Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2024 | May 14, 2024 | |
Document and Entity Information | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Mar. 31, 2024 | |
Entity File Number | 001-41429 | |
Entity Registrant Name | PROMIS NEUROSCIENCES INC. | |
Entity Incorporation, State or Country Code | A6 | |
Entity Tax Identification Number | 98-0647155 | |
Entity Address, Address Line One | Suite 200, 1920 Yonge Street | |
Entity Address, City or Town | Toronto | |
Entity Address State Or Province | ON | |
Entity Address, Postal Zip Code | M4S 3E2 | |
City Area Code | 416 | |
Local Phone Number | 847-6898 | |
Title of 12(b) Security | Common Shares, no par value per share | |
Trading Symbol | PMN | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 18,961,116 | |
Entity Central Index Key | 0001374339 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2024 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Mar. 31, 2024 | Dec. 31, 2023 |
Current assets: | ||
Cash | $ 2,496,973 | $ 12,598,146 |
Short-term investments | 32,358 | 32,358 |
Prepaid expenses and other current assets | 1,018,969 | 988,641 |
Total current assets | 3,548,300 | 13,619,145 |
Total assets | 3,548,300 | 13,619,145 |
Current liabilities: | ||
Accounts payable | 1,403,592 | 7,843,136 |
Accrued liabilities | 1,242,322 | 1,506,526 |
Total current liabilities | 2,645,914 | 9,349,662 |
Share-based compensation liability | 716,969 | 422,002 |
Warrant liability | 108,318 | 94,185 |
Total liabilities | 3,471,201 | 9,865,849 |
Commitments and contingencies | ||
Shareholders' equity (deficit): | ||
Series 2 Convertible Preferred Shares, no par value, unlimited shares authorized, 1,166,667 shares issued and outstanding as of March 31, 2024 and December 31, 2023 | ||
Common shares, no par value, unlimited shares authorized, 18,961,116 and 18,885,254 shares issued and outstanding as of March 31, 2024 and December 31, 2023, respectively | ||
Additional paid-in capital | 97,549,317 | 97,590,426 |
Accumulated other comprehensive loss | (371,184) | (371,184) |
Accumulated deficit | (97,101,034) | (93,465,946) |
Total shareholders' equity (deficit) | 77,099 | 3,753,296 |
Total liabilities and shareholders' equity (deficit) | $ 3,548,300 | $ 13,619,145 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2024 | Dec. 31, 2023 |
Condensed Consolidated Balance Sheets | ||
Series S2 Convertible Preferred stock, Par value | $ 0 | $ 0 |
Series S2 Convertible Preferred Stock, Shares issued | 1,166,667 | 1,166,667 |
Series S2 Convertible Preferred Stock, Shares outstanding | 1,166,667 | 1,166,667 |
Common shares, par value (in dollars per share) | $ 0 | $ 0 |
Common shares, shares issued | 18,961,116 | 18,885,254 |
Common shares, shares outstanding | 18,961,116 | 18,885,254 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Loss - USD ($) | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Operating expenses: | ||
Research and development | $ 2,123,778 | $ 3,510,252 |
General and administrative | 1,552,873 | 1,460,419 |
Total operating expenses | 3,676,651 | 4,970,671 |
Loss from operations | (3,676,651) | (4,970,671) |
Other income (expense): | ||
Change in fair value of financial instruments | (14,132) | (41,665) |
Interest expense | (76,775) | |
Other income | 132,470 | 52,905 |
Total other income (expense), net | 41,563 | 11,240 |
Net loss | (3,635,088) | (4,959,431) |
Other comprehensive loss | ||
Foreign currency translation adjustment | (4,354) | |
Comprehensive loss | $ (3,635,088) | $ (4,963,785) |
Net loss per share, basic | $ (0.19) | $ (0.58) |
Net loss per share, diluted | $ (0.19) | $ (0.58) |
Weighted-average shares outstanding of common shares, basic | 19,533,976 | 8,579,284 |
Weighted-average shares outstanding of common shares, diluted | 19,533,976 | 8,579,284 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Changes in Shareholders' Equity (Deficit) - USD ($) | Series 2 Preferred Stock [Member] Preferred Stock Member | Series 1 Preferred Shares Member Preferred Stock Member | Common Shares | Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Accumulated Deficit | Total |
Balance at the beginning at Dec. 31, 2022 | $ 79,101,061 | $ (195,369) | $ (80,253,464) | $ (1,347,772) | |||
Balance at the beginning (in shares) at Dec. 31, 2022 | 70,000,000 | 8,579,284 | |||||
Changes in Shareholders' Deficit | |||||||
Share-based compensation | 132,510 | 132,510 | |||||
Foreign currency translation | (4,354) | (4,354) | |||||
Net Income (Loss) | (4,959,431) | (4,959,431) | |||||
Balance at the end at Mar. 31, 2023 | 79,233,571 | (199,723) | (85,212,895) | (6,179,047) | |||
Balance at the end (in shares) at Mar. 31, 2023 | 70,000,000 | 8,579,284 | |||||
Balance at the beginning at Dec. 31, 2023 | 97,590,426 | (371,184) | (93,465,946) | $ 3,753,296 | |||
Balance at the beginning (in shares) at Dec. 31, 2023 | 1,166,667 | 18,885,254 | 18,885,254 | ||||
Changes in Shareholders' Deficit | |||||||
Share-based compensation | 63,584 | $ 63,584 | |||||
Issuance of Common Shares from ATM Offering, net of issuance costs (shares) | 75,862 | ||||||
Issuance of Common Shares from ATM Offering, net of issuance costs (value) | 190,274 | 190,274 | |||||
Re-measurement of liability-classified CAD stock options as of March 31, 2024 | (294,967) | (294,967) | |||||
Net Income (Loss) | (3,635,088) | (3,635,088) | |||||
Balance at the end at Mar. 31, 2024 | $ 97,549,317 | $ (371,184) | $ (97,101,034) | $ 77,099 | |||
Balance at the end (in shares) at Mar. 31, 2024 | 1,166,667 | 18,961,116 | 18,961,116 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows - USD ($) | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Cash flows from operating activities | ||
Net loss | $ (3,635,088) | $ (4,959,431) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Share-based compensation | 63,584 | 132,510 |
Foreign currency exchange gain | (4,984) | |
Change in fair value of warrant liability | 14,133 | 41,665 |
Depreciation of property and equipment | 322 | |
Amortization of intangible assets | 1,233 | |
Changes in operating assets and liabilities: | ||
Prepaid expenses and other current assets | (30,328) | (45,966) |
Accounts payable | (6,439,544) | 4,002,389 |
Accrued liabilities | (264,204) | (1,729,392) |
Net cash used in operating activities | (10,291,447) | (2,561,654) |
Cash flows from financing activities | ||
Proceeds from issuance of Common Shares from ATM Offering, net of issuance costs | 190,274 | |
Net cash provided by financing activities | 190,274 | |
Effect of exchange rates on cash | 17,659 | |
Net decrease in cash | (10,101,173) | (2,543,995) |
Cash at beginning of year | 12,598,146 | 5,875,796 |
Cash at end of period | 2,496,973 | $ 3,331,801 |
Noncash financing activities | ||
Increase in share-based compensation liability on CAD denominated share options decreasing additional paid-in-capital | 294,967 | |
Supplemental disclosure of cash flow information | ||
Cash paid for interest | $ 76,775 |
DESCRIPTION OF BUSINESS
DESCRIPTION OF BUSINESS | 3 Months Ended |
Mar. 31, 2024 | |
DESCRIPTION OF BUSINESS | |
DESCRIPTION OF BUSINESS | 1. DESCRIPTION OF BUSINESS Business Description ProMIS Neurosciences Inc. (the “ Company ProMIS The Company is developing a pipeline of antibodies aimed at selectively targeting misfolded toxic forms of proteins that drive neurodegenerative diseases without interfering with the essential functions of the same properly folded proteins. The Company's product candidates are PMN310, PMN267, and PMN442. The lead product candidate is PMN310, a monoclonal antibody designed to treat AD by selectively targeting toxic, misfolded oligomers of amyloid-beta. PMN267 is our second lead product candidate targeting ALS. It has been shown in preclinical studies to selectively recognize misfolded, cytoplasmic TDP 43 aggregates without interacting with normal TDP 43. Misfolded TDP 43 is believed to play an important role in the development of ALS. In light of research suggesting that misfolded toxic a-syn is a primary driver of disease in synucleinopathies such as MSA and Parkinson’s disease, our third lead product candidate, PMN442, has shown robust binding to pathogenic a-syn oligomers and seeding fibrils in preclinical studies, with negligible binding to a-syn monomers and physiologic tetramers which are required for normal neuronal function. The Company was incorporated on January 23, 2004 under the Canada Business Corporations Act (“ CBCA OBCA Continuance Nasdaq ProMIS USA The success of the Company is dependent on obtaining the necessary regulatory approvals of its product candidates, marketing its products, if approved, and achieving profitable operations. The continuation of the research and development activities and the commercialization of its products, if approved, are dependent on the Company’s ability to successfully complete these activities and to obtain additional financing through a combination of financing activities and operations. It is not possible to predict either the outcome of future research and development or commercialization programs, the Company’s ability to fund these programs, or the Company’s ability to continue as a going concern. Liquidity Risk The accompanying unaudited condensed consolidated financial statements were prepared on a going concern basis, which assumes that the Company will continue its operations for the foreseeable future and will be able to realize its assets and discharge its liabilities in the normal course of business. The Company has not generated revenues from its activities. The Company had a net loss of $3.6 million for the three months ended March 31, 2024 and an accumulated deficit of $97.1 million as of March 31, 2024. Management believes these conditions raise substantial doubt about the Company’s ability to continue as a going concern within the next twelve months from the date these unaudited condensed consolidated financial statements are issued. The Company will require additional funding to conduct future clinical activities. The Company will seek additional funding through public and private financings, debt financings, collaboration agreements, strategic alliances and licensing agreements. Although the Company has been successful in raising capital in the past, there is no assurance of success in obtaining such additional financing on terms acceptable to us, if at all, and there is no assurance that the Company will be able to enter into collaborations or other arrangements. If the Company is unable to obtain funding, it could force delays, reduce or eliminate research and development programs, product portfolio expansion or commercialization efforts, which could adversely affect future business prospects, and the ability to continue operations. The Company may continue to incur net losses for at least the next several years as the Company advances its product candidates. The Company is actively pursuing additional financing to further develop certain of the Company’s scientific initiatives, but there is no assurance these initiatives will be successful, timely or sufficient. |
BASIS OF PRESENTATION AND SUMMA
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Mar. 31, 2024 | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 2. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying unaudited interim condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the related notes thereto for the year ended December 31, 2023, which are included with the Company’s Annual Report on Form 10-K and related amendments filed with the United States Securities Exchange Commission (“ SEC ) The accompanying unaudited interim condensed consolidated financial statements have been prepared in conformity with generally accepted accounting principles in the United States of America (“ GAAP ASC ASU FASB In the opinion of management, the accompanying unaudited interim condensed consolidated financial statements for the periods presented reflect all adjustments, consisting of only normal recurring adjustments, necessary to fairly present the Company’s financial position, results of operations, and cash flows. The December 31, 2023 condensed consolidated balance sheet was derived from audited financial statements, but does not include all GAAP disclosures. The unaudited condensed consolidated financial statements for the interim periods are not necessarily indicative of results for the full year. Principles of Consolidation The accompanying unaudited interim condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiary. All intercompany balances and transactions have been eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make certain estimates, judgements and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the unaudited condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates and assumptions made in the accompanying unaudited condensed consolidated financial statements include, but are not limited to, the accrual for research and development expenses and the valuation of warrant liabilities. Actual results could differ from those estimates, and such differences could be material to the unaudited condensed consolidated financial statements. Segment Information Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision maker (“ CODM Foreign and Functional Currency Prior to July 1, 2023, the Company’s functional currency was the Canadian dollar (“ C$ US$ Following the Company’s voluntary delisting from the Toronto Stock Exchange in July 2023, the Company reassessed its functional currency and determined that, as of July 1, 2023, its functional currency had changed from the C$ to the US$. The Company analysis included various factors, including: the Company’s cash flows and expenses denominated primarily in US$, the primary market for the Company’s Common Shares trading in US$ and a majority ownership by U.S. shareholders. The change in functional currency was accounted for prospectively from July 1, 2023 and consolidated financial statements prior to and including the period ended June 30, 2023 were not restated for the change in functional currency. For periods commencing July 1, 2023, monetary assets and liabilities denominated in foreign currencies are translated into US$ using exchange rates in effect at the end of the reporting period. Opening balances related to non-monetary assets and liabilities are based on prior period translated amounts, and non-monetary assets acquired, and non-monetary liabilities incurred after July 1, 2023 are translated at the approximate exchange rate prevailing at the date of the transaction. Revenue and expense transactions are translated at the approximate exchange rate in effect at the time of the transaction. Foreign exchange gains and losses are included in the consolidated statement of operations and comprehensive loss within operating expenses. Emerging Growth Company Status The Company is an Emerging Growth Company, as defined in Section 2(a) of the Securities Act of 1933, as modified by the Jumpstart Our Business Startups Act of 2012 (“ JOBS Act Recent Accounting Pronouncements In August 2020, the FASB issued ASU No. 2020-06, Debt—Debt with Conversion and Other Options ( Subtopic 470-20 ) and Derivatives and Hedging Contracts in Entity s Own Equity ( Subtopic 815-40 ): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity current GAAP. Convertible instruments that continue to be subject to separation models are (i) those with embedded conversion features that are not clearly and closely related to the host contract, that meet the definition of a derivative, and that do not qualify for a scope exception from derivative accounting and (ii) convertible debt instruments issued with substantial premiums for which the premiums are recorded as additional paid-in capital. ASU 2020-06 also amends the guidance for the derivatives scope exception for contracts in an entity’s own equity to reduce form-over-substance-based accounting conclusions. ASU 2020-06 will be effective for the Company for fiscal years beginning after December 15, 2023. Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. The Company adopted this standard effective January 1, 2024 with no material impact on the Company’s unaudited interim condensed consolidated financial statements. In 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures ASU 2023-07 In 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures ASU 2023-09 In 2024, the FASB issued ASU 2024-01, Compensation—Stock Compensation (Topic 718): Scope Application of Profits Interest and Similar Awards ASU 2024-01 |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 3 Months Ended |
Mar. 31, 2024 | |
FAIR VALUE MEASUREMENTS | |
FAIR VALUE MEASUREMENTS | 3. FAIR VALUE MEASUREMENTS The following are the major categories of assets and liabilities measured at fair value on a recurring basis as of March 31, 2024 and December 31, 2023: As of March 31, 2024 Level 1 Level 2 Level 3 Total Assets: Short-term investments $ 32,358 $ — $ — $ 32,358 Total assets measured at fair value $ 32,358 $ — $ — $ 32,358 Liabilities: Share-based compensation liability $ — $ — $ 716,969 $ 716,969 Warrant liability $ — $ — $ 108,318 $ 108,318 Total liabilities measured at fair value $ — $ — $ 825,287 $ 825,287 As of December 31, 2023 Level 1 Level 2 Level 3 Total Assets: Short-term investments $ 32,358 $ — $ — $ 32,358 Total assets measured at fair value $ 32,358 $ — $ — $ 32,358 Liabilities: Share-based compensation liability $ — $ — $ 422,002 $ 422,002 Warrant liability $ — $ — $ 94,185 $ 94,185 Total liabilities measured at fair value $ — $ — $ 516,187 $ 516,187 No transfers between levels have occurred in either reporting period presented. Refer to Note 7 below for disclosures related to the warrant liability and Note 8 for disclosures related to share-based compensation liability. |
PREPAID EXPENSES AND OTHER CURR
PREPAID EXPENSES AND OTHER CURRENT ASSETS | 3 Months Ended |
Mar. 31, 2024 | |
PREPAID EXPENSES AND OTHER CURRENT ASSETS | |
PREPAID EXPENSES AND OTHER CURRENT ASSETS | 4. PREPAID EXPENSES AND OTHER CURRENT ASSETS Prepaid expenses and other current assets consist of the following: March 31, December 31, 2024 2023 Upfront research payments $ 535,621 $ 146,851 Accrued interest and other receivables 76,805 78,637 Insurance 302,423 482,297 Consultants — 21,535 License fees 80,588 30,472 Deferred financing costs — 195,632 Miscellaneous 23,532 33,217 Total prepaid expenses and other current assets $ 1,018,969 $ 988,641 |
ACCRUED LIABILITIES AND ACCOUNT
ACCRUED LIABILITIES AND ACCOUNTS PAYABLE | 3 Months Ended |
Mar. 31, 2024 | |
ACCRUED LIABILITIES AND ACCOUNTS PAYABLE | |
ACCRUED LIABILITIES AND ACCOUNTS PAYABLE | 5. ACCRUED LIABILITIES AND ACCOUNTS PAYABLE Accrued liabilities consist of the following: March 31, December 31, 2024 2023 Legal $ 36,068 $ 66,254 Deferred financing costs — 99,883 Accounting 107,749 101,528 Research and development 654,977 691,908 Severance 403,319 518,704 Other 40,209 28,249 Accrued liabilities $ 1,242,322 $ 1,506,526 Accounts payable are current obligations due to vendors. In May 2023, the Company entered into an agreement with a vendor which gave the option to defer payment on approximately $5.5 million of current accounts payable and accrued liabilities until March 31, 2024. As of December 31, 2023, the amount outstanding under the agreement recorded in accounts payable was $5.7 million. The Company made a cash payment of approximately $5.9 million to settle the entirety of the amount outstanding under the agreement in March 2024. |
EQUITY
EQUITY | 3 Months Ended |
Mar. 31, 2024 | |
EQUITY | |
EQUITY | 6. EQUITY The Company has authorized an unlimited number of both Common and Preferred Shares. As of March 31, 2024 and December 31, 2023, the Company had 18,961,116 and 18,885,254 issued outstanding Common Shares reserved for future issuance consists of the following: March 31, December 31, 2024 2023 Warrants 13,456,328 13,595,987 Series 2 Convertible Preferred Shares 1,166,667 1,166,667 Options issued and outstanding under stock option plan 1,152,597 898,262 Deferred Share Units 1,061 1,061 Common Shares available for grant under stock option plan 2,639,626 471,843 Total Common Shares reserved for future issuance 18,416,279 16,133,820 The preferences, privileges and rights of the Common Shares are as follows: Voting Subject to any special voting rights or restrictions, holders of Common Shares entitled to vote shall have one vote per share. Dividends The Company’s Board of Directors may from time to time declare and authorize payment of dividends, if any, as they may deem advisable and need not give notice of such declaration to any shareholder. Subject to the rights of common shareholders, if any, holding shares with specific rights as to dividends, all dividends on Common Shares shall be declared and paid according to the number of such shares held and paid in Canadian dollars. Liquidation Rights In the event of the liquidation, dissolution or winding-up of the Company or any other distribution of the Company’s assets for the purpose of winding up the Company’s affairs, after the payment of dividends declared but unpaid, the holders of Common Shares shall be entitled pari passu Series 2 Convertible Preferred Shares In November 2023, the directors of the Company authorized the issuance of an unlimited number of Series 2 Convertible Preferred Shares (“Series 2 Shares”). In December 2023, the Company entered into an agreement with the Series 1 Shareholders to exchange all 70,000,000 outstanding Series 1 Shares for 1,166,667 Series 2 Shares (an equivalent number of as-converted Common Shares) The Series 2 Shares have the following preferences, privileges and rights: Dividends If the Company declares, pays or sets aside any dividends on shares of any other class or series of capital stock the holders of the Preferred Shares shall receive a dividend on each outstanding share of Preferred Share in an amount equal to that dividend per share of the Preferred Share as would equal the product of the dividend payable as if all shares of such series had been converted into Common Shares. Liquidation In the event of any voluntary or involuntary liquidation, dissolution or winding up of the Company, the holders of the Series 2 Shares shall be entitled to be paid out of the assets of the Company available for distribution to the shareholders an amount per share equal to $6.00, plus any dividends declared but not paid. If, upon any such liquidation event, the assets available for distribution to the shareholders are insufficient to pay the holders of the Series 2 Shares, the holders of the Series 2 Shares shall share ratably in any distribution of the assets available for distribution in proportion to the respective amounts which would otherwise be payable in respect of the shares held by them upon such distribution if all amounts payable on or with respect to such shares were paid in full. Voting The Preferred Shares do not confer any voting rights or privileges. Redemption The Preferred Shares are not subject to mandatory redemption or other redemption provisions for which the events resulting in redemption are not within the Company’s control. Optional Conversion Series 2 Shares are convertible, at the option of the holder thereof, at any time and from time to time, and without the payment of additional consideration by the holder thereof, at a ratio of 1 Series 2 Share into 1 Common Share. Mandatory Conversion All outstanding Series 2 Shares shall automatically convert into Common Shares, at the effective conversion rate upon the closing of one singular financing, including a financing with multiple tranches in which any subsequent tranches are closed within 18 months of the initial closing, which financing results in at least single sale, executable in one or more tranches, of equity securities resulting in at least $14.0 million of cumulative gross proceeds to the Company. Equity Transactions Following the change in functional currency effective July 1, 2023, the Company reassessed the classification of its historical US$ and C$ denominated warrants in accordance with the Company’s accounting policy for warrants. As a result of the reassessment, the Company determined that 870,026 US$ warrants to purchase Common Shares, originally issued in financing transactions in 2021 and 2022, previously classified as warrant liabilities met the criteria under ASC 815-40 for permanent equity classification. The US$ warrants with a total fair value of $1,287,400, calculated using a Black Scholes calculation as of June 30, 2023, were reclassified from warrant liability to additional-paid-in-capital in the accompanying unaudited condensed consolidated financial statements. The fair value of the US$ warrants represented the entirety of the Company’s warrant liability as of June 30, 2023. The US$ warrants will not be re-measured prospectively. As result of the reassessment the Company determined that 687,591 C$ warrants, originally issued in financing transactions between 2018 and 2020, which were previously classified in permanent equity no longer met the criteria for equity classification. The C$ warrants were remeasured as of July 1, 2023. The C$ warrants have exercise prices between C$12.00 and C$18.00 and expire between June 2024 and November 2025. The C$ warrants liability was re-measured at December 31, 2023 to a fair value of $94,185. The C$ warrants liability was re-measured at March 31, 2024 to a fair value of $108,318, with the change in fair value of $14,132 reported in other income in the accompanying unaudited condensed consolidated statement of operations and comprehensive loss. The weighted-average values of the significant assumptions used in the Black Scholes valuation of the C$ warrants as of December 31, 2023 included volatility of 131.5%, a risk-free rate of 3.88%, exercise price of C$10.80 and an expected term of 1.7 years. The weighted-average values of the significant assumptions used in the Black Scholes valuation of the C$ warrants as of March 31, 2024 included volatility of 108.9%, a risk-free rate of 4.29%, exercise price of C$12.28 and an expected term of 1.6 years. A summary of warrant liability activity for the three-month period ended March 31, 2024 is as follows: March 31, 2024 Balance at December 31, 2023 $ 94,185 Change in fair value of C$ warrant liability 14,133 Balance at March 31, 2024 $ 108,318 December 31, 2023 Balance at December 31, 2022 $ 1,859,374 October 2022 PIPE warrant liability at issuance — Change in fair value of the warrant liability (564,548) Foreign exchange loss (7,426) Fair value of US$ warrant liability as of June 30, 2023 1,287,400 Fair value of previously liability-classified US$ warrants reclassified to additional paid-in-capital as of July 1, 2023 (1,287,400) Fair value of previously equity-classified C$ warrants reclassified to warrant liability as of July 1, 2023 396,375 Change in fair value of C$ warrant liability (302,190) Balance at December 31, 2023 $ 94,185 At-the-Market Offering (ATM) In September 2023, the Company filed a shelf registration statement with the SEC. In conjunction with the shelf registration, the Company entered into an ATM agreement in January 2024 to offer up to $25.0 million of the Company’s Common Shares. During the three months ended March 31, 2024, the Company sold 75,862 Common Shares for net proceeds of $190,274 after deducting sales commissions. |
WARRANTS
WARRANTS | 3 Months Ended |
Mar. 31, 2024 | |
WARRANTS | |
WARRANTS | 7. WARRANTS As of March 31, 2024, outstanding Common Share warrants and exercise prices related to unit offerings are as follows: Exercise Number of Price $ Warrants Expiry date C$18.00 68,334 June 2024 C$18.00 150,818 November 2024 C$18.00 49,167 December 2024 C$12.00 279,613 November 2025 US$12.60 524,088 August 2026 US$9.60 146,744 August 2026 US$7.50 345,938 April 2028 US$6.10 69,188 April 2028 US$0.01 594,724 None US$1.75 11,227,714 February 2029 13,456,328 In January 2024, 139,659 warrants with an exercise price of C$28.80 expired without being exercised. There were no warrant exercises in the three months ended March 31, 2024. |
SHARE-BASED COMPENSATION
SHARE-BASED COMPENSATION | 3 Months Ended |
Mar. 31, 2024 | |
SHARE-BASED COMPENSATION | |
SHARE-BASED COMPENSATION | 8. SHARE-BASED COMPENSATION 2015 Stock Option Plan The Company maintains the 2015 Stock Option Plan ( “2015 Option Plan” Canadian Dollar Share Options The following table summarizes the C$ share options outstanding under the 2015 Option Plan for the three months ended March 31, 2024. All amounts are denominated in C$, except year and share amounts: Weighted Weighted Average Average Remaining Number of Exercise Contractual Aggregate Share Price Per Term Intrinsic Options Share (years) Value Outstanding as of December 31, 2023 898,262 $ 7.58 6.5 $ — Expired (14,665) 18.30 Outstanding as of March 31, 2024 883,597 7.40 6.4 27,581 Vested and exercisable as of March 31, 2024 793,570 $ 7.29 6.4 $ 27,581 The aggregate intrinsic value of options outstanding and vested and exercisable is calculated as the difference between the exercise price of the underlying options, and the fair value of the Company’s Common Shares when the exercise price is below fair value. There were no C$ options exercised Upon the change in the Company’s functional currency effective July 1, 2023 C$ share options previously classified as equity were reclassified as liabilities. The C$ options were re-measured as of December 31, 2023 and had a fair value of $442,002. The C$ options were re-measured as of March 31, 2024 and had a fair value of $716,969, resulting in an increase to the fair value of the liability and a decrease from additional paid-in-capital of $294,967. The following table summarizes the weighted average of significant assumptions used to calculate the fair value of C$ share options outstanding and exercisable as of March 31, 2024 and December 31, 2023: Period Ended March 31, December 31, 2024 2023 Weighted average fair value of C$ Options C$ 0.90 C$ 0.53 Expected volatility 102.3 % 116.3 % Risk-free interest rate 4.39 % 4.04 % Expected dividend yield — % — % Expected term (years) 6.4 6.5 Expected volatility is based on historical volatility of the Company’s Common Shares over the expected life of the option, as the Company’s options are not readily tradable. US Dollar Share Options The following table summarizes the US$ share options outstanding under the 2015 Option Plan for the three months ended March 31, 2024. All amounts are denominated in US$, except year and share amounts: Weighted Weighted Average Average Remaining Number of Exercise Contractual Aggregate Share Price Per Term Intrinsic Options Share (years) Value Outstanding as of December 31, 2023 69,000 $ 1.87 $ — Granted 200,000 1.17 44,000 Outstanding as of March 31, 2024 269,000 1.35 9.7 150,760 Vested and exercisable as of March 31, 2024 58,333 $ 1.17 9.7 $ 43,166 During the three months ended March 31, 2024, the Company granted US$ share options with a grant date fair value of $182,820. During the three months ended March 31, 2024 there were no US$ share options exercised. The fair value of the share options granted was estimated using Black Scholes with the following assumptions: Three Months Ended March 31, 2024 Weighted average fair value of US$ Options $ 0.91 Expected volatility 98.6 % Risk-free interest rate 3.90 % Expected dividend yield — % Expected term (years) 5.8 Share-based Payment Expense The following table summarizes total share-based compensation included in the Company’s accompanying unaudited condensed consolidated statements of operations and comprehensive loss: Three Months Ended March 31, 2024 2023 Research and development $ 3,812 $ 38,909 General and administrative 59,772 93,601 Total share-based compensation $ 63,584 $ 132,510 As of March 31, 2024, there was $133,005 of unrecognized share-based compensation liability related to C$ options outstanding but unvested, which is expected to be recognized over weighted-average remaining service period of 2.0 years. There was $220,184 of unrecognized share-based compensation expense related to US$ options outstanding but unvested, which is expected to be recognized over the remaining service period of 3.1 years. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 3 Months Ended |
Mar. 31, 2024 | |
RELATED PARTY TRANSACTIONS | |
RELATED PARTY TRANSACTIONS | 9. RELATED PARTY TRANSACTIONS UBC Collaborative Research Agreement In April 2016, the Company entered into a collaborative research agreement (“ CRA UBC |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Mar. 31, 2024 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | 10. COMMITMENTS AND CONTINGENCIES Research, Development and License Agreements The Company enters into research, development and license agreements with various parties in the ordinary course of business where the Company receives research services and rights to proprietary technologies. The agreements require compensation to be paid by the Company, typically, by a combination of the following: ● fees comprising amounts due initially on entering into the agreements and additional amounts due either on specified timelines or defined services to be provided; ● milestone payments that are dependent on products developed under the agreements proceeding toward specified plans of clinical trials and commercial development; and ● royalty payments calculated as a percentage of net sales, commencing on commercial sale of any product candidates developed from the technologies. Milestone and royalty related amounts that may come due under various agreements are dependent on, among other factors, preclinical safety and efficacy, clinical trials, regulatory approvals and, ultimately, the successful development and commercial launch of a new drug, the outcomes and timings of which are uncertain. Amounts due per the various agreements for milestone payments will accrue once the occurrence of a milestone is likely. Amounts due as royalty payments will accrue as commercial revenues from the product are earned. Through September 30, 2023, no events have occurred that require accrual of any milestone or royalty related amounts. UBC and the Vancouver Coastal Health Authority Agreement In April 2016, the Company entered into a three-year, CRA with the UBC and the Vancouver Coastal Health Authority. The agreement was amended various times through January 2022, extending the agreement through 2025. Refer to Note 9 Related Party Transactions. UBC Agreement In February 2009, the Company entered into an agreement with UBC to further the development and commercialization of certain technology developed, in part, by the Company’s Chief Scientific Officer. The agreement was amended and restated in October 2015. Under the amended and restated agreement, the Company is committed to make royalty payments based on revenue earned from the licensed technology. An annual license fee is payable over the term of the agreement. The agreement remains effective unless terminated under the provisions of the agreement. The Company made annual license payments of C$25,000 during the three months ended March 31, 2024 and 2023. Through March 31, 2024, no accruals for royalty payments have been made. Indemnification In the ordinary course of business, the Company enters into agreements that may include indemnification provisions. Pursuant to such agreements, the Company may indemnify, hold harmless and defend an indemnified party for losses suffered or incurred by the indemnified party. Some of the provisions will limit losses to those arising from third party actions. In some cases, the indemnification will continue after the termination of the agreement. The maximum potential amount of future payments the Company could be required to make under these provisions is not determinable. The Company has never incurred material costs to defend lawsuits or settle claims related to these indemnification provisions. The Company has also entered into indemnification agreements with its directors and officers that may require the Company to indemnify its directors and officers against liabilities that may arise by reason of their status or service as directors or officers. The Company currently has directors’ and officers’ insurance. |
NET LOSS PER SHARE
NET LOSS PER SHARE | 3 Months Ended |
Mar. 31, 2024 | |
NET LOSS PER SHARE | |
NET LOSS PER SHARE | 11. NET LOSS PER SHARE Basic net earnings per share applicable to common stockholders is calculated by dividing net earnings applicable to common shareholders by the weighted average shares outstanding during the period, without consideration for common share equivalents. Diluted net earnings per share applicable to common shareholders is calculated by adjusting the weighted average shares outstanding for the dilutive effect of common share equivalents outstanding for the period, determined using the treasury-stock method and the if-converted method. For purposes of the calculation of dilutive net loss per share applicable to common shareholders, stock options, and warrants are considered to be common stock equivalents but are excluded from the calculation of diluted net loss per share applicable to common shareholders, as their effect would be anti-dilutive; therefore, basic and diluted net loss per share applicable to common shareholders were the same for all periods presented. As of March 31, 2024, 594,724 Pre-Funded Warrants to purchase common shares for little to no consideration, issued in connection with the August 2023 private placement, were included in the basic and diluted net loss per share calculation. The following table sets forth the computation of basic and diluted net loss per share attributable to common shareholders: Three Months Ended March 31, 2024 2023 Numerator: Net loss attributable to common shareholders $ (3,635,088) $ (4,959,431) Denominator: Weighted-average shares outstanding used in computing net loss per share attributable to common shareholders, basic and diluted 19,533,976 8,579,284 Net loss per share attributable to common shareholders, basic and diluted $ 0.19 $ 0.58 The following outstanding potentially dilutive Common Shares equivalents were excluded from the computation of diluted net loss per share for the periods presented because including them would have been antidilutive: March 31, 2024 2023 Options issued and outstanding under stock option plan 1,152,597 1,043,025 Warrants 12,861,604 1,873,622 Series 1 Convertible Preferred Shares — 1,166,667 Series 2 Convertible Preferred Shares 1,166,667 — Deferred Share Units 1,061 1,061 Total 15,181,929 4,084,375 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Mar. 31, 2024 | |
SUBSEQUENT EVENTS | |
SUBSEQUENT EVENTS | 12. SUBSEQUENT EVENTS The Company did not identify any subsequent events through May 14, 2024, the date these unaudited condensed consolidated financial statements were issued. |
BASIS OF PRESENTATION AND SUM_2
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Mar. 31, 2024 | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Basis of Presentation | Basis of Presentation The accompanying unaudited interim condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the related notes thereto for the year ended December 31, 2023, which are included with the Company’s Annual Report on Form 10-K and related amendments filed with the United States Securities Exchange Commission (“ SEC ) The accompanying unaudited interim condensed consolidated financial statements have been prepared in conformity with generally accepted accounting principles in the United States of America (“ GAAP ASC ASU FASB In the opinion of management, the accompanying unaudited interim condensed consolidated financial statements for the periods presented reflect all adjustments, consisting of only normal recurring adjustments, necessary to fairly present the Company’s financial position, results of operations, and cash flows. The December 31, 2023 condensed consolidated balance sheet was derived from audited financial statements, but does not include all GAAP disclosures. The unaudited condensed consolidated financial statements for the interim periods are not necessarily indicative of results for the full year. |
Principles of Consolidation | Principles of Consolidation The accompanying unaudited interim condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiary. All intercompany balances and transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make certain estimates, judgements and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the unaudited condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates and assumptions made in the accompanying unaudited condensed consolidated financial statements include, but are not limited to, the accrual for research and development expenses and the valuation of warrant liabilities. Actual results could differ from those estimates, and such differences could be material to the unaudited condensed consolidated financial statements. |
Segment Information | Segment Information Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision maker (“ CODM |
Foreign and Functional Currency | Foreign and Functional Currency Prior to July 1, 2023, the Company’s functional currency was the Canadian dollar (“ C$ US$ Following the Company’s voluntary delisting from the Toronto Stock Exchange in July 2023, the Company reassessed its functional currency and determined that, as of July 1, 2023, its functional currency had changed from the C$ to the US$. The Company analysis included various factors, including: the Company’s cash flows and expenses denominated primarily in US$, the primary market for the Company’s Common Shares trading in US$ and a majority ownership by U.S. shareholders. The change in functional currency was accounted for prospectively from July 1, 2023 and consolidated financial statements prior to and including the period ended June 30, 2023 were not restated for the change in functional currency. For periods commencing July 1, 2023, monetary assets and liabilities denominated in foreign currencies are translated into US$ using exchange rates in effect at the end of the reporting period. Opening balances related to non-monetary assets and liabilities are based on prior period translated amounts, and non-monetary assets acquired, and non-monetary liabilities incurred after July 1, 2023 are translated at the approximate exchange rate prevailing at the date of the transaction. Revenue and expense transactions are translated at the approximate exchange rate in effect at the time of the transaction. Foreign exchange gains and losses are included in the consolidated statement of operations and comprehensive loss within operating expenses. |
Emerging Growth Company Status | Emerging Growth Company Status The Company is an Emerging Growth Company, as defined in Section 2(a) of the Securities Act of 1933, as modified by the Jumpstart Our Business Startups Act of 2012 (“ JOBS Act |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In August 2020, the FASB issued ASU No. 2020-06, Debt—Debt with Conversion and Other Options ( Subtopic 470-20 ) and Derivatives and Hedging Contracts in Entity s Own Equity ( Subtopic 815-40 ): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity current GAAP. Convertible instruments that continue to be subject to separation models are (i) those with embedded conversion features that are not clearly and closely related to the host contract, that meet the definition of a derivative, and that do not qualify for a scope exception from derivative accounting and (ii) convertible debt instruments issued with substantial premiums for which the premiums are recorded as additional paid-in capital. ASU 2020-06 also amends the guidance for the derivatives scope exception for contracts in an entity’s own equity to reduce form-over-substance-based accounting conclusions. ASU 2020-06 will be effective for the Company for fiscal years beginning after December 15, 2023. Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. The Company adopted this standard effective January 1, 2024 with no material impact on the Company’s unaudited interim condensed consolidated financial statements. In 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures ASU 2023-07 In 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures ASU 2023-09 In 2024, the FASB issued ASU 2024-01, Compensation—Stock Compensation (Topic 718): Scope Application of Profits Interest and Similar Awards ASU 2024-01 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
FAIR VALUE MEASUREMENTS | |
Summary of major categories of assets and liabilities measured at fair value on a recurring basis | As of March 31, 2024 Level 1 Level 2 Level 3 Total Assets: Short-term investments $ 32,358 $ — $ — $ 32,358 Total assets measured at fair value $ 32,358 $ — $ — $ 32,358 Liabilities: Share-based compensation liability $ — $ — $ 716,969 $ 716,969 Warrant liability $ — $ — $ 108,318 $ 108,318 Total liabilities measured at fair value $ — $ — $ 825,287 $ 825,287 As of December 31, 2023 Level 1 Level 2 Level 3 Total Assets: Short-term investments $ 32,358 $ — $ — $ 32,358 Total assets measured at fair value $ 32,358 $ — $ — $ 32,358 Liabilities: Share-based compensation liability $ — $ — $ 422,002 $ 422,002 Warrant liability $ — $ — $ 94,185 $ 94,185 Total liabilities measured at fair value $ — $ — $ 516,187 $ 516,187 |
PREPAID EXPENSES AND OTHER CU_2
PREPAID EXPENSES AND OTHER CURRENT ASSETS (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
PREPAID EXPENSES AND OTHER CURRENT ASSETS | |
Summary of prepaid expenses and other current assets | March 31, December 31, 2024 2023 Upfront research payments $ 535,621 $ 146,851 Accrued interest and other receivables 76,805 78,637 Insurance 302,423 482,297 Consultants — 21,535 License fees 80,588 30,472 Deferred financing costs — 195,632 Miscellaneous 23,532 33,217 Total prepaid expenses and other current assets $ 1,018,969 $ 988,641 |
ACCRUED LIABILITIES AND ACCOU_2
ACCRUED LIABILITIES AND ACCOUNTS PAYABLE (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
ACCRUED LIABILITIES AND ACCOUNTS PAYABLE | |
Summary of accrued liabilities | March 31, December 31, 2024 2023 Legal $ 36,068 $ 66,254 Deferred financing costs — 99,883 Accounting 107,749 101,528 Research and development 654,977 691,908 Severance 403,319 518,704 Other 40,209 28,249 Accrued liabilities $ 1,242,322 $ 1,506,526 |
EQUITY (Tables)
EQUITY (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
EQUITY | |
Summary of common shares reserved for future issuance | March 31, December 31, 2024 2023 Warrants 13,456,328 13,595,987 Series 2 Convertible Preferred Shares 1,166,667 1,166,667 Options issued and outstanding under stock option plan 1,152,597 898,262 Deferred Share Units 1,061 1,061 Common Shares available for grant under stock option plan 2,639,626 471,843 Total Common Shares reserved for future issuance 18,416,279 16,133,820 |
Summary of fair value of the warrant liability | March 31, 2024 Balance at December 31, 2023 $ 94,185 Change in fair value of C$ warrant liability 14,133 Balance at March 31, 2024 $ 108,318 December 31, 2023 Balance at December 31, 2022 $ 1,859,374 October 2022 PIPE warrant liability at issuance — Change in fair value of the warrant liability (564,548) Foreign exchange loss (7,426) Fair value of US$ warrant liability as of June 30, 2023 1,287,400 Fair value of previously liability-classified US$ warrants reclassified to additional paid-in-capital as of July 1, 2023 (1,287,400) Fair value of previously equity-classified C$ warrants reclassified to warrant liability as of July 1, 2023 396,375 Change in fair value of C$ warrant liability (302,190) Balance at December 31, 2023 $ 94,185 |
WARRANTS (Tables)
WARRANTS (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
WARRANTS | |
Schedule of warrant exercise price | Exercise Number of Price $ Warrants Expiry date C$18.00 68,334 June 2024 C$18.00 150,818 November 2024 C$18.00 49,167 December 2024 C$12.00 279,613 November 2025 US$12.60 524,088 August 2026 US$9.60 146,744 August 2026 US$7.50 345,938 April 2028 US$6.10 69,188 April 2028 US$0.01 594,724 None US$1.75 11,227,714 February 2029 13,456,328 |
SHARE-BASED COMPENSATION (Table
SHARE-BASED COMPENSATION (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
SHARE-BASED COMPENSATION | |
Summary of the activity of share options | Weighted Weighted Average Average Remaining Number of Exercise Contractual Aggregate Share Price Per Term Intrinsic Options Share (years) Value Outstanding as of December 31, 2023 898,262 $ 7.58 6.5 $ — Expired (14,665) 18.30 Outstanding as of March 31, 2024 883,597 7.40 6.4 27,581 Vested and exercisable as of March 31, 2024 793,570 $ 7.29 6.4 $ 27,581 Weighted Weighted Average Average Remaining Number of Exercise Contractual Aggregate Share Price Per Term Intrinsic Options Share (years) Value Outstanding as of December 31, 2023 69,000 $ 1.87 $ — Granted 200,000 1.17 44,000 Outstanding as of March 31, 2024 269,000 1.35 9.7 150,760 Vested and exercisable as of March 31, 2024 58,333 $ 1.17 9.7 $ 43,166 |
Summary of fair value of share options granted estimated using Black Scholes with the assumptions | Period Ended March 31, December 31, 2024 2023 Weighted average fair value of C$ Options C$ 0.90 C$ 0.53 Expected volatility 102.3 % 116.3 % Risk-free interest rate 4.39 % 4.04 % Expected dividend yield — % — % Expected term (years) 6.4 6.5 Three Months Ended March 31, 2024 Weighted average fair value of US$ Options $ 0.91 Expected volatility 98.6 % Risk-free interest rate 3.90 % Expected dividend yield — % Expected term (years) 5.8 |
Summary of total share-based compensation | Three Months Ended March 31, 2024 2023 Research and development $ 3,812 $ 38,909 General and administrative 59,772 93,601 Total share-based compensation $ 63,584 $ 132,510 |
NET LOSS PER SHARE (Tables)
NET LOSS PER SHARE (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
NET LOSS PER SHARE | |
Summary of computation of basic and diluted net loss per share attributable to common shareholders | Three Months Ended March 31, 2024 2023 Numerator: Net loss attributable to common shareholders $ (3,635,088) $ (4,959,431) Denominator: Weighted-average shares outstanding used in computing net loss per share attributable to common shareholders, basic and diluted 19,533,976 8,579,284 Net loss per share attributable to common shareholders, basic and diluted $ 0.19 $ 0.58 |
Summary of outstanding potentially dilutive common shares equivalents were excluded from the computation of diluted net loss per share | March 31, 2024 2023 Options issued and outstanding under stock option plan 1,152,597 1,043,025 Warrants 12,861,604 1,873,622 Series 1 Convertible Preferred Shares — 1,166,667 Series 2 Convertible Preferred Shares 1,166,667 — Deferred Share Units 1,061 1,061 Total 15,181,929 4,084,375 |
DESCRIPTION OF BUSINESS (Detail
DESCRIPTION OF BUSINESS (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
DESCRIPTION OF BUSINESS | |||
Net Income (Loss) | $ (3,635,088) | $ (4,959,431) | |
Accumulated deficit | $ (97,101,034) | $ (93,465,946) |
BASIS OF PRESENTATION AND SUM_3
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) | 3 Months Ended |
Mar. 31, 2024 segment | |
Segment Information | |
Number of operating segment | 1 |
FAIR VALUE MEASUREMENTS - Asset
FAIR VALUE MEASUREMENTS - Assets measured at fair value on a recurring basis (Details) - USD ($) | Mar. 31, 2024 | Dec. 31, 2023 |
Liabilities: | ||
Warrant liability | $ 108,318 | $ 94,185 |
Recurring | ||
Assets: | ||
Short-term investments | 32,358 | 32,358 |
Total assets measured at fair value | 32,358 | 32,358 |
Liabilities: | ||
Share-based compensation liability | 716,969 | 422,002 |
Warrant liability | 108,318 | 94,185 |
Total liabilities measured at fair value | 825,287 | 516,187 |
Recurring | Level 1 | ||
Assets: | ||
Short-term investments | 32,358 | 32,358 |
Total assets measured at fair value | 32,358 | 32,358 |
Recurring | Level 3 | ||
Liabilities: | ||
Share-based compensation liability | 716,969 | 422,002 |
Warrant liability | 108,318 | 94,185 |
Total liabilities measured at fair value | $ 825,287 | $ 516,187 |
FAIR VALUE MEASUREMENTS - Addit
FAIR VALUE MEASUREMENTS - Additional information (Details) - USD ($) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2024 | Dec. 31, 2023 | |
FAIR VALUE MEASUREMENTS | ||
Transfer of assets (liabilities) in and out of level 1 | $ 0 | $ 0 |
Transfer of assets (liabilities) in and out of level 2 | 0 | 0 |
Transfer of assets in and out of level 3 | 0 | 0 |
Transfer of liabilities in and out of level 3 | $ 0 | $ 0 |
PREPAID EXPENSES AND OTHER CU_3
PREPAID EXPENSES AND OTHER CURRENT ASSETS (Details) - USD ($) | Mar. 31, 2024 | Dec. 31, 2023 |
PREPAID EXPENSES AND OTHER CURRENT ASSETS | ||
Upfront research payments | $ 535,621 | $ 146,851 |
Accrued interest and other receivables | 76,805 | 78,637 |
Insurance | 302,423 | 482,297 |
Consultants | 21,535 | |
License fees | 80,588 | 30,472 |
Deferred financing costs | 195,632 | |
Miscellaneous | 23,532 | 33,217 |
Total prepaid expenses and other current assets | $ 1,018,969 | $ 988,641 |
ACCRUED LIABILITIES AND ACCOU_3
ACCRUED LIABILITIES AND ACCOUNTS PAYABLE (Details) - USD ($) | Mar. 31, 2024 | Dec. 31, 2023 |
ACCRUED LIABILITIES AND ACCOUNTS PAYABLE | ||
Legal | $ 36,068 | $ 66,254 |
Deferred financing costs | 99,883 | |
Accounting | 107,749 | 101,528 |
Research and development | 654,977 | 691,908 |
Severance | 403,319 | 518,704 |
Other | 40,209 | 28,249 |
Accrued liabilities | $ 1,242,322 | $ 1,506,526 |
ACCRUED LIABILITIES AND ACCOU_4
ACCRUED LIABILITIES AND ACCOUNTS PAYABLE - Vendor agreement (Details) - USD ($) | Mar. 31, 2024 | Dec. 31, 2023 | May 31, 2023 |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Accounts payable | $ 1,403,592 | $ 7,843,136 | |
Vendor Member | |||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Accounts payable | $ 5,900,000 | $ 5,700,000 | $ 5,500,000 |
EQUITY (Details)
EQUITY (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2024 | Dec. 31, 2023 | |
EQUITY | ||
Common shares, shares issued | 18,961,116 | 18,885,254 |
Common shares, shares outstanding | 18,961,116 | 18,885,254 |
Series S2 Convertible Preferred Stock, Shares issued | 1,166,667 | 1,166,667 |
Series S2 Convertible Preferred Stock, Shares outstanding | 1,166,667 | 1,166,667 |
Common shares, par value (in dollars per share) | $ 0 | $ 0 |
Proceeds from issuance of Common Shares from ATM Offering, net of issuance costs | $ 190,274 |
EQUITY - Future issuance (Detai
EQUITY - Future issuance (Details) - shares | Mar. 31, 2024 | Dec. 31, 2023 |
EQUITY | ||
Warrants | 13,456,328 | 13,595,987 |
Series 2 Convertible Preferred Shares | 1,166,667 | 1,166,667 |
Options issued and outstanding under stock option plan | 1,152,597 | 898,262 |
Deferred Share Units | 1,061 | 1,061 |
Common Shares available for grant under stock option plan | 2,639,626 | 471,843 |
Total Common Shares reserved for future issuance | 18,416,279 | 16,133,820 |
EQUITY - Rights of the common s
EQUITY - Rights of the common shares gross proceeds (Details) $ / shares in Units, $ in Millions | 3 Months Ended | |
Mar. 31, 2024 USD ($) Vote $ / shares | Nov. 30, 2023 shares | |
Class of Stock [Line Items] | ||
Number of vote per share | Vote | 1 | |
Liquidation preference per share | $ / shares | $ 6 | |
Mandatory Conversion Preferred Stock, value, outstanding | $ | $ 14 | |
Series 2 Preferred Stock | ||
Class of Stock [Line Items] | ||
Number of preferred stock convertible | 70,000,000 | |
Conversion of convertible shares | 1,166,667 |
EQUITY - Equity transactions (D
EQUITY - Equity transactions (Details) | 3 Months Ended | ||||
Jul. 01, 2023 USD ($) shares | Mar. 31, 2024 USD ($) Y $ / shares | Mar. 31, 2023 USD ($) | Dec. 31, 2023 USD ($) $ / shares Y | Jul. 01, 2023 $ / shares | |
Class of Stock [Line Items] | |||||
Warrant liability | $ 108,318 | $ 94,185 | |||
Change in fair value of warrant liability | 14,133 | $ 41,665 | |||
Proceeds from issuance of Common Shares from ATM Offering, net of issuance costs | 190,274 | ||||
United States dollar denominated warrants | |||||
Class of Stock [Line Items] | |||||
Number of warrants reclassified to permanent equity due to change in functional currency | shares | 870,026 | ||||
Warrants with fair value | $ 1,287,400 | ||||
Canadian dollar denominated warrants | |||||
Class of Stock [Line Items] | |||||
Number of warrants reclassified to warrant liability due to change in functional currency | shares | 687,591 | ||||
Canadian dollar denominated warrants | Nonoperating Income (Expense) | |||||
Class of Stock [Line Items] | |||||
Warrant liability | 108,318 | $ 94,185 | |||
Change in fair value of warrant liability | $ 14,132 | ||||
Canadian dollar denominated warrants | Minimum | |||||
Class of Stock [Line Items] | |||||
Exercise price of warrant | $ / shares | $ 12 | ||||
Canadian dollar denominated warrants | Maximum | |||||
Class of Stock [Line Items] | |||||
Exercise price of warrant | $ / shares | $ 18 | ||||
Volatility | Canadian dollar denominated warrants | |||||
Class of Stock [Line Items] | |||||
Warrants, measurement input | 1.089 | 1.315 | |||
Risk-free interest rate | Canadian dollar denominated warrants | |||||
Class of Stock [Line Items] | |||||
Warrants, measurement input | 0.0429 | 0.0388 | |||
Exercise price | Canadian dollar denominated warrants | |||||
Class of Stock [Line Items] | |||||
Warrants, measurement input | $ / shares | 12.28 | 10.80 | |||
Expected life | Canadian dollar denominated warrants | |||||
Class of Stock [Line Items] | |||||
Warrants, measurement input | Y | 1.6 | 1.7 |
EQUITY - Warrants liability (De
EQUITY - Warrants liability (Details) - Warrants - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended |
Mar. 31, 2024 | Jun. 30, 2023 | Dec. 31, 2023 | |
United States dollar denominated warrants | |||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Balance at the beginning | $ 94,185 | $ 1,859,374 | $ 1,859,374 |
Fair Value of US$ warrant liability as of June 30, 2023 | 1,287,400 | ||
Fair value of previously liability-classified US$ warrants reclassified to additional paid-in-capital as of July 1, 2023 | (1,287,400) | ||
Change in fair value of C$ warrant liability | (564,548) | ||
Foreign exchange loss | (7,426) | ||
Balance at the end | 94,185 | ||
Canadian dollar denominated warrants | |||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Fair value of previously equity-classified C$ warrants reclassified to warrant liability as of July 1, 2023 | $ 396,375 | ||
Change in fair value of C$ warrant liability | 14,133 | $ (302,190) | |
Balance at the end | $ 108,318 |
EQUITY - At-the-Market Offering
EQUITY - At-the-Market Offering ATM (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2024 | Dec. 31, 2023 | Sep. 30, 2023 | |
Class of Stock [Line Items] | |||
Common stock, capital shares reserved for future issuance | 18,416,279 | 16,133,820 | |
Proceeds from issuance of common share units, net of issuance costs | $ 190,274 | ||
ATM Offering | |||
Class of Stock [Line Items] | |||
Common stock, capital shares reserved for future issuance | 25 | ||
Issuance of Common Shares from ATM Offering, net of issuance costs (shares) | 75,862 | ||
Proceeds from issuance of common share units, net of issuance costs | $ 190,274 |
WARRANTS (Details)
WARRANTS (Details) | 1 Months Ended | 3 Months Ended | ||
Jan. 31, 2024 $ / shares shares | Mar. 31, 2024 $ / shares shares | Mar. 31, 2024 $ / shares shares | Dec. 31, 2023 shares | |
WARRANTS | ||||
Number of Warrants | 13,456,328 | 13,456,328 | 13,595,987 | |
Warrant exercises during period | 0 | |||
Exercise Price C$ 28.80 | ||||
WARRANTS | ||||
Exercise Price | $ / shares | $ 28.80 | |||
Warrants Expired | 139,659 | |||
Exercise Price C$ 18.00 | June 2024 | ||||
WARRANTS | ||||
Exercise Price | $ / shares | $ 18 | |||
Number of Warrants | 68,334 | 68,334 | ||
Exercise Price C$ 18.00 | November 2024 | ||||
WARRANTS | ||||
Exercise Price | $ / shares | $ 18 | |||
Number of Warrants | 150,818 | 150,818 | ||
Exercise Price C$ 18.00 | December 2024 | ||||
WARRANTS | ||||
Exercise Price | $ / shares | $ 18 | |||
Number of Warrants | 49,167 | 49,167 | ||
Exercise Price C$ 12.00 | November 2025 | ||||
WARRANTS | ||||
Exercise Price | $ / shares | $ 12 | |||
Number of Warrants | 279,613 | 279,613 | ||
Exercise Price USD 12.60 | August 2026 | ||||
WARRANTS | ||||
Exercise Price | $ / shares | $ 12.60 | |||
Number of Warrants | 524,088 | 524,088 | ||
Exercise Price USD 9.60 | August 2026 | ||||
WARRANTS | ||||
Exercise Price | $ / shares | $ 9.60 | |||
Number of Warrants | 146,744 | 146,744 | ||
Exercise Price USD 7.50 | April 2028 | ||||
WARRANTS | ||||
Exercise Price | $ / shares | $ 7.50 | |||
Number of Warrants | 345,938 | 345,938 | ||
Exercise Price USD 6.10 | April 2028 | ||||
WARRANTS | ||||
Exercise Price | $ / shares | $ 6.10 | |||
Number of Warrants | 69,188 | 69,188 | ||
Exercise Price USD 0.01 | ||||
WARRANTS | ||||
Exercise Price | $ / shares | $ 0.01 | |||
Number of Warrants | 594,724 | 594,724 | ||
Exercise Price USD 1.75 | February 2029 | ||||
WARRANTS | ||||
Exercise Price | $ / shares | $ 1.75 | |||
Number of Warrants | 11,227,714 | 11,227,714 |
SHARE-BASED COMPENSATION (Detai
SHARE-BASED COMPENSATION (Details) - shares | 1 Months Ended | 3 Months Ended | |
Jun. 30, 2015 | Mar. 31, 2024 | Dec. 31, 2023 | |
SHARE-BASED COMPENSATION | |||
Common Shares available for grant under stock option plan | 2,639,626 | 471,843 | |
Stock Option Plan 2007 | |||
SHARE-BASED COMPENSATION | |||
Options authorized as percentage of issued and outstanding common shares | 20% | ||
Expiration term | 10 years | ||
Common Shares available for grant under stock option plan | 2,639,626 | 471,843 |
SHARE-BASED COMPENSATION - Shar
SHARE-BASED COMPENSATION - Share options (Details) | 3 Months Ended | 12 Months Ended | |||
Mar. 31, 2024 CAD ($) $ / shares shares | Mar. 31, 2024 USD ($) $ / shares shares | Dec. 31, 2023 USD ($) $ / shares shares | Dec. 31, 2023 USD ($) $ / shares shares | Mar. 31, 2024 USD ($) $ / shares shares | |
Number of Share Options | |||||
Outstanding at the beginning | 898,262 | 898,262 | |||
Outstanding at the end | 1,152,597 | 1,152,597 | 898,262 | 898,262 | |
Weighted Average Exercise Price Per Share | |||||
Outstanding at the beginning (in dollars per share) | $ / shares | $ 7.58 | ||||
Expired (in dollars per share) | $ / shares | 18.30 | ||||
Outstanding at the end (in dollars per share) | $ / shares | 7.40 | $ 7.58 | |||
Vested and exercisable at the end (in dollars per share) | $ / shares | $ 7.29 | ||||
Weighted Average Remaining Contractual Term (years) and Aggregate Intrinsic Value | |||||
Fair value of options in a share based payment arrangement | $ | $ 442,002 | $ 442,002 | $ 716,969 | ||
Decrease in fair value | $ | $ 294,967 | ||||
CAD | |||||
Number of Share Options | |||||
Outstanding at the beginning | 898,262 | 898,262 | |||
Expired | (14,665) | (14,665) | |||
Granted | 0 | 0 | |||
Outstanding at the end | 883,597 | 883,597 | 898,262 | 898,262 | |
Vested and exercisable at the end | 793,570 | 793,570 | |||
Weighted Average Remaining Contractual Term (years) and Aggregate Intrinsic Value | |||||
Outstanding at the beginning (in years) | 6 years 4 months 24 days | 6 years 4 months 24 days | 6 years 6 months | 6 years 6 months | |
Outstanding at the end (in years) | 6 years 4 months 24 days | 6 years 4 months 24 days | 6 years 6 months | 6 years 6 months | |
Vested and exercisable at the end (in years) | 6 years 4 months 24 days | 6 years 4 months 24 days | |||
Outstanding at the end (in dollars) | $ | $ 27,581 | ||||
Vested and exercisable at the end (in dollars) | $ | $ 27,581 | ||||
Granted | 0 | 0 | |||
Number of options exercised | 0 | 0 | |||
USD | |||||
Number of Share Options | |||||
Outstanding at the beginning | 69,000 | 69,000 | |||
Granted | 200,000 | 200,000 | |||
Outstanding at the end | 269,000 | 269,000 | 69,000 | 69,000 | |
Vested and exercisable at the end | 58,333 | 58,333 | |||
Weighted Average Exercise Price Per Share | |||||
Outstanding at the beginning (in dollars per share) | $ / shares | $ 1.87 | ||||
Granted (in dollars per share) | $ / shares | 1.17 | ||||
Outstanding at the end (in dollars per share) | $ / shares | $ 1.35 | $ 1.87 | |||
Vested and exercisable at the end (in dollars per share) | $ / shares | $ 1.17 | ||||
Weighted Average Remaining Contractual Term (years) and Aggregate Intrinsic Value | |||||
Outstanding at the beginning (in years) | 9 years 8 months 12 days | 9 years 8 months 12 days | |||
Outstanding at the end (in years) | 9 years 8 months 12 days | 9 years 8 months 12 days | |||
Vested and exercisable at the end (in years) | 9 years 8 months 12 days | 9 years 8 months 12 days | |||
Granted | $ | $ 44,000 | ||||
Outstanding at the end (in dollars) | $ | $ 150,760 | ||||
Vested and exercisable at the end (in dollars) | $ | $ 43,166 | ||||
Granted | 200,000 | 200,000 | |||
Number of options exercised | 0 | 0 | |||
Grant date fair value of share options granted | $ | $ 182,820 |
SHARE-BASED COMPENSATION - Fair
SHARE-BASED COMPENSATION - Fair value of share options outstanding and exercisable (Details) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2024 $ / shares | Mar. 31, 2024 $ / shares | Dec. 31, 2023 $ / shares | |
SHARE-BASED COMPENSATION | |||
Weighted average fair value of Options | $ 0.90 | $ 0.53 | |
CAD | |||
SHARE-BASED COMPENSATION | |||
Expected volatility | 102.30% | 102.30% | 116.30% |
Risk-free interest rate | 4.39% | 4.39% | 4.04% |
Expected term (years) | 6 years 4 months 24 days | 6 years 4 months 24 days | 6 years 6 months |
USD | |||
SHARE-BASED COMPENSATION | |||
Weighted average fair value of Options | $ 0.91 | ||
Expected volatility | 98.60% | 98.60% | |
Risk-free interest rate | 3.90% | 3.90% | |
Expected term (years) | 5 years 9 months 18 days | 5 years 9 months 18 days |
SHARE-BASED COMPENSATION - Stat
SHARE-BASED COMPENSATION - Statements of operations and comprehensive loss (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
SHARE-BASED COMPENSATION | ||
Total share-based compensation | $ 63,584 | $ 132,510 |
CAD | ||
SHARE-BASED COMPENSATION | ||
Unrecognized share-based compensation related to options outstanding | $ 133,005 | |
Unrecognized share-based compensation related to options outstanding expected to be recognized over weighted-average remaining service period | 2 years | |
USD | ||
SHARE-BASED COMPENSATION | ||
Unrecognized share-based compensation related to options outstanding | $ 220,184 | |
Unrecognized share-based compensation related to options outstanding expected to be recognized over weighted-average remaining service period | 3 years 1 month 6 days | |
Research and development | ||
SHARE-BASED COMPENSATION | ||
Total share-based compensation | $ 3,812 | 38,909 |
General and administrative | ||
SHARE-BASED COMPENSATION | ||
Total share-based compensation | $ 59,772 | $ 93,601 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) | 3 Months Ended | |||
Mar. 31, 2024 USD ($) | Mar. 31, 2023 USD ($) | Jan. 31, 2022 CAD ($) | Apr. 30, 2016 CAD ($) | |
RELATED PARTY TRANSACTIONS | ||||
Cash payments | $ 149,160 | $ 147,828 | ||
Collaborative research agreement | ||||
RELATED PARTY TRANSACTIONS | ||||
Funding commitment | $ 5,030,000 | $ 787,500 | ||
Related party | ||||
RELATED PARTY TRANSACTIONS | ||||
Payments made for consulting services | $ 144,380 | $ 147,828 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) | 1 Months Ended | 3 Months Ended | |||
Apr. 30, 2016 | Mar. 31, 2024 CAD ($) | Mar. 31, 2023 CAD ($) | Mar. 31, 2024 USD ($) | Sep. 30, 2023 USD ($) | |
COMMITMENTS AND CONTINGENCIES | |||||
Accruals for royalty payments | $ 0 | ||||
Term of agreement | 3 years | ||||
UBC Agreement | |||||
COMMITMENTS AND CONTINGENCIES | |||||
Accruals for royalty payments | $ 0 | ||||
Payments of annual license | $ 25,000 | $ 25,000 |
NET LOSS PER SHARE (Details)
NET LOSS PER SHARE (Details) | Mar. 31, 2024 shares |
Pre Funded Warrants | |
NET LOSS PER SHARE | |
Warrants to purchase common shares | 594,724 |
NET LOSS PER SHARE - Computatio
NET LOSS PER SHARE - Computation of basic and diluted net loss per share (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Numerator: | ||
Net loss attributable to common shareholders | $ (3,635,088) | $ (4,959,431) |
Denominator: | ||
Weighted-average shares outstanding used in computing net loss per share attributable to common shareholders, basic | 19,533,976 | 8,579,284 |
Weighted-average shares outstanding used in computing net loss per share attributable to common shareholders, diluted | 19,533,976 | 8,579,284 |
Net loss per share attributable to common shareholders, basic | $ (0.19) | $ (0.58) |
Net loss per share attributable to common shareholders, diluted | $ (0.19) | $ (0.58) |
NET LOSS PER SHARE - Outstandin
NET LOSS PER SHARE - Outstanding potentially dilutive common shares (Details) - shares | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
NET LOSS PER SHARE | ||
Dilutive common shares equivalents excluded from computation of diluted net loss per share for periods presented because including them would have been antidilutive | 15,181,929 | 4,084,375 |
Employee Stock Option | ||
NET LOSS PER SHARE | ||
Dilutive common shares equivalents excluded from computation of diluted net loss per share for periods presented because including them would have been antidilutive | 1,152,597 | 1,043,025 |
Warrants | ||
NET LOSS PER SHARE | ||
Dilutive common shares equivalents excluded from computation of diluted net loss per share for periods presented because including them would have been antidilutive | 12,861,604 | 1,873,622 |
Series 1 Convertible Preferred Shares | ||
NET LOSS PER SHARE | ||
Dilutive common shares equivalents excluded from computation of diluted net loss per share for periods presented because including them would have been antidilutive | 1,166,667 | |
Series 2 Convertible Preferred Shares | ||
NET LOSS PER SHARE | ||
Dilutive common shares equivalents excluded from computation of diluted net loss per share for periods presented because including them would have been antidilutive | 1,166,667 | |
Deferred Share Units | ||
NET LOSS PER SHARE | ||
Dilutive common shares equivalents excluded from computation of diluted net loss per share for periods presented because including them would have been antidilutive | 1,061 | 1,061 |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Pay vs Performance Disclosure | ||
Net Income (Loss) | $ (3,635,088) | $ (4,959,431) |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Mar. 31, 2024 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |