
ACCOUNTS PAYABLE AND ACCRUED EXPENSES | 6 Months Ended |
Jun. 30, 2022 | |
Payables and Accruals [Abstract] | |
ACCOUNTS PAYABLE AND ACCRUED EXPENSES | NOTE 11. ACCOUNTS PAYABLE AND ACCRUED EXPENSES Accounts payable and accrued expenses at June 30, 2022 and December 31, 2021 consisted of the following: SCHEDULE OF ACCOUNTS PAYABLE AND ACCRUED EXPENSES June 30, December 31, Accounts payable $ 8,038,000 $ 5,174,000 Other accrued expenses 49,000 49,000 Accrued interest 1,114,000 1,114,000 Total accounts payable and accrued expenses $ 9,201,000 $ 6,337,000 |
DEBT
DEBT | 6 Months Ended |
Jun. 30, 2022 | |
Debt Disclosure [Abstract] | |
DEBT | NOTE 12. DEBT 8.625% Senior Notes Due 2026 In April 2021, the Company closed an offering of $ 50,000,000 aggregate principal amount of 8.625% senior notes due April 2026, and in May 2021 issued an additional $ 5,000,000 of such notes pursuant to the full exercise of the underwriters’ option to purchase additional notes (collectively, the “April Notes”). The April Notes were sold to investors at a par value of $ 25.00 per April Note and the offering resulted in net proceeds to the Company of approximately $ 51,909,000 after deducting underwriting discounts and commissions and expenses of $ 3,091,000 . In June 2021, in a further issuance of the April Notes, the Company sold an additional $ 20,000,000 aggregate principal amount of such notes (the “June Notes,” and together with the April Notes, the “Notes”), at a price of $ 25.75 per June Note, with interest of $ 278,000 on the June Notes being accrued from April 20, 2021 as of the date of issuance. The June offering resulted in net proceeds to the Company of approximately $ 19,164,000 after deducting underwriting discounts and commissions and expenses of $ 1,158,000 and a premium on note issuance of $ 322,000 . The June Notes are treated as a single series with the April Notes under the indenture governing the April Notes, dated as of April 20, 2021, and have the same terms as the April Notes (other than the initial offering price and issue date). T 8.625 % per annum. Interest on the Notes is payable quarterly in arrears on January 31, April 30, July 31 and October 31 of each year, commencing on July 31, 2021. The Notes will mature on April 30, 2026. The issuance costs were recorded as a debt discount and are being amortized as interest expense, net of the amortization of the premium on note issuance, over the term of the Notes using the effective interest rate method. Prior to February 1, 2026, the Company may, at its option, redeem the Notes, in whole at any time or in part from time to time, at a redemption price equal to 100% of the principal amount of the Notes to be redeemed , plus a make-whole amount, if any, plus accrued and unpaid interest to, but excluding, the date of redemption. The Company may redeem the Notes for cash in whole or in part at any time at our option on or after February 1, 2026 and prior to maturity, at a price equal to 100% of their principal amount, plus accrued and unpaid interest to, but excluding, the date of redemption. On and after any redemption date, interest will cease to accrue on the redeemed Notes. Interest expense related to the Notes totaled $ 1,812,000 and $ 3,622,000 for the three and six months ended June 30, 2022, respectively, and $ 1,466,000 during the three and six months ended June 30, 2021, and included amortization of debt issuance costs and discount of $ 195,000 and $ 388,000 for three and six months ended June 30, 2022, respectively, and $ 192,000 during the three and six months ended June 30, 2021. At June 30, 2022, future minimum payments under the Company’s debt were as follows: SUMMARY OF FUTURE MINIMUM PAYMENTS Amount Remainder of 2022 $ 3,234,000 2023 6,469,000 2024 6,469,000 2025 6,469,000 2026 77,158,000 Total minimum payments 99,799,000 Less: amount representing interest payments (24,799,000 ) Notes payable, gross 75,000,000 Less: unamortized discount, net of premium (2,958,000 ) Notes payable, net of unamortized discount $ 72,042,000 |
LEASES
LEASES | 6 Months Ended |
Jun. 30, 2022 | |
Leases | |
LEASES | NOTE 13. LEASES The Company leases office and laboratory space under non-cancelable operating leases listed below. These lease agreements have remaining terms between one to five years and contain various clauses for renewal at the Company’s option. ● An operating lease for 5,789 square feet of office space in Carlsbad, California, which commenced in January 2022 and will expire in July 2027 . ● An operating lease for 35,326 square feet of lab, warehouse and office space in Ledgewood, New Jersey that expires in July 2026 , with an option to extend the term for two additional five-year periods. This includes an amendment, which was made effective July 2020, that extended the term of the original lease and added 1,400 of additional square footage to the lease, and another amendment entered into in May 2021 that extended the term of the lease to July 2027 and added 8,900 square feet of space. ● An operating lease for 5,500 square feet of office space in Nashville, Tennessee that expires in December 2024 , with an option to extend the term for two additional five-year periods . ● An operating lease for 11,552 square feet of lab and office space in Nashville, Tennessee which commenced in June 2022 and will expire in June 2027 . At June 30, 2022, the weighted average incremental borrowing rate and the weighted average remaining lease term for the operating leases held by the Company were 6.61 % and 11.21 years, respectively. During the three and six months ended June 30, 2022, cash paid for amounts included for the operating lease liabilities was $ 207,000 and $ 373,000 , respectively, and $ 251,000 and $ 502,000 during the same periods in 2021, respectively. During the three and six months ended June 30, 2022, the Company recorded operating lease expense of $ 262,000 and $ 500,000 , respectively, which is included in selling, general and administrative expenses. Future lease payments under operating leases as of June 30, 2022 were as follows : SCHEDULE OF FUTURE LEASE PAYMENT UNDER OPERATING LEASES Operating Leases Remainder of 2022 $ 569,000 2023 1,231,000 2024 1,262,000 2025 1,093,000 2026 1,114,000 Thereafter 6,801,000 Total minimum lease payments 12,070,000 Less: amount representing interest payments (3,733,000 ) Total operating lease liabilities 8,337,000 Less: current portion, operating lease liabilities (633,000 ) Operating lease liabilities, net of current portion $ 7,704,000 During the six months ended June 30, 2022, the Company paid all amounts owed under its finance lease and no future payments are due related to finance leases. |
STOCKHOLDERS_ EQUITY AND STOCK-
STOCKHOLDERS’ EQUITY AND STOCK-BASED COMPENSATION | 6 Months Ended |
Jun. 30, 2022 | |
Equity [Abstract] | |
STOCKHOLDERS’ EQUITY AND STOCK-BASED COMPENSATION | NOTE 14. STOCKHOLDERS’ EQUITY AND STOCK-BASED COMPENSATION Preferred Stock At June 30, 2022 and December 31, 2021, the Company had 5,000,000 0.001 no Common Stock During the six months ended June 30, 2022, the Company issued 53,594 125,000 2.40 36,014 35,392 295,000 During the six months ended June 30, 2022, the Company issued 3,000 7,000 3,000 1.70 3.95 During the six months ended June 30, 2022, 50,000 29,395 20,605 162,000 During the six months ended June 30, 2022, 50,000 24,077 25,923 204,000 During the six months ended June 30, 2022, 35,000 20,298 14,702 116,000 During the six months ended June 30, 2022, 50,000 36,851 13,149 99,000 During the six months ended June 30, 2022, 19,288 Stock Option Plan On September 17, 2007, the Company’s Board of Directors and stockholders adopted the Company’s 2007 Incentive Stock and Awards Plan, which was subsequently amended on November 5, 2008, February 26, 2012, July 18, 2012, May 2, 2013 and September 27, 2013 (as amended, the “2007 Plan”). The 2007 Plan reached its term in September 2017, and we can no longer issue additional awards under this plan; however, options previously issued under the 2007 Plan will remain outstanding until they are exercised, reach their maturity or are otherwise cancelled/forfeited. On June 13, 2017, the Company’s Board of Directors and stockholders adopted the Company’s 2017 Incentive Stock and Awards Plan which was subsequently amended on June 3, 2021 (as amended, the “2017 Plan” together with the 2007 Plan, the “Plans”). As of June 30, 2022, the 2017 Plan provides for the issuance of a maximum of 6,000,000 2,067,284 Stock Options A summary of stock option activity under the Plans for the six months ended June 30, 2022 is as follows: SCHEDULE OF STOCK OPTION PLAN ACTIVITY Number of Shares Weighted Weighted Average Remaining Contractual Life Aggregate Intrinsic Value Options outstanding – January 1, 2022 3,039,546 $ 5.52 Options granted 281,250 $ 7.38 Options exercised (128,000 ) $ 2.45 Options cancelled/forfeited (14,500 ) $ 7.60 Options outstanding – June 30, 2022 3,178,296 $ 5.80 4.92 $ 5,539,000 Options exercisable 2,444,993 $ 5.32 4.42 $ 5,366,000 Options vested and expected to vest 3,178,296 $ 5.80 4.92 $ 5,539,000 The aggregate intrinsic value in the table above represents the total pre-tax amount of the proceeds, net of exercise price, which would have been received by option holders if all option holders had exercised and immediately sold all shares underlying options with an exercise price lower than the market price on June 30, 2022, based on the closing price of the Company’s common stock of $ 7.28 During the six months ended June 30, 2022, the Company granted stock options to certain employees. The stock options were granted with an exercise price equal to the current market price of the Company’s common stock, as reported by the securities exchange on which the common stock was then listed, at the grant date and have contractual terms of ten years vesting schedule: 25% of the shares subject to the option vest and become exercisable on the first anniversary of the grant date and the remaining 75% of the shares subject to the option vest and become exercisable quarterly in equal installments thereafter over three years. Certain option awards provide for accelerated vesting if there is a change in control (as defined in the Plans) and in the event of certain modifications to the option award agreement The fair value of each option award is estimated on the date of grant using the Black-Scholes-Merton option pricing model. The expected term of options granted to employees and directors was determined in accordance with the “simplified approach,” as the Company has limited, relevant, historical data on employee exercises and post-vesting employment termination behavior. The expected risk-free interest rate is based on the U.S. Treasury yield for a period consistent with the expected term of the option in effect at the time of the grant. The financial statement effect of forfeitures is estimated at the time of grant and revised, if necessary, if the actual effect differs from those estimates. For option grants to employees and directors, the Company assigns a forfeiture factor of 10%. These factors could change in the future, which would affect the determination of stock-based compensation expense in future periods. Utilizing these assumptions, the fair value is determined at the date of grant. The table below illustrates the fair value per share determined using the Black-Scholes-Merton option pricing model with the following assumptions used for valuing options granted to employees: SCHEDULE OF FAIR VALUE ASSUMPTIONS 2022 Weighted-average fair value of options granted $ 4.54 Expected terms (in years) 6.11 Expected volatility 68 70 % Risk-free interest rate 1.54 2.78 % Dividend yield - The following table summarizes information about stock options outstanding and exercisable at June 30, 2022: SCHEDULE OF STOCK OPTION OUTSTANDING AND EXERCISABLE Options Outstanding Options Exercisable Range of Exercise Prices Number Outstanding Weighted Average Remaining Contractual Life in Years Weighted Number Weighted $ 1.47 2.23 595,887 5.04 $ 1.97 595,887 $ 1.97 $ 2.40 3.50 53,568 6.05 $ 3.00 42,507 $ 2.88 $ 3.95 370,000 3.75 $ 3.95 370,000 $ 3.95 $ 4.08 6.30 578,850 5.47 $ 5.76 534,605 $ 5.83 $ 6.80 7.30 409,995 7.81 $ 7.21 230,370 $ 7.27 $ 7.37 7.79 297,323 6.34 $ 7.54 139,699 $ 7.47 $ 7.87 600,000 3.08 $ 7.87 300,000 $ 7.87 $ 7.89 8.75 82,673 7.06 $ 8.06 48,800 $ 8.16 $ 8.98 10,000 8.59 $ 8.98 3,125 $ 8.98 $ 8.99 180,000 0.84 $ 8.99 180,000 $ 8.99 $ 1.47 8.99 3,178,296 4.92 $ 5.80 2,444,993 $ 5.32 As of June 30, 2022, there was approximately $ 2,013,000 3.15 258,000 530,000 569,000 1,021,000 The intrinsic value of options exercised during the six months ended June 30, 2022 was $ 754,000 Restricted Stock Units/Performance Stock Units RSU awards are granted subject to certain vesting requirements and other restrictions, including performance and market-based vesting criteria. The grant date fair value of the RSUs, which has been determined based upon the market value of the Company’s common stock on the grant date, is expensed over the vesting period of the RSUs. A summary of the Company’s RSU activity (including performance stock units) and related information for the six months ended June 30, 2022 is as follows: SCHEDULE OF RESTRICTED STOCK UNITS ACTIVITY Number of RSUs Weighted Average Grant Date Fair Value RSUs unvested - January 1, 2022 2,233,202 $ 6.78 RSUs granted 65,615 $ 7.62 RSUs vested (204,288 ) $ 6.52 RSUs cancelled/forfeited - - RSUs unvested - June 30, 2022 2,094,529 $ 6.83 As of June 30, 2022, the total unrecognized compensation expense related to unvested RSUs was approximately $ 8,819,000 1.10 1,735,000 3,479,000 481,000 827,000 Warrants From time to time, the Company has issued warrants to purchase shares of the Company’s common stock to investors, lenders, underwriters and other non-employees for services rendered or to be rendered in the future, or pursuant to settlement agreements. A summary of warrant activity for the six months ended June 30, 2022 is as follows: SCHEDULE OF WARRANTS ACTIVITY Number of Shares Subject to Warrants Outstanding Weighted Average Exercise Price Warrants outstanding– January 1, 2022 373,847 $ 2.08 Granted - Exercised - Expired - Warrants outstanding and exercisable – June 30, 2022 373,847 $ 2.08 Weighted average remaining contractual life of the outstanding warrants in years – June 30, 2022 2.1 Warrants outstanding and exercisable as of June 30, 2022 are as follows: SCHEDULE OF WARRANTS OUTSTANDING AND WARRANTS EXERCISABLE Warrant Series Issue Date Warrants Outstanding Exercise Price Expiration Date Lender warrants 7/19/2017 373,847 $ 2.08 7/19/2024 Subsidiary Stock-Based Transactions The Company recognized $ 0 28,000 85,000 Stock-Based Compensation Summary The Company recorded stock-based compensation related to equity instruments granted to employees, directors and consultants as follows: SCHEDULE OF STOCK BASED COMPENSATION GRANTED TO EMPLOYEES DIRECTORS CONSULTANTS 2022 2021 2022 2021 For the Three Months Ended June 30, For the Six Months Ended June 30, 2022 2021 2022 2021 Employees – selling, general and administrative $ 1,655,000 $ 923,000 $ 3,331,000 $ 1,678,000 Employees – R&D 176,000 55,000 362,000 55,000 Directors – selling, general and administrative 112,000 100,000 212,000 200,000 Consultants – R&D 50,000 - 104,000 - Total $ 1,993,000 $ 1,078,000 $ 4,009,000 $ 1,933,000 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Jun. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 15. COMMITMENTS AND CONTINGENCIES Legal General and Other In the ordinary course of business, the Company may face various claims brought by third parties and it may, from time to time, make claims or take legal actions to assert its rights, including intellectual property disputes, contractual disputes and other commercial disputes. Any of these claims could subject the Company to litigation. Product and Professional Liability Product and professional liability litigation represents an inherent risk to all firms in the pharmaceutical and pharmacy industry. We utilize traditional third-party insurance policies with regard to our product and professional liability claims. Such insurance coverage at any given time reflects current market conditions, including cost and availability, when the policy is written. Indemnities In addition to the indemnification provisions contained in the Company’s governing documents, the Company generally enters into separate indemnification agreements with each of the Company’s directors and officers. These agreements require the Company, among other things, to indemnify the director or officer against specified expenses and liabilities, such as attorneys’ fees, judgments, fines and settlements, paid by the individual in connection with any action, suit or proceeding arising out of the individual’s status or service as the Company’s director or officer, other than liabilities arising from willful misconduct or conduct that is knowingly fraudulent or deliberately dishonest, and to advance expenses incurred by the individual in connection with any proceeding against the individual with respect to which the individual may be entitled to indemnification by the Company. The Company also indemnifies its lessors in connection with its facility leases for certain claims arising from the use of the facilities. These indemnities do not provide for any limitation of the maximum potential future payments the Company could be obligated to make. Historically, the Company has not incurred any payments for these obligations and, therefore, no liabilities have been recorded for these indemnities in the accompanying condensed consolidated balance sheets. Klarity License Agreement – Related Party The Company entered into a license agreement in April 2017, as amended in April 2018 (the “Klarity License Agreement”), with Richard L. Lindstrom, M.D., a member of its Board of Directors. Pursuant to the terms of the Klarity License Agreement, the Company licensed certain intellectual property and related rights from Dr. Lindstrom to develop, formulate, make, sell, and sub-license the topical ophthalmic solution Klarity designed to protect and rehabilitate the ocular surface (the “Klarity Product”). Under the terms of the Klarity License Agreement, the Company is required to make royalty payments to Dr. Lindstrom ranging from 3% to 6% of net sales, dependent upon the final formulation of the Klarity Product sold 92,000 122,000 35,000 70,000 106,000 177,000 44,000 79,000 Injectable Asset Purchase Agreement – Related Party In December 2019, the Company entered into an asset purchase agreement (the “Lindstrom APA”) with Dr. Lindstrom, a member of its Board of Directors. Pursuant to the terms of the Lindstrom APA, the Company acquired certain intellectual property and related rights from Dr. Lindstrom to develop, formulate, make, sell, and sub-license an ophthalmic injectable product (the “Lindstrom Product”). Under the terms of the Lindstrom APA, the Company is required to make royalty payments to Dr. Lindstrom ranging from 2% to 3% of net sales, dependent upon the final formulation and patent protection of the Lindstrom Product sold 33,000 7,000 15,000 7,000 14,000 8,000 15,000 7,000 14,000 Eyepoint Commercial Alliance Agreement In August 2020, the Company, through its wholly owned subsidiary ImprimisRx, LLC, entered into a Commercial Alliance Agreement (the “Dexycu Agreement”) with Eyepoint Pharmaceuticals, Inc. (“Eyepoint”), pursuant to which Eyepoint granted the Company the non-exclusive right to co-promote DEXYCU ® Pursuant to the Dexycu Agreement Dexycu Agreement The Dexycu Agreement August 1, 2025 Dexycu Agreement, subject to specified notice periods and limitations, Dexycu Agreement Dexycu Agreement 1,212,000 2,532,000 827,000 1,312,000 Sales and Marketing Agreements The Company has entered various sales and marketing agreements with certain organizations to provide exclusive and non-exclusive sales and marketing representation services to Harrow in select geographies in the U.S. in connection with the Company’s ophthalmic pharmaceutical compounded formulations or related products. Under the terms of the sales and marketing agreements, the Company is generally required to make commission payments equal to 10 14 1,100,000 2,147,000 1,032,000 1,836,000 Asset Purchase, License and Related Agreements The Company has acquired and sourced intellectual property rights related to certain proprietary innovations from certain inventors and related parties (the “Inventors”) through multiple asset purchase agreements, license agreements, strategic agreements and commission agreements. In general, these agreements provide that the Inventors will cooperate with the Company in obtaining patent protection for the acquired intellectual property and that the Company will use commercially reasonable efforts to research, develop and commercialize a product based on the acquired intellectual property. In addition, the Company has acquired a right of first refusal on additional intellectual property and drug development opportunities presented by these Inventors. In consideration for the acquisition of the intellectual property rights, the Company is obligated to make payments to the Inventors based on the completion of certain milestones, generally consisting of: (1) a payment payable within 30 days after the issuance of the first patent in the United States arising from the acquired intellectual property (if any); (2) a payment payable within 30 days after the Company files the first investigational new drug application (“IND”) with the U.S. Food and Drug Administration (“FDA”) for the first product arising from the acquired intellectual property (if any); (3) for certain of the Inventors, a payment payable within 30 days after the Company files the first new drug application with the FDA for the first product arising from the acquired intellectual property (if any); and (4) certain royalty payments based on the net receipts received by the Company in connection with the sale or licensing of any product based on the acquired intellectual property (if any), after deducting (among other things) the Company’s development costs associated with such product. If, following five years after the date of the applicable asset purchase agreement, the Company either (a) for certain of the Inventors, has not filed an IND or, for the remaining Inventors, has not initiated a study where data is derived, or (b) has failed to generate royalty payments to the Inventors for any product based on the acquired intellectual property, the Inventors may terminate the applicable asset purchase agreement and request that the Company re-assign the acquired technology to the Inventors. During the three and six months ended June 30, 2022, $ 297,000 510,000 261,000 493,000 Sintetica Agreement In July 2021, the Company entered into a License and Supply Agreement (the “Sintetica Agreement”) with Sintetica S.A. (“Sintetica”), pursuant to which Sintetica granted the Company the exclusive license and marketing rights to its patented ophthalmic drug candidate (“AMP-100”) in the U.S. and Canada. Pursuant to the Sintetica Agreement, the Company will pay Sintetica a per unit transfer price to supply AMP-100, along with a per unit royalty for units sold. The Company is required to pay Sintetica up to $ 18,000,000 5,000,000 3,117,000 Subject to certain limitations, the Sintetica Agreement has a ten year term, and allows for a ten-year extension if certain sales thresholds are met. Wakamoto Agreement In August 2021, the Company entered into a License Agreement and a Basic Sale and Purchase Agreement (together, the “Wakamoto Agreements”) with Wakamoto Pharmaceutical Co., Ltd. (“Wakamoto”), pursuant to which Wakamoto granted the Company the exclusive license and marketing rights to its ophthalmic drug candidate (“MAQ-100”) in the U.S. and Canada. Pursuant to the Wakamoto 2,000,000 6,200,000 Subject to certain limitations, the term of the Agreements is for five years from the date of the FDA’s market approval of MAQ-100 and allows for a five-year extension if certain unit sales thresholds are met. Presbyopia Asset Purchase Agreement – Related Party In December 2019, the Company entered into an asset purchase agreement (the “Presbyopia APA”) with Richard L. Lindstrom, M.D., a member of its Board of Directors. Pursuant to the terms of the Presbyopia APA, the Company acquired certain intellectual property and related rights from Dr. Lindstrom to develop, formulate, make, sell, and sub-license an ophthalmic topical product to treat presbyopia (the “Presbyopia Product”). Under the terms of the Presbyopia Product, the Company is required to make royalty payments to Dr. Lindstrom ranging from 2% to 4% of net sales, dependent upon the final formulation and patent protection of the Presbyopia Product sold 0 0 0 |
CONCENTRATIONS
CONCENTRATIONS | 6 Months Ended |
Jun. 30, 2022 | |
Risks and Uncertainties [Abstract] | |
CONCENTRATIONS | NOTE 16. CONCENTRATIONS The Company has two products that each comprised more than 10% of total revenues during the three and six month periods ended June 30. These products collectively accounted for 32 32 36 36 The Company sells its compounded formulations to a large number of customers. There were no customers who comprised more than 10% of the Company’s total pharmacy sales during the three and six months ended June 30, 2022 and 2021. The Company receives its active pharmaceutical ingredients from three main suppliers. These suppliers collectively accounted for 72 73 85 79 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 6 Months Ended |
Jun. 30, 2022 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 17. SUBSEQUENT EVENTS The Company has performed an evaluation of events occurring subsequent to June 30, 2022 through the filing date of this Quarterly Report. Based on its evaluation, no events other than those described below need to be disclosed. In July 2022, the Center for Medicare & Medicaid Services (“CMS”) published in the Federal Register the calendar year (CY) 2023 Medicare Hospital Outpatient Prospective Payment System (“OPPS”) and ASC Payment System Proposed Rule (“Proposed Rule”). If the Proposed Rule is finalized, in the relevant part, without changes, it would result in loss of pass-through related separate payment for Dexycu, when furnished in hospital outpatient department settings reimbursed by Medicare. This would reduce the amount of Medicare reimbursement provided to the Dexycu customers and, if finalized without changes, result in a significant reduction in the Company’s Dexycu commission revenues. A Final Rule is expected to be issued in early November 2022. In the Final Rule, CMS may adopt or modify the Proposed Rule’s proposals related to Dexycu. If the Proposed Rule’s proposals related to Dexycu are finalized, they would be effective on January 1, 2023. If adopted as currently proposed, the Company does not expect the Proposed Rule to have a material impact on its operations, financial statements and cash flows. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jun. 30, 2022 | |
Accounting Policies [Abstract] | |
Risks, Uncertainties and Liquidity | Risks, Uncertainties and Liquidity The Company is subject to certain regulatory standards, approvals, guidelines and inspections which could impact the Company’s ability to make, dispense, and sell certain products. If the Company was required to cease compounding and selling certain products as a result of regulatory guidelines or inspections, this may have a material impact on the Company’s financial condition, liquidity and results of operations. |
Segments | Segments Due to shifts in the Company’s strategic plans to further focus on growing the Company’s ImprimisRx business and suspension of activities related to starting up development-stage pharmaceutical companies, along with changes to the Company’s organizational and internal reporting structure, beginning in January 2022 management no longer evaluates the Company’s business in two segments and instead focuses on the performance of the business as a single operating business. |
Basic and Diluted Net Loss per Common Share | Basic and Diluted Net Loss per Common Share Basic net loss per common share is computed by dividing net loss attributable to common stockholders for the period by the weighted average number of common shares outstanding during the period. Diluted net loss per share is computed by dividing the net loss attributable to common stockholders for the period by the weighted average number of common and common equivalent shares, such as stock options, restricted stock units (“RSUs”) and warrants, outstanding during the period. Common equivalent shares (using the treasury stock method) from stock options, unvested RSUs and warrants were 5,646,672 4,121,398 287,049 235,973 The following table shows the computation of basic net loss per share of common stock for the three and six months ended June 30, 2022 and 2021: SCHEDULE OF BASIC AND DILUTED EARNINGS PER COMMON SHARE June 30, 2022 June 30, 2021 June 30, 2022 June 30, 2021 For the For the Three Months Ended Six Months Ended June 30, 2022 June 30, 2021 June 30, 2022 June 30, 2021 Numerator – net loss attributable to common stockholders $ (6,239,000 ) $ (2,950,000 ) $ (8,677,000 ) $ (2,733,000 ) Denominator – weighted average number of shares outstanding, basic and diluted 27,303,458 26,736,970 27,265,350 26,379,943 Denominator – weighted average number of shares outstanding, basic and diluted 27,303,458 26,736,970 27,265,350 26,379,943 Net loss per share of common stock, basic and diluted $ (0.23 ) $ (0.11 ) $ (0.32 ) $ (0.10 ) |
Investment in Eton Pharmaceuticals, Inc | Investment in Eton Pharmaceuticals, Inc As of June 30, 2022, the Company owned 1,982,000 10 2.62 Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities 3,449,000 3,310,000 3,584,000 6,419,000 5,193,000 |
Investment in Melt Pharmaceuticals, Inc. – Related Party | Investment in Melt Pharmaceuticals, Inc. – Related Party The Company owns 3,500,000 46 0 100 0 100 The following table summarizes the Company’s investments in Melt as of June 30, 2022: SCHEDULE OF INVESTMENT Share of Equity Method Paid-in -Kind In-substance Capital Net Cost Basis Losses Interest Contributions Carrying value Common stock $ 5,810,000 $ (5,810,000 ) $ - $ - $ - Loan 13,500,000 (7,899,000 ) 1,484,000 (1,484,000 ) 5,601,000 $ 19,310,000 $ (13,709,000 ) $ 1,484,000 $ (1,484,000 ) $ 5,601,000 See Note 4 for more information and related party disclosure regarding Melt. |
Investment in Surface Ophthalmics, Inc. – Related Party | Investment in Surface Ophthalmics, Inc. – Related Party The Company owns 3,500,000 20 0 The following table summarizes the Company’s investment in Surface as of June 30, 2022: SCHEDULE OF INVESTMENT Cost Share of Equity Net Basis Method Losses Carrying value Common stock $ 5,320,000 $ (5,320,000 ) $ - See Note 5 for more information and related party disclosure regarding Surface. |
Impairment of Equity Method Investments and Note Receivable | Impairment of Equity Method Investments and Note Receivable On a quarterly basis, management assesses whether there are any indicators that the carrying value of the Company’s equity method investments and note receivable may be other than temporarily impaired. Indicators include financial condition, operating performance, and near-term prospects of the investee. To the extent indicators suggest that a loss in value may have occurred, the Company will evaluate both quantitative and qualitative factors to determine if the loss in value is other than temporary. If a potential loss in value is determined to be other than temporary, the Company will recognize an impairment loss based on the estimated fair value of the equity method investments and note receivable. At June 30, 2022 and December 31, 2021, no indicators of impairment existed. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
SCHEDULE OF BASIC AND DILUTED EARNINGS PER COMMON SHARE | The following table shows the computation of basic net loss per share of common stock for the three and six months ended June 30, 2022 and 2021: SCHEDULE OF BASIC AND DILUTED EARNINGS PER COMMON SHARE June 30, 2022 June 30, 2021 June 30, 2022 June 30, 2021 For the For the Three Months Ended Six Months Ended June 30, 2022 June 30, 2021 June 30, 2022 June 30, 2021 Numerator – net loss attributable to common stockholders $ (6,239,000 ) $ (2,950,000 ) $ (8,677,000 ) $ (2,733,000 ) Denominator – weighted average number of shares outstanding, basic and diluted 27,303,458 26,736,970 27,265,350 26,379,943 Denominator – weighted average number of shares outstanding, basic and diluted 27,303,458 26,736,970 27,265,350 26,379,943 Net loss per share of common stock, basic and diluted $ (0.23 ) $ (0.11 ) $ (0.32 ) $ (0.10 ) |
Melt Pharmaceuticals, Inc. [Member] | |
SCHEDULE OF INVESTMENT | The following table summarizes the Company’s investments in Melt as of June 30, 2022: SCHEDULE OF INVESTMENT Share of Equity Method Paid-in -Kind In-substance Capital Net Cost Basis Losses Interest Contributions Carrying value Common stock $ 5,810,000 $ (5,810,000 ) $ - $ - $ - Loan 13,500,000 (7,899,000 ) 1,484,000 (1,484,000 ) 5,601,000 $ 19,310,000 $ (13,709,000 ) $ 1,484,000 $ (1,484,000 ) $ 5,601,000 |
Surface Ophthalmics, Inc. [Member] | |
SCHEDULE OF INVESTMENT | The following table summarizes the Company’s investment in Surface as of June 30, 2022: SCHEDULE OF INVESTMENT Cost Share of Equity Net Basis Method Losses Carrying value Common stock $ 5,320,000 $ (5,320,000 ) $ - |
REVENUES (Tables)
REVENUES (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
SCHEDULE OF DISAGGREGATED REVENUE | Revenue disaggregated by revenue source for the three and six months ended June 30, 2022 and 2021 consists of the following: SCHEDULE OF DISAGGREGATED REVENUE 2022 2021 2022 2021 For the Three Months Ended For the Six Months Ended June 30, June 30, 2022 2021 2022 2021 Product sales, net $ 21,518,000 $ 17,297,000 $ 41,858,000 $ 32,245,000 Commission revenues 1,212,000 827,000 2,532,000 1,312,000 Transfer of profits 593,000 - 1,053,000 - License revenues - 10,000 - 20,000 Total revenues $ 23,323,000 $ 18,134,000 $ 45,443,000 $ 33,577,000 |
INVESTMENT IN, AND NOTE RECEI_2
INVESTMENT IN, AND NOTE RECEIVABLE FROM MELT PHARMACEUTICALS, INC. - RELATED PARTY TRANSACTIONS (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Investments, Debt and Equity Securities [Abstract] | |
SCHEDULE OF CONDENSED INCOME STATEMENT | The unaudited condensed results of operations information of Melt is summarized below: SCHEDULE OF CONDENSED INCOME STATEMENT 2022 2021 For the Six Months Ended June 30, 2022 2021 Revenues, net $ - $ - Loss from operations (6,518,000 ) (2,177,000 ) Net loss $ (6,518,000 ) $ (2,177,000 ) |
SCHEDULE OF CONDENSED BALANCE SHEET | The unaudited condensed balance sheet information of Melt is summarized below: SCHEDULE OF CONDENSED BALANCE SHEET At June 30, At December 31, 2022 2021 Current assets $ 6,197,000 $ 11,278,000 Non-current assets 773,000 - Total assets $ 6,970,000 $ 11,278,000 Total liabilities $ 17,662,000 $ 15,732,000 Total preferred stock and stockholders’ deficit (10,692,000 ) (4,454,000 ) Total liabilities and stockholders’ equity $ 6,970,000 $ 11,278,000 |
INVESTMENT IN SURFACE OPHTHAL_2
INVESTMENT IN SURFACE OPHTHALMICS, INC. - RELATED PARTY TRANSACTIONS (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Investment In Surface Ophthalmics Inc. - Related Party Transactions | |
SUMMARY OF CONDENSED INCOME STATEMENT | The unaudited condensed results of operations information of Surface is summarized below: SUMMARY OF CONDENSED INCOME STATEMENT 2022 2021 For the Six Months Ended June 30, 2022 2021 Revenues, net $ - $ - Loss from operations (3,526,000 ) (4,712,000 ) Net loss $ (3,526,000 ) $ (4,712,000 ) |
SUMMARY OF CONDENSED BALANCE SHEET | The unaudited condensed balance sheet information of Surface is summarized below: SUMMARY OF CONDENSED BALANCE SHEET At June 30, At December 31, 2022 2021 Current assets $ 18,192,000 $ 21,731,000 Non-current assets 661,000 412,000 Total assets $ 18,853,000 $ 22,143,000 Total liabilities $ 1,624,000 $ 1,514,000 Total preferred stock and stockholders’ deficit 17,229,000 20,629,000 Total liabilities and stockholders’ equity $ 18,853,000 $ 22,143,000 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Inventory Disclosure [Abstract] | |
SCHEDULE OF INVENTORIES | Inventories are comprised of finished compounded formulations, over-the-counter and prescription retail pharmacy products, branded commercial pharmaceutical products, including those held at a 3PL, related laboratory supplies and active pharmaceutical ingredients. The composition of inventories as of June 30, 2022 and December 31, 2021 was as follows: SCHEDULE OF INVENTORIES June 30, December 31, Raw materials $ 3,217,000 $ 2,441,000 Work in progress 7,000 - Finished goods 1,908,000 1,776,000 Total inventories $ 5,132,000 $ 4,217,000 |
PREPAID EXPENSES AND OTHER CU_2
PREPAID EXPENSES AND OTHER CURRENT ASSETS (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSETS | Prepaid expenses and other current assets at June 30, 2022 and December 31, 2021 consisted of the following: SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSETS June 30, December 31, Prepaid insurance $ 182,000 $ 728,000 Due from Melt Pharmaceuticals 109,000 48,000 Other prepaid expenses 821,000 437,000 Deposits and other current assets 73,000 92,000 Total prepaid expenses and other current assets $ 1,185,000 $ 1,305,000 |
PROPERTY, PLANT AND EQUIPMENT (
PROPERTY, PLANT AND EQUIPMENT (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Property, Plant and Equipment [Abstract] | |
SCHEDULE OF PROPERTY, PLANT AND EQUIPMENT | Property, plant and equipment at June 30, 2022 and December 31, 2021 consisted of the following: SCHEDULE OF PROPERTY, PLANT AND EQUIPMENT June 30, December 31, Property, plant and equipment, net: Computer hardware $ 806,000 $ 772,000 Furniture and equipment 538,000 443,000 Lab and pharmacy equipment 4,195,000 4,056,000 Leasehold improvements 5,843,000 5,703,000 Property, plant and equipment, gross 11,382,000 10,974,000 Accumulated depreciation (8,590,000 ) (7,833,000 ) Property, plant and equipment, net $ 2,792,000 $ 3,141,000 |
CAPITALIZED SOFTWARE DEVELOPM_2
CAPITALIZED SOFTWARE DEVELOPMENT COSTS (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Capitalized Software Development Costs | |
SCHEDULE OF FINITE LIVED INTANGIBLE ASSETS | Capitalized software development costs at June 30, 2022 and December 31, 2021 consisted of the following: SCHEDULE OF FINITE LIVED INTANGIBLE ASSETS June 30, December 31, Capitalized internal-use software development costs $ 942,000 $ 417,000 Acquired third-party software license for internal-use 159,000 684,000 Total gross capitalized software for internal-use 1,101,000 1,101,000 Accumulated amortization (655,000 ) (569,000 ) Capitalized internal-use software in process 1,312,000 781,000 Total finite lived intangible assets net $ 1,758,000 $ 1,313,000 |
INTANGIBLE ASSETS AND GOODWILL
INTANGIBLE ASSETS AND GOODWILL (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
SCHEDULE OF INTANGIBLE ASSETS | The Company’s intangible assets at June 30, 2022 consisted of the following: SCHEDULE OF INTANGIBLE ASSETS Amortization Periods (in years) Cost Accumulated Amortization Impairment Net Carrying Value Patents 17 - 19 $ 971,000 $ (118,000 ) $ - $ 853,000 Licenses 20 100,000 (18,000 ) - 82,000 Trademarks Indefinite 260,000 - - 260,000 Acquired NDAs 10 13,635,000 (682,000 ) - 12,953,000 Customer relationships 3 - 15 1,519,000 (652,000 ) - 867,000 Trade name 5 5,000 (5,000 ) - - Non-competition clause 3 - 4 50,000 (50,000 ) - - State pharmacy licenses 25 8,000 (7,000 ) - 1,000 $ 16,548,000 $ (1,532,000 ) $ - $ 15,016,000 |
SCHEDULE OF AMORTIZATION EXPENSES FOR INTANGIBLE ASSETS | Amortization expense for intangible assets for the three and six months ended June 30, 2022 and 2021 was as follows: SCHEDULE OF AMORTIZATION EXPENSES FOR INTANGIBLE ASSETS 2022 2021 2022 2021 For the For the Three Months Ended Six Months Ended June 30, June 30, 2022 2021 2022 2021 Patents $ 21,000 $ 6,000 $ 43,000 $ 12,000 Licenses 3,000 - 11,000 1,000 Acquired NDAs 341,000 - 682,000 - Customer relationships 33,000 33,000 66,000 66,000 Amortization of intangible assets $ 398,000 $ 39,000 $ 802,000 $ 79,000 |
SCHEDULE OF ESTIMATED FUTURE AMORTIZATION EXPENSE | Estimated future amortization expense for the Company’s intangible assets at June 30, 2022 is as follows: SCHEDULE OF ESTIMATED FUTURE AMORTIZATION EXPENSE Remainder of 2022 $ 795,000 2023 1,592,000 2024 1,592,000 2025 1,592,000 2026 1,595,000 Thereafter 7,590,000 Intangible assets $ 14,756,000 |
ACCOUNTS PAYABLE AND ACCRUED _2
ACCOUNTS PAYABLE AND ACCRUED EXPENSES (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Payables and Accruals [Abstract] | |
SCHEDULE OF ACCOUNTS PAYABLE AND ACCRUED EXPENSES | Accounts payable and accrued expenses at June 30, 2022 and December 31, 2021 consisted of the following: SCHEDULE OF ACCOUNTS PAYABLE AND ACCRUED EXPENSES June 30, December 31, Accounts payable $ 8,038,000 $ 5,174,000 Other accrued expenses 49,000 49,000 Accrued interest 1,114,000 1,114,000 Total accounts payable and accrued expenses $ 9,201,000 $ 6,337,000 |
DEBT (Tables)
DEBT (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Debt Disclosure [Abstract] | |
SUMMARY OF FUTURE MINIMUM PAYMENTS | At June 30, 2022, future minimum payments under the Company’s debt were as follows: SUMMARY OF FUTURE MINIMUM PAYMENTS Amount Remainder of 2022 $ 3,234,000 2023 6,469,000 2024 6,469,000 2025 6,469,000 2026 77,158,000 Total minimum payments 99,799,000 Less: amount representing interest payments (24,799,000 ) Notes payable, gross 75,000,000 Less: unamortized discount, net of premium (2,958,000 ) Notes payable, net of unamortized discount $ 72,042,000 |
LEASES (Tables)
LEASES (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Leases | |
SCHEDULE OF FUTURE LEASE PAYMENT UNDER OPERATING LEASES | Future lease payments under operating leases as of June 30, 2022 were as follows : SCHEDULE OF FUTURE LEASE PAYMENT UNDER OPERATING LEASES Operating Leases Remainder of 2022 $ 569,000 2023 1,231,000 2024 1,262,000 2025 1,093,000 2026 1,114,000 Thereafter 6,801,000 Total minimum lease payments 12,070,000 Less: amount representing interest payments (3,733,000 ) Total operating lease liabilities 8,337,000 Less: current portion, operating lease liabilities (633,000 ) Operating lease liabilities, net of current portion $ 7,704,000 |
STOCKHOLDERS_ EQUITY AND STOC_2
STOCKHOLDERS’ EQUITY AND STOCK-BASED COMPENSATION (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Equity [Abstract] | |
SCHEDULE OF STOCK OPTION PLAN ACTIVITY | A summary of stock option activity under the Plans for the six months ended June 30, 2022 is as follows: SCHEDULE OF STOCK OPTION PLAN ACTIVITY Number of Shares Weighted Weighted Average Remaining Contractual Life Aggregate Intrinsic Value Options outstanding – January 1, 2022 3,039,546 $ 5.52 Options granted 281,250 $ 7.38 Options exercised (128,000 ) $ 2.45 Options cancelled/forfeited (14,500 ) $ 7.60 Options outstanding – June 30, 2022 3,178,296 $ 5.80 4.92 $ 5,539,000 Options exercisable 2,444,993 $ 5.32 4.42 $ 5,366,000 Options vested and expected to vest 3,178,296 $ 5.80 4.92 $ 5,539,000 |
SCHEDULE OF FAIR VALUE ASSUMPTIONS | The table below illustrates the fair value per share determined using the Black-Scholes-Merton option pricing model with the following assumptions used for valuing options granted to employees: SCHEDULE OF FAIR VALUE ASSUMPTIONS 2022 Weighted-average fair value of options granted $ 4.54 Expected terms (in years) 6.11 Expected volatility 68 70 % Risk-free interest rate 1.54 2.78 % Dividend yield - |
SCHEDULE OF STOCK OPTION OUTSTANDING AND EXERCISABLE | The following table summarizes information about stock options outstanding and exercisable at June 30, 2022: SCHEDULE OF STOCK OPTION OUTSTANDING AND EXERCISABLE Options Outstanding Options Exercisable Range of Exercise Prices Number Outstanding Weighted Average Remaining Contractual Life in Years Weighted Number Weighted $ 1.47 2.23 595,887 5.04 $ 1.97 595,887 $ 1.97 $ 2.40 3.50 53,568 6.05 $ 3.00 42,507 $ 2.88 $ 3.95 370,000 3.75 $ 3.95 370,000 $ 3.95 $ 4.08 6.30 578,850 5.47 $ 5.76 534,605 $ 5.83 $ 6.80 7.30 409,995 7.81 $ 7.21 230,370 $ 7.27 $ 7.37 7.79 297,323 6.34 $ 7.54 139,699 $ 7.47 $ 7.87 600,000 3.08 $ 7.87 300,000 $ 7.87 $ 7.89 8.75 82,673 7.06 $ 8.06 48,800 $ 8.16 $ 8.98 10,000 8.59 $ 8.98 3,125 $ 8.98 $ 8.99 180,000 0.84 $ 8.99 180,000 $ 8.99 $ 1.47 8.99 3,178,296 4.92 $ 5.80 2,444,993 $ 5.32 |
SCHEDULE OF RESTRICTED STOCK UNITS ACTIVITY | A summary of the Company’s RSU activity (including performance stock units) and related information for the six months ended June 30, 2022 is as follows: SCHEDULE OF RESTRICTED STOCK UNITS ACTIVITY Number of RSUs Weighted Average Grant Date Fair Value RSUs unvested - January 1, 2022 2,233,202 $ 6.78 RSUs granted 65,615 $ 7.62 RSUs vested (204,288 ) $ 6.52 RSUs cancelled/forfeited - - RSUs unvested - June 30, 2022 2,094,529 $ 6.83 |
SCHEDULE OF WARRANTS ACTIVITY | A summary of warrant activity for the six months ended June 30, 2022 is as follows: SCHEDULE OF WARRANTS ACTIVITY Number of Shares Subject to Warrants Outstanding Weighted Average Exercise Price Warrants outstanding– January 1, 2022 373,847 $ 2.08 Granted - Exercised - Expired - Warrants outstanding and exercisable – June 30, 2022 373,847 $ 2.08 Weighted average remaining contractual life of the outstanding warrants in years – June 30, 2022 2.1 |
SCHEDULE OF WARRANTS OUTSTANDING AND WARRANTS EXERCISABLE | Warrants outstanding and exercisable as of June 30, 2022 are as follows: SCHEDULE OF WARRANTS OUTSTANDING AND WARRANTS EXERCISABLE Warrant Series Issue Date Warrants Outstanding Exercise Price Expiration Date Lender warrants 7/19/2017 373,847 $ 2.08 7/19/2024 |
SCHEDULE OF STOCK BASED COMPENSATION GRANTED TO EMPLOYEES DIRECTORS CONSULTANTS | The Company recorded stock-based compensation related to equity instruments granted to employees, directors and consultants as follows: SCHEDULE OF STOCK BASED COMPENSATION GRANTED TO EMPLOYEES DIRECTORS CONSULTANTS 2022 2021 2022 2021 For the Three Months Ended June 30, For the Six Months Ended June 30, 2022 2021 2022 2021 Employees – selling, general and administrative $ 1,655,000 $ 923,000 $ 3,331,000 $ 1,678,000 Employees – R&D 176,000 55,000 362,000 55,000 Directors – selling, general and administrative 112,000 100,000 212,000 200,000 Consultants – R&D 50,000 - 104,000 - Total $ 1,993,000 $ 1,078,000 $ 4,009,000 $ 1,933,000 |
SCHEDULE OF BASIC AND DILUTED E
SCHEDULE OF BASIC AND DILUTED EARNINGS PER COMMON SHARE (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Accounting Policies [Abstract] | ||||
Numerator – net loss attributable to common stockholders | $ (6,239,000) | $ (2,950,000) | $ (8,677,000) | $ (2,733,000) |
Denominator – weighted average number of shares outstanding, basic and diluted | 27,303,458 | 26,736,970 | 27,265,350 | 26,379,943 |
Net loss per share of common stock, basic and diluted | $ (0.23) | $ (0.11) | $ (0.32) | $ (0.10) |
SCHEDULE OF INVESTMENT (Details
SCHEDULE OF INVESTMENT (Details) | 6 Months Ended |
Jun. 30, 2022 USD ($) | |
Melt Pharmaceuticals, Inc. [Member] | |
Net Investment Income [Line Items] | |
Cost Basis | $ 19,310,000 |
Share of Equity Method Losses | (13,709,000) |
Paid in Kind Interest | 1,484,000 |
In Substance Capital Contributions | (1,484,000) |
Net carrying value | 5,601,000 |
Common Stock [Member] | Melt Pharmaceuticals, Inc. [Member] | |
Net Investment Income [Line Items] | |
Cost Basis | 5,810,000 |
Share of Equity Method Losses | (5,810,000) |
Paid in Kind Interest | |
Common Stock [Member] | Surface Ophthalmics, Inc. [Member] | |
Net Investment Income [Line Items] | |
Cost Basis | 5,320,000 |
Share of Equity Method Losses | (5,320,000) |
Net carrying value | |
Loan [Member] | Melt Pharmaceuticals, Inc. [Member] | |
Net Investment Income [Line Items] | |
Cost Basis | 13,500,000 |
Share of Equity Method Losses | (7,899,000) |
Paid in Kind Interest | 1,484,000 |
In Substance Capital Contributions | (1,484,000) |
Net carrying value | $ 5,601,000 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Melt Pharmaceuticals, Inc. [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Ownership percentage | 46% | 46% | ||
Surface Ophthalmics, Inc. [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Ownership percentage | 20% | 20% | ||
Maximum [Member] | Eton Pharmaceuticals, Inc. [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Ownership percentage | 10% | 10% | ||
Eton Pharmaceuticals, Inc. [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Number of shares owned | 1,982,000 | 1,982,000 | ||
Shares price | $ 2.62 | $ 2.62 | ||
Unrealized Gain (Loss) on Investments | $ 3,449,000 | $ 3,584,000 | $ 3,310,000 | $ 6,419,000 |
Investment owned, at fair value | $ 5,193,000 | $ 5,193,000 | ||
Melt Pharmaceuticals, Inc. [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Number of shares owned | 3,500,000 | 3,500,000 | ||
Reduction in common stock investment | $ 0 | |||
Investment interest rate | 100% | 100% | ||
Surface Ophthalmics, Inc. [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Number of shares owned | 3,500,000 | 3,500,000 | ||
Reduction in common stock investment | $ 0 | |||
Restricted Stock Units (RSUs) [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Number of shares vestted, RSUs | 287,049 | 235,973 | ||
Stock Options, Unvested RSUs and Warrants [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Antidilutive securities | 5,646,672 | 4,121,398 |
SCHEDULE OF DISAGGREGATED REVEN
SCHEDULE OF DISAGGREGATED REVENUE (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Disaggregation of Revenue [Line Items] | ||||
Total revenues | $ 23,323,000 | $ 18,134,000 | $ 45,443,000 | $ 33,577,000 |
Product Sales Net [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 21,518,000 | 17,297,000 | 41,858,000 | 32,245,000 |
Commissions [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 1,212,000 | 827,000 | 2,532,000 | 1,312,000 |
Transfer Of Profit [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 593,000 | 1,053,000 | ||
License [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | $ 10,000 | $ 20,000 |
REVENUES (Details Narrative)
REVENUES (Details Narrative) - USD ($) | Jun. 30, 2022 | Dec. 31, 2021 |
Revenue from Contract with Customer [Abstract] | ||
Contract with Customer, Liability, Current | $ 83,000 | $ 16,000 |
SCHEDULE OF CONDENSED INCOME ST
SCHEDULE OF CONDENSED INCOME STATEMENT (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Revenues, net | $ 23,323,000 | $ 18,134,000 | $ 45,443,000 | $ 33,577,000 |
Loss from operations | 1,690,000 | 4,169,000 | 3,791,000 | 7,086,000 |
Net loss | $ (6,239,000) | $ (2,478,000) | (8,677,000) | (2,261,000) |
Melt Pharmaceuticals, Inc. [Member] | ||||
Revenues, net | ||||
Loss from operations | (6,518,000) | (2,177,000) | ||
Net loss | $ (6,518,000) | $ (2,177,000) |
SCHEDULE OF CONDENSED BALANCE S
SCHEDULE OF CONDENSED BALANCE SHEET (Details) - USD ($) | Jun. 30, 2022 | Dec. 31, 2021 |
Current assets | $ 64,703,000 | $ 60,662,000 |
Total assets | 98,062,000 | 98,329,000 |
Total liabilities | 92,668,000 | 87,398,000 |
Total preferred stock and stockholders’ deficit | 5,749,000 | 11,286,000 |
Total liabilities and stockholders’ equity | 98,062,000 | 98,329,000 |
Melt Pharmaceuticals, Inc. [Member] | ||
Current assets | 6,197,000 | 11,278,000 |
Non-current assets | 773,000 | |
Total assets | 6,970,000 | 11,278,000 |
Total liabilities | 17,662,000 | 15,732,000 |
Total preferred stock and stockholders’ deficit | (10,692,000) | (4,454,000) |
Total liabilities and stockholders’ equity | $ 6,970,000 | $ 11,278,000 |
INVESTMENT IN, AND NOTE RECEI_3
INVESTMENT IN, AND NOTE RECEIVABLE FROM MELT PHARMACEUTICALS, INC. - RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||
Sep. 30, 2021 | Feb. 28, 2019 | Jun. 30, 2022 | Jun. 30, 2022 | Apr. 30, 2022 | Dec. 31, 2021 | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||
Due from Related Parties | $ 109,000 | $ 109,000 | $ 48,000 | |||
Melt Pharmaceuticals, Inc. [Member] | ||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||
Reimbursable expenses | 40,000 | 70,000 | ||||
Due from Related Parties | 109,000 | 109,000 | $ 48,000 | |||
Management Services Agreement [Member] | Melt Pharmaceuticals, Inc. [Member] | ||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||
Administrative fees expense | $ 10,000 | |||||
Accounts receivable transferred to note receivable | $ 908,000 | $ 908,000 | ||||
Melt Loan Agreement [Member] | ||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||
Loan amount | $ 13,500,000 | |||||
Debt Instrument, Interest Rate, Stated Percentage | 12.50% | |||||
Increase in interest rate | 3% | |||||
Melt Loan Agreement [Member] | Investor [Member] | ||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||||
Loan amount | $ 15,000,000 |
SUMMARY OF CONDENSED INCOME STA
SUMMARY OF CONDENSED INCOME STATEMENT (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Revenues, net | $ 23,323,000 | $ 18,134,000 | $ 45,443,000 | $ 33,577,000 |
Loss from operations | 1,690,000 | 4,169,000 | 3,791,000 | 7,086,000 |
Net loss | $ (6,239,000) | $ (2,478,000) | (8,677,000) | (2,261,000) |
Surface Ophthalmics, Inc. [Member] | ||||
Revenues, net | ||||
Loss from operations | (3,526,000) | (4,712,000) | ||
Net loss | $ (3,526,000) | $ (4,712,000) |
SUMMARY OF CONDENSED BALANCE SH
SUMMARY OF CONDENSED BALANCE SHEET (Details) - USD ($) | Jun. 30, 2022 | Dec. 31, 2021 |
Current assets | $ 64,703,000 | $ 60,662,000 |
Total assets | 98,062,000 | 98,329,000 |
Total liabilities | 92,668,000 | 87,398,000 |
Total preferred stock and stockholders’ deficit | 5,749,000 | 11,286,000 |
Total liabilities and stockholders’ equity | 98,062,000 | 98,329,000 |
Surface Ophthalmics, Inc. [Member] | ||
Current assets | 18,192,000 | 21,731,000 |
Non-current assets | 661,000 | 412,000 |
Total assets | 18,853,000 | 22,143,000 |
Total liabilities | 1,624,000 | 1,514,000 |
Total preferred stock and stockholders’ deficit | 17,229,000 | 20,629,000 |
Total liabilities and stockholders’ equity | $ 18,853,000 | $ 22,143,000 |
INVESTMENT IN SURFACE OPHTHAL_3
INVESTMENT IN SURFACE OPHTHALMICS, INC. - RELATED PARTY TRANSACTIONS (Details Narrative) | Jun. 30, 2022 shares |
Surface Ophthalmics, Inc. [Member] | |
Investment Owned, Balance, Shares | 3,500,000 |
SCHEDULE OF INVENTORIES (Detail
SCHEDULE OF INVENTORIES (Details) - USD ($) | Jun. 30, 2022 | Dec. 31, 2021 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 3,217,000 | $ 2,441,000 |
Work in progress | 7,000 | |
Finished goods | 1,908,000 | 1,776,000 |
Total inventories | $ 5,132,000 | $ 4,217,000 |
SCHEDULE OF PREPAID EXPENSES AN
SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSETS (Details) - USD ($) | Jun. 30, 2022 | Dec. 31, 2021 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Prepaid insurance | $ 182,000 | $ 728,000 |
Due from Melt Pharmaceuticals | 109,000 | 48,000 |
Other prepaid expenses | 821,000 | 437,000 |
Deposits and other current assets | 73,000 | 92,000 |
Total prepaid expenses and other current assets | $ 1,185,000 | $ 1,305,000 |
SCHEDULE OF PROPERTY, PLANT AND
SCHEDULE OF PROPERTY, PLANT AND EQUIPMENT (Details) - USD ($) | Jun. 30, 2022 | Dec. 31, 2021 |
Property, Plant and Equipment [Abstract] | ||
Computer hardware | $ 806,000 | $ 772,000 |
Furniture and equipment | 538,000 | 443,000 |
Lab and pharmacy equipment | 4,195,000 | 4,056,000 |
Leasehold improvements | 5,843,000 | 5,703,000 |
Property, plant and equipment, gross | 11,382,000 | 10,974,000 |
Accumulated depreciation | (8,590,000) | (7,833,000) |
Property, plant and equipment, net | $ 2,792,000 | $ 3,141,000 |
PROPERTY, PLANT AND EQUIPMENT_2
PROPERTY, PLANT AND EQUIPMENT (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Property, Plant and Equipment [Abstract] | ||||
Depreciation | $ 381,000 | $ 361,000 | $ 757,000 | $ 797,000 |
SCHEDULE OF FINITE LIVED INTANG
SCHEDULE OF FINITE LIVED INTANGIBLE ASSETS (Details) - USD ($) | Jun. 30, 2022 | Dec. 31, 2021 |
Finite-Lived Intangible Assets [Line Items] | ||
Total gross capitalized software for internal-use | $ 1,101,000 | $ 1,101,000 |
Accumulated amortization | (655,000) | (569,000) |
Capitalized internal-use software in process | 1,312,000 | 781,000 |
Total finite lived intangible assets net | 1,758,000 | 1,313,000 |
Capitalized Internal Use Software [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total gross capitalized software for internal-use | 942,000 | 417,000 |
Third Party Software License [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total gross capitalized software for internal-use | $ 159,000 | $ 684,000 |
CAPITALIZED SOFTWARE DEVELOPM_3
CAPITALIZED SOFTWARE DEVELOPMENT COSTS (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Capitalized Software Development Costs [Member] | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Amortization expense | $ 43,000 | $ 51,000 | $ 86,000 | $ 79,000 |
SCHEDULE OF INTANGIBLE ASSETS (
SCHEDULE OF INTANGIBLE ASSETS (Details) - USD ($) | 6 Months Ended | |
Jun. 30, 2022 | Dec. 31, 2021 | |
Finite-Lived Intangible Assets [Line Items] | ||
Cost | $ 16,548,000 | |
Accumulated amortization | (1,532,000) | |
Impairment | ||
Net Carrying value | 15,016,000 | $ 15,813,000 |
Patents [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 971,000 | |
Accumulated amortization | (118,000) | |
Impairment | ||
Net Carrying value | $ 853,000 | |
Licenses [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Life | 20 years | |
Cost | $ 100,000 | |
Accumulated amortization | (18,000) | |
Impairment | ||
Net Carrying value | 82,000 | |
Trademarks [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 260,000 | |
Accumulated amortization | ||
Impairment | ||
Net Carrying value | $ 260,000 | |
Finite-Lived Intangible Assets, Amortization Method | Indefinite | |
New Drug Applications [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Life | 10 years | |
Cost | $ 13,635,000 | |
Accumulated amortization | (682,000) | |
Impairment | ||
Net Carrying value | 12,953,000 | |
Customer Relationships [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 1,519,000 | |
Accumulated amortization | (652,000) | |
Impairment | ||
Net Carrying value | $ 867,000 | |
Trade Names [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Life | 5 years | |
Cost | $ 5,000 | |
Accumulated amortization | (5,000) | |
Impairment | ||
Net Carrying value | ||
Non-Competition Clause [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 50,000 | |
Accumulated amortization | (50,000) | |
Impairment | ||
Net Carrying value | ||
State Pharmacy Licenses [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Life | 25 years | |
Cost | $ 8,000 | |
Accumulated amortization | (7,000) | |
Impairment | ||
Net Carrying value | $ 1,000 | |
Minimum [Member] | Patents [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Life | 17 years | |
Minimum [Member] | Customer Relationships [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Life | 3 years | |
Minimum [Member] | Non-Competition Clause [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Life | 3 years | |
Maximum [Member] | Patents [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Life | 19 years | |
Maximum [Member] | Customer Relationships [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Life | 15 years | |
Maximum [Member] | Non-Competition Clause [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Life | 4 years |
SCHEDULE OF AMORTIZATION EXPENS
SCHEDULE OF AMORTIZATION EXPENSES FOR INTANGIBLE ASSETS (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Finite-Lived Intangible Assets [Line Items] | ||||
Amortization of intangible assets | $ 398,000 | $ 39,000 | $ 802,000 | $ 79,000 |
Patents [Member] | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Amortization of intangible assets | 21,000 | 6,000 | 43,000 | 12,000 |
Licenses [Member] | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Amortization of intangible assets | 3,000 | 11,000 | 1,000 | |
New Drug Applications [Member] | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Amortization of intangible assets | 341,000 | 682,000 | ||
Customer Relationships [Member] | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Amortization of intangible assets | $ 33,000 | $ 33,000 | $ 66,000 | $ 66,000 |
SCHEDULE OF ESTIMATED FUTURE AM
SCHEDULE OF ESTIMATED FUTURE AMORTIZATION EXPENSE (Details) | Jun. 30, 2022 USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Remainder of 2022 | $ 795,000 |
2023 | 1,592,000 |
2024 | 1,592,000 |
2025 | 1,592,000 |
2026 | 1,595,000 |
Thereafter | 7,590,000 |
Intangible assets | $ 14,756,000 |
SCHEDULE OF ACCOUNTS PAYABLE AN
SCHEDULE OF ACCOUNTS PAYABLE AND ACCRUED EXPENSES (Details) - USD ($) | Jun. 30, 2022 | Dec. 31, 2021 |
Payables and Accruals [Abstract] | ||
Accounts payable | $ 8,038,000 | $ 5,174,000 |
Other accrued expenses | 49,000 | 49,000 |
Accrued interest | 1,114,000 | 1,114,000 |
Total accounts payable and accrued expenses | $ 9,201,000 | $ 6,337,000 |
SUMMARY OF FUTURE MINIMUM PAYME
SUMMARY OF FUTURE MINIMUM PAYMENTS (Details) - USD ($) | Jun. 30, 2022 | Dec. 31, 2021 |
Debt Disclosure [Abstract] | ||
Remainder of 2022 | $ 3,234,000 | |
2023 | 6,469,000 | |
2024 | 6,469,000 | |
2025 | 6,469,000 | |
2026 | 77,158,000 | |
Total minimum payments | 99,799,000 | |
Less: amount representing interest payments | (24,799,000) | |
Notes payable, gross | 75,000,000 | |
Less: unamortized discount, net of premium | (2,958,000) | |
Notes payable, net of unamortized discount | $ 72,042,000 | $ 71,654,000 |
DEBT (Details Narrative)
DEBT (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||||
Jan. 31, 2026 | Jun. 30, 2021 | May 31, 2021 | Apr. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Debt Instrument [Line Items] | ||||||||
Amortization of Debt Issuance Costs and Discounts | $ 388,000 | $ 288,000 | ||||||
8.625% Senior Notes Due 2026 [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt Instrument, Face Amount | $ 50,000,000 | |||||||
Debt Instrument, Increase (Decrease), Net | $ 5,000,000 | |||||||
Debt Instrument, Unamortized Premium | $ 322,000 | $ 322,000 | 322,000 | |||||
Debt Instrument, Interest Rate During Period | 8.625% | |||||||
Interest Expense, Other Long-Term Debt | $ 1,812,000 | 1,466,000 | 3,622,000 | 1,466,000 | ||||
Amortization of Debt Issuance Costs and Discounts | $ 195,000 | $ 192,000 | $ 388,000 | $ 192,000 | ||||
8.625% Senior Notes Due 2026 [Member] | Forecast [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt Instrument, Redemption, Description | redemption price equal to 100% of the principal amount of the Notes to be redeemed | |||||||
8.625% Senior Notes Due 2026 [Member] | Investor [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt Instrument, Increase (Decrease), Net | $ 20,000,000 | |||||||
Shares Issued, Price Per Share | $ 25.75 | $ 25 | $ 25.75 | $ 25.75 | ||||
Proceeds from Issuance of Debt | $ 19,164,000 | $ 51,909,000 | ||||||
Debt Instrument, Unamortized Discount (Premium) and Debt Issuance Costs, Net | $ 3,091,000 | |||||||
Interest Expense, Debt | 278,000 | |||||||
Debt Issuance Costs, Net | $ 1,158,000 | $ 1,158,000 | $ 1,158,000 |
SCHEDULE OF FUTURE LEASE PAYMEN
SCHEDULE OF FUTURE LEASE PAYMENT UNDER OPERATING LEASES (Details) - USD ($) | Jun. 30, 2022 | Dec. 31, 2021 |
Leases | ||
Remainder of 2022 | $ 569,000 | |
2023 | 1,231,000 | |
2024 | 1,262,000 | |
2025 | 1,093,000 | |
2026 | 1,114,000 | |
Thereafter | 6,801,000 | |
Total minimum lease payments | 12,070,000 | |
Less: amount representing interest payments | (3,733,000) | |
Total operating lease liabilities | 8,337,000 | |
Less: current portion, operating lease liabilities | (633,000) | $ (272,000) |
Operating lease liabilities, net of current portion | $ 7,704,000 | $ 6,012,000 |
LEASES (Details Narrative)
LEASES (Details Narrative) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 USD ($) ft² | Jun. 30, 2021 USD ($) | Jun. 30, 2022 USD ($) ft² | Jun. 30, 2021 USD ($) | |
Operating Lease, Weighted Average Discount Rate, Percent | 6.61% | 6.61% | ||
Operating Lease, Weighted Average Remaining Lease Term | 11 years 2 months 15 days | 11 years 2 months 15 days | ||
Operating Lease, Payments | $ | $ 207,000 | $ 251,000 | $ 373,000 | $ 502,000 |
Operating Lease, Expense | $ | $ 262,000 | $ 500,000 | ||
Carlsbad [Member] | ||||
Area of Land | 5,789 | 5,789 | ||
Lease expiration date description | July 2027 | |||
Ledgewood [Member] | ||||
Area of Land | 35,326 | 35,326 | ||
Lease expiration date description | July 2026 | |||
Additional square footage | 1,400 | |||
Ledgewood [Member] | Lease Amendment [Member] | ||||
Additional square footage | 8,900 | |||
Nashville [Member] | ||||
Area of Land | 5,500 | 5,500 | ||
Lease expiration date description | December 2024 | |||
Lessee, Operating Lease, Option to Extend | an option to extend the term for two additional five-year periods | |||
Nashville 1 [Member] | ||||
Area of Land | 11,552 | 11,552 | ||
Lease expiration date description | June 2027 | |||
Minimum [Member] | Office and Laboratory Space [Member] | ||||
Lease term | 1 year | 1 year | ||
Maximum [Member] | Office and Laboratory Space [Member] | ||||
Lease term | 5 years | 5 years |
SCHEDULE OF STOCK OPTION PLAN A
SCHEDULE OF STOCK OPTION PLAN ACTIVITY (Details) - Stock Option Plan [Member] | 6 Months Ended |
Jun. 30, 2022 USD ($) $ / shares shares | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Number of shares, outstanding, beginning balance | shares | 3,039,546 |
Weighted average exercise price, outstanding, beginning balance | $ / shares | $ 5.52 |
Number of shares, options granted | shares | 281,250 |
Weighted average exercise price, options granted | $ / shares | $ 7.38 |
Number of shares, options exercised | shares | (128,000) |
Weighted average exercise price, options exercised | $ / shares | $ 2.45 |
Number of shares, options cancelled/forfeited | shares | (14,500) |
Weighted average exercise price, options cancelled/forfeited | $ / shares | $ 7.60 |
Number of shares, outstanding, ending balance | shares | 3,178,296 |
Weighted average exercise price, outstanding, ending balance | $ / shares | $ 5.80 |
Weighted average. remaining contractual life, options outstanding | 4 years 11 months 1 day |
Aggregate intrinsic value, options outstanding | $ | $ 5,539,000 |
Number of shares, options exercisable | shares | 2,444,993 |
Weighted average exercise price, options exercisable | $ / shares | $ 5.32 |
Weighted average. remaining contractual life, options exercisable | 4 years 5 months 1 day |
Aggregate intrinsic value, options exercisable | $ | $ 5,366,000 |
Number of shares, options vested and expected to vest | shares | 3,178,296 |
Weighted average exercise price, options vested and expected to vest | $ / shares | $ 5.80 |
Weighted average. remaining contractual life, options vested and expected to vest | 4 years 11 months 1 day |
Aggregate intrinsic value, options vested and expected to vest | $ | $ 5,539,000 |
SCHEDULE OF FAIR VALUE ASSUMPTI
SCHEDULE OF FAIR VALUE ASSUMPTIONS (Details) - Options Granted to Employees [Member] | 6 Months Ended |
Jun. 30, 2022 $ / shares | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Weighted-average fair value of options granted | $ 4.54 |
Expected terms (in years) | 6 years 1 month 9 days |
Dividend yield | |
Minimum [Member] | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Expected volatility | 68% |
Risk-free interest rate | 1.54% |
Maximum [Member] | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Expected volatility | 70% |
Risk-free interest rate | 2.78% |
SCHEDULE OF STOCK OPTION OUTSTA
SCHEDULE OF STOCK OPTION OUTSTANDING AND EXERCISABLE (Details) | 6 Months Ended |
Jun. 30, 2022 $ / shares shares | |
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Range of Exercise Prices, minimum | $ 1.47 |
Range of Exercise Prices, maximum | $ 8.99 |
Number of Options Outstanding | shares | 3,178,296 |
Weighted Average Remaining Contractual Life in Years | 4 years 11 months 1 day |
Weighted Average Exercise Price | $ 5.80 |
Number Exercisable | shares | 2,444,993 |
Weighted Average Exercisable Exercise Price | $ 5.32 |
Range One [Member] | |
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Range of Exercise Prices, minimum | 1.47 |
Range of Exercise Prices, maximum | $ 2.23 |
Number of Options Outstanding | shares | 595,887 |
Weighted Average Remaining Contractual Life in Years | 5 years 14 days |
Weighted Average Exercise Price | $ 1.97 |
Number Exercisable | shares | 595,887 |
Weighted Average Exercisable Exercise Price | $ 1.97 |
Range Two [Member] | |
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Range of Exercise Prices, minimum | 2.40 |
Range of Exercise Prices, maximum | $ 3.50 |
Number of Options Outstanding | shares | 53,568 |
Weighted Average Remaining Contractual Life in Years | 6 years 18 days |
Weighted Average Exercise Price | $ 3 |
Number Exercisable | shares | 42,507 |
Weighted Average Exercisable Exercise Price | $ 2.88 |
Range Three [Member] | |
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Range of Exercise Prices, maximum | $ 3.95 |
Number of Options Outstanding | shares | 370,000 |
Weighted Average Remaining Contractual Life in Years | 3 years 9 months |
Weighted Average Exercise Price | $ 3.95 |
Number Exercisable | shares | 370,000 |
Weighted Average Exercisable Exercise Price | $ 3.95 |
Range Four [Member] | |
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Range of Exercise Prices, minimum | 4.08 |
Range of Exercise Prices, maximum | $ 6.30 |
Number of Options Outstanding | shares | 578,850 |
Weighted Average Remaining Contractual Life in Years | 5 years 5 months 19 days |
Weighted Average Exercise Price | $ 5.76 |
Number Exercisable | shares | 534,605 |
Weighted Average Exercisable Exercise Price | $ 5.83 |
Range Five [Member] | |
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Range of Exercise Prices, minimum | 6.80 |
Range of Exercise Prices, maximum | $ 7.30 |
Number of Options Outstanding | shares | 409,995 |
Weighted Average Remaining Contractual Life in Years | 7 years 9 months 21 days |
Weighted Average Exercise Price | $ 7.21 |
Number Exercisable | shares | 230,370 |
Weighted Average Exercisable Exercise Price | $ 7.27 |
Range Six [Member] | |
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Range of Exercise Prices, minimum | 7.37 |
Range of Exercise Prices, maximum | $ 7.79 |
Number of Options Outstanding | shares | 297,323 |
Weighted Average Remaining Contractual Life in Years | 6 years 4 months 2 days |
Weighted Average Exercise Price | $ 7.54 |
Number Exercisable | shares | 139,699 |
Weighted Average Exercisable Exercise Price | $ 7.47 |
Range Seven [Member] | |
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Range of Exercise Prices, maximum | $ 7.87 |
Number of Options Outstanding | shares | 600,000 |
Weighted Average Remaining Contractual Life in Years | 3 years 29 days |
Weighted Average Exercise Price | $ 7.87 |
Number Exercisable | shares | 300,000 |
Weighted Average Exercisable Exercise Price | $ 7.87 |
Range Eight [Member] | |
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Range of Exercise Prices, minimum | 7.89 |
Range of Exercise Prices, maximum | $ 8.75 |
Number of Options Outstanding | shares | 82,673 |
Weighted Average Remaining Contractual Life in Years | 7 years 21 days |
Weighted Average Exercise Price | $ 8.06 |
Number Exercisable | shares | 48,800 |
Weighted Average Exercisable Exercise Price | $ 8.16 |
Range Nine [Member] | |
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Range of Exercise Prices, maximum | $ 8.98 |
Number of Options Outstanding | shares | 10,000 |
Weighted Average Remaining Contractual Life in Years | 8 years 7 months 2 days |
Weighted Average Exercise Price | $ 8.98 |
Number Exercisable | shares | 3,125 |
Weighted Average Exercisable Exercise Price | $ 8.98 |
Range Ten [Member] | |
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Range of Exercise Prices, maximum | $ 8.99 |
Number of Options Outstanding | shares | 180,000 |
Weighted Average Remaining Contractual Life in Years | 10 months 2 days |
Weighted Average Exercise Price | $ 8.99 |
Number Exercisable | shares | 180,000 |
Weighted Average Exercisable Exercise Price | $ 8.99 |
SCHEDULE OF RESTRICTED STOCK UN
SCHEDULE OF RESTRICTED STOCK UNITS ACTIVITY (Details) - Restricted Stock Units (RSUs) [Member] | 6 Months Ended |
Jun. 30, 2022 $ / shares shares | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Number of RSUs unvested, outstanding, beginning balance | shares | 2,233,202 |
Weighted average grant date fair value, beginning balance | $ / shares | $ 6.78 |
Number of RSUs granted | shares | 65,615 |
Weighted average grant date fair value, RSUs granted | $ / shares | $ 7.62 |
Number of RSUs vested | shares | (204,288) |
Weighted average grant date fair value, RSUs vested | $ / shares | $ 6.52 |
Number of RSUs cancelled/forfeited | shares | |
Weighted average grant date fair value, RSUs cancelled/forfeited | $ / shares | |
Number of RSUs unvested, outstanding, ending balance | shares | 2,094,529 |
Weighted average grant date fair value, ending balance | $ / shares | $ 6.83 |
SCHEDULE OF WARRANTS ACTIVITY (
SCHEDULE OF WARRANTS ACTIVITY (Details) - Warrant [Member] | 6 Months Ended |
Jun. 30, 2022 $ / shares shares | |
Class of Warrant or Right [Line Items] | |
Number of Shares Warrants Outstanding, beginning balance | 373,847 |
Weighted average. exercise price, outstanding, beginning balance | $ / shares | $ 2.08 |
Number of shares warrants outstanding, granted | |
Share-based payment award, non-option equity instruments, exercised | |
Share-based payment award, non - option equity instruments, expirations | |
Number of shares warrants outstanding, ending balance | 373,847 |
Weighted average. exercise price, outstanding, ending balance | $ / shares | $ 2.08 |
Weighted average remaining contractual life of the outstanding warrants in years | 2 years 1 month 6 days |
SCHEDULE OF WARRANTS OUTSTANDIN
SCHEDULE OF WARRANTS OUTSTANDING AND WARRANTS EXERCISABLE (Details) - Lender Warrants [Member] | 6 Months Ended |
Jun. 30, 2022 $ / shares shares | |
Defined Benefit Plan Disclosure [Line Items] | |
Issue Date | Jul. 19, 2017 |
Warrants Outstanding | shares | 373,847 |
Exercise Price | $ / shares | $ 2.08 |
Expiration Date | Jul. 19, 2024 |
SCHEDULE OF STOCK BASED COMPENS
SCHEDULE OF STOCK BASED COMPENSATION GRANTED TO EMPLOYEES DIRECTORS CONSULTANTS (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Deferred Compensation Arrangement with Individual, Excluding Share-Based Payments and Postretirement Benefits [Line Items] | ||||
Total | $ 1,993,000 | $ 1,078,000 | $ 4,009,000 | $ 1,933,000 |
Employees [Member] | Selling, General and Administrative Expenses [Member] | ||||
Deferred Compensation Arrangement with Individual, Excluding Share-Based Payments and Postretirement Benefits [Line Items] | ||||
Total | 1,655,000 | 923,000 | 3,331,000 | 1,678,000 |
Employees [Member] | Research and Development Expense [Member] | ||||
Deferred Compensation Arrangement with Individual, Excluding Share-Based Payments and Postretirement Benefits [Line Items] | ||||
Total | 176,000 | 55,000 | 362,000 | 55,000 |
Director [Member] | Selling, General and Administrative Expenses [Member] | ||||
Deferred Compensation Arrangement with Individual, Excluding Share-Based Payments and Postretirement Benefits [Line Items] | ||||
Total | 112,000 | 100,000 | 212,000 | 200,000 |
Consultant [Member] | Research and Development Expense [Member] | ||||
Deferred Compensation Arrangement with Individual, Excluding Share-Based Payments and Postretirement Benefits [Line Items] | ||||
Total | $ 50,000 | $ 104,000 |
STOCKHOLDERS_ EQUITY AND STOC_3
STOCKHOLDERS’ EQUITY AND STOCK-BASED COMPENSATION (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||||||
May 31, 2022 | Feb. 28, 2022 | May 31, 2019 | Feb. 28, 2019 | Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||
Preferred stock, shares authorized | 5,000,000 | 5,000,000 | 5,000,000 | ||||||
Preferred stock, par or stated value per share | $ 0.001 | $ 0.001 | $ 0.001 | ||||||
Preferred stock, shares issued | 0 | 0 | 0 | ||||||
Preferred stock, shares outstanding | 0 | 0 | 0 | ||||||
Stock-based compensation | $ 4,009,000 | $ 1,933,000 | |||||||
2017 Incentive Stock and Awards Plan [Member] | |||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||
Share-based compensation arrangement by share-based payment award, number of shares authorized | 6,000,000 | 6,000,000 | |||||||
Share-based compensation arrangement by share-based payment award, number of shares available for grant | 2,067,284 | 2,067,284 | |||||||
Restricted Stock Units (RSUs) [Member] | |||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||
Number of restricted stock units granted | 65,615 | ||||||||
Stock Option Plan [Member] | |||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||
Closing price of common stock price per share | $ 7.28 | $ 7.28 | |||||||
Unrecognized compensation expense related to unvested stock options granted under the plan | $ 2,013,000 | $ 2,013,000 | |||||||
Expense expected to recognize over the weighted-average remaining vesting period | 3 years 1 month 24 days | ||||||||
Stock-based compensation | 258,000 | $ 569,000 | $ 530,000 | 1,021,000 | |||||
Intrinsic value of options exercised | $ 754,000 | ||||||||
Stock Option Plan [Member] | Employees and Consultant [Member] | |||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||
Weighted avg. remaining contractual life, options exercisable | 10 years | ||||||||
Share-based compensation arrangement by share-based payment award, plan modification, description and terms | vesting schedule: 25% of the shares subject to the option vest and become exercisable on the first anniversary of the grant date and the remaining 75% of the shares subject to the option vest and become exercisable quarterly in equal installments thereafter over three years. Certain option awards provide for accelerated vesting if there is a change in control (as defined in the Plans) and in the event of certain modifications to the option award agreement | ||||||||
Unvested RSUs [Member] | |||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||
Unrecognized compensation expense related to unvested stock options granted under the plan | 8,819,000 | $ 8,819,000 | |||||||
Expense expected to recognize over the weighted-average remaining vesting period | 1 year 1 month 6 days | ||||||||
Stock-based compensation | $ 1,735,000 | 481,000 | $ 3,479,000 | 827,000 | |||||
Subsidiary Stock [Member] | |||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||
Stock-based compensation | $ 28,000 | $ 0 | $ 85,000 | ||||||
Common Stock [Member] | |||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||
Number of shares isssued | 36,851 | 20,298 | |||||||
Common stock withheld for payroll tax withholdings, shares | 13,149 | 14,702 | |||||||
Common stock withheld for payroll tax withholdings, value | $ 99,000 | $ 116,000 | |||||||
Common Stock [Member] | Options Held [Member] | |||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||
Number of shares isssued | 3,000 | ||||||||
Proceeds from issuance of common stock | $ 7,000 | ||||||||
Exercise Price | 3,000 | 3,000 | |||||||
Common Stock [Member] | Options Held [Member] | Minimum [Member] | |||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||
Exercise Price | 1.70 | 1.70 | |||||||
Common Stock [Member] | Options Held [Member] | Maximum [Member] | |||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||
Exercise Price | 3.95 | 3.95 | |||||||
Common Stock [Member] | Restricted Stock Units (RSUs) [Member] | |||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||
Number of restricted stock units granted | 50,000 | 35,000 | |||||||
Common Stock [Member] | Restricted Stock Units (RSUs) [Member] | Director [Member] | |||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||
Number of shares isssued | 19,288 | ||||||||
Mark L. Baum [Member] | |||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||
Number of shares isssued | 53,594 | ||||||||
Cashless exercise of options, shares | 125,000 | ||||||||
Cashless exercise of options, price per shares | $ 2.40 | ||||||||
Common stock withheld on cashless exercise | 36,014 | ||||||||
Common stock withheld for payroll tax withholdings, shares | 35,392 | ||||||||
Common stock withheld for payroll tax withholdings, value | $ 295,000 | ||||||||
Andrew R. Boll [Member] | |||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||
Number of shares isssued | 29,395 | ||||||||
Common stock withheld for payroll tax withholdings, shares | 20,605 | ||||||||
Number of restricted stock units granted | 50,000 | ||||||||
Common stock withheld for payroll tax withholdings, value | $ 162,000 | ||||||||
John P. Saharek [Member] | |||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||
Number of shares isssued | 24,077 | ||||||||
Common stock withheld for payroll tax withholdings, shares | 25,923 | ||||||||
Common stock withheld for payroll tax withholdings, value | $ 204,000 | ||||||||
Number of restricted stock units granted | 50,000 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||||
Aug. 31, 2021 | Jul. 31, 2021 | Dec. 31, 2019 | Apr. 30, 2017 | Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
Klarity License Agreement [Member] | |||||||||
Loss Contingencies [Line Items] | |||||||||
Milestone payment in cash | $ 92,000 | $ 35,000 | $ 122,000 | $ 70,000 | |||||
Royalty expense | 106,000 | 44,000 | 177,000 | 79,000 | |||||
Klarity License Agreement [Member] | Richard L. Lindstrom, M.D [Member] | |||||||||
Loss Contingencies [Line Items] | |||||||||
Royalty payment description | Under the terms of the Klarity License Agreement, the Company is required to make royalty payments to Dr. Lindstrom ranging from 3% to 6% of net sales, dependent upon the final formulation of the Klarity Product sold | ||||||||
Injectable Asset Purchase Agreement [Member] | |||||||||
Loss Contingencies [Line Items] | |||||||||
Milestone payment in cash | 7,000 | 7,000 | 15,000 | 14,000 | |||||
Royalty expense | 8,000 | 7,000 | $ 15,000 | 14,000 | |||||
Injectable Asset Purchase Agreement [Member] | Richard L. Lindstrom, M.D [Member] | |||||||||
Loss Contingencies [Line Items] | |||||||||
Royalty payment description | the Company is required to make royalty payments to Dr. Lindstrom ranging from 2% to 3% of net sales, dependent upon the final formulation and patent protection of the Lindstrom Product sold | ||||||||
Initial milestone payment | $ 33,000 | ||||||||
Dexycu Agreement [Member] | |||||||||
Loss Contingencies [Line Items] | |||||||||
Expiration date | Aug. 01, 2025 | ||||||||
Commission revenues | 1,212,000 | 827,000 | $ 2,532,000 | 1,312,000 | |||||
Sales and Marketing Agreements [Member] | |||||||||
Loss Contingencies [Line Items] | |||||||||
Description for commission payments | Under the terms of the sales and marketing agreements, the Company is generally required to make commission payments equal to 10% to 14% of net sales for products above and beyond the initial existing sales amounts | ||||||||
Commission expenses | 1,100,000 | 1,032,000 | $ 2,147,000 | 1,836,000 | |||||
Sales and Marketing Agreements [Member] | Minimum [Member] | |||||||||
Loss Contingencies [Line Items] | |||||||||
Commission payments percentage | 10% | ||||||||
Sales and Marketing Agreements [Member] | Maximum [Member] | |||||||||
Loss Contingencies [Line Items] | |||||||||
Commission payments percentage | 14% | ||||||||
Asset Purchase, License and Related Agreements [Member] | |||||||||
Loss Contingencies [Line Items] | |||||||||
Royalty expense | 297,000 | 261,000 | $ 510,000 | 493,000 | |||||
Sintetica Agreement [Member] | |||||||||
Loss Contingencies [Line Items] | |||||||||
Payment for royalties | $ 18,000,000 | ||||||||
Sintetica Agreement [Member] | Research and Development Expense [Member] | |||||||||
Loss Contingencies [Line Items] | |||||||||
Payment for royalties | $ 3,117,000 | ||||||||
Sintetica Agreement [Member] | Due Within Thirty Days [Member] | |||||||||
Loss Contingencies [Line Items] | |||||||||
Payment for royalties | $ 5,000,000 | ||||||||
Wakamoto Agreement [Member] | |||||||||
Loss Contingencies [Line Items] | |||||||||
Payment for royalties | $ 2,000,000 | ||||||||
Commercial payments for royalties | $ 6,200,000 | ||||||||
Presbyopia Asset Purchase Agreement [Member] | |||||||||
Loss Contingencies [Line Items] | |||||||||
Milestone payment in cash | 0 | 0 | 0 | 0 | |||||
Royalty expense | 0 | 0 | 0 | 0 | |||||
Milestone payment in cash | $ 0 | $ 0 | $ 0 | $ 0 | |||||
Presbyopia Asset Purchase Agreement [Member] | Richard L. Lindstrom, M.D [Member] | |||||||||
Loss Contingencies [Line Items] | |||||||||
Royalty payment description | the Company is required to make royalty payments to Dr. Lindstrom ranging from 2% to 4% of net sales, dependent upon the final formulation and patent protection of the Presbyopia Product sold |
CONCENTRATIONS (Details Narrati
CONCENTRATIONS (Details Narrative) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Cost of Goods and Service, Product and Service Benchmark [Member] | Supplier Concentration Risk [Member] | Three Main Suppliers [Member] | ||||
Concentration Risk [Line Items] | ||||
Concentration risk percentage | 72% | 85% | 73% | 79% |
Two Product Concentration Risk [Member] | Revenue Benchmark [Member] | Product Concentration Risk [Member] | ||||
Concentration Risk [Line Items] | ||||
Concentration risk percentage | 32% | 36% | 32% | 36% |