Evoke Pharma (EVOK) 10-Q 13 Aug 15 2015 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2015	Jul. 31, 2015
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jun. 30, 2015
Document Fiscal Year Focus	2,015
Document Fiscal Period Focus	Q2
Trading Symbol	EVOK
Entity Registrant Name	Evoke Pharma Inc
Entity Central Index Key	1,403,708
Current Fiscal Year End Date	--12-31
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		6,338,802

Condensed Balance Sheets

Condensed Balance Sheets - USD ($)	Jun. 30, 2015	Dec. 31, 2014
Current Assets:
Cash and cash equivalents	$ 9,883,088	$ 14,155,809
Prepaid expenses	716,616	931,461
Other current assets	7,997	137,812
Total current assets	10,607,701	15,225,082
Other assets		7,997
Total assets	10,607,701	15,233,079
Current Liabilities:
Accounts payable and accrued expenses	1,372,821	1,011,629
Accrued compensation	563,753	697,245
Other current liabilities	5,939	12,313
Current portion of long-term debt	1,251,806	126,806
Total current liabilities	3,194,319	1,847,993
Long-term debt, net of current portion	3,101,770	4,196,422
Total liabilities	6,296,089	6,044,415
Stockholders' equity:
Common stock, $0.0001 par value; authorized shares — 50,000,000; issued and outstanding shares — 6,306,130 and 6,112,091 at June 30, 2015 and December 31, 2014, respectively	631	611
Additional paid-in capital	47,012,041	45,127,202
Accumulated deficit	(42,701,060)	(35,939,149)
Total stockholders' equity	4,311,612	9,188,664
Total liabilities and stockholders' equity	$ 10,607,701	$ 15,233,079

Condensed Balance Sheets (Paren

Condensed Balance Sheets (Parenthetical) - $ / shares	Jun. 30, 2015	Dec. 31, 2014
Statement Of Financial Position [Abstract]
Common stock, par value	$ 0.0001	$ 0.0001
Common stock, shares authorized	50,000,000	50,000,000
Common stock, shares issued	6,306,130	6,112,091
Common stock, shares outstanding	6,306,130	6,112,091

Condensed Statements of Operati

Condensed Statements of Operations - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Operating expenses:
Research and development	$ 2,188,138	$ 2,874,977	$ 4,608,099	$ 4,727,093
General and administrative	976,418	616,888	2,001,679	1,687,367
Total operating expenses	3,164,556	3,491,865	6,609,778	6,414,460
Loss from operations	(3,164,556)	(3,491,865)	(6,609,778)	(6,414,460)
Other income (expense):
Interest income	1,129	3,215	2,651	7,270
Interest expense	(77,736)	(58,390)	(154,784)	(95,334)
Total other expense	(76,607)	(55,175)	(152,133)	(88,064)
Net loss	$ (3,241,163)	$ (3,547,040)	$ (6,761,911)	$ (6,502,524)
Net loss per common share, basic and diluted	$ (0.52)	$ (0.59)	$ (1.10)	$ (1.08)
Weighted-average shares used to compute basic and diluted net loss per share	6,212,803	6,027,672	6,157,226	6,015,310

Condensed Statements of Cash Fl

Condensed Statements of Cash Flows - USD ($)	6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014
Operating activities
Net loss	$ (6,761,911)	$ (6,502,524)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock-based compensation expense	756,138	488,520
Non-cash interest	30,348	48,170
Deferred rent expense	(6,374)	10,059
Change in operating assets and liabilities:
Prepaid expenses and other assets	214,845	(107,133)
Accounts payable and accrued expenses	227,700	994,701
Net cash used in operating activities	(5,539,254)	(5,068,207)
Financing activities
Payment on bank line of credit		(3,000,000)
Costs paid in connection with loan origination		(82,685)
Proceeds from issuance of common stock, net	1,266,533
Net cash provided by (used in) financing activities	1,266,533	(3,082,685)
Net decrease in cash and cash equivalents	(4,272,721)	(8,150,892)
Cash and cash equivalents at beginning of period	14,155,809	24,196,691
Cash and cash equivalents at end of period	9,883,088	16,045,799
Supplemental disclosure of cash flow information
Interest paid	$ 104,500	$ 58,790

Organization and Basis of Prese

Organization and Basis of Presentation	6 Months Ended
	Jun. 30, 2015
Organization Consolidation And Presentation Of Financial Statements [Abstract]
Organization and Basis of Presentation	1. Organization and Basis of Presentation Evoke Pharma, Inc. (the “Company”) was incorporated in the state of Delaware on January 29, 2007. The Company is a publicly-held specialty pharmaceutical company focused primarily on the development of drugs to treat gastroenterological disorders and disease. Since its inception, the Company has devoted substantially all of its efforts to product development, raising capital and building infrastructure, and has not realized revenues from its planned principal operations. The Company does not anticipate realizing revenues for the foreseeable future. The Company’s activities are subject to significant risks and uncertainties, including funding its operations beyond the completion of its ongoing Phase 3 clinical trial for EVK-001. The Company expects to continue to incur net losses for at least the next several years. Over that period, the Company will need to raise additional debt or equity financing to fund its development. If the Company is not able to secure adequate additional funding, the Company may be forced to make reductions in spending, extend payment terms with suppliers, and/or suspend or curtail planned programs. Any of these actions could materially harm the Company’s business, results of operations, financial condition and future prospects.

Summary of Significant Accounti

Summary of Significant Accounting Policies	6 Months Ended
	Jun. 30, 2015
Accounting Policies [Abstract]
Summary of Significant Accounting Policies	2. Summary of Significant Accounting Policies The accompanying condensed balance sheet as of December 31, 2014, which has been derived from audited financial statements, and the unaudited interim condensed financial statements, have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and follow the requirements of the U.S. Securities and Exchange Commission (“SEC”) for interim reporting. As permitted under those rules, certain footnotes or other financial information that are normally required by GAAP can be condensed or omitted. In management’s opinion, the unaudited interim financial statements have been prepared on the same basis as the audited financial statements and include all adjustments, which include only normal recurring adjustments, necessary for the fair presentation of the Company’s financial position and its results of operations and its cash flows for the periods presented. These statements do not include all disclosures required by GAAP and should be read in conjunction with the Company’s financial statements and accompanying notes for the fiscal year ended December 31, 2014, which are contained in the Company’s Annual Report on Form 10-K filed with the SEC on March 4, 2015. In its report on the Company’s financial statements for the year ended December 31, 2014, the Company’s independent registered public accounting firm included an explanatory paragraph expressing substantial doubt regarding the Company’s ability to continue as a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The results for interim periods are not necessarily indicative of the results expected for the full fiscal year or any other interim period. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Actual results could differ materially from those estimates. Stock-Based Compensation Stock-based compensation expense for stock option grants and employee stock purchases under the Company’s Employee Stock Purchase Plan (the “ESPP”) is recorded at the estimated fair value of the award as of the grant date and is recognized as expense on a straight-line basis over the employee’s requisite service period. The estimation of stock option and ESPP fair value requires management to make estimates and judgments about, among other things, employee exercise behavior, forfeiture rates and volatility of the Company’s common stock. The judgments directly affect the amount of compensation expense that will be recognized. Prior to the Company’s initial public offering (“IPO”) in September 2013, the Company granted stock options to purchase common stock to employees with exercise prices equal to the estimated fair value of the underlying stock, as determined by the board of directors on the date the equity award was granted. The board of directors determined the fair value of the underlying common stock by considering a number of factors, including historical and projected financial results, the risks the Company faced at the time, the preferences of the Company’s preferred stockholders and the lack of liquidity of the Company’s common stock. Subsequent to the IPO, the exercise price of the stock options granted to employees and members of the board of directors of the Company was determined by the Company’s closing market price on the date the stock options were granted. The risk-free interest rate assumption was based on the yield of an applicable rate for U.S. Treasury instruments with maturities similar to those of the expected term of the award being valued. The weighted average expected term of options and employee stock purchases was calculated using the simplified method as prescribed by accounting guidance for stock-based compensation. This decision was based on the lack of relevant historical data due to the Company’s limited historical experience. In addition, due to the Company’s limited historical data, the estimated volatility was calculated based upon the Company’s historical volatility, supplemented as necessary with historical volatility of comparable companies in the biotechnology industry whose share prices are publicly available for a sufficient period of time. The assumed dividend yield was based on the Company never paying cash dividends and having no expectation of paying cash dividends in the foreseeable future. Research and Development Expenses Research and development costs are expensed as incurred and primarily include compensation and related benefits, stock-based compensation expense and costs paid to third-party contractors to perform research, conduct clinical trials and develop drug materials and delivery devices. The Company expenses costs relating to the purchase and production of pre-approval inventories as research and development expense in the period incurred until U.S. Food and Drug Administration (“FDA”) approval is received. The Company bases its expense accruals related to clinical studies on estimates of the services received and efforts expended pursuant to contracts with multiple research institutions and contract research organizations (“CROs”) that conduct and manage clinical studies on its behalf. The financial terms of these agreements vary from contract to contract and may result in uneven payment flows. Payments under some of these contracts depend on factors, such as the successful enrollment of patients, site initiation and the completion of clinical study milestones. Service providers typically invoice the Company monthly in arrears for services performed. In accruing service fees, the Company estimates the time period over which services will be performed and the level of effort to be expended in each period. If the Company does not identify costs that have begun to be incurred, or if the Company underestimates or overestimates the level of services performed or the costs of these services, actual expenses could differ materially from estimates. To date, the Company has not experienced significant changes in estimates of accrued research and development expenses after a reporting period. However, due to the nature of estimates, no assurance can be made that changes to the estimates will not be made in the future as the Company becomes aware of additional information about the status or conduct of clinical studies and other research activities. Included in research and development expenses were costs of $71,019 and $28,274 for the three months ended June 30, 2015 and 2014, respectively, and $159,044 and $28,274 for the six months ended June 30, 2015 and 2014, respectively, incurred by a related party of one of the Company’s officers who serves on the executive management team of a CRO that provides clinical trial services to the Company. The Company does not own or operate manufacturing facilities for the production of EVK-001, nor does it plan to develop its own manufacturing operations in the foreseeable future. The Company currently depends on third-party contract manufacturers for all of its required raw materials, drug substance and finished product for its preclinical research and clinical trials. The Company does not have any current contractual relationships for the manufacture of commercial supplies of EVK-001. If EVK-001 is approved by any regulatory agency, the Company intends to enter into agreements with third-party contract manufacturers for the commercial production at that time. The Company currently utilizes a third-party consultant, which it engages on an as-needed, hourly basis, to manage its manufacturing contractors. Net Loss Per Share Basic net loss per share is calculated by dividing the net loss by the weighted-average number of common shares outstanding for the period, without consideration for common stock equivalents and adjusted for the weighted-average number of common shares outstanding that are subject to repurchase. The Company has excluded 45,000 and 71,875 weighted-average shares subject to repurchase from the weighted-average number of common shares outstanding for the three months ended June 30, 2015 and 2014, respectively. In addition, the Company has excluded 45,000 and 83,125 weighted-average shares subject to repurchase from the weighted-average number of common shares outstanding for the six months ended June 30, 2015 and 2014, respectively. Diluted net loss per share is calculated by dividing the net loss by the weighted-average number of common share equivalents outstanding for the period determined using the treasury-stock method. Dilutive common stock equivalents are comprised of warrants for the purchase of common stock, options outstanding under the Company’s equity incentive plans and potential shares to be purchased under the ESPP. For the periods presented, there is no difference in the number of shares used to calculate basic and diluted shares outstanding due to the Company’s net loss position. The following table sets forth the outstanding potentially dilutive securities that have been excluded from the calculation of diluted net loss per share because to do so would be anti-dilutive: Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Warrants to purchase common stock 118,881 96,000 118,881 96,000 Common stock options 1,037,500 688,750 1,037,500 688,750 Employee stock purchase plan 7,208 4,021 10,529 5,362 Total excluded securities 1,163,589 788,771 1,166,910 790,112 Recent Accounting Pronouncements In April 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update 2015-03, Interest – Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs During the quarter ended June 30, 2015, there were no other new accounting pronouncements or updates to recently issued accounting pronouncements disclosed in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2014 that affect the Company’s results of operations, financial condition, liquidity or disclosures.

Debt

Debt	6 Months Ended
	Jun. 30, 2015
Debt Disclosure [Abstract]
Debt	3. Debt In June 2012, the Company entered into a $3.0 million loan and security agreement with Silicon Valley Bank (“SVB”), collateralized by the Company’s personal property. The agreement also contained non-financial covenants. By January 2013, the Company had been advanced the entire $3.0 million. Interest on advances under the agreement was at a fixed interest rate equal to 4.50%. Advances under the loan and security agreement had an interest-only period through December 31, 2013, and had a 24-month payback period that commenced in January 2014. Through May 1, 2014, the Company repaid approximately $603,000 of principal on the SVB loan. On May 23, 2014, the Company repaid the remaining outstanding principal and accrued interest of approximately $2.4 million to SVB. In addition, the Company expensed approximately $38,000 of unamortized debt discount costs upon the repayment of the loan. With such payoff, the SVB loan agreement and the documents entered into in connection therewith were deemed to be terminated. SVB’s security interest in substantially all of the Company’s assets was also terminated. On May 28, 2014 (the “closing date”), the Company entered into a $4.5 million loan and security agreement (the “credit facility”) with Square 1 Bank (“Square 1”), pursuant to which Square 1 agreed to make term loans available to the Company for general corporate and working capital purposes and for capital expenditures. In December 2014, the Company drew down the entire $4.5 million. The credit facility bears interest at a fixed annual rate of 5.50%. The Company is required to make interest-only payments through November 28, 2015 on the credit facility. The outstanding principal balance plus interest will begin amortizing at the end of the interest-only period, with monthly payments of principal and interest being made by the Company to Square 1 in consecutive monthly installments following November 28, 2015 until the credit facility matures on November 28, 2017. At the Company’s option, it may prepay the outstanding principal balance of the credit facility before November 28, 2017 without penalty or premium. The credit facility includes affirmative and negative covenants applicable to the Company and any subsidiaries it creates in the future. The affirmative covenants include, among others, covenants requiring the Company to maintain its legal existence and governmental approvals, deliver certain financial reports, maintain insurance coverage and meet certain covenants with respect to enrollment and results of its EVK-001 Phase 3 trial. After the Company receives positive results (which must be achieved on or prior to March 1, 2016) from the Phase 3 trial, if at all, it must either maintain a ratio of its cash at Square 1 to its cash burn over the preceding month of at least 3.00 to 1.00, or it must deliver evidence of a forthcoming financing or strategic partnership arrangement to Square 1, in each case in an amount satisfactory to Square 1. The negative covenants include, among others, restrictions on the Company transferring collateral, incurring additional indebtedness, engaging in mergers or acquisitions, paying dividends or making other distributions, making investments, creating liens and selling assets, in each case subject to certain exceptions. The credit facility also includes events of default, the occurrence and continuation of which provide Square 1 with the right to exercise remedies against the Company and the collateral securing the term loans under the credit facility, including foreclosure against the Company’s properties securing the credit facilities, including its cash. These events of default include, among other things, the Company’s failure to pay any amounts due under the credit facility, a breach of covenants under the credit facility, the Company’s insolvency, a material adverse change, the occurrence of any default under certain other indebtedness in an amount greater than $400,000 and a final judgment against the Company in an amount greater than $400,000. In connection with the funding of the term loan, the Company issued to Square 1 a warrant to purchase 22,881 shares of the Company’s common stock at an exercise price of $5.90 per share, the closing price of the Company’s common stock on the day of funding of the credit facility. The warrant expires on December 31, 2024. If the warrant has not been exercised prior to its expiration date, it will be deemed to automatically convert by “cashless” conversion. In the event that the Company is acquired, the warrant will be exercisable or deemed automatically converted, which shall be determined based upon whether the Company’s successor assumes the obligations of the warrant. The estimated fair value of the warrant issued to Square 1 was determined on the date of issuance using the Black-Scholes option-pricing valuation model with the following assumptions: Risk free interest rate 2.17% Expected warrant term 10 Years Expected volatility of common stock 77.19% Expected dividend yield 0.0% The value determined for the warrant of $108,122 has been recorded as a debt discount, as well as to stockholders’ equity. The debt discount is being amortized to interest expense over the remaining term of the loan. The Company incurred $82,685 of loan origination costs related to this credit facility. Such costs are being amortized to interest expense over the 42 month term of the credit facility.

Technology Acquisition Agreemen

Technology Acquisition Agreement	6 Months Ended
	Jun. 30, 2015
Technology Acquisition Agreement [Abstract]
Technology Acquisition Agreement	4. Technology Acquisition Agreement In June 2007, the Company acquired all worldwide rights, data, patents and other related assets associated with EVK-001 from Questcor Pharmaceuticals, Inc. (“Questcor”) pursuant to an Asset Purchase Agreement. The Company paid Questcor $650,000 in the form of an upfront payment and $500,000 in May 2014 as a milestone payment based upon the initiation of the first patient dosing in the Company’s Phase 3 clinical trial for EVK-001. In August 2014, Mallinckrodt, plc (“Mallinckrodt”) acquired Questcor. As a result of that acquisition, Questcor transferred its rights included in the Asset Purchase Agreement with the Company to Mallinckrodt. In addition to the payments made to Questcor, the Company may also be required to make additional milestone payments totaling up to $51.5 million. These milestones include up to $4.5 million in payments if EVK-001 achieves the following development targets: · $1.5 million upon the FDA’s acceptance for review of a new drug application for EVK-001; and · $3.0 million upon the FDA’s approval of EVK-001. The remaining $47.0 million in milestone payments depend on EVK-001’s commercial success and will only apply if EVK-001 receives regulatory approval. In addition, the Company will be required to pay to Mallinckrodt a low single digit royalty on net sales of EVK-001. The Company’s obligation to pay such royalties will terminate upon the expiration of the last patent right covering EVK-001, which is expected to occur in 2030.

Stockholders' Equity

Stockholders' Equity	6 Months Ended
	Jun. 30, 2015
Equity [Abstract]
Stockholders' Equity	5. Stockholders’ Equity On November 13, 2014, the Company entered into an At Market Sales Agreement (“Sales Agreement”) with MLV & Co. LLC (“MLV”), pursuant to which the Company may sell from time to time, at its option, up to an aggregate of $6.6 million worth of shares of common stock through MLV as sales agent. The sales of shares of the Company’s common stock made through this equity program are made in “at-the-market” offerings as defined in Rule 415 of the Securities Act of 1933, as amended. During the six months ended June 30, 2015, the Company sold 170,751 shares of common stock at a weighted average price per share of $6.99 pursuant to the Sales Agreement and received proceeds of approximately $1.2 million, net of commissions and fees. During July 2015, the Company sold an additional 32,672 shares of common stock at a weighted average price per share of $6.17 pursuant to the Sales Agreement and received proceeds of approximately $195,000, net of commissions and fees. The Company incurred approximately $138,000 of legal, accounting and filing fees related to its Registration Statement on Form S-3 filed in November 2014. Such costs were capitalized and included in other current assets at December 31, 2014, and were reclassified to additional paid-in capital during the first quarter of 2015 as a further offset to the net proceeds. The Company intends to use the net proceeds to continue to fund its ongoing Phase 3 clinical trial and for general corporate purposes. Future sales will depend on a variety of factors including, but not limited to, market conditions, the trading price of the Company’s common stock and the Company’s capital needs. Although sales of the Company’s common stock have taken place pursuant to the Sales Agreement, there can be no assurance that MLV will be successful in consummating future sales based on prevailing market conditions or in the quantities or at the prices that the Company deems appropriate. Under current SEC regulations, at any time during which the aggregate market value of the Company’s common stock held by non-affiliates, or public float, is less than $75 million, the amount the Company can raise through primary public offerings of securities in any twelve-month period using shelf registration statements, including sales under the Sales Agreement, is limited to an aggregate of one-third of the Company’s public float. As of November 11, 2014, the Company’s public float was 2.9 million shares, the value of which was $20.0 million based upon the closing price of the Company’s common stock of $6.86 on such date. The value of one-third of the Company’s public float calculated on the same basis was $6.6 million. As of July 31, 2015, the Company has the capacity to issue up to approximately $5.2 million worth of additional shares of common stock pursuant to the Sales Agreement. In addition, the Company will not be able to make future sales of common stock pursuant to the Sales Agreement unless certain conditions are met, which include the accuracy of representations and warranties made to MLV under the Sales Agreement. Furthermore, MLV is permitted to terminate the Sales Agreement in its sole discretion upon ten days’ notice, or at any time in certain circumstances, including the occurrence of an event that would be reasonably likely to have a material adverse effect on the Company’s assets, business, operations, earnings, properties, condition (financial or otherwise), prospects, stockholders’ equity or results of operations. The Company has no obligation to sell the remaining shares available for sale pursuant to the Sales Agreement. As a result of payroll withholdings from the Company’s employees of approximately $111,000, the Company also sold 23,288 shares of common stock through its ESPP during the six months ended June 30, 2015. Stock-Based Compensation Stock-based compensation expense includes charges related to stock option grants and employee stock purchases under the ESPP. The Company measures stock-based compensation expense based on the grant date fair value of any awards granted to its employees. Such expense is recognized over the period of time that employees provide service and earn rights to the awards. The estimated fair value of each stock option award granted was determined on the date of grant using the Black-Scholes option-pricing valuation model with the following weighted-average assumptions for option grants during the three and six months ended June 30, 2015 and 2014: Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Common Stock Options Risk free interest rate 1.50% 1.66% 1.50%-1.87% 1.66% - 1.77% Expected option term 5.5 years 5.5 years 5.5-6.0 years 5.5 - 6.0 years Expected volatility of common stock 76.74% 71.06% 71.99%-76.74% 71.06% - 73.21% Expected dividend yield 0.0% 0.0% 0.0% 0.0% The estimated fair value of each ESPP award was determined on the date of grant using the Black-Scholes option-pricing valuation model with the following weighted-average assumptions for option grants during the six months ended June 30, 2015 and 2014. Three and Six Months Ended June 30, 2015 2014 Employee Stock Purchase Plan Risk free interest rate 0.08% 0.08% Expected option term 6 months 6 months Expected volatility of common stock 62.91% 73.21% Expected dividend yield 0.0% 0.0% The Company recognized non-cash stock-based compensation expense to employees and directors in its research and development and its general and administrative functions as follows: Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Research and development $ 145,509 $ 104,759 $ 288,533 $ 197,424 General and administrative 239,029 160,451 467,605 291,096 Total stock-based compensation expense $ 384,538 $ 265,210 $ 756,138 $ 488,520 As of June 30, 2015, there were approximately $3.0 million of unrecognized compensation costs related to outstanding employee and board of director options, which are expected to be recognized over a weighted average period of 1.32 years.

Summary of Significant Accoun11

Summary of Significant Accounting Policies (Policies)	6 Months Ended
	Jun. 30, 2015
Accounting Policies [Abstract]
Use of Estimates	Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Actual results could differ materially from those estimates.
Stock-Based Compensation	Stock-Based Compensation Stock-based compensation expense for stock option grants and employee stock purchases under the Company’s Employee Stock Purchase Plan (the “ESPP”) is recorded at the estimated fair value of the award as of the grant date and is recognized as expense on a straight-line basis over the employee’s requisite service period. The estimation of stock option and ESPP fair value requires management to make estimates and judgments about, among other things, employee exercise behavior, forfeiture rates and volatility of the Company’s common stock. The judgments directly affect the amount of compensation expense that will be recognized. Prior to the Company’s initial public offering (“IPO”) in September 2013, the Company granted stock options to purchase common stock to employees with exercise prices equal to the estimated fair value of the underlying stock, as determined by the board of directors on the date the equity award was granted. The board of directors determined the fair value of the underlying common stock by considering a number of factors, including historical and projected financial results, the risks the Company faced at the time, the preferences of the Company’s preferred stockholders and the lack of liquidity of the Company’s common stock. Subsequent to the IPO, the exercise price of the stock options granted to employees and members of the board of directors of the Company was determined by the Company’s closing market price on the date the stock options were granted. The risk-free interest rate assumption was based on the yield of an applicable rate for U.S. Treasury instruments with maturities similar to those of the expected term of the award being valued. The weighted average expected term of options and employee stock purchases was calculated using the simplified method as prescribed by accounting guidance for stock-based compensation. This decision was based on the lack of relevant historical data due to the Company’s limited historical experience. In addition, due to the Company’s limited historical data, the estimated volatility was calculated based upon the Company’s historical volatility, supplemented as necessary with historical volatility of comparable companies in the biotechnology industry whose share prices are publicly available for a sufficient period of time. The assumed dividend yield was based on the Company never paying cash dividends and having no expectation of paying cash dividends in the foreseeable future.
Research and Development Expenses	Research and Development Expenses Research and development costs are expensed as incurred and primarily include compensation and related benefits, stock-based compensation expense and costs paid to third-party contractors to perform research, conduct clinical trials and develop drug materials and delivery devices. The Company expenses costs relating to the purchase and production of pre-approval inventories as research and development expense in the period incurred until U.S. Food and Drug Administration (“FDA”) approval is received. The Company bases its expense accruals related to clinical studies on estimates of the services received and efforts expended pursuant to contracts with multiple research institutions and contract research organizations (“CROs”) that conduct and manage clinical studies on its behalf. The financial terms of these agreements vary from contract to contract and may result in uneven payment flows. Payments under some of these contracts depend on factors, such as the successful enrollment of patients, site initiation and the completion of clinical study milestones. Service providers typically invoice the Company monthly in arrears for services performed. In accruing service fees, the Company estimates the time period over which services will be performed and the level of effort to be expended in each period. If the Company does not identify costs that have begun to be incurred, or if the Company underestimates or overestimates the level of services performed or the costs of these services, actual expenses could differ materially from estimates. To date, the Company has not experienced significant changes in estimates of accrued research and development expenses after a reporting period. However, due to the nature of estimates, no assurance can be made that changes to the estimates will not be made in the future as the Company becomes aware of additional information about the status or conduct of clinical studies and other research activities. Included in research and development expenses were costs of $71,019 and $28,274 for the three months ended June 30, 2015 and 2014, respectively, and $159,044 and $28,274 for the six months ended June 30, 2015 and 2014, respectively, incurred by a related party of one of the Company’s officers who serves on the executive management team of a CRO that provides clinical trial services to the Company. The Company does not own or operate manufacturing facilities for the production of EVK-001, nor does it plan to develop its own manufacturing operations in the foreseeable future. The Company currently depends on third-party contract manufacturers for all of its required raw materials, drug substance and finished product for its preclinical research and clinical trials. The Company does not have any current contractual relationships for the manufacture of commercial supplies of EVK-001. If EVK-001 is approved by any regulatory agency, the Company intends to enter into agreements with third-party contract manufacturers for the commercial production at that time. The Company currently utilizes a third-party consultant, which it engages on an as-needed, hourly basis, to manage its manufacturing contractors.
Net Loss Per Share	Net Loss Per Share Basic net loss per share is calculated by dividing the net loss by the weighted-average number of common shares outstanding for the period, without consideration for common stock equivalents and adjusted for the weighted-average number of common shares outstanding that are subject to repurchase. The Company has excluded 45,000 and 71,875 weighted-average shares subject to repurchase from the weighted-average number of common shares outstanding for the three months ended June 30, 2015 and 2014, respectively. In addition, the Company has excluded 45,000 and 83,125 weighted-average shares subject to repurchase from the weighted-average number of common shares outstanding for the six months ended June 30, 2015 and 2014, respectively. Diluted net loss per share is calculated by dividing the net loss by the weighted-average number of common share equivalents outstanding for the period determined using the treasury-stock method. Dilutive common stock equivalents are comprised of warrants for the purchase of common stock, options outstanding under the Company’s equity incentive plans and potential shares to be purchased under the ESPP. For the periods presented, there is no difference in the number of shares used to calculate basic and diluted shares outstanding due to the Company’s net loss position. The following table sets forth the outstanding potentially dilutive securities that have been excluded from the calculation of diluted net loss per share because to do so would be anti-dilutive: Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Warrants to purchase common stock 118,881 96,000 118,881 96,000 Common stock options 1,037,500 688,750 1,037,500 688,750 Employee stock purchase plan 7,208 4,021 10,529 5,362 Total excluded securities 1,163,589 788,771 1,166,910 790,112
Recent Accounting Pronouncements	Recent Accounting Pronouncements In April 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update 2015-03, Interest – Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs During the quarter ended June 30, 2015, there were no other new accounting pronouncements or updates to recently issued accounting pronouncements disclosed in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2014 that affect the Company’s results of operations, financial condition, liquidity or disclosures.

Summary of Significant Accoun12

Summary of Significant Accounting Policies (Tables)	6 Months Ended
	Jun. 30, 2015
Accounting Policies [Abstract]
Summary of Outstanding Potentially Dilutive Securities Excluded from Calculation of Diluted Net Loss Per Share	The following table sets forth the outstanding potentially dilutive securities that have been excluded from the calculation of diluted net loss per share because to do so would be anti-dilutive: Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Warrants to purchase common stock 118,881 96,000 118,881 96,000 Common stock options 1,037,500 688,750 1,037,500 688,750 Employee stock purchase plan 7,208 4,021 10,529 5,362 Total excluded securities 1,163,589 788,771 1,166,910 790,112

Debt (Tables)

Debt (Tables)	6 Months Ended
	Jun. 30, 2015
Debt Disclosure [Abstract]
Assumptions Used in Estimation of Initial Fair Value of Warrants	The estimated fair value of the warrant issued to Square 1 was determined on the date of issuance using the Black-Scholes option-pricing valuation model with the following assumptions: Risk free interest rate 2.17% Expected warrant term 10 Years Expected volatility of common stock 77.19% Expected dividend yield 0.0%

Stockholders' Equity (Tables)

Stockholders' Equity (Tables)	6 Months Ended
	Jun. 30, 2015
Equity [Abstract]
Summary of Estimated Fair Value of Stock Option Award	The estimated fair value of each stock option award granted was determined on the date of grant using the Black-Scholes option-pricing valuation model with the following weighted-average assumptions for option grants during the three and six months ended June 30, 2015 and 2014: Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Common Stock Options Risk free interest rate 1.50% 1.66% 1.50%-1.87% 1.66% - 1.77% Expected option term 5.5 years 5.5 years 5.5-6.0 years 5.5 - 6.0 years Expected volatility of common stock 76.74% 71.06% 71.99%-76.74% 71.06% - 73.21% Expected dividend yield 0.0% 0.0% 0.0% 0.0%
Summary of Estimated Fair Value of Employee Stock Purchase Plan Award	The estimated fair value of each ESPP award was determined on the date of grant using the Black-Scholes option-pricing valuation model with the following weighted-average assumptions for option grants during the six months ended June 30, 2015 and 2014. Three and Six Months Ended June 30, 2015 2014 Employee Stock Purchase Plan Risk free interest rate 0.08% 0.08% Expected option term 6 months 6 months Expected volatility of common stock 62.91% 73.21% Expected dividend yield 0.0% 0.0%
Summary of Recognized Non-Cash Stock-Based Compensation Expense	The Company recognized non-cash stock-based compensation expense to employees and directors in its research and development and its general and administrative functions as follows: Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Research and development $ 145,509 $ 104,759 $ 288,533 $ 197,424 General and administrative 239,029 160,451 467,605 291,096 Total stock-based compensation expense $ 384,538 $ 265,210 $ 756,138 $ 488,520

Organization and Basis of Pre15

Organization and Basis of Presentation - Additional Information (Detail)	6 Months Ended
	Jun. 30, 2015
Organization Consolidation And Presentation Of Financial Statements [Abstract]
Date of incorporation	Jan. 29, 2007

Summary of Significant Accoun16

Summary of Significant Accounting Policies - Additional Information (Detail) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014	Dec. 31, 2014
Significant Accounting Policies [Line Items]
Weighted-average shares subject to repurchase excluded from the weighted-average number of common shares outstanding	45,000	71,875	45,000	83,125
Current portion of long-term debt	$ 1,251,806		$ 1,251,806		$ 126,806
Long-term debt, net of current portion	3,101,770		3,101,770		4,196,422
Imputation of Interest [Member]
Significant Accounting Policies [Line Items]
Current portion of long-term debt					23,624
Long-term debt, net of current portion					$ 45,026
Officers [Member] | Clinical Trial Services [Member]
Significant Accounting Policies [Line Items]
Related Party expenses	$ 71,019	$ 28,274	$ 159,044	$ 28,274

Summary of Significant Accoun17

Summary of Significant Accounting Policies - Summary of Outstanding Potentially Dilutive Securities Excluded from Calculation of Diluted Net Loss Per Share (Detail) - shares	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Total excluded securities	1,163,589	788,771	1,166,910	790,112
Warrants to purchase common stock [Member]
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Total excluded securities	118,881	96,000	118,881	96,000
Common stock options [Member]
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Total excluded securities	1,037,500	688,750	1,037,500	688,750
Employee stock purchase plan [Member]
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Total excluded securities	7,208	4,021	10,529	5,362

Debt - Additional Information (

Debt - Additional Information (Detail) - USD ($)	May. 28, 2014	May. 23, 2014	May. 01, 2014	Jun. 30, 2012	Jun. 30, 2015	Jun. 30, 2014	Dec. 31, 2014	Jan. 31, 2013
Debt Instrument [Line Items]
Repayment of principal and accrued interest						$ 3,000,000
Warrant value recorded in equity							$ 108,122
Line of credit facility, loan origination cost						$ 82,685
Warrant [Member]
Debt Instrument [Line Items]
Debt Instrument, Unamortized Discount							108,122
Silicon Valley Bank [Member]
Debt Instrument [Line Items]
Repayment of principal amount			$ 603,000
Silicon Valley Bank [Member] | Loan and security agreement [Member]
Debt Instrument [Line Items]
Loan and security agreement, maximum credit				$ 3,000,000
Loan and security agreement, amount drawn								$ 3,000,000
Loan and security agreement, interest rate				4.50%
Loan and security agreement, payback period				24 months
Repayment of principal and accrued interest		$ 2,400,000
Debt Instrument, Unamortized Discount		$ 38,000
Square 1 Bank [Member] | Maximum [Member]
Debt Instrument [Line Items]
Cash burn under credit facility					3
Square 1 Bank [Member] | Minimum [Member]
Debt Instrument [Line Items]
Cash burn under credit facility					1
Square 1 Bank [Member] | Loan and security agreement [Member]
Debt Instrument [Line Items]
Loan and security agreement, amount drawn							$ 4,500,000
Loan and security agreement, available credit	$ 4,500,000
Fixed interest rate							5.50%
Loan and security agreement, amount of other indebtedness	400,000
Warrants exercisable, stock issued							22,881
Warrant exercise price per share							$ 5.90
Warrant expiration date					Dec. 31, 2024
Line of credit facility, loan origination cost	$ 82,685
Loan and security agreement, Amortization period	42 months

Debt - Assumptions Used in Esti

Debt - Assumptions Used in Estimation of Initial Fair Value of Warrants (Detail) - 6 months ended Jun. 30, 2015	Total
Debt Disclosure [Abstract]
Risk free interest rate	2.17%
Expected warrant term	10 years
Expected volatility of common stock	77.19%
Expected dividend yield	0.00%

Technology Acquisition Agreem20

Technology Acquisition Agreement - Additional Information (Detail) - USD ($)	1 Months Ended		6 Months Ended
	May. 31, 2014	Jun. 30, 2007	Jun. 30, 2015
Technology Acquisition Agreement [Line Items]
Payment expensed as in-process research and development		$ 650,000
Mallinckrodt Plc [Member] | Patented Technology
Technology Acquisition Agreement [Line Items]
Expected expiration of patent right			2,030
Mallinckrodt Plc [Member] | Rights and Patents Acquired from Questcor Pharmaceuticals Inc [Member] | Maximum [Member]
Technology Acquisition Agreement [Line Items]
Milestone payments contingent amount			$ 51,500,000
Development Target One [Member] | Rights and Patents Acquired from Questcor Pharmaceuticals Inc [Member]
Technology Acquisition Agreement [Line Items]
Milestone payment	$ 500,000
Development targets description			Upon the initiation of the first patient dosing in the Company’s Phase 3 clinical trial for EVK-001
Development Target Two And Three [Member] | Mallinckrodt Plc [Member] | Maximum [Member]
Technology Acquisition Agreement [Line Items]
Milestone payments contingent amount			$ 4,500,000
Development Target Two [Member] | Mallinckrodt Plc [Member]
Technology Acquisition Agreement [Line Items]
Development targets description			Upon the FDA’s acceptance for review of a new drug application for EVK-001
Milestone payments contingent amount			$ 1,500,000
Development Target Three [Member] | Mallinckrodt Plc [Member]
Technology Acquisition Agreement [Line Items]
Development targets description			Upon the FDA’s approval of EVK-001
Milestone payments contingent amount			$ 3,000,000
Development Target Four [Member] | Mallinckrodt Plc [Member] | Patented Technology
Technology Acquisition Agreement [Line Items]
Development targets description			Depend on EVK-001’s commercial success and will only apply if EVK-001 receives regulatory approval. In addition, the Company will be required to pay to Mallinckrodt a low single digit royalty on net sales of EVK-001.
Milestone payments contingent amount			$ 47,000,000

Stockholders' Equity - Addition

Stockholders' Equity - Additional Information (Detail) - USD ($)	1 Months Ended	6 Months Ended
	Jul. 31, 2015	Jun. 30, 2015	Dec. 31, 2014	Nov. 13, 2014	Nov. 11, 2014
Sale Of Stock [Line Items]
Common stock, shares issued		6,306,130	6,112,091
Proceeds from issuance of common stock, net		$ 1,266,533
Legal, Accounting and Filing Fees		$ 138,000
Common stock, shares outstanding		6,306,130	6,112,091
Payroll withholdings from employees		$ 111,000
Common stock for Employment Stock Purchase Plan		23,288
Unrecognized compensation costs		$ 3,000,000
Weighted average period		1 year 3 months 26 days
Sales Agreement with MLV & Co. LLC [Member]
Sale Of Stock [Line Items]
Common stock, value of shares issuable				$ 6,600,000
Common stock, shares issued		170,751
Common stock , weighted average price per share		$ 6.99
Proceeds from issuance of common stock, net		$ 1,200,000
Common stock, shares outstanding					2,900,000
Entity public float					$ 20,000,000
Common stock, closing price					$ 6.86
One third value of entity public float					$ 6,600,000
Sales Agreement with MLV & Co. LLC [Member] | Subsequent Event [Member]
Sale Of Stock [Line Items]
Common stock, value of shares issuable	$ 5,200,000
Common stock, shares issued	32,672
Common stock , weighted average price per share	$ 6.17
Proceeds from issuance of common stock, net	$ 195,000

Stockholders' Equity - Summary

Stockholders' Equity - Summary of Estimated Fair Value of Stock Option Award (Detail) - Common stock options [Member]	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Stock-based Compensation Arrangement by Share-based Payment Award [Line Items]
Risk free interest rate	1.50%	1.66%
Expected option term	5 years 6 months	5 years 6 months
Expected volatility of common stock	76.74%	71.06%
Expected dividend yield	0.00%	0.00%	0.00%	0.00%
Minimum [Member]
Stock-based Compensation Arrangement by Share-based Payment Award [Line Items]
Risk free interest rate			1.50%	1.66%
Expected option term			5 years 6 months	5 years 6 months
Expected volatility of common stock			71.99%	71.06%
Maximum [Member]
Stock-based Compensation Arrangement by Share-based Payment Award [Line Items]
Risk free interest rate			1.87%	1.77%
Expected option term			6 years	6 years
Expected volatility of common stock			76.74%	73.21%

Stockholders' Equity -Summary o

Stockholders' Equity -Summary of Estimated Fair Value of Employee Stock Purchase Plan Award (Detail) - Employee stock purchase plan [Member]	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Stock-based Compensation Arrangement by Share-based Payment Award [Line Items]
Risk free interest rate	0.08%	0.08%	0.08%	0.08%
Expected option term	6 months	6 months	6 months	6 months
Expected volatility of common stock	62.91%	73.21%	62.91%	73.21%
Expected dividend yield	0.00%	0.00%	0.00%	0.00%

Stockholders' Equity - Summar24

Stockholders' Equity - Summary of Recognized Non-Cash Stock-Based Compensation Expense (Detail) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation expense	$ 384,538	$ 265,210	$ 756,138	$ 488,520
Research and development [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation expense	145,509	104,759	288,533	197,424
General and administrative [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation expense	$ 239,029	$ 160,451	$ 467,605	$ 291,096