Document and Entity Information
Document and Entity Information - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Mar. 04, 2016 | Jun. 30, 2015 | |
Document And Entity Information [Abstract] | |||
Entity Registrant Name | Flex Pharma, Inc. | ||
Entity Central Index Key | 1,615,219 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Non-accelerated Filer | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2015 | ||
Document Fiscal Year Focus | 2,015 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Entity Common Stock, Shares Outstanding | 17,954,774 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Public Float | $ 185.9 |
CONSOLIDATED BALANCE SHEET
CONSOLIDATED BALANCE SHEET - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
Current assets: | ||
Cash and cash equivalents | $ 66,686,695 | $ 33,854,153 |
Marketable securities | 24,652,348 | 0 |
Prepaid expenses and other current assets | 908,574 | 370,396 |
Total current assets | 92,247,617 | 34,224,549 |
Marketable securities | 2,312,949 | 0 |
Property and equipment, net | 382,437 | 85,144 |
Deferred IPO issuance costs | 0 | 1,074,794 |
Deferred tax assets | 0 | 50,103 |
Other assets | 0 | 50,000 |
Restricted cash | 126,835 | 126,808 |
Total assets | 95,069,838 | 35,611,398 |
Current liabilities: | ||
Accounts payable | 875,646 | 578,653 |
Accrued expenses and other current liabilities | 1,947,374 | 416,524 |
Deferred tax liabilities | 0 | 50,103 |
Deferred rent, current portion | 24,381 | 21,881 |
Total current liabilities | 2,847,401 | 1,067,161 |
Deferred rent, net of current portion | 14,587 | 35,968 |
Other long term liabilities | 15,442 | 15,442 |
Total liabilities | $ 2,877,430 | $ 1,118,571 |
Commitments and contingencies (Note 8) | ||
Convertible preferred stock: | ||
Preferred stock, carrying value | $ 0 | $ 0 |
Stockholders' equity (deficit): | ||
Common stock, $0.0001 par value; 100,000,000 and 61,000,000 shares authorized at December 31, 2015 and December 31, 2014, respectively, 17,943,880 and 5,434,301 shares issued at December 31, 2015 and December 31, 2014, respectively, and 15,741,618 and 2,215,711 shares outstanding at December 31, 2015 and December 31, 2014, respectively | 1,574 | 221 |
Additional paid-in capital | 129,367,978 | 1,472,299 |
Accumulated other comprehensive loss | (24,654) | 0 |
Accumulated deficit | (37,152,490) | (8,010,860) |
Total stockholders' equity (deficit) | 92,192,408 | (6,538,340) |
Total liabilities, convertible preferred stock and stockholders' equity (deficit) | 95,069,838 | 35,611,398 |
Series A convertible preferred stock | ||
Convertible preferred stock: | ||
Preferred stock, carrying value | 0 | 15,637,032 |
Series B Preferred Stock | ||
Convertible preferred stock: | ||
Preferred stock, carrying value | $ 0 | $ 25,394,135 |
CONSOLIDATED BALANCE SHEET (PAR
CONSOLIDATED BALANCE SHEET (PARENTHETICAL) - $ / shares | Dec. 31, 2015 | Dec. 31, 2014 |
Preferred stock, par value (in usd per share) | $ 0.0001 | |
Preferred stock, authorized (shares) | 10,000,000 | 0 |
Preferred stock, issued (shares) | 0 | 0 |
Preferred stock, shares outstanding (shares) | 0 | 0 |
Common stock, par value (in usd per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (shares) | 100,000,000 | 61,000,000 |
Common stock, shares issued (shares) | 17,943,880 | 5,434,301 |
Common stock, shares outstanding (shares) | 15,741,618 | 2,215,711 |
Series A Preferred Stock | ||
Preferred stock, par value (in usd per share) | $ 0.0001 | |
Preferred stock, authorized (shares) | 0 | 16,000,000 |
Preferred stock, issued (shares) | 0 | 15,775,221 |
Preferred stock, shares outstanding (shares) | 0 | 15,775,221 |
Series B Preferred Stock | ||
Preferred stock, par value (in usd per share) | $ 0.0001 | |
Preferred stock, authorized (shares) | 0 | 14,500,000 |
Preferred stock, issued (shares) | 0 | 14,078,647 |
Preferred stock, shares outstanding (shares) | 0 | 14,078,647 |
CONSOLIDATED STATEMENT OF OPERA
CONSOLIDATED STATEMENT OF OPERATIONS - USD ($) | 10 Months Ended | 12 Months Ended |
Dec. 31, 2014 | Dec. 31, 2015 | |
Operating expenses: | ||
Research and development | $ 4,003,911 | $ 12,749,379 |
Selling, general and administrative | 4,025,895 | 16,464,279 |
Total operating expenses | 8,029,806 | 29,213,658 |
Loss from operations | (8,029,806) | (29,213,658) |
Interest income, net | 18,946 | 72,028 |
Net loss | (8,010,860) | (29,141,630) |
Net loss attributable to common stockholders | $ (8,010,860) | $ (29,141,630) |
Net loss per share attributable to common stockholders - basic and diluted (in usd per share) | $ (4.57) | $ (2.08) |
Weighted-average number of common shares outstanding — basic and diluted | 1,753,024 | 14,032,916 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) | 10 Months Ended | 12 Months Ended |
Dec. 31, 2014 | Dec. 31, 2015 | |
Statement of Comprehensive Income [Abstract] | ||
Net loss | $ (8,010,860) | $ (29,141,630) |
Other Comprehensive loss: | ||
Unrealized loss on available-for sale securities | 0 | (24,654) |
Comprehensive loss | $ (8,010,860) | $ (29,166,284) |
CONSOLIDATED STATEMENT OF CONVE
CONSOLIDATED STATEMENT OF CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY (DEFICIT) - USD ($) | Total | Preferred Stock | Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Loss | Accumulated Deficit | Series A Preferred Stock | Series A Preferred StockPreferred Stock | Series A Preferred StockCommon Stock | Series A Preferred StockAdditional Paid-In Capital | Series B Preferred Stock | Series B Preferred StockPreferred Stock | Series B Preferred StockCommon Stock | Series B Preferred StockAdditional Paid-In Capital |
Preferred stock, shares outstanding, beginning balance at Feb. 26, 2014 | 0 | 0 | 0 | |||||||||||
Common stock, shares outstanding, beginning balance at Feb. 26, 2014 | 0 | |||||||||||||
Equity, beginning balance at Feb. 26, 2014 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Issuance of stock/IPO proceeds, net of issuance costs (in shares) | 15,775,221 | 14,078,647 | ||||||||||||
Issuance of stock/IPO proceeds, net of issuance costs | $ 15,637,032 | $ 25,394,135 | ||||||||||||
Sale of restricted common stock to founders | 2,321 | 2,321 | ||||||||||||
Vesting of restricted common stock (in shares) | 2,202,139 | |||||||||||||
Vesting of restricted common stock | 0 | $ 220 | (220) | |||||||||||
Issuance of common stock from option exercises (in shares) | 13,572 | |||||||||||||
Issuance of common stock from option exercises | 8,138 | $ 1 | 8,137 | |||||||||||
Stock-based compensation expense | 1,462,061 | 1,462,061 | ||||||||||||
Net loss | $ (8,010,860) | (8,010,860) | ||||||||||||
Preferred stock, shares outstanding, ending balance at Dec. 31, 2014 | 0 | 0 | 15,775,221 | 15,775,221 | 14,078,647 | 14,078,647 | ||||||||
Common stock, shares outstanding, ending balance at Dec. 31, 2014 | 2,215,711 | 2,215,711 | ||||||||||||
Equity, ending balance at Dec. 31, 2014 | $ (6,538,340) | $ 0 | $ 221 | 1,472,299 | 0 | (8,010,860) | $ 15,637,032 | $ 25,394,135 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Issuance of stock/IPO proceeds, net of issuance costs (in shares) | 5,491,191 | 15,775,221 | 3,683,637 | 14,078,647 | 3,287,471 | |||||||||
Issuance of stock/IPO proceeds, net of issuance costs | 79,860,185 | $ 549 | 79,859,636 | $ 15,637,032 | $ (15,637,032) | $ 368 | $ 15,636,664 | $ 25,394,135 | $ (25,394,135) | $ 329 | $ 25,393,806 | |||
Vesting of restricted common stock (in shares) | 1,016,328 | |||||||||||||
Vesting of restricted common stock | $ 0 | $ 102 | (102) | |||||||||||
Issuance of common stock from option exercises (in shares) | 47,280 | 47,280 | ||||||||||||
Issuance of common stock from option exercises | $ 408,321 | $ 5 | 408,316 | |||||||||||
Stock-based compensation expense | 6,597,359 | 6,597,359 | ||||||||||||
Unrealized loss on available-for-sale securities | (24,654) | (24,654) | ||||||||||||
Net loss | $ (29,141,630) | (29,141,630) | ||||||||||||
Preferred stock, shares outstanding, ending balance at Dec. 31, 2015 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||
Common stock, shares outstanding, ending balance at Dec. 31, 2015 | 15,741,618 | 15,741,618 | ||||||||||||
Equity, ending balance at Dec. 31, 2015 | $ 92,192,408 | $ 0 | $ 1,574 | $ 129,367,978 | $ (24,654) | $ (37,152,490) | $ 0 | $ 0 |
CONSOLIDATED STATEMENT OF CONV7
CONSOLIDATED STATEMENT OF CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY (DEFICIT) (PARENTHETICAL) - USD ($) | 10 Months Ended | 12 Months Ended |
Dec. 31, 2014 | Dec. 31, 2015 | |
Issuance costs | $ 1,848,737 | |
Series A Preferred Stock | ||
Issuance costs | $ 138,189 | |
Series B Preferred Stock | ||
Issuance costs | $ 55,835 |
CONSOLIDATED STATEMENT OF CASH
CONSOLIDATED STATEMENT OF CASH FLOWS - USD ($) | 10 Months Ended | 12 Months Ended |
Dec. 31, 2014 | Dec. 31, 2015 | |
Operating activities | ||
Net loss | $ (8,010,860) | $ (29,141,630) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation expense | 11,997 | 49,881 |
Stock-based compensation expense | 1,462,061 | 6,597,359 |
Amortization of premium on investments | 0 | 9,523 |
Other non-cash items | 55,221 | 4,123 |
Changes in operating assets and liabilities: | ||
Restricted cash | (126,808) | (27) |
Prepaid expenses and other current assets | (370,396) | (538,178) |
Other assets | (50,000) | 100,103 |
Accounts payable | 254,253 | 621,393 |
Accrued expenses and other current liabilities | 220,375 | 1,570,216 |
Deferred rent | 57,849 | (18,881) |
Other long term liabilities | 15,442 | 0 |
Net cash used in operating activities | (6,480,866) | (20,746,118) |
Investing activities | ||
Purchases of marketable securities | 0 | (39,397,769) |
Proceeds from maturities and sales of marketable securities | 0 | 12,398,295 |
Purchases of property and equipment | (76,141) | (265,617) |
Net cash used in investing activities | (76,141) | (27,265,091) |
Financing activities | ||
Proceeds from initial public offering, net of offering costs | 0 | 80,435,430 |
Proceeds from sale of restricted common stock to founders | 2,321 | 0 |
Proceeds from exercise of common stock | 8,138 | 408,321 |
Deferred IPO issuance costs | (575,245) | 0 |
Net cash provided by financing activities | 40,411,160 | 80,843,751 |
Net increase in cash and cash equivalents | 33,854,153 | 32,832,542 |
Cash and cash equivalents at beginning of period | 33,854,153 | |
Cash and cash equivalents at end of period | 33,854,153 | 66,686,695 |
Supplemental cash flow information | ||
Issuance of Series A convertible preferred stock in satisfaction of accounts payable | 55,221 | 0 |
Deferred IPO issuance costs in accounts payable and accrued expenses | 499,549 | 0 |
Property and equipment purchases in accrued expenses | 21,000 | 106,680 |
IPO issuance costs paid in cash through December 31, 2014 | 0 | 575,245 |
Series A Preferred Stock | ||
Financing activities | ||
Proceeds from issuance of convertible preferred stock, net of issuance costs | 15,581,811 | 0 |
Series B Preferred Stock | ||
Financing activities | ||
Proceeds from issuance of convertible preferred stock, net of issuance costs | $ 25,394,135 | $ 0 |
Organization and operations
Organization and operations | 12 Months Ended |
Dec. 31, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and operations | Organization and operations The Company Flex Pharma, Inc. (the "Company") is a biotechnology company that was incorporated in Delaware on February 26, 2014 and has a principal place of business in Boston, Massachusetts. The Company is developing innovative and proprietary treatments for nocturnal leg cramps, muscle cramps, spasms and spasticity associated with severe neuromuscular conditions, and exercise-associated muscle cramps. The Company's product candidates are based on the mechanism of action described as Chemical Neuro Stimulation, which is the process by which a small molecule chemical signal, acting topically, is translated into a neuronal sensory signal that produces a beneficial effect. The Company's product candidates activate certain receptors in primary sensory neurons, which then act via neuronal circuits to reduce the repetitive firing, or hyperexcitability, of alpha-motor neurons in the spinal cord, thereby preventing or reducing the frequency and intensity of muscle cramps and spasms. The Company believes that it is the only company developing both drug and consumer products based on this mechanism of muscle cramp inhibition. The Company is subject to risks common to companies in the biotechnology industry, including, but not limited to, risks of failure of pre-clinical studies, clinical studies and clinical trials, the need to obtain marketing approval for its drug product candidates, the need to successfully commercialize and gain market acceptance of its drug product candidates and its consumer products, dependence on key personnel, protection of proprietary technology, compliance with government regulations, development by competitors of technological innovations and ability to transition from pilot-scale manufacturing to large-scale production of products. Liquidity The Company has incurred an accumulated deficit of $37,152,490 from February 26, 2014 (inception) through December 31, 2015, and will require substantial additional capital to fund its research and development and the launch of its consumer brand and cornerstone product. The Company had cash, cash equivalents and marketable securities of $93,651,992 at December 31, 2015 . The Company believes that its existing cash, cash equivalents and marketable securities will be sufficient to allow the Company to fund its current operating plan for at least the next 12 months. Management expects the Company to incur a loss for the foreseeable future. The Company's ability to achieve profitability in the future is dependent upon the successful development, approval and commercialization of its drug product candidates and successful commercialization of its consumer product and future consumer products, and achieving a level of revenues adequate to support the Company's cost structure. The Company may never achieve profitability, and unless and until it does, the Company will continue to need to raise additional capital. Management intends to fund future operations through additional private or public debt or equity offerings, and may seek additional capital through arrangements with collaborators or from other sources. There can be no assurances, however, that additional funding will be available on terms acceptable to the Company, or at all. |
Summary of significant accounti
Summary of significant accounting policies | 12 Months Ended |
Dec. 31, 2015 | |
Accounting Policies [Abstract] | |
Summary of significant accounting policies | Summary of significant accounting policies Basis of presentation and use of estimates The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America ("GAAP"). Any reference in these notes to applicable guidance is meant to refer to the authoritative United States generally accepted accounting principles as found in the Accounting Standards Codification ("ASC") and Accounting Standards Update ("ASU") of the Financial Accounting Standards Board ("FASB"). The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. On an ongoing basis, the Company's management evaluates its estimates, which include, but are not limited to, estimates related to clinical study accruals, stock-based compensation expense, and amounts of expenses during the reported period. The Company bases its estimates on historical experience and other market-specific or other relevant assumptions that it believes to be reasonable under the circumstances. Actual results may differ from those estimates or assumptions. Prior to the Company's initial public offering ("IPO"), the Company utilized significant estimates and assumptions in determining the fair value of its common stock. The Company utilized various valuation methodologies in accordance with the framework of the 2004 and 2013 American Institute of Certified Public Accountants Technical Practice Aids, Valuation of Privately-Held Company Equity Securities Issued as Compensation , to estimate the fair value of its common stock. Each valuation methodology included estimates and assumptions that required the Company's judgment. These estimates and assumptions included a number of objective and subjective factors, including external market conditions affecting the biotechnology industry sector, the prices at which the Company sold shares of preferred stock, the superior rights and preferences of securities senior to the Company's common stock at the time and the likelihood of achieving a liquidity event, such as an initial public offering or a sale of the Company. Significant changes to the key assumptions used in the valuations could have resulted in different fair values of common stock at each valuation date and may have materially affected the financial statements. Principles of consolidation The consolidated financial statements include the accounts of the Company and its wholly owned subsidiary, TK Pharma, Inc., a Massachusetts Securities Corporation. All significant intercompany balances and transactions have been eliminated in consolidation. Segment information Operating segments are defined as components of an enterprise about which separate discrete information is available for evaluation by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and assess performance. The Company and the Company's chief operating decision maker, the Company's Chief Executive Officer, view the Company's operations and manage its business as one operating segment, which is the business of developing and commercializing products for nocturnal leg cramps, muscle cramps, spasms and spasticity associated with severe neuromuscular conditions, and exercise-associated muscle cramps. The Company operates in only one geographic segment, the United States. Concentrations of credit risk and off-balance sheet risk Cash, cash equivalents and marketable securities are financial instruments that potentially subject the Company to concentrations of credit risk. The Company's cash, cash equivalents and marketable securities are held in accounts at financial institutions that management believes are creditworthy. The Company has not experienced any credit losses in such accounts and does not believe it is exposed to any significant credit risk on these funds. The Company has no financial instruments with off-balance sheet risk of loss. Property and equipment Property and equipment is stated at cost, less accumulated depreciation. Maintenance and repairs that do not improve or extend the lives of the respective assets are expensed to operations as incurred, while costs of major additions and betterments are capitalized. Upon disposal, the related cost and accumulated depreciation is removed from the accounts and any resulting gain or loss is included in the results of operations. Depreciation is recorded, once assets are placed in service, using the straight-line method over the estimated useful lives of the respective assets, which are as follows: Asset type Estimated useful life Computers and computer equipment 3 years Laboratory equipment 3 years Manufacturing equipment 3 years Impairment of long-lived assets The Company evaluates long-lived assets for potential impairment when events or changes in circumstances indicate the carrying value of the assets may not be recoverable. Recoverability is measured by comparing the book values of the assets to the expected future net undiscounted cash flows that the assets are expected to generate. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the book value of the assets exceed their fair value. The Company has not recognized any impairment losses through December 31, 2015 . Research and development expense Research and development costs are charged to expense as incurred in performing research and development activities. The costs include employee compensation costs, clinical study costs, external consultant costs, regulatory costs and facilities and overhead costs. Facilities and overhead costs primarily include the allocation of insurance, rent, utility and office-related expenses attributable to research and development personnel. The Company records payments made to outside vendors in advance of services performed or goods being delivered for use in research and development activities as prepaid expenses, which are expensed as services are performed or goods are delivered. Stock-based compensation expense The Company accounts for its stock-based compensation awards to employees and directors in accordance with FASB ASC Topic 718, Compensation-Stock Compensation ("ASC 718"). ASC 718 requires all stock-based payments to employees, including grants of employee stock options, to be recognized in the statement of operations based on their grant date fair values. Compensation expense related to awards to employees with service conditions is recognized on a straight-line basis based on the grant date fair value over the associated service period of the award, which is generally the vesting term. Compensation expense related to awards to employees with performance conditions is recognized based on grant date fair value over the remaining service period when management determines that achievement of the milestone is probable. Management evaluates when the achievement of a performance-based milestone is probable based on the relative satisfaction of the performance conditions as of the reporting date. The Company accounts for stock-based compensation arrangements with non-employees based upon the fair value of the consideration received or the equity instruments issued, whichever is more reliably measurable, in accordance with the provisions of FASB ASC Topic 505-50, Equity-Based Payments to Non-Employees . The measurement date for non-employee awards is generally the date performance of services required from the non-employee is complete, resulting in periodic adjustments to stock-based compensation expense during the vesting period for changes in the fair value of the awards. Stock-based compensation costs for non-employee service awards are recognized as services are provided, which is generally the vesting period, on a straight-line basis. The unvested portion of the awards is subject to re-measurement over the vesting period. The Company estimates the fair value of its stock options using the Black-Scholes option pricing model, which requires the input of subjective assumptions, including (a) the expected stock price volatility, (b) the expected term of the award, (c) the risk-free interest rate, (d) expected dividends and (e) the estimated fair value of the Company's common stock on the measurement date. Due to the lack of significant trading history for the Company's common stock, it has based its estimate of expected volatility on the historical volatility of a group of similar companies that are publicly traded. When selecting these public companies on which it has based its expected stock price volatility, the Company selected companies with comparable characteristics, including enterprise value, risk profiles, position within the industry, and with historical share price information sufficient to meet the expected term of the stock-based awards. The Company computes historical volatility data using the volatility for the selected companies' shares during the equivalent period of the calculated expected term of the stock-based awards. The Company will continue to apply this process until a sufficient amount of historical information regarding the volatility of its own stock price becomes available. Due to the lack of Company specific historical option activity, the Company has estimated the expected term of its employee stock options using the "simplified" method, whereby, the expected term equals the arithmetic average of the vesting term and the original contractual term of the option. The expected term for non-employee awards is the remaining contractual term of the option. The risk-free interest rates are based on the U.S. Treasury securities with a maturity date commensurate with the expected term of the associated award. The Company has never paid, and does not expect to pay dividends in the foreseeable future. The Company is also required to estimate forfeitures at the time of grant and revise those estimates in subsequent periods if actual forfeitures differ from its estimates. The Company records stock-based compensation expense only for those awards that are expected to vest. To the extent that actual forfeitures differ from the Company's estimates, the differences are recorded as a cumulative adjustment in the period the estimates were revised. Income taxes Income taxes are recorded in accordance with FASB ASC Topic 740, Income Taxes ("ASC 740"), which provides for deferred taxes using an asset and liability approach. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial reporting and the tax reporting basis of assets and liabilities and are measured using the enacted tax rates and laws that are expected to be in effect when the differences are expected to reverse. The Company provides a valuation allowance against net deferred tax assets unless, based upon the available evidence, it is more likely than not that the deferred tax assets will be realized. The Company has evaluated available evidence and concluded that the Company may not realize the benefit of its deferred tax assets; therefore a valuation allowance has been established for the full amount of the deferred tax assets. The Company accounts for uncertain tax positions in accordance with the provisions of ASC 740. When uncertain tax positions exist, the Company recognizes the tax benefit of tax positions to the extent that the benefit will more likely than not be realized. The determination as to whether the tax benefit will more likely than not be realized is based upon the technical merits of the tax position as well as consideration of the available facts and circumstances. As of December 31, 2015 and December 31, 2014, the Company did not have any significant uncertain tax positions. The Company's practice is to recognize interest and/or penalties related to income tax matters in income tax expense. Net loss per share attributable to common stockholders Basic net loss per share is computed by dividing the net loss attributable to common stockholders by the weighted-average number of common shares outstanding for the period. Diluted net loss per share is computed by dividing the net loss attributable to common stockholders by the weighted-average number of common shares and dilutive common stock equivalents outstanding for the period, determined using the treasury stock method and the if-converted method, for convertible securities, if inclusion of these is dilutive. For year ended December 31, 2015 and the period from February 26, 2014 (inception) December 31, 2014, the Company has excluded the effects of all potentially dilutive shares from the weighted-average number of common shares outstanding as their inclusion in the computation for each period would be anti-dilutive due to the net loss per share incurred by the Company. Comprehensive loss Comprehensive loss is the change in equity of a company during a period from transactions and other events and circumstances, excluding transactions resulting from investments by owners and distributions to owners. Comprehensive loss includes net loss and the change in accumulated other comprehensive loss for the period. Accumulated other comprehensive loss consisted entirely of unrealized gains and losses on available-for-sale marketable securities for the year ended December 31, 2015. The Company's net loss equaled comprehensive loss for the period from February 26, 2014 to December 31, 2014. See the consolidated statements of comprehensive loss for relevant disclosures. The following tables summarize the changes in accumulated other comprehensive loss during the year ended December 31, 2015. There was no accumulated other comprehensive loss for the period from February 26, 2014 to December 31, 2014: Balance as of December 31, 2014 $ — Other comprehensive loss (24,654 ) Balance as of December 31, 2015 $ (24,654 ) Recent accounting pronouncements In July 2015, the FASB issued ASU No. 2015-11, Inventory (Topic 330) . This ASU simplifies the measurement of inventory by requiring certain inventory to be measured at the lower of cost or net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. The amendments in this ASU are effective for fiscal years beginning after December 15, 2016 and for interim periods therein. Subsequent measurement is unchanged for inventory measured using LIFO or the retail inventory method. The Company is currently in the process of evaluating the impact of the guidance related to the Company's anticipated launch of its consumer product in the second quarter of 2016. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) . The ASU provides for a single comprehensive model for use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance. The accounting standard is effective for interim and annual periods beginning after December 15, 2016 with no early adoption permitted. In July 2015, the FASB deferred the effective date of this accounting update to annual periods beginning after December 15, 2017, along with an option to permit early adoption as of the original effective date. The Company is required to adopt the amendments in the ASU using one of two acceptable methods: retrospectively to all prior reporting periods presented, with certain practical expedients permitted; or retrospectively with the cumulative effect of initially adopting the ASU recognized at the date of initial application. The Company is currently in the process of evaluating the impact of the guidance related to the Company's anticipated launch of its consumer product in the second quarter of 2016. In August 2014, the FASB issued ASU No. 2014-15 Presentation of Financial Statements - Going Concern (Subtopic 205-40) . The ASU requires management of public and private companies to evaluate whether there is substantial doubt about the entity’s ability to continue as a going concern within one year after the date that the financial statements are issued. Management’s evaluation should be based on relevant conditions and events that are known and reasonably knowable at the date that the financial statements are issued. If conditions or events raise substantial doubt about an entity’s ability to continue as a going concern, and substantial doubt is not alleviated after consideration of management’s plans, an entity should include a statement in the footnotes indicating that there is substantial doubt about the entity’s ability to continue as a going concern within one year after the date that the financial statements are issued. The new standard is effective for annual periods ending after December 15, 2016, and for annual periods and interim periods thereafter. Early application is permitted. The Company has concluded, that if this standard had been adopted as of December 31, 2015, substantial doubt about the Company’s ability to continue as a going concern does not exist. In February 2015, the FASB issued ASU No. 2015-02 Consolidation (Topic 810): Amendments to the Consolidation Analysis. ASU 2015-02 changes the analysis that a reporting entity must perform to determine whether it should consolidate certain types of legal entities. It is effective for annual reporting periods, and interim periods within those years, beginning after December 15, 2015. Early adoption is permitted, including adoption in an interim period. The accounting standard is not expected to have a material impact on the Company's consolidated financial statements. In November 2015, the FASB issued ASU No. 2015-17 Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes . ASU 2015-17 simplifies the presentation of deferred income taxes by eliminating the separate classification of deferred income tax liabilities and assets into current and noncurrent amounts in the consolidated balance sheet. The amendments in the update require that all deferred tax liabilities and assets be classified as noncurrent in the consolidated balance sheet. The amendments in this update are effective for annual periods beginning after December 15, 2016, and interim periods therein and may be applied either prospectively or retrospectively to all periods presented. Early adoption is permitted. The Company early adopted this standard in the fourth quarter of 2015 on a prospective basis and did not retrospectively adjust the prior period. As a result, all of the Company’s deferred taxes are presented as long-term in the consolidated financial statements as of December 31, 2015. The Company did not reclassify current deferred tax assets and liabilities on the consolidated balance sheet as of December 31, 2014. Adoption did not have a material impact on the consolidated financial statements. In February 2016, the FASB issued ASU No. 2016-02 Leases . The ASU requires lessees to recognize the assets and liabilities on their balance sheet for the rights and obligations created by most leases and continue to recognize expenses on their income statements over the lease term. It will also require disclosures designed to give financial statement users information on the amount, timing, and uncertainty of cash flows arising from leases. The guidance is effective for annual reporting periods beginning after December 15, 2018, and interim periods within those years. Early adoption is permitted for all entities. The Company is currently evaluating the impact of ASU 2016-02 on its consolidated financial statements and disclosures. Initial public offering On February 3, 2015, the Company completed its IPO, whereby the Company sold 5,491,191 shares of its common stock (inclusive of 91,191 shares of common stock sold by the Company pursuant to the exercise of an overallotment option granted to the underwriters in connection with the IPO) at a price of $16.00 per share. The shares began trading on the Nasdaq Global Market on January 29, 2015. The aggregate net proceeds received by the Company from the IPO were approximately $79,900,000 , after deducting underwriting discounts and commissions and other offering expenses payable by the Company. Upon the closing of the IPO, all outstanding shares of convertible preferred stock converted into 6,971,108 shares of common stock. Additionally, the Company is now authorized to issue 100,000,000 shares of common stock. Deferred IPO issuance costs, which primarily consisted of direct incremental legal and accounting fees related to the Company's IPO, were capitalized at December 31, 2014. Upon the closing of the IPO in February 2015, IPO issuance costs of $1,848,737 , as well as underwriting discounts and commissions of $6,150,134 , were offset against the IPO proceeds within additional paid-in capital. Reverse stock split In January 2015, the Company effected a one-for- 4.2825 reverse stock split of its then issued and outstanding common stock. All share and per share amounts related to issued and outstanding common stock and outstanding options exercisable for common stock included in the Company's consolidated financial statements and notes to consolidated financial statements have been retroactively adjusted for all periods presented to reflect the reverse stock split, including reclassifying an amount equal to the reduction in par value of common stock to additional paid-in capital. The conversion ratios of the Company's convertible preferred stock have also been adjusted to reflect the reverse stock split. Subsequent events The Company considers events or transactions that occur after the balance sheet date but prior to the issuance of the consolidated financial statements for potential recognition or disclosure in the consolidated financial statements. Subsequent events have been evaluated through the date these consolidated financial statements were issued for potential recognition or disclosure in the consolidated financial statements (Note 16). |
Restricted cash
Restricted cash | 12 Months Ended |
Dec. 31, 2015 | |
Cash and Cash Equivalents [Abstract] | |
Restricted cash | Restricted cash As of December 31, 2015 and December 31, 2014, the Company had $126,835 and $126,808 of restricted cash, respectively, in the form of a letter of credit. The Company maintains this letter of credit as a security deposit on the lease of its office space in Boston, Massachusetts (Note 8). |
Fair value measurements
Fair value measurements | 12 Months Ended |
Dec. 31, 2015 | |
Fair Value Disclosures [Abstract] | |
Fair value measurements | Fair value measurements The Company records cash equivalents and marketable securities at fair value. ASC Topic 820 Fair Value Measurements and Disclosures established a fair value hierarchy for those instruments measured at fair value that distinguishes between assumptions based on market data (observable inputs) and the Company’s own assumptions (unobservable inputs). The hierarchy consists of three levels: Level 1 – Unadjusted quoted prices in active markets for identical assets or liabilities. Level 2 – Quoted prices for similar assets and liabilities in active markets, quoted prices in markets that are not active, or inputs which are observable, directly or indirectly, for substantially the full term of the asset or liability. Level 3 – Unobservable inputs that reflect the Company’s own assumptions about the assumptions market participants would use in pricing the asset or liability in which there is little, if any, market activity for the asset or liability at the measurement date. The following table summarizes the cash equivalents and marketable securities measured at fair value on a recurring basis as of December 31, 2015: Level 1 Level 2 Level 3 Total Cash equivalents $ 58,575,348 $ 1,410,322 $ — $ 59,985,670 Marketable securities: — Corporate debt securities — 26,965,297 — 26,965,297 $ 58,575,348 $ 28,375,619 $ — $ 86,950,967 The Company did not hold any cash equivalents or marketable securities at December 31, 2014. Cash equivalents and marketable securities have been initially valued at the transaction price and subsequently valued, at the end of each reporting period, utilizing third-party pricing services or other market observable data. The pricing services utilize industry standard valuation models, including both income and market based approaches and observable market inputs to determine value. The majority of the Company's cash equivalents consist of money market funds that are valued based on publicly available quoted market prices for identical securities as of December 31, 2015. A portion of the Company's current cash equivalents consist of money market funds that are not listed in active markets, and were validated using quoted prices for similar assets in active markets. After completing its validation procedures, the Company did not adjust or override any fair value carrying amounts of as of December 31, 2015. The carrying amounts reflected in the consolidated balance sheets for cash, prepaid expenses and other current assets, accounts payable, accrued expenses and other current liabilities approximate their fair values at December 31, 2015 and 2014, due to their short-term nature. The Company evaluates transfers between levels at the end of each reporting period. There were no transfers of assets or liabilities between Level 1 and Level 2 during the year ended December 31, 2015. The Company had no financial assets or liabilities that were classified as Level 3 at any point during the year ended December 31, 2015. |
Cash equivalents and marketable
Cash equivalents and marketable securities | 12 Months Ended |
Dec. 31, 2015 | |
Cash and Cash Equivalents [Abstract] | |
Cash equivalents and marketable securities | Cash equivalents and marketable securities The Company considers all highly liquid investments with maturities of three months or less when purchased to be cash equivalents. Cash equivalents as of December 31, 2015 consisted of money market funds. The Company did not have cash equivalents as of December 31, 2014. Marketable securities as of December 31, 2015 consisted of corporate debt securities. The Company did not hold any marketable securities as of December 31, 2014. Management determines the appropriate classification of the securities at the time they are acquired and evaluates the appropriateness of such classifications at each balance sheet date. The Company classifies its marketable securities as available-for-sale pursuant to ASC 320 Investments – Debt and Equity Securities . Marketable securities are recorded at fair value, with unrealized gains and losses included as a component of accumulated other comprehensive income (loss) in stockholders’ equity and a component of total comprehensive income (loss) in the condensed consolidated statement of comprehensive income (loss), until realized. Realized gains and losses are included in investment income on a specific-identification basis. There were immaterial realized gains on marketable securities during the year ended December 31, 2015, and no realized gains or losses during the period from February 26, 2014 (inception) to December 31, 2014. The Company reviews marketable securities for other-than-temporary impairment whenever the fair value of a marketable security is less than the amortized cost and evidence indicates that a marketable security’s carrying amount is not recoverable within a reasonable period of time. Other-than-temporary impairments of investments are recognized in the consolidated statement of operations if the Company has experienced a credit loss, has the intent to sell the marketable security, or if it is more likely than not that the Company will be required to sell the marketable security before recovery of the amortized cost basis. Evidence considered in this assessment includes reasons for the impairment, compliance with the Company’s investment policy, the severity and the duration of the impairment and changes in value subsequent to the end of the period. Marketable securities at December 31, 2015 consisted of the following: Amortized Cost Unrealized Gains Unrealized Losses Fair Value Current (due within 1 year): Corporate debt securities $ 24,666,607 $ 1,878 $ (16,137 ) $ 24,652,348 Noncurrent (due after 1 year through 5 years): Corporate debt securities 2,323,344 — (10,395 ) 2,312,949 Total $ 26,989,951 $ 1,878 $ (26,532 ) $ 26,965,297 At December 31, 2015, the Company had $24,652,348 of marketable securities classified as current and $2,312,949 of marketable securities classified as noncurrent. The Company did not hold any investments as of December 31, 2014. Investments classified as current have maturities of less than one year. Investments classified as noncurrent are those that (i) have a maturity greater than one year and (ii) management does not intend to liquidate within the next year, although these funds are available for use and therefore classified as available-for-sale. At December 31, 2015 , the Company held eleven debt securities that were in an unrealized loss position, all of which have been in a continuous loss position for less than 12 months. The aggregate fair value of debt securities in an unrealized loss position at December 31, 2015 was $24,967,915 . There were no individual securities that were in a significant unrealized loss position as of December 31, 2015 . The Company evaluated its securities for other-than-temporary impairment and considered the decline in market value for the securities to be primarily attributable to current economic and market conditions. The Company has the intent and ability to hold such securities until recovery. Based on this analysis, these marketable securities were not considered to be other-than-temporarily impaired as of December 31, 2015 . |
Property and equipment, net
Property and equipment, net | 12 Months Ended |
Dec. 31, 2015 | |
Property, Plant and Equipment [Abstract] | |
Property and equipment, net | Property and equipment, net Property and equipment, net consists of the following: December 31, 2015 December 31, 2014 Computers and computer equipment $ 177,240 $ 62,773 Laboratory equipment 13,368 13,368 Capital in progress 251,893 21,000 Total property and equipment 442,501 97,141 Accumulated depreciation (60,064 ) (11,997 ) Property and equipment, net $ 382,437 $ 85,144 Capital in progress consists of assets acquired but not yet placed into service. At December 31, 2015, capital in progress consisted primarily of manufacturing equipment. Depreciation expense was $49,881 for the twelve months ended December 31, 2015 and 11,997 for the period from February 26, 2014 (inception) to December 31, 2014. |
Accrued expenses and other curr
Accrued expenses and other current liabilities | 12 Months Ended |
Dec. 31, 2015 | |
Payables and Accruals [Abstract] | |
Accrued expenses and other current liabilities | Accrued expenses and other current liabilities Accrued expenses and other current liabilities consist of the following: December 31, 2015 December 31, 2014 Payroll and employee-related costs $ 1,299,248 $ 34,218 Research and development costs 307,666 125,067 Consumer product-related costs 198,887 23,635 Professional fees 129,625 15,500 Other 11,948 42,955 Deferred IPO issuance costs — 175,149 Total $ 1,947,374 $ 416,524 |
Commitments and contingencies
Commitments and contingencies | 12 Months Ended |
Dec. 31, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and contingencies | Commitments and contingencies Lease commitments On April 29, 2014, the Company leased office space in Boston, Massachusetts under an operating lease that is scheduled to expire on August 31, 2017. Additionally, on October 21, 2014, the Company leased office space in New York, New York under an operating lease that was scheduled to expire on October 31, 2016. The lease was amended in January 2016 (see Note 16). As of December 31, 2015 , the minimum future lease payments under the Company's operating leases were as follows: 2016 $ 323,190 2017 168,793 Total minimum lease payments $ 491,983 Rent expense is being recognized on a straight-line basis. The Company recorded approximately $253,000 of rent expense for the twelve months ended December 31, 2015 and $152,000 of rent expense for the period from February 26, 2014 (inception) to December 31, 2014. Royalty agreement In March 2014, the Company entered into a royalty agreement with certain of its founders. Under the agreement, the Company agreed to pay the founders an aggregate royalty of 2% of gross sales of the Company's products in perpetuity. No royalty amounts were owed to the founders as of December 31, 2015 or 2014. Litigation The Company is not a party to any litigation and does not have contingency reserves established for any litigation liabilities as of December 31, 2015 . |
Convertible preferred stock
Convertible preferred stock | 12 Months Ended |
Dec. 31, 2015 | |
Equity [Abstract] | |
Convertible preferred stock | Convertible preferred stock As of December 31, 2014 , the Company had authorized 16,000,000 shares of Series A convertible preferred stock ("Series A Preferred Stock"), $0.0001 par value per share, for issuance. During March, April and May 2014, the Company issued an aggregate of 15,775,221 shares of Series A Preferred Stock for $1.00 per share, resulting in net proceeds to the Company of $15,637,032 , which was also the carrying value of the Series A Preferred Stock as of December 31, 2014. As of December 31, 2014 , the Company had authorized 14,500,000 shares of of Series B convertible preferred stock ("Series B Preferred Stock"), $0.0001 par value per share, for issuance. From July to October 2014, the Company issued an aggregate of 14,078,647 shares of Series B Preferred Stock for $1.81 per share, resulting in net proceeds to the Company of $25,394,135 , which was also the carrying value of the Series B Preferred Stock as of December 31, 2014. In conjunction with the Company's IPO in February 2015, all shares of the Series A and Series B Preferred Stock converted into common stock. As of December 31, 2015 , there were no shares of Series A convertible preferred stock or Series B convertible preferred stock authorized. On February 3, 2015, the Company filed an amended and restated certificate of incorporation (the “Restated Certificate”) with the Secretary of State of the State of Delaware in connection with the closing of the Company’s IPO. As of December 31, 2015, under the Restated Certificate, the Company is authorized to issue 10,000,000 shares of preferred stock ("Preferred Stock") with a par value of $0.0001 per share. The Company has not issued any shares of Preferred Stock as of December 31, 2015. |
Common stock
Common stock | 12 Months Ended |
Dec. 31, 2015 | |
Equity [Abstract] | |
Common stock | Common stock As of December 31, 2015 , the Company had authorized 100,000,000 shares of common stock, $0.0001 par value per share. Each share of common stock is entitled to one vote. The holders of common stock are also entitled to receive dividends whenever funds are legally available and when declared by the board of directors. The Company does not intend to declare dividends for the foreseeable future. Restricted common stock In March 2014, the Company sold 4,553,415 shares of restricted common stock to the founders of the Company ("recipients"), for $0.0004 per share, for total proceeds of $1,950 . In April 2014, based upon anti-dilution provisions granted to the founders, an additional 867,314 shares of restricted common stock were sold to the same founders, after which the anti-dilution provisions were terminated. The restricted common stock vested 25% upon issuance, and the remaining 75% vests ratably over four years , during which time the Company has the right to repurchase the unvested shares held by a recipient if the relationship between such recipient and the Company ceases. If the relationship terminates, the Company has 90 days to repurchase unvested shares at $0.0004 . Such shares are not accounted for as outstanding until they vest. There were 3,218,467 shares of restricted common stock outstanding as of December 31, 2015 . The following is a summary of restricted common stock activity: Number of Shares Weighted-Average Grant Date Fair Value Non-vested at December 31, 2014 3,218,590 $ 0.10 Issued — Vested (1,016,328 ) 0.10 Forfeited — — Non-vested at December 31, 2015 2,202,262 $ 0.10 The total fair value of shares vested during the twelve months ended December 31, 2015 and the period from February 26, 2014 (inception) to December 31, 2014 was approximately $15,616,000 and $3,620,000 , respectively. Employee stock purchase plan In 2015, the Company's Board of Directors adopted, and the Company's stockholders approved, the 2015 Employee Stock Purchase Plan ("the ESPP"). As of the December 31, 2015 , no shares of common stock have been purchased under the ESPP. Shares reserved for future issuance The Company has reserved the following number of shares of common stock for future issuance: As of December 31, 2015 2014 Vesting of restricted common stock 2,202,262 3,218,590 Stock-based compensation awards 2,031,528 1,189,314 Employee stock purchase plan 175,131 — Conversion of Series A Preferred Stock — 3,683,637 Conversion of Series B Preferred Stock — 3,287,471 Total 4,408,921 11,379,012 |
Stock-based compensation
Stock-based compensation | 12 Months Ended |
Dec. 31, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-based compensation | Stock-based compensation In March 2014, the Company adopted the Flex Pharma, Inc. 2014 Equity Incentive Plan (the "Plan"), under which it may grant incentive stock options, non-qualified stock options, restricted stock awards, restricted stock units and stock appreciation rights to purchase up to 116,754 shares of common stock. In April 2014, the Company amended the Plan to reserve for the issuance of up to 1,451,087 shares of common stock pursuant to equity awards. In September 2014, the Company further amended the Plan to reserve for the issuance of up to 2,070,200 shares of common stock pursuant to equity awards. Terms of stock award agreements, including vesting requirements, are determined by the board of directors, subject to the provisions of the 2014 Plan. For options granted under the 2014 Plan, the exercise price equaled the fair market value of the common stock as determined by the board of directors on the date of grant. No further awards will be granted under the 2014 Plan. In January 2015, the Company's board of directors adopted, and the Company's stockholders approved, the 2015 Equity Incentive Plan (the "2015 Plan"), which became effective immediately prior to the closing of the Company's IPO. The 2015 Plan provides for the grant of incentive stock options ("ISOs"), nonstatutory stock options, restricted stock awards, restricted stock units, stock appreciation rights, performance-based stock awards, and other stock-based awards. Additionally, the 2015 Plan provides for the grant of performance-based cash awards. ISOs may be granted only to the Company's employees. All other awards may be granted to the Company's employees, including officers, and to non-employee directors and consultants. As of December 31, 2015, there were 206,555 shares remaining available for the grant of stock awards under the 2015 Plan. During the period from February 26, 2014 (inception) to December 31, 2015 , the Company granted a total of 155,276 stock options to non-employee consultants and members of its Scientific Advisory Board, which are included in the following table. The options generally vest over a four -year period, and have a contractual term of ten years . The total stock-based compensation expense related to all non-employee stock options for the twelve months ended December 31, 2015 and the period from February 26, 2014 (inception) to December 31, 2014 was approximately $517,336 and $ 149,000 , respectively. The Company has awarded stock options to its employees, directors, advisors and consultants, pursuant to the plans described above. Stock options subsequent to the completion of the Company's IPO are granted with an exercise price equal to the closing market price of the Company's common stock on the date of grant. Stock options generally vest over one to four years and have a contractual term of ten years. Stock options are valued using the Black-Scholes option pricing model and compensation cost is recognized based on the resulting value over the service period. Unvested awards to non-employees are re-measured at each vest date and at each financial reporting date. The following table summarizes stock option activity for employees and non-employees for the twelve months ended December 31, 2015: Shares Weighted-Average Exercise Price Weighted-Average Remaining Contractual Term (in years) Aggregate Intrinsic Value Outstanding at December 31, 2014 926,832 $ 3.40 9.67 $ 6,846,054 Granted 994,748 13.07 Exercised (47,280 ) 8.63 Cancelled or forfeited (49,327 ) 10.69 Outstanding at December 31, 2015 1,824,973 $ 8.34 8.90 $ 9,073,673 Exercisable at December 31, 2015 372,508 $ 5.17 8.75 $ 2,883,387 Vested or expected to vest at December 31, 2015 1,617,617 $ 8.05 8.82 $ 8,625,871 The Company granted stock options to purchase an aggregate of 994,748 shares of its common stock during the year ended December 31, 2015 and 1,020,234 shares of its common stock during the period from February 26, 2014 (inception) to December 31, 2014. The weighted-average grant date fair value of option awards granted were $8.55 and $2.20 , for the year ended December 31, 2015 and during the period from February 26, 2014 (inception) to December 31, 2014, respectively. There were 47,280 stock options exercised with a weighted-average exercise price of $8.63 during the year ended December 31, 2015 and 13,572 stock options exercised with a weighted-average exercise price of $0.60 during the period from February 26, 2014 (inception) to December 31, 2014. The intrinsic value of stock options exercised during the year ended December 31, 2015 and during the period from February 26, 2014 (inception) to December 31, 2014 was $149,386 and $51,719 , respectively. The intrinsic value is calculated as the difference between the fair value of the Company's common stock and the exercise price of the options at the date of exercise. The Company estimates the fair value of each stock option award on the grant date using the Black-Scholes option-pricing model based on the following assumptions and the assumptions regarding the fair value of the underlying Common Stock on each measurement date: Year Ended December 31, 2015 Period from Expected volatility 72.98% to 74.94% 75.8% to 76.4% Risk-free interest rate 1.62% to 2.49% 1.59% to 2.71% Expected term 5.3 - 10 years 6 - 10 years Expected dividend yield 0 % 0 % Total stock-based compensation expense recognized for employee and non-employee restricted common stock, and stock options granted to employees and non-employees is included in the Company's consolidated statements of operations and comprehensive loss as follows: Year Ended December 31, 2015 Period from Research and development $ 3,192,063 $ 648,001 Selling, general and administrative 3,405,296 814,060 Total $ 6,597,359 $ 1,462,061 As of December 31, 2015 , there was approximately $15,495,100 of total unrecognized compensation cost related to non-vested equity awards. Total unrecognized compensation cost will be adjusted for the re-measurement of non-employee awards as well as future changes in employee and non-employee forfeitures, if any. The Company expects to recognize that cost over a remaining weighted-average period of 2.37 years . In November 2015, the Company granted 150,000 performance-based stock options to an employee which are included in the table of stock option activity above. The options will vest based upon the achievement of certain future revenue milestones. As of December 31, 2015, the achievement of these vesting milestones was not considered probable. Unrecognized stock-based compensation expense related to this award was approximately $1,000,000 as of December 31, 2015. The Company records stock-based compensation expense for stock option grants subject to performance-based vesting over the remaining service period when management determines that achievement of the milestone is probable. Management evaluates when the achievement of a performance-based milestone is probable based on the relative satisfaction of the performance conditions as of the reporting date. |
Income taxes
Income taxes | 12 Months Ended |
Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |
Income taxes | Income taxes For the year ended December 31, 2015 and for the period from February 26, 2014 (inception) to December 31, 2014, the Company did not record a current or deferred income tax provision or benefit. The Company's losses before income taxes for the periods presented consisted solely of domestic losses. The following table presents a reconciliation of income tax expense (benefit) computed at the statutory federal income tax rate to the effective income tax rate as reflected in the consolidated financial statements: Year Ended December 31, 2015 Period from Federal income tax expense at statutory rate 35.0 % 35.0 % State income tax, net of federal benefit 3.4 % 3.7 % Permanent differences (0.2 )% (0.3 )% Stock-based compensation (6.3 )% (5.3 )% Research credits 1.8 % 1.2 % Prior year true ups 0.4 % n/a Change in valuation allowance (34.1 )% (34.3 )% Effective tax rate 0.0 % 0.0 % Deferred income tax assets and liabilities are determined based upon temporary differences between the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The following table presents the significant components of the Company's deferred tax assets and liabilities: December 31, 2015 December 31, 2014 Deferred tax assets: U.S. and state net operating loss carryforwards $ 11,118,289 $ 2,708,861 Accruals and other temporary differences 510,897 23,829 Amortization 33,824 36,742 Stock-based compensation 473,801 57,120 Tax credit carryforward 671,012 87,762 Total deferred tax assets 12,807,823 2,914,314 Less valuation allowance (12,688,401 ) (2,751,295 ) Deferred tax assets 119,422 163,019 Deferred tax liabilities: Stock-based compensation (110,366 ) (162,779 ) Depreciation (9,056 ) (240 ) Accruals and other temporary differences — — Deferred tax liabilities (119,422 ) (163,019 ) Net deferred tax assets $ — $ — As of December 31, 2015 , the Company has U.S. federal net operating loss carryforwards of approximately $28,200,000 and U.S. state net operating loss carryforwards of approximately $24,100,000 , which are available to reduce future taxable income. Approximately $100,000 of the federal and state net operating loss carryforwards will result in an increase to additional paid-in capital if and when these carryforwards are used to reduce federal and state income taxes payable. The Company also had federal research and development tax credit carryforwards of $500,000 and state research and development tax credit carryforwards of $200,000 , which may be used to offset future tax liabilities. These federal and state operating loss carryforwards and tax credit carryforwards will expire at various dates through 2035 . Under the provisions of the Internal Revenue Code, the net operating loss and tax credit carryforwards are subject to review and possible adjustment by the Internal Revenue Service and state tax authorities. Net operating loss and tax credit carryforwards may become subject to an annual limitation in the event of certain cumulative changes in the ownership interest of significant shareholders over a three-year period in excess of 50 percent, as defined under Sections 382 and 383 of the Internal Revenue Code, respectively, as well as similar state provisions. This could limit the amount of tax attributes that can be utilized annually to offset future taxable income or tax liabilities. The amount of the annual limitation is determined based on the value of the Company immediately prior to the ownership change. Subsequent ownership changes may further affect the limitation in future years. The Company has completed financings since its inception which may have resulted in a change in control as defined by Sections 382 and 383 of the Internal Revenue Code, or could result in a change in control in the future. The Company has not conducted an assessment to determine whether there may have been a Section 382 or 383 ownership changes. ASC 740 requires a valuation allowance to reduce the deferred tax assets reported if, based on the weight of available evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized. After considerations of all the evidence, both positive and negative, the Company continues to maintain a valuation allowance for the full amount of the 2015 deferred tax asset because it is more likely than not that the deferred tax asset will not be realized. The valuation allowance increased by $9,900,000 from December 31, 2014 to December 31, 2015, primarily due to an increase in net operating losses. The Company has no unrecognized tax benefits. Interest and penalty charges, if any, related to uncertain tax positions would be classified as income tax expenses in the accompanying consolidated statement of operations. At December 31, 2015 and 2014, the Company had no accrued interest or penalties related to uncertain tax positions. In November 2015, the FASB issued ASU No. 2015-17 Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes . ASU 2015-17 simplifies the presentation of deferred income taxes by eliminating the separate classification of deferred income tax liabilities and assets into current and noncurrent amounts in the consolidated balance sheet. The amendments in the update require that all deferred tax liabilities and assets be classified as noncurrent in the consolidated balance sheet. The amendments in this update are effective for annual periods beginning after December 15, 2016, and interim periods therein and may be applied either prospectively or retrospectively to all periods presented. Early adoption is permitted. The Company has early adopted this standard in the fourth quarter of 2015 on a prospective basis. As a result, the Company’s deferred taxes are presented as noncurrent in the consolidated financial statements as of December 31, 2015, which after application of the valuation allowance, results in no noncurrent deferred taxes presented in the consolidated financial statements. |
Net loss per share
Net loss per share | 12 Months Ended |
Dec. 31, 2015 | |
Earnings Per Share [Abstract] | |
Net loss per share | Net loss per share Because the Company has reported net losses for the periods presented, diluted net loss per common share is the same as basic net loss per common share. The following potentially dilutive securities outstanding, prior to the use of the treasury stock method or if-converted method, have been excluded from the computation of diluted weighted-average shares outstanding, because such securities had an antidilutive impact due to the loss reported for the year ended December 31, 2015 and for the period from February 26, 2014 (inception) to December 31, 2014: Year Ended December 31, 2015 Period from Series A Preferred Stock — 15,775,221 Series B Preferred Stock — 14,078,647 Options to purchase common stock 1,824,973 926,832 Unvested restricted common stock 2,202,262 3,218,590 Total 4,027,235 33,999,290 |
Related party
Related party | 12 Months Ended |
Dec. 31, 2015 | |
Related Party Transactions [Abstract] | |
Related party | Related party The Company licensed a portion of its office space to ECLDS, LLC, which is a Company controlled by the Company's Chief Executive Officer. In October 2015, the license agreement was assigned by ECLDS, LLC to a third party, that is not owned by the Company's Chief Executive Officer, but for which a business relationship exists. Under the terms of the license, the entity charged the same rental rate as that was charged to the Company. During the year ended December 31, 2015 , and during the period from February 26, 2014 to December 31, 2014, the Company received approximately $61,000 and $34,000 , respectively, in license fees from the aforementioned related party, and such amounts received have been recorded as a reduction to rent expense. |
Quarterly financial information
Quarterly financial information (unaudited) | 12 Months Ended |
Dec. 31, 2015 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly financial information (unaudited) | Quarterly financial information (unaudited) First Quarter Ended March 31, 2015 Second Quarter Ended June 30, 2015 Third Quarter Ended September 30, 2015 Fourth Quarter Ended December 31, 2015 Operating expenses: Research and development $ 2,804,946 $ 3,190,178 $ 3,445,200 $ 3,309,055 Selling, general and administrative 3,216,212 3,904,403 4,722,281 4,621,383 Total operating expenses 6,021,158 7,094,581 8,167,481 7,930,438 Loss from operations (6,021,158 ) (7,094,581 ) (8,167,481 ) (7,930,438 ) Interest income, net 3,577 16,183 14,637 37,631 Net loss $ (6,017,581 ) $ (7,078,398 ) $ (8,152,844 ) $ (7,892,807 ) Net loss per share attributable to common stockholders — basic and diluted $ (0.59 ) $ (0.47 ) $ (0.53 ) $ (0.51 ) Weighted-average number of common shares outstanding — basic and diluted 10,179,955 15,034,764 15,290,435 15,551,800 Period from February 26, 2014 (Inception) to March 31, 2014 Second Quarter Ended June 30, 2014 Third Quarter Ended September 30, 2014 Fourth Quarter Ended December 31, 2014 Operating expenses: Research and development $ 30,023 $ 1,099,644 $ 909,123 $ 1,965,121 Selling, general and administrative 62,700 1,092,665 1,084,240 1,786,290 Total operating expenses 92,723 2,192,309 1,993,363 3,751,411 Loss from operations (92,723 ) (2,192,309 ) (1,993,363 ) (3,751,411 ) Interest income, net — 2,658 6,926 9,362 Net loss $ (92,723 ) $ (2,189,651 ) $ (1,986,437 ) $ (3,742,049 ) Net loss per share attributable to common stockholders — basic and diluted $ (0.07 ) $ (1.42 ) $ (1.11 ) $ (1.82 ) Weighted-average number of common shares outstanding — basic and diluted 1,370,125 1,539,463 1,797,664 2,061,132 |
Subsequent events
Subsequent events | 12 Months Ended |
Dec. 31, 2015 | |
Subsequent Events [Abstract] | |
Subsequent events | Subsequent events The Company has completed an evaluation of all subsequent events after the balance sheet date of December 31, 2015 through the date these consolidated financial statements were issued. The Company has concluded that no subsequent events have occurred that require disclosure, except as described below. New York office space lease amendment On January 20, 2016, the Company amended its New York office space operating lease. The lease, which was originally scheduled to expire on October 31, 2016, is now scheduled to expire on October 31, 2018. In conjunction with the amendment, the Company will lease additional office space within the currently leased building beginning on April 1, 2016. The amendment to the operating lease agreement resulted in an aggregate increase to future minimum lease payments of $320,684 through 2018, as well as an additional security deposit in the amount of $25,800 . Increase in shares of common stock reserved for issuance On January 21, 2016, the Company's board of directors approved an increase of 717,755 shares of common stock reserved for issuance under the 2015 Plan. The number of shares of common stock reserved for issuance under the 2015 Plan will automatically increase on January 1 of each year, through and including January 1, 2025, by 4% of the total number of shares of capital stock outstanding on December 31 of the preceding calendar year, or a lesser number of shares determined by the Company's board of directors. |
Summary of significant accoun25
Summary of significant accounting policies (Policies) | 12 Months Ended |
Dec. 31, 2015 | |
Accounting Policies [Abstract] | |
Basis of presentation | The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America ("GAAP"). Any reference in these notes to applicable guidance is meant to refer to the authoritative United States generally accepted accounting principles as found in the Accounting Standards Codification ("ASC") and Accounting Standards Update ("ASU") of the Financial Accounting Standards Board ("FASB"). |
Use of estimates | The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. On an ongoing basis, the Company's management evaluates its estimates, which include, but are not limited to, estimates related to clinical study accruals, stock-based compensation expense, and amounts of expenses during the reported period. The Company bases its estimates on historical experience and other market-specific or other relevant assumptions that it believes to be reasonable under the circumstances. Actual results may differ from those estimates or assumptions. Prior to the Company's initial public offering ("IPO"), the Company utilized significant estimates and assumptions in determining the fair value of its common stock. The Company utilized various valuation methodologies in accordance with the framework of the 2004 and 2013 American Institute of Certified Public Accountants Technical Practice Aids, Valuation of Privately-Held Company Equity Securities Issued as Compensation , to estimate the fair value of its common stock. Each valuation methodology included estimates and assumptions that required the Company's judgment. These estimates and assumptions included a number of objective and subjective factors, including external market conditions affecting the biotechnology industry sector, the prices at which the Company sold shares of preferred stock, the superior rights and preferences of securities senior to the Company's common stock at the time and the likelihood of achieving a liquidity event, such as an initial public offering or a sale of the Company. Significant changes to the key assumptions used in the valuations could have resulted in different fair values of common stock at each valuation date and may have materially affected the financial statements. |
Principles of consolidation | Principles of consolidation The consolidated financial statements include the accounts of the Company and its wholly owned subsidiary, TK Pharma, Inc., a Massachusetts Securities Corporation. All significant intercompany balances and transactions have been eliminated in consolidation. |
Segment information | Segment information Operating segments are defined as components of an enterprise about which separate discrete information is available for evaluation by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and assess performance. The Company and the Company's chief operating decision maker, the Company's Chief Executive Officer, view the Company's operations and manage its business as one operating segment, which is the business of developing and commercializing products for nocturnal leg cramps, muscle cramps, spasms and spasticity associated with severe neuromuscular conditions, and exercise-associated muscle cramps. The Company operates in only one geographic segment, the United States. |
Concentrations of credit risk and off-balance sheet risk | Concentrations of credit risk and off-balance sheet risk Cash, cash equivalents and marketable securities are financial instruments that potentially subject the Company to concentrations of credit risk. The Company's cash, cash equivalents and marketable securities are held in accounts at financial institutions that management believes are creditworthy. The Company has not experienced any credit losses in such accounts and does not believe it is exposed to any significant credit risk on these funds. The Company has no financial instruments with off-balance sheet risk of loss. |
Property and equipment | Property and equipment Property and equipment is stated at cost, less accumulated depreciation. Maintenance and repairs that do not improve or extend the lives of the respective assets are expensed to operations as incurred, while costs of major additions and betterments are capitalized. Upon disposal, the related cost and accumulated depreciation is removed from the accounts and any resulting gain or loss is included in the results of operations. Depreciation is recorded, once assets are placed in service, using the straight-line method over the estimated useful lives of the respective assets, which are as follows: Asset type Estimated useful life Computers and computer equipment 3 years Laboratory equipment 3 years Manufacturing equipment 3 years |
Impairment of long-lived assets | Impairment of long-lived assets The Company evaluates long-lived assets for potential impairment when events or changes in circumstances indicate the carrying value of the assets may not be recoverable. Recoverability is measured by comparing the book values of the assets to the expected future net undiscounted cash flows that the assets are expected to generate. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the book value of the assets exceed their fair value. |
Research and development expenses | Research and development expense Research and development costs are charged to expense as incurred in performing research and development activities. The costs include employee compensation costs, clinical study costs, external consultant costs, regulatory costs and facilities and overhead costs. Facilities and overhead costs primarily include the allocation of insurance, rent, utility and office-related expenses attributable to research and development personnel. The Company records payments made to outside vendors in advance of services performed or goods being delivered for use in research and development activities as prepaid expenses, which are expensed as services are performed or goods are delivered. |
Stock-based compensation expense | Stock-based compensation expense The Company accounts for its stock-based compensation awards to employees and directors in accordance with FASB ASC Topic 718, Compensation-Stock Compensation ("ASC 718"). ASC 718 requires all stock-based payments to employees, including grants of employee stock options, to be recognized in the statement of operations based on their grant date fair values. Compensation expense related to awards to employees with service conditions is recognized on a straight-line basis based on the grant date fair value over the associated service period of the award, which is generally the vesting term. Compensation expense related to awards to employees with performance conditions is recognized based on grant date fair value over the remaining service period when management determines that achievement of the milestone is probable. Management evaluates when the achievement of a performance-based milestone is probable based on the relative satisfaction of the performance conditions as of the reporting date. The Company accounts for stock-based compensation arrangements with non-employees based upon the fair value of the consideration received or the equity instruments issued, whichever is more reliably measurable, in accordance with the provisions of FASB ASC Topic 505-50, Equity-Based Payments to Non-Employees . The measurement date for non-employee awards is generally the date performance of services required from the non-employee is complete, resulting in periodic adjustments to stock-based compensation expense during the vesting period for changes in the fair value of the awards. Stock-based compensation costs for non-employee service awards are recognized as services are provided, which is generally the vesting period, on a straight-line basis. The unvested portion of the awards is subject to re-measurement over the vesting period. The Company estimates the fair value of its stock options using the Black-Scholes option pricing model, which requires the input of subjective assumptions, including (a) the expected stock price volatility, (b) the expected term of the award, (c) the risk-free interest rate, (d) expected dividends and (e) the estimated fair value of the Company's common stock on the measurement date. Due to the lack of significant trading history for the Company's common stock, it has based its estimate of expected volatility on the historical volatility of a group of similar companies that are publicly traded. When selecting these public companies on which it has based its expected stock price volatility, the Company selected companies with comparable characteristics, including enterprise value, risk profiles, position within the industry, and with historical share price information sufficient to meet the expected term of the stock-based awards. The Company computes historical volatility data using the volatility for the selected companies' shares during the equivalent period of the calculated expected term of the stock-based awards. The Company will continue to apply this process until a sufficient amount of historical information regarding the volatility of its own stock price becomes available. Due to the lack of Company specific historical option activity, the Company has estimated the expected term of its employee stock options using the "simplified" method, whereby, the expected term equals the arithmetic average of the vesting term and the original contractual term of the option. The expected term for non-employee awards is the remaining contractual term of the option. The risk-free interest rates are based on the U.S. Treasury securities with a maturity date commensurate with the expected term of the associated award. The Company has never paid, and does not expect to pay dividends in the foreseeable future. The Company is also required to estimate forfeitures at the time of grant and revise those estimates in subsequent periods if actual forfeitures differ from its estimates. The Company records stock-based compensation expense only for those awards that are expected to vest. To the extent that actual forfeitures differ from the Company's estimates, the differences are recorded as a cumulative adjustment in the period the estimates were revised. |
Income taxes | Income taxes Income taxes are recorded in accordance with FASB ASC Topic 740, Income Taxes ("ASC 740"), which provides for deferred taxes using an asset and liability approach. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial reporting and the tax reporting basis of assets and liabilities and are measured using the enacted tax rates and laws that are expected to be in effect when the differences are expected to reverse. The Company provides a valuation allowance against net deferred tax assets unless, based upon the available evidence, it is more likely than not that the deferred tax assets will be realized. The Company has evaluated available evidence and concluded that the Company may not realize the benefit of its deferred tax assets; therefore a valuation allowance has been established for the full amount of the deferred tax assets. The Company accounts for uncertain tax positions in accordance with the provisions of ASC 740. When uncertain tax positions exist, the Company recognizes the tax benefit of tax positions to the extent that the benefit will more likely than not be realized. The determination as to whether the tax benefit will more likely than not be realized is based upon the technical merits of the tax position as well as consideration of the available facts and circumstances. As of December 31, 2015 and December 31, 2014, the Company did not have any significant uncertain tax positions. The Company's practice is to recognize interest and/or penalties related to income tax matters in income tax expense. |
Net loss per share attributable to common stockholders | Net loss per share attributable to common stockholders Basic net loss per share is computed by dividing the net loss attributable to common stockholders by the weighted-average number of common shares outstanding for the period. Diluted net loss per share is computed by dividing the net loss attributable to common stockholders by the weighted-average number of common shares and dilutive common stock equivalents outstanding for the period, determined using the treasury stock method and the if-converted method, for convertible securities, if inclusion of these is dilutive. For year ended December 31, 2015 and the period from February 26, 2014 (inception) December 31, 2014, the Company has excluded the effects of all potentially dilutive shares from the weighted-average number of common shares outstanding as their inclusion in the computation for each period would be anti-dilutive due to the net loss per share incurred by the Company. |
Comprehensive loss | Comprehensive loss Comprehensive loss is the change in equity of a company during a period from transactions and other events and circumstances, excluding transactions resulting from investments by owners and distributions to owners. Comprehensive loss includes net loss and the change in accumulated other comprehensive loss for the period. |
Recent accounting pronouncements | Recent accounting pronouncements In July 2015, the FASB issued ASU No. 2015-11, Inventory (Topic 330) . This ASU simplifies the measurement of inventory by requiring certain inventory to be measured at the lower of cost or net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. The amendments in this ASU are effective for fiscal years beginning after December 15, 2016 and for interim periods therein. Subsequent measurement is unchanged for inventory measured using LIFO or the retail inventory method. The Company is currently in the process of evaluating the impact of the guidance related to the Company's anticipated launch of its consumer product in the second quarter of 2016. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) . The ASU provides for a single comprehensive model for use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance. The accounting standard is effective for interim and annual periods beginning after December 15, 2016 with no early adoption permitted. In July 2015, the FASB deferred the effective date of this accounting update to annual periods beginning after December 15, 2017, along with an option to permit early adoption as of the original effective date. The Company is required to adopt the amendments in the ASU using one of two acceptable methods: retrospectively to all prior reporting periods presented, with certain practical expedients permitted; or retrospectively with the cumulative effect of initially adopting the ASU recognized at the date of initial application. The Company is currently in the process of evaluating the impact of the guidance related to the Company's anticipated launch of its consumer product in the second quarter of 2016. In August 2014, the FASB issued ASU No. 2014-15 Presentation of Financial Statements - Going Concern (Subtopic 205-40) . The ASU requires management of public and private companies to evaluate whether there is substantial doubt about the entity’s ability to continue as a going concern within one year after the date that the financial statements are issued. Management’s evaluation should be based on relevant conditions and events that are known and reasonably knowable at the date that the financial statements are issued. If conditions or events raise substantial doubt about an entity’s ability to continue as a going concern, and substantial doubt is not alleviated after consideration of management’s plans, an entity should include a statement in the footnotes indicating that there is substantial doubt about the entity’s ability to continue as a going concern within one year after the date that the financial statements are issued. The new standard is effective for annual periods ending after December 15, 2016, and for annual periods and interim periods thereafter. Early application is permitted. The Company has concluded, that if this standard had been adopted as of December 31, 2015, substantial doubt about the Company’s ability to continue as a going concern does not exist. In February 2015, the FASB issued ASU No. 2015-02 Consolidation (Topic 810): Amendments to the Consolidation Analysis. ASU 2015-02 changes the analysis that a reporting entity must perform to determine whether it should consolidate certain types of legal entities. It is effective for annual reporting periods, and interim periods within those years, beginning after December 15, 2015. Early adoption is permitted, including adoption in an interim period. The accounting standard is not expected to have a material impact on the Company's consolidated financial statements. In November 2015, the FASB issued ASU No. 2015-17 Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes . ASU 2015-17 simplifies the presentation of deferred income taxes by eliminating the separate classification of deferred income tax liabilities and assets into current and noncurrent amounts in the consolidated balance sheet. The amendments in the update require that all deferred tax liabilities and assets be classified as noncurrent in the consolidated balance sheet. The amendments in this update are effective for annual periods beginning after December 15, 2016, and interim periods therein and may be applied either prospectively or retrospectively to all periods presented. Early adoption is permitted. The Company early adopted this standard in the fourth quarter of 2015 on a prospective basis and did not retrospectively adjust the prior period. As a result, all of the Company’s deferred taxes are presented as long-term in the consolidated financial statements as of December 31, 2015. The Company did not reclassify current deferred tax assets and liabilities on the consolidated balance sheet as of December 31, 2014. Adoption did not have a material impact on the consolidated financial statements. In February 2016, the FASB issued ASU No. 2016-02 Leases . The ASU requires lessees to recognize the assets and liabilities on their balance sheet for the rights and obligations created by most leases and continue to recognize expenses on their income statements over the lease term. It will also require disclosures designed to give financial statement users information on the amount, timing, and uncertainty of cash flows arising from leases. The guidance is effective for annual reporting periods beginning after December 15, 2018, and interim periods within those years. Early adoption is permitted for all entities. The Company is currently evaluating the impact of ASU 2016-02 on its consolidated financial statements and disclosures. I |
Subsequent events | Subsequent events The Company considers events or transactions that occur after the balance sheet date but prior to the issuance of the consolidated financial statements for potential recognition or disclosure in the consolidated financial statements. Subsequent events have been evaluated through the date these consolidated financial statements were issued for potential recognition or disclosure in the consolidated financial statements (Note 16). |
Fair value measurements | Fair value measurements The Company records cash equivalents and marketable securities at fair value. ASC Topic 820 Fair Value Measurements and Disclosures established a fair value hierarchy for those instruments measured at fair value that distinguishes between assumptions based on market data (observable inputs) and the Company’s own assumptions (unobservable inputs). The hierarchy consists of three levels: Level 1 – Unadjusted quoted prices in active markets for identical assets or liabilities. Level 2 – Quoted prices for similar assets and liabilities in active markets, quoted prices in markets that are not active, or inputs which are observable, directly or indirectly, for substantially the full term of the asset or liability. Level 3 – Unobservable inputs that reflect the Company’s own assumptions about the assumptions market participants would use in pricing the asset or liability in which there is little, if any, market activity for the asset or liability at the measurement date. |
Summary of significant accoun26
Summary of significant accounting policies (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Accounting Policies [Abstract] | |
Depreciation over estimated useful life | Depreciation is recorded, once assets are placed in service, using the straight-line method over the estimated useful lives of the respective assets, which are as follows: Asset type Estimated useful life Computers and computer equipment 3 years Laboratory equipment 3 years Manufacturing equipment 3 years Property and equipment, net consists of the following: December 31, 2015 December 31, 2014 Computers and computer equipment $ 177,240 $ 62,773 Laboratory equipment 13,368 13,368 Capital in progress 251,893 21,000 Total property and equipment 442,501 97,141 Accumulated depreciation (60,064 ) (11,997 ) Property and equipment, net $ 382,437 $ 85,144 |
Reclassification out of Accumulated Other Comprehensive Income | The following tables summarize the changes in accumulated other comprehensive loss during the year ended December 31, 2015. There was no accumulated other comprehensive loss for the period from February 26, 2014 to December 31, 2014: Balance as of December 31, 2014 $ — Other comprehensive loss (24,654 ) Balance as of December 31, 2015 $ (24,654 ) |
Fair value measurements (Tables
Fair value measurements (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Fair Value Disclosures [Abstract] | |
Summary of Cash Equivalents and Marketable Securities Measured at Fair Value on a Recurring Basis | The following table summarizes the cash equivalents and marketable securities measured at fair value on a recurring basis as of December 31, 2015: Level 1 Level 2 Level 3 Total Cash equivalents $ 58,575,348 $ 1,410,322 $ — $ 59,985,670 Marketable securities: — Corporate debt securities — 26,965,297 — 26,965,297 $ 58,575,348 $ 28,375,619 $ — $ 86,950,967 |
Cash equivalents and marketab28
Cash equivalents and marketable securities (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Cash and Cash Equivalents [Abstract] | |
Schedule of Marketable Securities | Marketable securities at December 31, 2015 consisted of the following: Amortized Cost Unrealized Gains Unrealized Losses Fair Value Current (due within 1 year): Corporate debt securities $ 24,666,607 $ 1,878 $ (16,137 ) $ 24,652,348 Noncurrent (due after 1 year through 5 years): Corporate debt securities 2,323,344 — (10,395 ) 2,312,949 Total $ 26,989,951 $ 1,878 $ (26,532 ) $ 26,965,297 |
Property and equipment, net (Ta
Property and equipment, net (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Property, Plant and Equipment [Abstract] | |
Property and equipment, net | Depreciation is recorded, once assets are placed in service, using the straight-line method over the estimated useful lives of the respective assets, which are as follows: Asset type Estimated useful life Computers and computer equipment 3 years Laboratory equipment 3 years Manufacturing equipment 3 years Property and equipment, net consists of the following: December 31, 2015 December 31, 2014 Computers and computer equipment $ 177,240 $ 62,773 Laboratory equipment 13,368 13,368 Capital in progress 251,893 21,000 Total property and equipment 442,501 97,141 Accumulated depreciation (60,064 ) (11,997 ) Property and equipment, net $ 382,437 $ 85,144 |
Accrued expenses and other cu30
Accrued expenses and other current liabilities (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Payables and Accruals [Abstract] | |
Accrued expenses | Accrued expenses and other current liabilities consist of the following: December 31, 2015 December 31, 2014 Payroll and employee-related costs $ 1,299,248 $ 34,218 Research and development costs 307,666 125,067 Consumer product-related costs 198,887 23,635 Professional fees 129,625 15,500 Other 11,948 42,955 Deferred IPO issuance costs — 175,149 Total $ 1,947,374 $ 416,524 |
Other current liabilities | Accrued expenses and other current liabilities consist of the following: December 31, 2015 December 31, 2014 Payroll and employee-related costs $ 1,299,248 $ 34,218 Research and development costs 307,666 125,067 Consumer product-related costs 198,887 23,635 Professional fees 129,625 15,500 Other 11,948 42,955 Deferred IPO issuance costs — 175,149 Total $ 1,947,374 $ 416,524 |
Commitments and contingencies (
Commitments and contingencies (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Minimum future lease payments | As of December 31, 2015 , the minimum future lease payments under the Company's operating leases were as follows: 2016 $ 323,190 2017 168,793 Total minimum lease payments $ 491,983 |
Common stock (Tables)
Common stock (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Equity [Abstract] | |
Restricted common stock activity | The following is a summary of restricted common stock activity: Number of Shares Weighted-Average Grant Date Fair Value Non-vested at December 31, 2014 3,218,590 $ 0.10 Issued — Vested (1,016,328 ) 0.10 Forfeited — — Non-vested at December 31, 2015 2,202,262 $ 0.10 |
Shares reserved for future issuance | The Company has reserved the following number of shares of common stock for future issuance: As of December 31, 2015 2014 Vesting of restricted common stock 2,202,262 3,218,590 Stock-based compensation awards 2,031,528 1,189,314 Employee stock purchase plan 175,131 — Conversion of Series A Preferred Stock — 3,683,637 Conversion of Series B Preferred Stock — 3,287,471 Total 4,408,921 11,379,012 |
Stock-based compensation (Table
Stock-based compensation (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Summary of stock option activity | The following table summarizes stock option activity for employees and non-employees for the twelve months ended December 31, 2015: Shares Weighted-Average Exercise Price Weighted-Average Remaining Contractual Term (in years) Aggregate Intrinsic Value Outstanding at December 31, 2014 926,832 $ 3.40 9.67 $ 6,846,054 Granted 994,748 13.07 Exercised (47,280 ) 8.63 Cancelled or forfeited (49,327 ) 10.69 Outstanding at December 31, 2015 1,824,973 $ 8.34 8.90 $ 9,073,673 Exercisable at December 31, 2015 372,508 $ 5.17 8.75 $ 2,883,387 Vested or expected to vest at December 31, 2015 1,617,617 $ 8.05 8.82 $ 8,625,871 |
Schedule of fair value assumptions | The Company estimates the fair value of each stock option award on the grant date using the Black-Scholes option-pricing model based on the following assumptions and the assumptions regarding the fair value of the underlying Common Stock on each measurement date: Year Ended December 31, 2015 Period from Expected volatility 72.98% to 74.94% 75.8% to 76.4% Risk-free interest rate 1.62% to 2.49% 1.59% to 2.71% Expected term 5.3 - 10 years 6 - 10 years Expected dividend yield 0 % 0 % |
Summary of stock-based compensation expense | Total stock-based compensation expense recognized for employee and non-employee restricted common stock, and stock options granted to employees and non-employees is included in the Company's consolidated statements of operations and comprehensive loss as follows: Year Ended December 31, 2015 Period from Research and development $ 3,192,063 $ 648,001 Selling, general and administrative 3,405,296 814,060 Total $ 6,597,359 $ 1,462,061 |
Income taxes (Tables)
Income taxes (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |
Schedule of effective income tax rate reconciliation | The following table presents a reconciliation of income tax expense (benefit) computed at the statutory federal income tax rate to the effective income tax rate as reflected in the consolidated financial statements: Year Ended December 31, 2015 Period from Federal income tax expense at statutory rate 35.0 % 35.0 % State income tax, net of federal benefit 3.4 % 3.7 % Permanent differences (0.2 )% (0.3 )% Stock-based compensation (6.3 )% (5.3 )% Research credits 1.8 % 1.2 % Prior year true ups 0.4 % n/a Change in valuation allowance (34.1 )% (34.3 )% Effective tax rate 0.0 % 0.0 % |
Schedule of deferred tax assets and liabilities | The following table presents the significant components of the Company's deferred tax assets and liabilities: December 31, 2015 December 31, 2014 Deferred tax assets: U.S. and state net operating loss carryforwards $ 11,118,289 $ 2,708,861 Accruals and other temporary differences 510,897 23,829 Amortization 33,824 36,742 Stock-based compensation 473,801 57,120 Tax credit carryforward 671,012 87,762 Total deferred tax assets 12,807,823 2,914,314 Less valuation allowance (12,688,401 ) (2,751,295 ) Deferred tax assets 119,422 163,019 Deferred tax liabilities: Stock-based compensation (110,366 ) (162,779 ) Depreciation (9,056 ) (240 ) Accruals and other temporary differences — — Deferred tax liabilities (119,422 ) (163,019 ) Net deferred tax assets $ — $ — |
Net loss per share (Tables)
Net loss per share (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Earnings Per Share [Abstract] | |
Schedule of antidilutive securities excluded from computation of earnings per share | The following potentially dilutive securities outstanding, prior to the use of the treasury stock method or if-converted method, have been excluded from the computation of diluted weighted-average shares outstanding, because such securities had an antidilutive impact due to the loss reported for the year ended December 31, 2015 and for the period from February 26, 2014 (inception) to December 31, 2014: Year Ended December 31, 2015 Period from Series A Preferred Stock — 15,775,221 Series B Preferred Stock — 14,078,647 Options to purchase common stock 1,824,973 926,832 Unvested restricted common stock 2,202,262 3,218,590 Total 4,027,235 33,999,290 |
Quarterly financial informati36
Quarterly financial information (unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of quarterly financial information | First Quarter Ended March 31, 2015 Second Quarter Ended June 30, 2015 Third Quarter Ended September 30, 2015 Fourth Quarter Ended December 31, 2015 Operating expenses: Research and development $ 2,804,946 $ 3,190,178 $ 3,445,200 $ 3,309,055 Selling, general and administrative 3,216,212 3,904,403 4,722,281 4,621,383 Total operating expenses 6,021,158 7,094,581 8,167,481 7,930,438 Loss from operations (6,021,158 ) (7,094,581 ) (8,167,481 ) (7,930,438 ) Interest income, net 3,577 16,183 14,637 37,631 Net loss $ (6,017,581 ) $ (7,078,398 ) $ (8,152,844 ) $ (7,892,807 ) Net loss per share attributable to common stockholders — basic and diluted $ (0.59 ) $ (0.47 ) $ (0.53 ) $ (0.51 ) Weighted-average number of common shares outstanding — basic and diluted 10,179,955 15,034,764 15,290,435 15,551,800 Period from February 26, 2014 (Inception) to March 31, 2014 Second Quarter Ended June 30, 2014 Third Quarter Ended September 30, 2014 Fourth Quarter Ended December 31, 2014 Operating expenses: Research and development $ 30,023 $ 1,099,644 $ 909,123 $ 1,965,121 Selling, general and administrative 62,700 1,092,665 1,084,240 1,786,290 Total operating expenses 92,723 2,192,309 1,993,363 3,751,411 Loss from operations (92,723 ) (2,192,309 ) (1,993,363 ) (3,751,411 ) Interest income, net — 2,658 6,926 9,362 Net loss $ (92,723 ) $ (2,189,651 ) $ (1,986,437 ) $ (3,742,049 ) Net loss per share attributable to common stockholders — basic and diluted $ (0.07 ) $ (1.42 ) $ (1.11 ) $ (1.82 ) Weighted-average number of common shares outstanding — basic and diluted 1,370,125 1,539,463 1,797,664 2,061,132 |
Organization and operations (De
Organization and operations (Details) - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Accumulated deficit | $ 37,152,490 | $ 8,010,860 |
Cash, cash equivalents, and marketable securities | $ 93,651,992 |
Summary of significant accoun38
Summary of significant accounting policies - Narrative (Details) | Feb. 03, 2015USD ($)$ / sharesshares | Jan. 31, 2015 | Dec. 31, 2014USD ($)shares | Dec. 31, 2015USD ($)segmentshares |
Entity Location [Line Items] | ||||
Number of operating segments | segment | 1 | |||
IPO proceeds, net of issuance costs | $ | $ 79,900,000 | $ 0 | $ 80,435,430 | |
Common stock, number of shares issued from conversion of preferred stock (in shares) | 6,971,108 | |||
Common stock, shares authorized (shares) | 61,000,000 | 100,000,000 | ||
IPO issuance costs | $ | $ 1,848,737 | |||
Reverse stock split conversion ratio | 0.2335 | |||
IPO underwriting discounts and commissions | $ | $ 6,150,134 | |||
IPO | ||||
Entity Location [Line Items] | ||||
Common stock, shares issued | 5,491,191 | |||
Common stock, price per share (in usd per share) | $ / shares | $ 16 | |||
Over-Allotment Option | ||||
Entity Location [Line Items] | ||||
Common stock, shares issued | 91,191 | |||
United States | ||||
Entity Location [Line Items] | ||||
Number of geographic segments | segment | 1 |
Summary of significant accoun39
Summary of significant accounting policies - Depreciation Over Estimated Useful Life (Details) | 12 Months Ended |
Dec. 31, 2015 | |
Computers and computer equipment | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life | 3 years |
Laboratory equipment | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life | 3 years |
Manufacturing equipment | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life | 3 years |
Summary of significant accoun40
Summary of significant accounting policies - Summary of changes in accumulated other comprehensive loss (Details) - USD ($) | 10 Months Ended | 12 Months Ended |
Dec. 31, 2014 | Dec. 31, 2015 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||
Accumulated Other Comprehensive Loss, beginning balance | $ 0 | |
Other comprehensive loss | $ 0 | (24,654) |
Accumulated Other Comprehensive Loss, ending balance | $ 0 | $ (24,654) |
Restricted cash (Details)
Restricted cash (Details) - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted cash | $ 126,835 | $ 126,808 |
Letter of Credit | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted cash | $ 126,835 | $ 126,808 |
Fair value measurements (Detail
Fair value measurements (Details) | Dec. 31, 2015USD ($) |
Marketable securities: | |
Corporate debt securities | $ 26,965,297 |
Fair Value, Measurements, Recurring | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Cash equivalents | 59,985,670 |
Marketable securities: | |
Total assets | 86,950,967 |
Fair Value, Measurements, Recurring | Level 1 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Cash equivalents | 58,575,348 |
Marketable securities: | |
Total assets | 58,575,348 |
Fair Value, Measurements, Recurring | Level 2 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Cash equivalents | 1,410,322 |
Marketable securities: | |
Total assets | 28,375,619 |
Fair Value, Measurements, Recurring | Level 3 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Cash equivalents | 0 |
Marketable securities: | |
Total assets | 0 |
Fair Value, Measurements, Recurring | Corporate debt securities due within one year | |
Marketable securities: | |
Corporate debt securities | 26,965,297 |
Fair Value, Measurements, Recurring | Corporate debt securities due within one year | Level 1 | |
Marketable securities: | |
Corporate debt securities | 0 |
Fair Value, Measurements, Recurring | Corporate debt securities due within one year | Level 2 | |
Marketable securities: | |
Corporate debt securities | 26,965,297 |
Fair Value, Measurements, Recurring | Corporate debt securities due within one year | Level 3 | |
Marketable securities: | |
Corporate debt securities | $ 0 |
Cash equivalents and marketab43
Cash equivalents and marketable securities (Details) | Dec. 31, 2015USD ($)security | Dec. 31, 2014USD ($) |
Marketable securities: | ||
Amortized Cost | $ 26,989,951 | |
Unrealized Gains | 1,878 | |
Unrealized Losses | (26,532) | |
Fair Value | 26,965,297 | |
Marketable Securities, Current | 24,652,348 | $ 0 |
Marketable Securities, Noncurrent | $ 2,312,949 | 0 |
Number of debt securities held | security | 11 | |
Aggregate fair value of debt securities in an unrealized loss position | $ 24,967,915 | $ 0 |
Current Assets | Corporate debt securities | ||
Marketable securities: | ||
Amortized Cost | 24,666,607 | |
Unrealized Gains | 1,878 | |
Unrealized Losses | (16,137) | |
Fair Value | 24,652,348 | |
Noncurrent Assets | Corporate debt securities | ||
Marketable securities: | ||
Amortized Cost | 2,323,344 | |
Unrealized Gains | 0 | |
Unrealized Losses | (10,395) | |
Fair Value | $ 2,312,949 |
Property and equipment, net (De
Property and equipment, net (Details) - USD ($) | 10 Months Ended | 12 Months Ended |
Dec. 31, 2014 | Dec. 31, 2015 | |
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | $ 97,141 | $ 442,501 |
Accumulated depreciation | (11,997) | (60,064) |
Property and equipment, net | 85,144 | 382,437 |
Depreciation expense | 11,997 | 49,881 |
Computers and computer equipment | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 62,773 | 177,240 |
Laboratory equipment | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 13,368 | 13,368 |
Capital in progress | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | $ 21,000 | $ 251,893 |
Accrued expenses and other cu45
Accrued expenses and other current liabilities (Details) - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
Payables and Accruals [Abstract] | ||
Payroll and employee-related costs | $ 1,299,248 | $ 34,218 |
Research and development costs | 307,666 | 125,067 |
Consumer brand-related costs | 198,887 | 23,635 |
Professional fees | 129,625 | 15,500 |
Other | 11,948 | 42,955 |
Deferred IPO issuance costs | 0 | 175,149 |
Total | $ 1,947,374 | $ 416,524 |
Commitments and contingencies -
Commitments and contingencies - Minimum future lease payments (Details) | Dec. 31, 2015USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2,016 | $ 323,190 |
2,017 | 168,793 |
Total minimum lease payments | $ 491,983 |
Commitments and contingencies47
Commitments and contingencies - Narrative (Details) - USD ($) | 1 Months Ended | 10 Months Ended | 12 Months Ended |
Mar. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |||
Rent expense | $ 152,000 | $ 253,000 | |
Percent of gross sales due to related parties | 2.00% |
Convertible preferred stock - N
Convertible preferred stock - Narrative (Details) - USD ($) | 3 Months Ended | 4 Months Ended | 10 Months Ended | 12 Months Ended |
May. 31, 2014 | Oct. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2015 | |
Class of Stock [Line Items] | ||||
Preferred stock, authorized (shares) | 0 | 10,000,000 | ||
Preferred stock, par value (in usd per share) | $ 0.0001 | |||
Preferred stock, carrying value | $ 0 | $ 0 | ||
Series A convertible preferred stock | ||||
Class of Stock [Line Items] | ||||
Preferred stock, authorized (shares) | 16,000,000 | 0 | ||
Preferred stock, par value (in usd per share) | $ 0.0001 | |||
Issuance of stock/IPO proceeds, net of issuance costs (in shares) | 15,775,221 | |||
Convertible preferred stock, automatic conversion, minimum share price (in usd per share) | $ 1 | |||
Net proceeds from issuance of convertible preferred stock | $ 15,637,032 | $ 15,581,811 | $ 0 | |
Preferred stock, carrying value | $ 15,637,032 | $ 0 | ||
Series B Preferred Stock | ||||
Class of Stock [Line Items] | ||||
Preferred stock, authorized (shares) | 14,500,000 | 0 | ||
Preferred stock, par value (in usd per share) | $ 0.0001 | |||
Issuance of stock/IPO proceeds, net of issuance costs (in shares) | 14,078,647 | |||
Convertible preferred stock, automatic conversion, minimum share price (in usd per share) | $ 1.81 | |||
Net proceeds from issuance of convertible preferred stock | $ 25,394,135 | $ 25,394,135 | $ 0 | |
Preferred stock, carrying value | $ 25,394,135 | $ 0 |
Common stock - Narrative (Detai
Common stock - Narrative (Details) - USD ($) | 1 Months Ended | 10 Months Ended | 12 Months Ended | |
Apr. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2015 | |
Class of Stock [Line Items] | ||||
Common stock, shares authorized (shares) | 61,000,000 | 100,000,000 | ||
Common stock, par value (in usd per share) | $ 0.0001 | $ 0.0001 | ||
Proceeds from sale of restricted common stock to founders | $ 2,321 | $ 0 | ||
Stock issued under Employee Stock Purchase Plan | 0 | |||
Unvested restricted common stock | ||||
Class of Stock [Line Items] | ||||
Restricted common stock, shares sold | 867,314 | 4,553,415 | ||
Restricted common stock, price per share (in usd per share) | $ 0.0004 | |||
Proceeds from sale of restricted common stock to founders | $ 1,950 | |||
Restricted common stock, repurchase period | 90 days | |||
Restricted common stock, repurchase price | $ 0.0004 | |||
Restricted common stock, shares outstanding | 3,218,467 | |||
Restricted common stock, fair value of shares vested | $ 3,620,000 | $ 15,616,000 | ||
Unvested restricted common stock | Vests upon issuance | ||||
Class of Stock [Line Items] | ||||
Restricted common stock, percent vested | 25.00% | |||
Unvested restricted common stock | Vests ratably over four years | ||||
Class of Stock [Line Items] | ||||
Restricted common stock, percent vested | 75.00% | |||
Restricted common stock, vesting period | 4 years |
Common stock - Restricted commo
Common stock - Restricted common stock activity (Details) - Unvested restricted common stock | 12 Months Ended |
Dec. 31, 2015$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |
Beginning balance, non-vested, number of shares | shares | 3,218,590 |
Issued, number of shares | shares | 0 |
Vested, number of shares | shares | (1,016,328) |
Forfeited, number of shares | shares | 0 |
Ending balance, non-vested, number of shares | shares | 2,202,262 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |
Beginning balance, non-vested, weighted average grant date fair value (in usd per share) | $ / shares | $ 0.10 |
Issued, weighted average grant date fair value (in usd per share) | $ / shares | |
Vested, weighted average grant date fair value (in usd per share) | $ / shares | $ 0.10 |
Forfeited, weighted average grant date fair value (in usd per share) | $ / shares | 0 |
Ending balance, non-vested, weighted average grant date fair value (in usd per share) | $ / shares | $ 0.10 |
Common stock - Shares reserved
Common stock - Shares reserved for future issuance (Details) - shares | Dec. 31, 2015 | Dec. 31, 2014 |
Class of Stock [Line Items] | ||
Stock-based compensation awards | 2,031,528 | 1,189,314 |
Employee stock purchase plan | 175,131 | 0 |
Total | 4,408,921 | 11,379,012 |
Series A Preferred Stock | ||
Class of Stock [Line Items] | ||
Convertible Preferred Stock | 0 | 3,683,637 |
Series B Preferred Stock | ||
Class of Stock [Line Items] | ||
Convertible Preferred Stock | 0 | 3,287,471 |
Unvested restricted common stock | ||
Class of Stock [Line Items] | ||
Vesting of restricted common stock | 2,202,262 | 3,218,590 |
Stock-based compensation - Narr
Stock-based compensation - Narrative (Details) - USD ($) | 1 Months Ended | 10 Months Ended | 12 Months Ended | 22 Months Ended | |||
Nov. 30, 2015 | Dec. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2015 | Sep. 30, 2014 | Apr. 30, 2014 | Mar. 31, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock-based compensation expense | $ 1,462,061 | $ 6,597,359 | |||||
Shares granted | 1,020,234 | 994,748 | |||||
Shares granted, weighted-average grant date fair value (in usd per share) | $ 2.20 | $ 8.55 | |||||
Shares exercised | 13,572 | 47,280 | |||||
Shares exercised, weighted average exercise price (in usd per share) | $ 0.60 | $ 8.63 | |||||
Stock options exercised, intrinsic value | $ 51,719 | $ 149,386 | |||||
Unrecognized compensation cost | $ 15,495,100 | $ 15,495,100 | |||||
Unrecognized compensation cost, recognition period | 2 years 4 months 13 days | ||||||
Non-employee Stock Options | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Shares granted to non-employee consultants and members of the Scientific Advisory Board | 155,276 | ||||||
Stock options, vesting period | 4 years | ||||||
Stock options, contractual term | 10 years | ||||||
Stock-based compensation expense | $ 149,000 | $ 517,336 | |||||
Options to purchase common stock | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock options, contractual term | 10 years | ||||||
Options to purchase common stock | Minimum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock options, vesting period | 1 year | ||||||
Options to purchase common stock | Maximum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock options, vesting period | 4 years | ||||||
Performance Shares | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Shares granted | 150,000 | ||||||
Unrecognized compensation cost | $ 1,000,000 | $ 1,000,000 | |||||
Flex Pharma, Inc. 2014 Equity Incentive Plan | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Shares authorized | 2,070,200 | 1,451,087 | 116,754 | ||||
Shares remaining available for grant of stock awards | 206,555 | 206,555 |
Stock-based compensation - Summ
Stock-based compensation - Summary of stock option activity (Details) | 10 Months Ended | 12 Months Ended |
Dec. 31, 2014USD ($)$ / sharesshares | Dec. 31, 2015USD ($)$ / sharesshares | |
Shares | ||
Shares outstanding, beginning balance | shares | 926,832 | |
Shares granted | shares | 1,020,234 | 994,748 |
Shares exercised | shares | (13,572) | (47,280) |
Shares canceled or forfeited | shares | (49,327) | |
Shares outstanding, ending balance | shares | 926,832 | 1,824,973 |
Shares exercisable | shares | 372,508 | |
Shares vested or expected to vest | shares | 1,617,617 | |
Weighted-Average Exercise Price | ||
Shares outstanding, beginning balance, weighted average exercise price (in usd per share) | $ / shares | $ 3.40 | |
Shares granted, weighted average exercise price (in usd per share) | $ / shares | 13.07 | |
Shares exercised, weighted average exercise price (in usd per share) | $ / shares | $ 0.60 | 8.63 |
Shares canceled or forfeited, weighted average exercise price (in usd per share) | $ / shares | 10.69 | |
Shares outstanding, ending balance, weighted average exercise price (in usd per share) | $ / shares | $ 3.40 | 8.34 |
Shares exercisable, weighted average exercise price (in usd per share) | $ / shares | 5.17 | |
Shares vested or expected to vest, weighted average exercise price (in usd per share) | $ / shares | $ 8.05 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | ||
Outstanding, weighted average remaining contractual term | 9 years 8 months 1 day | 8 years 10 months 24 days |
Exercisable, weighted average remaining contractual term | 8 years 9 months | |
Vested or expected to vest, weighted average remaining contractual term | 8 years 9 months 26 days | |
Outstanding, aggregate intrinsic value | $ | $ 6,846,054 | $ 9,073,673 |
Exercisable, aggregate intrinsic value | $ | 2,883,387 | |
Vested or expected to vest, aggregate intrinsic value | $ | $ 8,625,871 |
Stock-based compensation - Sche
Stock-based compensation - Schedule of fair value assumptions (Details) - Options to purchase common stock | 10 Months Ended | 12 Months Ended |
Dec. 31, 2014 | Dec. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Risk-free interest rate, minimum (as a percent) | 1.59% | 1.62% |
Risk-free interest rate, maximum (as a percent) | 2.71% | 2.49% |
Expected dividend yield (as a percent) | 0.00% | 0.00% |
Minimum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected volatility (as a percent) | 75.80% | 72.98% |
Expected term (in years) | 6 years | 5 years 3 months 18 days |
Maximum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected volatility (as a percent) | 76.40% | 74.94% |
Expected term (in years) | 10 years | 10 years |
Stock-based compensation - Su55
Stock-based compensation - Summary of stock-based compensation expense (Details) - USD ($) | 10 Months Ended | 12 Months Ended |
Dec. 31, 2014 | Dec. 31, 2015 | |
Employee Service Share-Based Compensation Allocation of Recognized Period Costs [Line Items] | ||
Stock-based compensation expense | $ 1,462,061 | $ 6,597,359 |
Research and development | ||
Employee Service Share-Based Compensation Allocation of Recognized Period Costs [Line Items] | ||
Stock-based compensation expense | 648,001 | 3,192,063 |
Selling, general and administrative | ||
Employee Service Share-Based Compensation Allocation of Recognized Period Costs [Line Items] | ||
Stock-based compensation expense | $ 814,060 | $ 3,405,296 |
Income taxes - Schedule of effe
Income taxes - Schedule of effective income tax rate reconciliation (Details) | 12 Months Ended | 22 Months Ended |
Dec. 31, 2015 | Dec. 31, 2015 | |
Effective Income Tax Rate Reconciliation, Percent [Abstract] | ||
Federal income tax expense at statutory rate (as a percent) | 35.00% | 35.00% |
State income tax, net of federal benefit (as a percent) | 3.40% | 3.70% |
Permanent differences (as a percent) | (0.20%) | (0.30%) |
Stock compensation (as a percent) | (6.30%) | (5.30%) |
Research credits (as a percent) | 1.80% | 1.20% |
Prior year true ups (as a percent) | 0.40% | |
Change in valuation allowance (as a percent) | (34.10%) | (34.30%) |
Effective tax rate (as a percent) | 0.00% | 0.00% |
Income taxes - Schedule of defe
Income taxes - Schedule of deferred tax assets and liabilities (Details) - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
Deferred tax assets: | ||
U.S. and state net operating loss carryforwards | $ 11,118,289 | $ 2,708,861 |
Accruals and other temporary differences | 510,897 | 23,829 |
Amortization | 33,824 | 36,742 |
Stock-based compensation | 473,801 | 57,120 |
Tax credit carryforward | 671,012 | 87,762 |
Total deferred tax assets | 12,807,823 | 2,914,314 |
Less valuation allowance | (12,688,401) | (2,751,295) |
Deferred tax assets | 119,422 | 163,019 |
Deferred tax liabilities: | ||
Stock-based compensation | (110,366) | (162,779) |
Depreciation | (9,056) | (240) |
Accruals and other temporary differences | 0 | 0 |
Deferred tax liabilities | (119,422) | (163,019) |
Net deferred tax assets | $ 0 | $ 0 |
Income taxes - Narrative (Detai
Income taxes - Narrative (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Income Taxes [Line Items] | ||
Increase (decrease) in valuation allowance | $ 9,900,000 | |
U.S. Federal | ||
Income Taxes [Line Items] | ||
Net operating loss carryforward | 28,200,000 | |
Research and development tax credit carryforwards | 500,000 | |
U.S. State | ||
Income Taxes [Line Items] | ||
Net operating loss carryforward | 24,100,000 | |
Research and development tax credit carryforwards | $ 200,000 | |
U.S. Federal and State | ||
Income Taxes [Line Items] | ||
Operating loss carryforwards that will increase additional paid in capital if used to reduce income taxes payable | $ 100,000 |
Net loss per share (Details)
Net loss per share (Details) - shares | 10 Months Ended | 12 Months Ended |
Dec. 31, 2014 | Dec. 31, 2015 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share | 33,999,290 | 4,027,235 |
Options to purchase common stock | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share | 926,832 | 1,824,973 |
Unvested restricted common stock | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share | 3,218,590 | 2,202,262 |
Series A Preferred Stock | Preferred Stock | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share | 15,775,221 | 0 |
Series B Preferred Stock | Preferred Stock | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share | 14,078,647 | 0 |
Related party (Details)
Related party (Details) - USD ($) $ in Thousands | 10 Months Ended | 12 Months Ended |
Dec. 31, 2014 | Dec. 31, 2015 | |
Affiliated Entity | ||
Related Party Transaction [Line Items] | ||
License fees received | $ 34 | $ 61 |
Quarterly financial informati61
Quarterly financial information (unaudited) (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 10 Months Ended | 12 Months Ended | |||||||
Mar. 31, 2014 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2015 | |
Operating expenses: | |||||||||||
Research and development | $ 30,023 | $ 3,309,055 | $ 3,445,200 | $ 3,190,178 | $ 2,804,946 | $ 1,965,121 | $ 909,123 | $ 1,099,644 | $ 4,003,911 | $ 12,749,379 | |
Selling, general and administrative | 62,700 | 4,621,383 | 4,722,281 | 3,904,403 | 3,216,212 | 1,786,290 | 1,084,240 | 1,092,665 | 4,025,895 | 16,464,279 | |
Total operating expenses | 92,723 | 7,930,438 | 8,167,481 | 7,094,581 | 6,021,158 | 3,751,411 | 1,993,363 | 2,192,309 | 8,029,806 | 29,213,658 | |
Loss from operations | (92,723) | (7,930,438) | (8,167,481) | (7,094,581) | (6,021,158) | (3,751,411) | (1,993,363) | (2,192,309) | (8,029,806) | (29,213,658) | |
Interest income, net | 0 | 37,631 | 14,637 | 16,183 | 3,577 | 9,362 | 6,926 | 2,658 | 18,946 | 72,028 | |
Net loss | $ (92,723) | $ (7,892,807) | $ (8,152,844) | $ (7,078,398) | $ (6,017,581) | $ (3,742,049) | $ (1,986,437) | $ (2,189,651) | $ (8,010,860) | $ (8,010,860) | $ (29,141,630) |
Net loss per share attributable to common stockholders - basic and diluted (in usd per share) | $ (0.07) | $ (0.51) | $ (0.53) | $ (0.47) | $ (0.59) | $ (1.82) | $ (1.11) | $ (1.42) | $ (4.57) | $ (2.08) | |
Weighted-average number of common shares outstanding — basic and diluted | 1,370,125 | 15,551,800 | 15,290,435 | 15,034,764 | 10,179,955 | 2,061,132 | 1,797,664 | 1,539,463 | 1,753,024 | 14,032,916 |
Subsequent events (Details)
Subsequent events (Details) - Subsequent Event - USD ($) | Jan. 21, 2016 | Jan. 20, 2016 |
Subsequent Event [Line Items] | ||
Operating leases, increase in future minimum payments due | $ 320,684 | |
Security Deposit | $ 25,800 | |
Increase in shares of common stock reserved for issuance (in shares) | 717,755 | |
Annual increase in shares of common stock reserved for issuance by percentage of stock outstanding (percent) | 4.00% |