Document and Entity Information
Document and Entity Information - USD ($) $ in Millions | 12 Months Ended | ||
Sep. 30, 2015 | Dec. 14, 2015 | Mar. 31, 2015 | |
Document and Entity Information | |||
Entity Registrant Name | Corium International, Inc. | ||
Entity Central Index Key | 1,594,337 | ||
Document Type | 10-K | ||
Document Period End Date | Sep. 30, 2015 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --09-30 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Trading Symbol | cori | ||
Entity Public Float | $ 61.5 | ||
Entity Common Stock, Shares Outstanding | 22,218,739 | ||
Document Fiscal Year Focus | 2,015 | ||
Document Fiscal Period Focus | FY |
BALANCE SHEETS
BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2015 | Sep. 30, 2014 |
Current assets: | ||
Cash and cash equivalents | $ 72,218 | $ 36,395 |
Accounts receivable | 4,461 | 4,168 |
Unbilled accounts receivable | 812 | 1,385 |
Inventories, net | 2,902 | 2,592 |
Prepaid expenses and other current assets | 1,367 | 1,292 |
Total current assets | 81,760 | 45,832 |
Property and equipment, net | 11,593 | 12,658 |
Debt financing costs, net | 554 | 571 |
Intangible assets, net | 6,837 | 6,683 |
TOTAL ASSETS | 100,744 | 65,744 |
Current liabilities: | ||
Accounts payable | 3,952 | 2,512 |
Accrued expenses and other current liabilities | 4,091 | 4,008 |
Long-term debt, current portion | 57 | 107 |
Capital lease obligations, current portion | 820 | 760 |
Recall liability, current portion | 760 | 774 |
Deferred contract revenues, current portion | 134 | 301 |
Total current liabilities | 9,814 | 8,462 |
Long-term debt, net of current portion | 49,807 | 38,155 |
Capital lease obligations, net of current portion | 72 | 891 |
Recall liability, net of current portion | 2,229 | 2,936 |
Deferred contract revenues, net of current portion | 3,500 | 3,500 |
Total liabilities | $ 65,422 | $ 53,944 |
Commitments and contingencies (Note 9) | ||
Stockholders’ equity: | ||
Common stock; par value of $0.001 per share, 150,000,000 shares authorized; 22,160,991 and 18,003,883 shares issued and outstanding as of September 30, 2015 and 2014, respectively | $ 22 | $ 18 |
Additional paid-in capital | 166,085 | 114,117 |
Accumulated deficit | (130,785) | (102,335) |
Total stockholders’ equity | 35,322 | 11,800 |
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ 100,744 | $ 65,744 |
BALANCE SHEETS (Parenthetical)
BALANCE SHEETS (Parenthetical) - $ / shares | Sep. 30, 2015 | Sep. 30, 2014 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 150,000,000 | 150,000,000 |
Common stock, shares issued | 22,160,991 | 18,003,883 |
Common stock, shares outstanding | 22,160,991 | 18,003,883 |
Convertible Preferred Stock | ||
Convertible or Redeemable stock, shares authorized | 5,000,000 | 5,000,000 |
Convertible or Redeemable stock, shares outstanding | 0 | 0 |
STATEMENTS OF OPERATIONS AND CO
STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2013 | |
Revenues: | |||
Product revenues | $ 26,514 | $ 32,202 | $ 38,704 |
Contract research and development revenues | 12,721 | 9,026 | 10,750 |
Other revenues | 1,686 | 1,212 | 816 |
Total revenues | 40,921 | 42,440 | 50,270 |
Costs and operating expenses: | |||
Cost of product revenues | 17,608 | 20,204 | 24,828 |
Cost of contract research and development revenues | 16,064 | 15,391 | 11,856 |
Research and development expenses | 16,454 | 7,365 | 5,496 |
General and administrative expenses | 11,185 | 9,095 | 6,525 |
Amortization of intangible assets | 622 | 547 | 541 |
(Gain) / loss on disposal and sale and leaseback of equipment | 12 | (112) | (177) |
Total costs and operating expenses | 61,945 | 52,490 | 49,069 |
Loss from operations | (21,024) | (10,050) | 1,201 |
Interest income | 23 | 7 | 9 |
Interest expense | (7,446) | (6,961) | (7,705) |
Change in fair value of preferred stock warrant liability | (274) | (14) | |
Change in fair value of subordinated note embedded derivative liability | 7,367 | (7,367) | |
Loss before income taxes | (28,447) | (9,911) | (13,876) |
Income tax expense | 3 | 1 | 1 |
Net Income (loss) and comprehensive loss | $ (28,450) | $ (9,912) | $ (13,877) |
Net loss per share attributable to common stockholders, basic and diluted (in dollars per share) | $ (1.52) | $ (0.99) | $ (6.24) |
Weighted-average shares used in computing net loss per share attributable to common stockholders, basic and diluted (in shares) | 18,709,292 | 10,043,640 | 2,222,981 |
STATEMENTS OF CONVERTIBLE PREFE
STATEMENTS OF CONVERTIBLE PREFERRED STOCK, REDEEMABLE COMMON STOCK AND STOCKHOLDERS' EQUITY (DEFICIT) - USD ($) $ in Thousands | Convertible Preferred Stock | Redeemable Common Stock | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Total |
Balance at Sep. 30, 2012 | $ 57,261 | $ 3,224 | ||||
Balance (in shares) at Sep. 30, 2012 | 36,034,900 | 347,945 | ||||
Balance at Sep. 30, 2013 | $ 57,261 | $ 3,224 | ||||
Balance (in shares) at Sep. 30, 2013 | 36,034,900 | 347,945 | ||||
Balance at Sep. 30, 2012 | $ 2 | $ (27,802) | $ (78,546) | $ (106,346) | ||
Balance (in shares) at Sep. 30, 2012 | 1,854,988 | |||||
Increase (Decrease) in Stockholders' Equity (Deficit) | ||||||
Issuance of common stock warrants in connection with debt and capital lease financing | 38 | 38 | ||||
Issuance of common stock upon exercise of stock options | 13 | 13 | ||||
Issuance of common stock upon exercise of stock options (in shares) | 26,189 | |||||
Stock-based compensation | 330 | 330 | ||||
Modification of warrants issued in connection with debt | 742 | 742 | ||||
Net income (loss) and comprehensive income (loss) | (13,877) | (13,877) | ||||
Balance at Sep. 30, 2013 | $ 2 | (26,679) | (92,423) | (119,100) | ||
Balance (in shares) at Sep. 30, 2013 | 1,881,177 | |||||
Increase (Decrease) in Stockholders' Equity (Deficit) | ||||||
Issuance of common stock upon exercise of stock options | 34 | 34 | ||||
Issuance of common stock upon exercise of stock options (in shares) | 14,650 | |||||
Stock-based compensation | 1,629 | 1,629 | ||||
Decrease in equity associated with modification of subordinated debt | (3,485) | (3,485) | ||||
Issuance of common stock in connection with public offering, net of issuance costs | $ 7 | 48,452 | 48,459 | |||
Issuance of common stock in connection with public offering, net of issuance costs (in shares) | 6,874,997 | |||||
Conversion of convertible preferred stock to common stock in connection with initial public offering | $ (57,261) | $ 4 | 57,257 | 57,261 | ||
Conversion of convertible preferred stock to common stock in connection with initial public offering (in shares) | (36,034,900) | 3,567,807 | ||||
Issuance of common stock upon conversion of subordinated debt in connection with the recapitalization transaction | $ 3 | 19,234 | 19,237 | |||
Issuance of common stock upon conversion of subordinated debt in connection with the recapitalization transaction (in shares) | 3,387,146 | |||||
Issuance of common stock in connection with conversion of convertible debt | $ 2 | 19,367 | 19,369 | |||
Issuance of common stock in connection with conversion of convertible debt (in shares) | 2,036,555 | |||||
Issuance of common stock upon net exercise of preferred stock warrants and related extinguishment of preferred stock warrant liability | 310 | 310 | ||||
Issuance of common stock upon net exercise of preferred stock warrants and related extinguishment of preferred stock warrant liability (in shares) | 1,191 | |||||
Issuance of common stock upon net exercise of common stock warrants | $ 1 | (1) | ||||
Issuance of common stock upon net exercise of common stock warrants (in shares) | 970,249 | |||||
Repurchase of redeemable common stock and common stock from founders | $ (3,224) | $ (1) | (2,001) | (2,002) | ||
Repurchase of redeemable common stock and common stock from founders (in shares) | 347,945 | 729,864 | ||||
Aggregate fractional shares cancelled in connection with reverse stock split | (25) | |||||
Net income (loss) and comprehensive income (loss) | (9,912) | (9,912) | ||||
Balance at Sep. 30, 2014 | $ 18 | 114,117 | (102,335) | 11,800 | ||
Balance (in shares) at Sep. 30, 2014 | 18,003,883 | |||||
Increase (Decrease) in Stockholders' Equity (Deficit) | ||||||
Issuance of common stock upon exercise of stock options | 44 | 44 | ||||
Issuance of common stock upon exercise of stock options (in shares) | 16,934 | |||||
Stock-based compensation | 2,714 | 2,714 | ||||
Issuance of common stock in connection with public offering, net of issuance costs | $ 4 | 48,639 | 48,643 | |||
Issuance of common stock in connection with public offering, net of issuance costs (in shares) | 4,000,000 | |||||
Issuance of common stock upon net exercise of common stock warrants (in shares) | 12,591 | |||||
Issuance of common stock under Employee Stock Purchase Plan | 570 | 570 | ||||
Issuance of common stock under Employee Stock Purchase Plan (in shares) | 119,465 | |||||
Issuance of common stock upon exercise of common stock warrants | 1 | 1 | ||||
Issuance of common stock upon exercise of common stock warrants (in shares) | 8,118 | |||||
Net income (loss) and comprehensive income (loss) | (28,450) | (28,450) | ||||
Balance at Sep. 30, 2015 | $ 22 | $ 166,085 | $ (130,785) | $ 35,322 | ||
Balance (in shares) at Sep. 30, 2015 | 22,160,991 |
STATEMENTS OF CASH FLOWS
STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2013 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | |||
Net loss and comprehensive loss | $ (28,450) | $ (9,912) | $ (13,877) |
Adjustments to reconcile net income (loss) to net cash used by operating activities: | |||
Depreciation and amortization of property and equipment | 2,015 | 2,230 | 1,892 |
(Gain) / loss on disposal and sale and leaseback of equipment | 12 | (112) | (177) |
Amortization of premium on modification of subordinated note | (292) | ||
Change in fair value of preferred stock warrant liability | 274 | 14 | |
Change in fair value of subordinated note embedded derivative liability | (7,367) | 7,367 | |
Amortization of intangible assets | 622 | 547 | 541 |
Noncash amortized issue costs on long-term debt and capital leases | 167 | 331 | 329 |
Noncash amortized discount on long-term debt and capital leases | 23 | 128 | 196 |
Write off of patent costs | 82 | ||
Stock-based compensation expense | 2,714 | 1,629 | 330 |
Interest expense on convertible and subordinated notes converted to common stock | 823 | ||
Changes in operating assets and liabilities: | |||
Accounts receivable | (293) | (1,039) | (329) |
Unbilled accounts receivable | 573 | 110 | 672 |
Inventories, net | (310) | 1,916 | (139) |
Prepaid expenses and other current assets | (75) | (255) | (137) |
Accounts payable | 1,440 | 700 | (878) |
Accrued expenses and other current liabilities | 1,735 | 2,058 | 1,329 |
Deferred contract revenues | (167) | (1,998) | 321 |
Recall liability | (721) | (1,122) | (168) |
Long-term interest payable | 1,650 | ||
Net cash used by operating activities | (20,715) | (11,351) | (982) |
CASH FLOWS FROM INVESTING ACTIVITIES: | |||
Purchases of property and equipment | (973) | (3,221) | (7,163) |
Proceeds from sale of equipment | 11 | 12 | 17 |
Issuance of notes receivable - related parties | (100) | ||
Proceeds from repayment of notes receivable - related parties | 100 | ||
Payments for patents and licensing rights | (776) | (584) | (693) |
Net cash used by investing activities | (1,738) | (3,693) | (7,939) |
CASH FLOWS FROM FINANCING ACTIVITIES: | |||
Proceeds from issuance of common stock, net of issuance costs | 48,643 | 48,459 | |
Repurchase of redeemable common stock from founders | (5,225) | ||
Proceeds from issuance of long-term debt | 10,000 | 7,230 | |
Proceeds from issuance of capital leases | 2,266 | ||
Payment of transaction costs associated with issuance of long-term debt | (150) | (112) | |
Principal payments on long-term debt | (67) | (484) | (812) |
Principal payments on capital lease obligations | (765) | (1,054) | (629) |
Borrowings on bank line of credit | 1,298 | 5,827 | |
Payments on bank line of credit | (5,170) | (3,526) | |
Proceeds from exercise of stock options | 44 | 34 | 13 |
Proceeds from exercise of common stock warrants | 1 | ||
Proceeds from issuance of common stock under employee stock purchase plan | 570 | ||
Net cash provided by financing activities | 58,276 | 37,858 | 10,257 |
NET INCREASE IN CASH AND CASH EQUIVALENTS | 35,823 | 22,814 | 1,336 |
CASH AND CASH EQUIVALENTS - Beginning of period | 36,395 | 13,581 | 12,245 |
CASH AND CASH EQUIVALENTS - End of period | 72,218 | 36,395 | 13,581 |
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: | |||
Cash paid for interest | 5,604 | 4,669 | 4,856 |
Cash paid for income taxes | 2 | 2 | |
SUPPLEMENTAL DISCLOSURES OF NON-CASH INVESTING AND FINANCING ACTIVITIES: | |||
Issuance of common stock warrants in connection with debt financing and equipment lease financing | 38 | ||
Property and equipment purchases included in accounts payable | 198 | 198 | 1,134 |
Issuance of payment-in-kind notes in lieu of cash interest payments | $ 1,652 | 1,305 | 1,235 |
Unpaid deferred offering costs | $ 20 | ||
Decrease in equity due to premium associated with modification of subordinated debt | 3,485 | ||
Conversion of convertible preferred stock to common stock | 57,261 | ||
Issuance of common stock upon conversion of subordinated debt | 19,237 | ||
Issuance of common stock upon conversion of convertible debt | 19,369 | ||
Issuance of common stock upon net exercise of preferred stock warrants | $ 834 |
Organization, Description of Bu
Organization, Description of Business, and Summary of Significant Accounting Policies | 12 Months Ended |
Sep. 30, 2015 | |
Organization, Description of Business, and Summary of Significant Accounting Policies | |
Organization, Description of Business, and Summary of Significant Accounting Policies | CORIUM INTERNATIONAL, INC. Notes to the Financ ial Statements 1. Organization, Description of Business, and Summary of Significant Accounting Policies Organization Corium International, Inc., a Delaware corporation (the "Company"), is a commercial stage biopharmaceutical company focused on the development, manufacture and commercialization of specialty pharmaceutical products that leverage its broad experience in transdermal and transmucosal delivery systems. In the normal course of business, the Company enters into collaboration agreements with partners to develop and manufacture products based on the Company's drug delivery technologies and product development expertise. Revenues consist of net sales of products manufactured, royalties and profit-sharing payments based on sales of such products by partners, and product development fees for research and development activities under collaboration agreements with partners. The Company is also engaged in the research and development of its own proprietary transdermal drug delivery products using its Corplex and MicroCor technologies. The Company's fiscal year ends on September 30. References to "fiscal" refer to the years ended September 30. Basis of Presentation The Company's financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Reverse Stock Split On March 20, 2014, the Company effected a 1-for-10.1 reverse stock split of the Company’s outstanding common stock resulting in a reduction of the Company’s total common stock issued and outstanding from 19,032,056 shares to 1,884,362 shares. The reverse stock split affected all stockholders of the Company’s common stock uniformly, and did not materially affect any stockholder’s percentage of ownership interest. The par value of the Company’s common stock remained unchanged at $0.001 per share and the number of authorized shares of common stock remained the same after the reverse stock split. In connection with this reverse stock split, the number of shares of common stock reserved for issuance under the Company’s equity incentive, stock option and employee stock purchase plans, as well as the shares of common stock underlying outstanding stock options and warrants, were also proportionately reduced while the exercise prices of such stock options and warrants were proportionately increased. All references to shares of common stock and per share data for all periods presented in the accompanying financial statements and notes thereto have been adjusted to reflect the reverse stock split on a retroactive basis. Initial Public Offering In April 2014, the Company sold 6,874,997 shares of its common stock in its initial public offering (the “IPO”) at a price of $8.00 per share. The Company received net cash proceeds of $48.5 million from the IPO, including proceeds from the partial exercise of the underwriters’ option, after deducting underwriting discounts, commissions and issuance costs paid by the Company, which totaled $6.5 million. On April 8, 2014, immediately prior to the closing of the IPO, all outstanding shares of convertible preferred stock were converted into 3,567,807 shares of common stock, and the related carrying value of $57.3 million was reclassified to common stock and additional paid-in capital. In addition, certain warrants to purchase convertible preferred stock and common stock were converted and net exercised into 971,440 shares of common stock. In connection with the IPO, Corium also repurchased 1,077,809 shares of common stock from its founders for an aggregate purchase price of $5.2 million. Following the filing of the Restated Certificate of Incorporation of the Company on April 8, 2014, the number of shares of capital stock the Company is authorized to issue is 155,000,000 shares, of which 150,000,000 shares may be common stock and 5,000,000 shares may be preferred stock. Both the common stock and preferred stock have a par value of $0.001 per share. Use of Estimates Estimates and assumptions are required to be used by management in the preparation of financial statements in conformity with U.S. GAAP that affect the reported amounts of assets, liabilities, and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of operating revenues and operating expenses during the reporting period. Those estimates and assumptions affect revenue recognition and deferred revenues, impairment of long-lived assets, determination of fair value of stock-based awards and other debt- and equity- related instruments, and accounting for income taxes. As future events and their effects cannot be determined with precision, actual results could differ from those estimates. Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist of cash and cash equivalents and accounts receivable. The Company maintains its cash and cash equivalents with a single domestic financial institution that is well capitalized. The Company provides credit, in the normal course of business, to its partners and performs credit evaluations of such partners. In fiscal 2015, three partners accounted for 82 % of the Company’s revenues and 84% of accounts receivable as of September 30, 2015. In fiscal 2014 and 2013, four partners accounted for 95% and 99% of the Company's revenues and 95% of accounts receivable as of September 30, 2014. Revenue Recognition The Company generates revenues from agreements for the development and commercialization of its products. The terms of the agreements may include nonrefundable upfront payments, partial or complete reimbursement of research and development costs, milestone payments, product sales, and profit sharing and royalties on partners’ product sales of products that we manufacture on their behalf. The Company recognizes revenues when the following criteria are met: persuasive evidence of a sales or service arrangement exists; delivery has occurred; the price is fixed or determinable; and collectability is reasonably assured. Revenue related to multiple element arrangements are analyzed to determine whether the deliverables can be separated or whether they must be accounted for as a single unit of accounting. This determination is generally based on whether any deliverable has stand-alone value to the partner. This analysis also establishes a selling price hierarchy for determining how to allocate arrangement consideration to identified units of accounting. The selling price used for each unit of accounting is based on vendor-specific objective evidence, if available, third-party evidence if vendor-specific objective evidence is not available, or estimated selling price if neither vendor-specific nor third-party evidence is available. Typically, the Company has not granted licenses to partners at the beginning of its arrangements and, thus, there are no delivered items separate from the research and development services provided. As such, upfront payments are recorded as deferred revenues in the balance sheet and are recognized as contract research and development revenues over the estimated period of performance that is consistent with the terms of the research and development obligations contained in the agreement. The Company periodically reviews the estimated period of performance based on the progress made under each arrangement. Amounts related to research and development funding are generally recognized as the related services or activities are performed in accordance with the contract terms. To the extent that agreements specify services are to be performed on a cost ‑plus basis, revenues are recognized as services are rendered. Such work is generally billed on a monthly basis for time incurred at specified rates in the agreements. To the extent that agreements specify services to be performed on a fixed-price basis, revenues are recognized consistent with the pattern of the work performed. Many of the agreements provide for reimbursement of third-party expenses, and such reimbursable expenses are billed as revenues at the time the associated expenses are incurred. The arrangements may include contractual milestones, which relate to the achievement of pre-specified research, development, regulatory and commercialization events. The milestone events contained in the Company's arrangements coincide with the progression of the products from research and development, to regulatory approval, and through to commercialization. The process of successfully developing a new product, having it approved from a regulatory perspective and ultimately sold for a profit is highly uncertain. As such, the milestone payments that the Company is eligible to earn from its partners involve a significant degree of risk to achieve. Research and development milestones in the Company's partner arrangements may include the following types of events: completion of pre-clinical research and development work, completion of certain development events and initiation or completion of clinical trials. Regulatory milestones may include the following types of events: filing of regulatory applications with the Food and Drug Administration and approval of the regulatory applications by the Food and Drug Administration. Commercialization milestones generally relate to product launch. The Company recognizes milestone payments in their entirety in the period in which the milestone is achieved. Upon commercialization, revenues are generated from product sales, royalties and profit sharing. Product sales are generally recognized as products are shipped and title and risk of loss pass to the partner. Royalties and profit sharing are generally recognized when the partners sell the product to their customers, which could be in a different accounting period than the period in which the Company sold that product to its partner, and are based on a percentage of the partners' net sales of or net profits on the products. Product sales and royalty income are presented collectively as product revenues. Royalties and profit sharing totaled $2.3 million, $6.7 million and $7.8 million for fiscal 2015, 2014 and 2013. Other revenues consists of income derived from the Company's arrangements with its partners, whereby a portion of the revenues received under these agreements relates to rental income from embedded leases associated with manufacturing equipment and facilities specific to these relationships, as well as revenues associated with licenses granted to our partners, whereby the Company receives milestone payments upon commercial launch of each new product developed by the Company using the Company’s intellectual property. Research and Development Expenses Research and development expenses primarily comprise salaries and benefits associated with research and development personnel, overhead and facility costs, pre-clinical and non-clinical development costs, clinical trial, and related clinical manufacturing costs, contract services, and other outside costs. Research and development costs, including costs to be subsequently reimbursed under development contracts, are charged to expense when incurred. Advertising Costs The Company's advertising expenses were immaterial for fiscal 2015, 2014 and 2013. Stock-Based Compensation The Company accounts for stock-based compensation for all share-based awards made to employees and directors, including employee stock options and employee stock purchases related to the Employee Stock Purchase Plan, by measuring the cost of awards of equity instruments based on the grant-date fair value of the award. The Company determines the fair value of such awards using the Black-Scholes option-pricing model (the "Black-Scholes model"). The Black-Scholes model for stock options incorporates certain assumptions as follows: Expected Term — The expected term represents the period that the stock-based awards are expected to be outstanding before exercise or cancellation. As the Company's historical share exercise experience did not provide a reasonable basis upon which to estimate expected term because of a lack of sufficient data points, the Company estimated the expected term by using the midpoint between the vesting commencement date and the contractual expiration period of the stock-based award. Risk-Free Interest Rate — The risk-free interest rate is based on the constant maturity yields of U.S. Treasury notes with remaining maturities similar to the expected term. Expected Volatility — Because the Company has limited information on the volatility of its common stock due to a lack of significant trading history and limited historical data regarding the volatility of its common stock, the expected volatility used is based on volatility of a group of comparable publicly traded companies. In evaluating comparability, the Company considered factors such as industry, stage of life cycle and size. The Company will continue to analyze the historical stock price volatility and term assumptions as more historical data for the Company’s common stock becomes available. Expected Dividend –– The Company has never paid any dividends, does not plan to pay dividends in the foreseeable future, and, therefore, uses an expected dividend rate of zero in the valuation model. The Company recognizes compensation expense for stock options for the portion of the share-based awards that are expected to vest. Therefore, the Company applied estimated forfeiture rates that were derived from historical employee termination behavior. If the actual number of forfeitures differs from those estimated by management, additional adjustments to compensation expense may be required in future periods. Income Taxes The Company accounts for income taxes based on the liability method. Under the liability method, deferred tax assets and deferred tax liabilities are recognized for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and deferred tax liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and deferred tax liabilities of a change in tax rates is recognized in operations in the period that includes the enactment date. A valuation allowance is established when it is more likely than not that all or a portion of a deferred tax asset will not be realized. Financial statement effects of uncertain tax positions are recognized when it is more likely than not, based on the technical merits of the position, that it will be sustained upon examination. Comprehensive Income (Loss) During fiscal 2015, 2014 and 2013, the Company did not recognize any other comprehensive income (loss) and, therefore, the net loss and comprehensive loss was the same for all periods presented. Net Loss per Share Attributable to Common Stockholders The Company calculates its basic and diluted net loss per share attributable to common stockholders in conformity with the two-class method required for companies with participating securities. The Company's basic net loss per share attributable to common stockholders is calculated by dividing the net loss attributable to common stockholders by the weighted average number of shares of common stock outstanding for the period. The diluted net loss per share attributable to common stockholders is computed by giving effect to all potential dilutive common stock equivalents outstanding for the period. For purposes of the diluted calculation, convertible preferred stock, options to purchase common stock, shares authorized under the employee stock purchase plan and common stock warrants are considered common stock equivalents but are excluded from the calculation of diluted net loss per share attributable to common stockholders if their effect is antidilutive. Cash and Cash Equivalents The Company considers all highly liquid investments with original maturities of three months or less at the date of purchase to be cash equivalents. The Company generally invests funds that are in excess of current needs in high ‑credit ‑quality instruments, such as money market funds. Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable are stated at invoiced amounts. An allowance for doubtful accounts is established as needed based on a specific assessment of all invoices that remain unpaid following normal partner payment periods. All amounts deemed to be uncollectible are charged against the allowance for doubtful accounts in the period that the determination is made. The allowance for doubtful accounts was $0 as of September 30, 2015 and 2014. Inventories Inventories are stated at the lower of cost, on a first-in, first-out basis, or market. The Company records an allowance for excess and obsolete inventory based on anticipated obsolescence, usage, and historical write-offs. Property and Equipment Property and equipment are recorded at cost, net of accumulated depreciation and amortization. Equipment is depreciated over its useful life, ranging from 3 to 8 years using the straight-line method. Leasehold improvements are depreciated or amortized over the shorter of the lease term or their useful lives ranging from 3 to 15 years using the straight-line method. Expenditures for maintenance and repairs are charged to expense as incurred. Capital Leases The Company leases several pieces of equipment under capital lease arrangements. Equipment leased under capital leases is amortized over the life of the lease term using the straight-line method. Intangible Assets Intangible assets consist primarily of the cost of acquired patents and legal costs associated with patent development and contract acquisition costs. These costs are capitalized and amortized on a straight-line basis over the lesser of the estimated economic lives of the patents or the underlying contracts and the remaining legal lives of the patents, which approximates the consumption over the estimated useful lives of the assets, once a patent is granted. The Company periodically reevaluates the original assumptions and rationale utilized in the establishment of the carrying value and estimated lives of these assets. Impairment of Long-Lived Assets Long-lived assets to be held and used are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Determination of recoverability is based on an estimate of undiscounted future cash flows resulting from the use of the assets and their eventual disposition. Measurement of an impairment loss for long-lived assets that management expects to hold and use is based on the fair value of the asset. No impairment was recorded for fiscal 2015, 2014 or 2013. Fair Value of Financial Instruments Fair value accounting is applied for all financial assets and liabilities and non-financial assets and liabilities that are recognized or disclosed at fair value in the financial statements on a recurring basis (at least annually). Assets and liabilities recorded at fair value in the financial statements are categorized based upon the level of judgment associated with the inputs used to measure their fair value. Hierarchical levels, which are directly related to the amount of subjectivity associated with the inputs to the valuation of these assets or liabilities, are as follows: Level I — Inputs that are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date. Level II — Inputs that are observable, unadjusted quoted prices in active markets for similar assets or liabilities, unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the related assets or liabilities; and Level III — Unobservable inputs that are significant to the measurement of the fair value of the assets or liabilities that are supported by little or no market data. Convertible Preferred Stock Warrants Prior to their conversion into common stock on April 8, 2014 in connection with the Company’s IPO, the Company accounted for certain warrants to purchase shares of convertible preferred stock as liabilities at fair value, as it had determined that some of these warrants were derivative instruments because they contained antidilution provisions that protected the holders from certain equity issuances at a price below the original issue price of the underlying security. The Company remeasured these warrants to fair value at each balance sheet date, and recognized any change in the fair value as a change in the warrant liability in its statements of operations and comprehensive loss. The Company estimated the fair value of these warrants at the respective balance sheet dates using the Probability-Weighted Expected Return Method (“PWERM”), in fiscal 2013 and 2014. The Company used a number of assumptions to estimate the fair value, including the likelihood of various scenarios, the expected volatility, and the fair value of the underlying stock under each scenario. This liability was reclassified to equity in fiscal 2014 in connection with the Company’s IPO. Subordinated Note Embedded Derivative Liability Prior to its conversion into common stock on April 8, 2014 in connection with the Company’s IPO, the Company had an outstanding subordinated note that the Company had determined contained an embedded derivative instrument related to redemption and conversion features of the note. These features required bifurcation and separate accounting, and the embedded derivative was accounted for as a liability. The embedded derivative liability was remeasured to fair value at each balance sheet date, with the corresponding gain or loss from the adjustment recorded in the statements of operations and comprehensive loss. The fair value of the embedded derivative was measured with the PWERM valuation method. Under this method, fair value is primarily driven by the assessment of the probability and timing of scenarios that could result in the redemption of the note prior to the note's maturity, which would trigger the payment of the additional amount equal to the outstanding principal of the subordinated note. Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board issued ASU No. 2014-09, “Revenue from Contracts with Customers”, Topic 606. This ASU affects any entity that either enters into contracts with customers to transfer goods or services or enters into contracts for the transfer of nonfinancial assets, unless those contracts are within the scope of other standards. The guidance in this ASU supersedes the revenue recognition requirements in Topic 605, Revenue Recognition and most industry-specific guidance. The core principle of the guidance is that an entity should recognize revenue to illustrate 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. The new guidance also includes a set of disclosure requirements that will provide users of financial statements with comprehensive information about the nature, amount, timing, and uncertainty of revenue and cash flows arising from a reporting organization’s contracts with customers. In August 2015, the Financial Accounting Standards Board issued ASU No. 2015-14, “ Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date ”, which defers the effective date of ASU 2014-09 by one year. The ASU is effective for annual reporting periods, and interim periods within those years, beginning after December 15, 2017 for public companies and permits the use of either the retrospective or cumulative effect transition method, with early application permitted as of annual reporting periods beginning after December 15, 2016, including interim reporting periods within those annual periods . The Company is evaluating the effect, if any, that this ASU may have on the Company’s financial position and results of operations. In April 2015, Financial Accounting Standards Board issued ASU No. 2015-03, “Simplifying the Presentation of Debt Issuance Costs.” This ASU requires debt issuance costs to be presented in the balance sheet as a reduction of the related liability rather than an asset. This ASU is effective for annual reporting periods beginning after December 15, 2015, including interim periods within that reporting period, and is to be applied retrospectively; early adoption is permitted. The adoption of this standard is not expected to have a material impact on the Company’s financial statements. In July 2015, the Financial Accounting Standards Board issued ASU No. 2015-11, “Inventory (Topic 330): Simplifying the Measurement of Inventory.” This ASU applies to inventory that is measured using first-in, first-out or average cost. Inventory within the scope of this update is required to be recorded at the lower of cost or net realizable value, which is the estimated selling price in the ordinary course of business less reasonably predictable costs of completion, disposal and transportation. This ASU is effective prospectively for annual reporting periods beginning after December 15, 2016, and interim periods thereafter; early adoption is permitted. The adoption of this standard is not expected to have a material impact on the Company’s financial statements. In November 2015, the Financial Accounting Standards Board issued ASU No. 2015-17, “Balance Sheet Classification of Deferred Taxes.” This ASU requires entities to present deferred tax assets and deferred tax liabilities as noncurrent in a classified balance sheet. This ASU is effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period, and entities are permitted to apply either prospectively or retrospectively; early adoption is permitted. The adoption of this standard is not expected to have a material impact on the Company’s financial statements. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Sep. 30, 2015 | |
Fair Value Measurements | |
Fair Value Measurements | 2. Fair Value Measurements Financial assets and liabilities are recorded at fair value. Except as noted below, the carrying values of the Company’s financial instruments, including cash equivalents, accounts receivable, and accounts payable, approximated their fair values due to the short period of time to maturity or repayment. The Company's financial instruments that are measured at fair value on a recurring basis as of September 30, 2015 and 2014, by level within the fair value hierarchy, are as follows (in thousands): As of September 30, 2015 Level I Level II Level III Total Financial Assets: Money market funds $ $ — $ — $ As of September 30, 2014 Level I Level II Level III Total Financial Assets: Money market funds $ $ — $ — $ The Company did not have Level III liabilities as of September 30, 2015 and 2014. A s of September 30, 2013, the Company's Level III liabilities consisted of a preferred stock warrant liability (see Note 11) and subordinated note embedded derivative liability (Note 8). On April 8, 2014, in connection with the closing of the IPO, the preferred stock warrant liability and the subordinated note embedded derivative liability were eliminated when the preferred stock and subordinated note were converted into shares of common stock. The following table sets forth a summary of the changes in the fair value of the Company's Level III financial liabilities, which are measured on a recurring basis (in thousands): Year Ended September 30, 2014 Beginning balance $ Change in fair value of preferred stock warrant liability Change in fair value of subordinated note embedded derivative liability Extinguishment of preferred stock warrant liability Ending balance $ — The following financial liabilities have carrying values which differ from their fair value as estimated by the Company based on market quotes for instruments with similar terms and remaining maturities (Level III valuation) (in thousands): As of September 30, 2015 Carrying Fair Value Value Difference Long-term debt $ $ $ As of September 30, 2014 Carrying Fair Value Value Difference Long-term debt $ $ $ |
Inventories
Inventories | 12 Months Ended |
Sep. 30, 2015 | |
Inventories | |
Inventories | 3. Inventories Inventories consist of the following (in thousands): As of September 30, 2015 2014 Raw materials $ $ Work in process Finished goods Total inventories, cost Less inventory reserves Total inventories, net $ $ |
Property and Equipment
Property and Equipment | 12 Months Ended |
Sep. 30, 2015 | |
Property and Equipment | |
Property and Equipment | 4. Property and Equipment Property and equipment consist of the following (in thousands): As of September 30, 2015 2014 Machinery and equipment $ $ Manufacturing equipment acquired under capital leases Transportation equipment Furniture and fixtures Computer equipment and software Leasehold improvements Land Construction in progress Total property and equipment, gross Accumulated depreciation and amortization Total property and equipment, net $ $ The Company recorded depreciation and amortization of property and equipment of $2.0 million, $ 2.2 million and $ 1.9 million during fiscal 2015, 2014 and 2013. |
Intangible Assets
Intangible Assets | 12 Months Ended |
Sep. 30, 2015 | |
Intangible Assets | |
Intangible Assets | 5. Intangible Assets Intangible assets and related accumulated amortization consist of the following (in thousands): As of September 30, 2015 2014 Cost: Patents and trademarks $ $ Contract acquisition costs Total carrying value Accumulated amortization: Patents and trademarks Contract acquisition costs Total accumulated amortization Total intangible assets, net $ $ The Company amortizes its intangible assets related to issued patents over the estimated useful lives of the patents, ranging from 7 to 20 years. Amortization of issued patents was $0.6 million, $0.5 million and $0.5 million in fiscal 2015, 2014 and 2013. The Company did not recognize an impairment during fiscal 2015, 2014 or 2013. The estimated remaining annual amortization expenses for issued patents and trademarks as of September 30, 2015 are as follows (in thousands): Year Ending September 30: Amounts 2016 $ 2017 2018 2019 2020 Thereafter Total $ Patents in process included in intangible assets were $2.6 million and $2.1 million during fiscal 2015 and 2014. The Company amortizes its intangible assets related to contract acquisition costs over their estimated useful lives, ranging from 4 to 15 years. Amortization of contract acquisition costs was $29,000, $29,000 and $65,000 in fiscal 2015, 2014 and 2013. The estimated remaining annual amortization expense for contract acquisition cost as of September 30, 2015 are as follows (in thousands): Year Ending September 30: Amounts 2016 $ 2017 2018 2019 2020 Thereafter — Total $ |
Notes Receivable - Related Part
Notes Receivable - Related Parties | 12 Months Ended |
Sep. 30, 2015 | |
Notes Receivable - Related Parties | |
Notes Receivable - Related Parties | 6. Notes Receivable — Related Parties The Company did not have any notes receivable as of September 30, 2015 or 2014. Notes receivable as of September 30, 2013, consisted of an unsecured note payable by one of the executive officers of the Company. The note called for payment of one-half of the principal and accrued interest on December 28, 2015 and the remaining principal and interest on June 28, 2018. The note accrued interest at 1% below the prime rate , adjusted as of January 1 each year (an effective rate of 2.25% at September 30, 2013). The Company recognized less than $1,000 of related party interest income from this note in fiscal 2014 and 2013. The note was repaid in full in March 2014. |
Accrued Expenses and Other Curr
Accrued Expenses and Other Current Liabilities | 12 Months Ended |
Sep. 30, 2015 | |
Accrued Expenses and Other Current Liabilities | |
Accrued Expenses and Other Current Liabilities | 7. Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consist of the following (in thousands): As of September 30, 2015 2014 Vacation $ $ Bonus Warranty liability — Payroll Employee stock purchase plan liability Other Total accrued liabilities $ $ |
Debt
Debt | 12 Months Ended |
Sep. 30, 2015 | |
Long-Term Debt. | |
Debt | 8. Long-Term Debt The Company’s outstanding long-term debt consists of the following (in thousands): As of September 30, 2015 2014 Term loan agreement expiring June 30, 2019 , less discount of $58 and $76 as of September 30, 2015 and 2014. See terms of the agreement below. $ $ Notes payable to lessor for tenant improvements. The note calls for monthly payments of principal and interest of $3 at an interest rate of 7% and is due April 2017 Notes payable to lessor for tenant improvements. The note calls for monthly payments of principal and interest of $6 at an interest rate of 7% and is due November 2024 Total Less current portion Long-term portion $ $ On July 13, 2012, the Company completed a $35.0 million term loan agreement with CRG, a structured debt and equity investment management firm. In August 2012 and December 2012, the Company drew down $29.0 million and $6.0 million under this agreement. On November 14, 2014, the agreement was amended to, among other things, increase the principal amount available under the term loan by $10.0 million, extend the interest-only period to June 30, 2018, and extend the maturity from June 30, 2017 to June 30, 2019. The amended agreement provides for a maximum borrowing of $45.0 million, excluding PIK notes, as defined below. The amended agreement requires interest to be paid quarterly at a simple annual rate of 15% , and all outstanding principal be repaid in four equal quarterly payments beginning June 30, 2018, with interest continuing to accrue on the unpaid principal at a simple annual rate of 15% . In addition, the amended agreement contains a provision whereby the Company can, at each quarterly payment due date prior to June 30, 2018, choose to convert that portion of each quarterly interest obligation equal to 3.5% of the then-outstanding principal into additional notes (payment-in-kind (“PIK”) notes). As of September 30, 2015 and 2014, the Company had converted $4.4 million and $2.7 million of interest into PIK notes, each of which add to the then-outstanding principal. Amounts outstanding under the term loan agreement are collateralized by all of the Company's assets. On December 4, 2014, the Company borrowed the remaining $10.0 million of principal provided for in the amended agreement. As of September 30, 2015, the principal amount outstanding under the term loan agreement, including all PIK notes, was $49.4 million. The amended agreement provides for a prepayment penalty, the amount of which varies with the date on which prepayment is made, if the Company chooses to repay principal prior to June 30, 2018, or upon other specified events, including a change of control. The term loan agreement provides for financial covenants for minimum annual revenues (beginning with the 12 months ended June 30, 2015) and minimum liquidity, with which the Company has been in continuous compliance since the inception of the loan. Minimum principal payments on the Company's outstanding long-term debt, as of September 30, 2015 were as follows (in thousands): Year Ending September 30: Amounts 2016 $ 2017 2018 2019 2020 Thereafter Total $ Convertible Notes In 2008 and 2009, the Company issued convertible bridge notes (the “Convertible Notes”) and warrant purchase agreements to several of the then-existing Series C preferred stock investors, whereby the Company raised a total of $20.0 million. In July 2012, in connection of the closing of the $35.0 million term l oan agreement, the Company ratably repaid $10.0 million of principal on the Convertible Notes. Interest was not paid on the Convertible Notes since inception and was presented as long-term accrued interest. On April 8, 2014, in connection with the closing of the IPO, all of the Convertible Notes, with an aggregate principal and accrued interest amount of $19.4 million, were converted into 2,036,555 shares of common stock. Subordinated Note In 2009, the Company issued a subordinated note (the “Subordinated Note”) to one of the existing Series C preferred stock investors raising a total of $13.0 million. Interest was not paid on the Subordinated Note since inception and was presented as long-term accrued interest. If the Company had consummated a merger of the Company or a sale of all or substantially all of the Company's assets, or a significant asset sale prior to the full repayment of the Subordinated Note, then, at the written election of the subordinated note holder, the holder of the Subordinated Note would have been entitled to be repaid the entire outstanding balance under the Subordinated Note plus an additional amount equal to the outstanding principal under the Subordinated Note, plus all accrued interest. The Company determined that this feature was an embedded derivative requiring bifurcation and separate accounting. The fair value of this embedded derivative liability was $7.4 million as of September 30, 2013. The change in fair value was recorded to change in fair value of Subordinated Note embedded derivative liability. On April 8, 2014, in connection with the closing of the IPO, the Subordinated Note, with a principal amount, accrued interest and derivative liability totaling $19.2 million, was converted into 3,387,146 shares of common stock. Recapitalization In December 2013, the Company entered into an amendment and conversion agreement with Essex Woodlands pursuant to which: (i) the Company and Essex Woodlands amended the Convertible Notes held by Essex Woodlands and other investors to provide that they would automatically convert either into 2,036,555 shares of the Company’s common stock immediately prior to the closing of an initial public offering of the Company’s common stock or into 2,036,555 shares of the Company’s Series C preferred stock immediately prior to the first closing of a qualified equity financing that occurred prior to the closing of an initial public offering of the Company’s common stock, and the Convertible Notes would be terminated; (ii) the Company and Essex Woodlands amended the terms of the Subordinated Note to provide that it would automatically convert either into 3,387,146 shares of the Company’s common stock immediately prior to the closing of an initial public offering of the Company’s common stock or into 3,387,146 shares of a new series of the Company’s preferred stock (with identical rights, preferences and privileges as the Company’s Series C preferred stock, but with a liquidation preference of one times its original issue price) immediately prior to the first closing of a qualified equity financing that occurred prior to the closing of an initial public offering of the Company’s common stock, and the Subordinated Note would be terminated; and (iii) Essex Woodlands agreed that it would effect the automatic conversion of all outstanding shares of the Company’s preferred stock in connection with the completion of an initial public offering of the Company’s common stock. Simultaneously, the Company also entered into a repurchase agreement pursuant to which the Company agreed to repurchase 1,077,809 shares of the Company’s common stock from two of the Company’s founders, for an aggregate repurchase price of $5.2 million. The repurchases occurred in connection with the Company’s IPO (see Note 12). |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Sep. 30, 2015 | |
Commitments and Contingencies. | |
Commitments and Contingencies | 9. Commitments and Contingencies Capital Leases Certain manufacturing equipment is accounted for as a capital lease and is included in property and equipment as of September 30, 2015 and 2014. Future minimum lease payments under capital leases, together with the present value of the net minimum lease payments as of September 30, 2015, are as follows (in thousands): Year Ending September 30, Amounts 2016 $ 2017 2018 — Net minimum lease payments Less amount representing interest Present value of net minimum lease payments Less discount related to warrants Capital lease liability Less current portion Long-term portion $ Depreciation expense on equipment under capital leases was $0.8 million, $1.0 million and $0.6 million for fiscal 2015, 2014 and 2013. Operating Leases The Company conducts certain operations using leased property and equipment. The property and equipment leases require the Company to pay certain property taxes, insurance, and maintenance expenses, and expire on dates ranging through 2025. Total rental expense on operating leases for fiscal 2015, 2014 and 2013 amounted to $1.8 million, $1.7 million and $1.6 million. Future minimum lease payments under operating leases that had initial or remaining lease terms in excess of one year from September 30, 2015 were as follows (in thousands): Year Ending September 30, Amounts 2016 $ 2017 2018 2019 2020 Thereafter Total $ Guarantees and Indemnifications The Company, as permitted under Delaware law and in accordance with its certificate of incorporation and bylaws, and pursuant to indemnification agreements with certain directors, indemnifies its officers and directors for certain events or occurrences, subject to certain limits, while the officer or director is or was serving at the Company’s request in such capacity. The term of the indemnification period lasts as long as an officer or director may be subject to any proceeding arising out of acts or omissions of such officer or director in such capacity. The maximum amount of potential future indemnification is unlimited; however, the Company currently holds director and officer liability insurance. This insurance limits the Company’s exposure and may enable it to recover a portion of any future amounts paid. The Company believes that the fair value of these indemnification obligations is minimal. Accordingly, the Company has not recognized any liabilities relating to these obligations for any period presented. Contingencies The Company may be subject to legal proceedings and litigation arising in the ordinary course of business. The Company will record a liability when it believes that it is both probable that a loss has been incurred and the amount can be reasonably estimated. The Company expects to periodically evaluate developments in its legal matters that could affect the amount of liability that it has previously accrued, if any, and make adjustments as appropriate. Significant judgment is required to determine both the likelihood of there being, and the estimated amount of, a loss related to such matters, and the Company's judgment may be incorrect. The outcome of any proceeding is not determinable in advance. Until the final resolution of any such matters that the Company may be required to accrue for, there may be an exposure to loss in excess of the amount accrued, and such amounts could be material. Management is not aware of any legal matters in which the final disposition is expected to have a material effect on the business. See Note 15 for further discussion regarding product liabilities. On August 3, 2012, a wrongful death lawsuit was filed in the U.S. District Court for the Northern District of Texas, Boudreaux vs. Corium International, Inc., et al , naming Actavis Inc. and Actavis South Atlantic LLC (“Actavis”) and the Company as co-defendants. The parties have settled this suit and the settlement amount was covered by the Company’s insurance policy. Effective June 1, 2015, the case was dismissed with prejudice. |
Collaboration and Partner Arran
Collaboration and Partner Arrangements | 12 Months Ended |
Sep. 30, 2015 | |
Collaboration and Partner Arrangements. | |
Collaboration and Partner Arrangements | 10. Collaboration and Partner Arrangements The Company has recognized the following revenues from its collaboration and partner agreements during fiscal 2015, 2014, and 2013 (in thousands): Years ended September 30, 2015 2014 2013 Teva $ $ $ Par P&G Agile Aequus — Other Total revenues $ $ $ The Procter & Gamble Company In 2005, the Company entered into a multi-faceted collaboration arrangement with The Procter & Gamble Company, or P&G. The relationship includes a world-wide license to P&G for the use of certain of the Company's technologies for products in specific fields in which P&G operates. P&G paid the Company a $3.0 million fee for the license, and the Company is entitled to receive additional milestone payments for each qualifying product that the Company develops for P&G. In 2008, the Company received a $2.0 million milestone payment for the first series of products developed by the Company. In 2015, the Company received a $0.5 million milestone payment for the ex-U.S. commercial launch of a second product developed by the Company. P&G's license from the Company is perpetual and irrevocable. The Company entered into a long term joint development agreement under which the Company performs numerous development activities for P&G based upon agreed-upon statements of work and budgets. The development work performed by the Company under this agreement is billed to P&G on a time and materials basis, at cost. The P&G joint development agreement expires on June 13, 2020. The Company also entered into a commercial supply agreement for the production of all products developed by the Company for P&G. The Company has developed and commercialized several products which are currently marketed and sold by P&G under the brand name Crest Whitestrips. Several additional products are currently being developed by the Company for P&G, which are expected to launch in 2016 and beyond. The Company's current supply agreement with P&G was amended during 2014 and now expires on January 31, 2017. In addition to these agreements, and as part of the overall collaboration agreement, the Company also acquired certain patents from P&G in 2005. In exchange for the assignment of these patents, the Company issued 125,428 shares of our common stock as payment for the patents acquired. Teva Pharmaceuticals USA, Inc. In 2004, the Company entered into an arrangement with Barr Laboratories, or Barr, for four generic products. The Company also entered into three separate agreements with Barr, one in 2006 and two in 2007, to develop and commercialize three additional products. In 2008, Teva Pharmaceutical Industries, Ltd., or Teva, acquired Barr. Following this acquisition, Teva discontinued four of these development programs. Of the remaining three programs, one has resulted in an approved product, Clonidine Transdermal Delivery System (“TDS”), which is currently marketed by Teva, the second has been approved by the FDA for which Teva is currently assessing the launch strategy and timing, and the third product is pending regulatory approval. Under the Company's current agreements with Teva, the Company is not eligible for additional milestone payments. Under the agreements, the Company receives compensation for developing the products, generally on a time and materials basis. Once the products are commercialized, the Company generates product sales to Teva with a cost-plus margin and receives a profit share based on net profits (as defined in the agreements) earned by Teva for each product. The term of each commercial agreement with Teva extends, on a product-by-product basis, through the last day of the tenth full calendar year following the launch date of each product, with automatic one -year renewals. Par Pharmaceutical, Inc. On May 11, 2002, the Company entered into an arrangement to pursue development and commercialization of a generic version of the transdermal fentanyl product with Abrika LLLP. In 2007, Abrika was acquired by Actavis, Inc. Under the agreements, the Company agreed to develop the product and to assist Actavis with the regulatory filing and ultimate approval of such product. In October 2012, Actavis divested this product to Par who assumed the various agreements. Under the Company's current agreements, the Company is not eligible for additional milestone payments. The commercial agreement with Par has a term of twenty years, and expires on November 12, 2023. On June 26, 2015, the Company amended the agreements with Par, consisting of the Product Development, Collaboration and License Agreement and the Manufacturing and Supply Agreement for Transdermal Fentanyl, to amend the pricing and payment provisions and other business terms in exchange for, among other things, the termination of all of Par’s exclusive rights to products other than the fentanyl reservoir patch currently being manufactured by the Company for Par. The amended terms also include the elimination of the royalty obligations and establishes mutually agreeable transfer pricing. In September 2014, the Company recognized $1.8 million in non-cash product revenues which had previously been deferred since 2007. The one-time recognition of this revenue related to the expiration of a contractual liability under an agreement with Par, and will not have an impact on future revenues. Agile Therapeutics, Inc. In 2006, the Company entered into an arrangement with Agile to develop a new transdermal patch product using Agile’s previously developed technology. Under the arrangement, the Company has performed process development activities and manufacturing of the product (“Twirla”). For the development work performed, Agile paid the Company in several ways, including time and materials and milestones for achievement of certain development goals. During fiscal 2013 and 2012, Agile paid the Company $3.5 million for leasehold improvements incurred by the Company for its facilities to provide for adequate manufacturing space for this product once it is approved, which will be recognized as rental income in future years as the facility is used for production. In addition, for fiscal 2015, 2014 and 2013, Agile paid $1.0 million, $1.0 million and $0.6 million to the Company for idle facility charges, which are presented on the statement of operations and comprehensive loss as other revenues. Under the current agreements with Agile, the Company is not eligible for additional milestone payments. The term of the Company's contract with Agile continues until the Company has commercially produced an agreed-upon quantity of patches, currently projected to occur no earlier than five years following the commercial launch of Twirla. Aequus Pharmaceuticals, Inc. In April 2015, the Company entered into an agreement with Aequus Pharmaceuticals, Inc., or Aequus, to develop new transdermal products with an initial focus on neurological disorders. Under the agreement, for each product selected for development, the parties will assign an allocation of responsibilities, costs, rights and product revenues. Upon regulatory approval, the Company will manufacture the product and will be paid a profit share based on the Company’s interest in the product, which can vary based on the extent to which the Company’s technology is incorporated into the products and the Company’s funding of development work. In fiscal 2015 and 2014, the Company received $0. 2 million and $0.1 million in milestone payments related to development of the product. Other Partner Arrangements In 2013, the Company entered into an arrangement for the co-development of two generic transdermal products. In 2015, the development of one product was discontinued by mutual agreement due to reduced expectations regarding its commercial potential. Under the arrangement, the partner and the Company will continue to equally fund all costs of developing the remaining product. The Company will be reimbursed for its share of all out of pocket costs and will be required to reimburse the partner for its share of all development, clinical and other costs up to and including regulatory filing. The Company may be reimbursed for the development costs that it incurs through the payment of certain development milestones up to a total of $3.4 million for the remaining product, based on achieving certain stages of development. The Company received $0.5 million in development milestones upon signing the agreement and is amortizing the milestones into revenue over the expected development period of the products. In fiscal 2015, the Company received $1.1 million in milestone payments for the remaining product related to its achievement of development milestones. Upon regulatory approval, the Company will manufacture and sell the remaining product to the partner at cost with no margin and, provided that the Company has shared equally in all costs through regulatory approval, the Company will be paid a profit share equal to 50% of the net profits for the product. |
Warrants
Warrants | 12 Months Ended |
Sep. 30, 2015 | |
Warrants | |
Warrants | 11. Warrants The Company issued warrants to purchase shares of the Company's stock as part of several transactions from 2008 through 2013. The warrants have been recorded as either equity instruments or liability instruments based on the terms of the warrants. Preferred Stock Warrants As of September 30, 2013, the Company had issued warrants to purchase 1,739,992 shares of Series C preferred stock, with a weighted average exercise price of $0.90 per share, which comprised the only warrants to purchase preferred stock issued by the Company. All of the Series C preferred stock warrants were exercisable for a period of five years from issuance, except certain warrants to purchase 163,522 shares of Series C preferred stock which were set to expire upon the closing of an IPO, unless exercised. On April 8, 2014, in connection with the closing of the IPO, all of the warrants to purchase 163,522 shares of Series C convertible preferred stock that were otherwise set to expire upon completion of the IPO were net exercised and converted into 1,191 shares of common stock, and the remainder of the outstanding warrants to purchase 1,216,719 shares of Series C convertible preferred stock were converted into warrants to purchase 120,464 shares of common stock with a weighted average exercise price of $1.88 per share. In addition, the preferred stock warrant liability of $0.8 million was reclassified to stockholders’ equity. Common Stock Warrants As of September 30, 2015 and 2014, warrants to purchase 51,386 and 128,582 shares of common stock were outstanding with a weighted average exercise price of $9.26 and $8.69 per share, including 51,386 and 120,464 shares of preferred stock warrants that were converted into warrants to purchase common stock in connection with the IPO. All of the common stock warrants are exercisable at any time up to five years from issuance. The fair value of these warrants was recorded in stockholders’ equity upon issuance. The Company issued a warrant for the purchase of 8,118 shares of common stock with a fair value totaling $15,000 in connection with a lease arrangement that closed in September 2013. The fair value of the warrant upon issuance was calculated using the Black-Scholes option-pricing valuation model with the following assumptions: common stock value of $3.03 per share, contractual term of 5 years, risk-free interest rate of 1.41% , expected volatility of 76% , and expected dividend yield of 0% . This warrant was exercised during fiscal 2015. On April 8, 2014, in connection with the closing of the IPO, warrants to purchase 1,286,495 shares of common stock were net exercised into 970,249 shares of common stock. During fiscal 2015, warrants to purchase 12,591 shares of common stock were net exercised. |
Convertible Preferred Stock, Re
Convertible Preferred Stock, Redeemable Common Stock and Stockholders' Equity (Deficit) | 12 Months Ended |
Sep. 30, 2015 | |
Convertible Preferred Stock, Common Stock and Stockholders' Equity (Deficit) | |
Convertible Preferred Stock, Redeemable Common Stock and Stockholders' Deficit | 12. Convertible Preferred Stock, Redeemable Common Stock and Stockholders' Equity (Deficit) Convertible Preferred Stock The Company was authorized to issue up to 5.0 million shares of preferred stock as of September 30, 2015 and 2014 with a par value of $0.001 per share. As of September 30, 2015 and 2014, no preferred stock was outstanding. Common Stock In May 2015, the Company filed a shelf registration statement on Form S-3 (File No. 333-204025) with the SEC, which upon being declared effective in May 2015, allowed for the offer of up to $125.0 million of securities from time to time in one or more public offerings of common stock. In August 2015, the Company completed a public offering through which it sold an aggregate of 4,000,000 shares of common stock pursuant to the effective shelf registration statement at a price to the public of $13.00 per share. The Company received net proceeds of $48.6 million after deducting underwriting discounts and commissions and other issuance costs and expenses of $3.4 million. The Company was authorized to issue up to 150,000,000 shares of common stock as of September 30, 2015 and 2014 with a par value of $0.001 per share. The Company had reserved shares of common stock, on an as-if converted basis, for issuance as follows: As of September 30, 2015 2014 Issuances under stock option plans Issuances upon exercise of common stock warrants Issuances under the 2014 Employee Stock Purchase Plan Repurchases of Redeemable Common Stock from Founders — In connection with the 2007 Series C financing, the Company, in accordance with specific stock repurchase agreements approved by the board of directors, purchased from the two founders an aggregate of 215,872 shares of common stock at a purchase price of $9.26 per share. The stock repurchase agreements also provided for the Company to repurchase an additional 215,872 shares of common stock from each of the two founders at a price of $9.26 per share. These agreements were amended in March 2008 to suspend the Company’s obligation to repurchase these shares if, in the discretion of the Company’s board of directors, any such repurchase would result in a material adverse effect on the Company’s financial condition. As these shares were conditionally redeemable, they were classified outside of stockholders’ equity. As of September 30, 2013, the Company had a remaining agreement to repurchase 132,073 from one founder and 215,872 from the other founder, but such repurchase was contingent on approval by the board of directors. In December 2013, the Company entered into a revised repurchase agreement pursuant to which the Company agreed to repurchase 1,077,809 shares of the Company’s common stock from the founders, for an aggregate repurchase price of $5.2 million. On April 8, 2014, in connection with the closing of the IPO, the Company repurchased all 1,077,809 shares of common stock from the founders, thereby satisfying in full the Company’s remaining obligations under the earlier repurchase agreements. |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Sep. 30, 2015 | |
Stock-Based Compensation | |
Stock-Based Compensation | 13. Stock-Based Compensation Equity Incentive Plan As of September 30, 2015 and 2014, the Company had four equity incentive plans, all of which are sponsored by the Company, with the exception of the separate stock option plan of StrataGent, Inc., a corporation acquired by the Company on September 20, 2007 (the “StrataGent Plan”). The Company assumed all unexpired, unexercised options outstanding for those employees of StrataGent who remained Company employees after the merger. Each StrataGent option became exercisable into whole shares of Corium stock based on an agreed exchange ratio and per share exercise price such that the total value of the option grant did not change. The Company elected to make no further grants under the StrataGent Plan; however, its terms continue to govern all options issued under that plan. No additional shares available for grant were assumed by the Company, and any options that were returned to the pool subsequent to the merger were canceled and were not made available for future grants. This wholly-owned subsidiary was dissolved in 2008. As of September 30, 2015, all StrataGent options had been either exercised or canceled. On March 20, 2014, the Company’s board of directors approved the adoption of the 2014 Equity Incentive Plan (the “2014 Plan”), which became effective in connection with the IPO. Under the 2014 Plan, the Company had initially reserved a total of 1.0 million shares of common stock plus the remaining unissued shares under the Company’s 2012 Equity Incentive Plan (the “2012 Plan”), which had been adopted in November 2012 and was replaced by the 2014 Plan. The Company also sponsored the 2002 Stock Option Plan that expired in 2012. On January 1 of each year during the ten -year term of the 2014 Plan, the number of shares of common stock issuable under the 2014 Plan is automatically increased by an amount equal to up to 4% of the number of shares of common stock outstanding as of the preceding December 31, or such lesser number agreed to by the Company’s board of directors. On January 16, 2015, the Company’s board of directors authorized an increase of 722,834 shares to be added to the total number of shares of common stock issuable under the 2014 Plan. The exercise price of each option issued under each of the equity incentive plans is required to be no less than the fair market value of the Company’s common stock on the date of the grant. The maximum term of the options is ten years and the vesting period is typically four years. The term “Corium Plans” refers to the 2014 Plan, the 2012 Plan and the 2002 Stock Option Plan. Performance-Based Stock Option Grants - During the year ended September 30, 2013, the Company granted options to purchase 146,024 shares of common stock to certain executive officers and directors, which contained performance ‑based vesting criteria. These shares vest upon completion of certain milestone events which are specific to the Company’s corporate goals. Stock-based compensation expense associated with these performance-based stock options is recognized if the performance condition is considered probable of achievement using management’s best estimates. Following the closing of the IPO, the Compensation Committee of the Company’s board of directors determined that the performance ‑based criteria was met for options related to 137,510 shares of common stock and, accordingly, the Company has recorded stock ‑based compensation expense of $0.3 million for the year ended September 30, 2014 related to these performance-based stock options. As of September 30, 2015, 8,514 shares of common stock related to performance-based stock options were outstanding. No stock-based compensation expense related to performance-based stock options was recorded for the year ended September 30, 2015. A summary of activity under the Corium Plans during fiscal 2015, 2014 and 2013 is as follows: Weighted Weighted Average Shares Stock Average Remaining Aggregate Available Options Exercise Contractual Intrinsic Value for Grant Outstanding Price Life (Years) (In thousands) Balance - October 1, 2012 $ 5.20 Additional shares authorized — — Granted $ Exercised — $ Forfeited / Cancelled $ Balance - September 30, 2013 $ $ Additional shares authorized — — Granted $ Exercised — $ Forfeited / Cancelled $ Balance - September 30, 2014 $ $ Additional shares authorized — — Granted $ Exercised — $ Forfeited / Cancelled $ Balance - September 30, 2015 $ $ Options exercisable - September 30, 2015 $ $ Options vested and expected to vest - September 30, 2015 $ $ All outstanding options under the Corium Plans as of September 30, 2015 have an exercise price between $2.12 and $14.12 per share. The weighted average grant date fair value of options granted was $4.37 , $8.03 and $1.31 for fiscal 2015, 2014 and 2013. The Company estimated the fair value of stock options granted during fiscal 2015, 2014 and 2013 using the Black-Scholes option pricing model. The fair value of stock options is being amortized on a straight-line basis over the requisite service period of the awards. The fair value of the employee stock options was estimated using the following assumptions: Year Ended Year Ended Year Ended September 30, 2015 September 30, 2014 September 30, 2013 Expected term (in years) - - - Risk-free interest rate % - % % - % % - % Expected volatility % - % % - % % - % Expected dividend rate % % % A summary of activity under the StrataGent Plan for fiscal 2015, 2014 and 2013 is as follows: Weighted Average Remaining Aggregate Stock Options Weighted Average Contractual Life Intrinsic Outstanding Exercise Price (Years) Value (In thousands) Balance — October 1, 2012 $ Exercised $ Forfeited $ Balance - September 30, 2013 $ $ Balance - September 30, 2014 $ $ Exercised $ Balance - September 30, 2015 — $ — — $ — Options exercisable September 30, 2015 — $ — — $ — Options vested and expected to vest September 30, 2015 — $ — — $ — There were no options granted under the StrataGent Plan during fiscal 2015, 2014 or 2013. All outstanding options under the StrataGent Plan have been cancelled or exercised as of September 30, 2015. 2014 Employee Stock Purchase Plan On March 20, 2014, the Company’s board of directors approved the adoption of the 2014 Employee Stock Purchase Plan (the “2014 ESPP”), which became effective in connection with the IPO. On January 1 of each year for the ten year term of the plan, the number of shares issuable under the 2014 ESPP can be increased by an amount equal to up to 1% of the number of shares of common stock and common stock equivalents outstanding as of the preceding December 31, or a lesser number agreed to by the Company’s board of directors. No more than 4.0 million shares may be issued over the ten year term of the 2014 ESPP without the consent of the Company’s stockholders. Shares subject to purchase rights granted under the Company’s 2014 ESPP that terminate without having been exercised in full will not reduce the number of shares available for issuance under the Company’s 2014 ESPP. The Company initially reserved 310,000 shares of common stock for issuance pursuant to the 2014 ESPP upon its adoption and, on January 16, 2015, the Company’s board of directors reserved an additional 181,994 shares of common stock for issuance pursuant to the 2014 ESPP. As of September 30, 2015, the total reserve available for issuance pursuant to the 2014 ESPP was 372,529 shares of common stock, which reserve is net of issuances of 119,465 shares of common stock. The 2014 ESPP is intended to qualify as an “employee stock purchase plan,” under Section 423 of the Internal Revenue Code of 1986 for the purpose of providing employees with an opportunity to purchase the Company’s common stock through accumulated payroll deductions. The 2014 ESPP provides for a 24 -month offering period with four consecutive six ‑ month purchase periods during each offering period. Employees are able to purchase shares of common stock at 85% of the lower of the fair market value of the Company’s common stock on the first day of the offering period (the “Offering Date”) or on the last day of each six -month purchase period (the “Purchase Date”). The closing price as quoted by the Nasdaq is deemed to be the fair value of the Company’s common stock on the Offering Date or the Purchase Date, or if there are no sales on such date, then the last preceding business day on which there were sales. In the event that the closing price of the Company's common stock on the Purchase Date is lower than it was on the Offering Date, then all participating employees may re-enroll in a new 24 -month offering period that commences the day following the Purchase Date. The fair value of the purchase rights granted under the 2014 ESPP between April 2, 2014 and May 19, 2015 and the offering periods commencing on November 20, 2014 and May 20, 2015 were estimated by applying the Black- Scholes option-pricing model to each of the four purchase periods in each offering period using the following assumptions: Year Ended September 30, 2015 Fair value of common stock $ – Grant price $ – Expected term (in years) – Expected volatility % – % Risk-free interest rate % – % Expected dividend rate % Fair Value of Common Stock — The fair market value of the Company’s common stock on the first day of each offering period, or $8.00 for the first offering period, based on the Company's IPO price, $5.49 for the offering period commencing on November 20, 2014, and $12.31 for the offering period commencing on May 20, 2015. Grant Price — 85% of the fair market value of the Company’s common stock on the first day of each offering period, or $6.80 for the first offering period, $4.67 for the offering period commencing November 20, 2014, and $10.46 for the offering period commencing May 20, 2015. Expected Term — The expected term is based on the end dates of the four purchase periods of each offering period under the 2014 ESPP, which are either six , twelve , eighteen or twenty four months. Expected Volatility — Because the Company has limited information on the volatility of its common stock due to a lack of significant trading history and limited historical data regarding the volatility of its common stock, the expected volatility used is based on the volatility of a group of comparable publicly traded companies. In evaluating comparability, the Company considered factors such as industry, stage of life cycle and size. The Company will continue to analyze the historical stock price volatility and term assumptions as more historical data for the Company’s common stock becomes available. Risk-Free Interest Rate — The risk-free interest rate is based on the constant maturity yields of U.S. Treasury notes with remaining maturities similar to each expected term. Expected Dividend Rate — The Company has never paid any dividends, does not plan to pay dividends in the foreseeable future, and, therefore, uses an expected dividend rate of zero in the valuation model. For the years ended September 30, 2015 and 2014, the Company recorded stock-based compensation expense of $0.5 million and $0.3 million and for the year ended September 30, 2015, the Company issued 119,465 shares of common stock to employees related to the 2014 ESPP. Stock-Based Compensation Expense Employee stock-based compensation expense for fiscal 2015, 2014 and 2013 is classified in the statements of operations and comprehensive loss as follows (in thousands): Year ended September 30, 2015 2014 2013 Cost of product revenues $ $ $ Cost of contract research and development revenues Research and development General and administrative Total stock-based compensation $ $ $ As of September 30, 2015, there was a total of $5.2 million of unrecognized employee compensation cost, net of estimated forfeitures, related to non-vested stock option awards and the 2014 ESPP, which is expected to be recognized on a straight-line basis over a weighted-average period of approximately 2.7 years. |
Product Recall Liability
Product Recall Liability | 12 Months Ended |
Sep. 30, 2015 | |
Product Recall Liability | |
Product Recall Liability | 14. Product Recall Liability In fiscal 2008 and fiscal 2010, Actavis issued two voluntary recalls of certain lots and strengths of Fentanyl TDS manufactured by the Company and sold and distributed by Actavis in the United States. The Company and Actavis negotiated financial settlements for these two recalls, and the Company accrued amounts related to these settlements in fiscal 2009 and 2011. Such recall liabilities were subsequently reduced through various mechanisms per the terms of the settlement agreements. In October 2012, the Company reached a revised settlement related to the two recalls which provided for a total and combined remaining liability of $5.0 million as of September 30, 2012. The revised liability will be repaid through quarterly payments in arrears based on a percentage of the average of the total net revenues recorded by the Company related to Fentanyl TDS. These quarterly payments have been paid to Actavis since July 1, 2013 and will continue through April 1, 2017. To the extent that the revised settlement liability is not repaid as of April 1, 2017, the remaining liability, if any, will be converted into the most recent form of capital stock issued by the Company in connection with a financing, at the price per share of that financing. The revised liability does not accrue interest. During fiscal 2015 and 2014, the Company repaid $0.7 million and $1.1 million of this liability . The following table summarizes the changes to the product recall liability (in thousands): Year Ended September 30, 2015 2014 2013 Beginning balance $ $ $ Payment of settlement liability Ending balance $ $ $ |
Product Liability
Product Liability | 12 Months Ended |
Sep. 30, 2015 | |
Product Liability | |
Product Liability | 15. Product Liability As discussed in Note 9, there are other potential liabilities that the Company may incur relating to the products it manufactures, including potential product liability claims. For fiscal 2015, 2014 and 2013, the Company has provided a reserve for these potential claims taking into account the insurance coverage maintained for such claims, the nature and extent of such claims, and the Company's past success in defending and/or settling such claims. The Company does not expect a material financial impact to arise from such claims to date. The following table summarizes the changes to the product liability reserve (in thousands): Year Ended September 30, 2015 2014 2013 Beginning balance $ $ $ Settlement payments — — Expense (income) Ending balance $ $ $ |
Net Loss and Net Loss per Share
Net Loss and Net Loss per Share Attributable to Common Stockholders | 12 Months Ended |
Sep. 30, 2015 | |
Net Income (Loss) and Net Income (Loss) per Share Attributable to Common Stockholders | |
Net Loss and Net Loss per Share Attributable to Common Stockholders | 16. Net Loss and Net Loss per Share Attributable to Common Stockholders The following table sets forth the computation of the Company's basic and diluted net loss per share attributable to common stockholders during fiscal 2015, 2014 and 2013 (in thousands, except share and per share data): Year Ended September 30, 2015 2014 2013 Net loss attributable to common stockholders, basic and diluted $ $ $ Weighted average shares used in computing net loss per share attributable to common stockholders, basic and diluted Net loss per share attributable to common stockholders, basic and diluted $ $ $ The following outstanding shares of common stock equivalents were excluded from the computation of the diluted net loss per share attributable to common stockholders for the periods presented because including them would have been antidilutive: Year Ended September 30, 2015 2014 2013 Convertible preferred stock — — Stock options to purchase common stock Shares authorized under the 2014 ESPP — Common stock warrants Preferred stock warrants — — |
Income Taxes
Income Taxes | 12 Months Ended |
Sep. 30, 2015 | |
Income Taxes | |
Income Taxes | 17. Income Taxes The Company did not record a provision for Federal income taxes for fiscal 2015, 2014 or 2013, due to its net operating losses in the periods. The Company's effective tax rate differs from the statutory federal income tax rate, primarily as a result of the net operating loss carryforwards and research and development tax credit carryforwards. For purposes of Federal income taxes, the Company operates in only one jurisdiction, the United States. The following table presents a reconciliation of the tax expense (benefit) computed at the statutory federal rate and the Company's tax expense (benefit) for the period presented (in thousands): Year Ended September 30, 2015 2014 2013 Income tax benefit — computed as 34% of pretax loss $ $ $ Effect of nondeductible expenses State and local income tax expenses Valuation allowance Effect of tax credits and other State deferred taxes Other — Total $ $ $ The tax effects of temporary differences and carryforwards that give rise to significant portions of deferred tax assets and liabilities as of September 30, 2015 and 2014 are as follows (in thousands): As of September 30, 2015 2014 Deferred tax assets: Net operating loss carryforward $ $ Depreciation Accrued expenses Research and development tax credit State deferred taxes Other Gross deferred tax assets Valuation allowance Net deferred tax assets Deferred tax liabilities: Other Gross deferred tax liabilities Net deferred tax liabilities $ — $ — As of September 30, 2015, the Company had net operating loss carryforwards for federal and state income tax purposes of $103.3 million and $16.3 million. These net operating loss carryforwards will expire, if not utilized, beginning in 2026 and 2017 for federal and state income tax purposes. Realization of deferred tax assets is dependent on future taxable income, the existence and timing of which is uncertain. Based on the Company's history of losses, management has determined it cannot conclude that it is more likely than not that the deferred tax assets will be realized, and accordingly has placed a full valuation allowance on its net deferred tax assets. The valuation allowance increased by $9.7 million and $2.5 million in fiscal 2015 and 2014. As of September 30, 2015, the Company had tax credit carryforwards of $2.2 million and $1.7 million available to reduce future taxable income, if any, for federal and California state income tax purposes. The federal tax credit carryforwards begin to expire in 2022. California tax credits have no expiration date. The Tax Reform Act of 1986 and similar California legislation impose substantial restrictions on the utilization of net operating losses and tax credits in the event of an ownership change of a corporation. Accordingly, the Company's ability to utilize net operating losses and tax credit carryforwards may be significantly limited in the future as a result of such an ownership change. The Company had unrecognized tax benefits (“UTBs”) of approximately $0.2 million as of September 30, 2015. The net deferred tax assets associated with these UTBs are fully offset by a valuation allowance. The Company did not have any material unrecognized tax benefits as of September 30, 2014. The following table summarizes the activity related to the UTBs (in thousands): As of September 30, 2015 Balance - September 30, 2014 $ — Increases related to current year tax provisions — Increases related to prior year tax provisions Balance - September 30, 2015 $ All of these UTBs, if recognized, would affect the effective tax rate before consideration of the valuation allowance. It is difficult to predict the final timing and resolution of any particular uncertain tax position. Based on the Company's assessment, including experience and complex judgments about future events, the Company does not expect that changes in the amount of UTBs during the next 12 months will have a significant impact on the Company's financial position or results of operations. It is the Company's policy to include penalties and interest expense related to income taxes as a component of other expense and interest expense, as necessary. There were no interest expense or penalties related to the UTBs recorded through September 30, 2015. The Company files income tax returns in the U.S. federal jurisdiction as well as in California, Michigan, and New Jersey. The tax years ending September 30, 2011 to September 30, 2014 remain open to examination by the jurisdictions in which the Company is subject to tax. Fiscal years outside the normal statute of limitation remain open to audit by tax authorities due to tax attributes generated in those early years, which have been carried forward and may be audited in subsequent years when utilized. |
Employee Benefit Plan
Employee Benefit Plan | 12 Months Ended |
Sep. 30, 2015 | |
Employee Benefit Plan | |
Employee Benefit Plan | 18. Employee Benefit Plan The Company has a defined-contribution retirement plan that allows for discretionary contributions from the Company. Contributions totaled $101,000 , $93,000 and $90,000 for fiscal 2015, 2014 and 2013. |
Segment and Enterprise-Wide Inf
Segment and Enterprise-Wide Information | 12 Months Ended |
Sep. 30, 2015 | |
Segment and Enterprise-Wide Information | |
Segment and Enterprise-Wide Information | 19. Segment and Enterprise-Wide Information The Company's chief operating decision maker is its President and Chief Executive Officer. The President and Chief Executive Officer reviews the Company’s operating results on an aggregate basis for purposes of allocating resources and evaluating financial performance. The Company has one business activity and there are no segment managers who are held accountable for operations, or operating results for levels or components. Accordingly, the Company has a single reporting segment and operating unit structure. All of the Company's revenues are derived from partners located primarily in North America and all long-lived assets are located in the United States. |
Selected Quarterly Financial Da
Selected Quarterly Financial Data (Unaudited) | 24 Months Ended |
Sep. 30, 2015 | |
Selected Quarterly Financial Data (Unaudited) | |
Selected Quarterly Financial Data (Unaudited) | 20. Selected Quarterly Financial Data (Unaudited) Selected quarterly results from operations for the years ended September 30, 2015 and 2014 are as follows (in thousands, except per share amounts): Fiscal 2015 Quarter Ended December 31, 2014 March 31, 2015 June 30, 2015 September 30, 2015 Total revenue $ $ $ $ Operating expenses $ $ $ $ Net loss $ $ $ $ Basic and diluted net loss per common share $ $ $ $ Fiscal 2014 Quarter Ended December 31, 2013 March 31, 2014 June 30, 2014 September 30, 2014 Total revenue $ $ $ $ Operating expenses $ $ $ $ Net income (loss) $ $ $ $ Basic net income (loss) per common share $ $ $ $ Diluted net income (loss) per common share $ $ $ $ |
Subsequent Events
Subsequent Events | 12 Months Ended |
Sep. 30, 2015 | |
Subsequent Events | |
Subsequent Events | 21. Subsequent Events On November 11, 2015, the Company’s term loan agreement (see Note 8) was amended to modify the financial covenants for minimum annual revenues, beginning with the 12 months ending June 30, 2016, and minimum liquidity. The Company has been in continuous compliance with the financial covenants since the inception of the loan. * * * ** |
Organization, Description of 28
Organization, Description of Business, and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Sep. 30, 2015 | |
Organization, Description of Business, and Summary of Significant Accounting Policies | |
Basis of Presentation | Basis of Presentation The Company's financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). |
Reverse Stock Split | Reverse Stock Split On March 20, 2014, the Company effected a 1-for-10.1 reverse stock split of the Company’s outstanding common stock resulting in a reduction of the Company’s total common stock issued and outstanding from 19,032,056 shares to 1,884,362 shares. The reverse stock split affected all stockholders of the Company’s common stock uniformly, and did not materially affect any stockholder’s percentage of ownership interest. The par value of the Company’s common stock remained unchanged at $0.001 per share and the number of authorized shares of common stock remained the same after the reverse stock split. In connection with this reverse stock split, the number of shares of common stock reserved for issuance under the Company’s equity incentive, stock option and employee stock purchase plans, as well as the shares of common stock underlying outstanding stock options and warrants, were also proportionately reduced while the exercise prices of such stock options and warrants were proportionately increased. All references to shares of common stock and per share data for all periods presented in the accompanying financial statements and notes thereto have been adjusted to reflect the reverse stock split on a retroactive basis. |
Initial Public Offering | Initial Public Offering In April 2014, the Company sold 6,874,997 shares of its common stock in its initial public offering (the “IPO”) at a price of $8.00 per share. The Company received net cash proceeds of $48.5 million from the IPO, including proceeds from the partial exercise of the underwriters’ option, after deducting underwriting discounts, commissions and issuance costs paid by the Company, which totaled $6.5 million. On April 8, 2014, immediately prior to the closing of the IPO, all outstanding shares of convertible preferred stock were converted into 3,567,807 shares of common stock, and the related carrying value of $57.3 million was reclassified to common stock and additional paid-in capital. In addition, certain warrants to purchase convertible preferred stock and common stock were converted and net exercised into 971,440 shares of common stock. In connection with the IPO, Corium also repurchased 1,077,809 shares of common stock from its founders for an aggregate purchase price of $5.2 million. Following the filing of the Restated Certificate of Incorporation of the Company on April 8, 2014, the number of shares of capital stock the Company is authorized to issue is 155,000,000 shares, of which 150,000,000 shares may be common stock and 5,000,000 shares may be preferred stock. Both the common stock and preferred stock have a par value of $0.001 per share. |
Use of Estimates | Use of Estimates Estimates and assumptions are required to be used by management in the preparation of financial statements in conformity with U.S. GAAP that affect the reported amounts of assets, liabilities, and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of operating revenues and operating expenses during the reporting period. Those estimates and assumptions affect revenue recognition and deferred revenues, impairment of long-lived assets, determination of fair value of stock-based awards and other debt- and equity- related instruments, and accounting for income taxes. As future events and their effects cannot be determined with precision, actual results could differ from those estimates. |
Concentration of Credit Risk | Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist of cash and cash equivalents and accounts receivable. The Company maintains its cash and cash equivalents with a single domestic financial institution that is well capitalized. The Company provides credit, in the normal course of business, to its partners and performs credit evaluations of such partners. In fiscal 2015, three partners accounted for 82 % of the Company’s revenues and 84% of accounts receivable as of September 30, 2015. In fiscal 2014 and 2013, four partners accounted for 95% and 99% of the Company's revenues and 95% of accounts receivable as of September 30, 2014. |
Comprehensive Income (Loss) | Comprehensive Income (Loss) During fiscal 2015, 2014 and 2013, the Company did not recognize any other comprehensive income (loss) and, therefore, the net loss and comprehensive loss was the same for all periods presented. |
Revenue Recognition | Revenue Recognition The Company generates revenues from agreements for the development and commercialization of its products. The terms of the agreements may include nonrefundable upfront payments, partial or complete reimbursement of research and development costs, milestone payments, product sales, and profit sharing and royalties on partners’ product sales of products that we manufacture on their behalf. The Company recognizes revenues when the following criteria are met: persuasive evidence of a sales or service arrangement exists; delivery has occurred; the price is fixed or determinable; and collectability is reasonably assured. Revenue related to multiple element arrangements are analyzed to determine whether the deliverables can be separated or whether they must be accounted for as a single unit of accounting. This determination is generally based on whether any deliverable has stand-alone value to the partner. This analysis also establishes a selling price hierarchy for determining how to allocate arrangement consideration to identified units of accounting. The selling price used for each unit of accounting is based on vendor-specific objective evidence, if available, third-party evidence if vendor-specific objective evidence is not available, or estimated selling price if neither vendor-specific nor third-party evidence is available. Typically, the Company has not granted licenses to partners at the beginning of its arrangements and, thus, there are no delivered items separate from the research and development services provided. As such, upfront payments are recorded as deferred revenues in the balance sheet and are recognized as contract research and development revenues over the estimated period of performance that is consistent with the terms of the research and development obligations contained in the agreement. The Company periodically reviews the estimated period of performance based on the progress made under each arrangement. Amounts related to research and development funding are generally recognized as the related services or activities are performed in accordance with the contract terms. To the extent that agreements specify services are to be performed on a cost ‑plus basis, revenues are recognized as services are rendered. Such work is generally billed on a monthly basis for time incurred at specified rates in the agreements. To the extent that agreements specify services to be performed on a fixed-price basis, revenues are recognized consistent with the pattern of the work performed. Many of the agreements provide for reimbursement of third-party expenses, and such reimbursable expenses are billed as revenues at the time the associated expenses are incurred. The arrangements may include contractual milestones, which relate to the achievement of pre-specified research, development, regulatory and commercialization events. The milestone events contained in the Company's arrangements coincide with the progression of the products from research and development, to regulatory approval, and through to commercialization. The process of successfully developing a new product, having it approved from a regulatory perspective and ultimately sold for a profit is highly uncertain. As such, the milestone payments that the Company is eligible to earn from its partners involve a significant degree of risk to achieve. Research and development milestones in the Company's partner arrangements may include the following types of events: completion of pre-clinical research and development work, completion of certain development events and initiation or completion of clinical trials. Regulatory milestones may include the following types of events: filing of regulatory applications with the Food and Drug Administration and approval of the regulatory applications by the Food and Drug Administration. Commercialization milestones generally relate to product launch. The Company recognizes milestone payments in their entirety in the period in which the milestone is achieved. Upon commercialization, revenues are generated from product sales, royalties and profit sharing. Product sales are generally recognized as products are shipped and title and risk of loss pass to the partner. Royalties and profit sharing are generally recognized when the partners sell the product to their customers, which could be in a different accounting period than the period in which the Company sold that product to its partner, and are based on a percentage of the partners' net sales of or net profits on the products. Product sales and royalty income are presented collectively as product revenues. Royalties and profit sharing totaled $2.3 million, $6.7 million and $7.8 million for fiscal 2015, 2014 and 2013. Other revenues consists of income derived from the Company's arrangements with its partners, whereby a portion of the revenues received under these agreements relates to rental income from embedded leases associated with manufacturing equipment and facilities specific to these relationships, as well as revenues associated with licenses granted to our partners, whereby the Company receives milestone payments upon commercial launch of each new product developed by the Company using the Company’s intellectual property. |
Research and Development | Research and Development Expenses Research and development expenses primarily comprise salaries and benefits associated with research and development personnel, overhead and facility costs, pre-clinical and non-clinical development costs, clinical trial, and related clinical manufacturing costs, contract services, and other outside costs. Research and development costs, including costs to be subsequently reimbursed under development contracts, are charged to expense when incurred. |
Advertising Costs | Advertising Costs The Company's advertising expenses were immaterial for fiscal 2015, 2014 and 2013. |
Stock-Based Compensation | Stock-Based Compensation The Company accounts for stock-based compensation for all share-based awards made to employees and directors, including employee stock options and employee stock purchases related to the Employee Stock Purchase Plan, by measuring the cost of awards of equity instruments based on the grant-date fair value of the award. The Company determines the fair value of such awards using the Black-Scholes option-pricing model (the "Black-Scholes model"). The Black-Scholes model for stock options incorporates certain assumptions as follows: Expected Term — The expected term represents the period that the stock-based awards are expected to be outstanding before exercise or cancellation. As the Company's historical share exercise experience did not provide a reasonable basis upon which to estimate expected term because of a lack of sufficient data points, the Company estimated the expected term by using the midpoint between the vesting commencement date and the contractual expiration period of the stock-based award. Risk-Free Interest Rate — The risk-free interest rate is based on the constant maturity yields of U.S. Treasury notes with remaining maturities similar to the expected term. Expected Volatility — Because the Company has limited information on the volatility of its common stock due to a lack of significant trading history and limited historical data regarding the volatility of its common stock, the expected volatility used is based on volatility of a group of comparable publicly traded companies. In evaluating comparability, the Company considered factors such as industry, stage of life cycle and size. The Company will continue to analyze the historical stock price volatility and term assumptions as more historical data for the Company’s common stock becomes available. Expected Dividend –– The Company has never paid any dividends, does not plan to pay dividends in the foreseeable future, and, therefore, uses an expected dividend rate of zero in the valuation model. The Company recognizes compensation expense for stock options for the portion of the share-based awards that are expected to vest. Therefore, the Company applied estimated forfeiture rates that were derived from historical employee termination behavior. If the actual number of forfeitures differs from those estimated by management, additional adjustments to compensation expense may be required in future periods. |
Income Taxes | Income Taxes The Company accounts for income taxes based on the liability method. Under the liability method, deferred tax assets and deferred tax liabilities are recognized for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and deferred tax liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and deferred tax liabilities of a change in tax rates is recognized in operations in the period that includes the enactment date. A valuation allowance is established when it is more likely than not that all or a portion of a deferred tax asset will not be realized. Financial statement effects of uncertain tax positions are recognized when it is more likely than not, based on the technical merits of the position, that it will be sustained upon examination. |
Net Loss per Share Attributable to Common Stockholders | Net Loss per Share Attributable to Common Stockholders The Company calculates its basic and diluted net loss per share attributable to common stockholders in conformity with the two-class method required for companies with participating securities. The Company's basic net loss per share attributable to common stockholders is calculated by dividing the net loss attributable to common stockholders by the weighted average number of shares of common stock outstanding for the period. The diluted net loss per share attributable to common stockholders is computed by giving effect to all potential dilutive common stock equivalents outstanding for the period. For purposes of the diluted calculation, convertible preferred stock, options to purchase common stock, shares authorized under the employee stock purchase plan and common stock warrants are considered common stock equivalents but are excluded from the calculation of diluted net loss per share attributable to common stockholders if their effect is antidilutive. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid investments with original maturities of three months or less at the date of purchase to be cash equivalents. The Company generally invests funds that are in excess of current needs in high ‑credit ‑quality instruments, such as money market funds. |
Accounts Receivable and Allowance for Doubtful Accounts | Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable are stated at invoiced amounts. An allowance for doubtful accounts is established as needed based on a specific assessment of all invoices that remain unpaid following normal partner payment periods. All amounts deemed to be uncollectible are charged against the allowance for doubtful accounts in the period that the determination is made. The allowance for doubtful accounts was $0 as of September 30, 2015 and 2014. |
Inventories | Inventories Inventories are stated at the lower of cost, on a first-in, first-out basis, or market. The Company records an allowance for excess and obsolete inventory based on anticipated obsolescence, usage, and historical write-offs. |
Property and Equipment | Property and Equipment Property and equipment are recorded at cost, net of accumulated depreciation and amortization. Equipment is depreciated over its useful life, ranging from 3 to 8 years using the straight-line method. Leasehold improvements are depreciated or amortized over the shorter of the lease term or their useful lives ranging from 3 to 15 years using the straight-line method. Expenditures for maintenance and repairs are charged to expense as incurred. |
Capital Leases | Capital Leases The Company leases several pieces of equipment under capital lease arrangements. Equipment leased under capital leases is amortized over the life of the lease term using the straight-line method. |
Intangible Assets | Intangible Assets Intangible assets consist primarily of the cost of acquired patents and legal costs associated with patent development and contract acquisition costs. These costs are capitalized and amortized on a straight-line basis over the lesser of the estimated economic lives of the patents or the underlying contracts and the remaining legal lives of the patents, which approximates the consumption over the estimated useful lives of the assets, once a patent is granted. The Company periodically reevaluates the original assumptions and rationale utilized in the establishment of the carrying value and estimated lives of these assets. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets Long-lived assets to be held and used are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Determination of recoverability is based on an estimate of undiscounted future cash flows resulting from the use of the assets and their eventual disposition. Measurement of an impairment loss for long-lived assets that management expects to hold and use is based on the fair value of the asset. No impairment was recorded for fiscal 2015, 2014 or 2013. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Fair value accounting is applied for all financial assets and liabilities and non-financial assets and liabilities that are recognized or disclosed at fair value in the financial statements on a recurring basis (at least annually). Assets and liabilities recorded at fair value in the financial statements are categorized based upon the level of judgment associated with the inputs used to measure their fair value. Hierarchical levels, which are directly related to the amount of subjectivity associated with the inputs to the valuation of these assets or liabilities, are as follows: Level I — Inputs that are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date. Level II — Inputs that are observable, unadjusted quoted prices in active markets for similar assets or liabilities, unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the related assets or liabilities; and Level III — Unobservable inputs that are significant to the measurement of the fair value of the assets or liabilities that are supported by little or no market data. |
Convertible Preferred Stock Warrants | Convertible Preferred Stock Warrants Prior to their conversion into common stock on April 8, 2014 in connection with the Company’s IPO, the Company accounted for certain warrants to purchase shares of convertible preferred stock as liabilities at fair value, as it had determined that some of these warrants were derivative instruments because they contained antidilution provisions that protected the holders from certain equity issuances at a price below the original issue price of the underlying security. The Company remeasured these warrants to fair value at each balance sheet date, and recognized any change in the fair value as a change in the warrant liability in its statements of operations and comprehensive loss. The Company estimated the fair value of these warrants at the respective balance sheet dates using the Probability-Weighted Expected Return Method (“PWERM”), in fiscal 2013 and 2014. The Company used a number of assumptions to estimate the fair value, including the likelihood of various scenarios, the expected volatility, and the fair value of the underlying stock under each scenario. This liability was reclassified to equity in fiscal 2014 in connection with the Company’s IPO. |
Subordinated Note Embedded Derivative Liability | Subordinated Note Embedded Derivative Liability Prior to its conversion into common stock on April 8, 2014 in connection with the Company’s IPO, the Company had an outstanding subordinated note that the Company had determined contained an embedded derivative instrument related to redemption and conversion features of the note. These features required bifurcation and separate accounting, and the embedded derivative was accounted for as a liability. The embedded derivative liability was remeasured to fair value at each balance sheet date, with the corresponding gain or loss from the adjustment recorded in the statements of operations and comprehensive loss. The fair value of the embedded derivative was measured with the PWERM valuation method. Under this method, fair value is primarily driven by the assessment of the probability and timing of scenarios that could result in the redemption of the note prior to the note's maturity, which would trigger the payment of the additional amount equal to the outstanding principal of the subordinated note. |
Recent Account Pronouncements | Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board issued ASU No. 2014-09, “Revenue from Contracts with Customers”, Topic 606. This ASU affects any entity that either enters into contracts with customers to transfer goods or services or enters into contracts for the transfer of nonfinancial assets, unless those contracts are within the scope of other standards. The guidance in this ASU supersedes the revenue recognition requirements in Topic 605, Revenue Recognition and most industry-specific guidance. The core principle of the guidance is that an entity should recognize revenue to illustrate 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. The new guidance also includes a set of disclosure requirements that will provide users of financial statements with comprehensive information about the nature, amount, timing, and uncertainty of revenue and cash flows arising from a reporting organization’s contracts with customers. In August 2015, the Financial Accounting Standards Board issued ASU No. 2015-14, “ Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date ”, which defers the effective date of ASU 2014-09 by one year. The ASU is effective for annual reporting periods, and interim periods within those years, beginning after December 15, 2017 for public companies and permits the use of either the retrospective or cumulative effect transition method, with early application permitted as of annual reporting periods beginning after December 15, 2016, including interim reporting periods within those annual periods . The Company is evaluating the effect, if any, that this ASU may have on the Company’s financial position and results of operations. In April 2015, Financial Accounting Standards Board issued ASU No. 2015-03, “Simplifying the Presentation of Debt Issuance Costs.” This ASU requires debt issuance costs to be presented in the balance sheet as a reduction of the related liability rather than an asset. This ASU is effective for annual reporting periods beginning after December 15, 2015, including interim periods within that reporting period, and is to be applied retrospectively; early adoption is permitted. The adoption of this standard is not expected to have a material impact on the Company’s financial statements. In July 2015, the Financial Accounting Standards Board issued ASU No. 2015-11, “Inventory (Topic 330): Simplifying the Measurement of Inventory.” This ASU applies to inventory that is measured using first-in, first-out or average cost. Inventory within the scope of this update is required to be recorded at the lower of cost or net realizable value, which is the estimated selling price in the ordinary course of business less reasonably predictable costs of completion, disposal and transportation. This ASU is effective prospectively for annual reporting periods beginning after December 15, 2016, and interim periods thereafter; early adoption is permitted. The adoption of this standard is not expected to have a material impact on the Company’s financial statements. In November 2015, the Financial Accounting Standards Board issued ASU No. 2015-17, “Balance Sheet Classification of Deferred Taxes.” This ASU requires entities to present deferred tax assets and deferred tax liabilities as noncurrent in a classified balance sheet. This ASU is effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period, and entities are permitted to apply either prospectively or retrospectively; early adoption is permitted. The adoption of this standard is not expected to have a material impact on the Company’s financial statements. |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
Fair Value Measurements | |
Schedule of the Company's financial assets that are measured at fair value on a recurring basis by level within the fair value hierarchy | The Company's financial instruments that are measured at fair value on a recurring basis as of September 30, 2015 and 2014, by level within the fair value hierarchy, are as follows (in thousands): As of September 30, 2015 Level I Level II Level III Total Financial Assets: Money market funds $ $ — $ — $ As of September 30, 2014 Level I Level II Level III Total Financial Assets: Money market funds $ $ — $ — $ |
Summary of the changes in the fair value of the Company's Level III financial liabilities, which are measured on a recurring basis | The following table sets forth a summary of the changes in the fair value of the Company's Level III financial liabilities, which are measured on a recurring basis (in thousands): Year Ended September 30, 2014 Beginning balance $ Change in fair value of preferred stock warrant liability Change in fair value of subordinated note embedded derivative liability Extinguishment of preferred stock warrant liability Ending balance $ — |
Schedule of differences between carrying values and estimated fair value of financial instruments | The following financial liabilities have carrying values which differ from their fair value as estimated by the Company based on market quotes for instruments with similar terms and remaining maturities (Level III valuation) (in thousands): As of September 30, 2015 Carrying Fair Value Value Difference Long-term debt $ $ $ As of September 30, 2014 Carrying Fair Value Value Difference Long-term debt $ $ $ |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
Inventories | |
Schedule of Inventories | Inventories consist of the following (in thousands): As of September 30, 2015 2014 Raw materials $ $ Work in process Finished goods Total inventories, cost Less inventory reserves Total inventories, net $ $ |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
Property and Equipment | |
Schedule of property and equipment | Property and equipment consist of the following (in thousands): As of September 30, 2015 2014 Machinery and equipment $ $ Manufacturing equipment acquired under capital leases Transportation equipment Furniture and fixtures Computer equipment and software Leasehold improvements Land Construction in progress Total property and equipment, gross Accumulated depreciation and amortization Total property and equipment, net $ $ |
Intangible Assets (Tables)
Intangible Assets (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
Intangible Assets | |
Schedule of intangible assets and related accumulated amortization | Intangible assets and related accumulated amortization consist of the following (in thousands): As of September 30, 2015 2014 Cost: Patents and trademarks $ $ Contract acquisition costs Total carrying value Accumulated amortization: Patents and trademarks Contract acquisition costs Total accumulated amortization Total intangible assets, net $ $ |
Patents and trademarks | |
Intangible assets | |
Schedule of estimated remaining annual amortization expenses | The estimated remaining annual amortization expenses for issued patents and trademarks as of September 30, 2015 are as follows (in thousands): Year Ending September 30: Amounts 2016 $ 2017 2018 2019 2020 Thereafter Total $ |
Contract acquisition cost | |
Intangible assets | |
Schedule of estimated remaining annual amortization expenses | The estimated remaining annual amortization expense for contract acquisition cost as of September 30, 2015 are as follows (in thousands): Year Ending September 30: Amounts 2016 $ 2017 2018 2019 2020 Thereafter — Total $ |
Accrued Expenses and Other Cu33
Accrued Expenses and Other Current Liabilities (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
Accrued Expenses and Other Current Liabilities | |
Schedule of accrued expenses and other current liabilities | Accrued expenses and other current liabilities consist of the following (in thousands): As of September 30, 2015 2014 Vacation $ $ Bonus Warranty liability — Payroll Employee stock purchase plan liability Other Total accrued liabilities $ $ |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
Long-Term Debt. | |
Schedule of long-term debt | The Company’s outstanding long-term debt consists of the following (in thousands): As of September 30, 2015 2014 Term loan agreement expiring June 30, 2019 , less discount of $58 and $76 as of September 30, 2015 and 2014. See terms of the agreement below. $ $ Notes payable to lessor for tenant improvements. The note calls for monthly payments of principal and interest of $3 at an interest rate of 7% and is due April 2017 Notes payable to lessor for tenant improvements. The note calls for monthly payments of principal and interest of $6 at an interest rate of 7% and is due November 2024 Total Less current portion Long-term portion $ $ |
Schedule of minimum principal payments on the entity's outstanding debt | Minimum principal payments on the Company's outstanding long-term debt, as of September 30, 2015 were as follows (in thousands): Year Ending September 30: Amounts 2016 $ 2017 2018 2019 2020 Thereafter Total $ |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
Commitments and Contingencies. | |
Schedule of future minimum lease payments under capital leases, together with the present value of the net minimum lease payments | Future minimum lease payments under capital leases, together with the present value of the net minimum lease payments as of September 30, 2015, are as follows (in thousands): Year Ending September 30, Amounts 2016 $ 2017 2018 — Net minimum lease payments Less amount representing interest Present value of net minimum lease payments Less discount related to warrants Capital lease liability Less current portion Long-term portion $ |
Schedule of future minimum lease payments under operating leases that have initial or remaining lease terms in excess of one year | Future minimum lease payments under operating leases that had initial or remaining lease terms in excess of one year from September 30, 2015 were as follows (in thousands): Year Ending September 30, Amounts 2016 $ 2017 2018 2019 2020 Thereafter Total $ |
Collaboration and Partner Arr36
Collaboration and Partner Arrangements (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
Collaboration and Partner Arrangements. | |
Schedule of revenues from the entity's collaboration and partner agreements | The Company has recognized the following revenues from its collaboration and partner agreements during fiscal 2015, 2014, and 2013 (in thousands): Years ended September 30, 2015 2014 2013 Teva $ $ $ Par P&G Agile Aequus — Other Total revenues $ $ $ |
Convertible Preferred Stock, 37
Convertible Preferred Stock, Redeemable Common Stock and Stockholders' Equity (Deficit) (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
Convertible Preferred Stock, Common Stock and Stockholders' Equity (Deficit) | |
Schedule of reserved shares of common stock, on an as-if converted basis, for issuance | As of September 30, 2015 2014 Issuances under stock option plans Issuances upon exercise of common stock warrants Issuances under the 2014 Employee Stock Purchase Plan |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
Stock-based compensation | |
Schedule of employee stock-based compensation expense classified in the statements of operations and comprehensive income (loss) | Employee stock-based compensation expense for fiscal 2015, 2014 and 2013 is classified in the statements of operations and comprehensive loss as follows (in thousands): Year ended September 30, 2015 2014 2013 Cost of product revenues $ $ $ Cost of contract research and development revenues Research and development General and administrative Total stock-based compensation $ $ $ |
Corium Plans | |
Stock-based compensation | |
Summary of activity under the Plans | Weighted Weighted Average Shares Stock Average Remaining Aggregate Available Options Exercise Contractual Intrinsic Value for Grant Outstanding Price Life (Years) (In thousands) Balance - October 1, 2012 $ 5.20 Additional shares authorized — — Granted $ Exercised — $ Forfeited / Cancelled $ Balance - September 30, 2013 $ $ Additional shares authorized — — Granted $ Exercised — $ Forfeited / Cancelled $ Balance - September 30, 2014 $ $ Additional shares authorized — — Granted $ Exercised — $ Forfeited / Cancelled $ Balance - September 30, 2015 $ $ Options exercisable - September 30, 2015 $ $ Options vested and expected to vest - September 30, 2015 $ $ |
Schedule of valuation assumptions used | Year Ended Year Ended Year Ended September 30, 2015 September 30, 2014 September 30, 2013 Expected term (in years) - - - Risk-free interest rate % - % % - % % - % Expected volatility % - % % - % % - % Expected dividend rate % % % |
StrataGent Plan | |
Stock-based compensation | |
Summary of activity under the Plans | Weighted Average Remaining Aggregate Stock Options Weighted Average Contractual Life Intrinsic Outstanding Exercise Price (Years) Value (In thousands) Balance — October 1, 2012 $ Exercised $ Forfeited $ Balance - September 30, 2013 $ $ Balance - September 30, 2014 $ $ Exercised $ Balance - September 30, 2015 — $ — — $ — Options exercisable September 30, 2015 — $ — — $ — Options vested and expected to vest September 30, 2015 — $ — — $ — |
Schedule of valuation assumptions used | Year Ended September 30, 2015 Fair value of common stock $ – Grant price $ – Expected term (in years) – Expected volatility % – % Risk-free interest rate % – % Expected dividend rate % |
Product Recall Liability (Table
Product Recall Liability (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
Product Recall Liability | |
Summary of changes to the product recall liability | The following table summarizes the changes to the product recall liability (in thousands): Year Ended September 30, 2015 2014 2013 Beginning balance $ $ $ Payment of settlement liability Ending balance $ $ $ |
Product Liability (Tables)
Product Liability (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
Product Liability | |
Summary of the changes to the product liability reserve | The following table summarizes the changes to the product liability reserve (in thousands): Year Ended September 30, 2015 2014 2013 Beginning balance $ $ $ Settlement payments — — Expense (income) Ending balance $ $ $ |
Net Loss and Net Loss per Sha41
Net Loss and Net Loss per Share Attributable to Common Stockholders (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
Net Income (Loss) and Net Income (Loss) per Share Attributable to Common Stockholders | |
Schedule of computation of the Company's basic and diluted net income (loss) per share attributable to common stockholders | The following table sets forth the computation of the Company's basic and diluted net loss per share attributable to common stockholders during fiscal 2015, 2014 and 2013 (in thousands, except share and per share data): Year Ended September 30, 2015 2014 2013 Net loss attributable to common stockholders, basic and diluted $ $ $ Weighted average shares used in computing net loss per share attributable to common stockholders, basic and diluted Net loss per share attributable to common stockholders, basic and diluted $ $ $ |
Schedule of anti-dilutive securities excluded from calculation of diluted net income (loss) per share attributable to common stockholders | Year Ended September 30, 2015 2014 2013 Convertible preferred stock — — Stock options to purchase common stock Shares authorized under the 2014 ESPP — Common stock warrants Preferred stock warrants — — |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
Income Taxes | |
Schedule of reconciliation of the tax expense (benefit) computed at the statutory federal rate and the Company's tax expense (benefit) | The following table presents a reconciliation of the tax expense (benefit) computed at the statutory federal rate and the Company's tax expense (benefit) for the period presented (in thousands): Year Ended September 30, 2015 2014 2013 Income tax benefit — computed as 34% of pretax loss $ $ $ Effect of nondeductible expenses State and local income tax expenses Valuation allowance Effect of tax credits and other State deferred taxes Other — Total $ $ $ |
Schedule of tax effects of temporary differences and carryforwards that give rise to significant portions of deferred tax assets and liabilities | The tax effects of temporary differences and carryforwards that give rise to significant portions of deferred tax assets and liabilities as of September 30, 2015 and 2014 are as follows (in thousands): As of September 30, 2015 2014 Deferred tax assets: Net operating loss carryforward $ $ Depreciation Accrued expenses Research and development tax credit State deferred taxes Other Gross deferred tax assets Valuation allowance Net deferred tax assets Deferred tax liabilities: Other Gross deferred tax liabilities Net deferred tax liabilities $ — $ — |
Schedule of unrecognized tax benefits roll forward | As of September 30, 2015 Balance - September 30, 2014 $ — Increases related to current year tax provisions — Increases related to prior year tax provisions Balance - September 30, 2015 $ |
Selected Quarterly Financial 43
Selected Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended |
Sep. 30, 2015 | |
Selected Quarterly Financial Data (Unaudited) | |
Schedule of selected quarterly results from operations | Selected quarterly results from operations for the years ended September 30, 2015 and 2014 are as follows (in thousands, except per share amounts): Fiscal 2015 Quarter Ended December 31, 2014 March 31, 2015 June 30, 2015 September 30, 2015 Total revenue $ $ $ $ Operating expenses $ $ $ $ Net loss $ $ $ $ Basic and diluted net loss per common share $ $ $ $ Fiscal 2014 Quarter Ended December 31, 2013 March 31, 2014 June 30, 2014 September 30, 2014 Total revenue $ $ $ $ Operating expenses $ $ $ $ Net income (loss) $ $ $ $ Basic net income (loss) per common share $ $ $ $ Diluted net income (loss) per common share $ $ $ $ |
Organization, Description of 44
Organization, Description of Business, and Summary of Significant Accounting Policies (Details) - USD ($) $ / shares in Units, $ in Millions | Apr. 08, 2014 | Aug. 31, 2015 | Sep. 30, 2015 | Sep. 30, 2014 | Mar. 20, 2014 |
Organization, Description of Business, and Summary of Significant Accounting Policies | |||||
Shares of common stock sold in public offering | 6,874,997 | 4,000,000 | |||
Price at which shares of common stock were sold in IPO (in dollars per share) | $ 8 | ||||
Net cash proceeds from the IPO, including proceeds from the partial exercise of the underwriters' option, after underwriting discounts, commissions and issuance costs | $ 48.5 | ||||
Underwriting discounts, commissions and issuance costs in connection with initial public offering as of April 2014 | $ 6.5 | $ 3.4 | |||
Shares of common stock issued upon conversion of all outstanding shares of convertible preferred stock | 3,567,807 | ||||
Carrying value of outstanding shares of convertible preferred stock reclassified to common stock and additional paid-in capital | $ 57.3 | ||||
Shares of common stock issued upon conversion of convertible preferred stock and common stock | 971,440 | ||||
Number of shares repurchased | 1,077,809 | ||||
Aggregate repurchase price | $ 5.2 | ||||
Authorized shares (in shares) | 155,000,000 | ||||
Authorized common stock (in shares) | 150,000,000 | 150,000,000 | 150,000,000 | ||
Authorized preferred stock (in shares) | 5,000,000 | ||||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | $ 0.001 | $ 0.001 | |
Preferred stock, par value (in dollars per share) | $ 0.001 |
Organization, Description of 45
Organization, Description of Business, and Summary of Significant Accounting Policies (Details 2) $ / shares in Units, $ in Millions | Sep. 30, 2015USD ($)$ / sharesshares | Sep. 30, 2014USD ($)$ / sharesshares | Mar. 20, 2014$ / sharesshares | Sep. 30, 2015USD ($)item$ / sharesshares | Sep. 30, 2014USD ($)item$ / sharesshares | Sep. 30, 2013USD ($)item | Apr. 08, 2014$ / shares |
Reverse Stock Split | |||||||
Stock split ratio | 0.099 | ||||||
Common stock outstanding before reverse stock split (in shares) | shares | 19,032,056 | ||||||
Common stock outstanding | shares | 22,160,991 | 18,003,883 | 1,884,362 | 22,160,991 | 18,003,883 | ||
Common stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | $ 0.001 | $ 0.001 | $ 0.001 | $ 0.001 | |
Revenue Recognition | |||||||
Royalties and profit sharing | $ | $ 2.3 | $ 6.7 | $ 7.8 | ||||
Accounts Receivable and Allowance for Doubtful Accounts | |||||||
Allowance for doubtful accounts | $ | $ 0 | $ 0 | $ 0 | $ 0 | |||
Four partners | |||||||
Concentration of credit risk | |||||||
Number of partners | 4 | 4 | |||||
Revenues. | Customer concentration | Four partners | |||||||
Concentration of credit risk | |||||||
Concentration risk percentage | 95.00% | 99.00% | |||||
Revenues. | Customer concentration | Three partners | |||||||
Concentration of credit risk | |||||||
Number of partners | 3 | ||||||
Concentration risk percentage | 82.00% | ||||||
Accounts receivable | Credit concentration | Four partners | |||||||
Concentration of credit risk | |||||||
Concentration risk percentage | 95.00% | ||||||
Accounts receivable | Credit concentration | Three partners | |||||||
Concentration of credit risk | |||||||
Number of partners | 3 | ||||||
Concentration risk percentage | 84.00% |
Organization, Description of 46
Organization, Description of Business, and Summary of Significant Accounting Policies (Details 3) - USD ($) $ in Millions | 12 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2013 | |
Impairment of Long-Lived Assets | |||
Impairment | $ 0 | $ 0 | $ 0 |
Equipment | Minimum | |||
Impairment of Long-Lived Assets | |||
Useful life | 3 years | ||
Equipment | Maximum | |||
Impairment of Long-Lived Assets | |||
Useful life | 8 years | ||
Leasehold improvements | Minimum | |||
Impairment of Long-Lived Assets | |||
Useful life | 3 years | ||
Leasehold improvements | Maximum | |||
Impairment of Long-Lived Assets | |||
Useful life | 15 years |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - Recurring basis - Money market funds - USD ($) $ in Thousands | Sep. 30, 2015 | Sep. 30, 2014 |
Financial Assets | ||
Total financial assets | $ 71,970 | $ 36,019 |
Level I | ||
Financial Assets | ||
Total financial assets | $ 71,970 | $ 36,019 |
Fair Value Measurements (Deta48
Fair Value Measurements (Details 2) $ in Thousands | 12 Months Ended |
Sep. 30, 2014USD ($) | |
Changes in the fair value of the Level III financial liabilities | |
Beginning balance | $ 7,927 |
Ending balance | 0 |
Preferred stock warrants | |
Changes in the fair value of the Level III financial liabilities | |
Change in fair value | 274 |
Extinguishment of preferred stock warrant liability | (834) |
Subordinated note embedded derivative liability | |
Changes in the fair value of the Level III financial liabilities | |
Change in fair value | $ (7,367) |
Fair Value Measurements (Deta49
Fair Value Measurements (Details 3) - Level III - USD ($) $ in Thousands | Sep. 30, 2015 | Sep. 30, 2014 |
Carrying Value | ||
Fair value measurements | ||
Long-term debt | $ 49,864 | $ 38,262 |
Fair Value | ||
Fair value measurements | ||
Long-term debt | 49,967 | 40,357 |
Difference | ||
Fair value measurements | ||
Long-term debt | $ 103 | $ 2,095 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Sep. 30, 2014 |
Inventories | ||
Raw materials | $ 1,573 | $ 1,268 |
Work in process | 852 | 898 |
Finished goods | 612 | 632 |
Total inventories, cost | 3,037 | 2,798 |
Less inventory reserves | (135) | (206) |
Total inventories, net | $ 2,902 | $ 2,592 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2013 | |
Property and equipment | |||
Total property and equipment, gross | $ 26,852 | $ 26,855 | |
Accumulated depreciation and amortization | (15,259) | (14,197) | |
Total property and equipment, net | 11,593 | 12,658 | |
Depreciation and amortization of property and equipment | 2,015 | 2,230 | $ 1,892 |
Machinery and equipment | |||
Property and equipment | |||
Total property and equipment, gross | 11,667 | 12,242 | |
Manufacturing equipment acquired under capital leases | |||
Property and equipment | |||
Total property and equipment, gross | 2,341 | 2,341 | |
Transportation equipment | |||
Property and equipment | |||
Total property and equipment, gross | 25 | 25 | |
Furniture and fixtures | |||
Property and equipment | |||
Total property and equipment, gross | 1,114 | 995 | |
Computer equipment and software | |||
Property and equipment | |||
Total property and equipment, gross | 559 | 535 | |
Leasehold improvements | |||
Property and equipment | |||
Total property and equipment, gross | 3,748 | 3,658 | |
Land | |||
Property and equipment | |||
Total property and equipment, gross | 210 | 210 | |
Construction in progress | |||
Property and equipment | |||
Total property and equipment, gross | $ 7,188 | $ 6,849 |
Intangible Assets (Details)
Intangible Assets (Details) - USD ($) | 12 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2013 | |
Intangible assets | |||
Total carrying value | $ 12,711,000 | $ 11,941,000 | |
Total accumulated amortization | (5,874,000) | (5,258,000) | |
Total | 6,837,000 | 6,683,000 | |
Amortization of intangible assets | 622,000 | 547,000 | $ 541,000 |
Patents and trademarks | |||
Intangible assets | |||
Total carrying value | 11,045,000 | 10,269,000 | |
Total accumulated amortization | (4,348,000) | (3,756,000) | |
Amounts | |||
2,015 | 604,000 | ||
2,016 | 604,000 | ||
2,017 | 604,000 | ||
2,018 | 602,000 | ||
2,019 | 528,000 | ||
Thereafter | 1,117,000 | ||
Total | 4,059,000 | ||
Contract acquisition cost | |||
Intangible assets | |||
Total carrying value | 1,666,000 | 1,672,000 | |
Total accumulated amortization | (1,526,000) | (1,502,000) | |
Amortization of intangible assets | 29,000 | 29,000 | 65,000 |
Amounts | |||
2,015 | 29,000 | ||
2,016 | 29,000 | ||
2,017 | 29,000 | ||
2,018 | 29,000 | ||
2,019 | 24,000 | ||
Thereafter | 0 | ||
Total | $ 140,000 | ||
Contract acquisition cost | Minimum | |||
Intangible assets | |||
Estimated useful lives | 4 years | ||
Contract acquisition cost | Maximum | |||
Intangible assets | |||
Estimated useful lives | 15 years | ||
Patents | |||
Intangible assets | |||
Amortization of intangible assets | $ 600,000 | 500,000 | $ 500,000 |
Patents | Minimum | |||
Intangible assets | |||
Estimated useful lives | 7 years | ||
Patents | Maximum | |||
Intangible assets | |||
Estimated useful lives | 20 years | ||
Patents in process | |||
Intangible assets | |||
Total carrying value | $ 2,600,000 | $ 2,100,000 |
Notes Receivable - Related Pa53
Notes Receivable - Related Parties (Details) - Executive officers - Unsecured note - USD ($) | 12 Months Ended | |
Sep. 30, 2014 | Sep. 30, 2013 | |
Notes receivable - related Parties | ||
Effective interest rate (as a percent) | 2.25% | |
Maximum | ||
Notes receivable - related Parties | ||
Related party interest income | $ 1,000 | $ 1,000 |
Prime rate | ||
Notes receivable - related Parties | ||
Basis spread on variable rate (as a percent) | (1.00%) | |
Variable rate basis | prime rate |
Accrued Expenses and Other Cu54
Accrued Expenses and Other Current Liabilities (Detail) - USD ($) $ in Thousands | Sep. 30, 2015 | Sep. 30, 2014 |
Accrued Expenses and Other Current Liabilities | ||
Vacation | $ 1,978 | $ 1,747 |
Bonus | 1,450 | 1,235 |
Warranty liability | 0 | 284 |
Payroll | 316 | 249 |
Employee stock purchase plan liability | 235 | 305 |
Other | 112 | 188 |
Total accrued liabilities | $ 4,091 | $ 4,008 |
Debt (Details)
Debt (Details) | Dec. 04, 2014USD ($) | Nov. 14, 2014USD ($) | Dec. 31, 2012USD ($) | Aug. 31, 2012USD ($) | Sep. 30, 2015USD ($) | Sep. 30, 2015USD ($)installment | Sep. 30, 2015USD ($) | Sep. 30, 2015USD ($) | Sep. 30, 2015USD ($) | Sep. 30, 2014USD ($) | Jul. 13, 2012USD ($) |
Long-term Debt | |||||||||||
Total | $ 49,864,000 | $ 49,864,000 | $ 49,864,000 | $ 49,864,000 | $ 49,864,000 | $ 38,262,000 | |||||
Less current portion | 57,000 | 57,000 | 57,000 | 57,000 | 57,000 | 107,000 | |||||
Long-term debt, net of current portion | 49,807,000 | 49,807,000 | 49,807,000 | 49,807,000 | 49,807,000 | 38,155,000 | |||||
Term loan agreement expiring on June 30, 2019 | |||||||||||
Long-term Debt | |||||||||||
Total | 49,295,000 | 49,295,000 | 49,295,000 | 49,295,000 | 49,295,000 | 37,625,000 | |||||
Unamortized discount | $ 58,000 | $ 58,000 | $ 58,000 | $ 58,000 | $ 58,000 | 76,000 | |||||
Interest rate (as a percent) | 15.00% | 15.00% | 15.00% | 15.00% | 15.00% | ||||||
Face amount | $ 45,000,000 | $ 35,000,000 | |||||||||
Increase in principal amount | $ 10,000,000 | ||||||||||
Amount drawn | $ 6,000,000 | $ 29,000,000 | |||||||||
Proceeds from debt issued | $ 10,000,000 | ||||||||||
Number of quarterly installments for repayment of outstanding principal | installment | 4 | ||||||||||
Percentage of cash payment the entity can defer by converting interest due into additional notes | 3.50% | ||||||||||
Portion of interest due converted into additional notes | $ 4,400,000 | $ 2,700,000 | |||||||||
Principal amount outstanding | $ 49,400,000 | $ 49,400,000 | $ 49,400,000 | 49,400,000 | 49,400,000 | ||||||
Notes payable due April 2017 | |||||||||||
Long-term Debt | |||||||||||
Total | $ 66,000 | $ 66,000 | 66,000 | $ 66,000 | $ 66,000 | 96,000 | |||||
Monthly payments of principal and interest | $ 3,000 | ||||||||||
Interest rate (as a percent) | 7.00% | 7.00% | 7.00% | 7.00% | 7.00% | ||||||
Notes payable due in November 2024 | |||||||||||
Long-term Debt | |||||||||||
Total | $ 503,000 | $ 503,000 | $ 503,000 | $ 503,000 | $ 503,000 | $ 541,000 | |||||
Monthly payments of principal and interest | $ 6,000 | ||||||||||
Interest rate (as a percent) | 7.00% | 7.00% | 7.00% | 7.00% | 7.00% |
Debt (Details 2)
Debt (Details 2) | Dec. 04, 2014USD ($) | Apr. 08, 2014USD ($)shares | Dec. 31, 2013USD ($)itemmultipleshares | Jul. 31, 2012USD ($) | Sep. 30, 2013USD ($)item | Sep. 30, 2009USD ($) | Sep. 30, 2007itemshares | Sep. 30, 2009USD ($) | Sep. 30, 2015USD ($) | Nov. 14, 2014USD ($) | Sep. 30, 2014USD ($) | Jul. 13, 2012USD ($) |
Debt | ||||||||||||
Aggregate repurchase price | $ 5,200,000 | |||||||||||
Shares repurchased from the founders | shares | 1,077,809 | |||||||||||
Minimum principal payments on the entity's outstanding debt | ||||||||||||
2,015 | $ 57,000 | |||||||||||
2,016 | 62,000 | |||||||||||
2,017 | 12,369,000 | |||||||||||
2,018 | 37,053,000 | |||||||||||
2,019 | 53,000 | |||||||||||
Thereafter | 270,000 | |||||||||||
Total | $ 49,864,000 | $ 38,262,000 | ||||||||||
Redeemable Common Stock | ||||||||||||
Debt | ||||||||||||
Number of shares repurchased in connection with financing | shares | 1,077,809 | 215,872 | ||||||||||
Aggregate repurchase price | $ 5,200,000 | |||||||||||
Number of founders | item | 2 | 1 | 2 | |||||||||
Convertible notes and warrant purchase agreements | ||||||||||||
Debt | ||||||||||||
Proceeds from issuance of debt and warrants | $ 20,000,000 | |||||||||||
Convertible notes | ||||||||||||
Debt | ||||||||||||
Repayments on convertible notes | $ 10,000,000 | |||||||||||
Principal amount and accrued interest and a derivative liability | $ 19,400,000 | |||||||||||
Number of shares converted into common stock | shares | 2,036,555 | |||||||||||
Convertible notes | Common Stock | ||||||||||||
Debt | ||||||||||||
Conversion of debt securities (in shares) | shares | 2,036,555 | |||||||||||
Convertible notes | New series preferred stock | ||||||||||||
Debt | ||||||||||||
Conversion of debt securities (in shares) | shares | 2,036,555 | |||||||||||
Term loan agreement expiring on June 30, 2019 | ||||||||||||
Debt | ||||||||||||
Interest rate (as a percent) | 15.00% | |||||||||||
Face amount | $ 45,000,000 | $ 35,000,000 | ||||||||||
Proceeds from debt issued | $ 10,000,000 | |||||||||||
Minimum principal payments on the entity's outstanding debt | ||||||||||||
Total | $ 49,295,000 | $ 37,625,000 | ||||||||||
Subordinated note | ||||||||||||
Debt | ||||||||||||
Principal amount and accrued interest and a derivative liability | $ 19,200,000 | |||||||||||
Number of shares converted into common stock | shares | 3,387,146 | |||||||||||
Proceeds from debt issued | $ 13,000,000 | |||||||||||
Fair value of embedded derivative liability | $ 7,400,000 | |||||||||||
Subordinated note | Common Stock | ||||||||||||
Debt | ||||||||||||
Conversion of debt securities (in shares) | shares | 3,387,146 | |||||||||||
Subordinated note | New series preferred stock | ||||||||||||
Debt | ||||||||||||
Conversion of debt securities (in shares) | shares | 3,387,146 | |||||||||||
Multiple of preferred stock liquidation preference value | multiple | 1 |
Commitments and Contingencies57
Commitments and Contingencies (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2013 | |
Future minimum lease payments under capital leases, together with the present value of the net minimum lease payments | |||
2,015 | $ 877 | ||
2,016 | 73 | ||
Net minimum lease payments | 950 | ||
Less amount representing interest | (53) | ||
Present value of net minimum lease payments | 897 | ||
Less discount related to warrants | (5) | ||
Capital lease liability | 892 | ||
Less current portion | (820) | $ (760) | |
Long-term portion | 72 | 891 | |
Depreciation expense on equipment under capital leases | 800 | 1,000 | $ 600 |
Operating Leases | |||
Rental expense on operating leases | 1,800 | $ 1,700 | $ 1,600 |
Schedule of future minimum lease payments under operating leases that have initial or remaining lease terms in excess of one year | |||
2,015 | 1,373 | ||
2,016 | 1,289 | ||
2,017 | 1,179 | ||
2,018 | 1,208 | ||
2,019 | 1,238 | ||
Thereafter | 3,170 | ||
Total | $ 9,457 |
Collaboration and Partner Arr58
Collaboration and Partner Arrangements (Details) $ in Thousands | Apr. 08, 2014shares | Aug. 31, 2015shares | Sep. 30, 2014USD ($) | Oct. 31, 2012 | Sep. 30, 2015USD ($) | Jun. 30, 2015USD ($) | Mar. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Sep. 30, 2014USD ($) | Jun. 30, 2014USD ($) | Mar. 31, 2014USD ($) | Dec. 31, 2013USD ($) | Sep. 30, 2015USD ($)item | Sep. 30, 2014USD ($) | Sep. 30, 2013USD ($)item | Sep. 30, 2008USD ($)item | Sep. 30, 2007item | Sep. 30, 2006item | Sep. 30, 2005USD ($)shares | Sep. 30, 2004item | Sep. 30, 2013USD ($) | Sep. 30, 2007item |
Collaboration and partner arrangements | ||||||||||||||||||||||
Total revenues | $ 9,266 | $ 10,598 | $ 11,291 | $ 9,766 | $ 11,072 | $ 10,183 | $ 10,717 | $ 10,468 | $ 40,921 | $ 42,440 | $ 50,270 | |||||||||||
Number of shares issued | shares | 6,874,997 | 4,000,000 | ||||||||||||||||||||
Collaboration and partner arrangements | ||||||||||||||||||||||
Collaboration and partner arrangements | ||||||||||||||||||||||
Total revenues | 40,921 | 42,440 | 50,270 | |||||||||||||||||||
Collaboration and partner arrangements | P&G | ||||||||||||||||||||||
Collaboration and partner arrangements | ||||||||||||||||||||||
Total revenues | 11,647 | 11,719 | 11,781 | |||||||||||||||||||
License fee revenue | $ 3,000 | |||||||||||||||||||||
Milestone payments received for the first series of products developed | $ 2,000 | |||||||||||||||||||||
Aggregate amount of milestone payments if all new products are completed successfully | 500 | |||||||||||||||||||||
Shares of common stock issued for payments of patent acquired | shares | 125,428 | |||||||||||||||||||||
Collaboration and partner arrangements | Teva | ||||||||||||||||||||||
Collaboration and partner arrangements | ||||||||||||||||||||||
Total revenues | $ 12,380 | 13,550 | 16,683 | |||||||||||||||||||
Number of development programs discontinued by collaboration partner | item | 4 | |||||||||||||||||||||
Number of development programs remaining with the collaboration partner | item | 3 | |||||||||||||||||||||
Number of development programs resulting in approved products which are currently being marketed by collaboration partner | item | 1 | |||||||||||||||||||||
Number of development programs resulting in approved products which collaboration partner is assessing launch strategy and timing | item | 1 | |||||||||||||||||||||
Number of other products whose regulatory approval are pending | item | 1 | |||||||||||||||||||||
Term of automatic renewals of each commercial agreement | 1 year | |||||||||||||||||||||
Collaboration and partner arrangements | Par | ||||||||||||||||||||||
Collaboration and partner arrangements | ||||||||||||||||||||||
Total revenues | $ 9,601 | 12,971 | 16,551 | |||||||||||||||||||
Term of commercial agreement | 20 years | |||||||||||||||||||||
Non-cash product revenues associated with the termination of a liability under an agreement | $ 1,800 | |||||||||||||||||||||
Collaboration and partner arrangements | Agile | ||||||||||||||||||||||
Collaboration and partner arrangements | ||||||||||||||||||||||
Total revenues | 3,238 | 1,976 | 4,904 | |||||||||||||||||||
Amount received from counterparty towards leasehold improvements incurred by the entity | $ 3,500 | |||||||||||||||||||||
Amount received from counterparty for idle facility charges | $ 1,000 | 1,000 | 600 | |||||||||||||||||||
Minimum period commercially produced an agreed-upon quantity of patches | 5 years | |||||||||||||||||||||
Collaboration and partner arrangements | Aequus | ||||||||||||||||||||||
Collaboration and partner arrangements | ||||||||||||||||||||||
Total revenues | $ 687 | 86 | ||||||||||||||||||||
Milestone payment received | 200 | 100 | ||||||||||||||||||||
Collaboration and partner arrangements | Other | ||||||||||||||||||||||
Collaboration and partner arrangements | ||||||||||||||||||||||
Total revenues | 3,368 | $ 2,138 | 351 | |||||||||||||||||||
Amount will be reimbursed for certain development milestones | 3,400 | |||||||||||||||||||||
Milestone payment received | $ 1,100 | $ 500 | ||||||||||||||||||||
Maximum profit sharing percentage | 50.00% | |||||||||||||||||||||
Collaboration and partner arrangements | Other | Generic transdermal products | ||||||||||||||||||||||
Collaboration and partner arrangements | ||||||||||||||||||||||
Number of products for which the entity entered into an arrangement | item | 2 | |||||||||||||||||||||
Collaboration and partner arrangements | Barr | ||||||||||||||||||||||
Collaboration and partner arrangements | ||||||||||||||||||||||
Number of products for which the entity entered into an arrangement | item | 3 | |||||||||||||||||||||
Number of separate agreements to develop and commercialize additional products | item | 2 | 1 | 3 | |||||||||||||||||||
Collaboration and partner arrangements | Barr | Generic products | ||||||||||||||||||||||
Collaboration and partner arrangements | ||||||||||||||||||||||
Number of products for which the entity entered into an arrangement | item | 4 |
Warrants (Details)
Warrants (Details) - USD ($) | Sep. 30, 2015 | Sep. 30, 2014 | Apr. 08, 2014 | Sep. 30, 2015 | Sep. 30, 2013 | Sep. 30, 2015 | Aug. 31, 2015 |
Assumptions to estimate the fair value of warrant | |||||||
Common stock value (in dollars per share) | $ 13 | ||||||
Stock exercised into shares of common stock using the net exercise provisions in the warrants (in shares) | 12,591 | ||||||
Shares of common stock issued upon conversion of Series C convertible preferred stock | 971,440 | ||||||
Preferred stock warrants | |||||||
Warrants | |||||||
Warrants issued (in shares) | 1,739,992 | ||||||
Weighted-average exercise price (in dollars per share) | $ 1.88 | $ 0.90 | |||||
Warrant term | 5 years | ||||||
Number of warrants that expire upon the earlier of five years and the closing of an IPO (in shares) | 163,522 | ||||||
Assumptions to estimate the fair value of warrant | |||||||
Stock exercised into shares of common stock using the net exercise provisions in the warrants (in shares) | 163,522 | ||||||
Shares of common stock issued upon conversion of Series C convertible preferred stock | 1,191 | ||||||
Remaining stock converted into warrants to purchase common stock (in shares) | 1,216,719 | ||||||
Amount of preferred stock warrant liability reclassified to stockholders' equity upon exercise of preferred stock warrants | $ 800,000 | ||||||
Common stock warrants | |||||||
Warrants | |||||||
Warrants issued (in shares) | 8,118 | ||||||
Warrants outstanding (in shares) | 51,386 | 128,582 | 51,386 | 51,386 | |||
Weighted-average exercise price (in dollars per share) | $ 9.26 | $ 8.69 | $ 9.26 | $ 9.26 | |||
Assumptions to estimate the fair value of warrant | |||||||
Remaining contractual term | 5 years | ||||||
Risk-free interest rate (as a percent) | 1.41% | ||||||
Expected volatility (as a percent) | 76.00% | ||||||
Expected dividend rate (as a percent) | 0.00% | ||||||
Common stock value (in dollars per share) | $ 3.03 | ||||||
Fair value of warrants | $ 15,000 | ||||||
Stock exercised into shares of common stock using the net exercise provisions in the warrants (in shares) | 1,286,495 | ||||||
Shares of common stock issued upon conversion of Series C convertible preferred stock | 970,249 | ||||||
Remaining stock converted into warrants to purchase common stock (in shares) | 51,386 | 120,464 | 120,464 | ||||
Common stock warrants | Maximum | |||||||
Warrants | |||||||
Warrant term | 5 years |
Convertible Preferred Stock, 60
Convertible Preferred Stock, Redeemable Common Stock and Stockholders' Equity (Deficit) (Details) - Convertible Preferred Stock - USD ($) | Sep. 30, 2015 | Sep. 30, 2014 |
Convertible preferred stock | ||
Par value (in dollars per shares) | $ 0.001 | $ 0.001 |
Shares Authorized | 5,000,000 | 5,000,000 |
Shares Outstanding | 0 | 0 |
Convertible Preferred Stock, 61
Convertible Preferred Stock, Redeemable Common Stock and Stockholders' Equity (Deficit) (Details 2) - USD ($) $ / shares in Units, $ in Thousands | Apr. 08, 2014 | Aug. 31, 2015 | Sep. 30, 2015 | Sep. 30, 2014 | May. 31, 2015 | Mar. 20, 2014 | Sep. 30, 2013 |
Common stock | |||||||
Common shares authorized | 150,000,000 | 150,000,000 | 150,000,000 | ||||
Value of shares authorized | $ 125,000 | ||||||
Number of shares issued | 6,874,997 | 4,000,000 | |||||
Common stock value (in dollars per share) | $ 13 | ||||||
Proceeds from issuance of common stock, net of issuance costs | $ 48,600 | $ 48,643 | $ 48,459 | ||||
Underwriting discounts, commissions and issuance costs in connection with public offering in August 2015 | $ 6,500 | $ 3,400 | |||||
Common shares par value (in dollars per share) | $ 0.001 | $ 0.001 | $ 0.001 | $ 0.001 | |||
Common Stock reserved | |||||||
Issuances under stock option plans (in shares) | 3,745,373 | 3,039,473 | |||||
Issuances upon exercise of warrants (in shares) | 51,386 | 128,582 | |||||
Issuances under employee stock purchase plan (in shares) | 372,529 | 310,000 | |||||
Total shares of common stock reserved | 4,169,288 | 3,478,055 | |||||
Common stock warrants | |||||||
Common stock | |||||||
Common stock value (in dollars per share) | $ 3.03 |
Convertible Preferred Stock, 62
Convertible Preferred Stock, Redeemable Common Stock and Stockholders' Equity (Deficit) (Details 3) $ / shares in Units, $ in Millions | Apr. 08, 2014USD ($)shares | Dec. 31, 2013USD ($)itemshares | Sep. 30, 2013itemshares | Sep. 30, 2007item$ / sharesshares |
Repurchases of Common Stock from Founders | ||||
Number of shares repurchased | 1,077,809 | |||
Aggregate repurchase price | $ | $ 5.2 | |||
Redeemable Common Stock | ||||
Repurchases of Common Stock from Founders | ||||
Number of founders | item | 2 | 1 | 2 | |
Number of shares repurchased in connection with financing | 1,077,809 | 215,872 | ||
Purchase price under the stock repurchase program (in dollars per share) | $ / shares | $ 9.26 | |||
Number of additional shares authorized to repurchase | 215,872 | |||
Aggregate repurchase price | $ | $ 5.2 | |||
Remaining number of shares to be repurchased from founder one contingent on approval by the board of directors | 132,073 | |||
Remaining number of shares to be repurchased from founder two contingent on approval by the board of directors | 215,872 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details) $ / shares in Units, $ in Thousands | May. 20, 2015$ / shares | Jan. 16, 2015shares | Nov. 20, 2014$ / shares | Nov. 19, 2014$ / shares | Mar. 20, 2014shares | Sep. 30, 2015USD ($)plan$ / sharesshares | Sep. 30, 2014USD ($)plan$ / sharesshares | Sep. 30, 2013USD ($)$ / sharesshares | Sep. 30, 2012$ / sharesshares | Sep. 30, 2015USD ($)plan$ / sharesshares |
Stock-based compensation | ||||||||||
Number of plans | plan | 4 | 4 | 4 | |||||||
Stock-based compensation expense | $ | $ 2,714 | $ 1,629 | $ 330 | |||||||
Weighted Average Exercise Price | ||||||||||
Granted (in dollars per share) | $ / shares | $ 10.46 | $ 4.67 | $ 6.80 | |||||||
Weighted Average Remaining Contractual Life | ||||||||||
Balance at the end of the period | 6 years 11 months 9 days | |||||||||
Options exercisable at the end of the period | 5 years 9 months 7 days | |||||||||
Options vested and expected to vest at the end of the period | 6 years 10 months 10 days | |||||||||
Aggregate Intrinsic Value | ||||||||||
Balance at the end of the period | $ | $ 15,482 | $ 15,482 | ||||||||
Options exercisable at the end of the period | $ | 10,987 | 10,987 | ||||||||
Options vested and expected to vest at the end of the period | $ | $ 15,182 | $ 15,182 | ||||||||
Stock options | Performance-based vesting | ||||||||||
Stock-based compensation | ||||||||||
Options granted (in shares) | 146,024 | |||||||||
Awards whose performance-based criteria have been met (in shares) | 137,510 | |||||||||
Stock-based compensation expense | $ | $ 300 | |||||||||
Shares Available for Grant | ||||||||||
Granted (in shares) | (146,024) | |||||||||
Stock Options Outstanding | ||||||||||
Granted (in shares) | 146,024 | |||||||||
Balance at the end of the period (in shares) | 8,514 | 8,514 | ||||||||
2014 Plan | ||||||||||
Stock-based compensation | ||||||||||
Term of the plan | 10 years | |||||||||
Number of shares of common stock initially reserved under plan for issuance to employees | 1,000,000 | |||||||||
Maximum annual increase in number of shares issuable by the plan, as a percentage of shares outstanding as of the preceding December 31 | 4.00% | |||||||||
Additional shares authorized | 722,834 | |||||||||
Shares Available for Grant | ||||||||||
Additional shares authorized | 722,834 | |||||||||
Corium Plans | Maximum | ||||||||||
Stock-based compensation | ||||||||||
Term of the plan | 10 years | |||||||||
Vesting period | 4 years | |||||||||
Corium Plans | Stock options | ||||||||||
Stock-based compensation | ||||||||||
Additional shares authorized | 722,834 | 1,272,277 | 792,079 | |||||||
Options granted (in shares) | 863,150 | 573,589 | 993,327 | |||||||
Shares Available for Grant | ||||||||||
Balance at the beginning of the period (in shares) | 949,885 | 248,410 | 231,297 | 231,297 | ||||||
Additional shares authorized | 722,834 | 1,272,277 | 792,079 | |||||||
Granted (in shares) | (863,150) | (573,589) | (993,327) | |||||||
Forfeited / Cancelled (in shares) | 20,827 | 2,787 | 218,361 | |||||||
Balance at the end of the period (in shares) | 830,396 | 949,885 | 248,410 | 231,297 | 830,396 | |||||
Stock Options Outstanding | ||||||||||
Balance at the beginning of the period (in shares) | 2,085,028 | 1,528,876 | 758,414 | 758,414 | ||||||
Granted (in shares) | 863,150 | 573,589 | 993,327 | |||||||
Exercised (in shares) | (12,374) | (14,650) | (4,504) | |||||||
Forfeited / Cancelled (in shares) | (20,827) | (2,787) | (218,361) | |||||||
Balance at the end of the period (in shares) | 2,914,977 | 2,085,028 | 1,528,876 | 758,414 | 2,914,977 | |||||
Options exercisable at the end of the period (in shares) | 1,716,914 | 1,716,914 | ||||||||
Options vested and expected to vest at the end of the period (in shares) | 2,808,568 | 2,808,568 | ||||||||
Weighted Average Exercise Price | ||||||||||
Balance at the beginning of the period (in dollars per share) | $ / shares | $ 2.92 | $ 2.22 | $ 3.13 | $ 3.13 | ||||||
Granted (in dollars per share) | $ / shares | 6.77 | 4.86 | 2.22 | |||||||
Exercised (in dollars per share) | $ / shares | 3.26 | 2.32 | 2.32 | |||||||
Forfeited / Cancelled (in dollars per share) | $ / shares | 5.77 | 3.30 | 5.93 | |||||||
Balance at the end of the period (in dollars per share) | $ / shares | 4.04 | $ 2.92 | $ 2.22 | $ 3.13 | 4.04 | |||||
Options exercisable at the end of the period (in dollars per share) | $ / shares | 2.95 | 2.95 | ||||||||
Options vested and expected to vest at the end of the period (in dollars per share) | $ / shares | 3.94 | $ 3.94 | ||||||||
Weighted Average Remaining Contractual Life | ||||||||||
Balance at the end of the period | 7 years 7 days | 7 years 2 months 19 days | 5 years 2 months 12 days | |||||||
Aggregate Intrinsic Value | ||||||||||
Balance at the end of the period | $ | $ 6,710 | $ 1,287 | ||||||||
Additional disclosures | ||||||||||
Exercise price, minimum(in dollars per share) | $ / shares | 2.120 | |||||||||
Exercise price, maximum(in dollars per share) | $ / shares | 14.120 | |||||||||
Weighted average grant date fair value of options granted (in dollars per share) | $ / shares | $ 4.37 | $ 8.03 | $ 1.31 | |||||||
Assumptions used in estimating weighted average fair value of the options granted | ||||||||||
Risk-free interest rate, minimum | 1.42% | 1.61% | 0.70% | |||||||
Risk-free interest rate, maximum | 1.93% | 2.25% | 1.38% | |||||||
Expected volatility, minimum | 70.00% | 63.00% | 71.00% | |||||||
Expected volatility, maximum | 77.00% | 74.00% | 75.00% | |||||||
Expected dividend rate (as a percent) | 0.00% | 0.00% | 0.00% | |||||||
Corium Plans | Stock options | Minimum | ||||||||||
Assumptions used in estimating weighted average fair value of the options granted | ||||||||||
Expected term (in years) | 5 years 3 months 7 days | 5 years 3 months 7 days | 2 years 6 months | |||||||
Corium Plans | Stock options | Maximum | ||||||||||
Assumptions used in estimating weighted average fair value of the options granted | ||||||||||
Expected term (in years) | 6 years 7 months 17 days | 6 years 29 days | 6 years 29 days | |||||||
StrataGent Plan | Stock options | ||||||||||
Stock-based compensation | ||||||||||
Options granted (in shares) | 0 | |||||||||
Shares Available for Grant | ||||||||||
Granted (in shares) | 0 | |||||||||
Forfeited / Cancelled (in shares) | 9,233 | |||||||||
Stock Options Outstanding | ||||||||||
Balance at the beginning of the period (in shares) | 4,560 | 4,560 | 35,477 | 35,477 | ||||||
Granted (in shares) | 0 | |||||||||
Exercised (in shares) | (4,560) | (21,684) | ||||||||
Forfeited / Cancelled (in shares) | (9,233) | |||||||||
Balance at the end of the period (in shares) | 0 | 4,560 | 4,560 | 35,477 | 0 | |||||
Options exercisable at the end of the period (in shares) | 0 | 0 | ||||||||
Options vested and expected to vest at the end of the period (in shares) | 0 | 0 | ||||||||
Weighted Average Exercise Price | ||||||||||
Balance at the beginning of the period (in dollars per share) | $ / shares | $ 0.71 | $ 0.71 | $ 0.20 | $ 0.20 | ||||||
Exercised (in dollars per share) | $ / shares | $ 0.73 | 0.10 | ||||||||
Forfeited / Cancelled (in dollars per share) | $ / shares | 0.20 | |||||||||
Balance at the end of the period (in dollars per share) | $ / shares | $ 0.71 | $ 0.71 | $ 0.20 | |||||||
Weighted Average Remaining Contractual Life | ||||||||||
Balance at the end of the period | 2 years 1 month 17 days | 3 years 1 month 17 days | ||||||||
Aggregate Intrinsic Value | ||||||||||
Balance at the end of the period | $ | $ 25 | $ 11 | ||||||||
StrataGent Plan | Stock options | StrataGent, Inc. | ||||||||||
Stock-based compensation | ||||||||||
Additional shares available for grant assumed by the entity | 0 | 0 | ||||||||
Shares Available for Grant | ||||||||||
Balance at the end of the period (in shares) | 0 | 0 |
Stock-Based Compensation (Det64
Stock-Based Compensation (Details 2) $ / shares in Units, $ in Thousands | May. 20, 2015$ / shares | Jan. 16, 2015shares | Nov. 20, 2014$ / shares | Nov. 19, 2014$ / shares | Mar. 20, 2014shares | Sep. 30, 2015USD ($)item$ / sharesshares | Sep. 30, 2014USD ($) | Sep. 30, 2013USD ($) | Apr. 02, 2014$ / shares |
Stock-Based Compensation | |||||||||
Stock-based compensation expense | $ | $ 2,714 | $ 1,629 | $ 330 | ||||||
Assumptions used in estimating weighted average fair value of the shares expected to be purchased | |||||||||
Grant Price | $ / shares | $ 10.46 | $ 4.67 | $ 6.80 | ||||||
2014 Employee Stock Purchase Plan | |||||||||
Stock-Based Compensation | |||||||||
Number of shares of common stock initially reserved under plan for issuance to employees | shares | 310,000 | ||||||||
Additional shares authorized | shares | 181,994 | ||||||||
Shares available for issuance | shares | 372,529 | ||||||||
Term of the plan | 10 years | ||||||||
Maximum annual increase in number of shares issuable by the plan, as a percentage of shares outstanding as of the preceding December 31 | 1.00% | ||||||||
Maximum number of shares to be issued over the term of the plan | shares | 4,000,000 | ||||||||
Shares issued under the plan | shares | 119,465 | ||||||||
Offering period | 24 months | ||||||||
Number of purchase windows during each offering period | item | 4 | ||||||||
Period of purchase windows during each offering period | 6 months | ||||||||
Purchase price of common stock of the lower of the fair market value of the Company's common stock (as a percent) | 85.00% | ||||||||
Stock-based compensation expense | $ | $ 500 | $ 300 | |||||||
Assumptions used in estimating weighted average fair value of the shares expected to be purchased | |||||||||
Fair value of common stock | $ / shares | $ 8 | ||||||||
Expected volatility, minimum | 47.00% | ||||||||
Expected volatility, maximum | 64.00% | ||||||||
Risk-free interest rate, minimum | 0.07% | ||||||||
Risk-free interest rate, maximum | 0.63% | ||||||||
Expected dividend rate (as a percent) | 0.00% | ||||||||
Expected term, window one (in months) | 6 months | ||||||||
Expected term, window two (in months) | 12 months | ||||||||
Expected term, window three (in months) | 18 months | ||||||||
Expected term, window four (in months) | 24 months | ||||||||
Shares issued during the period | shares | 119,465 | ||||||||
2014 Employee Stock Purchase Plan | Minimum | |||||||||
Assumptions used in estimating weighted average fair value of the shares expected to be purchased | |||||||||
Fair value of common stock | $ / shares | $ 5.49 | ||||||||
Grant Price | $ / shares | $ 4.67 | ||||||||
Expected term (in years) | 6 months | ||||||||
2014 Employee Stock Purchase Plan | Maximum | |||||||||
Assumptions used in estimating weighted average fair value of the shares expected to be purchased | |||||||||
Fair value of common stock | $ / shares | $ 12.31 | ||||||||
Grant Price | $ / shares | $ 10.46 | ||||||||
Expected term (in years) | 2 years |
Stock-Based Compensation (Det65
Stock-Based Compensation (Details 3) - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2013 | |
Employee stock-based compensation expense | |||
Stock-based compensation | $ 2,714 | $ 1,629 | $ 330 |
Additional Disclosure | |||
Unrecognized employee compensation cost, net of estimated forfeitures | $ 5,200 | ||
Weighted-average period over which unrecognized compensation cost is expected to be recognized | 2 years 8 months 12 days | ||
Cost of product revenues | |||
Employee stock-based compensation expense | |||
Stock-based compensation | $ 344 | 188 | 35 |
Cost of contract research and development revenues | |||
Employee stock-based compensation expense | |||
Stock-based compensation | 187 | 196 | 21 |
Research and development | |||
Employee stock-based compensation expense | |||
Stock-based compensation | 540 | 151 | 39 |
General and administrative | |||
Employee stock-based compensation expense | |||
Stock-based compensation | $ 1,643 | $ 1,094 | $ 235 |
Product Recall Liability (Detai
Product Recall Liability (Details) $ in Thousands | 12 Months Ended | 36 Months Ended | ||
Sep. 30, 2015USD ($) | Sep. 30, 2014USD ($) | Sep. 30, 2013USD ($) | Sep. 30, 2010item | |
Product recall liability | ||||
Revised combined remaining liability | $ 3,710 | $ 4,832 | $ 5,000 | |
Changes to the product recall liability | ||||
Beginning balance | 3,710 | 4,832 | 5,000 | |
Payment of settlement liability | (721) | (1,122) | (168) | |
Ending balance | $ 2,989 | $ 3,710 | $ 4,832 | |
Actavis | ||||
Product recall liability | ||||
Number of voluntary recalls of certain lots and strengths of Fentanyl TDS | item | 2 |
Product Liability (Details)
Product Liability (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2013 | |
Changes to the product liability reserve | |||
Beginning balance | $ 85 | $ 90 | $ 720 |
Settlement payments | (1,300) | ||
Expense (income) | (60) | (5) | 670 |
Ending balance | $ 25 | $ 85 | $ 90 |
Net Loss and Net Loss per Sha68
Net Loss and Net Loss per Share Attributable to Common Stockholders (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||
Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2013 | |
Anti-dilutive securities excluded from calculation of diluted net income (loss) per share attributable to common stockholders | |||||||
Net loss and comprehensive loss | $ (28,450) | $ (9,912) | $ (13,877) | ||||
Weighted-average shares used in computing net loss per share attributable to common stockholders, basic and diluted | 18,709,292 | 10,043,640 | 2,222,981 | ||||
Net loss per share attributable to common stockholders, basic and diluted (in dollars per share) | $ (0.42) | $ (0.33) | $ (0.40) | $ (0.37) | $ (1.52) | $ (0.99) | $ (6.24) |
Convertible Preferred Stock | |||||||
Anti-dilutive securities excluded from calculation of diluted net income (loss) per share attributable to common stockholders | |||||||
Number of anti-dilutive securities excluded from calculation of diluted net income (loss) per share attributable to common stockholders | 3,567,811 | ||||||
Stock options | |||||||
Anti-dilutive securities excluded from calculation of diluted net income (loss) per share attributable to common stockholders | |||||||
Number of anti-dilutive securities excluded from calculation of diluted net income (loss) per share attributable to common stockholders | 2,914,977 | 2,089,586 | 1,781,844 | ||||
Shares authorized under the 2014 ESPP | |||||||
Anti-dilutive securities excluded from calculation of diluted net income (loss) per share attributable to common stockholders | |||||||
Number of anti-dilutive securities excluded from calculation of diluted net income (loss) per share attributable to common stockholders | 372,529 | 310,000 | |||||
Common stock warrants | |||||||
Anti-dilutive securities excluded from calculation of diluted net income (loss) per share attributable to common stockholders | |||||||
Number of anti-dilutive securities excluded from calculation of diluted net income (loss) per share attributable to common stockholders | 51,386 | 128,582 | 1,294,618 | ||||
Preferred stock warrants | |||||||
Anti-dilutive securities excluded from calculation of diluted net income (loss) per share attributable to common stockholders | |||||||
Number of anti-dilutive securities excluded from calculation of diluted net income (loss) per share attributable to common stockholders | 172,276 |
Income Taxes (Details)
Income Taxes (Details) $ in Thousands | 12 Months Ended | ||
Sep. 30, 2015USD ($)item | Sep. 30, 2014USD ($) | Sep. 30, 2013USD ($) | |
Income Taxes | |||
Number of jurisdiction under which Company operates | item | 1 | ||
Reconciliation of the tax expense (benefit) computed at the statutory federal rate and the Company's tax expense (benefit) | |||
Income tax benefit - computed as 34% of pretax loss | $ (9,672) | $ (3,370) | $ (4,717) |
Effect of nondeductible expenses | 551 | 695 | 695 |
State and local income tax expenses | 1 | 1 | 1 |
Valuation allowance | 9,614 | 2,403 | 4,270 |
Effect of tax credits and other | (256) | (13) | (50) |
State deferred taxes | (238) | 285 | (188) |
Other | 3 | (10) | |
Total | $ 3 | 1 | $ 1 |
Statutory federal rate (as a percent) | 34.00% | ||
Deferred tax assets: | |||
Net operating loss carryforward | $ 35,120 | 26,279 | |
Depreciation | 949 | 694 | |
Accrued expenses | 1,427 | 1,686 | |
Research and development tax credit | 2,238 | 1,982 | |
State deferred taxes | 1,890 | 1,651 | |
Other | 1,822 | 1,508 | |
Gross deferred tax assets | 43,446 | 33,800 | |
Valuation allowance | (43,170) | (33,518) | |
Net deferred tax assets | 276 | 282 | |
Deferred tax liabilities: | |||
Other | (276) | (282) | |
Gross deferred tax liabilities | (276) | $ (282) | |
Federal | |||
Operating loss carryforwards | |||
Net operating loss carryforwards | 103,300 | ||
California state | |||
Operating loss carryforwards | |||
Net operating loss carryforwards | $ 16,300 |
Income Taxes (Details 2)
Income Taxes (Details 2) - USD ($) $ in Thousands | 12 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | |
Income Taxes | |||
Increase in valuation allowance | $ 9,700 | $ 2,500 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||
Increases related to prior year tax provisions | 226 | ||
Unrecognized tax benefits, ending balance | 226 | ||
Uncertain tax positions | 226 | $ 226 | |
Interest expense or penalties related to unrecognized tax benefits | $ 0 | ||
Federal | |||
Credit carryforwards | |||
Credit carryforwards amount | 2,200 | ||
California state | |||
Credit carryforwards | |||
Credit carryforwards amount | $ 1,700 |
Employee Benefit Plan (Details)
Employee Benefit Plan (Details) - USD ($) | 12 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2013 | |
Employee Benefit Plan | |||
Contributions amount | $ 101,000 | $ 93,000 | $ 90,000 |
Segment and Enterprise-Wide I72
Segment and Enterprise-Wide Information (Details) | 12 Months Ended |
Sep. 30, 2015item | |
Segment and Enterprise-Wide Information | |
Number of business activities | 1 |
Number of segment managers held accountable for operations, or operating results for levels or components | 0 |
Selected Quarterly Financial 73
Selected Quarterly Financial Data (Unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2013 | |
Selected quarterly results from operations | |||||||||||
Total revenues | $ 9,266 | $ 10,598 | $ 11,291 | $ 9,766 | $ 11,072 | $ 10,183 | $ 10,717 | $ 10,468 | $ 40,921 | $ 42,440 | $ 50,270 |
Operating expenses | 15,956 | 14,592 | 16,541 | 14,856 | 15,869 | 13,580 | 11,511 | 11,530 | 61,945 | 52,490 | 49,069 |
Net income (loss) | $ (8,635) | $ (5,914) | $ (7,142) | $ (6,759) | $ (6,367) | $ (4,981) | $ 3,534 | $ (2,098) | $ (21,024) | $ (10,050) | $ 1,201 |
Net Income (loss) per share attributable to common stockholders, basic (in dollars per share) | $ (0.35) | $ (0.28) | $ 0.50 | $ (0.94) | |||||||
Net Income (loss) per share attributable to common stockholders, diluted (in dollars per share) | $ (0.35) | $ (0.28) | $ 0.33 | $ (0.94) | |||||||
Basic and diluted net loss per common share (in dollars per share) | $ (0.42) | $ (0.33) | $ (0.40) | $ (0.37) | $ (1.52) | $ (0.99) | $ (6.24) |