Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2017 | Nov. 03, 2017 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2017 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | ATHX | |
Entity Registrant Name | ATHERSYS, INC / NEW | |
Entity Central Index Key | 1,368,148 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 118,533,763 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 28,234 | $ 14,753 |
Accounts receivable | 707 | 598 |
Prepaid expenses and other | 1,031 | 929 |
Total current assets | 29,972 | 16,280 |
Equipment, net | 2,265 | 2,605 |
Deferred tax assets | 198 | 175 |
Total assets | 32,435 | 19,060 |
Current liabilities: | ||
Accounts payable | 4,285 | 4,761 |
Accrued compensation and related benefits | 1,017 | 1,190 |
Accrued clinical trial costs | 146 | 389 |
Accrued expenses | 412 | 535 |
Deferred revenue | 503 | |
Total current liabilities | 6,363 | 6,875 |
Warrant liabilities | 0 | 1,004 |
Stockholders' equity: | ||
Preferred stock, at stated value; 10,000,000 shares authorized, and no shares issued and outstanding at September 30, 2017 and December 31, 2016 | ||
Common stock, $0.001 par value; 300,000,000 and 150,000,000 shares authorized at September 30, 2017 and December 31, 2016, respectively, and 116,883,763 and 86,629,302 shares issued and outstanding at September 30, 2017 and December 31, 2016, respectively | 117 | 87 |
Additional paid-in capital | 363,485 | 329,373 |
Accumulated deficit | (337,530) | (318,279) |
Total stockholders' equity | 26,072 | 11,181 |
Total liabilities and stockholders' equity | $ 32,435 | $ 19,060 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2017 | Dec. 31, 2016 |
Statement of Financial Position [Abstract] | ||
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 300,000,000 | 150,000,000 |
Common stock, shares issued | 116,883,763 | 86,629,302 |
Common stock, shares outstanding | 116,883,763 | 86,629,302 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Loss - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Revenues | ||||
Contract revenue | $ 179 | $ 150 | $ 1,888 | $ 15,410 |
Grant revenue | 220 | 161 | 650 | 954 |
Total revenues | 399 | 311 | 2,538 | 16,364 |
Costs and expenses | ||||
Research and development | 5,441 | 5,263 | 15,707 | 17,750 |
General and administrative | 2,113 | 1,830 | 6,391 | 5,831 |
Depreciation | 177 | 114 | 508 | 248 |
Total costs and expenses | 7,731 | 7,207 | 22,606 | 23,829 |
Gain from insurance proceeds, net | 682 | 0 | 682 | |
Loss from operations | (7,332) | (6,214) | (20,068) | (6,783) |
Income (expense) from change in fair value of warrants, net | 191 | 728 | (1,689) | |
Other income, net | 71 | 7 | 155 | 228 |
Loss before income taxes | (7,261) | (6,016) | (19,185) | (8,244) |
Income tax benefit | 18 | 12 | 44 | 34 |
Net loss and comprehensive loss | $ (7,243) | $ (6,004) | $ (19,141) | $ (8,210) |
Net loss per share, basic | $ (0.06) | $ (0.07) | $ (0.17) | $ (0.10) |
Weighted average shares outstanding, basic | 114,515,405 | 84,928,198 | 109,506,379 | 84,352,347 |
Net loss per share, diluted | $ (0.06) | $ (0.07) | $ (0.17) | $ (0.10) |
Weighted average shares outstanding, diluted | 114,515,405 | 85,896,993 | 109,506,379 | 84,352,347 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Operating activities | ||
Net loss | $ (19,141) | $ (8,210) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation | 508 | 248 |
Gain from forgiveness of note payable | (190) | |
Stock-based compensation | 2,232 | 2,177 |
Gain from insurance proceeds, net | 0 | (682) |
Change in fair value of warrant liabilities | (728) | 1,689 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (109) | 63 |
Prepaid expenses and other | (125) | (262) |
Accounts payable and accrued expenses | (1,015) | 765 |
Deferred revenue | 503 | (245) |
Net cash used in operating activities | (17,875) | (4,647) |
Investing activities | ||
Purchase of available-for-sale-securities | (15,903) | |
Sales of available-for-sale-securities | 4,830 | |
Purchases of equipment | (168) | (1,635) |
Proceeds from insurance | 507 | |
Net cash used in investing activities | (168) | (12,201) |
Financing activities | ||
Proceeds from issuance of common stock, net | 29,863 | 2,386 |
Shares retained for withholding tax payments on stock-based awards | (200) | (418) |
Proceeds from exercise of warrants | 1,861 | 162 |
Net cash provided by financing activities | 31,524 | 2,130 |
Increase (decrease) in cash and cash equivalents | 13,481 | (14,718) |
Cash and cash equivalents at beginning of the period | 14,753 | 23,027 |
Cash and cash equivalents at end of the period | $ 28,234 | $ 8,309 |
Background and Basis of Present
Background and Basis of Presentation | 9 Months Ended |
Sep. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Background and Basis of Presentation | 1. Background and Basis of Presentation We are an international biotechnology company that is focused primarily in the field of regenerative medicine and operate in one business segment. Our operations consist primarily of research and product development activities. We incurred losses since our inception in 1995 and had an accumulated deficit of $338 million at September 30, 2017. We will require substantial additional capital to continue our research and development programs, including progressing our clinical product candidates to commercialization and preparing for commercial-scale manufacturing. At September 30, 2017, we had available cash and cash equivalents of $28.2 million, and we believe that these funds, used to execute our existing operating plans, are sufficient to meet our obligations as they come due for a period of at least twelve months from the date of the issuance of these unaudited condensed consolidated financial statements. In the longer term, we will make use of available cash, but will have to continue to generate additional capital to meet our needs through new and existing collaborations and related license fees and milestones, the sale of equity securities from time to time, including through our equity purchase agreement, grant-funding opportunities, deferring certain discretionary costs and staging certain development costs, as needed. The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the audited financial statements and notes thereto included in our Annual Report on Form 10-K S-X. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Our critical accounting policies, estimates and assumptions are described in “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” which is included below in this Quarterly Report on Form 10-Q. |
Recently Issued Accounting Stan
Recently Issued Accounting Standards | 9 Months Ended |
Sep. 30, 2017 | |
Accounting Changes and Error Corrections [Abstract] | |
Recently Issued Accounting Standards | 2. Recently Issued Accounting Standards In March 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-09, Compensation - Stock Compensation - Improvements to Employee Share-Based Payment Accounting An entity should also recognize excess tax benefits regardless of whether the benefit reduces taxes payable in the current period. Excess tax benefits should be classified along with other income tax cash flows as an operating activity. In regard to forfeitures, the entity may make an entity-wide accounting policy election to either estimate the number of awards that are expected to vest or account for forfeitures when they occur. We have adopted ASU 2016-09, In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) 2016-02”), right-of-use 2016-02 2016-02. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) 2014-09”). 2014-09 2015-14, 2014-09 2014-09 one-for-one 2014-09 |
Net Loss per Share
Net Loss per Share | 9 Months Ended |
Sep. 30, 2017 | |
Earnings Per Share [Abstract] | |
Net Loss per Share | 3. Net Loss per Share Basic and diluted net loss per share have been computed using the weighted-average number of shares of common stock outstanding during the period. The table below reconciles the net loss and the number of shares used to calculate basic and diluted net loss per share for the three- and nine-month periods ended September 30, 2017 and 2016, in thousands, except per share data. Three months ended Nine months ended September 30, 2017 2016 2017 2016 Numerator: Net loss attributable to common stockholders - Basic $ (7,243 ) $ (6,004 ) $ (19,141 ) $ (8,210 ) Less: income from change in fair value of warrants — (191 ) — — Net loss attributable to common stockholders used to calculate diluted net loss per share $ (7,243 ) $ (6,195 ) $ (19,141 ) $ (8,210 ) Denominator: Weighted-average shares outstanding - Basic 114,515 84,928 109,506 84,352 Potentially dilutive common shares outstanding: Warrants — 969 — — Weighted-average shares used to calculate diluted net loss per share 114,515 85,897 109,506 84,352 Basic earnings per share $ (0.06 ) $ (0.07 ) $ (0.17 ) $ (0.10 ) Dilutive earnings per share $ (0.06 ) $ (0.07 ) $ (0.17 ) $ (0.10 ) We have outstanding stock-based awards and warrants that are not used in the calculation of diluted net loss per share because to do so would be antidilutive. The following instruments were excluded from the calculation of diluted net loss per share because their effects would be antidilutive: Three months ended September 30, Nine months ended September 30, 2017 2016 2017 2016 Stock-based awards 10,880,000 10,840,306 10,880,000 10,840,306 Warrants — — — 1,893,527 Total 10,880,000 10,840,306 10,880,000 12,733,833 |
Financial Instruments
Financial Instruments | 9 Months Ended |
Sep. 30, 2017 | |
Investments, All Other Investments [Abstract] | |
Financial Instruments | 4. Financial Instruments Fair Value Measurements We classify the inputs used to measure fair value into the following hierarchy: Level 1 Unadjusted quoted prices in active markets for identical assets or liabilities. Level 2 Unadjusted quoted prices in active markets for similar assets or liabilities, or unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs other than quoted prices that are observable for the asset or liability. Level 3 Unobservable inputs for the asset or liability. At September 30, 2017, we had no financial assets or liabilities measured at fair value on a recurring basis. At December 31, 2016, we had warrant liabilities of $1,004,000 that represented Level 3 liabilities under the hierarchy. In March 2017, these warrants were either exercised or expired, and we no longer have any outstanding warrants. We review and reassess the fair value hierarchy classifications on a quarterly basis. Changes from one quarter to the next related to the observability of inputs in a fair value measurement may result in a reclassification between fair value hierarchy levels. There were no reclassifications for all periods presented. The estimated fair value of warrants accounted for as liabilities, representing a Level 3 fair value measure, was determined on the issuance date and subsequently marked to market at each financial reporting date. We use the Black-Scholes valuation model to value the warrant liabilities at fair value. The fair value was estimated using the expected volatility based on our historical volatility and is determined using probability weighted-average assumptions, when appropriate. A roll-forward of fair value measurements using significant unobservable inputs (Level 3) for the warrant liabilities is as follows (in thousands): Nine months ended September 30, 2017 Balance January 1, 2017 $ 1,004 Settlements from exercises (276 ) Gain included in income from change in fair value of warrants (728 ) Balance September 30, 2017 $ — |
Insurance Recovery
Insurance Recovery | 9 Months Ended |
Sep. 30, 2017 | |
Unusual or Infrequent Items, or Both [Abstract] | |
Insurance Recovery | 5. Insurance Recovery In May 2016, a flood caused damage to our primary facilities that required the reconstruction of certain laboratory space over several months. The damaged items included fully-depreciated leasehold improvements under an operating lease and laboratory supplies, all of which were covered by insurance and were replaced at replacement cost. Net insurance recovery proceeds resulted in the recognition of a net insurance recovery gain amounting to $682,000 as of September 30, 2016. Since the majority of the damage from the flood was to fully-depreciated leasehold improvements, the amount of losses were less than the amount of the insurance proceeds received. No insurance recoveries were recognized in the nine-month period ended September 30, 2017. |
Collaborative Arrangements and
Collaborative Arrangements and Revenue Recognition | 9 Months Ended |
Sep. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Collaborative Arrangements and Revenue Recognition | 6. Collaborative Arrangements and Revenue Recognition Healios In January 2016, we entered into a license agreement (“Healios Agreement”) with HEALIOS K.K. (“Healios”) to develop and commercialize MultiStem cell therapy for ischemic stroke in Japan, and to provide Healios with access to Athersys’ proprietary stem cell technology for use in Healios’ “organ bud” program, initially for transplantation to treat liver disease or dysfunction. Under the Healios Agreement, Healios also obtained a right, at their option, to expand the scope of the collaboration to include the exclusive rights to develop and commercialize MultiStem for the treatment of two additional indications in Japan, which include acute respiratory distress syndrome (“ARDS”) and another indication in the orthopedic area, and to include all indications for the “organ bud” program. Healios may exercise its option to expand the collaboration prior to certain milestone dates that are expected to occur within the next several years. Under the terms of the Healios Agreement, we received a nonrefundable, up-front For the ischemic stroke indication, we may also receive additional success-based development, regulatory approval and sales milestones, which are non-refundable non-creditable If Healios exercises the option to expand the collaboration to include ARDS and another indication in the orthopedic area, we would be entitled to receive a cash payment of $10 million at the time of exercise and receive royalties from product sales and success-based development, regulatory approval and sales milestones, as well as payments for product supply related to the additional indications covered by the option. For the “organ bud” product, we are entitled to receive a fractional royalty percentage on net sales of the “organ bud” products and will receive payments for manufactured product supplied to Healios under a manufacturing supply agreement. Additionally, we have a right of first negotiation for commercialization of an “organ bud” product in North America, with such right expiring on certain dates in the future. To determine the appropriate accounting for the license agreement, we evaluated the Healios Agreement and related facts and circumstances, focusing in particular on the rights and obligations of the arrangement. We determined that our obligations under the Healios Agreement represent multiple deliverables, and for deliverables with standalone value, our policy is to account for these as separate units of accounting. We allocate the overall consideration of the arrangement that is fixed and determinable, excluding consideration that is contingent upon future deliverables, to the separate units of accounting based on estimated selling prices (as defined in ASC 605-25) Given Healios’ ability to sublicense under the Healios Agreement and its ability to conduct the ongoing development efforts at the inception of the arrangement, we concluded that the license had stand-alone value and would be treated as a separate unit of accounting, noting also that there was no general right of return associated with the license. Furthermore, the preclinical and clinical manufacturing services and certain near-term regulatory advisory services to be provided to Healios under the Healios Agreement were also determined to have stand-alone value and considered separate units of accounting at the inception of the arrangement. We were unable to establish vendor-specific objective evidence of selling price or third-party evidence for either the license or the services, and thus, instead, allocated the arrangement consideration between the license and the services based on their relative selling prices using a best estimate of selling price (“BESP”). We developed the BESP of the license using a probability-weighted, discounted cash flow analysis using the income approach, taking into consideration market assumptions, including the estimated development and commercialization timeline, data regarding patient population, discount rate related to our industry, and probability of success using market data for both our industry and the therapeutic field. We estimated the BESP of the manufacturing services and certain near-term regulatory advisory services using actual historical experience and best estimates of the cost of obtaining these services at arm’s length from a third-party provider, including an estimated mark-up. Other contingent deliverables that were not accounted for at the inception of the arrangement, and will not be accounted for until the contingency is resolved, included the potential expansion of the collaboration to include additional indications, and the milestones that are not substantive since they are dependent on the activities of Healios. Further, the Healios arrangement contemplates our providing manufacturing services for commercial product supply, the terms of which are not defined and are to be agreed upon in the future under a separate commercial supply agreement. Upon the removal of these contingencies or modifications to the deliverables under the arrangement, we will reevaluate the allocation of revenue to the remaining undelivered items, including the estimated selling prices and the overall consideration of the arrangement, with any changes in estimates accounted for on a prospective basis. In January 2017, we signed a clinical trial supply agreement for the manufacturing of investigational product for Healios for its Japan clinical study, the terms of which were consistent with the license agreement. The clinical trial supply agreement was amended in July 2017 and clarifies the operational elements, terms and cost-sharing arrangement associated with our supply of clinical material. The manufacturing proceeds from Healios that relate specifically to the cost-sharing arrangement may result in a reduction in the proceeds we receive from Healios upon the achievement of two future milestones, and an increase to a late-stage commercial milestone. Of the aggregate $225 million of potential proceeds from success-based development, regulatory approval and sales milestones, the maximum decrease related to current cost-sharing proceeds amounts to less than 6% of the aggregate milestones, and the maximum increase amounts to less than 3%. The cost-sharing proceeds received are not recognized as revenue until the related milestone is achieved, at which time, the culmination of the earnings process will be complete. Until that time, the cost-sharing proceeds, upon receipt, will be reflected on the balance sheet. We expect to receive the first cost-sharing proceeds from Healios in the fourth quarter of 2017. In September 2017, we entered into a services agreement with Healios, in which Healios provides financial support to establish a contract manufacturer in Japan to produce product for Healios. The arrangement includes a potential decrease to the amount we may receive from a future milestone if Healios is unable to obtain product from the contract manufacturer within a specified period of time. We expect the services under this arrangement to commence in the fourth quarter of 2017. Furthermore, in September 2017, we amended the Healios Agreement to confer to Healios a limited license to manufacture MultiStem in the event that we are acquired by a third-party. Other In January 2017, we received an option fee related to an agreement that was entered into in December 2016 with a global leader in the animal health business segment to evaluate our cell therapy technology for application in an animal health area. Under the terms of the agreement, we received the payment in exchange for an exclusive period to evaluate our cell therapy technology with an option to negotiate for a license for the development and commercialization of the technology for the animal health area. The option fee is recorded as deferred revenue at September 30, 2017 since the performance obligation of granting a license has not occurred. If the option is exercised, we will include the option fee in the overall consideration for the license arrangement, to be evaluated at that time. If the option is not exercised, the option fee will be recognized as revenue at that time since there will be no more performance obligations. The evaluation of our technology for this application is currently ongoing. Under our agreement with RTI Surgical, Inc. to develop and commercialize biologic implants using our technology for certain orthopedic applications in the bone graft substitutes market, we are eligible to receive cash payments upon the successful achievement of certain commercial milestones. The first commercial milestone was achieved in the first quarter of 2017, with a payment in the amount of $1.0 million, which we received in April 2017. In addition, we continue to receive tiered royalties on worldwide commercial sales of implants using our technologies based on a royalty rate starting in the mid-single mid-teens. |
Stock-based Compensation
Stock-based Compensation | 9 Months Ended |
Sep. 30, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-based Compensation | 7. Stock-based Compensation We have an incentive plan that authorizes 20,035,000 shares of common stock for awards to employees, directors and consultants. The incentive plan authorizes the issuance of equity-based compensation in the form of stock options, stock appreciation rights, restricted stock, restricted stock units, performance shares and units, and other stock-based awards. In June 2017, a separate incentive plan with 1,465,000 authorized shares expired according to its terms, and 1,074,391 stock options remain outstanding under the plan that survive the plan’s expiration. As of September 30, 2017, a total of 3,979,429 shares of common stock have been issued under our equity incentive plans. As of September 30, 2017, a total of 6,362,584 shares of common stock were available for issuance under our equity incentive plans, and stock-based awards to purchase 10,880,000 shares of common stock were outstanding. For the three-month periods ended September 30, 2017 and 2016, stock-based compensation expense was approximately $814,000 and $748,000, respectively. At September 30, 2017, total unrecognized estimated compensation cost related to unvested stock-based awards was approximately $8.0 million, which is expected to be recognized by the end of 2021 using the straight-line method |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2017 | |
Equity [Abstract] | |
Stockholders' Equity | 8. Stockholders’ Equity Charter Amendment In June 2017, our stockholders approved an amendment to our certificate of incorporation to increase the number of authorized shares of common stock to 300,000,000. Other than the change to the number of authorized shares of common stock, there were no changes to the terms of our common stock. Equity Offering In February 2017, we completed a public offering generating net proceeds of approximately $20.9 million through the issuance of 22,772,300 shares of common stock at an offering price of $1.01 per share. Equity Purchase Agreement We currently have in place an equity purchase agreement with Aspire Capital Fund LLC (“Aspire Capital”) that was entered into in December 2015 and provides that Aspire Capital is committed to purchase shares of our common stock up to an aggregate amount of $30.0 million over a three-year term, subject to our election to sell any such shares. We filed a registration statement for the resale of 16,600,000 shares of common stock in connection with the equity facility. During the three-month period ended September 30, 2017, we sold 3,700,000 shares to Aspire Capital under the equity purchase agreement, generating aggregate proceeds of $6.6 million. During the nine-month period ended September 30, 2017, we sold 5,350,000 shares to Aspire Capital under the equity purchase agreement, generating aggregate proceeds of $9.0 million. |
Warrant Liabilities
Warrant Liabilities | 9 Months Ended |
Sep. 30, 2017 | |
Text Block [Abstract] | |
Warrant Liabilities | 9. Warrant Liabilities As of September 30, 2017, we had no warrants outstanding. All of our previously outstanding warrants were either exercised prior to expiration or expired in March 2017. We received proceeds of $1.9 million in the first quarter of 2017 from warrant exercises. Prior to their expiration, we accounted for common stock warrants as either liabilities or as equity instruments depending on the specific terms of the warrant agreement. Registered common stock warrants that could require cash settlement were accounted for as liabilities and classified on the consolidated balance sheet as a non-current |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 10. Income Taxes We have U.S. federal net operating loss and research and development tax credit carryforwards, as well as state and city net operating loss carryforwards, which may be used to reduce future taxable income and tax liabilities. We also have foreign net operating loss and tax credit carryforwards, and the foreign net operating losses do not expire. Substantially all of our deferred tax assets have been fully offset by a valuation allowance due to our cumulative losses. We recognize refundable tax benefits related to research and development credits associated with one of our foreign subsidiary. The utilization of net operating loss and tax credit carryforwards generated prior to October 2012 is substantially limited under Section 382 of the Internal Revenue Code of 1986, as amended, as a result of our October 2012 equity offering. We generated U.S. federal net operating loss carryforwards, research and development tax credits, and state and local net operating loss carryforwards since 2012. We will update our analysis under Section 382 prior to using these attributes. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events | 11. Subsequent Events License Agreement and Settlement In October 2017, we entered into an agreement with Garnet BioTherapeutics, Inc. (“Garnet”) to settle longstanding intellectual property disagreements between the parties. As a routine matter, we actively develop, improve, protect and defend our intellectual property portfolio through prosecution efforts and contractual arrangements. Over the past several years, we have been involved in several proceedings in the United States and Europe involving Garnet, focused on stem cell technologies. As part of the agreement, we have been granted a license to Garnet patents and applications that have been at the core of the intellectual property dispute, for use related to the treatment or prevention of disease or conditions using cells. In return, we have agreed not to enforce our intellectual property rights against Garnet with respect to therapeutic agents derived from cells (but we fully retain our ability to enforce our rights with respect to cells used as therapy). We also agreed not to further challenge the patentability or validity of certain Garnet applications or patents (noting that we have been granted a license, as described above). We initially paid Garnet $500,000 and issued 1,000,000 shares of our common stock in connection with the execution of the agreement, and we will pay an additional $250,000 over each of the next four quarters. Additionally, we will issue 500,000 shares of common stock upon issuance of a patent from the Garnet patent applications at the core of the dispute. There will be no royalty payments or milestone payments to Garnet associated with the development and commercialization of our cell therapy products or other payments to Garnet related to the settlement agreement. |
Recently Issued Accounting St17
Recently Issued Accounting Standards (Policies) | 9 Months Ended |
Sep. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Recently Issued Accounting Standards | Recently Issued Accounting Standards In March 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-09, Compensation - Stock Compensation - Improvements to Employee Share-Based Payment Accounting An entity should also recognize excess tax benefits regardless of whether the benefit reduces taxes payable in the current period. Excess tax benefits should be classified along with other income tax cash flows as an operating activity. In regard to forfeitures, the entity may make an entity-wide accounting policy election to either estimate the number of awards that are expected to vest or account for forfeitures when they occur. We have adopted ASU 2016-09, In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) 2016-02”), right-of-use 2016-02 2016-02. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) 2014-09”). 2014-09 2015-14, 2014-09 2014-09 one-for-one 2014-09 |
Fair Value Measurements | Fair Value Measurements We classify the inputs used to measure fair value into the following hierarchy: Level 1 Unadjusted quoted prices in active markets for identical assets or liabilities. Level 2 Unadjusted quoted prices in active markets for similar assets or liabilities, or unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs other than quoted prices that are observable for the asset or liability. Level 3 Unobservable inputs for the asset or liability. At September 30, 2017, we had no financial assets or liabilities measured at fair value on a recurring basis. At December 31, 2016, we had warrant liabilities of $1,004,000 that represented Level 3 liabilities under the hierarchy. In March 2017, these warrants were either exercised or expired, and we no longer have any outstanding warrants. We review and reassess the fair value hierarchy classifications on a quarterly basis. Changes from one quarter to the next related to the observability of inputs in a fair value measurement may result in a reclassification between fair value hierarchy levels. There were no reclassifications for all periods presented. The estimated fair value of warrants accounted for as liabilities, representing a Level 3 fair value measure, was determined on the issuance date and subsequently marked to market at each financial reporting date. We use the Black-Scholes valuation model to value the warrant liabilities at fair value. The fair value was estimated using the expected volatility based on our historical volatility and is determined using probability weighted-average assumptions, when appropriate. |
Collaborative Arrangements | Healios In January 2016, we entered into a license agreement (“Healios Agreement”) with HEALIOS K.K. (“Healios”) to develop and commercialize MultiStem cell therapy for ischemic stroke in Japan, and to provide Healios with access to Athersys’ proprietary stem cell technology for use in Healios’ “organ bud” program, initially for transplantation to treat liver disease or dysfunction. Under the Healios Agreement, Healios also obtained a right, at their option, to expand the scope of the collaboration to include the exclusive rights to develop and commercialize MultiStem for the treatment of two additional indications in Japan, which include acute respiratory distress syndrome (“ARDS”) and another indication in the orthopedic area, and to include all indications for the “organ bud” program. Healios may exercise its option to expand the collaboration prior to certain milestone dates that are expected to occur within the next several years. |
Royalties | We will also receive tiered royalties on net product sales, starting in the low double-digits and increasing incrementally into the high teens, depending on net sales levels. If Healios exercises the option to expand the collaboration to include ARDS and another indication in the orthopedic area, we would be entitled to receive a cash payment of $10 million at the time of exercise and receive royalties from product sales and success-based development, regulatory approval and sales milestones, as well as payments for product supply related to the additional indications covered by the option. For the “organ bud” product, we are entitled to receive a fractional royalty percentage on net sales of the “organ bud” products and will receive payments for manufactured product supplied to Healios under a manufacturing supply agreement. Additionally, we have a right of first negotiation for commercialization of an “organ bud” product in North America, with such right expiring on certain dates in the future. |
Revenue Recognition | To determine the appropriate accounting for the license agreement, we evaluated the Healios Agreement and related facts and circumstances, focusing in particular on the rights and obligations of the arrangement. We determined that our obligations under the Healios Agreement represent multiple deliverables, and for deliverables with standalone value, our policy is to account for these as separate units of accounting. We allocate the overall consideration of the arrangement that is fixed and determinable, excluding consideration that is contingent upon future deliverables, to the separate units of accounting based on estimated selling prices (as defined in ASC 605-25) |
Warrant Liabilities | we accounted for common stock warrants as either liabilities or as equity instruments depending on the specific terms of the warrant agreement. Registered common stock warrants that could require cash settlement were accounted for as liabilities and classified on the consolidated balance sheet as a non-current |
Net Loss per Share (Tables)
Net Loss per Share (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Earnings Per Share [Abstract] | |
Net Loss and Number of Shares Used to Calculate Basic and Diluted Net Loss Per Share | The table below reconciles the net loss and the number of shares used to calculate basic and diluted net loss per share for the three- and nine-month periods ended September 30, 2017 and 2016, in thousands, except per share data. Three months ended Nine months ended September 30, 2017 2016 2017 2016 Numerator: Net loss attributable to common stockholders - Basic $ (7,243 ) $ (6,004 ) $ (19,141 ) $ (8,210 ) Less: income from change in fair value of warrants — (191 ) — — Net loss attributable to common stockholders used to calculate diluted net loss per share $ (7,243 ) $ (6,195 ) $ (19,141 ) $ (8,210 ) Denominator: Weighted-average shares outstanding - Basic 114,515 84,928 109,506 84,352 Potentially dilutive common shares outstanding: Warrants — 969 — — Weighted-average shares used to calculate diluted net loss per share 114,515 85,897 109,506 84,352 Basic earnings per share $ (0.06 ) $ (0.07 ) $ (0.17 ) $ (0.10 ) Dilutive earnings per share $ (0.06 ) $ (0.07 ) $ (0.17 ) $ (0.10 ) |
Instruments Excluded from Calculation of Diluted Net Loss Per Share | The following instruments were excluded from the calculation of diluted net loss per share because their effects would be antidilutive: Three months ended September 30, Nine months ended September 30, 2017 2016 2017 2016 Stock-based awards 10,880,000 10,840,306 10,880,000 10,840,306 Warrants — — — 1,893,527 Total 10,880,000 10,840,306 10,880,000 12,733,833 |
Financial Instruments (Tables)
Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Investments, All Other Investments [Abstract] | |
Roll-Forward of Fair Value Measurements Using Significant Unobservable Inputs (Level 3) for Warrant Liabilities | A roll-forward of fair value measurements using significant unobservable inputs (Level 3) for the warrant liabilities is as follows (in thousands): Nine months ended September 30, 2017 Balance January 1, 2017 $ 1,004 Settlements from exercises (276 ) Gain included in income from change in fair value of warrants (728 ) Balance September 30, 2017 $ — |
Background and Basis of Prese20
Background and Basis of Presentation - Additional Information (Detail) $ in Thousands | 9 Months Ended | |||
Sep. 30, 2017USD ($)Segment | Dec. 31, 2016USD ($) | Sep. 30, 2016USD ($) | Dec. 31, 2015USD ($) | |
Accounting Policies [Abstract] | ||||
Number of business segments | Segment | 1 | |||
Accumulated deficit | $ (337,530) | $ (318,279) | ||
Cash and cash equivalents | $ 28,234 | $ 14,753 | $ 8,309 | $ 23,027 |
Recently Issued Accounting St21
Recently Issued Accounting Standards - Additional Information (Detail) $ in Millions | Jan. 01, 2017USD ($) | Sep. 30, 2017Facility |
Accounting Policies [Abstract] | ||
Accumulated deficit recognized due to adoption of new accounting policy | $ | $ 0.1 | |
Number of operating leases facilities that need to be evaluated under the ASU 2016-02 | Facility | 2 |
Net Loss per Share - Net Loss a
Net Loss per Share - Net Loss and Number of Shares Used to Calculate Basic and Diluted Net Loss Per Share (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Numerator: | ||||
Net loss attributable to common stockholders - Basic | $ (7,243) | $ (6,004) | $ (19,141) | $ (8,210) |
Less: income from change in fair value of warrants | (191) | |||
Net loss attributable to common stockholders used to calculate diluted net loss per share | $ (7,243) | $ (6,195) | $ (19,141) | $ (8,210) |
Denominator: | ||||
Weighted-average shares outstanding - Basic | 114,515,405 | 84,928,198 | 109,506,379 | 84,352,347 |
Potentially dilutive common shares outstanding: | ||||
Warrants | 969,000 | |||
Weighted-average shares used to calculate diluted net loss per share | 114,515,405 | 85,896,993 | 109,506,379 | 84,352,347 |
Basic earnings per share | $ (0.06) | $ (0.07) | $ (0.17) | $ (0.10) |
Dilutive earnings per share | $ (0.06) | $ (0.07) | $ (0.17) | $ (0.10) |
Net Loss per Share - Instrument
Net Loss per Share - Instruments Excluded from Calculation of Diluted Net Loss Per Share (Detail) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total | 10,880,000 | 10,840,306 | 10,880,000 | 12,733,833 |
Stock - Based Awards [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total | 10,880,000 | 10,840,306 | 10,880,000 | 10,840,306 |
Warrants [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total | 1,893,527 |
Financial Instruments - Additio
Financial Instruments - Additional Information (Detail) - USD ($) | Sep. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 |
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | |||
Financial assets measured at fair value on recurring basis | $ 0 | ||
Financial liabilities measured at fair value on recurring basis | 0 | ||
Warrant liabilities | $ 0 | $ 1,004,000 | |
Fair Value Measurements, Recurring Basis [Member] | Significant Unobservable Inputs (Level 3) [Member] | |||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | |||
Warrant liabilities | $ 0 | $ 1,004,000 |
Financial Instruments - Roll-Fo
Financial Instruments - Roll-Forward of Fair Value Measurements Using Significant Unobservable Inputs (Level 3) for Warrant Liabilities (Detail) - Outstanding Warrants [Member] $ in Thousands | 9 Months Ended |
Sep. 30, 2017USD ($) | |
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | |
Beginning Balance | $ 1,004 |
Settlements from exercises | (276) |
Gain included in income from change in fair value of warrants | $ (728) |
Insurance Recovery - Additional
Insurance Recovery - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Insurance [Abstract] | |||
Gain from insurance proceeds, net | $ 682 | $ 0 | $ 682 |
Collaborative Arrangement and R
Collaborative Arrangement and Revenue Recognition - Additional Information (Detail) $ in Millions | 9 Months Ended |
Sep. 30, 2017USD ($)Milestone | |
Healios License Agreement [Member] | |
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |
Up-front cash payment received | $ 15 |
Potential near-term payment received | 10 |
License revenue | 15 |
Healios License Agreement [Member] | Regulatory and Sales Milestones [Member] | |
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |
Commercial milestone revenue | $ 225 |
Number of future milestones achieved | Milestone | 2 |
Healios License Agreement [Member] | Maximum [Member] | Regulatory and Sales Milestones [Member] | |
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |
Maximum increase of current cost-sharing proceeds | 3.00% |
Maximum decrease of current cost-sharing proceeds | 6.00% |
RTI Surgical Inc [Member] | |
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |
Commercial milestone revenue | $ 1 |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Detail) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2017 | Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||
Common stock authorized for equity incentive plans | 20,035,000 | 20,035,000 | |||
Stock option expired | 1,465,000 | ||||
Stock option outstanding | 1,074,391 | ||||
Common stock shares issued | 3,979,429 | ||||
Shares available for issuance | 6,362,584 | 6,362,584 | |||
Shares of common stock outstanding | 10,880,000 | 10,880,000 | |||
Stock-based compensation expense | $ 814 | $ 748 | $ 2,232 | $ 2,177 | |
Total unrecognized estimated compensation cost | $ 8,000 | $ 8,000 |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||
Feb. 28, 2017 | Sep. 30, 2017 | Sep. 30, 2017 | Sep. 30, 2016 | Jun. 30, 2017 | Dec. 31, 2016 | |
Class of Stock [Line Items] | ||||||
Common stock, shares authorized | 300,000,000 | 300,000,000 | 300,000,000 | 150,000,000 | ||
Proceeds from common stock issued in public offerings | $ 20,900 | $ 29,863 | $ 2,386 | |||
Common stock share issued in public offering | 22,772,300 | |||||
Common stock offering price | $ 1.01 | |||||
Common stock registered for resale | 16,600,000 | 16,600,000 | ||||
Aspire Capital [Member] | ||||||
Class of Stock [Line Items] | ||||||
Proceeds from common stock issued in public offerings | $ 6,600 | $ 9,000 | ||||
Equity purchase agreement, value | $ 30,000 | |||||
Equity purchase agreement, term | 3 years | |||||
Aspire Capital [Member] | Common Stock [Member] | ||||||
Class of Stock [Line Items] | ||||||
Common stock share issued in public offering | 3,700,000 | 5,350,000 |
Warrant Liabilities - Additiona
Warrant Liabilities - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2017 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | |
Equity [Abstract] | ||||
Warrants outstanding | $ 0 | $ 1,004 | ||
Proceeds from warrant exercises | $ 1,900 | $ 1,861 | $ 162 |
Subsequent Events - Additional
Subsequent Events - Additional Information (Detail) - Subsequent Event [Member] - Garnet Bio Therapeutics Inc [Member] $ in Thousands | 1 Months Ended |
Oct. 31, 2017USD ($)shares | |
Subsequent Event [Line Items] | |
Payment to acquire intellectual property rights | $ | $ 500 |
Additional shares issuable upon issuance of intellectual property rights | shares | 500,000 |
Future additional payments to acquire intellectual property rights, each quarter | $ | $ 250 |
Intellectual Property [Member] | |
Subsequent Event [Line Items] | |
Stock issued during period, shares, issued for intellectual property rights | shares | 1,000,000 |