Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jul. 31, 2016 | Aug. 31, 2016 | |
Document And Entity Information | ||
Entity Registrant Name | BioPharmX Corp | |
Entity Central Index Key | 1,504,167 | |
Document Type | S-1/A | |
Document Period End Date | Jul. 31, 2016 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --01-31 | |
Is Entity's Reporting Status Current? | Yes | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 31,175,582 | |
Document Fiscal Year Focus | 2,017 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Jul. 31, 2016 | Jan. 31, 2016 | Jul. 31, 2015 | Jan. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Current assets: | ||||||
Cash and cash equivalents | $ 436,000 | $ 4,039,000 | $ 7,388,000 | $ 1,305,000 | $ 2,111,000 | $ 3,000 |
Accounts receivable, net | 1,000 | 7,000 | 1,000 | |||
Inventories | 112,000 | 100,000 | 160,000 | |||
Prepaid expenses and other current assets | 475,000 | 285,000 | 239,000 | |||
Total current assets | 1,024,000 | 4,431,000 | 1,705,000 | |||
Property and equipment, net | 204,000 | 216,000 | 234,000 | |||
Intangible assets, net | 104,000 | 119,000 | 149,000 | |||
Other assets | 50,000 | 50,000 | 50,000 | |||
Restricted cash | 35,000 | 35,000 | ||||
Total assets | 1,382,000 | 4,851,000 | 2,173,000 | |||
Current liabilities: | ||||||
Accounts payable | 3,416,000 | 1,777,000 | 1,152,000 | |||
Accrued liabilities and other current liabilities | 795,000 | 187,000 | ||||
Related party payables | 104,000 | 225,000 | 218,000 | |||
Total current liabilities | 4,518,000 | 2,797,000 | 1,557,000 | |||
Commitments and contingencies (Note 5) | ||||||
Stockholders' equity (deficit): | ||||||
Common stock, $0.001 par value; 90,000,000 shares authorized; 25,208,684 and 11,415,416 shares issued and outstanding as of January 31, 2016 and 2015, respectively | 29,000 | 25,000 | 11,000 | |||
Additional paid in capital | 32,562,000 | 28,261,000 | 4,416,000 | |||
Accumulated deficit | (35,727,000) | (26,232,000) | (10,634,000) | |||
Total stockholders' equity (deficit) | (3,136,000) | 2,054,000 | (6,207,000) | (5,107,000) | $ (1,370,000) | |
Total liabilities, convertible redeemable preferred stock and stockholders' equity (deficit) | 1,382,000 | 4,851,000 | 2,173,000 | |||
Series A Convertible Redeemable Preferred Stock | ||||||
Current liabilities: | ||||||
Series A convertible redeemable preferred stock, $0.001 par value; 10,000,000 shares authorized; none issued and outstanding as of January 31, 2016 and 4,207,987 issued and outstanding as of January 31, 2015 (liquidation preference of $8.0 million as of January 31, 2015) | $ 6,823,000 | $ 6,730,000 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Millions | Jan. 31, 2016 | Jan. 31, 2015 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 90,000,000 | 90,000,000 |
Common stock, issued | 25,208,684 | 11,415,416 |
Common stock, shares outstanding | 25,208,684 | 11,415,416 |
Series A Convertible Redeemable Preferred Stock | ||
Par value (in dollars per share) | $ 0.001 | $ 0.001 |
Shares authorized | 10,000,000 | 10,000,000 |
Shares issued | 0 | 4,207,987 |
Shares outstanding | 0 | 4,207,987 |
Liquidation preference | $ 8 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Jan. 31, 2015 | Jul. 31, 2016 | Jul. 31, 2015 | Jul. 31, 2016 | Jul. 31, 2015 | Jan. 31, 2016 | Dec. 31, 2014 | |
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS | |||||||
Revenues, net | $ 1 | $ 19 | $ 5 | $ 52 | $ 9 | $ 64 | |
Cost of goods sold | 1 | 17 | 10 | 37 | 19 | 237 | |
Gross deficit | 2 | (5) | 15 | (10) | (173) | ||
Operating expenses: | |||||||
Research and development | 365 | 2,973 | 1,141 | 5,146 | 2,217 | 5,702 | $ 2,519 |
Sales and marketing | 378 | 895 | 1,307 | 2,002 | 2,388 | 5,109 | 2,299 |
General and administrative | 401 | 1,169 | 1,118 | 2,362 | 2,144 | 4,174 | 2,953 |
Total operating expenses | 1,144 | 5,037 | 3,566 | 9,510 | 6,749 | 14,985 | 7,771 |
Loss from operations | (1,144) | (5,035) | (3,571) | (9,495) | (6,759) | (15,158) | (7,771) |
Other income (expense), net | 1 | 2 | (436) | (436) | 40 | ||
Loss before income taxes | (1,144) | (5,034) | (3,571) | (9,493) | (7,195) | (15,594) | (7,807) |
Interest expense | (76) | ||||||
Provision for income taxes | 2 | 4 | |||||
Net and comprehensive loss | (1,144) | (5,034) | (3,571) | (9,495) | (7,195) | (15,598) | (7,807) |
Accretion on Series A convertible redeemable preferred stock | (43) | (79) | (202) | (202) | (163) | ||
Deemed dividend on Series A convertible redeemable preferred stock | (50) | (85) | (201) | (201) | (159) | ||
Net loss available to common stockholders | $ (1,237) | $ (5,034) | $ (3,735) | $ (9,495) | $ (7,598) | $ (16,001) | $ (8,129) |
Basic and diluted net loss available to common stockholders per share | $ (0.11) | $ (0.18) | $ (0.24) | $ (0.35) | $ (0.56) | $ (0.89) | $ (0.80) |
Shares used in computing basic and diluted net loss per share | 11,408,000 | 28,674,000 | 15,443,000 | 27,459,000 | 13,616,000 | 17,950,000 | 10,217,000 |
CONSOLIDATED STATEMENTS OF CONV
CONSOLIDATED STATEMENTS OF CONVERTIBLE REDEEMABLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY (DEFICIT) - USD ($) $ in Thousands | Common Stock | Additional Paid-In Capital | Accumulated Deficit | Series A Convertible Redeemable Preferred Stock | Total |
Increase (decrease) in convertible redeemable preferred stock | |||||
Issuance of preferred stock, related warrants and common stock | $ 6,408 | ||||
Issuance of preferred stock, related warrants and common stock, shares | 4,207,987 | ||||
Interest on preferred stock | $ (159) | $ 159 | $ (159) | ||
Accretion of stock issuance costs | (163) | 163 | (163) | ||
Balance Ending, Amount at Dec. 31, 2014 | $ 6,730 | ||||
Balance Ending, Shares at Dec. 31, 2014 | 4,207,987 | ||||
Balance Beginning, Amount at Dec. 31, 2013 | $ 7 | 306 | $ (1,683) | (1,370) | |
Balance Beginning, Shares at Dec. 31, 2013 | 7,025,000 | ||||
Increase (decrease) in stockholders' deficit | |||||
Thompson Designs, Inc. common stock assumed in conjunction with Share Exchange | $ 2 | (2) | |||
Thompson Designs, Inc. common stock assumed in conjunction with Share Exchange (in shares) | 2,000,000 | ||||
Issuance of common stock due to exercise of options | $ 1 | 98 | 99 | ||
Issuance of common stock due to exercise of options (in shares) | 824,310 | ||||
Issuance of convertible notes payable | 204 | 204 | |||
Issuance of warrants to non-employees | 204 | 204 | |||
Conversion of convertible notes payable to common stock | $ 1 | 1,846 | 1,847 | ||
Conversion of convertible notes payable to common stock (in shares) | 1,526,001 | ||||
Stock-based compensation | 1,193 | 1,193 | |||
Issuance of preferred stock, related warrants and common stock | 845 | 845 | |||
Interest on preferred stock | (159) | $ 159 | (159) | ||
Accretion of stock issuance costs | (163) | 163 | (163) | ||
Net and comprehensive loss | (7,807) | (7,807) | |||
Balance Ending, Amount at Dec. 31, 2014 | $ 11 | 4,372 | (9,490) | (5,107) | |
Balance Ending, Shares at Dec. 31, 2014 | 11,375,311 | ||||
Increase (decrease) in convertible redeemable preferred stock | |||||
Interest on preferred stock | (50) | 50 | (50) | ||
Accretion of stock issuance costs | (43) | 43 | (43) | ||
Balance Ending, Amount at Jan. 31, 2015 | $ 6,823 | ||||
Balance Ending, Shares at Jan. 31, 2015 | 4,207,987 | ||||
Increase (decrease) in stockholders' deficit | |||||
Issuance of common stock due to exercise of options | 38 | 38 | |||
Issuance of common stock due to exercise of options (in shares) | 40,105 | ||||
Stock-based compensation | 99 | 99 | |||
Interest on preferred stock | (50) | $ 50 | (50) | ||
Accretion of stock issuance costs | (43) | 43 | (43) | ||
Net and comprehensive loss | (1,144) | (1,144) | |||
Balance Ending, Amount at Jan. 31, 2015 | $ 11 | 4,416 | (10,634) | (6,207) | |
Balance Ending, Shares at Jan. 31, 2015 | 11,415,416 | ||||
Increase (decrease) in convertible redeemable preferred stock | |||||
Issuance of common stock, net of expenses of $2,500 | $ (7,226) | (7,226) | |||
Issuance of common stock, net of expenses of $2,500 (in shares) | (4,207,987) | ||||
Interest on preferred stock | (201) | $ 201 | (201) | ||
Accretion of stock issuance costs | (202) | 202 | (202) | ||
Balance Ending, Amount at Jan. 31, 2016 | |||||
Balance Ending, Shares at Jan. 31, 2016 | 0 | ||||
Increase (decrease) in stockholders' deficit | |||||
Issuance of common stock, net of expenses of $2,500 | $ 12 | 20,530 | 20,542 | ||
Issuance of common stock, net of expenses of $2,500 (in shares) | 12,508,395 | ||||
Issuance of common stock due to exercise of options | $ 1 | 82 | 83 | ||
Issuance of common stock due to exercise of options (in shares) | 666,157 | ||||
Issuance of common stock due to exercise of warrants | $ 1 | 1,486 | 1,487 | ||
Issuance of common stock due to exercise of warrants (in shares) | 618,716 | ||||
Expense related to the modification of warrants | 436 | 436 | |||
Issuance of convertible notes payable | 500 | 500 | |||
Stock-based compensation | 1,214 | 1,214 | |||
Interest on preferred stock | (201) | $ 201 | (201) | ||
Accretion of stock issuance costs | (202) | 202 | (202) | ||
Net and comprehensive loss | (15,598) | (15,598) | |||
Balance Ending, Amount at Jan. 31, 2016 | $ 25 | $ 28,261 | $ (26,232) | 2,054 | |
Balance Ending, Shares at Jan. 31, 2016 | 25,208,684 | ||||
Balance Ending, Amount at Jul. 31, 2016 | |||||
Balance Ending, Shares at Jul. 31, 2016 | 0 | ||||
Increase (decrease) in stockholders' deficit | |||||
Net and comprehensive loss | (9,495) | ||||
Balance Ending, Amount at Jul. 31, 2016 | $ (3,136) |
CONSOLIDATED STATEMENTS OF CON6
CONSOLIDATED STATEMENTS OF CONVERTIBLE REDEEMABLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY (DEFICIT) (Parenthetical) $ in Thousands | 12 Months Ended |
Jan. 31, 2016USD ($) | |
Common Stock | |
Issuance costs | $ 2,500 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | |
Jan. 31, 2016 | Dec. 31, 2014 | |
Cash flows from operating activities: | ||
Net loss | $ (15,598,000) | $ (7,807,000) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Stock-based compensation expense | 1,214,000 | 1,193,000 |
Expense related to modification of warrants | 436,000 | |
Depreciation expense | 56,000 | 25,000 |
Amortization expense | 30,000 | 0 |
Warrants issued for services provided | 99,000 | |
Noncash interest expense | 76,000 | |
Changes in assets and liabilities: | ||
Accounts receivable | (6,000) | (2,000) |
Inventories | 60,000 | (138,000) |
Prepaid expenses and other assets | (46,000) | (133,000) |
Accounts payable | 625,000 | 257,000 |
Accrued expenses and other liabilities | 608,000 | 355,000 |
Related party payables | 7,000 | 74,000 |
Net cash used in operating activities | (12,614,000) | (6,001,000) |
Cash flows from investing activities: | ||
Change in restricted cash | (35,000) | |
Purchases of property and equipment | (38,000) | (228,000) |
Net cash used in investing activities | (38,000) | (263,000) |
Cash flows from financing activities: | ||
Proceeds from the issuance of common stock, net of $2,500 issuance costs | 13,316,000 | |
Proceeds from exercises of stock options | 83,000 | 99,000 |
Proceeds from exercise of common stock warrants | 1,487,000 | |
Net proceeds from issuance of convertible redeemable preferred stock and common stock warrants | 7,253,000 | |
Proceeds from issuance of convertible notes payable | 500,000 | 1,020,000 |
Net cash provided by financing activities | 15,386,000 | 8,372,000 |
Net increase (decrease) in cash and cash equivalents | 2,734,000 | 2,108,000 |
Cash and cash equivalents at beginning of year | 1,305,000 | 3,000 |
Cash and cash equivalents at end of year | 4,039,000 | 2,111,000 |
Non-cash investing and financing activities: | ||
Conversion of preferred stock to common stock | 7,226,000 | |
Conversion of convertible notes payable to common stock | 1,847,000 | |
Fair value of beneficial conversion feature issued in connection with convertible notes payable | 204,000 | |
Supplemental disclosures: | ||
Income taxes paid | $ 4,000 | |
Convertible Debt Warrant | ||
Non-cash investing and financing activities: | ||
Issuance of common stock warrants | $ 105,000 |
CONSOLIDATED STATEMENTS OF CAS8
CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) $ in Thousands | 12 Months Ended |
Jan. 31, 2016USD ($) | |
Common Stock | |
Issuance costs | $ 2,500 |
DESCRIPTION OF BUSINESS AND SUM
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended | 12 Months Ended |
Jul. 31, 2016 | Jan. 31, 2016 | |
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 1. DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Description of Business BioPharmX Corporation (the “Company”) is incorporated under the laws of the state of Delaware and originally incorporated on August 30, 2010 in Nevada under the name Thompson Designs, Inc. The Company has one wholly-owned subsidiary, BioPharmX, Inc., a Nevada corporation. The Company is a specialty pharmaceutical company focused on utilizing its proprietary drug delivery technologies to develop and commercialize novel prescription and over-the-counter, or OTC, products that address large markets in women’s health and dermatology. The Company’s objective is to develop products that treat health or age-related conditions that (1) are not presently being addressed or treated or (2) are currently treated with drug therapies or drug delivery approaches that are suboptimal. The Company’s strategy is designed to bring new products to market by identifying optimal delivery mechanisms and/or alternative applications for FDA-approved active pharmaceutical ingredients, or APIs, and biological materials, while in appropriate circumstances, reducing the time, cost and risk typically associated with new product development by repurposing drugs with demonstrated safety profiles and taking advantage of the regulatory approval pathway under Section 505(b)(2) of the Federal Food, Drug and Cosmetic Act available for repurposed/reformulated drugs. The Company believes the 505(b)(2) regulatory pathway may reduce drug development risk and could reduce the time and resources it spends during development. Since the Company’s inception, substantially all of the Company’s efforts have been devoted to developing its product candidates, including conducting preclinical and clinical trials, and providing general and administrative support for its operations. The Company commercially launched its breast health supplement at the end of 2014, although to-date the Company has not generated significant revenue from product sales. The Company is not dependent on sales to any one customer. The Company has financed its operations primarily through the sale of equity and convertible debt securities. In June 2015, the Company raised $7.8 million through the sale of its common stock in a public offering and concurrently completed an uplisting to the NYSE MKT. In December 2015 the Company raised net proceeds of $5.5 million in a private offering of its common stock and, in April 2016, it raised net proceeds of approximately $3.6 million from an issuance of common stock and warrants to purchase common stock in a public offering. In August 2016, the Company raised net proceeds of approximately $1.4 million in a private offering of its common stock and $1.5 million through the sale of convertible promissory notes. Basis of Presentation and Principles of Consolidation These unaudited interim condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting and include the accounts of the Company and its subsidiary. Certain information and note disclosures normally included in the consolidated financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. Accordingly, these unaudited interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the year ended January 31, 2016, filed on May 2, 2016. The condensed consolidated balance sheet as of January 31, 2016, included herein, was derived from the audited consolidated financial statements as of that date. The unaudited interim condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary and have been prepared on the same basis as the audited consolidated financial statements and include all adjustments, consisting only of normal recurring adjustments, necessary for the fair presentation of the Company’s statement of financial position as of July 31, 2016 and January 31, 2016, and the Company’s results of operations and its cash flows for the three and six months ended July 31, 2016 and 2015. The results for the three and six months ended July 31, 2016 are not necessarily indicative of the results to be expected for the year ending January 31, 2017 or any future period. Use of Estimates The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses recognized during the reported period. Actual results could differ from those estimates. Inventories Inventories are stated at the lower of cost or market. Cost is determined using the standard cost method which approximates actual cost on a first-in, first-out basis. Market value is determined as the lower of replacement cost or net realizable value. The Company regularly reviews inventory quantities in consideration of actual loss experiences, projected future demand and remaining shelf life to record a provision for excess and obsolete inventory when appropriate. Impairment of Long-Lived Assets The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset might not be recoverable. When such an event occurs, management determines whether there has been an impairment by comparing the anticipated undiscounted future net cash flows to the related asset’s carrying value. If an asset is considered impaired, the asset is written down to fair value, which is determined based either on discounted cash flows or appraised value, depending on the nature of the asset. The Company has not identified any such impairment losses to date. Advertising Expenses The Company expenses the costs of advertising, including promotional expenses, as incurred. Advertising expenses were approximately $59,000 and $313,000 for the three months ended July 31, 2016 and 2015, respectively. Advertising expenses were approximately $278,000 and $549,000 for the six months ended July 31, 2016 and 2015, respectively. Net Loss per Share Basic net loss per share attributable to common stockholders is calculated based on the weighted-average number of shares of the Company’s common stock outstanding during the period. The weighted average shares outstanding for the three and six months ended July 31, 2016 excludes 193,333 of unvested common stock. Diluted net loss per share attributable to common stockholders is calculated based on the weighted-average number of shares of the Company’s common stock outstanding and other dilutive securities outstanding during the period. The potential dilutive shares of common stock resulting from the assumed exercise of outstanding stock options, warrants and the assumed conversion of preferred stock are determined under the treasury stock method. For the three months ended July 31, 2016 and 2015, approximately 10,002,000 and 4,837,000 potentially dilutive securities, respectively, were excluded from the computation of diluted loss per share because their effect on net loss per share would be anti-dilutive. Summary of Significant Accounting Policies These unaudited interim condensed consolidated financial statements and accompanying notes should be read in conjunction with the Company’s annual financial statements and notes thereto contained in the Annual Report on Form 10-K for the fiscal year ended January 31, 2016. There have been no significant changes in the Company’s significant accounting policies for the three months ended July 31, 2016, as compared to the significant accounting policies described in the Annual Report on Form 10-K for the fiscal year ended January 31, 2016. Recent Accounting Pronouncements In February 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2016-02, Leases, which requires entities to recognize assets and liabilities for leases with lease terms greater than twelve months. The new guidance also requires quantitative and qualitative disclosures regarding the amount, timing and uncertainty of cash flows arising from leases. The standard is effective for annual and interim periods beginning after December 15, 2018, with early adoption permitted upon issuance. The Company is in the process of evaluating the impact of adoption on its consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-09, Compensation — Stock Compensation: Improvements to Employee Share-Based Payment Accounting, which relates to the accounting for employee share-based payments. This standard provides guidance on simplifying several aspects of the accounting for employee share-based payment transactions, including the income tax consequences, accounting for forfeitures and classification of excess tax benefits on the statement of cash flows. This standard will be effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. The Company is in the process of evaluating the impact of adoption on its consolidated financial statements. In April 2016, the FASB issued ASU No. 2016-10, Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing, which addresses certain implementation issues that have surfaced since the issuance of ASU No. 2014-09 in May 2014. ASU No. 2016-10 provides guidance in identifying performance obligations and determining the appropriate accounting for licensing arrangements. This standard will be effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company is in the process of evaluating the impact of adoption on its consolidated financial statements. In May 2016, the FASB issued ASU No. 2016-12, Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients. ASU No. 2016-12 will affect all entities that enter into contracts with customers to transfer goods or services that are an output of the entity’s ordinary activities in exchange for consideration. The amendments in this update affect the guidance in ASU No. 2014-09 which is not yet effective. The amendments in this update also affect narrow aspects of Topic 606 including among others: assessing collectability criterion, noncash consideration, and presentation of sales taxes and other similar taxes collected from customers. The effective date of this update is the same as ASU No. 2014-09. The Company is in the process of evaluating the impact of adoption on its consolidated financial statements. | 1. DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Description of Business BioPharmX Corporation (the "Company") is incorporated under the laws of the state of Delaware and originally incorporated on August 30, 2010 in Nevada under the name Thompson Designs, Inc. The Company has one wholly-owned subsidiary, BioPharmX, Inc., a Nevada corporation. The Company is a specialty pharmaceutical company focused on utilizing its proprietary drug delivery technologies to develop and commercialize novel prescription and over-the-counter, or OTC, products that address large markets in women's health and dermatology. The Company's objective is to develop products that treat health or age-related conditions that (1) are not presently being addressed or treated or (2) are currently treated with drug therapies or drug delivery approaches that are suboptimal. The Company's strategy is designed to bring new products to market by identifying optimal delivery mechanisms and/or alternative applications for FDA-approved active pharmaceutical ingredients, or APIs, while in appropriate circumstances, reducing the time, cost and risk typically associated with new product development by repurposing drugs with demonstrated safety profiles, taking advantage of the regulatory approval pathway under Section 505(b)(2) of the Federal Food, Drug and Cosmetic Act available for repurposed/reformulated drugs. The Company believes the 505(b)(2) regulatory pathway may reduce drug development risk and could reduce the time and resources it spends during development. Since the Company's inception, substantially all of the Company's efforts have been devoted to developing its product candidates, including conducting preclinical and clinical trials, and providing general and administrative support for its operations. The Company commercially launched its breast health supplement at the end of 2014, although to-date the Company has not generated significant revenue from product sales. The Company is not dependent on sales to any one customer. The Company has financed its operations primarily through the sale of equity and convertible debt securities. In June 2015, the Company raised $7.8 million through the sale of its common stock in a public offering and concurrently completed an uplisting to the NYSE MKT. In December 2015 we raised net proceeds of $5.5 million in a private offering of our common stock and, in April 2016, we raised net proceeds of approximately $3.6 million from an issuance of common stock and warrants to purchase common stock in a public offering. Share Exchange On January 23, 2014, the Company (then operating as Thompson Designs, Inc.), BioPharmX, Inc. and stockholders of BioPharmX, Inc., who collectively owned 100% of BioPharmX, Inc., entered into and consummated transactions pursuant to a share exchange agreement, such transaction referred to as the Share Exchange, whereby the Company issued to the stockholders of BioPharmX, Inc. an aggregate of 7,025,000 shares of its common stock, in exchange for 100% of the shares of BioPharmX, Inc. held by stockholders. The shares of the Company's common stock received by the stockholders of BioPharmX, Inc. in the Share Exchange constituted approximately 77.8% of its then issued and outstanding common stock, after giving effect to the issuance of shares pursuant to the share exchange agreement. As a result of the Share Exchange, BioPharmX, Inc. became the Company's wholly-owned subsidiary. For accounting purposes, the Share Exchange was treated as a reverse acquisition with BioPharmX, Inc. as the acquirer and the Company as the acquired party, and as a result the historical financial statements prior to the Share Exchange included in this Annual Report on Form 10-K are the historical financial statements of BioPharmX, Inc. On March 3, 2014, the Company changed its name to BioPharmX Corporation. On May 16, 2014, the Company reincorporated from Nevada to Delaware. Change in Fiscal Year End On March 26, 2015, the board of directors of the Company approved a change in its fiscal year end from December 31 to January 31. Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America ("GAAP"). The accompanying financial statements include the accounts of BioPharmX and its wholly-owned subsidiary. All intercompany transactions have been eliminated in consolidation. Use of Estimates The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses recognized during the reported period. Actual results could differ from those estimates. Reclassification Certain prior year amounts have been reclassified to conform to the current year presentation. Deferred rent, accrued payroll and deferred revenue have been included in accrued liabilities and other current liabilities. The amounts for the prior periods have been reclassified to be consistent with the current year presentation and have no impact on previously reported total assets, total stockholders' deficit or net loss. Fair Value Measurements The Company recognizes and discloses the fair value of its assets and liabilities using a hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to valuations based upon unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to valuations based upon unobservable inputs that are significant to the valuation (Level 3 measurements). Each level of input has different levels of subjectivity and difficulty involved in determining fair value. • Level 1—Inputs used to measure fair value are unadjusted quoted prices that are available in active markets for the identical assets or liabilities as of the reporting date. • Level 2—Observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities 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 asset or liability. • Level 3—Unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities. As of January 31, 2016, the Company held $3.6 million in money market funds, which are classified as Level 1 within the fair value hierarchy. No unrealized gains or losses are recorded in connection with these amounts. Accounts Receivable Accounts receivable is recorded net of cash discounts for prompt payment and return allowances. There was no allowance for doubtful accounts receivable recorded at either January 31, 2016 or 2015. Inventories Inventories are stated at the lower of cost or market. Cost is determined using the standard cost method which approximates actual cost on a first-in, first-out basis. Market value is determined as the lower of replacement cost or net realizable value. The Company regularly reviews inventory quantities in consideration of actual loss experiences, projected future demand and remaining shelf life to record a provision for excess and obsolete inventory when appropriate. Fair Value of Financial Instruments Carrying amounts of certain of the Company's financial instruments, including cash and cash equivalents, prepaid and other current assets, accounts payable, accrued expenses and other liabilities and related party payables approximate fair value due to their short maturities. Property and Equipment Property, plant and equipment is stated at cost less accumulated depreciation and amortization. Depreciation and amortization are recognized using the straight-line method. Repairs and maintenance costs are expensed as incurred. Estimated useful lives in years are as follows: Description Estimated Useful Life Furniture 5 - 7 Laboratory equipment 3 - 5 Computer and equipment 3 - 5 Software 5 Intangible Assets Intangible assets with finite useful lives are amortized over their estimated useful lives. Intangible assets with finite useful lives are reviewed for impairment when facts or circumstances suggest that the carrying value of these assets may not be recoverable. The intangible assets were acquired in March 2013 in connection with the collaboration and license agreement with Iogen detailed in Note 5. Amortization of the intangible assets commenced in January 2015 with the first recognition of revenue related to VI 2 OLET and is being taken on a straight-line basis over 5 years. Impairment of Long-Lived Assets The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset might not be recoverable. When such an event occurs, management determines whether there has been an impairment by comparing the anticipated undiscounted future net cash flows to the related asset's carrying value. If an asset is considered impaired, the asset is written down to fair value, which is determined based either on discounted cash flows or appraised value, depending on the nature of the asset. The Company has not identified any such impairment losses to date. Restricted Cash The Company has restricted cash in the amount of $35,000 held in a money market account to secure the credit line of the Company's credit cards. Revenue Recognition VI 2 OLET is a new product in the dietary supplement field. Revenue is recognized provided that persuasive evidence of a sales arrangement exists, the price is fixed or determinable, title and risk of loss has transferred, calculability of the resulting receivable is reasonably assured, there are no customer acceptance requirements and we do not have any significant post-shipment obligations. The Company recognizes revenue on a sell-through basis for customer arrangements in which it does not have historical information to estimate product returns, pricing discounts or other concessions upon shipment. For these product shipments, the Company invoices the reseller, records deferred revenue at the gross invoice sales price and classifies the cost basis of the product held by the wholesaler as a component of inventory. Deferred revenue is adjusted for price protection and other revenue reserves. Revenue is recognized when product is sold by the reseller to the end user, on a first-in first-out (FIFO) basis. For customer arrangements in which returns, price discounts and other concessions can be reasonably estimated, revenue is recognized upon shipment and a reserve is recorded for returns, price discounts and other concessions. Cost of Good Sold Costs of good sold includes direct costs related to the sale of the Company's iodine dietary supplement, write-downs of excess and obsolete inventories, and amortization of intangible assets. Shipping and Handling Costs Shipping and handling costs are expensed as incurred and are included in cost of goods sold. Research and Development Expenses Research and development expenses are expensed as incurred and consist primarily of personnel costs, including salaries, benefits and stock-based compensation, clinical studies performed by contract research organizations ("CROs"), consulting, materials, supplies, and facilities and other overhead allocations. Advertising Expenses The Company expenses the costs of advertising, including promotional expenses, as incurred. Advertising expenses were $1.2 million for year ended January 31, 2016, $90,000 for the one month ended January 31, 2015 and $68,000 for the year ended December 31, 2014. Income Taxes The Company accounts for income taxes using the liability method whereby deferred tax asset and liability account balances are determined based on differences between financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. Valuation allowances are established to reduce deferred tax assets when management estimates, based on available objective evidence, that it is more likely than not that the benefit will not be realized for the deferred tax assets. The Company's policy is to recognize interest and penalties accrued on any unrecognized tax benefits as a component of income tax expense. No interest expense was recognized during the periods presented. Stock-Based Compensation The Company recognizes stock-based compensation for equity awards on a straight-line basis over their vesting periods based on the grant date fair value. The Company estimates the fair value of stock options granted using the Black-Scholes pricing model. This model also requires subjective assumptions, including future stock price volatility and expected time to exercise, which greatly affect the calculated values. Equity instruments issued to non-employees are recorded at their fair value on the measurement date and are subject to periodic adjustment as the underlying equity instruments vest. Comprehensive Loss Comprehensive loss is the change in equity of an enterprise, except those resulting from stockholder transactions. Accordingly, comprehensive loss includes certain changes in equity that are excluded from net loss. For the year ended January 31, 2016, one month ended January 31, 2015 and year ended December 31, 2014, the Company's comprehensive loss is equal to net loss. There were no components of other comprehensive loss for any of the periods presented. Net Loss Per Share Basic net loss per share attributable to common stockholders is calculated based on the weighted-average number of shares of the Company's common stock outstanding during the period. Diluted net loss per share attributable to common stockholders is calculated based on the weighted-average number of shares of the Company's common stock outstanding and other dilutive securities outstanding during the period. The potential dilutive shares of common stock resulting from the assumed exercise of outstanding stock options, warrants and the assumed conversion of preferred stock are determined under the treasury stock method. As of January 31, 2016, January 31, 2015 and December 31, 2014, 5,741,000, 9,793,000 and 9,713,000 potentially dilutive securities, respectively, were excluded from the computation of diluted loss per share because their effect on net loss per share would be anti-dilutive. Recent Accounting Pronouncements In July 2015, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2015-11, Inventory (Topic 330), Simplifying the Measurement of Inventory, which applies to all inventory except that which is measured using last-in, first-out (LIFO) or the retail inventory method. Inventory measured using first-in, first-out (FIFO) or average cost is included in the new amendment. The amendment will take effect for public business entities for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. The Company is in the process of evaluating the impact of adoption on the its consolidated financial statements. In August 2015, FASB issued Accounting Standards Update No. 2015-14, Revenue from Contracts with Customers (ASU No. 2014-09). This update defers the effective dates of ASU No. 2014-09 (originally issued in June 2014) for public business entities by one year, or until annual reporting periods beginning after December 15, 2017, including interim reporting periods within the reporting period. ASU No. 2014-09 gives entities a single comprehensive model to use in reporting information about the amount and timing of revenue resulting from contracts to provide goods or services to customers. The proposed ASU, which would apply to any entity that enters into contracts to provide goods or services, would supersede the revenue recognition requirements in Topic 605, Revenue Recognition, and most industry-specific guidance throughout the Industry Topics of the Codification. Additionally, the update would supersede some cost guidance included in Subtopic 605-35, Revenue Recognition—Construction-Type and Production-Type Contracts. The update removes inconsistencies and weaknesses in revenue requirements and provides a more robust framework for addressing revenue issues and more useful information to users of financial statements through improved disclosure requirements. In addition, the update improves comparability of revenue recognition practices across entities, industries, jurisdictions, and capital markets and simplifies the preparation of financial statements by reducing the number of requirements to which an entity must refer. The Company is continuing to review the provisions of this ASU to determine if there will be any impact on its results of operations, cash flows or financial condition. In February 2016, FASB issued ASU No. 2016-02, Leases, which requires entities to recognize assets and liabilities for leases with lease terms greater than twelve months. The new guidance also requires quantitative and qualitative disclosures regarding the amount, timing and uncertainty of cash flows arising from leases. The standard is effective for annual and interim periods beginning after December 15, 2018, with early adoption permitted upon issuance. The Company is in process of evaluating the impact of adoption on its consolidated financial statements. In August 2014, FASB issued ASU No. 2014-15, Presentation of Financial Statements—Going Concern (Subtopic 205-40). This ASU provides guidance to determine when and how to disclose going-concern uncertainties in the financial statements. The new standard requires management to perform interim and annual assessments of an entity's ability to continue as a going concern within one year of the date that the financial statements are issued. An entity must provide certain disclosures if conditions or events raise substantial doubt about the entity's ability to continue as a going concern. This standard is effective for annual periods ending after December 15, 2016. The Company is evaluating the impact of the adoption of this ASU on its consolidated financial statements. The Company has reviewed other recent accounting pronouncements and concluded they are either not applicable to the business, or no material effect is expected on the consolidated financial statements as a result of future adoption. |
GOING CONCERN
GOING CONCERN | 6 Months Ended | 12 Months Ended |
Jul. 31, 2016 | Jan. 31, 2016 | |
GOING CONCERN | ||
GOING CONCERN | 2. GOING CONCERN The accompanying condensed consolidated financial statements have been prepared assuming the Company will continue as a going concern, meaning the Company will continue in operation for the foreseeable future and will be able to realize assets and discharge liabilities in the ordinary course of operations. As of July 31, 2016, the Company had cash and cash equivalents of $0.4 million and working capital deficit of $3.5 million. In August 2016, the Company raised net proceeds of approximately $2.9 million in a private offering of its common stock and sale of convertible promissory notes. The Company has incurred recurring losses and negative cash flows from operations since inception and has funded its operating losses through the sale of common stock in public and private offerings and the issuance of convertible notes, Series A convertible redeemable preferred stock and warrants. The Company incurred a net loss available to common stockholders of $5.0 million and $3.7 million during the three months ended July 31, 2016 and 2015, respectively, and $9.5 million and $7.6 million during the six months ended July 31, 2016 and 2015, respectively, and had an accumulated deficit of $35.7 million as of July 31, 2016. The Company has a limited operating history and its prospects are subject to risks, expenses and uncertainties frequently encountered by companies in its industry. To date, the Company has generated a de minimis amount of revenue from the sale of VI 2 OLET, its iodine dietary supplement. The Company continues its research and development efforts for its product candidates, which will require significant funding. If the Company is unable to obtain additional financing in the near-term, or if revenues fall short of expectations or research and development efforts require higher than anticipated capital, there may be a negative impact on the financial viability of the Company. The Company plans to increase working capital by managing its cash flows and expenses and raising additional capital through either private or public equity or debt financing. The Company also continues to pursue additional channel distribution expansion for VI 2 OLET through partnerships with women’s health companies to provide broader access to consumers. There can be no assurance that such financing will be available or on terms which are favorable to the Company. While management of the Company believes that it has a plan to fund ongoing operations, there is no assurance that its plan will be successfully implemented. Failure to generate sufficient cash flows from operations, raise additional capital through one or more financings, or reduce certain discretionary spending could have a material adverse effect on the Company’s ability to achieve its intended business objectives. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The condensed consolidated financial statements do not contain any adjustments that might result from the resolution of any of the above uncertainties. | 2. GOING CONCERN The Company has a limited operating history and its prospects are subject to risks, expenses and uncertainties frequently encountered by companies in the industry. The Company's ability to generate income in the short-run will depend greatly on the rate of adoption and ability to establish a sustainable market for VI 2 OLET. The Company continues its research and development efforts for its products, which will require significant funding. If revenues fall short of expectations or research and development efforts require higher than anticipated capital, then there may be a negative impact on the financial viability of the Company. The Company has incurred recurring losses and negative cash flows from operations since inception and has funded its operating losses through the sale of common stock in public and private offerings and the issuance of convertible notes, Series A convertible redeemable preferred stock and warrants. In June 2015, the Company raised net proceeds of $7.8 million in a public offering of its common stock. In December 2015, the Company raised net proceeds of $5.5 million in a private offering of its common stock and, in April 2016, raised net proceeds of approximately $3.6 million in a public offering of its common stock. The accompanying consolidated financial statements have been prepared assuming the Company will continue as a going concern. The Company plans to increase working capital by managing its cash flows and expenses, securing financing and increasing revenue. The Company continues to pursue additional channel distribution expansion for VI 2 OLET to provide even broader access to consumers. Risks include, but are not limited to, the uncertainty of availability of additional financing and the uncertainty of achieving future profitability. Management of the Company intends to raise additional funds through the issuance of equity securities. The Company has an effective shelf registration statement on file with the SEC to allow it to sell up to approximately $100 million of its securities from time to time prior to February 2019, subject to regulatory limitations. For example, pursuant to General Instruction I.B.6 of Form S-3, in no event will the Company sell securities pursuant to the shelf registration statement with a value of more than one-third of the aggregate market value of its common stock held by non-affiliates in any 12-month period, so long as the aggregate market value of its common stock held by non-affiliates is less than $75.0 million. There can be no assurance that such financing will be available or on terms which are favorable to the Company. Failure to generate sufficient cash flows from operations, raise additional capital or reduce certain discretionary spending could have a material adverse effect on the Company's ability to achieve its intended business objectives. These factors raise substantial doubt about the Company's ability to continue as a going concern. The consolidated financial statements do not contain any adjustments that might result from the resolution of any of the above uncertainties. As shown in the accompanying consolidated financial statements, the Company incurred a net loss available to common stockholders of $16.0 million during the year ended January 31, 2016, and had an accumulated deficit of $26.2 million as of January 31, 2016. As of January 31, 2016, the Company had working capital of approximately $1.6 million. While management of the Company believes that it has a plan to fund ongoing operations, there is no assurance that its plan will be successfully implemented. |
BALANCE SHEET DETAILS
BALANCE SHEET DETAILS | 6 Months Ended | 12 Months Ended |
Jul. 31, 2016 | Jan. 31, 2016 | |
BALANCE SHEET DETAILS | ||
BALANCE SHEET DETAILS | 4. BALANCE SHEET DETAILS July 31, January 31, (in thousands) Inventories: Work in process $ $ Finished goods Channel inventory Total $ $ | 3. BALANCE SHEET DETAILS January 31, 2016 2015 (in thousands) Inventories: Work in process $ $ Finished goods Channel inventory $ $ January 31, 2016 2015 (in thousands) Property and equipment, net: Furniture $ $ Laboratory equipment Computer and equipment Software Less: accumulated depreciation ) ) $ $ Depreciation expense for the year ended January 31, 2016, one month ended January 31, 2015 and year ended December 31, 2014 was $56,000, $1,000 and $25,000, respectively. Intangible assets, net: Intangible assets were as follows (dollar amounts in thousands): As of January 31, 2016 Estimated Useful Life Gross Value Accumulated Amortization Net Value Intangible assets 5 years $ $ ) $ As of January 31, 2015 Estimated Useful Life Gross Value Accumulated Amortization Net Value Intangible assets 5 years $ $ ) $ Amortization expense for the year ended January 31, 2016 and one month ended January 31, 2015 was $30,000 and $1,000, respectively. No amortization expense was recorded for the year ended December 31, 2014. Amortization is recorded in cost of goods sold. As of January 31, 2016, the estimated aggregate future amortization expense in future years is as follows (in thousands): Years ending January 31: 2017 $ 2018 2019 2020 Total $ January 31, 2016 2015 (in thousands) Accrued liabilities: Payroll $ $ Research and development — Legal — Marketing — Deferred rent Deferred revenue Other $ $ |
RELATED PARTY PAYABLES
RELATED PARTY PAYABLES | 6 Months Ended | 12 Months Ended |
Jul. 31, 2016 | Jan. 31, 2016 | |
RELATED PARTY PAYABLES | ||
RELATED PARTY PAYABLES | 5. RELATED-PARTY PAYABLES Since the beginning of 2014, a portion of the compensation of the founding executives of the Company has been deferred and is included in the related party payables balance. The deferred compensation is non-interest bearing and has periodically been repaid to these executives. Related party payables as of July 31, 2016 and January 31, 2016 were approximately $104,000 and $225,000, respectively. | 4. RELATED PARTY PAYABLES Since inception, the founding executives of the Company have made advances to cover short-term operating expenses. Additionally, since the beginning of 2014 a portion of their compensation has been deferred and is included in this balance. These advances and deferred compensation are non-interest bearing and have periodically been repaid to these executives. Related party payables as of January 31, 2016 and 2015 were $225,000 and $218,000, respectively. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended | 12 Months Ended |
Jul. 31, 2016 | Jan. 31, 2016 | |
COMMITMENTS AND CONTINGENCIES | ||
COMMITMENTS AND CONTINGENCIES | 6. COMMITMENTS AND CONTINGENCIES Commitments The following table summarizes the Company’s commitments as of July 31, 2016 (in thousands): Total 2017 2018 2019 2020 2021 Operating lease $ $ $ — $ — $ — $ — Purchase commitment Total $ $ $ $ $ $ On August 23, 2013, the Company signed a lease for 10,800 square feet of office and laboratory space in Menlo Park, California. The lease expires in November 2016. Rent expense for the three months ended July 31, 2016 and 2015 was approximately $86,000 and $94,000, respectively. Rent expense for each of the six months ended July 31, 2016 and 2015 was approximately $172,000. The purchase commitment relates to the manufacturing of VI2OLET and is non-cancelable. Legal Proceedings The Company is not a party to any material legal proceeding that the Company believes is likely to have a material adverse effect on its consolidated financial position or results of operations. From time to time the Company may be subject to legal proceedings and claims in the ordinary course of business. These claims, even if not meritorious, could result in the expenditure of significant financial resources and diversion of management efforts. Indemnification The Company enters into standard indemnification arrangements in the ordinary course of business. Pursuant to these arrangements, the Company indemnifies, holds harmless, and agrees to reimburse the indemnified parties for losses suffered or incurred by the indemnified party, in connection with any trade secret, copyright, patent or other intellectual property infringement claim by any third-party with respect to the Company’s technology. The term of these indemnification agreements is generally perpetual. The maximum potential amount of future payments the Company could be required to make under these agreements is not determinable because it involves claims that may be made against the Company in the future, but have not yet been made. The Company has entered into indemnification agreements with its directors and officers that may require the Company to indemnify its directors and officers against liabilities that may arise by reason of their status or service as directors or officers, other than liabilities arising from willful misconduct of the individual. The Company has not incurred costs to defend lawsuits or settle claims related to these indemnification agreements. No liability associated with such indemnifications has been recorded to date. License Agreement In March 2013, the Company entered into an amended and restated collaboration and license agreement with Iogen LLC, which provides the Company with a license to certain rights to label, market, and resell the finished inventory and ongoing manufacturing of the Iogen molecular iodine technology for future product formulation development and commercialization. New formulation patents developed by the Company will be solely owned by the Company. The agreement gives the Company a perpetual, fully paid-up, exclusive license to make, have made, use, sell and offer for sale and import products. Pursuant to the terms of the license, the Company must pay: · a fee for the exclusive license to the IP. · 30% of net profit associated with direct commercialization of an OTC product or 30% of net royalties received from any sub-licensee. · a royalty of 3% of net sales for the first 24 months of commercialization and 2% of net sales thereafter for a prescription iodine tablet developed and commercialized under the license. · a royalty of 3% of net sales for the first 12 months of commercialization for other products developed and commercialized under the license and 2% of net sales thereafter until expiration of applicable patents covering such products and 1% thereafter. · a fixed royalty fee for the protection and indemnification of licensed intellectual property right (“IP rights”) for the prescription product developed, marketed and sold from newly developed formulations as long as the patents are valid and cover the prescription product. · a fixed royalty fee for the protection and indemnification of licensed IP rights for the other products utilizing the molecular iodine technology developed, marketed and sold from newly developed formulations as long as the patents are valid and cover the prescription product. The Company capitalized as intangible assets, in the year ended December 31, 2013, the amount of $150,000 related to this agreement. As of July 31, 2016 and January 31, 2016, the balance, net of amortization, was approximately $104,000 and $119,000, respectively. No royalties have been paid as of July 31, 2016. | 5. COMMITMENTS AND CONTINGENCIES Commitments The following table summarizes the Company's commitments as of January 31, 2016 (in thousands): Total 2017 2018 2019 2020 2021 Operating lease $ $ $ — $ — $ — $ — Purchase commitment Total $ $ $ $ $ $ On August 23, 2013, the Company signed a lease for 10,800 square feet of office and laboratory space in Menlo Park, California. The lease expires in November 2016. Rent expense for the year ended January 31, 2016, one month ended January 31, 2015 and year ended December 31, 2014 was $357,000, $26,000 and $310,000, respectively. The purchase commitment relates to the manufacturing of VI 2 OLET and is non-cancelable. Legal Proceedings The Company is not currently a party to any legal proceedings. The Company is not aware of any pending legal proceeding to which any of its officers, directors, or any beneficial holders of 5% or more of its voting securities are adverse to the Company or have a material interest adverse to the Company. Indemnification The Company enters into standard indemnification arrangements in the ordinary course of business. Pursuant to these arrangements, the Company indemnifies, holds harmless, and agrees to reimburse the indemnified parties for losses suffered or incurred by the indemnified party, in connection with any trade secret, copyright, patent or other intellectual property infringement claim by any third-party with respect to the Company's technology. The term of these indemnification agreements is generally perpetual. The maximum potential amount of future payments the Company could be required to make under these agreements is not determinable because it involves claims that may be made against the Company in the future, but have not yet been made. The Company has entered into indemnification agreements with its directors and officers that may require the Company to indemnify its directors and officers against liabilities that may arise by reason of their status or service as directors or officers, other than liabilities arising from willful misconduct of the individual. The Company has not incurred costs to defend lawsuits or settle claims related to these indemnification agreements. No liability associated with such indemnifications has been recorded to date. License Agreement In March 2013, the Company entered into an amended and restated collaboration and license agreement with Iogen, which provides the Company with a license to certain rights to label, market, and resell the finished inventory and ongoing manufacturing of the Iogen molecular iodine technology for future product formulation development and commercialization. New formulation patents developed by the Company will be solely owned by the Company. The agreement gives the Company a perpetual, fully paid-up, non-exclusive license to make, have made, use, sell and offer for sale and import products. Pursuant to the terms of the license, the Company must: • Pay a fee for the non-exclusive license to the IP. • Pay 30% of net profit associated with direct commercialization of an OTC product or 30% of net royalties received from any sub-licensee. • Pay a royalty of 3% of net sales for the first 24 months of commercialization and 2% of net sales thereafter for a prescription iodine tablet developed and commercialized under the license. • Pay a royalty of 3% of net sales for the first 12 months of commercialization for other products developed and commercialized under the license and 2% of net sales thereafter until expiration of applicable patents covering such products and 1% thereafter. • Pay a fixed royalty fee for the protection and indemnification of licensed intellectual property rights ("IP rights") for the prescription product developed, marketed and sold from newly developed formulations as long as the patents are valid and cover the prescription product. • Pay a fixed royalty fee for the protection and indemnification of licensed IP rights for the other products utilizing the molecular iodine technology developed, marketed and sold from newly developed formulations as long as the patents are valid and cover the prescription product. The Company capitalized as intangible assets, the amount of $150,000 related to this agreement. As of January 31, 2016 and 2015, the balance, net of amortization, was $119,000 and $149,000, respectively. No royalties have been paid as of January 31, 2016. |
CONVERTIBLE REDEEMABLE PREFERRE
CONVERTIBLE REDEEMABLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY | 6 Months Ended | 12 Months Ended |
Jul. 31, 2016 | Jan. 31, 2016 | |
CONVERTIBLE REDEEMABLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY | ||
CONVERTIBLE REDEEMABLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY | 7. CONVERTIBLE REDEEMABLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY Common Stock In June 2015, the Company uplisted to the NYSE MKT and simultaneously completed a public offering in which it issued 3,636,384 shares of common stock resulting in net proceeds of $7.8 million. Pursuant to the terms of a convertible note previously issued, immediately prior to the closing of the offering, the principal amount and all accrued and unpaid interest converted into 182,266 shares of common stock. Pursuant to a subscription agreement dated October 24, 2014, Korea Investment Partners Overseas Expansion Platform Fund (“KIP”), an existing stockholder, agreed to purchase 1,081,081 shares of common stock from the Company at a price of $1.85 per share in a private placement (the “KIP private placement”) upon the earlier to occur of (i) the Company receiving revenues from Violet of $2,000,000 or (ii) receipt by the Company of approval to list on any tier of the NYSE or Nasdaq stock market at a market price of at least $3.70 per share. In addition, KIP has previously informed the Company of its intention to complete the KIP private placement even if the Company’s stock price was not at least $3.70 per share. As of the date of this report, this private placement has not closed, and the Company does not expect the private placement to close. As consideration for Ping Wang’s service as a director of the Company (Wang is no longer a director of the Company), 290,000 shares of the Company’s common stock were issued, of which 96,667 shares vested immediately and 193,333 shares will vest immediately upon completion of the $2.0 million purchase. In December 2015, the Company sold 4,100,000 shares of common stock at a price per share of $1.43 resulting in net proceeds of $5.5 million in a private placement to investment funds managed by Franklin Advisers. For a period of five years, Franklin Advisers has the right to purchase up to an aggregate of 20% of the securities offered by the Company in any subsequent private placement. In April 2016, the Company issued 3,600,000 shares of common stock at a price per share of $1.195 resulting in net proceeds of approximately $3.6 million and warrants to purchase 1,952,000 shares of common stock in a public offering. These warrants have an exercise price of $1.20 per share and expire on April 1, 2021. As of July 31, 2016, all of these warrants were outstanding. Series A Preferred Stock During 2014, the Company entered into subscription agreements for the private placement of 4,207,987 shares of its Series A preferred stock and warrants to purchase 2,042,589 shares of common stock at an exercise price of $3.70 per share. In connection with the uplisting to the NYSE MKT, the Series A preferred stock, including accrued and unpaid interest, converted into 4,319,426 shares of common stock. The warrant exercise agreements included a provision such that if the public offering price related to the offering was less than $3.125 per share, then immediately prior to the closing of the offering, additional shares of common stock would be issued at no additional consideration to each holder equal to: (i) the product of (A) the difference between $2.50 per share and 80% of the public offering price and (B) such holder’s shares of common stock received pursuant to exercise of the amended warrants, divided by (ii) 80% of the public offering price in the offering. Based on a public offering price of $2.75 per share, 77,006 shares of common stock were issued pursuant to this provision. In March and April 2015, the Company amended certain of the warrants issued in connection with the Series A preferred stock financing to reduce the exercise price of such warrants from $3.70 to $2.50 per share with a corresponding increase in the number of shares of common stock exercisable under the warrants so that the aggregate exercise value of such warrants remained the same. As of January 31, 2016, certain holders had exercised such warrants for an aggregate of 564,662 shares of common stock for an aggregate cash exercise price of $1,411,655. The Company recorded a charge for the incremental fair value of $436,000 in other expense related to the amended warrants in the first quarter of fiscal year 2016. The fair value of the warrants exercised was computed as of the date of modification using the following assumptions: dividend rate of 0%, risk-free rate of 1.6%, contractual term of four to five years and expected volatility of 85.9%. As of July 31, 2016, of the warrants issued in connection with the Series A preferred stock financing, warrants to purchase 1,661,055 shares of common stock remain outstanding. Pursuant to the Certificate of Elimination filed with the Secretary of State of the State of Delaware on March 17, 2016, all shares of Series A preferred stock previously designated were returned to the status of authorized but unissued shares of preferred stock, without designation as to series or rights, preferences, privileges or limitations. Warrants In addition to the warrants issued in conjunction with the Series A preferred stock subscription agreements, the Company issued warrants on May 15, 2014, to a service provider for 316,395 shares of common stock at an exercise price of $2.035 per share, which were valued at $99,000 and expensed. As of July 31, 2016, all were outstanding. On May 14, 2014, the Company also issued warrants valued at $105,000 for 343,559 shares of common stock at an exercise price of $1.85 per share to a qualified investor as a part of his convertible loan package. These warrants expire five years after the date of issuance. These warrants are immediately exercisable, and in June 2015, a portion of the warrants were exercised for 54,054 shares of common stock. As of July 31, 2016, warrants exercisable for 289,505 shares of common stock remain outstanding. In connection with the offering completed in June 2015, warrants to purchase 109,091 shares of common stock were issued to the underwriters at the public offering price of $2.75. These warrants expire five years after the date of issuance. As of July 31, 2016, all of these warrants were outstanding. In connection with the sale of common stock in April 2016, warrants to purchase 1,952,000 shares of common stock were issued at an exercise price of $1.20. As of July 31, 2016, all of these warrants were outstanding. Equity Incentive Plan On July 5, 2016, the Company adopted the 2016 Equity Incentive Plan, or 2016 Plan, which permits the Company to grant equity awards to directors, officers, employees and consultants. In connection with the adoption of the 2016 Plan, the Company ceased to grant equity awards under its 2014 Equity Incentive Plan, or 2014 Plan, which was adopted on January 23, 2014. All grants and awards under the 2014 Plan, including stock options previously issued under BioPharmX, Inc.’s 2011 Equity Incentive Plan which were substituted with stock options issued under the 2014 Plan, remain in effect in accordance with their terms. Stock options generally vest in two to four years and expire ten years from the date of grant. Under the 2016 Plan, 4,000,000 shares were reserved for issuance. The 2014 Plan and 2016 Plan are referred to collectively as the “Plans.” The following table summarizes the Company’s stock option activities under the Plans: Available Shares Weighted Remaining Aggregate (in thousands) Outstanding as of January 1, 2016 $ $ Exercised — ) $ Cancelled ) $ Outstanding as of April 30 2016 $ $ Shares authorized for issuance — Granted ) $ Exercised — ) $ Cancelled ) $ Expired upon termination of the 2014 Plan ) — $ — Outstanding as of July 31, 2016 $ $ Vested and exercisable $ $ Vested and expected to vest $ $ Inducement Grants The Company has also awarded inducement option grants to purchase common stock to new employees outside of the 2014 Plan as permitted under Section 711(a) of the NYSE MKT Company Guide. Such options vest at the rate of 25% of the shares on the first anniversary of the commencement of such employee’s employment with the Company, and then one forty-eighth (1/48) of the shares monthly thereafter subject to such employee’s continued service. The following table summarizes the Company’s inducement grant stock option activities: Shares Weighted Remaining Aggregate (in thousands) Balance at January 31, 2016, April 30, 2016 and July 31, 2016 $ $ — Vested and exercisable — $ — — $ — Vested and expected to vest $ $ — The following table summarizes significant ranges of outstanding and exercisable options as of July 31, 2016: Options Outstanding Options Vested and Exercisable Range of Exercise Price Number Weighted Weighted Number Weighted $0.25 - $0.62 $ $ $0.63 - $1.00 $ $ $1.01 - $1.67 $ $ $1.68 - $3.00 $ $ $3.01 - $3.25 $ $ $ $ The total intrinsic value of stock options exercised during the three and six months ended July 31, 2016 was approximately $5,000 and $39,000, respectively. The total intrinsic value of stock options exercised during the three and six months ended July 31, 2015 was $1.2 million and $1.3 million, respectively. | 6. CONVERTIBLE REDEEMABLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY Common Stock As described in Note 1, on January 23, 2014, the Company issued 7,025,000 shares of its common stock to BioPharmX, Inc. stockholders. The Company issued convertible notes payable ("Notes") from September 2012 through March 2014. Under the terms of the Notes, on April 11, 2014, the Notes automatically converted into 1,526,001 shares of common stock upon the Company's sale of Series A Preferred Stock. In June 2015, the Company uplisted to the NYSE MKT and simultaneously completed a public offering (the "Offering") in which it issued 3,636,384 shares of common stock resulting in net proceeds of $7.8 million. Pursuant to the subscription agreement dated October 24,2014, KIP, an existing stockholder, shall purchase shares in the KIP private placement upon the earlier to occur of (i) the Company receiving revenues from Violet of $2,000,000 or (ii ) receipt by the Company of approval to list on any tier of the NYSE or Nasdaq stock market at a market price of at least $3.70 per share. In addition, KIP has previously informed the Company of its intention to complete the KIP private placement even if the Company’s stock price was not at least $3.70 per share. As of May 2, 2016, this private placement has not closed, and the Company is unable to predict if or when the private placement will close. As consideration for Ping Wang's service as a director of the Company, 290,000 shares of the Company's common stock were issued, of which 96,667 vested immediately and 193,333 shares of the common stock will vest immediately upon completion of the $2.0 million purchase. In June 2015, the Company issued a 6% unsecured convertible note in the principal amount of $500,000 to an investor. Under the terms of the convertible note, immediately prior to the closing of the Offering, the principal amount and all accrued and unpaid interest, converted into 182,266 shares of common stock. In December 2015, the Company sold 4,100,000 shares of common stock at a price per share of $1.43 resulting in net proceeds of $5.5 million in a private placement to investment vehicles of Franklin Advisers. For a period of 5 years, Franklin Advisers have the right to purchase up to an aggregate of 20% of the securities offered by the Company in any subsequent private placement. Series A Preferred Stock The Company entered into subscription agreements for the private placement of shares of its Series A preferred stock and warrants with 47 accredited investors during 2014 whereby the Company sold an aggregate of 4,207,987 shares of Series A preferred stock at a per share price of $1.85 for gross proceeds of $7.5 million and issued to the investors for no additional consideration warrants to purchase in the aggregate 2,042,589 shares of common stock, with an exercise price of $3.70 per share. The allocated fair value of the warrants related to these subscription agreements was determined to be $845,000 and was recorded as additional paid-in capital. The fair value was computed using the Black-Scholes pricing model with the following assumptions: dividend rate of 0%, risk-free rate of 1.6% to 4.0%, contractual term of 5 years and expected volatility of 88.8%. In connection with the uplisting to the NYSE MKT, the Series A preferred stock, including accrued and unpaid interest, converted into 4,319,426 shares of common stock. In March and April 2015, the Company amended certain of the warrants issued in connection with the Series A preferred financing to reduce the exercise price of such warrants from $3.70 to $2.50 per share with a corresponding increase in the number of shares of common stock exercisable under the warrants so that the aggregate exercise value of such warrants remained the same. As of January 31, 2016, certain holders had exercised such warrants for an aggregate of 564,662 shares of common stock for an aggregate cash exercise price of $1,411,655. The Company recorded a charge for the incremental fair value of $436,000 in other expense related to the amended warrants in the first quarter of fiscal year 2016. The fair value of the warrants exercised was computed as of the date of modification using the following assumptions: dividend rate of 0%, risk-free rate of 1.6%, contractual term of 4 to 5 years and expected volatility of 85.9%. As of January 31, 2016, of the warrants issued in connection with the Series A preferred stock financing, warrants to purchase 1,661,055 shares of common stock remain outstanding. The warrant exercise agreements included a provision such that if the public offering price related to the Offering was less than $3.125 per share, then immediately prior to the closing of the Offering, additional shares of common stock would be issued at no additional consideration to each holder equal to: (i) the product of (A) the difference between $2.50 per share and 80% of the public offering price and (B) such holder's shares of common stock received pursuant to exercise of the amended warrants, divided by (ii) 80% of the public offering price in the Offering. Based on a public offering price of $2.75 per share, 77,006 shares of common stock were issued pursuant to this provision. Warrants In addition to the warrants issued in conjunction with the subscription agreements, the Company issued warrants on May 15, 2014, to a service provider for 316,395 shares of common stock at an exercise price of $2.035 per share, which were valued at $99,000 and expensed. As of January 31, 2016, all were outstanding. On May 14, 2014, the Company also issued warrants valued at $105,000 for 343,559 shares of common stock at an exercise price of $1.85 per share to a qualified investor as a part of his convertible loan package. These warrants expire five years after the date of issuance. These warrants are immediately exercisable, and in June 2015, a portion of the warrants were exercised for 54,054 shares of common stock. As of January 31, 2016, warrants exercisable for 289,505 shares of common stock remain outstanding. In connection with the Offering, 109,091 warrants were issued to the underwriters at the public offering price of $2.75. These warrants expire five years after the date of issuance. As of January 31, 2016, all were outstanding. Equity Incentive Plan On January 23, 2014, the Company adopted the 2014 Equity Incentive Plan, or the 2014 Plan, which permits the Company to grant stock options to directors, officers or employees of the Company or others to purchase shares of common stock of the Company through awards of incentive and nonqualified stock options, restricted stock awards and stock appreciation rights. Stock options previously issued under BioPharmX, Inc.'s 2011 Equity Incentive Plan were substituted with stock options issued under the 2014 Plan. Stock options generally vest in two to four years and expire ten years from the date of grant. The total number of shares originally reserved and available for grant and issuance pursuant to the 2014 Plan was 2,700,000. Shares issued under the 2014 Plan are drawn from authorized and unissued shares or shares now held or subsequently acquired by the Company. On November 7, 2014, the Company increased the stock reserve available to the 2014 Plan for stock awards from 2,700,000 shares to 4,500,000 shares. The following table summarizes the Company's stock option activities under the 2014 Plan: Available for Grant Shares Weighted Average Exercise Prices Remaining Contractual Life Aggregate Intrinsic Value (in thousands) Balance at January 1, 2013 $ Granted ) Balance at December 31, 2013 $ Additional shares authorized — — Granted ) Exercised — ) Cancelled ) Balance at December 31, 2014 $ $ Granted ) Exercised — ) Cancelled ) Balance at January 31, 2015 $ $ Granted ) Exercised — ) Cancelled ) Balance at January 31, 2016 $ $ Vested and exercisable $ $ Vested and expected to vest $ $ Inducement Grants The Company has also awarded inducement options to purchase common stock to new employees outside of the 2014 Plan as material inducements to the acceptance of employment with the Company as permitted under Section 711(a) of the NYSE MKT Company Guide. Such options vest at the rate of 25% of the shares on the first anniversary of the commencement of such employee's employment with the Company, and then one forty-eighth (1/48) of the shares monthly thereafter subject to such employee's continued service. The following table summarizes the Company's inducement grant stock option activities: Shares Weighted Average Exercise Prices Remaining Contractual Life Aggregate Intrinsic Value (in thousands) Balance at January 31, 2015 — — — — Granted $ Balance at January 31, 2016 $ $ Vested and exercisable — $ — — $ — Vested and expected to vest $ $ The following table summarizes significant ranges of outstanding and exercisable options as of January 31, 2016: Options Outstanding Options Vested and Exercisable Range of Exercise Price Number Outstanding Weighted Average Remaining Contractual Life (in Years) Weighted Average Exercise Prices Number Vested and Exercisable Weighted Average Exercise Prices $0.25 - $1.00 $ $ $1.01 - $1.67 $ $ $1.68 - $3.00 $ $ $3.01 - $3.25 $ — — $ $ The total intrinsic value of stock options exercised during the year ended January 31, 2016, the month ended January 31, 2015 and year ended December 31, 2014 was $1.4 million, $82,000 and $676,000, respectively. The weighted average grant date fair values of the stock options granted during the year ended January 31, 2016, the month ended January 31, 2015 and year ended December 31, 2014 was $1.44, $1.92 and $1.10, respectively. |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 6 Months Ended | 12 Months Ended |
Jul. 31, 2016 | Jan. 31, 2016 | |
STOCK-BASED COMPENSATION | ||
STOCK-BASED COMPENSATION | 8. STOCK-BASED COMPENSATION The following table summarizes the stock-based compensation expenses included in the unaudited condensed consolidated statement of operations and comprehensive loss (in thousands): For the three months ended For the six months ended 2016 2015 2016 2015 Research and development $ $ $ $ Sales and marketing General and administrative expenses Total $ $ $ $ The Company estimates the fair value of stock options granted using the Black-Scholes pricing model. This model also requires subjective assumptions, including future stock price volatility and expected time to exercise, which greatly affect the calculated values. For employee grants, the fair value is amortized on a straight-line basis over the requisite service periods of the awards, which is generally the vesting period. As of July 31, 2016, total compensation costs related to unvested, but not yet recognized, stock-based awards was $2.7 million, net of estimated forfeitures. This cost will be amortized on a straight-line basis over a weighted average remaining period of 2.76 years and will be adjusted for subsequent changes in estimated forfeitures. Valuation Assumptions The following assumptions were used to calculate the estimated fair value of awards granted during the three and six months ended July 31, 2016: For the three months ended For the six months ended 2016 2015 2016 2015 Expected volatility 97.0% - 98.6% 97.0% - 98.6% Expected term in years Risk-free interest rate 1.14% - 1.28% 1.14% - 1.28% 1.62% - 1.71% Expected dividend yield — — — — Expected Term The expected term represents the period that the Company’s stock-based awards are expected to be outstanding. For awards granted subject only to service vesting requirements, the Company utilizes the simplified method for estimating the expected term of the stock-based award, instead of historical exercise data. Expected Volatility The Company uses the historical volatility of the price of shares of common stock of selected public companies, including the Company’s stock price, in the biotechnology sector due to its limited trading history. Risk-Free Interest Rate The Company bases the risk-free interest rate used in the Black-Scholes pricing method upon the implied yield curve currently available on U.S. Treasury zero-coupon issues with a remaining term equal to the expected term used as the assumption in the model. Expected Dividend The Company has never paid dividends on its shares of common stock and currently does not intend to do so and, accordingly, the dividend yield percentage is zero for all periods. | 7. STOCK-BASED COMPENSATION The following table summarizes the stock-based compensation expenses included in the Company's Statement of Operations and Comprehensive Loss for the periods ended (in thousands): Year ended January 31, One month ended January 31, Year ended December 31, 2016 2015 2014 Research and development $ $ Sales and marketing General and administrative Total $ $ $ The Company estimates the fair value of stock options granted using the Black-Scholes pricing model. This model also requires subjective assumptions, including future stock price volatility and expected time to exercise, which greatly affect the calculated values. For employee grants, the fair value is amortized on a straight-line basis over the requisite service periods of the awards, which is generally the vesting period. As of January 31, 2016, total compensation costs related to unvested, but not yet recognized, stock-based awards was $2.7 million, net of estimated forfeitures. This cost will be amortized on a straight-line basis over a weighted average remaining period of 3.02 years and will be adjusted for subsequent changes in estimated forfeitures. Valuation Assumptions The following assumptions were used to calculate the estimated fair value of awards granted for the periods ended: Year ended January 31, One month ended January 31, Year ended December 31, 2016 2015 2014 Expected volatility 81.3% - 82.6% % % Expected term in years 6.0 Risk-free interest rate 1.57% - 2.26% % % Expected dividend yield —% — % — % Expected Term The expected term represents the period that the Company's stock-based awards are expected to be outstanding. For awards granted subject only to service vesting requirements, the Company utilizes the simplified method for estimating the expected term of the stock-based award, instead of historical exercise data. Expected Volatility The Company uses the historical volatility of the price of the common shares of selected public companies in the biotechnology sector due to its limited trading history. Expected Dividend The Company has never paid dividends on its common shares and currently does not intend to do so and, accordingly, the dividend yield percentage is zero for all periods. Risk-Free Interest Rate The Company bases the risk-free interest rate used in the Black-Scholes pricing method upon the implied yield curve currently available on U.S. Treasury zero-coupon issues with a remaining term equal to the expected term used as the assumption in the model. |
EMPLOYEE BENEFIT PLAN
EMPLOYEE BENEFIT PLAN | 12 Months Ended |
Jan. 31, 2016 | |
EMPLOYEE BENEFIT PLAN | |
EMPLOYEE BENEFIT PLAN | 8. EMPLOYEE BENEFIT PLAN The Company sponsors a 401(k) defined contribution plan for its employees. This plan provides for tax-deferred salary deductions for all full-time employees. Employee contributions are voluntary. Employees may contribute up to 100% of their annual compensation to this plan, as limited by an annual maximum amount as determined by the Internal Revenue Service. The Company may match employee contributions in amounts to be determined at the Company's sole discretion. The Company has made no contributions to the plan for the year ended January 31, 2016, the month ended January 31, 2015 and the year ended December 31, 2014. |
INCOME TAXES
INCOME TAXES | 6 Months Ended | 12 Months Ended |
Jul. 31, 2016 | Jan. 31, 2016 | |
INCOME TAXES | ||
INCOME TAXES | 9. INCOME TAXES The Company evaluates its ability to recover deferred tax assets, in full or in part, by considering all available positive and negative evidence, including past operating results and its forecast of future taxable income on a jurisdictional basis. The Company bases its estimate of current and deferred taxes on the tax laws and rates that are currently in effect in the appropriate jurisdiction. Changes in laws or rates may affect the tax provision as well as the amount of deferred tax assets or liabilities. Current tax laws impose substantial restrictions on the utilization of net operating loss and credit carry-forwards in the event of an “ownership change,” as defined by the Internal Revenue Code. If there should be an ownership change, the Company’s ability to utilize its carry-forwards could be limited. As of July 31, 2016 and January 31, 2016, the Company has not recorded any liability for unrecognized tax benefits related to uncertain tax positions. The 2011 to 2015 tax years remain open for examination by the federal and state authorities. | 9. INCOME TAXES No federal income taxes were provided in the year ended January 31, 2016, month ended January 31, 2015 or year ended December 31, 2014 due to the Company's net losses. The provision of income taxes consist of state minimum income taxes. At January 31, 2016, the Company had available federal net operating loss ("NOL") carry-forwards of approximately $19.4 million which will begin to expire in 2030 and California state NOL carry-forwards of approximately $19.4 million which will begin to expire in 2030. At January 31, 2016 and 2015, the net deferred tax assets of approximately $8.8 million and $3.6 million, respectively, generated primarily by NOL carry-forwards, have been fully reserved due to the uncertainty surrounding the realization of such benefits. The net valuation allowance increased by approximately $5.2 million, $0.4 million and $2.6 million during the year ended January 31, 2016, the month ended January 31, 2015 and year ended December 31, 2014, respectively. Current tax laws impose substantial restrictions on the utilization of net operating loss and credit carry-forwards in the event of an "ownership change," as defined by the Internal Revenue Code. If there should be an ownership change, the Company's ability to utilize its carry-forwards could be limited. Significant components of the Company's deferred tax assets were as follows (in thousands): January 31, 2016 2015 Deferred tax assets: Net operating loss carryforwards $ $ Stock-based compensation expense — Tax credit carryforwards — Other Total deferred tax assets Less: Valuation allowance ) ) Net deferred tax assets $ — $ — A reconciliation of income taxes provided at the federal statutory rate (34%) to the actual income tax provision was as follows (in thousands): Year ended January 31, 2016 Income tax benefit computed at U.S. statutory rate $ ) State income tax (net of federal benefit) ) Stock-based compensation Warrant valuation Research and development credits ) Change in valuation allowance Other Income tax provision $ As of January 31, 2016 and 2015, the Company did not have any material unrecognized tax benefits. The tax years from 2010 to 2016 remain open for examination by the federal and state authorities. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 6 Months Ended | 12 Months Ended |
Jul. 31, 2016 | Jan. 31, 2016 | |
SUBSEQUENT EVENTS | ||
SUBSEQUENT EVENTS. | 10. SUBSEQUENT EVENTS In August 2016, the Company (i) raised net proceeds of approximately $1.4 million in a private offering of 2,423,077 shares of its common stock at $0.65 per share and (ii) issued convertible promissory notes in the principal amount of $1.5 million. One convertible promissory note is secured, has a principal amount of $1.0 million and matures 36 months from the date of issuance if not earlier converted pursuant to the terms therein. The secured note is convertible into shares of the Company’s common stock at a conversion rate of $0.80 per share and bears interest at a rate of 10% per year. The secured note will automatically convert into shares of the Company’s common stock at the conversion price on the earlier of (a) the closing of a Qualified Financing Event, (b) the Maturity Date, or (c) a Liquidation Event, each as defined and as further described in the secured note. In connection with the issuance of the secured note, the Company entered into a security agreement with the investor pursuant to which the investor was granted a security interest in substantially all assets of the Company. The other convertible promissory note is unsecured, has a principal amount of $0.5 million and matures six months from the date of issuance if not earlier converted pursuant to the terms therein. The unsecured note is convertible into shares of the Company’s common stock at a conversion rate of $0.80 per share and bears interest at a rate of 10% per year. The unsecured note will automatically convert into shares of the Company’s common stock at the conversion price on the earlier of (a) the Maturity Date, (b) the closing of a public offering of equity securities or securities convertible into equity securities or (c) a Liquidation Event, each as defined and as further described in the unsecured note. In connection with the August 2016 private placements, the Company entered into a standstill agreement with certain investors in the common stock offering as well as a registration rights agreement with all investors in the common stock offering, and registration rights agreements with each of the holders of the convertible promissory notes. | 10. SUBSEQUENT EVENTS In April 2016, the Company raised net proceeds of approximately $3.6 million, after expenses of approximately $0.7 million, excluding any proceeds from warrant exercises, from the sale of 3,600,000 shares of common stock and 1,952,000 warrants to purchase common stock at an exercise price of $1.20 per share in an equity offering under its shelf registration statement. |
DESCRIPTION OF BUSINESS AND S19
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended | 12 Months Ended |
Jul. 31, 2016 | Jan. 31, 2016 | |
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Share Exchange | Share Exchange On January 23, 2014, the Company (then operating as Thompson Designs, Inc.), BioPharmX, Inc. and stockholders of BioPharmX, Inc., who collectively owned 100% of BioPharmX, Inc., entered into and consummated transactions pursuant to a share exchange agreement, such transaction referred to as the Share Exchange, whereby the Company issued to the stockholders of BioPharmX, Inc. an aggregate of 7,025,000 shares of its common stock, in exchange for 100% of the shares of BioPharmX, Inc. held by stockholders. The shares of the Company's common stock received by the stockholders of BioPharmX, Inc. in the Share Exchange constituted approximately 77.8% of its then issued and outstanding common stock, after giving effect to the issuance of shares pursuant to the share exchange agreement. As a result of the Share Exchange, BioPharmX, Inc. became the Company's wholly-owned subsidiary. For accounting purposes, the Share Exchange was treated as a reverse acquisition with BioPharmX, Inc. as the acquirer and the Company as the acquired party, and as a result the historical financial statements prior to the Share Exchange included in this Annual Report on Form 10-K are the historical financial statements of BioPharmX, Inc. On March 3, 2014, the Company changed its name to BioPharmX Corporation. On May 16, 2014, the Company reincorporated from Nevada to Delaware. | |
Change in Fiscal Year End | Change in Fiscal Year End On March 26, 2015, the board of directors of the Company approved a change in its fiscal year end from December 31 to January 31. | |
Basis of Presentation and Principles of Consolidation | Basis of Presentation and Principles of Consolidation These unaudited interim condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting and include the accounts of the Company and its subsidiary. Certain information and note disclosures normally included in the consolidated financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. Accordingly, these unaudited interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the year ended January 31, 2016, filed on May 2, 2016. The condensed consolidated balance sheet as of January 31, 2016, included herein, was derived from the audited consolidated financial statements as of that date. The unaudited interim condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary and have been prepared on the same basis as the audited consolidated financial statements and include all adjustments, consisting only of normal recurring adjustments, necessary for the fair presentation of the Company’s statement of financial position as of July 31, 2016 and January 31, 2016, and the Company’s results of operations and its cash flows for the three and six months ended July 31, 2016 and 2015. The results for the three and six months ended July 31, 2016 are not necessarily indicative of the results to be expected for the year ending January 31, 2017 or any future period | Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America ("GAAP"). The accompanying financial statements include the accounts of BioPharmX and its wholly-owned subsidiary. All intercompany transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses recognized during the reported period. Actual results could differ from those estimates. | Use of Estimates The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses recognized during the reported period. Actual results could differ from those estimates. |
Reclassification | Reclassification Certain prior year amounts have been reclassified to conform to the current year presentation. Deferred rent, accrued payroll and deferred revenue have been included in accrued liabilities and other current liabilities. The amounts for the prior periods have been reclassified to be consistent with the current year presentation and have no impact on previously reported total assets, total stockholders' deficit or net loss. | |
Fair Value Measurements | Fair Value Measurements The Company recognizes and discloses the fair value of its assets and liabilities using a hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to valuations based upon unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to valuations based upon unobservable inputs that are significant to the valuation (Level 3 measurements). Each level of input has different levels of subjectivity and difficulty involved in determining fair value. • Level 1—Inputs used to measure fair value are unadjusted quoted prices that are available in active markets for the identical assets or liabilities as of the reporting date. • Level 2—Observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities 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 asset or liability. • Level 3—Unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities. As of January 31, 2016, the Company held $3.6 million in money market funds, which are classified as Level 1 within the fair value hierarchy. No unrealized gains or losses are recorded in connection with these amounts. | |
Accounts Receivable | Accounts Receivable Accounts receivable is recorded net of cash discounts for prompt payment and return allowances. There was no allowance for doubtful accounts receivable recorded at either January 31, 2016 or 2015. | |
Inventories | Inventories Inventories are stated at the lower of cost or market. Cost is determined using the standard cost method which approximates actual cost on a first-in, first-out basis. Market value is determined as the lower of replacement cost or net realizable value. The Company regularly reviews inventory quantities in consideration of actual loss experiences, projected future demand and remaining shelf life to record a provision for excess and obsolete inventory when appropriate. | Inventories Inventories are stated at the lower of cost or market. Cost is determined using the standard cost method which approximates actual cost on a first-in, first-out basis. Market value is determined as the lower of replacement cost or net realizable value. The Company regularly reviews inventory quantities in consideration of actual loss experiences, projected future demand and remaining shelf life to record a provision for excess and obsolete inventory when appropriate. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Carrying amounts of certain of the Company's financial instruments, including cash and cash equivalents, prepaid and other current assets, accounts payable, accrued expenses and other liabilities and related party payables approximate fair value due to their short maturities. | |
Property and Equipment | Property and Equipment Property, plant and equipment is stated at cost less accumulated depreciation and amortization. Depreciation and amortization are recognized using the straight-line method. Repairs and maintenance costs are expensed as incurred. Estimated useful lives in years are as follows: Description Estimated Useful Life Furniture 5 - 7 Laboratory equipment 3 - 5 Computer and equipment 3 - 5 Software 5 | |
Intangible Assets | Intangible Assets Intangible assets with finite useful lives are amortized over their estimated useful lives. Intangible assets with finite useful lives are reviewed for impairment when facts or circumstances suggest that the carrying value of these assets may not be recoverable. The intangible assets were acquired in March 2013 in connection with the collaboration and license agreement with Iogen detailed in Note 5. Amortization of the intangible assets commenced in January 2015 with the first recognition of revenue related to VI 2 OLET and is being taken on a straight-line basis over 5 years. | |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset might not be recoverable. When such an event occurs, management determines whether there has been an impairment by comparing the anticipated undiscounted future net cash flows to the related asset’s carrying value. If an asset is considered impaired, the asset is written down to fair value, which is determined based either on discounted cash flows or appraised value, depending on the nature of the asset. The Company has not identified any such impairment losses to date. | Impairment of Long-Lived Assets The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset might not be recoverable. When such an event occurs, management determines whether there has been an impairment by comparing the anticipated undiscounted future net cash flows to the related asset's carrying value. If an asset is considered impaired, the asset is written down to fair value, which is determined based either on discounted cash flows or appraised value, depending on the nature of the asset. The Company has not identified any such impairment losses to date. |
Restricted Cash | Restricted Cash The Company has restricted cash in the amount of $35,000 held in a money market account to secure the credit line of the Company's credit cards. | |
Revenue Recognition | Revenue Recognition VI 2 OLET is a new product in the dietary supplement field. Revenue is recognized provided that persuasive evidence of a sales arrangement exists, the price is fixed or determinable, title and risk of loss has transferred, calculability of the resulting receivable is reasonably assured, there are no customer acceptance requirements and we do not have any significant post-shipment obligations. The Company recognizes revenue on a sell-through basis for customer arrangements in which it does not have historical information to estimate product returns, pricing discounts or other concessions upon shipment. For these product shipments, the Company invoices the reseller, records deferred revenue at the gross invoice sales price and classifies the cost basis of the product held by the wholesaler as a component of inventory. Deferred revenue is adjusted for price protection and other revenue reserves. Revenue is recognized when product is sold by the reseller to the end user, on a first-in first-out (FIFO) basis. For customer arrangements in which returns, price discounts and other concessions can be reasonably estimated, revenue is recognized upon shipment and a reserve is recorded for returns, price discounts and other concessions. | |
Cost of Good Sold | Cost of Good Sold Costs of good sold includes direct costs related to the sale of the Company's iodine dietary supplement, write-downs of excess and obsolete inventories, and amortization of intangible assets. | |
Shipping and Handling Costs | Shipping and Handling Costs Shipping and handling costs are expensed as incurred and are included in cost of goods sold. | |
Research and Development Expenses | Research and Development Expenses Research and development expenses are expensed as incurred and consist primarily of personnel costs, including salaries, benefits and stock-based compensation, clinical studies performed by contract research organizations ("CROs"), consulting, materials, supplies, and facilities and other overhead allocations. | |
Advertising Expenses | Advertising Expenses The Company expenses the costs of advertising, including promotional expenses, as incurred. Advertising expenses were approximately $59,000 and $313,000 for the three months ended July 31, 2016 and 2015, respectively. Advertising expenses were approximately $278,000 and $549,000 for the six months ended July 31, 2016 and 2015, respectively. | Advertising Expenses The Company expenses the costs of advertising, including promotional expenses, as incurred. Advertising expenses were $1.2 million for year ended January 31, 2016, $90,000 for the one month ended January 31, 2015 and $68,000 for the year ended December 31, 2014. |
Income Taxes. | Income Taxes The Company accounts for income taxes using the liability method whereby deferred tax asset and liability account balances are determined based on differences between financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. Valuation allowances are established to reduce deferred tax assets when management estimates, based on available objective evidence, that it is more likely than not that the benefit will not be realized for the deferred tax assets. The Company's policy is to recognize interest and penalties accrued on any unrecognized tax benefits as a component of income tax expense. No interest expense was recognized during the periods presented. | |
Stock-Based Compensation | Stock-Based Compensation The Company recognizes stock-based compensation for equity awards on a straight-line basis over their vesting periods based on the grant date fair value. The Company estimates the fair value of stock options granted using the Black-Scholes pricing model. This model also requires subjective assumptions, including future stock price volatility and expected time to exercise, which greatly affect the calculated values. Equity instruments issued to non-employees are recorded at their fair value on the measurement date and are subject to periodic adjustment as the underlying equity instruments vest. | |
Comprehensive Loss | Comprehensive Loss Comprehensive loss is the change in equity of an enterprise, except those resulting from stockholder transactions. Accordingly, comprehensive loss includes certain changes in equity that are excluded from net loss. For the year ended January 31, 2016, one month ended January 31, 2015 and year ended December 31, 2014, the Company's comprehensive loss is equal to net loss. There were no components of other comprehensive loss for any of the periods presented. | |
Net Loss Per Share | Net Loss per Share Basic net loss per share attributable to common stockholders is calculated based on the weighted-average number of shares of the Company’s common stock outstanding during the period. The weighted average shares outstanding for the three and six months ended July 31, 2016 excludes 193,333 of unvested common stock. Diluted net loss per share attributable to common stockholders is calculated based on the weighted-average number of shares of the Company’s common stock outstanding and other dilutive securities outstanding during the period. The potential dilutive shares of common stock resulting from the assumed exercise of outstanding stock options, warrants and the assumed conversion of preferred stock are determined under the treasury stock method. For the three months ended July 31, 2016 and 2015, approximately 10,002,000 and 4,837,000 potentially dilutive securities, respectively, were excluded from the computation of diluted loss per share because their effect on net loss per share would be anti-dilutive. | Net Loss Per Share Basic net loss per share attributable to common stockholders is calculated based on the weighted-average number of shares of the Company's common stock outstanding during the period. Diluted net loss per share attributable to common stockholders is calculated based on the weighted-average number of shares of the Company's common stock outstanding and other dilutive securities outstanding during the period. The potential dilutive shares of common stock resulting from the assumed exercise of outstanding stock options, warrants and the assumed conversion of preferred stock are determined under the treasury stock method. As of January 31, 2016, January 31, 2015 and December 31, 2014, 5,741,000, 9,793,000 and 9,713,000 potentially dilutive securities, respectively, were excluded from the computation of diluted loss per share because their effect on net loss per share would be anti-dilutive. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In February 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2016-02, Leases, which requires entities to recognize assets and liabilities for leases with lease terms greater than twelve months. The new guidance also requires quantitative and qualitative disclosures regarding the amount, timing and uncertainty of cash flows arising from leases. The standard is effective for annual and interim periods beginning after December 15, 2018, with early adoption permitted upon issuance. The Company is in the process of evaluating the impact of adoption on its consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-09, Compensation — Stock Compensation: Improvements to Employee Share-Based Payment Accounting, which relates to the accounting for employee share-based payments. This standard provides guidance on simplifying several aspects of the accounting for employee share-based payment transactions, including the income tax consequences, accounting for forfeitures and classification of excess tax benefits on the statement of cash flows. This standard will be effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. The Company is in the process of evaluating the impact of adoption on its consolidated financial statements. In April 2016, the FASB issued ASU No. 2016-10, Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing, which addresses certain implementation issues that have surfaced since the issuance of ASU No. 2014-09 in May 2014. ASU No. 2016-10 provides guidance in identifying performance obligations and determining the appropriate accounting for licensing arrangements. This standard will be effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company is in the process of evaluating the impact of adoption on its consolidated financial statements. In May 2016, the FASB issued ASU No. 2016-12, Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients. ASU No. 2016-12 will affect all entities that enter into contracts with customers to transfer goods or services that are an output of the entity’s ordinary activities in exchange for consideration. The amendments in this update affect the guidance in ASU No. 2014-09 which is not yet effective. The amendments in this update also affect narrow aspects of Topic 606 including among others: assessing collectability criterion, noncash consideration, and presentation of sales taxes and other similar taxes collected from customers. The effective date of this update is the same as ASU No. 2014-09. The Company is in the process of evaluating the impact of adoption on its consolidated financial statements. | Recent Accounting Pronouncements In July 2015, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2015-11, Inventory (Topic 330), Simplifying the Measurement of Inventory, which applies to all inventory except that which is measured using last-in, first-out (LIFO) or the retail inventory method. Inventory measured using first-in, first-out (FIFO) or average cost is included in the new amendment. The amendment will take effect for public business entities for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. The Company is in the process of evaluating the impact of adoption on the its consolidated financial statements. In August 2015, FASB issued Accounting Standards Update No. 2015-14, Revenue from Contracts with Customers (ASU No. 2014-09). This update defers the effective dates of ASU No. 2014-09 (originally issued in June 2014) for public business entities by one year, or until annual reporting periods beginning after December 15, 2017, including interim reporting periods within the reporting period. ASU No. 2014-09 gives entities a single comprehensive model to use in reporting information about the amount and timing of revenue resulting from contracts to provide goods or services to customers. The proposed ASU, which would apply to any entity that enters into contracts to provide goods or services, would supersede the revenue recognition requirements in Topic 605, Revenue Recognition, and most industry-specific guidance throughout the Industry Topics of the Codification. Additionally, the update would supersede some cost guidance included in Subtopic 605-35, Revenue Recognition—Construction-Type and Production-Type Contracts. The update removes inconsistencies and weaknesses in revenue requirements and provides a more robust framework for addressing revenue issues and more useful information to users of financial statements through improved disclosure requirements. In addition, the update improves comparability of revenue recognition practices across entities, industries, jurisdictions, and capital markets and simplifies the preparation of financial statements by reducing the number of requirements to which an entity must refer. The Company is continuing to review the provisions of this ASU to determine if there will be any impact on its results of operations, cash flows or financial condition. In February 2016, FASB issued ASU No. 2016-02, Leases, which requires entities to recognize assets and liabilities for leases with lease terms greater than twelve months. The new guidance also requires quantitative and qualitative disclosures regarding the amount, timing and uncertainty of cash flows arising from leases. The standard is effective for annual and interim periods beginning after December 15, 2018, with early adoption permitted upon issuance. The Company is in process of evaluating the impact of adoption on its consolidated financial statements. In August 2014, FASB issued ASU No. 2014-15, Presentation of Financial Statements—Going Concern (Subtopic 205-40). This ASU provides guidance to determine when and how to disclose going-concern uncertainties in the financial statements. The new standard requires management to perform interim and annual assessments of an entity's ability to continue as a going concern within one year of the date that the financial statements are issued. An entity must provide certain disclosures if conditions or events raise substantial doubt about the entity's ability to continue as a going concern. This standard is effective for annual periods ending after December 15, 2016. The Company is evaluating the impact of the adoption of this ASU on its consolidated financial statements. The Company has reviewed other recent accounting pronouncements and concluded they are either not applicable to the business, or no material effect is expected on the consolidated financial statements as a result of future adoption. |
DESCRIPTION OF BUSINESS AND S20
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Jan. 31, 2016 | |
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Schedule of estimated useful lives of property and equipment | Description Estimated Useful Life Furniture 5 - 7 Laboratory equipment 3 - 5 Computer and equipment 3 - 5 Software 5 |
BALANCE SHEET DETAILS (Tables)
BALANCE SHEET DETAILS (Tables) | 6 Months Ended | 12 Months Ended |
Jul. 31, 2016 | Jan. 31, 2016 | |
BALANCE SHEET DETAILS | ||
Schedule of Inventories | July 31, January 31, (in thousands) Inventories: Work in process $ $ Finished goods Channel inventory Total $ $ | January 31, 2016 2015 (in thousands) Inventories: Work in process $ $ Finished goods Channel inventory $ $ |
Property and Equipment | January 31, 2016 2015 (in thousands) Property and equipment, net: Furniture $ $ Laboratory equipment Computer and equipment Software Less: accumulated depreciation ) ) $ $ | |
Schedule of Intangible assets | Intangible assets were as follows (dollar amounts in thousands): As of January 31, 2016 Estimated Useful Life Gross Value Accumulated Amortization Net Value Intangible assets 5 years $ $ ) $ As of January 31, 2015 Estimated Useful Life Gross Value Accumulated Amortization Net Value Intangible assets 5 years $ $ ) $ | |
Schedule of estimated aggregate future amortization expense in future years | As of January 31, 2016, the estimated aggregate future amortization expense in future years is as follows (in thousands): Years ending January 31: 2017 $ 2018 2019 2020 Total $ | |
Schedule Accrued liabilities | January 31, 2016 2015 (in thousands) Accrued liabilities: Payroll $ $ Research and development — Legal — Marketing — Deferred rent Deferred revenue Other $ $ |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 6 Months Ended | 12 Months Ended |
Jul. 31, 2016 | Jan. 31, 2016 | |
COMMITMENTS AND CONTINGENCIES | ||
Future minimum commitments | The following table summarizes the Company’s commitments as of July 31, 2016 (in thousands): Total 2017 2018 2019 2020 2021 Operating lease $ $ $ — $ — $ — $ — Purchase commitment Total $ $ $ $ $ $ | The following table summarizes the Company's commitments as of January 31, 2016 (in thousands): Total 2017 2018 2019 2020 2021 Operating lease $ $ $ — $ — $ — $ — Purchase commitment Total $ $ $ $ $ $ |
CONVERTIBLE REDEEMABLE PREFER23
CONVERTIBLE REDEEMABLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY (Tables) | 6 Months Ended | 12 Months Ended |
Jul. 31, 2016 | Jan. 31, 2016 | |
Schedule of significant ranges of outstanding and exercisable options | The following table summarizes significant ranges of outstanding and exercisable options as of July 31, 2016: Options Outstanding Options Vested and Exercisable Range of Exercise Price Number Weighted Weighted Number Weighted $0.25 - $0.62 $ $ $0.63 - $1.00 $ $ $1.01 - $1.67 $ $ $1.68 - $3.00 $ $ $3.01 - $3.25 $ $ $ $ | Options Outstanding Options Vested and Exercisable Range of Exercise Price Number Outstanding Weighted Average Remaining Contractual Life (in Years) Weighted Average Exercise Prices Number Vested and Exercisable Weighted Average Exercise Prices $0.25 - $1.00 $ $ $1.01 - $1.67 $ $ $1.68 - $3.00 $ $ $3.01 - $3.25 $ — — $ $ |
2014 Equity Incentive Plan | ||
Stock option plan activity | Available Shares Weighted Remaining Aggregate (in thousands) Outstanding as of January 1, 2016 $ $ Exercised — ) $ Cancelled ) $ Outstanding as of April 30 2016 $ $ Shares authorized for issuance — Granted ) $ Exercised — ) $ Cancelled ) $ Expired upon termination of the 2014 Plan ) — $ — Outstanding as of July 31, 2016 $ $ Vested and exercisable $ $ Vested and expected to vest $ $ | Available for Grant Shares Weighted Average Exercise Prices Remaining Contractual Life Aggregate Intrinsic Value (in thousands) Balance at January 1, 2013 $ Granted ) Balance at December 31, 2013 $ Additional shares authorized — — Granted ) Exercised — ) Cancelled ) Balance at December 31, 2014 $ $ Granted ) Exercised — ) Cancelled ) Balance at January 31, 2015 $ $ Granted ) Exercised — ) Cancelled ) Balance at January 31, 2016 $ $ Vested and exercisable $ $ Vested and expected to vest $ $ |
Outside the 2014 Equity Incentive Plan | ||
Stock option plan activity | Shares Weighted Remaining Aggregate (in thousands) Balance at January 31, 2016, April 30, 2016 and July 31, 2016 $ $ — Vested and exercisable — $ — — $ — Vested and expected to vest $ $ — | Shares Weighted Average Exercise Prices Remaining Contractual Life Aggregate Intrinsic Value (in thousands) Balance at January 31, 2015 — — — — Granted $ Balance at January 31, 2016 $ $ Vested and exercisable — $ — — $ — Vested and expected to vest $ $ |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 6 Months Ended | 12 Months Ended |
Jul. 31, 2016 | Jan. 31, 2016 | |
STOCK-BASED COMPENSATION | ||
Summary of stock based compensation expense | The following table summarizes the stock-based compensation expenses included in the unaudited condensed consolidated statement of operations and comprehensive loss (in thousands): For the three months ended For the six months ended 2016 2015 2016 2015 Research and development $ $ $ $ Sales and marketing General and administrative expenses Total $ $ $ $ | The following table summarizes the stock-based compensation expenses included in the Company's Statement of Operations and Comprehensive Loss for the periods ended (in thousands): Year ended January 31, One month ended January 31, Year ended December 31, 2016 2015 2014 Research and development $ $ Sales and marketing General and administrative Total $ $ $ |
Black-Scholes option pricing model fair value assumptions | For the three months ended For the six months ended 2016 2015 2016 2015 Expected volatility 97.0% - 98.6% 97.0% - 98.6% Expected term in years Risk-free interest rate 1.14% - 1.28% 1.14% - 1.28% 1.62% - 1.71% Expected dividend yield — — — — | Year ended January 31, One month ended January 31, Year ended December 31, 2016 2015 2014 Expected volatility 81.3% - 82.6% % % Expected term in years 6.0 Risk-free interest rate 1.57% - 2.26% % % Expected dividend yield —% — % — % |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Jan. 31, 2016 | |
INCOME TAXES | |
Summary of components of deferred tax assets | Significant components of the Company's deferred tax assets were as follows (in thousands): January 31, 2016 2015 Deferred tax assets: Net operating loss carryforwards $ $ Stock-based compensation expense — Tax credit carryforwards — Other Total deferred tax assets Less: Valuation allowance ) ) Net deferred tax assets $ — $ — |
Schedule of reconciliation of income taxes at the federal statutory rate to the actual income tax provision | A reconciliation of income taxes provided at the federal statutory rate (34%) to the actual income tax provision was as follows (in thousands): Year ended January 31, 2016 Income tax benefit computed at U.S. statutory rate $ ) State income tax (net of federal benefit) ) Stock-based compensation Warrant valuation Research and development credits ) Change in valuation allowance Other Income tax provision $ |
DESCRIPTION OF BUSINESS AND S26
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - OFFERINGS (Details) $ in Thousands | Jan. 23, 2014shares | Apr. 30, 2016USD ($) | Dec. 31, 2015USD ($) | Jun. 30, 2015USD ($) | Jul. 31, 2016USD ($)subsidiary | Jul. 31, 2015USD ($) | Jan. 31, 2016USD ($)item | Dec. 31, 2014shares | Jan. 31, 2015USD ($) |
Other Disclosures | |||||||||
Number of wholly owned subsidiaries | 1 | 1 | |||||||
Net proceeds from the sale of common stock | $ 13,316 | ||||||||
Net proceeds from the issuance of common stock and warrants | $ 3,583 | $ 7,821 | |||||||
Ownership interest held by BPMX Stockholders | 77.80% | ||||||||
FAIR VALUE MEASUREMENTS | |||||||||
Unrealized gains (losses) | 0 | ||||||||
Accounts Receivable, Net | |||||||||
Allowance For Doubtful Accounts | 0 | $ 0 | |||||||
Level 1 | |||||||||
FAIR VALUE MEASUREMENTS | |||||||||
Available-for-sale securities | $ 3,600 | ||||||||
BPMX | |||||||||
Other Disclosures | |||||||||
Ownership interest acquired in exchange | 100.00% | ||||||||
Common Stock | |||||||||
Other Disclosures | |||||||||
Thompson Designs, Inc. common stock assumed in conjunction with Share Exchange (in shares) | shares | 7,025,000 | 2,000,000 | |||||||
Private Placement | |||||||||
Other Disclosures | |||||||||
Net proceeds from the sale of common stock | $ 5,500 | ||||||||
Public Offering | |||||||||
Other Disclosures | |||||||||
Net proceeds from the sale of common stock | $ 7,800 | ||||||||
Net proceeds from the issuance of common stock and warrants | $ 3,600 | ||||||||
Public Offering | Subsequent event | |||||||||
Other Disclosures | |||||||||
Net proceeds from the issuance of common stock and warrants | $ 3,600 |
DESCRIPTION OF BUSINESS AND S27
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Property and Equipment (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||
Jan. 31, 2015 | Jul. 31, 2016 | Jul. 31, 2015 | Jul. 31, 2016 | Jul. 31, 2015 | Jan. 31, 2016 | Jan. 31, 2015 | Dec. 31, 2014 | |
Intangible Assets | ||||||||
Estimated Useful Life | 5 years | 5 years | ||||||
Restricted Cash | ||||||||
Restricted cash | $ 35,000 | |||||||
Marketing and Advertising Expense | ||||||||
Advertising expenses | $ 90,000 | $ 59,000 | $ 313,000 | $ 278,000 | $ 549,000 | 1,200,000 | $ 68,000 | |
Income Tax Uncertainties | ||||||||
Unrecognized tax benefits, interest on income tax expense | $ 0 | $ 0 | $ 0 | |||||
Furniture | Minimum | ||||||||
Property and Equipment | ||||||||
Estimated Useful Life | 5 years | |||||||
Furniture | Maximum | ||||||||
Property and Equipment | ||||||||
Estimated Useful Life | 7 years | |||||||
Laboratory equipment | Minimum | ||||||||
Property and Equipment | ||||||||
Estimated Useful Life | 3 years | |||||||
Laboratory equipment | Maximum | ||||||||
Property and Equipment | ||||||||
Estimated Useful Life | 5 years | |||||||
Computer and equipment | Minimum | ||||||||
Property and Equipment | ||||||||
Estimated Useful Life | 3 years | |||||||
Computer and equipment | Maximum | ||||||||
Property and Equipment | ||||||||
Estimated Useful Life | 5 years | |||||||
Software | ||||||||
Property and Equipment | ||||||||
Estimated Useful Life | 5 years |
DESCRIPTION OF BUSINESS AND S28
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Net Loss Per Share (Details) - shares | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||
Jan. 31, 2015 | Jul. 31, 2016 | Jul. 31, 2015 | Jan. 31, 2016 | Dec. 31, 2014 | |
Net Loss Per Share | |||||
Anti dilutive securities excluded from computation of diluted net loss per share | 9,793,000 | 10,002,000 | 4,837,000 | 5,741,000 | 9,713,000 |
GOING CONCERN (Details)
GOING CONCERN (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||||
Apr. 30, 2016 | Dec. 31, 2015 | Jun. 30, 2015 | Jan. 31, 2015 | Jul. 31, 2016 | Jul. 31, 2015 | Jul. 31, 2016 | Jul. 31, 2015 | Jan. 31, 2016 | Dec. 31, 2014 | |
Net proceeds from the sale of common stock | $ 13,316 | |||||||||
Net proceeds from the issuance of common stock and warrants | $ 3,583 | $ 7,821 | ||||||||
Maximum amount of securities to sell subject to regulatory limitation | 100,000 | |||||||||
Net loss | $ (1,144) | $ (5,034) | $ (3,571) | (9,495) | $ (7,195) | (15,598) | $ (7,807) | |||
Accumulated deficit | $ (10,634) | (35,727) | (35,727) | (26,232) | ||||||
Working capital | $ (3,500) | $ (3,500) | $ 1,600 | |||||||
Private Placement | ||||||||||
Net proceeds from the sale of common stock | $ 5,500 | |||||||||
Public Offering | ||||||||||
Net proceeds from the sale of common stock | $ 7,800 | |||||||||
Net proceeds from the issuance of common stock and warrants | $ 3,600 | |||||||||
Public Offering | Subsequent event | ||||||||||
Net proceeds from the issuance of common stock and warrants | $ 3,600 |
BALANCE SHEET DETAILS - Invento
BALANCE SHEET DETAILS - Inventories and Property and equipment, net (Details) - USD ($) $ in Thousands | 1 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jan. 31, 2015 | Jul. 31, 2016 | Jul. 31, 2015 | Jan. 31, 2016 | Dec. 31, 2014 | |
Inventories: | |||||
Work in process | $ 61 | $ 54 | $ 18 | ||
Finished goods | 64 | 17 | 28 | ||
Channel inventory | 35 | 41 | 54 | ||
Total | 160 | 112 | 100 | ||
Property and equipment, net: | |||||
Total | 266 | 304 | |||
Less: accumulated depreciation | (32) | (88) | |||
Property and equipment, net | 234 | 204 | 216 | ||
Depreciation | 1 | $ 33 | $ 21 | 56 | $ 25 |
Furniture | |||||
Property and equipment, net: | |||||
Total | 18 | 21 | |||
Laboratory equipment | |||||
Property and equipment, net: | |||||
Total | 26 | 27 | |||
Computer and equipment | |||||
Property and equipment, net: | |||||
Total | 78 | 112 | |||
Software | |||||
Property and equipment, net: | |||||
Total | $ 144 | $ 144 |
BALANCE SHEET DETAILS - Intangi
BALANCE SHEET DETAILS - Intangible assets, Amortization Expense, Accrued Liabilities (Details) - USD ($) | 1 Months Ended | 6 Months Ended | 12 Months Ended | |||
Jan. 31, 2015 | Jul. 31, 2016 | Jul. 31, 2015 | Jan. 31, 2016 | Jan. 31, 2015 | Dec. 31, 2014 | |
Intangible assets, net: | ||||||
Estimated Useful Life | 5 years | 5 years | ||||
Gross Value | $ 150,000 | $ 150,000 | $ 150,000 | |||
Accumulated Amortization | (1,000) | (31,000) | (1,000) | |||
Net Value | 149,000 | $ 104,000 | 119,000 | 149,000 | ||
Amortization expense | 1,000 | 15,000 | $ 15,000 | 30,000 | $ 0 | |
Finite-Lived Intangible Assets Estimated Amortization Expense in Future Years | ||||||
2,017 | 30,000 | |||||
2,018 | 30,000 | |||||
2,019 | 30,000 | |||||
2,020 | 29,000 | |||||
Total | $ 104,000 | 119,000 | ||||
Accrued liabilities: | ||||||
Payroll | 128,000 | 209,000 | 128,000 | |||
Research and development | 160,000 | |||||
Legal | 125,000 | |||||
Marketing | 74,000 | |||||
Deferred rent | 49,000 | 26,000 | 49,000 | |||
Deferred Revenue | 6,000 | 19,000 | 6,000 | |||
Other | 4,000 | 182,000 | 4,000 | |||
Total | $ 187,000 | $ 795,000 | $ 187,000 |
RELATED PARTY PAYABLES (Details
RELATED PARTY PAYABLES (Details) - USD ($) | Jul. 31, 2016 | Jan. 31, 2016 | Jan. 31, 2015 |
RELATED PARTY PAYABLES | |||
Related party payables | $ 104,000 | $ 225,000 | $ 218,000 |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Lease Arrangements (Details) | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||
Jan. 31, 2015USD ($) | Jul. 31, 2016USD ($) | Jul. 31, 2015USD ($) | Jul. 31, 2016USD ($) | Jul. 31, 2015USD ($) | Jan. 31, 2016USD ($)ft² | Dec. 31, 2014USD ($) | Aug. 23, 2013ft² | |
Operating lease commitments | ||||||||
2,017 | $ 99,000 | $ 99,000 | $ 246,000 | |||||
Total | 99,000 | 99,000 | 246,000 | |||||
Purchase commitments | ||||||||
2,017 | 316,000 | 316,000 | 421,000 | |||||
2,018 | 263,000 | 263,000 | 263,000 | |||||
2,019 | 263,000 | 263,000 | 263,000 | |||||
2,020 | 263,000 | 263,000 | 263,000 | |||||
2,021 | 263,000 | 263,000 | 263,000 | |||||
Total | 1,368,000 | 1,368,000 | 1,473,000 | |||||
Contractual obligation commitments | ||||||||
2,017 | 415,000 | 415,000 | 667,000 | |||||
2,018 | 263,000 | 263,000 | 263,000 | |||||
2,019 | 263,000 | 263,000 | 263,000 | |||||
2,020 | 263,000 | 263,000 | 263,000 | |||||
2,021 | 263,000 | 263,000 | 263,000 | |||||
Total | 1,467,000 | 1,467,000 | $ 1,719,000 | |||||
Rent expense | ||||||||
Leased office and laboratory space | ft² | 10,800 | 10,800 | ||||||
Rent expense | $ 26,000 | $ 86,000,000 | $ 94,000,000 | $ 172,000,000 | $ 172,000,000 | $ 357,000 | $ 310,000 |
COMMITMENTS AND CONTINGENCIES34
COMMITMENTS AND CONTINGENCIES - Legal Proceedings and License Agreement (Details) | 6 Months Ended | 12 Months Ended |
Jul. 31, 2016 | Jan. 31, 2016 | |
License Agreement | ||
Legal proceedings description | 5.00% | |
License Agreement | Iogen LLC | ||
License Agreement | ||
Non Royalty license fee equal to a certain percentage of net profit associated with OTC product | 30.00% | 30.00% |
Non Royalty license fee equal to a certain percentage of net royalties received from any sub-licensee | 30.00% | 30.00% |
License Agreement | Prescription Iodine Tablet | Iogen LLC | ||
License Agreement | ||
Royalty fee percentage based on net sales over a specific time period of commercialization | 3.00% | 3.00% |
Royalty fee percentage based on net sales after a specific period of time | 2.00% | 2.00% |
Time period for determining initial royalty fee as a percent of net sales | 24 months | 24 months |
License Agreement | Other Products | Iogen LLC | ||
License Agreement | ||
Royalty fee percentage based on net sales over a specific time period of commercialization | 3.00% | 3.00% |
Royalty fee percentage based on net sales from initial period until expiration of applicable patents | 2.00% | 2.00% |
Royalty fee percentage based on net sales after a specific period of time | 1.00% | 1.00% |
Time period for determining initial royalty fee as a percent of net sales | 12 months | 12 months |
COMMITMENTS AND CONTINGENCIES35
COMMITMENTS AND CONTINGENCIES - Intangible Assets (Details) - USD ($) | 6 Months Ended | 12 Months Ended | ||
Jul. 31, 2016 | Jan. 31, 2016 | Jan. 31, 2015 | Dec. 31, 2013 | |
Finite-Lived Intangible Assets | ||||
Fees to Iogen capitalized | $ 150,000 | $ 150,000 | ||
Intangible assets, net of amortization | $ 104,000 | 119,000 | ||
Royalties paid | $ 0 | 0 | ||
Intellectual Property | ||||
Finite-Lived Intangible Assets | ||||
Fees to Iogen capitalized | $ 150,000 | |||
Intangible assets, net of amortization | $ 119,000 | $ 149,000 |
CONVERTIBLE REDEEMABLE PREFER36
CONVERTIBLE REDEEMABLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY - Common Stock (Details) - USD ($) | Oct. 24, 2014 | Apr. 11, 2014 | Jan. 23, 2014 | Apr. 30, 2016 | Dec. 31, 2015 | Jun. 30, 2015 | Jan. 31, 2016 | Dec. 31, 2014 | Jul. 31, 2016 | Dec. 14, 2015 | Jan. 31, 2015 |
Net proceeds from the sale of common stock | $ 13,316,000 | ||||||||||
Shares issued | 25,208,684 | 28,881,351 | 11,415,416 | ||||||||
Stock expected to vest | 193,333 | ||||||||||
Common Stock | |||||||||||
Stock issued to BioPharmX shareholders | 7,025,000 | 2,000,000 | |||||||||
Stock issued on conversion of convertible notes | 1,526,001 | ||||||||||
Issuance of common stock | 12,508,395 | ||||||||||
Conversion of convertible notes payable to common stock (in shares) | 1,526,001 | ||||||||||
Korea Investment Partners | |||||||||||
Shares issued | 290,000 | ||||||||||
Stock vested | 96,667 | ||||||||||
Stock expected to vest | 193,333 | ||||||||||
Convertible Note | |||||||||||
Interest rate on convertible notes | 6.00% | ||||||||||
Principal amount | $ 500,000 | ||||||||||
Conversion of convertible notes payable to common stock (in shares) | 182,266 | ||||||||||
Public Offering | |||||||||||
Issuance of common stock | 3,600,000 | 3,636,384 | |||||||||
Net proceeds from the sale of common stock | $ 7,800,000 | ||||||||||
Price per share | $ 1.195 | ||||||||||
Private Placement | |||||||||||
Net proceeds from the sale of common stock | $ 5,500,000 | ||||||||||
Korea Investment Partners | Subscription Agreement | Common Stock | |||||||||||
Revenue from Violet | $ 2,000,000 | 2,000,000 | |||||||||
Subscription agreement receivable | $ 2,000,000 | $ 2,000,000 | |||||||||
Price per share | $ 1.85 | ||||||||||
Shares issued | 1,081,081 | ||||||||||
Korea Investment Partners | Subscription Agreement | Common Stock | Minimum | |||||||||||
Price per share | $ 3.70 | $ 3.70 | |||||||||
Franklin Advisers | Private Placement | |||||||||||
Issuance of common stock | 4,100,000 | ||||||||||
Net proceeds from the sale of common stock | $ 5,500,000 | ||||||||||
Price per share | $ 1.43 | ||||||||||
Period within which securities can be purchased | 5 years | ||||||||||
Franklin Advisers | Private Placement | Maximum | |||||||||||
Percentage of securities offered by entity | 20.00% |
CONVERTIBLE REDEEMABLE PREFER37
CONVERTIBLE REDEEMABLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY - Series A Preferred Stock (Details) | May 15, 2014USD ($)$ / sharesshares | May 14, 2014USD ($)$ / sharesshares | Apr. 30, 2016$ / sharesshares | Jan. 31, 2016USD ($)shares | Jun. 30, 2015$ / sharesshares | Apr. 30, 2015USD ($)$ / shares | Jul. 31, 2015USD ($) | Jan. 31, 2016USD ($)shares | Dec. 31, 2014USD ($)item$ / sharesshares | Jul. 31, 2016shares | Mar. 31, 2015$ / shares | Oct. 24, 2014$ / shares |
Equity | ||||||||||||
Proceeds from warrant exercises | $ | $ 1,512,000 | $ 1,487,000 | ||||||||||
Incremental fair value of warrants | $ | $ 436,000 | $ 436,000 | ||||||||||
Adjustment to paid-in capital, warrant fair value | $ | $ 204,000 | |||||||||||
Public Offering | ||||||||||||
Equity | ||||||||||||
Price per share | $ / shares | $ 1.195 | |||||||||||
Number of shares of common stock subject to warrant | 1,952,000 | |||||||||||
Warrants exercise price | $ / shares | $ 1.20 | |||||||||||
Issuance of common stock, net of expenses of $2,500 (in shares) | 3,600,000 | 3,636,384 | ||||||||||
Warrant | Public Offering | Underwriters | ||||||||||||
Equity | ||||||||||||
Number of shares of common stock subject to warrant | 109,091 | |||||||||||
Warrants exercise price | $ / shares | $ 2.75 | |||||||||||
Warrants expiration term | 5 years | |||||||||||
Series A Warrant | Warrant | ||||||||||||
Equity | ||||||||||||
Number of shares of common stock subject to warrant | 2,042,589 | |||||||||||
Warrants exercise price | $ / shares | $ 3.70 | |||||||||||
Adjustment to paid-in capital, warrant fair value | $ | $ 845,000 | |||||||||||
Dividend rate | 0.00% | |||||||||||
Contractual term | 5 years | |||||||||||
Expected volatility | 88.80% | |||||||||||
Series A Warrant | Warrant | Minimum | ||||||||||||
Equity | ||||||||||||
Risk-free rate | 1.60% | |||||||||||
Series A Warrant | Warrant | Maximum | ||||||||||||
Equity | ||||||||||||
Risk-free rate | 4.00% | |||||||||||
Common Stock | Subscription Agreement | Korea Investment Partners | ||||||||||||
Equity | ||||||||||||
Price per share | $ / shares | $ 1.85 | |||||||||||
Common Stock | Subscription Agreement | Minimum | Korea Investment Partners | ||||||||||||
Equity | ||||||||||||
Price per share | $ / shares | $ 3.70 | $ 3.70 | ||||||||||
Series A Convertible Redeemable Preferred Stock | ||||||||||||
Equity | ||||||||||||
Number of shares sold | 4,207,987 | |||||||||||
Price per share | $ / shares | $ 1.85 | |||||||||||
Gross proceeds from issuance | $ | $ 7,500,000 | |||||||||||
Series A Convertible Redeemable Preferred Stock | Subscription Agreement | ||||||||||||
Equity | ||||||||||||
Number of shares sold | 4,207,987 | |||||||||||
Series A Convertible Redeemable Preferred Stock | Public Offering | ||||||||||||
Equity | ||||||||||||
Number of common shares into which share is convertible | 4,319,426 | |||||||||||
Series A Convertible Redeemable Preferred Stock | Series A Warrant | ||||||||||||
Equity | ||||||||||||
Number of purchasers of stock | item | 47 | |||||||||||
Number of shares of common stock subject to warrant | 564,662 | 564,662 | ||||||||||
Proceeds from warrant exercises | $ | $ 1,411,655 | $ 1,411,655 | ||||||||||
Incremental fair value of warrants | $ | $ 436,000 | |||||||||||
Series A Convertible Redeemable Preferred Stock | Series A Warrant | Actual | ||||||||||||
Equity | ||||||||||||
Warrants exercise price | $ / shares | $ 2.50 | |||||||||||
Series A Convertible Redeemable Preferred Stock | Series A Warrant | Previously Reported | ||||||||||||
Equity | ||||||||||||
Warrants exercise price | $ / shares | $ 3.70 | $ 3.70 | ||||||||||
Series A Convertible Redeemable Preferred Stock | Series A Warrant | Public Offering | ||||||||||||
Equity | ||||||||||||
Offering price per share that triggers the issuance of additional shares related to the public offering | $ / shares | $ 3.125 | |||||||||||
Percentage of public offering price | 80.00% | |||||||||||
Issuance of common stock, net of expenses of $2,500 (in shares) | 77,006 | |||||||||||
Series A Convertible Redeemable Preferred Stock | Series A Warrant | Warrant | ||||||||||||
Equity | ||||||||||||
Number of shares of common stock subject to warrant | 1,661,055 | 1,661,055 | 1,661,055 | |||||||||
Dividend rate | 0.00% | |||||||||||
Risk-free rate | 1.60% | |||||||||||
Expected volatility | 85.90% | |||||||||||
Series A Convertible Redeemable Preferred Stock | Series A Warrant | Warrant | Minimum | ||||||||||||
Equity | ||||||||||||
Contractual term | 4 years | |||||||||||
Series A Convertible Redeemable Preferred Stock | Series A Warrant | Warrant | Maximum | ||||||||||||
Equity | ||||||||||||
Contractual term | 5 years | |||||||||||
Series A Convertible Redeemable Preferred Stock | Service Provider Warrant | Warrant | ||||||||||||
Equity | ||||||||||||
Number of shares of common stock subject to warrant | 316,395 | |||||||||||
Warrants exercise price | $ / shares | $ 2.035 | |||||||||||
Warrant expense | $ | $ 99,000 | |||||||||||
Series A Convertible Redeemable Preferred Stock | Convertible Debt Warrant | Warrant | ||||||||||||
Equity | ||||||||||||
Conversion of convertible notes payable to common stock (in shares) | 54,054 | |||||||||||
Number of shares of common stock subject to warrant | 343,559 | 289,505 | 289,505 | 289,505 | ||||||||
Warrants exercise price | $ / shares | $ 1.85 | |||||||||||
Adjustment to paid-in capital, warrant fair value | $ | $ 105,000 | |||||||||||
Contractual term | 5 years | 5 years |
CONVERTIBLE REDEEMABLE PREFER38
CONVERTIBLE REDEEMABLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY - Equity Incentive Plan (Details) - 2014 Equity Incentive Plan - shares | 12 Months Ended | ||
Jan. 31, 2016 | Nov. 07, 2014 | Jan. 23, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award | |||
Number of shares reserved and available for grant | 4,500,000 | 2,700,000 | |
Options | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Expiration period | 10 years | ||
Minimum | Options | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Vesting period | 2 years | ||
Maximum | Options | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Vesting period | 4 years |
CONVERTIBLE REDEEMABLE PREFER39
CONVERTIBLE REDEEMABLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY - Stock Option Activities (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Jan. 31, 2015 | Jul. 31, 2016 | Apr. 30, 2016 | Jul. 31, 2016 | Jan. 31, 2016 | Dec. 31, 2014 | Dec. 31, 2013 | |
Weighted Average Exercise Prices | |||||||
Granted | $ 1.92 | $ 1.44 | $ 1.10 | ||||
2014 Equity Incentive Plan | |||||||
Available for Grant | |||||||
Available for grant, beginning | 1,163,000 | 350,875 | 350,875 | 1,043,000 | 94,000 | 1,550,000 | |
Additional shares authorized | 1,800,000 | ||||||
Granted | (130,000) | (1,274,000) | (891,000) | (1,456,000) | |||
Cancelled | 10,000 | 581,875 | 160,000 | ||||
Available for grant, ending | 1,043,000 | 350,875 | 1,163,000 | 94,000 | |||
Shares | |||||||
Outstanding, Beginning | 2,609,357 | 2,704,608 | 2,704,608 | 2,689,252 | 2,606,000 | 1,150,000 | |
Granted | 130,000 | 1,274,000 | 891,000 | 1,456,000 | |||
Exercised | (40,105) | (676,769) | (727,643) | ||||
Cancelled | (10,000) | (581,875) | (160,000) | ||||
Outstanding, Ending | 2,689,252 | 2,704,608 | 2,609,357 | 2,606,000 | |||
Vested and exercisable | 1,059,709 | ||||||
Vested and expected to vest | 2,467,713 | ||||||
Weighted Average Exercise Prices | |||||||
Outstanding, Beginning | $ 0.82 | $ 1.59 | $ 1.59 | $ 0.91 | $ 0.25 | $ 0.06 | |
Granted | 2.75 | 2.25 | 1.85 | 0.40 | |||
Exercised | 0.95 | 0.12 | 0.14 | ||||
Cancelled | 1.85 | 1.59 | 0.37 | ||||
Outstanding, Ending | $ 0.91 | 1.59 | $ 0.82 | $ 0.25 | |||
Vested and exercisable | 1.13 | ||||||
Vested and expected to vest | $ 1.55 | ||||||
Remaining Contractual Life | |||||||
Outstanding | 8 years 6 months 29 days | 8 years 4 months 13 days | 8 years 6 months 7 days | ||||
Vested and exercisable | 7 years 4 months 2 days | ||||||
Vested and expected to vest | 8 years 3 months 15 days | ||||||
Aggregate Intrinsic Value | |||||||
Outstanding | $ 5,625 | $ 1,343 | $ 5,686 | ||||
Vested and exercisable | 794 | ||||||
Vested and expected to vest | $ 1,287 | ||||||
Outside the 2014 Equity Incentive Plan | |||||||
Available for Grant | |||||||
Granted | (660,000) | ||||||
Shares | |||||||
Outstanding, Beginning | 660,000 | 660,000 | 660,000 | ||||
Granted | 660,000 | ||||||
Outstanding, Ending | 660,000 | 660,000 | 660,000 | 660,000 | |||
Vested and expected to vest | 561,692 | 561,692 | 529,212 | ||||
Weighted Average Exercise Prices | |||||||
Outstanding, Beginning | $ 1.44 | $ 1.44 | $ 1.44 | ||||
Granted | $ 1.44 | ||||||
Outstanding, Ending | 1.44 | $ 1.44 | 1.44 | 1.44 | |||
Vested and expected to vest | $ 1.44 | $ 1.44 | $ 1.44 | ||||
Remaining Contractual Life | |||||||
Outstanding | 9 years 2 months 19 days | 9 years 2 months 19 days | 9 years 8 months 19 days | ||||
Vested and expected to vest | 9 years 2 months 19 days | 9 years 8 months 19 days | |||||
Aggregate Intrinsic Value | |||||||
Outstanding | $ 227 | ||||||
Vested and expected to vest | $ 182 | ||||||
Outside the 2014 Equity Incentive Plan | First anniversary | |||||||
Available for Grant | |||||||
Vesting percentage | 25.00% | 25.00% | |||||
Outside the 2014 Equity Incentive Plan | Subsequent to first anniversary | |||||||
Available for Grant | |||||||
Vesting percentage | 2.083% | 2.083% |
CONVERTIBLE REDEEMABLE PREFER40
CONVERTIBLE REDEEMABLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY - Range of Exercise Price (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||
Jan. 31, 2015 | Jul. 31, 2016 | Apr. 30, 2016 | Jul. 31, 2015 | Jul. 31, 2016 | Jul. 31, 2015 | Jan. 31, 2016 | Dec. 31, 2014 | |
Options Outstanding | ||||||||
Number Outstanding (in shares) | 5,481,025 | 3,364,608 | ||||||
Weighted Average Remaining Contractual Life | 8 years 11 months 19 days | 8 years 7 months 17 days | ||||||
Weighted Average Exercise Prices (in dollars per share) | $ 1 | $ 1.56 | ||||||
Options Exercisable | ||||||||
Number Vested and Exercisable (in shares) | 1,547,679 | 1,059,709 | ||||||
Weighted Average Exercise Prices (in dollars per share) | $ 1.12 | $ 1.13 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures | ||||||||
Total intrinsic value of options exercised | $ 82,000 | $ 5,000 | $ 1,200,000 | $ 39,000 | $ 1,300,000 | $ 1,400,000 | $ 676,000 | |
Weighted average exercise price of Granted shares | $ 1.92 | $ 1.44 | $ 1.10 | |||||
$0.25 - $1.00 | ||||||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range | ||||||||
Exercise prices, low end of range (in dollars per share) | $ 0.25 | 0.25 | ||||||
Exercise prices, high end of range (in dollars per share) | $ 0.62 | $ 1 | ||||||
Options Outstanding | ||||||||
Number Outstanding (in shares) | 2,547,259 | 2,547,259 | 882,108 | |||||
Weighted Average Remaining Contractual Life | 9 years 18 days | 7 years 5 months 23 days | ||||||
Weighted Average Exercise Prices (in dollars per share) | $ 0.54 | $ 0.54 | $ 0.41 | |||||
Options Exercisable | ||||||||
Number Vested and Exercisable (in shares) | 781,418 | 781,418 | 570,340 | |||||
Weighted Average Exercise Prices (in dollars per share) | $ 0.42 | $ 0.42 | $ 0.41 | |||||
$1.01 - $1.67 | ||||||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range | ||||||||
Exercise prices, low end of range (in dollars per share) | 0.63 | 1.01 | ||||||
Exercise prices, high end of range (in dollars per share) | $ 1 | $ 1.67 | ||||||
Options Outstanding | ||||||||
Number Outstanding (in shares) | 887,100 | 887,100 | 1,264,000 | |||||
Weighted Average Remaining Contractual Life | 9 years 6 months 22 days | 9 years 8 months 27 days | ||||||
Weighted Average Exercise Prices (in dollars per share) | $ 0.73 | $ 0.73 | $ 1.49 | |||||
Options Exercisable | ||||||||
Number Vested and Exercisable (in shares) | 108,332 | 108,332 | 51,664 | |||||
Weighted Average Exercise Prices (in dollars per share) | $ 0.96 | $ 0.96 | $ 1.48 | |||||
$1.68 - $3.00 | ||||||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range | ||||||||
Exercise prices, low end of range (in dollars per share) | 1.01 | 1.68 | ||||||
Exercise prices, high end of range (in dollars per share) | $ 1.67 | $ 3 | ||||||
Options Outstanding | ||||||||
Number Outstanding (in shares) | 1,365,666 | 1,365,666 | 988,500 | |||||
Weighted Average Remaining Contractual Life | 9 years 1 month 13 days | 8 years 1 month 2 days | ||||||
Weighted Average Exercise Prices (in dollars per share) | $ 1.52 | $ 1.52 | $ 2.28 | |||||
Options Exercisable | ||||||||
Number Vested and Exercisable (in shares) | 209,890 | 209,890 | 437,705 | |||||
Weighted Average Exercise Prices (in dollars per share) | $ 1.57 | $ 1.57 | $ 2.02 | |||||
$3.01 - $3.25 | ||||||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range | ||||||||
Exercise prices, low end of range (in dollars per share) | 1.68 | 3.01 | ||||||
Exercise prices, high end of range (in dollars per share) | $ 3 | $ 3.25 | ||||||
Options Outstanding | ||||||||
Number Outstanding (in shares) | 636,000 | 636,000 | 230,000 | |||||
Weighted Average Remaining Contractual Life | 8 years 1 month 13 days | 9 years 3 months 29 days | ||||||
Weighted Average Exercise Prices (in dollars per share) | $ 2.04 | $ 2.04 | $ 3.25 | |||||
Options Exercisable | ||||||||
Number Vested and Exercisable (in shares) | 403,039 | 403,039 | ||||||
Weighted Average Exercise Prices (in dollars per share) | $ 2.06 | $ 2.06 |
STOCK-BASED COMPENSATION - Expe
STOCK-BASED COMPENSATION - Expense (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Jan. 31, 2015 | Jul. 31, 2016 | Jul. 31, 2015 | Jul. 31, 2016 | Jul. 31, 2015 | Jan. 31, 2016 | Dec. 31, 2014 | |
Share-based Compensation | |||||||
Stock-based compensation expense | $ 99 | $ 424 | $ 324 | $ 697 | $ 624 | $ 1,214 | $ 1,193 |
Total compensation costs not yet recognized | 2,700 | $ 2,700 | $ 2,700 | ||||
Average remaining amortization period for recognition of expense | 2 years 9 months 4 days | 3 years 7 days | |||||
Research and Development | |||||||
Share-based Compensation | |||||||
Stock-based compensation expense | 27 | 129 | 39 | $ 205 | 125 | $ 256 | 228 |
Sales and Marketing | |||||||
Share-based Compensation | |||||||
Stock-based compensation expense | 40 | 98 | 83 | 182 | 207 | 443 | 147 |
General and Administrative | |||||||
Share-based Compensation | |||||||
Stock-based compensation expense | $ 32 | $ 197 | $ 202 | $ 310 | $ 292 | $ 515 | $ 818 |
STOCK-BASED COMPENSATION - Assu
STOCK-BASED COMPENSATION - Assumptions (Details) | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Jan. 31, 2015 | Jul. 31, 2016 | Jul. 31, 2015 | Jul. 31, 2016 | Jul. 31, 2015 | Jan. 31, 2016 | Dec. 31, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award | |||||||
Expected volatility | 82.10% | 82.60% | 82.60% | 82.20% | |||
Expected term in years | 6 years | 6 years 6 months | 6 years | 6 years 6 months | 6 years | 6 years | |
Risk-free interest rate | 1.56% | 1.71% | 1.74% | ||||
Minimum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||||
Expected volatility | 97.00% | 97.00% | 81.30% | ||||
Risk-free interest rate | 1.14% | 1.14% | 1.62% | 1.57% | |||
Maximum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||||
Expected volatility | 98.60% | 98.60% | 82.60% | ||||
Expected term in years | 6 years | ||||||
Risk-free interest rate | 1.28% | 1.28% | 1.71% | 2.26% |
EMPLOYEE BENEFIT PLAN (Details)
EMPLOYEE BENEFIT PLAN (Details) - USD ($) | 1 Months Ended | 12 Months Ended | |
Jan. 31, 2015 | Jan. 31, 2016 | Dec. 31, 2014 | |
EMPLOYEE BENEFIT PLAN | |||
Employee maximum contribution percentage | 100.00% | ||
Employer discretionary contribution amount | $ 0 | $ 0 | $ 0 |
INCOME TAXES - NOL Carry-forwar
INCOME TAXES - NOL Carry-forwards (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |
Jan. 31, 2015 | Jan. 31, 2016 | Dec. 31, 2014 | |
Federal income taxes | $ 0 | $ 0 | $ 0 |
Increase in valuation allowance | $ 400 | 5,200 | $ 2,600 |
Federal | |||
Operating loss carryforwards | $ 19,400 | ||
Expiration year | Dec. 31, 2030 | ||
State | California | |||
Operating loss carryforwards | $ 19,400 | ||
Expiration year | Dec. 31, 2030 |
INCOME TAXES - Components of De
INCOME TAXES - Components of Deferred Tax Assets (Details) - USD ($) $ in Thousands | Jan. 31, 2016 | Jan. 31, 2015 |
Deferred tax assets: | ||
Net operating loss carryforwards | $ 7,727 | $ 3,538 |
Stock-based compensation expense | 577 | |
Tax credit carryforwards | 311 | |
Other | 216 | 50 |
Total deferred tax assets | 8,831 | 3,588 |
Less: Valuation allowance | $ (8,831) | $ (3,588) |
INCOME TAXES - Reconciliation o
INCOME TAXES - Reconciliation of Income Tax Provision (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jul. 31, 2016 | Jan. 31, 2016 | |
INCOME TAXES | ||
Federal statutory rate | 34.00% | |
Reconciliation of income taxes: | ||
Income tax benefit computed at U.S. statutory rate | $ (5,302) | |
State income tax (net of federal benefit) | (838) | |
Stock-based compensation | 200 | |
Warrant valuation | 148 | |
Research and development credits | (128) | |
Change in valuation allowance | 5,904 | |
Other | 20 | |
Income tax provision | $ 2 | $ 4 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 6 Months Ended | 12 Months Ended | ||
Apr. 30, 2016 | Jun. 30, 2015 | Jul. 31, 2016 | Jul. 31, 2015 | Jan. 31, 2016 | |
Subsequent Event | |||||
Net proceeds from the issuance of common stock and warrants | $ 3,583 | $ 7,821 | |||
Public Offering | |||||
Subsequent Event | |||||
Net proceeds from the issuance of common stock and warrants | $ 3,600 | ||||
Issuance of common stock | 3,600,000 | 3,636,384 | |||
Warrants exercise price | $ 1.20 | ||||
Common Stock | |||||
Subsequent Event | |||||
Issuance costs | $ 2,500 | ||||
Subsequent event | Public Offering | |||||
Subsequent Event | |||||
Net proceeds from the issuance of common stock and warrants | $ 3,600 | ||||
Issuance costs | $ 700 | ||||
Issuance of common stock | 3,600,000 | ||||
Issuance of warrants | 1,952,000 | ||||
Warrants exercise price | $ 1.20 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (unaudited) - USD ($) | Jul. 31, 2016 | Jan. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 436,000 | $ 4,039,000 |
Accounts receivable, net | 1,000 | 7,000 |
Inventories | 112,000 | 100,000 |
Prepaid expenses and other current assets | 475,000 | 285,000 |
Total current assets | 1,024,000 | 4,431,000 |
Property and equipment, net | 204,000 | 216,000 |
Intangible assets, net | 104,000 | 119,000 |
Other assets | 50,000 | 50,000 |
Restricted cash | 35,000 | |
Total assets | 1,382,000 | 4,851,000 |
Current liabilities: | ||
Accounts payable | 3,416,000 | 1,777,000 |
Accrued expenses and other current liabilities | 998,000 | 795,000 |
Related party payables | 104,000 | 225,000 |
Total current liabilities | 4,518,000 | 2,797,000 |
Commitments and contingencies (Note 6) | ||
Stockholders' equity (deficit) | ||
Common stock, $0.001 par value; 90,000,000 shares authorized; 28,881,351 and 25,208,684 shares issued and outstanding at July 31, 2016 and January 31, 2016, respectively | 29,000 | 25,000 |
Additional paid in capital | 32,562,000 | 28,261,000 |
Accumulated equity deficit | (35,727,000) | (26,232,000) |
Total stockholders' equity (deficit) | (3,136,000) | 2,054,000 |
Total liabilities, convertible redeemable preferred stock and stockholders' equity (deficit) | 1,382,000 | 4,851,000 |
Series A Convertible Redeemable Preferred Stock | ||
Current liabilities: | ||
Series A convertible redeemable preferred stock, $0.001 par value; 10,000,000 shares authorized; none outstanding |
Condensed Consolidated Balanc49
Condensed Consolidated Balance Sheets (unaudited) (Parenthetical) - $ / shares | Jul. 31, 2016 | Jan. 31, 2016 | Jan. 31, 2015 | Dec. 31, 2014 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | $ 0.001 | |
Common stock, shares authorized | 90,000,000 | 90,000,000 | 90,000,000 | |
Common stock, issued | 28,881,351 | 25,208,684 | 11,415,416 | |
Common stock, shares outstanding | 28,881,351 | 25,208,684 | 11,415,416 | |
Series A Convertible Redeemable Preferred Stock | ||||
Par value (in dollars per share) | $ 0.001 | $ 0.001 | $ 0.001 | |
Shares authorized | 10,000,000 | 10,000,000 | 10,000,000 | |
Shares outstanding | 0 | 0 | 4,207,987 | 4,207,987 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Loss (unaudited) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Jan. 31, 2015 | Jul. 31, 2016 | Jul. 31, 2015 | Jul. 31, 2016 | Jul. 31, 2015 | Jan. 31, 2016 | Dec. 31, 2014 | |
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS | |||||||
Revenues, net | $ 1 | $ 19 | $ 5 | $ 52 | $ 9 | $ 64 | |
Cost of goods sold | 1 | 17 | 10 | 37 | 19 | 237 | |
Gross deficit | 2 | (5) | 15 | (10) | (173) | ||
Operating expenses: | |||||||
Research and development | 365 | 2,973 | 1,141 | 5,146 | 2,217 | 5,702 | $ 2,519 |
Sales and marketing | 378 | 895 | 1,307 | 2,002 | 2,388 | 5,109 | 2,299 |
General and administrative | 401 | 1,169 | 1,118 | 2,362 | 2,144 | 4,174 | 2,953 |
Total operating expenses | 1,144 | 5,037 | 3,566 | 9,510 | 6,749 | 14,985 | 7,771 |
Loss from operations | (1,144) | (5,035) | (3,571) | (9,495) | (6,759) | (15,158) | (7,771) |
Other income (expense), net | 1 | 2 | (436) | (436) | 40 | ||
Loss before income taxes | (1,144) | (5,034) | (3,571) | (9,493) | (7,195) | (15,594) | (7,807) |
Provision for income taxes | 2 | 4 | |||||
Net and comprehensive loss | (1,144) | (5,034) | (3,571) | (9,495) | (7,195) | (15,598) | (7,807) |
Accretion on Series A convertible redeemable preferred stock | (43) | (79) | (202) | (202) | (163) | ||
Deemed dividend on Series A convertible redeemable preferred stock | (50) | (85) | (201) | (201) | (159) | ||
Net loss available to common stockholders | $ (1,237) | $ (5,034) | $ (3,735) | $ (9,495) | $ (7,598) | $ (16,001) | $ (8,129) |
Basic and diluted net loss available to common stockholders per share | $ (0.11) | $ (0.18) | $ (0.24) | $ (0.35) | $ (0.56) | $ (0.89) | $ (0.80) |
Shares used in computing basic and diluted net loss per share | 11,408,000 | 28,674,000 | 15,443,000 | 27,459,000 | 13,616,000 | 17,950,000 | 10,217,000 |
Condensed Consolidated Statem51
Condensed Consolidated Statements of Cash Flows (unaudited) - USD ($) | 1 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jan. 31, 2015 | Jul. 31, 2016 | Jul. 31, 2015 | Jan. 31, 2016 | Dec. 31, 2014 | |
Cash flows from operating activities: | |||||
Net loss | $ (1,144,000) | $ (9,495,000) | $ (7,195,000) | $ (15,598,000) | $ (7,807,000) |
Adjustments to reconcile net loss to net cash used in operating activities: | |||||
Stock-based compensation expense | 99,000 | 697,000 | 624,000 | 1,214,000 | 1,193,000 |
Expense related to modification of warrants | 436,000 | 436,000 | |||
Depreciation expense | 1,000 | 33,000 | 21,000 | 56,000 | 25,000 |
Amortization expense | 1,000 | 15,000 | 15,000 | 30,000 | 0 |
Changes in assets and liabilities: | |||||
Accounts receivable | 1,000 | 6,000 | (32,000) | (6,000) | (2,000) |
Inventories | (22,000) | (12,000) | (204,000) | 60,000 | (138,000) |
Prepaid expenses and other assets | 30,000 | (190,000) | (175,000) | (46,000) | (133,000) |
Accounts payable | 666,000 | 1,639,000 | 2,177,000 | 625,000 | 257,000 |
Accrued expenses and other liabilities | (495,000) | 203,000 | 563,000 | 608,000 | 355,000 |
Related party payables | 19,000 | (121,000) | 8,000 | 7,000 | 74,000 |
Net cash used in operating activities | (844,000) | (7,225,000) | (3,762,000) | (12,614,000) | (6,001,000) |
Cash flows from investing activities: | |||||
Change in restricted cash | 35,000 | (35,000) | |||
Purchase of property and equipment | (21,000) | (13,000) | (38,000) | (228,000) | |
Net cash used in investing activities | 14,000 | (13,000) | (38,000) | (263,000) | |
Cash flows from financing activities: | |||||
Net proceeds from the issuance of common stock and warrants | 3,583,000 | 7,821,000 | |||
Proceeds from exercises of stock options | 38,000 | 25,000 | 25,000 | 83,000 | 99,000 |
Proceeds from exercise of common stock warrants | 1,512,000 | 1,487,000 | |||
Proceeds from Convertible Debt | 500,000 | 500,000 | 1,020,000 | ||
Net cash provided by financing activities | 38,000 | 3,608,000 | 9,858,000 | 15,386,000 | 8,372,000 |
Net increase (decrease) in cash and cash equivalents | (806,000) | (3,603,000) | 6,083,000 | 2,734,000 | 2,108,000 |
Cash and cash equivalents at beginning of year | 2,111,000 | 4,039,000 | 1,305,000 | 1,305,000 | 3,000 |
Cash and cash equivalents at end of year | $ 1,305,000 | $ 436,000 | $ 7,388,000 | $ 4,039,000 | $ 2,111,000 |
DESCRIPTION OF BUSINESS AND S52
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended | 12 Months Ended |
Jul. 31, 2016 | Jan. 31, 2016 | |
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 1. DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Description of Business BioPharmX Corporation (the “Company”) is incorporated under the laws of the state of Delaware and originally incorporated on August 30, 2010 in Nevada under the name Thompson Designs, Inc. The Company has one wholly-owned subsidiary, BioPharmX, Inc., a Nevada corporation. The Company is a specialty pharmaceutical company focused on utilizing its proprietary drug delivery technologies to develop and commercialize novel prescription and over-the-counter, or OTC, products that address large markets in women’s health and dermatology. The Company’s objective is to develop products that treat health or age-related conditions that (1) are not presently being addressed or treated or (2) are currently treated with drug therapies or drug delivery approaches that are suboptimal. The Company’s strategy is designed to bring new products to market by identifying optimal delivery mechanisms and/or alternative applications for FDA-approved active pharmaceutical ingredients, or APIs, and biological materials, while in appropriate circumstances, reducing the time, cost and risk typically associated with new product development by repurposing drugs with demonstrated safety profiles and taking advantage of the regulatory approval pathway under Section 505(b)(2) of the Federal Food, Drug and Cosmetic Act available for repurposed/reformulated drugs. The Company believes the 505(b)(2) regulatory pathway may reduce drug development risk and could reduce the time and resources it spends during development. Since the Company’s inception, substantially all of the Company’s efforts have been devoted to developing its product candidates, including conducting preclinical and clinical trials, and providing general and administrative support for its operations. The Company commercially launched its breast health supplement at the end of 2014, although to-date the Company has not generated significant revenue from product sales. The Company is not dependent on sales to any one customer. The Company has financed its operations primarily through the sale of equity and convertible debt securities. In June 2015, the Company raised $7.8 million through the sale of its common stock in a public offering and concurrently completed an uplisting to the NYSE MKT. In December 2015 the Company raised net proceeds of $5.5 million in a private offering of its common stock and, in April 2016, it raised net proceeds of approximately $3.6 million from an issuance of common stock and warrants to purchase common stock in a public offering. In August 2016, the Company raised net proceeds of approximately $1.4 million in a private offering of its common stock and $1.5 million through the sale of convertible promissory notes. Basis of Presentation and Principles of Consolidation These unaudited interim condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting and include the accounts of the Company and its subsidiary. Certain information and note disclosures normally included in the consolidated financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. Accordingly, these unaudited interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the year ended January 31, 2016, filed on May 2, 2016. The condensed consolidated balance sheet as of January 31, 2016, included herein, was derived from the audited consolidated financial statements as of that date. The unaudited interim condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary and have been prepared on the same basis as the audited consolidated financial statements and include all adjustments, consisting only of normal recurring adjustments, necessary for the fair presentation of the Company’s statement of financial position as of July 31, 2016 and January 31, 2016, and the Company’s results of operations and its cash flows for the three and six months ended July 31, 2016 and 2015. The results for the three and six months ended July 31, 2016 are not necessarily indicative of the results to be expected for the year ending January 31, 2017 or any future period. Use of Estimates The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses recognized during the reported period. Actual results could differ from those estimates. Inventories Inventories are stated at the lower of cost or market. Cost is determined using the standard cost method which approximates actual cost on a first-in, first-out basis. Market value is determined as the lower of replacement cost or net realizable value. The Company regularly reviews inventory quantities in consideration of actual loss experiences, projected future demand and remaining shelf life to record a provision for excess and obsolete inventory when appropriate. Impairment of Long-Lived Assets The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset might not be recoverable. When such an event occurs, management determines whether there has been an impairment by comparing the anticipated undiscounted future net cash flows to the related asset’s carrying value. If an asset is considered impaired, the asset is written down to fair value, which is determined based either on discounted cash flows or appraised value, depending on the nature of the asset. The Company has not identified any such impairment losses to date. Advertising Expenses The Company expenses the costs of advertising, including promotional expenses, as incurred. Advertising expenses were approximately $59,000 and $313,000 for the three months ended July 31, 2016 and 2015, respectively. Advertising expenses were approximately $278,000 and $549,000 for the six months ended July 31, 2016 and 2015, respectively. Net Loss per Share Basic net loss per share attributable to common stockholders is calculated based on the weighted-average number of shares of the Company’s common stock outstanding during the period. The weighted average shares outstanding for the three and six months ended July 31, 2016 excludes 193,333 of unvested common stock. Diluted net loss per share attributable to common stockholders is calculated based on the weighted-average number of shares of the Company’s common stock outstanding and other dilutive securities outstanding during the period. The potential dilutive shares of common stock resulting from the assumed exercise of outstanding stock options, warrants and the assumed conversion of preferred stock are determined under the treasury stock method. For the three months ended July 31, 2016 and 2015, approximately 10,002,000 and 4,837,000 potentially dilutive securities, respectively, were excluded from the computation of diluted loss per share because their effect on net loss per share would be anti-dilutive. Summary of Significant Accounting Policies These unaudited interim condensed consolidated financial statements and accompanying notes should be read in conjunction with the Company’s annual financial statements and notes thereto contained in the Annual Report on Form 10-K for the fiscal year ended January 31, 2016. There have been no significant changes in the Company’s significant accounting policies for the three months ended July 31, 2016, as compared to the significant accounting policies described in the Annual Report on Form 10-K for the fiscal year ended January 31, 2016. Recent Accounting Pronouncements In February 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2016-02, Leases, which requires entities to recognize assets and liabilities for leases with lease terms greater than twelve months. The new guidance also requires quantitative and qualitative disclosures regarding the amount, timing and uncertainty of cash flows arising from leases. The standard is effective for annual and interim periods beginning after December 15, 2018, with early adoption permitted upon issuance. The Company is in the process of evaluating the impact of adoption on its consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-09, Compensation — Stock Compensation: Improvements to Employee Share-Based Payment Accounting, which relates to the accounting for employee share-based payments. This standard provides guidance on simplifying several aspects of the accounting for employee share-based payment transactions, including the income tax consequences, accounting for forfeitures and classification of excess tax benefits on the statement of cash flows. This standard will be effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. The Company is in the process of evaluating the impact of adoption on its consolidated financial statements. In April 2016, the FASB issued ASU No. 2016-10, Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing, which addresses certain implementation issues that have surfaced since the issuance of ASU No. 2014-09 in May 2014. ASU No. 2016-10 provides guidance in identifying performance obligations and determining the appropriate accounting for licensing arrangements. This standard will be effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company is in the process of evaluating the impact of adoption on its consolidated financial statements. In May 2016, the FASB issued ASU No. 2016-12, Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients. ASU No. 2016-12 will affect all entities that enter into contracts with customers to transfer goods or services that are an output of the entity’s ordinary activities in exchange for consideration. The amendments in this update affect the guidance in ASU No. 2014-09 which is not yet effective. The amendments in this update also affect narrow aspects of Topic 606 including among others: assessing collectability criterion, noncash consideration, and presentation of sales taxes and other similar taxes collected from customers. The effective date of this update is the same as ASU No. 2014-09. The Company is in the process of evaluating the impact of adoption on its consolidated financial statements. | 1. DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Description of Business BioPharmX Corporation (the "Company") is incorporated under the laws of the state of Delaware and originally incorporated on August 30, 2010 in Nevada under the name Thompson Designs, Inc. The Company has one wholly-owned subsidiary, BioPharmX, Inc., a Nevada corporation. The Company is a specialty pharmaceutical company focused on utilizing its proprietary drug delivery technologies to develop and commercialize novel prescription and over-the-counter, or OTC, products that address large markets in women's health and dermatology. The Company's objective is to develop products that treat health or age-related conditions that (1) are not presently being addressed or treated or (2) are currently treated with drug therapies or drug delivery approaches that are suboptimal. The Company's strategy is designed to bring new products to market by identifying optimal delivery mechanisms and/or alternative applications for FDA-approved active pharmaceutical ingredients, or APIs, while in appropriate circumstances, reducing the time, cost and risk typically associated with new product development by repurposing drugs with demonstrated safety profiles, taking advantage of the regulatory approval pathway under Section 505(b)(2) of the Federal Food, Drug and Cosmetic Act available for repurposed/reformulated drugs. The Company believes the 505(b)(2) regulatory pathway may reduce drug development risk and could reduce the time and resources it spends during development. Since the Company's inception, substantially all of the Company's efforts have been devoted to developing its product candidates, including conducting preclinical and clinical trials, and providing general and administrative support for its operations. The Company commercially launched its breast health supplement at the end of 2014, although to-date the Company has not generated significant revenue from product sales. The Company is not dependent on sales to any one customer. The Company has financed its operations primarily through the sale of equity and convertible debt securities. In June 2015, the Company raised $7.8 million through the sale of its common stock in a public offering and concurrently completed an uplisting to the NYSE MKT. In December 2015 we raised net proceeds of $5.5 million in a private offering of our common stock and, in April 2016, we raised net proceeds of approximately $3.6 million from an issuance of common stock and warrants to purchase common stock in a public offering. Share Exchange On January 23, 2014, the Company (then operating as Thompson Designs, Inc.), BioPharmX, Inc. and stockholders of BioPharmX, Inc., who collectively owned 100% of BioPharmX, Inc., entered into and consummated transactions pursuant to a share exchange agreement, such transaction referred to as the Share Exchange, whereby the Company issued to the stockholders of BioPharmX, Inc. an aggregate of 7,025,000 shares of its common stock, in exchange for 100% of the shares of BioPharmX, Inc. held by stockholders. The shares of the Company's common stock received by the stockholders of BioPharmX, Inc. in the Share Exchange constituted approximately 77.8% of its then issued and outstanding common stock, after giving effect to the issuance of shares pursuant to the share exchange agreement. As a result of the Share Exchange, BioPharmX, Inc. became the Company's wholly-owned subsidiary. For accounting purposes, the Share Exchange was treated as a reverse acquisition with BioPharmX, Inc. as the acquirer and the Company as the acquired party, and as a result the historical financial statements prior to the Share Exchange included in this Annual Report on Form 10-K are the historical financial statements of BioPharmX, Inc. On March 3, 2014, the Company changed its name to BioPharmX Corporation. On May 16, 2014, the Company reincorporated from Nevada to Delaware. Change in Fiscal Year End On March 26, 2015, the board of directors of the Company approved a change in its fiscal year end from December 31 to January 31. Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America ("GAAP"). The accompanying financial statements include the accounts of BioPharmX and its wholly-owned subsidiary. All intercompany transactions have been eliminated in consolidation. Use of Estimates The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses recognized during the reported period. Actual results could differ from those estimates. Reclassification Certain prior year amounts have been reclassified to conform to the current year presentation. Deferred rent, accrued payroll and deferred revenue have been included in accrued liabilities and other current liabilities. The amounts for the prior periods have been reclassified to be consistent with the current year presentation and have no impact on previously reported total assets, total stockholders' deficit or net loss. Fair Value Measurements The Company recognizes and discloses the fair value of its assets and liabilities using a hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to valuations based upon unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to valuations based upon unobservable inputs that are significant to the valuation (Level 3 measurements). Each level of input has different levels of subjectivity and difficulty involved in determining fair value. • Level 1—Inputs used to measure fair value are unadjusted quoted prices that are available in active markets for the identical assets or liabilities as of the reporting date. • Level 2—Observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities 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 asset or liability. • Level 3—Unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities. As of January 31, 2016, the Company held $3.6 million in money market funds, which are classified as Level 1 within the fair value hierarchy. No unrealized gains or losses are recorded in connection with these amounts. Accounts Receivable Accounts receivable is recorded net of cash discounts for prompt payment and return allowances. There was no allowance for doubtful accounts receivable recorded at either January 31, 2016 or 2015. Inventories Inventories are stated at the lower of cost or market. Cost is determined using the standard cost method which approximates actual cost on a first-in, first-out basis. Market value is determined as the lower of replacement cost or net realizable value. The Company regularly reviews inventory quantities in consideration of actual loss experiences, projected future demand and remaining shelf life to record a provision for excess and obsolete inventory when appropriate. Fair Value of Financial Instruments Carrying amounts of certain of the Company's financial instruments, including cash and cash equivalents, prepaid and other current assets, accounts payable, accrued expenses and other liabilities and related party payables approximate fair value due to their short maturities. Property and Equipment Property, plant and equipment is stated at cost less accumulated depreciation and amortization. Depreciation and amortization are recognized using the straight-line method. Repairs and maintenance costs are expensed as incurred. Estimated useful lives in years are as follows: Description Estimated Useful Life Furniture 5 - 7 Laboratory equipment 3 - 5 Computer and equipment 3 - 5 Software 5 Intangible Assets Intangible assets with finite useful lives are amortized over their estimated useful lives. Intangible assets with finite useful lives are reviewed for impairment when facts or circumstances suggest that the carrying value of these assets may not be recoverable. The intangible assets were acquired in March 2013 in connection with the collaboration and license agreement with Iogen detailed in Note 5. Amortization of the intangible assets commenced in January 2015 with the first recognition of revenue related to VI 2 OLET and is being taken on a straight-line basis over 5 years. Impairment of Long-Lived Assets The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset might not be recoverable. When such an event occurs, management determines whether there has been an impairment by comparing the anticipated undiscounted future net cash flows to the related asset's carrying value. If an asset is considered impaired, the asset is written down to fair value, which is determined based either on discounted cash flows or appraised value, depending on the nature of the asset. The Company has not identified any such impairment losses to date. Restricted Cash The Company has restricted cash in the amount of $35,000 held in a money market account to secure the credit line of the Company's credit cards. Revenue Recognition VI 2 OLET is a new product in the dietary supplement field. Revenue is recognized provided that persuasive evidence of a sales arrangement exists, the price is fixed or determinable, title and risk of loss has transferred, calculability of the resulting receivable is reasonably assured, there are no customer acceptance requirements and we do not have any significant post-shipment obligations. The Company recognizes revenue on a sell-through basis for customer arrangements in which it does not have historical information to estimate product returns, pricing discounts or other concessions upon shipment. For these product shipments, the Company invoices the reseller, records deferred revenue at the gross invoice sales price and classifies the cost basis of the product held by the wholesaler as a component of inventory. Deferred revenue is adjusted for price protection and other revenue reserves. Revenue is recognized when product is sold by the reseller to the end user, on a first-in first-out (FIFO) basis. For customer arrangements in which returns, price discounts and other concessions can be reasonably estimated, revenue is recognized upon shipment and a reserve is recorded for returns, price discounts and other concessions. Cost of Good Sold Costs of good sold includes direct costs related to the sale of the Company's iodine dietary supplement, write-downs of excess and obsolete inventories, and amortization of intangible assets. Shipping and Handling Costs Shipping and handling costs are expensed as incurred and are included in cost of goods sold. Research and Development Expenses Research and development expenses are expensed as incurred and consist primarily of personnel costs, including salaries, benefits and stock-based compensation, clinical studies performed by contract research organizations ("CROs"), consulting, materials, supplies, and facilities and other overhead allocations. Advertising Expenses The Company expenses the costs of advertising, including promotional expenses, as incurred. Advertising expenses were $1.2 million for year ended January 31, 2016, $90,000 for the one month ended January 31, 2015 and $68,000 for the year ended December 31, 2014. Income Taxes The Company accounts for income taxes using the liability method whereby deferred tax asset and liability account balances are determined based on differences between financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. Valuation allowances are established to reduce deferred tax assets when management estimates, based on available objective evidence, that it is more likely than not that the benefit will not be realized for the deferred tax assets. The Company's policy is to recognize interest and penalties accrued on any unrecognized tax benefits as a component of income tax expense. No interest expense was recognized during the periods presented. Stock-Based Compensation The Company recognizes stock-based compensation for equity awards on a straight-line basis over their vesting periods based on the grant date fair value. The Company estimates the fair value of stock options granted using the Black-Scholes pricing model. This model also requires subjective assumptions, including future stock price volatility and expected time to exercise, which greatly affect the calculated values. Equity instruments issued to non-employees are recorded at their fair value on the measurement date and are subject to periodic adjustment as the underlying equity instruments vest. Comprehensive Loss Comprehensive loss is the change in equity of an enterprise, except those resulting from stockholder transactions. Accordingly, comprehensive loss includes certain changes in equity that are excluded from net loss. For the year ended January 31, 2016, one month ended January 31, 2015 and year ended December 31, 2014, the Company's comprehensive loss is equal to net loss. There were no components of other comprehensive loss for any of the periods presented. Net Loss Per Share Basic net loss per share attributable to common stockholders is calculated based on the weighted-average number of shares of the Company's common stock outstanding during the period. Diluted net loss per share attributable to common stockholders is calculated based on the weighted-average number of shares of the Company's common stock outstanding and other dilutive securities outstanding during the period. The potential dilutive shares of common stock resulting from the assumed exercise of outstanding stock options, warrants and the assumed conversion of preferred stock are determined under the treasury stock method. As of January 31, 2016, January 31, 2015 and December 31, 2014, 5,741,000, 9,793,000 and 9,713,000 potentially dilutive securities, respectively, were excluded from the computation of diluted loss per share because their effect on net loss per share would be anti-dilutive. Recent Accounting Pronouncements In July 2015, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2015-11, Inventory (Topic 330), Simplifying the Measurement of Inventory, which applies to all inventory except that which is measured using last-in, first-out (LIFO) or the retail inventory method. Inventory measured using first-in, first-out (FIFO) or average cost is included in the new amendment. The amendment will take effect for public business entities for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. The Company is in the process of evaluating the impact of adoption on the its consolidated financial statements. In August 2015, FASB issued Accounting Standards Update No. 2015-14, Revenue from Contracts with Customers (ASU No. 2014-09). This update defers the effective dates of ASU No. 2014-09 (originally issued in June 2014) for public business entities by one year, or until annual reporting periods beginning after December 15, 2017, including interim reporting periods within the reporting period. ASU No. 2014-09 gives entities a single comprehensive model to use in reporting information about the amount and timing of revenue resulting from contracts to provide goods or services to customers. The proposed ASU, which would apply to any entity that enters into contracts to provide goods or services, would supersede the revenue recognition requirements in Topic 605, Revenue Recognition, and most industry-specific guidance throughout the Industry Topics of the Codification. Additionally, the update would supersede some cost guidance included in Subtopic 605-35, Revenue Recognition—Construction-Type and Production-Type Contracts. The update removes inconsistencies and weaknesses in revenue requirements and provides a more robust framework for addressing revenue issues and more useful information to users of financial statements through improved disclosure requirements. In addition, the update improves comparability of revenue recognition practices across entities, industries, jurisdictions, and capital markets and simplifies the preparation of financial statements by reducing the number of requirements to which an entity must refer. The Company is continuing to review the provisions of this ASU to determine if there will be any impact on its results of operations, cash flows or financial condition. In February 2016, FASB issued ASU No. 2016-02, Leases, which requires entities to recognize assets and liabilities for leases with lease terms greater than twelve months. The new guidance also requires quantitative and qualitative disclosures regarding the amount, timing and uncertainty of cash flows arising from leases. The standard is effective for annual and interim periods beginning after December 15, 2018, with early adoption permitted upon issuance. The Company is in process of evaluating the impact of adoption on its consolidated financial statements. In August 2014, FASB issued ASU No. 2014-15, Presentation of Financial Statements—Going Concern (Subtopic 205-40). This ASU provides guidance to determine when and how to disclose going-concern uncertainties in the financial statements. The new standard requires management to perform interim and annual assessments of an entity's ability to continue as a going concern within one year of the date that the financial statements are issued. An entity must provide certain disclosures if conditions or events raise substantial doubt about the entity's ability to continue as a going concern. This standard is effective for annual periods ending after December 15, 2016. The Company is evaluating the impact of the adoption of this ASU on its consolidated financial statements. The Company has reviewed other recent accounting pronouncements and concluded they are either not applicable to the business, or no material effect is expected on the consolidated financial statements as a result of future adoption. |
GOING CONCERN53
GOING CONCERN | 6 Months Ended | 12 Months Ended |
Jul. 31, 2016 | Jan. 31, 2016 | |
GOING CONCERN | ||
GOING CONCERN | 2. GOING CONCERN The accompanying condensed consolidated financial statements have been prepared assuming the Company will continue as a going concern, meaning the Company will continue in operation for the foreseeable future and will be able to realize assets and discharge liabilities in the ordinary course of operations. As of July 31, 2016, the Company had cash and cash equivalents of $0.4 million and working capital deficit of $3.5 million. In August 2016, the Company raised net proceeds of approximately $2.9 million in a private offering of its common stock and sale of convertible promissory notes. The Company has incurred recurring losses and negative cash flows from operations since inception and has funded its operating losses through the sale of common stock in public and private offerings and the issuance of convertible notes, Series A convertible redeemable preferred stock and warrants. The Company incurred a net loss available to common stockholders of $5.0 million and $3.7 million during the three months ended July 31, 2016 and 2015, respectively, and $9.5 million and $7.6 million during the six months ended July 31, 2016 and 2015, respectively, and had an accumulated deficit of $35.7 million as of July 31, 2016. The Company has a limited operating history and its prospects are subject to risks, expenses and uncertainties frequently encountered by companies in its industry. To date, the Company has generated a de minimis amount of revenue from the sale of VI 2 OLET, its iodine dietary supplement. The Company continues its research and development efforts for its product candidates, which will require significant funding. If the Company is unable to obtain additional financing in the near-term, or if revenues fall short of expectations or research and development efforts require higher than anticipated capital, there may be a negative impact on the financial viability of the Company. The Company plans to increase working capital by managing its cash flows and expenses and raising additional capital through either private or public equity or debt financing. The Company also continues to pursue additional channel distribution expansion for VI 2 OLET through partnerships with women’s health companies to provide broader access to consumers. There can be no assurance that such financing will be available or on terms which are favorable to the Company. While management of the Company believes that it has a plan to fund ongoing operations, there is no assurance that its plan will be successfully implemented. Failure to generate sufficient cash flows from operations, raise additional capital through one or more financings, or reduce certain discretionary spending could have a material adverse effect on the Company’s ability to achieve its intended business objectives. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The condensed consolidated financial statements do not contain any adjustments that might result from the resolution of any of the above uncertainties. | 2. GOING CONCERN The Company has a limited operating history and its prospects are subject to risks, expenses and uncertainties frequently encountered by companies in the industry. The Company's ability to generate income in the short-run will depend greatly on the rate of adoption and ability to establish a sustainable market for VI 2 OLET. The Company continues its research and development efforts for its products, which will require significant funding. If revenues fall short of expectations or research and development efforts require higher than anticipated capital, then there may be a negative impact on the financial viability of the Company. The Company has incurred recurring losses and negative cash flows from operations since inception and has funded its operating losses through the sale of common stock in public and private offerings and the issuance of convertible notes, Series A convertible redeemable preferred stock and warrants. In June 2015, the Company raised net proceeds of $7.8 million in a public offering of its common stock. In December 2015, the Company raised net proceeds of $5.5 million in a private offering of its common stock and, in April 2016, raised net proceeds of approximately $3.6 million in a public offering of its common stock. The accompanying consolidated financial statements have been prepared assuming the Company will continue as a going concern. The Company plans to increase working capital by managing its cash flows and expenses, securing financing and increasing revenue. The Company continues to pursue additional channel distribution expansion for VI 2 OLET to provide even broader access to consumers. Risks include, but are not limited to, the uncertainty of availability of additional financing and the uncertainty of achieving future profitability. Management of the Company intends to raise additional funds through the issuance of equity securities. The Company has an effective shelf registration statement on file with the SEC to allow it to sell up to approximately $100 million of its securities from time to time prior to February 2019, subject to regulatory limitations. For example, pursuant to General Instruction I.B.6 of Form S-3, in no event will the Company sell securities pursuant to the shelf registration statement with a value of more than one-third of the aggregate market value of its common stock held by non-affiliates in any 12-month period, so long as the aggregate market value of its common stock held by non-affiliates is less than $75.0 million. There can be no assurance that such financing will be available or on terms which are favorable to the Company. Failure to generate sufficient cash flows from operations, raise additional capital or reduce certain discretionary spending could have a material adverse effect on the Company's ability to achieve its intended business objectives. These factors raise substantial doubt about the Company's ability to continue as a going concern. The consolidated financial statements do not contain any adjustments that might result from the resolution of any of the above uncertainties. As shown in the accompanying consolidated financial statements, the Company incurred a net loss available to common stockholders of $16.0 million during the year ended January 31, 2016, and had an accumulated deficit of $26.2 million as of January 31, 2016. As of January 31, 2016, the Company had working capital of approximately $1.6 million. While management of the Company believes that it has a plan to fund ongoing operations, there is no assurance that its plan will be successfully implemented. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 6 Months Ended |
Jul. 31, 2016 | |
FAIR VALUE MEASUREMENTS | |
FAIR VALUE MEASUREMENTS | 3. FAIR VALUE MEASUREMENTS The Company recognizes and discloses the fair value of its assets and liabilities using a hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to valuations based upon unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to valuations based upon unobservable inputs that are significant to the valuation (Level 3 measurements). Each level of input has different levels of subjectivity and difficulty involved in determining fair value. · Level 1—Inputs used to measure fair value are unadjusted quoted prices that are available in active markets for the identical assets or liabilities as of the reporting date. · Level 2— Observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities 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 asset or liability. · Level 3— Unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities. As of July 31, 2016, the Company held $0.2 million in money market funds, which are classified as Level 1 within the fair value hierarchy. No unrealized gains or losses are recorded in connection with these amounts. |
BALANCE SHEET DETAILS55
BALANCE SHEET DETAILS | 6 Months Ended | 12 Months Ended |
Jul. 31, 2016 | Jan. 31, 2016 | |
BALANCE SHEET DETAILS | ||
BALANCE SHEET DETAILS | 4. BALANCE SHEET DETAILS July 31, January 31, (in thousands) Inventories: Work in process $ $ Finished goods Channel inventory Total $ $ | 3. BALANCE SHEET DETAILS January 31, 2016 2015 (in thousands) Inventories: Work in process $ $ Finished goods Channel inventory $ $ January 31, 2016 2015 (in thousands) Property and equipment, net: Furniture $ $ Laboratory equipment Computer and equipment Software Less: accumulated depreciation ) ) $ $ Depreciation expense for the year ended January 31, 2016, one month ended January 31, 2015 and year ended December 31, 2014 was $56,000, $1,000 and $25,000, respectively. Intangible assets, net: Intangible assets were as follows (dollar amounts in thousands): As of January 31, 2016 Estimated Useful Life Gross Value Accumulated Amortization Net Value Intangible assets 5 years $ $ ) $ As of January 31, 2015 Estimated Useful Life Gross Value Accumulated Amortization Net Value Intangible assets 5 years $ $ ) $ Amortization expense for the year ended January 31, 2016 and one month ended January 31, 2015 was $30,000 and $1,000, respectively. No amortization expense was recorded for the year ended December 31, 2014. Amortization is recorded in cost of goods sold. As of January 31, 2016, the estimated aggregate future amortization expense in future years is as follows (in thousands): Years ending January 31: 2017 $ 2018 2019 2020 Total $ January 31, 2016 2015 (in thousands) Accrued liabilities: Payroll $ $ Research and development — Legal — Marketing — Deferred rent Deferred revenue Other $ $ |
RELATED PARTY PAYABLES56
RELATED PARTY PAYABLES | 6 Months Ended | 12 Months Ended |
Jul. 31, 2016 | Jan. 31, 2016 | |
RELATED PARTY PAYABLES | ||
RELATED PARTY PAYABLES | 5. RELATED-PARTY PAYABLES Since the beginning of 2014, a portion of the compensation of the founding executives of the Company has been deferred and is included in the related party payables balance. The deferred compensation is non-interest bearing and has periodically been repaid to these executives. Related party payables as of July 31, 2016 and January 31, 2016 were approximately $104,000 and $225,000, respectively. | 4. RELATED PARTY PAYABLES Since inception, the founding executives of the Company have made advances to cover short-term operating expenses. Additionally, since the beginning of 2014 a portion of their compensation has been deferred and is included in this balance. These advances and deferred compensation are non-interest bearing and have periodically been repaid to these executives. Related party payables as of January 31, 2016 and 2015 were $225,000 and $218,000, respectively. |
COMMITMENTS AND CONTINGENCIES57
COMMITMENTS AND CONTINGENCIES | 6 Months Ended | 12 Months Ended |
Jul. 31, 2016 | Jan. 31, 2016 | |
COMMITMENTS AND CONTINGENCIES | ||
COMMITMENTS AND CONTINGENCIES | 6. COMMITMENTS AND CONTINGENCIES Commitments The following table summarizes the Company’s commitments as of July 31, 2016 (in thousands): Total 2017 2018 2019 2020 2021 Operating lease $ $ $ — $ — $ — $ — Purchase commitment Total $ $ $ $ $ $ On August 23, 2013, the Company signed a lease for 10,800 square feet of office and laboratory space in Menlo Park, California. The lease expires in November 2016. Rent expense for the three months ended July 31, 2016 and 2015 was approximately $86,000 and $94,000, respectively. Rent expense for each of the six months ended July 31, 2016 and 2015 was approximately $172,000. The purchase commitment relates to the manufacturing of VI2OLET and is non-cancelable. Legal Proceedings The Company is not a party to any material legal proceeding that the Company believes is likely to have a material adverse effect on its consolidated financial position or results of operations. From time to time the Company may be subject to legal proceedings and claims in the ordinary course of business. These claims, even if not meritorious, could result in the expenditure of significant financial resources and diversion of management efforts. Indemnification The Company enters into standard indemnification arrangements in the ordinary course of business. Pursuant to these arrangements, the Company indemnifies, holds harmless, and agrees to reimburse the indemnified parties for losses suffered or incurred by the indemnified party, in connection with any trade secret, copyright, patent or other intellectual property infringement claim by any third-party with respect to the Company’s technology. The term of these indemnification agreements is generally perpetual. The maximum potential amount of future payments the Company could be required to make under these agreements is not determinable because it involves claims that may be made against the Company in the future, but have not yet been made. The Company has entered into indemnification agreements with its directors and officers that may require the Company to indemnify its directors and officers against liabilities that may arise by reason of their status or service as directors or officers, other than liabilities arising from willful misconduct of the individual. The Company has not incurred costs to defend lawsuits or settle claims related to these indemnification agreements. No liability associated with such indemnifications has been recorded to date. License Agreement In March 2013, the Company entered into an amended and restated collaboration and license agreement with Iogen LLC, which provides the Company with a license to certain rights to label, market, and resell the finished inventory and ongoing manufacturing of the Iogen molecular iodine technology for future product formulation development and commercialization. New formulation patents developed by the Company will be solely owned by the Company. The agreement gives the Company a perpetual, fully paid-up, exclusive license to make, have made, use, sell and offer for sale and import products. Pursuant to the terms of the license, the Company must pay: · a fee for the exclusive license to the IP. · 30% of net profit associated with direct commercialization of an OTC product or 30% of net royalties received from any sub-licensee. · a royalty of 3% of net sales for the first 24 months of commercialization and 2% of net sales thereafter for a prescription iodine tablet developed and commercialized under the license. · a royalty of 3% of net sales for the first 12 months of commercialization for other products developed and commercialized under the license and 2% of net sales thereafter until expiration of applicable patents covering such products and 1% thereafter. · a fixed royalty fee for the protection and indemnification of licensed intellectual property right (“IP rights”) for the prescription product developed, marketed and sold from newly developed formulations as long as the patents are valid and cover the prescription product. · a fixed royalty fee for the protection and indemnification of licensed IP rights for the other products utilizing the molecular iodine technology developed, marketed and sold from newly developed formulations as long as the patents are valid and cover the prescription product. The Company capitalized as intangible assets, in the year ended December 31, 2013, the amount of $150,000 related to this agreement. As of July 31, 2016 and January 31, 2016, the balance, net of amortization, was approximately $104,000 and $119,000, respectively. No royalties have been paid as of July 31, 2016. | 5. COMMITMENTS AND CONTINGENCIES Commitments The following table summarizes the Company's commitments as of January 31, 2016 (in thousands): Total 2017 2018 2019 2020 2021 Operating lease $ $ $ — $ — $ — $ — Purchase commitment Total $ $ $ $ $ $ On August 23, 2013, the Company signed a lease for 10,800 square feet of office and laboratory space in Menlo Park, California. The lease expires in November 2016. Rent expense for the year ended January 31, 2016, one month ended January 31, 2015 and year ended December 31, 2014 was $357,000, $26,000 and $310,000, respectively. The purchase commitment relates to the manufacturing of VI 2 OLET and is non-cancelable. Legal Proceedings The Company is not currently a party to any legal proceedings. The Company is not aware of any pending legal proceeding to which any of its officers, directors, or any beneficial holders of 5% or more of its voting securities are adverse to the Company or have a material interest adverse to the Company. Indemnification The Company enters into standard indemnification arrangements in the ordinary course of business. Pursuant to these arrangements, the Company indemnifies, holds harmless, and agrees to reimburse the indemnified parties for losses suffered or incurred by the indemnified party, in connection with any trade secret, copyright, patent or other intellectual property infringement claim by any third-party with respect to the Company's technology. The term of these indemnification agreements is generally perpetual. The maximum potential amount of future payments the Company could be required to make under these agreements is not determinable because it involves claims that may be made against the Company in the future, but have not yet been made. The Company has entered into indemnification agreements with its directors and officers that may require the Company to indemnify its directors and officers against liabilities that may arise by reason of their status or service as directors or officers, other than liabilities arising from willful misconduct of the individual. The Company has not incurred costs to defend lawsuits or settle claims related to these indemnification agreements. No liability associated with such indemnifications has been recorded to date. License Agreement In March 2013, the Company entered into an amended and restated collaboration and license agreement with Iogen, which provides the Company with a license to certain rights to label, market, and resell the finished inventory and ongoing manufacturing of the Iogen molecular iodine technology for future product formulation development and commercialization. New formulation patents developed by the Company will be solely owned by the Company. The agreement gives the Company a perpetual, fully paid-up, non-exclusive license to make, have made, use, sell and offer for sale and import products. Pursuant to the terms of the license, the Company must: • Pay a fee for the non-exclusive license to the IP. • Pay 30% of net profit associated with direct commercialization of an OTC product or 30% of net royalties received from any sub-licensee. • Pay a royalty of 3% of net sales for the first 24 months of commercialization and 2% of net sales thereafter for a prescription iodine tablet developed and commercialized under the license. • Pay a royalty of 3% of net sales for the first 12 months of commercialization for other products developed and commercialized under the license and 2% of net sales thereafter until expiration of applicable patents covering such products and 1% thereafter. • Pay a fixed royalty fee for the protection and indemnification of licensed intellectual property rights ("IP rights") for the prescription product developed, marketed and sold from newly developed formulations as long as the patents are valid and cover the prescription product. • Pay a fixed royalty fee for the protection and indemnification of licensed IP rights for the other products utilizing the molecular iodine technology developed, marketed and sold from newly developed formulations as long as the patents are valid and cover the prescription product. The Company capitalized as intangible assets, the amount of $150,000 related to this agreement. As of January 31, 2016 and 2015, the balance, net of amortization, was $119,000 and $149,000, respectively. No royalties have been paid as of January 31, 2016. |
CONVERTIBLE REDEEMABLE PREFER58
CONVERTIBLE REDEEMABLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY | 6 Months Ended | 12 Months Ended |
Jul. 31, 2016 | Jan. 31, 2016 | |
CONVERTIBLE REDEEMABLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY | ||
CONVERTIBLE REDEEMABLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY | 7. CONVERTIBLE REDEEMABLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY Common Stock In June 2015, the Company uplisted to the NYSE MKT and simultaneously completed a public offering in which it issued 3,636,384 shares of common stock resulting in net proceeds of $7.8 million. Pursuant to the terms of a convertible note previously issued, immediately prior to the closing of the offering, the principal amount and all accrued and unpaid interest converted into 182,266 shares of common stock. Pursuant to a subscription agreement dated October 24, 2014, Korea Investment Partners Overseas Expansion Platform Fund (“KIP”), an existing stockholder, agreed to purchase 1,081,081 shares of common stock from the Company at a price of $1.85 per share in a private placement (the “KIP private placement”) upon the earlier to occur of (i) the Company receiving revenues from Violet of $2,000,000 or (ii) receipt by the Company of approval to list on any tier of the NYSE or Nasdaq stock market at a market price of at least $3.70 per share. In addition, KIP has previously informed the Company of its intention to complete the KIP private placement even if the Company’s stock price was not at least $3.70 per share. As of the date of this report, this private placement has not closed, and the Company does not expect the private placement to close. As consideration for Ping Wang’s service as a director of the Company (Wang is no longer a director of the Company), 290,000 shares of the Company’s common stock were issued, of which 96,667 shares vested immediately and 193,333 shares will vest immediately upon completion of the $2.0 million purchase. In December 2015, the Company sold 4,100,000 shares of common stock at a price per share of $1.43 resulting in net proceeds of $5.5 million in a private placement to investment funds managed by Franklin Advisers. For a period of five years, Franklin Advisers has the right to purchase up to an aggregate of 20% of the securities offered by the Company in any subsequent private placement. In April 2016, the Company issued 3,600,000 shares of common stock at a price per share of $1.195 resulting in net proceeds of approximately $3.6 million and warrants to purchase 1,952,000 shares of common stock in a public offering. These warrants have an exercise price of $1.20 per share and expire on April 1, 2021. As of July 31, 2016, all of these warrants were outstanding. Series A Preferred Stock During 2014, the Company entered into subscription agreements for the private placement of 4,207,987 shares of its Series A preferred stock and warrants to purchase 2,042,589 shares of common stock at an exercise price of $3.70 per share. In connection with the uplisting to the NYSE MKT, the Series A preferred stock, including accrued and unpaid interest, converted into 4,319,426 shares of common stock. The warrant exercise agreements included a provision such that if the public offering price related to the offering was less than $3.125 per share, then immediately prior to the closing of the offering, additional shares of common stock would be issued at no additional consideration to each holder equal to: (i) the product of (A) the difference between $2.50 per share and 80% of the public offering price and (B) such holder’s shares of common stock received pursuant to exercise of the amended warrants, divided by (ii) 80% of the public offering price in the offering. Based on a public offering price of $2.75 per share, 77,006 shares of common stock were issued pursuant to this provision. In March and April 2015, the Company amended certain of the warrants issued in connection with the Series A preferred stock financing to reduce the exercise price of such warrants from $3.70 to $2.50 per share with a corresponding increase in the number of shares of common stock exercisable under the warrants so that the aggregate exercise value of such warrants remained the same. As of January 31, 2016, certain holders had exercised such warrants for an aggregate of 564,662 shares of common stock for an aggregate cash exercise price of $1,411,655. The Company recorded a charge for the incremental fair value of $436,000 in other expense related to the amended warrants in the first quarter of fiscal year 2016. The fair value of the warrants exercised was computed as of the date of modification using the following assumptions: dividend rate of 0%, risk-free rate of 1.6%, contractual term of four to five years and expected volatility of 85.9%. As of July 31, 2016, of the warrants issued in connection with the Series A preferred stock financing, warrants to purchase 1,661,055 shares of common stock remain outstanding. Pursuant to the Certificate of Elimination filed with the Secretary of State of the State of Delaware on March 17, 2016, all shares of Series A preferred stock previously designated were returned to the status of authorized but unissued shares of preferred stock, without designation as to series or rights, preferences, privileges or limitations. Warrants In addition to the warrants issued in conjunction with the Series A preferred stock subscription agreements, the Company issued warrants on May 15, 2014, to a service provider for 316,395 shares of common stock at an exercise price of $2.035 per share, which were valued at $99,000 and expensed. As of July 31, 2016, all were outstanding. On May 14, 2014, the Company also issued warrants valued at $105,000 for 343,559 shares of common stock at an exercise price of $1.85 per share to a qualified investor as a part of his convertible loan package. These warrants expire five years after the date of issuance. These warrants are immediately exercisable, and in June 2015, a portion of the warrants were exercised for 54,054 shares of common stock. As of July 31, 2016, warrants exercisable for 289,505 shares of common stock remain outstanding. In connection with the offering completed in June 2015, warrants to purchase 109,091 shares of common stock were issued to the underwriters at the public offering price of $2.75. These warrants expire five years after the date of issuance. As of July 31, 2016, all of these warrants were outstanding. In connection with the sale of common stock in April 2016, warrants to purchase 1,952,000 shares of common stock were issued at an exercise price of $1.20. As of July 31, 2016, all of these warrants were outstanding. Equity Incentive Plan On July 5, 2016, the Company adopted the 2016 Equity Incentive Plan, or 2016 Plan, which permits the Company to grant equity awards to directors, officers, employees and consultants. In connection with the adoption of the 2016 Plan, the Company ceased to grant equity awards under its 2014 Equity Incentive Plan, or 2014 Plan, which was adopted on January 23, 2014. All grants and awards under the 2014 Plan, including stock options previously issued under BioPharmX, Inc.’s 2011 Equity Incentive Plan which were substituted with stock options issued under the 2014 Plan, remain in effect in accordance with their terms. Stock options generally vest in two to four years and expire ten years from the date of grant. Under the 2016 Plan, 4,000,000 shares were reserved for issuance. The 2014 Plan and 2016 Plan are referred to collectively as the “Plans.” The following table summarizes the Company’s stock option activities under the Plans: Available Shares Weighted Remaining Aggregate (in thousands) Outstanding as of January 1, 2016 $ $ Exercised — ) $ Cancelled ) $ Outstanding as of April 30 2016 $ $ Shares authorized for issuance — Granted ) $ Exercised — ) $ Cancelled ) $ Expired upon termination of the 2014 Plan ) — $ — Outstanding as of July 31, 2016 $ $ Vested and exercisable $ $ Vested and expected to vest $ $ Inducement Grants The Company has also awarded inducement option grants to purchase common stock to new employees outside of the 2014 Plan as permitted under Section 711(a) of the NYSE MKT Company Guide. Such options vest at the rate of 25% of the shares on the first anniversary of the commencement of such employee’s employment with the Company, and then one forty-eighth (1/48) of the shares monthly thereafter subject to such employee’s continued service. The following table summarizes the Company’s inducement grant stock option activities: Shares Weighted Remaining Aggregate (in thousands) Balance at January 31, 2016, April 30, 2016 and July 31, 2016 $ $ — Vested and exercisable — $ — — $ — Vested and expected to vest $ $ — The following table summarizes significant ranges of outstanding and exercisable options as of July 31, 2016: Options Outstanding Options Vested and Exercisable Range of Exercise Price Number Weighted Weighted Number Weighted $0.25 - $0.62 $ $ $0.63 - $1.00 $ $ $1.01 - $1.67 $ $ $1.68 - $3.00 $ $ $3.01 - $3.25 $ $ $ $ The total intrinsic value of stock options exercised during the three and six months ended July 31, 2016 was approximately $5,000 and $39,000, respectively. The total intrinsic value of stock options exercised during the three and six months ended July 31, 2015 was $1.2 million and $1.3 million, respectively. | 6. CONVERTIBLE REDEEMABLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY Common Stock As described in Note 1, on January 23, 2014, the Company issued 7,025,000 shares of its common stock to BioPharmX, Inc. stockholders. The Company issued convertible notes payable ("Notes") from September 2012 through March 2014. Under the terms of the Notes, on April 11, 2014, the Notes automatically converted into 1,526,001 shares of common stock upon the Company's sale of Series A Preferred Stock. In June 2015, the Company uplisted to the NYSE MKT and simultaneously completed a public offering (the "Offering") in which it issued 3,636,384 shares of common stock resulting in net proceeds of $7.8 million. Pursuant to the subscription agreement dated October 24,2014, KIP, an existing stockholder, shall purchase shares in the KIP private placement upon the earlier to occur of (i) the Company receiving revenues from Violet of $2,000,000 or (ii ) receipt by the Company of approval to list on any tier of the NYSE or Nasdaq stock market at a market price of at least $3.70 per share. In addition, KIP has previously informed the Company of its intention to complete the KIP private placement even if the Company’s stock price was not at least $3.70 per share. As of May 2, 2016, this private placement has not closed, and the Company is unable to predict if or when the private placement will close. As consideration for Ping Wang's service as a director of the Company, 290,000 shares of the Company's common stock were issued, of which 96,667 vested immediately and 193,333 shares of the common stock will vest immediately upon completion of the $2.0 million purchase. In June 2015, the Company issued a 6% unsecured convertible note in the principal amount of $500,000 to an investor. Under the terms of the convertible note, immediately prior to the closing of the Offering, the principal amount and all accrued and unpaid interest, converted into 182,266 shares of common stock. In December 2015, the Company sold 4,100,000 shares of common stock at a price per share of $1.43 resulting in net proceeds of $5.5 million in a private placement to investment vehicles of Franklin Advisers. For a period of 5 years, Franklin Advisers have the right to purchase up to an aggregate of 20% of the securities offered by the Company in any subsequent private placement. Series A Preferred Stock The Company entered into subscription agreements for the private placement of shares of its Series A preferred stock and warrants with 47 accredited investors during 2014 whereby the Company sold an aggregate of 4,207,987 shares of Series A preferred stock at a per share price of $1.85 for gross proceeds of $7.5 million and issued to the investors for no additional consideration warrants to purchase in the aggregate 2,042,589 shares of common stock, with an exercise price of $3.70 per share. The allocated fair value of the warrants related to these subscription agreements was determined to be $845,000 and was recorded as additional paid-in capital. The fair value was computed using the Black-Scholes pricing model with the following assumptions: dividend rate of 0%, risk-free rate of 1.6% to 4.0%, contractual term of 5 years and expected volatility of 88.8%. In connection with the uplisting to the NYSE MKT, the Series A preferred stock, including accrued and unpaid interest, converted into 4,319,426 shares of common stock. In March and April 2015, the Company amended certain of the warrants issued in connection with the Series A preferred financing to reduce the exercise price of such warrants from $3.70 to $2.50 per share with a corresponding increase in the number of shares of common stock exercisable under the warrants so that the aggregate exercise value of such warrants remained the same. As of January 31, 2016, certain holders had exercised such warrants for an aggregate of 564,662 shares of common stock for an aggregate cash exercise price of $1,411,655. The Company recorded a charge for the incremental fair value of $436,000 in other expense related to the amended warrants in the first quarter of fiscal year 2016. The fair value of the warrants exercised was computed as of the date of modification using the following assumptions: dividend rate of 0%, risk-free rate of 1.6%, contractual term of 4 to 5 years and expected volatility of 85.9%. As of January 31, 2016, of the warrants issued in connection with the Series A preferred stock financing, warrants to purchase 1,661,055 shares of common stock remain outstanding. The warrant exercise agreements included a provision such that if the public offering price related to the Offering was less than $3.125 per share, then immediately prior to the closing of the Offering, additional shares of common stock would be issued at no additional consideration to each holder equal to: (i) the product of (A) the difference between $2.50 per share and 80% of the public offering price and (B) such holder's shares of common stock received pursuant to exercise of the amended warrants, divided by (ii) 80% of the public offering price in the Offering. Based on a public offering price of $2.75 per share, 77,006 shares of common stock were issued pursuant to this provision. Warrants In addition to the warrants issued in conjunction with the subscription agreements, the Company issued warrants on May 15, 2014, to a service provider for 316,395 shares of common stock at an exercise price of $2.035 per share, which were valued at $99,000 and expensed. As of January 31, 2016, all were outstanding. On May 14, 2014, the Company also issued warrants valued at $105,000 for 343,559 shares of common stock at an exercise price of $1.85 per share to a qualified investor as a part of his convertible loan package. These warrants expire five years after the date of issuance. These warrants are immediately exercisable, and in June 2015, a portion of the warrants were exercised for 54,054 shares of common stock. As of January 31, 2016, warrants exercisable for 289,505 shares of common stock remain outstanding. In connection with the Offering, 109,091 warrants were issued to the underwriters at the public offering price of $2.75. These warrants expire five years after the date of issuance. As of January 31, 2016, all were outstanding. Equity Incentive Plan On January 23, 2014, the Company adopted the 2014 Equity Incentive Plan, or the 2014 Plan, which permits the Company to grant stock options to directors, officers or employees of the Company or others to purchase shares of common stock of the Company through awards of incentive and nonqualified stock options, restricted stock awards and stock appreciation rights. Stock options previously issued under BioPharmX, Inc.'s 2011 Equity Incentive Plan were substituted with stock options issued under the 2014 Plan. Stock options generally vest in two to four years and expire ten years from the date of grant. The total number of shares originally reserved and available for grant and issuance pursuant to the 2014 Plan was 2,700,000. Shares issued under the 2014 Plan are drawn from authorized and unissued shares or shares now held or subsequently acquired by the Company. On November 7, 2014, the Company increased the stock reserve available to the 2014 Plan for stock awards from 2,700,000 shares to 4,500,000 shares. The following table summarizes the Company's stock option activities under the 2014 Plan: Available for Grant Shares Weighted Average Exercise Prices Remaining Contractual Life Aggregate Intrinsic Value (in thousands) Balance at January 1, 2013 $ Granted ) Balance at December 31, 2013 $ Additional shares authorized — — Granted ) Exercised — ) Cancelled ) Balance at December 31, 2014 $ $ Granted ) Exercised — ) Cancelled ) Balance at January 31, 2015 $ $ Granted ) Exercised — ) Cancelled ) Balance at January 31, 2016 $ $ Vested and exercisable $ $ Vested and expected to vest $ $ Inducement Grants The Company has also awarded inducement options to purchase common stock to new employees outside of the 2014 Plan as material inducements to the acceptance of employment with the Company as permitted under Section 711(a) of the NYSE MKT Company Guide. Such options vest at the rate of 25% of the shares on the first anniversary of the commencement of such employee's employment with the Company, and then one forty-eighth (1/48) of the shares monthly thereafter subject to such employee's continued service. The following table summarizes the Company's inducement grant stock option activities: Shares Weighted Average Exercise Prices Remaining Contractual Life Aggregate Intrinsic Value (in thousands) Balance at January 31, 2015 — — — — Granted $ Balance at January 31, 2016 $ $ Vested and exercisable — $ — — $ — Vested and expected to vest $ $ The following table summarizes significant ranges of outstanding and exercisable options as of January 31, 2016: Options Outstanding Options Vested and Exercisable Range of Exercise Price Number Outstanding Weighted Average Remaining Contractual Life (in Years) Weighted Average Exercise Prices Number Vested and Exercisable Weighted Average Exercise Prices $0.25 - $1.00 $ $ $1.01 - $1.67 $ $ $1.68 - $3.00 $ $ $3.01 - $3.25 $ — — $ $ The total intrinsic value of stock options exercised during the year ended January 31, 2016, the month ended January 31, 2015 and year ended December 31, 2014 was $1.4 million, $82,000 and $676,000, respectively. The weighted average grant date fair values of the stock options granted during the year ended January 31, 2016, the month ended January 31, 2015 and year ended December 31, 2014 was $1.44, $1.92 and $1.10, respectively. |
STOCK-BASED COMPENSATION59
STOCK-BASED COMPENSATION | 6 Months Ended | 12 Months Ended |
Jul. 31, 2016 | Jan. 31, 2016 | |
STOCK-BASED COMPENSATION | ||
STOCK-BASED COMPENSATION | 8. STOCK-BASED COMPENSATION The following table summarizes the stock-based compensation expenses included in the unaudited condensed consolidated statement of operations and comprehensive loss (in thousands): For the three months ended For the six months ended 2016 2015 2016 2015 Research and development $ $ $ $ Sales and marketing General and administrative expenses Total $ $ $ $ The Company estimates the fair value of stock options granted using the Black-Scholes pricing model. This model also requires subjective assumptions, including future stock price volatility and expected time to exercise, which greatly affect the calculated values. For employee grants, the fair value is amortized on a straight-line basis over the requisite service periods of the awards, which is generally the vesting period. As of July 31, 2016, total compensation costs related to unvested, but not yet recognized, stock-based awards was $2.7 million, net of estimated forfeitures. This cost will be amortized on a straight-line basis over a weighted average remaining period of 2.76 years and will be adjusted for subsequent changes in estimated forfeitures. Valuation Assumptions The following assumptions were used to calculate the estimated fair value of awards granted during the three and six months ended July 31, 2016: For the three months ended For the six months ended 2016 2015 2016 2015 Expected volatility 97.0% - 98.6% 97.0% - 98.6% Expected term in years Risk-free interest rate 1.14% - 1.28% 1.14% - 1.28% 1.62% - 1.71% Expected dividend yield — — — — Expected Term The expected term represents the period that the Company’s stock-based awards are expected to be outstanding. For awards granted subject only to service vesting requirements, the Company utilizes the simplified method for estimating the expected term of the stock-based award, instead of historical exercise data. Expected Volatility The Company uses the historical volatility of the price of shares of common stock of selected public companies, including the Company’s stock price, in the biotechnology sector due to its limited trading history. Risk-Free Interest Rate The Company bases the risk-free interest rate used in the Black-Scholes pricing method upon the implied yield curve currently available on U.S. Treasury zero-coupon issues with a remaining term equal to the expected term used as the assumption in the model. Expected Dividend The Company has never paid dividends on its shares of common stock and currently does not intend to do so and, accordingly, the dividend yield percentage is zero for all periods. | 7. STOCK-BASED COMPENSATION The following table summarizes the stock-based compensation expenses included in the Company's Statement of Operations and Comprehensive Loss for the periods ended (in thousands): Year ended January 31, One month ended January 31, Year ended December 31, 2016 2015 2014 Research and development $ $ Sales and marketing General and administrative Total $ $ $ The Company estimates the fair value of stock options granted using the Black-Scholes pricing model. This model also requires subjective assumptions, including future stock price volatility and expected time to exercise, which greatly affect the calculated values. For employee grants, the fair value is amortized on a straight-line basis over the requisite service periods of the awards, which is generally the vesting period. As of January 31, 2016, total compensation costs related to unvested, but not yet recognized, stock-based awards was $2.7 million, net of estimated forfeitures. This cost will be amortized on a straight-line basis over a weighted average remaining period of 3.02 years and will be adjusted for subsequent changes in estimated forfeitures. Valuation Assumptions The following assumptions were used to calculate the estimated fair value of awards granted for the periods ended: Year ended January 31, One month ended January 31, Year ended December 31, 2016 2015 2014 Expected volatility 81.3% - 82.6% % % Expected term in years 6.0 Risk-free interest rate 1.57% - 2.26% % % Expected dividend yield —% — % — % Expected Term The expected term represents the period that the Company's stock-based awards are expected to be outstanding. For awards granted subject only to service vesting requirements, the Company utilizes the simplified method for estimating the expected term of the stock-based award, instead of historical exercise data. Expected Volatility The Company uses the historical volatility of the price of the common shares of selected public companies in the biotechnology sector due to its limited trading history. Expected Dividend The Company has never paid dividends on its common shares and currently does not intend to do so and, accordingly, the dividend yield percentage is zero for all periods. Risk-Free Interest Rate The Company bases the risk-free interest rate used in the Black-Scholes pricing method upon the implied yield curve currently available on U.S. Treasury zero-coupon issues with a remaining term equal to the expected term used as the assumption in the model. |
INCOME TAXES60
INCOME TAXES | 6 Months Ended | 12 Months Ended |
Jul. 31, 2016 | Jan. 31, 2016 | |
INCOME TAXES | ||
INCOME TAXES | 9. INCOME TAXES The Company evaluates its ability to recover deferred tax assets, in full or in part, by considering all available positive and negative evidence, including past operating results and its forecast of future taxable income on a jurisdictional basis. The Company bases its estimate of current and deferred taxes on the tax laws and rates that are currently in effect in the appropriate jurisdiction. Changes in laws or rates may affect the tax provision as well as the amount of deferred tax assets or liabilities. Current tax laws impose substantial restrictions on the utilization of net operating loss and credit carry-forwards in the event of an “ownership change,” as defined by the Internal Revenue Code. If there should be an ownership change, the Company’s ability to utilize its carry-forwards could be limited. As of July 31, 2016 and January 31, 2016, the Company has not recorded any liability for unrecognized tax benefits related to uncertain tax positions. The 2011 to 2015 tax years remain open for examination by the federal and state authorities. | 9. INCOME TAXES No federal income taxes were provided in the year ended January 31, 2016, month ended January 31, 2015 or year ended December 31, 2014 due to the Company's net losses. The provision of income taxes consist of state minimum income taxes. At January 31, 2016, the Company had available federal net operating loss ("NOL") carry-forwards of approximately $19.4 million which will begin to expire in 2030 and California state NOL carry-forwards of approximately $19.4 million which will begin to expire in 2030. At January 31, 2016 and 2015, the net deferred tax assets of approximately $8.8 million and $3.6 million, respectively, generated primarily by NOL carry-forwards, have been fully reserved due to the uncertainty surrounding the realization of such benefits. The net valuation allowance increased by approximately $5.2 million, $0.4 million and $2.6 million during the year ended January 31, 2016, the month ended January 31, 2015 and year ended December 31, 2014, respectively. Current tax laws impose substantial restrictions on the utilization of net operating loss and credit carry-forwards in the event of an "ownership change," as defined by the Internal Revenue Code. If there should be an ownership change, the Company's ability to utilize its carry-forwards could be limited. Significant components of the Company's deferred tax assets were as follows (in thousands): January 31, 2016 2015 Deferred tax assets: Net operating loss carryforwards $ $ Stock-based compensation expense — Tax credit carryforwards — Other Total deferred tax assets Less: Valuation allowance ) ) Net deferred tax assets $ — $ — A reconciliation of income taxes provided at the federal statutory rate (34%) to the actual income tax provision was as follows (in thousands): Year ended January 31, 2016 Income tax benefit computed at U.S. statutory rate $ ) State income tax (net of federal benefit) ) Stock-based compensation Warrant valuation Research and development credits ) Change in valuation allowance Other Income tax provision $ As of January 31, 2016 and 2015, the Company did not have any material unrecognized tax benefits. The tax years from 2010 to 2016 remain open for examination by the federal and state authorities. |
SUBSEQUENT EVENTS61
SUBSEQUENT EVENTS | 6 Months Ended | 12 Months Ended |
Jul. 31, 2016 | Jan. 31, 2016 | |
SUBSEQUENT EVENTS | ||
SUBSEQUENT EVENTS. | 10. SUBSEQUENT EVENTS In August 2016, the Company (i) raised net proceeds of approximately $1.4 million in a private offering of 2,423,077 shares of its common stock at $0.65 per share and (ii) issued convertible promissory notes in the principal amount of $1.5 million. One convertible promissory note is secured, has a principal amount of $1.0 million and matures 36 months from the date of issuance if not earlier converted pursuant to the terms therein. The secured note is convertible into shares of the Company’s common stock at a conversion rate of $0.80 per share and bears interest at a rate of 10% per year. The secured note will automatically convert into shares of the Company’s common stock at the conversion price on the earlier of (a) the closing of a Qualified Financing Event, (b) the Maturity Date, or (c) a Liquidation Event, each as defined and as further described in the secured note. In connection with the issuance of the secured note, the Company entered into a security agreement with the investor pursuant to which the investor was granted a security interest in substantially all assets of the Company. The other convertible promissory note is unsecured, has a principal amount of $0.5 million and matures six months from the date of issuance if not earlier converted pursuant to the terms therein. The unsecured note is convertible into shares of the Company’s common stock at a conversion rate of $0.80 per share and bears interest at a rate of 10% per year. The unsecured note will automatically convert into shares of the Company’s common stock at the conversion price on the earlier of (a) the Maturity Date, (b) the closing of a public offering of equity securities or securities convertible into equity securities or (c) a Liquidation Event, each as defined and as further described in the unsecured note. In connection with the August 2016 private placements, the Company entered into a standstill agreement with certain investors in the common stock offering as well as a registration rights agreement with all investors in the common stock offering, and registration rights agreements with each of the holders of the convertible promissory notes. | 10. SUBSEQUENT EVENTS In April 2016, the Company raised net proceeds of approximately $3.6 million, after expenses of approximately $0.7 million, excluding any proceeds from warrant exercises, from the sale of 3,600,000 shares of common stock and 1,952,000 warrants to purchase common stock at an exercise price of $1.20 per share in an equity offering under its shelf registration statement. |
DESCRIPTION OF BUSINESS AND S62
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended | 12 Months Ended |
Jul. 31, 2016 | Jan. 31, 2016 | |
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Basis of Presentation and Principles of Consolidation | Basis of Presentation and Principles of Consolidation These unaudited interim condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting and include the accounts of the Company and its subsidiary. Certain information and note disclosures normally included in the consolidated financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. Accordingly, these unaudited interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the year ended January 31, 2016, filed on May 2, 2016. The condensed consolidated balance sheet as of January 31, 2016, included herein, was derived from the audited consolidated financial statements as of that date. The unaudited interim condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary and have been prepared on the same basis as the audited consolidated financial statements and include all adjustments, consisting only of normal recurring adjustments, necessary for the fair presentation of the Company’s statement of financial position as of July 31, 2016 and January 31, 2016, and the Company’s results of operations and its cash flows for the three and six months ended July 31, 2016 and 2015. The results for the three and six months ended July 31, 2016 are not necessarily indicative of the results to be expected for the year ending January 31, 2017 or any future period | Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America ("GAAP"). The accompanying financial statements include the accounts of BioPharmX and its wholly-owned subsidiary. All intercompany transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses recognized during the reported period. Actual results could differ from those estimates. | Use of Estimates The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses recognized during the reported period. Actual results could differ from those estimates. |
Inventories | Inventories Inventories are stated at the lower of cost or market. Cost is determined using the standard cost method which approximates actual cost on a first-in, first-out basis. Market value is determined as the lower of replacement cost or net realizable value. The Company regularly reviews inventory quantities in consideration of actual loss experiences, projected future demand and remaining shelf life to record a provision for excess and obsolete inventory when appropriate. | Inventories Inventories are stated at the lower of cost or market. Cost is determined using the standard cost method which approximates actual cost on a first-in, first-out basis. Market value is determined as the lower of replacement cost or net realizable value. The Company regularly reviews inventory quantities in consideration of actual loss experiences, projected future demand and remaining shelf life to record a provision for excess and obsolete inventory when appropriate. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset might not be recoverable. When such an event occurs, management determines whether there has been an impairment by comparing the anticipated undiscounted future net cash flows to the related asset’s carrying value. If an asset is considered impaired, the asset is written down to fair value, which is determined based either on discounted cash flows or appraised value, depending on the nature of the asset. The Company has not identified any such impairment losses to date. | Impairment of Long-Lived Assets The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset might not be recoverable. When such an event occurs, management determines whether there has been an impairment by comparing the anticipated undiscounted future net cash flows to the related asset's carrying value. If an asset is considered impaired, the asset is written down to fair value, which is determined based either on discounted cash flows or appraised value, depending on the nature of the asset. The Company has not identified any such impairment losses to date. |
Advertising Expenses | Advertising Expenses The Company expenses the costs of advertising, including promotional expenses, as incurred. Advertising expenses were approximately $59,000 and $313,000 for the three months ended July 31, 2016 and 2015, respectively. Advertising expenses were approximately $278,000 and $549,000 for the six months ended July 31, 2016 and 2015, respectively. | Advertising Expenses The Company expenses the costs of advertising, including promotional expenses, as incurred. Advertising expenses were $1.2 million for year ended January 31, 2016, $90,000 for the one month ended January 31, 2015 and $68,000 for the year ended December 31, 2014. |
Net Loss Per Share | Net Loss per Share Basic net loss per share attributable to common stockholders is calculated based on the weighted-average number of shares of the Company’s common stock outstanding during the period. The weighted average shares outstanding for the three and six months ended July 31, 2016 excludes 193,333 of unvested common stock. Diluted net loss per share attributable to common stockholders is calculated based on the weighted-average number of shares of the Company’s common stock outstanding and other dilutive securities outstanding during the period. The potential dilutive shares of common stock resulting from the assumed exercise of outstanding stock options, warrants and the assumed conversion of preferred stock are determined under the treasury stock method. For the three months ended July 31, 2016 and 2015, approximately 10,002,000 and 4,837,000 potentially dilutive securities, respectively, were excluded from the computation of diluted loss per share because their effect on net loss per share would be anti-dilutive. | Net Loss Per Share Basic net loss per share attributable to common stockholders is calculated based on the weighted-average number of shares of the Company's common stock outstanding during the period. Diluted net loss per share attributable to common stockholders is calculated based on the weighted-average number of shares of the Company's common stock outstanding and other dilutive securities outstanding during the period. The potential dilutive shares of common stock resulting from the assumed exercise of outstanding stock options, warrants and the assumed conversion of preferred stock are determined under the treasury stock method. As of January 31, 2016, January 31, 2015 and December 31, 2014, 5,741,000, 9,793,000 and 9,713,000 potentially dilutive securities, respectively, were excluded from the computation of diluted loss per share because their effect on net loss per share would be anti-dilutive. |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies These unaudited interim condensed consolidated financial statements and accompanying notes should be read in conjunction with the Company’s annual financial statements and notes thereto contained in the Annual Report on Form 10-K for the fiscal year ended January 31, 2016. There have been no significant changes in the Company’s significant accounting policies for the three months ended July 31, 2016, as compared to the significant accounting policies described in the Annual Report on Form 10-K for the fiscal year ended January 31, 2016. | |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In February 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2016-02, Leases, which requires entities to recognize assets and liabilities for leases with lease terms greater than twelve months. The new guidance also requires quantitative and qualitative disclosures regarding the amount, timing and uncertainty of cash flows arising from leases. The standard is effective for annual and interim periods beginning after December 15, 2018, with early adoption permitted upon issuance. The Company is in the process of evaluating the impact of adoption on its consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-09, Compensation — Stock Compensation: Improvements to Employee Share-Based Payment Accounting, which relates to the accounting for employee share-based payments. This standard provides guidance on simplifying several aspects of the accounting for employee share-based payment transactions, including the income tax consequences, accounting for forfeitures and classification of excess tax benefits on the statement of cash flows. This standard will be effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. The Company is in the process of evaluating the impact of adoption on its consolidated financial statements. In April 2016, the FASB issued ASU No. 2016-10, Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing, which addresses certain implementation issues that have surfaced since the issuance of ASU No. 2014-09 in May 2014. ASU No. 2016-10 provides guidance in identifying performance obligations and determining the appropriate accounting for licensing arrangements. This standard will be effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company is in the process of evaluating the impact of adoption on its consolidated financial statements. In May 2016, the FASB issued ASU No. 2016-12, Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients. ASU No. 2016-12 will affect all entities that enter into contracts with customers to transfer goods or services that are an output of the entity’s ordinary activities in exchange for consideration. The amendments in this update affect the guidance in ASU No. 2014-09 which is not yet effective. The amendments in this update also affect narrow aspects of Topic 606 including among others: assessing collectability criterion, noncash consideration, and presentation of sales taxes and other similar taxes collected from customers. The effective date of this update is the same as ASU No. 2014-09. The Company is in the process of evaluating the impact of adoption on its consolidated financial statements. | Recent Accounting Pronouncements In July 2015, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2015-11, Inventory (Topic 330), Simplifying the Measurement of Inventory, which applies to all inventory except that which is measured using last-in, first-out (LIFO) or the retail inventory method. Inventory measured using first-in, first-out (FIFO) or average cost is included in the new amendment. The amendment will take effect for public business entities for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. The Company is in the process of evaluating the impact of adoption on the its consolidated financial statements. In August 2015, FASB issued Accounting Standards Update No. 2015-14, Revenue from Contracts with Customers (ASU No. 2014-09). This update defers the effective dates of ASU No. 2014-09 (originally issued in June 2014) for public business entities by one year, or until annual reporting periods beginning after December 15, 2017, including interim reporting periods within the reporting period. ASU No. 2014-09 gives entities a single comprehensive model to use in reporting information about the amount and timing of revenue resulting from contracts to provide goods or services to customers. The proposed ASU, which would apply to any entity that enters into contracts to provide goods or services, would supersede the revenue recognition requirements in Topic 605, Revenue Recognition, and most industry-specific guidance throughout the Industry Topics of the Codification. Additionally, the update would supersede some cost guidance included in Subtopic 605-35, Revenue Recognition—Construction-Type and Production-Type Contracts. The update removes inconsistencies and weaknesses in revenue requirements and provides a more robust framework for addressing revenue issues and more useful information to users of financial statements through improved disclosure requirements. In addition, the update improves comparability of revenue recognition practices across entities, industries, jurisdictions, and capital markets and simplifies the preparation of financial statements by reducing the number of requirements to which an entity must refer. The Company is continuing to review the provisions of this ASU to determine if there will be any impact on its results of operations, cash flows or financial condition. In February 2016, FASB issued ASU No. 2016-02, Leases, which requires entities to recognize assets and liabilities for leases with lease terms greater than twelve months. The new guidance also requires quantitative and qualitative disclosures regarding the amount, timing and uncertainty of cash flows arising from leases. The standard is effective for annual and interim periods beginning after December 15, 2018, with early adoption permitted upon issuance. The Company is in process of evaluating the impact of adoption on its consolidated financial statements. In August 2014, FASB issued ASU No. 2014-15, Presentation of Financial Statements—Going Concern (Subtopic 205-40). This ASU provides guidance to determine when and how to disclose going-concern uncertainties in the financial statements. The new standard requires management to perform interim and annual assessments of an entity's ability to continue as a going concern within one year of the date that the financial statements are issued. An entity must provide certain disclosures if conditions or events raise substantial doubt about the entity's ability to continue as a going concern. This standard is effective for annual periods ending after December 15, 2016. The Company is evaluating the impact of the adoption of this ASU on its consolidated financial statements. The Company has reviewed other recent accounting pronouncements and concluded they are either not applicable to the business, or no material effect is expected on the consolidated financial statements as a result of future adoption. |
BALANCE SHEET DETAILS (Tables63
BALANCE SHEET DETAILS (Tables) | 6 Months Ended | 12 Months Ended |
Jul. 31, 2016 | Jan. 31, 2016 | |
BALANCE SHEET DETAILS | ||
Schedule of Inventories | July 31, January 31, (in thousands) Inventories: Work in process $ $ Finished goods Channel inventory Total $ $ | January 31, 2016 2015 (in thousands) Inventories: Work in process $ $ Finished goods Channel inventory $ $ |
COMMITMENTS AND CONTINGENCIES64
COMMITMENTS AND CONTINGENCIES (Tables) | 6 Months Ended | 12 Months Ended |
Jul. 31, 2016 | Jan. 31, 2016 | |
COMMITMENTS AND CONTINGENCIES | ||
Future minimum commitments | The following table summarizes the Company’s commitments as of July 31, 2016 (in thousands): Total 2017 2018 2019 2020 2021 Operating lease $ $ $ — $ — $ — $ — Purchase commitment Total $ $ $ $ $ $ | The following table summarizes the Company's commitments as of January 31, 2016 (in thousands): Total 2017 2018 2019 2020 2021 Operating lease $ $ $ — $ — $ — $ — Purchase commitment Total $ $ $ $ $ $ |
CONVERTIBLE REDEEMABLE PREFER65
CONVERTIBLE REDEEMABLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY (Tables) | 6 Months Ended | 12 Months Ended |
Jul. 31, 2016 | Jan. 31, 2016 | |
Schedule of significant ranges of outstanding and exercisable options | The following table summarizes significant ranges of outstanding and exercisable options as of July 31, 2016: Options Outstanding Options Vested and Exercisable Range of Exercise Price Number Weighted Weighted Number Weighted $0.25 - $0.62 $ $ $0.63 - $1.00 $ $ $1.01 - $1.67 $ $ $1.68 - $3.00 $ $ $3.01 - $3.25 $ $ $ $ | Options Outstanding Options Vested and Exercisable Range of Exercise Price Number Outstanding Weighted Average Remaining Contractual Life (in Years) Weighted Average Exercise Prices Number Vested and Exercisable Weighted Average Exercise Prices $0.25 - $1.00 $ $ $1.01 - $1.67 $ $ $1.68 - $3.00 $ $ $3.01 - $3.25 $ — — $ $ |
2014 Equity Incentive Plan | ||
Stock option plan activity | Available Shares Weighted Remaining Aggregate (in thousands) Outstanding as of January 1, 2016 $ $ Exercised — ) $ Cancelled ) $ Outstanding as of April 30 2016 $ $ Shares authorized for issuance — Granted ) $ Exercised — ) $ Cancelled ) $ Expired upon termination of the 2014 Plan ) — $ — Outstanding as of July 31, 2016 $ $ Vested and exercisable $ $ Vested and expected to vest $ $ | Available for Grant Shares Weighted Average Exercise Prices Remaining Contractual Life Aggregate Intrinsic Value (in thousands) Balance at January 1, 2013 $ Granted ) Balance at December 31, 2013 $ Additional shares authorized — — Granted ) Exercised — ) Cancelled ) Balance at December 31, 2014 $ $ Granted ) Exercised — ) Cancelled ) Balance at January 31, 2015 $ $ Granted ) Exercised — ) Cancelled ) Balance at January 31, 2016 $ $ Vested and exercisable $ $ Vested and expected to vest $ $ |
Outside the 2014 Equity Incentive Plan | ||
Stock option plan activity | Shares Weighted Remaining Aggregate (in thousands) Balance at January 31, 2016, April 30, 2016 and July 31, 2016 $ $ — Vested and exercisable — $ — — $ — Vested and expected to vest $ $ — | Shares Weighted Average Exercise Prices Remaining Contractual Life Aggregate Intrinsic Value (in thousands) Balance at January 31, 2015 — — — — Granted $ Balance at January 31, 2016 $ $ Vested and exercisable — $ — — $ — Vested and expected to vest $ $ |
STOCK-BASED COMPENSATION (Tab66
STOCK-BASED COMPENSATION (Tables) | 6 Months Ended | 12 Months Ended |
Jul. 31, 2016 | Jan. 31, 2016 | |
STOCK-BASED COMPENSATION | ||
Summary of stock based compensation expense | The following table summarizes the stock-based compensation expenses included in the unaudited condensed consolidated statement of operations and comprehensive loss (in thousands): For the three months ended For the six months ended 2016 2015 2016 2015 Research and development $ $ $ $ Sales and marketing General and administrative expenses Total $ $ $ $ | The following table summarizes the stock-based compensation expenses included in the Company's Statement of Operations and Comprehensive Loss for the periods ended (in thousands): Year ended January 31, One month ended January 31, Year ended December 31, 2016 2015 2014 Research and development $ $ Sales and marketing General and administrative Total $ $ $ |
Black-Scholes option pricing model fair value assumptions | For the three months ended For the six months ended 2016 2015 2016 2015 Expected volatility 97.0% - 98.6% 97.0% - 98.6% Expected term in years Risk-free interest rate 1.14% - 1.28% 1.14% - 1.28% 1.62% - 1.71% Expected dividend yield — — — — | Year ended January 31, One month ended January 31, Year ended December 31, 2016 2015 2014 Expected volatility 81.3% - 82.6% % % Expected term in years 6.0 Risk-free interest rate 1.57% - 2.26% % % Expected dividend yield —% — % — % |
DESCRIPTION OF BUSINESS AND S67
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Offerings (Details) $ in Thousands | 1 Months Ended | 6 Months Ended | 12 Months Ended | ||||
Aug. 31, 2016USD ($) | Apr. 30, 2016USD ($) | Dec. 31, 2015USD ($) | Jun. 30, 2015USD ($) | Jul. 31, 2016USD ($)subsidiary | Jul. 31, 2015USD ($) | Jan. 31, 2016USD ($)item | |
Other Disclosures | |||||||
Number of wholly owned subsidiaries | 1 | 1 | |||||
Net proceeds from the sale of common stock | $ 13,316 | ||||||
Net proceeds from the issuance of common stock and warrants | $ 3,583 | $ 7,821 | |||||
Subsequent event | Convertible Note | |||||||
Other Disclosures | |||||||
Net proceeds from convertible promissory notes | $ 1,500 | ||||||
Private Placement | |||||||
Other Disclosures | |||||||
Net proceeds from the sale of common stock | $ 5,500 | ||||||
Private Placement | Subsequent event | Convertible Note | |||||||
Other Disclosures | |||||||
Net proceeds from convertible promissory notes | 1,500 | ||||||
Private Placement | Common Stock | Subsequent event | |||||||
Other Disclosures | |||||||
Net proceeds from private offering | $ 1,400 | ||||||
Public Offering | |||||||
Other Disclosures | |||||||
Net proceeds from the sale of common stock | $ 7,800 | ||||||
Net proceeds from the issuance of common stock and warrants | $ 3,600 | ||||||
Public Offering | Subsequent event | |||||||
Other Disclosures | |||||||
Net proceeds from the issuance of common stock and warrants | $ 3,600 |
DESCRIPTION OF BUSINESS AND S68
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Advertising Expenses (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Jan. 31, 2015 | Jul. 31, 2016 | Jul. 31, 2015 | Jul. 31, 2016 | Jul. 31, 2015 | Jan. 31, 2016 | Dec. 31, 2014 | |
Advertising Expenses | |||||||
Advertising expenses | $ 90,000 | $ 59,000 | $ 313,000 | $ 278,000 | $ 549,000 | $ 1,200,000 | $ 68,000 |
DESCRIPTION OF BUSINESS AND S69
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Net Loss Per Share (Details) - shares | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||
Jan. 31, 2015 | Jul. 31, 2016 | Jul. 31, 2015 | Jan. 31, 2016 | Dec. 31, 2014 | |
Net Loss Per Share | |||||
Stock expected to vest | 193,333 | ||||
Anti dilutive securities excluded from computation of diluted net loss per share | 9,793,000 | 10,002,000 | 4,837,000 | 5,741,000 | 9,713,000 |
GOING CONCERN (Details)70
GOING CONCERN (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||||
Aug. 31, 2016 | Jan. 31, 2015 | Jul. 31, 2016 | Jul. 31, 2015 | Jul. 31, 2016 | Jul. 31, 2015 | Jan. 31, 2016 | Dec. 31, 2014 | Dec. 31, 2013 | |
Cash and cash equivalents | $ 1,305 | $ 436 | $ 7,388 | $ 436 | $ 7,388 | $ 4,039 | $ 2,111 | $ 3 | |
Working capital (deficit) | (3,500) | (3,500) | 1,600 | ||||||
Net loss available to common stockholders | (1,237) | (5,034) | $ (3,735) | (9,495) | $ (7,598) | (16,001) | $ (8,129) | ||
Accumulated equity deficit | $ (10,634) | $ (35,727) | $ (35,727) | $ (26,232) | |||||
Subsequent event | |||||||||
Net proceeds from common stock and convertible promissory notes | $ 2,900 |
FAIR VALUE MEASUREMENTS (Detail
FAIR VALUE MEASUREMENTS (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended |
Jul. 31, 2016 | Jan. 31, 2016 | |
Fair Value Measurements | ||
Unrealized gains (losses) | $ 0 | |
Money Market Funds | ||
Fair Value Measurements | ||
Unrealized gains (losses) | $ 0 | |
Level 1 | ||
Fair Value Measurements | ||
Available-for-sale securities | $ 3.6 | |
Level 1 | Money Market Funds | ||
Fair Value Measurements | ||
Available-for-sale securities | $ 0.2 |
BALANCE SHEET DETAILS (Details)
BALANCE SHEET DETAILS (Details) - USD ($) $ in Thousands | Jul. 31, 2016 | Jan. 31, 2016 | Jan. 31, 2015 |
Inventories: | |||
Work in process | $ 54 | $ 18 | $ 61 |
Finished goods | 17 | 28 | 64 |
Channel inventory | 41 | 54 | 35 |
Total | $ 112 | $ 100 | $ 160 |
RELATED PARTY PAYABLES (Detai73
RELATED PARTY PAYABLES (Details) - USD ($) | Jul. 31, 2016 | Jan. 31, 2016 | Jan. 31, 2015 |
RELATED PARTY PAYABLES | |||
Related party payables | $ 104,000 | $ 225,000 | $ 218,000 |
COMMITMENTS AND CONTINGENCIES74
COMMITMENTS AND CONTINGENCIES - Lease Arrangements (Details) | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||
Jan. 31, 2015USD ($) | Jul. 31, 2016USD ($) | Jul. 31, 2015USD ($) | Jul. 31, 2016USD ($) | Jul. 31, 2015USD ($) | Jan. 31, 2016USD ($)ft² | Dec. 31, 2014USD ($) | Aug. 23, 2013ft² | |
Operating lease commitments | ||||||||
2,017 | $ 99,000 | $ 99,000 | $ 246,000 | |||||
Total | 99,000 | 99,000 | 246,000 | |||||
Purchase commitments | ||||||||
2,017 | 316,000 | 316,000 | 421,000 | |||||
2,018 | 263,000 | 263,000 | 263,000 | |||||
2,019 | 263,000 | 263,000 | 263,000 | |||||
2,020 | 263,000 | 263,000 | 263,000 | |||||
2,021 | 263,000 | 263,000 | 263,000 | |||||
Total | 1,368,000 | 1,368,000 | 1,473,000 | |||||
Contractual obligation commitments | ||||||||
2,017 | 415,000 | 415,000 | 667,000 | |||||
2,018 | 263,000 | 263,000 | 263,000 | |||||
2,019 | 263,000 | 263,000 | 263,000 | |||||
2,020 | 263,000 | 263,000 | 263,000 | |||||
2,021 | 263,000 | 263,000 | 263,000 | |||||
Total | 1,467,000 | 1,467,000 | $ 1,719,000 | |||||
Rent expense | ||||||||
Leased office and laboratory space | ft² | 10,800 | 10,800 | ||||||
Rent expense | $ 26,000 | $ 86,000,000 | $ 94,000,000 | $ 172,000,000 | $ 172,000,000 | $ 357,000 | $ 310,000 |
COMMITMENTS AND CONTINGENCIES75
COMMITMENTS AND CONTINGENCIES - Legal Proceedings and License Agreement (Details) - License Agreement - Iogen LLC | 6 Months Ended | 12 Months Ended |
Jul. 31, 2016 | Jan. 31, 2016 | |
License Agreement | ||
Non Royalty license fee equal to a certain percentage of net profit associated with OTC product | 30.00% | 30.00% |
Non Royalty license fee equal to a certain percentage of net royalties received from any sub-licensee | 30.00% | 30.00% |
Prescription Iodine Tablet | ||
License Agreement | ||
Royalty fee percentage based on net sales over a specific time period of commercialization | 3.00% | 3.00% |
Royalty fee percentage based on net sales after a specific period of time | 2.00% | 2.00% |
Time period for determining initial royalty fee as a percent of net sales | 24 months | 24 months |
Other Products | ||
License Agreement | ||
Royalty fee percentage based on net sales over a specific time period of commercialization | 3.00% | 3.00% |
Royalty fee percentage based on net sales from initial period until expiration of applicable patents | 2.00% | 2.00% |
Royalty fee percentage based on net sales after a specific period of time | 1.00% | 1.00% |
Time period for determining initial royalty fee as a percent of net sales | 12 months | 12 months |
COMMITMENTS AND CONTINGENCIES76
COMMITMENTS AND CONTINGENCIES - Intangible Assets (Details) - USD ($) | 6 Months Ended | 12 Months Ended | ||
Jul. 31, 2016 | Jan. 31, 2016 | Jan. 31, 2015 | Dec. 31, 2013 | |
Finite-Lived Intangible Assets | ||||
Fees to Iogen capitalized | $ 150,000 | $ 150,000 | ||
Intangible assets, net of amortization | $ 104,000 | 119,000 | ||
Royalties paid | $ 0 | 0 | ||
Intellectual Property | ||||
Finite-Lived Intangible Assets | ||||
Fees to Iogen capitalized | $ 150,000 | |||
Intangible assets, net of amortization | $ 119,000 | $ 149,000 |
CONVERTIBLE REDEEMABLE PREFER77
CONVERTIBLE REDEEMABLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY - Common Stock (Details) - USD ($) | Oct. 24, 2014 | Apr. 30, 2016 | Dec. 31, 2015 | Jun. 30, 2015 | Jul. 31, 2016 | Jul. 31, 2015 | Jan. 31, 2016 | Dec. 31, 2014 | Dec. 14, 2015 | Jan. 31, 2015 |
Net proceeds from the sale of common stock | $ 13,316,000 | |||||||||
Shares issued | 28,881,351 | 25,208,684 | 11,415,416 | |||||||
Stock expected to vest | 193,333 | |||||||||
Net proceeds from the issuance of common stock and warrants | $ 3,583,000 | $ 7,821,000 | ||||||||
Common Stock | ||||||||||
Issuance of common stock | 12,508,395 | |||||||||
Conversion of convertible notes payable to common stock (in shares) | 1,526,001 | |||||||||
Korea Investment Partners | ||||||||||
Shares issued | 290,000 | |||||||||
Stock vested | 96,667 | |||||||||
Stock expected to vest | 193,333 | |||||||||
Convertible Note | ||||||||||
Conversion of convertible notes payable to common stock (in shares) | 182,266 | |||||||||
Interest rate (in percent) | 6.00% | |||||||||
Principal amount | $ 500,000 | |||||||||
Public Offering | ||||||||||
Issuance of common stock | 3,600,000 | 3,636,384 | ||||||||
Net proceeds from the sale of common stock | $ 7,800,000 | |||||||||
Price per share | $ 1.195 | |||||||||
Net proceeds from the issuance of common stock and warrants | $ 3,600,000 | |||||||||
Number of shares of common stock subject to warrant | 1,952,000 | |||||||||
Warrants exercise price | $ 1.20 | |||||||||
Private Placement | ||||||||||
Net proceeds from the sale of common stock | $ 5,500,000 | |||||||||
Korea Investment Partners | Subscription Agreement | Common Stock | ||||||||||
Shares issued | 1,081,081 | |||||||||
Price per share | $ 1.85 | |||||||||
Revenue from Violet | $ 2,000,000 | 2,000,000 | ||||||||
Subscription agreement receivable | $ 2,000,000 | $ 2,000,000 | ||||||||
Korea Investment Partners | Subscription Agreement | Common Stock | Minimum | ||||||||||
Price per share | $ 3.70 | $ 3.70 | ||||||||
Franklin Advisers | Private Placement | ||||||||||
Issuance of common stock | 4,100,000 | |||||||||
Net proceeds from the sale of common stock | $ 5,500,000 | |||||||||
Price per share | $ 1.43 | |||||||||
Period within which securities can be purchased | 5 years | |||||||||
Franklin Advisers | Private Placement | Maximum | ||||||||||
Percentage of securities offered by entity | 20.00% |
CONVERTIBLE REDEEMABLE PREFER78
CONVERTIBLE REDEEMABLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY - Series A Preferred Stock & Warrants (Details) - USD ($) | May 15, 2014 | May 14, 2014 | Apr. 30, 2016 | Jan. 31, 2016 | Jun. 30, 2015 | Apr. 30, 2015 | Jul. 31, 2015 | Jan. 31, 2016 | Dec. 31, 2014 | Jul. 31, 2016 | Mar. 31, 2015 |
Equity | |||||||||||
Proceeds from warrant exercises | $ 1,512,000 | $ 1,487,000 | |||||||||
Incremental fair value of warrants | $ 436,000 | $ 436,000 | |||||||||
Adjustment to paid-in capital, warrant fair value | $ 204,000 | ||||||||||
Public Offering | |||||||||||
Equity | |||||||||||
Number of shares of common stock subject to warrant | 1,952,000 | ||||||||||
Warrants exercise price | $ 1.20 | ||||||||||
Issuance of common stock, net of expenses of $2,500 (in shares) | 3,600,000 | 3,636,384 | |||||||||
Warrant | Public Offering | Underwriters | |||||||||||
Equity | |||||||||||
Number of shares of common stock subject to warrant | 109,091 | ||||||||||
Warrants exercise price | $ 2.75 | ||||||||||
Warrants expiration term | 5 years | ||||||||||
Series A Warrant | Warrant | |||||||||||
Equity | |||||||||||
Number of shares of common stock subject to warrant | 2,042,589 | ||||||||||
Warrants exercise price | $ 3.70 | ||||||||||
Adjustment to paid-in capital, warrant fair value | $ 845,000 | ||||||||||
Dividend rate | 0.00% | ||||||||||
Contractual term | 5 years | ||||||||||
Expected volatility | 88.80% | ||||||||||
Series A Warrant | Warrant | Minimum | |||||||||||
Equity | |||||||||||
Risk-free rate | 1.60% | ||||||||||
Series A Warrant | Warrant | Maximum | |||||||||||
Equity | |||||||||||
Risk-free rate | 4.00% | ||||||||||
Series A Convertible Redeemable Preferred Stock | |||||||||||
Equity | |||||||||||
Number of shares sold | 4,207,987 | ||||||||||
Series A Convertible Redeemable Preferred Stock | Public Offering | |||||||||||
Equity | |||||||||||
Number of common shares into which share is convertible | 4,319,426 | ||||||||||
Series A Convertible Redeemable Preferred Stock | Subscription Agreement | |||||||||||
Equity | |||||||||||
Number of shares sold | 4,207,987 | ||||||||||
Series A Convertible Redeemable Preferred Stock | Series A Warrant | |||||||||||
Equity | |||||||||||
Number of shares of common stock subject to warrant | 564,662 | 564,662 | |||||||||
Proceeds from warrant exercises | $ 1,411,655 | $ 1,411,655 | |||||||||
Incremental fair value of warrants | $ 436,000 | ||||||||||
Series A Convertible Redeemable Preferred Stock | Series A Warrant | Actual | |||||||||||
Equity | |||||||||||
Warrants exercise price | $ 2.50 | ||||||||||
Series A Convertible Redeemable Preferred Stock | Series A Warrant | Previously Reported | |||||||||||
Equity | |||||||||||
Warrants exercise price | $ 3.70 | $ 3.70 | |||||||||
Series A Convertible Redeemable Preferred Stock | Series A Warrant | Public Offering | |||||||||||
Equity | |||||||||||
Offering price per share that triggers the issuance of additional shares related to the public offering | $ 3.125 | ||||||||||
Percentage of public offering price | 80.00% | ||||||||||
Issuance of common stock, net of expenses of $2,500 (in shares) | 77,006 | ||||||||||
Series A Convertible Redeemable Preferred Stock | Series A Warrant | Warrant | |||||||||||
Equity | |||||||||||
Number of shares of common stock subject to warrant | 1,661,055 | 1,661,055 | 1,661,055 | ||||||||
Dividend rate | 0.00% | ||||||||||
Risk-free rate | 1.60% | ||||||||||
Expected volatility | 85.90% | ||||||||||
Series A Convertible Redeemable Preferred Stock | Series A Warrant | Warrant | Minimum | |||||||||||
Equity | |||||||||||
Contractual term | 4 years | ||||||||||
Series A Convertible Redeemable Preferred Stock | Series A Warrant | Warrant | Maximum | |||||||||||
Equity | |||||||||||
Contractual term | 5 years | ||||||||||
Series A Convertible Redeemable Preferred Stock | Service Provider Warrant | Warrant | |||||||||||
Equity | |||||||||||
Number of shares of common stock subject to warrant | 316,395 | ||||||||||
Warrants exercise price | $ 2.035 | ||||||||||
Warrant expense | $ 99,000 | ||||||||||
Series A Convertible Redeemable Preferred Stock | Convertible Debt Warrant | Warrant | |||||||||||
Equity | |||||||||||
Conversion of convertible notes payable to common stock (in shares) | 54,054 | ||||||||||
Number of shares of common stock subject to warrant | 343,559 | 289,505 | 289,505 | 289,505 | |||||||
Warrants exercise price | $ 1.85 | ||||||||||
Adjustment to paid-in capital, warrant fair value | $ 105,000 | ||||||||||
Contractual term | 5 years | 5 years |
CONVERTIBLE REDEEMABLE PREFER79
CONVERTIBLE REDEEMABLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY - Equity Incentive Plan (Details) - 2016 Equity Incentive Plan | 6 Months Ended |
Jul. 31, 2016shares | |
Share-based Compensation Arrangement by Share-based Payment Award | |
Number of shares reserved for issuance | 4,000,000 |
Options | |
Share-based Compensation Arrangement by Share-based Payment Award | |
Expiration period | 10 years |
Minimum | Options | |
Share-based Compensation Arrangement by Share-based Payment Award | |
Vesting period | 2 years |
Maximum | Options | |
Share-based Compensation Arrangement by Share-based Payment Award | |
Vesting period | 4 years |
CONVERTIBLE REDEEMABLE PREFER80
CONVERTIBLE REDEEMABLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY - Stock Option Activities (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||
Jan. 31, 2015 | Jul. 31, 2016 | Apr. 30, 2016 | Jul. 31, 2016 | Jan. 31, 2016 | Jan. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Weighted Average Exercise Prices | ||||||||
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price | $ 1.92 | $ 1.44 | $ 1.10 | |||||
Plans | ||||||||
Available for Grant | ||||||||
Available for grant, beginning | 438,375 | 350,875 | ||||||
Granted | (2,635,000) | |||||||
Cancelled | 358,416 | 87,500 | ||||||
Available for grant, ending | 350,875 | 2,140,100 | 438,375 | 2,140,100 | 350,875 | |||
Shares authorized for issuance | 4,000,000 | 4,000,000 | ||||||
Shares | ||||||||
Outstanding, Beginning | 2,562,775 | 2,704,608 | ||||||
Exercised | (18,334) | (54,333) | ||||||
Cancelled | (358,416) | (87,500) | ||||||
Outstanding, Ending | 2,704,608 | 4,821,025 | 2,562,775 | 4,821,025 | 2,704,608 | |||
Granted | 2,635,000 | |||||||
Vested and exercisable | 1,547,679 | 1,547,679 | ||||||
Vested and expected to vest | 4,295,839 | 4,295,839 | ||||||
Weighted Average Exercise Prices | ||||||||
Outstanding, Beginning | $ 1.61 | $ 1.59 | ||||||
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price | 0.64 | |||||||
Exercised | 0.35 | $ 0.33 | ||||||
Cancelled | 2.19 | 1.85 | ||||||
Outstanding, Ending | $ 1.59 | $ 0.95 | $ 1.61 | $ 0.95 | $ 1.59 | |||
Granted | 2,635,000 | |||||||
Vested and exercisable | $ 1.12 | 1.12 | ||||||
Vested and expected to vest | $ 0.97 | $ 0.97 | ||||||
Remaining Contractual Life | ||||||||
Outstanding | 8 years 5 months 1 day | 8 years 11 months 9 days | 8 years 4 months 13 days | |||||
Vested and exercisable | 7 years 8 months 5 days | |||||||
Vested and expected to vest | 8 years 10 months 6 days | |||||||
Aggregate Intrinsic Value | ||||||||
Outstanding | $ 1,343 | $ 502 | $ 340 | $ 502 | $ 1,343 | |||
Vested and exercisable | 237 | 237 | ||||||
Vested and expected to vest | $ 462 | $ 462 | ||||||
2014 Equity Incentive Plan | ||||||||
Available for Grant | ||||||||
Available for grant, beginning | 1,163,000 | 350,875 | 350,875 | 1,043,000 | 94,000 | 1,550,000 | ||
Granted | (130,000) | (1,274,000) | (891,000) | (1,456,000) | ||||
Cancelled | 10,000 | 581,875 | 160,000 | |||||
Expired upon termination of the 2014 Plan | (21,691) | |||||||
Available for grant, ending | 1,043,000 | 350,875 | 1,043,000 | 1,163,000 | 94,000 | |||
Shares | ||||||||
Outstanding, Beginning | 2,609,357 | 2,704,608 | 2,704,608 | 2,689,252 | 2,606,000 | 1,150,000 | ||
Exercised | (40,105) | (676,769) | (727,643) | |||||
Cancelled | (10,000) | (581,875) | (160,000) | |||||
Outstanding, Ending | 2,689,252 | 2,704,608 | 2,689,252 | 2,609,357 | 2,606,000 | |||
Granted | 130,000 | 1,274,000 | 891,000 | 1,456,000 | ||||
Vested and exercisable | 1,059,709 | |||||||
Vested and expected to vest | 2,467,713 | |||||||
Weighted Average Exercise Prices | ||||||||
Outstanding, Beginning | $ 0.82 | $ 1.59 | $ 1.59 | $ 0.91 | $ 0.25 | $ 0.06 | ||
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price | 2.75 | 2.25 | 1.85 | 0.40 | ||||
Exercised | 0.95 | 0.12 | 0.14 | |||||
Cancelled | 1.85 | 1.59 | 0.37 | |||||
Outstanding, Ending | $ 0.91 | $ 1.59 | $ 0.91 | $ 0.82 | $ 0.25 | |||
Granted | 130,000 | 1,274,000 | 891,000 | 1,456,000 | ||||
Vested and exercisable | $ 1.13 | |||||||
Vested and expected to vest | $ 1.55 | |||||||
Remaining Contractual Life | ||||||||
Outstanding | 8 years 6 months 29 days | 8 years 4 months 13 days | 8 years 6 months 7 days | |||||
Vested and exercisable | 7 years 4 months 2 days | |||||||
Vested and expected to vest | 8 years 3 months 15 days | |||||||
Aggregate Intrinsic Value | ||||||||
Outstanding | $ 5,625 | $ 1,343 | $ 5,625 | $ 5,686 | ||||
Vested and exercisable | 794 | |||||||
Vested and expected to vest | $ 1,287 | |||||||
Outside the 2014 Equity Incentive Plan | ||||||||
Available for Grant | ||||||||
Granted | (660,000) | |||||||
Shares | ||||||||
Outstanding, Beginning | 660,000 | 660,000 | 660,000 | |||||
Outstanding, Ending | 660,000 | 660,000 | 660,000 | 660,000 | ||||
Granted | 660,000 | |||||||
Vested and expected to vest | 561,692 | 561,692 | 529,212 | |||||
Weighted Average Exercise Prices | ||||||||
Outstanding, Beginning | $ 1.44 | $ 1.44 | $ 1.44 | |||||
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price | $ 1.44 | |||||||
Outstanding, Ending | 1.44 | $ 1.44 | 1.44 | $ 1.44 | ||||
Granted | 660,000 | |||||||
Vested and expected to vest | $ 1.44 | $ 1.44 | $ 1.44 | |||||
Remaining Contractual Life | ||||||||
Outstanding | 9 years 2 months 19 days | 9 years 2 months 19 days | 9 years 8 months 19 days | |||||
Vested and expected to vest | 9 years 2 months 19 days | 9 years 8 months 19 days | ||||||
Aggregate Intrinsic Value | ||||||||
Outstanding | $ 227 | |||||||
Vested and expected to vest | $ 182 | |||||||
Outside the 2014 Equity Incentive Plan | First anniversary | ||||||||
Available for Grant | ||||||||
Vesting percentage | 25.00% | 25.00% | ||||||
Outside the 2014 Equity Incentive Plan | Subsequent to first anniversary | ||||||||
Available for Grant | ||||||||
Vesting percentage | 2.083% | 2.083% |
CONVERTIBLE REDEEMABLE PREFER81
CONVERTIBLE REDEEMABLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY - Range of Exercise Price (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||
Jan. 31, 2015 | Jul. 31, 2016 | Apr. 30, 2016 | Jul. 31, 2015 | Jul. 31, 2016 | Jul. 31, 2015 | Jan. 31, 2016 | Dec. 31, 2014 | |
Options Outstanding | ||||||||
Number Outstanding (in shares) | 5,481,025 | 3,364,608 | ||||||
Weighted Average Remaining Contractual Life | 8 years 11 months 19 days | 8 years 7 months 17 days | ||||||
Weighted Average Exercise Prices (in dollars per share) | $ 1 | $ 1.56 | ||||||
Options Exercisable | ||||||||
Number Vested and Exercisable (in shares) | 1,547,679 | 1,059,709 | ||||||
Weighted Average Exercise Prices (in dollars per share) | $ 1.12 | $ 1.13 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures | ||||||||
Total intrinsic value of options exercised | $ 82,000 | $ 5,000 | $ 1,200,000 | $ 39,000 | $ 1,300,000 | $ 1,400,000 | $ 676,000 | |
$0.25 - $0.62 | ||||||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range | ||||||||
Exercise prices, low end of range (in dollars per share) | $ 0.25 | $ 0.25 | ||||||
Exercise prices, high end of range (in dollars per share) | $ 0.62 | $ 1 | ||||||
Options Outstanding | ||||||||
Number Outstanding (in shares) | 2,547,259 | 2,547,259 | 882,108 | |||||
Weighted Average Remaining Contractual Life | 9 years 18 days | 7 years 5 months 23 days | ||||||
Weighted Average Exercise Prices (in dollars per share) | $ 0.54 | $ 0.54 | $ 0.41 | |||||
Options Exercisable | ||||||||
Number Vested and Exercisable (in shares) | 781,418 | 781,418 | 570,340 | |||||
Weighted Average Exercise Prices (in dollars per share) | $ 0.42 | $ 0.42 | $ 0.41 | |||||
$3.01 - $3.25 | ||||||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range | ||||||||
Exercise prices, low end of range (in dollars per share) | 3.01 | |||||||
Exercise prices, high end of range (in dollars per share) | $ 3.25 | |||||||
Options Outstanding | ||||||||
Number Outstanding (in shares) | 45,000 | 45,000 | ||||||
Weighted Average Remaining Contractual Life | 1 month 21 days | |||||||
Weighted Average Exercise Prices (in dollars per share) | $ 3.25 | $ 3.25 | ||||||
Options Exercisable | ||||||||
Number Vested and Exercisable (in shares) | 45,000 | 45,000 | ||||||
Weighted Average Exercise Prices (in dollars per share) | $ 3.25 | $ 3.25 |
STOCK-BASED COMPENSATION - Ex82
STOCK-BASED COMPENSATION - Expense (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Jan. 31, 2015 | Jul. 31, 2016 | Jul. 31, 2015 | Jul. 31, 2016 | Jul. 31, 2015 | Jan. 31, 2016 | Dec. 31, 2014 | |
Share-based Compensation | |||||||
Stock-based compensation expense | $ 99 | $ 424 | $ 324 | $ 697 | $ 624 | $ 1,214 | $ 1,193 |
Total compensation costs not yet recognized | 2,700 | $ 2,700 | $ 2,700 | ||||
Average remaining amortization period for recognition of expense | 2 years 9 months 4 days | 3 years 7 days | |||||
Research and development | |||||||
Share-based Compensation | |||||||
Stock-based compensation expense | 27 | 129 | 39 | $ 205 | 125 | $ 256 | 228 |
Sales and marketing | |||||||
Share-based Compensation | |||||||
Stock-based compensation expense | 40 | 98 | 83 | 182 | 207 | 443 | 147 |
General and administrative. | |||||||
Share-based Compensation | |||||||
Stock-based compensation expense | $ 32 | $ 197 | $ 202 | $ 310 | $ 292 | $ 515 | $ 818 |
STOCK-BASED COMPENSATION - As83
STOCK-BASED COMPENSATION - Assumptions (Details) | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Jan. 31, 2015 | Jul. 31, 2016 | Jul. 31, 2015 | Jul. 31, 2016 | Jul. 31, 2015 | Jan. 31, 2016 | Dec. 31, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award | |||||||
Expected volatility | 82.10% | 82.60% | 82.60% | 82.20% | |||
Expected term in years | 6 years | 6 years 6 months | 6 years | 6 years 6 months | 6 years | 6 years | |
Risk-free interest rate | 1.56% | 1.71% | 1.74% | ||||
Minimum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||||
Expected volatility | 97.00% | 97.00% | 81.30% | ||||
Risk-free interest rate | 1.14% | 1.14% | 1.62% | 1.57% | |||
Maximum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||||
Expected volatility | 98.60% | 98.60% | 82.60% | ||||
Expected term in years | 6 years | ||||||
Risk-free interest rate | 1.28% | 1.28% | 1.71% | 2.26% |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Thousands | Jul. 31, 2016 | Jan. 31, 2016 |
INCOME TAXES | ||
Liability for unrecognized tax benefits | $ 0 | $ 0 |
SUBSEQUENT EVENTS (Details)85
SUBSEQUENT EVENTS (Details) - USD ($) $ / shares in Units, $ in Millions | 1 Months Ended | 12 Months Ended |
Aug. 31, 2016 | Jan. 31, 2016 | |
Common Stock | ||
SUBSEQUENT EVENTS | ||
Issuance of common stock | 12,508,395 | |
Subsequent event | Convertible Note | ||
SUBSEQUENT EVENTS | ||
Principal amount | $ 1.5 | |
Subsequent event | Convertible Note | Unsecured debt | ||
SUBSEQUENT EVENTS | ||
Principal amount | $ 0.5 | |
Maturity term (in months) | 6 months | |
Conversion price (in dollars per share) | $ 0.80 | |
Interest rate (in percent) | 10.00% | |
Subsequent event | Convertible Note | Secured debt | ||
SUBSEQUENT EVENTS | ||
Principal amount | $ 1 | |
Maturity term (in months) | 36 months | |
Conversion price (in dollars per share) | $ 0.80 | |
Interest rate (in percent) | 10.00% | |
Subsequent event | Private Placement | Convertible Note | ||
SUBSEQUENT EVENTS | ||
Principal amount | $ 1.5 | |
Subsequent event | Private Placement | Common Stock | ||
SUBSEQUENT EVENTS | ||
Net proceeds from private offering | $ 1.4 | |
Issuance of common stock | 2,423,077 | |
Share price (in dollars per share) | $ 0.65 |