Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Mar. 16, 2016 | Jun. 30, 2015 | |
Entity Registrant Name | Cerecor Inc. | ||
Entity Central Index Key | 1,534,120 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2015 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Voluntary Filers | No | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Public Float | $ 0 | ||
Entity Common Stock, Shares Outstanding | 8,650,143 | ||
Document Fiscal Year Focus | 2,015 | ||
Document Fiscal Period Focus | FY | ||
Class A Warrant [Member] | |||
Class of Warrant or Right, Number of Securities Called by Each Warrant or Right | 1 | ||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 4.55 | ||
Class B Warrant [Member] | |||
Class of Warrant or Right, Number of Securities Called by Each Warrant or Right | 0.5 | ||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 3.90 |
Balance Sheets
Balance Sheets - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
Current assets: | ||
Cash and cash equivalents | $ 21,161,967 | $ 11,742,349 |
Prepaid expenses and other current assets | 401,550 | 360,307 |
Restricted cash, current portion | 58,832 | 58,333 |
Total current assets | 21,622,349 | 12,160,989 |
Restricted cash, net of current portion | 117,165 | |
Property and equipment, net | 35,216 | 38,740 |
Total assets | 21,657,565 | 12,316,894 |
Current liabilities: | ||
Current portion of long term debt, net of discount | 3,208,074 | 1,905,879 |
Accounts payable | 678,109 | 931,139 |
Accrued expenses and other current liabilities | 1,885,458 | 975,114 |
Warrant liability | 27,606 | 69,684 |
Unit purchase option liability | 50,571 | |
Investor rights obligation | 1,112,000 | |
Total current liabilities | 5,849,818 | 4,993,816 |
Long term debt, net of current portion and discount | 2,353,482 | 5,308,211 |
Other long term liability | 370,538 | |
Total liabilities | 8,573,838 | 10,302,027 |
Convertible preferred stock: | ||
Total convertible preferred stock | 28,345,531 | |
Stockholders equity (deficit): | ||
Common Stock, $0.001 par value; 200,000,000 and 230,000,000 shares authorized at December 31, 2015 and 2014, respectively, 8,650,143 and 649,721 shares issued and outstanding at December 31, 2015 and 2014, respectively | 8,650 | 650 |
Additional paid in capital | 66,638,557 | 16,742,063 |
Accumulated deficit | (53,563,480) | (43,073,377) |
Total stockholders' deficit | 13,083,727 | (26,330,664) |
Total liabilities, convertible preferred stock and stockholders' equity (deficit) | $ 21,657,565 | 12,316,894 |
Series A Convertible preferred stock | ||
Convertible preferred stock: | ||
Total convertible preferred stock | 10,462,885 | |
Series A-1 Convertible preferred stock | ||
Convertible preferred stock: | ||
Total convertible preferred stock | 3,389,331 | |
Series B convertible preferred stock | ||
Convertible preferred stock: | ||
Total convertible preferred stock | $ 14,493,315 |
Balance Sheets (Parenthetical)
Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2015 | Dec. 31, 2014 |
Preferred Stock, Par or Stated Value Per Share | $ 0.001 | |
Preferred Stock, Shares Authorized | 5,000,000 | 0 |
Preferred Stock, Shares Issued | 0 | |
Preferred Stock, Shares Outstanding | 0 | 0 |
Common stock, Par value | $ 0.001 | $ 0.001 |
Common stock, Shares authorized | 200,000,000 | 230,000,000 |
Common stock, Shares issued | 8,650,143 | 649,721 |
Common stock, Shares outstanding | 8,650,143 | 649,721 |
Series A Convertible preferred stock | ||
Convertible preferred stock, Par value | $ 0.001 | |
Convertible preferred stock, Shares authorized | 0 | 31,116,391 |
Convertible preferred stock, Shares issued | 0 | 31,116,391 |
Convertible preferred stock, Shares outstanding | 0 | 31,116,391 |
Series A-1 Convertible preferred stock | ||
Convertible preferred stock, Par value | $ 0.001 | |
Convertible preferred stock, Shares authorized | 0 | 9,074,511 |
Convertible preferred stock, Shares issued | 0 | 9,074,511 |
Convertible preferred stock, Shares outstanding | 0 | 9,074,511 |
Series B convertible preferred stock | ||
Convertible preferred stock, Par value | $ 0.001 | |
Convertible preferred stock, Shares authorized | 0 | 115,000,000 |
Convertible preferred stock, Shares issued | 0 | 58,948,735 |
Convertible preferred stock, Shares outstanding | 0 | 58,948,735 |
Statements of Operations
Statements of Operations - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Operating expenses: | |||
Research and development | $ 6,587,183 | $ 12,240,535 | $ 8,914,084 |
General and administrative | 4,422,764 | 4,875,030 | 4,020,364 |
Loss from operations | (11,009,947) | (17,115,565) | (12,934,448) |
Other income (expense) | |||
Change in fair value of warrant liability, unit purchase option liability and investor rights obligation | 1,313,049 | 2,266,161 | (121,115) |
Interest income (expense), net | (793,205) | (1,206,187) | 10,555 |
Total other income (expense) | 519,844 | 1,059,974 | (110,560) |
Net loss | (10,490,103) | (16,055,591) | (13,045,008) |
Net loss attributable to common stockholders | $ (10,490,103) | $ (3,521,153) | $ (13,126,972) |
Net loss per share of common stock, basic and diluted | $ (4.71) | $ (5.48) | $ (20.72) |
Weighted average shares of Common Stock outstanding, basic and diluted | 2,226,023 | 642,052 | 633,669 |
Statements of Convertible Prefe
Statements of Convertible Preferred Stock and Stockholder's Equity (Deficit) - USD ($) | Common stock | Additional paid in capital | Accumulated deficit | Redeemable Convertible Preferred Stock [Member] | Series A and A-1 Convertible Preferred Stock [Member] | Series A-1 Convertible preferred stock | Series B convertible preferred stock | Total |
Balance at the beginning at Dec. 31, 2012 | $ 19,856,632 | |||||||
Balance at the beginning (in shares) at Dec. 31, 2012 | 31,116,391 | |||||||
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||||||
Issuance of convertible preferred stock | $ 6,567,064 | |||||||
Issuance of stock (in shares) | 9,074,511 | |||||||
Discount for beneficial conversion feature Convertible Preferred Stock | $ (6,567,064) | |||||||
Accretion of Convertible Preferred Stock beneficial conversion feature discount | 1 | |||||||
Balance at the end at Dec. 31, 2013 | $ 19,856,633 | $ 1 | ||||||
Balance at the end (in shares) at Dec. 31, 2013 | 40,190,902 | |||||||
Balance at the beginning at Dec. 31, 2012 | $ 643 | $ 2,591,397 | $ (13,972,778) | $ (11,380,738) | ||||
Balance at the beginning (in shares) at Dec. 31, 2012 | 642,844 | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Discount for beneficial conversion feature | 6,567,064 | 6,567,064 | ||||||
Offering costs paid for issuance of stock | (736,640) | (736,640) | ||||||
Accretion of convertible preferred stock beneficial conversion feature | (1) | (1) | ||||||
Issuance of stock (in shares) | 9,074,511 | |||||||
Stock based compensation | 748,648 | 748,648 | ||||||
Net loss | (13,045,008) | (13,045,008) | ||||||
Balance at the end at Dec. 31, 2013 | $ 643 | 9,170,468 | (27,017,786) | (17,846,675) | ||||
Balance at the end (in shares) at Dec. 31, 2013 | 642,844 | |||||||
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||||||
Issuance of convertible preferred stock, net of issuance costs and investors rights obligation | $ 12,250,999 | |||||||
Issuance of stock (in shares) | 50,017,786 | |||||||
Extinguishment upon Modification of Convertible Preferred Stock and issuance of common stock dividends | $ (6,004,417) | |||||||
Conversion of Convertible Promissory Notes in Exchange for Convertible Preferred Stock | $ 1,405,003 | |||||||
Conversion of Convertible Promissory Notes in Exchange for Convertible Preferred Stock (in shares) | 5,597,618 | |||||||
Conversion of Demand Notes in Exchange for Convertible Preferred Stock, net of Investors Rights Obligation | $ 837,313 | |||||||
Conversion of Demand Notes in Exchange for Convertible Preferred Stock, net of Investors Rights Obligation (in shares) | 3,333,331 | |||||||
Balance at the end at Dec. 31, 2014 | $ 28,345,531 | $ 3,389,331 | $ 14,493,315 | 28,345,531 | ||||
Balance at the end (in shares) at Dec. 31, 2014 | 99,139,637 | 9,074,511 | 58,948,735 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Extinguishment upon modification and issuance of stock dividends | $ 7 | 6,004,604 | 6,004,611 | |||||
Extinguishment upon Modification of Convertible Preferred Stock and issuance of common stock dividends (in shares) | 6,877 | |||||||
Reclassification of common stock warrants from liabilities to equity | 426,303 | 426,303 | ||||||
Issuance of convertible preferred stock | 54,107 | 54,107 | ||||||
Issuance of stock (in shares) | 50,017,786 | |||||||
Issuance of common stock for conversion of preferred stock on closing of IPO | $ 1,405,003 | |||||||
Issuance of common stock for conversion of preferred stock on closing of IPO (in shares) | 5,597,618 | |||||||
Stock based compensation | 1,086,581 | 1,086,581 | ||||||
Net loss | (16,055,591) | (16,055,591) | ||||||
Balance at the end at Dec. 31, 2014 | $ 650 | 16,742,063 | (43,073,377) | (26,330,664) | ||||
Balance at the end (in shares) at Dec. 31, 2014 | 649,721 | |||||||
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||||||
Issuance of stock (in shares) | 4,020,000 | |||||||
Conversion of Convertible Promissory Notes in Exchange for Convertible Preferred Stock | $ 3,980 | 28,340,177 | 28,344,157 | |||||
Conversion of Convertible Promissory Notes in Exchange for Convertible Preferred Stock (in shares) | 3,980,422 | |||||||
Issuance of common stock for conversion of preferred stock upon closing of initial public offering | $ (28,345,531) | |||||||
Issuance of common stock for conversion of preferred stock upon closing of initial public offering, shares | (99,139,637) | |||||||
Balance at the end (in shares) at Dec. 31, 2015 | 0 | 0 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Issuance of securities in IPO, net of offering costs and underwriting discounts, commissions and expenses | $ 4,020 | 21,161,569 | 21,165,589 | |||||
Issuance of stock (in shares) | 4,020,000 | |||||||
Issuance of common stock for conversion of preferred stock on closing of IPO | $ 3,980 | 28,340,177 | 28,344,157 | |||||
Issuance of common stock for conversion of preferred stock on closing of IPO (in shares) | 3,980,422 | |||||||
Stock based compensation | 394,748 | 394,748 | ||||||
Net loss | (10,490,103) | (10,490,103) | ||||||
Balance at the end at Dec. 31, 2015 | $ 8,650 | $ 66,638,557 | $ (53,563,480) | $ 13,083,727 | ||||
Balance at the end (in shares) at Dec. 31, 2015 | 8,650,143 |
Statements of Cash Flows
Statements of Cash Flows - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Operating activities | |||
Net loss | $ (10,490,103) | $ (16,055,591) | $ (13,045,008) |
Adjustments to reconcile net loss to net cash used in operating activities: | |||
Depreciation | 23,508 | 28,943 | 20,032 |
Loss on disposition of assets | 17,806 | ||
Stock-based compensation expense | 394,748 | 1,086,581 | 748,648 |
Write-off of deferred public offering costs | 1,064,106 | ||
Non-cash interest expense | 293,748 | 989,258 | |
Non-cash expense related to issuance of warrants | 25,811 | ||
Change in fair value of warrant liability and Investor Rights Obligation | (1,313,049) | (2,266,161) | 121,115 |
Changes in assets and liabilities: | |||
Prepaid expenses and other assets | (41,243) | 353,973 | (271,004) |
Restricted cash | 116,666 | (498) | (175,000) |
Accounts payable | (268,709) | (708,366) | 818,391 |
Accrued expenses and other liabilities | 1,121,054 | (28,400) | 271,875 |
Net cash used in operating activities | (10,163,380) | (15,518,349) | (11,485,140) |
Investing activities | |||
Purchase of property and equipment | (19,984) | (19,502) | (29,268) |
Net cash used in investing activities | (19,984) | (19,502) | (29,268) |
Financing activities | |||
Proceeds from issuance of convertible promissory notes and demand notes | 2,249,666 | ||
Proceeds from issuance of term loan, net of costs | 7,390,000 | ||
Proceeds from issuance of convertible preferred stock and common stock warrants, net of offering costs | 14,584,307 | 6,115,080 | |
Principal payments on term debt | (1,811,744) | ||
Payment of fractional shares upon conversion of preferred stock to common stock | (1,373) | ||
Proceeds from initial public offering | 23,685,270 | ||
Payment of offering costs of initial public offering | (2,269,171) | (365,253) | (698,853) |
Net cash provided by financing activities | 19,602,982 | 23,858,720 | 5,416,227 |
Increase (decrease) in cash and cash equivalents | 9,419,618 | 8,320,869 | (6,098,181) |
Cash and cash equivalents at beginning of period | 11,742,349 | 3,421,480 | 9,519,661 |
Cash and cash equivalents at end of period | 21,161,967 | 11,742,349 | $ 3,421,480 |
Supplemental disclosures of cash flow information | |||
Cash paid for interest | $ 568,299 | 173,514 | |
Supplemental disclosures of noncash financing activities | |||
Conversion of promissory and demand notes into preferred stock | 2,249,666 | ||
Reclassification of Common Stock warrants from liabilities to equity | 426,303 | ||
Allocation of debt and equity proceeds to Investor Rights Obligation | 2,598,510 | ||
Extinguishment upon modification of Series A and A-1 Convertible Preferred Stock | $ 12,534,438 |
Business
Business | 12 Months Ended |
Dec. 31, 2015 | |
BUSINESS | |
BUSINESS | 1. Business Description of Business and Organization Cerecor Inc. (the “Company” or “Cerecor”) was incorporated on January 31, 2011 in Delaware. The Company is a clinical ‑stage biopharmaceutical company with the goal of becoming a leader in the development of innovative drugs that make a difference in the lives of patients with neurological and psychiatric disorders. The Company’s operations since inception have been limited to organizing and staffing the Company, acquiring rights to and developing certain product candidates and its product platform, business planning and raising capital. Liquidity The Company has incurred recurring operating losses since inception. For the year ended December 31, 2015, the Company incurred a net loss of $10.5 million and generated negative cash flows from operations of $10.2 million . As of December 31, 2015, the Company had an accumulated deficit of $53.6 million . The Company anticipates operating losses to continue for the foreseeable future due to, among other things, costs related to the clinical development of its product candidates, its product platform, its preclinical programs, business development and the development of its administrative organization. In October 2015, the Company completed its initial public offering of units (“IPO”), selling 4,000,000 units at an offering price of $6.50 per share, resulting in gross proceeds of $26.0 million and net proceeds from the offering of approximately $23.6 million, after deducting underwriting discounts, commissions and expenses (see Note 9). The Company will require substantial additional financing to fund its operations and to continue to execute its strategy. To fully execute its business plan, the Company will need to complete certain research and development activities, have positive clinical trial results and obtain marketing approval for its product candidates, which may span many years, and may ultimately be unsuccessful. Any delays in completing these activities or negative clinical trial results could adversely impact the Company. The Company plans to meet its capital requirements primarily through a combination of equity and debt financings, collaborations, strategic alliances and marketing distribution or licensing arrangements and in the longer term, revenue from product sales to the extent its product candidates receive marketing approval and are commercialized. There can be no assurance, however, that the Company will be successful in obtaining financing at the level needed to sustain operations and develop its product candidates or on terms acceptable to the Company, or that the Company will obtain approvals necessary to market its products or achieve profitability or sustainable, positive cash flow. The Company currently believes that its cash and cash equivalents will be sufficient to meet its anticipated cash requirements through at least the next twelve months. |
Significant Accounting Policies
Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2015 | |
SIGNIFICANT ACCOUNTING POLICIES | |
SIGNIFICANT ACCOUNTING POLICIES | 2. Significant Accounting Policies Basis of Presentation The accompanying financial statements have been prepared in conformity with U. S. generally accepted accounting principles (“GAAP”). Any reference in these notes to applicable guidance is meant to refer to the authoritative GAAP as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Updates (“ASU”) of the Financial Accounting Standards Board (“FASB”). 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, liabilities, revenues, expenses, other comprehensive income and related disclosures. On an ongoing basis, management evaluates its estimates, including estimates related to clinical trial accruals, warrant liability and embedded derivative liabilities. The Company bases its estimates on historical experience and other market ‑specific or other relevant assumptions that it believes to be reasonable under the circumstances. Actual results may differ from those estimates or assumptions. Prior to being a public company, the Company utilized estimates and assumptions in determining the fair value of its common stock as an input for determining the grant date fair value of stock option grants. Management used the assistance of a third ‑party valuation firm in estimating the fair value of the common stock. The board of directors determined the estimated fair value of the common stock based on a number of objective and subjective factors, including external market conditions affecting the biotechnology industry sector and the historic prices at which the Company sold shares of its preferred stock. Net Loss Per Share, Basic and Diluted Basic net loss per share of common stock is computed by dividing net loss attributable to common stockholders by the weighted ‑average number of shares of common stock outstanding during the period, excluding the dilutive effects, if any, of preferred stock, the investor rights obligation, warrants on preferred stock and common stock, stock options and unvested restricted stock. Diluted net loss per share of common stock is computed by dividing the net loss attributable to common stockholders by the sum of the weighted ‑average number of shares of common stock outstanding during the period plus the potential dilutive effects of preferred stock, the investor rights obligation, warrants on preferred stock and common stock, stock options and unvested restricted stock outstanding during the period calculated in accordance with the treasury stock method, although these shares and options are excluded if their effect is anti ‑dilutive. In addition, the Company analyzes the potential dilutive effect of the outstanding preferred stock, the investor rights obligation, and warrants on preferred stock and common stock under the “if ‑converted” method when calculating diluted earnings per share, in which it is assumed that the outstanding security converts into common stock at the beginning of the period. Because the impact of these items is generally anti ‑dilutive during periods of net loss, there was no difference between basic and diluted net loss per share of common stock for the years ended December 31, 2015, 2014 and 2013. Cash and Cash Equivalents The Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. The carrying amounts reported in the balance sheets for cash and cash equivalents are valued at cost, which approximates their fair value. Restricted Cash During the third quarter of 2013, the Company entered into a lease for new office space for its principal offices in Baltimore, Maryland. The Company has provided the landlord with a Letter of Credit in the amount of $175,000 as security by the Company of the Company’s obligations under the Lease. The Letter of Credit is supported by funds that are invested in a certificate of deposit. Provided there has been no event of default by the Company, the Company may request that the amount of the Letter of Credit be reduced by one ‑third (approximately $58,000 ) at the end of each of the first three years of the lease term. At the expiration of the third year of the lease term, the Company shall deposit with Landlord the sum of $13,000 as a security deposit. Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk are primarily cash and cash equivalents. The Company maintains a portion of its cash and cash equivalent balances in the form of a money market account with a financial institution that management believes to be creditworthy. The Company has no financial instruments with off ‑balance sheet risk of loss. Debt Issuance Costs The Company may record debt and equity discounts in connection with raising funds through the issuance of convertible notes or equity instruments. These discounts may arise from (i) the receipt of proceeds less than the face value of the convertible notes or equity instruments, (ii) allocation of proceeds to beneficial conversion features and/or (iii) recording derivative liabilities related to embedded features. These costs are amortized over the life of the debt to interest expense utilizing the effective interest method. Property and Equipment Property and equipment consists of computers, office equipment, and furniture and is recorded at cost. Maintenance and repairs that do not improve or extend the lives of the respective assets are expensed to operations as incurred. Property and equipment are depreciated on a straight ‑line basis over their estimated useful lives. The Company uses a life of four years for computers and software, and five years for equipment and furniture . Upon retirement or sale, the cost of the disposed asset and the related accumulated depreciation are removed from the accounts and any resulting gain or loss is recognized. Impairment of Long ‑Lived Assets Long ‑lived assets consist of property and equipment. Long ‑lived assets to be held and used are tested for recoverability whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable. Factors that the Company considers in deciding when to perform an impairment review include significant underperformance of the business in relation to expectations, significant negative industry or economic trends and significant changes or planned changes in the use of the assets. If an impairment review is performed to evaluate a long ‑lived asset or asset group for recoverability, the Company would compare forecasts of undiscounted cash flows expected to result from the use and eventual disposition of the long ‑lived asset or asset group to its carrying value. An impairment loss would be recognized when estimated undiscounted future cash flows expected to result from the use and eventual disposition of an asset or asset group are less than its carrying amount. The impairment loss would be based on the excess of the carrying value of the impaired asset or asset group over its fair value, determined based on discounted cash flows. To date, the Company has not recorded any impairment losses on long ‑lived assets. Research and Development Research and development costs are expensed as incurred. These costs include, but are not limited to, employee ‑related expenses, including salaries, benefits and stock ‑based compensation of research and development personnel; expenses incurred under agreements with contract research organizations and investigative sites that conduct clinical trials and preclinical studies; the cost of acquiring, developing and manufacturing clinical trial materials; other supplies; facilities, depreciation and other expenses, which include direct and allocated expenses for rent, utilities and insurance; and costs associated with preclinical activities and regulatory operations. Costs for certain development activities, such as clinical trials, are recognized based on an evaluation of the progress to completion of specific tasks using data such as patient enrollment, clinical site activations, or information provided to the Company by its vendors, such as clinical research organizations, with respect to their actual costs incurred. Payments for these activities are based on the terms of the individual arrangements, which may differ from the pattern of costs incurred, and are reflected in the financial statements as prepaid or accrued research and development expense, as the case may be. Comprehensive Loss Comprehensive loss is defined as the change in equity of a business enterprise during a period from transactions and other events and circumstances from non ‑owner sources. Comprehensive loss was equal to net loss for all periods presented. Income Taxes The Company accounts for income taxes under the asset and liability method in accordance with ASC 740, Income Taxes (“ASC 740”). Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases using enacted tax rates in effect for the year in which the differences are expected to affect taxable income. The deferred tax asset primarily includes net operating loss and tax credit carryforwards, accrued expenses not currently deductible and the cumulative temporary differences related to certain research and patent costs, which have been charged to expense in the accompanying statements of operations but have been recorded as assets for income tax purposes. The portion of any deferred tax asset for which it is more likely than not that a tax benefit will not be realized must then be offset by recording a valuation allowance. A full valuation allowance has been established against all of the deferred tax assets (see Note 11) as it is more likely than not that these assets will not be realized given the Company’s history of operating losses. The Company recognizes the tax benefit from an uncertain tax position only if it is more likely than not to be sustained upon examination based on the technical merits of the position. The amount for which an exposure exists is measured as the largest amount of benefit determined on a cumulative probability basis that the Company believes is more likely than not to be realized upon ultimate settlement of the position. The Company’s policy is to record interest and penalties on uncertain tax positions as income tax expense. As of December 31, 2015, the Company does not believe any material uncertain tax positions are present. Stock ‑Based Compensation At December 31, 2015, the Company had one stock ‑based compensation plan (see Note 10). The Company applies the provisions of ASC 718, Compensation—Stock Compensation (“ASC 718”), which requires the measurement and recognition of compensation expense for all stock ‑based awards made to employees and non ‑employees, including employee stock options in the statements of operations. For stock options issued to employees and members of the board of directors for their services on the board of directors, the Company estimates the grant date fair value of each option using the Black ‑Scholes option pricing model. The use of the Black ‑Scholes option pricing model requires management to make assumptions with respect to the expected term of the option, the expected volatility of the common stock consistent with the expected life of the option, risk ‑free interest rates, the value of the common stock and expected dividend yields of the common stock. For awards subject to service ‑based vesting conditions, including those with a graded vesting schedule, the Company recognizes stock ‑based compensation expense, net of estimated forfeitures, equal to the grant date fair value of stock options on a straight ‑line basis over the requisite service period, which is generally the vesting term. Forfeitures are required to be estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. For stock options issued to non ‑employees, the Company initially measures the options at their grant date fair values and revalues as the underlying equity instruments vest and are recognized as expense over the earlier of the period ending with the performance commitment date or the date the services are completed in accordance with the provisions of ASC 718 and ASC 505 ‑50, Equity ‑Based Payments to Non ‑Employees (“ASC 505 ‑50”). See Note 10 for a discussion of the assumptions used by the Company in determining the grant date fair value of options granted under the Black ‑Scholes option pricing model, as well as a summary of the stock option activity under the Company’s stock ‑based compensation plan. Clinical Trial Expense Accruals As part of the process of preparing its financial statements, the Company is required to estimate its expenses resulting from its obligations under contracts with vendors, clinical research organizations and consultants and under clinical site agreements in connection with conducting clinical trials. The financial terms of these contracts are subject to negotiations, which vary from contract to contract and may result in payment flows that do not match the periods over which materials or services are provided under such contracts. The Company’s objective is to reflect the appropriate trial expenses in its financial statements by matching those expenses with the period in which services are performed and efforts are expended. The Company accounts for these expenses according to the progress of the trial as measured by subject progression and the timing of various aspects of the trial. The Company determines accrual estimates by taking into account discussion with applicable personnel and outside service providers as to the progress or state of consummation of trials, or the services completed. During the course of a clinical trial, the Company adjusts its clinical expense recognition if actual results differ from its estimates. The Company makes estimates of its accrued expenses as of each balance sheet date based on the facts and circumstances known to it at that time. The Company’s clinical trial accruals are dependent upon the timely and accurate reporting of contract research organizations and other third ‑party vendors. Although the Company does not expect its estimates to be materially different from amounts actually incurred, its understanding of the status and timing of services performed relative to the actual status and timing of services performed may vary and may result in it reporting amounts that are too high or too low for any particular period. For the years ended December 31, 2015 and December 31, 2014, there were no material adjustments to the Company’s prior period estimates of accrued expenses for clinical trials. Segment Information Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision maker, or decision ‑making group, in making decisions on how to allocate resources and assess performance. The Company’s chief operating decision maker is the chief executive officer. The Company and the chief executive officer view the Company’s operations and manage its business as one operating segment. All long ‑lived assets of the Company reside in the United States. Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014 ‑09, Revenue From Contracts With Customers , (“ASU 2014 ‑09”). Pursuant to ASU 2014 ‑09, an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. For a public entity, ASU 2014 ‑09 is effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. Early application is not permitted. The Company has not yet determined the impact of adoption on the financial statements, although, the impact is not expected to be significant given the Company has not historically recognized significant amounts of revenue. In June 2014, the FASB issued ASU No. 2014 ‑10, Development Stage Entities (Topic 915): Elimination of Certain Financial Reporting Requirements, Including an Amendment to Variable Interest Entities Guidance in Topic 810, Consolidation , or Topic 915. The guidance set forth in Topic 915 is intended to reduce the overall cost and complexity associated with financial reporting for development stage entities without reducing the availability of relevant information. The FASB also believes the changes will simplify the consolidation accounting guidance by removing the differential accounting requirements for development stage entities. As a result of these changes, there no longer will be any accounting or reporting differences in generally accepted accounting principles, or GAAP, between development stage entities and other operating entities. For organizations defined as public business entities, the presentation and disclosure requirements in Topic 915 will no longer be required starting with the first annual period beginning after December 15, 2014, including interim periods therein. Early application is permitted for any annual reporting period or interim period for which the entity’s financial statements have not yet been issued (public business entities) or made available for issuance (other entities). The Company early adopted this guidance during the year ended December 31, 2014 and, as a result, inception ‑to ‑date information about the statements of operations, cash flows, and stockholders’ deficit is no longer presented. In August 2014, FASB issued ASU No. 2014 ‑15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern . The amendments in this update will explicitly require a company’s management to assess an entity’s ability to continue as a going concern, and to provide related footnote disclosures in certain circumstances. The new standard will be effective in the first annual period ending after December 15, 2016. Early adoption is permitted. The Company is currently evaluating the potential impact of the adoption of this standard, but believes its adoption will have no impact on its financial position, results of operations or cash flows. In November 2014, the FASB issued ASU No. 2014 ‑16, Determining Whether the Host Contract in a Hybrid Financial Instrument Issued in the Form of a Share is more akin to Debt or to Equity . The amendments in this update clarify how current GAAP should be interpreted in evaluating the economic characteristics and risks of a host contract in a hybrid financial instrument that is issued in the form of a share. Specifically, the amendments clarify that an entity should consider all relevant terms and features—including the embedded derivative feature being evaluated for bifurcation—in evaluating the nature of the host contract. The amendments in this update are effective for public companies for fiscal years and interim periods within those fiscal years, beginning after December 15, 2015 with early adoption permitted. The Company adopted this guidance beginning with the year ended December 31, 2014 and has properly applied it to its hybrid financial instruments. In April 2015, the FASB issued ASU No. 2015 ‑03, Simplifying the Presentation of Debt Issuance Costs. The guidance requires debt issuance costs to be presented in the balance sheet as a direct deduction from the carrying value of the associated debt liability, consistent with the presentation of a debt discount. The standard also aligns the GAAP presentation with International Financial Reporting Standards and will remedy the long ‑standing conflict with the guidance in FASB Concepts Statement No. 6, Elements of Financial Statements, which indicates that debt issuance costs do not meet the definition of an asset, because they provide no future economic benefit. For public companies, the standard is effective for financial statements issued for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. Early adoption is permitted for financial statements that have not been previously issued. The new guidance will be applied on a retrospective basis. The Company is currently evaluating the potential impact of the adoption of this standard, but believes its adoption will have no impact on its financial position, results of operations or cash flows. |
Net Loss Per Share Of Common St
Net Loss Per Share Of Common Stock, Basic And Diluted | 12 Months Ended |
Dec. 31, 2015 | |
NET LOSS PER SHARE OF COMMON STOCK, BASIC AND DILUTED | |
NET LOSS PER SHARE OF COMMON STOCK, BASIC AND DILUTED | 3. Net Loss Per Share of Common Stock, Basic and Diluted The following table sets forth the computation of basic and diluted net loss per share of common stock for the years ended December 31, 2015, 2014 and 2013: Year ended Year ended Year ended December 31, December 31, December 31, Net loss per share, basic and diluted calculation: 2015 2014 2013 Net loss $ $ $ Extinguishment upon modification of Series A and A-1 convertible preferred stock — — Deemed dividend — — Net loss attributable to common stockholders $ $ $ Weighted-average common shares outstanding Net loss per share, basic and diluted $ $ $ The following outstanding securities at December, 31, 2015, 2014 and 2013 have been excluded from the computation of diluted weighted shares outstanding, as they would have been anti ‑dilutive: December 31, December 31, December 31, 2015 2014 2013 Series A convertible preferred stock — Series A-1 convertible preferred stock — Series B convertible preferred stock — — Common stock dividends on Series A-1 convertible preferred stock — — Unvested restricted stock — — Stock options Warrants on common stock Warrants on preferred stock — — Investor rights obligation — — Underwriters' unit purchase option — — |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2015 | |
FAIR VALUE MEASUREMENTS | |
FAIR VALUE MEASUREMENTS | 4. Fair Value Measurements ASC 820, Fair Value Measurements and Disclosures (“ASC 820”), defines fair value as the price that would be received to sell an asset, or paid to transfer a liability, in the principal or most advantageous market in an orderly transaction between market participants on the measurement date. The fair value standard also establishes a three ‑level hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability on the measurement date. The three levels are defined as follows: · Level 1—inputs to the valuation methodology are quoted prices (unadjusted) for an identical asset or liability in an active market. · Level 2—inputs to the valuation methodology include quoted prices for a similar asset or liability in an active market or model ‑derived valuations in which all significant inputs are observable for substantially the full term of the asset or liability. · Level 3—inputs to the valuation methodology are unobservable and significant to the fair value measurement of the asset or liability. At December 31, 2015 and 2014, the Company’s financial instruments included cash and cash equivalents, restricted cash, accounts payable, accrued expenses and other current liabilities, long term debt, the term loan warrant liability, the investor rights obligation and the underwriters’ unit purchase option liability. The carrying amounts reported in the accompanying financial statements for cash and cash equivalents, restricted cash, accounts payable, and accrued expenses and other current liabilities approximate their respective fair values because of the short ‑term nature of these accounts. The estimated fair value of the Company’s debt of $5.7 million as of December 31, 2015 was based on current interest rates for similar types of borrowings and is in Level 2 of the fair value hierarchy. The following table presents, for each of the fair value hierarchy levels required under ASC 820, the Company’s assets and liabilities that are measured at fair value on a recurring basis: December 31, 2015 Fair Value Measurements Using Quoted prices in Significant other Significant active markets for observable unobservable identical assets inputs inputs (Level 1) (Level 2) (Level 3) Assets Investments in money market funds* $ $ — $ — Liabilities Warrant liability $ — $ — $ Unit purchase option liability — $ — $ December 31, 2014 Fair Value Measurements Using Quoted prices in Significant other Significant active markets for observable unobservable identical assets inputs inputs (Level 1) (Level 2) (Level 3) Assets Investments in money market funds* $ $ — $ — Liabilities Investor rights obligation $ — $ — $ Warrant liability — $ — $ * Investments in money market funds are reflected in cash and cash equivalents on the accompanying Balance Sheets. Level 3 Valuation The warrant liability (which relates to warrants to purchase shares of common stock as part of the term loan agreement) is marked ‑to ‑market each reporting period with the change in fair value recorded to other income (expense) in the accompanying statements of operations until the warrants are exercised, expire or other facts and circumstances lead the warrant liability to be reclassified to stockholders’ equity. The fair value of the warrant liability is estimated using a Black ‑Scholes option-pricing model. The significant assumptions used in preparing the option pricing model for valuing the warrant liability as of December 31, 2015, include (i) volatility of 70% , (ii) risk free interest rate of 1.72% , (iii) strike price ($8.40) , (iv) fair value of common stock ($3.35) , and (v) expected life of 4.8 years. The underwriters’ unit purchase option (the “UPO”) was issued to the underwriters of the IPO and provides the underwriters the option to purchase up to a total of 40,000 units. The units underlying the UPO will be, immediately upon exercise, separated into shares of common stock, underwriters’ Class A warrants and underwriters’ Class B warrants (such warrants together referred to as the Underwriters’ Warrants). The Underwriters’ Warrants are warrants to purchase shares of common stock (see Note 9 for additional information on the UPO). The Company classifies the UPO as a liability as it is a freestanding marked-to-market derivative instrument that is precluded from being classified in stockholders’ equity. The UPO liability is marked ‑to ‑market each reporting period with the change in fair value recorded to other income (expense) in the accompanying statements of operations until the UPO is exercised, expire or other facts and circumstances lead the UPO to be reclassified to stockholders’ equity. The fair value of the UPO liability is estimated using a Black-Scholes option-pricing model within a Monte Carlo simulation model framework. The significant assumptions used in preparing the simulation model for the initial valuation of the UPO liability upon the close of the Company’s initial public offering, include (i) volatility range of 65% to 90% , (ii) risk free interest rate range of 0.03% to 1.29% , (iii) unit strike price ($7.48) , (iv) underwriters’ Class A warrant strike price ($5.23) , (v) underwriters’ Class B warrant strike price ($4.49) , (vi) fair value of underlying equity ($4.98) , and (vii) optimal exercise point of immediately prior to the expiration of the underwriters’ Class B warrants, which occurs on April 20, 2017. The significant assumptions used in preparing the simulation model for valuing the UPO as of December 31, 2015, include (i) volatility range of 55% to 85% , (ii) risk free interest rate range of 0.14% to 1.16% , (iii) unit strike price ($7.48) , (iv) underwriters’ Class A warrant strike price ($5.23) , (v) underwriters’ Class B warrant strike price ($4.49) , (vi) fair value of underlying equity ($3.35) , and (vii) optimal exercise point of immediately prior to the expiration of the underwriters’ Class B warrants, which occurs on April 20, 2017. The decreases in volatility and the fair value of underlying equity were the primary drivers of the decrease in fair value of the UPO liability from $209,542 as of the initial valuation upon the closing of the Company’s initial public offering to $50,571 as of December 31, 2015. This $158,971 gain on the change in fair value of the UPO liability was recorded to other income in the accompanying statement of operations. The investor rights obligation expired in October 2015 upon the closing of the Company’s IPO. While outstanding, the investor rights obligation was remeasured at each reporting period and changes in fair value were recorded as a component of other income (expense) in the Company’s statements of operations. The fair value of the investor rights obligation was determined using a valuation model, which considers the probability of achieving certain milestones, the entity’s cost of capital, the estimated period the rights will be outstanding, consideration received for the instrument with the rights, the number of shares to be issued to satisfy the rights, the price of such shares and any changes in the fair value of the underlying instrument. The significant assumptions used in preparing the option pricing model for valuing the Company’s investor rights obligation as of December 31, 2014, include (i) volatility of 60% , (ii) risk free interest rate ranging from 0.05% to 0.63% , (iii) strike price ($8.40) , (iv) fair value of preferred stock ranging from $0.00 to $5.04 , and (v) expected life ranging from 0.5 to 1.75 years. The tables presented below are a summary of changes in the fair value of the Company’s Level 3 valuation for the warrant liability, unit purchase option liability and investor rights obligation for the years ended December 31, 2015 and 2014: Warrant Unit purchase Investor rights liability option liability obligation Total Balance at December 31, 2014 $ $ — $ $ Issuance of unit purchase option — — Expiration of investor rights obligation — — Change in fair value — Balance at December 31, 2015 $ $ $ — $ Warrant Unit purchase Investor rights liability option liability obligation Total Balance at December 31, 2013 $ $ — $ — $ Issuance of warrants with debt and equity financings — — Recording of investor rights obligation at fair value — — Change in fair value — Reclassification of liability to stockholders’ equity — — Balance at December 31, 2014 $ $ — $ $ No other changes in valuation techniques or inputs occurred during the years ended December 31, 2015 and 2014. No transfers of assets between Level 1 and Level 2 of the fair value measurement hierarchy occurred during the years ended December 31, 2015 and 2014. |
Property And Equipment
Property And Equipment | 12 Months Ended |
Dec. 31, 2015 | |
PROPERTY AND EQUIPMENT | |
PROPERTY AND EQUIPMENT | 5. Property and Equipment Property and equipment as of December 31, 2015 and 2014 consisted of the following: December 31, 2015 2014 Furniture and equipment $ $ Computers and software Total property and equipment Less accumulated depreciation Property and equipment, net $ $ Depreciation expense was $23,508 and $28,943 for the years ended December 31, 2015 and December 31, 2014, respectively. |
Accrued Expenses And Other Curr
Accrued Expenses And Other Current Liabilities | 12 Months Ended |
Dec. 31, 2015 | |
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES | |
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES | 6. Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities as of December 31, 2015 and 2014 consisted of the following: December 31, 2015 2014 Compensation and benefits $ $ Research and development expenses General and administrative Accrued interest Total accrued expenses and other current liabilities $ $ |
Asset Acquisition And License A
Asset Acquisition And License Agreements | 12 Months Ended |
Dec. 31, 2015 | |
ASSET ACQUISITION AND LICENSE AGREEMENTS | |
ASSET ACQUISITION AND LICENSE AGREEMENTS | 7. Asset Acquisition and License Agreements Merck CERC-301 License In 2013, the Company entered into an exclusive license agreement with Merck pursuant to which Merck granted the Company rights relating to certain small molecule compounds. In consideration of the license, the Company may be required to make initial payments totaling $1.5 million. Pursuant to the license agreement the Company paid $750,000 and upon achievement of FDA acceptance of Merck pre-clinical data and FDA approval of a Phase 3 clinical trial the Company will pay an additional $750,000 . The initial payment of $750,000 was recorded as research and development expense in the accompanying statements of operations for the year ended December 31, 2013. Additional payments may be due upon achievement of development and regulatory milestones, including first commercial sale. Upon commercialization of an NR2B product, the Company is obligated to pay Merck milestones and royalties on net sales. Lilly CERC-501 License In February 2015, the Company acquired rights to CERC-501, which was previously referred to as OpRA Kappa, through an exclusive, worldwide license from Eli Lilly and Company (or “Lilly”). Pursuant to the license agreement, the Company paid $750,000 to Lilly within 30 days of the execution of the license agreement, which was recorded as research and development expense in the accompanying statements of operations for the year ended December 31, 2015. Upon the Company undertaking a nine -month toxicology study in non-human primates and delivering a final study report, the Company will be required to pay Lilly an additional $250,000 . Additional payments may be due upon achievement of development and regulatory milestones, including the first commercial sale. Upon commercialization, the Company is obligated to pay Lilly milestones and royalties on net sales. For the first KOR product the Company develops, it is required to make milestone payments in an amount not to exceed, in the aggregate, $19 million upon the achievement of various development and regulatory milestones, including first commercial sale. Additionally, the Company will be required to make sales milestone payments in an amount not to exceed $30 million. Upon commercialization of a KOR product, the Company will pay Lilly a tiered royalty percentage on net sales of a KOR product from mid-single digits to low-double digits. The royalty obligation will be on a product by product and country by country basis until the later of (i) the expiration of the last to expire valid patent claim of a patent licensed to the Company under the license agreement covering the KOR product in such country, or (ii) eleven years from the first commercial sale of the KOR product in such country. Merck COMTi License In 2013, the Company entered into a separate exclusive license agreement with Merck pursuant to which Merck granted the Company certain rights in small molecule compounds which are known to inhibit the activity of COMT. In consideration of the license, the Company made a $200,000 upfront payment to Merck. For each COMT product that is developed, the Company is required to pay up to $6.2 million in milestone payments upon achievement of various development and regulatory milestones. Upon commercialization of a COMT product, the Company is required to pay Merck a royalty of a low single digit on net sales. The royalty obligation will be on a product-by-product and country-by-country basis until the later of (i) the expiration of the last to expire valid patent claim of a patent licensed to the Company under the license agreement covering the COMT product in such country, or (ii) ten years from the first commercial sale of the COMT product in such country. |
Debt
Debt | 12 Months Ended |
Dec. 31, 2015 | |
DEBT | |
DEBT | 8. Term Loan In August 2014, the Company received a $7,500,000 secured term loan from a finance company. The loan is secured by a lien on all of the Company’s assets, excluding intellectual property, which was subject to a negative pledge. The loan contains certain additional nonfinancial covenants. In connection with the loan agreement, the Company’s cash and investment accounts are subject to account control agreements with the finance company that give the finance company the right to assume control of the accounts in the event of a loan default. Loan defaults are defined in the loan agreement and include, among others, the finance company’s determination that there is a material adverse change in the Company’s operations. Interest on the loan is at a rate of the greater of 7.95% , or 7.95% plus the prime rate as reported in The Wall Street Journal minus 3.25% . The interest rate effective from loan inception to December 16, 2015 was 7.95% . Effective December 17, 2015, the prime rate as reported by The Wall Street Journal increased 0.25% resulting in an increase to the current interest rate, which is now 8.20% . The loan was interest ‑only for nine months, and is repayable in equal monthly payments of principal and interest of approximately $305,000 over 27 months, which began in June 2015. Debt consisted of the following as of December 31, 2015 and 2014: December 31, December 31, 2015 2014 Term loan $ $ Less: debt discount Term Loan, net of debt discount Less: current portion, net of debt discount Long term debt, net of current portion and debt discount $ $ Interest expense, which includes amortization of a discount and the accrual of a termination fee, was approximately $800,000 and $329,000 for the years ended December 31, 2015 and 2014, respectively, in the accompanying statements of operations. Future principal payments are as follows: Year ending December 31, 2016 $ 2017 $ In connection with the term loan, the Company issued warrants to purchase 625,208 shares of Series B convertible preferred stock at an exercise price of $0.2999 per share that is exercisable for a period ending five years following the Company’s IPO, which is October 2020. Upon the closing of the Company’s IPO, these warrants became warrants to purchase 22,328 shares of common stock at an exercise price of $8.40 per share , in accordance with their terms. The Company’s warrants to purchase shares of Series B convertible preferred stock represented a freestanding financial instrument that was indexed to an obligation of the Company to repurchase its Series B convertible preferred stock by transferring assets and therefore met the criteria to be classified as a liability under ASC 480, Distinguishing Liabilities from Equity . The Company records the warrant liability at its fair value using the Black ‑Scholes option pricing model and revalues the warrant at each reporting date (see Note 4). Upon issuance of the term loan, the Company paid lender fees of $110,000 and is required to pay a one ‑time fee at maturity of $187,500 . The lender fees and warrants were recorded as a discount to the carrying amounts of the current and long term portions of the term loan. Amortization of the debt discount was $159,210 and $68,861 during the years ended December 31, 2015 and 2014, respectively. Accretion of the one ‑time fee was $84,144 and $36,394 during the years ended December 31, 2015 and 2014, respectively. The amortization of the debt discount and the accretion of the one-time fee are reflected as a components of interest expense within the Company’s statements of operations. |
Capital Structure
Capital Structure | 12 Months Ended |
Dec. 31, 2015 | |
CAPITAL STRUCTURE | |
CAPITAL STRUCTURE | 9. Capital Structure On October 20, 2015, the Company filed an amended and restated certificate of incorporation in connection with the closing of its initial public offering. The amended and restated certificate of incorporation authorizes the Company to issue two classes of stock, common stock and preferred stock, and eliminates all references to the previously existing series of preferred stock. At December 31, 2015, the total number of shares of capital stock the Company was authorized to issue was 205,000,000 of which 200,000,000 was common stock and 5,000,000 was preferred stock. All shares of common and preferred stock have a par value of $0.001 per share. At December 31, 2015, there were 8,650,143 shares of common stock outstanding and zero shares of preferred stock outstanding. Common Stock Reverse Stock Split On September 1, 2015, the Company filed an amendment to its amended and restated certificate of incorporation effecting a 1 -for-28 reverse stock split of its common stock. All share and per share amounts of common stock in the accompanying financial statements have been restated for all periods to give retroactive effect to the reverse stock split. The shares of common stock retained a par value of $0.001 per share. Accordingly, the stockholders’ equity (deficit) reflects the reverse stock split by reclassifying from common stock to additional paid-in capital an amount equal to the par value of the decreased shares resulting from the reverse stock split. Initial Public Offering On October 20, 2015, the Company closed an initial public offering of its units (the “IPO”). Each unit consisted of one share of common stock, one Class A warrant to purchase one share of common stock at an exercise price of $4.55 per share and one Class B warrant to purchase one -half share of common stock at an exercise price of $3.90 per full share (the “units”). The Class A warrants expire on October 20, 2018 and the Class B warrants expire on April 20, 2017. The closing of the IPO resulted in the sale of 4,000,000 units at an initial public offering price of $6.50 per unit for gross proceeds of $26.0 million. The net proceeds of the IPO, after underwriting discounts, commissions and expenses, and before offering expenses, to the Company were approximately $23.6 million. On November 13, 2015, the units separated into common stock, Class A warrants and Class B warrants and began trading separately on the NASDAQ Capital Market. On November 23, 2015, the underwriter of the IPO exercised its over-allotment option for 20,000 shares of common stock, 551,900 Class A warrants to purchase one share of common stock and 551,900 Class B warrants to purchase one -half share of common stock for additional gross proceeds of $135,319 . The common stock and accompanying Class A warrants and Class B warrants have been classified to stockholders’ equity (deficit) in the Company’s balance sheet. Underwriter’s Unit Purchase Option The underwriter of the IPO received, for $100 in the aggregate, a unit purchase option (the “UPO”) to purchase up to a total of 40,000 units (or 1% of the units sold in the IPO) exercisable at $7.48 per unit (or 115% of the public offering price per unit in the IPO). The units underlying the UPO will be, immediately upon exercise, separated into shares of common stock, underwriters’ Class A warrants and underwriters’ Class B warrants (such warrants together referred to as the Underwriters’ Warrants) such that, upon exercise, the holder of a UPO will not receive actual units but will instead receive the shares of common stock and Underwriters’ Warrants, to the extent that any portion of the Underwriters’ Warrants underlying such units have not otherwise expired. The exercise prices of the underwriters’ Class A warrants and underwriter’s Class B warrants underlying the UPO are $5.23 and $4.49 , respectively. The UPO may be exercised for cash or on a cashless basis, at the holder’s option, and expires on October 14, 2020; provided, that, following the expiration of underwriters’ Class B warrants on April 20, 2017, the UPO will be exercisable only for shares of common stock and underwriters’ Class A warrants at an exercise price of $7.475 per unit; provided further, that, following the expiration of underwriters’ Class A warrants on October 20, 2018, the UPO will be exercisable only for shares of common stock at an exercise price of $7.47 . The Company classified the UPO as a liability as it is a freestanding marked-to-market derivative instrument that is precluded from being classified in stockholders’ equity. The fair value of the UPO is re-measured each reporting period and the change in fair value is recognized in the statement of operations (see Note 4). Voting Common stock is entitled to one vote for each share held of record on all matters submitted to a vote of the stockholders, including the election of directors, and does not have cumulative voting rights. Accordingly, the holders of a majority of the shares of common stock entitled to vote in any election of directors can elect all of the directors standing for election. Dividends The holders of common stock are entitled to receive dividends, if any, as may be declared from time to time by the board of directors out of legally available funds. Liquidation In the event of the Company’s liquidation, dissolution or winding up, holders of the Company’s common stock will be entitled to share ratably in the net assets legally available for distribution to stockholders after the payment of all debts and other liabilities. Rights and Preferences Holders of the Company’s common stock have no preemptive, conversion or subscription rights, and there are no redemption or sinking fund provisions applicable to the Company’s common stock. Convertible Preferred Stock Preferred Stock Conversion Upon the closing of the IPO in October 2015, each share of Series A convertible preferred stock was converted into 0.04464 shares of common stock, each share of Series A ‑1 convertible preferred stock was converted into 0.05357 shares of common stock and each share of Series B convertible preferred stock was converted into 0.03571 shares of common stock. As a result, the outstanding preferred stock as of the closing of the IPO converted into 3,980,422 shares of common stock. Series A Convertible Preferred Stock Transactions On February 14, 2012, March 23, 2012 and April 4, 2012, the Company completed closings of its private placement offering of Series A convertible preferred stock in the total amount of approximately $19.0 million. The number of shares of Series A convertible preferred stock issued in the three closings was 25,305,583 along with investor warrants to purchase 225,869 shares of common stock at an exercise price equal to $28.00 per share. The placement agent received warrants to purchase 126,091 shares of common stock. On May 18, 2012, the Company completed a direct private placement of its Series A convertible preferred stock in the amount of $1.2 million. On March 23, 2012, a convertible demand promissory note with an outstanding principal balance of $3.0 million, plus accrued interest of $58,000 , was converted into 4,077,475 shares of Series A convertible preferred stock along with warrants to purchase 36,406 shares of common stock at an exercise price equal to $28.00 per share. In March 2012, an amount of $100,000 due to a related party was converted into 133,333 shares of Series A convertible preferred stock and a warrant to purchase 1,190 shares of common stock. The net proceeds to the Company from these Series A convertible preferred stock issuances after offering costs was approximately $17.7 million. In connection with the issuance of the Series B convertible preferred stock in 2014, the holders of Series A convertible preferred stock waived their contractual anti ‑dilution rights set forth in the Company’s amended and restated articles of incorporation (as amended from time to time, “Articles”). In exchange for waiving this right, the Company adjusted the conversion price for Series A convertible preferred stock of $0.75 per share to $0.60 per share. With the assistance of a third party valuation firm, management determined the fair value of the Series A convertible preferred stock to be $0.34 per share at the time of extinguishment. The $9,393,746 gain on extinguishment was equal to the excess carrying value of the Series A convertible preferred stock of $19,856,632 over the fair value of the amended Series A convertible preferred stock of $10,462,886 . Because the underlying transaction was between the Company and its equity investors, the Company accounted for the extinguishment as a noncash gain to additional paid in capital in accordance with ASC 470 ‑50 ‑40 ‑2 and included as a component of net loss attributable to common stockholders. Series A ‑1 Convertible Preferred Stock Transaction In August 2013, the Company completed a $6.8 million private equity offering of Series A-1 convertible preferred stock. The number of shares of Series A ‑1 convertible preferred stock issued was 9,074,511 shares along with investor warrants to purchase 80,966 shares of common stock. The net proceeds to the Company after offering costs were approximately $6.1 million. In connection with the issuance of the Series B convertible preferred stock in 2014, the holders of A ‑1 preferred stock waived their contractual anti ‑dilution rights under the Articles. In exchange for waiving this right, Company adjusted the conversion price for Series A ‑1 convertible preferred stock of $0.75 per share to $0.50 per share and in exchange for waiving the 2.5% cumulative dividend right, the Company issued to the holders, 6,877 shares of common stock. With the assistance of a third party valuation firm, management determined the fair value of the Series A ‑1 convertible preferred stock to be $0.37 per share at the time of extinguishment. The $3,140,692 gain on extinguishment was equal to the excess carrying value of the Series A ‑1 convertible preferred stock of $1 plus the unamortized beneficial conversion feature of $6,567,063 , over the fair value of the amended Series A ‑1 convertible preferred stock of $3,389,330 and the fair value of the 6,877 shares of common stock of $37,041 . Because the underlying transaction was between the Company and its equity investors, the Company accounted for the extinguishment as a noncash charge to additional paid in capital in accordance with ASC 470 ‑50 ‑40 ‑2. Series B Convertible Preferred Stock Transaction In July 2014, pursuant to the terms of the agreement, the Company completed an initial closing of an equity offering for 46,684,455 shares of its Series B convertible preferred stock at an original issuance price of $0.2999 per share for gross proceeds of $14.0 million. The Company also issued demand notes in July 2014, with an aggregate principal balance of $1.0 million , which were converted into 3,333,331 shares of Series B convertible preferred stock at an original issuance price of $0.2999 per share for additional gross proceeds of $1.0 million. In addition, and pursuant to the terms of several convertible promissory notes issued from April through June 2014, the Company issued 5,597,618 shares of Series B convertible preferred stock upon the conversion of the outstanding principal and interest due under the convertible promissory notes at a conversion price of $0.2249 per share for an aggregate amount of $1.3 million . In August 2014, the Company completed a second closing of an equity offering for shares of its Series B convertible preferred stock with its term loan lender. Pursuant to the same terms and conditions of the initial offering, the Company issued 3,334,445 shares of Series B convertible preferred stock to the term loan lender at an original issuance price of $0.2999 per share for additional gross proceeds of $1.0 million. The right of the investors (the “investor rights obligation”) to purchase Series B convertible preferred stock represented a freestanding financial instrument and was indexed to an obligation of the Company to repurchase its Series B convertible preferred stock by transferring assets. As such, the Company accounted for the investor rights obligation as a liability in accordance with ASC 480. The Company adjusted the carrying value of the liability to its estimated fair value at each reporting date. Increases or decreases in the fair value of the investor rights obligation were recorded as other income (expense) in the accompanying statements of operations. The fair value of the liability was determined using a valuation model, which considers the probability of achieving certain milestones, the entity’s cost of capital, the estimated period the rights will be outstanding, consideration received for the instrument with the rights, the number of shares to be issued to satisfy the rights, the price of such shares and any changes in the fair value of the underlying instrument. At the date of issuance in July 2014, the Company recorded the investor rights obligation at its initial estimated fair value of $2.6 million. The investor rights obligation expired in October 2015 upon the closing of the Company’s IPO and the Company recognized a gain on the change in fair value of $1.1 million, which was recorded as other income in the accompanying statements of operations. Common Stock Warrants At December 31, 2015, the following common stock warrants were outstanding: Number of shares Exercise price Expiration underlying warrants per share date 109,976 $ February 2017 29,260 $ February 2017 90,529 $ March 2017 29,557 $ March 2017 130,233 $ April 2017 2,275,950 $ April 2017 20,000 $ April 2017 14,284 $ July 2017 80,966 $ August 2018 4,551,900 $ October 2018 40,000 $ October 2018 3,571 $ December 2018 22,328 $ October 2020 2,380 $ May 2022 7,400,934 Series B Convertible Preferred Stock Warrants In August 2014, warrants to purchase 625,208 shares of Series B convertible preferred stock, at an exercise price equal to $0.2999 per share, were issued to the term loan lender in conjunction with the loan of $7.5 million (see Note 8). Upon the closing of the Company’s IPO, these warrants to purchase 625,208 shares of Series B convertible preferred stock became warrants to purchase 22,328 shares of common stock at an exercise price of $8.40 per share, in accordance with their terms. These warrants represent a freestanding financing instrument indexed to an obligation of the Company and as such is accounted for as a liability in accordance with ASC 480. The Company adjusts the carrying value of the liability, which appears as “warrant liability” on the accompanying balance sheets, to its estimated fair value at each reporting date (see Note 4). |
Stock Based Compensation
Stock Based Compensation | 12 Months Ended |
Dec. 31, 2015 | |
STOCK BASED COMPENSATION | |
STOCK BASED COMPENSATION | 10. Stock-Based Compensation 2011 Stock Incentive Plan On April 28, 2011, the board of directors adopted the 2011 Stock Incentive Plan (the “Plan”) reserving and authorizing up to 178,571 shares of common stock for stock ‑based compensation awards to attract, retain and reward eligible employees, consultants, and non ‑employee directors. The options have a contractual term of ten years. Generally, the options vest annually over three or four years, as determined by the board of directors, upon each option grant, although certain option grants in 2015 and 2014 were fully vested on the grant date. On January 10, 2012 and May 6, 2013, the board of directors and stockholders of the Company approved amendments to the Plan authorizing increases in the number of shares reserved for issuance under the Plan of 107,143 and 418,714 , respectively, resulting in an aggregate number of shares reserved for issuance under the Plan of 704,428 . 2015 Omnibus Plan On June 26, 2015, the board of directors adopted the 2015 Omnibus Plan, which was approved by the Company’s stockholders on August 31, 2015, reserving and authorizing up to 890,815 new shares of common stock for issuance. The 2015 Omnibus Plan became effective upon the business day immediately preceding the date of the Company’s final prospectus, which was dated October 14, 2015. As of the date of the 2015 Omnibus Plan, the 2011 Stock Incentive Plan merged with and into the 2015 Omnibus Plan and no additional grants will be made under the 2011 Stock Incentive Plan. Outstanding grants under the 2011 Stock Incentive Plan will continue in effect according to their terms as in effect before the 2015 Omnibus Plan merger, the shares with respect to outstanding grants under the 2011 Stock Incentive Plan will be issued or transferred under the 2015 Omnibus Plan, and the number of shares of common stock remaining available for issuance under the 2011 Stock Incentive Plan are authorized for issuance under the 2015 Omnibus Plan. As of December 31, 2015, there were 696,736 shares remaining under the Plan available for future issuance. During the term of the 2015 Omnibus Plan, the share reserve automatically increases on the first trading day in January of each calendar year, beginning in 2016, by an amount equal to 3% of the total number of outstanding shares of common stock on the last trading day in December of the prior calendar year. The estimated grant date fair market value of the Company’s stock ‑based awards is amortized ratably over the employees’ service periods, which is the period in which the awards vest. Stock ‑ based compensation expense recognized for the years ending December 31, 2015 and 2014 was as follows: Year Ended Year Ended December 31, 2015 December 31, 2014 Research and development $ $ General and administrative Total stock-based compensation $ $ A summary of option activity for the years ended December 31, 2015 and 2014 is as follows: Options Outstanding Weighted average Fair value of remaining Number of Weighted‑average options contractual term shares exercise price granted (in years) Balance, January 1, 2014 $ Granted $ $ Forfeitures $ Balance, December 31, 2014 $ Granted $ $ Forfeitures $ Balance, December 31, 2015 $ Vested or expected to vest at December 31, 2015 $ Exercisable at December 31, 2015 $ The aggregate intrinsic value of stock options is calculated as the difference between the exercise price of the stock options and the fair value of the Company’s common stock for those stock options that had exercise prices lower than the fair value of the Company’s common stock. As of December 31, 2015, the aggregate intrinsic value of options outstanding, vested and expected to vest was $0 . The total grant date fair value of shares which vested during the years ended December 31, 2015, 2014 and 2013 was $0.7 million, $1.3 million and $0.6 million, respectively. The per ‑share weighted ‑average grant date fair value of the options granted during 2015, 2014 and 2013 was estimated at $2.80, $2.24 and $5.60 , respectively, on the date of grant using the Black ‑Scholes option ‑pricing model with the following assumptions: Year Ended December 31, 2015 2014 2013 Risk-free interest rate - % - % - % Expected term of options (in years) - - Expected stock price volatility % % % Expected annual dividend yield % % % The valuation assumptions were determined as follows: · Risk ‑free interest rate: The Company bases the risk ‑free interest rate on the interest rate payable on U.S. Treasury securities in effect at the time of grant for a period that is commensurate with the assumed expected option term. · Expected term of options: Due to lack of sufficient historical data, the Company estimates the expected life of its stock options granted to employees and members of the board of directors as the arithmetic average of the vesting term and the original contractual term of the option. The Company estimates the expected life of its stock options granted to consultants and nonemployees to be the contractual term of the options. · Expected stock price volatility: The Company estimated the expected volatility based on actual historical volatility of the stock price of other publicly ‑traded biotechnology companies engaged in lines of business that are the same or similar to the Company’s. The Company calculated the historical volatility of the selected companies by using daily closing prices over a period of the expected term of the associated award. The companies were selected based on their enterprise value, risk profiles, position within the industry, and with historical share price information sufficient to meet the expected term of the associated award. A decrease in the selected volatility would decrease the fair value of the underlying instrument. · Expected annual dividend yield: The Company estimated the expected dividend yield based on consideration of its historical dividend experience and future dividend expectations. The Company has not historically declared or paid dividends to stockholders. Moreover, it does not intend to pay dividends in the future, but instead expects to retain any earnings to invest in the continued growth of the business. Accordingly, the Company assumed and expected dividend yield of 0.0% . The Company considered numerous objective and subjective factors in the assessment of fair value of its common stock for grants made prior to the date the Company’s common stock began trading separately on the NASDAQ Capital Market, which was November 13, 2015, and includes all grants made to date. The factors considered include the price for the Company’s convertible preferred stock that was sold to investors and the rights, preferences and privileges of the convertible preferred stock and common stock, the trading price of the Company’s units between the IPO date and November 13, 2015, the Company’s financial condition and results of operations during the relevant periods, including the status of the development of the Company’s product candidates, and the status of strategic initiatives. These estimates involve a significant level of judgment. As of December 31, 2015, there was approximately $9 00,890 of total unrecognized compensation expense related to unvested options granted under the Plan to be recognized as follows: Year ending December 31, 2016 $ 2017 2018 2019 $ |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2015 | |
INCOME TAXES | |
INCOME TAXES | 11. Income Taxes The Company’s reserves related to taxes are based on a determination of whether and how much of a tax benefit taken by the Company in its tax filings or positions is more likely than not to be realized. The Company recognized no material adjustment for unrecognized income tax benefits. Through December 31, 2015, the Company had no unrecognized tax benefits or related interest and penalties accrued. The significant components of the Company’s deferred tax assets are comprised of the following: December 31, 2015 2014 Deferred tax assets: Net operating losses $ $ Research and development credits Deferred rent Accrued compensation Stock compensation Basis difference in tangible and intangible assets Total deferred tax assets Less valuation allowance Net deferred tax asset $ — $ — For the year ended December 31, 2015, the Company increased the valuation allowance by $4.8 million to fully reserve for the value of deferred tax assets. Due to continued operating losses, there is no indication that it is more likely than not that the Company will be able to utilize its deferred tax assets. As of December 31, 2015 the Company had $51.6 million of Federal and Maryland net operating loss (“NOL”) carryforwards that will begin to expire in 2031. As of December 31, 2015 the Company had $1.4 million and $0.4 million of Maryland and federal research and development credits, respectively, that will begin to expire in 2018. The NOL and research and development credit carryforwards are subject to review and possible adjustment by the Internal Revenue Service and state tax authorities. NOL and tax credit carryforwards may become subject to an annual limitation in the event of certain cumulative changes in the ownership interest of significant shareholders over a three ‑year period in excess of 50%, as defined under Sections 382 and 383 of the Internal Revenue Code of 1986, as amended, as well as similar state tax provisions. This could limit the amount of NOLs and research and development credits that the Company can utilize annually to offset future taxable income or tax liabilities. The Company has not analyzed the historical or potential impact of its equity financings on beneficial ownership and therefore no determination has been made whether the NOL carryforwards are subject to any Internal Revenue Code Section 382 limitation. To the extent there is a limitation, which could be significant, there would be a reduction in the deferred tax asset with an offsetting reduction in the valuation allowance. Subsequent ownership changes may further affect the limitation in future years. All of the Company’s tax years are currently open to examination by each tax jurisdiction in which the Company is subject to taxation. A reconciliation of income tax expense computed at the statutory federal income tax rate to income taxes as reflected in the financial statements is as follows: December 31, 2015 2014 Federal statutory rate % % Permanent differences % % Warrants % % State taxes % % Research and development credit % % Other % % Change in valuation allowance % % Effective income tax rate % % |
Commitments And Contingencies
Commitments And Contingencies | 12 Months Ended |
Dec. 31, 2015 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | 12. Commitments and Contingencies Offer Letters The Company has entered into offer letters with certain of its executives. The letters provide for, among other items, salary, bonus and severance payments. Resignation of Former Chief Executive Officer On December 17, 2015, the Company’s President and former Chief Executive Officer (“CEO”) resigned, which included his resignation as a member of the board of directors of the Company, in each case effective December 31, 2015. The Company entered into a separation agreement pursuant to which the Company agreed to pay the former CEO severance payments in accordance with his existing employment agreement totaling $527,500 and the maintenance of health benefits for a period of up to one year from the separation date. The separation agreement also provided for the modification of existing stock option grants such that all unvested portions of existing stock option grants were immediately vested and all existing stock option grants became exercisable for up to 90 days from the date of separation as in accordance with the terms of the original grants. The former CEO is subject to restrictive covenants, including non-competition and non-solicitation provisions. The severance payments and stock-based compensation related to the modification of existing grants was included as part of general and administrative expenses for the year ended December 31, 2015 in the accompanying statement of operations. Office Lease In August 2013, the Company entered into a lease for new corporate office space location in Baltimore, Maryland. The lease provides for three months of rent abatement and includes escalating rent payments. Rent expense is recognized on a straight ‑line basis over the term of the lease. Rent expense amounted to approximately $190,000 and $192,000 for the years ended December 31, 2015 and 2014, respectively . Pursuant to the terms of such lease, the Company’s future lease obligation is as follows: Year ending December 31, 2016 $ 2017 2018 $ Obligations to Contract Research Organizations and External Service Providers The Company has entered into agreements with contract research organizations and other external service providers for services, primarily in connection with the clinical trials and development of the Company’s product candidates. The Company was contractually obligated for up to approximately $3.6 million of future services under these agreements as of December 31, 2015. The Company’s actual contractual obligations will vary depending upon several factors, including the progress and results of the underlying services. |
Selected Quarterly Financial Da
Selected Quarterly Financial Data (Unaudited) | 12 Months Ended |
Dec. 31, 2015 | |
Quarterly Financial Data [Abstract] | |
Quarterly Financial Information [Text Block] | 13. Selected Quarterly Financial Data (Unaudited) The following table sets forth certain unaudited quarterly financial data for 2015 and 2014. This unaudited information has been prepared on the same basis as the audited information included elsewhere in this Annual Report on Form 10-K and includes all adjustments necessary to present fairly the information set forth therein. Three Months Ended March 31, June 30, September 30, December 31, 2015 2015 2015 2015 (in thousands, except per share data) Operating expenses: Research and development $ $ $ $ General and administrative Change in fair value of warrant liability, unit purchase option liability and investor rights obligation Interest income (expense), net Net loss $ $ $ $ Net loss attributable to common stockholders $ $ $ $ Net loss per share of common stock, basic and diluted $ $ $ $ Three Months Ended March 31, June 30, September 30, December 31, 2014 2014 2014 2014 (in thousands, except per share data) Operating expenses: Research and development $ $ $ $ General and administrative Change in fair value of warrant liability, unit purchase option liability and investor rights obligation — Interest income (expense), net Net loss $ $ $ $ Net income (loss) attributable to common stockholders $ $ $ $ Earnings (net loss) per share of common stock, basic and diluted $ $ $ $ |
Significant Accounting Polici20
Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2015 | |
SIGNIFICANT ACCOUNTING POLICIES | |
Basis of Presentation | Basis of Presentation The accompanying financial statements have been prepared in conformity with U. S. generally accepted accounting principles (“GAAP”). Any reference in these notes to applicable guidance is meant to refer to the authoritative GAAP as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Updates (“ASU”) of the Financial Accounting Standards Board (“FASB”). |
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, liabilities, revenues, expenses, other comprehensive income and related disclosures. On an ongoing basis, management evaluates its estimates, including estimates related to clinical trial accruals, warrant liability and embedded derivative liabilities. The Company bases its estimates on historical experience and other market ‑specific or other relevant assumptions that it believes to be reasonable under the circumstances. Actual results may differ from those estimates or assumptions. Prior to being a public company, the Company utilized estimates and assumptions in determining the fair value of its common stock as an input for determining the grant date fair value of stock option grants. Management used the assistance of a third ‑party valuation firm in estimating the fair value of the common stock. The board of directors determined the estimated fair value of the common stock based on a number of objective and subjective factors, including external market conditions affecting the biotechnology industry sector and the historic prices at which the Company sold shares of its preferred stock. |
Net Loss Per Share, Basic and Diluted | Net Loss Per Share, Basic and Diluted Basic net loss per share of common stock is computed by dividing net loss attributable to common stockholders by the weighted ‑average number of shares of common stock outstanding during the period, excluding the dilutive effects, if any, of preferred stock, the investor rights obligation, warrants on preferred stock and common stock, stock options and unvested restricted stock. Diluted net loss per share of common stock is computed by dividing the net loss attributable to common stockholders by the sum of the weighted ‑average number of shares of common stock outstanding during the period plus the potential dilutive effects of preferred stock, the investor rights obligation, warrants on preferred stock and common stock, stock options and unvested restricted stock outstanding during the period calculated in accordance with the treasury stock method, although these shares and options are excluded if their effect is anti ‑dilutive. In addition, the Company analyzes the potential dilutive effect of the outstanding preferred stock, the investor rights obligation, and warrants on preferred stock and common stock under the “if ‑converted” method when calculating diluted earnings per share, in which it is assumed that the outstanding security converts into common stock at the beginning of the period. Because the impact of these items is generally anti ‑dilutive during periods of net loss, there was no difference between basic and diluted net loss per share of common stock for the years ended December 31, 2015, 2014 and 2013. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. The carrying amounts reported in the balance sheets for cash and cash equivalents are valued at cost, which approximates their fair value. |
Restricted Cash | Restricted Cash During the third quarter of 2013, the Company entered into a lease for new office space for its principal offices in Baltimore, Maryland. The Company has provided the landlord with a Letter of Credit in the amount of $175,000 as security by the Company of the Company’s obligations under the Lease. The Letter of Credit is supported by funds that are invested in a certificate of deposit. Provided there has been no event of default by the Company, the Company may request that the amount of the Letter of Credit be reduced by one ‑third (approximately $58,000 ) at the end of each of the first three years of the lease term. At the expiration of the third year of the lease term, the Company shall deposit with Landlord the sum of $13,000 as a security deposit. |
Concentration of Credit Risk | Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk are primarily cash and cash equivalents. The Company maintains a portion of its cash and cash equivalent balances in the form of a money market account with a financial institution that management believes to be creditworthy. The Company has no financial instruments with off ‑balance sheet risk of loss. |
Debt Issuance Costs | Debt Issuance Costs The Company may record debt and equity discounts in connection with raising funds through the issuance of convertible notes or equity instruments. These discounts may arise from (i) the receipt of proceeds less than the face value of the convertible notes or equity instruments, (ii) allocation of proceeds to beneficial conversion features and/or (iii) recording derivative liabilities related to embedded features. These costs are amortized over the life of the debt to interest expense utilizing the effective interest method. |
Property and Equipment | Property and Equipment Property and equipment consists of computers, office equipment, and furniture and is recorded at cost. Maintenance and repairs that do not improve or extend the lives of the respective assets are expensed to operations as incurred. Property and equipment are depreciated on a straight ‑line basis over their estimated useful lives. The Company uses a life of four years for computers and software, and five years for equipment and furniture . Upon retirement or sale, the cost of the disposed asset and the related accumulated depreciation are removed from the accounts and any resulting gain or loss is recognized. |
Impairment of Long-Lived Assets | Impairment of Long ‑Lived Assets Long ‑lived assets consist of property and equipment. Long ‑lived assets to be held and used are tested for recoverability whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable. Factors that the Company considers in deciding when to perform an impairment review include significant underperformance of the business in relation to expectations, significant negative industry or economic trends and significant changes or planned changes in the use of the assets. If an impairment review is performed to evaluate a long ‑lived asset or asset group for recoverability, the Company would compare forecasts of undiscounted cash flows expected to result from the use and eventual disposition of the long ‑lived asset or asset group to its carrying value. An impairment loss would be recognized when estimated undiscounted future cash flows expected to result from the use and eventual disposition of an asset or asset group are less than its carrying amount. The impairment loss would be based on the excess of the carrying value of the impaired asset or asset group over its fair value, determined based on discounted cash flows. To date, the Company has not recorded any impairment losses on long ‑lived assets. |
Research and Development | Research and Development Research and development costs are expensed as incurred. These costs include, but are not limited to, employee ‑related expenses, including salaries, benefits and stock ‑based compensation of research and development personnel; expenses incurred under agreements with contract research organizations and investigative sites that conduct clinical trials and preclinical studies; the cost of acquiring, developing and manufacturing clinical trial materials; other supplies; facilities, depreciation and other expenses, which include direct and allocated expenses for rent, utilities and insurance; and costs associated with preclinical activities and regulatory operations. Costs for certain development activities, such as clinical trials, are recognized based on an evaluation of the progress to completion of specific tasks using data such as patient enrollment, clinical site activations, or information provided to the Company by its vendors, such as clinical research organizations, with respect to their actual costs incurred. Payments for these activities are based on the terms of the individual arrangements, which may differ from the pattern of costs incurred, and are reflected in the financial statements as prepaid or accrued research and development expense, as the case may be. |
Comprehensive Loss | Comprehensive Loss Comprehensive loss is defined as the change in equity of a business enterprise during a period from transactions and other events and circumstances from non ‑owner sources. Comprehensive loss was equal to net loss for all periods presented. |
Income Taxes | Income Taxes The Company accounts for income taxes under the asset and liability method in accordance with ASC 740, Income Taxes (“ASC 740”). Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases using enacted tax rates in effect for the year in which the differences are expected to affect taxable income. The deferred tax asset primarily includes net operating loss and tax credit carryforwards, accrued expenses not currently deductible and the cumulative temporary differences related to certain research and patent costs, which have been charged to expense in the accompanying statements of operations but have been recorded as assets for income tax purposes. The portion of any deferred tax asset for which it is more likely than not that a tax benefit will not be realized must then be offset by recording a valuation allowance. A full valuation allowance has been established against all of the deferred tax assets (see Note 11) as it is more likely than not that these assets will not be realized given the Company’s history of operating losses. The Company recognizes the tax benefit from an uncertain tax position only if it is more likely than not to be sustained upon examination based on the technical merits of the position. The amount for which an exposure exists is measured as the largest amount of benefit determined on a cumulative probability basis that the Company believes is more likely than not to be realized upon ultimate settlement of the position. The Company’s policy is to record interest and penalties on uncertain tax positions as income tax expense. As of December 31, 2015, the Company does not believe any material uncertain tax positions are present. |
Stock-Based Compensation | Stock ‑Based Compensation At December 31, 2015, the Company had one stock ‑based compensation plan (see Note 10). The Company applies the provisions of ASC 718, Compensation—Stock Compensation (“ASC 718”), which requires the measurement and recognition of compensation expense for all stock ‑based awards made to employees and non ‑employees, including employee stock options in the statements of operations. For stock options issued to employees and members of the board of directors for their services on the board of directors, the Company estimates the grant date fair value of each option using the Black ‑Scholes option pricing model. The use of the Black ‑Scholes option pricing model requires management to make assumptions with respect to the expected term of the option, the expected volatility of the common stock consistent with the expected life of the option, risk ‑free interest rates, the value of the common stock and expected dividend yields of the common stock. For awards subject to service ‑based vesting conditions, including those with a graded vesting schedule, the Company recognizes stock ‑based compensation expense, net of estimated forfeitures, equal to the grant date fair value of stock options on a straight ‑line basis over the requisite service period, which is generally the vesting term. Forfeitures are required to be estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. For stock options issued to non ‑employees, the Company initially measures the options at their grant date fair values and revalues as the underlying equity instruments vest and are recognized as expense over the earlier of the period ending with the performance commitment date or the date the services are completed in accordance with the provisions of ASC 718 and ASC 505 ‑50, Equity ‑Based Payments to Non ‑Employees (“ASC 505 ‑50”). See Note 10 for a discussion of the assumptions used by the Company in determining the grant date fair value of options granted under the Black ‑Scholes option pricing model, as well as a summary of the stock option activity under the Company’s stock ‑based compensation plan. |
Clinical Trial Expense Accruals | Clinical Trial Expense Accruals As part of the process of preparing its financial statements, the Company is required to estimate its expenses resulting from its obligations under contracts with vendors, clinical research organizations and consultants and under clinical site agreements in connection with conducting clinical trials. The financial terms of these contracts are subject to negotiations, which vary from contract to contract and may result in payment flows that do not match the periods over which materials or services are provided under such contracts. The Company’s objective is to reflect the appropriate trial expenses in its financial statements by matching those expenses with the period in which services are performed and efforts are expended. The Company accounts for these expenses according to the progress of the trial as measured by subject progression and the timing of various aspects of the trial. The Company determines accrual estimates by taking into account discussion with applicable personnel and outside service providers as to the progress or state of consummation of trials, or the services completed. During the course of a clinical trial, the Company adjusts its clinical expense recognition if actual results differ from its estimates. The Company makes estimates of its accrued expenses as of each balance sheet date based on the facts and circumstances known to it at that time. The Company’s clinical trial accruals are dependent upon the timely and accurate reporting of contract research organizations and other third ‑party vendors. Although the Company does not expect its estimates to be materially different from amounts actually incurred, its understanding of the status and timing of services performed relative to the actual status and timing of services performed may vary and may result in it reporting amounts that are too high or too low for any particular period. For the years ended December 31, 2015 and December 31, 2014, there were no material adjustments to the Company’s prior period estimates of accrued expenses for clinical trials. |
Segment Information | Segment Information Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision maker, or decision ‑making group, in making decisions on how to allocate resources and assess performance. The Company’s chief operating decision maker is the chief executive officer. The Company and the chief executive officer view the Company’s operations and manage its business as one operating segment. All long ‑lived assets of the Company reside in the United States. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014 ‑09, Revenue From Contracts With Customers , (“ASU 2014 ‑09”). Pursuant to ASU 2014 ‑09, an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. For a public entity, ASU 2014 ‑09 is effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. Early application is not permitted. The Company has not yet determined the impact of adoption on the financial statements, although, the impact is not expected to be significant given the Company has not historically recognized significant amounts of revenue. In June 2014, the FASB issued ASU No. 2014 ‑10, Development Stage Entities (Topic 915): Elimination of Certain Financial Reporting Requirements, Including an Amendment to Variable Interest Entities Guidance in Topic 810, Consolidation , or Topic 915. The guidance set forth in Topic 915 is intended to reduce the overall cost and complexity associated with financial reporting for development stage entities without reducing the availability of relevant information. The FASB also believes the changes will simplify the consolidation accounting guidance by removing the differential accounting requirements for development stage entities. As a result of these changes, there no longer will be any accounting or reporting differences in generally accepted accounting principles, or GAAP, between development stage entities and other operating entities. For organizations defined as public business entities, the presentation and disclosure requirements in Topic 915 will no longer be required starting with the first annual period beginning after December 15, 2014, including interim periods therein. Early application is permitted for any annual reporting period or interim period for which the entity’s financial statements have not yet been issued (public business entities) or made available for issuance (other entities). The Company early adopted this guidance during the year ended December 31, 2014 and, as a result, inception ‑to ‑date information about the statements of operations, cash flows, and stockholders’ deficit is no longer presented. In August 2014, FASB issued ASU No. 2014 ‑15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern . The amendments in this update will explicitly require a company’s management to assess an entity’s ability to continue as a going concern, and to provide related footnote disclosures in certain circumstances. The new standard will be effective in the first annual period ending after December 15, 2016. Early adoption is permitted. The Company is currently evaluating the potential impact of the adoption of this standard, but believes its adoption will have no impact on its financial position, results of operations or cash flows. In November 2014, the FASB issued ASU No. 2014 ‑16, Determining Whether the Host Contract in a Hybrid Financial Instrument Issued in the Form of a Share is more akin to Debt or to Equity . The amendments in this update clarify how current GAAP should be interpreted in evaluating the economic characteristics and risks of a host contract in a hybrid financial instrument that is issued in the form of a share. Specifically, the amendments clarify that an entity should consider all relevant terms and features—including the embedded derivative feature being evaluated for bifurcation—in evaluating the nature of the host contract. The amendments in this update are effective for public companies for fiscal years and interim periods within those fiscal years, beginning after December 15, 2015 with early adoption permitted. The Company adopted this guidance beginning with the year ended December 31, 2014 and has properly applied it to its hybrid financial instruments. In April 2015, the FASB issued ASU No. 2015 ‑03, Simplifying the Presentation of Debt Issuance Costs. The guidance requires debt issuance costs to be presented in the balance sheet as a direct deduction from the carrying value of the associated debt liability, consistent with the presentation of a debt discount. The standard also aligns the GAAP presentation with International Financial Reporting Standards and will remedy the long ‑standing conflict with the guidance in FASB Concepts Statement No. 6, Elements of Financial Statements, which indicates that debt issuance costs do not meet the definition of an asset, because they provide no future economic benefit. For public companies, the standard is effective for financial statements issued for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. Early adoption is permitted for financial statements that have not been previously issued. The new guidance will be applied on a retrospective basis. The Company is currently evaluating the potential impact of the adoption of this standard, but believes its adoption will have no impact on its financial position, results of operations or cash flows. |
Net Loss Per Share Of Common 21
Net Loss Per Share Of Common Stock, Basic And Diluted (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
NET LOSS PER SHARE OF COMMON STOCK, BASIC AND DILUTED | |
Schedule of the computation of basic and diluted net loss per share of Common Stock | Year ended Year ended Year ended December 31, December 31, December 31, Net loss per share, basic and diluted calculation: 2015 2014 2013 Net loss $ $ $ Extinguishment upon modification of Series A and A-1 convertible preferred stock — — Deemed dividend — — Net loss attributable to common stockholders $ $ $ Weighted-average common shares outstanding Net loss per share, basic and diluted $ $ $ |
Schedule of anti-dilutive securities excluded from computation of diluted weighted shares outstanding | December 31, December 31, December 31, 2015 2014 2013 Series A convertible preferred stock — Series A-1 convertible preferred stock — Series B convertible preferred stock — — Common stock dividends on Series A-1 convertible preferred stock — — Unvested restricted stock — — Stock options Warrants on common stock Warrants on preferred stock — — Investor rights obligation — — Underwriters' unit purchase option — — |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
FAIR VALUE MEASUREMENTS | |
Schedule of assets and liabilities that are measured at fair value on a recurring basis | December 31, 2015 Fair Value Measurements Using Quoted prices in Significant other Significant active markets for observable unobservable identical assets inputs inputs (Level 1) (Level 2) (Level 3) Assets Investments in money market funds* $ $ — $ — Liabilities Warrant liability $ — $ — $ Unit purchase option liability — $ — $ December 31, 2014 Fair Value Measurements Using Quoted prices in Significant other Significant active markets for observable unobservable identical assets inputs inputs (Level 1) (Level 2) (Level 3) Assets Investments in money market funds* $ $ — $ — Liabilities Investor rights obligation $ — $ — $ Warrant liability — $ — $ * Investments in money market funds are reflected in cash and cash equivalents on the accompanying Balance Sheets. |
Summary of changes in the fair value of the Level 3 valuation for the Warrant Liability and the Investor Rights Obligation | Warrant Unit purchase Investor rights liability option liability obligation Total Balance at December 31, 2014 $ $ — $ $ Issuance of unit purchase option — — Expiration of investor rights obligation — — Change in fair value — Balance at December 31, 2015 $ $ $ — $ Warrant Unit purchase Investor rights liability option liability obligation Total Balance at December 31, 2013 $ $ — $ — $ Issuance of warrants with debt and equity financings — — Recording of investor rights obligation at fair value — — Change in fair value — Reclassification of liability to stockholders’ equity — — Balance at December 31, 2014 $ $ — $ $ |
Property And Equipment (Tables)
Property And Equipment (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
PROPERTY AND EQUIPMENT | |
Summary of property and equipment | December 31, 2015 2014 Furniture and equipment $ $ Computers and software Total property and equipment Less accumulated depreciation Property and equipment, net $ $ |
Accrued Expenses And Other Cu24
Accrued Expenses And Other Current Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES | |
Schedule of accrued expenses and other current liabilities | December 31, 2015 2014 Compensation and benefits $ $ Research and development expenses General and administrative Accrued interest Total accrued expenses and other current liabilities $ $ |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
DEBT | |
Schedule of debt | December 31, December 31, 2015 2014 Term loan $ $ Less: debt discount Term Loan, net of debt discount Less: current portion, net of debt discount Long term debt, net of current portion and debt discount $ $ |
Schedule of future principal payments | Year ending December 31, 2016 $ 2017 $ |
Capital Structure (Tables)
Capital Structure (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
CAPITAL STRUCTURE | |
Schedule of outstanding common stock warrants | Number of shares Exercise price Expiration underlying warrants per share date 109,976 $ February 2017 29,260 $ February 2017 90,529 $ March 2017 29,557 $ March 2017 130,233 $ April 2017 2,275,950 $ April 2017 20,000 $ April 2017 14,284 $ July 2017 80,966 $ August 2018 4,551,900 $ October 2018 40,000 $ October 2018 3,571 $ December 2018 22,328 $ October 2020 2,380 $ May 2022 7,400,934 |
Stock Based Compensation (Table
Stock Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
STOCK BASED COMPENSATION | |
Schedule of stock-based compensation expense | Year Ended Year Ended December 31, 2015 December 31, 2014 Research and development $ $ General and administrative Total stock-based compensation $ $ |
Summary of option activity | Options Outstanding Weighted average Fair value of remaining Number of Weighted‑average options contractual term shares exercise price granted (in years) Balance, January 1, 2014 $ Granted $ $ Forfeitures $ Balance, December 31, 2014 $ Granted $ $ Forfeitures $ Balance, December 31, 2015 $ Vested or expected to vest at December 31, 2015 $ Exercisable at December 31, 2015 $ |
Schedule of fair value assumptions for options | Year Ended December 31, 2015 2014 2013 Risk-free interest rate - % - % - % Expected term of options (in years) - - Expected stock price volatility % % % Expected annual dividend yield % % % |
Schedule of unrecognized compensation expense | Year ending December 31, 2016 $ 2017 2018 2019 $ |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
INCOME TAXES | |
Schedule of components of deferred tax assets | December 31, 2015 2014 Deferred tax assets: Net operating losses $ $ Research and development credits Deferred rent Accrued compensation Stock compensation Basis difference in tangible and intangible assets Total deferred tax assets Less valuation allowance Net deferred tax asset $ — $ — |
Reconciliation of income tax expenses between federal statutory rate and effective income tax rate | December 31, 2015 2014 Federal statutory rate % % Permanent differences % % Warrants % % State taxes % % Research and development credit % % Other % % Change in valuation allowance % % Effective income tax rate % % |
Commitments And Contingencies (
Commitments And Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
COMMITMENTS AND CONTINGENCIES | |
Schedule of future lease obligations | Year ending December 31, 2016 $ 2017 2018 $ |
Selected Quarterly Financial 30
Selected Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Quarterly Financial Data [Abstract] | |
Schedule of certain unaudited quarterly financial data | Three Months Ended March 31, June 30, September 30, December 31, 2015 2015 2015 2015 (in thousands, except per share data) Operating expenses: Research and development $ $ $ $ General and administrative Change in fair value of warrant liability, unit purchase option liability and investor rights obligation Interest income (expense), net Net loss $ $ $ $ Net loss attributable to common stockholders $ $ $ $ Net loss per share of common stock, basic and diluted $ $ $ $ Three Months Ended March 31, June 30, September 30, December 31, 2014 2014 2014 2014 (in thousands, except per share data) Operating expenses: Research and development $ $ $ $ General and administrative Change in fair value of warrant liability, unit purchase option liability and investor rights obligation — Interest income (expense), net Net loss $ $ $ $ Net income (loss) attributable to common stockholders $ $ $ $ Earnings (net loss) per share of common stock, basic and diluted $ $ $ $ |
Business (Details)
Business (Details) - USD ($) | Oct. 20, 2015 | Oct. 31, 2015 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Net loss | $ (3,648,000) | $ (692,000) | $ (2,912,000) | $ (3,238,000) | $ (2,523,000) | $ (5,840,000) | $ (4,064,000) | $ (3,629,000) | $ (10,490,103) | $ (16,055,591) | $ (13,045,008) | ||
Cash flows from operations | (10,163,380) | (15,518,349) | $ (11,485,140) | ||||||||||
Accumulated deficit | $ (53,563,480) | $ (43,073,377) | $ (53,563,480) | $ (43,073,377) | |||||||||
IPO | Capital Unit | |||||||||||||
Shares issued | 4,000,000 | 4,000,000 | |||||||||||
Issue price per share | $ 6.50 | $ 6.50 | |||||||||||
Gross proceeds | $ 26,000,000 | $ 26,000,000 | |||||||||||
Net proceeds from IPO | $ 23,600,000 | $ 23,600,000 |
Significant Accounting Polici32
Significant Accounting Policies (Details) | 3 Months Ended | 12 Months Ended | ||
Sep. 30, 2013USD ($) | Dec. 31, 2015segmentitemshares | Dec. 31, 2014itemshares | Dec. 31, 2013shares | |
Net Loss Per Share of Common Stock, Basic and Diluted | ||||
Anti-dilutive amount | shares | 0 | 0 | 0 | |
Restricted Cash [Abstract] | ||||
Certificate of deposit supporting lease obligation | $ 175,000 | |||
Annual reduction permitted in restricted cash, as a percent | 33.00% | |||
Annual reduction permitted in restricted cash | 58,000 | |||
Number of periods reduction may be allowed | 3 years | |||
Security deposit required, end of third year | $ 13,000 | |||
STOCK BASED COMPENSATION | ||||
Number of stock-based compensation plans | item | 1 | |||
Clinical Trial Expense Accruals | ||||
Number of material adjustments to prior period estimates of accrued expenses | item | 0 | 0 | ||
Segment information | ||||
Number of Operating Segments | segment | 1 | |||
Computers and software | ||||
PROPERTY AND EQUIPMENT | ||||
Property, Plant and Equipment, Useful Life | 4 years | |||
Equipment [Member] | ||||
PROPERTY AND EQUIPMENT | ||||
Property, Plant and Equipment, Useful Life | 5 years | |||
Furniture and Fixtures [Member] | ||||
PROPERTY AND EQUIPMENT | ||||
Property, Plant and Equipment, Useful Life | 5 years |
Net Loss Per Share Of Common 33
Net Loss Per Share Of Common Stock, Basic And Diluted (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
NET LOSS PER SHARE OF COMMON STOCK, BASIC AND DILUTED | |||||||||||
Net loss | $ (3,648,000) | $ (692,000) | $ (2,912,000) | $ (3,238,000) | $ (2,523,000) | $ (5,840,000) | $ (4,064,000) | $ (3,629,000) | $ (10,490,103) | $ (16,055,591) | $ (13,045,008) |
Extinguishment upon modification of Series A and A-1 Convertible Preferred Stock | 12,534,438 | ||||||||||
Deemed dividend | (81,964) | ||||||||||
Net loss attributable to Common Stockholders | $ (3,648,000) | $ (692,000) | $ (2,912,000) | $ (3,238,000) | $ (2,523,000) | $ 6,695,000 | $ (4,064,000) | $ (3,629,000) | $ (10,490,103) | $ (3,521,153) | $ (13,126,972) |
Weighted average shares of Common Stock outstanding, basic and diluted | 2,226,023 | 642,052 | 633,669 | ||||||||
Net loss per share, basic and diluted | $ (0.53) | $ (1.06) | $ (4.48) | $ (4.98) | $ (3.88) | $ 10.35 | $ (6.39) | $ (5.71) | $ (4.71) | $ (5.48) | $ (20.72) |
Net Loss Per Share Of Common 34
Net Loss Per Share Of Common Stock, Basic And Diluted - Anti-dilutive Securities (Details) - shares | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Anti-dilutive securities | |||
Anti- dilutive securities excluded from the computation of diluted weighted shares outstanding | 0 | 0 | 0 |
Series A Convertible preferred stock | |||
Anti-dilutive securities | |||
Anti- dilutive securities excluded from the computation of diluted weighted shares outstanding | 31,116,391 | 31,116,391 | |
Series A-1 Convertible preferred stock | |||
Anti-dilutive securities | |||
Anti- dilutive securities excluded from the computation of diluted weighted shares outstanding | 9,074,511 | 9,074,511 | |
Series B convertible preferred stock | |||
Anti-dilutive securities | |||
Anti- dilutive securities excluded from the computation of diluted weighted shares outstanding | 58,948,735 | ||
Common Stock dividends on Series A-1 Convertible Preferred Stock | |||
Anti-dilutive securities | |||
Anti- dilutive securities excluded from the computation of diluted weighted shares outstanding | 2,846 | ||
Unvested restricted stock | |||
Anti-dilutive securities | |||
Anti- dilutive securities excluded from the computation of diluted weighted shares outstanding | 7,142 | ||
Stock Options | |||
Anti-dilutive securities | |||
Anti- dilutive securities excluded from the computation of diluted weighted shares outstanding | 959,188 | 552,726 | 381,669 |
Warrants on Common Stock | |||
Anti-dilutive securities | |||
Anti- dilutive securities excluded from the computation of diluted weighted shares outstanding | 7,400,934 | 681,858 | 512,686 |
Warrants on Preferred Stock | |||
Anti-dilutive securities | |||
Anti- dilutive securities excluded from the computation of diluted weighted shares outstanding | 625,208 | ||
Investor Rights Obligation | |||
Anti-dilutive securities | |||
Anti- dilutive securities excluded from the computation of diluted weighted shares outstanding | 53,351,117 | ||
Underwriters Unit Purchase Option | |||
Anti-dilutive securities | |||
Anti- dilutive securities excluded from the computation of diluted weighted shares outstanding | 40,000 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Estimated fair value of debt | $ 5,700,000 | |
Recurring basis | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments in money market funds | 21,122,553 | $ 11,251,724 |
Recurring basis | Level 3 | Investor Rights Obligation | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Liabilities and obligations | 1,112,000 | |
Recurring basis | Level 3 | Warrants on Preferred Stock | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Liabilities and obligations | 27,606 | $ 69,684 |
Recurring basis | Level 3 | Equity Unit Purchase Option [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Liabilities and obligations | $ 50,571 |
Fair Value Measurements - Assum
Fair Value Measurements - Assumptions, RF (Details) | Oct. 20, 2015USD ($)$ / shares | Dec. 31, 2015USD ($)item$ / sharesshares | Dec. 31, 2014USD ($)item$ / shares |
Summary of changes in the fair value of the Level 3 valuation for the Warrant Liability and the Investor Rights Obligation | |||
Number of changes in valuation techniques | item | 0 | 0 | |
Amount of transfers of assets from level 1 to level 2 | $ 0 | $ 0 | |
Amount of transfers of assets from level 2 to level 1 | $ 0 | 0 | |
Common stock warrants | |||
Level 3 Valuation | |||
Number of shares available under warrant | shares | 40,000 | ||
Level 3 | |||
Summary of changes in the fair value of the Level 3 valuation for the Warrant Liability and the Investor Rights Obligation | |||
Beginning balance | $ 1,181,684 | 431,582 | |
Issuance of liability | 209,542 | 844,056 | |
Expiration of obligation | (1,112,000) | ||
Recording of obligation at fair value | 2,598,510 | ||
Change in fair value | (201,049) | (2,266,161) | |
Reclassification of liability to stockholders' equity | (426,303) | ||
Ending balance | $ 78,177 | 1,181,684 | |
Warrants on Preferred Stock | Level 3 | |||
Level 3 Valuation | |||
Volatility | 70.00% | ||
Risk free interest rate | 1.72% | ||
Strike price | $ / shares | $ 8.40 | ||
Fair value of stock price | $ / shares | $ 3.35 | ||
Expected life | 4 years 9 months 18 days | ||
Summary of changes in the fair value of the Level 3 valuation for the Warrant Liability and the Investor Rights Obligation | |||
Beginning balance | $ 69,684 | 431,582 | |
Issuance of liability | 844,056 | ||
Change in fair value | (42,078) | (779,651) | |
Reclassification of liability to stockholders' equity | (426,303) | ||
Ending balance | $ 27,606 | $ 69,684 | |
Investor Rights Obligation | Level 3 | |||
Level 3 Valuation | |||
Volatility | 60.00% | 60.00% | |
Strike price | $ / shares | $ 8.4000 | ||
Summary of changes in the fair value of the Level 3 valuation for the Warrant Liability and the Investor Rights Obligation | |||
Beginning balance | $ 1,112,000 | ||
Expiration of obligation | (1,112,000) | ||
Recording of obligation at fair value | $ 2,598,510 | ||
Change in fair value | (1,486,510) | ||
Ending balance | $ 1,112,000 | ||
Investor Rights Obligation | Level 3 | Minimum | |||
Level 3 Valuation | |||
Risk free interest rate | 0.05% | ||
Fair value of stock price | $ / shares | $ 0 | ||
Expected life | 6 months | ||
Investor Rights Obligation | Level 3 | Maximum | |||
Level 3 Valuation | |||
Risk free interest rate | 0.63% | ||
Fair value of stock price | $ / shares | $ 5.04 | ||
Expected life | 1 year 9 months | ||
Equity Unit Purchase Option [Member] | Other Nonoperating Income (Expense) | |||
Summary of changes in the fair value of the Level 3 valuation for the Warrant Liability and the Investor Rights Obligation | |||
Change in fair value | $ 158,971 | ||
Equity Unit Purchase Option [Member] | Level 3 | |||
Level 3 Valuation | |||
Strike price | $ / shares | $ 7.48 | $ 7.48 | |
Fair value of stock price | $ / shares | $ 4.98 | $ 3.35 | |
Summary of changes in the fair value of the Level 3 valuation for the Warrant Liability and the Investor Rights Obligation | |||
Issuance of liability | $ 209,542 | ||
Change in fair value | (158,971) | ||
Ending balance | $ 209,542 | $ 50,571 | |
Equity Unit Purchase Option [Member] | Level 3 | Class A Warrant [Member] | |||
Level 3 Valuation | |||
Strike price | $ / shares | $ 5.23 | $ 5.23 | |
Equity Unit Purchase Option [Member] | Level 3 | Class B Warrant [Member] | |||
Level 3 Valuation | |||
Strike price | $ / shares | $ 4.49 | $ 4.49 | |
Equity Unit Purchase Option [Member] | Level 3 | Minimum | |||
Level 3 Valuation | |||
Volatility | 65.00% | 55.00% | |
Risk free interest rate | 0.03% | 0.14% | |
Equity Unit Purchase Option [Member] | Level 3 | Maximum | |||
Level 3 Valuation | |||
Volatility | 90.00% | 85.00% | |
Risk free interest rate | 1.29% | 1.16% |
Property And Equipment (Details
Property And Equipment (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Property, Plant and Equipment [Line Items] | |||
Total property and equipment | $ 96,051 | $ 76,068 | |
Less accumulated depreciation | (60,835) | (37,328) | |
Property and equipment, net | 35,216 | 38,740 | |
Depreciation expense | 23,508 | 28,943 | $ 20,032 |
Furniture and equipment | |||
Property, Plant and Equipment [Line Items] | |||
Total property and equipment | 34,918 | 34,918 | |
Computers and software | |||
Property, Plant and Equipment [Line Items] | |||
Total property and equipment | $ 61,133 | $ 41,150 |
Accrued Expenses And Other Cu38
Accrued Expenses And Other Current Liabilities (Details) - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES | ||
Compensation and benefits | $ 1,128,073 | $ 129,450 |
Research and development expenses | 464,719 | 598,883 |
General and administrative | 253,132 | 159,045 |
Accrued interest | 39,534 | 87,736 |
Total accrued expenses and other current liabilities | $ 1,885,458 | $ 975,114 |
Asset Acquisition And License39
Asset Acquisition And License Agreements (Details) - USD ($) | 1 Months Ended | 12 Months Ended | ||
Feb. 28, 2015 | Mar. 31, 2013 | Dec. 31, 2015 | Dec. 31, 2013 | |
Merck | CERC-301 | ||||
Asset Acquisition And License Agreement [Line Items] | ||||
Total Cost of License Agreement | $ 1,500,000 | |||
Other Commitment | $ 750,000 | |||
Merck | CERC-301 | Research and development expense | ||||
Asset Acquisition And License Agreement [Line Items] | ||||
Asset acquisition payments | $ 750,000 | |||
Merck | COMT Inhibitor | ||||
Asset Acquisition And License Agreement [Line Items] | ||||
Asset acquisition payments | $ 200,000 | |||
Merck | COMT Inhibitor | Royalty Commitment | ||||
Asset Acquisition And License Agreement [Line Items] | ||||
Term of royalty obligation | 10 years | |||
Merck | COMT Inhibitor | Maximum | Development Milestone Commitment | ||||
Asset Acquisition And License Agreement [Line Items] | ||||
Potential Additional Milestone Commitment | $ 6,200,000 | |||
Lilly | CERC-501 | ||||
Asset Acquisition And License Agreement [Line Items] | ||||
Other Commitment | $ 250,000 | |||
Term of the study | 9 months | |||
Lilly | CERC-501 | Development Milestone Commitment | ||||
Asset Acquisition And License Agreement [Line Items] | ||||
Potential Additional Milestone Commitment | $ 19,000,000 | |||
Lilly | CERC-501 | Sales Milestone Commitment | ||||
Asset Acquisition And License Agreement [Line Items] | ||||
Potential Additional Milestone Commitment | $ 30,000,000 | |||
Lilly | CERC-501 | Royalty Commitment | ||||
Asset Acquisition And License Agreement [Line Items] | ||||
Term of royalty obligation | 11 years | |||
Lilly | CERC-501 | Research and development expense | ||||
Asset Acquisition And License Agreement [Line Items] | ||||
Asset acquisition payments | $ 750,000 |
Debt (Details)
Debt (Details) - USD ($) | Dec. 17, 2015 | Aug. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 16, 2015 | Oct. 20, 2015 |
Debt | ||||||
Term loan | $ 5,688,256 | $ 7,500,000 | ||||
Less: debt discount | (126,700) | (285,910) | ||||
Term Loan, net of debt discount | 5,561,556 | 7,214,090 | ||||
Less: current portion, net of debt discount | (3,208,074) | (1,905,879) | ||||
Long term debt, net of current portion and discount | 2,353,482 | 5,308,211 | ||||
Long-term Debt, Fiscal Year Maturity [Abstract] | ||||||
Term loan | $ 5,688,256 | 7,500,000 | ||||
Common stock warrants | ||||||
Long-term Debt, Fiscal Year Maturity [Abstract] | ||||||
Number of shares available under warrant | 40,000 | |||||
Term Loan, Long-Term [Member] | ||||||
Debt | ||||||
Face amount | $ 7,500,000 | |||||
Interest rate, maximum | 7.95% | |||||
Current interest rate | 8.20% | |||||
Term of interest-only period | 9 months | |||||
Monthly payments of principal and interest | $ 305,000 | $ 305,000 | ||||
Monthly payments of principal and interest, term | 27 months | |||||
Debt | ||||||
Term loan | $ 5,688,256 | |||||
Interest expense including amortization of discount and accrual of termination fee | 800,000 | 329,000 | ||||
Long-term Debt, Fiscal Year Maturity [Abstract] | ||||||
2,016 | 3,314,225 | |||||
2,017 | 2,374,031 | |||||
Term loan | 5,688,256 | |||||
Term Loan, Long-Term [Member] | Long-Term Debt Caption [Member] | ||||||
Long-term Debt, Fiscal Year Maturity [Abstract] | ||||||
Lender fees paid | 110,000 | |||||
One-time fee payable at maturity | $ 187,500 | |||||
Term Loan, Long-Term [Member] | Interest Expense [Member] | ||||||
Long-term Debt, Fiscal Year Maturity [Abstract] | ||||||
Amortization of debt discount | 159,210 | 68,861 | ||||
Accretion of one-time fee | 84,144 | $ 36,394 | ||||
Term Loan, Long-Term [Member] | Series B convertible preferred stock warrants | ||||||
Long-term Debt, Fiscal Year Maturity [Abstract] | ||||||
Number of shares available under warrant | 625,208 | |||||
Exercise price per share (in dollars per share) | $ 0.2999 | |||||
Exercisable term following an IPO | 5 years | |||||
One-time fee payable at maturity | $ 187,500 | |||||
Term Loan, Long-Term [Member] | Common stock warrants | ||||||
Long-term Debt, Fiscal Year Maturity [Abstract] | ||||||
Number of shares available under warrant | 22,328 | |||||
Exercise price per share (in dollars per share) | $ 8.40 | |||||
Term Loan, Long-Term [Member] | Prime rate | ||||||
Debt | ||||||
Debt Instrument, Interest Rate During Period | 7.95% | |||||
Margin on interest rate, deducted from basis | 3.25% | |||||
Debt Instrument, Interest Rate, Increase (Decrease) | 0.25% |
Capital Structure - Common Stoc
Capital Structure - Common Stock (Details) | Nov. 23, 2015USD ($)shares | Oct. 20, 2015USD ($)item$ / sharesshares | Sep. 01, 2015$ / shares | Oct. 31, 2015USD ($)$ / sharesshares | Dec. 31, 2015item$ / sharesshares | Dec. 31, 2014$ / sharesshares | Apr. 30, 2012$ / shares | Mar. 23, 2012$ / shares |
Common Stock | ||||||||
Number of classes of stock authorized to issue | item | 2 | |||||||
Number of capital stock authorized to issue | 205,000,000 | |||||||
Number of common stock authorized to issue | 200,000,000 | 230,000,000 | ||||||
Preferred Stock, Shares Authorized | 5,000,000 | 0 | ||||||
Common stock, par value | $ / shares | $ 0.001 | $ 0.001 | $ 0.001 | |||||
Preferred Stock, Par or Stated Value Per Share | $ / shares | $ 0.001 | |||||||
Common stock outstanding | 8,650,143 | 649,721 | ||||||
Preferred stock outstanding | 0 | 0 | ||||||
Reverse stock split ratio | 0.0357 | |||||||
IPO | Capital Unit | ||||||||
Initial Public Offering [Abstract] | ||||||||
Shares issued | 4,000,000 | 4,000,000 | ||||||
Share Price | $ / shares | $ 6.50 | $ 6.50 | ||||||
Gross proceeds | $ | $ 26,000,000 | $ 26,000,000 | ||||||
Net proceeds from IPO | $ | 23,600,000 | $ 23,600,000 | ||||||
Over-Allotment Option [Member] | ||||||||
Initial Public Offering [Abstract] | ||||||||
Gross proceeds | $ | $ 135,319 | |||||||
Underwriters Unit Purchase Option | Capital Unit | ||||||||
Underwriter's Unit Purchase Option [Abstract] | ||||||||
Proceeds from unit purchase option | $ | $ 100 | |||||||
Units available, as a percentage of units sold | 1.00% | |||||||
Equity purchase option unit, exercise price per unit | $ / shares | $ 7.48 | |||||||
Equity purchase option unit, exercise price as percent of IPO price | 115.00% | |||||||
Underwriters Unit Purchase Option | Capital Unit | Maximum | ||||||||
Underwriter's Unit Purchase Option [Abstract] | ||||||||
Number of units available under the option | 40,000 | |||||||
Class A Warrant [Member] | ||||||||
Initial Public Offering [Abstract] | ||||||||
Number of shares per warrant | 1 | |||||||
Exercise price per share (in dollars per share) | $ / shares | $ 4.55 | |||||||
Class A Warrant [Member] | IPO | ||||||||
Initial Public Offering [Abstract] | ||||||||
Number of Equity Instruments Included in a Unit | 1 | |||||||
Exercise price per share (in dollars per share) | $ / shares | $ 4.55 | |||||||
Class A Warrant [Member] | Over-Allotment Option [Member] | ||||||||
Initial Public Offering [Abstract] | ||||||||
Shares issued | 551,900 | |||||||
Class A Warrant [Member] | Underwriters Unit Purchase Option | ||||||||
Initial Public Offering [Abstract] | ||||||||
Exercise price per share (in dollars per share) | $ / shares | 5.23 | |||||||
Underwriter's Unit Purchase Option [Abstract] | ||||||||
Equity purchase option, unit exercise price after first warrant expiration | $ / shares | 7.475 | |||||||
Equity purchase option, unit exercise price after second warrant expiration | $ / shares | $ 7.47 | |||||||
Class B Warrant [Member] | ||||||||
Initial Public Offering [Abstract] | ||||||||
Number of shares per warrant | 0.5 | |||||||
Exercise price per share (in dollars per share) | $ / shares | $ 3.90 | |||||||
Class B Warrant [Member] | IPO | ||||||||
Initial Public Offering [Abstract] | ||||||||
Number of Equity Instruments Included in a Unit | 1 | |||||||
Exercise price per share (in dollars per share) | $ / shares | $ 3.90 | |||||||
Class B Warrant [Member] | Over-Allotment Option [Member] | ||||||||
Initial Public Offering [Abstract] | ||||||||
Shares issued | 551,900 | |||||||
Class B Warrant [Member] | Underwriters Unit Purchase Option | ||||||||
Initial Public Offering [Abstract] | ||||||||
Exercise price per share (in dollars per share) | $ / shares | $ 4.49 | |||||||
Common Stock [Member] | ||||||||
Common Stock | ||||||||
Number of Votes per Share | item | 1 | |||||||
Number of preemptive, conversion or subscription rights | item | 0 | |||||||
Number of redemption or sinking fund provisions | item | 0 | |||||||
Initial Public Offering [Abstract] | ||||||||
Exercise price per share (in dollars per share) | $ / shares | $ 28 | $ 28 | ||||||
Shares issued | 6,877 | |||||||
Common Stock [Member] | IPO | ||||||||
Initial Public Offering [Abstract] | ||||||||
Number of Equity Instruments Included in a Unit | 1 | |||||||
Common Stock [Member] | Over-Allotment Option [Member] | ||||||||
Initial Public Offering [Abstract] | ||||||||
Shares issued | 20,000 | |||||||
Common Stock [Member] | Class A Warrant [Member] | ||||||||
Initial Public Offering [Abstract] | ||||||||
Number of shares per warrant | 1 | |||||||
Common Stock [Member] | Class A Warrant [Member] | Over-Allotment Option [Member] | ||||||||
Initial Public Offering [Abstract] | ||||||||
Number of shares per warrant | 1 | |||||||
Common Stock [Member] | Class B Warrant [Member] | ||||||||
Initial Public Offering [Abstract] | ||||||||
Number of shares per warrant | 0.5 | |||||||
Common Stock [Member] | Class B Warrant [Member] | Over-Allotment Option [Member] | ||||||||
Initial Public Offering [Abstract] | ||||||||
Number of shares per warrant | 0.5 |
Capital Structure -Convertible
Capital Structure -Convertible Preferred stock (Details) | May. 18, 2012USD ($) | Mar. 23, 2012USD ($)$ / sharesshares | Oct. 31, 2015USD ($)shares | Aug. 31, 2014USD ($)$ / shares | Jul. 31, 2014USD ($)$ / sharesshares | Aug. 31, 2013USD ($)shares | Apr. 30, 2012USD ($)$ / sharesshares | Mar. 31, 2012USD ($)shares | Jun. 30, 2014USD ($)$ / sharesshares | Jun. 30, 2012item | Dec. 31, 2014USD ($)$ / sharesshares | Dec. 31, 2013USD ($)$ / sharesshares | Dec. 31, 2015shares | Oct. 20, 2015shares | Jan. 31, 2014$ / shares |
Class of Stock [Line Items] | |||||||||||||||
Debt converted | $ 100,000 | ||||||||||||||
Carrying value | $ 28,345,531 | ||||||||||||||
Investor rights obligation fair value | $ 1,112,000 | ||||||||||||||
Convertible promissory notes | |||||||||||||||
Class of Stock [Line Items] | |||||||||||||||
Debt converted | $ 3,000,000 | ||||||||||||||
Interest converted | $ 58,000 | ||||||||||||||
Common Stock [Member] | |||||||||||||||
Class of Stock [Line Items] | |||||||||||||||
Issuance of stock (in shares) | shares | 6,877 | ||||||||||||||
Number of shares available under warrant | shares | 80,966 | 225,869 | 7,400,934 | 22,328 | |||||||||||
Exercise price per share (in dollars per share) | $ / shares | $ 28 | $ 28 | |||||||||||||
Warrants issued upon conversion | shares | 36,406 | 1,190 | |||||||||||||
Fair value of common stock | $ 37,041 | ||||||||||||||
Common Stock [Member] | Placement Agent | |||||||||||||||
Class of Stock [Line Items] | |||||||||||||||
Number of shares available under warrant | shares | 126,091 | ||||||||||||||
Series A Convertible preferred stock | |||||||||||||||
Class of Stock [Line Items] | |||||||||||||||
Number of private placement closings | item | 3 | ||||||||||||||
Issuance of stock (in shares) | shares | 25,305,583 | ||||||||||||||
Share issued upon conversion | shares | 4,077,475 | 133,333 | |||||||||||||
Issuance of convertible preferred stock | $ 17,700,000 | ||||||||||||||
Conversion price | $ / shares | $ 0.60 | $ 0.75 | |||||||||||||
Fair value per share | $ / shares | $ 0.34 | ||||||||||||||
Gain on extinguishment of temporary equity | $ 9,393,746 | ||||||||||||||
Carrying value | 10,462,885 | $ 19,856,632 | |||||||||||||
Fair Value of preferred stock | $ 10,462,886 | ||||||||||||||
Series A-1 Convertible preferred stock | |||||||||||||||
Class of Stock [Line Items] | |||||||||||||||
Issuance of stock (in shares) | shares | 9,074,511 | ||||||||||||||
Issuance of convertible preferred stock | $ 6,567,064 | ||||||||||||||
Conversion price | $ / shares | $ 0.75 | $ 0.50 | |||||||||||||
Fair value per share | $ / shares | $ 0.37 | ||||||||||||||
Gain on extinguishment of temporary equity | $ 3,140,692 | ||||||||||||||
Carrying value | 3,389,331 | $ 1 | |||||||||||||
Fair Value of preferred stock | $ 3,389,330 | ||||||||||||||
Preferred stock dividend rate (as a percent) | 2.50% | ||||||||||||||
Unamortized beneficial conversion of preferred stock | $ 6,567,063 | ||||||||||||||
Series B convertible preferred stock | |||||||||||||||
Class of Stock [Line Items] | |||||||||||||||
Gross proceeds from issuance of preferred stock | $ 1,000,000 | $ 14,000,000 | |||||||||||||
Issuance of stock (in shares) | shares | 50,017,786 | ||||||||||||||
Share Price | $ / shares | $ 0.2999 | $ 0.2999 | |||||||||||||
Share issued upon conversion | shares | 3,333,331 | ||||||||||||||
Additional gross proceeds | $ 1,000,000 | ||||||||||||||
Issuance of convertible preferred stock | $ 3,334,445 | 46,684,455 | |||||||||||||
Conversion price | $ / shares | $ 0.2249 | ||||||||||||||
Carrying value | $ 14,493,315 | ||||||||||||||
Aggregate principle balance of the debt | 1,000,000 | ||||||||||||||
Investor rights obligation fair value | $ 2,600,000 | ||||||||||||||
Gain on change in fair value of investor rights obligation | $ 1,100,000 | ||||||||||||||
Series B convertible preferred stock | Convertible promissory notes | |||||||||||||||
Class of Stock [Line Items] | |||||||||||||||
Debt converted | $ 1,300,000 | ||||||||||||||
Share issued upon conversion | shares | 5,597,618 | ||||||||||||||
IPO | Common Stock [Member] | |||||||||||||||
Class of Stock [Line Items] | |||||||||||||||
Shares of common stock resulting from conversion of preferred stock (in shares) | shares | 3,980,422 | ||||||||||||||
IPO | Series A Convertible preferred stock | |||||||||||||||
Class of Stock [Line Items] | |||||||||||||||
Number of shares of common stock received for each converted share | shares | 0.04464 | ||||||||||||||
IPO | Series A-1 Convertible preferred stock | |||||||||||||||
Class of Stock [Line Items] | |||||||||||||||
Number of shares of common stock received for each converted share | shares | 0.05357 | ||||||||||||||
IPO | Series B convertible preferred stock | |||||||||||||||
Class of Stock [Line Items] | |||||||||||||||
Number of shares of common stock received for each converted share | shares | 0.03571 | ||||||||||||||
Private Placement | Series A Convertible preferred stock | |||||||||||||||
Class of Stock [Line Items] | |||||||||||||||
Gross proceeds from issuance of preferred stock | $ 1,200,000 | $ 19,000,000 | |||||||||||||
Private Placement | Series A-1 Convertible preferred stock | |||||||||||||||
Class of Stock [Line Items] | |||||||||||||||
Gross proceeds from issuance of preferred stock | $ 6,800,000 | ||||||||||||||
Issuance of stock (in shares) | shares | 9,074,511 | ||||||||||||||
Issuance of convertible preferred stock | $ 6,100,000 |
Capital Structure - Warrants (D
Capital Structure - Warrants (Details) - USD ($) $ / shares in Units, $ in Millions | Dec. 31, 2015 | Oct. 20, 2015 | Aug. 31, 2014 | Jul. 31, 2014 | Aug. 31, 2013 | Apr. 30, 2012 | Mar. 23, 2012 |
Series B convertible preferred stock | |||||||
Warrants | |||||||
Face amount | $ 1 | ||||||
Common Stock [Member] | |||||||
Warrants | |||||||
Number of shares underlying warrants | 7,400,934 | 22,328 | 80,966 | 225,869 | |||
Exercise price per share (in dollars per share) | $ 28 | $ 28 | |||||
Common stock warrants | |||||||
Warrants | |||||||
Number of shares underlying warrants | 40,000 | ||||||
Common stock warrants, expiration date of February 2017 | Common Stock [Member] | |||||||
Warrants | |||||||
Number of shares underlying warrants | 109,976 | ||||||
Exercise price per share (in dollars per share) | $ 28 | ||||||
Common stock warrants, expiration date of February 2017 | Common Stock [Member] | |||||||
Warrants | |||||||
Number of shares underlying warrants | 29,260 | ||||||
Exercise price per share (in dollars per share) | $ 14 | ||||||
Common stock warrants, expiration date of March 2017 | Common Stock [Member] | |||||||
Warrants | |||||||
Number of shares underlying warrants | 90,529 | ||||||
Exercise price per share (in dollars per share) | $ 28 | ||||||
Common stock warrants, expiration date of March 2017 | Common Stock [Member] | |||||||
Warrants | |||||||
Number of shares underlying warrants | 29,557 | ||||||
Exercise price per share (in dollars per share) | $ 14 | ||||||
Common stock warrants, expiration date of April 2017 | Common Stock [Member] | |||||||
Warrants | |||||||
Number of shares underlying warrants | 130,233 | ||||||
Exercise price per share (in dollars per share) | $ 28 | ||||||
Common stock warrants, expiration date of April 2017 | Common Stock [Member] | |||||||
Warrants | |||||||
Number of shares underlying warrants | 2,275,950 | ||||||
Exercise price per share (in dollars per share) | $ 3.90 | ||||||
Common stock warrants, expiration date of April 2017 | Common Stock [Member] | |||||||
Warrants | |||||||
Number of shares underlying warrants | 20,000 | ||||||
Exercise price per share (in dollars per share) | $ 4.49 | ||||||
Common stock warrants, expiration date of July 2017 | Common Stock [Member] | |||||||
Warrants | |||||||
Number of shares underlying warrants | 14,284 | ||||||
Exercise price per share (in dollars per share) | $ 28 | ||||||
Common stock warrants, expiration date of August 2018 | Common Stock [Member] | |||||||
Warrants | |||||||
Number of shares underlying warrants | 80,966 | ||||||
Exercise price per share (in dollars per share) | $ 28 | ||||||
Common stock warrants, expiration date of October 2018 | Common Stock [Member] | |||||||
Warrants | |||||||
Number of shares underlying warrants | 4,551,900 | ||||||
Exercise price per share (in dollars per share) | $ 4.55 | ||||||
Common stock warrants, expiration date of October 2018 | Common Stock [Member] | |||||||
Warrants | |||||||
Number of shares underlying warrants | 40,000 | ||||||
Exercise price per share (in dollars per share) | $ 5.23 | ||||||
Common stock warrants, expiration date of December 2018 | Common Stock [Member] | |||||||
Warrants | |||||||
Number of shares underlying warrants | 3,571 | ||||||
Exercise price per share (in dollars per share) | $ 28 | ||||||
Common stock warrants, expiration date of October 2020 | Common Stock [Member] | |||||||
Warrants | |||||||
Number of shares underlying warrants | 22,328 | ||||||
Exercise price per share (in dollars per share) | $ 8.40 | ||||||
Common stock warrants, expiration date of May 2022 | Common Stock [Member] | |||||||
Warrants | |||||||
Number of shares underlying warrants | 2,380 | ||||||
Exercise price per share (in dollars per share) | $ 8.68 | ||||||
Series B convertible preferred stock warrants | Series B convertible preferred stock | |||||||
Warrants | |||||||
Number of shares underlying warrants | 625,208 | ||||||
Exercise price per share (in dollars per share) | $ 0.2999 | ||||||
Series B convertible preferred stock warrants | Term loan | |||||||
Warrants | |||||||
Face amount | $ 7.5 |
Stock Based Compensation (Detai
Stock Based Compensation (Details) - USD ($) | Jun. 26, 2015 | May. 06, 2013 | Jan. 10, 2012 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Aug. 31, 2015 | Apr. 28, 2011 |
Total stock-based compensation | $ 394,748 | $ 1,086,581 | ||||||
Option Activity, Number of shares | ||||||||
Balance, beginning of period | 552,726 | 381,669 | ||||||
Granted | 523,390 | 177,484 | ||||||
Forfeitures | (116,928) | (6,427) | ||||||
Balance, end of period | 959,188 | 552,726 | 381,669 | |||||
Vested or expected to vest | 959,188 | |||||||
Exercisable | 604,167 | |||||||
Option Activity, Weighted-average exercise price | ||||||||
Beginning of period | $ 9.17 | $ 7.78 | ||||||
Granted | 6.31 | 12.14 | ||||||
Forfeitures | 8.60 | 8.68 | ||||||
End of period | 7.68 | $ 9.17 | $ 7.78 | |||||
Vested or expected to vest | 7.68 | |||||||
Exercisable | $ 8.51 | |||||||
Option Activity, Fair value of options granted | ||||||||
Granted | $ 1,467,886 | $ 389,538 | ||||||
Option Activity, Weighted-average remaining contractual term (in years) | ||||||||
Balance | 7 years 6 months 4 days | |||||||
Vested or expected to vest | 7 years 6 months 4 days | |||||||
Exercisable | 7 years 18 days | |||||||
Aggregate intrinsic value | $ 0 | |||||||
Fair value of options vested in period | $ 700,000 | $ 1,300,000 | $ 600,000 | |||||
Per share weighted average fair value of options granted | $ 2.80 | $ 2.24 | $ 5.60 | |||||
Fair value assumptions | ||||||||
Expected term of options (in years) | P6Y | |||||||
Expected stock price volatility | 70.00% | 70.00% | 70.00% | |||||
Expected annual dividend yield | 0.00% | 0.00% | 0.00% | |||||
Unrecognized compensation expense | ||||||||
2,016 | $ 273,913 | |||||||
2,017 | 262,426 | |||||||
2,018 | 246,094 | |||||||
2,019 | 118,457 | |||||||
Total unrecognized compensation expense | 900,890 | |||||||
Research and development expense | ||||||||
Total stock-based compensation | 67,021 | $ 201,653 | ||||||
General and administrative | ||||||||
Total stock-based compensation | $ 327,727 | $ 884,928 | ||||||
Minimum | ||||||||
Fair value assumptions | ||||||||
Risk-free interest rate | 1.64% | 0.85% | 0.85% | |||||
Expected term of options (in years) | P5Y | P5Y | ||||||
Maximum | ||||||||
Fair value assumptions | ||||||||
Risk-free interest rate | 1.97% | 1.97% | 1.90% | |||||
Expected term of options (in years) | P6Y3M | P6Y3M | ||||||
2011 stock incentive plan | ||||||||
Number of shares authorized for issuance | 704,428 | 178,571 | ||||||
Increase in number of shares reserved for issuance | 418,714 | 107,143 | ||||||
Common stock remaining for future issuance (in shares) | 0 | |||||||
2011 stock incentive plan | Stock Options | ||||||||
Options term (in years) | 10 years | |||||||
2011 stock incentive plan | Minimum | Stock Options | ||||||||
Vesting period | 3 years | |||||||
2011 stock incentive plan | Maximum | Stock Options | ||||||||
Vesting period | 4 years | |||||||
2015 Omnibus Plan [Member] | ||||||||
Number of shares authorized for issuance | 890,815 | |||||||
Common stock remaining for future issuance (in shares) | 696,736 | |||||||
Annual share reserve increase (as a percent) | 3.00% |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Operating Loss Carryforwards [Line Items] | ||
Material adjustment in unrecognized tax benefits | $ 0 | |
Unrecognized tax benefits | 0 | |
Unrecognized tax benefits interest and penalties accrued | 0 | |
Deferred tax assets: | ||
Net operating losses | 20,350,451 | $ 16,113,309 |
Research and development credits | 1,814,296 | 1,640,277 |
Deferred rent | 15,599 | 17,844 |
Accrued compensation | 438,351 | 31,060 |
Stock compensation | 1,500,520 | 1,349,899 |
Basis difference in tangible and intangible assets | 207,157 | 340,570 |
Total deferred tax assets | 24,326,374 | 19,492,959 |
Less valuation allowance | (24,326,374) | $ (19,492,959) |
Increase in valuation allowance | 4,800,000 | |
Federal | ||
Deferred tax assets: | ||
Research and development credits | 400,000 | |
Maryland | ||
Deferred tax assets: | ||
Research and development credits | 1,400,000 | |
Federal And Maryland | ||
Deferred tax assets: | ||
Net operating loss carryforwards | $ 51,600,000 |
Income Taxes - Expense (Details
Income Taxes - Expense (Details) | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Reconciliation of income tax expense | ||
Federal statutory rate | 34.00% | 34.00% |
Permanent differences | (0.02%) | (0.02%) |
Warrants | 4.26% | 4.80% |
State taxes | 5.12% | 7.22% |
Research and development credit | 2.69% | 2.75% |
Other | 0.03% | 0.15% |
Change in valuation allowance | (46.08%) | (48.90%) |
Effective income tax rate | 0.00% | 0.00% |
Commitments And Contingencies47
Commitments And Contingencies (Details) - USD ($) | 1 Months Ended | 12 Months Ended | |
Aug. 31, 2013 | Dec. 31, 2015 | Dec. 31, 2014 | |
Period for maintenance of health benefits, maximum (in years) | 1 year | ||
Period for exercise of stock option grants, maximum (in days) | 90 days | ||
Rent expense | $ 190,000 | $ 192,000 | |
Future lease obligation: | |||
2,016 | 151,068 | ||
2,017 | 154,845 | ||
2,018 | 158,716 | ||
Total | 464,629 | ||
Period of abatement | 3 months | ||
Research and Development Arrangement [Member] | Maximum | |||
Obligation for future services | 3,600,000 | ||
General and administrative | |||
Severance benefit under separation agreement | $ 527,500 |
Selected Quarterly Financial 48
Selected Quarterly Financial Data (Unaudited) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Quarterly Financial Data [Abstract] | |||||||||||
Research and development | $ 1,751,000 | $ 1,238,000 | $ 1,875,000 | $ 1,723,000 | $ 2,259,000 | $ 4,371,000 | $ 2,861,000 | $ 2,750,000 | $ 6,587,183 | $ 12,240,535 | $ 8,914,084 |
General and administrative | 1,924,000 | 722,000 | 1,016,000 | 761,000 | 1,575,000 | 1,627,000 | 794,000 | 879,000 | 4,422,764 | 4,875,030 | 4,020,364 |
Change in fair value of warrant liability, unit purchase option liability and investor rights obligation | 185,000 | 1,465,000 | 198,000 | (535,000) | 1,532,000 | 348,000 | 386,000 | 1,313,049 | 2,266,161 | (121,115) | |
Interest income (expense), net | (158,000) | (197,000) | (219,000) | (219,000) | (221,000) | (190,000) | (795,000) | 0 | (793,205) | (1,206,187) | 10,555 |
Net loss | (3,648,000) | (692,000) | (2,912,000) | (3,238,000) | (2,523,000) | (5,840,000) | (4,064,000) | (3,629,000) | (10,490,103) | (16,055,591) | (13,045,008) |
Net loss attributable to common stockholders | $ (3,648,000) | $ (692,000) | $ (2,912,000) | $ (3,238,000) | $ (2,523,000) | $ 6,695,000 | $ (4,064,000) | $ (3,629,000) | $ (10,490,103) | $ (3,521,153) | $ (13,126,972) |
Net loss per share of common stock, basic and diluted | $ (0.53) | $ (1.06) | $ (4.48) | $ (4.98) | $ (3.88) | $ 10.35 | $ (6.39) | $ (5.71) | $ (4.71) | $ (5.48) | $ (20.72) |