Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2018 | Nov. 06, 2018 | |
Document and Entity Information | ||
Entity Registrant Name | Bellerophon Therapeutics, Inc. | |
Entity Central Index Key | 1,600,132 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2018 | |
Amendment Flag | false | |
Entity Emerging Growth Company | true | |
Entity Small Business | true | |
Entity Ex Transition Period | true | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 58,679,492 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q3 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 19,552 | $ 28,823 |
Restricted cash | 255 | 402 |
Marketable securities | 998 | 2,996 |
Prepaid expenses and other current assets | 1,738 | 3,359 |
Total current assets | 22,543 | 35,580 |
Restricted cash, non-current | 300 | 150 |
Other non-current assets | 44 | 54 |
Property and equipment, net | 755 | 1,026 |
Total assets | 23,642 | 36,810 |
Current liabilities: | ||
Accounts payable | 4,371 | 3,853 |
Accrued research and development | 3,823 | 1,785 |
Accrued expenses | 880 | 1,441 |
Total current liabilities | 9,074 | 7,079 |
Common stock warrant liabilities | 10,641 | 32,325 |
Total liabilities | 19,715 | 39,404 |
Commitments and contingencies | ||
Stockholders’ equity (deficiency in assets): | ||
Common stock, $0.01 par value per share; 200,000,000 and 125,000,000 shares authorized and 58,679,492 and 56,899,353 shares issued and outstanding at September 30, 2018 and December 31, 2017, respectively, 289,269 shares paid for and to be issued at December 31, 2017 | 587 | 569 |
Preferred stock, $0.01 par value per share; 5,000,000 shares authorized, zero shares issued and outstanding at September 30, 2018 and December 31, 2017 | 0 | 0 |
Additional paid-in capital | 178,925 | 176,151 |
Accumulated other comprehensive loss | (1) | (4) |
Accumulated deficit | (175,584) | (179,310) |
Total stockholders’ equity (deficiency in assets) | 3,927 | (2,594) |
Total liabilities and stockholders’ equity (deficiency in assets) | $ 23,642 | $ 36,810 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2018 | Dec. 31, 2017 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 200,000,000 | 125,000,000 |
Common stock, shares issued (in shares) | 58,679,492 | 56,899,353 |
Common stock, shares outstanding (in shares) | 58,679,492 | 56,899,353 |
Common stock, shares, paid for and to be issued (in shares) | 289,269 | |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred tock, shares authorized (in shares) | 5,000,000 | 5,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Operating expenses: | ||||
Research and development | $ 5,247 | $ 4,438 | $ 17,442 | $ 12,464 |
General and administrative | 1,584 | 1,746 | 5,754 | 4,826 |
Total operating expenses | 6,831 | 6,184 | 23,196 | 17,290 |
Loss from operations | (6,831) | (6,184) | (23,196) | (17,290) |
Change in fair value of common stock warrant liability | 17,840 | (1,435) | 21,201 | (13,455) |
Interest and other income, net | 92 | 33 | 282 | 86 |
Pre-tax income (loss) | 11,101 | (7,586) | (1,713) | (30,659) |
Income tax benefit | 0 | 0 | 5,439 | 0 |
Net income (loss) | $ 11,101 | $ (7,586) | $ 3,726 | $ (30,659) |
Weighted average shares outstanding: | ||||
Basic (in shares) | 57,710,251 | 34,989,831 | 57,356,445 | 33,505,444 |
Diluted (in shares) | 64,544,504 | 34,989,831 | 65,854,903 | 33,505,444 |
Net income (loss) per share: | ||||
Basic (in usd per share) | $ 0.19 | $ (0.22) | $ 0.06 | $ (0.92) |
Diluted (in usd per share) | $ (0.10) | $ (0.22) | $ (0.27) | $ (0.92) |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income (loss) | $ 11,101 | $ (7,586) | $ 3,726 | $ (30,659) |
Other comprehensive income | ||||
Unrealized gains on available-for-sale marketable securities | 2 | 0 | 3 | 0 |
Total other comprehensive income | 2 | 0 | 3 | 0 |
Comprehensive income (loss) | $ 11,103 | $ (7,586) | $ 3,729 | $ (30,659) |
Condensed Consolidated Statem_3
Condensed Consolidated Statement of Changes in Stockholders' Equity - 9 months ended Sep. 30, 2018 - USD ($) $ in Thousands | Total | Common Stock | Additional Paid in Capital | Accumulated Other Comprehensive Income (Loss) | Accumulated Deficit | Warrant | WarrantCommon Stock | WarrantAdditional Paid in Capital |
Balance at beginning of period (in shares) at Dec. 31, 2017 | 56,899,353 | 56,899,353 | ||||||
Balance at beginning of period at Dec. 31, 2017 | $ (2,594) | $ 569 | $ 176,151 | $ (4) | $ (179,310) | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net income (loss) | 3,726 | 3,726 | ||||||
Other comprehensive income | 3 | 3 | ||||||
Warrant exercises (in shares) | 529,093 | |||||||
Warrant exercises | $ 673 | $ 5 | $ 668 | |||||
Exercise of stock options (in shares) | 5,875 | |||||||
Exercise of stock options | 4 | 4 | ||||||
Stock-based compensation (in shares) | 1,245,171 | |||||||
Stock-based compensation | $ 2,115 | $ 13 | 2,102 | |||||
Balance at end of period (in shares) at Sep. 30, 2018 | 58,679,492 | 58,679,492 | ||||||
Balance at end of period at Sep. 30, 2018 | $ 3,927 | $ 587 | $ 178,925 | $ (1) | $ (175,584) |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Cash flows from operating activities: | ||
Net income (loss) | $ 3,726 | $ (30,659) |
Adjustments to reconcile net income (loss) to net cash used in operating activities: | ||
Change in fair value of common stock warrant liability | (21,201) | 13,455 |
Stock based compensation | 2,115 | 2,134 |
Depreciation | 271 | 283 |
Issuance costs attributable to common stock warrant liability | 0 | 111 |
Changes in operating assets and liabilities: | ||
Prepaid expenses and other current assets | 1,621 | 2,397 |
Other non-current assets | 10 | 1,432 |
Accounts payable, accrued research and development, and accrued expenses | 2,023 | (552) |
Net cash used in operating activities | (11,435) | (11,399) |
Cash flows from investing activities: | ||
Purchase of marketable securities | 0 | (2,982) |
Proceeds from sale of marketable securities | 2,001 | 5,375 |
Net cash provided by investing activities | 2,001 | 2,393 |
Cash flows from financing activities: | ||
Proceeds from sale of Units in PIPE Offering, net of offering expenses | (28) | 23,437 |
Proceeds from sale of Units in Direct Offering, net of commissions and offering expenses | 0 | 2,730 |
Proceeds received from exercise of warrants | 190 | 747 |
Proceeds received from exercise of stock options | 4 | 0 |
Payment of offering expenses related to the secondary offering | 0 | (235) |
Net cash provided by financing activities | 166 | 26,679 |
Net change in cash, cash equivalents and restricted cash | (9,268) | 17,673 |
Cash, cash equivalents and restricted cash at beginning of period | 29,375 | 14,910 |
Cash, cash equivalents and restricted cash at end of period | 20,107 | 32,583 |
Non-cash financing activities: | ||
Unpaid expenses related to offerings | 0 | 720 |
Conversion of warrant liability to common stock upon exercise of warrants | $ 483 | $ 1,005 |
Organization and Nature of the
Organization and Nature of the Business | 9 Months Ended |
Sep. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Nature of the Business | Organization and Nature of the Business Bellerophon Therapeutics, Inc., or the Company, is a clinical-stage therapeutics company focused on developing innovative products at the intersection of drugs and devices that address significant unmet medical needs in the treatment of cardiopulmonary diseases. The focus of the Company’s clinical program is the continued development of its nitric oxide therapy for patients with pulmonary hypertension, or PH, using its proprietary delivery system, INOpulse. The Company has three wholly-owned subsidiaries: Bellerophon BCM LLC, a Delaware limited liability company; Bellerophon Pulse Technologies LLC, a Delaware limited liability company; and Bellerophon Services, Inc., a Delaware corporation. The Company’s business is subject to significant risks and uncertainties, including but not limited to: • The risk that the Company will not achieve success in its research and development efforts, including clinical trials conducted by it or its potential collaborative partners. • The expectation that the Company will experience operating losses for the next several years. • Decisions by regulatory authorities regarding whether and when to approve the Company’s regulatory applications as well as their decisions regarding labeling and other matters which could affect the commercial potential of the Company’s products or product candidates. • The risk that the Company will fail to obtain adequate financing to meet its future operational and capital needs. • The risk that the Company will be unable to obtain additional funds on a timely basis and hence there will be substantial doubt about its ability to continue as a going concern. • The risk that key personnel will leave the Company and/or that the Company will be unable to recruit and retain senior level officers to manage its business. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies (a) Basis of Presentation The accompanying unaudited condensed consolidated financial statements were prepared following the requirements of the Securities and Exchange Commission, or the SEC, for interim reporting. As permitted under those rules, certain footnotes or other financial information that are normally required by accounting principles generally accepted in the United States of America, or U.S. GAAP, can be condensed or omitted. The Company operates in one reportable segment and solely within the United States. Accordingly, no segment or geographic information has been presented. The Company is responsible for the unaudited condensed consolidated financial statements. The condensed consolidated financial statements include all normal and recurring adjustments that are considered necessary for the fair presentation of the Company’s financial position, results of operations, comprehensive income (loss) and its cash flows for the periods presented. These condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements for the year ended December 31, 2017 , included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017 . The results of operations for the three and nine months ended September 30, 2018 for the Company are not necessarily indicative of the results expected for the full year. The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of costs and expenses during the reporting period, including accrued expenses, accrued research and development expenses, stock-based compensation, common stock warrant liabilities and income taxes. Actual results could differ from those estimates. (b) Cash and Cash Equivalents The Company considers all highly liquid investments with an original maturity date of three months or less to be cash equivalents. All investments with maturities of greater than three months from date of purchase are classified as available-for-sale marketable securities. (c) Stock-Based Compensation The Company accounts for its stock-based compensation in accordance with applicable accounting guidance which establishes accounting for share-based awards, including stock options and restricted stock, exchanged for services and requires companies to expense the estimated fair value of these awards over the requisite service period. The Company recognizes stock-based compensation expense in operations based on the fair value of the award on the date of the grant. The resulting compensation expense, less estimated forfeitures, is recognized on a straight-line basis over the requisite service period or sooner if the awards immediately vest. The Company determines the fair value of stock options issued using a Black-Scholes-Merton option pricing model. Certain assumptions used in the model include expected volatility, dividend yield, risk-free interest rate, estimated forfeitures and expected term. For restricted stock, the fair value is the closing market price per share on the grant date. See Note 7 - Stock-Based Compensation for a description of these assumptions. (d) Common Stock Warrants and Warrant Liability The Company accounts for common stock warrants issued as freestanding instruments in accordance with applicable accounting guidance as either liabilities or as equity instruments depending on the specific terms of the warrant agreement. The Company classifies warrant liabilities on the consolidated balance sheet based on the warrants' terms as long-term liabilities, which are revalued at each balance sheet date subsequent to the initial issuance. Changes in the fair value of the warrants are reflected in the consolidated statement of operations as “Change in fair value of common stock warrant liability.” The Company uses the Black-Scholes-Merton pricing model to value the related warrant liability. Certain assumptions used in the model include expected volatility, dividend yield and risk-free interest rate. See Note 6 - Fair Value Measurements for a description of these assumptions. (e) Income Taxes The Company uses the asset and liability approach to account for income taxes as required by applicable accounting guidance, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Valuation allowances are provided when necessary to reduce deferred tax assets to the amount expected to be realized, on a more likely than not basis. The Company recognizes the benefit of an uncertain tax position that it has taken or expects to take on income tax returns it files if such tax position is more likely than not to be sustained on examination by the taxing authorities, based on the technical merits of the position. These tax benefits are measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate resolution. (f) Marketable Securities Unrealized gains and losses are reported as accumulated other comprehensive income (loss), except for losses from impairments which are determined to be other-than-temporary. Realized gains and losses, and declines in value judged to be other-than-temporary on available-for-sale securities are included in the determination of net loss and are included in interest and other income, net, at which time the average cost basis of these securities are adjusted to fair value. Fair values are based on quoted market prices at the reporting date. Interest on available-for-sale securities is included in interest and other income, net. (g) Research and Development Expense Research and development costs are expensed as incurred. These expenses include the costs of the Company’s proprietary research and development efforts, as well as costs incurred in connection with certain licensing arrangements. Upfront and milestone payments made to third parties in connection with research and development collaborations are expensed as incurred up to the point of regulatory approval. Payments made to third parties upon or subsequent to regulatory approval are capitalized and amortized over the remaining useful life of the related product. The Company also expenses the cost of purchased technology and equipment in the period of purchase if it believes that the technology or equipment has not demonstrated technological feasibility and it does not have an alternative future use. Nonrefundable advance payments for goods or services that will be used or rendered for future research and development activities are deferred and are recognized as research and development expense as the related goods are delivered or the related services are performed. (i) Recently Issued Accounting Pronouncements Adopted In January 2016, the FASB issued ASU 2016-01, "Financial Instruments - Overall - Recognition and Measurement of Financial Assets and Financial Liabilities," which addresses certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. The Company adopted ASU 2016-01 during the quarter ended March 31, 2018. The adoption of this standard did not have an impact on the Company's financial statements. In August 2016, the FASB issued ASU 2016-15, “Statement of Cash Flows: Clarification of Certain Cash Receipts and Cash Payments”, which eliminates the diversity in practice related to the classification of certain cash receipts and payments in the statement of cash flows, by adding or clarifying guidance on eight specific cash flow issues. ASU 2016-15 provides for retrospective application for all periods presented. The Company adopted ASU 2016-15 during the quarter ended March 31, 2018. The adoption of this standard did not have an impact on the Company's financial statements. In November 2016, the FASB issued ASU 2016-18 "Statement of Cash Flows: Restricted Cash", which eliminates the diversity in practice related to the inclusion of restricted cash in the statement of cash flows by requiring that a statement of cash flows include the change during the period in restricted cash when reconciling beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The Company retrospectively adopted ASU 2016-18 during the quarter ended March 31, 2018 by including restricted cash with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. Not Yet Adopted In February 2016, the FASB issued ASU 2016-02, "Leases," which is intended to improve financial reporting about leasing transactions. This standard requires a lessee to record on the balance sheet the assets and liabilities for the rights and obligations created by lease terms of more than 12 months. This standard will be effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The Company is assessing ASU 2016-02’s impact and will adopt it when effective. In August 2018, the FASB issued ASU 2018-13, "Fair Value Measurement (Topic 820) - Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement", which eliminates, modifies and adds certain disclosure on fair value measurements. This standard will be effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. The Company is assessing ASU 2018-03’s impact and will adopt it when effective. |
Liquidity
Liquidity | 9 Months Ended |
Sep. 30, 2018 | |
Liquidity | |
Liquidity | Liquidity In the course of its development activities, the Company has sustained operating losses and expects such losses to continue over the next several years. The Company expects to continue to incur significant expenses and operating losses for the foreseeable future as it continues the development and clinical trials of, and seeks regulatory approval for, its product candidates. The Company's primary uses of capital are, and it expects will continue to be, compensation and related expenses, third-party clinical research and development services, contract manufacturing services, laboratory and related supplies, clinical costs, legal and other regulatory expenses and general overhead costs. The Company had cash and cash equivalents of $19.6 million and marketable securities of $1.0 million as of September 30, 2018 . The Company's existing cash and cash equivalents and marketable securities as of September 30, 2018 will be used primarily to complete the first cohort and partially complete additional cohorts of the Company's ongoing Phase 2b trial of INOpulse for PH associated with Interstitial Lung Disease, or PH-ILD, and to fund the closeout activities, expected to be completed in the fourth quarter of 2018, of the Phase 3 trial for PAH following our discontinuation of the trial based on the Data Monitoring Committee's recommendation in August 2018. On May 9, 2017, the Company entered into a Securities Purchase Agreement, or the Purchase Agreement, under the shelf registration statement, with a single institutional investor for the sale of 2,000,000 shares of its common stock at a purchase price of $1.50 per share and warrants to purchase up to an aggregate of 1,000,000 shares of its common stock, or the Direct Offering. The warrants became exercisable commencing six months from the issuance date at an exercise price equal to $1.50 per full share of common stock, subject to adjustments as provided under the terms of the warrants. The warrants are exercisable for five years from the initial exercise date. In addition, the Company issued to the placement agent of the Direct Offering warrants to purchase up to 60,000 shares. The placement agent warrants have substantially the same terms as the warrants issued to the investor, except that the placement agent warrants have an exercise price equal to $1.875 and will be exercisable for five years from the date of the closing of the Direct Offering. The closing of the sales of these securities under the Purchase Agreement occurred on May 15, 2017. The aggregate gross and net proceeds for the Direct Offering were $3.0 million and $2.7 million , respectively. On September 26, 2017, the Company entered into a Securities Purchase Agreement, or the PIPE Purchase Agreement, pursuant to which the Company sold an aggregate of 19,449,834 shares of its common stock at a purchase price of $1.205 per share and warrants to purchase up to an aggregate of 19,449,834 shares of its common stock, or the PIPE Offering. The warrants became exercisable commencing six months from the issuance date at an exercise price equal to $1.2420 per full share of common stock, subject to adjustments as provided under the terms of the warrants. The warrants are exercisable for five years from the initial exercise date. The closing of the sales of these securities under the PIPE Purchase Agreement occurred on September 29, 2017. The aggregate gross and net proceeds for the PIPE Offering were $23.4 million and $22.8 million , respectively. The shelf registration statement that was filed in May 2016 was replaced by a new shelf registration statement with the SEC on Form S-3 which became effective on July 6, 2018. The new shelf registration statement allows the Company to issue, from time to time at prices and on terms to be determined prior to the time of any such offering, up to $100 million of any combination of the Company's common stock, preferred stock, debt securities, warrants and rights, either individually or in units. The Company evaluated whether there are any conditions and events, considered in the aggregate, that raise substantial doubt about its ability to continue as a going concern within one year beyond the filing of this Quarterly Report on Form 10-Q. Based on such evaluation, management believes that the Company's existing cash and cash equivalents and marketable securities as of September 30, 2018 may not be sufficient to satisfy the Company's operating cash needs for at least one year after the filing of this Quarterly Report on Form 10-Q. These factors raise substantial doubt about the Company's ability to continue as a going concern. The Company's ability to access funding in any form is not assured and is likely to be influenced by the results of its ongoing Phase 2b trial of INOpulse for PH-ILD and our other ongoing and planned clinical trials. The Company’s estimates and assumptions may prove to be wrong, and the Company may exhaust its capital resources sooner than expected. The process of testing product candidates in clinical trials is costly, and the timing of progress in clinical trials is uncertain. Because the Company’s product candidates are in clinical development and the outcome of these efforts is uncertain, the Company may not be able to accurately estimate the actual amounts that will be necessary to successfully complete the development and commercialization, if approved, of its product candidates or whether, or when, the Company may achieve profitability. Until such time, if ever, as the Company can generate substantial product revenues, it expects to finance its cash needs through a combination of equity and debt offerings, existing working capital and funding from potential future collaboration arrangements. To the extent that the Company raises additional capital through the future sale of equity or debt, the ownership interest of its existing stockholders will be diluted, and the terms of such securities may include liquidation or other preferences or rights such as anti-dilution rights that adversely affect the rights of the Company's existing stockholders. If the Company raises additional funds through strategic partnerships in the future, it may have to relinquish valuable rights to its technologies, future revenue streams or product candidates or grant licenses on terms that may not be favorable to it. If the Company is unable to raise additional funds through equity or debt financings when needed, it may be required to delay, limit, reduce or terminate its product development or future commercialization efforts or grant rights to develop and market product candidates that it would otherwise prefer to develop and market itself. |
Marketable Securities
Marketable Securities | 9 Months Ended |
Sep. 30, 2018 | |
Marketable Securities [Abstract] | |
Marketable Securities | Marketable Securities The Company considers all of its investments to be available-for-sale. Marketable securities were as follows at September 30, 2018 and December 31, 2017 (in thousands): September 30, 2018 December 31, 2017 Amortized Cost Gross Unrealized Losses Fair Value Amortized Cost Gross Unrealized Losses Fair Value US Government bonds $ 999 $ (1 ) $ 998 $ 3,000 $ (4 ) $ 2,996 Total $ 999 $ (1 ) $ 998 $ 3,000 $ (4 ) $ 2,996 Maturities of marketable securities classified as available-for-sale were as follows at September 30, 2018 and December 31, 2017 (in thousands): September 30, 2018 December 31, 2017 Amortized Cost Fair Value Amortized Cost Fair Value Due within one year $ 999 $ 998 $ 3,000 $ 2,996 Total $ 999 $ 998 $ 3,000 $ 2,996 |
Common Stock Warrants and Warra
Common Stock Warrants and Warrant Liability | 9 Months Ended |
Sep. 30, 2018 | |
Common Stock Warrant Liability [Abstract] | |
Common Stock Warrants and Warrant Liability | Common Stock Warrants and Warrant Liability On November 29, 2016, the Company issued warrants to purchase 17,142,858 shares that were immediately exercisable and will expire five years from issuance at an exercise price of $0.80 per share. As the warrants, under certain situations, could require cash settlement, the warrants are classified as liabilities and recorded at estimated fair value using a Black-Scholes-Merton pricing model. As of September 30, 2018 , warrants to purchase 13,741,180 shares were outstanding. On May 15, 2017, the Company issued to an investor a warrant to purchase 1,000,000 shares that became exercisable commencing six months from their issuance and will expire five years from the initial exercise date at an exercise price of $1.50 per share. In addition, the Company issued to the placement agent warrants to purchase 60,000 shares that were immediately exercisable and will expire five years from issuance at an exercise price of $1.875 per share. As the warrants, under certain situations, could require cash settlement, the warrants were classified as liabilities and recorded at estimated fair value using a Black-Scholes-Merton pricing model. As of September 30, 2018 , all of these warrants were outstanding. On September 29, 2017, the Company issued warrants to purchase 19,449,834 shares that became exercisable commencing six months from their issuance and will expire five years from the initial exercise date at an exercise price of $1.2420 per share. As the warrants could not require cash settlement, the warrants were classified as equity. As of September 30, 2018 , all of these warrants were outstanding. The following table summarizes warrant activity for the nine months ended September 30, 2018 (fair value amount in thousands): Equity Classified Liability Classified Warrants Warrants Estimated Fair Value Warrants outstanding as of December 31, 2017 19,449,834 15,041,004 $ 32,325 Exercises — (239,824 ) (483 ) Change in fair value of common stock warrant liability recognized in consolidated statement of operations — — (21,201 ) Warrants outstanding as of September 30, 2018 19,449,834 14,801,180 $ 10,641 The following table summarizes warrant activity for the nine months ended September 30, 2017 (fair value amount in thousands): Equity Classified Liability Classified Warrants Warrants Estimated Fair Value Warrants outstanding as of December 31, 2016 — 17,142,858 $ 5,215 Exercises — (934,300 ) (1,005 ) Additions 19,449,834 1,060,000 1,119 Change in fair value of common stock warrant liability recognized in consolidated statement of operations — — 13,455 Warrants outstanding as of September 30, 2017 19,449,834 17,268,558 $ 18,784 See Note 6 for determination of the fair value of the common stock warrant liability. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements Assets and liabilities recorded at fair value on the balance sheets are categorized based upon the level of judgment associated with the inputs used to measure the fair value. Level inputs are as follows: • Level 1 — Values are based on unadjusted quoted prices for identical assets or liabilities in an active market which the company has the ability to access at the measurement date. • Level 2 — Values are based on quoted market prices in markets where trading occurs infrequently or whose values are based on quoted prices of instruments with similar attributes in active markets. • Level 3 — Values are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. These inputs reflect management’s own assumptions about the assumptions a market participant would use in pricing the asset. The following table summarizes fair value measurements by level at September 30, 2018 for assets and liabilities measured at fair value on a recurring basis (in thousands): Level 1 Level 2 Level 3 Total Marketable securities $ — $ 998 $ — $ 998 Common stock warrant liability — — 10,641 10,641 The following table summarizes fair value measurements by level at December 31, 2017 for assets and liabilities measured at fair value on a recurring basis (in thousands): Level 1 Level 2 Level 3 Total Marketable securities $ — $ 2,996 $ — $ 2,996 Common stock warrant liabilities — — 32,325 32,325 The Company uses a Black-Scholes-Merton option pricing model to value its liability classified common stock warrants. The significant unobservable inputs used in calculating the fair value of common stock warrants represent management’s best estimates and involve inherent uncertainties and the application of management’s judgment. For volatility, the Company uses comparable public companies as a basis for its expected volatility to calculate the fair value of common stock warrants due to its limited history as a public company. The risk-free interest rate is based on U.S. Treasury notes with a term approximating the expected term of the common stock warrant. Any significant changes in the inputs may result in significantly higher or lower fair value measurements. The following are the weighted average assumptions used in estimating the fair value of warrants outstanding as of September 30, 2018 and December 31, 2017 : September 30, 2018 December 31, 2017 Valuation assumptions: Risk-free interest rate 2.87 % 2.08 % Expected volatility 93.50 % 96.24 % Expected term (in years) 3.2 4.0 Dividend yield — % — % |
Stock-Based Compensation
Stock-Based Compensation | 9 Months Ended |
Sep. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation Bellerophon 2015 and 2014 Equity Incentive Plans During 2014, the Company adopted the 2014 Equity Incentive Plan, or the 2014 Plan, which provided for the grant options. Following the effectiveness of the Company's registration statement filed in connection with its IPO, no options may be granted under the 2014 plan. The awards granted under the 2014 Plan generally have a vesting period of between one to four years. During 2015, the Company adopted the 2015 Equity Incentive Plan, or the 2015 Plan, which provides for the grant of options, restricted stock and other forms of equity compensation. On May 4, 2017, the Company’s stockholders approved an amendment to the 2015 Plan to increase the aggregate number of shares available for the grant of awards to 5,000,000 and to increase the maximum number of shares available under the annual increase to 3,000,000 shares. As of September 30, 2018 , the Company had 2,051,395 shares available for grant under the 2015 plan. As of September 30, 2018 , there was approximately $3.4 million of total unrecognized compensation expense related to unvested stock awards. This expense is expected to be recognized over a weighted-average period of 1.9 years. No tax benefit was recognized during the three and nine months ended September 30, 2018 and 2017 related to stock-based compensation expense since the Company incurred operating losses and has established a full valuation allowance to offset all the potential tax benefits associated with its deferred tax assets. Options The weighted average grant-date fair value of options issued during the nine months ended September 30, 2018 and 2017 were $1.55 and $0.84 , respectively. The following are the weighted average assumptions used in estimating the fair values of options issued during the nine months ended September 30, 2018 and 2017. Nine Months Ended September 30, 2018 Nine Months Ended September 30, 2017 Valuation assumptions: Risk-free rate 2.50 % 1.98 % Expected volatility 89.13 % 90.98 % Expected term (years) 5.98 6.0 Dividend yield — — A summary of option activity under the 2015 and 2014 Plans for the nine months ended September 30, 2018 is presented below: Bellerophon 2015 and 2014 Equity Incentive Plans Options Range of Exercise Price Weighted Average Price Weighted Average Remaining Contractual Life (in years) Options outstanding as of December 31, 2017 3,269,883 $ 0.49 - 13.28 $ 3.04 8.4 Granted 1,508,228 2.03 - 2.92 2.09 Exercised (5,875 ) 0.49 - 1.94 0.52 Expired (7,983 ) 13.28 13.28 Forfeited (45,525 ) 0.49 - 4.12 2.20 Options outstanding as of September 30, 2018 4,718,728 $ 0.49 - 13.28 $ 2.73 8.2 Options vested and exercisable as of September 30, 2018 1,324,010 $ 0.49 - 13.28 $ 6.17 7.1 The intrinsic value of options outstanding, vested and exercisable as of September 30, 2018 was $1.1 million . Restricted Stock All restricted stock awards granted under the 2015 Plan during the nine months ended September 30, 2018 were in relation to 2017 and 2018 incentives for employees or director compensation and vest in full less than one year from the grant date. A summary of restricted stock activity under the 2015 Plan for the nine months ended September 30, 2018 is presented below: Bellerophon 2015 Equity Incentive Plan Shares Weighted Average Fair Value Aggregate Grant Date Fair Value (in millions) Weighted Average Remaining Contractual Life (in years) Restricted stock outstanding as of December 31, 2017 328,530 $ 1.42 $ 0.5 0.2 Granted 1,245,171 1.41 1.8 Vested (608,083 ) (1.70 ) (1.0 ) Restricted stock outstanding as of September 30, 2018 965,618 $ 1.23 $ 1.2 0.6 Ikaria Equity Incentive Plans prior to February 12, 2014 Options A summary of option activity under Ikaria incentive plans assumed in 2014 for the nine months ended September 30, 2018 , is presented below: Ikaria Equity Incentive Plans Options Range of Exercise Price Weighted Average Price Weighted Average Remaining Contractual Life (in years) Options outstanding as of December 31, 2017 72,209 $ 7.77 - 17.92 $ 9.21 4.0 Forfeited (2,590 ) 11.65 11.65 — Options outstanding as of September 30, 2018 69,619 $ 7.77 - 17.92 $ 9.12 3.4 Options vested and exercisable as of September 30, 2018 69,619 $ 7.77 - 17.92 $ 9.12 3.4 The intrinsic value of options outstanding, vested and exercisable as of September 30, 2018 was zero . Stock-Based Compensation Expense, Net of Estimated Forfeitures The following table summarizes the stock-based compensation expense by the unaudited condensed consolidated statement of operations line items for the three and nine months ended September 30, 2018 and 2017 (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Research and development $ 87 $ 188 $ 469 $ 661 General and administrative 416 568 1,646 1,473 Total expense $ 503 $ 756 $ 2,115 $ 2,134 |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Excluding the impact of the sale of state net operating losses and research and development credits during the first quarter of 2018, the effective tax rate for each of the three and nine months ended September 30, 2018 and 2017 was 0.0% which was lower than the federal statutory rates primarily due to the losses incurred and the full valuation allowance on deferred tax assets. The Company’s estimated tax rate for 2018 excluding any benefits from any sales of net operating losses or research and development, or R&D, tax credits is expected to be zero because the Company expects to generate additional losses and currently has a full valuation allowance. The valuation allowance is required until the Company has sufficient positive evidence of taxable income necessary to support realization of its deferred tax assets. In addition, the Company may be subject to certain limitations in its annual utilization of NOL carry forwards to offset future taxable income (and of tax credit carry forwards to offset future tax expense) pursuant to Section 382 of the Internal Revenue Code, which could result in tax attributes expiring unused. In February 2018, the Company has sold $61.5 million of state NOLs and $0.2 million of research and development credits under the State of New Jersey's Technology Business Tax Certificate Transfer Program for net proceeds of $5.3 million which resulted in the reversal of the valuation allowance and a tax benefit of $5.4 million for the nine months ended September 30, 2018 and, subject to state approval, plans to sell additional NOLs and credits under the same program in 2018 as well. As of September 30, 2018 , there were no material uncertain tax positions. There are no tax positions for which a material change in any unrecognized tax benefit liability is reasonably possible in the next 12 months. |
Net Income (Loss) Per Share
Net Income (Loss) Per Share | 9 Months Ended |
Sep. 30, 2018 | |
Earnings Per Share [Abstract] | |
Net Income (Loss) Per Share | Net Income (Loss) Per Share Three months ended September 30, Nine months ended September 30, 2018 2017 2018 2017 Net income (loss) $ 11,101 $ (7,586 ) $ 3,726 $ (30,659 ) Weighted-average shares: Basic 57,710,251 34,989,831 57,356,445 33,505,444 Effect of dilutive securities: Warrants 6,834,253 — 8,498,458 — Diluted 64,544,504 34,989,831 65,854,903 33,505,444 Net income (loss) per share: Basic $ 0.19 $ (0.22 ) $ 0.06 $ (0.92 ) Diluted $ (0.10 ) $ (0.22 ) $ (0.27 ) $ (0.92 ) For the nine months ended September 30, 2018 , the total number of potential shares of common stock excluded from the diluted earnings per share computation because their inclusion would have been anti-dilutive was 31.6 million which included 4.8 million options to purchase shares, 1.0 million restricted shares and 25.8 million warrants to purchase shares. For the three months ended September 30, 2018 , the total number of potential shares of common stock excluded from the diluted earnings per share computation because their inclusion would have been anti-dilutive was 33.2 million which included 4.8 million options to purchase shares, 1.0 million restricted shares and 27.4 million warrants to purchase shares. As of September 30, 2017 , the Company had 3.3 million options to purchase shares, 0.7 million restricted shares and 36.7 million warrants to purchase shares outstanding that have been excluded from the computation of diluted weighted average shares outstanding, because such securities had an anti-dilutive impact due to the loss reported. Basic net income (loss) per share is calculated by dividing net income (loss) by the weighted average number of shares outstanding during the period, as applicable. Diluted net loss per share is calculated by dividing net income (loss), adjusted to reflect the impact of dilutive warrants, by the weighted average number of shares outstanding, adjusted to reflect potentially dilutive securities using the treasury stock method, except when the effect would be anti-dilutive. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Legal Proceedings The Company periodically becomes subject to legal proceedings and claims arising in connection with its business. The ultimate legal and financial liability of the Company in respect to all proceedings, claims and lawsuits, pending or threatened, cannot be estimated with any certainty. As of this report, the Company is not aware of any proceeding, claim or litigation, pending or threatened, that could, individually or in the aggregate, have a material adverse effect on the Company’s business, operating results, financial condition and/or liquidity. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated financial statements were prepared following the requirements of the Securities and Exchange Commission, or the SEC, for interim reporting. As permitted under those rules, certain footnotes or other financial information that are normally required by accounting principles generally accepted in the United States of America, or U.S. GAAP, can be condensed or omitted. The Company operates in one reportable segment and solely within the United States. Accordingly, no segment or geographic information has been presented. The Company is responsible for the unaudited condensed consolidated financial statements. The condensed consolidated financial statements include all normal and recurring adjustments that are considered necessary for the fair presentation of the Company’s financial position, results of operations, comprehensive income (loss) and its cash flows for the periods presented. These condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements for the year ended December 31, 2017 , included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017 . The results of operations for the three and nine months ended September 30, 2018 for the Company are not necessarily indicative of the results expected for the full year. The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of costs and expenses during the reporting period, including accrued expenses, accrued research and development expenses, stock-based compensation, common stock warrant liabilities and income taxes. Actual results could differ from those estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid investments with an original maturity date of three months or less to be cash equivalents. All investments with maturities of greater than three months from date of purchase are classified as available-for-sale marketable securities. |
Stock-Based Compensation | Stock-Based Compensation The Company accounts for its stock-based compensation in accordance with applicable accounting guidance which establishes accounting for share-based awards, including stock options and restricted stock, exchanged for services and requires companies to expense the estimated fair value of these awards over the requisite service period. The Company recognizes stock-based compensation expense in operations based on the fair value of the award on the date of the grant. The resulting compensation expense, less estimated forfeitures, is recognized on a straight-line basis over the requisite service period or sooner if the awards immediately vest. The Company determines the fair value of stock options issued using a Black-Scholes-Merton option pricing model. Certain assumptions used in the model include expected volatility, dividend yield, risk-free interest rate, estimated forfeitures and expected term. For restricted stock, the fair value is the closing market price per share on the grant date. See Note 7 - Stock-Based Compensation for a description of these assumptions. |
Common Stock Warrants and Warrant Liability | Common Stock Warrants and Warrant Liability The Company accounts for common stock warrants issued as freestanding instruments in accordance with applicable accounting guidance as either liabilities or as equity instruments depending on the specific terms of the warrant agreement. The Company classifies warrant liabilities on the consolidated balance sheet based on the warrants' terms as long-term liabilities, which are revalued at each balance sheet date subsequent to the initial issuance. Changes in the fair value of the warrants are reflected in the consolidated statement of operations as “Change in fair value of common stock warrant liability.” The Company uses the Black-Scholes-Merton pricing model to value the related warrant liability. Certain assumptions used in the model include expected volatility, dividend yield and risk-free interest rate. See Note 6 - Fair Value Measurements for a description of these assumptions. |
Income Taxes | Income Taxes The Company uses the asset and liability approach to account for income taxes as required by applicable accounting guidance, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Valuation allowances are provided when necessary to reduce deferred tax assets to the amount expected to be realized, on a more likely than not basis. The Company recognizes the benefit of an uncertain tax position that it has taken or expects to take on income tax returns it files if such tax position is more likely than not to be sustained on examination by the taxing authorities, based on the technical merits of the position. These tax benefits are measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate resolution. |
Marketable Securities | Marketable Securities Unrealized gains and losses are reported as accumulated other comprehensive income (loss), except for losses from impairments which are determined to be other-than-temporary. Realized gains and losses, and declines in value judged to be other-than-temporary on available-for-sale securities are included in the determination of net loss and are included in interest and other income, net, at which time the average cost basis of these securities are adjusted to fair value. Fair values are based on quoted market prices at the reporting date. Interest on available-for-sale securities is included in interest and other income, net. |
Research and Development Expense | Research and Development Expense Research and development costs are expensed as incurred. These expenses include the costs of the Company’s proprietary research and development efforts, as well as costs incurred in connection with certain licensing arrangements. Upfront and milestone payments made to third parties in connection with research and development collaborations are expensed as incurred up to the point of regulatory approval. Payments made to third parties upon or subsequent to regulatory approval are capitalized and amortized over the remaining useful life of the related product. The Company also expenses the cost of purchased technology and equipment in the period of purchase if it believes that the technology or equipment has not demonstrated technological feasibility and it does not have an alternative future use. Nonrefundable advance payments for goods or services that will be used or rendered for future research and development activities are deferred and are recognized as research and development expense as the related goods are delivered or the related services are performed. |
New Accounting Pronouncements | Recently Issued Accounting Pronouncements Adopted In January 2016, the FASB issued ASU 2016-01, "Financial Instruments - Overall - Recognition and Measurement of Financial Assets and Financial Liabilities," which addresses certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. The Company adopted ASU 2016-01 during the quarter ended March 31, 2018. The adoption of this standard did not have an impact on the Company's financial statements. In August 2016, the FASB issued ASU 2016-15, “Statement of Cash Flows: Clarification of Certain Cash Receipts and Cash Payments”, which eliminates the diversity in practice related to the classification of certain cash receipts and payments in the statement of cash flows, by adding or clarifying guidance on eight specific cash flow issues. ASU 2016-15 provides for retrospective application for all periods presented. The Company adopted ASU 2016-15 during the quarter ended March 31, 2018. The adoption of this standard did not have an impact on the Company's financial statements. In November 2016, the FASB issued ASU 2016-18 "Statement of Cash Flows: Restricted Cash", which eliminates the diversity in practice related to the inclusion of restricted cash in the statement of cash flows by requiring that a statement of cash flows include the change during the period in restricted cash when reconciling beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The Company retrospectively adopted ASU 2016-18 during the quarter ended March 31, 2018 by including restricted cash with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. Not Yet Adopted In February 2016, the FASB issued ASU 2016-02, "Leases," which is intended to improve financial reporting about leasing transactions. This standard requires a lessee to record on the balance sheet the assets and liabilities for the rights and obligations created by lease terms of more than 12 months. This standard will be effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The Company is assessing ASU 2016-02’s impact and will adopt it when effective. In August 2018, the FASB issued ASU 2018-13, "Fair Value Measurement (Topic 820) - Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement", which eliminates, modifies and adds certain disclosure on fair value measurements. This standard will be effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. The Company is assessing ASU 2018-03’s impact and will adopt it when effective. |
Marketable Securities (Tables)
Marketable Securities (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Marketable Securities [Abstract] | |
Schedule of available-for-sale securities reconciliation | The Company considers all of its investments to be available-for-sale. Marketable securities were as follows at September 30, 2018 and December 31, 2017 (in thousands): September 30, 2018 December 31, 2017 Amortized Cost Gross Unrealized Losses Fair Value Amortized Cost Gross Unrealized Losses Fair Value US Government bonds $ 999 $ (1 ) $ 998 $ 3,000 $ (4 ) $ 2,996 Total $ 999 $ (1 ) $ 998 $ 3,000 $ (4 ) $ 2,996 |
Available-for-sale securities | Maturities of marketable securities classified as available-for-sale were as follows at September 30, 2018 and December 31, 2017 (in thousands): September 30, 2018 December 31, 2017 Amortized Cost Fair Value Amortized Cost Fair Value Due within one year $ 999 $ 998 $ 3,000 $ 2,996 Total $ 999 $ 998 $ 3,000 $ 2,996 |
Common Stock Warrants and War_2
Common Stock Warrants and Warrant Liability (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Common Stock Warrant Liability [Abstract] | |
Schedule of warrant activity | The following table summarizes warrant activity for the nine months ended September 30, 2018 (fair value amount in thousands): Equity Classified Liability Classified Warrants Warrants Estimated Fair Value Warrants outstanding as of December 31, 2017 19,449,834 15,041,004 $ 32,325 Exercises — (239,824 ) (483 ) Change in fair value of common stock warrant liability recognized in consolidated statement of operations — — (21,201 ) Warrants outstanding as of September 30, 2018 19,449,834 14,801,180 $ 10,641 The following table summarizes warrant activity for the nine months ended September 30, 2017 (fair value amount in thousands): Equity Classified Liability Classified Warrants Warrants Estimated Fair Value Warrants outstanding as of December 31, 2016 — 17,142,858 $ 5,215 Exercises — (934,300 ) (1,005 ) Additions 19,449,834 1,060,000 1,119 Change in fair value of common stock warrant liability recognized in consolidated statement of operations — — 13,455 Warrants outstanding as of September 30, 2017 19,449,834 17,268,558 $ 18,784 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Summary of fair value measurements by level | The following table summarizes fair value measurements by level at September 30, 2018 for assets and liabilities measured at fair value on a recurring basis (in thousands): Level 1 Level 2 Level 3 Total Marketable securities $ — $ 998 $ — $ 998 Common stock warrant liability — — 10,641 10,641 The following table summarizes fair value measurements by level at December 31, 2017 for assets and liabilities measured at fair value on a recurring basis (in thousands): Level 1 Level 2 Level 3 Total Marketable securities $ — $ 2,996 $ — $ 2,996 Common stock warrant liabilities — — 32,325 32,325 |
Fair value inputs | The following are the weighted average assumptions used in estimating the fair value of warrants outstanding as of September 30, 2018 and December 31, 2017 : September 30, 2018 December 31, 2017 Valuation assumptions: Risk-free interest rate 2.87 % 2.08 % Expected volatility 93.50 % 96.24 % Expected term (in years) 3.2 4.0 Dividend yield — % — % |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Assumptions used in estimating the fair value of options issued | The following are the weighted average assumptions used in estimating the fair values of options issued during the nine months ended September 30, 2018 and 2017. Nine Months Ended September 30, 2018 Nine Months Ended September 30, 2017 Valuation assumptions: Risk-free rate 2.50 % 1.98 % Expected volatility 89.13 % 90.98 % Expected term (years) 5.98 6.0 Dividend yield — — |
Summary of option activity | A summary of option activity under the 2015 and 2014 Plans for the nine months ended September 30, 2018 is presented below: Bellerophon 2015 and 2014 Equity Incentive Plans Options Range of Exercise Price Weighted Average Price Weighted Average Remaining Contractual Life (in years) Options outstanding as of December 31, 2017 3,269,883 $ 0.49 - 13.28 $ 3.04 8.4 Granted 1,508,228 2.03 - 2.92 2.09 Exercised (5,875 ) 0.49 - 1.94 0.52 Expired (7,983 ) 13.28 13.28 Forfeited (45,525 ) 0.49 - 4.12 2.20 Options outstanding as of September 30, 2018 4,718,728 $ 0.49 - 13.28 $ 2.73 8.2 Options vested and exercisable as of September 30, 2018 1,324,010 $ 0.49 - 13.28 $ 6.17 7.1 The following table summarizes the stock-based compensation expense by the unaudited condensed consolidated statement of operations line items for the three and nine months ended September 30, 2018 and 2017 (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Research and development $ 87 $ 188 $ 469 $ 661 General and administrative 416 568 1,646 1,473 Total expense $ 503 $ 756 $ 2,115 $ 2,134 |
Summary of restricted stock activity | A summary of restricted stock activity under the 2015 Plan for the nine months ended September 30, 2018 is presented below: Bellerophon 2015 Equity Incentive Plan Shares Weighted Average Fair Value Aggregate Grant Date Fair Value (in millions) Weighted Average Remaining Contractual Life (in years) Restricted stock outstanding as of December 31, 2017 328,530 $ 1.42 $ 0.5 0.2 Granted 1,245,171 1.41 1.8 Vested (608,083 ) (1.70 ) (1.0 ) Restricted stock outstanding as of September 30, 2018 965,618 $ 1.23 $ 1.2 0.6 |
Summary of stock-based compensation expense by the condensed consolidated statement of operations line item | A summary of option activity under Ikaria incentive plans assumed in 2014 for the nine months ended September 30, 2018 , is presented below: Ikaria Equity Incentive Plans Options Range of Exercise Price Weighted Average Price Weighted Average Remaining Contractual Life (in years) Options outstanding as of December 31, 2017 72,209 $ 7.77 - 17.92 $ 9.21 4.0 Forfeited (2,590 ) 11.65 11.65 — Options outstanding as of September 30, 2018 69,619 $ 7.77 - 17.92 $ 9.12 3.4 Options vested and exercisable as of September 30, 2018 69,619 $ 7.77 - 17.92 $ 9.12 3.4 |
Net Income (Loss) Per Share (Ta
Net Income (Loss) Per Share (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Earnings Per Share [Abstract] | |
Schedule of earnings per share | Three months ended September 30, Nine months ended September 30, 2018 2017 2018 2017 Net income (loss) $ 11,101 $ (7,586 ) $ 3,726 $ (30,659 ) Weighted-average shares: Basic 57,710,251 34,989,831 57,356,445 33,505,444 Effect of dilutive securities: Warrants 6,834,253 — 8,498,458 — Diluted 64,544,504 34,989,831 65,854,903 33,505,444 Net income (loss) per share: Basic $ 0.19 $ (0.22 ) $ 0.06 $ (0.92 ) Diluted $ (0.10 ) $ (0.22 ) $ (0.27 ) $ (0.92 ) |
Organization and Nature of th_2
Organization and Nature of the Business (Details) | Sep. 30, 2018subsidiary |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of subsidiaries | 3 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details) | 9 Months Ended |
Sep. 30, 2018integer | |
Accounting Policies [Abstract] | |
Number of reportable segments | 1 |
Liquidity (Details)
Liquidity (Details) - USD ($) | Sep. 29, 2018 | Sep. 29, 2017 | May 15, 2017 | May 09, 2017 | Nov. 29, 2016 | Sep. 30, 2018 | Sep. 30, 2017 | Jun. 25, 2018 | Dec. 31, 2017 |
Liquidity [Line Items] | |||||||||
Cash and cash equivalents | $ 19,552,000 | $ 28,823,000 | |||||||
Marketable securities | 998,000 | $ 2,996,000 | |||||||
Maximum securities shelf offering | $ 100,000,000 | ||||||||
Stock issued during period (in shares) | 19,449,834 | 2,000,000 | |||||||
Price to the public (in dollars per share) | $ 1.205 | $ 1.2420 | $ 1.50 | $ 1.50 | |||||
Warrants issued (in shares) | 19,449,834 | 1,000,000 | 17,142,858 | ||||||
Period of time after issuance date before exercisable | 6 months | 6 months | 6 months | 6 months | |||||
Exercise price of warrants (in usd per share) | $ 1.2420 | $ 1.50 | $ 0.80 | ||||||
Proceeds from issuance or sale of equity | $ 23,400,000 | ||||||||
Proceeds from sale of Units in PIPE Offering, net of offering expenses | $ 22,800,000 | $ (28,000) | $ 23,437,000 | ||||||
Warrants expiration | 5 years | 5 years | 5 years | 5 years | 5 years | ||||
Proceeds from issuance of private placement | $ 3,000,000 | ||||||||
Proceeds from issuance of private placement, net | $ 2,700,000 | ||||||||
Placement Agent | |||||||||
Liquidity [Line Items] | |||||||||
Warrants issued (in shares) | 60,000 | 60,000 | |||||||
Exercise price of warrants (in usd per share) | $ 1.875 | $ 1.875 |
Marketable Securities - Availab
Marketable Securities - Available-for-sale Securities Reconciliation (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Debt Securities, Available-for-sale [Line Items] | ||
Total | $ 999 | $ 3,000 |
Gross Unrealized Losses | (1) | (4) |
Fair Value | 998 | 2,996 |
US Government bonds | ||
Debt Securities, Available-for-sale [Line Items] | ||
Total | 999 | 3,000 |
Gross Unrealized Losses | (1) | (4) |
Fair Value | $ 998 | $ 2,996 |
Marketable Securities - Investm
Marketable Securities - Investments in Debt and Marketable Equity Securities (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Amortized Cost | ||
Due within one year | $ 999 | $ 3,000 |
Total | 999 | 3,000 |
Fair Value | ||
Due within one year | 998 | 2,996 |
Total | $ 998 | $ 2,996 |
Common Stock Warrants and War_3
Common Stock Warrants and Warrant Liability - Narrative (Details) - $ / shares | Sep. 29, 2018 | Sep. 29, 2017 | May 15, 2017 | May 09, 2017 | Nov. 29, 2016 | Sep. 30, 2018 |
Class of Warrant or Right [Line Items] | ||||||
Warrants issued (in shares) | 19,449,834 | 1,000,000 | 17,142,858 | |||
Warrants expiration | 5 years | 5 years | 5 years | 5 years | 5 years | |
Exercise price of warrants (in usd per share) | $ 1.2420 | $ 1.50 | $ 0.80 | |||
Period of time after issuance date before exercisable | 6 months | 6 months | 6 months | 6 months | ||
Price to the public (in dollars per share) | $ 1.205 | $ 1.2420 | $ 1.50 | $ 1.50 | ||
Secondary Offering | ||||||
Class of Warrant or Right [Line Items] | ||||||
Class of warrant, outstanding (in shares) | 13,741,180 | |||||
Investor | ||||||
Class of Warrant or Right [Line Items] | ||||||
Warrants issued (in shares) | 19,449,834 | 1,000,000 | ||||
Placement Agent | ||||||
Class of Warrant or Right [Line Items] | ||||||
Warrants issued (in shares) | 60,000 | 60,000 | ||||
Exercise price of warrants (in usd per share) | $ 1.875 | $ 1.875 |
Common Stock Warrants and War_4
Common Stock Warrants and Warrant Liability - Warrant Activity (Details) - USD ($) $ in Thousands | Sep. 29, 2018 | May 09, 2017 | Nov. 29, 2016 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 |
Warrants | |||||||
Additions (in shares) | 19,449,834 | 1,000,000 | 17,142,858 | ||||
Estimated Fair Value | |||||||
Beginning balance, Warrants outstanding | $ 32,325 | $ 5,215 | |||||
Conversion of warrant liability to common stock upon exercise of warrants | (483) | (1,005) | |||||
Warrants issued fair value | 1,119 | ||||||
Change in fair value of common stock warrant liability recognized in consolidated statement of operations | $ (17,840) | $ 1,435 | (21,201) | 13,455 | |||
Ending balance, Warrants outstanding | $ 10,641 | $ 18,784 | $ 10,641 | $ 18,784 | |||
Equity Classified | |||||||
Warrants | |||||||
Beginning balance, Outstanding (in shares) | 19,449,834 | 0 | |||||
Exercises (in shares) | 0 | 0 | |||||
Additions (in shares) | 19,449,834 | ||||||
Ending balance, Outstanding (in shares) | 19,449,834 | 19,449,834 | 19,449,834 | 19,449,834 | |||
Liability Classified | |||||||
Warrants | |||||||
Beginning balance, Outstanding (in shares) | 15,041,004 | 17,142,858 | |||||
Exercises (in shares) | (239,824) | (934,300) | |||||
Additions (in shares) | 1,060,000 | ||||||
Ending balance, Outstanding (in shares) | 14,801,180 | 17,268,558 | 14,801,180 | 17,268,558 |
Fair Value Measurements - Fair
Fair Value Measurements - Fair Value Hierarchy (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Common stock warrant liabilities | $ 10,641 | $ 32,325 |
Recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Common stock warrant liabilities | 10,641 | 32,325 |
Recurring | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Common stock warrant liabilities | 0 | 0 |
Recurring | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Common stock warrant liabilities | 0 | 0 |
Recurring | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Common stock warrant liabilities | 10,641 | 32,325 |
Recurring | Marketable securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | 998 | 2,996 |
Recurring | Marketable securities | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | 0 | 0 |
Recurring | Marketable securities | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | 998 | 2,996 |
Recurring | Marketable securities | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | $ 0 | $ 0 |
Fair Value Measurements - Assum
Fair Value Measurements - Assumptions Used (Details) | Sep. 30, 2018 | Dec. 31, 2017 |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Expected term (in years) | 3 years 2 months 12 days | 4 years |
Risk-free interest rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Valuation assumptions | 0.0287 | 0.0208 |
Expected volatility | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Valuation assumptions | 0.9350 | 0.9624 |
Dividend yield | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Valuation assumptions | 0 | 0 |
Stock-Based Compensation - Narr
Stock-Based Compensation - Narrative (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | May 04, 2017 | |
Stock-Based Compensation | |||||
Number of shares available for grant (in shares) | 5,000,000 | ||||
Maximum annual increase number of shares available for grant (in shares) | 3,000,000 | ||||
Number of shares available for grant (in shares) | 2,051,395 | 2,051,395 | |||
Weighted average grant-date fair value of options issued (in usd per share) | $ 1.55 | $ 0.84 | |||
Options, exercisable, intrinsic value | $ 1,100,000 | $ 1,100,000 | |||
Bellerophon Equity Incentive Plans | |||||
Stock-Based Compensation | |||||
Unrecognized compensation expense | 3,400,000 | $ 3,400,000 | |||
Weighted-average period unrecognized compensation expense is to be recognized | 1 year 10 months 24 days | ||||
Tax benefit recognized related to stock-based compensation expense | 0 | $ 0 | $ 0 | $ 0 | |
Ikaria Equity Incentive Plans | |||||
Stock-Based Compensation | |||||
Options, outstanding, intrinsic value | $ 0 | $ 0 | |||
Bellerophon 2015 Equity Incentive Plan | Restricted stock outstanding | |||||
Stock-Based Compensation | |||||
Vesting period | 1 year | ||||
Minimum | |||||
Stock-Based Compensation | |||||
Vesting period | 1 year | ||||
Maximum | |||||
Stock-Based Compensation | |||||
Vesting period | 4 years |
Stock-Based Compensation - Summ
Stock-Based Compensation - Summary of Fair Value of Options Issued (Details) - Bellerophon Equity Incentive Plans | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Risk-free rate | 2.50% | 1.98% |
Expected volatility | 89.13% | 90.98% |
Expected term (years) | 5 years 11 months 23 days | 6 years |
Dividend yield | 0.00% | 0.00% |
Stock-Based Compensation - Su_2
Stock-Based Compensation - Summary of Option Activity (Details) - $ / shares | 9 Months Ended | 12 Months Ended |
Sep. 30, 2018 | Dec. 31, 2017 | |
Bellerophon 2015 and 2014 Equity Incentive Plans | ||
Options | ||
Options outstanding as of beginning of period (in shares) | 3,269,883 | |
Granted (in shares) | 1,508,228 | |
Exercised (in shares) | (5,875) | |
Expired (in shares) | (7,983) | |
Forfeited (in shares) | (45,525) | |
Options outstanding as of end of period (in shares) | 4,718,728 | 3,269,883 |
Options vested and exercisable (in shares) | 1,324,010 | |
Range of Exercise Price | ||
Options expired, Exercise Price, (in dollars per share) | $ 13.28 | |
Weighted Average Price | ||
Options outstanding as of beginning of period, Weighted Average Price (in dollars per share) | 3.04 | |
Granted, Weighted Average Price (in dollars per share) | 2.09 | |
Exercised, Weighted Average Price (in dollars per share) | 0.52 | |
Expired, Weighted Average Price (in dollars per share) | 13.28 | |
Forfeited, Weighted Average Price (in dollars per share) | 2.20 | |
Options outstanding as of end of period, Weighted Average Price (in dollars per share) | 2.73 | $ 3.04 |
Options vested and exercisable, Weighted Average Price (in dollars per share) | $ 6.17 | |
Weighted Average Remaining Contractual Life (in years) | ||
Options outstanding | 8 years 2 months 12 days | 8 years 4 months 24 days |
Options vested and exercisable | 7 years 1 month 6 days | |
Bellerophon 2015 and 2014 Equity Incentive Plans | Minimum | ||
Range of Exercise Price | ||
Options outstanding as of beginning of period, Exercise Price (in dollars per share) | $ 0.49 | |
Options granted, Exercise Price, (in dollars per share) | 2.03 | |
Options exercised, Exercise Price, (in dollars per share) | 0.49 | |
Options forfeited, Exercise Price, (in dollars per share) | 0.49 | |
Options outstanding as of end of period, Exercise Price (in dollars per share) | 0.49 | $ 0.49 |
Options vested and exercisable, Exercise Price (in dollars per share) | 0.49 | |
Bellerophon 2015 and 2014 Equity Incentive Plans | Maximum | ||
Range of Exercise Price | ||
Options outstanding as of beginning of period, Exercise Price (in dollars per share) | 13.28 | |
Options granted, Exercise Price, (in dollars per share) | 2.92 | |
Options exercised, Exercise Price, (in dollars per share) | 1.94 | |
Options forfeited, Exercise Price, (in dollars per share) | 4.12 | |
Options outstanding as of end of period, Exercise Price (in dollars per share) | 13.28 | $ 13.28 |
Options vested and exercisable, Exercise Price (in dollars per share) | $ 13.28 | |
Ikaria Equity Incentive Plans | ||
Options | ||
Options outstanding as of beginning of period (in shares) | 72,209 | |
Forfeited (in shares) | (2,590) | |
Options outstanding as of end of period (in shares) | 69,619 | 72,209 |
Options vested and exercisable (in shares) | 69,619 | |
Weighted Average Price | ||
Options outstanding as of beginning of period, Weighted Average Price (in dollars per share) | $ 9.21 | |
Forfeited, Weighted Average Price (in dollars per share) | 11.65 | |
Options outstanding as of end of period, Weighted Average Price (in dollars per share) | 9.12 | $ 9.21 |
Options vested and exercisable, Weighted Average Price (in dollars per share) | $ 9.12 | |
Weighted Average Remaining Contractual Life (in years) | ||
Options vested and exercisable | 3 years 4 months 24 days | 4 years |
Ikaria Equity Incentive Plans | Minimum | ||
Range of Exercise Price | ||
Options outstanding as of beginning of period, Exercise Price (in dollars per share) | $ 7.77 | |
Options forfeited, Exercise Price, (in dollars per share) | 11.65 | |
Options outstanding as of end of period, Exercise Price (in dollars per share) | 7.77 | $ 7.77 |
Options vested and exercisable, Exercise Price (in dollars per share) | 7.77 | |
Ikaria Equity Incentive Plans | Maximum | ||
Range of Exercise Price | ||
Options outstanding as of beginning of period, Exercise Price (in dollars per share) | 17.92 | |
Options outstanding as of end of period, Exercise Price (in dollars per share) | 17.92 | $ 17.92 |
Options vested and exercisable, Exercise Price (in dollars per share) | $ 17.92 |
Stock-Based Compensation - Su_3
Stock-Based Compensation - Summary of Restricted Stock Activity (Details) - Bellerophon 2015 Equity Incentive Plan - USD ($) $ / shares in Units, $ in Millions | 9 Months Ended | 12 Months Ended |
Sep. 30, 2018 | Dec. 31, 2017 | |
Shares | ||
Restricted stock outstanding, beginning of period (in shares) | 328,530 | |
Restricted stock granted (in shares) | 1,245,171 | |
Restricted stock forfeited (in shares) | (608,083) | |
Restricted stock outstanding, end of period (in shares) | 965,618 | 328,530 |
Weighted Average Fair Value | ||
Beginning of period, weighted average fair value (in usd per share) | $ 1.42 | |
Restricted stock granted, weighted average fair value (in usd per share) | 1.41 | |
Restricted stock forfeited, weighted average fair value (in usd per share) | (1.70) | |
End of period, weighted average fair value (in usd per share) | $ 1.23 | $ 1.42 |
Aggregate Grant Date Fair Value | ||
Restricted stock beginning of period, aggregate grant date fair value | $ 0.5 | |
Restricted stock granted, aggregate grant date fair value | 1.8 | |
Restricted stock forfeited, aggregate grant date fair value | (1) | |
Restricted stock end of period, aggregate grant date fair value | $ 1.2 | $ 0.5 |
Weighted Average Remaining Contractual Life (in years) | ||
Restricted stock, weighted average remaining contractual life (in years) | 7 months 6 days | 2 months 12 days |
Stock-Based Compensation - Allo
Stock-Based Compensation - Allocation of Recognized Period Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Stock-based compensation expense by condensed consolidated statement of operations and comprehensive loss line item | ||||
Allocated share-based compensation expense | $ 503 | $ 756 | $ 2,115 | $ 2,134 |
Research and development | ||||
Stock-based compensation expense by condensed consolidated statement of operations and comprehensive loss line item | ||||
Allocated share-based compensation expense | 87 | 188 | 469 | 661 |
General and administrative | ||||
Stock-based compensation expense by condensed consolidated statement of operations and comprehensive loss line item | ||||
Allocated share-based compensation expense | $ 416 | $ 568 | $ 1,646 | $ 1,473 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Feb. 28, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2018 | |
Valuation Allowance [Line Items] | ||||||
Effective tax rate (as a percent) | 0.00% | 0.00% | 0.00% | 0.00% | ||
Proceeds from sale of deferred tax assets | $ 5,300,000 | |||||
Income tax benefit | $ 0 | $ 0 | $ 5,439,000 | $ 0 | ||
Expected change to unrecognized tax benefit liability in next twelve months | $ 0 | $ 0 | ||||
Scenario, Forecast | ||||||
Valuation Allowance [Line Items] | ||||||
Effective tax rate (as a percent) | 0.00% | |||||
New Jersey | ||||||
Valuation Allowance [Line Items] | ||||||
Deferred tax assets, , amount sold | 61,500,000 | |||||
Deferred tax assets, research, amount sold | $ 200,000 |
Net Income (Loss) Per Share - C
Net Income (Loss) Per Share - Calculation (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Earnings Per Share [Abstract] | ||||
Net income (loss) | $ 11,101 | $ (7,586) | $ 3,726 | $ (30,659) |
Weighted-average shares: | ||||
Basic (in shares) | 57,710,251 | 34,989,831 | 57,356,445 | 33,505,444 |
Effect of dilutive securities: | ||||
Warrants (in shares) | 6,834,253 | 0 | 8,498,458 | 0 |
Diluted (in shares) | 64,544,504 | 34,989,831 | 65,854,903 | 33,505,444 |
Net income (loss) per share: | ||||
Basic (in usd per share) | $ 0.19 | $ (0.22) | $ 0.06 | $ (0.92) |
Diluted (in usd per share) | $ (0.10) | $ (0.22) | $ (0.27) | $ (0.92) |
Net Income (Loss) Per Share - A
Net Income (Loss) Per Share - Additional Information (Details) - shares shares in Millions | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share (in shares) | 33.2 | 31.6 | |
Stock Option | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share (in shares) | 4.8 | 4.8 | 3.3 |
Restricted Stock | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share (in shares) | 1 | 1 | 0.7 |
Warrant | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share (in shares) | 27.4 | 25.8 | 36.7 |