Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2022 | May 13, 2022 | |
Document and Entity Information | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Mar. 31, 2022 | |
Entity File Number | 001-35994 | |
Entity Registrant Name | NightHawk Biosciences, Inc. | |
Entity Incorporation | DE | |
Entity Tax Identification Number | 26-2844103 | |
Entity Address, Address Line One | 627 Davis Drive, Suite 400 | |
Entity Address, City or Town | Morrisville | |
Entity Address, State or Province | NC | |
Entity Address, Postal Zip Code | 27560 | |
City Area Code | 919 | |
Local Phone Number | 240-7133 | |
Title of 12(b) Security | Common Stock | |
Trading Symbol | NHWK | |
Security Exchange Name | NYSEAMER | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 25,649,824 | |
Entity Central Index Key | 0001476963 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 |
Current Assets | ||
Cash and cash equivalents | $ 14,584,715 | $ 8,053,879 |
Short-term investments | 69,528,419 | 88,324,922 |
Accounts receivable | 99,705 | 66,049 |
Prepaid expenses and other current assets | 2,364,918 | 2,886,520 |
Total Current Assets | 86,577,757 | 99,331,370 |
Property and Equipment, net | 3,098,665 | 2,158,479 |
Other Assets. | ||
In-process R&D | 3,500,000 | 3,500,000 |
Grant receivable | 1,524,522 | 1,318,359 |
Operating lease right-of-use asset | 1,954,205 | 1,782,884 |
Finance lease right-of-use asset | 407,839 | 470,700 |
Other assets | 16,995,227 | 12,193,540 |
Deposits | 208,307 | 205,901 |
Total Other Assets | 24,590,100 | 19,471,384 |
Total Assets | 114,266,522 | 120,961,233 |
Current Liabilities | ||
Accounts payable | 2,228,192 | 922,782 |
Operating lease liability, current portion | 420,460 | 350,343 |
Finance lease liability, current portion | 244,163 | 260,574 |
Accrued expenses and other liabilities | 1,644,200 | 2,419,676 |
Contingent consideration, current portion | 600,866 | 593,037 |
Contingent consideration, related party - current portion | 176,634 | 174,333 |
Total Current Liabilities | 5,314,515 | 4,720,745 |
Long Term Liabilities | ||
Other long-term liabilities | 55,080 | 53,530 |
Derivative warrant liability | 3,241 | 11,020 |
Deferred tax liability | 215,937 | 215,937 |
Deferred revenue, net of current portion | 35,000 | 35,000 |
Operating lease liability, net of current portion | 1,183,597 | 1,060,856 |
Financing lease liability, net of current portion | 216,649 | 255,429 |
Contingent consideration | 1,966,060 | 1,990,118 |
Contingent consideration, related party | 577,955 | 585,027 |
Total Liabilities | 9,568,034 | 8,927,662 |
Commitments and Contingencies | ||
Stockholders' Equity | ||
Common stock, $.0002 par value; 250,000,000 and 250,000,000 shares authorized, 25,649,824 and 25,649,824 shares issued and outstanding at March 31, 2022 and December 31, 2021 | 5,120 | 5,055 |
Additional paid-in capital | 279,800,072 | 278,890,153 |
Accumulated deficit | (173,839,540) | (165,718,953) |
Accumulated other comprehensive loss | (123,210) | (67,941) |
Total Stockholders' Equity - NightHawk Biosciences, Inc. | 105,842,442 | 113,108,314 |
Non-Controlling Interest | (1,143,954) | (1,074,743) |
Total Stockholders' Equity | 104,698,488 | 112,033,571 |
Total Liabilities and Stockholders' Equity | $ 114,266,522 | $ 120,961,233 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2022 | Dec. 31, 2021 |
Consolidated Balance Sheets | ||
Common stock, par value (in dollars per share) | $ 0.0002 | $ 0.0002 |
Common stock, shares authorized | 250,000,000 | 250,000,000 |
Common stock, shares issued | 25,649,824 | 25,649,824 |
Common stock, shares outstanding | 25,649,824 | 25,649,824 |
Consolidated Statements of Oper
Consolidated Statements of Operations and Comprehensive Loss - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Revenue: | ||
Grant and contract revenue | $ 212,418 | $ 538,645 |
Operating expenses: | ||
Research and development | 3,933,347 | 3,406,248 |
General and administrative | 3,776,623 | 4,767,645 |
Change in fair value of contingent consideration | (21,000) | 6,000 |
Total operating expenses | 7,688,970 | 8,179,893 |
Loss from operations | (7,476,552) | (7,641,248) |
Change in fair value of warrant liability | 7,779 | (8,702) |
Interest income | 120,702 | 195,165 |
Unrealized (loss) gain on available-for-sale securities | (836,593) | (164,513) |
Other expense, net | (5,134) | (3,842) |
Total non-operating income (loss) | (713,246) | 18,108 |
Net loss before income taxes | (8,189,798) | (7,623,140) |
Net loss | (8,189,798) | (7,623,140) |
Net loss - non-controlling interest | (69,211) | (90,962) |
Net loss attributable to Heat Biologics, Inc. | $ (8,120,587) | $ (7,532,178) |
Net loss per share, basic (in dollars per share) | $ (0.32) | $ (0.31) |
Net loss per share, diluted (in dollars per share) | $ (0.32) | $ (0.31) |
Weighted-average common shares outstanding, basic (in shares) | 25,593,948 | 24,199,916 |
Weighted-average common shares outstanding, diluted (in shares) | 25,593,948 | 24,199,916 |
Comprehensive loss: | ||
Net loss | $ (8,189,798) | $ (7,623,140) |
Unrealized (loss) gain on foreign currency translation | (55,269) | 18,268 |
Total comprehensive loss | (8,245,067) | (7,604,872) |
Comprehensive loss attributable to non-controlling interest | (69,211) | (90,962) |
Comprehensive loss - Heat Biologics, Inc. | $ (8,175,856) | $ (7,513,910) |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) | Common Stock | APIC | Accumulated Deficit | Accumulated Other Comprehensive Gain (Loss) | Non-Controlling Interest | Total |
Beginning Balance at Dec. 31, 2020 | $ 4,519 | $ 247,048,349 | $ (130,647,485) | $ (166,056) | $ (745,404) | $ 115,493,923 |
Issuance of common stock under ATM, net of issuance costs | 420 | 26,303,862 | 26,304,282 | |||
Issuance of common stock from vesting of restricted stock awards | 82 | (82) | ||||
Stock issuance costs | (658,184) | (658,184) | ||||
Stock based compensation | 2,897,580 | 2,897,580 | ||||
Issuance of restricted stock | 3 | (3) | ||||
Exercise of options | 6 | 27,255 | 27,261 | |||
Cancellation and payout of fractional shares | (3) | 3 | ||||
Other comprehensive loss | 18,268 | 18,268 | ||||
Net loss | (7,532,178) | (90,962) | (7,623,140) | |||
Ending Balance at Mar. 31, 2021 | 5,027 | 275,618,780 | (138,179,663) | (147,788) | (836,366) | 136,459,990 |
Beginning Balance at Dec. 31, 2021 | 5,055 | 278,890,153 | (165,718,953) | (67,941) | (1,074,743) | 112,033,571 |
Issuance of common stock from vesting of restricted stock awards | 65 | (65) | ||||
Stock based compensation | 909,984 | 909,984 | ||||
Other comprehensive loss | (55,269) | (55,269) | ||||
Net loss | (8,120,587) | (69,211) | (8,189,798) | |||
Ending Balance at Mar. 31, 2022 | $ 5,120 | $ 279,800,072 | $ (173,839,540) | $ (123,210) | $ (1,143,954) | $ 104,698,488 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Cash Flows from Operating Activities | ||
Net loss | $ (8,189,798) | $ (7,623,140) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 207,106 | 101,803 |
Noncash lease expense | 21,536 | 21,863 |
Noncash interest expense | 6,317 | 3,743 |
Stock-based compensation | 909,983 | 2,897,580 |
Change in fair value of common stock warrants | (7,779) | 8,702 |
Change in fair value of contingent consideration | (21,000) | 6,000 |
Unrealized loss (gain) on investments | 907,315 | 146,313 |
Increase (decrease) in cash arising from changes in assets and liabilities: | ||
Accounts receivable | (33,047) | 73,814 |
Prepaid expenses and other current assets | 539,003 | 123,908 |
Grant receivable | (206,163) | |
Other assets | (4,801,687) | |
Accounts payable | 1,303,871 | (259,138) |
Accrued expenses and other liabilities | (849,469) | 169,665 |
Deferred revenue | (510,188) | |
Other long-term liabilities | 1,550 | 7,511 |
Deposits | (2,406) | (18,422) |
Net Cash Used in Operating Activities | (10,214,668) | (4,849,986) |
Cash Flows from Investing Activities | ||
Purchase of short-term investments | (109,806) | (38,202,476) |
Sale of short-term investments | 17,998,995 | 37,998,617 |
Purchase of property and equipment | (1,090,748) | (363,398) |
Net Cash Provided by (Used in) Investing Activities | 16,798,441 | (567,257) |
Cash Flows from Financing Activities | ||
Proceeds from the issuance of common stock | 26,304,282 | |
Proceeds from exercise of stock options | 27,261 | |
Stock issuance costs | (658,184) | |
Repayments on principal of finance lease | (55,191) | (30,171) |
Net Cash (Used In) Provided by Financing Activities | (55,191) | 25,643,188 |
Effect of exchange rate changes on cash and cash equivalents | 2,254 | (1,088) |
Net Increase in Cash and Cash Equivalents | 6,530,836 | 20,224,857 |
Cash and Cash Equivalents - Beginning of Period | 8,053,879 | 10,931,890 |
Cash and Cash Equivalents - End of Period | 14,584,715 | 31,156,747 |
Supplemental Disclosure for Cash Flow Information: | ||
Tax obligation for employee share-based transaction in accrued liabilities | $ 90,030 | |
Right-of-use assets obtained on operating lease commencements | 293,172 | |
Supplemental disclosure of non-cash investing and financing activities: | ||
Purchases of property and equipment included in accounts payable | $ 768,776 |
Basis of Presentation and Signi
Basis of Presentation and Significant Accounting Polices | 3 Months Ended |
Mar. 31, 2022 | |
Basis of Presentation and Significant Accounting Policies | |
Basis of Presentation and Significant Accounting Policies | 1. Basis of Presentation and Significant Accounting Policies Basis of Presentation and Principles of Consolidation Effective May 3, 2022, Heat Biologics, Inc. changed its name to NightHawk Biosciences, Inc. (the “Company”) by filing a Certificate of Amendment (the “Certificate of Amendment”) to its Third Amended and Restated Certificate of Incorporation with the Secretary of State of the State of Delaware. The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial reporting. Certain information or footnote disclosures normally included in the annual financial statements prepared in accordance with U.S. GAAP have been condensed, or omitted, pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). In the opinion of the Company’s management, these financial statements include all normal and recurring adjustments necessary for the fair statement of the results for the interim periods presented. The results for the three months ended March 31, 2022 are not necessarily indicative of the results that may be expected for any other interim period or for the fiscal year ending December 31, 2022. The consolidated financial statements as of and for the three months ended March 31, 2022 and 2021 are unaudited. The balance sheet as of December 31, 2021 is derived from the audited consolidated financial statements as of that date. These financial statements should be read in conjunction with the audited consolidated financial statements and related notes, contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 filed with the SEC on March 11, 2022 (the “2021 Annual Report”). The accompanying unaudited consolidated financial statements as of and for the three months ended March 31, 2022 and 2021 include the accounts of the Company, and its subsidiaries, Pelican Therapeutics, Inc. (“Pelican”), Heat Biologics I, Inc. (“Heat I”), Heat Biologics III, Inc. (“Heat III”), Heat Biologics IV, Inc. (“Heat IV”), Heat Biologics GmbH, Heat Biologics Australia Pty Ltd., Zolovax, Inc., Skunkworx Bio, Inc. (formerly known as Delphi Therapeutics, Inc.), Scorpion Biological Services, Inc. (formerly Scorpion Biosciences, Inc), Blackhawk Bio, Inc, and Abacus Biotech, Inc. The functional currency of the entities located outside the United States of America (the foreign entities) is the applicable local currency of the foreign entities. Assets and liabilities of the foreign entities are translated at period-end exchange rates. Statement of operations accounts are translated at the average exchange rate during the period. The effects of foreign currency translation adjustments are included in other comprehensive loss, which is a component of accumulated other comprehensive loss in stockholders’ equity. All significant intercompany accounts and transactions have been eliminated in consolidation. At March 31, 2022 and December 31, 2021, Heat held 85% controlling interest in Pelican. Heat accounts for its less than 100% interest in accordance with U.S. GAAP. Accordingly, the Company presents non-controlling interest as a component of stockholders’ equity on its consolidated balance sheets and reports non-controlling interest net loss under the heading “net loss – non-controlling interest” on its consolidated statements of operations and comprehensive loss. Liquidity and Capital Resources The Company has an accumulated deficit of approximately $173.8 million as of March 31, 2022 and a net loss of approximately $8.2 million for the three months ended March 31, 2022 and has not generated significant revenue or positive cash flows from operations. The Company expects to incur significant expenses and continued losses from operations for the foreseeable future. The Company expects its expenses to increase in connection with its ongoing activities, particularly as the Company continues its research and development and advances its clinical trials of, and seeks marketing approval for, its product candidates, builds its in-house bioanalytic, process development and manufacturing facility and expands its infectious disease/biological threat program, including its support of the development of, and commencement of operations at, a new biodefense-focused l arge molecule and biologics biomanufacturing facility in Manhattan, Kansas not be available to the Company on acceptable terms, or at all. If the Company is unable to raise capital when needed or on attractive terms, it would be forced to delay, reduce or eliminate its research and development programs or any future commercialization efforts. To meet its capital needs, the Company intends to continue to consider multiple alternatives, including, but not limited to, additional equity financings such as sales of its common stock under at-the-market offerings, if available, debt financings, partnerships, collaborations and other funding transactions. As of March 31, 2022, the Company had approximately $84.1 million in cash and cash equivalents and short-term investments, which it believes is sufficient to fund its operations for at least one year from the date these consolidated financial statements were issued. This is based on the Company’s current estimates, and the Company could use its available capital resources sooner than it currently expects. The Company will need to generate significant revenues to achieve profitability, and it may never do so. Risk and Uncertainties The Company’s future results of operations involve a number of risks and uncertainties. Factors that could affect the Company’s future operating results and cause actual results to vary materially from expectations include, but are not limited to, uncertainty of results of clinical trials and reaching milestones, uncertainty of regulatory approval of the Company’s potential drug candidates or its manufacturing facility, uncertainty of market acceptance of the Company’s products or manufacturing capability or success of new business ventures, competition from substitute products and larger companies, securing and protecting proprietary technology, strategic relationships and dependence on key individuals and sole source suppliers. The Company relies on third-party manufacturers to purchase from their third-party vendors the materials necessary to produce product candidates and manufacture product candidates for clinical studies. The Company also depends on third-party suppliers for key materials and services used in research and development, as well as manufacturing processes, and are subject to certain risks related to the loss of these third-party suppliers or their inability to supply adequate materials and services. The Company does not control the manufacturing processes of the contract development and manufacturing organizations, or CDMOs, with whom it contracts and is dependent on these third parties for the production of its therapeutic candidates in accordance with relevant regulations (such as current Good Manufacturing Practices, or cGMP), which includes, among other things, quality control, quality assurance and the maintenance of records and documentation. Cash and Cash Equivalents The Company considers all cash and other highly liquid investments with initial maturities from the date of purchase of three months or less to be cash and cash equivalents. Derivative Financial Instruments The Company has issued common stock warrants in connection with the execution of certain equity financings. The fair value of the warrants, which were deemed to be derivative instruments, was recorded as a derivative liability under the provisions of ASC Topic 815 Derivatives and Hedging (“ASC 815”) because they are not considered indexed to the Company’s own stock. Subsequently, the liability is adjusted to fair value as of the end of each reporting period and the changes in fair value of derivative liabilities are recorded in the consolidated statements of operations and comprehensive loss under the caption “Change in fair value of warrant liability.” See Note 3 for additional information. The fair value of the warrants, including the warrants issued in connection with the January 2020 common stock offering and recorded as a liability, was determined using the Monte Carlo simulation model, which is deemed to be an appropriate model due to the terms of the warrants issued. The fair value of warrants was affected by changes in inputs to the Monte Carlo simulation model including the Company’s stock price, expected stock price volatility, the remaining term, and the risk-free interest rate. This model uses Level 3 inputs, including stock price volatility, in the fair value hierarchy established by ASC 820 Fair Value Measurement. At March 31, 2022, the fair value of such warrants was $3,241, which is classified as a long-term derivative warrant liability on the Company’s consolidated balance sheets. Short-term Investments The Company’s short-term investments are equity securities and are carried at their fair value based on quoted market prices. Realized and unrealized gains and losses on equity securities are included in net earnings in the period earned or incurred. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Estimates are used for, but not limited to, useful lives of fixed assets, contingent consideration, in process research and development (“IPR&D”), income taxes, valuation of warrant liabilities, and stock-based compensation. Actual results may differ from those estimates. Segments Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision-maker in making decisions regarding resource allocation and assessing performance. To date, the Company has viewed the operations and managed the business as one segment. Business Combinations The Company accounts for acquisitions using the acquisition method of accounting, which requires that all identifiable assets acquired, and liabilities assumed be recorded at their estimated fair values. The excess of the fair value of purchase consideration over the fair values of identifiable assets and liabilities is recorded as goodwill. When determining the fair values of assets acquired and liabilities assumed, management makes significant estimates and assumptions. Critical estimates in valuing certain intangible assets include but are not limited to future expected cash flows from acquired patented technology. Management’s estimates of fair value are based upon assumptions believed to be reasonable, but are inherently uncertain and unpredictable and, as a result, actual results may differ from estimates. In-Process Research and Development The Company classifies intangible assets into three categories: (1) intangible assets with definite lives subject to amortization, (2) intangible assets with indefinite lives not subject to amortization and (3) goodwill. The Company determines the useful lives of definite-lived intangible assets after considering specific facts and circumstances related to each intangible asset. Factors the Company considers when determining useful lives include the contractual term of any agreement related to the asset, the historical performance of the asset, and other economic facts; including competition and specific market conditions. Intangible assets that are deemed to have definite lives are amortized, primarily on a straight-line basis, over their estimated useful lives. Intangible assets that are deemed to have indefinite lives, are reviewed for impairment annually, or more frequently if events or changes in circumstances indicate that the asset might be impaired. The impairment test for indefinite-lived intangibles, consists of a comparison of the fair value of the intangible asset with its carrying amount. If the carrying amount exceeds the fair value, an impairment charge is recognized in an amount equal to that excess. Indefinite-lived intangible assets are not amortized. In-process research and development, or IPR&D, assets are considered to be indefinite-lived until the completion or abandonment of the associated research and development projects. IPR&D assets represent the fair value assigned to technologies that the Company acquires, which at the time of acquisition have not reached technological feasibility and have no alternative future use. During the period that the assets are considered indefinite-lived, they are tested for impairment on an annual basis, or more frequently if the Company becomes aware of any events occurring or changes in circumstances that indicate that the fair value of the IPR&D assets are less than their carrying amounts. If and when development is complete, which generally occurs upon regulatory approval and the ability to commercialize products associated with the IPR&D assets, these assets are then deemed definite-lived and are amortized based on their estimated useful lives at that point in time. If development is terminated or abandoned, the Company may have a full or partial impairment charge related to the IPR&D assets, calculated as the excess of carrying value of the IPR&D assets over fair value. Contingent Consideration Consideration paid in a business combination may include potential future payments that are contingent upon the acquired business achieving certain milestones in the future (“contingent consideration”). Contingent consideration liabilities are measured at their estimated fair value as of the date of acquisition, with subsequent changes in fair value recorded in the consolidated statements of operations. The Company estimates the fair value of the contingent consideration as of the acquisition date using the estimated future cash outflows based on the probability of meeting future milestones. The milestone payments will be made upon the achievement of clinical and commercialization milestones as well as single low digit royalty payments and payments upon receipt of sublicensing income. Subsequent to the date of acquisition, the Company reassesses the actual consideration earned and the probability-weighted future earn-out payments at each balance sheet date. Any adjustment to the contingent consideration liability will be recorded in the consolidated statements of operations. Contingent consideration liabilities expected to be settled within 12 months after the balance sheet date are presented in current liabilities, with the non-current portion recorded under long term liabilities in the consolidated balance sheets. Deferred Revenue Deferred revenue is comprised of an exclusive license agreement with Shattuck Labs, Inc. (“Shattuck”) pursuant to which the Company licensed certain provisional patent applications and know-how related to fusion proteins to treat cancer and other diseases that were not being developed by us. Shattuck paid the Company an initial license fee of $50,000 in June 2016 and is obligated to pay the Company fees upon its receipt of sublicensing income, achievement of certain milestones, and royalties upon sales of commercial products. In as much of the technology that the Company out-licensed is in the early stages of development and there is a low likelihood of success for any technology at such stage, there can be no assurance that any products will be developed by Shattuck or that the Company will derive any revenue from Shattuck. Research and Development Research and development includes costs associated with developmental products not yet approved by the FDA as well as costs associated with bringing developmental products into advanced phase clinical trials as incurred. These costs consist primarily of pre-manufacturing and manufacturing drug costs, clinical trial execution, investigator payments, license fees, salaries, stock-based compensation and related personnel costs. Other costs include fees paid to consultants and outside service providers related to the development of the Company’s product candidates and other expenses relating to the design, development, and testing and enhancement of its product candidates. Grants Receivable and Revenue Recognition Effective January 1, 2019, the Company has adopted ASU No. 2018-08, Not-For-Profit Entities (Topic 958): Clarifying the Scope and the Accounting Guidance for Contributions Received and Contributions Made. The CPRIT grant covers the periods from June 1, 2017 through May 31, 2023, for a total grant award of up to $15.2 million. CPRIT advances grant funds upon request by the Company consistent with the agreed upon amounts and schedules as provided in the contract. The first tranche of funding of $1.8 million was received in May 2017, and a second tranche of funding of $6.5 million was received in October 2017, and the third tranche of funding of $5.4 million was received in December 2019. The remaining $1.5 million will be paid, on a reimbursement basis, after the Company has fulfilled every objective of the final goals of the grant. Funds received are reflected in deferred revenue as a liability until revenue is earned. Grant revenue is recognized when qualifying costs are incurred. When grant funds are received after costs have been incurred, the Company records revenue and a corresponding grants receivable until grant funds are received. As of the March 31, 2022, all $15.2 million has been recognized to date. On January 7, 2020, the Company was awarded a grant of up to $224,713 from the National Institute of Allergy and Infectious Diseases (“NIH”). The NIH grant provides funding for continued development of the Company’s technologies for PTX-35. The grant funds will be made available by the NIH to the Company as allowable expenses are incurred. For the three months ended March 31, 2022 and 2021, the Company incurred no allowable expenses under the NIH grant and did not recognize any corresponding grant revenue for the three months ended March 31, 2022 and 2021. Prepaid Expenses and Other Current Assets The Company’s prepaid expenses and other current assets consist primarily of the amount paid in advance for manufacturing activities, clinical trial support, and insurance. Income Taxes Income taxes are accounted for using the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the carrying amounts of assets and liabilities and their respective tax bases, operating loss carryforwards, 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. Deferred tax assets are reduced by a valuation allowance to the extent that utilization is not presently more likely than not. Significant Accounting Policies The significant accounting policies used in preparation of these interim financial statements are disclosed in the audited consolidated financial statements and related notes included in the Company’s 2021 Annual Report and have not changed significantly since such filing. Other Assets In conjunction with a lease agreement further discussed in Note 13, Scorpion has made reimbursement payments to the lessor for costs incurred in conjunction with the leased site. These payments are included in other assets on the consolidated balance sheets and will be classified as a right-of-use asset upon commencement. Recently Issued Accounting Pronouncements In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses which requires financial assets measured at amortized cost basis to be presented at the net amount expected to be collected. This standard is effective for fiscal years beginning after December 15, 2022 and the Company is currently evaluating the expected impact of this standard but does not expect it to have a material impact on its consolidated financial statements upon adoption. In August 2020, the FASB issued ASU No. 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. This ASU simplifies the accounting for convertible instruments. This ASU also requires entities to use the if-converted method for all convertible instruments in calculating diluted earnings-per-share. The ASU is effective for annual periods beginning after December 15, 2023 with early adoption permitted. We are currently evaluating the impact this standard will have on our consolidated financial statements. |
Acquisition of Pelican Therapeu
Acquisition of Pelican Therapeutics | 3 Months Ended |
Mar. 31, 2022 | |
Acquisition of Pelican Therapeutics | |
Acquisition of Pelican Therapeutics | 2. Acquisition of Pelican Therapeutics In 2017, the Company consummated the acquisition of 80% of the outstanding equity of Pelican, a related party, and Pelican became a majority owned subsidiary of the Company. In October 2018, the Company entered into an agreement with the University of Miami (“UM”) whereby UM exchanged its shares of stock in the Company’s subsidiaries, Heat I, Inc. and Pelican. The stock exchange resulted in the Company increasing its controlling ownership in Pelican from 80% to 85%. Under the Pelican stock acquisition agreement, the Company is also obligated to make future payments based on the achievement of certain clinical and commercialization milestones, as well as low single digit royalty payments and payments upon receipt of sublicensing income. The fair value of these future milestone payments is reflected in the contingent consideration account under current liabilities with the non-current portion under long term liabilities on the balance sheet. The estimated fair value of the contingent consideration was determined using a probability-weighted income approach. The Company estimates the fair value of the contingent consideration on a quarterly basis. At the time of the Pelican acquisition, the Company’s CEO and certain affiliated entities as well as two of the Company’s directors and certain affiliated entities directly or indirectly owned shares of Pelican common stock purchased by the Company. As a result, approximately 22.7% of any such milestone payments will be paid to certain directors of the Company which is presented separately on the balance sheet as contingent consideration, related party. On June 22, 2020, the Company achieved the first milestone when it dosed the first patient in the first Phase 1 clinical trial of PTX-35. As discussed in Note 10, in May 2016, Pelican was awarded a $15.2 million CPRIT Grant from CPRIT for development of Pelican’s lead product candidate, PTX-35. The CPRIT Grant supports Pelican in developing PTX-35 through its current Phase 1 clinical trial designed to evaluate PTX-35 in combination with other immunotherapies. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 3 Months Ended |
Mar. 31, 2022 | |
Fair Value of Financial Instruments | |
Fair Value of Financial Instruments | 3. Fair Value of Financial Instruments The carrying amount of certain of the Company’s financial instruments, including cash and cash equivalents, accounts payable and accrued expenses and other payables approximate fair value due to their short maturities. As a basis for determining the fair value of certain of the Company’s financial instruments, the Company utilizes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows: Level I – Observable inputs such as quoted prices in active markets for identical assets or liabilities. Level II – Observable inputs, other than Level I prices, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level III – Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. This hierarchy requires the Company to use observable market data, when available, and to minimize the use of unobservable inputs when determining fair value. Assets and liabilities measured at fair value are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the entire fair value measurement requires management to make judgments and consider factors specific to the asset or liability. The Company’s cash equivalents are classified within Level I of the fair value hierarchy. The Company’s short-term investments consist of Level I securities which are comprised of highly liquid money market funds. The estimated fair value of the short-term investments was based on quoted market prices. There were no transfers between fair value hierarchy levels during the quarters ended March 31, 2022 or 2021. In January 2020, the Company issued warrants in connection with the public offering of common stock (the “January 2020 Warrants”). Pursuant to the terms of these warrants, the warrants were not considered indexed to the Company’s own stock and therefore are required to be measured at fair value and reported as a liability in the consolidated balance sheets. Additionally, upon the closing of the January 2020 offering, 479,595 outstanding warrants were evaluated for whether they were modified for accounting purposes and it was determined that they were required to be classified as a liability. The fair value of the warrant liability is based on the Monte Carlo methodology. The Company is required to revalue the warrants at each reporting date with any changes in fair value recorded on our consolidated statement of operations and comprehensive loss. The valuation of the warrants is classified under Level 3 of the fair value hierarchy due to the need to use assumptions in the valuation that are both significant to the fair value measurement and unobservable. In order to calculate the fair value of the warrants, certain assumptions were made, including the selling price or fair market value of the underlying common stock, risk-free interest rate, volatility, and remaining life. Changes to the assumptions could cause significant adjustments to valuation. The Company estimated a volatility factor utilizing its own data. The risk-free interest rate is based on the U.S. Treasury yield in effect at the time of the grant for treasury securities of similar maturity. The following table presents quantitative information about the inputs used in the valuation for the Company’s fair value measurement of the warrant liability classified as Level 3: March 31, 2022 December 31, 2021 Current stock price $ 3.06 $ 3.04 Estimated volatility of future stock price 85.81 % 133.13 % Risk free interest rate 1.89 % 0.55 % Contractual term 1.66 years 1.90 years As of March 31, 2022, there were a total of 9,357 warrants outstanding that were reported as a liability on the consolidated balance sheet. The fair value of financial instruments measured on a recurring basis is as follows: As of March 31, 2022 Description Total Level 1 Level 2 Level 3 Assets: Short-term investments $ 69,528,419 $ 69,528,419 — — Liabilities: Contingent consideration $ 3,321,515 — — $ 3,321,515 Warrant liability $ 3,241 — — $ 3,241 As of December 31, 2021 Description Total Level 1 Level 2 Level 3 Assets: Short-term investments $ 88,324,922 $ 88,324,922 — — Liabilities: Contingent consideration $ 3,342,515 — — $ 3,342,515 Warrant liability $ 11,020 — — $ 11,020 The following tables summarize the change in fair value, as determined by Level 3 inputs, for all assets and liabilities using unobservable Level 3 inputs for the three months ended March 31, 2022 and 2021: Contingent Warrant Consideration Liability Balance at December 31, 2021 $ 3,342,515 $ 11,020 Change in fair value (21,000) (7,779) Balance at March 31, 2022 $ 3,321,515 $ 3,241 Contingent Warrant Consideration Liability Balance at December 31, 2020 $ 2,912,515 $ 33,779 Change in fair value 6,000 8,702 Balance at March 31, 2021 $ 2,918,515 $ 42,481 The change in the fair value of the contingent consideration for the three months ended March 31, 2022 was primarily due to a change in discount rate and the passage of time on the fair value measurement. The change in fair value of the warrant liability for the three months ended March 31, 2022 was primarily due to a decrease in the fair value of the underlying stock. Adjustments associated with the change in fair value of contingent consideration and warrant liability are included in the Company’s consolidated statement of operations and comprehensive loss. The following table presents quantitative information about the inputs and valuation methodologies used for the Company’s fair value measurements of contingent consideration classified as Level 3 as of March 31, 2022 and December 31, 2021: As of March 31, 2022 Valuation Significant Weighted Average Methodology Unobservable Input (range, if applicable) Contingent Consideration Probability weighted income approach Milestone dates 2022-2032 Discount rate 8.23% Probability of occurrence 4.9% to 75% As of December 31, 2021 Valuation Significant Weighted Average Methodology Unobservable Input (range, if applicable) Contingent Consideration Probability weighted income approach Milestone dates 2022-2031 Discount rate 7.51% Probability of occurrence 4.9% to 75% The Company measures certain non-financial assets on a non-recurring basis, including goodwill and in-process R&D. This analysis requires significant judgments, including primarily the estimation of future development costs, the probability of success in various phases of its development programs, potential post-launch cash flows and a risk-adjusted weighted average cost of capital. |
Short-Term Investments
Short-Term Investments | 3 Months Ended |
Mar. 31, 2022 | |
Short-Term Investments. | |
Short-Term Investments | 4. Short-Term Investments Short-term investments consist of equity securities. The Company holds its securities at fair value as of March 31, 2022 and December 31, 2021. Unrealized gains and losses on securities are reported in the other (expense) income line item on the statements of operations and comprehensive loss. Short-term investments at March 31, 2022 and December 31, 2021 consisted of mutual funds with fair values of $69.5 million and $88.3 million, respectively. |
Prepaid Expenses and Other Curr
Prepaid Expenses and Other Current Assets | 3 Months Ended |
Mar. 31, 2022 | |
Prepaid Expenses And Other Current Assets. | |
Prepaid Expenses and Other Current Assets | 5. Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consist of the following at: March 31, December 31, 2022 2021 Prepaid manufacturing expense $ 580,930 $ 563,280 Prepaid insurance 418,974 704,650 Prepaid preclinical and clinical expenses 887,121 1,158,560 Other prepaid expenses and current assets 477,893 460,030 $ 2,364,918 $ 2,886,520 |
Property and Equipment
Property and Equipment | 3 Months Ended |
Mar. 31, 2022 | |
Property and Equipment | |
Property and Equipment | 6. Property and Equipment Property and equipment are recorded at cost and depreciated using the straight-line method over their estimated useful lives, ranging generally from three Property and equipment consist of the following at: March 31, December 31, 2022 2021 Lab equipment $ 3,483,311 $ 3,178,855 Computers 85,070 85,071 Furniture and fixtures 66,106 66,106 Leasehold improvements 22,563 22,563 Construction-in-process 1,095,912 309,620 Total 4,752,962 3,662,215 Accumulated depreciation (1,654,297) (1,503,736) Property and equipment, net $ 3,098,665 $ 2,158,479 Depreciation expense was $150,562 and $72,078 for the three months ended March 31, 2022 and 2021, respectively. |
In-Process R&D
In-Process R&D | 3 Months Ended |
Mar. 31, 2022 | |
In-Process R&D | |
In-Process R&D | 7. In-process R&D of $5.9 million was recorded in connection with the acquisition of Pelican, as described in Note 2. During the fourth quarter of 2021, due to a sustained decline in the quoted market price of its common stock, the Company performed an interim impairment analysis using the income approach and in-process R&D with a total carrying value of $5.9 million was written down to its estimated fair value of $3.5 million and an impairment charge of $2.4 million during the fourth quarter of 2021 was recorded. The Company performs an annual impairment test at the reporting unit level as of April 1st of each fiscal year. No impairment was recorded during the quarters ended March 31, 2022 or 2021. |
Accrued Expenses and Other Liab
Accrued Expenses and Other Liabilities | 3 Months Ended |
Mar. 31, 2022 | |
Accrued Expenses and Other Liabilities | |
Accrued Expenses and Other Liabilities | 8. Accrued Expenses and Other Liabilities Accrued expenses and other liabilities consist of the following: March 31, December 31, 2022 2021 Accrued preclinical and clinical trial expenses $ 794,010 $ 955,013 Other expenses 286,190 631,312 Accrued franchise tax 229,363 195,000 Compensation and related benefits 205,148 459,178 Accrued manufacturing expenses 129,489 179,173 $ 1,644,200 $ 2,419,676 |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2022 | |
Stockholders' Equity | |
Stockholders' Equity | 9. Stockholders’ Equity At-The-Market-Offering From January 1, 2021 to March 31, 2021 the Company sold approximately 2,106,027 shares of common stock under the Amended and Restated At Market Issuance Sales Agreement, dated August 24, 2020 by and between the Company, B. Riley Securities, Inc. and Cantor Fitzgerald & Co., as amended (the “Common Stock Sales Agreement”), at an average price of approximately $12.18 per share, raising aggregate net proceeds of $25,646,099 after deducting a commission up to 3% . No shares of common stock were sold during the quarter ended March 31, 2022. Common Stock Warrants As of March 31, 2022 and 2021, the Company has outstanding warrants to purchase 747,383 shares of common stock issuable at a weighted-average exercise price of $11.06 per share. The Company had no common stock warranty activity in the quarter ended March 31, 2022 .The following table summarizes the activity of the Company’s common stock warrants for the quarter ended March 31, 2021. Common Stock Warrants Outstanding, December 31, 2020 758,939 Issued 31,000 Expired (42,556) Outstanding, March 31, 2021 747,383 Equity Compensation Plans The Company maintains various equity compensation plans (“Plans”) with substantially similar provisions under which it may award employees, directors and consultants incentive and non-qualified stock options, restricted stock, stock appreciation rights and other stock based awards with terms established by the Compensation Committee of the Board of Directors which has been appointed by the Board of Directors to administer the plans. In addition, at its 2021 Annual Meeting for Stockholders, the stockholders approved the Company’s 2021 Subsidiaries Stock Incentive Plan (the “SSIP”) which allows for the grant of equity interests in subsidiaries of the Company including Skunkworx Bio, Inc. (“SkunkWorx”), Scorpion Biological Services, Inc. (“Scorpion”), Abacus Biotech, Inc. (“Abacus”), Blackhawk Bio, Inc. (“Blackhawk”) and other newly formed subsidiaries of the Company that adopt the SSIP by resolution of their Board of Directors. On August 2, 2021 the Board of Directors, the Compensation Committee and the Board of Directors of Skunkworx, Scorpion, Abacus and Blackhawk granted to Jeff Wolf, Chief Executive Officer, an option under the SSIP to purchase 10,526, 10,638, 10,526 and 10,526 shares of common stock of Skunkworx, Scorpion, Abacus and Blackhawk, respectively, and to William Ostrander, Chief Financial Officer, an option under the SSIP to purchase 2,127 shares of common stock of Scorpion. Accounting for Stock-Based Compensation: Stock Compensation Expense Stock Options Fair Value Determination The following weighted-average assumptions were used for option grants during the three months ended March 31, 2022 and 2021: ● Volatility – The Company used an average historical stock price volatility from its own data plus an analysis of reported data for a peer group of comparable companies that have issued stock options with substantially similar terms. ● Expected life of options – The expected term represents the period that the Company’s stock option grants are expected to be outstanding. The Company elected to utilize the “simplified” method to estimate the expected term. Under this approach, the weighted-average expected life is presumed to be the average of the vesting term and the contractual term of the option. ● Risk-free interest rate – The rate is based on U.S. Treasury interest rates at the time of the grant whose term is consistent with the expected life of the stock options. ● Dividend yield – The expected dividend yield was considered to be 0% since the Company has not paid any dividends and has no plan to do so in the future. ● Forfeitures – As required by ASC 718, Compensation—Stock Compensation, the Company reviews recent forfeitures and stock compensation expense. The Company accounts for forfeitures as they occur. The following table summarizes weighted-average assumptions used in our calculations of fair value for the three months ended March 31, 2022 and 2021: 2022 2021 Dividend yield — % — % Expected volatility 103.82 % 101.43 % Risk-free interest rate 1.95 % 0.43 % Expected lives (years) 6.1 years 5.5 years Stock Option Activity - The following is a summary of the stock option activity for the three months ended March 31, 2022: Weighted Weighted Average Aggregate Average Exercise Intrinsic Remaining Shares Price Value Contractual Life Stock options outstanding at December 31, 2021 2,954,315 $ 7.62 $ 101,306 Granted 78,250 $ 2.86 Expired (542) $ 60.90 Forfeited (28,109) $ 4.91 Stock options outstanding at March 31, 2022 3,003,914 $ 7.52 $ 116,956 8.7 Years Stock options exercisable at March 31, 2022 1,356,824 $ 11.10 $ 62,432 8.0 Years Unrecognized compensation expense related to unvested stock options was $5.2 million as of March 31, 2022, which is expected to be recognized over a weighted-average period of 1.5 years and will be adjusted for forfeitures as they occur. Restricted Stock The following is a summary of restricted stock award activity for the three months ended March 31, 2022: Weighted Average Shares Fair Value Restricted stock at December 31, 2021 370,170 $ 4.71 Granted — — Vested (323,311) $ 4.92 Cancelled — — Restricted stock at March 31, 2022 46,859 $ 3.28 Restricted Stock Units - Under the Plan, the Company previously issued time-based Restricted Stock Units (“RSUs”). RSUs are not actual shares, but rather a right to receive shares in the future. The shares are not issued and the employee cannot sell or transfer shares prior to vesting and has no voting rights until the RSUs vest. The employees' time-based RSUs vest 25% on the award date and 25% each anniversary thereafter. The grant date fair value of the RSUs is equal to the closing market price of our common stock on the grant date. The Company recognizes the grant date fair value of RSUs of shares the Company expects to issue as compensation expense ratably over the requisite service period. No RSUs are outstanding as of March 31, 2022 and December 31, 2021 |
Grant Revenue
Grant Revenue | 3 Months Ended |
Mar. 31, 2022 | |
Grant Revenue. | |
Grant Revenue | 10. Grant Revenue In June 2016, Pelican entered into a cancer research grant contract (or “Grant Contract”) with CPRIT, under which CPRIT awarded a grant not to exceed $15.2 million for use in developing cancer treatments by targeting a novel T-cell costimulatory receptor (namely, TNFRSF25). The Grant Contract covers a period from June 1, 2016 through November 30, 2020, as amended through May 31, 2022. The first tranche of funding of $1.8 million was received in May 2017, a second tranche of funding of $6.5 million was received in October 2017 and a third tranche of funding of $5.4 million was received in December 2019. The remaining $1.5 million will be awarded on a reimbursement basis after the Company has fulfilled every requirement of the grant and the grant has been approved to be finalized. As of March 31, 2022, all $15.2 million has been recognized to date. The grant is subject to customary CPRIT funding conditions including a matching funds requirement where Pelican will match $0.50 for every $1.00 from CPRIT. Consequently, Pelican was required to provide $7.6 million in matching funds over the life of the project. Upon commercialization of the product, the terms of the grant require Pelican to pay tiered royalties in the low to mid-single digit percentages. Such royalties reduce to less than one percent after a mid-single-digit multiple of the grant funds have been paid to CPRIT in royalties. On January 7, 2020, the Company was awarded a grant of up to $224,713 from the NIH. The NIH grant provides funding for continued development of the Company’s technologies for PTX-35. The grant funds will be made available by the NIH to the Company as allowable expenses are incurred. Through March 31, 2022, $15.2 million of grant funding has been recognized as revenue. As of March 31, 2022 and December 31, 2021, we had a grant receivable balance of $1.5 million and $1.3 million, respectively, for CPRIT proceeds not yet received but for which the costs had been incurred or the conditions of the award has been met. At the conclusion of the grant, the Company will be subject to an audit by CPRIT before the final grant payment can be approved and distributed. The Company believes this will not be finalized until 2023. |
Net Loss Per Share
Net Loss Per Share | 3 Months Ended |
Mar. 31, 2022 | |
Net Loss Per Share | |
Net Loss Per Share | 11. Net Loss Per Share Basic net loss per common share is computed by dividing net loss attributable to common stockholders by the weighted-average number of common shares outstanding during the periods. Fully diluted net loss per common share is computed using the weighted average number of common and dilutive common equivalent shares outstanding during the periods. Common equivalent shares consist of stock options, warrants, and unvested restricted stock that are computed using the treasury stock method. For the quarters ended March 31, 2022 and 2021, all of the Company’s common stock options, unvested restricted stock units and warrants are anti-dilutive and therefore have been excluded from the diluted calculation. The following table reconciles net loss to net loss attributable to NightHawk Biosciences, Inc.: For the Three Months Ended March 31, 2022 2021 Net loss $ (8,189,798) $ (7,623,140) Net loss - Non-controlling interest (69,211) (90,962) Net loss attributable to Heat Biologics, Inc. $ (8,120,587) $ (7,532,178) Weighted-average common shares outstanding, basic and diluted 25,593,948 24,199,916 Net loss per share, basic and diluted $ (0.32) $ (0.31) The following potentially dilutive securities were excluded from the calculation of diluted net loss per share during the three months ended March 31, 2022 and 2021 due to their anti-dilutive effect: For the Three Months Ended March 31, 2022 2021 Outstanding stock options 3,003,914 1,697,910 Restricted stock subject to forfeiture and restricted stock units 46,859 259,874 Outstanding common stock warrants 747,383 747,383 |
Income Tax
Income Tax | 3 Months Ended |
Mar. 31, 2022 | |
Income Tax | |
Income Tax | 12. Income Tax Income taxes are accounted for using the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statement carrying amounts of assets and liabilities and their respective tax bases, operating loss carryforwards, 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. As of March 31, 2022, $0.6 million of the deferred tax asset arising from the generation of 2018 net operating losses has been utilized to offset a portion of the previously recorded deferred tax liability associated with indefinite lived R&D in process costs. Specifically, the prior year net operating losses gave rise to an indefinite-lived deferred tax asset which provided sufficient support to offset a portion of the Company’s indefinite-lived deferred tax liability. In accordance with FASB ASC 740, Accounting for Income Taxes, the Company reflects in the accompanying unaudited condensed consolidated financial statements the benefit of positions taken in a previously filed tax return or expected to be taken in a future tax return only when it is considered ‘more-likely-than-not’ that the position taken will be sustained by a taxing authority. As of March 31, 2022, and December 31, 2021, the Company had no unrecognized income tax benefits and correspondingly there is no impact on the Company’s effective income tax rate associated with these items. The Company’s policy for recording interest and penalties relating to uncertain income tax positions is to record them as a component of income tax expense in the accompanying statements of operations and comprehensive loss. As of March 31, 2022, and December 31, 2021, the Company had no such accruals. At March 31, 2022, the Company has federal net operating loss carryforwards of approximately $153,477,285, including $3,027,284 acquired from Pelican Therapeutics, which are available to offset future taxable income. The Company completed a Section 382 study during Q3 2021. It was determined that the Company has experienced five ownership changes of over 50% since 2013, the latest occurring on June 30, 2020. Going forward, the utilization of loss carryforwards and tax credits generated before June 30, 2020 will be subject to an annual limitation. As a result of the ownership changes and limitations, $58,182,000 of federal NOLs and approximately $2,935,000 of federal R&D credits will expire unutilized, in addition to Sec 382 limits on Pelican already in place. |
Leases
Leases | 3 Months Ended |
Mar. 31, 2022 | |
Leases | |
Leases | 13. Leases The Company accounts for its leases under ASC 842. The Company conducts its operations from leased facilities in Morrisville, North Carolina; San Antonio, Texas; and North Brunswick, New Jersey. The North Carolina lease will expire in 2027 and the Texas and New Jersey leases will expire in 2023. The leases are for general office space and lab space and require the Company to pay property taxes, insurance, common area expenses and maintenance costs. In June 2021, the Company entered into a lease agreement with Durham KTP Tech 7, LLC, to lease a 15,996 square foot facility in Morrisville, North Carolina to expand its research and development activities. The lease has a term of eight years following the commencement date and provides the Company the option to extend the lease term for one five year term. It is subject to fixed rate escalation increases and also provides up to $2.4 million for tenant improvements. As the lease had not commenced as of March 31, 2022, the Company has not recorded an operating lease ROU asset or lease liability for this lease in the accompanying condensed consolidated balance sheets. The initial estimate of the minimum amount of undiscounted lease payments due under this lease is $4.7 million. Further, the tabular disclosure of minimum lease payments below does not include payments due under this lease. In October 2021, Scorpion entered into a lease agreement with Merchants Ice II, LLC to lease a 20,144 square foot facility in San Antonio, TX for general office, laboratory, research, analytical, and/or biomanufacturing purposes. Merchants Ice II, LLC is a nonprofit entity investing in the building with the intention to encourage development of emerging technologies. As a result, investments made by both Merchants Ice II, LLC and Scorpion into the building may qualify and share tax credits under the New Market Tax Credit (“NMTC”) program. Scorpion agreed that all investments and expenditures qualifying under the NMTC (i.e., certain equipment and building improvements) would be purchased by the Merchants Ice II, LLC to generate the largest possible tax incentive and Scorpion would reimburse Merchants Ice II, LLC for these payments. As of March 31, 2022, and prior to the execution of the lease agreement, Scorpion has reimbursed Merchants Ice II, LLC $17.0 million which is shown in other assets on the consolidated balance sheets. Upon lease commencement, these assets will be classified as a right-of-use asset. The lease has a term of fifteen years following the commencement date and provides Scorpion the option to extend the lease term for one fifteen-year term, and one subsequent ten year term upon expiration of the first extended term. It is subject to fixed rate escalation increases and also provides up to $2.4 million for tenant improvements. As the lease had not commenced as of March 31, 2022, Scorpion has not recorded a right-of-use asset or lease liability for this lease in the accompanying condensed consolidated balance sheets. The initial estimate of the minimum amount of undiscounted lease payments due under this lease is $11.1 million. Total cash paid for operating leases during the three months ended March 31, 2022 was $0.1 million, and is included within cash flows from operating activities within the consolidated statement of cash flows. The Company leases furniture and specialized lab equipment under finance leases. The related right-of-use assets are amortized on a straight-line basis over the lesser of the lease term or the estimated useful life of the asset. The effective interest rate is 5.47%. The Company’s lease cost is reflected in the accompanying statements of operations and comprehensive loss within the general and administrative and research and development balances as follows: For the Three Months Ended March 31, 2022 For the Three Months Ended March 31, 2021 Operating lease cost $ 125,503 $ 113,555 Finance lease cost Amortization of lease assets 62,861 29,725 Interest on lease liabilities 6,317 3,743 Total finance lease cost $ 69,178 $ 33,468 The weighted average remaining lease term and incremental borrowing rate as of March 31, 2022 were as follows: For the Three Months Ended March 31, 2022 For the Three Months Ended March 31, 2021 Weighted average remaining lease term Operating leases 4.6 years 6.0 years Finance leases 1.9 years 1.7 years Weighted average discount rate Operating leases 5.62 % 6.47 % Finance leases 5.47 % 6.17 % Maturities of operating and finance lease liabilities as of March 31, 2022 were as follows: Operating Leases Finance Leases Total 2022 (excluding the three months ended March 31, 2022) $ 378,343 281,042 659,385 2023 369,601 135,632 505,233 2024 308,183 131,256 439,439 2025 315,132 - 315,132 2026 245,607 - 245,607 2027 209,214 - 209,214 Total minimum lease payments 1,826,080 547,930 2,374,010 Less: imputed interest (222,023) (87,118) (309,141) Present value of lease liabilities $ 1,604,057 $ 460,812 $ 2,064,869 |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2022 | |
Subsequent Event | |
Subsequent Events | 14. Subsequent Events The Company has evaluated its consolidated financial statements for subsequent events through the date the financial statements were issued. On April 18, 2022 (the “Closing Date”), we closed the merger contemplated by the Merger Agreement (the “ ”) . Pursuant to the Merger Agreement, as merger consideration (“Merger Consideration”) we paid at the closing an upfront cash payment of $3,000,000 to certain equity holders of Elusys (the “Sellers”) and contributed $867,646 to the payment of 50% of certain Elusys lease termination and employee severance payments. We will also pay to the Sellers (i) cash of $2,000,000 (ii) Milestone Payments, as defined in the Merger Agreement, related to revenues under an existing contract held by Elusys, and (iii) earn out payments for a period of 12 years from the Closing Date equal to 10% of the gross dollar amount of payments received during each one-year period during such twelve year period with respect to any sale, license or commercialization anywhere in the world of Anthim that either: (a) occurs during the first nine years after the Closing Date in any respect; or (b) occurs thereafter pursuant to any contract, agreement, commitment or order that is placed, granted, awarded or entered into during the first nine years after the Closing Date. Elusys is expected to receive additional revenue from the future fulfillment of an existing U.S. Government contract and NightHawk has agreed to fulfill the future obligations of Elusys under such contract and pass through and distribute to the Sellers the payments received under such contract minus the costs associated with such fulfillment obligations, subject to certain adjustments to the Merger Consideration specified in the Merger Agreement, including income taxes payable with respect to such payments (the “Milestone Payments”). The Merger Agreement further provides that eighty percent of any amounts paid to and received by Elusys (“Additional Earn Out”) after the Closing and prior to June 30, 2023 with respect to the sale of 1,500 pre-filled vials of Anthim shall be paid to the Sellers, subject to certain adjustments specified in the Merger Agreement. On April 18, 2022, we announced a planned development partnership of Scorpion with a private developer, the State of Kansas and local and university affiliates to support the development of a new biodefense-focused large molecule and biologics biomanufacturing facility in Manhattan, Kansas to be developed by a third-party developer and leased to Scorpion. Scorpion intends to utilize the new 500,000+ square foot facility for large molecule and biologics manufacturing, with a particular focus on biodefense. In addition to servicing our own pipeline, Scorpion plans to operate and utilize the facility as a full-service CDMO to provide third-party manufacturing services on a fee-for-service basis. Scorpion and the developer have applied for over $300 million in funding, incentives, and tax relief to support the development of the facility. |
Basis of Presentation and Sig_2
Basis of Presentation and Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2022 | |
Basis of Presentation and Significant Accounting Policies | |
Basis of presentation and Principles of Consolidation | Basis of Presentation and Principles of Consolidation Effective May 3, 2022, Heat Biologics, Inc. changed its name to NightHawk Biosciences, Inc. (the “Company”) by filing a Certificate of Amendment (the “Certificate of Amendment”) to its Third Amended and Restated Certificate of Incorporation with the Secretary of State of the State of Delaware. The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial reporting. Certain information or footnote disclosures normally included in the annual financial statements prepared in accordance with U.S. GAAP have been condensed, or omitted, pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). In the opinion of the Company’s management, these financial statements include all normal and recurring adjustments necessary for the fair statement of the results for the interim periods presented. The results for the three months ended March 31, 2022 are not necessarily indicative of the results that may be expected for any other interim period or for the fiscal year ending December 31, 2022. The consolidated financial statements as of and for the three months ended March 31, 2022 and 2021 are unaudited. The balance sheet as of December 31, 2021 is derived from the audited consolidated financial statements as of that date. These financial statements should be read in conjunction with the audited consolidated financial statements and related notes, contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 filed with the SEC on March 11, 2022 (the “2021 Annual Report”). The accompanying unaudited consolidated financial statements as of and for the three months ended March 31, 2022 and 2021 include the accounts of the Company, and its subsidiaries, Pelican Therapeutics, Inc. (“Pelican”), Heat Biologics I, Inc. (“Heat I”), Heat Biologics III, Inc. (“Heat III”), Heat Biologics IV, Inc. (“Heat IV”), Heat Biologics GmbH, Heat Biologics Australia Pty Ltd., Zolovax, Inc., Skunkworx Bio, Inc. (formerly known as Delphi Therapeutics, Inc.), Scorpion Biological Services, Inc. (formerly Scorpion Biosciences, Inc), Blackhawk Bio, Inc, and Abacus Biotech, Inc. The functional currency of the entities located outside the United States of America (the foreign entities) is the applicable local currency of the foreign entities. Assets and liabilities of the foreign entities are translated at period-end exchange rates. Statement of operations accounts are translated at the average exchange rate during the period. The effects of foreign currency translation adjustments are included in other comprehensive loss, which is a component of accumulated other comprehensive loss in stockholders’ equity. All significant intercompany accounts and transactions have been eliminated in consolidation. At March 31, 2022 and December 31, 2021, Heat held 85% controlling interest in Pelican. Heat accounts for its less than 100% interest in accordance with U.S. GAAP. Accordingly, the Company presents non-controlling interest as a component of stockholders’ equity on its consolidated balance sheets and reports non-controlling interest net loss under the heading “net loss – non-controlling interest” on its consolidated statements of operations and comprehensive loss. |
Liquidity and Capital Resources | Liquidity and Capital Resources The Company has an accumulated deficit of approximately $173.8 million as of March 31, 2022 and a net loss of approximately $8.2 million for the three months ended March 31, 2022 and has not generated significant revenue or positive cash flows from operations. The Company expects to incur significant expenses and continued losses from operations for the foreseeable future. The Company expects its expenses to increase in connection with its ongoing activities, particularly as the Company continues its research and development and advances its clinical trials of, and seeks marketing approval for, its product candidates, builds its in-house bioanalytic, process development and manufacturing facility and expands its infectious disease/biological threat program, including its support of the development of, and commencement of operations at, a new biodefense-focused l arge molecule and biologics biomanufacturing facility in Manhattan, Kansas not be available to the Company on acceptable terms, or at all. If the Company is unable to raise capital when needed or on attractive terms, it would be forced to delay, reduce or eliminate its research and development programs or any future commercialization efforts. To meet its capital needs, the Company intends to continue to consider multiple alternatives, including, but not limited to, additional equity financings such as sales of its common stock under at-the-market offerings, if available, debt financings, partnerships, collaborations and other funding transactions. As of March 31, 2022, the Company had approximately $84.1 million in cash and cash equivalents and short-term investments, which it believes is sufficient to fund its operations for at least one year from the date these consolidated financial statements were issued. This is based on the Company’s current estimates, and the Company could use its available capital resources sooner than it currently expects. The Company will need to generate significant revenues to achieve profitability, and it may never do so. |
Risk and Uncertainties | Risk and Uncertainties The Company’s future results of operations involve a number of risks and uncertainties. Factors that could affect the Company’s future operating results and cause actual results to vary materially from expectations include, but are not limited to, uncertainty of results of clinical trials and reaching milestones, uncertainty of regulatory approval of the Company’s potential drug candidates or its manufacturing facility, uncertainty of market acceptance of the Company’s products or manufacturing capability or success of new business ventures, competition from substitute products and larger companies, securing and protecting proprietary technology, strategic relationships and dependence on key individuals and sole source suppliers. The Company relies on third-party manufacturers to purchase from their third-party vendors the materials necessary to produce product candidates and manufacture product candidates for clinical studies. The Company also depends on third-party suppliers for key materials and services used in research and development, as well as manufacturing processes, and are subject to certain risks related to the loss of these third-party suppliers or their inability to supply adequate materials and services. The Company does not control the manufacturing processes of the contract development and manufacturing organizations, or CDMOs, with whom it contracts and is dependent on these third parties for the production of its therapeutic candidates in accordance with relevant regulations (such as current Good Manufacturing Practices, or cGMP), which includes, among other things, quality control, quality assurance and the maintenance of records and documentation. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all cash and other highly liquid investments with initial maturities from the date of purchase of three months or less to be cash and cash equivalents. |
Derivative Financial Instruments | Derivative Financial Instruments The Company has issued common stock warrants in connection with the execution of certain equity financings. The fair value of the warrants, which were deemed to be derivative instruments, was recorded as a derivative liability under the provisions of ASC Topic 815 Derivatives and Hedging (“ASC 815”) because they are not considered indexed to the Company’s own stock. Subsequently, the liability is adjusted to fair value as of the end of each reporting period and the changes in fair value of derivative liabilities are recorded in the consolidated statements of operations and comprehensive loss under the caption “Change in fair value of warrant liability.” See Note 3 for additional information. The fair value of the warrants, including the warrants issued in connection with the January 2020 common stock offering and recorded as a liability, was determined using the Monte Carlo simulation model, which is deemed to be an appropriate model due to the terms of the warrants issued. The fair value of warrants was affected by changes in inputs to the Monte Carlo simulation model including the Company’s stock price, expected stock price volatility, the remaining term, and the risk-free interest rate. This model uses Level 3 inputs, including stock price volatility, in the fair value hierarchy established by ASC 820 Fair Value Measurement. At March 31, 2022, the fair value of such warrants was $3,241, which is classified as a long-term derivative warrant liability on the Company’s consolidated balance sheets. |
Short-term Investments | Short-term Investments The Company’s short-term investments are equity securities and are carried at their fair value based on quoted market prices. Realized and unrealized gains and losses on equity securities are included in net earnings in the period earned or incurred. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Estimates are used for, but not limited to, useful lives of fixed assets, contingent consideration, in process research and development (“IPR&D”), income taxes, valuation of warrant liabilities, and stock-based compensation. Actual results may differ from those estimates. |
Segments | Segments Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision-maker in making decisions regarding resource allocation and assessing performance. To date, the Company has viewed the operations and managed the business as one segment. |
Business Combinations | Business Combinations The Company accounts for acquisitions using the acquisition method of accounting, which requires that all identifiable assets acquired, and liabilities assumed be recorded at their estimated fair values. The excess of the fair value of purchase consideration over the fair values of identifiable assets and liabilities is recorded as goodwill. When determining the fair values of assets acquired and liabilities assumed, management makes significant estimates and assumptions. Critical estimates in valuing certain intangible assets include but are not limited to future expected cash flows from acquired patented technology. Management’s estimates of fair value are based upon assumptions believed to be reasonable, but are inherently uncertain and unpredictable and, as a result, actual results may differ from estimates. |
In-Process Research and Development | In-Process Research and Development The Company classifies intangible assets into three categories: (1) intangible assets with definite lives subject to amortization, (2) intangible assets with indefinite lives not subject to amortization and (3) goodwill. The Company determines the useful lives of definite-lived intangible assets after considering specific facts and circumstances related to each intangible asset. Factors the Company considers when determining useful lives include the contractual term of any agreement related to the asset, the historical performance of the asset, and other economic facts; including competition and specific market conditions. Intangible assets that are deemed to have definite lives are amortized, primarily on a straight-line basis, over their estimated useful lives. Intangible assets that are deemed to have indefinite lives, are reviewed for impairment annually, or more frequently if events or changes in circumstances indicate that the asset might be impaired. The impairment test for indefinite-lived intangibles, consists of a comparison of the fair value of the intangible asset with its carrying amount. If the carrying amount exceeds the fair value, an impairment charge is recognized in an amount equal to that excess. Indefinite-lived intangible assets are not amortized. In-process research and development, or IPR&D, assets are considered to be indefinite-lived until the completion or abandonment of the associated research and development projects. IPR&D assets represent the fair value assigned to technologies that the Company acquires, which at the time of acquisition have not reached technological feasibility and have no alternative future use. During the period that the assets are considered indefinite-lived, they are tested for impairment on an annual basis, or more frequently if the Company becomes aware of any events occurring or changes in circumstances that indicate that the fair value of the IPR&D assets are less than their carrying amounts. If and when development is complete, which generally occurs upon regulatory approval and the ability to commercialize products associated with the IPR&D assets, these assets are then deemed definite-lived and are amortized based on their estimated useful lives at that point in time. If development is terminated or abandoned, the Company may have a full or partial impairment charge related to the IPR&D assets, calculated as the excess of carrying value of the IPR&D assets over fair value. |
Contingent Consideration | Contingent Consideration Consideration paid in a business combination may include potential future payments that are contingent upon the acquired business achieving certain milestones in the future (“contingent consideration”). Contingent consideration liabilities are measured at their estimated fair value as of the date of acquisition, with subsequent changes in fair value recorded in the consolidated statements of operations. The Company estimates the fair value of the contingent consideration as of the acquisition date using the estimated future cash outflows based on the probability of meeting future milestones. The milestone payments will be made upon the achievement of clinical and commercialization milestones as well as single low digit royalty payments and payments upon receipt of sublicensing income. Subsequent to the date of acquisition, the Company reassesses the actual consideration earned and the probability-weighted future earn-out payments at each balance sheet date. Any adjustment to the contingent consideration liability will be recorded in the consolidated statements of operations. Contingent consideration liabilities expected to be settled within 12 months after the balance sheet date are presented in current liabilities, with the non-current portion recorded under long term liabilities in the consolidated balance sheets. |
Deferred Revenue | Deferred Revenue Deferred revenue is comprised of an exclusive license agreement with Shattuck Labs, Inc. (“Shattuck”) pursuant to which the Company licensed certain provisional patent applications and know-how related to fusion proteins to treat cancer and other diseases that were not being developed by us. Shattuck paid the Company an initial license fee of $50,000 in June 2016 and is obligated to pay the Company fees upon its receipt of sublicensing income, achievement of certain milestones, and royalties upon sales of commercial products. In as much of the technology that the Company out-licensed is in the early stages of development and there is a low likelihood of success for any technology at such stage, there can be no assurance that any products will be developed by Shattuck or that the Company will derive any revenue from Shattuck. |
Research and Development | Research and Development Research and development includes costs associated with developmental products not yet approved by the FDA as well as costs associated with bringing developmental products into advanced phase clinical trials as incurred. These costs consist primarily of pre-manufacturing and manufacturing drug costs, clinical trial execution, investigator payments, license fees, salaries, stock-based compensation and related personnel costs. Other costs include fees paid to consultants and outside service providers related to the development of the Company’s product candidates and other expenses relating to the design, development, and testing and enhancement of its product candidates. |
Grants Receivable and Revenue Recognition | Grants Receivable and Revenue Recognition Effective January 1, 2019, the Company has adopted ASU No. 2018-08, Not-For-Profit Entities (Topic 958): Clarifying the Scope and the Accounting Guidance for Contributions Received and Contributions Made. The CPRIT grant covers the periods from June 1, 2017 through May 31, 2023, for a total grant award of up to $15.2 million. CPRIT advances grant funds upon request by the Company consistent with the agreed upon amounts and schedules as provided in the contract. The first tranche of funding of $1.8 million was received in May 2017, and a second tranche of funding of $6.5 million was received in October 2017, and the third tranche of funding of $5.4 million was received in December 2019. The remaining $1.5 million will be paid, on a reimbursement basis, after the Company has fulfilled every objective of the final goals of the grant. Funds received are reflected in deferred revenue as a liability until revenue is earned. Grant revenue is recognized when qualifying costs are incurred. When grant funds are received after costs have been incurred, the Company records revenue and a corresponding grants receivable until grant funds are received. As of the March 31, 2022, all $15.2 million has been recognized to date. On January 7, 2020, the Company was awarded a grant of up to $224,713 from the National Institute of Allergy and Infectious Diseases (“NIH”). The NIH grant provides funding for continued development of the Company’s technologies for PTX-35. The grant funds will be made available by the NIH to the Company as allowable expenses are incurred. For the three months ended March 31, 2022 and 2021, the Company incurred no allowable expenses under the NIH grant and did not recognize any corresponding grant revenue for the three months ended March 31, 2022 and 2021. |
Prepaid Expenses and Other Current Assets | Prepaid Expenses and Other Current Assets The Company’s prepaid expenses and other current assets consist primarily of the amount paid in advance for manufacturing activities, clinical trial support, and insurance. |
Income Taxes | Income Taxes Income taxes are accounted for using the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the carrying amounts of assets and liabilities and their respective tax bases, operating loss carryforwards, 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. Deferred tax assets are reduced by a valuation allowance to the extent that utilization is not presently more likely than not. |
Significant Accounting Policies | Significant Accounting Policies The significant accounting policies used in preparation of these interim financial statements are disclosed in the audited consolidated financial statements and related notes included in the Company’s 2021 Annual Report and have not changed significantly since such filing. |
Other assets | Other Assets In conjunction with a lease agreement further discussed in Note 13, Scorpion has made reimbursement payments to the lessor for costs incurred in conjunction with the leased site. These payments are included in other assets on the consolidated balance sheets and will be classified as a right-of-use asset upon commencement. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses which requires financial assets measured at amortized cost basis to be presented at the net amount expected to be collected. This standard is effective for fiscal years beginning after December 15, 2022 and the Company is currently evaluating the expected impact of this standard but does not expect it to have a material impact on its consolidated financial statements upon adoption. In August 2020, the FASB issued ASU No. 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. This ASU simplifies the accounting for convertible instruments. This ASU also requires entities to use the if-converted method for all convertible instruments in calculating diluted earnings-per-share. The ASU is effective for annual periods beginning after December 15, 2023 with early adoption permitted. We are currently evaluating the impact this standard will have on our consolidated financial statements. |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Fair Value of Financial Instruments | |
Schedule of fair value inputs | March 31, 2022 December 31, 2021 Current stock price $ 3.06 $ 3.04 Estimated volatility of future stock price 85.81 % 133.13 % Risk free interest rate 1.89 % 0.55 % Contractual term 1.66 years 1.90 years The following table presents quantitative information about the inputs and valuation methodologies used for the Company’s fair value measurements of contingent consideration classified as Level 3 as of March 31, 2022 and December 31, 2021: As of March 31, 2022 Valuation Significant Weighted Average Methodology Unobservable Input (range, if applicable) Contingent Consideration Probability weighted income approach Milestone dates 2022-2032 Discount rate 8.23% Probability of occurrence 4.9% to 75% As of December 31, 2021 Valuation Significant Weighted Average Methodology Unobservable Input (range, if applicable) Contingent Consideration Probability weighted income approach Milestone dates 2022-2031 Discount rate 7.51% Probability of occurrence 4.9% to 75% |
Schedule of fair value of financial instruments measured on a recurring basis | The fair value of financial instruments measured on a recurring basis is as follows: As of March 31, 2022 Description Total Level 1 Level 2 Level 3 Assets: Short-term investments $ 69,528,419 $ 69,528,419 — — Liabilities: Contingent consideration $ 3,321,515 — — $ 3,321,515 Warrant liability $ 3,241 — — $ 3,241 As of December 31, 2021 Description Total Level 1 Level 2 Level 3 Assets: Short-term investments $ 88,324,922 $ 88,324,922 — — Liabilities: Contingent consideration $ 3,342,515 — — $ 3,342,515 Warrant liability $ 11,020 — — $ 11,020 |
Schedule of change in fair value, as determined by Level 3 inputs, for all assets and liabilities using unobservable Level 3 inputs | The following tables summarize the change in fair value, as determined by Level 3 inputs, for all assets and liabilities using unobservable Level 3 inputs for the three months ended March 31, 2022 and 2021: Contingent Warrant Consideration Liability Balance at December 31, 2021 $ 3,342,515 $ 11,020 Change in fair value (21,000) (7,779) Balance at March 31, 2022 $ 3,321,515 $ 3,241 Contingent Warrant Consideration Liability Balance at December 31, 2020 $ 2,912,515 $ 33,779 Change in fair value 6,000 8,702 Balance at March 31, 2021 $ 2,918,515 $ 42,481 |
Prepaid Expenses and Other Cu_2
Prepaid Expenses and Other Current Assets (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Prepaid Expenses And Other Current Assets. | |
Schedule of prepaid expenses and other current assets | Prepaid expenses and other current assets consist of the following at: March 31, December 31, 2022 2021 Prepaid manufacturing expense $ 580,930 $ 563,280 Prepaid insurance 418,974 704,650 Prepaid preclinical and clinical expenses 887,121 1,158,560 Other prepaid expenses and current assets 477,893 460,030 $ 2,364,918 $ 2,886,520 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Property and Equipment | |
Schedule of property and equipment | Property and equipment consist of the following at: March 31, December 31, 2022 2021 Lab equipment $ 3,483,311 $ 3,178,855 Computers 85,070 85,071 Furniture and fixtures 66,106 66,106 Leasehold improvements 22,563 22,563 Construction-in-process 1,095,912 309,620 Total 4,752,962 3,662,215 Accumulated depreciation (1,654,297) (1,503,736) Property and equipment, net $ 3,098,665 $ 2,158,479 |
Accrued Expenses and Other Li_2
Accrued Expenses and Other Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Accrued Expenses and Other Liabilities | |
Schedule of accrued expenses and other liabilities | Accrued expenses and other liabilities consist of the following: March 31, December 31, 2022 2021 Accrued preclinical and clinical trial expenses $ 794,010 $ 955,013 Other expenses 286,190 631,312 Accrued franchise tax 229,363 195,000 Compensation and related benefits 205,148 459,178 Accrued manufacturing expenses 129,489 179,173 $ 1,644,200 $ 2,419,676 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Stockholders' Equity | |
Schedule of common stock warrants outstanding | Common Stock Warrants Outstanding, December 31, 2020 758,939 Issued 31,000 Expired (42,556) Outstanding, March 31, 2021 747,383 |
Schedule of stock option valuation assumptions | The following table summarizes weighted-average assumptions used in our calculations of fair value for the three months ended March 31, 2022 and 2021: 2022 2021 Dividend yield — % — % Expected volatility 103.82 % 101.43 % Risk-free interest rate 1.95 % 0.43 % Expected lives (years) 6.1 years 5.5 years |
Schedule of stock option activity | Weighted Weighted Average Aggregate Average Exercise Intrinsic Remaining Shares Price Value Contractual Life Stock options outstanding at December 31, 2021 2,954,315 $ 7.62 $ 101,306 Granted 78,250 $ 2.86 Expired (542) $ 60.90 Forfeited (28,109) $ 4.91 Stock options outstanding at March 31, 2022 3,003,914 $ 7.52 $ 116,956 8.7 Years Stock options exercisable at March 31, 2022 1,356,824 $ 11.10 $ 62,432 8.0 Years |
Schedule of restricted stock activity | Weighted Average Shares Fair Value Restricted stock at December 31, 2021 370,170 $ 4.71 Granted — — Vested (323,311) $ 4.92 Cancelled — — Restricted stock at March 31, 2022 46,859 $ 3.28 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Net Loss Per Share | |
Schedule of reconciliation of net loss | For the Three Months Ended March 31, 2022 2021 Net loss $ (8,189,798) $ (7,623,140) Net loss - Non-controlling interest (69,211) (90,962) Net loss attributable to Heat Biologics, Inc. $ (8,120,587) $ (7,532,178) Weighted-average common shares outstanding, basic and diluted 25,593,948 24,199,916 Net loss per share, basic and diluted $ (0.32) $ (0.31) |
Schedule of potentially dilutive securities | For the Three Months Ended March 31, 2022 2021 Outstanding stock options 3,003,914 1,697,910 Restricted stock subject to forfeiture and restricted stock units 46,859 259,874 Outstanding common stock warrants 747,383 747,383 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Leases | |
Schedule of lease cost | For the Three Months Ended March 31, 2022 For the Three Months Ended March 31, 2021 Operating lease cost $ 125,503 $ 113,555 Finance lease cost Amortization of lease assets 62,861 29,725 Interest on lease liabilities 6,317 3,743 Total finance lease cost $ 69,178 $ 33,468 |
Schedule of weighted average remaining lease term and incremental borrowing rate | For the Three Months Ended March 31, 2022 For the Three Months Ended March 31, 2021 Weighted average remaining lease term Operating leases 4.6 years 6.0 years Finance leases 1.9 years 1.7 years Weighted average discount rate Operating leases 5.62 % 6.47 % Finance leases 5.47 % 6.17 % |
Schedule of maturities of operating and finance lease liabilities | Maturities of operating and finance lease liabilities as of March 31, 2022 were as follows: Operating Leases Finance Leases Total 2022 (excluding the three months ended March 31, 2022) $ 378,343 281,042 659,385 2023 369,601 135,632 505,233 2024 308,183 131,256 439,439 2025 315,132 - 315,132 2026 245,607 - 245,607 2027 209,214 - 209,214 Total minimum lease payments 1,826,080 547,930 2,374,010 Less: imputed interest (222,023) (87,118) (309,141) Present value of lease liabilities $ 1,604,057 $ 460,812 $ 2,064,869 |
Basis of Presentation and Sig_3
Basis of Presentation and Significant Accounting Policies (Details) | Jan. 07, 2020USD ($) | Oct. 31, 2021ft² | Jun. 30, 2021ft² | Dec. 31, 2019USD ($) | Oct. 31, 2017USD ($) | May 31, 2017USD ($) | Jun. 30, 2016USD ($) | May 31, 2016USD ($) | Mar. 31, 2022USD ($)segment | Mar. 31, 2021USD ($) | Mar. 31, 2022USD ($) | Dec. 31, 2021USD ($) | Dec. 31, 2020USD ($) | Oct. 31, 2018 | Sep. 30, 2018 |
Basis of Presentation and Significant Accounting Policies | |||||||||||||||
Accumulated deficit | $ 173,839,540 | $ 173,839,540 | $ 165,718,953 | ||||||||||||
Net loss | 8,189,798 | $ 7,623,140 | |||||||||||||
Cash, cash equivalents and short term investments | 84,100,000 | 84,100,000 | |||||||||||||
Derivative warrant liability | $ 3,241 | 42,481 | 3,241 | 11,020 | $ 33,779 | ||||||||||
Number of operating segments | segment | 1 | ||||||||||||||
Revenue Recognition | |||||||||||||||
Revenue | $ 212,418 | 538,645 | |||||||||||||
Allowable expenses incurred under NIH grant | 0 | ||||||||||||||
Revenue recognized under NIH grant | 0 | $ 0 | |||||||||||||
Other Assets. | |||||||||||||||
Other assets | $ 16,995,227 | $ 16,995,227 | $ 12,193,540 | ||||||||||||
Morrisville, NC | |||||||||||||||
Other Assets. | |||||||||||||||
Area of facility to be leased | ft² | 15,996 | ||||||||||||||
San Antonio, TX | |||||||||||||||
Other Assets. | |||||||||||||||
Area of facility to be leased | ft² | 20,144 | ||||||||||||||
Shattuck Labs Inc. License Agreement [Member] | Shattuck | |||||||||||||||
Deferred Revenue | |||||||||||||||
Initial license fees | $ 50,000 | ||||||||||||||
Pelican Therapeutics, Inc. | |||||||||||||||
Basis of Presentation and Significant Accounting Policies | |||||||||||||||
Ownership interest in subsidiary | 85.00% | 85.00% | 85.00% | 85.00% | 80.00% | ||||||||||
Pelican Therapeutics, Inc. | |||||||||||||||
Revenue Recognition | |||||||||||||||
Amount awarded from CPRIT grant | $ 15,200,000 | ||||||||||||||
Grant revenue | Maximum | |||||||||||||||
Revenue Recognition | |||||||||||||||
Amount awarded from NIH grant | $ 224,713 | ||||||||||||||
Grant revenue | Pelican Therapeutics, Inc. | |||||||||||||||
Revenue Recognition | |||||||||||||||
Revenue | $ 15,200,000 | ||||||||||||||
Remaining grant amount receivable | $ 1,500,000 | $ 1,500,000 | |||||||||||||
Grant revenue | Pelican Therapeutics, Inc. | Maximum | |||||||||||||||
Revenue Recognition | |||||||||||||||
Amount awarded from CPRIT grant | $ 15,200,000 | ||||||||||||||
Grant revenue | Tranche 1 | Pelican Therapeutics, Inc. | |||||||||||||||
Revenue Recognition | |||||||||||||||
Revenue | $ 1,800,000 | ||||||||||||||
Grant revenue | Tranche 2 | Pelican Therapeutics, Inc. | |||||||||||||||
Revenue Recognition | |||||||||||||||
Revenue | $ 6,500,000 | ||||||||||||||
Grant revenue | Tranche 3 | Pelican Therapeutics, Inc. | |||||||||||||||
Revenue Recognition | |||||||||||||||
Revenue | $ 5,400,000 |
Acquisition of Pelican Therap_2
Acquisition of Pelican Therapeutics (Details) - USD ($) $ in Millions | 1 Months Ended | |||||||
Jun. 30, 2016 | May 31, 2016 | Mar. 31, 2022 | Dec. 31, 2021 | Oct. 31, 2018 | Sep. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | |
Pelican Therapeutics, Inc. | ||||||||
Acquisition of Pelican Therapeutics | ||||||||
Ownership interest in subsidiary | 85.00% | 85.00% | 85.00% | 80.00% | ||||
Pelican Therapeutics, Inc. | ||||||||
Acquisition of Pelican Therapeutics | ||||||||
Percentage of voting interests acquired in acquisition | 80.00% | |||||||
Amount awarded from CPRIT grant | $ 15.2 | |||||||
Pelican Therapeutics, Inc. | Grant revenue | Maximum | ||||||||
Acquisition of Pelican Therapeutics | ||||||||
Amount awarded from CPRIT grant | $ 15.2 | |||||||
Pelican Therapeutics, Inc. | Certain Directors | ||||||||
Acquisition of Pelican Therapeutics | ||||||||
Percentage of milestone payments that will be paid to related parties | 22.70% |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments - Schedule of Warrant Weighted Average Assumptions (Details) | 1 Months Ended | 3 Months Ended | ||
Jan. 31, 2020shares | Mar. 31, 2022USD ($)shares | Mar. 31, 2021USD ($) | Dec. 31, 2021 | |
Fair Value of Financial Instruments | ||||
Assets transfer from level 1 to level 2 | $ 0 | $ 0 | ||
Assets transfer from level 2 to level 1 | 0 | 0 | ||
Liabilities transfer from level 1 to level 2 | 0 | 0 | ||
Liabilities transfer from level 2 to level 1 | 0 | 0 | ||
Level 3 Asset transferred, net | 0 | 0 | ||
Level 3 liabilities transferred, net | $ 0 | $ 0 | ||
Warrants outstanding | shares | 9,357 | |||
Current stock price | ||||
Fair Value of Financial Instruments | ||||
Fair value measurement input | 0.0306 | 0.0304 | ||
Estimated volatility of future stock price | ||||
Fair Value of Financial Instruments | ||||
Fair value measurement input | 0.8581 | 1.3313 | ||
Risk free interest rate | ||||
Fair Value of Financial Instruments | ||||
Fair value measurement input | 0.0189 | 0.0055 | ||
Expected term | ||||
Fair Value of Financial Instruments | ||||
Fair value measurement input | 0.0166 | 0.0190 | ||
Warrant | ||||
Fair Value of Financial Instruments | ||||
Number of warrants reclassified to liability | shares | 479,595 |
Fair Value of Financial Instr_4
Fair Value of Financial Instruments - Schedule of Fair Value Financial Instruments (Details) - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 | Mar. 31, 2021 | Dec. 31, 2020 |
Liabilities: | ||||
Contingent consideration | $ 3,321,515 | $ 3,342,515 | $ 2,918,515 | $ 2,912,515 |
Derivative warrant liability | 3,241 | 11,020 | $ 42,481 | $ 33,779 |
Recurring | ||||
Assets: | ||||
Short-term investments | 69,528,419 | 88,324,922 | ||
Liabilities: | ||||
Contingent consideration | 3,321,515 | 3,342,515 | ||
Derivative warrant liability | 3,241 | 11,020 | ||
Recurring | Level 1 | ||||
Assets: | ||||
Short-term investments | 69,528,419 | 88,324,922 | ||
Recurring | Level 3 | ||||
Liabilities: | ||||
Contingent consideration | 3,321,515 | 3,342,515 | ||
Derivative warrant liability | $ 3,241 | $ 11,020 |
Fair Value of Financial Instr_5
Fair Value of Financial Instruments - Schedule of Fair Value Measurements (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Fair Value of Financial Instruments | ||
Beginning Balance | $ 3,342,515 | $ 2,912,515 |
Change in fair value | (21,000) | 6,000 |
Ending Balance | 3,321,515 | 2,918,515 |
Beginning Balance | 11,020 | 33,779 |
Change in fair value | (7,779) | 8,702 |
Ending Balance | $ 3,241 | $ 42,481 |
Fair Value of Financial Instr_6
Fair Value of Financial Instruments - Schedule of Inputs and Valuation Methodologies Used (Details) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2022 | Dec. 31, 2021 | |
Fair Value of Financial Instruments | ||
Valuation Methodology | Probability weighted income approach | Probability weighted income approach |
Significant unobservable input - milestone dates | 2022-2032 | 2022-2031 |
Discount rate | 8.23% | 7.51% |
Probability of occurrence - minimum | 4.90% | 4.90% |
Probability of occurrence - maximum | 75.00% | 75.00% |
Short-Term Investments (Details
Short-Term Investments (Details) - USD ($) $ in Millions | Mar. 31, 2022 | Dec. 31, 2021 |
Mutual funds | ||
Estimated fair value | $ 69.5 | $ 88.3 |
Prepaid Expenses and Other Cu_3
Prepaid Expenses and Other Current Assets (Details) - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 |
Prepaid Expenses And Other Current Assets | ||
Prepaid manufacturing expense | $ 580,930 | $ 563,280 |
Prepaid insurance | 418,974 | 704,650 |
Prepaid preclinical and clinical expenses | 887,121 | 1,158,560 |
Other prepaid expenses and current assets | 477,893 | 460,030 |
Prepaid expenses and other current assets | $ 2,364,918 | $ 2,886,520 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2022 | Mar. 31, 2021 | Dec. 31, 2021 | |
Property and Equipment | |||
Total | $ 4,752,962 | $ 3,662,215 | |
Accumulated depreciation | (1,654,297) | (1,503,736) | |
Property and equipment, net | 3,098,665 | 2,158,479 | |
Depreciation expense | $ 150,562 | $ 72,078 | |
Minimum | |||
Property and Equipment | |||
Estimated useful lives | 3 years | ||
Maximum | |||
Property and Equipment | |||
Estimated useful lives | 8 years | ||
Lab equipment | |||
Property and Equipment | |||
Total | $ 3,483,311 | 3,178,855 | |
Computers | |||
Property and Equipment | |||
Total | 85,070 | 85,071 | |
Furniture and fixtures | |||
Property and Equipment | |||
Total | 66,106 | 66,106 | |
Leasehold Improvements | |||
Property and Equipment | |||
Total | 22,563 | 22,563 | |
Construction in progress | |||
Property and Equipment | |||
Total | $ 1,095,912 | $ 309,620 |
In-Process R&D (Details)
In-Process R&D (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2022 | Dec. 31, 2021 | Mar. 31, 2021 | Dec. 31, 2017 | |
Goodwill and In-Process R&D | ||||
Balance of finite-lived intangible assets | $ 3,500,000 | $ 3,500,000 | ||
In-process R&D. | ||||
Goodwill and In-Process R&D | ||||
Balance of finite-lived intangible assets | 5,900,000 | |||
Intangible assets fair value | 3,500,000 | |||
Impairment expense | $ 0 | $ 2,400,000 | $ 0 | |
Pelican Therapeutics, Inc. | In-process R&D. | ||||
Goodwill and In-Process R&D | ||||
Finite-lived intangible assets acquired | $ 5,900,000 |
Accrued Expenses and Other Li_3
Accrued Expenses and Other Liabilities (Details) - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 |
Accrued Expenses and Other Liabilities | ||
Accrued preclinical and clinical trial expenses | $ 794,010 | $ 955,013 |
Other expenses | 286,190 | 631,312 |
Accrued franchise tax | 229,363 | 195,000 |
Compensation and related benefits | 205,148 | 459,178 |
Accrued manufacturing expenses | 129,489 | 179,173 |
Accrued expenses | $ 1,644,200 | $ 2,419,676 |
Stockholders' Equity - ATM Offe
Stockholders' Equity - ATM Offerings (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Proceeds from the issuance of common stock | $ 26,304,282 | |
Payments of Stock Issuance Costs | $ 658,184 | |
At The Market Offering | ||
Issuance of common stock (in shares) | 0 | 2,106,027 |
Average price of common stock | $ 12.18 | |
Proceeds from the issuance of common stock | $ 25,646,099 | |
Percentage of commission for common stock sold | 3.00% |
Stockholders' Equity - Changes
Stockholders' Equity - Changes in Outstanding Warrants (Details) - Common stock warrants - $ / shares | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2022 | |
Stockholders' Equity | ||
Warrants to purchase common stock | 747,383 | 747,383 |
Weighted-average exercise price | $ 11.06 | $ 11.06 |
Outstanding, beginning balance | 758,939 | |
Issued | 31,000 | |
Expired | (42,556) | |
Outstanding, ending balance | 747,383 |
Stockholders' Equity - Equity C
Stockholders' Equity - Equity Compensation Plan - Narrative (Details) - shares | Aug. 02, 2021 | Mar. 31, 2022 |
Stockholders' Equity | ||
Granted | 78,250 | |
Forfeited | 28,109 | |
Subsidiaries Stock Incentive Plan | Abacus Biotech, Inc. | ||
Stockholders' Equity | ||
Granted | 10,526 | |
Subsidiaries Stock Incentive Plan | CEO | Skunkworx Bio, Inc. | ||
Stockholders' Equity | ||
Granted | 10,526 | |
Subsidiaries Stock Incentive Plan | CEO | Scorpion Biological Services, Inc. | ||
Stockholders' Equity | ||
Granted | 10,638 | |
Subsidiaries Stock Incentive Plan | CEO | Blackhawk Bio Inc. | ||
Stockholders' Equity | ||
Granted | 10,526 | |
Subsidiaries Stock Incentive Plan | CFO | ||
Stockholders' Equity | ||
Granted | 2,127 |
Stockholders' Equity - Accounti
Stockholders' Equity - Accounting for Stock-Based Compensation (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Stockholders' Equity | ||
Stock-based compensation | $ 909,983 | $ 2,897,580 |
Compensation expenses capitalized | $ 0 | $ 0 |
Employee stock options | ||
Stockholders' Equity | ||
Vesting period | 4 years | |
Expiration term | 10 years | 10 years |
Employee stock options | Maximum | ||
Stockholders' Equity | ||
Expiration term | 10 years |
Stockholders' Equity - Stock Op
Stockholders' Equity - Stock Option Valuation Assumptions (Details) - $ / shares | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Stockholders' Equity | ||
Dividend yield | 0.00% | 0.00% |
Expected volatility | 103.82% | 101.43% |
Risk-free interest rate | 1.95% | 0.43% |
Expected lives (years) | 6 years 1 month 6 days | 5 years 6 months |
Exercise price | $ 2.32 | $ 4.36 |
Stockholders' Equity - Stock _2
Stockholders' Equity - Stock Option Activity (Details) | 3 Months Ended |
Mar. 31, 2022USD ($)$ / sharesshares | |
Shares | |
Stock options outstanding at beginning of period | shares | 2,954,315 |
Granted | shares | 78,250 |
Expired | shares | (542) |
Forfeited | shares | (28,109) |
Stock options outstanding at end of period | shares | 3,003,914 |
Stock options exercisable at end of period | shares | 1,356,824 |
Weighted Average Exercise Price | |
Stock options outstanding at beginning of period (in dollars per share) | $ / shares | $ 7.62 |
Granted (in dollars per share) | $ / shares | 2.86 |
Expired (in dollars per share) | $ / shares | 60.90 |
Forfeited | $ / shares | 4.91 |
Stock options outstanding at end of period (in dollars per share) | $ / shares | 7.52 |
Stock options exercisable at end of period | $ / shares | $ 11.10 |
Aggregate Intrinsic Value | |
Stock options outstanding at beginning of period | $ | $ 101,306 |
Stock options outstanding at end of period | $ | 116,956 |
Stock options exercisable at end of period | $ | $ 62,432 |
Weighted Average Remaining Contractual Life | |
Stock options outstanding at end of period | 8 years 8 months 12 days |
Stock options exercisable at end of period | 8 years |
Unrecognized stock-based compensation expense | $ | $ 5,200,000 |
Unrecognized stock-based compensation expense, recognition period | 1 year 6 months |
Stockholders' Equity - Restrict
Stockholders' Equity - Restricted Stock (Details) | 3 Months Ended |
Mar. 31, 2022$ / sharesshares | |
Restricted stock | |
Shares | |
Restricted stock at beginning of period | 370,170 |
Vested | (323,311) |
Restricted stock at end of period | 46,859 |
Weighted Average Fair Value | |
Restricted stock at beginning of period | $ / shares | $ 4.71 |
Vested | $ / shares | 4.92 |
Restricted stock at end of period | $ / shares | $ 3.28 |
RSU's | |
Shares | |
Restricted stock at beginning of period | 0 |
Restricted stock at end of period | 0 |
RSU's | Vest on grant date | |
Stockholders' Equity | |
Vesting percentage | 25.00% |
RSU's | Vest on each anniversary thereafter | |
Stockholders' Equity | |
Vesting percentage | 25.00% |
Grant Revenue (Details)
Grant Revenue (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 70 Months Ended | ||||||
Dec. 31, 2019 | Oct. 31, 2017 | May 31, 2017 | Jun. 30, 2016 | May 31, 2016 | Mar. 31, 2022 | Mar. 31, 2021 | Mar. 31, 2022 | Dec. 31, 2021 | |
Grant Revenue | |||||||||
Revenue | $ 212,418 | $ 538,645 | |||||||
Grant receivable | 1,524,522 | $ 1,524,522 | $ 1,318,359 | ||||||
Pelican Therapeutics, Inc. | |||||||||
Grant Revenue | |||||||||
Amount awarded from CPRIT grant | $ 15,200,000 | ||||||||
Pelican Therapeutics, Inc. | Grant revenue | |||||||||
Grant Revenue | |||||||||
Revenue | 15,200,000 | ||||||||
Remaining grant amount receivable | 1,500,000 | 1,500,000 | |||||||
Amount the company is required to match of each dollar of grant | 0.50 | 0.50 | |||||||
Threshold amount for match of grant | 1 | 1 | |||||||
Contribution to be made by Pelican | $ 7,600,000 | $ 7,600,000 | |||||||
Pelican Therapeutics, Inc. | Grant revenue | Maximum | |||||||||
Grant Revenue | |||||||||
Amount awarded from CPRIT grant | $ 15,200,000 | ||||||||
Royalty percentage after threshold is met | 1.00% | ||||||||
Pelican Therapeutics, Inc. | Grant revenue | Tranche 1 | |||||||||
Grant Revenue | |||||||||
Revenue | $ 1,800,000 | ||||||||
Pelican Therapeutics, Inc. | Grant revenue | Tranche 2 | |||||||||
Grant Revenue | |||||||||
Revenue | $ 6,500,000 | ||||||||
Pelican Therapeutics, Inc. | Grant revenue | Tranche 3 | |||||||||
Grant Revenue | |||||||||
Revenue | $ 5,400,000 |
Net Loss Per Share - Reconcilia
Net Loss Per Share - Reconciliation of Net Loss (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Net Loss Per Share | ||
Net loss | $ (8,189,798) | $ (7,623,140) |
Net loss: Non-controlling interest | (69,211) | (90,962) |
Net loss attributable to Heat Biologics, Inc. | $ (8,120,587) | $ (7,532,178) |
Weighted-average common shares outstanding, basic (in shares) | 25,593,948 | 24,199,916 |
Weighted-average common shares outstanding, diluted (in shares) | 25,593,948 | 24,199,916 |
Net loss per share, basic (in dollars per share) | $ (0.32) | $ (0.31) |
Net loss per share, diluted (in dollars per share) | $ (0.32) | $ (0.31) |
Net Loss Per Share - Antidiluti
Net Loss Per Share - Antidilutive Securities (Details) - shares | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Employee stock options | ||
Net Loss Per Share | ||
Potentially dilutive securities | 3,003,914 | 1,697,910 |
Restricted stock subject to forfeiture and restricted stock units | ||
Net Loss Per Share | ||
Potentially dilutive securities | 46,859 | 259,874 |
Common stock warrants | ||
Net Loss Per Share | ||
Potentially dilutive securities | 747,383 | 747,383 |
Income Tax (Details)
Income Tax (Details) | 3 Months Ended | ||
Mar. 31, 2022USD ($) | Sep. 30, 2021USD ($)item | Dec. 31, 2021USD ($) | |
Income Tax | |||
Unrecognized tax benefit | $ 0 | $ 0 | |
Unrecognized income tax benefits impact on effective income tax rate | 0 | 0 | |
Accrual for interest and penalties relating to uncertain income tax positions | 0 | $ 0 | |
Deferred income tax benefit | 600,000 | ||
Number of ownership changes over 50% | item | 5 | ||
Federal | |||
Income Tax | |||
Net operating loss carryforwards | 153,477,285 | ||
NOLs that will expire unutilized | $ 58,182,000 | ||
R&D credits that will expire unutilized | $ 2,935,000 | ||
Federal | Pelican Therapeutics, Inc. | |||
Income Tax | |||
Net operating loss carryforwards | $ 3,027,284 |
Leases - Facility Lease (Detail
Leases - Facility Lease (Details) | 1 Months Ended | ||
Oct. 31, 2021USD ($)ft²item | Jun. 30, 2021USD ($)ft²item | Mar. 31, 2022USD ($) | |
Leases | |||
Minimum amount of undiscounted lease payments | $ 1,826,080 | ||
Morrisville, NC | |||
Leases | |||
Area of facility to be leased | ft² | 15,996 | ||
Lease term | 8 years | ||
Number of lease renewal terms | item | 1 | ||
Lease renewal term | 5 years | ||
Maximum amount of tenant improvements provided for under lease | $ 2,400,000 | ||
Minimum amount of undiscounted lease payments | $ 4,700,000 | ||
San Antonio, TX | |||
Leases | |||
Area of facility to be leased | ft² | 20,144 | ||
Reimbursement of expenses to lessor | $ 17,000,000 | ||
Lease term | 15 years | ||
Number of lease renewal terms | item | 1 | ||
Lease renewal term | 15 years | ||
Number of lease subsequent renewal terms | item | 1 | ||
Lease subsequent renewal term | 10 years | ||
Maximum amount of tenant improvements provided for under lease | $ 2,400,000 | ||
Minimum amount of undiscounted lease payments | $ 11,100,000 |
Leases - Lease Cost (Details)
Leases - Lease Cost (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Leases | ||
Operating lease payments | $ 100,000 | |
Effective interest rate | 5.47% | |
Operating lease cost | $ 125,503 | $ 113,555 |
Finance lease cost | ||
Amortization of lease assets | 62,861 | 29,725 |
Interest on lease liabilities | 6,317 | 3,743 |
Lease cost | $ 69,178 | $ 33,468 |
Weighted average remaining lease term (years), Operating leases | 4 years 7 months 6 days | 6 years |
Weighted average remaining lease term (years), Finance leases | 1 year 10 months 24 days | 1 year 8 months 12 days |
Weighted average discount rate, Operating leases | 5.62% | 6.47% |
Weighted average discount rate, Finance leases | 5.47% | 6.17% |
Leases - Maturities of Operatin
Leases - Maturities of Operating and Finance Lease Liabilities (Details) | Mar. 31, 2022USD ($) |
Maturities of operating lease liabilities | |
2022 (excluding the three months ended March 31, 2022) | $ 378,343 |
2023 | 369,601 |
2024 | 308,183 |
2025 | 315,132 |
2026 | 245,607 |
2027 | 209,214 |
Total minimum lease payments | 1,826,080 |
Less: imputed interest | (222,023) |
Present value of operating lease liabilities | 1,604,057 |
Maturities of finance lease liabilities | |
2022 (excluding the three months ended March 31, 2022) | 281,042 |
2023 | 135,632 |
2024 | 131,256 |
Total minimum lease payments | 547,930 |
Less: imputed interest | (87,118) |
Present value of lease liabilities | 460,812 |
Maturities of lease liabilities | |
2022 (excluding the three months ended March 31, 2022) | 659,385 |
2023 | 505,233 |
2024 | 439,439 |
2025 | 315,132 |
2026 | 245,607 |
2027 | 209,214 |
Total minimum lease payments | 2,374,010 |
Less: imputed interest | (309,141) |
Present value of lease liabilities | $ 2,064,869 |
Subsequent Events (Details)
Subsequent Events (Details) - Subsequent Events | Apr. 18, 2022USD ($)ft² |
Minimum | Scorpion Biological Services, Inc. | |
Subsequent Events | |
Cost of development facility | $ 300,000,000 |
Area of facility to be leased | ft² | 500,000 |
Elusys Therapeutics, Inc. | |
Subsequent Events | |
Cash consideration | $ 3,000,000 |
Lease termination and employee severance payments consideration | $ 867,646 |
Percentage of lease termination and employee severance payments | 50.00% |
Earn out payments consideration | $ 2,000,000 |
Earn out payments period | 12 years |
Percentage of earn out payments | 10.00% |
Frequency of periodic earn out payment | 1 year |
Period of occurrence of earn payment | 9 years |