Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2022 | Nov. 04, 2022 | |
Document and Entity Information | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Sep. 30, 2022 | |
Entity File Number | 001-37717 | |
Entity Registrant Name | Senseonics Holdings, Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 47-1210911 | |
Entity Address, Address Line One | 20451 Seneca Meadows Parkway | |
Entity Address, City or Town | Germantown | |
Entity Address, State or Province | MD | |
Entity Address, Postal Zip Code | 20876-7005 | |
City Area Code | 301 | |
Local Phone Number | 515-7260 | |
Title of 12(b) Security | Common Stock, $0.001 par value | |
Trading Symbol | SENS | |
Security Exchange Name | NYSEAMER | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 478,256,348 | |
Entity Central Index Key | 0001616543 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 35,484 | $ 33,461 |
Short term investments, net | 118,715 | 96,445 |
Accounts receivable, net | 103 | 205 |
Accounts receivable, net - related parties | 2,021 | 1,768 |
Inventory, net | 7,257 | 6,316 |
Prepaid expenses and other current assets | 5,714 | 6,218 |
Total current assets | 169,294 | 144,413 |
Option | 101 | 239 |
Deposits and other assets | 3,241 | 1,086 |
Long term investments, net | 8,851 | 51,882 |
Property and equipment, net | 1,183 | 1,308 |
Total assets | 182,670 | 198,928 |
Current liabilities: | ||
Accounts payable | 684 | 1,204 |
Accrued expenses and other current liabilities | 12,674 | 10,667 |
Accrued expenses and other current liabilities- related parties | 671 | 3,597 |
Note payable, current portion, net | 15,223 | |
Derivative liability, current portion | 328 | |
Option, current | 28,068 | |
Term Loans, net | 2,926 | |
Total current liabilities | 57,648 | 18,394 |
Long-term debt and notes payables, net | 53,434 | 59,798 |
Derivative liabilities | 83,794 | 236,291 |
Option | 69,401 | |
Other liabilities | 2,859 | 579 |
Total liabilities | 197,735 | 384,463 |
Commitments and contingencies | ||
Stockholders' equity (deficit): | ||
Common stock, $0.001 par value per share; 900,000,000 shares authorized as of September 30, 2022 and December 31, 2021; 478,211,956 shares and 447,282,263 shares issued and outstanding as of September 30, 2022 and December 31, 2021 | 478 | 447 |
Additional paid-in capital | 806,069 | 765,215 |
Accumulated other comprehensive loss | (1,185) | (212) |
Accumulated deficit | (820,427) | (950,985) |
Total stockholders' equity (deficit) | (15,065) | (185,535) |
Total liabilities and stockholders' equity (deficit) | $ 182,670 | $ 198,928 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parentheticals) - $ / shares | Sep. 30, 2022 | Dec. 31, 2021 |
Class of stock information | ||
Common stock, par value per share (in dollars per share) | $ 0.001 | |
Common stock, shares authorized | 900,000,000 | |
Common stock, shares issued | 478,211,956 | 447,282,263 |
Common stock, shares outstanding | 478,211,956 | 447,282,263 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) | ||||
Revenue, net | $ 126 | $ 276 | $ 555 | $ 1,196 |
Revenue, net - related parties | 4,496 | 3,256 | 10,263 | 8,471 |
Total revenue | 4,622 | 3,532 | 10,818 | 9,667 |
Cost of sales | 3,866 | 4,778 | 8,711 | 9,995 |
Gross profit (loss) | 756 | (1,246) | 2,107 | (328) |
Expenses: | ||||
Research and development expenses | 10,985 | 7,200 | 28,088 | 19,562 |
Selling, general and administrative expenses | 7,340 | 7,585 | 23,785 | 23,347 |
Operating loss | (17,569) | (16,031) | (49,766) | (43,237) |
Other income (expense), net: | ||||
Interest income | 544 | 486 | 878 | 743 |
Gain (Loss) on fair value adjustment of option | (8,592) | 13,556 | 41,333 | (74,848) |
Gain on extinguishment of debt and option | 330 | |||
Interest expense | (4,801) | (4,245) | (13,806) | (12,337) |
Gain (Loss) on change in fair value of derivatives | (28,948) | 50,075 | 152,169 | (255,185) |
Impairment cost | (984) | (488) | (138) | (1,650) |
Other expense | (41) | (439) | (112) | (723) |
Total other income (expense), net | (42,822) | 58,945 | 180,324 | (343,670) |
Net Income (Loss) | (60,391) | 42,914 | 130,558 | (386,907) |
Other comprehensive income (loss) | ||||
Unrealized gain (loss) on marketable securities | (57) | 18 | (973) | 2 |
Total other comprehensive gain (loss) | (57) | 18 | (973) | 2 |
Total comprehensive income (loss) | $ (60,448) | $ 42,932 | $ 129,585 | $ (386,905) |
Basic net income (loss) per common share | $ (0.13) | $ 0.10 | $ 0.28 | $ (0.93) |
Basic weighted-average shares outstanding | 472,475,747 | 445,378,308 | 464,244,736 | 414,128,283 |
Diluted net income (loss) per common share | $ (0.13) | $ 0.08 | $ (0.10) | $ (0.93) |
Diluted weighted-average shares outstanding | 472,475,747 | 581,760,516 | 608,345,713 | 414,128,283 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Changes in Stockholders' Equity (Deficit) - USD ($) shares in Thousands, $ in Thousands | Preferred Stock Series A Preferred Stock | Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Loss | Accumulated Deficit | Total |
Balance at Dec. 31, 2020 | $ 2,811 | $ 266 | $ 504,162 | $ (648,511) | $ (144,083) | |
Balance (in shares) at Dec. 31, 2020 | 265,582 | |||||
Changes in Stockholders' Equity (Deficit) | ||||||
Conversion of preferred stock | $ 54 | 45,512 | 45,566 | |||
Conversion of preferred stock (in shares) | 54,166 | |||||
Issuance of common stock, net | $ 113 | 200,327 | 200,440 | |||
Issuance of common stock (in shares) | 112,571 | |||||
Exercise of stock options and warrants | $ 5 | 4,622 | 4,627 | |||
Exercise of stock options and warrants (in shares) | 5,501 | |||||
Exchange and conversion of convertible notes, net | $ 5 | 6,496 | 6,501 | |||
Exchange and conversion of convertible notes, net (in shares) | 4,925 | |||||
Issuance of common stock for vested RSUs and ESPP purchase | $ 3 | 71 | 74 | |||
Issuance of common stock for vested RSUs and ESPP purchase (in shares) | 2,870 | |||||
Stock-based compensation expense | 7,134 | 7,134 | ||||
Net Income (Loss) | (386,907) | (386,907) | ||||
Other comprehensive income (loss), net of tax | $ 2 | 2 | ||||
Balance at Sep. 30, 2021 | $ 446 | 768,324 | 2 | (1,035,418) | (266,646) | |
Balance (in shares) at Sep. 30, 2021 | 445,615 | |||||
Increase (Decrease) in Temporary Equity | ||||||
Issuance of convertible preferred stock, net | 42,756 | |||||
Conversion of preferred stock | (45,567) | |||||
Balance at Dec. 31, 2020 | $ 2,811 | $ 266 | 504,162 | (648,511) | (144,083) | |
Balance (in shares) at Dec. 31, 2020 | 265,582 | |||||
Changes in Stockholders' Equity (Deficit) | ||||||
Net Income (Loss) | (302,500) | |||||
Balance at Dec. 31, 2021 | $ 447 | 765,215 | (212) | (950,985) | (185,535) | |
Balance (in shares) at Dec. 31, 2021 | 447,282 | |||||
Balance at Jun. 30, 2021 | $ 445 | 765,262 | (16) | (1,078,332) | (312,641) | |
Balance (in shares) at Jun. 30, 2021 | 445,125 | |||||
Changes in Stockholders' Equity (Deficit) | ||||||
Exercise of stock options and warrants | $ 1 | 737 | 738 | |||
Exercise of stock options and warrants (in shares) | 474 | |||||
Issuance of common stock for vested RSUs and ESPP purchase | 24 | 24 | ||||
Issuance of common stock for vested RSUs and ESPP purchase (in shares) | 16 | |||||
Stock-based compensation expense | 2,301 | 2,301 | ||||
Net Income (Loss) | 42,914 | 42,914 | ||||
Other comprehensive income (loss), net of tax | 18 | 18 | ||||
Balance at Sep. 30, 2021 | $ 446 | 768,324 | 2 | (1,035,418) | (266,646) | |
Balance (in shares) at Sep. 30, 2021 | 445,615 | |||||
Balance at Dec. 31, 2021 | $ 447 | 765,215 | (212) | (950,985) | (185,535) | |
Balance (in shares) at Dec. 31, 2021 | 447,282 | |||||
Changes in Stockholders' Equity (Deficit) | ||||||
Issuance of common stock, net | $ 15 | 34,428 | 34,443 | |||
Issuance of common stock (in shares) | 15,161 | |||||
Exercise of stock options and warrants | $ 10 | 941 | 951 | |||
Exercise of stock options and warrants (in shares) | 9,892 | |||||
Issuance of common stock for vested RSUs and ESPP purchase | $ 7 | 125 | 132 | |||
Issuance of common stock for vested RSUs and ESPP purchase (in shares) | 6,970 | |||||
Stock-based compensation expense | 6,543 | 6,543 | ||||
Shares withheld related to net share settlement of equity awards | $ (1) | (1,183) | (1,184) | |||
Shares withheld related to net share settlement of equity awards (in shares) | (1,093) | |||||
Net Income (Loss) | 130,558 | 130,558 | ||||
Other comprehensive income (loss), net of tax | (973) | (973) | ||||
Balance at Sep. 30, 2022 | $ 478 | 806,069 | (1,185) | (820,427) | (15,065) | |
Balance (in shares) at Sep. 30, 2022 | 478,212 | |||||
Balance at Jun. 30, 2022 | $ 465 | 776,640 | (1,128) | (760,036) | 15,941 | |
Balance (in shares) at Jun. 30, 2022 | 465,326 | |||||
Changes in Stockholders' Equity (Deficit) | ||||||
Issuance of common stock, net | $ 12 | 26,427 | 26,439 | |||
Issuance of common stock (in shares) | 12,084 | |||||
Exercise of stock options and warrants | $ 1 | 711 | 712 | |||
Exercise of stock options and warrants (in shares) | 681 | |||||
Issuance of common stock for vested RSUs and ESPP purchase | 69 | 69 | ||||
Issuance of common stock for vested RSUs and ESPP purchase (in shares) | 121 | |||||
Stock-based compensation expense | 2,222 | 2,222 | ||||
Net Income (Loss) | (60,391) | (60,391) | ||||
Other comprehensive income (loss), net of tax | (57) | (57) | ||||
Balance at Sep. 30, 2022 | $ 478 | $ 806,069 | $ (1,185) | $ (820,427) | $ (15,065) | |
Balance (in shares) at Sep. 30, 2022 | 478,212 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Cash flows from operating activities | ||
Net income (loss) | $ 130,558 | $ (386,907) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization expense | 751 | 918 |
Non-cash interest expense (debt discount and deferred costs) | 8,858 | 5,825 |
Change in fair value of derivatives | (152,169) | 255,185 |
(Gain) Loss on fair value adjustment of option | (41,333) | 74,848 |
Gain on extinguishment of debt and option | (330) | |
Impairment of option, net | 138 | 1,650 |
Stock-based compensation expense | 6,543 | 7,134 |
Changes in assets and liabilities: | ||
Accounts receivable | (151) | (686) |
Prepaid expenses and other current assets | 504 | 41 |
Inventory | (941) | (2,597) |
Deposits and other assets | 163 | (30) |
Accounts payable | (519) | (971) |
Accrued expenses and other liabilities | (1,070) | 1,319 |
Accrued interest | (257) | 326 |
Net cash used in operating activities | (48,925) | (44,275) |
Cash flows from investing activities | ||
Capital expenditures | (255) | (75) |
Purchase of marketable securities | (82,807) | (154,918) |
Proceeds from sale and maturity of marketable securities | 102,594 | |
Net cash provided by (used in) investing activities | 19,532 | (154,993) |
Cash flows from financing activities | ||
Issuance of common stock, net | 34,443 | 200,440 |
Proceeds from exercise of stock options, stock warrants and ESPP purchases | 1,083 | 4,701 |
Taxes paid related to net share settlement of equity awards | (1,184) | |
Proceeds from issuance of Masters preferred stock, net | 22,783 | |
Repayment of term loans | (2,926) | (650) |
Net cash provided by financing activities | 31,416 | 227,274 |
Net increase in cash and cash equivalents | 2,023 | 28,006 |
Cash and cash equivalents, at beginning of period | 33,461 | 18,205 |
Cash and cash equivalents, at ending of period | 35,484 | 46,211 |
Supplemental disclosure of cash flow information | ||
Cash paid during the period for interest | 5,137 | 6,149 |
Lease liabilities arising from obtaining right-of-use assets | $ 2,944 | |
Supplemental disclosure of non-cash investing and financing activities | ||
Issuance of common stock converted from preferred shares | 54,166 | |
Issuance of common stock converted from notes payables | $ 4,925 |
Organization and Nature of Oper
Organization and Nature of Operations | 9 Months Ended |
Sep. 30, 2022 | |
Organization and Nature of Operations | |
Organization and Nature of Operations | 1. Organization and Nature of Operations Senseonics Holdings, Inc., a Delaware corporation, is a medical technology company focused on the development and commercialization of long-term, implantable continuous glucose monitoring (“CGM”) systems to improve the lives of people with diabetes by enhancing their ability to manage their disease with relative ease and accuracy. Senseonics, Incorporated is a wholly owned subsidiary of Senseonics Holdings, Inc. and was originally incorporated on October 30, 1996 and commenced operations on January 15, 1997. Senseonics Holdings, Inc. and Senseonics, Incorporated are hereinafter collectively referred to as the “Company” unless otherwise indicated or the context otherwise requires. |
Liquidity and Capital Resources
Liquidity and Capital Resources | 9 Months Ended |
Sep. 30, 2022 | |
Liquidity and Capital Resources | |
Liquidity and Capital Resources | 2. Liquidity and Capital Resources From its founding in 1996 until 2010, the Company has devoted substantially all of its resources to researching various sensor technologies and platforms. Beginning in 2010, the Company narrowed its focus to developing and refining a commercially viable glucose monitoring system. However, to date, the Company has not generated any significant revenue from product sales. The Company has incurred substantial losses and cumulative negative cash flows from operations since its inception in October 1996. The Company has never been profitable from operations, and its net losses were $302.5 million, $175.2 million, and $115.5 million for the years ended December 31, 2021, 2020 and 2019, respectively. As of September 30, 2022, the Company had an accumulated deficit of $820.4 million. To date, the Company has funded its operations principally through the issuance of preferred stock, common stock, convertible notes and debt. As of September 30, 2022, the Company had cash, cash equivalents and marketable securities of $163.0 million. In November 2021, the Company entered into an Open Market Sale Agreement, (the “2021 Sales Agreement”) with Jefferies LLC (“Jefferies”), under which the Company could offer and sell, from time to time, at its sole discretion, shares of its common stock having an aggregate offering price of up to $150.0 million through Jefferies as its sales agent in an “at the market” offering. Jefferies will receive a commission up to 3.0% of the gross proceeds of any common stock sold through Jefferies under the 2021 Sales Agreement. During the nine months ended September 30, 2022, the Company received $34.4 million in net proceeds from the sale of 15,160,899 shares of its common stock under the 2021 Sales Agreement. In November 2019, the Company entered into an Open Market Sale Agreement (the “2019 Sales Agreement”) with Jefferies, under which the Company could offer and sell, from time to time at its sole discretion, shares of its common stock having an aggregate offering price of up to $50.0 million through Jefferies as its sales agent in an “at the market” offering. In June 2021, the Company received $48.4 million in net proceeds from the sale of 12,830,333 shares of its common stock utilizing the full capacity under the 2019 Sales Agreement. On January 21, 2021, the Company entered into an underwriting agreement, which was subsequently amended and restated on the same day (the “Underwriting Agreement”) with H.C. Wainwright & Co., LLC, as representative of the underwriters (the “Underwriters”), to issue and sell 51,948,052 shares of common stock, in an underwritten public offering pursuant to effective registration statements on Form S-3, including a related prospectus and prospectus supplement, in each case filed with the United States Securities and Exchange Commission (“the SEC”) (the “2021 Public Offering”). The price to the public in the 2021 Public Offering was $1.925 per share of common stock. The Underwriters agreed to purchase the shares from the Company pursuant to the Underwriting Agreement at a price of $1.799875 per share and the Company also agreed to reimburse them for customary fees and expenses. The initial closing of the 2021 Public Offering occurred on January 26, 2021. Subsequent to the initial closing, the Underwriters exercised their option to purchase an additional 7,792,207 shares of common stock. Total net proceeds from the 2021 Public Offering were $106.1 million after deducting underwriting discounts and commissions and estimated offering expenses. On January 17, 2021, the Company entered into a Securities Purchase Agreement with certain institutional purchasers (the “Purchasers”), pursuant to which the Company sold to the Purchasers, in a registered direct offering (the “Registered Direct Offering”), an aggregate of 40,000,000 shares (the “Shares”) of common stock, $0.001 par value per share. The Shares were sold at a purchase price of $1.25 per share for aggregate gross proceeds to the Company of $50.0 million, before deducting fees to the placement agent and other estimated offering expenses payable by the Company. The Shares were offered and sold by the Company pursuant to an effective shelf registration statement on Form S-3, which was originally filed with the SEC on November 27, 2019. The net proceeds to the Company from the Registered Direct Offering, after deducting fees and expenses and the estimated offering expenses payable by the Company, were approximately $46.1 million. On November 9, 2020, the Company entered into an Equity Line Agreement (the “Equity Line Agreement”) with Energy Capital, LLC, a Florida limited liability company (“Energy Capital”), which provided that, upon the terms and subject to the conditions and limitations set forth therein, Energy Capital was committed to purchase up to an aggregate of $12.0 million of shares of the Company’s newly designated series B convertible preferred stock (the “Series B Preferred Stock”) at the Company’s request from time to time during the 24-month term of the Equity Line Agreement. Under the Equity Line Agreement, beginning January 21, 2021, subject to the satisfaction of certain conditions, including that the Company have less than $8.0 million of cash, cash equivalents and other available credit (aside from availability under the Equity Line Agreement), the Company had the right, at its sole discretion, to present Energy Capital with a purchase notice (each, a “Regular Purchase Notice”) directing Energy Capital (as principal) to purchase shares of Series B Preferred Stock at a price of $1,000 per share (not to exceed $4.0 million worth of shares) once per month, up to an aggregate of $12.0 million of the Company’s Series B Preferred Stock at a per share price (the “Purchase Price”) equal to $1,000 per share of Series B Preferred Stock, with each share of Series B Preferred Stock initially convertible into common stock, beginning six months after the date of its issuance, at a conversion price of $0.3951 per share, subject to customary anti-dilution adjustments, including in the event of any stock split. The Equity Line Agreement provided that the Company was not permitted to affect any Regular Purchase Notice under the Equity Line Agreement on any date where the closing price of the Company’s common stock on the NYSE American is less than $0.25 without the approval of Energy Capital. In addition, beginning on January 1, 2022, since there had been no sales of the Series B Preferred Stock pursuant to the Equity Line Agreement, Energy Capital had the right, at its sole discretion, by its delivery to the Company of a Regular Purchase Notice, to purchase up to the $12.0 million of Series B Preferred Stock under the Equity Line Agreement at the Purchase Price. On November 7, 2022, Energy Capital exercised in full its right to purchase $12.0 million of Series B Preferred Stock. On August 9, 2020, the Company entered into a financing agreement with the parent company of Ascensia Diabetes Care Holdings AG (“Ascensia”), PHC Holdings Corporation (“PHC”), pursuant to which the Company issued $35.0 million in aggregate principal amount of Senior Secured Convertible Notes due on October 31, 2024 (the “PHC Notes”), to PHC. The Company also issued 2,941,176 shares of common stock to PHC as a financing fee. The Company also has the option to sell and issue PHC up to $15.0 million of convertible preferred stock on or before December 31, 2022, contingent upon obtaining U.S. Food and Drug Administration (“FDA”) approval for the 180-day Eversense product for marketing in the United States before such date. The Company successfully obtained FDA approval in February 2022. The Company has not exercised this option as of September 30, 2022. Additionally, on August 9, 2020, the Company entered into a Stock Purchase Agreement with Masters Special Solutions, LLC and certain affiliates thereof (collectively, “Masters”), pursuant to which the Company issued and sold to Masters 3,000 shares of convertible preferred stock, designated as Series A Preferred Stock (the “Series A Preferred Stock”), at a price of $1,000 per share in an initial closing. Masters also had the option to purchase up to an additional 27,000 shares of Series A Preferred Stock at a price of $1,000 per share in subsequent closings, subject to the terms and conditions of the Stock Purchase Agreement, as amended, through January 11, 2021. In January 2021, Masters and its assignees purchased in aggregate an additional 22,783 shares of Series A Preferred Stock, resulting in additional gross proceeds to the Company of $22.8 million. Each share of Series A Preferred Stock was initially convertible into a number of shares of common stock equal to $1,000 divided by the conversion price of $0.476 per share, subject to customary anti-dilution adjustments, including in the event of any stock split. All shares of Series A Preferred Stock have been converted to common stock. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2022 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | 3. Summary of Significant Accounting Policies Basis of Presentation The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and the instructions to Quarterly Report on Form 10-Q and Article 10 of Regulation S-X. Although the Company considers the disclosures in these unaudited consolidated financial statements to be adequate to make the information presented not misleading, certain information or footnote information normally included in consolidated financial statements prepared in accordance with U.S. GAAP have been condensed or omitted as permitted under the rules and regulations of the SEC. In the opinion of management, all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair statement of financial position at September 30, 2022, and December 31, 2021, results of operations, comprehensive income (loss), and changes in stockholder’s deficit for the three and nine month periods ended September 30, 2022, and 2021 and cash flows for the nine months ended September 30, 2022, and 2021 have been included. The unaudited condensed consolidated financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2021, as filed with the SEC on March 1, 2022. The interim results for September 30, 2022 are not necessarily indicative of the results to be expected for the year ending December 31, 2022, or for any future interim periods. The consolidated financial statements reflect the accounts of Senseonics Holdings, Inc. and its wholly owned operating subsidiary Senseonics, Incorporated. The Company views its operations and manages its business in one segment, glucose monitoring products. 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 in assessing performance. Certain prior year amounts have been reclassified to conform to the current-year presentation. An adjustment has been made to the Consolidated Statements of Operations and Comprehensive Income (Loss) to consolidate the line items Sales and marketing expenses and General and administrative expenses to Selling, general and administrative expenses in order to conform to current year presentation. These reclassifications had no effect on the reported results of operations. Recent Accounting Pronouncements Recently Adopted In August 2020, the FASB issued ASU 2020-06, Debt-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contract in Entity’s Own Equity (Subtopic 815-40) . Not Yet Adopted In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses: Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”) debts with trade receivables. Accordingly, the Company does not expect this to have a significant impact on its consolidated financial statements and related disclosures at this time. The Company will adopt this guidance on the effective date for smaller reporting companies, January 1, 2023. Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the reported amounts of revenue and expenses during the reporting period. In the accompanying unaudited consolidated financial statements, estimates are used for, but not limited to, stock-based compensation, recoverability of long-lived assets, deferred taxes and valuation allowances, derivative assets and liabilities, obsolete inventory, warranty obligations, variable consideration related to revenue, depreciable lives of property and equipment, and accruals for clinical study costs, which are accrued based on estimates of work performed under contract. The Company considered COVID-19 related impacts to its estimates, as appropriate, within its unaudited condensed consolidated financial statements and there may be changes to those estimates in future periods due to the uncertainties surrounding the severity and duration of the COVID-19 pandemic. Actual results could differ from those estimates. Significant Accounting Policies The accounting policies used by the Company in its presentation of interim financial results are consistent with those presented in Note 3 to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. |
Revenue Recognition
Revenue Recognition | 9 Months Ended |
Sep. 30, 2022 | |
Revenue Recognition | |
Revenue Recognition | 4. Revenue Recognition The Company generates product revenue from sales of the Eversense system and related components and supplies to Ascensia, through a collaboration and commercialization agreement (the “Ascensia Commercialization Agreement”), third-party distributors in the European Union and to strategic fulfillment partners in the United States (collectively, the “Customers”), who then resell the products to health care providers and patients. Customers pay the Company for sales, regardless of whether or not the Customers resell the products to health care providers and patients. The Company’s policies for recognizing sales have not changed from those described in our Annual Report on Form 10-K for the year ended December 31, 2021. Revenue by Geographic Region The following table sets forth net revenue derived from the Company’s two primary geographical markets, the United States and outside of the United States, based on the geographic location to which the Company delivers the product, for the three and nine months ended September 30, 2022 and 2021: Three Months Ended Nine Months Ended September 30, 2022 September 30, 2022 % % (Dollars in thousands) Amount of Total Amount of Total Revenue, net: Outside of the United States $ 2,688 58.2 % $ 6,910 63.9 % United States 1,934 41.8 3,908 36.1 Total $ 4,622 100.0 % $ 10,818 100.0 % Three Months Ended Nine Months Ended September 30, 2021 September 30, 2021 % % (Dollars in thousands) Amount of Total Amount of Total Revenue, net: Outside of the United States $ 2,928 82.9 % $ 7,771 80.4 % United States 604 17.1 1,896 19.6 Total $ 3,532 100.0 % $ 9,667 100.0 % Contract Assets Contract assets consist of unbilled receivables from customers and are recorded at net realizable value and relate to the revenue share variable consideration from the Ascensia Commercialization Agreement. Accounts receivable – related parties, net as of September 30, 2022, and December 31, 2021 included unbilled accounts receivable of $1.1 million and $1.8 million, respectively. The Company expects to invoice and collect all unbilled accounts receivable within 12 months. Concentration of Revenue and Customers For the three months ended September 30, 2022 and 2021, the Company derived 97% and 92%, respectively, of its total revenue from one customer, Ascensia. For the nine months ended September 30, 2022 and 2021, the Company derived 95% and 88%, respectively, of its total revenue from one customer, Ascensia. Revenues for these corresponding periods represent sales of sensors, transmitters and miscellaneous Eversense system components. |
Net Income (Loss) per Share
Net Income (Loss) per Share | 9 Months Ended |
Sep. 30, 2022 | |
Net Income (Loss) per Share | |
Net Income (Loss) per Share | 5. Net Income (Loss) per Share Basic net income (loss) per share attributable to common stockholders is calculated by dividing the net income attributable to common stockholders by the weighted-average number of common shares outstanding during the period. Diluted net income (loss) per share is computed using the weighted average number of common shares outstanding during the period and, when dilutive, potential common share equivalents. Potentially dilutive common shares consist of shares issuable from restricted stock units, stock options, warrants and the Company’s convertible notes. Potentially dilutive common shares issuable upon vesting of restricted stock units and exercise of stock options and warrants are determined using the average share price for each period under the treasury stock method. Potentially dilutive common shares issuable upon conversion of the Company’s convertible notes are determined using the if converted method. The if-converted method assumes conversion of convertible securities at the beginning of the reporting period. Interest expense, dividends, and the changes in fair value measurement recognized during the period are added back to the numerator. The denominator includes the common shares issuable upon conversion of convertible securities. In periods of net loss, all potentially dilutive common shares are excluded from the computation of the diluted net loss per share for those periods, as the effect would be anti-dilutive. The following table sets forth the computation of basic and diluted net income per share for the periods shown: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Net income (loss) (60,391) 42,914 130,558 (386,907) Impact of conversion of dilutive securities — 1,385 (188,563) — Dilutive Net income (loss) (60,391) 44,299 (58,005) (386,907) Net income (loss) per share Basic (0.13) 0.10 0.28 (0.93) Diluted (0.13) 0.08 (0.10) (0.93) Basic weighted average shares outstanding 472,475,747 445,378,308 464,244,736 414,128,283 Dilutive potential common stock outstanding Stock-based awards — 15,520,414 6,499,671 — 2023 Notes — 4,617,646 4,617,646 — 2025 Notes — 39,689,142 39,211,358 — PHC Notes — 65,348,857 67,625,174 — Energy Capital Option — — 23,335,635 — Warrants — 11,206,148 2,811,493 — Diluted weighted average shares outstanding 472,475,747 581,760,516 608,345,713 414,128,283 Outstanding anti-dilutive securities not included in the diluted net income per share calculations were as follows: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Stock-based awards 24,940,972 1,949,958 10,426,560 28,502,846 2023 Notes 4,617,646 — — 4,617,646 2025 Notes 39,211,358 — — 39,689,142 PHC Notes 68,322,952 — — 65,757,177 PHC Option 31,512,605 — 22,717,076 — Energy Capital Option 30,372,058 — — Warrants 3,177,821 116,581 427,821 13,177,822 Total anti-dilutive shares outstanding 202,155,412 2,066,539 33,571,457 151,744,633 |
Marketable Securities
Marketable Securities | 9 Months Ended |
Sep. 30, 2022 | |
Marketable Securities | |
Marketable Securities | 6. Marketable Securities Marketable securities available for sale, were as follows (in thousands): September 30, 2022 Gross Gross Estimated Amortized Unrealized Unrealized Market Cost Gains Losses Value Commercial Paper $ 32,614 — — $ 32,614 Corporate debt securities $ 37,209 — (425) $ 36,784 Asset backed securities $ 13,979 — (130) $ 13,849 Government and agency securities $ 44,949 — (630) $ 44,319 Total $ 128,751 $ — $ (1,185) $ 127,566 December 31, 2021 Gross Gross Estimated Amortized Unrealized Unrealized Market Cost Gains Losses Value Commercial Paper $ 57,369 — — $ 57,369 Corporate debt securities $ 39,825 — (77) $ 39,748 Asset backed securities $ 26,736 — (29) $ 26,707 Government and agency securities $ 24,609 — (106) $ 24,503 Total $ 148,539 $ — $ (212) $ 148,327 The following are the scheduled maturities as of September 30, 2022 (in thousands): 2022 (remaining three months) $ 29,625 2023 90,175 2024 2,221 2025 6,730 Total $ 128,751 The Company periodically reviews its portfolio of debt securities to determine if any investment is impaired due to credit loss or other potential valuation concerns. For debt securities where the fair value of the investment is less than the amortized cost basis, the Company assesses at the individual security level, for various quantitative factors including, but not limited to, the nature of the investments, changes in credit ratings, interest rate fluctuations, industry analyst reports, and the severity of impairment. Unrealized losses on available-for-sale securities at September 30, 2022 were not significant and were primarily due to changes in interest rates and not due to increased credit risk associated with specific securities. The Company does not intend to sell these impaired investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost bases, which may be at maturity. |
Inventory, net
Inventory, net | 9 Months Ended |
Sep. 30, 2022 | |
Inventory, net | |
Inventory, net | 7. Inventory, net Inventory, net of reserves, consisted of the following (in thousands): September 30, December 31, 2022 2021 Finished goods $ 1,428 $ 1,012 Work-in-process 4,306 3,770 Raw materials 1,523 1,534 Total $ 7,257 $ 6,316 The Company charged $0.5 million and $1.1 million, respectively, to cost of sales for the three and nine months ended September 30, 2022 and $1.8 million to cost of sales for the three and nine months ended September 30, 2021 to reduce the value of inventory for items that are potentially obsolete due to expiry, in excess of product demand, or to adjust costs to their net realizable value. |
Prepaid Expenses and Other Curr
Prepaid Expenses and Other Current Assets, and Deposits and other assets | 9 Months Ended |
Sep. 30, 2022 | |
Prepaid Expenses and Other Current Assets, and Deposits and other assets | |
Prepaid Expenses and Other Current Assets, and Deposits and other assets | 8. Prepaid Expenses and Other Current Assets, and Deposits and other assets Prepaid expenses and other current assets consisted of the following (in thousands): September 30, December 31, 2022 2021 Contract manufacturing⁽¹⁾ $ 4,028 $ 5,036 Insurance 506 74 Clinical and Preclinical 472 142 Interest receivable 369 443 Research and development 9 39 Accounting and Audit 148 — Rent and utilities 108 105 IT and software 21 225 Sales and Marketing 17 98 Other 36 56 Total prepaid expenses and other current assets $ 5,714 $ 6,218 (1) Includes deposits to contract manufacturers for manufacturing process . Deposits and other assets as of September 30, 2022 and December 31, 2021, were $3.2 million and $1.1 million, respectively. As of September 30, 2022, deposits and other assets is mainly comprised of $3.1 million for our right-of-use asset related to our operating lease of 33,000 square feet of research and office space for our corporate headquarters. In June 2022, the Company extended our lease for an additional five-year term. We recorded a modification to our right-of-use asset for the right-to-use the underlying asset for the additional lease term. |
Accrued Expenses, Other Current
Accrued Expenses, Other Current Liabilities, and Other Liabilities | 9 Months Ended |
Sep. 30, 2022 | |
Accrued Expenses, Other Current Liabilities, and Other Liabilities | |
Accrued Expenses, Other Current Liabilities, and Other Liabilities | 9. Accrued Expenses, Other Current Liabilities, and Other Liabilities Accrued expenses and other current liabilities consisted of the following (in thousands): September 30, December 31, 2022 2021 Compensation and benefits $ 3,462 $ 3,484 Research and development 3,417 2,145 Interest on notes payable 1,887 2,144 Sales and marketing services 155 1,962 Product warranty and replacement obligations 661 1,697 Professional and administration services 1,334 1,011 Contract manufacturing 1,675 914 Operating lease 730 904 Other 24 3 Total accrued expenses and other current liabilities $ 13,345 $ 14,264 Other liabilities as of September 30, 2022 and December 31, 2021, were $2.9 million and $0.6 million, respectively. Other liabilities is comprised of the non-current portion of our operating lease liability for our corporate headquarters. In June 2022, the Company extended our lease for an additional five-year term. We recorded a modification to the lease liability upon renewal to reflect our obligation to make the additional lease payments. The current portion of our operating lease liability is included in the line-item accrued expenses and other current liabilities on our balance sheet. As of September 30, 2022 and December 31, 2021, the current portion of the operating lease liability was $0.7 million and $0.9 million, respectively. |
Product Warranty Obligations
Product Warranty Obligations | 9 Months Ended |
Sep. 30, 2022 | |
Product Warranty Obligations | |
Product Warranty Obligations | 10. Product Warranty Obligations The Company provides a warranty of one year on its smart transmitters. Additionally, the Company may also replace Eversense system components that do not function in accordance with the product specifications. Estimated replacement costs are recorded at the time of shipment as a charge to cost of sales in the consolidated statement of operations and are developed by analyzing product performance data and historical replacement experience, including comparing actual replacements to revenue. At each of September 30, 2022, and December 31, 2021, the warranty reserve was $0.7 million, respectively. The following table provides a reconciliation of the change in estimated warranty liabilities for the nine months ended September 30, 2022 and for the twelve months ended December 31, 2021 (in thousands): September 30, December 31, 2022 2021 Balance at beginning of the period $ 723 $ 646 Provision for warranties during the period (53) 781 Settlements made during the period (8) (704) Balance at end of the period $ 662 $ 723 |
Notes Payable, Preferred Stock
Notes Payable, Preferred Stock and Stock Purchase Warrants | 9 Months Ended |
Sep. 30, 2022 | |
Notes Payable, Preferred Stock and Stock Purchase Warrants | |
Notes Payable, Preferred Stock and Stock Purchase Warrants | 11. Notes Payable, Preferred Stock and Stock Purchase Warrants Term Loans PPP Loan On April 22, 2020, the Company received $5.8 million in loan funding from the PPP pursuant to the CARES Act, as amended by the Flexibility Act, and administered by the Small Business Administration (“SBA”). The unsecured loan (the “PPP Loan”) was evidenced by the PPP Note dated April 21, 2020 (the “PPP Note”) in the principal amount of $5.8 million with Silicon Valley Bank (“SVB”). Under the terms of the PPP Note and the PPP Loan, interest accrued on the outstanding principal at a rate of 1.0% per annum. The term of the PPP Note was two years . In April 2022, the Company repaid the outstanding principal and accrued interest in full. Convertible Preferred Stock and Warrants On November 9, 2020, the Company entered into the Equity Line Agreement with Energy Capital, which provides that, upon the terms and subject to the conditions and limitations set forth therein, Energy Capital is committed to purchase up to an aggregate of $12.0 million of shares of the Company’s Series B Preferred Stock at the Company’s request from time to time during the 24-month term of the Equity Line Agreement. Under the Equity Line Agreement, beginning January 21, 2021, subject to the satisfaction of certain conditions, including the Company having less than $8 million of cash, cash equivalents and other available credit (aside from availability under the Equity Line Agreement), the Company has the right, at sole discretion, to present Energy Capital with a Regular Purchase Notice directing Energy Capital (as principal) to purchase shares of Series B Preferred Stock at a price of $1,000 per share (not to exceed $4.0 million worth of shares) once per month, up to an aggregate of $12.0 million of the Company’s Series B Preferred Stock at the Purchase Price equal to $1,000 per share of Series B Preferred Stock, with each share of Series B Preferred Stock initially convertible into common stock, beginning six months after the date of its issuance, at a conversion price of $0.3951 per share, subject to customary anti-dilution adjustments, including in the event of any stock split. The Equity Line Agreement provides that the Company shall not affect any Regular Purchase Notice under the Equity Line Agreement on any date where the closing price of the Company’s common stock on the NYSE American is less than $0.25 without the approval of Energy Capital. The Company accounted for the Equity Line Agreement as a put/call option (the “Energy Capital Option”). This put/call option is classified as a liability in accordance with ASC 480, Distinguishing liabilities from equity, on the Company’s balance sheet and was recorded at the estimated fair value of $4.2 million upon issuance. The put/call option is required to be remeasured to fair value at each reporting period with the change recorded in change in fair value of derivatives that is a component of other income (expense). In connection with the execution of the Equity Line Agreement, the Company incurred $7.6 million in debt issuance costs in fiscal year 2020. The fair value of the Energy Capital Option as of September 30, 2022 and December 31, 2021 was $ 28.1 million and $69.4 million, respectively. Concurrently with entry into the Equity Line Agreement, the Company issued a warrant to Energy Capital, exercisable beginning on May 9, 2021, to purchase up to 10,000,000 shares of common stock at an exercise price of $0.3951 per share (the “Warrant”). The Warrant was exercised on a net basis in February 2022 and Energy Capital received 8,917,535 shares of common stock upon the net exercise of the Warrants. On August 9, 2020, the Company entered into a Stock Purchase Agreement with Masters, pursuant to which the Company issued and sold Masters 3,000 shares of Series A Preferred Stock, at a price of $1,000 per share in an initial closing. Masters also had the option to purchase up to an additional 27,000 shares of Series A Preferred Stock at a price of $1,000 per share in subsequent closings, subject to the terms and conditions of the Stock Purchase Agreement, as amended, through January 11, 2021. In January 2021, Masters and its assignees purchased in aggregate an additional 22,783 shares of Series A Preferred Stock, resulting in additional gross proceeds of $22.8 million. Each share of Series A Preferred Stock was initially convertible into a number of shares of common stock equal to $1,000 divided by the conversion price of $0.476 per share, subject to customary anti-dilution adjustments, including in the event of any stock split. All 25,783 shares of Series A Preferred Stock have been converted to shares of common stock. Masters’ option to purchase the remaining unissued shares of Series A Preferred Stock expired on January 11, 2021, resulting in a gain on extinguishment of $3.5 million. Convertible Notes PHC Notes On August 9, 2020, the Company entered into a Note Purchase Agreement (the “Note Purchase Agreement”) with PHC, as the purchaser (together with the other purchasers from time to time party thereto, the “Note Purchasers”) and Alter Domus (US) LLC, as collateral agent. Pursuant to the Note Purchase Agreement, the Company borrowed $35.0 million in aggregate principal through the issuance and sale of the PHC Notes on August 14, 2020 (the “Closing Date”). The Company also issued 2,941,176 shares of its common stock, $0.001 par value per share to PHC as a financing fee (the “Financing Fee Shares”) on the Closing Date. The Financing Fee Shares are accounted for as debt discount in the amount of $1.5 million. The PHC Notes are senior secured obligations of the Company and will be guaranteed on a senior secured basis by the Company’s wholly owned subsidiary, Senseonics, Incorporated. Interest at the initial annual rate of 9.5% is payable semi-annually in cash or, at the Company’s option, payment in kind. The interest rate decreased to 8.0% in April 2022 as a result of the Company having obtained FDA approval for the 180-day Eversense E3 system for marketing in the United States. The maturity date for the PHC Notes is October 31, 2024 (the “Maturity Date”). The obligations under the PHC Notes are secured by substantially all of the Company’s and its subsidiary’s assets. The Note Purchasers are entitled to convert the PHC Notes to common stock at a conversion rate of 1,867.4136 shares per $1,000 principal amount of the PHC Notes (including any interest added thereto as payment in kind), equivalent to a conversion price of approximately $0.54 per share, subject to specified anti-dilution adjustments, including adjustments for the Company’s issuance of equity securities on or prior to April 30, 2022 below the conversion price. In addition, following a notice of redemption or certain corporate events that occur prior to the maturity date, the Company will, in certain circumstances, increase the conversion rate for a holder who elects to convert its PHC Notes in connection with such notice of redemption or corporate event. In certain circumstances, the Company will be required to pay cash in lieu of delivering make whole shares unless the Company obtains stockholder approval to issue such shares. Subject to specified conditions, on or after October 31, 2022, the PHC Notes are redeemable by the Company if the closing sale price of the common stock exceeds 275% of the conversion price for a specified period of time and subject to certain conditions upon 10 days prior written notice at a cash redemption price equal to the then outstanding principal amount (including any payment in kind interest which has been added to such amount), plus any accrued but unpaid interest. On or after October 31, 2023, the PHC Notes are redeemable by the Company upon 10 days prior written notice at a cash redemption price equal to the then outstanding principal amount (including any payment in kind interest which has been added to such amount), plus any accrued but unpaid interest, plus a call premium of 130% if redeemed at least six months prior to the Maturity Date or a call premium of 125% if redeemed within six months of the Maturity Date. The Note Purchase Agreement contains customary terms and covenants, including financial covenants, such as operating within an approved budget and achieving minimum revenue and liquidity targets, and negative covenants, such as limitations on indebtedness, liens, mergers, asset transfers, certain investing activities and other matters customarily restricted in such agreements. Most of these restrictions are subject to certain minimum thresholds and exceptions. The Note Purchase Agreement also contains customary events of default, after which the PHC Notes become due and payable immediately, including defaults related to payment compliance, material inaccuracy of representations and warranties, covenant compliance, material adverse changes, bankruptcy and insolvency proceedings, cross defaults to certain other agreements, judgments against the Company, change of control or delisting events, termination of any guaranty, governmental approvals, and lien priority. The Company also has the option to sell and issue PHC up to $15.0 million of convertible preferred stock on or before December 31, 2022 (the “PHC Option”), which was initially contingent upon obtaining FDA approval for the 180-day Eversense product for marketing in the United States before such date, and which approval the Company successfully obtained in February 2022. The PHC Option represents a freestanding financial instrument and is recognized as an asset in the Company’s consolidated balance sheets at fair value on the date of issuance and subject to impairment testing in each reporting period prior to the options exercise or expiration. The Company acknowledges that while the PHC Option is subject to impairment testing, there is no explicit guidance regarding how impairment should be assessed and measured for the PHC Option. As such, the measurement alternative in ASC Topic 321, Investments—Equity Securities, for equity securities without readily determinable fair values can be applied by analogy to assess and measure The Note Purchase Agreement also contained several provisions requiring bifurcation as a separate derivative liability including an embedded conversion feature, mandatory prepayment upon event of default that constitutes a breach of the minimum revenue financial covenant, optional redemption upon an event of default, change in interest rate after PMA approval and default interest upon an event of default. On the date of issuance, the Company recorded the fair value of the embedded features in the amount of $25.8 million as a derivative liability in the Company’s consolidated balance sheets in accordance with ASC Topic 815, Derivatives and Hedging. The derivative is adjusted to fair value at each reporting period, with the change in the fair value recorded in change in fair value of derivatives that is a component of other income (expense) in the Company’s consolidated statement of operations and comprehensive loss. The fair value of the derivative at September 30, 2022 and December 31, 2021 was $63.8 million and $149.1 million, respectively. In connection with the issuance of the Note Purchase Agreement, the Company incurred $2.9 million in debt issuance costs and debt discounts. The associated debt issuance costs were recorded as a contra liability in the amount of $1.4 million and are deferred and amortized as additional interest expense over the term of the notes. conversions of PHC Notes since inception of the Note Purchase Agreement. 2025 Notes In July 2019, the Company issued $82.0 million in aggregate principal amount of senior convertible notes that will mature on January 15, 2025 (the “2025 Notes”), unless earlier repurchased or converted. The 2025 Notes are convertible, at the option of the holders, into shares of the Company’s common stock, at an initial conversion rate of 757.5758 shares per $1,000 principal amount of the 2025 Notes (equivalent to an initial conversion price of approximately $1.32 per share). The 2025 Notes also contained an embedded conversion option requiring bifurcation as a separate derivative liability, along with the fundamental change make-whole provision and the cash settled fundamental make-whole shares provision. The derivative is adjusted to fair value at each reporting period, with the change in the fair value recorded to other income (expense) in the Company’s consolidated statement of operations and comprehensive In connection with the Exchange on April 24, 2020, $24.0 million aggregate principal of the Company’s outstanding 2025 Notes held by Highbridge Capital Management, LLC (“Highbridge”) were exchanged for $15.7 million of Second Lien Notes (the “Second Lien Notes”), (i) 11,026,086 shares of common stock, (ii) warrants to purchase up to 4,500,000 shares of common stock at an exercise price of $0.66 per share, and (iii) $0.3 million in accrued and unpaid interest on the 2025 Notes being exchanged (the “Exchange”). This transaction modified the original 2025 Notes outstanding with Highbridge and resulted in $13.2 million of deferred issuance fees and debt discounts associated with the exchanged 2025 Notes being transferred as a discount to the Second Lien Notes. As of December 31, 2021, there were conversions of $6.5 million of outstanding principal amount of the 2025 notes for 4,924,998 shares of common stock. 2023 Notes In the first quarter of 2018, the Company issued $53.0 million in aggregate principal amount of senior convertible notes due February 1, 2023 (the “2023 Notes”). In July 2019, the Company used the net proceeds from the issuance of the 2025 Notes to repurchase $37.0 million aggregate principal amount of the outstanding 2023 Notes. Each $1,000 of principal of the 2023 Notes is initially convertible into 294.1176 shares of the Company’s common stock, which is equivalent to an initial conversion price of approximately $3.40 per share, subject to adjustment upon the occurrence of specified events. The Company bifurcated the embedded conversion option, along with the interest make-whole provision and make-whole fundamental change provision, and in January 2018 recorded the embedded features as a debt discount and derivative liability in the Company’s consolidated balance sheets at its initial fair value of $17.3 million. Additionally, the Company incurred transaction costs of $2.2 million. The debt discount and transaction costs are being amortized to interest expense over the term of the 2023 Notes at an effective interest rate of 9.30%. The derivative is adjusted to fair value at each reporting period, with the change in the fair value recorded to other income (expense) in the Company’s consolidated statement of operations and comprehensive loss. The fair value of the derivative at September 30, 2022 and December 31, 2021 was $0.3 million and $5.8 million, respectively. There were no conversions of 2023 Notes during the nine months ended September 30, 2022. As the 2023 Notes have a maturity date of February 1, 2023, they are classified as other current liability on the Company’s consolidated balance sheet at September 30, 2022. The following carrying amounts were outstanding under the Company’s notes payable as of September 30, 2022 and December 31, 2021 (in thousands): September 30, 2022 Principal ($) Debt Discount ($) Issuance Costs ($) Carrying Amount ($) 2023 Notes 15,700 (477) - 15,223 2025 Notes 51,199 (16,500) (276) 34,423 PHC Notes 35,000 (15,068) (921) 19,011 December 31, 2021 Principal ($) Debt Discount ($) Issuance Costs ($) Carrying Amount ($) 2023 Notes 15,700 (1,499) - 14,201 2025 Notes 51,199 (20,535) (344) 30,320 PHC Notes 35,000 (18,587) (1,136) 15,277 PPP Loan 2,926 - - 2,926 Interest expense related to the notes payable for the nine months ended September 30, 2022 and 2021 was as follows (dollars in thousands): Nine Months Ended September 30, 2022 Interest Rate Interest ($) Debt Discount and Fees ($) Issuance Costs ($) Loss on Extinguishment ($) Total Interest Expense ($) 2023 Notes 5.25% 618 1,022 - - 1,640 2025 Notes 5.25% 2,002 4,035 68 - 6,104 PHC Notes 8.00% 2,319 3,519 215 - 6,053 PPP Loan 1.00% 6 - - - 6 Total 4,945 8,576 283 - 13,803 Nine Months Ended September 30, 2021 Interest Rate Interest ($) Debt Discount and Fees ($) Issuance Costs ($) Loss on Extinguishment ($) Total Interest Expense ($) 2023 Notes 5.25% 618 931 - - 1,549 2025 Notes 5.25% 2,044 3,362 56 3,183 8,645 PHC Notes 9.50% 2,456 2,627 161 - 5,244 PPP Loan 1.00% 44 - - - 44 Total 5,162 6,920 217 3,183 15,482 The following are the scheduled maturities of the Company’s notes payable as of September 30, 2022 (in thousands): 2022 (remaining three months) $ — 2023 15,700 2024 35,000 2025 51,199 Total $ 101,899 |
Stockholders' Equity (Deficit)
Stockholders' Equity (Deficit) | 9 Months Ended |
Sep. 30, 2022 | |
Stockholders' Equity (Deficit) | |
Stockholders' Equity (Deficit) | 12. Stockholders’ Equity (Deficit) In November 2021, the Company entered into the 2021 Sales Agreement with Jefferies, under which the Company could offer and sell, from time to time, at its sole discretion, shares of its common stock having an aggregate offering price of up to $150.0 million through Jefferies as the sales agent in an “at the market” offering. Jefferies will receive a commission up to 3.0% of the gross proceeds of any common stock sold through Jefferies under the 2021 Sales Agreement. During the nine months ended September 30, 2022, the Company received $34.4 million in net proceeds from the sale of 15,160,899 shares of its common stock under the 2021 Sales Agreement. In November 2019, the Company entered into the 2019 Sales Agreement with Jefferies LLC which allowed the Company to issue and sell up to $50.0 million in gross proceeds of its common stock. In June 2021, the Company sold 12,830,333 shares of common stock under the 2019 Sales Agreement, resulting in gross proceeds of $48.4 million. During the nine months ended September 30, 2021, in addition to the shares sold under the 2019 Sales Agreement, the Company sold 99,740,259 shares of common stock, of which 59,740,259 shares of common stock were sold in the 2021 Public Offering and 40,000,000 shares of common stock were sold in the Registered Direct Offering. For additional information on the 2021 Public Offering and the Registered Direct Offering, see Note 2—Liquidity and Capital Resources. |
Stock-Based Compensation
Stock-Based Compensation | 9 Months Ended |
Sep. 30, 2022 | |
Stock-Based Compensation | |
Stock-Based Compensation | 13. Stock-Based Compensation 2015 Plan In December 2015, the Company adopted the 2015 Equity Incentive Plan (the “2015 Plan”), under which incentive stock options, non-qualified stock options and restricted stock units may be granted to the Company’s employees and certain other persons, such as officers and directors, in accordance with the 2015 Plan provisions. In February 2016, the Company’s Board of Directors adopted, and the Company’s stockholders approved, an Amended and Restated 2015 Equity Incentive Plan (the “Amended and Restated 2015 Plan”), which became effective on February 20, 2016. The Company’s Board of Directors may terminate the Amended and Restated 2015 Plan at any time. Options granted under the Amended and Restated 2015 Plan expire ten years after the date of grant. Pursuant to the Amended and Restated 2015 Plan, the number of shares of the Company’s common stock reserved for issuance automatically increases on January 1 of each year, ending on January 1, 2026, by 3.5% of the total number of shares of its common stock outstanding on December 31 of the preceding calendar year, or a lesser number of shares as may be determined by its Board of Directors. As of September 30, 2022, 20,390,940 shares remained available for grant under the Amended and Restated 2015 Plan. Inducement Plan On May 30, 2019, the Company adopted the Senseonics Holdings, Inc. Inducement Plan (the “Inducement Plan”), pursuant to which the Company reserved 1,800,000 shares of the Company’s common stock for issuance. The only persons eligible to receive grants of awards under the Inducement Plan are individuals who satisfy the standards for inducement grants in accordance with NYSE American Company Guide Section 711(a), including individuals who were not previously an employee or director of the Company, or following a bona fide period of non-employment, as an inducement material to such persons entering into employment with the Company. An “Award” is any right to receive the Company’s common stock pursuant to the Inducement Plan, consisting of non-statutory options, restricted stock unit awards and other equity incentive awards. As of September 30, 2022, 701,071 shares remained available for grant under the Inducement Plan. 2016 Employee Stock Purchase Plan In February 2016, the Company adopted the 2016 Employee Stock Purchase Plan, (the “2016 ESPP”). The 2016 ESPP became effective on March 17, 2016. The maximum number of shares of common stock that may be issued under the 2016 ESPP was initially 800,000 shares and automatically increases on January 1 of each year, ending on and including January 1, 2026, by 1.0% of the total number of shares of common stock outstanding on December 31 of the preceding calendar year; provided, however, the Board of Directors may act prior to the first day of any calendar year to provide that there will be no January 1 increase in the share reserve for such calendar year or that the increase in the share reserve for such calendar year will be a lesser number of shares of common stock. At September 30, 2022 there were 13,050,523 shares of common stock available for issuance under the 2016 ESPP. For the nine months ended September 30, 2022, there were purchases of 93,053 shares of common stock pursuant to this plan. The 2016 ESPP permits participants to purchase shares of the Company’s common stock through payroll deductions of up to 15% of their earnings. Unless otherwise determined by the administrator, the purchase price of the shares will be 85% of the lower of the fair market value of common stock on the first day of an offering or on the date of purchase. Participants may end their participation at any time and deductions not yet used in a purchase are refundable upon employment termination. The Company initiated its first 2016 ESPP offering period on August 1, 2019 and new offering periods occur every six months thereafter, each consisting of two purchase periods of six months in duration ending on or about January 31 st st The 2016 ESPP is considered compensatory for financial reporting purposes. 1997 Plan On May 8, 1997, the Company adopted the 1997 Stock Option Plan (the “1997 Plan”), under which incentive stock options, non-qualified stock options, and restricted stock awards may be granted to the Company’s employees and certain other persons in accordance with the 1997 Plan provisions. Approximately 1,223,273 shares of the Company’s common stock underlying options have vested under the 1997 Plan. Upon the effectiveness of the 2015 Plan, the Company no longer grants any awards under the 1997 Plan. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value Measurements | |
Fair Value Measurements | 14. Fair Value Measurements The following table represents the fair value hierarchy of the Company’s financial assets and liabilities measured at fair value on a recurring basis at September 30, 2022 and December 31, 2021 (in thousands): September 30, 2022 Total Level 1 Level 2 Level 3 Assets Money market funds⁽¹⁾ $ 33,610 $ 33,610 — — Commercial paper 32,614 — 32,614 — Corporate debt securities 36,784 — 36,784 — Asset backed securities 13,849 — 13,849 — Government and agency securities 44,319 37,403 6,916 — PHC Option 101 — — 101 Liabilities Energy Capital Option $ 28,068 $ — — 28,068 Embedded features of the 2023 Notes 328 — 328 — Embedded features of the PHC Notes 63,847 — — 63,847 Embedded features of the 2025 Notes 19,947 — 19,947 — December 31, 2021 Total Level 1 Level 2 Level 3 Assets Money market funds⁽¹⁾ $ 29,197 $ 29,197 — — Commercial paper 57,369 — 57,369 — Corporate debt securities 39,748 — 39,748 — Asset backed securities 26,707 — 26,707 — Government and agency securities 24,503 19,957 4,546 — PHC Option 239 — — 239 Liabilities Energy Capital Option $ 69,401 $ — — 69,401 Embedded features of the 2023 Notes 5,817 — — 5,817 Embedded features of the PHC Notes 149,058 — — 149,058 Embedded features of the 2025 Notes 81,417 — 81,417 — (1) Classified as cash and cash equivalents due to their short-term maturity The following table provides a reconciliation of the beginning and ending net balances of items measured at fair value on a recurring basis that used significant unobservable inputs (Level 3) (in thousands): Level 3 Instruments December 31, 2021 $ 224,037 Gain on fair value adjustment of option (41,333) Gain on change in fair value of derivatives (85,211) Financial asset (gain) impairment cost, net 138 Change in fair value hierarchy classification (5,817) September 30, 2022 $ 91,814 The recurring Level 3 fair value measurements of the embedded features of the notes payable and preferred stock, include the following significant unobservable inputs at September 30, 2022: PHC Notes PHC Option Energy Capital Option Unobservable Inputs Assumptions Assumptions Assumptions Stock price volatility 110.0 % 104.0 % 88.0 % Probabilities of conversion provisions 5.0 - 10.0 % 5.0 - 10.0 % 5.0 - 10.0 % Time period until maturity (yrs) 2.09 0.25 0.00 - 0.11 Dividend yield — % — % — % |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2022 | |
Income Taxes | |
Income Taxes | 15. Income Taxes The Company has no t recorded any tax provision or benefit for the nine months ended September 30, 2022 or September 30, 2021. The Company has provided a valuation allowance for the full amount of its net deferred tax assets since realization of any future benefit from deductible temporary differences, NOL carryforwards and research and development credits is not more-likely-than-not to be realized at September 30, 2022 and December 31, 2021. On March 27, 2020, Congress enacted the CARES Act, as amended by the Flexibility Act, to provide certain relief as a result of the COVID-19 pandemic. The enactment of the CARES Act did not result in any material adjustments to the Company’s income tax provision or net deferred tax assets for the nine months ended September 30, 2022. |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2022 | |
Related Party Transactions | |
Related Party Transactions | 16. Related Party Transactions Ascensia, through the ownership interests of its parent company, PHC, has a noncontrolling ownership interest in the Company. Ascensia also has representation on the Company’s board of directors. . The amount due from Ascensia as of September 30, 2022 and December 31, 2021 was $2.0 million and $1.8 million, respectively. The amount due to Ascensia as of September 30, 2022 and December 31, 2021 was $0.7 million and $2.5 million, respectively . |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2022 | |
Subsequent Events | |
Subsequent Events | 17. Subsequent Events The Company has evaluated all subsequent events through the filing date of this Form 10-Q with the SEC, to ensure that this filing includes appropriate disclosure of events both recognized in the financial statements as of September 30, 2022, and events which occurred subsequently but were not recognized in the financial statements. Except as described below there were no other subsequent events which required recognition, adjustment to or disclosure in the financial statements. On November 7, 2022, Energy Capital, LLC delivered a Regular Purchase Notice pursuant to the Equity Line Agreement, exercising their right to purchase $12.0 million of Series B Preferred Stock, having a conversion price of $0.3951 per share. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2022 | |
Summary of Significant Accounting Policies | |
Basis of Presentation | Basis of Presentation The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and the instructions to Quarterly Report on Form 10-Q and Article 10 of Regulation S-X. Although the Company considers the disclosures in these unaudited consolidated financial statements to be adequate to make the information presented not misleading, certain information or footnote information normally included in consolidated financial statements prepared in accordance with U.S. GAAP have been condensed or omitted as permitted under the rules and regulations of the SEC. In the opinion of management, all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair statement of financial position at September 30, 2022, and December 31, 2021, results of operations, comprehensive income (loss), and changes in stockholder’s deficit for the three and nine month periods ended September 30, 2022, and 2021 and cash flows for the nine months ended September 30, 2022, and 2021 have been included. The unaudited condensed consolidated financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2021, as filed with the SEC on March 1, 2022. The interim results for September 30, 2022 are not necessarily indicative of the results to be expected for the year ending December 31, 2022, or for any future interim periods. The consolidated financial statements reflect the accounts of Senseonics Holdings, Inc. and its wholly owned operating subsidiary Senseonics, Incorporated. The Company views its operations and manages its business in one segment, glucose monitoring products. 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 in assessing performance. Certain prior year amounts have been reclassified to conform to the current-year presentation. An adjustment has been made to the Consolidated Statements of Operations and Comprehensive Income (Loss) to consolidate the line items Sales and marketing expenses and General and administrative expenses to Selling, general and administrative expenses in order to conform to current year presentation. These reclassifications had no effect on the reported results of operations. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Recently Adopted In August 2020, the FASB issued ASU 2020-06, Debt-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contract in Entity’s Own Equity (Subtopic 815-40) . Not Yet Adopted In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses: Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”) debts with trade receivables. Accordingly, the Company does not expect this to have a significant impact on its consolidated financial statements and related disclosures at this time. The Company will adopt this guidance on the effective date for smaller reporting companies, January 1, 2023. |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the reported amounts of revenue and expenses during the reporting period. In the accompanying unaudited consolidated financial statements, estimates are used for, but not limited to, stock-based compensation, recoverability of long-lived assets, deferred taxes and valuation allowances, derivative assets and liabilities, obsolete inventory, warranty obligations, variable consideration related to revenue, depreciable lives of property and equipment, and accruals for clinical study costs, which are accrued based on estimates of work performed under contract. The Company considered COVID-19 related impacts to its estimates, as appropriate, within its unaudited condensed consolidated financial statements and there may be changes to those estimates in future periods due to the uncertainties surrounding the severity and duration of the COVID-19 pandemic. Actual results could differ from those estimates. |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Revenue Recognition | |
Schedule of revenue by geographic region | Three Months Ended Nine Months Ended September 30, 2022 September 30, 2022 % % (Dollars in thousands) Amount of Total Amount of Total Revenue, net: Outside of the United States $ 2,688 58.2 % $ 6,910 63.9 % United States 1,934 41.8 3,908 36.1 Total $ 4,622 100.0 % $ 10,818 100.0 % Three Months Ended Nine Months Ended September 30, 2021 September 30, 2021 % % (Dollars in thousands) Amount of Total Amount of Total Revenue, net: Outside of the United States $ 2,928 82.9 % $ 7,771 80.4 % United States 604 17.1 1,896 19.6 Total $ 3,532 100.0 % $ 9,667 100.0 % |
Net Income (Loss) per Share (Ta
Net Income (Loss) per Share (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Net Income (Loss) per Share | |
Schedule of computation of basic and diluted net income per share | Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Net income (loss) (60,391) 42,914 130,558 (386,907) Impact of conversion of dilutive securities — 1,385 (188,563) — Dilutive Net income (loss) (60,391) 44,299 (58,005) (386,907) Net income (loss) per share Basic (0.13) 0.10 0.28 (0.93) Diluted (0.13) 0.08 (0.10) (0.93) Basic weighted average shares outstanding 472,475,747 445,378,308 464,244,736 414,128,283 Dilutive potential common stock outstanding Stock-based awards — 15,520,414 6,499,671 — 2023 Notes — 4,617,646 4,617,646 — 2025 Notes — 39,689,142 39,211,358 — PHC Notes — 65,348,857 67,625,174 — Energy Capital Option — — 23,335,635 — Warrants — 11,206,148 2,811,493 — Diluted weighted average shares outstanding 472,475,747 581,760,516 608,345,713 414,128,283 |
Schedule of anti-dilutive shares which have been excluded from the computation of diluted net loss per share | Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Stock-based awards 24,940,972 1,949,958 10,426,560 28,502,846 2023 Notes 4,617,646 — — 4,617,646 2025 Notes 39,211,358 — — 39,689,142 PHC Notes 68,322,952 — — 65,757,177 PHC Option 31,512,605 — 22,717,076 — Energy Capital Option 30,372,058 — — Warrants 3,177,821 116,581 427,821 13,177,822 Total anti-dilutive shares outstanding 202,155,412 2,066,539 33,571,457 151,744,633 |
Marketable Securities (Tables)
Marketable Securities (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Marketable Securities | |
Schedule of marketable securities available for sale | Marketable securities available for sale, were as follows (in thousands): September 30, 2022 Gross Gross Estimated Amortized Unrealized Unrealized Market Cost Gains Losses Value Commercial Paper $ 32,614 — — $ 32,614 Corporate debt securities $ 37,209 — (425) $ 36,784 Asset backed securities $ 13,979 — (130) $ 13,849 Government and agency securities $ 44,949 — (630) $ 44,319 Total $ 128,751 $ — $ (1,185) $ 127,566 December 31, 2021 Gross Gross Estimated Amortized Unrealized Unrealized Market Cost Gains Losses Value Commercial Paper $ 57,369 — — $ 57,369 Corporate debt securities $ 39,825 — (77) $ 39,748 Asset backed securities $ 26,736 — (29) $ 26,707 Government and agency securities $ 24,609 — (106) $ 24,503 Total $ 148,539 $ — $ (212) $ 148,327 |
Schedule of maturities of marketable securities | The following are the scheduled maturities as of September 30, 2022 (in thousands): 2022 (remaining three months) $ 29,625 2023 90,175 2024 2,221 2025 6,730 Total $ 128,751 |
Inventory, net (Tables)
Inventory, net (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Inventory, net | |
Schedule of Inventory, net | Inventory, net of reserves, consisted of the following (in thousands): September 30, December 31, 2022 2021 Finished goods $ 1,428 $ 1,012 Work-in-process 4,306 3,770 Raw materials 1,523 1,534 Total $ 7,257 $ 6,316 |
Prepaid Expenses and Other Cu_2
Prepaid Expenses and Other Current Assets, and Deposits and other assets (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Prepaid Expenses and Other Current Assets, and Deposits and other assets | |
Schedule of prepaid expenses and other current assets | Prepaid expenses and other current assets consisted of the following (in thousands): September 30, December 31, 2022 2021 Contract manufacturing⁽¹⁾ $ 4,028 $ 5,036 Insurance 506 74 Clinical and Preclinical 472 142 Interest receivable 369 443 Research and development 9 39 Accounting and Audit 148 — Rent and utilities 108 105 IT and software 21 225 Sales and Marketing 17 98 Other 36 56 Total prepaid expenses and other current assets $ 5,714 $ 6,218 (1) Includes deposits to contract manufacturers for manufacturing process . |
Accrued Expenses, Other Curre_2
Accrued Expenses, Other Current Liabilities, and Other Liabilities (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Accrued Expenses, Other Current Liabilities, and Other Liabilities | |
Schedule of accrued expenses and other current liabilities | Accrued expenses and other current liabilities consisted of the following (in thousands): September 30, December 31, 2022 2021 Compensation and benefits $ 3,462 $ 3,484 Research and development 3,417 2,145 Interest on notes payable 1,887 2,144 Sales and marketing services 155 1,962 Product warranty and replacement obligations 661 1,697 Professional and administration services 1,334 1,011 Contract manufacturing 1,675 914 Operating lease 730 904 Other 24 3 Total accrued expenses and other current liabilities $ 13,345 $ 14,264 |
Product Warranty Obligations (T
Product Warranty Obligations (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Product Warranty Obligations | |
Schedule of estimated warranty liabilities | September 30, December 31, 2022 2021 Balance at beginning of the period $ 723 $ 646 Provision for warranties during the period (53) 781 Settlements made during the period (8) (704) Balance at end of the period $ 662 $ 723 |
Notes Payable, Preferred Stoc_2
Notes Payable, Preferred Stock and Stock Purchase Warrants (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Notes Payable, Preferred Stock and Stock Purchase Warrants | |
Schedule of carrying amounts outstanding under the Company's notes payable | September 30, 2022 Principal ($) Debt Discount ($) Issuance Costs ($) Carrying Amount ($) 2023 Notes 15,700 (477) - 15,223 2025 Notes 51,199 (16,500) (276) 34,423 PHC Notes 35,000 (15,068) (921) 19,011 December 31, 2021 Principal ($) Debt Discount ($) Issuance Costs ($) Carrying Amount ($) 2023 Notes 15,700 (1,499) - 14,201 2025 Notes 51,199 (20,535) (344) 30,320 PHC Notes 35,000 (18,587) (1,136) 15,277 PPP Loan 2,926 - - 2,926 |
Schedule of interest expense related to the notes payable | Nine Months Ended September 30, 2022 Interest Rate Interest ($) Debt Discount and Fees ($) Issuance Costs ($) Loss on Extinguishment ($) Total Interest Expense ($) 2023 Notes 5.25% 618 1,022 - - 1,640 2025 Notes 5.25% 2,002 4,035 68 - 6,104 PHC Notes 8.00% 2,319 3,519 215 - 6,053 PPP Loan 1.00% 6 - - - 6 Total 4,945 8,576 283 - 13,803 Nine Months Ended September 30, 2021 Interest Rate Interest ($) Debt Discount and Fees ($) Issuance Costs ($) Loss on Extinguishment ($) Total Interest Expense ($) 2023 Notes 5.25% 618 931 - - 1,549 2025 Notes 5.25% 2,044 3,362 56 3,183 8,645 PHC Notes 9.50% 2,456 2,627 161 - 5,244 PPP Loan 1.00% 44 - - - 44 Total 5,162 6,920 217 3,183 15,482 |
Schedule of future maturities | 2022 (remaining three months) $ — 2023 15,700 2024 35,000 2025 51,199 Total $ 101,899 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value Measurements | |
Schedule of fair value hierarchy of the Company's financial assets and liabilities measured at fair value on a recurring basis | The following table represents the fair value hierarchy of the Company’s financial assets and liabilities measured at fair value on a recurring basis at September 30, 2022 and December 31, 2021 (in thousands): September 30, 2022 Total Level 1 Level 2 Level 3 Assets Money market funds⁽¹⁾ $ 33,610 $ 33,610 — — Commercial paper 32,614 — 32,614 — Corporate debt securities 36,784 — 36,784 — Asset backed securities 13,849 — 13,849 — Government and agency securities 44,319 37,403 6,916 — PHC Option 101 — — 101 Liabilities Energy Capital Option $ 28,068 $ — — 28,068 Embedded features of the 2023 Notes 328 — 328 — Embedded features of the PHC Notes 63,847 — — 63,847 Embedded features of the 2025 Notes 19,947 — 19,947 — December 31, 2021 Total Level 1 Level 2 Level 3 Assets Money market funds⁽¹⁾ $ 29,197 $ 29,197 — — Commercial paper 57,369 — 57,369 — Corporate debt securities 39,748 — 39,748 — Asset backed securities 26,707 — 26,707 — Government and agency securities 24,503 19,957 4,546 — PHC Option 239 — — 239 Liabilities Energy Capital Option $ 69,401 $ — — 69,401 Embedded features of the 2023 Notes 5,817 — — 5,817 Embedded features of the PHC Notes 149,058 — — 149,058 Embedded features of the 2025 Notes 81,417 — 81,417 — (1) Classified as cash and cash equivalents due to their short-term maturity |
Schedule of changes in the fair value of Level 3 derivative liability measured at fair value | The following table provides a reconciliation of the beginning and ending net balances of items measured at fair value on a recurring basis that used significant unobservable inputs (Level 3) (in thousands): Level 3 Instruments December 31, 2021 $ 224,037 Gain on fair value adjustment of option (41,333) Gain on change in fair value of derivatives (85,211) Financial asset (gain) impairment cost, net 138 Change in fair value hierarchy classification (5,817) September 30, 2022 $ 91,814 |
Schedule of assumptions used to determine fair value | PHC Notes PHC Option Energy Capital Option Unobservable Inputs Assumptions Assumptions Assumptions Stock price volatility 110.0 % 104.0 % 88.0 % Probabilities of conversion provisions 5.0 - 10.0 % 5.0 - 10.0 % 5.0 - 10.0 % Time period until maturity (yrs) 2.09 0.25 0.00 - 0.11 Dividend yield — % — % — % |
Liquidity and Capital Resourc_2
Liquidity and Capital Resources (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||||||||
Nov. 07, 2022 | Jan. 01, 2022 | Jan. 31, 2021 | Jan. 27, 2021 | Jan. 21, 2021 | Jan. 17, 2021 | Nov. 09, 2020 | Aug. 09, 2020 | Nov. 30, 2021 | Jun. 30, 2021 | Jan. 21, 2021 | Nov. 30, 2019 | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Net Income (Loss) | $ (60,391) | $ 42,914 | $ 130,558 | $ (386,907) | $ (302,500) | $ (175,200) | $ (115,500) | ||||||||||||
Accumulated deficit | (820,427) | (820,427) | (950,985) | ||||||||||||||||
Issuance of common stock, net | 26,439 | 34,443 | $ 200,440 | ||||||||||||||||
Cash, cash equivalents and marketable securities | $ 163,000 | $ 163,000 | |||||||||||||||||
Common stock, par value per share (in dollars per share) | $ 0.001 | $ 0.001 | |||||||||||||||||
PHC Notes | |||||||||||||||||||
Aggregate principal amount | $ 35,000 | $ 35,000 | $ 35,000 | $ 35,000 | |||||||||||||||
Financing fee shares issued | 2,941,176 | ||||||||||||||||||
Conversion price | $ 0.54 | ||||||||||||||||||
Common stock, par value per share (in dollars per share) | $ 0.001 | ||||||||||||||||||
Masters Capital | |||||||||||||||||||
Proceeds from issuance of stock | $ 22,800 | ||||||||||||||||||
Ascensia | PHC Notes | |||||||||||||||||||
Aggregate principal amount | $ 35,000 | ||||||||||||||||||
Energy Capital, LLC | |||||||||||||||||||
Cash and cash equivalents and other available credit | $ 8,000 | $ 8,000 | |||||||||||||||||
Energy Capital, LLC | Maximum | |||||||||||||||||||
Issuance of convertible preferred stock, net | $ 4,000 | $ 12,000 | |||||||||||||||||
Share price | $ 0.25 | $ 0.25 | |||||||||||||||||
Convertible Preferred Equity | |||||||||||||||||||
Amount of possible additional debt principal amount | $ 15,000 | ||||||||||||||||||
Convertible Preferred Equity | Masters Capital | |||||||||||||||||||
Shares issued | 3,000 | ||||||||||||||||||
Convertible Preferred Equity | Energy Capital, LLC | |||||||||||||||||||
Issuance of convertible preferred stock, net | $ 12,000 | ||||||||||||||||||
Price per share (in dollars per share) | 1,000 | 1,000 | |||||||||||||||||
Collaboration and commercialization agreement term | 24 months | ||||||||||||||||||
Share price | 1,000 | $ 1,000 | |||||||||||||||||
Threshold redemption period of temporary equity | 6 months | ||||||||||||||||||
Conversion price | 0.3951 | $ 0.3951 | |||||||||||||||||
Series A Preferred Stock | Masters Capital | |||||||||||||||||||
Shares issued | 22,783 | ||||||||||||||||||
Price per share (in dollars per share) | $ 1,000 | $ 1,000 | |||||||||||||||||
Conversion price | $ 0.476 | ||||||||||||||||||
Series A Preferred Stock | Masters Capital | Maximum | |||||||||||||||||||
Shares issued | 27,000 | ||||||||||||||||||
Series B Preferred Stock | |||||||||||||||||||
Maximum amount of shares that can be purchased under the equity line agreement at purchase price | $ 12,000 | ||||||||||||||||||
Regular Purchase, Shares Sold | 0 | ||||||||||||||||||
Series B Preferred Stock | Energy Capital, LLC | |||||||||||||||||||
Issuance of convertible preferred stock, net | $ 12,000 | ||||||||||||||||||
Purchasers | |||||||||||||||||||
Shares issued | 40,000,000 | ||||||||||||||||||
Price per share (in dollars per share) | $ 1.25 | ||||||||||||||||||
Common stock, par value per share (in dollars per share) | $ 0.001 | ||||||||||||||||||
Net proceeds | $ 46,100 | ||||||||||||||||||
Proceeds from issuance of stock | $ 50,000 | ||||||||||||||||||
Overallotment | Purchasers | |||||||||||||||||||
Price per share (in dollars per share) | 1.925 | $ 1.925 | |||||||||||||||||
Underwriters Share Price | $ 1.799875 | ||||||||||||||||||
Overallotment | 2021 Public Offering | |||||||||||||||||||
Shares issued | 7,792,207 | 51,948,052 | |||||||||||||||||
Net proceeds | $ 106,100 | ||||||||||||||||||
Open Market Sale Agreement | |||||||||||||||||||
Shares issued | 12,830,333 | 15,160,899 | |||||||||||||||||
Proceeds from issuance of stock | $ 48,400 | $ 34,400 | |||||||||||||||||
Open Market Sale Agreement | Maximum | |||||||||||||||||||
Issuance of common stock, net | $ 150,000 | $ 50,000 | |||||||||||||||||
Percentage of commission on proceeds from common stock | 3% |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies - Segment Information (Details) | 9 Months Ended |
Sep. 30, 2022 segment | |
Segment Information | |
Number of operating segments | 1 |
Revenue Recognition - Revenue b
Revenue Recognition - Revenue by Geographic Region (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 USD ($) | Sep. 30, 2021 USD ($) | Sep. 30, 2022 USD ($) item | Sep. 30, 2021 USD ($) | |
Revenue, net: | ||||
Revenue | $ 4,622 | $ 3,532 | $ 10,818 | $ 9,667 |
Percent of total revenue | 100% | 100% | 100% | 100% |
Number of geographical markets | item | 2 | |||
Outside of the United States | ||||
Revenue, net: | ||||
Revenue | $ 2,688 | $ 2,928 | $ 6,910 | $ 7,771 |
Percent of total revenue | 58.20% | 82.90% | 63.90% | 80.40% |
United States | ||||
Revenue, net: | ||||
Revenue | $ 1,934 | $ 604 | $ 3,908 | $ 1,896 |
Percent of total revenue | 41.80% | 17.10% | 36.10% | 19.60% |
Revenue Recognition - Contract
Revenue Recognition - Contract Assets (Details) - USD ($) $ in Millions | Sep. 30, 2022 | Dec. 31, 2021 |
Revenue Recognition | ||
Unbilled receivables from customers | $ 1.1 | $ 1.8 |
Revenue Recognition - Concentra
Revenue Recognition - Concentration of Revenue and Customers (Details) - Customer concentration risk - Ascensia - customer | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Concentration Risk [Line Items] | ||||
Number of customers | 1 | 1 | 1 | 1 |
Revenue | ||||
Concentration Risk [Line Items] | ||||
Concentration Risk, Percentage | 0.97% | 0.92% | 0.95% | 0.88% |
Net Income (Loss) per Share - B
Net Income (Loss) per Share - Basic and Diluted Net Income Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||||
Net Income (Loss) | $ (60,391) | $ 42,914 | $ 130,558 | $ (386,907) | $ (302,500) | $ (175,200) | $ (115,500) |
Impact of conversion of dilutive securities | 1,385 | (188,563) | |||||
Dilutive Net income (loss) | $ (60,391) | $ 44,299 | $ (58,005) | $ (386,907) | |||
Net income (loss) per share | |||||||
Basic | $ (0.13) | $ 0.10 | $ 0.28 | $ (0.93) | |||
Diluted | $ (0.13) | $ 0.08 | $ (0.10) | $ (0.93) | |||
Basic weighted average shares outstanding | 472,475,747 | 445,378,308 | 464,244,736 | 414,128,283 | |||
Dilutive potential common stock outstanding | |||||||
Stock-based awards | 15,520,414 | 6,499,671 | |||||
Warrants | 11,206,148 | 2,811,493 | |||||
Diluted weighted average shares outstanding | 472,475,747 | 581,760,516 | 608,345,713 | 414,128,283 | |||
Anti-dilutive shares outstanding | 202,155,412 | 2,066,539 | 33,571,457 | 151,744,633 | |||
Stock-based awards | |||||||
Dilutive potential common stock outstanding | |||||||
Anti-dilutive shares outstanding | 24,940,972 | 1,949,958 | 10,426,560 | 28,502,846 | |||
2023 Notes | |||||||
Dilutive potential common stock outstanding | |||||||
Convertible Notes | 4,617,646 | 4,617,646 | |||||
Anti-dilutive shares outstanding | 4,617,646 | 4,617,646 | |||||
2025 Notes | |||||||
Dilutive potential common stock outstanding | |||||||
Convertible Notes | 39,689,142 | 39,211,358 | |||||
Anti-dilutive shares outstanding | 39,211,358 | 39,689,142 | |||||
PHC Notes | |||||||
Dilutive potential common stock outstanding | |||||||
Convertible Notes | 65,348,857 | 67,625,174 | |||||
Anti-dilutive shares outstanding | 68,322,952 | 65,757,177 | |||||
PHC Option | |||||||
Dilutive potential common stock outstanding | |||||||
Anti-dilutive shares outstanding | 31,512,605 | 22,717,076 | |||||
Energy Capital Option | |||||||
Dilutive potential common stock outstanding | |||||||
Convertible Notes | 23,335,635 | ||||||
Anti-dilutive shares outstanding | 30,372,058 | ||||||
Warrants | |||||||
Dilutive potential common stock outstanding | |||||||
Anti-dilutive shares outstanding | 3,177,821 | 116,581 | 427,821 | 13,177,822 |
Marketable Securities - AFS Deb
Marketable Securities - AFS Debt Securities (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Marketable securities available for sale, consisting of debt securities: | ||
Amortized Cost | $ 128,751 | $ 148,539 |
Gross Unrealized Losses | (1,185) | (212) |
Estimated Market Value | 127,566 | 148,327 |
Commercial paper | ||
Marketable securities available for sale, consisting of debt securities: | ||
Amortized Cost | 32,614 | 57,369 |
Estimated Market Value | 32,614 | 57,369 |
Corporate debt securities | ||
Marketable securities available for sale, consisting of debt securities: | ||
Amortized Cost | 37,209 | 39,825 |
Gross Unrealized Losses | (425) | (77) |
Estimated Market Value | 36,784 | 39,748 |
Asset backed Securities | ||
Marketable securities available for sale, consisting of debt securities: | ||
Amortized Cost | 13,979 | 26,736 |
Gross Unrealized Losses | (130) | (29) |
Estimated Market Value | 13,849 | 26,707 |
Government and agency securities | ||
Marketable securities available for sale, consisting of debt securities: | ||
Amortized Cost | 44,949 | 24,609 |
Gross Unrealized Losses | (630) | (106) |
Estimated Market Value | $ 44,319 | $ 24,503 |
Marketable Securities - AFS D_2
Marketable Securities - AFS Debt Securities - Maturities (Details) $ in Thousands | Sep. 30, 2022 USD ($) |
Debt Securities, Available-for-sale, Fair Value, Fiscal Year Maturity [Abstract] | |
2022 (remaining three months) | $ 29,625 |
2023 | 90,175 |
2024 | 2,221 |
2025 | 6,730 |
Total | $ 128,751 |
Inventory, net (Details)
Inventory, net (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Finished goods | $ 1,428 | $ 1,428 | $ 1,012 | |
Work-in-process | 4,306 | 4,306 | 3,770 | |
Raw materials | 1,523 | 1,523 | 1,534 | |
Total | 7,257 | 7,257 | $ 6,316 | |
Inventory Valuation and Obsolescence | ||||
Inventory adjustments included in cost of sales | ||||
Cost | $ 500 | $ 1,100 | $ 1,800 |
Prepaid Expenses and Other Cu_3
Prepaid Expenses and Other Current Assets, and Deposits and other assets (Details) $ in Thousands | Sep. 30, 2022 USD ($) ft² | Jun. 30, 2022 | Dec. 31, 2021 USD ($) |
Prepaid Expenses and Other Current Assets, and Deposits and other assets | |||
Contract manufacturing | $ 4,028 | $ 5,036 | |
Insurance | 506 | 74 | |
Clinical and Preclinical | 472 | 142 | |
Interest receivable | 369 | 443 | |
Research and development | 9 | 39 | |
Accounting and Audit | 148 | ||
Rent and utilities | 108 | 105 | |
IT and software | 21 | 225 | |
Sales and Marketing | 17 | 98 | |
Other | 36 | 56 | |
Total prepaid expenses and other current assets | 5,714 | 6,218 | |
Deposits and other assets | 3,241 | $ 1,086 | |
Right of use asset, building | $ 3,100 | ||
Leased space, in square feet | ft² | 33,000 | ||
Renewal term of lease | 5 years |
Accrued Expenses, Other Curre_3
Accrued Expenses, Other Current Liabilities, and Other Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Jun. 30, 2022 | Dec. 31, 2021 |
Accrued Expenses, Other Current Liabilities, and Other Liabilities | |||
Compensation and benefits | $ 3,462 | $ 3,484 | |
Research and development | 3,417 | 2,145 | |
Interest on notes payable | 1,887 | 2,144 | |
Sales and marketing services | 155 | 1,962 | |
Product warranty and replacement obligations | 661 | 1,697 | |
Professional and administration services | 1,334 | 1,011 | |
Contract manufacturing | 1,675 | 914 | |
Operating lease | 730 | 904 | |
Other | 24 | 3 | |
Total accrued expenses and other current liabilities | 13,345 | 14,264 | |
Non-current operating lease liabilities | $ 2,900 | $ 600 | |
Renewal term of lease | 5 years |
Product Warranty Obligations (D
Product Warranty Obligations (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2022 | Dec. 31, 2021 | |
Product Warranty Obligations | ||
Warranty term | 1 year | |
Warranty reserve | $ 662 | $ 723 |
Reconciliation of the change in estimated warranty liabilities | ||
Balance at beginning of the period | 723 | 646 |
Provision for warranties during the period (reversals from prior period) | (53) | 781 |
Settlements made during the period | (8) | (704) |
Balance at end of the period | $ 662 | $ 723 |
Notes Payable, Preferred Stoc_3
Notes Payable, Preferred Stock and Stock Purchase Warrants (Details) | 9 Months Ended | ||||||||||||||
Jan. 01, 2022 USD ($) shares | Jan. 31, 2021 USD ($) $ / shares shares | Jan. 21, 2021 USD ($) $ / shares shares | Nov. 09, 2020 USD ($) $ / shares | Aug. 09, 2020 USD ($) $ / shares shares | Apr. 24, 2020 USD ($) $ / shares shares | Apr. 22, 2020 USD ($) | Sep. 30, 2022 USD ($) $ / shares shares | Sep. 30, 2021 USD ($) | Apr. 30, 2022 | Feb. 28, 2022 shares | Dec. 31, 2021 USD ($) | May 09, 2021 $ / shares shares | Dec. 31, 2020 USD ($) | Mar. 31, 2018 USD ($) | |
Debt Instrument [Line Items] | |||||||||||||||
Loss on extinguishment | $ (3,183,000) | ||||||||||||||
Notes payable | |||||||||||||||
Derivative assets | $ 101,000 | $ 239,000 | |||||||||||||
Carrying Amount | 53,434,000 | 59,798,000 | |||||||||||||
Derivative liabilities | $ 83,794,000 | 236,291,000 | |||||||||||||
Common stock, par value per share (in dollars per share) | $ / shares | $ 0.001 | ||||||||||||||
Exchange Agreement with Highbridge | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Warrants to purchase shares | shares | 4,500,000 | ||||||||||||||
Exercise price of warrant (in dollars per share) | $ / shares | $ 0.66 | ||||||||||||||
Notes payable | |||||||||||||||
Shares issued | shares | 11,026,086 | ||||||||||||||
Accrued and unpaid interest | $ 300,000 | ||||||||||||||
2023 Notes. | |||||||||||||||
Notes payable | |||||||||||||||
Fair value of the embedded conversion option | $ 300,000 | 5,800,000 | |||||||||||||
Derivative liabilities | $ 17,300,000 | ||||||||||||||
PHC Notes | |||||||||||||||
Notes payable | |||||||||||||||
Principal amount | $ 35,000,000 | 35,000,000 | 35,000,000 | ||||||||||||
Interest rate (as a percent) | 9.50% | 8% | |||||||||||||
Carrying Amount | 19,011,000 | 15,277,000 | |||||||||||||
Debt issuance costs and discounts | $ 1,400,000 | ||||||||||||||
Fair value of the embedded conversion option | $ 25,800,000 | $ 63,800,000 | 149,100,000 | ||||||||||||
Effective Interest Rate | 8% | 9.50% | |||||||||||||
Original debt conversion amount | $ 0 | ||||||||||||||
Financing fee shares issued | shares | 2,941,176 | ||||||||||||||
Common stock, par value per share (in dollars per share) | $ / shares | $ 0.001 | ||||||||||||||
Debt discount of financing fee shares | $ 1,500,000 | ||||||||||||||
Conversion rate | 1,867.4136 | ||||||||||||||
Conversion price | $ / shares | $ 0.54 | ||||||||||||||
Conversion of Stock, Amount Issued | $ 15,000,000 | ||||||||||||||
Issuance costs incurred | 2,900,000 | 921,000 | 1,136,000 | ||||||||||||
Amount of principal which is converted to shares | $ 1,000 | ||||||||||||||
PHC Notes | Debt Redemption on or After October 31, 2022 | |||||||||||||||
Notes payable | |||||||||||||||
Threshold percentage of stock trigger | 275% | ||||||||||||||
Notice period | 10 days | ||||||||||||||
PHC Notes | Debt Redemption on or After October 31, 2023 | |||||||||||||||
Notes payable | |||||||||||||||
Notice period | 10 days | ||||||||||||||
PHC Notes | Debt Redemption Six Months Prior to Maturity Date | |||||||||||||||
Notes payable | |||||||||||||||
Call premium percentage | 130% | ||||||||||||||
PHC Notes | Debt Redemption Within Six Months of Maturity Date | |||||||||||||||
Notes payable | |||||||||||||||
Call premium percentage | 125% | ||||||||||||||
2025 Notes | |||||||||||||||
Notes payable | |||||||||||||||
Fair value of the embedded conversion option | $ 19,900,000 | 81,400,000 | |||||||||||||
2025 Notes | Exchange Agreement with Highbridge | |||||||||||||||
Notes payable | |||||||||||||||
Principal amount | 24,000,000 | ||||||||||||||
Deferred issuance costs and debt discounts | 13,200,000 | ||||||||||||||
PPP Loan | |||||||||||||||
Notes payable | |||||||||||||||
Amount received from loan funding | $ 5,800,000 | ||||||||||||||
Principal amount | 2,926,000 | ||||||||||||||
Interest rate (as a percent) | 1% | ||||||||||||||
Note term | 2 years | ||||||||||||||
Carrying Amount | 2,926,000 | ||||||||||||||
Effective Interest Rate | 1% | 1% | |||||||||||||
PPP Loan | Silicon Valley Bank | |||||||||||||||
Notes payable | |||||||||||||||
Principal amount | $ 5,800,000 | ||||||||||||||
Second Lien Notes | Exchange Agreement with Highbridge | |||||||||||||||
Notes payable | |||||||||||||||
Principal amount | $ 15,700,000 | ||||||||||||||
PHC Option | Put option | |||||||||||||||
Notes payable | |||||||||||||||
Derivative assets | $ 100,000 | 200,000 | |||||||||||||
PHC Option | Put option | Maximum | |||||||||||||||
Notes payable | |||||||||||||||
Gain on fair value adjustment of derivatives | 100,000 | ||||||||||||||
Energy Capital Facility | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Net exercise of warrants | shares | 8,917,535 | ||||||||||||||
Exercise price of warrant (in dollars per share) | $ / shares | $ 0.3951 | ||||||||||||||
Notes payable | |||||||||||||||
Deferred issuance costs and debt discounts | $ 7,600,000 | ||||||||||||||
Period to purchase stock | 24 months | ||||||||||||||
Derivative liabilities | $ 4,200,000 | $ 28,100,000 | $ 69,400,000 | ||||||||||||
Energy Capital Facility | Maximum | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Warrants to purchase shares | shares | 10,000,000 | ||||||||||||||
Notes payable | |||||||||||||||
Share price for debt conversion | $ / shares | $ 0.25 | ||||||||||||||
Cash Cash Equivalents and Other Available Credit Threshold | $ 8,000,000 | ||||||||||||||
Series B Preferred Stock | |||||||||||||||
Notes payable | |||||||||||||||
Number of shares sold pursuant to regular purchases | shares | 0 | ||||||||||||||
Maximum amount of shares that can be purchased under the equity line agreement at purchase price | $ 12,000,000 | ||||||||||||||
Series B Preferred Stock | Energy Capital Facility | |||||||||||||||
Notes payable | |||||||||||||||
Preferred stock value | $ 12,000,000 | ||||||||||||||
Share price for debt conversion | $ / shares | $ 1,000 | ||||||||||||||
Number of shares sold pursuant to regular purchases | shares | 0 | ||||||||||||||
Maximum amount of shares that can be purchased under the equity line agreement at purchase price | $ 12,000,000 | ||||||||||||||
Period to purchase stock | 6 months | ||||||||||||||
Daily limit | $ 4,000,000 | ||||||||||||||
Conversion price | $ / shares | $ 0.3951 | ||||||||||||||
Series A Preferred Stock | |||||||||||||||
Notes payable | |||||||||||||||
Debt converted, Shares issued | shares | 25,783 | ||||||||||||||
Gain on extinguishment | $ 3,500,000 | ||||||||||||||
Series A Preferred Stock | Masters Capital | |||||||||||||||
Notes payable | |||||||||||||||
Shares issued | shares | 22,783 | ||||||||||||||
Conversion price | $ / shares | $ 0.476 | ||||||||||||||
Amount of principal which is converted to shares | $ 1,000 | ||||||||||||||
Number of shares issued and sold | shares | 3,000 | ||||||||||||||
Price per share (in dollars per share) | $ / shares | $ 1,000 | $ 1,000 | |||||||||||||
Additional shares issued | shares | 22,783 | ||||||||||||||
Gross proceeds from stock | $ 22,800,000 | ||||||||||||||
Series A Preferred Stock | Masters Capital | Maximum | |||||||||||||||
Notes payable | |||||||||||||||
Shares issued | shares | 27,000 | ||||||||||||||
Number of shares issued and sold | shares | 27,000 |
Notes Payable, Preferred Stoc_4
Notes Payable, Preferred Stock and Stock Purchase Warrants - Term Notes Payable (Details) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Jul. 31, 2019 USD ($) $ / shares | Mar. 31, 2018 USD ($) $ / shares | Sep. 30, 2022 USD ($) | Sep. 30, 2021 USD ($) | Dec. 31, 2021 USD ($) shares | |
Long term debt | |||||
Loss on extinguishment of debt and issuance of debt | $ (3,183,000) | ||||
2023 Notes. | |||||
Long term debt | |||||
Fair value of the embedded conversion option | $ 300,000 | $ 5,800,000 | |||
2023 Notes | |||||
Long term debt | |||||
Principal amount | $ 53,000,000 | 15,700,000 | 15,700,000 | ||
Conversion rate (per $1,000 of principal) | 294.1176 | ||||
Conversion price (in dollars per share) | $ / shares | $ 3.40 | ||||
Repurchase price as a percent of principal amount | 100% | ||||
Transaction costs | $ 2,200,000 | ||||
Amortization percent | 9.30% | ||||
Repurchase amount | $ 37,000,000 | ||||
Amount of principal which is converted to shares | $ 1,000 | ||||
Original debt conversion amount | 0 | ||||
2025 Notes. | |||||
Long term debt | |||||
Principal amount | $ 82,000,000 | 51,199,000 | 51,199,000 | ||
Conversion rate (per $1,000 of principal) | 757.5758 | ||||
Conversion price (in dollars per share) | $ / shares | $ 1.32 | ||||
Amount of principal which is converted to shares | $ 1,000 | ||||
Original debt conversion amount | $ 0 | $ 6,500,000 | |||
Debt converted, Shares issued | shares | 4,924,998 | ||||
Loss on extinguishment of debt and issuance of debt | $ (3,183,000) | $ (3,200,000) |
Notes Payable, Preferred Stoc_5
Notes Payable, Preferred Stock and Stock Purchase Warrants - Carrying amount of notes payable (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 | Aug. 09, 2020 | Jul. 31, 2019 | Mar. 31, 2018 |
Debt Instrument [Line Items] | |||||
Carrying Amount | $ 53,434 | $ 59,798 | |||
2023 Notes | |||||
Debt Instrument [Line Items] | |||||
Aggregate principal amount | 15,700 | 15,700 | $ 53,000 | ||
Debt Discount | (477) | (1,499) | |||
Carrying Amount | 15,223 | 14,201 | |||
2025 Notes. | |||||
Debt Instrument [Line Items] | |||||
Aggregate principal amount | 51,199 | 51,199 | $ 82,000 | ||
Debt Discount | (16,500) | (20,535) | |||
Issuance Costs | (276) | (344) | |||
Carrying Amount | 34,423 | 30,320 | |||
PHC Notes | |||||
Debt Instrument [Line Items] | |||||
Aggregate principal amount | 35,000 | 35,000 | $ 35,000 | ||
Debt Discount | (15,068) | (18,587) | |||
Issuance Costs | (921) | (1,136) | $ (2,900) | ||
Carrying Amount | $ 19,011 | 15,277 | |||
PPP Loan | |||||
Debt Instrument [Line Items] | |||||
Aggregate principal amount | 2,926 | ||||
Carrying Amount | $ 2,926 |
Notes Payable, Preferred Stoc_6
Notes Payable, Preferred Stock and Stock Purchase Warrants - Interest expense (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Long term debt | |||
Interest | $ 4,945 | $ 5,162 | |
Debt Discount and Fees | 8,576 | 6,920 | |
Issuance Costs | 283 | 217 | |
Loss on Extinguishment | 3,183 | ||
Total Interest Expense | $ 13,803 | $ 15,482 | |
2023 Notes | |||
Long term debt | |||
Effective Interest Rate | 5.25% | 5.25% | |
Interest | $ 618 | $ 618 | |
Debt Discount and Fees | 1,022 | 931 | |
Total Interest Expense | $ 1,640 | $ 1,549 | |
2025 Notes. | |||
Long term debt | |||
Effective Interest Rate | 5.25% | 5.25% | |
Interest | $ 2,002 | $ 2,044 | |
Debt Discount and Fees | 4,035 | 3,362 | |
Issuance Costs | 68 | 56 | |
Loss on Extinguishment | 3,183 | $ 3,200 | |
Total Interest Expense | $ 6,104 | $ 8,645 | |
PHC Notes | |||
Long term debt | |||
Effective Interest Rate | 8% | 9.50% | |
Interest | $ 2,319 | $ 2,456 | |
Debt Discount and Fees | 3,519 | 2,627 | |
Issuance Costs | 215 | 161 | |
Total Interest Expense | $ 6,053 | $ 5,244 | |
PPP Loan | |||
Long term debt | |||
Effective Interest Rate | 1% | 1% | |
Interest | $ 6 | $ 44 | |
Total Interest Expense | $ 6 | $ 44 |
Notes Payable, Preferred Stoc_7
Notes Payable, Preferred Stock and Stock Purchase Warrants - Scheduled Maturities (Details) $ in Thousands | Sep. 30, 2022 USD ($) |
Scheduled maturities | |
2023 | $ 15,700 |
2024 | 35,000 |
2025 | 51,199 |
Total | $ 101,899 |
Stockholders' Equity (Deficit)
Stockholders' Equity (Deficit) (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||
Nov. 30, 2021 | Jun. 30, 2021 | Nov. 30, 2019 | Sep. 30, 2022 | Sep. 30, 2022 | Sep. 30, 2021 | |
Class of Stock [Line Items] | ||||||
Proceeds from offering | $ 26,439 | $ 34,443 | $ 200,440 | |||
Open Market Sale Agreement | ||||||
Class of Stock [Line Items] | ||||||
Proceeds from issuance of common stock, net | $ 48,400 | $ 34,400 | ||||
Number of additional shares issued | 99,740,259 | |||||
Shares issued | 12,830,333 | 15,160,899 | ||||
Open Market Sale Agreement | Maximum | ||||||
Class of Stock [Line Items] | ||||||
Proceeds from offering | $ 150,000 | $ 50,000 | ||||
Percentage of commission on proceeds from common stock | 3% | |||||
2019 Sales Agreement | ||||||
Class of Stock [Line Items] | ||||||
Proceeds from issuance of common stock, net | $ 48,400 | |||||
Shares issued | 12,830,333 | |||||
2019 Sales Agreement | Maximum | ||||||
Class of Stock [Line Items] | ||||||
Proceeds from offering | $ 50,000 | |||||
Offering | ||||||
Class of Stock [Line Items] | ||||||
Shares issued | 59,740,259 | |||||
Registered Direct Offering | ||||||
Class of Stock [Line Items] | ||||||
Shares issued | 40,000,000 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details) | 1 Months Ended | 9 Months Ended | |||
Feb. 01, 2020 shares | Feb. 29, 2016 shares | Dec. 31, 2015 | Sep. 30, 2022 item shares | May 30, 2019 shares | |
2015 Equity Incentive Plan | |||||
Stock-based compensation | |||||
Expiration period | 10 years | ||||
Automatic annual increase in shares authorized, percent of common stock outstanding | 3.50% | ||||
Shares available for grant | 20,390,940 | ||||
Inducement Plan | |||||
Stock-based compensation | |||||
Shares available for grant | 701,071 | ||||
Total shares that may be issued | 1,800,000 | ||||
2016 Employee Stock Purchase Plan | |||||
Stock-based compensation | |||||
Shares available for grant | 800,000 | 13,050,523 | |||
Share increase (as a percent) | 1% | ||||
Payroll deductions for ESPP participants (as a percent) | 15% | ||||
Percentage on share price issued | 85% | ||||
Offering period duration | 6 months | ||||
Purchase periods | item | 2 | ||||
Stock issued | 566,573 | 93,053 | |||
1997 Stock Option Plan | |||||
Stock-based compensation | |||||
Options vested and expected to vest | 1,223,273 |
Fair Value Measurements - Recur
Fair Value Measurements - Recurring (Details) - USD ($) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2022 | Dec. 31, 2021 | Nov. 09, 2020 | |
Fair Value Measurements | |||
Cash and cash equivalents | $ 35,484 | $ 33,461 | |
Marketable securities | 127,566 | 148,327 | |
Derivative assets | 101 | 239 | |
Derivative liabilities | 83,794 | 236,291 | |
Energy Capital Facility | |||
Fair Value Measurements | |||
Derivative liabilities | 28,100 | 69,400 | $ 4,200 |
Recurring | Embedded conversion option | 2023 Notes | |||
Fair Value Measurements | |||
Derivative liabilities | 328 | 5,817 | |
Recurring | Embedded conversion option | PHC Notes | |||
Fair Value Measurements | |||
Derivative liabilities | 63,847 | 149,058 | |
Recurring | Embedded conversion option | 2025 Notes. | |||
Fair Value Measurements | |||
Derivative liabilities | 19,947 | 81,417 | |
Recurring | Money market funds | |||
Fair Value Measurements | |||
Cash and cash equivalents | 33,610 | 29,197 | |
Recurring | Corporate debt securities | |||
Fair Value Measurements | |||
Marketable securities | 36,784 | 57,369 | |
Recurring | Commercial paper | |||
Fair Value Measurements | |||
Marketable securities | 32,614 | 39,748 | |
Recurring | Asset backed Securities | |||
Fair Value Measurements | |||
Marketable securities | 13,849 | 26,707 | |
Recurring | Government and agency securities | |||
Fair Value Measurements | |||
Marketable securities | 44,319 | 24,503 | |
Recurring | PHC Option | |||
Fair Value Measurements | |||
Derivative assets | 101 | 239 | |
Recurring | Put Or Call Option | Energy Capital Facility | |||
Fair Value Measurements | |||
Derivative liabilities | 28,068 | 69,401 | |
Recurring | Level 1 | Money market funds | |||
Fair Value Measurements | |||
Cash and cash equivalents | 33,610 | 29,197 | |
Recurring | Level 1 | Government and agency securities | |||
Fair Value Measurements | |||
Marketable securities | 37,403 | 19,957 | |
Recurring | Level 2 | Embedded conversion option | 2023 Notes | |||
Fair Value Measurements | |||
Derivative liabilities | 328 | ||
Recurring | Level 2 | Embedded conversion option | 2025 Notes. | |||
Fair Value Measurements | |||
Derivative liabilities | 19,947 | 81,417 | |
Recurring | Level 2 | Corporate debt securities | |||
Fair Value Measurements | |||
Marketable securities | 36,784 | 57,369 | |
Recurring | Level 2 | Commercial paper | |||
Fair Value Measurements | |||
Marketable securities | 32,614 | 39,748 | |
Recurring | Level 2 | Asset backed Securities | |||
Fair Value Measurements | |||
Marketable securities | 13,849 | 26,707 | |
Recurring | Level 2 | Government and agency securities | |||
Fair Value Measurements | |||
Marketable securities | 6,916 | 4,546 | |
Recurring | Level 3 | |||
Reconciliation of items measured at fair value on a recurring basis that used significant unobservable inputs (Level 3) | |||
Balance at the beginning of the period | 224,037 | ||
Gain on fair value adjustment of option | (41,333) | ||
Gain on change in fair value of derivatives | (85,211) | ||
Financial asset (gain) impairment cost, net | 138 | ||
Change in fair value hierarchy classification | (5,817) | ||
Balance at the end of the period | 91,814 | ||
Recurring | Level 3 | Embedded conversion option | 2023 Notes | |||
Fair Value Measurements | |||
Derivative liabilities | 5,817 | ||
Recurring | Level 3 | Embedded conversion option | PHC Notes | |||
Fair Value Measurements | |||
Derivative liabilities | 63,847 | 149,058 | |
Recurring | Level 3 | PHC Option | |||
Fair Value Measurements | |||
Derivative assets | 101 | 239 | |
Recurring | Level 3 | Put Or Call Option | Energy Capital Facility | |||
Fair Value Measurements | |||
Derivative liabilities | $ 28,068 | $ 69,401 |
Fair Value Measurements - Valua
Fair Value Measurements - Valuation Assumptions (Details) - Recurring - Level 3 | Sep. 30, 2022 Y |
Stock price volatility | PHC Option | |
Fair value valuation assumptions | |
Embedded Derivative Liability, Measurement Input | 104 |
Probabilities of conversion provisions | Minimum | |
Fair value valuation assumptions | |
Embedded Derivative Liability, Measurement Input | 5 |
Probabilities of conversion provisions | Minimum | PHC Option | |
Fair value valuation assumptions | |
Embedded Derivative Liability, Measurement Input | 5 |
Probabilities of conversion provisions | Maximum | |
Fair value valuation assumptions | |
Embedded Derivative Liability, Measurement Input | 10 |
Probabilities of conversion provisions | Maximum | PHC Option | |
Fair value valuation assumptions | |
Embedded Derivative Liability, Measurement Input | 10 |
Time period until maturity (yrs) | PHC Option | |
Fair value valuation assumptions | |
Embedded Derivative Liability, Measurement Input | 0.25 |
Time period until maturity (yrs) | Minimum | |
Fair value valuation assumptions | |
Embedded Derivative Liability, Measurement Input | 0 |
Time period until maturity (yrs) | Maximum | |
Fair value valuation assumptions | |
Embedded Derivative Liability, Measurement Input | 0.11 |
PHC Notes | Stock price volatility | |
Fair value valuation assumptions | |
Embedded Derivative Liability, Measurement Input | 110 |
PHC Notes | Probabilities of conversion provisions | Minimum | |
Fair value valuation assumptions | |
Embedded Derivative Liability, Measurement Input | 5 |
PHC Notes | Probabilities of conversion provisions | Maximum | |
Fair value valuation assumptions | |
Embedded Derivative Liability, Measurement Input | 10 |
PHC Notes | Time period until maturity (yrs) | |
Fair value valuation assumptions | |
Embedded Derivative Liability, Measurement Input | 2.09 |
Energy Capital Facility | Stock price volatility | |
Fair value valuation assumptions | |
Embedded Derivative Liability, Measurement Input | 88 |
Income Taxes - Tax Provision (D
Income Taxes - Tax Provision (Details) - USD ($) | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Income Taxes | ||
Income tax provision | $ 0 | $ 0 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Related party transactions | |||||
Revenue | $ 4,496 | $ 3,256 | $ 10,263 | $ 8,471 | |
Due from related party | 2,021 | 2,021 | $ 1,768 | ||
Due to related party | 671 | 671 | 3,597 | ||
Ascensia | |||||
Related party transactions | |||||
Revenue | 10,300 | $ 8,500 | |||
Due from related party | 2,000 | 2,000 | 1,800 | ||
Due to related party | $ 700 | $ 700 | $ 2,500 |
Subsequent Events (Details)
Subsequent Events (Details) - Energy Capital, LLC - Series B Preferred Stock $ / shares in Units, $ in Millions | Nov. 07, 2022 USD ($) $ / shares |
Subsequent Event [Line Items] | |
Aggregate principal amount of convertible preferred equity | $ 12 |
Subsequent Event | |
Subsequent Event [Line Items] | |
Aggregate principal amount of convertible preferred equity | $ 12 |
Conversion price | $ / shares | $ 0.3951 |