Soliton (SOLY) 10-Q 13 May 21 2020 Q3 Quarterly report Financial data

Cover Page

Cover Page - shares	3 Months Ended
	Mar. 31, 2021	May 05, 2021
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Mar. 31, 2021
Document Transition Report	false
Entity File Number	001-38815
Entity Registrant Name	Soliton, Inc.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	36-4729076
Entity Address, Address Line One	5304 Ashbrook Drive
Entity Address, City or Town	Houston
Entity Address, State or Province	TX
Entity Address, Postal Zip Code	77081
City Area Code	844
Local Phone Number	705-4866
Title of 12(b) Security	Common Stock
Trading Symbol	SOLY
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		21,378,830
Entity Central Index Key	0001548187
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q3
Amendment Flag	false

CONDENSED BALANCE SHEETS (UNAUD

CONDENSED BALANCE SHEETS (UNAUDITED) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Current assets:
Cash and cash equivalents	$ 26,052	$ 31,557
Restricted cash	200	200
Total cash	26,252	31,757
Inventory	599	353
Prepaid expenses and other current assets	729	141
Total current assets	27,580	32,251
Property and equipment, net of accumulated depreciation	1,832	1,413
Intangible and other assets	283	137
Total assets	29,695	33,801
Current liabilities:
Accounts payable	1,308	1,008
Accrued and other current liabilities	1,495	1,812
Total current liabilities	2,803	2,820
Commitments and contingencies (Note 4)
Stockholders’ equity:
Common stock, $0.001 par value, 100,000,000 authorized, 21,378,830 shares issued and outstanding at March 31, 2021 and 21,189,943 shares issued and outstanding at December 31, 2020	21	21
Additional paid-in capital	102,632	101,544
Accumulated deficit	(75,761)	(70,584)
Total stockholders’ equity	26,892	30,981
Total liabilities and stockholders’ equity	$ 29,695	$ 33,801

CONDENSED BALANCE SHEETS (UNA_2

CONDENSED BALANCE SHEETS (UNAUDITED) (Parenthetical) - $ / shares	Mar. 31, 2021	Dec. 31, 2020
Statement of Financial Position [Abstract]
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized (in shares)	100,000,000	100,000,000
Common stock, shares issued (in shares)	21,378,830	21,189,943
Common stock shares outstanding (in shares)	21,378,830	21,189,943

CONDENSED STATEMENTS OF OPERATI

CONDENSED STATEMENTS OF OPERATIONS (UNAUDITED) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Income Statement [Abstract]
Revenue	$ 0	$ 0
Operating expenses:
Research and development	1,456	1,142
Sales and marketing	711	51
Depreciation	91	71
General and administrative	2,972	2,011
Total operating expenses	5,230	3,275
Loss from operations	(5,230)	(3,275)
Other income:
Interest income	53	4
Total other income	53	4
Net loss	$ (5,177)	$ (3,271)
Net loss per common share, basic and diluted (in dollars per share)	$ (0.25)	$ (0.19)
Weighted average number of common shares outstanding, basic and diluted	21,121,024	16,781,210

CONDENSED STATEMENTS OF CHANGES

CONDENSED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (UNAUDITED) - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock	Additional Paid-In Capital	Accumulated Deficit
Balance (in shares) at Dec. 31, 2019		16,932
Balance at Dec. 31, 2019	$ 10,274	$ 17	$ 66,300	$ (56,043)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation	711		711
Issuance of common shares (in shares)		11
Net loss	(3,271)			(3,271)
Balance (in shares) at Mar. 31, 2020		16,943
Balance at Mar. 31, 2020	7,714	$ 17	67,011	(59,314)
Balance (in shares) at Dec. 31, 2020		21,190
Balance at Dec. 31, 2020	30,981	$ 21	101,544	(70,584)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation	1,036		1,036
Issuance of common shares (in shares)		189
Issuance of common shares	52		52
Net loss	(5,177)			(5,177)
Balance (in shares) at Mar. 31, 2021		21,379
Balance at Mar. 31, 2021	$ 26,892	$ 21	$ 102,632	$ (75,761)

CONDENSED STATEMENTS OF CASH FL

CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$ (5,177)	$ (3,271)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation	91	71
Stock-based compensation	1,036	711
Changes in operating assets - (increase)/decrease:
Inventory	(246)	0
Prepaid expenses and other current assets	(588)	(816)
Changes in operating liabilities - increase/(decrease):
Accounts payable	71	(349)
Accrued and other current liabilities	(317)	(667)
NET CASH USED IN OPERATING ACTIVITIES:	(5,130)	(4,321)
CASH FLOWS FROM INVESTING ACTIVITIES:
Payments for the purchase of property and equipment	(286)	(10)
Payments for intangibles	(141)	0
NET CASH USED IN INVESTING ACTIVITIES:	(427)	(10)
CASH FLOWS FROM FINANCING ACTIVITIES:
Gross proceeds from issuance of common stock	52	0
NET CASH PROVIDED BY FINANCING ACTIVITIES:	52	0
Net decrease in cash, cash equivalents and restricted cash	(5,505)	(4,331)
Cash, cash equivalents and restricted cash, beginning of period	31,757	12,076
Cash, cash equivalents and restricted cash, end of period	26,252	7,745
Non-cash investing and financing activities:
Additions to property and equipment included in accounts payable	223	0
Additions to intangible assets included in accounts payable	$ 5	$ 0

Description of the Business, Ba

Description of the Business, Basis of Presentation and Summary of Significant Accounting Policies	3 Months Ended
	Mar. 31, 2021
Accounting Policies [Abstract]
Description of the Business, Basis of Presentation and Summary of Significant Accounting Policies	Description of the Business, Basis of Presentation and Summary of Significant Accounting Policies Description of the Business Soliton, Inc. (“Soliton” or the “Company”) was organized under the laws of the State of Delaware on March 27, 2012. The Company operates in one segment as a medical device company organized to develop and commercialize products utilizing its proprietary Rapid Acoustic Pulse ("RAP") technology platform. The Company is a pre-revenue stage company with its first products being developed for the removal of tattoos and the reduction of cellulite. The Company received clearance from the U.S. Food & Drug Administration ("FDA") for its tattoo removal indication in June of 2019 and for the temporary improvement in the appearance of cellulite in January of 2021. The Company is based in Houston, Texas. Upon completion of the development of its products and regulatory clearances to market such products, the Company anticipates revenue will be driven by the sale of its RAP console and disposable cartridges to dermatologists, plastic surgeons and other physician offices, as well as medi-spas under the supervision of a doctor. Basis of Presentation The accompanying condensed interim financial statements are unaudited. These unaudited condensed interim financial statements have been prepared in accordance with the rules and regulations of the U.S. Securities and Exchange Commission ("SEC") for interim financial information. Accordingly, they do not include all the information and notes required by generally accepted accounting principles in the United States of America ("GAAP") for complete financial statements. These unaudited condensed interim financial statements should be read in conjunction with the audited financial statements and accompanying notes as found in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020 filed with the SEC on March 4, 2021. In the opinion of management, the unaudited condensed interim financial statements reflect all the adjustments (consisting of normal recurring adjustments) necessary to state fairly the Company’s financial position, results of operations and cash flows for the interim periods presented. The interim results of operations are not necessarily indicative of the results that may occur for the full fiscal year. The December 31, 2020 unaudited condensed balance sheet included herein was derived from the audited financial statements, but does not include all disclosures, including notes, required by GAAP for complete financial statements. Segments The Company operates in one reportable segment based on management’s view of its business for purposes of evaluating performance and making operating decisions. Use of Estimates in Financial Statement Presentation The preparation of these unaudited condensed interim financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. The Company's significant estimates and assumptions include work performed but not yet billed by contract manufacturers, engineers and research organizations, the valuation of equity related instruments, depreciable lives of long-lived assets (including property and equipment and intangible assets), and the valuation allowance related to deferred taxes. Although the Company believes that its estimates and assumptions are reasonable, they are based upon information available at the time the estimates and assumptions were made. Some of these judgments can be subjective and complex, and, consequently, actual results could differ from those estimates. The coronavirus disease (“COVID-19”) pandemic has negatively impacted, and may continue to negatively impact, the macroeconomic environment in the United States and globally, including our business, financial condition and results of operations. Due to the evolving and uncertain nature of COVID-19, it is reasonably possible that it could materially impact our estimates, particularly those that require consideration of forecasted financial information, in the near to medium term. These estimates relate to certain accounts including, but not limited to, the valuation allowance related to deferred taxes, intangible assets, and other long-lived assets. The magnitude of the impact will depend on numerous evolving factors that we may not be able to accurately predict, including the duration and extent of the pandemic, the impact of federal, state, local and foreign governmental actions, consumer and provider behavior in response to the pandemic and such governmental actions, and the economic and operating conditions that we may face in the aftermath of COVID-19. Material Uncertainties The Company is an early-stage Emerging Growth Company ("EGC") and has not generated any revenues to date. As such, the Company is subject to all of the risks associated with early stage and emerging growth companies. Since inception, the Company has incurred losses and negative cash flows from operating activities. For the three months ended March 31, 2021 and 2020, the Company incurred net losses of $5.2 million and $3.3 million, respectively, and had net cash flows used in operating activities for the three months ended March 31, 2021 and 2020 of $5.1 million and $4.3 million, respectively. At March 31, 2021, the Company had an accumulated deficit of $75.8 million, working capital of $24.8 million and cash, cash equivalents and restricted cash of $26.3 million. The Company does not expect to experience positive cash flows from operating activities in the near future and anticipates incurring operating losses for the next few years as it supports the commercial launch of its products and continues to invest in research and development for additional indications in the Company's pipeline. The Company expects its cash, cash equivalents and restricted cash on hand of $26.3 million as of March 31, 2021 will be sufficient to fund the Company's operations into the third quarter of 2022 but not beyond. These factors raise uncertainties about the Company's ability to fund operations in future years. If the Company needs additional capital or financing to continue to execute its business plan or a change to its business plan, including obtaining additional regulatory clearance for its products currently under development, and commercializing and generating revenues from products under development, there is no assurance that additional capital or financing will be available when needed or that management will be able to raise capital or obtain financing on terms acceptable to the Company. The accompanying financial statements do not include any adjustments to reflect this uncertainty. Net Loss per Common Share Basic net loss per common share is computed by dividing net loss available to common stockholders by the weighted-average number of common shares outstanding during the period. Diluted net loss per common share is determined using the weighted-average number of common shares outstanding during the period, adjusted for the dilutive effect of common stock equivalents. Unvested restricted stock awards contain dividend rights and are considered participating securities as contemplated for the computations of basic and diluted earnings or loss per share. These securities do not participate in losses and accordingly no such allocation has been made in the periods presented. In periods when losses are reported, the weighted-average number of common shares outstanding excludes common stock equivalents, because their inclusion would be anti-dilutive. As of March 31, 2021, potentially dilutive securities included options to purchase 3,920,925 common shares, warrants to purchase 1,114,608 common shares and unvested restricted stock of 295,846 shares. As of March 31, 2020, potentially dilutive securities included options to purchase 3,271,050 common shares, warrants to purchase 1,359,608 common shares and unvested restricted stock of 145,838 shares. Recent Accounting Standards In February 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2016-02, Leases (Topic 842) ("ASC 842"), which establishes a right-of-use (“ROU”) model requiring a lessee to recognize a ROU asset and a lease liability for all leases with terms greater than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. Given the Company's status as an EGC, the Company may adopt this ASU in accordance with the private company guidance which has deferred the effective date to years beginning after December 15, 2021, and interim periods with fiscal years beginning after December 15, 2022. The modified retrospective transition approach applies to leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. The Company has the option to instead apply the provisions at the effective date without adjusting the comparative periods presented. The Company is currently evaluating the impact of this guidance on its financial position, results of operations, and cash flows. In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes . This ASU is intended to simplify various aspects related to accounting for income taxes by removing certain exceptions to the general principles in Topic 740 and clarifying certain aspects of the current guidance to promote consistency among reporting entities. ASU 2019-12 is effective for annual periods beginning after December 15, 2020 and interim periods within those annual periods, with early adoption permitted. Most amendments within this ASU are required to be applied on a prospective basis, while certain amendments must be applied on a retrospective or modified retrospective basis. Given the Company's status as an EGC, the Company may adopt the amendments of this update for years beginning after December 15, 2021, and interim periods with fiscal years beginning after December 15, 2022. The Company does not believe that these or other recently issued effective standards, or standards issued but not yet effective, if adopted, would have a material effect on the accompanying financial statements. Reclassifications

Prepaid Expenses and Other Curr

Prepaid Expenses and Other Current Assets	3 Months Ended
	Mar. 31, 2021
Prepaid Expense and Other Assets, Current [Abstract]
Prepaid Expenses and Other Current Assets	Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consisted of the following ( in thousands ): March 31, December 31, Prepaid insurance $ 514 $ 49 Other prepaids and receivables 215 92 Total prepaid expenses and other current assets $ 729 $ 141 As of March 31, 2021, other prepaids and receivables largely included payments made to vendors for work that has not yet been completed, payments made as a result of listing requirements for public companies and prepaid software subscriptions.

Property and Equipment

Property and Equipment	3 Months Ended
	Mar. 31, 2021
Property, Plant and Equipment [Abstract]
Property and Equipment	Property and EquipmentAs of March 31, 2021 and December 31, 2020, the net carrying value of property and equipment was approximately $1.8 million and $1.4 million, respectively, and included $1.2 million and $0.7 million, respectively, in construction-in-process for equipment being built and software being developed but not yet placed into service.Depreciation expense for the three months ended March 31, 2021 and 2020 was $0.1 million and $0.1 million, respectively.

Commitments and Contingencies

Commitments and Contingencies	3 Months Ended
	Mar. 31, 2021
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Commitments and Contingencies On April 5, 2012, the Company entered into a Patent and Technology License Agreement with The University of Texas M.D. Anderson Cancer Center ("MD Anderson"). Pursuant to the agreement, the Company obtained a royalty-bearing, worldwide, exclusive license to intellectual property including patent rights related to the patents and technology the Company uses. Under the agreement, the Company pays a nonrefundable annual maintenance fee which escalates each anniversary and is currently in the mid-five digits. Additionally, the Company agreed to a running royalty percentage of net sales in the mid-single digits. The specific patents initially subject to the agreement expire between 2031 and 2032. All out-of-pocket expenses incurred by MD Anderson in filing, prosecuting and maintaining the licensed patents have been and shall continue to be assumed by the Company. For the three months ended March 31, 2021 and 2020, the Company paid approximately $0.1 million and $0.1 million, respectively, for expenses related to this agreement. As the inventor of the intellectual property licensed from MD Anderson, Dr. Capelli, the Company's Vice Chairman, Chief Science Officer and Co-Founder, is entitled to 50% of the license income (which is determined after MD Anderson recoups any costs associated therewith) that the Company is required to pay to MD Anderson pursuant to the Company's license agreement with MD Anderson. For the three months ended March 31, 2021, Dr. Capelli was entitled to receive $42.5 thousand from MD Anderson. In addition, Dr. Capelli is entitled to 50% of the proceeds (after the recoupment of any costs associated therewith) from the sale by MD Anderson of 175,000 shares issued to MD Anderson in connection with the license agreement. Purchase Commitments As of March 31, 2021, the Company had contractual purchase obligations for engineering and design services of $2.0 million to Emphysys, Inc. ("Emphysys"). This commitment is for services used in the ordinary course of business and does not represent excess commitments or loss contracts. The remaining minimum purchase obligations are $0.4 million and $1.6 million, respectively, for the 12 month periods ending June 30, 2021 and June 30, 2022. If we fail to spend such minimum annual amounts or if the Company terminates the addendum without cause, the Company will be required to pay Emphysys an early termination fee of no more than $0.4 million. On March 6, 2020, the Company entered into a manufacturing service agreement (the "Agreement") with Sanmina Corporation ("Sanmina"). The Agreement states that Sanmina will provide the Company with certain manufactured products for a one year period, with pricing adjusted for material variations of market prices for components, parts and raw material, including variations resulting from allocations, shortages or tariffs. In addition, pricing will be based on the forecasted volumes provided by the Company and the projected inventory turns as agreed by both parties. Either party may terminate the Agreement or an order under the Agreement for default, if the other party materially breaches the Agreement; provided, however, no termination shall occur until thirty days after the defaulting party is notified in writing of the material breach and has failed to cure or give adequate assurances of performance within the thirty day period after notice of material breach. In addition, the Company may terminate the Agreement for any reason upon thirty days’ prior written notice and may terminate any order under the Agreement for any reason upon 120 days’ (before scheduled shipment) prior written notice. Sanmina may terminate the Agreement for any reason upon ninety days’ notice. In the event the Agreement or an order under the Agreement is terminated for any reason other than a breach by Sanmina, the Company is required to pay Sanmina termination charges equal to (i) the contract price for all finished product existing at the time of termination; (ii) Sanmina’s cost (including labor, components and applicable mark-ups per the pricing model) for all work in process; and (iii) the cost of components ordered by Sanmina pursuant to the Agreement. Lease Commitments The Company leases space for its corporate office, which provides for an original 63 month term beginning on February 1, 2016, with initial rent payments of $7.6 thousand per month that escalate annually to a maximum of $8.9 thousand per month through the expiration of the agreement. On September 15, 2020, the Company entered into a 12 month extension of its corporate office lease. Total rent expense under this office space lease arrangement for each of the three months ended March 31, 2021 and 2020 was $23.6 thousand. Future minimum lease payments as of March 31, 2021 was $0.1 million through the lease term ending April 30, 2022. Letters of Credit The Company has an irrevocable letter of credit which supports its obligations to pay or perform according to the requirements of an underlying agreement with a certain vendor. Such letter of credit has an initial term of one year, renews automatically for an additional year and can only be modified or canceled with the approval of the beneficiary. As of March 31, 2021, the letter of credit was not used. Legal Proceedings In the normal course of business, from time-to-time, the Company may be subject to claims in legal proceedings. However, the Company does not believe it is currently a party to any pending legal actions. Notwithstanding, legal proceedings are subject to inherent uncertainties and an unfavorable outcome could include monetary damages, and in such event, could result in a material adverse impact on the Company's business, financial position, results of operations or cash flows. Employment Arrangements The Company has agreements with certain employees to provide benefits, including salary and other wage-related benefits, in the event of termination. In addition, the Company has adopted a severance policy for certain key members of executive management to provide certain benefits, including salary and other wage-related benefits, in the event of termination without cause. In total, these benefits would amount to $3.6 million using the rate of compensation in effect at March 31, 2021.

Stockholders_ Equity

Stockholders’ Equity	3 Months Ended
	Mar. 31, 2021
Equity [Abstract]
Stockholders’ Equity	Stockholders’ Equity 2018 Stock Plan In June 2018, the Company’s Board of Directors (the "Board") and stockholders adopted the 2018 Stock Plan. The 2018 Stock Plan is designed to enable the Company to offer employees, officers, directors and consultants, as defined, an opportunity to acquire a proprietary interest in the Company. The types of awards that may be granted under the 2018 Stock Plan include stock options, stock appreciation rights, restricted stock, and other stock-based awards subject to limitations under applicable law. All awards are subject to approval by the Company’s Board. The 2018 Stock Plan reserves shares of common stock for issuance in accordance with the 2018 Stock Plan’s terms. Total number of shares reserved and available for issuance under the plan was 4,150,000 shares as of March 31, 2021. As of March 31, 2021, 47,800 shares remained available for grant under the 2018 Stock Plan prior to the approved increase to the pool of 1,500,000 shares, which was approved by the Company's shareholders at the annual shareholders meeting in April 2021. Restricted Stock Restricted stock activity for the three months ended March 31, 2021 is summarized as follows: Number of Weighted- Outstanding, December 31, 2020 308,344 $ 8.70 Vested (12,498) 11.54 Outstanding, March 31, 2021 295,846 $ 8.58 During the three months ended March 31, 2021 and 2020, the Company recorded $0.2 million and $0.1 million, respectively, in stock-based compensation for the restricted shares previously issued. As of March 31, 2021, there was $1.3 million of unrecognized compensation expense related to restricted shares. Stock Options The following table summarizes stock option activities for the three months ended March 31, 2021: Number of Weighted Weighted Aggregate Intrinsic Value (i n thousands ) Outstanding, December 31, 2020 3,919,550 $ 4.47 8.11 $ 13,095 Granted 66,300 9.74 — — Forfeited (64,925) $ 4.37 Outstanding, March 31, 2021 3,920,925 $ 4.56 7.91 $ 47,601 Exercisable, March 31, 2021 1,723,350 $ 2.98 7.43 $ 23,642 During the three months ended March 31, 2021, the Company granted certain individuals options to purchase 66,300 shares of common stock with an average exercise price of $9.74 per share, with a contractual term of ten years, and a vesting period of 25.00% per year over four years. The options have an aggregate grant date fair value of $0.5 million that was calculated using the Black-Scholes option pricing model. Variables used in the Black-Scholes option pricing model include: (1) discount rate of 0.19% based on the daily yield curve rates for U.S. Treasury obligations, (2) expected life of 6.25 years based on the simplified method (vesting plus contractual term divided by two), (3) expected volatility of 88.90% based on the historical volatility of comparable companies' stock, (4) no expected dividends and (5) fair value of the Company's stock of $9.74 per share. All options issued and outstanding are being amortized over their respective vesting periods. During the three months ended March 31, 2021 and 2020, the Company recorded option expense of $0.8 million and $0.6 million, respectively. Warrants The following table summarizes warrant activity for the three months ended March 31, 2021: Number of Weighted Weighted Aggregate Intrinsic Value ( in thousands ) Outstanding, December 31, 2020 1,324,608 $ 11.32 3.70 $ — Granted — — — — Exercised (188,887) 1.75 — 248 Forfeited (cashless exercise) (21,113) 1.75 — — Outstanding, March 31, 2021 1,114,608 $ 13.12 3.31 $ 3,989 Exercisable, March 31, 2021 1,114,608 $ 13.12 3.31 $ 3,989

Subsequent Events

Subsequent Events	3 Months Ended
	Mar. 31, 2021
Subsequent Events [Abstract]
Subsequent Events	Subsequent Events Certain Option Grants On January 21, 2021, the Company granted certain individuals options to purchase 345,350 shares of common stock, subject to shareholder approval at the Company's Annual Shareholder Meeting held on April 15, 2021. Shareholders approved the increase in the option pool on April 15, 2021. The options have an average exercise price of $9.74 per share, with a contractual term of 10 years, and a vesting period of 25.00% per year over 4 years. The options have an aggregate grant date fair value of $2.5 million that was calculated using the Black-Scholes option pricing model. Variables used in the Black-Scholes option pricing model include: (1) discount rate of 1.03% based on the daily yield curve rates for U.S. Treasury obligations, (2) expected life of 6.25 years based on the simplified method (vesting plus contractual term divided by two), (3) expected volatility of 90.77% based on the historical volatility of comparable companies' stock, (4) no expected dividends and (5) fair value of the Company's stock of $16.47 per share. FDA Approval of Generation 2.2 Device On April 28, 2021, the FDA notified the Company that it had deemed our Generation 2.2 device substantially equivalent and cleared the technology to be marketed for previously approved indications. Merger Agreement On May 8, 2021, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”) with AbbVie Inc. (“AbbVie”) and Scout Merger Sub, Inc., a wholly owned subsidiary of AbbVie (“Merger Sub”), under which Merger Sub will merge with and into the Company, with the Company continuing as the surviving corporation and a wholly-owned subsidiary of AbbVie (the “Merger”). Upon the closing of the Merger, each outstanding share of Company common stock, other than shares owned by the Company, AbbVie or Merger Sub (which will be cancelled) and shares with respect to which appraisal rights are properly exercised and not withdrawn under Delaware law, will automatically be converted into the right to receive $22.60 in cash, without interest (the “Merger Consideration”). Each stock option outstanding and unexercised immediately prior to the effective time of the Merger (the “Effective Time”) will be converted into the right to receive a cash payment, without interest, in an amount equal to the excess of the Merger Consideration over the per share exercise price that would be due in cash upon exercise of such stock option. Each restricted stock unit award outstanding immediately prior to the Effective Time will be converted into the right to receive a cash payment, without interest, in an amount equal to the Merger Consideration. Each warrant to purchase Company common stock outstanding and unexercised immediately prior to the Effective Time will be converted into the right to receive a cash payment, without interest, in an amount equal to the excess of (i) the number of shares of common stock subject to the warrant, multiplied by the Merger Consideration over (ii) the number of shares of common stock subject to the warrant, multiplied by the per share exercise price of such warrant. The consummation of the Merger is subject to certain customary closing conditions, including (i) the adoption of the Merger Agreement by the holders of a majority of the outstanding shares of the Company’s common stock (the “Stockholder Approval”), (ii) the expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the “HSR Act”), and (iii) that no judgment or law is in effect that enjoins, makes illegal or otherwise prohibits the consummation of the Merger. Moreover, each party’s obligations to consummate the Merger are subject to certain other conditions, including (a) the accuracy of the other party’s representations and warranties (subject to certain materiality exceptions), (b) the other party’s compliance in all material respects with its obligations under the Merger Agreement, and (c) in the case of AbbVie and Merger Sub only, (i) the absence of any pending claim, proceeding or other action by a governmental authority that seeks to prevent, prohibit or make illegal the consummation of the Merger or materially limit AbbVie’s ability to own, control, direct, manage or operate the Company and (ii) the absence of any effect, change, event, development or occurrence that, individually or in the aggregate, has had or would reasonably be expected to have a Material Adverse Effect (as defined in the Merger Agreement) that is continuing. Subject to the satisfaction of the closing conditions, closing of the Merger is expected to occur in the second half of 2021. The Merger Agreement contains representations and warranties and covenants of the parties customary for a transaction of this nature. Until the earlier of the termination of the Merger Agreement and the Effective Time, the Company has agreed to operate its business in the ordinary course of business in all material respects and has agreed to certain other operating covenants and to not take certain specified actions prior to the consummation of the Merger, as set forth more fully in the Merger Agreement. The Company has also agreed to convene and hold a meeting of its stockholders for the purpose of obtaining the Stockholder Approval. In addition, the Merger Agreement requires that, subject to certain exceptions, the Board recommend that the Company’s stockholders approve the Merger Agreement. The Merger Agreement contains certain termination rights for the Company and AbbVie, including, among others, the right of (1) the Company to terminate the Merger Agreement in order to enter into an agreement providing for a Superior Proposal (subject to the Company’s compliance with certain obligations under the Merger Agreement related to such Superior Proposal and such termination) and (2) AbbVie to terminate the Merger Agreement if the Board changes its recommendation with respect to the Merger Agreement. The Merger Agreement also provides that under specified circumstances, including in the event of termination as described in (1) or (2) above, the Company will be required to pay AbbVie a termination fee of $18,625,000. In connection with a termination of the Merger Agreement under specified circumstances involving failure to obtain clearance under the HSR Act to consummate the Merger (or failure to remove certain legal restraints, or to resolve certain pending claims or proceedings, arising under antitrust laws with respect to the Merger) within six months from the date of the Merger Agreement, subject to two extensions of three months each (provided other closing conditions are satisfied), or involving a non-appealable legal restraint of the Merger arising under antitrust laws, AbbVie may be required to pay the Company a reverse termination fee of up to $20,000,000.

Description of the Business, _2

Description of the Business, Basis of Presentation and Summary of Significant Accounting Policies (Policies)	3 Months Ended
	Mar. 31, 2021
Accounting Policies [Abstract]
Basis of Presentation	Basis of Presentation The accompanying condensed interim financial statements are unaudited. These unaudited condensed interim financial statements have been prepared in accordance with the rules and regulations of the U.S. Securities and Exchange Commission ("SEC") for interim financial information. Accordingly, they do not include all the information and notes required by generally accepted accounting principles in the United States of America ("GAAP") for complete financial statements. These unaudited condensed interim financial statements should be read in conjunction with the audited financial statements and accompanying notes as found in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020 filed with the SEC on March 4, 2021. In the opinion of management, the unaudited condensed interim financial statements reflect all the adjustments (consisting of normal recurring adjustments) necessary to state fairly the Company’s financial position, results of operations and cash flows for the interim periods presented. The interim results of operations are not necessarily indicative of the results that may occur for the full fiscal year. The December 31, 2020 unaudited condensed balance sheet included herein was derived from the audited financial statements, but does not include all disclosures, including notes, required by GAAP for complete financial statements.
Segments	Segments The Company operates in one reportable segment based on management’s view of its business for purposes of evaluating performance and making operating decisions.
Use of Estimates in Financial Statement Presentation	Use of Estimates in Financial Statement Presentation The preparation of these unaudited condensed interim financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. The Company's significant estimates and assumptions include work performed but not yet billed by contract manufacturers, engineers and research organizations, the valuation of equity related instruments, depreciable lives of long-lived assets (including property and equipment and intangible assets), and the valuation allowance related to deferred taxes. Although the Company believes that its estimates and assumptions are reasonable, they are based upon information available at the time the estimates and assumptions were made. Some of these judgments can be subjective and complex, and, consequently, actual results could differ from those estimates. The coronavirus disease (“COVID-19”) pandemic has negatively impacted, and may continue to negatively impact, the macroeconomic environment in the United States and globally, including our business, financial condition and results of operations. Due to the evolving and uncertain nature of COVID-19, it is reasonably possible that it could materially impact our estimates, particularly those that require consideration of forecasted financial information, in the near to medium term. These estimates relate to certain accounts including, but not limited to, the valuation allowance related to deferred taxes, intangible assets, and other long-lived assets. The magnitude of the impact will depend on numerous evolving factors that we may not be able to accurately predict, including the duration and extent of the pandemic, the impact of federal, state, local and foreign governmental actions, consumer and provider behavior in response to the pandemic and such governmental actions, and the economic and operating conditions that we may face in the aftermath of COVID-19.
Material Uncertainties	Material Uncertainties The Company is an early-stage Emerging Growth Company ("EGC") and has not generated any revenues to date. As such, the Company is subject to all of the risks associated with early stage and emerging growth companies. Since inception, the Company has incurred losses and negative cash flows from operating activities. For the three months ended March 31, 2021 and 2020, the Company incurred net losses of $5.2 million and $3.3 million, respectively, and had net cash flows used in operating activities for the three months ended March 31, 2021 and 2020 of $5.1 million and $4.3 million, respectively. At March 31, 2021, the Company had an accumulated deficit of $75.8 million, working capital of $24.8 million and cash, cash equivalents and restricted cash of $26.3 million. The Company does not expect to experience positive cash flows from operating activities in the near future and anticipates incurring operating losses for the next few years as it supports the commercial launch of its products and continues to invest in research and development for additional indications in the Company's pipeline. The Company expects its cash, cash equivalents and restricted cash on hand of $26.3 million as of March 31, 2021 will be sufficient to fund the Company's operations into the third quarter of 2022 but not beyond. These factors raise uncertainties about the Company's ability to fund operations in future years. If the Company needs additional capital or financing to continue to execute its business plan or a change to its business plan, including obtaining additional regulatory clearance for its products currently under development, and commercializing and generating revenues from products under development, there is no assurance that additional capital or financing will be available when needed or that management will be able to raise capital or obtain financing on terms acceptable to the Company. The accompanying financial statements do not include any adjustments to reflect this uncertainty.
Net Loss per Common Share	Net Loss per Common Share Basic net loss per common share is computed by dividing net loss available to common stockholders by the weighted-average number of common shares outstanding during the period. Diluted net loss per common share is determined using the weighted-average number of common shares outstanding during the period, adjusted for the dilutive effect of common stock equivalents. Unvested restricted stock awards contain dividend rights and are considered participating securities as contemplated for the computations of basic and diluted earnings or loss per share. These securities do not participate in losses and accordingly no such allocation has been made in the periods presented. In periods when losses are reported, the weighted-average number of common shares outstanding excludes common stock equivalents, because their inclusion would be anti-dilutive. As of March 31, 2021, potentially dilutive securities included options to purchase 3,920,925 common shares, warrants to purchase 1,114,608 common shares and unvested restricted stock of 295,846 shares. As of March 31, 2020, potentially dilutive securities included options to purchase 3,271,050 common shares, warrants to purchase 1,359,608 common shares and unvested restricted stock of 145,838 shares.
Recent Accounting Standards	Recent Accounting Standards In February 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2016-02, Leases (Topic 842) ("ASC 842"), which establishes a right-of-use (“ROU”) model requiring a lessee to recognize a ROU asset and a lease liability for all leases with terms greater than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. Given the Company's status as an EGC, the Company may adopt this ASU in accordance with the private company guidance which has deferred the effective date to years beginning after December 15, 2021, and interim periods with fiscal years beginning after December 15, 2022. The modified retrospective transition approach applies to leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. The Company has the option to instead apply the provisions at the effective date without adjusting the comparative periods presented. The Company is currently evaluating the impact of this guidance on its financial position, results of operations, and cash flows. In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes . This ASU is intended to simplify various aspects related to accounting for income taxes by removing certain exceptions to the general principles in Topic 740 and clarifying certain aspects of the current guidance to promote consistency among reporting entities. ASU 2019-12 is effective for annual periods beginning after December 15, 2020 and interim periods within those annual periods, with early adoption permitted. Most amendments within this ASU are required to be applied on a prospective basis, while certain amendments must be applied on a retrospective or modified retrospective basis. Given the Company's status as an EGC, the Company may adopt the amendments of this update for years beginning after December 15, 2021, and interim periods with fiscal years beginning after December 15, 2022. The Company does not believe that these or other recently issued effective standards, or standards issued but not yet effective, if adopted, would have a material effect on the accompanying financial statements.
Reclassifications	ReclassificationsIn certain instances, amounts reported in prior years' financial statements have been reclassified to conform to the current financial statement presentation. Such reclassifications had an effect on previously reported expenses between general and administrative and research and development.

Prepaid Expenses and Other Cu_2

Prepaid Expenses and Other Current Assets (Tables)	3 Months Ended
	Mar. 31, 2021
Prepaid Expense and Other Assets, Current [Abstract]
Summary of Prepaid Expenses and Other Current Assets	Prepaid expenses and other current assets consisted of the following ( in thousands ): March 31, December 31, Prepaid insurance $ 514 $ 49 Other prepaids and receivables 215 92 Total prepaid expenses and other current assets $ 729 $ 141

Stockholders_ Equity (Tables)

Stockholders’ Equity (Tables)	3 Months Ended
	Mar. 31, 2021
Equity [Abstract]
Nonvested Restricted Stock Shares Activity	Restricted stock activity for the three months ended March 31, 2021 is summarized as follows: Number of Weighted- Outstanding, December 31, 2020 308,344 $ 8.70 Vested (12,498) 11.54 Outstanding, March 31, 2021 295,846 $ 8.58
Stock Option Activity	The following table summarizes stock option activities for the three months ended March 31, 2021: Number of Weighted Weighted Aggregate Intrinsic Value (i n thousands ) Outstanding, December 31, 2020 3,919,550 $ 4.47 8.11 $ 13,095 Granted 66,300 9.74 — — Forfeited (64,925) $ 4.37 Outstanding, March 31, 2021 3,920,925 $ 4.56 7.91 $ 47,601 Exercisable, March 31, 2021 1,723,350 $ 2.98 7.43 $ 23,642
Warrants Activity	The following table summarizes warrant activity for the three months ended March 31, 2021: Number of Weighted Weighted Aggregate Intrinsic Value ( in thousands ) Outstanding, December 31, 2020 1,324,608 $ 11.32 3.70 $ — Granted — — — — Exercised (188,887) 1.75 — 248 Forfeited (cashless exercise) (21,113) 1.75 — — Outstanding, March 31, 2021 1,114,608 $ 13.12 3.31 $ 3,989 Exercisable, March 31, 2021 1,114,608 $ 13.12 3.31 $ 3,989

Description of the Business, _3

Description of the Business, Basis of Presentation and Summary of Significant Accounting Policies (Details Textual) $ in Thousands	3 Months Ended
	Mar. 31, 2021USD ($)segmentshares	Mar. 31, 2020USD ($)shares	Dec. 31, 2020USD ($)
Accounting Policies [Abstract]
Number of operating segments | segment	1
Number of reportable segments | segment	1
Net loss	$ (5,177)	$ (3,271)
Net cash used in operating activities	(5,130)	$ (4,321)
Accumulated deficit	(75,761)		$ (70,584)
Working capital	24,800
Cash balance	$ 26,300
Amount of options to purchase (in shares) | shares	3,920,925	3,271,050
Amount of warrants to purchase (in shares) | shares	1,114,608	1,359,608
Amount of unvested restricted stock (in shares) | shares	295,846	145,838

Prepaid Expenses and Other Cu_3

Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands	Mar. 31, 2021	Dec. 31, 2020
Prepaid Expense and Other Assets, Current [Abstract]
Prepaid insurance	$ 514	$ 49
Other prepaids and receivables	215	92
Total prepaid expenses and other current assets	$ 729	$ 141

Property and Equipment - Narrat

Property and Equipment - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020	Dec. 31, 2020
Property, Plant and Equipment [Line Items]
Property and equipment, net of accumulated depreciation	$ 1,832		$ 1,413
Depreciation	91	$ 71
Construction in Progress
Property, Plant and Equipment [Line Items]
Property and equipment, net of accumulated depreciation	$ 1,200		$ 700

Commitments and Contingencies -

Commitments and Contingencies - Narrative (Details) - USD ($)	Sep. 15, 2020	Feb. 01, 2016	Mar. 31, 2021	Mar. 31, 2020	Nov. 20, 2019
Other Commitments [Line Items]
Percentage of license income entitlement			50.00%
Purchase obligations			$ 2,000,000
Purchase obligation, due June 2021			400,000
Purchase obligation, due June 2022			1,600,000
Penalty payment					$ 400,000
Term of extension	12 months
Future minimum lease payments			100,000
Postemployment benefits liability			3,600,000
Office Space Lease Arrangement
Other Commitments [Line Items]
Term of contract		63 months
Rent expense			23,600	$ 23,600
Office Space Lease Arrangement | Minimum
Other Commitments [Line Items]
Monthly payments for rent		$ 7,600
Office Space Lease Arrangement | Maximum
Other Commitments [Line Items]
Monthly payments for rent		$ 8,900
MD Anderson
Other Commitments [Line Items]
Expenses from transactions with related party			100,000	$ 100,000
Amount owed from related parties			$ 42,500
Issuance of shares during period, new issues (in shares)			175,000

Stockholders_ Equity (Details T

Stockholders’ Equity (Details Textual) - USD ($)	Jan. 21, 2021	Apr. 30, 2021	Mar. 31, 2021	Mar. 31, 2020	Dec. 31, 2020
Granted (in shares)			66,300
Grants in period, weighted average exercise price (in dollars per share)			$ 9.74
Fair value assumptions, expected dividend payments	$ 0
Restricted Stock
Shares vested in period (in shares)			12,498
Unvested shares remaining (in shares)			295,846		308,344
Stock-based compensation expense			$ 200,000	$ 100,000
Unamortized expense remaining			1,300,000
Share-based Payment Arrangement, Option
Award vesting period	4 years
Stock-based compensation expense			800,000	$ 600,000
Expiration term period	10 years
Award vesting rights, percentage	25.00%
Aggregate grant date fair value	$ 2,500,000		500,000
Fair value assumptions, expected term	6 years 3 months
Fair value assumptions, expected volatility rate	90.77%
Fair value assumptions, expected dividend payments			$ 0
Share price (in dollars per share)	$ 16.47
Share-based Payment Arrangement, Option | Maximum
Expiration term period			10 years
Fair value assumptions discount rate			0.19%
Fair value assumptions, expected term			6 years 3 months
Fair value assumptions, expected volatility rate			88.90%
Share price (in dollars per share)			$ 9.74
Share-based Payment Arrangement, Option | Share-based Payment Arrangement, Tranche One | Maximum
Award vesting rights, percentage			25.00%
Share-based Payment Arrangement, Option | Share-based Payment Arrangement, Tranche Two | Maximum
Award vesting period			4 years
Certain Individuals
Granted (in shares)	345,350		66,300
Grants in period, weighted average exercise price (in dollars per share)	$ 9.74		$ 9.74
2018 Stock Plan
Common stock, capital shares reserved for future issuance (in shares)			4,150,000
Number of shares remaining (in shares)			47,800
2018 Stock Plan | Subsequent Event
Share pool increase		1,500,000

Stockholders_ Equity - Restrict

Stockholders’ Equity - Restricted Stock (Details) - Restricted Stock	3 Months Ended
	Mar. 31, 2021$ / sharesshares
Number of Shares
Outstanding beginning of period (in shares) | shares	308,344
Vested (in shares) | shares	(12,498)
Outstanding end of period (in shares) | shares	295,846
Weighted- Average Grant Date Fair Value
Outstanding beginning of period (in dollars per share) | $ / shares	$ 8.70
Vested (in dollars per share) | $ / shares	11.54
Outstanding end of period (in dollars per share) | $ / shares	$ 8.58

Stockholders_ Equity - Stock Op

Stockholders’ Equity - Stock Options (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2021	Dec. 31, 2020
Number of Shares
Outstanding (in shares)	3,919,550
Granted (in shares)	66,300
Forfeited (in shares)	(64,925)
Outstanding (in shares)	3,920,925	3,919,550
Exercisable (in shares)	1,723,350
Weighted Average Exercise Price
Outstanding, Weighted Average Exercise Price (in dollars per share)	$ 4.47
Granted (in dollars per share)	9.74
Forfeited (in dollars per share)	4.37
Outstanding, Weighted Average Exercise Price (in dollars per share)	4.56	$ 4.47
Exercisable (in dollars per share)	$ 2.98
Outstanding, Weighted Average Remaining Life (Year)	7 years 10 months 28 days	8 years 1 month 9 days
Exercisable, Weighted Average Remaining Life (Year)	7 years 5 months 4 days
Outstanding, Aggregate Intrinsic Value	$ 47,601	$ 13,095
Exercisable, Aggregate Intrinsic Value	$ 23,642

Stockholders_ Equity - Warrants

Stockholders’ Equity - Warrants (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2021	Dec. 31, 2020
Number of Shares
Warrants Outstanding beginning balance (in shares)	1,324,608
Warrants Granted (in shares)	0
Warrants Exercised (in shares)	(188,887)
Warrant forfeited (cashless exercise), shares (in shares)	(21,113)
Warrants Outstanding ending balance (in shares)	1,114,608	1,324,608
Warrants Exercisable (in shares)	1,114,608
Weighted- Average Grant Date Fair Value
Warrants Outstanding, Weighted Average Exercise Price (in dollars per share)	$ 11.32
Warrants Granted, Weighted Average Exercise Price (in dollars per share)	0
Warrants Exercised, Weighted Average Exercise Price (in dollars per share)	1.75
Warrants Forfeited (cashless exercise), Weighted Average Exercise Price (in dollars per share)	1.75
Warrants Outstanding, Weighted Average Exercise Price (in dollars per share)	13.12	$ 11.32
Warrants Exercisable, Weighted Average Exercise Price (in dollars per share)	$ 13.12
Warrants Outstanding, Weighted Average Remaining Contractual Term (Year)	3 years 3 months 21 days	3 years 8 months 12 days
Warrant Exercisable, Weighted Average Remaining Contractual Term (Year)	3 years 3 months 21 days
Warrants Outstanding, Aggregate Intrinsic Value	$ 0
Warrants Exercised, Aggregate Intrinsic Value	248
Warrants Outstanding, Aggregate Intrinsic Value	3,989	$ 0
Warrants Exercisable, Aggregate Intrinsic Value	$ 3,989

Subsequent Events (Details Text

Subsequent Events (Details Textual) - USD ($)	May 08, 2021	Jan. 21, 2021	Mar. 31, 2021
Subsequent Event [Line Items]
Granted (in shares)			66,300
Grants in period, weighted average exercise price (in dollars per share)			$ 9.74
Fair value assumptions, expected dividend payments		$ 0
Merger Agreement | AbbVie Inc. | Subsequent Event
Subsequent Event [Line Items]
Merger related costs, cash paid per share	$ 22.60
Termination fees	$ 18,625,000
Reverse termination fees	$ 20,000,000
Share-based Payment Arrangement, Option
Subsequent Event [Line Items]
Expiration term period		10 years
Award vesting rights, percentage		25.00%
Award vesting period		4 years
Aggregate grant date fair value		$ 2,500,000	$ 500,000
Discount rate		1.03%
Initial award option purchasing term		6 years 3 months
Fair value assumptions, expected volatility rate		90.77%
Fair value assumptions, expected dividend payments			$ 0
Share price (in dollars per share)		$ 16.47
Certain Individuals
Subsequent Event [Line Items]
Granted (in shares)		345,350	66,300
Grants in period, weighted average exercise price (in dollars per share)		$ 9.74	$ 9.74