Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2021 | Nov. 10, 2021 | |
Document and Entity Information | ||
Entity Registrant Name | Timber Pharmaceuticals, Inc. | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2021 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity File Number | 001-37411 | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 59-3843182 | |
Entity Address, Address Line One | 110 Allen Road, Suite 410 | |
Entity Address, City or Town | Basking Ridge | |
Entity Address, State or Province | NJ | |
Entity Address, Postal Zip Code | 07920 | |
City Area Code | 908 | |
Local Phone Number | 636-7163 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 63,796,170 | |
Entity Central Index Key | 0001504167 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Trading Symbol | TMBR | |
Title of 12(b) Security | Common Stock, par value $0.001 per share | |
Security Exchange Name | NYSEAMER |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
Current assets | ||
Cash | $ 3,357,136 | $ 10,348,693 |
Other current assets | 338,200 | 377,290 |
Total current assets | 3,695,336 | 10,725,983 |
Deposits | 127,534 | 114,534 |
Property and equipment, net | 17,012 | |
Right of use asset | 712,902 | 787,432 |
Total assets | 4,552,784 | 11,627,949 |
Current liabilities | ||
Accounts payable | 1,042,290 | 395,049 |
Accrued expenses | 659,865 | 768,661 |
Lease liability, current portion | 313,996 | 217,651 |
Total current liabilities | 2,016,151 | 1,381,361 |
Notes payable | 37,772 | 37,772 |
Lease liability | 419,683 | 579,455 |
Deferred tax liability | 37,842 | 37,842 |
Other liabilities | 73,683 | 73,683 |
Total liabilities | 2,585,131 | 2,110,113 |
Commitments and contingencies (Note 8) | ||
Redeemable Series A convertible preferred stock, par value $0.001; 2,500 shares authorized; 1,819 shares issued and outstanding as of September 30, 2021 and December 31, 2020 | 2,018,663 | 1,909,805 |
Stockholders' (deficit) equity | ||
Common stock, par value $0.001; 450,000,000 shares authorized; 36,659,685 shares issued and outstanding as of September 30, 2021, and 27,132,420 shares issued and outstanding as of December 31, 2020 | 36,660 | 27,132 |
Additional paid-in capital | 26,003,593 | 25,826,295 |
Accumulated deficit | (26,091,263) | (18,245,396) |
Total stockholders' (deficit) equity | (51,010) | 7,608,031 |
Total liabilities, redeemable convertible preferred stock, and stockholders' (deficit) equity | $ 4,552,784 | $ 11,627,949 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2021 | Dec. 31, 2020 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 450,000,000 | 450,000,000 |
Common stock, shares issued | 36,659,685 | 27,132,420 |
Common stock, shares outstanding | 36,659,685 | 27,132,420 |
Series A preferred stock | ||
Series A convertible preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Series A convertible preferred stock, shares authorized | 2,500 | 2,500 |
Series A convertible preferred stock, shares issued | 1,819 | 1,819 |
Total temporary equity, Shares | 1,819 | 1,819 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Total revenue | $ 266,974 | $ 324,521 | $ 696,527 | $ 351,428 |
Operating costs and expenses | ||||
Research and development | 1,974,193 | 685,207 | 4,623,811 | 2,239,607 |
Research and development - license acquired | 12,371,332 | |||
Transaction costs | 1,501,133 | |||
Selling, general and administrative | 1,296,641 | 1,233,849 | 3,918,042 | 2,745,728 |
Total operating expenses | 3,270,834 | 1,919,056 | 8,541,853 | 18,857,800 |
Loss from operations | (3,003,860) | (1,594,535) | (7,845,326) | (18,506,372) |
Other (expense) income | ||||
Interest expense | (4,416,746) | |||
Interest income | 816,655 | |||
Change in fair value of investment in BioPharmX | 559,805 | |||
Change in fair value of warrant liability | 4,423,833 | 5,607,293 | ||
Gain on foreign currency exchange | (1,544) | 7,197 | (541) | 11,651 |
Total other (expense) income | (1,544) | 4,431,030 | (541) | 2,578,658 |
Net (loss) income | (3,005,404) | 2,836,495 | (7,845,867) | (15,927,714) |
Accrued dividend on preferred stock units | (52,669) | |||
Cumulative dividends on Series A preferred stock | (36,685) | (36,685) | (108,858) | (53,831) |
Net (loss) income attributable to common stockholders | $ (3,042,089) | $ 2,799,810 | $ (7,954,725) | $ (16,034,214) |
Basic net (loss) income per share attributable to common stockholders | $ (0.08) | $ 0.15 | $ (0.22) | $ (1.32) |
Diluted net (loss) income per share attributable to common stockholders | $ (0.08) | $ 0.14 | $ (0.22) | $ (1.32) |
Basic weighted average number of shares outstanding | 36,659,685 | 18,891,206 | 35,873,780 | 12,160,048 |
Diluted weighted average number of shares outstanding | 36,659,685 | 19,357,370 | 35,873,780 | 12,160,048 |
Grant revenue | ||||
Total revenue | $ 225,128 | $ 324,521 | $ 400,789 | $ 351,428 |
Milestone revenue | ||||
Total revenue | $ 41,846 | $ 295,738 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Members' and Stockholders' Equity (Deficit) - USD ($) | Series A preferred stockPreferred Stock | Series A warrantsCommon Stock | Series A warrantsAdditional Paid-in Capital | Series B WarrantsCommon Stock | Series B WarrantsAdditional Paid-in Capital | Preferred stock units | Common stock units | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Total |
Beginning Balance at Dec. 31, 2019 | $ 1,624,228 | $ 74,667 | $ (3,075,113) | $ (1,376,218) | |||||||
Beginning Balance (in shares) at Dec. 31, 2019 | 1,624,228 | 10,000 | |||||||||
Increase (decrease) in stockholders' equity (deficit) | |||||||||||
Issuance of common stock for acquisition of BioPharmX | $ 1,367 | $ 8,366,665 | 8,368,032 | ||||||||
Issuance of common stock for acquisition of BioPharmX (in shares) | 1,367,326 | ||||||||||
Issuance of common stock and warrants, net of costs | $ 4,186 | 17,495,814 | 17,500,000 | ||||||||
Issuance of common stock and warrants, net of costs (in shares) | 4,185,981 | ||||||||||
Issuance of Series A warrants | (16,511,634) | (16,511,634) | |||||||||
Bridge Loan converted to equity | 5,000,000 | 5,000,000 | |||||||||
Reclassification of bridge warrant | 3,423,204 | 3,423,204 | |||||||||
Non-cash contribution from TardiMed | $ 142,392 | 142,392 | |||||||||
Non-cash contribution from TardiMed (in shares) | 142,392 | ||||||||||
Accrued preferred unit dividend | $ 52,669 | (52,669) | |||||||||
Accrued preferred unit dividend (in shares) | 52,669 | ||||||||||
Conversion of common units to common stock pursuant to BioPharmX acquisition | $ (74,667) | $ 6,296 | 68,371 | 74,667 | |||||||
Conversion of common units to common stock pursuant to BioPharmX acquisition (in shares) | (10,000) | 6,295,724 | |||||||||
Conversion of preferred units to Series A preferred stock pursuant to BioPharmX acquisition | $ 1,819,289 | $ (1,819,289) | (1,819,289) | ||||||||
Conversion of preferred units to Series A preferred stock pursuant to BioPharmX acquisition (in shares) | 1,819 | (1,819,289) | |||||||||
Stock-based compensation | 157,187 | 157,187 | |||||||||
Net income (loss) | (15,927,714) | (15,927,714) | |||||||||
Ending Balance at Sep. 30, 2020 | $ 1,819,289 | $ 11,849 | 17,999,607 | (19,055,496) | (1,044,040) | ||||||
Ending Balance (in shares) at Sep. 30, 2020 | 1,819 | 11,849,031 | |||||||||
Beginning Balance at Jun. 30, 2020 | $ 1,836,435 | $ 11,843 | 17,904,088 | (21,909,137) | (3,993,206) | ||||||
Beginning Balance (in shares) at Jun. 30, 2020 | 1,819 | 11,843,258 | |||||||||
Increase (decrease) in stockholders' equity (deficit) | |||||||||||
Issuance of common stock and warrants, net of costs | $ 6 | (6) | |||||||||
Issuance of common stock and warrants, net of costs (in shares) | 5,773 | ||||||||||
Accrued dividend Series A preferred stock | $ (17,146) | 17,146 | 17,146 | ||||||||
Stock-based compensation | 95,525 | 95,525 | |||||||||
Net income (loss) | 2,836,495 | 2,836,495 | |||||||||
Ending Balance at Sep. 30, 2020 | $ 1,819,289 | $ 11,849 | 17,999,607 | (19,055,496) | (1,044,040) | ||||||
Ending Balance (in shares) at Sep. 30, 2020 | 1,819 | 11,849,031 | |||||||||
Beginning Balance at Dec. 31, 2020 | $ 1,909,805 | $ 27,132 | 25,826,295 | (18,245,396) | 7,608,031 | ||||||
Beginning Balance (in shares) at Dec. 31, 2020 | 1,819 | 27,132,420 | |||||||||
Increase (decrease) in stockholders' equity (deficit) | |||||||||||
Accrued dividend Series A preferred stock | $ 108,858 | (108,858) | (108,858) | ||||||||
Exercise of warrants | $ 2,060 | $ (2,060) | $ 7,468 | $ (7,468) | |||||||
Exercise of warrants ( in shares) | 2,059,613 | 7,467,652 | |||||||||
Stock-based compensation | 295,684 | 295,684 | |||||||||
Net income (loss) | (7,845,867) | (7,845,867) | |||||||||
Ending Balance at Sep. 30, 2021 | $ 2,018,663 | $ 36,660 | 26,003,593 | (26,091,263) | (51,010) | ||||||
Ending Balance (in shares) at Sep. 30, 2021 | 1,819 | 36,659,685 | |||||||||
Beginning Balance at Jun. 30, 2021 | $ 1,981,978 | $ 36,660 | 25,852,542 | (23,085,859) | 2,803,343 | ||||||
Beginning Balance (in shares) at Jun. 30, 2021 | 1,819 | 36,659,685 | |||||||||
Increase (decrease) in stockholders' equity (deficit) | |||||||||||
Accrued dividend Series A preferred stock | $ 36,685 | (36,685) | (36,685) | ||||||||
Stock-based compensation | 187,736 | 187,736 | |||||||||
Net income (loss) | (3,005,404) | (3,005,404) | |||||||||
Ending Balance at Sep. 30, 2021 | $ 2,018,663 | $ 36,660 | $ 26,003,593 | $ (26,091,263) | $ (51,010) | ||||||
Ending Balance (in shares) at Sep. 30, 2021 | 1,819 | 36,659,685 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Members' and Stockholders' Equity (Deficit) (Parenthetical) | May 18, 2020$ / shares |
Preferred Stock | |
Conversion reverse stock split ratio | 0.001 |
Merger Agreement | |
Common stock, par value (in dollars per share) | $ 0.001 |
Conversion reverse stock split ratio | 0.0833 |
Timber Pharmaceuticals, Inc | Common Stock | |
Common stock, par value (in dollars per share) | $ 0.001 |
Timber Pharmaceuticals, Inc | Merger Agreement | Common Stock | |
Stock exchange ratio | 629.57 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows - USD ($) | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Cash flows from operating activities | ||
Net loss | $ (7,845,867) | $ (15,927,714) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Research and development-licenses acquired | 12,371,332 | |
Non-cash contribution from TardiMed | 142,392 | |
Stock-based compensation | 295,684 | 157,187 |
Change in fair value of warrant liability | (5,607,293) | |
Change in fair value of investment in BioPharmX | (559,805) | |
Amortization of loan discount | (775,000) | |
Amortization of debt discount | 4,232,718 | |
Amortization of right of use assets | 197,339 | 65,677 |
Depreciation | 791 | |
Accrued interest on BioPharmX loan | (41,655) | |
Accrued interest on bridge notes | 183,333 | |
Changes in assets and liabilities: | ||
Other current assets | 39,090 | (218,509) |
Deposits | (13,000) | |
Accounts payable | 647,241 | (545,480) |
Accrued expenses | (108,796) | (17,537) |
Lease liability | (186,236) | (61,531) |
Net cash used in operating activities | (6,973,754) | (6,601,885) |
Cash flows from investing activities | ||
Cash acquired with acquisition of BioPharmX | 340,786 | |
Loan to BioPharmX | (2,250,000) | |
Purchase of property and equipment | (17,803) | |
Purchase of research and development licenses - AFT Pharmaceuticals Limited | (750,000) | |
Net cash used in investing activities | (17,803) | (2,659,214) |
Cash flows from financing activities | ||
Proceeds from PPP loan | 37,772 | |
Proceeds from the issuance of common stock and warrants, net of issuance costs | 17,500,000 | |
Proceeds from bridge notes payable | 3,700,000 | |
Net cash provided by financing activities | 21,237,772 | |
Net (decrease) increase in cash | (6,991,557) | 11,976,673 |
Cash, beginning of period | 10,348,693 | 57,073 |
Cash, end of period | 3,357,136 | 12,033,746 |
Supplemental disclosure of cash flow information: | ||
Cash paid for interest | 183,333 | |
Non cash investing and financing activities: | ||
Issuance of common stock for acquisition of BioPharmX | 8,368,032 | |
Conversion of preferred units to Series A preferred stock pursuant to BioPharmX acquisition | 1,819,289 | |
Conversion of common units to common stock pursuant to BioPharmX acquisition | 74,667 | |
Bridge loan converted to equity | 5,000,000 | |
Reclassification of bridge warrant | 3,423,204 | |
Series A liability classified warrants | $ 16,511,634 | |
Accrued Series A preferred stock dividend | 108,858 | |
Series A warrants | ||
Non cash investing and financing activities: | ||
Cashless exercise of warrants | 2,060 | |
Series B Warrants | ||
Non cash investing and financing activities: | ||
Cashless exercise of warrants | $ 7,468 |
Organization and description of
Organization and description of business operations | 9 Months Ended |
Sep. 30, 2021 | |
Organization and description of business operations | |
Organization and description of business operations | Note 1. Organization and description of business operations Timber Pharmaceuticals, Inc., formerly known as BioPharmX Corporation (together with its subsidiaries Timber Pharmaceuticals Australia Pty Ltd., BioPharmX Inc. and Timber Pharmaceuticals LLC, the “Company” or “Timber”) is incorporated under the laws of the state of Delaware. Timber was founded in 2019 to develop treatments for unmet needs in medical dermatology. Timber has a particular focus on rare diseases or conditions of the skin for which there are no current treatments. Timber is initially targeting multiple indications in rare/orphan dermatology with no approved treatments. These consolidated financial statements should be read in conjunction with the audited consolidated financial statements and accompanying notes in Item 8 of Part II, “ Financial Statements and Supplementary Data Merger Agreement On May 18, 2020, BioPharmX Corporation (“BioPharmX”) completed its business combination with Timber Pharmaceuticals LLC, a Delaware limited liability company (“Timber Sub”), in accordance with the terms of the Agreement and Plan of Merger and Reorganization, dated as of January 28, 2020 (the “Merger Agreement”), by and among BioPharmX, Timber Sub and BITI Merger, Inc., a Delaware corporation and wholly-owned subsidiary of the Company (“Merger Sub”), as amended by Amendment No. 1 thereto made and entered into as of March 24, 2020 (the “First Amendment”) and Amendment No. 2 thereto made and entered into as of April 27, 2020 (the “Second Amendment”) (the Merger Agreement, as amended by the First Amendment and the Second Amendment, the “Amended Merger Agreement”), pursuant to which Merger Sub merged with and into Timber Sub, with Timber Sub surviving as a wholly-owned subsidiary of the Company (the “Merger”). In connection with, and immediately prior to the completion of, the Merger, BioPharmX effected a reverse stock split of the Company’s common stock, par value $0.001 per share (the “Common Stock”), at a ratio of 1 Under the terms of the Amended Merger Agreement, BioPharmX issued shares of Common Stock to the holders of common units of Timber Sub. Immediately after the Merger, there were approximately 11,849,031 shares of Common Stock outstanding (after the Reverse Stock Split). Pursuant to the terms of the Amended Merger Agreement, the former holders of common units of Timber Sub (including the Investors, as defined below, but excluding Value Appreciation Rights of Timber Sub (“VARs”), as defined below) owned in the aggregate approximately 88.5% of the outstanding Common Stock, with the Company’s stockholders immediately prior to the Merger owning approximately 11.5% of the outstanding Common Stock. The number of shares of Common Stock issued to the holders of common units of Timber Sub for each common unit of Timber Sub outstanding immediately prior to the Merger was calculated using an exchange ratio of approximately 629.57 shares of Common Stock for each Timber Sub unit. In addition, the 584 VARs that were outstanding immediately prior to Merger became denoted and payable in 367,670 shares of Common Stock at the Effective Time of the Merger (the “Effective Time”). Further, the holder of the 1,819,289 preferred units of Timber Sub outstanding immediately prior to the Merger received 1,819 shares of the newly created convertible Series A preferred stock at the Effective Time. Securities Purchase Agreement On May 18, 2020, Timber and Timber Sub completed a private placement transaction (the “Pre-Merger Financing”) with the Investors pursuant to the Securities Purchase Agreement for an aggregate purchase price of approximately $25.0 million (comprised of (i) approximately $5 million credit with respect to the senior secured notes issued in connection with the bridge loan that certain of the Investors made to Timber Sub at the time of the execution of the Merger Agreement and (ii) approximately $20 million in cash from the Investors). Liquidity and Capital Resources The Company has no product revenues, incurred operating losses since inception, and expects to continue to incur significant operating losses for the foreseeable future and may never become profitable. The Company had an accumulated deficit of approximately $26.1 million at September 30, 2021, a net loss of approximately $7.8 million, and approximately $7.0 million of net cash used in operating activities for the nine months ended September 30, 2021. As of September 30, 2021 the Company had cash of approximately $3.4 million. Going Concern The Company has evaluated whether there are any conditions and events, considered in the aggregate, that raise substantial doubt about its ability to continue as a going concern within one year beyond the filing of this Quarterly Report on Form 10-Q. Based on such evaluation and the Company's current plans, which are subject to change, management believes that the Company's existing cash and cash equivalents as of September 30, 2021 were sufficient only to satisfy our operating cash needs through the end of 2021. The Company received net proceeds of approximately $15.6 million (see Note 10) from an underwritten public offering subsequent to September 30, 2021 and is currently evaluating the impact of the receipt of such funds on the length of time we will be able to satisfy our operating cash needs, but still are potentially not sufficient to satisfy our operating cash needs for the twelve months from the filing of this Quarterly Report on Form 10-Q. The accompanying unaudited condensed consolidated financial statements have been prepared assuming the Company will continue to operate as a going concern, which contemplates the realization of assets and settlement of liabilities in the normal course of business, and do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result from uncertainty related to its ability to continue as a going concern. The Company’s future liquidity and capital funding requirements will depend on numerous factors, including: ● its ability to raise additional funds to finance its operations, including its ability to access financing that may be unavailable due to contractual limitations under the Securities Purchase Agreement; ● the dilutive effect of the Company's outstanding securities; ● the impact of the COVID-19 pandemic on the Company's operations, including on the Company's clinical development plans and timelines; ● the outcome, costs and timing of clinical trial results for the Company’s current or future product candidates, including the timing, progress, costs and results of its ongoing Phase 2b clinical trial of TMB-002 for the treatment of facial angiofibromas in tuberous sclerosis complex and its anticipated Phase 3 clinical trial of TMB-001 for the treatment of congenital ichthyosis which is expected to commence in the second half of 2022; ● the outcome, timing and cost of meeting regulatory requirements established by the FDA and other comparable foreign regulatory authorities; ● the emergence and effect of competing or complementary products; ● its ability to maintain, expand and defend the scope of its intellectual property portfolio, including the amount and timing of any payments the Company may be required to make, or that it may receive, in connection with the licensing, filing, prosecution, defense and enforcement of any patents or other intellectual property rights; ● the cost and timing of completion of commercial-scale manufacturing activities; ● the terms and timing of any collaborative, licensing or other arrangements that it has or may establish, and the need to satisfy its payment obligations thereunder; ● the cost of establishing sales, marketing and distribution capabilities for its products in regions where it chooses to commercialize its products on its own; ● the initiation, progress, timing and results of the commercialization of its product candidates, if approved for commercial sale; ● the volatility of the price of the Company's common stock; ● acceptance of the Company's products in the Company's industry; ● the accuracy of the Company's estimates regarding expenses and capital requirements; and ● its ability to retain its current employees and the need and ability to hire additional management and scientific and medical personnel. The Company will need to raise substantial additional funds through one or more of the following: issuance of additional debt or equity and/or the completion of a licensing or other commercial transaction for one or more of the Company's product candidates. If the Company is unable to maintain sufficient financial resources, its business, financial condition and results of operations will be materially and adversely affected. This could affect future development and business activities and potential future clinical studies and/or other future ventures. There can be no assurance that the Company will be able to obtain the needed financing on acceptable terms or at all. Additionally, equity or convertible debt financings will likely have a dilutive effect on the holdings of the Company's existing stockholders. The impact of the worldwide spread of a novel strain of coronavirus (“COVID-19”) has been unprecedented and unpredictable. Site activation and patient enrollment have been impacted by the COVID-19 pandemic in the TMB-002 study, especially at our contracted test sites in Eastern Europe. Currently, the Company can confirm that recruitment has been finalized on the TMB-002 Phase 2b trial with a total of 120 consented (108 randomized) patients. |
Significant accounting policies
Significant accounting policies | 9 Months Ended |
Sep. 30, 2021 | |
Significant accounting policies | |
Significant accounting policies | Note 2. Significant accounting policies Basis of presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and pursuant to the instructions to Form 10- Q and Article 8 of Regulation S-X of the SEC. In the opinion of management, the accompanying unaudited condensed financial statements reflect all adjustments, consisting of normal recurring adjustments, considered necessary for a fair presentation of such interim results. The results for the unaudited condensed consolidated statement of operations are not necessarily indicative of results to be expected for the year ending December 31, 2021 or for any future interim period. The unaudited condensed consolidated financial statements do not include all of the information and notes required by U.S. GAAP for complete financial statements. Use of estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. The most significant estimates in the Company’s unaudited condensed consolidated financial statements relate to the valuations of warrants, and equity-based awards and member units. These estimates and assumptions are based on current facts, historical experience and various other factors believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the recording of expenses that are not readily apparent from other sources. Actual results may differ materially and adversely from these estimates. To the extent there are material differences between the estimates and actual results, the Company’s future results of operations will be affected. Loss Per Share Basic net income (loss) per share (“EPS”) of common stock is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding during the period. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the earnings of the entity. To calculate the basic EPS numerator, income available to common stockholders must be computed by deducting both the dividends declared in the period on preferred stock (whether or not paid) and the dividends accumulated for the period on cumulative preferred stock (whether or not declared) from income from continuing operations and also from net income. If there is a loss from continuing operations or a net loss, the amount of the loss shall be increased by those preferred dividends. The outstanding Series A Preferred Stock has cumulative dividends, whether or not declared. Accordingly, the Company reduced the numerator for basic EPS by deducting/(increasing) the amount of cumulative preferred dividend from net income/(loss) in each period presented. The basic and diluted net loss amounts are the same for the three and nine months ended September 30, 2021, and for the nine months ended September 30, 2020, as a result of the net loss and anti-dilutive impact of the potentially dilutive securities. For the three months ended September 30, 2020, the Company recorded net income and therefore, earnings per share was calculated using the treasury stock method. Potentially dilutive shares are determined by applying the treasury stock method to the assumed exercise of outstanding stock options, value appreciation rights, and warrants. Potentially dilutive shares issuable upon conversion of the Series A Preferred Stock are calculated using the if-converted method. The following is a reconciliation of the numerator and denominator of the diluted net income (loss) per share computations for the periods presented below: Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Basic and diluted loss per share: Net (loss) income $ (3,005,404) $ 2,836,495 $ (7,845,867) $ (15,927,714) Accrued dividend on preferred stock units — — — (52,669) Cumulative dividends on Series A preferred stock (36,685) (36,685) (108,858) (53,831) Net (loss) income attributable to common stockholders $ (3,042,089) $ 2,799,810 $ (7,954,725) $ (16,034,214) Basic weighted average number of shares outstanding 36,659,685 18,891,206 35,873,780 12,160,048 Add: Series A convertible preferred stock — 100,775 — — Add: Value appreciation rights — 365,389 — — Diluted weighted average number of shares outstanding 36,659,685 19,357,370 35,873,780 12,160,048 Basic net (loss) income per share attributable to common stockholders $ (0.08) $ 0.15 $ (0.22) $ (1.32) Diluted net (loss) income per share attributable to common stockholders $ (0.08) $ 0.14 $ (0.22) $ (1.32) Securities that could potentially dilute loss per share in the future were not included in the computation of diluted loss per share for the nine months ended September 30, 2021 and 2020, because their inclusion would be anti-dilutive are as follows (unaudited): September 30, 2021 2020 Series A warrants 16,701,824 8,384,764 Bridge warrants 413,751 413,751 Value appreciation rights 367,670 333,044 Options to purchase common stock 2,657,640 232,996 Series A preferred stock 100,753 100,753 Legacy stock options 15,781 97,870 Legacy warrants 213,992 220,030 20,471,411 9,783,208 Recent accounting pronouncements In August 2020, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2020-06, Debt-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity's Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity's Own Equity, which simplifies accounting for convertible instruments by removing major separation models required under current GAAP. The ASU removes certain settlement conditions that are required for equity contracts to qualify for the derivative scope exception and it also simplifies the diluted earnings per share calculation in certain areas. This ASU is effective for annual reporting periods beginning after December 15, 2021, including interim periods within those fiscal years. Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020. This update permits the use of either the modified retrospective or fully retrospective method of transition. The Company is currently evaluating the impact this ASU will have on its condensed consolidated financial statements and related disclosures. In May 2021, the FASB issued ASU 2021 , Earnings Per Share (Topic 260), Debt-Modifications and Extinguishments ( ), Compensation-Stock Compensation (Topic 718), and Derivatives and Hedging-Contracts in Entity’s Own Equity ( ). This ASU reduces diversity in an issuer’s accounting for modifications or exchanges of freestanding equity-classified written call options (for example, warrants) that remain equity classified after modification or exchange. This ASU provides guidance for a modification or an exchange of a freestanding equity-classified written call option that is not within the scope of another Topic. It specifically addresses: (1) how an entity should treat a modification of the terms or conditions or an exchange of a freestanding equity-classified written call option that remains equity classified after modification or exchange; (2) how an entity should measure the effect of a modification or an exchange of a freestanding equity-classified written call option that remains equity classified after modification or exchange; and (3) how an entity should recognize the effect of a modification or an exchange of a freestanding equity-classified written call option that remains equity classified after modification or exchange. This ASU will be effective for all entities for fiscal years beginning after December 15, 2021. An entity should apply the amendments prospectively to modifications or exchanges occurring on or after the effective date of the amendments. Early adoption is permitted, including adoption in an interim period. adoption of ASU 2021-04 is not expe |
Acquisition of BioPharmX
Acquisition of BioPharmX | 9 Months Ended |
Sep. 30, 2021 | |
Acquisition of BioPharmX | |
Acquisition of BioPharmX | Note 3. Acquisition of BioPharmX As described in Note 1, on May 18, 2020, the Company completed its acquisition of BioPharmX in accordance with the terms of the Merger Agreement. The acquisition was accounted for as an asset acquisition/reverse merger. Pursuant to the Merger Agreement, following the Merger, the Timber Sub members, including the investors funding the $20 million investment and the bridge investors, owned approximately 88.5% of the outstanding common stock of BioPharmX, and the BioPharmX stockholders own approximately 11.5% of the outstanding common stock as of the date of the merger. The cost of the BioPharmX acquisition, which represents the consideration transferred to BioPharmX stockholders in the BioPharmX acquisition, of $12.4 million consists of the following: Number of shares of the combined company owned by BioPharmX stockholders 1,367,326 Multiplied by the fair value per share of BioPharmX common stock $ 6.12 Total estimated fair value of common stock 8,368,033 Add: net liabilities acquired (2,833,453) Add: investment in BioPharmX (1,169,846) Total consideration - recorded as research and development acquired $ 12,371,332 The total cost of the BioPharmX acquisition was allocated to the net liabilities acquired as follows: Cash and cash equivalents $ 340,786 Other current assets 2,027 Deposits 114,534 ROU asset 904,370 Accounts payable (610,882) Credit cards 760 Accrued expenses (148,999) Note - short term (2,456,614) Operating lease liability - short term (259,712) Other long term liabilities (73,682) Operating lease liability - long term (646,041) Net liabilities acquired $ (2,833,453) |
Purchases of Assets
Purchases of Assets | 9 Months Ended |
Sep. 30, 2021 | |
Purchases of Assets | |
Purchases of Assets | Note 4. Purchases of Assets Acquisition of Intellectual Property Rights from Patagonia Pharmaceuticals LLC (“Patagonia”) On February 28, 2019, the Company acquired the intellectual property rights to a topical formulation of isotretinoin for the treatment of congenital ichthyosis and identified as TMB-001, formerly PAT-001, from Patagonia (the “TMB-001 Acquisition”). Upon closing of the TMB-001 Acquisition, the Company paid a one-time upfront payment of $50,000 to Patagonia. Patagonia is entitled to up to $27.0 million of cash milestone payments relating to certain regulatory and commercial achievements of TMB-001, with the first being $4.0 million for the initiation of a Phase 3 pivotal trial, as agreed with the FDA. In addition, Patagonia is entitled to net sales earn-out payments ranging from low single digits to mid-double digits. The Company is responsible for all development activities. The potential regulatory and commercial milestones are not yet considered probable, and no milestone payments have been accrued at September 30, 2021 and December 31, 2020. On June 26, 2019 the Company acquired the intellectual property rights to a locally administered formulation of Sitaxsentan for the treatment of cutaneous fibrosis and/or pigmentation disorders, and identified as TMB-003, formerly PAT-S03, from Patagonia (the “TMB-003 Acquisition”). Upon closing of the TMB-003 Acquisition, the Company paid a one-time upfront payment of $20,000 to Patagonia. Patagonia is entitled to up to $10.25 million of cash milestone payments relating to certain regulatory and commercial achievements of TMB-003, with the first being a one-time payment of $250,000 upon the opening of an IND with the FDA. In addition, Patagonia is entitled to net sales earn-out payments ranging from low to mid-single digits. The Company is responsible for all development activities. The potential regulatory and commercial milestones are not yet probable, and no milestone payments have been accrued at September 30, 2021 and December 31, 2020. On January 12, 2021, the Company announced that the U.S. Food and Drug Administration has granted orphan drug designation to TMB-003. Acquisition of License from AFT Pharmaceuticals Limited (“AFT”) On July 5, 2019, the Company and AFT entered into a license agreement which provides the Company with (i) an exclusive license to certain licensed patents, licensed know-how and AFT trademarks to commercialize the Pascomer product in the United States, Canada and Mexico and (2) a co-exclusive license to develop the Pascomer product in this territory. Concurrently, the Company granted to AFT an exclusive license to commercialize the Pascomer product outside of the Company’s territory and co-exclusive sublicense to develop and manufacture the licensed product for commercialization outside of the Company’s territory (the “AFT License Agreement”). The development of the Pascomer product is being conducted pursuant to a written development plan, written by AFT and approved by the joint steering committee, which is reviewed on at least an annual basis. AFT shall perform clinical trials of the Pascomer product in the specified territory and shall perform all CMC (chemistry, manufacturing and controls) and related activities to support regulatory approval. The Company is responsible for all expenses incurred by AFT during the term of the AFT License Agreement and shall equally share all costs and expenses with AFT, incurred by AFT for development and marketing work performed in furtherance of regulatory approval and commercialization worldwide, outside of the specified territory. The Company is entitled to receive a significant percentage of the economics (royalties and milestones) in any licensing transaction that AFT executes outside of North America, Australia, New Zealand, and Southeast Asia. In March 2021 the Company announced that its development partner, AFT Pharmaceuticals Limited has signed an exclusive license and supply agreement with Desitin Arzneimittel GmbH (“Desitin”) for Pascomer® (TMB-002 topical rapamycin) for the treatment of facial angiofibromas (FA) associated with Tuberous Sclerosis Complex (TSC) in Europe. The Company received €250,000 related to an upfront milestone payment paid to AFT by Desitin during the quarter ended September 30, 2021 and has recorded approximately $0.3 million in these financial statements. Pursuant to the AFT License Agreement, the Company was obligated to reimburse AFT for previously spent development costs, subject to certain limitations, and to pay a one-time, irrevocable and non-creditable upfront payment to AFT, payable in scheduled installments. The Company paid $0.25 million in October 2019 and the remaining $0.75 million was paid during the year ended December 31, 2020. AFT is entitled to up to $25.5 million of cash milestone payments relating to certain regulatory and commercial achievements of the AFT License. In addition, AFT is entitled to net sales royalties ranging from high single digits to low double digits for the program licensed. The potential regulatory and commercial milestones are not yet considered probable, and no milestone payments have been accrued at September 30, 2021 and December 31, 2020. |
Accrued Expenses
Accrued Expenses | 9 Months Ended |
Sep. 30, 2021 | |
Accrued Expenses | |
Accrued Expenses | Note 5. Accrued Expenses As of September 30, 2021 and December 31, 2020, the Company’s accrued expenses consisted of the following: September 30, December 31, 2021 2020 Research and development $ 40,045 $ 158,911 Professional fees 157,109 142,599 Personnel expenses 462,711 438,722 Other — 28,429 Total $ 659,865 $ 768,661 |
Temporary Equity, and Members'
Temporary Equity, and Members' and Stockholder's Equity (Deficit) | 9 Months Ended |
Sep. 30, 2021 | |
Temporary Equity, and Members' and Stockholder's Equity (Deficit) | |
Temporary Equity, and Members' and Stockholder's Equity (Deficit) | Note 6. Temporary Equity, and Members’ and Stockholder’s Equity (Deficit) The Company entered into a Merger Agreement with BioPharmX and effective May 18, 2020, the Company converted its common and preferred units into shares of common and preferred stock. Common Stock On May 18, 2020, pursuant to the Merger Agreement (see Note 1), 1,367,326 shares of common stock were issued for the acquisition of BioPharmX, with a fair value of approximately $8.4 million or $6.12 per share. On May 18, 2020, pursuant to the Merger Agreement, 4,185,981 shares of common stock were issued to the investors in the $20 million private placement financing (see Note 1), with aggregate net proceeds received totaling $17.5 million) and to settle the $5 million Bridge Notes. Series B Warrants During the nine months ended September 30, 2021, the remaining Series B Warrants outstanding totaling 7,474,033 were exercised on a cashless basis, and the Company issued 7,467,652 shares of its common stock. Shares Weighted Aggregate Underlying Average Intrinsic Options Exercise Price Value Outstanding as of December 31, 2020 7,474,033 $ 0.001 $ 7,474 Exercised (7,474,033) $ 0.001 — Outstanding and exercisable as of September 30, 2021 — $ — $ — Series A Warrants During the nine months ended September 30, 2021, 3,476,390 Series A Warrants were exercised on a cashless basis, and the Company issued 2,059,613 shares of its common stock. The following is a summary of Series A Warrants outstanding as of September 30, 2021: Weighted Average Shares Weighted Remaining Aggregate Underlying Average Contractual Intrinsic Options Exercise Price Term (Years) Value Outstanding as of December 31, 2020 20,178,214 $ 1.16 4.4 $ — Exercised (3,476,390) $ 1.16 — — Outstanding and exercisable as of September 30, 2021 16,701,824 $ 1.16 3.7 $ — Bridge Warrants The following table summarizes the Company's Bridge Warrants for the nine months ended September 30, 2021: Weighted Average Shares Weighted Remaining Aggregate Underlying Average Contractual Intrinsic Options Exercise Price Term (Years) Value Outstanding as of December 31, 2020 413,751 $ 2.24 4.4 $ — Outstanding and exercisable as of September 30, 2021 413,751 $ 2.24 3.6 $ — Redeemable Series A Convertible Preferred Stock In connection with the Merger, on May 18, 2020, the Company filed a Certificate of Designation of Preferences, Rights and Limitations (the “Certificate of Designations”) with the Secretary of State of the State of Delaware designating 2,500 shares of the Company’s previously undesignated preferred stock as Series A Preferred (the “Series A Preferred Stock”), and issued to the holder of 1,819,289 preferred units of Timber Sub outstanding immediately prior to the Merger, 1,819 shares of the newly created Series A Preferred Stock. The shares of Series A Preferred Stock have no voting rights. The holders of the Series A Preferred Stock are entitled to cumulative dividends from and after the date of issuance at a per annum of eight percent ( 8.00% ) of the stated value. Dividends will be payable as and if declared by the Board of Directors of the Company (the “Board”) out of amounts legally available therefore or upon a liquidation or redemption. Each share of Series A Preferred Stock is convertible at any time at the holder’s option into a number of shares of common stock (subject to adjustment for reverse and forward stock splits, stock dividends, stock combinations and other similar transactions as specified in the Certificate of Designations) at a conversion price equal to the stated value of the Series A Preferred Stock of $1,000 (plus any accrued dividends) divided by the conversion price of $18.054 . Holders of the Series A Preferred Stock are entitled to a liquidation preference in the event of any voluntary or involuntary liquidation, dissolution or winding up of the Company. In addition, upon a Change of Control, the Series A Preferred Stock is redeemable for cash at the option of the holders, in whole or in part. As a Change of Control has occurred, the Company’s Series A Preferred Stock is currently redeemable at September 30, 2021 at the option of the holder and has been recorded at the redemption value of $2.0 Series A Preferred Stock Shares Amount Total temporary equity as of December 31, 2020 1,819 $ 1,909,805 Cumulative dividends on Series A Preferred Stock — 108,858 Total temporary equity as of September 30, 2021 1,819 $ 2,018,663 |
Equity-based compensation
Equity-based compensation | 9 Months Ended |
Sep. 30, 2021 | |
Equity-based compensation | |
Equity-based compensation | Note 7. Equity-based compensation On May 18, 2020, the Company’s 2020 Omnibus Equity Incentive Plan (the “2020 Plan”) became effective, and the 2020 Plan reserved a total of 970,833 shares of common stock for issuance. The 2020 Plan provides for options to purchase shares of common stock, stock appreciation rights, restricted stock units, restricted or unrestricted shares of common stock, performance shares, performance units, incentive bonus awards, other stock-based awards and other cash-based awards. Options granted generally vest over a period of three years and have a maximum term of ten years from the date of grant. On April 20, 2021, the Board of Directors of the Company approved an amendment increasing the number of shares available for issuance under the 2020 Plan from 2,056,130 to 4,668,319 , which was approved by the Company's stockholders on July 1, 2021. As of September 30, 2021, 4,668,319 shares of common stock were reserved for issuance under the 2020 Plan. Furthermore, as a result of the Merger, the Company assumed the TardiMed 2019 Equity Incentive Plan (the “2019 Plan”) from Timber Sub. The 2019 Plan permits the granting of incentive units (the “Incentive Units”). The maximum aggregate Incentive Units that may be subject to awards and issued under the Plan is 699,454 . At September 30, 2021 and December 31, 2020, Incentive Units outstanding under the 2019 Plan were 367,670 units for each period comprised of VARs. During the three and nine months ended September 30, 2021 and 2020 equity-based compensation expenses were as follows (unaudited): Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 General and administrative value appreciation right awards $ 8,621 $ 14,165 $ 34,089 $ 59,273 Research and development value appreciation right awards 555 2,266 1,647 (953) General and administrative stock options 21,650 — 21,650 — Research and development stock options 156,910 79,094 238,298 98,867 $ 187,736 $ 95,525 $ 295,684 $ 157,187 Value Appreciation Rights In 2019 the Company granted equity-based awards similar to stock options under the 2019 Plan as VARs. The VARs have an exercise price, a vesting period and an expiration date, in addition to other terms similar to typical equity option grant terms. During the three and nine months ended September 30, 2021 there were no grants or forfeitures of VARs. The following is a summary of VARs outstanding as of September 30, 2021: Weighted Average Weighted Remaining Average Total Intrinsic Contractual Life Number of Units Exercise Price Value (in years) Outstanding as of December 31, 2020 367,670 $ 0.01 $ 269,502 8.4 Outstanding as of September 30, 2021 367,670 $ 0.01 $ 330,903 7.6 Value appreciation right awards vested and exercisable at September 30, 2021 156,134 $ 0.01 $ 140,520 7.6 As of September 30, 2021, the unrecognized compensation costs were approximately $0.1 million, which will be recognized over an estimated weighted-average amortization period of 0.7 years. Stock Options The fair value of stock option grants is estimated on the date of grant using the Black-Scholes option-pricing model. The Company was historically a private company and lacked company-specific historical and implied volatility information. Therefore, it estimates its expected stock volatility based on the historical volatility of a publicly traded set of peer companies. Additionally, due to an insufficient history with respect to stock option activity and post-vesting cancellations, the expected term assumption for employee grants is based on a permitted simplified method, which is based on the vesting period and contractual term for each tranche of awards. The mid-point between the weighted-average vesting term and the expiration date is used as the expected term under this method. The risk-free interest rate is determined by reference to the U.S. Treasury yield curve in effect for time periods approximately equal to the expected term of the award. Expected dividend yield is zero based on the fact that the Company has never paid cash dividends and does not expect to pay any cash dividends in the foreseeable future. The Company granted 2,473,184 options to purchase common stock during the three and nine months ended September 30, 2021. The Company did not grant stock options during the three and nine months ended September 30, 2020. The following was used in determining the fair value of stock options granted during the three and nine months ended September 30, 2021. Three Months Ended and Nine Months Ended September 30, 2021 Expected life 5 7 years Expected volatility 70.6% Risk-free interest rate 0.79%-1.3% Expected dividend yield — During the three and nine months ended September 30, 2021 the Company granted 2,473,184 options to purchase common stock to its executive officers, non-employee directors and employees. The options vest over a period of 2 - 4 years . The following is a summary of the options outstanding as of September 30, 2021: Weighted Average Shares Weighted Remaining Aggregate Underlying Average Contractual Intrinsic Options Exercise Price Term (Years) Value Outstanding as of December 31, 2020 184,456 $ 2.87 9.4 $ — Granted 2,473,184 0.96 9.9 $ 25,925 Outstanding as of September 30, 2021 2,657,640 $ 1.10 9.8 $ 25,925 Exercisable at September 30, 2021 88,685 $ 2.49 8.9 $ — In accordance with the "evergreen" provision in the 2020 Plan, an additional 1,085,297 shares of common stock were automatically made available for issuance on the first day of 2021, which represents 4% of the number of shares of common stock outstanding on December 31, 2020. As of September 30, 2021, the unrecognized compensation costs related to stock options were approximately $1.4 million, which will be recognized over an estimated weighted-average amortization period of 0.6 years. As part of the Merger, the Company assumed the following legacy stock options and warrants: Weighted Shares Average Underlying Weighted Remaining Aggregate Options and Average Contractual Intrinsic Warrants Exercise Price Term (Years) Value Legacy BioPharmX options - December 31, 2020 15,781 $ 75.27 2.3 $ — Legacy BioPharmX options - September 30, 2021 15,781 $ 75.27 1.6 $ — Legacy BioPharmX warrants - December 31, 2020 219,928 $ 164.09 2.5 $ — Expired (5,936) $ 358.78 — — Legacy BioPharmX warrants - September 30, 2021 213,992 $ 87.21 2.0 $ — |
Commitments and contingencies
Commitments and contingencies | 9 Months Ended |
Sep. 30, 2021 | |
Commitments and contingencies | |
Commitments and contingencies | Note 8. Commitments and contingencies Leases On March 10, 2021, the Company entered into a lease agreement with SIG 110 LLC with respect to a 3,127 square foot office space at 110 Allen Road, Suite 401, Basking Ridge, New Jersey. Pursuant to the terms of the lease agreement, the initial term is for twenty-four (24) months expiring on March 10, 2023. The initial base rent is $4,690.50 per month for the first twelve (12) months and $6,514.58 for the remaining twelve (12) months. During the nine months ended September 30, 2021, in connection with the lease, the Company paid a security deposit of $13,000 , which is included in deposits on the accompanying condensed consolidated balance sheet as of September 30, 2021. In connection with the Merger of BioPharmX, the Company acquired a lease and corresponding sublease for the BioPharmX facility in San Jose, California. The sublease is to be used for general office and research laboratory purposes, has an effective date of February 1, 2020, and has a lease term of 4 years which expires on December 30, 2023. The lease expense is significantly reduced by the payments received in connection with the sublease. The components of lease expense were as follows: Three Months Ended Nine Months Ended September 30, 2021 Operating leases: Operating lease cost $ 99,142 $ 284,415 Variable lease cost 24,948 77,099 Operating lease expense $ 124,090 $ 361,514 Lease income - sub lease (106,435) (317,998) Net rent expense $ 17,655 $ 43,516 Other information: Three Months Ended Nine Months Ended September 30, 2021 Operating cash flows - operating leases $ 94,736 $ 273,313 Right-of-use assets obtained in exchange for operating lease liabilities $ — $ 122,809 Weighted-average remaining lease term – operating leases 2.1 2.1 Weighted-average discount rate – operating leases 14.1 % 14.1 % As of September 30, 2021, future minimum payments for the lease are as follows: Operating Leases Remaining Months in Year Ended December 31, 2021 $ 94,735 Year Ended December 31, 2022 406,506 Year Ended December 31, 2023 357,599 Total $ 858,840 Less present value discount (125,160) Operating lease liabilities $ 733,680 Litigation From time to time, the Company is involved in routine litigation that arises in the ordinary course of business. The company is not aware of any pending significant legal proceedings to which the Company is a party, for which management believes the ultimate outcome would have a material adverse effect on the Company’s financial position. |
Related party transactions
Related party transactions | 9 Months Ended |
Sep. 30, 2021 | |
Related party transactions | |
Related party transactions | Note 9. Related party transactions Patagonia Patagonia is a private, family-owned company founded in 2013 to address the medical needs of people with rare and serious dermatological conditions. On February 28, 2019 and June 26, 2019, the Company acquired the TMB-001 and TMB-003 licenses from Patagonia (see Note 4 for the payment terms and more details), respectively. The Chief Operating Officer, Executive Vice-President and Secretary of the Company is also the President of Patagonia. On February 27, 2019, the Company issued 1,000 founder common units to Patagonia for $10. As of December 31, 2019, Patagonia held 1,000 common units which represented 10% of the total voting units outstanding. During the year ended December 31, 2020, the 1,000 common units were converted to 629,572 shares of the Company's common stock in connection with its merger with BioPharmX (See Note 3). As of September 30, 2021 and December 31, 2020, Patagonia owns 45 shares of the Company's common stock. TardiMed The former Chairman of the Board of the Company is a Managing Member of TardiMed. The Chief Operating Officer, Executive Vice President and Secretary and the Chief Financial Officer, Treasurer and Executive Vice President of the Company are partners of TardiMed. As of September 30, 2021, TardiMed holds 3,109,067 shares of common stock, which represents 8.4% of the total voting shares outstanding. During the year ended December 31, 2020, TardiMed contributed an additional $0.1 million in exchange for 142,392 preferred units. In connection with the Merger Agreement, these preferred units and dividends have converted into 1,819 shares of Series A preferred stock. The Company reimbursed TardiMed $80,066 and $364,274 for management fees and reimbursed expenses for the nine month period ended September 30, 2021 and 2020, respectively. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2021 | |
Subsequent Events | |
Subsequent Events | Note 10. Subsequent Events On November 2, 2021, the Company announced it had entered into an underwriting agreement with H.C. Wainwright & Co., LLC, as representative of the several underwriters named in Schedule I thereto (the “Representative”), relating to the public offering, issuance and sale of 21,325,000 shares of its common stock and, to certain investors, pre-funded warrants to purchase 2,112,500 shares of common stock, and accompanying warrants to purchase up to an aggregate of 23,437,500 shares of its common stock. Each share of common stock and pre-funded warrant to purchase one share of common stock was sold together with a warrant to purchase one share of common stock. All of the securities sold in the offering were sold by the Company. The public offering price of each share of common stock and accompanying common warrant was $0.64 and $0.639 for each pre-funded warrant and accompanying common warrant. The pre-funded warrants were immediately exercisable at a price of $0.001 per share of common stock and were exercised in full on November 5, 2021. The warrants are immediately exercisable at a price of $0.70 per share of common stock and expire five years from the date of issuance. H.C. Wainwright & Co., LLC also exercised its over-allotment option, pursuant to the underwriting agreement, to purchase an additional 3,515,625 shares of common stock and 3,515,625 warrants to purchase common stock at the public offering price per share and per warrant less the underwriters’ discounts and commissions. After giving effect to the sale of 3,515,625 additional shares pursuant to the exercise of the option that closed on November 9, 2021, the total number of shares of common stock (or common stock equivalents) sold by the Company in the offering increased to 26,953,125, together with warrants to purchase up to 26,953,125 shares of common stock issued at the closing on November 5, 2021, for total gross proceeds of $17.25 million before deducting underwriting discounts and commissions and other offering expenses, and net proceeds of approximately $15.6 million. As a result of the offering, the exercise price of the Bridge Warrants was adjusted to $0.33 per share. |
Significant accounting polici_2
Significant accounting policies (Policies) | 9 Months Ended |
Sep. 30, 2021 | |
Significant accounting policies | |
Basis of presentation | Basis of presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and pursuant to the instructions to Form 10- Q and Article 8 of Regulation S-X of the SEC. In the opinion of management, the accompanying unaudited condensed financial statements reflect all adjustments, consisting of normal recurring adjustments, considered necessary for a fair presentation of such interim results. The results for the unaudited condensed consolidated statement of operations are not necessarily indicative of results to be expected for the year ending December 31, 2021 or for any future interim period. The unaudited condensed consolidated financial statements do not include all of the information and notes required by U.S. GAAP for complete financial statements. |
Use of estimates | Use of estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. The most significant estimates in the Company’s unaudited condensed consolidated financial statements relate to the valuations of warrants, and equity-based awards and member units. These estimates and assumptions are based on current facts, historical experience and various other factors believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the recording of expenses that are not readily apparent from other sources. Actual results may differ materially and adversely from these estimates. To the extent there are material differences between the estimates and actual results, the Company’s future results of operations will be affected. |
Loss Per Share | Loss Per Share Basic net income (loss) per share (“EPS”) of common stock is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding during the period. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the earnings of the entity. To calculate the basic EPS numerator, income available to common stockholders must be computed by deducting both the dividends declared in the period on preferred stock (whether or not paid) and the dividends accumulated for the period on cumulative preferred stock (whether or not declared) from income from continuing operations and also from net income. If there is a loss from continuing operations or a net loss, the amount of the loss shall be increased by those preferred dividends. The outstanding Series A Preferred Stock has cumulative dividends, whether or not declared. Accordingly, the Company reduced the numerator for basic EPS by deducting/(increasing) the amount of cumulative preferred dividend from net income/(loss) in each period presented. The basic and diluted net loss amounts are the same for the three and nine months ended September 30, 2021, and for the nine months ended September 30, 2020, as a result of the net loss and anti-dilutive impact of the potentially dilutive securities. For the three months ended September 30, 2020, the Company recorded net income and therefore, earnings per share was calculated using the treasury stock method. Potentially dilutive shares are determined by applying the treasury stock method to the assumed exercise of outstanding stock options, value appreciation rights, and warrants. Potentially dilutive shares issuable upon conversion of the Series A Preferred Stock are calculated using the if-converted method. The following is a reconciliation of the numerator and denominator of the diluted net income (loss) per share computations for the periods presented below: Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Basic and diluted loss per share: Net (loss) income $ (3,005,404) $ 2,836,495 $ (7,845,867) $ (15,927,714) Accrued dividend on preferred stock units — — — (52,669) Cumulative dividends on Series A preferred stock (36,685) (36,685) (108,858) (53,831) Net (loss) income attributable to common stockholders $ (3,042,089) $ 2,799,810 $ (7,954,725) $ (16,034,214) Basic weighted average number of shares outstanding 36,659,685 18,891,206 35,873,780 12,160,048 Add: Series A convertible preferred stock — 100,775 — — Add: Value appreciation rights — 365,389 — — Diluted weighted average number of shares outstanding 36,659,685 19,357,370 35,873,780 12,160,048 Basic net (loss) income per share attributable to common stockholders $ (0.08) $ 0.15 $ (0.22) $ (1.32) Diluted net (loss) income per share attributable to common stockholders $ (0.08) $ 0.14 $ (0.22) $ (1.32) Securities that could potentially dilute loss per share in the future were not included in the computation of diluted loss per share for the nine months ended September 30, 2021 and 2020, because their inclusion would be anti-dilutive are as follows (unaudited): September 30, 2021 2020 Series A warrants 16,701,824 8,384,764 Bridge warrants 413,751 413,751 Value appreciation rights 367,670 333,044 Options to purchase common stock 2,657,640 232,996 Series A preferred stock 100,753 100,753 Legacy stock options 15,781 97,870 Legacy warrants 213,992 220,030 20,471,411 9,783,208 |
Recent accounting pronouncements | Recent accounting pronouncements In August 2020, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2020-06, Debt-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity's Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity's Own Equity, which simplifies accounting for convertible instruments by removing major separation models required under current GAAP. The ASU removes certain settlement conditions that are required for equity contracts to qualify for the derivative scope exception and it also simplifies the diluted earnings per share calculation in certain areas. This ASU is effective for annual reporting periods beginning after December 15, 2021, including interim periods within those fiscal years. Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020. This update permits the use of either the modified retrospective or fully retrospective method of transition. The Company is currently evaluating the impact this ASU will have on its condensed consolidated financial statements and related disclosures. In May 2021, the FASB issued ASU 2021 , Earnings Per Share (Topic 260), Debt-Modifications and Extinguishments ( ), Compensation-Stock Compensation (Topic 718), and Derivatives and Hedging-Contracts in Entity’s Own Equity ( ). This ASU reduces diversity in an issuer’s accounting for modifications or exchanges of freestanding equity-classified written call options (for example, warrants) that remain equity classified after modification or exchange. This ASU provides guidance for a modification or an exchange of a freestanding equity-classified written call option that is not within the scope of another Topic. It specifically addresses: (1) how an entity should treat a modification of the terms or conditions or an exchange of a freestanding equity-classified written call option that remains equity classified after modification or exchange; (2) how an entity should measure the effect of a modification or an exchange of a freestanding equity-classified written call option that remains equity classified after modification or exchange; and (3) how an entity should recognize the effect of a modification or an exchange of a freestanding equity-classified written call option that remains equity classified after modification or exchange. This ASU will be effective for all entities for fiscal years beginning after December 15, 2021. An entity should apply the amendments prospectively to modifications or exchanges occurring on or after the effective date of the amendments. Early adoption is permitted, including adoption in an interim period. adoption of ASU 2021-04 is not expe |
Significant accounting polici_3
Significant accounting policies (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Significant accounting policies | |
Summary of reconciliation of numerator and denominator of the diluted net loss per share | Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Basic and diluted loss per share: Net (loss) income $ (3,005,404) $ 2,836,495 $ (7,845,867) $ (15,927,714) Accrued dividend on preferred stock units — — — (52,669) Cumulative dividends on Series A preferred stock (36,685) (36,685) (108,858) (53,831) Net (loss) income attributable to common stockholders $ (3,042,089) $ 2,799,810 $ (7,954,725) $ (16,034,214) Basic weighted average number of shares outstanding 36,659,685 18,891,206 35,873,780 12,160,048 Add: Series A convertible preferred stock — 100,775 — — Add: Value appreciation rights — 365,389 — — Diluted weighted average number of shares outstanding 36,659,685 19,357,370 35,873,780 12,160,048 Basic net (loss) income per share attributable to common stockholders $ (0.08) $ 0.15 $ (0.22) $ (1.32) Diluted net (loss) income per share attributable to common stockholders $ (0.08) $ 0.14 $ (0.22) $ (1.32) |
Schedule of anti dilutive securities excluded in the computation of diluted loss per share | September 30, 2021 2020 Series A warrants 16,701,824 8,384,764 Bridge warrants 413,751 413,751 Value appreciation rights 367,670 333,044 Options to purchase common stock 2,657,640 232,996 Series A preferred stock 100,753 100,753 Legacy stock options 15,781 97,870 Legacy warrants 213,992 220,030 20,471,411 9,783,208 |
Acquisition of BioPharmX (Table
Acquisition of BioPharmX (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Acquisition of BioPharmX | |
Schedule of total consideration | Number of shares of the combined company owned by BioPharmX stockholders 1,367,326 Multiplied by the fair value per share of BioPharmX common stock $ 6.12 Total estimated fair value of common stock 8,368,033 Add: net liabilities acquired (2,833,453) Add: investment in BioPharmX (1,169,846) Total consideration - recorded as research and development acquired $ 12,371,332 |
Schedule of total cost of the BioPharmX acquisition | Cash and cash equivalents $ 340,786 Other current assets 2,027 Deposits 114,534 ROU asset 904,370 Accounts payable (610,882) Credit cards 760 Accrued expenses (148,999) Note - short term (2,456,614) Operating lease liability - short term (259,712) Other long term liabilities (73,682) Operating lease liability - long term (646,041) Net liabilities acquired $ (2,833,453) |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Accrued Expenses | |
Schedule of accrued expenses | As of September 30, 2021 and December 31, 2020, the Company’s accrued expenses consisted of the following: September 30, December 31, 2021 2020 Research and development $ 40,045 $ 158,911 Professional fees 157,109 142,599 Personnel expenses 462,711 438,722 Other — 28,429 Total $ 659,865 $ 768,661 |
Temporary Equity, and Members_2
Temporary Equity, and Members' and Stockholder's Equity (Deficit) (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Series A preferred stock | |
STOCKHOLDERS' DEFICIT | |
Summary of stock option plan activity | Series A Preferred Stock Shares Amount Total temporary equity as of December 31, 2020 1,819 $ 1,909,805 Cumulative dividends on Series A Preferred Stock — 108,858 Total temporary equity as of September 30, 2021 1,819 $ 2,018,663 |
Series A warrants | |
STOCKHOLDERS' DEFICIT | |
Schedule of warrants outstanding | Weighted Average Shares Weighted Remaining Aggregate Underlying Average Contractual Intrinsic Options Exercise Price Term (Years) Value Outstanding as of December 31, 2020 20,178,214 $ 1.16 4.4 $ — Exercised (3,476,390) $ 1.16 — — Outstanding and exercisable as of September 30, 2021 16,701,824 $ 1.16 3.7 $ — |
Series B Warrants | |
STOCKHOLDERS' DEFICIT | |
Schedule of warrants outstanding | Shares Weighted Aggregate Underlying Average Intrinsic Options Exercise Price Value Outstanding as of December 31, 2020 7,474,033 $ 0.001 $ 7,474 Exercised (7,474,033) $ 0.001 — Outstanding and exercisable as of September 30, 2021 — $ — $ — |
Bridge warrants | |
STOCKHOLDERS' DEFICIT | |
Schedule of warrants outstanding | Weighted Average Shares Weighted Remaining Aggregate Underlying Average Contractual Intrinsic Options Exercise Price Term (Years) Value Outstanding as of December 31, 2020 413,751 $ 2.24 4.4 $ — Outstanding and exercisable as of September 30, 2021 413,751 $ 2.24 3.6 $ — |
Equity-based compensation (Tabl
Equity-based compensation (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |
Summary of equity-based compensation expenses | During the three and nine months ended September 30, 2021 and 2020 equity-based compensation expenses were as follows (unaudited): Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 General and administrative value appreciation right awards $ 8,621 $ 14,165 $ 34,089 $ 59,273 Research and development value appreciation right awards 555 2,266 1,647 (953) General and administrative stock options 21,650 — 21,650 — Research and development stock options 156,910 79,094 238,298 98,867 $ 187,736 $ 95,525 $ 295,684 $ 157,187 |
Summary of VARs issued and outstanding | During the three and nine months ended September 30, 2021 there were no grants or forfeitures of VARs. The following is a summary of VARs outstanding as of September 30, 2021: Weighted Average Weighted Remaining Average Total Intrinsic Contractual Life Number of Units Exercise Price Value (in years) Outstanding as of December 31, 2020 367,670 $ 0.01 $ 269,502 8.4 Outstanding as of September 30, 2021 367,670 $ 0.01 $ 330,903 7.6 Value appreciation right awards vested and exercisable at September 30, 2021 156,134 $ 0.01 $ 140,520 7.6 |
Summary of stock options outstanding | Weighted Average Shares Weighted Remaining Aggregate Underlying Average Contractual Intrinsic Options Exercise Price Term (Years) Value Outstanding as of December 31, 2020 184,456 $ 2.87 9.4 $ — Granted 2,473,184 0.96 9.9 $ 25,925 Outstanding as of September 30, 2021 2,657,640 $ 1.10 9.8 $ 25,925 Exercisable at September 30, 2021 88,685 $ 2.49 8.9 $ — |
Summary of valuation assumptions used to determine fair value of stock options granted | Three Months Ended and Nine Months Ended September 30, 2021 Expected life 5 7 years Expected volatility 70.6% Risk-free interest rate 0.79%-1.3% Expected dividend yield — |
Stock options and warrants | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |
Summary of stock options outstanding | Weighted Shares Average Underlying Weighted Remaining Aggregate Options and Average Contractual Intrinsic Warrants Exercise Price Term (Years) Value Legacy BioPharmX options - December 31, 2020 15,781 $ 75.27 2.3 $ — Legacy BioPharmX options - September 30, 2021 15,781 $ 75.27 1.6 $ — Legacy BioPharmX warrants - December 31, 2020 219,928 $ 164.09 2.5 $ — Expired (5,936) $ 358.78 — — Legacy BioPharmX warrants - September 30, 2021 213,992 $ 87.21 2.0 $ — |
Commitments and contingencies (
Commitments and contingencies (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Commitments and contingencies | |
Schedule of components of lease expense | Three Months Ended Nine Months Ended September 30, 2021 Operating leases: Operating lease cost $ 99,142 $ 284,415 Variable lease cost 24,948 77,099 Operating lease expense $ 124,090 $ 361,514 Lease income - sub lease (106,435) (317,998) Net rent expense $ 17,655 $ 43,516 |
Schedule of other Information | Three Months Ended Nine Months Ended September 30, 2021 Operating cash flows - operating leases $ 94,736 $ 273,313 Right-of-use assets obtained in exchange for operating lease liabilities $ — $ 122,809 Weighted-average remaining lease term – operating leases 2.1 2.1 Weighted-average discount rate – operating leases 14.1 % 14.1 % |
Schedule of future minimum payments | Operating Leases Remaining Months in Year Ended December 31, 2021 $ 94,735 Year Ended December 31, 2022 406,506 Year Ended December 31, 2023 357,599 Total $ 858,840 Less present value discount (125,160) Operating lease liabilities $ 733,680 |
Organization and description _2
Organization and description of business operations - Merger Agreement (Details) | May 18, 2020$ / sharesshares | Sep. 30, 2021$ / sharesshares | Dec. 31, 2020$ / sharesshares |
Merger Agreement | |||
Common stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | |
Common shares outstanding | 36,659,685 | 27,132,420 | |
VARs | |||
Merger Agreement | |||
Outstanding at the ending (in shares) | 367,670 | 367,670 | |
Merger Agreement | |||
Merger Agreement | |||
Common stock, par value (in dollars per share) | $ / shares | $ 0.001 | ||
Conversion reverse stock split ratio | 0.0833 | ||
Common shares outstanding | 11,849,031 | ||
Merger Agreement | BioPharmX | |||
Merger Agreement | |||
Outstanding common stock owned | 88.50% | ||
Merger Agreement | Timber Sub | |||
Merger Agreement | |||
Ownership held by stockholders | 11.50% | ||
Common stock issued per unit | 629.57 | ||
Common stock issued for VARs | 367,670 | ||
Preferred units before merger | 1,819,289 | ||
Merger Agreement | Timber Sub | VARs | |||
Merger Agreement | |||
Outstanding at the ending (in shares) | 584 | ||
Merger Agreement | Timber Sub | Series A preferred stock | |||
Merger Agreement | |||
Common stock on conversion of units | 1,819 |
Organization and description _3
Organization and description of business operations - Securities Purchase Agreement (Details) - Securities Purchase Agreement $ in Millions | May 18, 2020USD ($) |
Timber Sub | |
Securities Purchase Agreement | |
Cash proceeds from issuance of common units | $ 20 |
Private Placement | |
Securities Purchase Agreement | |
Aggregate purchase price | 25 |
Private Placement | Bridge Loan | |
Securities Purchase Agreement | |
Aggregate purchase price | $ 5 |
Organization and description _4
Organization and description of business operations - Liquidity and Capital Resources (Details) - USD ($) | Nov. 09, 2021 | Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 |
Liquidity [Line Items] | ||||||
Accumulated deficit | $ (26,091,263) | $ (26,091,263) | $ (18,245,396) | |||
Net income (loss) | (3,005,404) | $ 2,836,495 | (7,845,867) | $ (15,927,714) | ||
Net cash provided by (used in) operating activities | (6,973,754) | (6,601,885) | ||||
Cash | $ 3,357,136 | $ 3,357,136 | $ 10,348,693 | |||
Proceeds from the issuance of common stock and warrants, net of issuance costs | $ 17,500,000 | |||||
Subsequent event | ||||||
Liquidity [Line Items] | ||||||
Proceeds from the issuance of common stock and warrants, net of issuance costs | $ 15,600,000 |
Organization and description _5
Organization and description of business operations - Test Sites (Details) - TMB-002 License | 9 Months Ended |
Sep. 30, 2021item | |
Test Sites [Line Items] | |
Number of consented patients in Phase 2b trial | 120 |
Number of randomized patients in Phase 2b trial | 108 |
Significant Accounting Polici_4
Significant Accounting Policies - Summary of reconciliation of the numerator and denominator of diluted net income (loss) per share (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Basic and diluted (loss) per share: | ||||
Net income (loss) | $ (3,005,404) | $ 2,836,495 | $ (7,845,867) | $ (15,927,714) |
Accrued dividend on preferred stock units | (52,669) | |||
Cumulative dividends on Series A preferred stock | (36,685) | (36,685) | (108,858) | (53,831) |
Net (loss) income attributable to common stockholders | $ (3,042,089) | $ 2,799,810 | $ (7,954,725) | $ (16,034,214) |
Basic weighted average number of shares outstanding | 36,659,685 | 18,891,206 | 35,873,780 | 12,160,048 |
Add: Series A convertible preferred stock | 100,775 | |||
Add: Value appreciation rights | 365,389 | |||
Diluted weighted average number of shares outstanding | 36,659,685 | 19,357,370 | 35,873,780 | 12,160,048 |
Basic net (loss) income per share attributable to common stockholders | $ (0.08) | $ 0.15 | $ (0.22) | $ (1.32) |
Diluted net (loss) income per share attributable to common stockholders | $ (0.08) | $ 0.14 | $ (0.22) | $ (1.32) |
Significant Accounting Polici_5
Significant Accounting Policies - Anti-dilutive loss per share (Details) - shares | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of diluted loss per share | 20,471,411 | 9,783,208 |
Series A warrants | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of diluted loss per share | 16,701,824 | 8,384,764 |
Bridge warrants | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of diluted loss per share | 413,751 | 413,751 |
Variable appreciation rights | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of diluted loss per share | 367,670 | 333,044 |
Options to purchase common stock | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of diluted loss per share | 2,657,640 | 232,996 |
Series A preferred stock | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of diluted loss per share | 100,753 | 100,753 |
Legacy stock options | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of diluted loss per share | 15,781 | 97,870 |
Legacy warrants | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of diluted loss per share | 213,992 | 220,030 |
Acquisition of BioPharmX (Detai
Acquisition of BioPharmX (Details) - Merger Agreement | May 18, 2020USD ($)$ / sharesshares |
Business Acquisition [Line Items] | |
Number of shares of the combined company owned by BioPharmX stockholders | shares | 1,367,326 |
Multiplied by the fair value per share of BioPharmX common stock | $ / shares | $ 6.12 |
Total estimated fair value of common stock | $ 8,368,033 |
Add: net liabilities acquired | (2,833,453) |
Add: investment in BioPharmX | (1,169,846) |
Total consideration - recorded as research and development acquired | $ 12,371,332 |
Acquisition of BioPharmX - Tota
Acquisition of BioPharmX - Total cost (Details) - Merger Agreement | May 18, 2020USD ($) |
Business Acquisition [Line Items] | |
Cash and cash equivalents | $ 340,786 |
Other current assets | 2,027 |
Deposits | 114,534 |
ROU asset | 904,370 |
Accounts payable | (610,882) |
Credit cards | 760 |
Accrued expenses | (148,999) |
Note - short term | (2,456,614) |
Operating lease liability - short term | (259,712) |
Other long term liabilities | (73,682) |
Operating lease liability - long term | (646,041) |
Net liabilities acquired | $ (2,833,453) |
Acquisition of BioPharmX - Addi
Acquisition of BioPharmX - Additional information (Details) - Merger Agreement | May 18, 2020USD ($) |
Business Acquisition [Line Items] | |
Investment received | $ 20,000,000 |
Total consideration | $ 12,371,332 |
BioPharmX | |
Business Acquisition [Line Items] | |
Percentage of voting interests acquired | 88.50% |
Percentage of interest held by BioPharmx | 11.50% |
Purchases of Assets (Details)
Purchases of Assets (Details) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Oct. 31, 2019USD ($) | Sep. 30, 2021USD ($) | Sep. 30, 2021EUR (€) | Sep. 30, 2020USD ($) | Sep. 30, 2021USD ($) | Sep. 30, 2020USD ($) | Dec. 31, 2020USD ($) | |
Finite-Lived Intangible Assets [Line Items] | |||||||
Total revenue | $ 266,974 | $ 324,521 | $ 696,527 | $ 351,428 | |||
Patagonia license agreement | TMB-001 License | |||||||
Finite-Lived Intangible Assets [Line Items] | |||||||
Upfront fee | 50,000 | ||||||
Milestone payments entitled to receive | 27,000,000 | 27,000,000 | |||||
Initial milestone payments entitled to receive | 4,000,000 | 4,000,000 | |||||
Accrued milestone payments | 0 | 0 | $ 0 | ||||
Patagonia license agreement | TMB-003 License | |||||||
Finite-Lived Intangible Assets [Line Items] | |||||||
Upfront fee | 20,000 | ||||||
Milestone payments entitled to receive | 10,250,000 | 10,250,000 | |||||
Initial milestone payments entitled to receive | 250,000 | 250,000 | |||||
Accrued milestone payments | 0 | 0 | 0 | ||||
AFT license agreement | |||||||
Finite-Lived Intangible Assets [Line Items] | |||||||
Milestone payments entitled to receive | 25,500,000 | 25,500,000 | |||||
Accrued milestone payments | 0 | $ 0 | 0 | ||||
Upfront fee paid | $ 250,000 | $ 750,000 | |||||
AFT license agreement | Pascomer | |||||||
Finite-Lived Intangible Assets [Line Items] | |||||||
Upfront milestone payments received | $ 300,000 | € 250,000 |
Accrued Expenses (Details)
Accrued Expenses (Details) - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
Accrued Expenses | ||
Research and development | $ 40,045 | $ 158,911 |
Professional fees | 157,109 | 142,599 |
Personnel expenses | 462,711 | 438,722 |
Other | 28,429 | |
Total | $ 659,865 | $ 768,661 |
Temporary Equity, and Members_3
Temporary Equity, and Members' and Stockholder's Equity (Deficit) - Common Stock (Details) $ / shares in Units, $ in Millions | May 18, 2020USD ($)$ / sharesshares |
Private Placement | |
Common Stock | |
Aggregate consideration | $ 20 |
Aggregate net proceeds | $ 17.5 |
BioPharmX | |
Common Stock | |
Common stock issued on acquisition | shares | 1,367,326 |
Fair value of common stock issued on acquisition | $ 8.4 |
Fair value per share of common stock issued on acquisition | $ / shares | $ 6.12 |
Merger Agreement | Private Placement | |
Common Stock | |
Common stock issued on acquisition | shares | 4,185,981 |
Bridge warrants | |
Common Stock | |
Amount of loan | $ 5 |
Temporary Equity, and Members_4
Temporary Equity, and Members' and Stockholder's Equity (Deficit) - Series A & B Warrants (Details) - USD ($) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
Series A warrants | ||
Class of Stock [Line Items] | ||
Outstanding as of December 31, 2020 | 20,178,214 | |
Exercised | (3,476,390) | |
Outstanding and exercisable as of September 30, 2021 | 16,701,824 | 20,178,214 |
Weighted Average Exercise Price Rollforward | ||
Weighted Average Exercise Price | $ 1.16 | $ 1.16 |
Weighted Average Price, Exercised | $ 1.16 | |
Weighted Average Remaining Contractual Term (Years) rollforward | ||
Weighted average remaining contractual term ( in years) | 3 years 8 months 12 days | 4 years 4 months 24 days |
Number of warrants outstanding | 16,701,824 | 20,178,214 |
Exercise of warrants ( in shares) | 2,059,613 | |
Series B Warrants | ||
Class of Stock [Line Items] | ||
Outstanding as of December 31, 2020 | 7,474,033 | |
Exercised | (7,474,033) | |
Outstanding and exercisable as of September 30, 2021 | 7,474,033 | |
Weighted Average Exercise Price Rollforward | ||
Weighted Average Exercise Price | $ 0.001 | |
Weighted Average Price, Exercised | $ 0.001 | |
Weighted Average Remaining Contractual Term (Years) rollforward | ||
Aggregate Intrinsic Value | $ 7,474 | |
Number of warrants outstanding | 7,474,033 | |
Exercise of warrants ( in shares) | 7,467,652 |
Temporary Equity, and Members_5
Temporary Equity, and Members' and Stockholder's Equity (Deficit) - Bridge Warrants (Details) - Bridge warrants - $ / shares | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
Class of Stock [Line Items] | ||
Shares underlying options | 413,751 | 413,751 |
Weighted Average Exercise Price | $ 2.24 | $ 2.24 |
Weighted average remaining contractual term ( in years) | 3 years 7 months 6 days | 4 years 4 months 24 days |
Temporary Equity, and Members_6
Temporary Equity, and Members' and Stockholder's Equity (Deficit) - Redeemable Series A Convertible Preferred Stock (Details) - USD ($) | May 18, 2020 | Sep. 30, 2021 |
Class of Stock [Line Items] | ||
Beginning balance, Total temporary equity, Amount | $ 1,909,805 | |
Beginning balance, Total temporary equity, Amount | $ 2,018,663 | |
Series A preferred stock | ||
Class of Stock [Line Items] | ||
Preferred stock designated | 2,500 | |
Cumulative dividends percentage | 8.00% | |
Minimum conversion price | $ 1,000 | |
Conversion price | $ 18.054 | |
Beginning balance, Total temporary equity, Shares | 1,819 | |
Ending balance, Total temporary equity, Shares | 1,819 | |
Timber Sub | Series A preferred stock | ||
Class of Stock [Line Items] | ||
Preferred units before merger | 1,819,289 | |
Common stock on conversion of units | 1,819 | |
Preferred Stock Redemption Amount | $ 2,000,000 | |
Beginning balance, Total temporary equity, Shares | 1,819 | |
Ending balance, Total temporary equity, Shares | 1,819 | |
Beginning balance, Total temporary equity, Amount | $ 1,909,805 | |
Cumulative dividends on Series A Preferred Stock, Amount | 108,858 | |
Beginning balance, Total temporary equity, Amount | $ 2,018,663 |
Equity-based compensation (Deta
Equity-based compensation (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share based compensation expense | $ 187,736 | $ 95,525 | $ 295,684 | $ 157,187 |
Employee value appreciation right award | Research and development | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share based compensation expense | 555 | 2,266 | 1,647 | (953) |
Employee value appreciation right award | General and administrative | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share based compensation expense | 8,621 | 14,165 | 34,089 | 59,273 |
Stock Options | Research and development | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share based compensation expense | 156,910 | $ 79,094 | 238,298 | $ 98,867 |
Stock Options | General and administrative | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share based compensation expense | $ 21,650 | $ 21,650 |
Equity-based compensation - Val
Equity-based compensation - Value Appreciation Rights (Details) - VARs - USD ($) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
Number of Units | ||
Outstanding at the beginning (in shares) | 367,670 | |
Outstanding at the ending (in shares) | 367,670 | 367,670 |
Value appreciation right awards vested and expected to vest (in shares) | 0 | |
Value appreciation right awards vested and exercisable (in shares) | 156,134 | |
Weighted Average Exercise Price | ||
Outstanding at the beginning (in dollars per shares) | $ 0.01 | |
Outstanding at the ending (in dollars per shares) | 0.01 | $ 0.01 |
Value appreciation right awards vested and exercisable (in dollars per shares) | $ 0.01 | |
Total Intrinsic Value | ||
Outstanding intrinsic value | $ 269,502 | |
Outstanding intrinsic value | 330,903 | $ 269,502 |
Value appreciation right awards vested and exercisable | $ 140,520 | |
Weighted Average Remaining Contractual Life (in years) | ||
Outstanding (in years) | 7 years 7 months 6 days | 8 years 4 months 24 days |
Value appreciation right awards vested and exercisable (in years) | 7 years 7 months 6 days |
Equity-based compensation - Fai
Equity-based compensation - Fair Value of Stock Options (Details) - Stock Options | 9 Months Ended |
Sep. 30, 2021 | |
Stock-based compensation | |
Expected volatility | 70.60% |
Risk-free interest rate, minimum | 0.79% |
Risk-free interest rate, maximum | 1.30% |
Minimum | |
Stock-based compensation | |
Expected life | 5 years |
Maximum | |
Stock-based compensation | |
Expected life | 7 years |
Equity-based compensation - Sto
Equity-based compensation - Stock Options (Details) - Stock Options - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 | Sep. 30, 2021 | Sep. 30, 2021 |
Shares Underlying Options | ||||
Outstanding at the beginning (in shares) | 184,456 | |||
Granted (in shares) | 2,473,184 | 2,473,184 | ||
Outstanding at the ending (in shares) | 2,657,640 | 184,456 | 2,657,640 | 2,657,640 |
Exercisable at September 30, 2021 (in shares) | 88,685 | 88,685 | 88,685 | |
Weighted Average Exercise Price | ||||
Outstanding at the beginning (in dollars per share) | $ 2.87 | |||
Granted (in dollars per shares) | 0.96 | |||
Outstanding at the ending (in dollars per share) | $ 1.10 | $ 2.87 | $ 1.10 | 1.10 |
Exercisable at September 30, 2021 (in dollars per share) | $ 2.49 | $ 2.49 | $ 2.49 | |
Weighted Average Remaining Contractual Term (Years) | ||||
Outstanding (in years) | 9 years 9 months 18 days | 9 years 4 months 24 days | ||
Granted (in years) | 9 years 10 months 24 days | |||
Exercisable at September 30, 2021 | 8 years 10 months 24 days | |||
Aggregate intrinsic value | $ 25,925 | $ 25,925 | $ 25,925 | |
Aggregate intrinsic value, Granted | $ 25,925 | $ 25,925 | $ 25,925 |
Equity-based compensation - Leg
Equity-based compensation - Legacy Stock Options Warrants (Details) - Stock options and warrants - $ / shares | Sep. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2020 |
Legacy BioPharmXOptions | |||
Shares Underlying Options | |||
Shares Underlying Options and Warrants | 15,781 | 15,781 | 15,781 |
Weighted Average Exercise Price | |||
Weighted Average Exercise Prices | $ 75.27 | $ 75.27 | $ 75.27 |
Weighted Average Remaining Contractual Term (Years) | |||
Weighted Average Remaining Contractual Life (in Years) | 1 year 7 months 6 days | 2 years 3 months 18 days | |
Legacy BioPharmXWarrants | |||
Shares Underlying Options | |||
Shares Underlying Options and Warrants | 213,992 | 219,928 | 219,928 |
Shares Underlying Options and Warrants, Expired | (5,936) | ||
Weighted Average Exercise Price | |||
Weighted Average Exercise Prices | $ 87.21 | $ 164.09 | $ 164.09 |
Weighted Average Exercise Prices, Expired | $ 358.78 | ||
Weighted Average Remaining Contractual Term (Years) | |||
Weighted Average Remaining Contractual Life (in Years) | 2 years | 2 years 6 months |
Equity-based compensation - Add
Equity-based compensation - Additional information (Details) - USD ($) $ in Millions | May 18, 2020 | Sep. 30, 2021 | Sep. 30, 2021 | Dec. 31, 2020 | Jul. 01, 2021 | Apr. 20, 2021 |
Incentive Units | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Incentive units outstanding | 367,670 | 367,670 | 367,670 | |||
VARs | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Incentive units outstanding | 367,670 | 367,670 | 367,670 | |||
Unrecognized compensation cost | $ 0.1 | $ 0.1 | ||||
Estimated weighted-average amortization period | 8 months 12 days | |||||
Stock Options | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Granted (in shares) | 2,473,184 | 2,473,184 | ||||
Unrecognized compensation cost | $ 1.4 | $ 1.4 | ||||
Estimated weighted-average amortization period | 7 months 6 days | |||||
Stock Options | Minimum | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting period | 2 years | |||||
Expected life | 5 years | |||||
Stock Options | Maximum | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting period | 4 years | |||||
Expected life | 7 years | |||||
2020 Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Common stock reserved for future issuance | 970,833 | 4,668,319 | 4,668,319 | 1,085,297 | 4,668,319 | 2,056,130 |
Vesting period | 3 years | |||||
Expiration term | 10 years | |||||
Percentage of common stock reserved for future issuance | 4.00% | |||||
2019 Plan | Incentive Units | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Maximum aggregate Units that may be subject to awards and issued under the Plan | 699,454 |
Commitments and contingencies_2
Commitments and contingencies (Details) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021USD ($) | Sep. 30, 2021USD ($) | Mar. 10, 2021ft² | Feb. 01, 2020 | |
Operating leases: | ||||
Operating lease cost | $ 99,142 | $ 284,415 | ||
Variable lease cost | 24,948 | 77,099 | ||
Operating lease expense | 124,090 | 361,514 | ||
Lease income - sub lease | (106,435) | (317,998) | ||
Net rent expense | 17,655 | 43,516 | ||
Operating cash flows - operating leases | $ 94,736 | 273,313 | ||
Right-of-use assets obtained in exchange for operating lease liabilities | $ 122,809 | |||
Weighted-average remaining lease term - operating leases | 2 years 1 month 6 days | 2 years 1 month 6 days | ||
Weighted-average discount rate - operating leases | 14.10% | 14.10% | ||
Office spare leased | ft² | 3,127 | |||
Lease term | 24 months | 4 years | ||
Security deposit | $ 13,000 | $ 13,000 | ||
First 12 months | ||||
Operating leases: | ||||
Base rent per month | 4,690.50 | |||
Remaining 12 months | ||||
Operating leases: | ||||
Base rent per month | $ 6,514.58 |
Commitments and contingencies -
Commitments and contingencies - Future minimum payments (Details) | Sep. 30, 2021USD ($) |
Future minimum payments | |
Remaining Months in Year Ended December 31, 2021 | $ 94,735 |
Year Ended December 31, 2022 | 406,506 |
Year Ended December 31, 2023 | 357,599 |
Total | 858,840 |
Less present value discount | (125,160) |
Operating lease liabilities | $ 733,680 |
Related party transactions (Det
Related party transactions (Details) - USD ($) | Feb. 27, 2019 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 |
Related party transactions | |||||
Number of founder common units issued | 10 | ||||
Patagonia | |||||
Related party transactions | |||||
Number of common shares on conversion of units | 629,572 | ||||
Percentage of total voting shares outstanding | 10.00% | ||||
Founder common units contribution | $ 1,000 | $ 1,000 | $ 1,000 | ||
Number of founder common units issued | 45 | 45 | |||
TardiMed | |||||
Related party transactions | |||||
Number of common shares on conversion of units | 3,109,067 | ||||
Percentage of total voting shares outstanding | 8.40% | ||||
Founder common units contribution | $ 100,000 | ||||
Number of founder common units issued | 142,392 | ||||
Number of common shares on conversion of preferred units and dividends | 1,819 | ||||
Management fees and reimbursed expenses | $ 80,066 | $ 364,274 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) | Nov. 09, 2021 | Nov. 05, 2021 | Nov. 02, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Dec. 31, 2020 |
Subsequent Event [Line Items] | ||||||
Common shares outstanding | 36,659,685 | 27,132,420 | ||||
Proceeds from the issuance of common stock and warrants, net of issuance costs | $ 17,500,000 | |||||
Subsequent event | ||||||
Subsequent Event [Line Items] | ||||||
Issuance of common stock and warrants, net of costs (in shares) | 21,325,000 | |||||
Common shares outstanding | 26,953,125 | 23,437,500 | ||||
Shares per warrant | 1 | |||||
Share issue price | $ 0.64 | |||||
Initial exercise price | $ 0.33 | |||||
Warrant exercise price | $ 0.70 | |||||
Term of warrants | 5 years | |||||
Proceeds from the issuance of common stock and warrants, gross | $ 17,250,000 | |||||
Proceeds from the issuance of common stock and warrants, net of issuance costs | $ 15,600,000 | |||||
Subsequent event | Maximum | ||||||
Subsequent Event [Line Items] | ||||||
Warrants to purchase shares | 26,953,125 | |||||
Subsequent event | Prefunded warrants | ||||||
Subsequent Event [Line Items] | ||||||
Warrants to purchase shares | 2,112,500 | |||||
Shares per warrant | 1 | |||||
Initial exercise price | $ 0.639 | |||||
Warrant exercise price | $ 0.001 | |||||
Subsequent event | Over-Allotment option | ||||||
Subsequent Event [Line Items] | ||||||
Issuance of common stock and warrants, net of costs (in shares) | 3,515,625 | |||||
Warrants to purchase shares | 3,515,625 |