Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Mar. 31, 2015 | Jun. 30, 2014 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | Q Therapeutics, Inc. | ||
Entity Central Index Key | 1366541 | ||
Document Type | 10-K | ||
Document Period End Date | 31-Dec-14 | ||
Amendment Flag | FALSE | ||
Current Fiscal Year End Date | -19 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filer | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Common Stock, Shares Outstanding | 30,826,549 | ||
Entity Public Float | $0 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2014 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Current assets: | ||
Cash | $707,011 | $142,532 |
Receivables | 4,136 | 5,556 |
Prepaid financing costs, net | 63,333 | |
Prepaid expenses and other | 10,596 | 10,109 |
Total current assets | 721,743 | 221,530 |
Property and equipment, net | 26,568 | 27,999 |
Other assets | 7,513 | |
Total assets | 748,311 | 257,042 |
Current liabilities: | ||
Accounts payable | 263,728 | 2,364,001 |
Accrued liabilities | 42,507 | 81,156 |
Accrued compensation | 705,753 | 353,950 |
Notes payable | 500,000 | |
Derivative liabilities | 32,175 | |
Total current liabilities | 1,044,163 | 3,299,107 |
Commitments (Note 9) | ||
Stockholders' deficit: | ||
Common stock, $0.0001 par value: 100,000,000 shares authorized; 30,477,460 and 24,936,833 shares outstanding as of December 31, 2014 and 2013, respectively | 3,048 | 2,494 |
Additional paid-in capital | 26,933,171 | 20,836,811 |
Accumulated deficit | -27,232,071 | -23,881,370 |
Total stockholders' deficit | -295,852 | -3,042,065 |
Total liabilities and stockholders' deficit | $748,311 | $257,042 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Consolidated Balance Sheets [Abstract] | ||
Common stock, par value (in Dollars per Share) | $0.00 | $0.00 |
Common stock, shares authorized (in Shares) | 100,000,000 | 100,000,000 |
Common stock, shares outstanding (in Shares) | 30,477,460 | 24,936,833 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Consolidated Statements of Operations [Abstract] | ||
Grant revenues | $677,864 | $14,175 |
Other revenues | 2,400 | 12,000 |
Total revenues | 680,264 | 26,175 |
Cost of revenues | 800 | 4,800 |
Gross profit | 679,464 | 21,375 |
Operating expenses: | ||
Research and development | 1,960,815 | 1,827,533 |
General and administrative | 2,098,851 | 1,384,712 |
Total operating expenses | 4,059,666 | 3,212,245 |
Operating loss | -3,380,202 | -3,190,870 |
Other income (expense): | ||
Gain on derivative liability | 134,019 | |
Interest expense | -111,022 | -202,111 |
Other income, net | 6,504 | 3,889 |
Total other income (expense) | 29,501 | -198,222 |
Loss before provision (benefit) for income taxes | -3,350,701 | -3,389,092 |
Provision (benefit) for income taxes | ||
Net loss | ($3,350,701) | ($3,389,092) |
Weighted average number of common shares outstanding - basic and diluted (in Shares) | 28,944,366 | 24,839,755 |
Net loss per common share - basic and diluted (in Dollars per Share) | ($0.12) | ($0.14) |
Consolidated_Statements_of_Sto
Consolidated Statements of Stockholders’ Equity (Deficit) (USD $) | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] |
Balance, beginning of period at Dec. 31, 2012 | $4,990 | $2,476 | $20,494,792 | ($20,492,278) |
Balance, beginning of period (in Shares) at Dec. 31, 2012 | 24,761,832 | |||
Common stock issued for: | ||||
Options exercised (in Shares) | ||||
Issued for services | 175,000 | 18 | 174,982 | |
Issued for services (in Shares) | 175,001 | |||
Warrants issued for services | 65,284 | 65,284 | ||
Stock-based compensation expense | 101,753 | 101,753 | ||
Net loss | -3,389,092 | -3,389,092 | ||
Balance, end of period at Dec. 31, 2013 | -3,042,065 | 2,494 | 20,836,811 | -23,881,370 |
Balance, end of period (in Shares) at Dec. 31, 2013 | 24,936,833 | |||
Common stock issued for: | ||||
Cash, $1.00 per unit, containing one share of common stock and one warrant | 2,016,000 | 202 | 2,015,798 | |
Issuance of equity units for cash, $1.00 per unit, containing one share of common stock and one warrant (in Shares) | 2,016,000 | |||
Issuance of common stock upon exercise of stock options | 15,366 | 10 | 15,356 | |
Options exercised (in Shares) | 100,734 | 100,734 | ||
License agreements | 45,500 | 6 | 45,594 | |
License agreements (in Shares) | 65,000 | |||
Issued for settlement of accounts payable | 2,727,030 | 273 | 2,726,758 | |
Issued for settlement of accounts payable (in Shares) | 2,727,030 | |||
Issued for settlement of debt | 531,863 | 53 | 531,809 | |
Common stock issued for settlement of debt (in Shares) | 531,863 | |||
Issued for services | 70,000 | 10 | 69,990 | |
Issued for services (in Shares) | 100,000 | |||
Warrants issued for services | 27,390 | 27,390 | ||
Stock-based compensation expense | 829,959 | 829,959 | ||
Derivatives related to common stock and warrant down-round protection rights | -166,194 | -166,194 | ||
Net loss | -3,350,701 | -3,350,701 | ||
Balance, end of period at Dec. 31, 2014 | ($295,852) | $3,048 | $26,933,171 | ($27,232,071) |
Balance, end of period (in Shares) at Dec. 31, 2014 | 30,477,460 |
Consolidated_Statements_of_Sto1
Consolidated Statements of Stockholders' Equity (Deficit) (Parenthetical) (Common Stock [Member], USD $) | 12 Months Ended |
Dec. 31, 2014 | |
Common Stock [Member] | |
Dollars per share containing one share of common stock and one warrant (Dollars per Share) | $1 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Cash flows from operating activities: | ||
Net loss | ($3,350,701) | ($3,389,092) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 9,665 | 11,847 |
Original debt discount | 63,333 | 186,667 |
Gain on derivative liabilities | -134,019 | |
Stock-based compensation | 829,959 | 101,753 |
Common stock issued for services | 115,500 | 175,000 |
Warrants issued for services | 27,390 | 65,284 |
Decrease in: | ||
Receivables | 1,420 | 472,246 |
Prepaid expenses and other assets | 7,026 | 257 |
Increase in: | ||
Accounts payable and accrued liabilities | 619,971 | 1,232,107 |
Accrued compensation | 351,803 | 266,058 |
Net cash used in operating activities | -1,458,653 | -877,873 |
Cash flows from investing activities: | ||
Purchase of property and equipment | -8,234 | -23,802 |
Cash flows from financing activities: | ||
Issuance of common stock for cash | 2,016,000 | |
Proceeds from exercise of common stock options | 15,366 | |
Proceeds from issuance of notes payable | 250,000 | |
Net cash provided by financing activities | 2,031,366 | 250,000 |
Net increase (decrease) in cash | 564,479 | -651,675 |
Cash as of beginning of the period | 142,532 | 794,207 |
Cash as of end of the period | 707,011 | 142,532 |
Supplemental disclosure of cash flow information: | ||
Cash paid for interest | $729 | $1,009 |
Consolidated_Statements_of_Cas1
Consolidated Statements of Cash Flows (Parenthetical) (USD $) | 2 Months Ended | 4 Months Ended |
Sep. 30, 2013 | Jun. 30, 2014 | |
Between August 12 and September 30, 2013, the Company received $250,000 in cash proceeds in exchange for notes payable of $500,000 and recorded a debt discount of $250,000 | ||
Proceeds from issuance of notes payable | $250,000 | |
Notes payable, face amount | 500,000 | |
Debt discount recorded | 250,000 | |
Between March 7 and June 30, 2014, the Company settled accounts payable of $2,727,030 with the issuance of 2,727,030 shares of common stock | ||
Value of accounts payable settled with common stock issuance | 2,727,030 | |
Common shares issued for settlement of accounts payable (in Shares) | 2,727,030 | |
Between March 7 and June 30, 2014, the Company settled notes payable and interest of $531,863 with the issuance of 531,863 shares of common stock | ||
Debt conversion, original debt amount | $531,863 | |
Common stock issued for settlement of debt (in Shares) | 531,863 |
Organization
Organization | 12 Months Ended | |
Dec. 31, 2014 | ||
Organization [Abstract] | ||
Organization | 1 | Organization |
Q Therapeutics, Inc. (Q Therapeutics) conducts its operations through its wholly owned subsidiary, Q Therapeutic Products, Inc. (Q Products), and its wholly owned subsidiary NeuroQ Research, Inc. (collectively, the Company). Q Therapeutics is a Salt Lake City, Utah-based biopharmaceutical company that is developing human cell-based therapies intended to treat degenerative diseases of the brain and spinal cord, the primary components of the central nervous system (CNS). Q Products was incorporated in the state of Delaware on March 28, 2002 and merged with Q Acquisition, Inc., a Delaware corporation and a wholly owned subsidiary of Grace 2, Inc., on October 13, 2011. Grace 2, Inc. was incorporated on October 27, 2005. On November 2, 2011, Grace 2 changed its name to Q Holdings, Inc. and on December 10, 2012, it changed its name to Q Therapeutics, Inc. | ||
These potential therapies are based on technology developed by Q Products’ co-founder Mahendra Rao, M.D., Ph.D., a leader in glial stem cell biology, during his tenure at the University of Utah and as Head of the Stem Cell Section in the Laboratory of Neuroscience at the National Institutes of Health (NIH) Institute of Aging. Dr. Rao was one of the first scientists to identify and seek patent coverage on stem cells and their progeny cells found in the CNS. After licensing Dr. Rao’s technology from the University of Utah and NIH, Q Products commenced operations in the spring of 2004 to develop cell-based therapeutics that can be sold as “off-the-shelf” pharmaceuticals. |
Significant_Accounting_Policie
Significant Accounting Policies | 12 Months Ended | ||
Dec. 31, 2014 | |||
Significant Accounting Policies [Abstract] | |||
Significant Accounting Policies | 2 | Significant Accounting Policies | |
The Company has adopted the following significant accounting policies in preparing its consolidated financial statements: | |||
Basis of Presentation and Consolidation | |||
The accompanying consolidated financial statements have been prepared by management in accordance with U.S. generally accepted accounting principles (US GAAP), and include all assets and liabilities of the Company and its wholly owned subsidiary, Q Therapeutic Products, Inc. All material transactions and balances have been eliminated. | |||
Going Concern Assumption and Liquidity | |||
The Company has not generated significant revenues and has been developing its products. Historically, the Company has been dependent on government grants and debt and equity raised from individual investors to sustain its operations. The Company’s continued operations will depend on its ability to raise funds through similar sources. There can be no assurance that such capital will be available on favorable terms or at all. If it is unable to raise additional capital, the Company will likely be forced to curtail desired development activities, which will delay the development of its product candidates. The Company’s products have not been approved by the U.S. Food and Drug Administration (FDA) for commercial sale; therefore, the Company has not generated revenues from commercial therapeutic product sales. | |||
The Company has incurred losses and has negative cash flows from operating activities. As of December 31, 2014, the Company had an accumulated deficit of $27,232,071, a stockholders’ deficit of $295,852, and negative working capital of $322,420. | |||
These uncertainties create substantial doubt about the Company’s ability to continue as a going concern. The Company’s financial statements have been prepared on a basis which assumes that the Company will continue as a going concern, which contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of business. The accompanying financial statements do not include any adjustments that may result from the outcome of this uncertainty. | |||
2014 Financing Transactions | |||
Between March 7 and April 14, 2014, the Company issued an aggregate of 4,420,530 units, each unit consisting of one share of the Company’s common stock and one warrant to purchase one share of the Company’s common stock for which the Company received cash consideration of $2,012,500 and the settlement of indebtedness of $2,408,030 (2014 Financing Transactions). The warrants have an initial exercise prices of $1.00 per share, are immediately exercisable, and expire in no more than four years. Both the shares of common stock and the warrants issued in the 2014 Financing Transactions have a “down-round” protection provision provided to the investors in the financing. With respect to the common shares and warrants issued with certain exceptions, if the Company subsequently issues or sells any shares of common stock or any common stock equivalents pursuant to which shares of common stock may be acquired at a prices less than $1.00 per share, then the Company shall promptly issue additional shares of common stock to the investor in an amount such that the subscription price paid, when divided by the total number of shares issued will result in an actual price paid per share of common stock equal to such lower price and with respect to warrants, the warrant exercise price shall be reduced to the lesser price at which the common stock or common stock equivalents were issued. The down-round provisions expire upon the earlier of (1) the effectiveness of a registration statement with the Securities Exchange Commission (SEC) registering the shares of common stock issued and the common shares underlying warrants issued in the 2014 Financing Transactions, or (2) one year after the issuance date. The down-round protection related to the March 7, 2014 round of financing has expired. The remaining down-round protection will expire by June 30, 2015. | |||
On June 30, 2014, the Company issued 854,363 shares of common stock and warrants to purchase 1,277,363 shares of common stock resulting from an additional tranche of financing for which the Company received cash consideration of $3,500 and a settlement of indebtedness of $850,863. The common stock and warrants have terms similar to the 2014 Financing Transactions. | |||
Between January 26, 2015 and February 23, 2015, 327,455 warrants and 21,634 options were exercised for cash proceeds of $114,131. | |||
Use of Estimates | |||
The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the dates of the financial statements and the reported amounts of the revenues and expenses for the reporting periods. Accordingly, actual results could differ from those estimates. Key estimates include allowances for doubtful accounts receivable, useful lives for property and equipment, valuation allowances for net deferred income tax assets, and valuations for stock-based compensation awards. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. | |||
Revenue Recognition and Receivables | |||
The Company periodically applies for research grants, generally as a sub-recipient to grants funded by government agencies through research institutions. Grant revenues are recognized as associated expenses are incurred and are billed in conjunction with the terms of the grants. The Company records its grants receivable in accordance with the provisions of the grant agreements. The Company’s grants receivable are considered past due when payment has not been received within 30 days of the invoice date, although certain institutions customarily do not pay within these terms. The amounts of the specific allowances are estimated by management based on various assumptions including the age of the individual receivable, and changes in payment schedules and histories. Receivable balances are charged off against the allowance for doubtful accounts when management determines the probability of collection is remote. Recoveries of receivables previously charged off are recorded when payment is received. Revenue earned in 2014 was derived from two customers. The Company did not incur any losses relating to bad debts associated with grant revenues for the years ended December 31, 2014 and 2013. | |||
In June 2014, the Company was notified of a sub-award as part of the fourth and final year of grant funding awarded to The Johns Hopkins University from the National Institute of Neurological Disorders and Stroke (NINDS) of the National Institutes of Health in the amount of $677,864. As of December 31, 2014, $4,136 remains receivable from this sub-award. | |||
Concentration of Suppliers | |||
The Company has entered and will enter into agreements with outside research facilities to assist in the clinical research, monitoring, and reporting of its pilot and clinical studies. In some instances, the Company is dependent upon a single supplier. The loss of key suppliers could have a material adverse effect upon the Company’s operations by interrupting or delaying the progress or completion of the Company’s clinical trials. | |||
For the year ended December 31, 2014, one supplier accounted for approximately 61.4% of the Company’s research and development purchases. | |||
Property and Equipment | |||
Property and equipment are stated at cost less accumulated depreciation and amortization. Depreciation and amortization are calculated using the straight-line method over the estimated economic useful lives of the assets as follows: | |||
Lab equipment | 5 years | ||
Computers and software | 3 years | ||
Leasehold improvements | 7 years | ||
Office equipment and furniture | 3 years | ||
Expenditures that materially increase values or capacities or extend useful lives of property and equipment are capitalized. Routine maintenance and repairs are expensed as incurred. Upon sale or other retirement of depreciable property, the cost and accumulated depreciation are removed from the related accounts and any gain or loss is reflected in the statements of operations. | |||
Impairment of Long-Lived Assets | |||
The Company reviews its property, equipment, and other long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amounts of the assets may be impaired. Management does not consider any of the Company’s assets to be impaired as of December 31, 2014 and 2013. | |||
Leases | |||
The Company leases its research and office facility under an operating lease. The current lease expires on March 31, 2016. If rent escalations in the new lease are material, the Company will record the total rent payable during the lease term on a straight-line basis over the term of the lease. The Company will record any difference between the rent paid and the straight-line rent as a deferred rent liability. | |||
Stock-Based Compensation | |||
The Company calculates the estimated fair value of its stock options and warrants on the grant date using the Black-Scholes option-pricing model. The Company recognizes stock-based compensation expense as services are provided, which is generally over the vesting period of the individual equity instruments. Expense related to stock options issued in lieu of cash to non-employees for services performed are measured at the fair value of the options on the date they are earned and the related expense is recognized as services are provided. | |||
The volatility assumption used in the Black-Scholes option-pricing model is based on the volatility of publicly traded companies in the same industry segment as the Company. The expected lives of the options and warrants granted represent the periods of time that the options granted are expected to be outstanding. The risk free rates for periods within the contractual lives of the options and warrants are based on the U.S. Treasury securities constant maturity rate that corresponds to the expected terms in effect at the time of grant. Stock compensation expense recorded by the Company was $829,959 and $101,753 for the years ended December 31, 2014 and 2013, respectively, and is included in general and administrative expense in the statements of operations. | |||
Income Taxes | |||
The Company is a C corporation and federal and state income taxes are computed using the asset and liability method. Under the asset and liability method, deferred income tax assets and liabilities are recognized for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred income tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred income tax assets and liabilities of a change in tax rates is recognized in net income (loss) in the period that includes the enactment date. | |||
Uncertain Tax Positions | |||
The Company recognizes the financial statement amount of an uncertain tax position only after considering the probability that a tax authority would sustain the position in an examination. For tax positions meeting a “more likely-than-not” threshold, the amount recognized in the financial statements is the amount expected to be realized upon settlement with the tax authority. For tax positions not meeting the threshold, no financial statement benefit is recognized. The Company recognizes interest and penalties, if any, related to uncertain tax positions as general and administrative expenses. The Company currently has no federal or state examinations in progress. The Company’s tax years subject to federal and state tax examination are 2011, 2012, 2013 and 2014. | |||
Research and Development Costs | |||
Research and development (R&D) costs, including research performed under contract by third parties, are expensed as incurred. Major components of R&D expenses consist of personnel costs including salaries and benefits, outside research services, consulting fees, lab supplies and materials, license fees, and facility-related expenses. R&D expenses recorded by the Company were $1,960,815 and $1,827,533 for the years ended December 31, 2014 and 2013, respectively. | |||
Net Loss Per Common Share | |||
Basic net income or loss per common share (Basic EPS) is computed by dividing net income or loss by the weighted average number of common shares outstanding. Diluted net income or loss per common share (Diluted EPS) is computed by dividing net income or loss by the sum of the weighted average number of common shares outstanding and the dilutive potential common share equivalents then outstanding. Potential dilutive common share equivalents consist of shares issuable upon the exercise of outstanding stock options and warrants to acquire common stock. | |||
Due to the fact that for all periods presented, the Company incurred net losses, potential dilutive common share equivalents as of December 31, 2014 and 2013, totaling 26,994,088 and 16,169,658, respectively, are not included in the calculation of Diluted EPS because they are anti-dilutive. Therefore, basic loss per common share is the same as diluted loss per common share for the years ended December 31, 2014 and 2013. | |||
Recent Accounting Pronouncements | |||
In May 2014, the Financial Accounting Standards Board (FASB) issued ASU 2014-09, Revenue from Contracts with Customers. ASU 2014-09 provides for a single, principles-based model for revenue recognition that replaces existing revenue recognition guidance. ASU 2014-09 is effective for annual and interim periods beginning on or after December 15, 2016. It permits the use of either a retrospective or cumulative effect transition method and early adoption is not permitted. The Company has not yet determined the impact this standard will have on its consolidated financial statements and related disclosures. | |||
In June 2014, the FASB issued ASU 2014-10, Topic 915, Development Stage Entities, Elimination of Certain Financial Reporting Requirements. ASU 2014-10 removes all incremental financial reporting requirements for development stage entities, including but not limited to, inception-to-date financial information included in the statements of operations, statements of stockholders’ deficit and statements of cash flows. The Company elected early adoption of ASU 2014-10 beginning with the reporting period ended June 30, 2014. As a result of the Company’s early adoption, all references to the Company as a development stage entity have been removed. The adoption of this pronouncement had no impact on the Company’s financial position, results of operations or liquidity. | |||
In August 2014, the FASB issued ASU 2014-15, Presentation of Financial Statements – Going Concern (Subtopic 310-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern. ASU 2014-15 provides guidance in US GAAP about management’s responsibility to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern and to provide related disclosures. In doing so, this is intended to reduce diversity in the timing and content of disclosures. This is effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. Early application is permitted. The Company is currently evaluating the potential impact of adopting this guidance on its consolidated financial statements and related disclosures. | |||
Subsequent Events | |||
The Company has evaluated all subsequent events through the issuance date of the financial statements. | |||
Property_and_Equipment
Property and Equipment | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Property and Equipment [Abstract] | |||||||||
Property and Equipment | 3 | Property and Equipment | |||||||
Property and equipment consist of the following: | |||||||||
December 31, 2014 | December 31, 2013 | ||||||||
Lab equipment | $ | 329,406 | $ | 321,172 | |||||
Computers and software | 67,739 | 67,739 | |||||||
Leasehold improvements | 38,934 | 38,934 | |||||||
Office equipment and furniture | 3,647 | 3,647 | |||||||
439,726 | 431,492 | ||||||||
Less accumulated depreciation and amortization | (413,158 | ) | (403,493 | ) | |||||
Property and equipment, net | $ | 26,568 | $ | 27,999 | |||||
Depreciation and amortization expense for the years ended December 31, 2014 and 2013 was $9,665 and $11,847, respectively. |
Accounts_Payable
Accounts Payable | 12 Months Ended | |
Dec. 31, 2014 | ||
Accounts Payable [Abstract] | ||
Accounts Payable | 4 | Accounts Payable |
Between March 7, 2014 and June 30, 2014, the Company settled $2,727,030 of accounts payable through the issuance of equity. |
Accrued_Compensation
Accrued Compensation | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Accrued Compensation [Abstract] | |||||||||
Accrued Compensation | 5 | Accrued Compensation | |||||||
Accrued compensation consists of the following: | |||||||||
December 31, 2014 | December 31, 2013 | ||||||||
Accrued wages | $ | 621,072 | $ | 278,393 | |||||
Accrued vacation | 84,681 | 75,557 | |||||||
Total accrued compensation | $ | 705,753 | $ | 353,950 | |||||
Accrued wages consists primarily of salaries and related employment taxes resulting from the decision in March 2013 by certain of the Company’s executives to defer part, or all, of their salaries until additional funding for the Company is obtained. |
Notes_Payable
Notes Payable | 12 Months Ended | |
Dec. 31, 2014 | ||
Notes Payable [Abstract] | ||
Notes Payable | 6 | Notes Payable |
Between August 12 and September 30, 2013, the Company received $250,000 in cash proceeds from a bridge financing from certain note holders, some of which were affiliates, as evidenced by promissory notes. The notes were issued at 50% of face value, bore interest at the rate of 8% per annum, and matured beginning February 5, 2014. As of June 30, 2014, all notes payable and associated interest had been converted into equity as part of the 2014 Financing Transactions (see Note 2). | ||
The effective interest rate related to this financing is approximately 156%. |
Derivative_Liabilities
Derivative Liabilities | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Derivative Liabilities [Abstract] | |||||||||||||||||
Derivative Liabilities | 7 | Derivative Liabilities | |||||||||||||||
In connection with the 2014 Financing Transactions, the Company recorded derivative liabilities related to down-round protection provided to the stockholders in the event that the Company does another offering of units, similar to those issued in the 2014 Financing Transactions, at a price below $1.00 per share. The down-round provision expires upon the earlier of the effectiveness of a registration statement with the SEC or one year after the issuance date. With the assistance of a third-party valuation specialist, the Company valued the derivative liabilities pursuant to the accounting guidance of ASC 820-10, Fair Value Measurements. | |||||||||||||||||
Fair values for warrants and common stock are determined using the Monte-Carlo Simulation Model valuation technique. The Monte-Carlo Simulation Model provides for dynamic assumptions regarding volatility and risk-free interest rates within the total period to expected conversion. In addition, management assessed the probabilities of future financing assumptions. | |||||||||||||||||
Fair value is based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In order to increase consistency and comparability in fair value measurements, US GAAP establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three broad levels, which are described below: | |||||||||||||||||
Level 1 | Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. | ||||||||||||||||
Level 2 | Other inputs that are observable directly or indirectly, such as quoted prices for similar assets and liabilities or market corroborated inputs. | ||||||||||||||||
Level 3 | Unobservable inputs that are used when little or no market data is available, which require the Company to develop its own assumptions about how market participants would value the assets or liabilities. | ||||||||||||||||
Determining which category an asset or liability falls within the hierarchy requires significant judgment. The Company evaluates its hierarchy disclosure each quarter. Assets and liabilities measured at fair value on a recurring basis as of December 31, 2014 are summarized as follows: | |||||||||||||||||
Fair Value as of December 31, 2014 | |||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||
Derivative liabilities | $ | — | $ | — | $ | 32,175 | $ | 32,175 | |||||||||
The following table presents the reconciliation of Level 3 liabilities measured at fair value on a recurring basis during the year ended 2014. | |||||||||||||||||
Fair Value | |||||||||||||||||
Measurements | |||||||||||||||||
Using Significant | |||||||||||||||||
Unobservable Inputs | |||||||||||||||||
(Level 3) | |||||||||||||||||
Derivatives | |||||||||||||||||
Beginning balance, as of December 31, 2013 | $ | — | |||||||||||||||
Issuances: | |||||||||||||||||
Derivative liabilities related to down-round provision of common stock and warrants | 166,194 | ||||||||||||||||
Gain on derivative liabilities | (134,019 | ) | |||||||||||||||
Ending balance, as of December 31, 2014 | $ | 32,175 | |||||||||||||||
Given the nature of the derivative liabilities, the carrying amount of $32,175 as of December 31, 2014 was derived from Level 3 inputs and represents management’s best estimate of fair value. | |||||||||||||||||
The valuation assumptions used in the Monte-Carlo Simulation Model for the year ended December 31, 2014 are as follows: | |||||||||||||||||
Threshold barrier | $1.00 | ||||||||||||||||
Average down-round protection value per unit | $.06 - $.1714 | ||||||||||||||||
Probability of down-round offer | 3% - 10% | ||||||||||||||||
Stockholders_Equity
Stockholders' Equity | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Stockholders' Equity [Abstract] | |||||||||||||||||
Stockholders' Equity | 8 | Stockholders’ Equity | |||||||||||||||
Common Stock | |||||||||||||||||
As of December 31, 2014, the Company is authorized to issue 100,000,000 shares of common stock, of which 30,477,460 shares were outstanding. Outstanding options and warrants for 26,944,088 shares of common stock existed as of December 31, 2014. | |||||||||||||||||
Holders of shares of common stock are entitled to cast one vote for each share held at all stockholders’ meetings for all purposes, including the election of directors. The common stock does not have cumulative voting rights. | |||||||||||||||||
Preferred Stock | |||||||||||||||||
As of December 31, 2014, the Company was authorized to issue 10,000,000 shares of preferred stock; however, no shares of preferred stock have been issued to date. | |||||||||||||||||
Stock Options | |||||||||||||||||
2002 Stock Option Plan | |||||||||||||||||
In April 2002, the Board of Directors approved the Q Therapeutics 2002 Stock Incentive Plan (the 2002 Plan) and in February 2003, the stockholders approved the 2002 Plan. The 2002 Plan permits the grant of incentive stock options, non-qualified stock options and restricted stock. | |||||||||||||||||
All but 228,472 options available for award under the 2002 Plan have been granted. On December 6, 2011, the Board of Directors authorized the addition of the 228,472 shares available but unissued pursuant to the 2002 Plan to the authorized/reserved option pool for the 2011 Plan (discussed below). As of December 31, 2014, 2,874,706 options had been issued and remained outstanding under the 2002 Plan. | |||||||||||||||||
2011 Equity Incentive Compensation Plan | |||||||||||||||||
In connection with the Merger, on October 13, 2011, the Board of Directors and stockholders approved the Q Therapeutics, Inc. 2011 Equity Incentive Compensation Plan (the 2011 Plan). Subject to the provisions of the 2011 Plan, a designated committee (Committee) of the Board of Directors (or if none, the Board of Directors itself) may, from time to time, in its sole discretion select from among eligible employees, non-employee directors and consultants those to whom awards shall be granted under the 2011 Plan, and shall determine in its discretion the nature, terms, conditions and amount of each award, subject to the terms of the 2011 Plan. The term of the 2011 Plan commenced on October 13, 2011 (the Effective Date) and remains in effect, subject to the right of the Committee or the Board to amend or terminate the 2011 Plan at any time pursuant to the 2011 Plan, until the earlier of (i) the tenth anniversary of the Effective Date, or (ii) all shares subject to the 2011 Plan have been purchased or acquired according to the 2011 Plan’s provisions. | |||||||||||||||||
The 2011 Plan initially provided for a reservation pool of up to 1,500,000 shares of common stock reserved for issuance pursuant to the 2011 Plan. On December 6, 2011, the Board of Directors authorized the addition of the remaining 228,472 shares available but unissued pursuant to the 2002 Plan to the authorized/reserved option pool for the 2011 Plan, bringing the 2011 Plan pool to 1,728,472 shares of common stock reserved for issuance. The Board of Directors also resolved to roll over all forfeited or expired awards made under the 2002 Plan into the 2011 Plan. As of December 31, 2014, 149,057 expired options issued under the 2002 Plan had been rolled into the 2011 Plan. | |||||||||||||||||
On December 18, 2012, the Board of Directors approved, subject to stockholder approval, the addition of 3,000,000 shares to the 2011 Plan. On May 6, 2013, the stockholders approved the additional 3,000,000 shares under the Plan, increasing the number of shares from 1,877,529 to 4,877,529. | |||||||||||||||||
On December 18, 2014, the Board of Directors and stockholders approved the addition of 6,250,000 shares to the 2011 Plan, increasing the number of shares from 4,877,529 to 11,127,529. In an effort to increase employee retention and morale, the Company offered its employees the opportunity to have certain outstanding options issued in 2012 modified by reducing the grant exercise price of $1.00 to $.70, which was the fair market value of the common stock as of the modification date. No other terms of the options were modified. As a result, the exercise price of 890,000 options held in aggregate by 10 employees to purchase common stock was modified and the incremental expense of $57,761 resulting from the modification is being to be amortized through December 31, 2015. | |||||||||||||||||
As of December 31, 2014, 6,078,221 options had been issued under the 2011 Plan with 5,049,308 options available for future grant. | |||||||||||||||||
The following sets forth all outstanding common stock options and related activity for the years ended December 31, 2014 and 2013: | |||||||||||||||||
Number | Weighted | Weighted | Aggregate | ||||||||||||||
of | Average | Average | Intrinsic | ||||||||||||||
Options | Exercise | Remaining | Value | ||||||||||||||
Outstanding | Price | Contractual | |||||||||||||||
Life (Years) | |||||||||||||||||
Outstanding as of December 31, 2012 | 3,865,440 | $ | 0.34 | 6.94 | $ | 2,549,625 | |||||||||||
Granted | — | — | |||||||||||||||
Exercised | — | — | |||||||||||||||
Forfeited | — | — | |||||||||||||||
Outstanding as of December 31, 2013 | 3,865,440 | 0.34 | 6.06 | 2,549,625 | |||||||||||||
Granted | 5,188,221 | 0.7 | |||||||||||||||
Exercised | (100,734 | ) | 0.15 | ||||||||||||||
Forfeited | — | — | |||||||||||||||
Outstanding as of December 31, 2014 | 8,952,927 | 0.55 | 6.97 | 1,601,845 | |||||||||||||
Options vested and exercisable as of December 31, 2014 | 5,773,344 | 0.42 | 6.69 | 1,601,845 | |||||||||||||
In 2014, the Company received proceeds of $15,366 from the exercise of options. The Company issues shares of common stock upon receipt of the recipient’s exercise notification and payment. | |||||||||||||||||
A summary of the activity for unvested option awards for the year ended December 31, 2014: | |||||||||||||||||
Number | Weighted | ||||||||||||||||
of | Average | ||||||||||||||||
Options | Grant Date | ||||||||||||||||
Fair Value | |||||||||||||||||
Non-vested options as of December 31, 2013 | 424,167 | $ | 0.62 | ||||||||||||||
Granted | 5,188,221 | 0.45 | |||||||||||||||
Vested | (2,432,805 | ) | 0.41 | ||||||||||||||
Forfeited | — | — | |||||||||||||||
Non-vested options as of December 31, 2014 | 3,179,583 | 0.5 | |||||||||||||||
The Company determines the expected term of its stock option awards by using the simplified method, which assumes each vesting tranche of the award has a term equal to the midpoint between when the award vests and when the award expires. Expected volatility is calculated by weighting the stock price of similar industry segment public companies equivalent to the expected term of each grant. The risk-free interest rate for the expected term of each option granted is based on the U.S. Treasury securities rate in effect at the time of the grant with the period that approximates the expected term of the option. | |||||||||||||||||
The aggregate intrinsic value of outstanding stock options and the aggregate intrinsic value of outstanding exercisable stock options as of December 31, 2014 was $1,601,845. The total fair value of equity awards that vested during fiscal year 2014 was $1,702,963. This total fair value includes equity-based awards issued in the form of stock options, stock-settled stock appreciation rights, and deferred stock units. | |||||||||||||||||
Stock-based compensation for the years ended December 31, 2014 and 2013 was $829,959 and $101,753, respectively. As of December 31, 2014, the Company had $1,282,743 of unrecognized stock-based compensation expense related to non-vested awards that will be recognized over a weighted average period of 2.95 years. | |||||||||||||||||
Warrants | |||||||||||||||||
The following sets forth outstanding warrants and related activity for the years ended December 31, 2014 and 2013, all of which are exercisable: | |||||||||||||||||
Number | Weighted | Weighted | Intrinsic | ||||||||||||||
of | Average | Average | Value | ||||||||||||||
Warrants | Exercise | Remaining | |||||||||||||||
Price | Life | ||||||||||||||||
Per Share | in Years | ||||||||||||||||
Outstanding as of December 31, 2012 | 11,979,518 | $ | 1.4 | 5.52 | $ | 216,710 | |||||||||||
Granted | 325,000 | 1.77 | — | — | |||||||||||||
Exercised | — | — | — | — | |||||||||||||
Forfeited | — | — | — | — | |||||||||||||
Outstanding and exercisable as of December 31, 2013 | 12,304,518 | 1.41 | 4.44 | 216,710 | |||||||||||||
Granted | 5,749,143 | 1 | — | — | |||||||||||||
Exercised | — | — | — | — | |||||||||||||
Forfeited | (62,500 | ) | 1.25 | — | — | ||||||||||||
Outstanding and exercisable as of December 31, 2014 | 17,991,161 | 1.28 | 3.41 | 216,710 | |||||||||||||
The following presents information related to outstanding warrants as of December 31, 2014, all of which are exercisable: | |||||||||||||||||
Warrants Outstanding and Exercisable | |||||||||||||||||
Exercise Price | Number of Warrants | Weighted Average | |||||||||||||||
Remaining Life in | |||||||||||||||||
Years | |||||||||||||||||
$ | 0.05 | 132,797 | 0.1 | ||||||||||||||
0.53 | 192,242 | 0.1 | |||||||||||||||
1 | 11,542,584 | 3.6 | |||||||||||||||
1.01 | 125,000 | 3.8 | |||||||||||||||
1.04 | 823,347 | 0.1 | |||||||||||||||
1.2 | 43,000 | 2 | |||||||||||||||
1.75 | 4,944,691 | 0.3 | |||||||||||||||
2 | 62,500 | 3.9 | |||||||||||||||
2.25 | 62,500 | 0.5 | |||||||||||||||
2.75 | 62,500 | 0.8 | |||||||||||||||
17,991,161 | |||||||||||||||||
Between January 26 and February 13, 2015, 327,455 warrants were exercised for total cash proceeds of $110,831. On February 14, 2015, 820,931 warrants expired. | |||||||||||||||||
Commitments_and_Contingencies
Commitments and Contingencies | 12 Months Ended | |
Dec. 31, 2014 | ||
Commitments and Contingencies Disclosure [Abstract] | ||
Commitments and Contingencies | 9 | Commitments |
Employee Agreements | ||
The Company has entered into employment and proprietary rights agreements with all of its employees. These agreements stipulate that employment is on an at-will basis and outline salary, benefits, non-disclosure of confidential information, restrictions and assignment of intellectual property to the Company. | ||
The Company has employment agreements with its CEO and CFO that specify compensation, benefits and vacation. These agreements address severance for termination of employment and have provisions if a change of control occurs. | ||
License and Royalty Agreements | ||
The Company has entered into an exclusive license agreement with a university, through which the Company has obtained certain intellectual property from the university to commercialize, produce, manufacture, use and sell products. The Company is required to pay the university a contractual dollar amount for each new investigational drug application filed with the FDA using the licensed intellectual property. Should the Company receive cash payments from licensing revenue during human trial research, the Company is required to pay 25% of all net licensing revenue (but not including payments for product development activities or equity purchases) to the university up to a certain maximum amount. The Company is also required to pay an amount upon New Drug Application (NDA) approval. The NDA approval occurs when the FDA has approved all prior drug testing and allows a new drug to go to market. Once the Company has an NDA, the Company must pay the university a royalty of 2% of net sales up to a certain dollar amount, 2.5% of net sales in excess of that amount of human therapeutics, and a royalty of 5% of net sales on any services. If the Company sublicenses the intellectual property, then the Company must pay the university in accordance with the provisions of the agreement. | ||
In March 2014, the Company entered into a license agreement with a company (the licensor) whereby the Company was granted use of the licensor’s technology. Should any patents be filed in conjunction with this technology, the Company would be granted a non-exclusive, worldwide, perpetual, royalty-free fully paid license to utilize the technology. In exchange for the technology, the licensor will receive a license for manufacturing related technology from the Company and up to 110,000 shares of common stock upon the completion of certain milestones. Additionally, any sales generated from the licensor’s technology will result in a 5% royalty to the licensor. As of December 31, 2014, the licensor has been issued 65,000 shares of common stock. | ||
Collaborative Arrangements | ||
From time to time, the Company enters into collaborative arrangements for research and development, manufacture and/or commercialization of product and product candidates. These collaborations can provide for non-refundable, upfront license fees, R&D and commercial performance milestones, cost sharing, and royalty payments. The Company’s collaboration agreements with outside parties are performed on a “best efforts” basis with no guarantees of success. | ||
In September 2013, the Company executed an agreement to acquire a non-exclusive, worldwide, perpetual, royalty free technology license. In consideration for this license, the Company issued 100,000 shares of the Company’s common stock. Should the Company sublicense the technology to a third party, the Company is required to compensate the licensor 10% of the upfront fees. The agreement is in place for 10 years from the effective date of the agreement or the life of the patents, whichever is longer. | ||
Supplier Agreements | ||
In March 2010, the Company entered into a service agreement with an outside research firm to support the Company’s submission of an investigational new drug application (IND) to the FDA. On March 7, 2014, the Company paid for certain services by issuing 2,185,330 shares of common stock and a warrant to purchase 2,185,330 shares of common stock. | ||
In June 2014, the Company entered into a new agreement with the research firm in which the Company has the option to pay up to $500,000 of a pre-clinical study with equity. For each dollar in expense, the Company had the option to pay the research firm with one share of common stock and one warrant to purchase two shares of common stock. The warrants have an exercise price of $1.00, have a four-year life, and are immediately exercisable. Further, at the Company’s discretion, the Company may elect to pay for the services in cash. For each dollar paid in cash, the Company would issue the research firm a warrant to purchase one share of the Company’s common stock with similar terms as stated above. Any amount in excess of this limit, could be converted into a note payable upon completion of the study. Interest would accrue at 8% annually until August 1, 2015 when the interest rate would increase to 10% through the maturity date of the note of March 31, 2016. | ||
Advisory Agreements | ||
On October 1, 2012, the Company entered into an agreement with an investor relations firm. In lieu of cash, the firm received 200,000 shares of restricted stock for services rendered between October 2012 through October 2014. As of October 31, 2014, the service agreement was terminated. Additionally, 250,000 warrants were granted from January 1, 2013 through October 1, 2013 with exercise prices ranging between $1.25 and $2.75. As of December 31, 2014, 62,500 of these warrants have expired. | ||
In July 2013, the Company entered into a business consulting services agreement effective through December 31, 2015. Under the agreement, the Company issued three warrants to purchase up to 175,000 shares of common stock at a strike price of $1.01 per share, with a five-year life and a no call provision. All warrants are immediately exercisable. | ||
Operating Leases | ||
The Company leases its research and office facility under an operating lease which expires March 31, 2016. Lease expense under operating leases was $160,001 and $152,098 for the years ended December 31, 2014 and 2013, respectively. Future minimum lease payments are approximately $123,891 and $41,297 for the years ended December 31, 2015 and 2016, respectively. |
Income_Taxes
Income Taxes | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Income Taxes [Abstract] | |||||||||
Income Taxes | 10 | Income Taxes | |||||||
The benefit for income taxes differs from the amount computed at federal statutory rates as follows for the years ended December 31: | |||||||||
2014 | 2013 | ||||||||
Federal income tax at statutory rates | $ | (1,139,136 | ) | $ | (1,152,292 | ) | |||
State income tax at statutory rates | (99,401 | ) | (108,575 | ) | |||||
Research and development credits | (89,692 | ) | (161,935 | ) | |||||
Change in valuation allowance | 1,143,266 | 1,389,156 | |||||||
Other | 184,963 | 33,646 | |||||||
$ | — | $ | — | ||||||
Significant components of the Company’s deferred income tax assets (liabilities) are as follows as of December 31: | |||||||||
2014 | 2013 | ||||||||
Current: | |||||||||
Accruals and reserves | $ | 271,219 | $ | 140,274 | |||||
Non-qualified stock options and other | 24,351 | — | |||||||
Change in valuation allowance | (295,570 | ) | (140,274 | ) | |||||
$ | — | $ | — | ||||||
Long-term: | |||||||||
Net operating loss carryforwards | $ | 8,805,743 | $ | 8,064,635 | |||||
Depreciation and amortization | (339 | ) | (358 | ) | |||||
Non-qualified stock options and other | 227,944 | 70,605 | |||||||
Research and development credits | 884,477 | 794,750 | |||||||
Valuation allowance | (9,917,825 | ) | (8,929,632 | ) | |||||
$ | — | $ | — | ||||||
As of December 31, 2014, the Company had net operating loss (NOL) carryforwards available to offset future taxable income, if any, of approximately $23,608,000, which will begin to expire in 2022. | |||||||||
The Company has research and development credits totaling $884,477 available for offset against future federal income tax, if any. The credits begin to expire in 2022. | |||||||||
The utilization of the NOL carryforwards is subject to annual limitations under Section 382 of the Internal Revenue Code. Section 382 imposes limitations on a corporation’s ability to utilize its NOL carryforwards if it experiences an “ownership change.” In general terms, an ownership change results from transactions increasing the ownership of certain stockholders in the stock of a corporation by more than 50% over a three-year period. | |||||||||
The Company has concluded that there are no significant uncertain tax positions requiring disclosure. |
Benefit_Plans
Benefit Plans | 12 Months Ended | |
Dec. 31, 2014 | ||
Benefit Plans [Abstract] | ||
Benefit Plans | ||
12 | Benefit Plan | |
The Company sponsors a defined contribution 401(k) retirement plan (the Plan). Employees who are 18 years of age or older are eligible to participate in the Plan. Employees may elect to contribute to the Plan up to 100% of their annual compensation, up to the maximum amount allowed by the Internal Revenue Service. | ||
The Company may elect to match part of employee contributions, make a profit sharing contribution, or a non-qualified contribution at its discretion. The Company elected to make non–qualified contributions of $20,549 and $15,144 to the Plan for the years ended December 31, 2014 and 2013, respectively. |
RelatedParty_Transactions
Related-Party Transactions | 12 Months Ended | |
Dec. 31, 2014 | ||
Related Party Transactions [Abstract] | ||
Related-Party Transactions | 13 | Related-Party Transactions |
Between August 12 and September 30, 2013, the Company received in aggregate $200,000 in cash proceeds from a bridge financing by an officer and an affiliate as evidenced by promissory notes. The notes were issued at 50% of face value, bore interest at a rate of 8% per annum, and matured beginning February 5, 2014. The officer transferred his ownership to the affiliate, of which the officer is a managing partner, in 2013. In February 2014, the affiliate agreed to extend the maturity date of its note for an additional 180 days in exchange for certain call rights language being removed from warrants the affiliate had acquired in 2011. In June 2014, the affiliate converted its notes totaling $427,863, including interest, into units of one share of common stock and one warrant to purchase a share of common stock. |
Subsequent_Events
Subsequent Events | 12 Months Ended | |
Dec. 31, 2014 | ||
Subsequent Events [Abstract] | ||
Subsequent Events | 14 | Subsequent Events |
Between January 26, 2015 and February 23, 2015, 327,455 warrants and 21,634 options were exercised for cash proceeds of $114,131. |
Significant_Accounting_Policie1
Significant Accounting Policies (Policies) | 12 Months Ended | ||
Dec. 31, 2014 | |||
Significant Accounting Policies [Abstract] | |||
Basis of Presentation and Consolidation, Policy | Basis of Presentation and Consolidation | ||
The accompanying consolidated financial statements have been prepared by management in accordance with U.S. generally accepted accounting principles (US GAAP), and include all assets and liabilities of the Company and its wholly owned subsidiary, Q Therapeutic Products, Inc. All material transactions and balances have been eliminated. | |||
Going Concern Assumption and Liquidity, Policy | Going Concern Assumption and Liquidity | ||
The Company has not generated significant revenues and has been developing its products. Historically, the Company has been dependent on government grants and debt and equity raised from individual investors to sustain its operations. The Company’s continued operations will depend on its ability to raise funds through similar sources. There can be no assurance that such capital will be available on favorable terms or at all. If it is unable to raise additional capital, the Company will likely be forced to curtail desired development activities, which will delay the development of its product candidates. The Company’s products have not been approved by the U.S. Food and Drug Administration (FDA) for commercial sale; therefore, the Company has not generated revenues from commercial therapeutic product sales. | |||
The Company has incurred losses and has negative cash flows from operating activities. As of December 31, 2014, the Company had an accumulated deficit of $27,232,071, a stockholders’ deficit of $295,852, and negative working capital of $322,420. | |||
These uncertainties create substantial doubt about the Company’s ability to continue as a going concern. The Company’s financial statements have been prepared on a basis which assumes that the Company will continue as a going concern, which contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of business. The accompanying financial statements do not include any adjustments that may result from the outcome of this uncertainty. | |||
Use of Estimates, Policy | Use of Estimates | ||
The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the dates of the financial statements and the reported amounts of the revenues and expenses for the reporting periods. Accordingly, actual results could differ from those estimates. Key estimates include allowances for doubtful accounts receivable, useful lives for property and equipment, valuation allowances for net deferred income tax assets, and valuations for stock-based compensation awards. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. | |||
Revenue Recognition and Grants Receivable, Policy | Revenue Recognition and Receivables | ||
The Company periodically applies for research grants, generally as a sub-recipient to grants funded by government agencies through research institutions. Grant revenues are recognized as associated expenses are incurred and are billed in conjunction with the terms of the grants. The Company records its grants receivable in accordance with the provisions of the grant agreements. The Company’s grants receivable are considered past due when payment has not been received within 30 days of the invoice date, although certain institutions customarily do not pay within these terms. The amounts of the specific allowances are estimated by management based on various assumptions including the age of the individual receivable, and changes in payment schedules and histories. Receivable balances are charged off against the allowance for doubtful accounts when management determines the probability of collection is remote. Recoveries of receivables previously charged off are recorded when payment is received. Revenue earned in 2014 was derived from two customers. The Company did not incur any losses relating to bad debts associated with grant revenues for the years ended December 31, 2014 and 2013. | |||
In June 2014, the Company was notified of a sub-award as part of the fourth and final year of grant funding awarded to The Johns Hopkins University from the National Institute of Neurological Disorders and Stroke (NINDS) of the National Institutes of Health in the amount of $677,864. As of December 31, 2014, $4,136 remains receivable from this sub-award. | |||
Concentration of Suppliers, Policy | Concentration of Suppliers | ||
The Company has entered and will enter into agreements with outside research facilities to assist in the clinical research, monitoring, and reporting of its pilot and clinical studies. In some instances, the Company is dependent upon a single supplier. The loss of key suppliers could have a material adverse effect upon the Company’s operations by interrupting or delaying the progress or completion of the Company’s clinical trials. | |||
For the year ended December 31, 2014, one supplier accounted for approximately 61.4% of the Company’s research and development purchases. | |||
Property and Equipment, Policy | Property and Equipment | ||
Property and equipment are stated at cost less accumulated depreciation and amortization. Depreciation and amortization are calculated using the straight-line method over the estimated economic useful lives of the assets as follows: | |||
Lab equipment | 5 years | ||
Computers and software | 3 years | ||
Leasehold improvements | 7 years | ||
Office equipment and furniture | 3 years | ||
Expenditures that materially increase values or capacities or extend useful lives of property and equipment are capitalized. Routine maintenance and repairs are expensed as incurred. Upon sale or other retirement of depreciable property, the cost and accumulated depreciation are removed from the related accounts and any gain or loss is reflected in the statements of operations. | |||
Impairment of Long-Lived Assets, Policy | Impairment of Long-Lived Assets | ||
The Company reviews its property, equipment, and other long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amounts of the assets may be impaired. Management does not consider any of the Company’s assets to be impaired as of December 31, 2014 and 2013. | |||
Leases, Policy | Leases | ||
The Company leases its research and office facility under an operating lease. The current lease expires on March 31, 2016. If rent escalations in the new lease are material, the Company will record the total rent payable during the lease term on a straight-line basis over the term of the lease. The Company will record any difference between the rent paid and the straight-line rent as a deferred rent liability. | |||
Stock-Based Compensation, Policy | Stock-Based Compensation | ||
The Company calculates the estimated fair value of its stock options and warrants on the grant date using the Black-Scholes option-pricing model. The Company recognizes stock-based compensation expense as services are provided, which is generally over the vesting period of the individual equity instruments. Expense related to stock options issued in lieu of cash to non-employees for services performed are measured at the fair value of the options on the date they are earned and the related expense is recognized as services are provided. | |||
The volatility assumption used in the Black-Scholes option-pricing model is based on the volatility of publicly traded companies in the same industry segment as the Company. The expected lives of the options and warrants granted represent the periods of time that the options granted are expected to be outstanding. The risk free rates for periods within the contractual lives of the options and warrants are based on the U.S. Treasury securities constant maturity rate that corresponds to the expected terms in effect at the time of grant. Stock compensation expense recorded by the Company was $829,959 and $101,753 for the years ended December 31, 2014 and 2013, respectively, and is included in general and administrative expense in the statements of operations. | |||
Income Taxes, Policy | Income Taxes | ||
The Company is a C corporation and federal and state income taxes are computed using the asset and liability method. Under the asset and liability method, deferred income tax assets and liabilities are recognized for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred income tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred income tax assets and liabilities of a change in tax rates is recognized in net income (loss) in the period that includes the enactment date. | |||
Uncertain Tax Positions, Policy | Uncertain Tax Positions | ||
The Company recognizes the financial statement amount of an uncertain tax position only after considering the probability that a tax authority would sustain the position in an examination. For tax positions meeting a “more likely-than-not” threshold, the amount recognized in the financial statements is the amount expected to be realized upon settlement with the tax authority. For tax positions not meeting the threshold, no financial statement benefit is recognized. The Company recognizes interest and penalties, if any, related to uncertain tax positions as general and administrative expenses. The Company currently has no federal or state examinations in progress. The Company’s tax years subject to federal and state tax examination are 2011, 2012, 2013 and 2014. | |||
Research and Development Costs, Policy | Research and Development Costs | ||
Research and development (R&D) costs, including research performed under contract by third parties, are expensed as incurred. Major components of R&D expenses consist of personnel costs including salaries and benefits, outside research services, consulting fees, lab supplies and materials, license fees, and facility-related expenses. R&D expenses recorded by the Company were $1,960,815 and $1,827,533 for the years ended December 31, 2014 and 2013, respectively. | |||
Net Loss Per Common Share, Policy | Net Loss Per Common Share | ||
Basic net income or loss per common share (Basic EPS) is computed by dividing net income or loss by the weighted average number of common shares outstanding. Diluted net income or loss per common share (Diluted EPS) is computed by dividing net income or loss by the sum of the weighted average number of common shares outstanding and the dilutive potential common share equivalents then outstanding. Potential dilutive common share equivalents consist of shares issuable upon the exercise of outstanding stock options and warrants to acquire common stock. | |||
Due to the fact that for all periods presented, the Company incurred net losses, potential dilutive common share equivalents as of December 31, 2014 and 2013, totaling 26,994,088 and 16,169,658, respectively, are not included in the calculation of Diluted EPS because they are anti-dilutive. Therefore, basic loss per common share is the same as diluted loss per common share for the years ended December 31, 2014 and 2013. | |||
Recent Accounting Pronouncements, Policy | Recent Accounting Pronouncements | ||
In May 2014, the Financial Accounting Standards Board (FASB) issued ASU 2014-09, Revenue from Contracts with Customers. ASU 2014-09 provides for a single, principles-based model for revenue recognition that replaces existing revenue recognition guidance. ASU 2014-09 is effective for annual and interim periods beginning on or after December 15, 2016. It permits the use of either a retrospective or cumulative effect transition method and early adoption is not permitted. The Company has not yet determined the impact this standard will have on its consolidated financial statements and related disclosures. | |||
In June 2014, the FASB issued ASU 2014-10, Topic 915, Development Stage Entities, Elimination of Certain Financial Reporting Requirements. ASU 2014-10 removes all incremental financial reporting requirements for development stage entities, including but not limited to, inception-to-date financial information included in the statements of operations, statements of stockholders’ deficit and statements of cash flows. The Company elected early adoption of ASU 2014-10 beginning with the reporting period ended June 30, 2014. As a result of the Company’s early adoption, all references to the Company as a development stage entity have been removed. The adoption of this pronouncement had no impact on the Company’s financial position, results of operations or liquidity. | |||
In August 2014, the FASB issued ASU 2014-15, Presentation of Financial Statements – Going Concern (Subtopic 310-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern. ASU 2014-15 provides guidance in US GAAP about management’s responsibility to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern and to provide related disclosures. In doing so, this is intended to reduce diversity in the timing and content of disclosures. This is effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. Early application is permitted. The Company is currently evaluating the potential impact of adopting this guidance on its consolidated financial statements and related disclosures. | |||
Subsequent Events, Policy | Subsequent Events | ||
The Company has evaluated all subsequent events through the issuance date of the financial statements. |
Significant_Accounting_Policie2
Significant Accounting Policies (Tables) | 12 Months Ended | ||
Dec. 31, 2014 | |||
Significant Accounting Policies [Abstract] | |||
Schedule of Useful Lives of Property and Equipment | Depreciation and amortization are calculated using the straight-line method over the estimated economic useful lives of the assets as follows: | ||
Lab equipment | 5 years | ||
Computers and software | 3 years | ||
Leasehold improvements | 7 years | ||
Office equipment and furniture | 3 years | ||
Property_and_Equipment_Tables
Property and Equipment (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Property and Equipment [Abstract] | |||||||||
Schedule of Property and Equipment | Property and equipment consist of the following: | ||||||||
December 31, 2014 | December 31, 2013 | ||||||||
Lab equipment | $ | 329,406 | $ | 321,172 | |||||
Computers and software | 67,739 | 67,739 | |||||||
Leasehold improvements | 38,934 | 38,934 | |||||||
Office equipment and furniture | 3,647 | 3,647 | |||||||
439,726 | 431,492 | ||||||||
Less accumulated depreciation and amortization | (413,158 | ) | (403,493 | ) | |||||
Property and equipment, net | $ | 26,568 | $ | 27,999 | |||||
Accrued_Compensation_Tables
Accrued Compensation (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Accrued Compensation [Abstract] | |||||||||
Schedule of Accrued Compensation | Accrued compensation consists of the following: | ||||||||
December 31, 2014 | December 31, 2013 | ||||||||
Accrued wages | $ | 621,072 | $ | 278,393 | |||||
Accrued vacation | 84,681 | 75,557 | |||||||
Total accrued compensation | $ | 705,753 | $ | 353,950 | |||||
Accrued wages consists primarily of salaries and related employment taxes resulting from the decision in March 2013 by certain of the Company’s executives to defer part, or all, of their salaries until additional funding for the Company is obtained. |
Derivative_Liabilities_Tables
Derivative Liabilities (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Derivative Liabilities [Abstract] | |||||||||||||||||
Schedule of Derivative Liabilities | Assets and liabilities measured at fair value on a recurring basis as of December 31, 2014 are summarized as follows: | ||||||||||||||||
Fair Value as of December 31, 2014 | |||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||
Derivative liabilities | $ | — | $ | — | $ | 32,175 | $ | 32,175 | |||||||||
Schedule of Derivative Liability Fair Value Unobservable Input Reconciliation | The following table presents the reconciliation of Level 3 liabilities measured at fair value on a recurring basis during the year ended 2014. | ||||||||||||||||
Fair Value | |||||||||||||||||
Measurements | |||||||||||||||||
Using Significant | |||||||||||||||||
Unobservable Inputs | |||||||||||||||||
(Level 3) | |||||||||||||||||
Derivatives | |||||||||||||||||
Beginning balance, as of December 31, 2013 | $ | — | |||||||||||||||
Issuances: | |||||||||||||||||
Derivative liabilities related to down-round provision of common stock and warrants | 166,194 | ||||||||||||||||
Gain on derivative liabilities | (134,019 | ) | |||||||||||||||
Ending balance, as of December 31, 2014 | $ | 32,175 | |||||||||||||||
Valuation Assumptions Used in Monte-Carlo Simulation Model | The valuation assumptions used in the Monte-Carlo Simulation Model for the year ended December 31, 2014 are as follows: | ||||||||||||||||
Threshold barrier | $1.00 | ||||||||||||||||
Average down-round protection value per unit | $.06 - $.1714 | ||||||||||||||||
Probability of down-round offer | 3% - 10% | ||||||||||||||||
Stockholders_Equity_Tables
Stockholders' Equity (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Stockholders' Equity [Abstract] | |||||||||||||||||
Summary of Outstanding Common Stock Options and Related Activity | The following sets forth all outstanding common stock options and related activity for the years ended December 31, 2014 and 2013: | ||||||||||||||||
Number | Weighted | Weighted | Aggregate | ||||||||||||||
of | Average | Average | Intrinsic | ||||||||||||||
Options | Exercise | Remaining | Value | ||||||||||||||
Outstanding | Price | Contractual | |||||||||||||||
Life (Years) | |||||||||||||||||
Outstanding as of December 31, 2012 | 3,865,440 | $ | 0.34 | 6.94 | $ | 2,549,625 | |||||||||||
Granted | — | — | |||||||||||||||
Exercised | — | — | |||||||||||||||
Forfeited | — | — | |||||||||||||||
Outstanding as of December 31, 2013 | 3,865,440 | 0.34 | 6.06 | 2,549,625 | |||||||||||||
Granted | 5,188,221 | 0.7 | |||||||||||||||
Exercised | (100,734 | ) | 0.15 | ||||||||||||||
Forfeited | — | — | |||||||||||||||
Outstanding as of December 31, 2014 | 8,952,927 | 0.55 | 6.97 | 1,601,845 | |||||||||||||
Options vested and exercisable as of December 31, 2014 | 5,773,344 | 0.42 | 6.69 | 1,601,845 | |||||||||||||
In 2014, the Company received proceeds of $15,366 from the exercise of options. The Company issues shares of common stock upon receipt of the recipient’s exercise notification and payment. | |||||||||||||||||
A summary of the activity for unvested option awards for the year ended December 31, 2014: | |||||||||||||||||
Number | Weighted | ||||||||||||||||
of | Average | ||||||||||||||||
Options | Grant Date | ||||||||||||||||
Fair Value | |||||||||||||||||
Non-vested options as of December 31, 2013 | 424,167 | $ | 0.62 | ||||||||||||||
Granted | 5,188,221 | 0.45 | |||||||||||||||
Vested | (2,432,805 | ) | 0.41 | ||||||||||||||
Forfeited | — | — | |||||||||||||||
Non-vested options as of December 31, 2014 | 3,179,583 | 0.5 | |||||||||||||||
The Company determines the expected term of its stock option awards by using the simplified method, which assumes each vesting tranche of the award has a term equal to the midpoint between when the award vests and when the award expires. Expected volatility is calculated by weighting the stock price of similar industry segment public companies equivalent to the expected term of each grant. The risk-free interest rate for the expected term of each option granted is based on the U.S. Treasury securities rate in effect at the time of the grant with the period that approximates the expected term of the option. | |||||||||||||||||
Schedule of Stock Warrants, Exercisable | The following sets forth outstanding warrants and related activity for the years ended December 31, 2014 and 2013, all of which are exercisable: | ||||||||||||||||
Number | Weighted | Weighted | Intrinsic | ||||||||||||||
of | Average | Average | Value | ||||||||||||||
Warrants | Exercise | Remaining | |||||||||||||||
Price | Life | ||||||||||||||||
Per Share | in Years | ||||||||||||||||
Outstanding as of December 31, 2012 | 11,979,518 | $ | 1.4 | 5.52 | $ | 216,710 | |||||||||||
Granted | 325,000 | 1.77 | — | — | |||||||||||||
Exercised | — | — | — | — | |||||||||||||
Forfeited | — | — | — | — | |||||||||||||
Outstanding and exercisable as of December 31, 2013 | 12,304,518 | 1.41 | 4.44 | 216,710 | |||||||||||||
Granted | 5,749,143 | 1 | — | — | |||||||||||||
Exercised | — | — | — | — | |||||||||||||
Forfeited | (62,500 | ) | 1.25 | — | — | ||||||||||||
Outstanding and exercisable as of December 31, 2014 | 17,991,161 | 1.28 | 3.41 | 216,710 | |||||||||||||
Schedule of Outstanding Stock Warrants | The following presents information related to outstanding warrants as of December 31, 2014, all of which are exercisable: | ||||||||||||||||
Warrants Outstanding and Exercisable | |||||||||||||||||
Exercise Price | Number of Warrants | Weighted Average | |||||||||||||||
Remaining Life in | |||||||||||||||||
Years | |||||||||||||||||
$ | 0.05 | 132,797 | 0.1 | ||||||||||||||
0.53 | 192,242 | 0.1 | |||||||||||||||
1 | 11,542,584 | 3.6 | |||||||||||||||
1.01 | 125,000 | 3.8 | |||||||||||||||
1.04 | 823,347 | 0.1 | |||||||||||||||
1.2 | 43,000 | 2 | |||||||||||||||
1.75 | 4,944,691 | 0.3 | |||||||||||||||
2 | 62,500 | 3.9 | |||||||||||||||
2.25 | 62,500 | 0.5 | |||||||||||||||
2.75 | 62,500 | 0.8 | |||||||||||||||
17,991,161 | |||||||||||||||||
Income_Taxes_Tables
Income Taxes (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Income Taxes [Abstract] | |||||||||
Schedule of Income Tax Benefit Reconcilliation | The benefit for income taxes differs from the amount computed at federal statutory rates as follows for the years ended December 31: | ||||||||
2014 | 2013 | ||||||||
Federal income tax at statutory rates | $ | (1,139,136 | ) | $ | (1,152,292 | ) | |||
State income tax at statutory rates | (99,401 | ) | (108,575 | ) | |||||
Research and development credits | (89,692 | ) | (161,935 | ) | |||||
Change in valuation allowance | 1,143,266 | 1,389,156 | |||||||
Other | 184,963 | 33,646 | |||||||
$ | — | $ | — | ||||||
Schedule of Deferred Tax Assets and Liabilities | Significant components of the Company’s deferred income tax assets (liabilities) are as follows as of December 31: | ||||||||
2014 | 2013 | ||||||||
Current: | |||||||||
Accruals and reserves | $ | 271,219 | $ | 140,274 | |||||
Non-qualified stock options and other | 24,351 | — | |||||||
Change in valuation allowance | (295,570 | ) | (140,274 | ) | |||||
$ | — | $ | — | ||||||
Long-term: | |||||||||
Net operating loss carryforwards | $ | 8,805,743 | $ | 8,064,635 | |||||
Depreciation and amortization | (339 | ) | (358 | ) | |||||
Non-qualified stock options and other | 227,944 | 70,605 | |||||||
Research and development credits | 884,477 | 794,750 | |||||||
Valuation allowance | (9,917,825 | ) | (8,929,632 | ) | |||||
$ | — | $ | — | ||||||
Organization_Narrative_Details
Organization (Narrative) (Details) | 12 Months Ended |
Dec. 31, 2014 | |
Q Therapeutic Products, Inc. [Member] | |
Entity Information [Line Items] | |
Date of incorporation (Date) | 28-Mar-02 |
Grace 2, Inc. [Member] | |
Entity Information [Line Items] | |
Date of incorporation (Date) | 27-Oct-05 |
Significant_Accounting_Policie3
Significant Accounting Policies (Narrative) (Details) (USD $) | 0 Months Ended | 1 Months Ended | 4 Months Ended | 12 Months Ended | ||||
Jun. 30, 2014 | Feb. 23, 2015 | Jun. 30, 2014 | Apr. 14, 2014 | Jun. 30, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Going Concern Assumption and Liquidity | ||||||||
Accumulated deficit | ($27,232,071) | ($23,881,370) | ||||||
Stockholders' deficit | -295,852 | -3,042,065 | 4,990 | |||||
Working capital | -322,420 | |||||||
2014 Financing Transactions | ||||||||
Issuance of equity units for cash, $1.00 per unit, containing one share of common stock and one warrant (in Shares) | 4,420,530 | |||||||
Proceeds received as consideration for equity units | 2,012,500 | |||||||
Debt conversion, original debt amount | 850,863 | 2,408,030 | 531,863 | |||||
Warrant exercise price (in Dollars per Share) | $1 | |||||||
Warrant term (in Duration) | 4 years | |||||||
Stock price floor for new share sales, below which additional shares of common stock must be issued to warrant investors | $1 | |||||||
Common stock issued (in Shares) | 854,363 | |||||||
Warrants issued (in Shares) | 1,277,363 | |||||||
Consideration received for issuance of common stock and warrants for the purchase of common stock | 3,500 | |||||||
Issuance of common stock on exercise of warrants | 327,455 | |||||||
Options exercised (in Shares) | 21,634 | 100,734 | ||||||
Proceeds from warrants and options exercised | 114,131 | |||||||
Revenue Recognition and Receivables | ||||||||
Period after which grants receivable are considered past due | 30 days | |||||||
Number of customers from which revenue was derived (in Integer) | $2 | |||||||
Provision for losses on accounts receivable | 0 | 0 | ||||||
Grant revenue invoiced under sub-award | 677,864 | |||||||
Grants receivable, sub-award | 4,136 | |||||||
Stock-Based Compensation | ||||||||
Stock-based compensation | 829,959 | 101,753 | ||||||
Research and Development Costs | ||||||||
Research and development | $1,960,815 | $1,827,533 | ||||||
Net Loss Per Common Share | ||||||||
Anitdilutive common share equivalents excluded from calculation of diluted earnings per share (in Shares) | 26,994,088 | 16,169,658 | ||||||
Minimum [Member] | ||||||||
Income Tax Contingency [Line Items] | ||||||||
Tax years subject to federal and state examinations (in Year) | 2011 | |||||||
Maximum [Member] | ||||||||
Income Tax Contingency [Line Items] | ||||||||
Tax years subject to federal and state examinations (in Year) | 2014 | |||||||
One Supplier [Member] | ||||||||
Concentration Risk [Line Items] | ||||||||
Percent of research and development purchases from one supplier (in Percent) | 61.40% |
Significant_Accounting_Policie4
Significant Accounting Policies (Useful Lives of Property and Equipment) (Details) | 12 Months Ended |
Dec. 31, 2014 | |
Lab equipment [Member] | |
Property Plant And Equipment [Line Items] | |
Useful lives, property and equipment (in Duration) | 5 years |
Computers and Software [Member] | |
Property Plant And Equipment [Line Items] | |
Useful lives, property and equipment (in Duration) | 3 years |
Leasehold Improvements [Member] | |
Property Plant And Equipment [Line Items] | |
Useful lives, property and equipment (in Duration) | 7 years |
Office Equipment and Furniture [Member] | |
Property Plant And Equipment [Line Items] | |
Useful lives, property and equipment (in Duration) | 3 years |
Property_and_Equipment_Narrati
Property and Equipment (Narrative) (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Property and Equipment [Abstract] | ||
Depreciation and amortization expense | $9,665 | $11,847 |
Property_and_Equipment_Compone
Property and Equipment (Components of Property and Equipment) (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | $439,726 | $431,492 |
Less accumulated depreciation and amortization | -413,158 | -403,493 |
Property and equipment, net | 26,568 | 27,999 |
Lab equipment [Member] | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | 329,406 | 321,172 |
Computers and Software [Member] | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | 67,739 | 67,739 |
Leasehold Improvements [Member] | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | 38,934 | 38,934 |
Office Equipment and Furniture [Member] | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | $3,647 | $3,647 |
Accounts_Payable_Narrative_Det
Accounts Payable (Narrative) (Details) (USD $) | 4 Months Ended | 12 Months Ended |
Jun. 30, 2014 | Dec. 31, 2014 | |
Accounts Payable [Abstract] | ||
Accounts payable settled through stock issuance | $2,727,030 | $2,727,030 |
Accrued_Compensation_Schedule_
Accrued Compensation (Schedule of Accrued Compensation) (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Accrued Compensation [Abstract] | ||
Accrued wages | $621,072 | $278,393 |
Accrued vacation | 84,681 | 75,557 |
Total accrued compensation | $705,753 | $353,950 |
Notes_Payable_Narrative_Detail
Notes Payable (Narrative) (Details) (USD $) | 2 Months Ended | 12 Months Ended | |
Sep. 30, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | |
Notes Payable [Abstract] | |||
Note payable, cash proceeds | $250,000 | $250,000 | |
Note payable, percentage of face value at issuance (in Percent) | 50.00% | ||
Note payable, annual interest rate (in Percent) | 8.00% | ||
Note payable, maturity date (in Date) | 5-Feb-14 | ||
Note payable, effective interest rate (in Percent) | 156.00% |
Derivative_Liabilities_Narrati
Derivative Liabilities (Narrative) (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Derivative Liabilities [Abstract] | ||
Stock price floor for new share sales, below which additional shares of common stock must be issued to warrant investors | $1 | |
Derivative liabilities | $32,175 | $0 |
Derivative_Liabilities_Schedul
Derivative Liabilities (Schedule of Assets and Liabilities Measured at Fair Value on a Recurring Basis) (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Derivative liabilities | $32,175 | $0 |
Recurring Measurement Basis [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Derivative liabilities | 32,175 | |
Recurring Measurement Basis [Member] | Fair Value Inputs Level 1 [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Derivative liabilities | ||
Recurring Measurement Basis [Member] | Fair Value Inputs Level 2 [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Derivative liabilities | ||
Recurring Measurement Basis [Member] | Fair Value Inputs Level 3 [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Derivative liabilities | $32,175 |
Derivative_Liabilities_Schedul1
Derivative Liabilities (Schedule of Level 3 Liabilities, Fair Value Reconciliation) (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ||
Derivative liabilities, beginning balance | $0 | |
Derivative liabilities related to down round provision of common stock units | 166,194 | |
Gain on derivative liabilities | -134,019 | |
Derivative liabilities, ending balance | $32,175 | $0 |
Derivative_Liabilities_Schedul2
Derivative Liabilities (Schedule of Valuation Assumptions Used In The Monte Carlo Simulation Model) (Details) (USD $) | 12 Months Ended |
Dec. 31, 2014 | |
Derivative Liability Fair Value Assumptions and Methodology Used in MonteCarlo Model | |
Threshold barrier | $1 |
Average down-round protection value per unit, minimum | $0.06 |
Average down-round protection value per unit, maximum | $0.17 |
Probability of down-round offer, minimum | 3.00% |
Probability of down-round offer, maximum | 10.00% |
Stockholders_Equity_Narrative_
Stockholders' Equity (Narrative) (Details) (USD $) | 12 Months Ended | 0 Months Ended | ||||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 18, 2014 | 6-May-13 | Dec. 18, 2012 | Dec. 31, 2012 | |
Common Stock | ||||||
Common stock, shares authorized (in Shares) | 100,000,000 | 100,000,000 | ||||
Common stock, shares outstanding (in Shares) | 30,477,460 | 24,936,833 | ||||
Oustanding options and warrants (in Shares) | 26,994,088 | 16,169,658 | ||||
Preferred Stock | ||||||
Preferred stock, shares authorized (in Shares) | 10,000,000 | |||||
Preferred stock, shares issued (in Shares) | 0 | |||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||||
Options outstanding (in Shares) | 8,952,927 | 3,865,440 | 3,865,440 | |||
Issuance of common stock upon exercise of stock options | $15,366 | |||||
Total fair value of equity awards vested during the period | 1,702,963 | |||||
Stock-based compensation | 829,959 | 101,753 | ||||
Aggregate intrinsic value of outstanding and exercisable stock options | 1,601,845 | |||||
Unrecognized stock-based compensation expense related to non-vested awards | 1,282,743 | |||||
Unrecognized stock-based compensation expense related to non-vested awards, period for recognition (in Duration) | 2 years 11 months 12 days | |||||
Warrants | ||||||
Warrants exercised (in Shares) | 327,455 | |||||
Proceeds from warrants exercised | 110,831 | |||||
Warrants expired (in Shares) | 820,931 | |||||
Stock Options [Member] | ||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||||
Additional shares authorized (in Shares) | 228,472 | |||||
2002 Stock Option Plan [Member] | ||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||||
Shares available and unissued (in Shares) | 228,472 | |||||
Options outstanding (in Shares) | 2,874,706 | |||||
2011 Equity Incentive Compensation Plan [Member] | ||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||||
Options outstanding (in Shares) | 1,728,472 | |||||
Shares reserved for issuance (in Shares) | 1,500,000 | |||||
Shares of 2002 Plan expired options added to new plan (in Shares) | 149,057 | |||||
Additional shares authorized (in Shares) | 228,472 | 6,250,000 | 3,000,000 | 3,000,000 | ||
Shares of common stock reserved for issuance, prior to additional share increase (in Shares) | 4,877,529 | 1,877,529 | ||||
Shares of common stock reserved for issuance, subsequent to additional share increase (in Shares) | 11,127,529 | 4,877,529 | ||||
Original exercise price (in Dollars per Share) | $1 | |||||
Modified exercise price (in Dollars per Share) | $0.70 | |||||
Number of options for which exercise price was modified (in Shares) | 890,000 | |||||
Incremental expense resulting from exercise price modification | $57,761 | |||||
Number of employees holding options for which exercise price was modified (in Integer) | $10 | |||||
2011 Equity Incentive Compensation Plan [Member] | Stock Options [Member] | ||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||||
Shares available and unissued (in Shares) | 5,049,308 | |||||
Options outstanding (in Shares) | 6,078,221 |
Stockholders_Equity_Summary_of
Stockholders' Equity (Summary of Stock Options Outstanding and Related Activity) (Details) (USD $) | 1 Months Ended | 12 Months Ended | ||
Feb. 23, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Number of Options Outstanding | ||||
Outstanding, beginning balance (in Shares) | 3,865,440 | 3,865,440 | ||
Granted (in Shares) | 5,188,221 | |||
Exercised (in Shares) | -21,634 | -100,734 | ||
Forfeited (in Shares) | ||||
Outstanding, ending balance (in Shares) | 8,952,927 | 3,865,440 | 3,865,440 | |
Exercisable options (in Shares) | 5,773,344 | |||
Weighted Average Exercise Price | ||||
Outstanding, beginning balance (in Dollars per Share) | $0.34 | $0.34 | ||
Granted (in Dollars per Share) | $0.70 | |||
Exercised (in Dollars per Share) | $0.15 | |||
Forfeited (in Dollars per Share) | ||||
Outstanding, ending balance (in Dollars per Share) | $0.55 | $0.34 | $0.34 | |
Exercisable options (in Dollars per Share) | $0.42 | |||
Weighted Average Remaining Contractual Life (Years) | ||||
Outstanding (in Duration) | 6 years 11 months 19 days | 6 years 22 days | 6 years 11 months 9 days | |
Exercisable options (in Duration) | 6 years 8 months 9 days | |||
Aggregate Intrinsic Value | ||||
Outstanding stock options, aggregate intrinsic value | $1,601,845 | $2,549,625 | $2,549,625 | |
Unvested option awards outstanding | ||||
Non-vested options outstanding, beginning balance (in Shares) | 424,167 | |||
Non-vested options granted (in Shares) | 5,188,221 | |||
Non-vested option vested during the year (in Shares) | -2,432,805 | |||
Non-vested options forfeited during the year (in Shares) | ||||
Non-vested options outstanding, ending balance (in Shares) | 3,179,583 | 424,167 | ||
Non-Vested Options Weighted Average Grant Date Fair Value | ||||
Non-vested options weighted average grant date fair value, beginning balance (In Dollars per Share) | $0.62 | |||
Non-vested options weighted average grant date fair value, options granted | $0.45 | |||
Non-vested options weighted average grant date fair value, options vested | $0.41 | |||
Non-vested options weighted average grant date fair value, options forfeited | ||||
Non-vested options weighted average grant date fair value, ending balance (In Dollars per Share) | $0.50 | $0.62 |
Stockholders_Equity_Summary_of1
Stockholders' Equity (Summary of Warrants Exercisable) (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Number of Warrants | |||
Outstanding, beginning balance (in Shares) | 12,304,518 | 11,979,518 | |
Granted (in Shares) | 5,749,143 | 325,000 | |
Exercised (in Shares) | |||
Forfeited (in Shares) | -62,500 | ||
Outstanding, ending balance (in Shares) | 17,991,161 | 12,304,518 | 11,979,518 |
Weighted Average Exercise Price Per Share | |||
Outstanding, beginning balance (in Dollars per Share) | $1.41 | $1.40 | |
Granted (in Dollars per Share) | $1 | $1.77 | |
Exercised (in Dollars per Share) | |||
Forfeited (in Dollars per Share) | $1.25 | ||
Outstanding, ending balance (in Dollars per Share) | $1.28 | $1.41 | $1.40 |
Weighted Average Remaining Life in Years | |||
Outstanding and Exercisable (in Duration) | 4 years 5 months 9 days | 5 years 6 months 7 days | 3 years 4 months 28 days |
Intrinsic Value | |||
Outstanding | $216,710 | $216,710 | $216,710 |
Warrants [Member] | |||
Number of Warrants | |||
Outstanding, ending balance (in Shares) | 17,991,691 | ||
Weighted Average Remaining Life in Years | |||
Outstanding and Exercisable (in Duration) | 9 months 18 days |
Stockholders_Equity_Summary_of2
Stockholders' Equity (Summary of Stock Warrants Outstanding) (Details) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Number of Warrants (in Shares) | 17,991,161 | 12,304,518 | 11,979,518 |
Weighted Average Remaining Life in Years (in Duration) | 4 years 5 months 9 days | 5 years 6 months 7 days | 3 years 4 months 28 days |
Warrants [Member] | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Number of Warrants (in Shares) | 17,991,691 | ||
Weighted Average Remaining Life in Years (in Duration) | 9 months 18 days | ||
Warrants [Member] | Exercise Price 0.05 [Member] | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Number of Warrants (in Shares) | 132,797 | ||
Weighted Average Remaining Life in Years (in Duration) | 1 month 6 days | ||
Warrants [Member] | Exercise Price 0.53 [Member] | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Number of Warrants (in Shares) | 192,242 | ||
Weighted Average Remaining Life in Years (in Duration) | 1 month 6 days | ||
Warrants [Member] | Exercise Price 1.00 [Member] | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Number of Warrants (in Shares) | 11,542,584 | ||
Weighted Average Remaining Life in Years (in Duration) | 3 years 7 months 6 days | ||
Warrants [Member] | Exercise Price 1.01 [Member] | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Number of Warrants (in Shares) | 125,000 | ||
Weighted Average Remaining Life in Years (in Duration) | 3 years 9 months 18 days | ||
Warrants [Member] | Exercise Price 1.04 [Member] | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Number of Warrants (in Shares) | 823,347 | ||
Weighted Average Remaining Life in Years (in Duration) | 1 month 6 days | ||
Warrants [Member] | Exercise Price 1.20 [Member] | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Number of Warrants (in Shares) | 43,000 | ||
Weighted Average Remaining Life in Years (in Duration) | 2 years | ||
Warrants [Member] | Exercise Price 1.75 [Member] | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Number of Warrants (in Shares) | 4,944,691 | ||
Weighted Average Remaining Life in Years (in Duration) | 3 months 18 days | ||
Warrants [Member] | Exercise Price 2.00 [Member] | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Number of Warrants (in Shares) | 62,500 | ||
Weighted Average Remaining Life in Years (in Duration) | 3 years 10 months 24 days | ||
Warrants [Member] | Exercise Price 2.25 [Member] | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Number of Warrants (in Shares) | 62,500 | ||
Weighted Average Remaining Life in Years (in Duration) | 6 months | ||
Warrants [Member] | Exercise Price 2.75 [Member] | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Number of Warrants (in Shares) | 62,500 | ||
Weighted Average Remaining Life in Years (in Duration) | 3 years 10 months 24 days |
Commitments_and_Contingencies_
Commitments and Contingencies (Narrative) (Details) (USD $) | 1 Months Ended | 12 Months Ended | 1 Months Ended | 0 Months Ended | 1 Months Ended | 9 Months Ended | 25 Months Ended | ||||
Apr. 14, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Sep. 30, 2013 | Mar. 07, 2014 | Jun. 30, 2014 | Jul. 31, 2013 | Oct. 01, 2013 | Oct. 31, 2014 | Oct. 01, 2014 | |
Supplier Agreements | |||||||||||
Warrant term (in Duration) | 4 years | ||||||||||
Advisory Agreements | |||||||||||
Warrant term (in Duration) | 4 years | ||||||||||
Operating Leases | |||||||||||
Lease expense | $160,001 | $152,098 | |||||||||
Operating leases future minimum payments due, 2015 | 123,891 | ||||||||||
Operating leases future minimum payments due, 2016 | 41,297 | ||||||||||
Royalty Agreements [Member] | |||||||||||
License and Royalty Agreements | |||||||||||
Royalty percentage due to be paid under license agreement for net sales on any services (in Percent) | 5.00% | ||||||||||
Royalty Agreements [Member] | Minimum [Member] | |||||||||||
License and Royalty Agreements | |||||||||||
Royalty percentage due to be paid under license agreement for net sales on any services (in Percent) | 2.00% | ||||||||||
Royalty Agreements [Member] | Maximum [Member] | |||||||||||
License and Royalty Agreements | |||||||||||
Royalty percentage due to be paid under license agreement for net sales on any services (in Percent) | 2.50% | ||||||||||
License Agreement One [Member] | |||||||||||
License and Royalty Agreements | |||||||||||
Percentage of all net licensing cash revenue company is required to pay university (in Percent) | 25.00% | ||||||||||
License Agreement Two [Member] | |||||||||||
License and Royalty Agreements | |||||||||||
Shares issuable for completion of certain license agreement milestones (in Shares) | 110,000 | ||||||||||
Licensor royalties payable (in Percent) | 5.00% | ||||||||||
Shares issued under license agreements (in Shares) | 65,000 | ||||||||||
Collaborative Arrangement [Member] | |||||||||||
Collaborative Arrangements | |||||||||||
Common stock issued for services (in Shares) | 100,000 | ||||||||||
Compensatory fee required to be paid to licensor if company sublicenses techology to third party (in Percent) | 10.00% | ||||||||||
Term of agreement (in Duration) | P10Y | ||||||||||
Supplier Agreements | |||||||||||
Common stock issued for services (in Shares) | 100,000 | ||||||||||
Supplier Agreements [Member] | |||||||||||
Collaborative Arrangements | |||||||||||
Common stock issued for services (in Shares) | 2,185,330 | ||||||||||
Supplier Agreements | |||||||||||
Common stock issued for services (in Shares) | 2,185,330 | ||||||||||
Warrants issued for services, shares of common stock purchasable (in Shares) | 2,185,330 | ||||||||||
Value of equity issuable under agreement | $500,000 | ||||||||||
Exercise price of warrants (in Dollars per Unit) | $1 | ||||||||||
Warrant term (in Duration) | 4 years | ||||||||||
Note payable interest rate applicable through July 31, 2015, for note payable created through conversion of any outstanding balance under purchase commitment upon conclusion of supplier's final project report (in Percent) | 8.00% | ||||||||||
Note payable interest rate applicable after July 31, 2015 through March 31, 2016, for note payable created through conversion of any outstanding balance under purchase commitment upon conclusion of supplier's final project report (in Percent) | 10.00% | ||||||||||
Advisory Agreements | |||||||||||
Exercise price of warrants (in Dollars per Unit) | $1 | ||||||||||
Warrant term (in Duration) | 4 years | ||||||||||
Advisory Agreements [Member] | |||||||||||
Supplier Agreements | |||||||||||
Warrant term (in Duration) | 5 years | ||||||||||
Advisory Agreements | |||||||||||
Restricted stock issued to investor relations firm for services rendered (in Shares) | 200,000 | ||||||||||
Warrants granted to investor relations firm for services rendered (in Shares) | 250,000 | ||||||||||
Number of warrants expired (in Shares) | 62,500 | ||||||||||
Number of warrants issued to purchase up to 175,000 shares of common stock (in Shares) | 3 | ||||||||||
Warrant strike price per share (in Dollars per Share) | $1.01 | ||||||||||
Warrant term (in Duration) | 5 years | ||||||||||
Advisory Agreements [Member] | Minimum [Member] | |||||||||||
Supplier Agreements | |||||||||||
Exercise price of warrants (in Dollars per Unit) | $1.25 | ||||||||||
Advisory Agreements | |||||||||||
Exercise price of warrants (in Dollars per Unit) | $1.25 | ||||||||||
Advisory Agreements [Member] | Maximum [Member] | |||||||||||
Supplier Agreements | |||||||||||
Exercise price of warrants (in Dollars per Unit) | $2.75 | ||||||||||
Advisory Agreements | |||||||||||
Exercise price of warrants (in Dollars per Unit) | $2.75 |
Income_Taxes_Narrative_Details
Income Taxes (Narrative) (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Income Taxes [Abstract] | ||
Net operating loss carryforwards | $23,608,000 | |
Operating loss carryforwards, expiration date (Date) | 31-Dec-22 | |
Research and development credits | 884,477 | 794,750 |
Tax credit carryforward, expiration date (Date) | 31-Dec-22 | |
Minimum percentage of stock ownership change over three year period resulting in corporation ownership change (in Percent) | 50.00% | |
Significant uncertain tax positions | $0 |
Income_Taxes_Schedule_of_Incom
Income Taxes (Schedule of Income Tax Benefit Reconciliation) (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Income Taxes [Abstract] | ||
Federal income tax at statutory rates | ($1,139,136) | ($1,152,292) |
State income tax at statutory rates | -99,401 | -108,575 |
Research and development credits | -89,692 | -161,935 |
Change in valuation allowance | 1,143,266 | 1,389,156 |
Other | 184,963 | 33,646 |
Benefit for income taxes |
Income_Taxes_Schedule_of_Defer
Income Taxes (Schedule of Deferred Tax Assets and Liabilities) (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Current: | ||
Accruals and reserves | $271,219 | $140,274 |
Non-qualified stock options and other | 24,351 | |
Change in valuation allowance | -295,570 | -140,274 |
Total, current | ||
Long-term: | ||
Net operating loss carryforwards | 8,805,743 | 8,064,635 |
Depreciation and amortization | 339 | 358 |
Non-qualified stock options and other | 227,944 | 70,605 |
Research and development credits | 884,477 | 794,750 |
Valuation allowance | -9,917,825 | -8,929,632 |
Total, long-term |
Benefit_Plans_Narrative_Detail
Benefit Plans (Narrative) (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Benefit Plans [Abstract] | ||
Minimum age of employee participants in company 401(k) retirement plan (in Duration) | 18 years | |
Percentage of annual compensation employees may contribute to 401(k) retirement plan, up to maximum amount allowed by Internal Revenue Service (in Percent) | 100.00% | |
Company elective contribution to 401(k) retirement plan | $20,549 | $15,144 |
RelatedParty_Transactions_Narr
Related-Party Transactions (Narrative) (Details) (USD $) | 0 Months Ended | 1 Months Ended | 4 Months Ended | 2 Months Ended | |
Jun. 30, 2014 | Apr. 14, 2014 | Jun. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2014 | |
Related Party Transaction [Line Items] | |||||
Note payable, percentage of face value at issuance (in Percent) | 50.00% | ||||
Debt conversion, original debt amount | $850,863 | $2,408,030 | $531,863 | ||
Officer and Affiliate [Member] | Bridge Financing [Member] | |||||
Related Party Transaction [Line Items] | |||||
Related party transaction, date (in Date) | 30-Sep-13 | ||||
Note payable, percentage of face value at issuance (in Percent) | 50.00% | ||||
Related party transaction, cash proceeds received | 200,000 | ||||
Related party notes payable, interest rate (in Percent) | 8.00% | ||||
Debt conversion, original debt amount | $427,863 |
Subsequent_Events_Narrative_De
Subsequent Events (Narrative) (Details) | 1 Months Ended | 12 Months Ended | |
Feb. 23, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Subsequent Event [Line Items] | |||
Options exercised (in Shares) | 21,634 | 100,734 | |
Subsequent Event [Member] | |||
Subsequent Event [Line Items] | |||
Subsequent event (Date) | 23-Feb-15 | ||
Warrants exercised (in Shares) | 327,455 | ||
Options exercised (in Shares) | 21,634 |