Significant Accounting Policies [Text Block] | NOTE 2. Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) and are expressed in U.S. dollars. In management’s opinion, the unaudited condensed consolidated financial statements include all normal and recurring adjustments that are considered necessary for the fair presentation of the Company’s financial position and operating results. Use of Estimates The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the unaudited condensed consolidated financial statements and accompanying notes. These estimates include contract liabilities related to product sales, useful lives for property and equipment and related depreciation calculations, assumptions for valuing options and warrants, the fair value of contingent consideration, intangible assets, goodwill, stock-based compensation, income taxes and other contingencies as of September 30, 2022. These estimates are based on management’s best estimates and judgment. Actual results may Unaudited Interim Financial Information The accompanying unaudited interim condensed consolidated financial statements and related disclosures have been prepared on the same basis as the annual consolidated financial statements and, in the opinion of management, reflect all adjustments, which include only recurring adjustments, necessary for a fair presentation. The year-end condensed consolidated balance sheet date was derived from audited consolidated financial statement but does not not The financial statements and notes included herein should be read in conjunction with the annual consolidated financial statements and notes for the year ended December 31, 2021, 10 December 31, 2021, March 29, 2022. Change in Accounting and Revision of Prior Period Financial Statements During the three September 30, 2022, third no not While reviewing its accounting policy for fulfillment fees, the Company identified an error in its previously issued financial statements whereby the Company has been incorrectly presenting revenue net of selling commissions paid to third three September 30, 2022, 2022, 2021 2020 no not Cash, Cash Equivalents, and Restricted Cash The Company considers all highly-liquid instruments with a stated maturity of three September 30, 2022 December 31, 2021, The following table provides a reconciliation of the cash, cash equivalents, and restricted cash reported in the condensed consolidated balance sheets (in thousands): September 30, December 31, 2022 2021 Cash and cash equivalents $ 3,868 $ 7,504 Restricted cash included in other assets 152 475 Total cash, cash equivalents, and restricted cash in the condensed consolidated balance sheets $ 4,020 $ 7,979 The restricted cash amount included in other assets on the condensed consolidated balance sheets represents amounts held as certificates of deposit for long-term financing and lease arrangements as contractually required by our financial institution and landlord. Concentrations of Credit Risk and Major Partners Financial instruments that potentially subject us to significant concentrations of credit risk consist primarily of cash, cash equivalents and restricted cash. The Company maintains deposits of cash, cash equivalents and restricted cash with a highly-rated, major financial institution in the United States. Deposits in this bank may not During the three nine September 30, 2022 2021, three nine September 30, 2022, During the three nine September 30, 2022 2021, Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Avenova Spray $ 1,939 $ 2,145 $ 5,778 $ 6,358 DERMAdoctor 1,319 — 3,115 — NeutroPhase — — 657 175 Other products 558 114 1,193 479 Total product revenue, net 3,816 2,259 10,743 7,012 Other revenue, net 10 6 18 19 Total sales, net $ 3,826 $ 2,265 $ 10,761 $ 7,031 During the three September 30, 2022 2021, nine September 30, 2022 2021, No 10% three nine September 30, 2022 2021. As of September 30, 2022 December 31, 2021, 10% September 30, December 31, Major distribution partner 2022 2021 Avenova Spray Pharmacy Distributor A 24 % 11 % Avenova Spray Pharmacy Distributor B * % 13 % Major U.S. Retailer A 20 % 33 % * Less than 10% The Company relies on seven not third may may not may Fair Value of Financial Assets and Liabilities The Company’s financial instruments include cash and cash equivalents, restricted cash, accounts receivable, accounts payable, accrued liabilities, warrant liabilities, and contingent consideration. The Company’s cash and cash equivalents, accounts receivable, accounts payable, and accrued liabilities are carried at cost, which management believes approximates fair value due to the short-term nature of these instruments. The Company follows Accounting Standards Codification (“ASC”) 820, Fair Value Measurements and Disclosures three may Level 1 Level 2 Level 3 Categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Allowance for Doubtful Accounts The Company charges bad debt expense and records an allowance for doubtful accounts when management believes it to be unlikely that specific invoices will be collected. Management identifies amounts due that are in dispute and believes are unlikely to be collected. At September 30, 2022, December 31, 2021. Inventory Inventory is comprised of ( 1 2 3 first first September 30, 2022 December 31, 2021, Property and Equipment, net Property and equipment are stated at cost, less accumulated depreciation and amortization. Depreciation is calculated using the straight-line method over the estimated useful lives of the related assets of five seven three five five seven The costs of normal maintenance, repairs, and minor replacements are expensed as incurred. Business Combinations We account for 805, Business Combinations The determination of estimated fair value requires us to make significant estimates and assumptions. These fair value determinations require judgment and involve the use of significant estimates and assumptions, including assumptions with respect to future cash inflows and outflows, discount rates, and asset lives, among other items. As a result, we may one Transaction costs associated with business combinations are expensed as they are incurred. Goodwill and Intangible Assets Goodwill represents the excess of the consideration transferred over the estimated fair value of assets acquired and liabilities assumed in a business combination. Intangible assets are measured at their respective fair values as of the acquisition date and may may one not September 30, 2022 December 31, 2021. Valuation of Contingent Consideration Resulting from a Business Combination In connection with certain acquisitions, including the acquisition of DERMAdoctor, we may Increases or decreases in fair value of the contingent consideration liabilities can result from updates to assumptions such as the expected timing or probability of achieving the specified milestones. Significant judgment is employed in determining these assumptions as of the acquisition date and for each subsequent period. Updates to assumptions could have a significant impact on our results of operations in any given period. Actual results may Impairment of Long-Lived Assets The Company accounts for long-lived assets, other than goodwill and intangible assets, and operating lease right-of-use assets in accordance with ASC 360, Property, Plant and Equipment may may not no not no September 30, 2022 December 31, 2021. Leases At the inception of an arrangement, the Company determines whether the arrangement is or contains a lease based on the unique facts and circumstances present. Operating lease liabilities and their corresponding right-of-use assets are recorded based on the present value of lease payments over the expected lease term. The interest rate implicit in lease contracts is typically not may The Company has elected to combine lease and non-lease components as a single component for all leases in which it is a lessee or a lessor. The lease expense is recognized over the expected term on a straight-line basis. Operating leases are recognized on the balance sheet as right-of-use assets, operating lease liabilities current and operating lease liabilities non-current. Comprehensive Income (Loss) ASC 220, Comprehensive Income, Revenue Recognition Revenue is recognized from sale of goods in accordance with ASC 606, Revenue from Contracts with Customers 606” 606, 606, five 606: i. identify the contract(s) with a customer; ii. identify the performance obligations in the contract; iii. determine the transaction price; iv. allocate the transaction price to the performance obligations in the contract; and v. recognize revenue when (or as) the entity satisfies performance obligations. Revenue is generated through the Company’s webstores, Avenova.com and DERMAdoctor.com, for Avenova and DERMAdoctor products. Such direct to consumer sales are recognized upon fulfillment, which generally occurs upon delivery of the related products to a third Revenue generated through third third The Company pays third third 2022, third 2022, Prior to the third 2022, third not third 2022, third 2022, not not Prior to the third 2022, third 2022, third 2022 2022, 2021 2020 no not Financial statement line items included in the condensed consolidated statements of operations and comprehensive loss for the three nine September 30, 2022 2021 Three Months Ended September 30, 2022 Nine Months Ended September 30, 2022 As Previously Reported Selling Commissions Fulfillment Fees As Revised As Previously Reported Selling Commissions Fulfillment Fees As Revised Sales Product revenue, net $ 3,268 $ 265 $ 283 $ 3,816 $ 8,934 $ 851 $ 959 $ 10,743 Product cost of goods sold Product cost of goods sold 1,168 - 283 1,451 3,776 - 959 4,735 Operating expenses Sales and marketing 1,570 265 - 1,835 5,009 851 - 5,860 Net loss and comprehensive loss (136 ) - - (136 ) (2,402 ) - - (2,402 ) Net loss per share (basic and diluted) (0.10 ) - - (0.10 ) (0.15 ) - - (0.15 ) Three Months Ended September 30, 2021 Nine Months Ended September 30, 2021 As Previously Reported Selling Commissions Fulfillment Fees As Revised As Previously Reported Selling Commissions Fulfillment Fees As Revised Sales Product revenue, net $ 1,834 $ 206 $ 219 $ 2,259 $ 5,761 $ 619 $ 632 $ 7,012 Product cost of goods sold Product cost of goods sold 493 219 712 1,562 632 2,194 Operating expenses Sales and marketing 1,855 206 2,061 5,323 619 5,942 Net loss and comprehensive loss (2,289 ) - - (2,289 ) (5,666 ) - - (5,666 ) Net loss per share (basic and diluted) (0.05 ) - - (0.05 ) (0.13 ) - - (0.13 ) The Company also generates Avenova Spray revenue through major pharmacy distribution partners. Product supply of Avenova Spray is the only performance obligation contained in these arrangements, and the Company recognizes product revenue upon transfer of control to its major distribution partners at the amount of consideration that the Company expects to be entitled to, generally upon delivery to the distributor on a “sell-in” basis. Upon recognition of product sales, contract liabilities are recorded for invoiced amounts that are subject to significant reversal, including product revenue allowances for cash consideration paid to customers for services, discounts, rebate programs, and product returns. The Company derives its rate of return from historical data and updates its return rate assumption quarterly. Payment for product supply is typically due 30 days after control transfers to the distributor. Revenue for products sales to Costco is recognized upon transfer of control to the amount of consideration that the Company expects to be entitled to, generally upon delivery to Costco. Upon recognition of product sales, contract liabilities are recorded for invoiced amounts that are subject to significant reversal, including discounts and product returns. The Company derives its rate of return from historical data and updates its return rate assumption quarterly. Payment for product supply is typically due 30 days after control transfers to Costco. Revenue generated through the Company’s partner pharmacies is recognized when control of the product transfers to the end customer. Revenue for product sales to other retailers, such as CVS, is generally recognized upon transfer of control to the retailer, which generally occurs upon delivery of the products to a third Cost of Goods Sold Cost of goods sold includes third third Research and Development Costs The Company charges research and development costs to expense as incurred. These costs include all costs associated with research, development and regulatory activities, including submissions to the Food and Drug Administration (the “FDA”). Patent Costs Patent costs, including legal expenses, are expensed in the period in which they are incurred. Patent expenses are included in general and administrative expenses in the condensed consolidated statements of operations and comprehensive loss. Advertising Costs Advertising costs are expensed in the period in which the costs are incurred. Advertising costs are included in sales and marketing expenses in the condensed consolidated statements of operations and comprehensive loss. Advertising expenses were $0.5 million and $0.8 million for the three September 30, 2022 2021, nine September 30, 2022 2021, Stock-Based Compensation The Company’s stock-based compensation includes grants of stock options and restricted stock units (“RSUs”) to employees, consultants and non-employee directors. The expense associated with these grants is recognized in the Company’s condensed consolidated statements of stockholders’ equity based on their fair values as they are earned under the applicable vesting terms. For stock options granted, the fair value of the stock options is estimated using a Black-Scholes option pricing model. See Note 15, Income Taxes The Company accounts for income taxes under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is recognized if it is more likely than not not Common Stock Warrant Liabilities The Company accounts for common stock purchase warrants issued in connection with its equity offerings in accordance with the provisions of ASC 480, Distinguishing Liabilities from Equity 815, Derivatives and Hedging The Company accounts for common stock purchase warrants issued in connection with share-based compensation arrangements in accordance with the provisions of ASC 718, Stock Compensation, 480, Distinguishing Liabilities from Equity The Company classifies as equity any contracts that (i) require physical settlement or net-share settlement or (ii) give the Company a choice of net-cash settlement or settlement in its own shares (physical settlement or net-share settlement). The Company classifies as assets or liabilities any contracts that (i) require net-cash settlement (including a requirement to net-cash settle the contract if an event occurs and if that event is outside the control of the Company), (ii) give the counterparty a choice of net-cash settlement or settlement in shares (physical settlement or net-share settlement) or (iii) do not 718, Stock Compensation, For warrants that are classified as liabilities, the Company records the fair value of the warrants at each balance sheet date and records changes in the estimated fair value as a non-cash gain or loss in the condensed consolidated statements of operations and comprehensive loss. The fair values of these warrants are determined using the Black-Scholes option pricing model, the Binomial Lattice (“Lattice”) valuation model, or the Monte Carlo simulation model where deemed appropriate. These values are subject to a significant degree of management’s judgment. Net Loss per Share The Company computes net loss per share by presenting both basic and diluted earnings (loss) per share (“EPS”). Basic EPS is computed by dividing net loss available to common stockholders by the weighted average number of common shares outstanding during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period, including stock options and warrants, using the treasury stock method. In computing diluted EPS, the average stock price for the period is used to determine the number of shares assumed to be purchased from the exercise of stock options or warrants. Potentially dilutive common share equivalents are excluded from the diluted EPS computation in net loss periods because their effect would be anti-dilutive. The following table sets forth the calculation of basic EPS and diluted EPS (in thousands, except per share amounts): Three Months Ended September 30, Nine Months Ended September 30, Numerator 2022 2021 2022 2021 Net loss $ (136 ) $ (2,289 ) $ (2,402 ) $ (5,666 ) Less: Increase in accumulated deficit due to Series B Preferred Stock conversion price 5,657 — 5,657 — Net loss attributable to common stockholders, basic and diluted $ (5,793 ) $ (2,289 ) $ (8,059 ) $ (5,666 ) Denominator Weighted average shares outstanding, basic and diluted 56,133 44,921 53,007 43,100 Net loss per share, basic and diluted $ (0.10 ) $ (0.05 ) $ (0.15 ) $ (0.13 ) The following outstanding preferred stock, stock options and stock warrants were excluded from the diluted EPS computation as their effect would have been anti-dilutive (in thousands): As of September 30, 2022 2021 Series B Preferred Stock common stock equivalents 64,561 — Stock options 4,743 3,947 Stock warrants 2,282 7,082 71,586 11,029 Recent Accounting Pronouncements For information regarding recent accounting pronouncements that could affect our business, results of operations, financial condition, and liquidity, see Note 2, 10 December 31, 2021, March 29, 2022. |