Aytu BioPharma (AYTU) 10-Q 14 Nov 19 2020 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	3 Months Ended
	Sep. 30, 2019	Nov. 01, 2019
Document and Entity Information [Abstract]
Entity Registrant Name	AYTU BIOSCIENCE, INC
Entity Central Index Key	0001385818
Amendment Flag	false
Current Fiscal Year End Date	--06-30
Document Type	10-Q
Document Period End Date	Sep. 30, 2019
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q1
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		20,733,052

Consolidated Balance Sheets

Consolidated Balance Sheets - USD ($)	Sep. 30, 2019	Jun. 30, 2019
Current assets
Cash and cash equivalents	$ 7,014,307	$ 11,044,227
Restricted cash	250,000	250,000
Accounts receivable, net	1,705,428	1,740,787
Inventory, net	1,380,729	1,440,069
Prepaid expenses and other	573,199	957,781
Note receivable	1,000,000	0
Other current assets	59,014	0
Total current assets	11,982,677	15,432,864
Fixed assets, net	137,900	203,733
Licensed assets, net	18,293,199	18,861,983
Patents, net	214,278	220,611
Right-of-use-asset	393,820	0
Deposits	2,200	2,200
Total long-term assets	19,041,397	19,288,527
Total assets	31,024,074	34,721,391
Current liabilities
Accounts payable and other	2,632,642	2,297,270
Accrued liabilities	1,151,181	1,147,740
Accrued compensation	1,002,409	849,498
Current lease liability	79,362	0
Current contingent consideration	1,236,625	1,078,068
Total current liabilities	6,102,219	5,372,576
Long-term contingent consideration	22,272,068	22,247,796
Long-term lease liability	314,457	0
Warrant derivative liability	11,371	13,201
Total liabilities	28,700,115	27,633,573
Stockholders' equity
Preferred Stock, par value $.0001; 50,000,000 shares authorized; shares issued and outstanding 3,151,148 and 3,594,981, respectively as of September 30, 2019 and June 30, 2019	315	359
Common Stock, par value $.0001; 100,000,000 shares authorized; shares issued and outstanding 17,981,094 and 17,538,071, respectively as of September 30, 2019 and June 30, 2019	1,798	1,754
Additional paid-in capital	113,640,376	113,475,205
Accumulated deficit	(111,318,530)	(106,389,500)
Total stockholders' equity	2,323,959	7,087,818
Total liabilities and stockholders' equity	$ 31,024,074	$ 34,721,391

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) - $ / shares	Sep. 30, 2019	Jun. 30, 2019
Statement of Financial Position [Abstract]
Preferred stock, par value	$ .0001	$ .0001
Preferred stock, shares authorized	50,000,000	50,000,000
Preferred stock, shares issued	3,151,148	3,594,981
Preferred stock, shares outstanding	3,151,148	3,594,981
Common stock, par value	$ .0001	$ .0001
Common stock, shares authorized	100,000,000	100,000,000
Common stock, shares issued	17,981,094	17,538,071
Common stock, shares outstanding	17,981,094	17,538,071

Consolidated Statements of Oper

Consolidated Statements of Operations (Unaudited) - USD ($)	3 Months Ended
	Sep. 30, 2019	Sep. 30, 2018
Revenues
Product revenue, net	$ 1,439,826	$ 1,431,809
Total product revenue	1,439,826	1,431,809
Operating expenses
Cost of sales	375,720	410,959
Research and development	78,020	155,878
Selling, general and administrative	5,146,443	3,576,580
Selling, general and administrative - related party (Note 15)	0	253,709
Amortization of intangible assets	575,117	451,957
Total operating expenses	6,175,300	4,849,083
Loss from operations	(4,735,474)	(3,417,274)
Other (expense) income
Other (expense), net	(195,386)	(76,561)
Gain from warrant derivative liability	1,830	47,352
Total other (expense) income	(193,556)	(29,209)
Net loss	$ (4,929,030)	$ (3,446,483)
Weighted average number of common shares outstanding	15,325,921	1,759,824
Basic and diluted net loss per common share	$ (.32)	$ (1.96)

Consolidated Statement of Stock

Consolidated Statement of Stockholders' Equity (Unaudited) - USD ($)	Preferred Stock [Member]	Common Stock [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	Total
Beginning balance, shares at Jun. 30, 2018	0	1,794,762
Beginning balance, amount at Jun. 30, 2018	$ 0	$ 179	$ 92,681,918	$ (79,257,592)	$ 13,424,505
Stock-based compensation			152,114		152,114
Adjustment for rounding of shares due to stock split, shares		6,649
Adjustment for rounding of shares due to stock split, amount		$ 1	(1)		0
Net loss				(3,446,483)	(3,446,483)
Ending balance, shares at Sep. 30, 2018	0	1,801,411
Ending balance, amount at Sep. 30, 2018	$ 0	$ 180	92,834,031	(82,704,075)	10,130,136
Beginning balance, shares at Jun. 30, 2019	3,594,981	17,538,071
Beginning balance, amount at Jun. 30, 2019	$ 359	$ 1,754	113,475,205	(106,389,500)	7,087,818
Stock-based compensation			165,171		165,171
Preferred stocks converted into common stock, shares	(443,833)	443,833
Preferred stocks converted into common stock, amount	$ (44)	$ 44			0
Net loss				(4,929,030)	(4,929,030)
Ending balance, shares at Sep. 30, 2019	3,151,148	17,981,904
Ending balance, amount at Sep. 30, 2019	$ 315	$ 1,798	$ 113,640,376	$ (111,318,530)	$ 2,323,959

Consolidated Statements of Cash

Consolidated Statements of Cash Flows (Unaudited) - USD ($)	3 Months Ended
	Sep. 30, 2019	Sep. 30, 2018
Cash flows from operating activities
Net loss	$ (4,929,030)	$ (3,446,483)
Adjustments to reconcile net loss to cash used in operating activities
Depreciation, amortization and accretion	869,312	556,807
Stock-based compensation expense	165,171	152,114
Derivative income	(1,830)	(47,352)
Changes in operating assets and liabilities:
Decrease (increase) in accounts receivable	35,359	(181,274)
Decrease in inventory	59,340	28,870
Decrease (increase) in prepaid expenses and other	384,582	(296,971)
Decrease (increase) in accounts payable and other	276,917	(7,889)
Increase in accrued liabilities	3,441	242,969
Increase in accrued compensation	152,911	256,174
(Decrease) in deferred rent	(3,990)	(1,450)
Net cash used in operating activities	(2,987,817)	(2,744,485)
Cash flows used in investing activities
Deposits	0	2,888
Purchases of fixed assets	0	(6,065)
Contingent consideration payment	(42,103)	0
Notes receivable	(1,000,000)	0
Purchase of assets	0	(300,000)
Net cash used in investing activities	(1,042,103)	(303,177)
Cash flows from financing activities
Net cash provided by financing activities	0	0
Net change in cash, cash equivalents and restricted cash	(4,029,920)	(3,047,662)
Cash, cash equivalents and restricted cash at beginning of period	11,294,227	7,112,527
Cash, cash equivalents and restricted cash at end of period	7,264,307	4,064,865
Supplemental disclosures of cash and non-cash investing and financing transactions
Cash paid for interest	3,390	0
Fair value of right-to-use asset and related lease liability upon adoption of Topic 842 - Leases	412,691	0
Contingent consideration included in accounts payable	3,430	0
Acquisition costs included in accounts payable	$ 59,014	$ 0
Exchange of convertible preferred stock into common stock	44	0

Nature of Business, Financial C

Nature of Business, Financial Condition, Basis of Presentation	3 Months Ended
	Sep. 30, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Nature of Business, Financial Condition, Basis of Presentation	Nature of Business. The Company is currently focused on commercialization of four products, (i) Natesto®, a testosterone replacement therapy, or TRT, (ii) Tuzistra® XR, a codeine–based antitussive, (iii) ZolpiMist™, a short-term insomnia treatment and (iv), MiOXSYS®, a novel in vitro diagnostic system for male infertility assessment. In the future the Company will look to acquire additional commercial-stage or near-market products, including existing products we believe can offer distinct clinical advantages and patient benefits over existing marketed products. The management team’s prior experience has involved identifying both clinical-stage and commercial-stage assets that can be launched or re-launched to increase value, with a focused commercial infrastructure specializing in novel, niche products. Financial Condition. On October 11, 2019, the Company entered into Securities Purchase Agreements (the “Purchase Agreement”) with two institutional investors (the “Investors”) providing for the issuance and sale by the Company (the “Offering”) of $10.0 million of, (i) shares of the Company’s Series F Convertible Preferred Stock (the “Preferred Stock”) which are convertible into shares of common stock (the “Conversion Shares”) and (ii) warrants (the “Warrants”) which are exercisable for shares of common stock (the “Warrant Shares”). The Warrants have an exercise price equal to $1.25 and contain cashless exercise provisions. Each Warrant will be exercisable after we obtain stockholder approval as required by applicable Nasdaq rules (“Shareholder Approval”) and will expire five years from the time a registration statement covering the Conversion Shares and Warrant Shares is declared effective by the Securities and Exchange Commission. The closing of the sale of these securities occurred on October 16, 2019. The net proceeds that the Company received from the Offering were approximately $9.3 million. The net proceeds received by the Company from the Offering will be used for general corporate purposes, including working capital. As of the date of this Report, the Company expects its commercial costs for its current operation to remain approximately flat or to increase modestly as the Company continues to focus on revenue growth through increasing product sales. The Company’s current asset position of $31.0 million plus the proceeds expected from ongoing product sales will be used to fund operations. The Company will access the capital markets to fund operations if and when needed, and to the extent it is required. The timing and amount of capital that may be raised is dependent on market conditions and the terms and conditions upon which investors would require to provide such capital. There is no guarantee that capital will be available on terms favorable to the Company and its stockholders, or at all. However, the Company has been successful in accessing the capital markets in the past and is confident in its ability to access the capital markets again, if needed. Since the Company does not have sufficient cash and cash equivalents on-hand as of September 30, 2019 to cover potential net cash outflows for the twelve months following the filing date of this Quarterly Report, ASU 2014-15, Presentation of Financial Statements—Going Concern (Subtopic 205-40) requires the Company to report that there exists an indication of substantial doubt about its ability to continue as a going concern. If the Company is unable to raise adequate capital in the future when it is required, the Company can adjust its operating plans to reduce the magnitude of the capital need under its existing operating plan. Some of the adjustments that could be made include delays of and reductions to commercial programs, reductions in headcount, narrowing the scope of the Company’s commercial plans, or reductions to its research and development programs. Without sufficient operating capital, the Company could be required to relinquish rights to products or renegotiate to maintain such rights on less favorable terms than it would otherwise choose. This may lead to impairment or other charges, which could materially affect the Company’s balance sheet and operating results. Recent acquisition agreements. The Merger Agreement, agreed to on September 12, 2019, by both the Company and Innovus will cause, upon closing of the merger, for the Company to retire all of the outstanding common stock of Innovus for an aggregate of up to $8 million in shares of the Company’s common stock, less certain deductions (includes approximately $1.4 million in cash borrowed by Innovus from the Company during this time period (see Note 10)). This initial consideration to Innovus common shareholders is estimated to consist of primarily 4.2 million shares of the Company’s stock, and up to 1.5 million shares of the Company’s stock to satisfy certain warrant holders’ obligation. Additional consideration for up to $16 million in milestone payments in the form of contingent value rights (CVRs) may be paid to Innovus shareholders in cash or stock over the next five years if certain revenue and profitability milestones are achieved. Innovus specializes in commercializing, licensing and developing safe and effective over-the-counter consumer health products. The Company does not anticipate that this transaction will formally close until the quarter ended March 31, 2020 and is subject to approval by the shareholders of both the Company and Innovus. The Asset Purchase Agreement agreed to on October 10, 2019, between the Company and Cerecor, caused upon the November 1, 2019 closing, the Company to pay $4.5 million in cash, issue approximately 9.8 million shares of Series G Convertible Preferred Stock and assume certain of Seller’s financial and royalty obligations, which includes approximately $16.6 million of fixed payment obligations to a third-party creditor and not more than $3.5 million of Medicaid rebates and products returns. The Commercial Portfolio consists of six pharmaceutical and other prescription products competing in markets exceeding $8 billion in annual sales in the United States. In addition, the Company will be assuming the majority of the Cerecor’s commercial sales, commercial contracts and customer relationship workforce. In addition, the Company has assumed obligations due to an investor including fixed and variable payments. The Company assumed fixed monthly payments equal to $0.1 million from November 2019 through January 2021 plus $15 million due in January 2021. Monthly variable payments due to the same investor are equal to 15% of net revenue generated from a subset of the Product Portfolio, subject to an aggregate monthly minimum of $0.1 million, except for January 2020, when a one-time payment of $0.2 million is due. The variable payment obligation continues until aggregate variable payments of approximately $9.5 million have been made. Further, certain of the products in the Product Portfolio require royalty payments ranging from 15% to 23.5% of net revenue. One of the products in the Product Portfolio requires the Company to generate minimum annual sales sufficient to represent annual royalties of $1.8 million. Nasdaq Listing Compliance. , Basis of Presentation. Adoption of New Accounting Pronouncements Leases (“ASU 2016-02”). Topic 842 Leases. The Company has elected to apply the short-term scope exception for leases with terms of 12 months or less at the inception of the lease and will continue to recognize rent expense on a straight-line basis. As a result of the adoption, on July 1, 2019, the Company recognized a lease liability of approximately $0.4 million, which represented the present value of the remaining minimum lease payments using an estimated incremental borrowing rate of 8%. As of September 30, 2019, the Company recognized a right-to-use asset of approximately $0.4 million. Lease expense did not change materially as a result of the adoption of ASU 2016-02. Recently Accounting Pronouncements Fair Value Measurements (“ASU 2018-03”). The amendments on changes in unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements, and the narrative description of measurement uncertainty should be applied prospectively for only the most recent interim or annual period presented in the initial fiscal year of adoption. All other amendments should be applied retrospectively to all periods presented upon their effective date. Early adoption is permitted upon issuance of ASU 2018-13. An entity is permitted to early adopt any removed or modified disclosures upon issuance of ASU 2018-13 and delay adoption of the additional disclosures until their effective date. The Company is currently assessing the impact that ASU 2018-13 will have on its financial statements. Financial Instruments – Credit Losses (“ASU 2016-13”). This Quarterly Report on Form 10-Q does not discuss recent pronouncements that are not anticipated to have an impact on or are unrelated to its financial condition, results of operations, cash flows or disclosures.

Revenue Recognition

Revenue Recognition	3 Months Ended
	Sep. 30, 2019
Revenue from Contract with Customer [Abstract]
Revenue Recognition	The Company sells its products principally to a limited number of wholesale distributors and pharmacies in the United States, which account for the largest portion of our total revenue. International sales are made primarily to specialty distributors, as well as hospitals, laboratories, and clinics, some of which are government owned or supported (collectively, its “Customers”). The Company’s Customers in the United States subsequently resell the products to pharmacies and patients. Revenue from product sales is recorded at the net sales price, or “transaction price,” which includes estimates of variable consideration that result from coupons, discounts, chargebacks and distributor fees, processing fees, as well as allowances for returns and government rebates. In accordance with ASC 606, the Company recognizes net revenues from product sales when the Customer obtains control of the Company’s product, which typically occurs upon delivery to the Customer. The Company’s payment terms are between 30 to 60 days in the United States and consistent with prevailing practice in international markets. Revenues by Geographic location. Revenues by Geographic location The following table reflects our product revenues by geographic location as determined by the billing address of our customers: Three Months Ended September 30, 2019 2018 U.S. $ 1,262,000 $ 1,273,000 International 178,000 159,000 Total net revenue $ 1,440,000 $ 1,432,000

Product Licenses

Product Licenses	3 Months Ended
	Sep. 30, 2019
Product Licenses
Product Licenses	The Company currently licenses three of its existing product offerings from third parties: (i) Natesto; (ii) ZolpiMist, and (ii) Tuzistra XR. Each of these license agreements are subject to terms and conditions specific to each agreement. The Company capitalized the acquisition cost of each license, which included a combination of both upfront considerations, as well as the estimated future contingent consideration estimated at the acquisition date. Future adjustments to contingent consideration for the existing products will be recognized as an unrealized gain/loss due to the changes in the fair value of the contingent consideration. License and Supply Agreement—Natesto In April 2016, The Company entered into a license and supply agreement to acquire the exclusive U.S. rights to commercialize Natesto® (testosterone) nasal gel from Acerus Pharmaceuticals Corporation, or Acerus. The Company acquired the rights effective upon the expiration of the former licensee’s rights, which occurred on June 30, 2016. The term of the license runs for the greater of eight years or until the expiry of the latest to expire patent, including claims covering Natesto or until the entry on the market of at least one AB-rated generic product. In addition to the previously disclosed upfront payments made to Acerus, The Company agreed to make one-time, non-refundable milestone payments to Acerus within 45 days of the occurrence of certain agreed upon milestones. The maximum aggregate amount payable under such milestone payments is $37.5 million. The fair value of the net identifiable Natesto asset acquired was determined to be $10.5 million, which is being amortized over eight years. The aggregate amortization expense for each of the three-month periods ended September 30, 2019 and 2018 was $0.3 million. The contingent consideration was initially valued at $3.2 million using a Monte Carlo simulation, as of June 30, 2016. As of June 30, 2019, the contingent consideration was revalued at $5.1 million using the same Monte Carlo simulation methodology, and based on current interest rates, expected sales potential, and Aytu stock trading variables. The Company reevaluates the contingent consideration on a quarterly basis for changes in the fair value recognized after the acquisition date, such as measurement period adjustments. The contingent consideration accretion expense for each of the three-month periods ended September 30, 2019 and 2018 was $79,000, and $15,000, respectively. License Agreement—ZolpiMist In June 2018, The Company signed an exclusive license agreement for ZolpiMist™ (zolpidem tartrate oral spray) from Magna Pharmaceuticals, Inc., (“Magna”). This agreement allows for The Company’s exclusive commercialization of ZolpiMist in the U.S. and Canada. The Company made an upfront payment of $0.4 million to Magna upon execution of the agreement. In July 2018, the Company paid an additional $0.3 million, of which, $0.3 million was included in current contingent consideration at June 30, 2018.. The ZolpiMist license agreement was valued at $3.2 million and will be amortized over the life of the license agreement up to seven years. The amortization expense for each of the three months ended September 30, 2019 and 2018 was $0.1 million. The Company also agreed to make certain royalty payments to Magna which will be calculated as a percentage of ZolpiMist net sales and are payable within 45 days of the end of the quarter during which the applicable net sales occur. The contingent consideration related to these royalty payments was valued at $2.6 million using a Monte Carlo simulation, as of June 11, 2018. As of June 30, 2019, the contingent consideration was revalued at $2.3 million using the same Monte Carlo simulation methodology, and based on current interest rates, expected sales potential, and The Company’s stock trading variables. The Company reevaluates the contingent consideration on a quarterly basis for changes in the fair value recognized after the acquisition date, such as measurement period adjustments. The contingent consideration accretion expense for the three months ended September 30, 2019 and 2018 was $0.1 million and $0.1 million, respectively. License, Development, Manufacturing and Supply Agreement—Tuzistra XR On November 2, 2018, the Company entered into a License, Development, Manufacturing and Supply Agreement (the “Tris License Agreement”) with TRIS Pharma, Inc. (“TRIS”). Pursuant to the Tris License Agreement, TRIS granted the Company an exclusive license in the United States to commercialize Tuzistra XR. In addition, TRIS granted the Company an exclusive license in the United States to commercialize a complementary antitussive referred to as “CCP-08” (together with Tuzistra XR, the “Products”) for which marketing approval has been sought by TRIS under a New Drug Application filed with the Food and Drug Administration (“FDA”). As consideration for the Products license, the Company: (i) made an upfront cash payment to TRIS; (ii) issued shares of Series D Convertible preferred stock to TRIS; and (iii) will pay certain royalties to TRIS throughout the license term in accordance with the Tris License Agreement. The Tris License Agreement was valued at $9.9 million and will be amortized over the life of the Tris License Agreement up to twenty years. The amortization expense for each of the three-month periods ended September 30, 2019 and 2018 was $123,000 and $0, respectively. The Company also agreed to make certain quarterly royalty payments to TRIS which will be calculated as a percentage of our Tuzistra XR net sales, payable within 45 days of the end of the applicable quarter. As of November 2, 2018, the contingent consideration, related to this asset, was valued at $8.8 million using a Monte Carlo simulation. As of June 30, 2019, the contingent consideration was revalued at $16.0 million using the same Monte Carlo simulation methodology, and based on current interest rates, expected sales potential, and The Company’s stock trading variables. The Company reevaluates the contingent consideration on a quarterly basis for changes in the fair value recognized after the acquisition date, such as measurement period adjustments. The contingent consideration accretion expense for the three months ended March 31, 2019 and 2018 was $96,000, and $0, respectively.

Inventories

Inventories	3 Months Ended
	Sep. 30, 2019
Inventory Disclosure [Abstract]
Inventories	Inventories consist of raw materials, work in process and finished goods and are recorded at the lower of cost or net realizable value, with cost determined on a first-in, first-out basis. The Company periodically reviews the composition of its inventories to identify obsolete, slow-moving or otherwise unsaleable items. If unsaleable items are observed and there are no alternate uses for the inventory, The Company will record a write-down to net realizable value in the period that the impairment is first recognized. There was no inventory write-down during the three months ended September 30, 2019 or September 30, 2018, respectively. Inventory balances consist of the following: As of As of September 30, June 30, 2019 2019 Raw materials $ 154,000 $ 117,000 Finished goods 1,227,000 1,323,000 $ 1,381,000 $ 1,440,000

Fixed Assets

Fixed Assets	3 Months Ended
	Sep. 30, 2019
Property, Plant and Equipment [Abstract]
Fixed Assets	Fixed assets are recorded at cost and, once placed in service, are depreciated on a straight-line basis over the estimated useful lives. Leasehold improvements are amortized over the shorter of the estimated economic life or related lease term. Fixed assets consist of the following: As of As of Estimated September 30, June 30, Useful Lives in years 2019 2019 Manufacturing equipment 2 - 5 $ 83,000 $ 83,000 Leasehold improvements 3 112,000 112,000 Office equipment, furniture and other 2 - 5 265,000 315,000 Lab equipment 3 - 5 90,000 90,000 Less accumulated depreciation and amortization (412,000 ) (396,000 ) Fixed assets, net $ 138,000 $ 204,000 The depreciation and amortization expense was $16 thousand and $28 thousand for the three-months ended September 30, 2019 and 2018, respectively.

Leases, Right-to-Use Assets and

Leases, Right-to-Use Assets and Related Liabilities	3 Months Ended
	Sep. 30, 2019
Leases Right-to-use Assets And Related Liabilities
Leases, Right-to-Use Assets and Related Liabilities	In September 2015, the Company entered into a 37-month operating lease in Englewood, Colorado. This lease had an initial base rent of $9,000 a month with a total base rent over the term of the lease of approximately $318,000. In October 2017, the Company signed an amendment to the 37-month operating lease in Englewood, Colorado, extending the lease for an additional 24 months beginning October 1, 2018. The base rent remained $9,000 per month. In April 2019, the Company extended the lease for an additional 36 months beginning October1, 2020. In June 2018, the Company entered into a 12-month operating lease, beginning on August 1, 2018, for office space in Raleigh, North Carolina. This lease has base rent of $1,100 a month, with total rent over the term of the lease of approximately $13,200. As discussed within Note 1 “Leases (Topic 842)” Total 2020 2021 2022 2023 2024 Thereafter Remaining Office leases 463,000 81,000 113,000 118,000 121,000 30,000 - Less: Discount Adjustment (69,000 ) Total lease liability 394,000 Lease liability - current portion 79,000 Long-term lease liability 315,000 Prior to the adoption of ASU 2016-02, the Company recognized deferred rent when the straight-line rent expense exceeded the actual lease payments and reduced deferred rent when the actual lease payments exceeded the straight-line rent expense. Deferred rent was also classified between current and long-term on the balance sheet. Rent expense for the respective periods totaled $32 thousand for the three months ended September 30, 2019 and 2018, respectively Three Months Ended September 30, 2019 2018 Rent expense $ 32,000 $ 32,000

Patents

Patents	3 Months Ended
	Sep. 30, 2019
Goodwill and Intangible Assets Disclosure [Abstract]
Patents	The cost of the oxidation-reduction potential (“ORP”) technology related patents for the MiOXSYS Systems was $380,000 when they were acquired and are being amortized over the remaining U.S. patent life of approximately 15 years as of the date, which expires in March 2028. Patents consist of the following: As of As of September 30, June 30, 2019 2019 Patents $ 380,000 $ 380,000 Less accumulated amortization (166,000 ) (159,000 ) Patents, net $ 214,000 $ 221,000 The amortization expense was $7 thousand for the three-months ended September 30, 2019 and 2018, respectively.

Accrued Liabilities

Accrued Liabilities	3 Months Ended
	Sep. 30, 2019
Accrued Liabilities
Accrued liabilities	Accrued liabilities consist of the following: As of As of September 30, June 30, 2019 2019 Accrued accounting fee $ 42,000 $ 85,000 Accrued program liabilities 843,000 736,000 Accrued product-related fees 133,000 295,000 Customer overpayment 79,000 − Other accrued liabilities* 54,000 32,000 Total accrued liabilities $ 1,151,000 $ 1,148,000 * Other accrued liabilities consist of franchise tax, samples and consultants, none of which individually represent greater than five percent of total current liabilities.

Fair Value Considerations

Fair Value Considerations	3 Months Ended
	Sep. 30, 2019
Fair Value Disclosures [Abstract]
Fair Value Considerations	The Company’s financial instruments include cash and cash equivalents, restricted cash, accounts receivable, accounts payable, accrued liabilities, warrant derivative liability, and contingent consideration. The carrying amounts of financial instruments, including cash and cash equivalents, restricted cash, accounts receivable, accounts payable, and accrued liabilities approximate their fair value due to their short maturities. The fair value of the warrant derivative liability was valued using the lattice valuation methodology. The fair value of acquisition-related contingent consideration is based on a Monte-Carlo methodology using estimated discounted future cash flows and periodic assessments of the probability of occurrence of potential future events. The valuation policies are determined by management, and the Company’s Board of Directors is informed of any policy change. Authoritative guidance defines fair value as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the measurement date. The guidance establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions of what market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The hierarchy is broken down into three levels based on reliability of the inputs as follows: Level 1: Inputs that reflect unadjusted quoted prices in active markets that are accessible to Aytu for identical assets or liabilities; Level 2: Inputs that include quoted prices for similar assets and liabilities in active or inactive markets or that are observable for the asset or liability either directly or indirectly; and Level 3: Unobservable inputs that are supported by little or no market activity. The Company’s assets and liabilities which are measured at fair value are classified in their entirety based on the lowest level of input that is significant to their fair value measurement. The Company’s policy is to recognize transfers in and/or out of fair value hierarchy as of the date in which the event or change in circumstances caused the transfer. Aytu has consistently applied the valuation techniques discussed below in all periods presented. The following table presents the Company’s financial liabilities that were accounted for at fair value on a recurring basis as of September 30, 2019 and June 30, 2019, by level within the fair value hierarchy. Fair Value Measurements at September 30, 2019 Fair Value at September 30, 2019 Quoted Priced in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs(Level 2) Significant Unobservable Inputs(Level 3) Recurring: Warrant derivative liability 11,000 $ - $ - $ 11,000 Contingent consideration 23,509,000 $ - $ - $ 23,509,000 23,520,000 - - 23,520,000 Fair Value Measurements at June 30, 2019 Fair Value at June 30, 2019 Quoted Priced in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs(Level 2) Significant Unobservable Inputs(Level 3) Recurring: Warrant derivative liability 13,000 $ - $ - $ 13,000 Contingent consideration 23,326,000 $ - $ - $ 23,326,000 23,339,000 - - 23,339,000 The warrant derivative liability was valued using the lattice valuation methodology because that model embodies the relevant assumptions that address the features underlying these instruments. The warrants related to the warrant derivative liability are not actively traded and are, therefore, classified as Level 3 liabilities. Significant assumptions in valuing the warrant derivative liability, based on estimates of the value of the Company’s common stock and various factors regarding the warrants, were as follows as of issuance and as of September 30, 2019: As of September 30, 2019 As of June 30, 2019 At Issuance Warrant Derivative Liability Volatility 163.2 % 163.2 % 188.0 % Equivalent term (years) 2.88 3.13 5.00 Risk-free interest rate 1.71 % 1.71 % 1.83 % Dividend yield 0.00 % 0.00 % 0.00 % The following table sets forth a reconciliation of changes in the fair value of the derivative financial liabilities classified as Level 3 in the fair value hierarchy: Liability Classified Warrants Balance as of June 30, 2019 $ 13,000 Change in fair value included in earnings (2,000 ) Balance as of September 30, 2019 $ 11,000 The Company classifies its contingent consideration liability in connection with the acquisition of Natesto, Tuzistra XR and ZolpiMist within Level 3 as factors used to develop the estimated fair value are unobservable inputs that are not supported by market activity. The Company estimates the fair value of our contingent consideration liability based on projected payment dates, discount rates, probabilities of payment, and projected revenues. Projected contingent payment amounts are discounted back to the current period using a discounted cash flow methodology. The following table sets forth a summary of changes in the contingent consideration for the period ended September 30, 2019: Contingent Consideration Balance as of June 30, 2019 $ 23,326,000 Increase due to accretion 229,000 Decrease due to contractual payment (46,000 ) Balance as of September 30, 2019 $ 23,509,000

Note Receivable

Note Receivable	3 Months Ended
	Sep. 30, 2019
Note Receivable
Note receivable	On September 12, 2019, the Company announced it had entered into a definitive merger agreement with Innovus (see Note 1) to acquire Innovus which specializes in commercializing, licensing and developing safe and effective over-the-counter consumer health products. As part of the negotiations with Innovus, the Company agreed to provide short-term, loan in the form of a $1.0 promissory note on August 8, 2019 (the “Innovus Note”). The Innovus Note will be used to offset a portion of the purchase price upon closing of the Innovus Merger Agreement (see Note 1) or, in the event the Merger Agreement does not close, is due on February 29, 2020, accruing interest at 10.0% per annum to be paid upon principal paydown. In the event of default, the interest rate increases to 15.0% per annum. In addition, on October 11, 2019, the Company amended the original promissory note, providing an additional approximately $0.4 million of bridge financing under the same terms and conditions as the Innovus Note.

Commitments and Contingencies

Commitments and Contingencies	3 Months Ended
	Sep. 30, 2019
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Commitments and contingencies are described below and summarized by the following as of September 30, 2019: Total 2020 2021 2022 2023 2024 Thereafter Prescription database $ 1,469,000 $ 423,000 $ 534,000 $ 512,000 $ - $ - $ - Product milestone payments 5,500,000 - - - 5,500,000 - - $ 6,969,000 $ 423,000 $ 534,000 $ 512,000 $ 5,500,000 $ - $ - Prescription Database In May 2016, the Company entered into an agreement with a vendor that will provide it with prescription database information. The Company agreed to pay approximately $1.6 million over three years for access to the database of prescriptions written for Natesto. The payments have been broken down into quarterly payments. Milestone Payments In connection with the Company’s intangible assets, Aytu has certain milestone payments, totaling $5.5 million, payable at a future date, are not directly tied to future sales, but upon other events certain to happen. These obligations are included in the valuation of the Company’s contingent consideration (see Note 9).

Capital Structure

Capital Structure	3 Months Ended
	Sep. 30, 2019
Equity [Abstract]
Capital structure	At September 30, 2019 and June 30, 2018, Aytu had 17,981,904 and 17,538,071 common shares outstanding, respectively, and 3,151,148 and 3,594,981 preferred shares outstanding, respectively. The Company has 100 million shares of common stock authorized with a par value of $0.0001 per share and 50 million shares of preferred stock authorized with a par value of $0.0001 per share. The Company has 50 million shares of non-voting, non-cumulative preferred stock authorized with a par value of $0.0001 per share, of which, 400,000 are designated as Series D Convertible preferred stock, and 2,751,148 are designated as Series E Convertible preferred stock as of September 30, 2019. Liquidation rights for all series of preferred stock are on an as-converted basis. Included in the common stock outstanding are 2,342,604 shares of restricted stock issued to executives, directors, employees and consultants. During the quarter ended September 30, 2019, investors holding shares of Series C preferred stock exercised their right to convert 443,833 shares of Series C preferred stock into 443,833 shares of common stock. As of September 30, 2019, there are no remaining Series C preferred stock outstanding. In October 2019, Armistice Capital converted 2,751,148 shares of Series E Preferred Stock into 2,751,148 shares of common stock.

Equity Incentive Plan

Equity Incentive Plan	3 Months Ended
	Sep. 30, 2019
Share-based Payment Arrangement [Abstract]
Equity Incentive Plan	Share-based Compensation Plans On June 1, 2015, Aytu’s stockholders approved the Aytu BioScience 2015 Stock Option and Incentive Plan (the “2015 Plan”), which, as amended in July 2017, provides for the award of stock options, stock appreciation rights, restricted stock and other equity awards for up to an aggregate of 3.0 million shares of common stock. The shares of common stock underlying any awards that are forfeited, canceled, reacquired by Aytu prior to vesting, satisfied without any issuance of stock, expire or are otherwise terminated (other than by exercise) under the 2015 Plan will be added back to the shares of common stock available for issuance under the 2015 Plan. As of September 30, 2019, we have 657,380 shares that are available for grant under the 2015 Plan. Stock Options Employee Stock Options: Stock option activity is as follows: Number of Options Weighted Average Exercise Price Weighted Average Remaining Contractual Life in Years Outstanding June 30, 2019 1,607 $ 325.73 6.13 Expired (51 ) 328.00 Outstanding September 30, 2019 1,556 325.66 6.08 Exercisable at September 30, 2019 1,544 $ 325.64 6.08 As of September 30, 2019, there was $2,000 of total unrecognized option-based compensation expense related to non-vested stock options. The Company expects to recognize this expense over a weighted-average period of 0.12 years. Restricted Stock Restricted stock activity is as follows: Number of Shares Weighted Average Grant Date Fair Value Weighted Average Remaining Contractual Life in Years Unvested at June 30, 2019 2,436,214 $ 1.83 9.1 Granted – – Vested – – Forfeited (5,150 ) $ 2.44 Unvested at September 30, 2019 2,431,064 $ 1.83 7.2 During the quarter ended September 30, 2019, 5,150 shares of restricted stock were exchanged with common stock, and the Company recognized an increase in aggregate stock compensation expense of $2,600. Under the 2015 Plan, there was $3,755,000 of total unrecognized stock-based compensation expense related to the non-vested restricted stock as of September 30, 2019. The Company expects to recognize this expense over a weighted-average period of 8.82 years. The Company previously issued 1,540 shares of restricted stock outside the Company’s 2015 Plan, which vest in July 2026. The unrecognized expense related to these shares was $1,347,000 as of September 30, 2019 and is expected to be recognized over the weighted average period of 6.78 years. Stock-based compensation expense related to the fair value of stock options and restricted stock was included in the statements of operations as selling, general and administrative expenses as set forth in the table below: Three Months Ended September 30, Selling, general and administrative: 2019 2018 Stock options $ 5,000 $ 66,000 Restricted stock 160,000 86,000 Total stock-based compensation expense $ 165,000 $ 152,000

Warrants

Warrants	3 Months Ended
	Sep. 30, 2019
Warrants
Warrants	The Company has issued equity-based warrants and liability warrants in conjunction with equity raises. There were no warrants issued during the three-months ended September 30, 2019 and the three-months ended September 30, 2018. . A summary of equity-based warrants is as follows: Number of Warrants Weighted Average Exercise Price Weighted Average Remaining Contractual Life in Years Outstanding June 30, 2019 16,218,908 $ 3.15 4.36 Warrants expired - $ - Warrants exercised - $ - Outstanding September 30, 2019 16,218,908 $ 3.15 4.11 A summary of liability warrants is as follows: Number of Warrants Weighted Average Exercise Price Weighted Average Remaining Contractual Life in Years Outstanding June 30, 2019 240,755 $ 72.00 3.16 Warrants expired - $ - Warrants exercised - $ - Outstanding September 30, 2019 244,755 $ 72.00 2.90

Net Loss Per Common Share

Net Loss Per Common Share	3 Months Ended
	Sep. 30, 2019
Earnings Per Share [Abstract]
Net Loss Per Common Share	Basic income (loss) per common share is calculated by dividing the net income (loss) available to the common shareholders by the weighted average number of common shares outstanding during that period. Diluted net loss per share reflects the potential of securities that could share in the net loss of Aytu. Basic and diluted loss per share was the same in 2019 and 2018, they were not included in the calculation of the diluted net loss per share because they would have been anti-dilutive. The following table sets-forth securities that could be potentially dilutive, but as of the quarters ended September 30, 2019 and 2018 are anti-dilutive, and therefore excluded from the calculation of diluted earnings per share. Three Months Ended September 30 2019 2018 Warrants to purchase common stock - liability classified (Note 14) 240,755 240,755 Warrant to purchase common stock - equity classified (Note 14) 16,218,908 1,641,906 Employee stock options (Note 13) 1,556 1,787 Employee unvested restricted stock (Note 13) 2,342,604 37,890 Convertible preferred stock (Note 12) 3,151,148 – 21,954,971 1,922,338

Subsequent Events

Subsequent Events	3 Months Ended
	Sep. 30, 2019
Subsequent Events [Abstract]
Subsequent Events	See Footnotes 1, 10 and 12 for information relating to events occurring subsequent to September 30, 2019.

Nature of Business, Financial_2

Nature of Business, Financial Condition, Basis of Presentation (Policies)	3 Months Ended
	Sep. 30, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Nature of Business	Nature of Business. The Company is currently focused on commercialization of four products, (i) Natesto®, a testosterone replacement therapy, or TRT, (ii) Tuzistra® XR, a codeine–based antitussive, (iii) ZolpiMist™, a short-term insomnia treatment and (iv), MiOXSYS®, a novel in vitro diagnostic system for male infertility assessment. In the future the Company will look to acquire additional commercial-stage or near-market products, including existing products we believe can offer distinct clinical advantages and patient benefits over existing marketed products. The management team’s prior experience has involved identifying both clinical-stage and commercial-stage assets that can be launched or re-launched to increase value, with a focused commercial infrastructure specializing in novel, niche products.
Financial Condition	Financial Condition. On October 11, 2019, the Company entered into Securities Purchase Agreements (the “Purchase Agreement”) with two institutional investors (the “Investors”) providing for the issuance and sale by the Company (the “Offering”) of $10.0 million of, (i) shares of the Company’s Series F Convertible Preferred Stock (the “Preferred Stock”) which are convertible into shares of common stock (the “Conversion Shares”) and (ii) warrants (the “Warrants”) which are exercisable for shares of common stock (the “Warrant Shares”). The Warrants have an exercise price equal to $1.25 and contain cashless exercise provisions. Each Warrant will be exercisable after we obtain stockholder approval as required by applicable Nasdaq rules (“Shareholder Approval”) and will expire five years from the time a registration statement covering the Conversion Shares and Warrant Shares is declared effective by the Securities and Exchange Commission. The closing of the sale of these securities occurred on October 16, 2019. The net proceeds that the Company received from the Offering were approximately $9.3 million. The net proceeds received by the Company from the Offering will be used for general corporate purposes, including working capital. As of the date of this Report, the Company expects its commercial costs for its current operation to remain approximately flat or to increase modestly as the Company continues to focus on revenue growth through increasing product sales. The Company’s current asset position of $31.0 million plus the proceeds expected from ongoing product sales will be used to fund operations. The Company will access the capital markets to fund operations if and when needed, and to the extent it is required. The timing and amount of capital that may be raised is dependent on market conditions and the terms and conditions upon which investors would require to provide such capital. There is no guarantee that capital will be available on terms favorable to the Company and its stockholders, or at all. However, the Company has been successful in accessing the capital markets in the past and is confident in its ability to access the capital markets again, if needed. Since the Company does not have sufficient cash and cash equivalents on-hand as of September 30, 2019 to cover potential net cash outflows for the twelve months following the filing date of this Quarterly Report, ASU 2014-15, Presentation of Financial Statements—Going Concern (Subtopic 205-40) requires the Company to report that there exists an indication of substantial doubt about its ability to continue as a going concern. If the Company is unable to raise adequate capital in the future when it is required, the Company can adjust its operating plans to reduce the magnitude of the capital need under its existing operating plan. Some of the adjustments that could be made include delays of and reductions to commercial programs, reductions in headcount, narrowing the scope of the Company’s commercial plans, or reductions to its research and development programs. Without sufficient operating capital, the Company could be required to relinquish rights to products or renegotiate to maintain such rights on less favorable terms than it would otherwise choose. This may lead to impairment or other charges, which could materially affect the Company’s balance sheet and operating results.
Recent Acquisition Agreements	Recent acquisition agreements. The Merger Agreement, agreed to on September 12, 2019, by both the Company and Innovus will cause, upon closing of the merger, for the Company to retire all of the outstanding common stock of Innovus for an aggregate of up to $8 million in shares of the Company’s common stock, less certain deductions (includes approximately $1.4 million in cash borrowed by Innovus from the Company during this time period (see Note 10)). This initial consideration to Innovus common shareholders is estimated to consist of primarily 4.2 million shares of the Company’s stock, and up to 1.5 million shares of the Company’s stock to satisfy certain warrant holders’ obligation. Additional consideration for up to $16 million in milestone payments in the form of contingent value rights (CVRs) may be paid to Innovus shareholders in cash or stock over the next five years if certain revenue and profitability milestones are achieved. Innovus specializes in commercializing, licensing and developing safe and effective over-the-counter consumer health products. The Company does not anticipate that this transaction will formally close until the quarter ended March 31, 2020 and is subject to approval by the shareholders of both the Company and Innovus. The Asset Purchase Agreement agreed to on October 10, 2019, between the Company and Cerecor, caused upon the November 1, 2019 closing, the Company to pay $4.5 million in cash, issue approximately 9.8 million shares of Series G Convertible Preferred Stock and assume certain of Seller’s financial and royalty obligations, which includes approximately $16.6 million of fixed payment obligations to a third-party creditor and not more than $3.5 million of Medicaid rebates and products returns. The Commercial Portfolio consists of six pharmaceutical and other prescription products competing in markets exceeding $8 billion in annual sales in the United States. In addition, the Company will be assuming the majority of the Cerecor’s commercial sales, commercial contracts and customer relationship workforce. In addition, the Company has assumed obligations due to an investor including fixed and variable payments. The Company assumed fixed monthly payments equal to $0.1 million from November 2019 through January 2021 plus $15 million due in January 2021. Monthly variable payments due to the same investor are equal to 15% of net revenue generated from a subset of the Product Portfolio, subject to an aggregate monthly minimum of $0.1 million, except for January 2020, when a one-time payment of $0.2 million is due. The variable payment obligation continues until aggregate variable payments of approximately $9.5 million have been made. Further, certain of the products in the Product Portfolio require royalty payments ranging from 15% to 23.5% of net revenue. One of the products in the Product Portfolio requires the Company to generate minimum annual sales sufficient to represent annual royalties of $1.8 million. Nasdaq Listing Compliance. ,
Basis of Presentation	Basis of Presentation.
Accounting Pronouncements	Adoption of New Accounting Pronouncements Leases (“ASU 2016-02”). Topic 842 Leases. The Company has elected to apply the short-term scope exception for leases with terms of 12 months or less at the inception of the lease and will continue to recognize rent expense on a straight-line basis. As a result of the adoption, on July 1, 2019, the Company recognized a lease liability of approximately $0.4 million, which represented the present value of the remaining minimum lease payments using an estimated incremental borrowing rate of 8%. As of September 30, 2019, the Company recognized a right-to-use asset of approximately $0.4 million. Lease expense did not change materially as a result of the adoption of ASU 2016-02. Recently Accounting Pronouncements Fair Value Measurements (“ASU 2018-03”). The amendments on changes in unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements, and the narrative description of measurement uncertainty should be applied prospectively for only the most recent interim or annual period presented in the initial fiscal year of adoption. All other amendments should be applied retrospectively to all periods presented upon their effective date. Early adoption is permitted upon issuance of ASU 2018-13. An entity is permitted to early adopt any removed or modified disclosures upon issuance of ASU 2018-13 and delay adoption of the additional disclosures until their effective date. The Company is currently assessing the impact that ASU 2018-13 will have on its financial statements. Financial Instruments – Credit Losses (“ASU 2016-13”). This Quarterly Report on Form 10-Q does not discuss recent pronouncements that are not anticipated to have an impact on or are unrelated to its financial condition, results of operations, cash flows or disclosures.

Revenue Recognition (Tables)

Revenue Recognition (Tables)	3 Months Ended
	Sep. 30, 2019
Revenue from Contract with Customer [Abstract]
Schedule product revenues by geographic location	Three Months Ended September 30, 2019 2018 U.S. $ 1,262,000 $ 1,273,000 International 178,000 159,000 Total net revenue $ 1,440,000 $ 1,432,000

Inventories (Tables)

Inventories (Tables)	3 Months Ended
	Sep. 30, 2019
Inventory Disclosure [Abstract]
Schedule of inventory balances	As of As of September 30, June 30, 2019 2019 Raw materials $ 154,000 $ 117,000 Finished goods 1,227,000 1,323,000 $ 1,381,000 $ 1,440,000

Fixed Assets (Tables)

Fixed Assets (Tables)	3 Months Ended
	Sep. 30, 2019
Property, Plant and Equipment [Abstract]
Schedule of fixed assets and depreciation expense	As of As of Estimated September 30, June 30, Useful Lives in years 2019 2019 Manufacturing equipment 2 - 5 $ 83,000 $ 83,000 Leasehold improvements 3 112,000 112,000 Office equipment, furniture and other 2 - 5 265,000 315,000 Lab equipment 3 - 5 90,000 90,000 Less accumulated depreciation and amortization (412,000 ) (396,000 ) Fixed assets, net $ 138,000 $ 204,000

Leases, Right-to-Use Assets a_2

Leases, Right-to-Use Assets and Related Liabilities (Tables)	3 Months Ended
	Sep. 30, 2019
Leases Righttouse Assets And Related Liabilities Tables Abstract
Lease liability	Total 2020 2021 2022 2023 2024 Thereafter Remaining Office leases 463,000 81,000 113,000 118,000 121,000 30,000 - Less: Discount Adjustment (69,000 ) Total lease liability 394,000 Lease liability - current portion 79,000 Long-term lease liability 315,000
Rent expense	Three Months Ended September 30, 2019 2018 Rent expense $ 32,000 $ 32,000

Patents (Tables)

Patents (Tables)	3 Months Ended
	Sep. 30, 2019
Goodwill and Intangible Assets Disclosure [Abstract]
Schedule of patents	As of As of September 30, June 30, 2019 2019 Patents $ 380,000 $ 380,000 Less accumulated amortization (166,000 ) (159,000 ) Patents, net $ 214,000 $ 221,000

Accrued liabilities (Tables)

Accrued liabilities (Tables)	3 Months Ended
	Sep. 30, 2019
Accrued Liabilities
Accrued liabilities	As of As of September 30, June 30, 2019 2019 Accrued accounting fee $ 42,000 $ 85,000 Accrued program liabilities 843,000 736,000 Accrued product-related fees 133,000 295,000 Customer overpayment 79,000 − Other accrued liabilities* 54,000 32,000 Total accrued liabilities $ 1,151,000 $ 1,148,000 * Other accrued liabilities consist of franchise tax, samples and consultants, none of which individually represent greater than five percent of total current liabilities.

Fair Value Considerations (Tabl

Fair Value Considerations (Tables)	3 Months Ended
	Sep. 30, 2019
Fair Value Disclosures [Abstract]
Schedule of fair value on a recurring basis	Fair Value Measurements at September 30, 2019 Fair Value at September 30, 2019 Quoted Priced in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs(Level 2) Significant Unobservable Inputs(Level 3) Recurring: Warrant derivative liability 11,000 $ - $ - $ 11,000 Contingent consideration 23,509,000 $ - $ - $ 23,509,000 23,520,000 - - 23,520,000 Fair Value Measurements at June 30, 2019 Fair Value at June 30, 2019 Quoted Priced in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs(Level 2) Significant Unobservable Inputs(Level 3) Recurring: Warrant derivative liability 13,000 $ - $ - $ 13,000 Contingent consideration 23,326,000 $ - $ - $ 23,326,000 23,339,000 - - 23,339,000
Schedule of significant assumptions in valuing the warrant derivative liability	As of September 30, 2019 As of June 30, 2019 At Issuance Warrant Derivative Liability Volatility 163.2 % 163.2 % 188.0 % Equivalent term (years) 2.88 3.13 5.00 Risk-free interest rate 1.71 % 1.71 % 1.83 % Dividend yield 0.00 % 0.00 % 0.00 %
Schedule of reconciliation of changes in the warrant derivative liability	Liability Classified Warrants Balance as of June 30, 2019 $ 13,000 Change in fair value included in earnings (2,000 ) Balance as of September 30, 2019 $ 11,000
Schedule of changes in the contingent consideration	Contingent Consideration Balance as of June 30, 2019 $ 23,326,000 Increase due to accretion 229,000 Decrease due to contractual payment (46,000 ) Balance as of September 30, 2019 $ 23,509,000

Commitments and Contingencies (

Commitments and Contingencies (Tables)	3 Months Ended
	Sep. 30, 2019
Commitments and Contingencies Disclosure [Abstract]
Schedule of commitments and contingencies	Total 2020 2021 2022 2023 2024 Thereafter Prescription database $ 1,469,000 $ 423,000 $ 534,000 $ 512,000 $ - $ - $ - Product milestone payments 5,500,000 - - - 5,500,000 - - $ 6,969,000 $ 423,000 $ 534,000 $ 512,000 $ 5,500,000 $ - $ -

Equity Incentive plan (Tables)

Equity Incentive plan (Tables)	3 Months Ended
	Sep. 30, 2019
Share-based Payment Arrangement [Abstract]
Schedule of stock option activity	Number of Options Weighted Average Exercise Price Weighted Average Remaining Contractual Life in Years Outstanding June 30, 2019 1,607 $ 325.73 6.13 Expired (51 ) 328.00 Outstanding September 30, 2019 1,556 325.66 6.08 Exercisable at September 30, 2019 1,544 $ 325.64 6.08
Schedule of restricted stock activity	Number of Shares Weighted Average Grant Date Fair Value Weighted Average Remaining Contractual Life in Years Unvested at June 30, 2019 2,436,214 $ 1.83 9.1 Granted – – Vested – – Forfeited (5,150 ) $ 2.44 Unvested at September 30, 2019 2,431,064 $ 1.83 7.2
Schedule of stock-based compensation expense	Three Months Ended September 30, Selling, general and administrative: 2019 2018 Stock options $ 5,000 $ 66,000 Restricted stock 160,000 86,000 Total stock-based compensation expense $ 165,000 $ 152,000

Warrants (Tables)

Warrants (Tables)	3 Months Ended
	Sep. 30, 2019
Warrants Tables Abstract
Summary of all warrants	A summary of equity-based warrants is as follows: Number of Warrants Weighted Average Exercise Price Weighted Average Remaining Contractual Life in Years Outstanding June 30, 2019 16,218,908 $ 3.15 4.36 Warrants expired - $ - Warrants exercised - $ - Outstanding September 30, 2019 16,218,908 $ 3.15 4.11 A summary of liability warrants is as follows: Number of Warrants Weighted Average Exercise Price Weighted Average Remaining Contractual Life in Years Outstanding June 30, 2019 240,755 $ 72.00 3.16 Warrants expired - $ - Warrants exercised - $ - Outstanding September 30, 2019 244,755 $ 72.00 2.90

Net Loss Per Common Share (Tabl

Net Loss Per Common Share (Tables)	3 Months Ended
	Sep. 30, 2019
Earnings Per Share [Abstract]
Securities excluded from the calculation of diluted earnings per share	Three Months Ended September 30 2019 2018 Warrants to purchase common stock - liability classified (Note 14) 240,755 240,755 Warrant to purchase common stock - equity classified (Note 14) 16,218,908 1,641,906 Employee stock options (Note 13) 1,556 1,787 Employee unvested restricted stock (Note 13) 2,342,604 37,890 Convertible preferred stock (Note 12) 3,151,148 – 21,954,971 1,922,338

Revenue Recognition (Details)

Revenue Recognition (Details) - USD ($)	3 Months Ended
	Sep. 30, 2019	Sep. 30, 2018
Total net revenue	$ 1,440,000	$ 1,432,000
U.S.
Total net revenue	1,262,000	1,273,000
Rest-of-the-World
Total net revenue	$ 178,000	$ 159,000

Product Licenses (Details Narra

Product Licenses (Details Narrative) - USD ($)	3 Months Ended
	Sep. 30, 2019	Sep. 30, 2018
Amortization expense	$ 16,000	$ 28,000
Natesto [Member]
Amortization expense	300,000	300,000
Contingent consideration accretion expense	79,000	15,000
ZolpiMist [Member]
Amortization expense	100,000	100,000
Contingent consideration accretion expense	100,000	100,000
Tuzistra XR [Member]
Amortization expense	123,000	0
Contingent consideration accretion expense	$ 96,000	$ 0

Inventories (Details)

Inventories (Details) - USD ($)	Sep. 30, 2019	Jun. 30, 2019
Inventory Disclosure [Abstract]
Raw materials	$ 154,000	$ 117,000
Finished Goods	1,227,000	1,323,000
Inventory balance	$ 1,380,729	$ 1,440,069

Inventories (Details Narrative)

Inventories (Details Narrative) - USD ($)	3 Months Ended
	Sep. 30, 2019	Sep. 30, 2018
Inventory Disclosure [Abstract]
inventory write-down	$ 0	$ 0

Fixed Assets (Details)

Fixed Assets (Details) - USD ($)	3 Months Ended
	Sep. 30, 2019	Jun. 30, 2019
Less accumulated depreciation and amortization	$ (412,000)	$ (396,000)
Fixed assets, net	137,900	203,733
Manufacturing Equipment [Member]
Fixed assets, gross	$ 83,000	83,000
Manufacturing Equipment [Member] | Minimum [Member]
Estimated useful lives in years	2 years
Manufacturing Equipment [Member] | Maximum [Member]
Estimated useful lives in years	5 years
Leasehold Improvements [Member]
Estimated useful lives in years	3 years
Fixed assets, gross	$ 112,000	112,000
Office Equipment, Furniture and Other [Member]
Fixed assets, gross	$ 265,000	315,000
Office Equipment, Furniture and Other [Member] | Minimum [Member]
Estimated useful lives in years	2 years
Office Equipment, Furniture and Other [Member] | Maximum [Member]
Estimated useful lives in years	5 years
Lab Equipment [Member]
Fixed assets, gross	$ 90,000	$ 90,000
Lab Equipment [Member] | Minimum [Member]
Estimated useful lives in years	3 years
Lab Equipment [Member] | Maximum [Member]
Estimated useful lives in years	5 years

Fixed Assets (Details Narrative

Fixed Assets (Details Narrative) - USD ($)	3 Months Ended
	Sep. 30, 2019	Sep. 30, 2018
Property, Plant and Equipment [Abstract]
Depreciation and amortization expense	$ 16,000	$ 28,000

Leases, Right-to-Use Assets a_3

Leases, Right-to-Use Assets and Related Liabilities (Details) - USD ($)	Sep. 30, 2019	Jun. 30, 2019
Leases Righttouse Assets And Related Liabilities Details Abstract
2020	$ 81,000
2021	113,000
2022	118,000
2023	121,000
2024	30,000
Thereafter	0
Total	463,000
Less: Discount adjustment	(69,000)
Total lease liability	394,000
Lease liability current portion	79,362	$ 0
Long-term lease liability	$ 314,457	$ 0

Leases, Right-to-use Assets a_4

Leases, Right-to-use Assets and Related Liabiliities (Details 1) - USD ($)	3 Months Ended
	Sep. 30, 2019	Sep. 30, 2018
Leases Right-to-use Assets And Related Liabiliities
Rent expense	$ 32,000	$ 32,000

Patents (Details)

Patents (Details) - USD ($)	Sep. 30, 2019	Jun. 30, 2019
Goodwill and Intangible Assets Disclosure [Abstract]
Patents	$ 380,000	$ 380,000
Less accumulated amortization	(166,000)	(159,000)
Patents, net	$ 214,278	$ 220,611

Patents (Details Narrative)

Patents (Details Narrative) - USD ($)	3 Months Ended
	Sep. 30, 2019	Sep. 30, 2018
Goodwill and Intangible Assets Disclosure [Abstract]
Patent amortization expense	$ 6,000	$ 6,000

Accrued liabilities (Details)

Accrued liabilities (Details) - USD ($)	Sep. 30, 2019	Jun. 30, 2019
Accrued Liabilities
Accrued accounting fee	$ 42,000	$ 85,000
Accrued program liabilities	843,000	736,000
Accrued product-related fees	133,000	295,000
Customer overpayment	79,000	0
Other accrued liabilities	54,000	32,000
Total accrued liabilities	$ 1,151,181	$ 1,147,740

Fair Value Considerations (Deta

Fair Value Considerations (Details) - USD ($)	Sep. 30, 2019	Jun. 30, 2019
Warrant derivative liability	$ 11,371	$ 13,201
Contingent consideration	23,509,000	23,326,000
Total	23,520,000	23,339,000
Fair Value, Inputs, Level 1 [Member] | Fair Value, Measurements, Recurring [Member]
Warrant derivative liability	0	0
Contingent consideration	0	0
Total	0	0
Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Recurring [Member]
Warrant derivative liability	0	0
Contingent consideration	0	0
Total	0	0
Level 3 [Member | Fair Value, Measurements, Recurring [Member]
Warrant derivative liability	11,000	13,000
Contingent consideration	23,509,000	23,326,000
Total	$ 23,520,000	$ 23,339,000

Fair Value Considerations (De_2

Fair Value Considerations (Details 1)	3 Months Ended	12 Months Ended
	Sep. 30, 2019	Jun. 30, 2019
Volatility		163.20%
Equivalent term (years)		3 years 1 month 17 days
Risk-free interest rate		1.71%
Dividend yield		0.00%
Warrant [Member]
Volatility	163.20%
Equivalent term (years)	2 years 10 months 17 days
Risk-free interest rate	1.71%
Dividend yield	0.00%
Warrant [Member] | At Issuance [Member]
Volatility	188.00%
Equivalent term (years)	5 years
Risk-free interest rate	1.83%
Dividend yield	0.00%

Fair Value Considerations (De_3

Fair Value Considerations (Details 2) - Level 3 [Member	3 Months Ended
	Sep. 30, 2019USD ($)
Beginning balance	$ 13,000
Change in fair value included in earnings	(2,000)
Ending balance	$ 11,000

Fair Value Considerations (De_4

Fair Value Considerations (Details 3)	3 Months Ended
	Sep. 30, 2019USD ($)
Fair Value Disclosures [Abstract]
Beginning balance	$ 23,326,000
Increase due to accretion	229,000
Decrease due to contractual payment	(46,000)
Ending balance	$ 23,509,000

Commitments and Contingencies_2

Commitments and Contingencies (Details)	Sep. 30, 2019USD ($)
2020	$ 423,000
2021	534,000
2022	512,000
2023	5,500,000
2024	0
Thereafter	0
Total	6,969,000
Prescription Database [Member]
2020	423,000
2021	534,000
2022	512,000
2023	0
2024	0
Thereafter	0
Total	1,469,000
Milestone Payments [Member]
2020	0
2021	0
2022	0
2023	5,500,000
2024	0
Thereafter	0
Total	$ 5,500,000

Capital Structure (Details Narr

Capital Structure (Details Narrative) - $ / shares	Sep. 30, 2019	Jun. 30, 2019
Equity [Abstract]
Preferred stock, par value	$ .0001	$ .0001
Preferred stock, shares authorized	50,000,000	50,000,000
Preferred stock, shares issued	3,151,148	3,594,981
Preferred stock, shares outstanding	3,151,148	3,594,981
Common stock, par value	$ .0001	$ .0001
Common stock, shares authorized	100,000,000	100,000,000
Common stock, shares issued	17,981,094	17,538,071
Common stock, shares outstanding	17,981,094	17,538,071

Equity Incentive Plan (Details)

Equity Incentive Plan (Details) - Equity Option [Member]	3 Months Ended
	Sep. 30, 2019$ / sharesshares
Number of Options
Number of options outstanding, beginning balance | shares	1,607
Number of options, expired | shares	(51)
Number of options outstanding, ending balance | shares	1,556
Number of options, exercisable | shares	1,544
Weighted Average Exercise Price
Weighted average exercise price, beginning balance | $ / shares	$ 325.73
Weighted average exercise price, expired | $ / shares	328
Weighted average exercise price, ending balance | $ / shares	325.66
Weighted average exercise price, exercisable | $ / shares	$ 325.64
Weighted Average Remaining Contractual Life in Years
Weighted average remaining contractual life in years, outstanding, beginning balance	6 years 1 month 17 days
Weighted average remaining contractual life in years, outstanding, ending balance	6 years 29 days
Weighted average remaining contractual life in years, exercisable	6 years 29 days

Equity Incentive Plan (Details

Equity Incentive Plan (Details 1)	12 Months Ended
	Jun. 30, 2019
Expected volatility	163.20%
Risk-free interest rate	1.71%
Equivalent term (years)	3 years 1 month 17 days
Dividend yield	0.00%

Equity Incentive Plan (Detail_2

Equity Incentive Plan (Details 2) - Restricted Stock [Member]	3 Months Ended
	Sep. 30, 2019$ / sharesshares
Number of Shares
Unvested, beginning balance | shares	2,436,214
Granted | shares	0
Vested | shares	0
Forfeited | shares	(5,150)
Unvested, ending balance | shares	2,431,064
Weighted Average Grant Date Fair Value
Unvested, beginning balance | $ / shares	$ 1.83
Granted | $ / shares	0
Vested | $ / shares	0
Forfeited | $ / shares	2.44
Unvested, ending balance | $ / shares	$ 1.83
Weighted Average Remaining Contractual Life in Years
Unvested beginning, weighted average remaining contractual life in years	9 years 1 month 6 days
Unvested ending, weighted average remaining contractual life in years	7 years 2 months 12 days

Equity Incentive Plan (Detail_3

Equity Incentive Plan (Details 3) - USD ($)	3 Months Ended
	Sep. 30, 2019	Sep. 30, 2018
Total share-based compensation expense	$ 165,000	$ 152,000
Restricted Stock [Member]
Total share-based compensation expense	160,000	86,000
Employee Stock Option
Total share-based compensation expense	$ 5,000	$ 66,000

Equity Incentive Plan (Detail_4

Equity Incentive Plan (Details Narrative)	3 Months Ended
	Sep. 30, 2019USD ($)shares
Restricted Stock [Member]
Shares available for grant | shares	1,540
Unrecognized expense share-based compensation expense	$ 3,755,000
Weighted-average period	8 years 9 months 25 days
Expense related to awards	$ 1,347,000
2015 Plan [Member]
Shares available for grant | shares	567,380
Unrecognized expense share-based compensation expense	$ 2,000
Weighted-average period	1 month 13 days

Warrants (Details)

Warrants (Details)	3 Months Ended
	Sep. 30, 2019$ / sharesshares
Equity-Based Warrants
Number of Warrants
Number of warrants, outstanding beginning balance | shares	16,218,908
Warrants expired | shares	0
Warrants exercised | shares	0
Number of warrants outstanding, ending balance | shares	16,218,908
Weighted Average Exercise Price
Weighted average exercise price, beginning balance | $ / shares	$ 3.15
Warrants expired | $ / shares	.00
Warrants exercised | $ / shares	.00
Weighted average exercise price, ending balance | $ / shares	$ 3.15
Weighted Average Remaining Contractual Life in Years
Weighted average remaining contractual life in years, outstanding, beginning balance	4 years 4 months 10 days
Weighted average remaining contractual life in years, outstanding, ending balance	4 years 1 month 10 days
Liability Warrants
Number of Warrants
Number of warrants, outstanding beginning balance | shares	240,755
Warrants expired | shares	0
Warrants exercised | shares	0
Number of warrants outstanding, ending balance | shares	240,755
Weighted Average Exercise Price
Weighted average exercise price, beginning balance | $ / shares	$ 72
Warrants expired | $ / shares	.00
Warrants exercised | $ / shares	.00
Weighted average exercise price, ending balance | $ / shares	$ 72
Weighted Average Remaining Contractual Life in Years
Weighted average remaining contractual life in years, outstanding, beginning balance	3 years 1 month 28 days
Weighted average remaining contractual life in years, outstanding, ending balance	2 years 10 months 24 days

Net Loss Per Common Share (Deta

Net Loss Per Common Share (Details) - shares	3 Months Ended
	Sep. 30, 2019	Sep. 30, 2018
Antidilutive securities	21,954,971	1,922,338
Liability Warrants
Antidilutive securities	240,755	240,755
Equity-Based Warrants
Antidilutive securities	16,218,908	1,641,906
Employee Stock Option
Antidilutive securities	1,787	1,556
Employee Unvested Restricted Stock
Antidilutive securities	2,342,604	37,890
Convertible Preferred Stock
Antidilutive securities	3,151,148	0