Document And Entity Information
Document And Entity Information - shares | 6 Months Ended | |
Mar. 31, 2023 | May 10, 2023 | |
Document And Entity Information | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2023 | |
Document Transition Report | false | |
Entity File Number | 001-37759 | |
Entity Registrant Name | OUTLOOK THERAPEUTICS, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 38-3982704 | |
Entity Address, Address Line One | 485 Route 1 South | |
Entity Address, Address Line Two | Building F, Suite 320 | |
Entity Address, City or Town | Iselin | |
Entity Address, State or Province | NJ | |
Entity Address, Postal Zip Code | 08830 | |
City Area Code | 609 | |
Local Phone Number | 619-3990 | |
Title of 12(b) Security | Common Stock | |
Trading Symbol | OTLK | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 256,666,794 | |
Entity Central Index Key | 0001649989 | |
Current Fiscal Year End Date | --09-30 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Mar. 31, 2023 | Sep. 30, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 43,629,102 | $ 17,396,812 |
Prepaid expenses and other current assets | 9,423,025 | 10,123,634 |
Total current assets | 53,052,127 | 27,520,446 |
Operating lease right-of-use assets, net | 48,581 | 70,360 |
Equity method investment | 809,470 | 804,930 |
Other assets | 113,850 | 132,015 |
Total assets | 54,024,028 | 28,527,751 |
Current liabilities: | ||
Current portion of long-term debt | 31,823,000 | 10,915,015 |
Current portion of finance lease liabilities | 10,332 | 11,751 |
Current portion of operating lease liabilities | 3,929 | 26,995 |
Accounts payable | 3,619,748 | 3,491,485 |
Accrued expenses | 6,214,397 | 3,427,900 |
Income taxes payable | 1,856,629 | 1,856,629 |
Total current liabilities | 43,528,035 | 19,729,775 |
Finance lease liabilities | 4,267 | |
Warrant liability | 8,263 | 57,138 |
Total liabilities | 43,536,298 | 19,791,180 |
Commitments and contingencies (Note 8) | ||
Convertible preferred stock: | ||
Total convertible preferred stock | ||
Stockholders' equity: | ||
Preferred stock, value | ||
Common stock, par value $0.01 per share; 425,000,000 shares authorized; 256,666,794 and 227,310,572 shares issued and outstanding at March 31, 2023 and September 30, 2022, respectively | 2,566,667 | 2,273,105 |
Additional paid-in capital | 442,173,380 | 415,398,984 |
Accumulated deficit | (434,252,317) | (408,935,518) |
Total stockholders' equity | 10,487,730 | 8,736,571 |
Total liabilities, convertible preferred stock and stockholders' equity | 54,024,028 | 28,527,751 |
Series A convertible preferred stock | ||
Convertible preferred stock: | ||
Total convertible preferred stock | ||
Series A-1 convertible preferred stock | ||
Convertible preferred stock: | ||
Total convertible preferred stock | ||
Series B convertible preferred stock | ||
Stockholders' equity: | ||
Preferred stock, value |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parentheticals) - $ / shares | Mar. 31, 2023 | Sep. 30, 2022 |
Preferred stock, par value per share (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 7,300,000 | 7,300,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock shares outstanding | 0 | 0 |
Common stock, par value per share (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 425,000,000 | 425,000,000 |
Common stock, shares issued | 256,666,794 | 227,310,572 |
Common stock, shares outstanding | 256,666,794 | 227,310,572 |
Series A convertible preferred stock | ||
Convertible stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Convertible preferred stock, shares authorized | 1,000,000 | 1,000,000 |
Convertible preferred stock, shares issued | 0 | 0 |
Convertible preferred stock outstanding | 0 | 0 |
Series A-1 convertible preferred stock | ||
Convertible stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Convertible preferred stock, shares authorized | 200,000 | 200,000 |
Convertible preferred stock, shares issued | 0 | 0 |
Convertible preferred stock outstanding | 0 | 0 |
Series B convertible preferred stock | ||
Preferred stock, par value per share (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 1,500,000 | 1,500,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock shares outstanding | 0 | 0 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Mar. 31, 2023 | Mar. 31, 2022 | |
Operating expenses: | ||||
Research and development | $ 544,948 | $ 12,219,666 | $ 10,407,372 | $ 22,092,142 |
General and administrative | 6,292,982 | 6,689,914 | 12,118,586 | 9,967,119 |
Loss from operations | (6,837,930) | (18,909,580) | (22,525,958) | (32,059,261) |
(Income) loss on equity method investment | 16,965 | 6,044 | (4,540) | 29,699 |
Interest (income) expense, net | (187,794) | 418,327 | 2,260,797 | 769,861 |
Loss on extinguishment of debt | 577,659 | 1,025,402 | ||
Change in fair value of promissory notes | 3,000 | 343,585 | 3,000 | 505,940 |
Change in fair value of warrant liability | (18,615) | 25,013 | (48,875) | (224,885) |
Loss before income taxes | (6,651,486) | (19,702,549) | (25,313,999) | (34,165,278) |
Income tax expense | 2,800 | 2,000 | 2,800 | 2,000 |
Net loss | $ (6,654,286) | $ (19,704,549) | $ (25,316,799) | $ (34,167,278) |
Per share information: | ||||
Net loss per share of common stock, basic (in dollars per share) | $ (0.03) | $ (0.09) | $ (0.10) | $ (0.17) |
Net loss per share of common stock, diluted (in dollars per share) | $ (0.03) | $ (0.09) | $ (0.10) | $ (0.17) |
Weighted average shares outstanding, basic (in shares) | 256,666,794 | 219,067,900 | 241,877,917 | 203,443,077 |
Weighted average shares outstanding, diluted (in shares) | 256,666,794 | 219,067,900 | 241,877,917 | 203,443,077 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Total |
Balance at Sep. 30, 2021 | $ 1,764,616 | $ 345,726,087 | $ (342,883,254) | $ 4,607,449 |
Balance, beginning (in shares) at Sep. 30, 2021 | 176,461,628 | |||
Increase (Decrease) in Stockholders' Equity | ||||
Issuance of common stock in connection with exercise of stock options | $ 250 | 17,500 | 17,750 | |
Issuance of common stock in connection with exercise of stock options (in shares) | 25,000 | |||
Sale of common stock, net of issuance costs | $ 477,740 | 56,979,163 | 57,456,903 | |
Sale of common stock, net of issuance costs (in shares) | 47,773,974 | |||
Stock-based compensation expense | 1,204,048 | 1,204,048 | ||
Net loss | (14,462,729) | (14,462,729) | ||
Balance at Dec. 31, 2021 | $ 2,242,606 | 403,926,798 | (357,345,983) | 48,823,421 |
Balance, ending (in shares) at Dec. 31, 2021 | 224,260,602 | |||
Balance at Sep. 30, 2021 | $ 1,764,616 | 345,726,087 | (342,883,254) | 4,607,449 |
Balance, beginning (in shares) at Sep. 30, 2021 | 176,461,628 | |||
Increase (Decrease) in Stockholders' Equity | ||||
Net loss | (34,167,278) | |||
Balance at Mar. 31, 2022 | $ 2,257,927 | 410,755,286 | (377,050,532) | 35,962,681 |
Balance, ending (in shares) at Mar. 31, 2022 | 225,792,742 | |||
Balance at Dec. 31, 2021 | $ 2,242,606 | 403,926,798 | (357,345,983) | 48,823,421 |
Balance, beginning (in shares) at Dec. 31, 2021 | 224,260,602 | |||
Increase (Decrease) in Stockholders' Equity | ||||
Issuance of common stock in connection with exercise of warrants | $ 157 | 187,943 | 188,100 | |
Issuance of common stock in connection with exercise of warrants (in shares) | 15,675 | |||
Sale of common stock, net of issuance costs | $ 15,164 | 2,877,750 | 2,892,914 | |
Sale of common stock, net of issuance costs (in shares) | 1,516,465 | |||
Stock-based compensation expense | 3,762,795 | 3,762,795 | ||
Net loss | (19,704,549) | (19,704,549) | ||
Balance at Mar. 31, 2022 | $ 2,257,927 | 410,755,286 | (377,050,532) | 35,962,681 |
Balance, ending (in shares) at Mar. 31, 2022 | 225,792,742 | |||
Balance at Sep. 30, 2022 | $ 2,273,105 | 415,398,984 | (408,935,518) | 8,736,571 |
Balance, beginning (in shares) at Sep. 30, 2022 | 227,310,572 | |||
Increase (Decrease) in Stockholders' Equity | ||||
Sale of common stock, net of issuance costs | $ 293,562 | 23,998,598 | 24,292,160 | |
Sale of common stock, net of issuance costs (in shares) | 29,356,222 | |||
Stock-based compensation expense | 1,392,393 | 1,392,393 | ||
Net loss | (18,662,513) | (18,662,513) | ||
Balance at Dec. 31, 2022 | $ 2,566,667 | 440,789,975 | (427,598,031) | 15,758,611 |
Balance, ending (in shares) at Dec. 31, 2022 | 256,666,794 | |||
Balance at Sep. 30, 2022 | $ 2,273,105 | 415,398,984 | (408,935,518) | 8,736,571 |
Balance, beginning (in shares) at Sep. 30, 2022 | 227,310,572 | |||
Increase (Decrease) in Stockholders' Equity | ||||
Net loss | (25,316,799) | |||
Balance at Mar. 31, 2023 | $ 2,566,667 | 442,173,380 | (434,252,317) | 10,487,730 |
Balance, ending (in shares) at Mar. 31, 2023 | 256,666,794 | |||
Balance at Dec. 31, 2022 | $ 2,566,667 | 440,789,975 | (427,598,031) | 15,758,611 |
Balance, beginning (in shares) at Dec. 31, 2022 | 256,666,794 | |||
Increase (Decrease) in Stockholders' Equity | ||||
Stock-based compensation expense | 1,383,405 | 1,383,405 | ||
Net loss | (6,654,286) | (6,654,286) | ||
Balance at Mar. 31, 2023 | $ 2,566,667 | $ 442,173,380 | $ (434,252,317) | $ 10,487,730 |
Balance, ending (in shares) at Mar. 31, 2023 | 256,666,794 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 6 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
OPERATING ACTIVITIES | ||
Net loss | $ (25,316,799) | $ (34,167,278) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 21,779 | 101,953 |
Loss on extinguishment of debt | 577,659 | 1,025,402 |
Non-cash interest expense | 2,529,830 | 763,104 |
Stock-based compensation | 2,775,798 | 4,966,843 |
Change in fair value of promissory notes | 3,000 | 505,940 |
Change in fair value of warrant liability | (48,875) | (224,885) |
(Income) loss on equity method investment | (4,540) | 29,699 |
Interest paid on debt | (1,158,609) | |
Changes in operating assets and liabilities: | ||
Prepaid expenses and other assets | 713,199 | (1,092,452) |
Operating lease liabilities | (23,066) | (20,749) |
Accounts payable | 128,263 | 1,963,638 |
Accrued expenses | 2,786,497 | 824,155 |
Net cash used in operating activities | (17,015,864) | (25,324,630) |
FINANCING ACTIVITIES | ||
Proceeds from the sale of common stock, net of issuance costs | 24,297,734 | 60,382,548 |
Proceeds from debt | 30,000,000 | 10,000,000 |
Proceeds from exercise of common stock warrants | 188,100 | |
Proceeds from exercise of stock options | 17,750 | |
Payments of finance lease obligations | (5,686) | (13,728) |
Repayment of debt | (10,220,000) | (703,267) |
Payment of financing costs | (823,894) | (600,000) |
Net cash provided by financing activities | 43,248,154 | 69,271,403 |
Net increase in cash and cash equivalents | 26,232,290 | 43,946,773 |
Cash and cash equivalents at beginning of year | 17,396,812 | 14,477,324 |
Cash and cash equivalents at end of period | 43,629,102 | 58,424,097 |
Supplemental disclosure of cash flow information: | ||
Cash paid for interest | 1,159,008 | 22,017 |
Supplemental schedule of non-cash financing activities: | ||
Deferred offering costs amortization | $ 5,573 | $ 32,731 |
Organization and Description of
Organization and Description of Business | 6 Months Ended |
Mar. 31, 2023 | |
Organization and Description of Business | |
Organization and Description of Business | 1. Organization and Description of Business Outlook Therapeutics, Inc. (“Outlook” or the “Company”) was incorporated in New Jersey on January 5, 2010, started operations in July 2011, reincorporated in Delaware by merging with and into a Delaware corporation in October 2015 and changed its name to “Outlook Therapeutics, Inc.” in November 2018. The Company is a biopharmaceutical company focused on developing and commercializing ONS-5010, an ophthalmic formulation of bevacizumab for use in retinal indications. The Company is based in Iselin, New Jersey. All development activities are currently active in support of the Company’s Biologics License Application (“BLA”) registration program for ONS-5010 for wet age-related macular degeneration (“wet AMD”). In fiscal year 2022, the Company submitted the BLA and received confirmation from the U.S. Food and Drug Administration (“FDA”) that the BLA had been accepted for filing with a goal date of August 29, 2023 for a review decision by the FDA. Additionally, the Company submitted a Marketing Authorization Application (“MAA”) with the European Medicines Agency (“EMA”), which has been validated for review with an estimated decision date expected in early 2024. |
Liquidity
Liquidity | 6 Months Ended |
Mar. 31, 2023 | |
Liquidity | |
Liquidity | 2. Liquidity The Company has incurred recurring losses and negative cash flows from operations since its inception and has an accumulated deficit of $434,252,317 as of March 31, 2023. As of March 31, 2023, the Company had $35,056,257 of principal, accrued interest and exit fees due under an unsecured convertible promissory note issued in December 2022 (the “December 2022 Note”), maturing on January 1, 2024. As a result, there is substantial doubt about the Company’s ability to continue as a going concern. The accompanying unaudited interim consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. The unaudited interim consolidated financial statements do not include any adjustments related to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of this uncertainty. Management believes that the Company’s existing cash and cash equivalents as of March 31, 2023 will be sufficient to fund its operations through the anticipated approval of the BLA for ONS-5010 in the third calendar quarter of 2023 and potentially through the fourth calendar quarter of 2023. As a result, additional financing will be needed by the Company to fund its operations in the future and to commercially develop ONS-5010 and to develop any other product candidates. Management is currently evaluating different strategies to obtain the required funding for future operations, including but not limited to, continuing to access capital through at-the-market offering agreements (refer to Note 9 for further details), proceeds from potential licensing and/or marketing arrangements or collaborations with pharmaceutical or other companies, the issuance of equity securities, the issuance of additional debt, and revenues from potential future product sales, if any. There can be no assurance that these future funding efforts will be successful. The Company’s future operations are highly dependent on a combination of factors, including (i) the timely and successful completion of additional financing discussed above; (ii) the Company’s ability to successfully begin marketing of its product candidates or complete revenue-generating partnerships with other companies; (iii) the success of its research and development; (iv) the development of competitive therapies by other biotechnology and pharmaceutical companies; and, ultimately, (v) regulatory approval and market acceptance of the Company’s proposed future products. |
Basis of Presentation and Summa
Basis of Presentation and Summary of Significant Accounting Policies | 6 Months Ended |
Mar. 31, 2023 | |
Basis of Presentation and Summary of Significant Accounting Policies | |
Basis of Presentation and Summary of Significant Accounting Policies | 3. Basis of Presentation and Summary of Significant Accounting Policies Basis of presentation The accompanying unaudited interim consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Any reference in these notes to applicable guidance is meant to refer to GAAP as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Updates (“ASU”) of the Financial Accounting Standards Board (“FASB”). In the opinion of management, the accompanying unaudited interim consolidated financial statements include all normal and recurring adjustments (which consist primarily of accruals, estimates and assumptions that impact the financial statements) considered necessary to present fairly the Company’s financial position as of March 31, 2023 and its results of operations for the three and six months ended March 31, 2023 and 2022, cash flows for the six months ended March 31, 2023 and 2022, and stockholders’ equity for the three and six months ended March 31, 2023 and 2022. Operating results for the six months ended March 31, 2023 are not necessarily indicative of the results that may be expected for the full year ending September 30, 2023. The unaudited interim consolidated financial statements presented herein do not contain all of the required disclosures under GAAP for annual consolidated financial statements. The accompanying unaudited interim consolidated financial statements should be read in conjunction with the annual audited consolidated financial statements and related notes as of and for the year ended September 30, 2022 included in the Company’s Annual Report on Form 10-K filed with the SEC on December 29, 2022. Use of estimates The preparation of the unaudited interim consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Due to the uncertainty of factors surrounding the estimates or judgments used in the preparation of the unaudited interim consolidated financial statements, such as the current macroeconomic environment, including as a result of the ongoing COVID-19 pandemic or political disruption such as the war between Ukraine and Russia, actual results may materially vary from these estimates. Estimates and assumptions are periodically reviewed, and the effects of revisions are reflected in the unaudited interim consolidated financial statements in the period they are determined to be necessary. Net loss per share Basic and diluted net loss per common share is determined by dividing net loss attributable to common stockholders by the weighted-average number of shares of common stock outstanding during the period. For purposes of calculating diluted loss per common share, the denominator includes both the weighted average common shares outstanding and the number of common stock equivalents if the inclusion of such common stock equivalents would be dilutive. Potentially dilutive securities include warrants, performance-based stock options and units, stock options and non-vested restricted stock unit (“RSU”) awards using the treasury stock method. For all periods presented, there is no difference in the number of shares used to compute basic and diluted shares due to the Company’s loss. The following table sets forth the computation of basic loss per share and diluted loss per share: Three months ended March 31, Six months ended March 31, 2023 2022 2023 2022 Net loss attributable to common stockholders $ (6,654,286) $ (19,704,549) $ (25,316,799) $ (34,167,278) Common stock shares outstanding (weighted average) 256,666,794 219,067,900 241,877,917 203,443,077 Basic and diluted net loss per share $ (0.03) $ (0.09) $ (0.10) $ (0.17) The following potentially dilutive securities (in common stock equivalents) have been excluded from the computation of diluted weighted-average shares outstanding as of March 31, 2023 and 2022, as they would be antidilutive: As of March 31, 2023 2022 Performance-based stock units 2,470 2,470 Performance-based stock options 1,900,000 1,900,000 Stock options 22,064,850 19,783,581 Common stock warrants 7,328,549 6,812,794 Convertible debt 16,305,235 (i) — (i) The potentially dilutive securities related to convertible debt are calculated based on a fixed conversion price of $2.00 per share, which is subject to change as described in Note 7. Recently issued accounting pronouncements In August 2020, the FASB issued ASU 2020-06, Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815 - 40) There have been no other accounting pronouncements issued but not yet adopted by the Company which are expected to have a material impact on the Company’s consolidated financial position, results of operations or cash flows. |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Mar. 31, 2023 | |
Fair Value Measurements | |
Fair Value Measurements | 4. Fair Value Measurements Certain assets and liabilities are carried at fair value under GAAP. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. Financial assets and liabilities carried at fair value are to be classified and disclosed in one of the following three levels of the fair value hierarchy, of which the first two are considered observable and the last is considered unobservable: ● Level 1 - Quoted prices in active markets for identical assets or liabilities. ● Level 2 - Observable inputs (other than Level 1 quoted prices), such as quoted prices in active markets for similar assets or liabilities, quoted prices in markets that are not active for identical or similar assets or liabilities, or other inputs that are observable or can be corroborated by observable market data. ● Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to determining the fair value of the assets or liabilities, including pricing models, discounted cash flow methodologies and similar techniques. The asset’s or liability’s fair value measurement level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Valuation techniques used need to maximize the use of observable inputs and minimize the use of unobservable inputs. The following table presents the Company’s liabilities that are measured at fair value on a recurring basis: March 31, 2023 (Level 1) (Level 2) (Level 3) Liabilities Unsecured convertible promissory note $ — $ — $ 31,823,000 Warrant liability — — 8,263 Total $ — $ — $ 31,831,263 September 30, 2022 (Level 1) (Level 2) (Level 3) Liabilities Unsecured convertible promissory note $ — $ — $ — Warrant liability — — 57,138 Total $ — $ — $ 57,138 The table presented below is a summary of changes in the fair value of the Company’s Level 3 valuation for the warrant liability and unsecured convertible promissory note for the six months ended March 31, 2023: Unsecured Convertible Promissory Note Warrants Balance at October 1, 2022 $ — $ 57,138 Fair value at issuance date 31,820,000 — Change in fair value 3,000 (48,875) Balance at March 31, 2023 $ 31,823,000 $ 8,263 As further described in Note 7, the Company elected the fair value option to account for the December 2022 Note. The fair value of the December 2022 Note is estimated using a binomial lattice model, which evaluates the payouts under hold, convert or call decisions. Significant estimates in the binomial lattice model include the Company’s stock price, volatility, risk-free rate of return, and credit-adjusted discount rate. The fair value of the December 2022 Note as of March 31, 2023 was estimated using a binomial lattice model with the following assumptions: March 31, 2023 Term (years) 0.8 Stock price $ 1.09 Volatility 57.0 % Risk-free rate 4.8 % Dividend yield — % Credit-adjusted discount rate 23.3 % The warrants issued in connection with the convertible senior secured notes originally issued pursuant to that certain Note and Warrant Purchase Agreement dated December 22, 2017 are classified as liabilities on the accompanying unaudited interim consolidated balance sheets as the warrants include cash settlement features at the option of the holders under certain circumstances. The warrant liability is revalued each reporting period with the change in fair value recorded in the accompanying consolidated statements of operations until the warrants are exercised or expire. The fair value of the warrant liability is estimated using the Black-Scholes option pricing model using the following assumptions: March 31, 2023 September 30, 2022 Risk-free interest rate 4.14 % 4.23 % Remaining contractual term of warrants (years) 1.9 2.4 Expected volatility 76.1 % 92.5 % Annual dividend yield — % — % Fair value of common stock (per share) $ 1.09 $ 1.22 |
Equity Method Investment
Equity Method Investment | 6 Months Ended |
Mar. 31, 2023 | |
Equity Method Investment | |
Equity Method Investment | 5. Equity Method Investment In connection with the execution of a stock purchase agreement with Syntone Ventures LLC (“Syntone Ventures”), the United States-based affiliate of Syntone Technologies Group Co. Ltd. (“Syntone PRC”) on May 22, 2020, the Company and Syntone PRC entered into a joint venture agreement pursuant to which they agreed to form a People’s Republic of China (“PRC”) joint venture, Beijing Syntone Biopharma Ltd (“Syntone”), that is 80% owned by Syntone PRC and 20% owned by the Company. As the Company can exert significant influence over, but does not control, Syntone’s operations through voting rights or representation on Syntone’s board of directors, the Company accounts for this investment using the equity method of accounting. Upon formation of Syntone in April 2021, the Company entered into a royalty-free license with Syntone for the development, commercialization and manufacture of ONS-5010 in the greater China market, which includes Hong Kong, Taiwan and Macau. The Company made the initial investment of $900,000 in June 2020 and expects to be required to make an additional capital contribution to Syntone of approximately $2,100,000, which will be made within four years after the establishment date in accordance with the development plan contemplated in the license agreement or on such other terms within such four-year period. The maximum exposure to a loss as a result of the Company’s involvement in Syntone is limited to the initial investment and the future capital contributions of approximately $2,100,000. |
Accrued Expenses
Accrued Expenses | 6 Months Ended |
Mar. 31, 2023 | |
Accrued Expenses | |
Accrued Expenses | 6. Accrued Expenses Accrued expenses consists of: March 31, 2023 September 30, 2022 Compensation $ 1,661,984 $ 1,976,252 Research and development 3,836,228 744,154 Professional fees 559,181 564,423 Other accrued expenses 157,004 143,071 $ 6,214,397 $ 3,427,900 |
Debt
Debt | 6 Months Ended |
Mar. 31, 2023 | |
Debt | |
Debt | 7. Debt Debt consists of: March 31, 2023 September 30, 2022 Unsecured convertible promissory note (measured at fair value) $ 31,823,000 $ — Unsecured promissory note — 11,114,518 Total debt 31,823,000 11,114,518 Less: unamortized loan costs — (199,503) Total debt, net of unamortized loan costs 31,823,000 10,915,015 Less: current portion (31,823,000) (10,915,015) Long-term debt $ — $ — Unsecured convertible promissory note On December 22, 2022, the Company entered into a Securities Purchase Agreement and issued the December 2022 Note with a face amount of $31,820,000, to Streeterville Capital, LLC (the “Lender”), the holder of the Company’s unsecured promissory note issued in November 2021 (the “November 2021 Note”). The December 2022 Note has an original issue discount of $1,820,000. The Company received net proceeds of $18,052,461 upon the closing on December 28, 2022 after deducting the Lender’s transaction costs in connection with the issuance and a full payment of the remaining outstanding principal and accrued interest on the November 2021 Note. The November 2021 Note was cancelled upon repayment. See below for additional disclosures relating to November 2021 Note. The December 2022 Note bears interest at 9.5% per annum and matures on January 1, 2024. The December 2022 Note contains customary covenants, including a restriction on the Company’s ability to pledge certain of the Company’s assets, subject to certain exceptions, without the Lender’s consent. Beginning on April 1, 2023, the Lender will have the right to convert the December 2022 Note at the Conversion Price (as defined below). The principal amount and conversion price of the December 2022 Note are subject to adjustment upon certain triggering events. In addition, the Company has the right to convert all or any portion of the outstanding balance under the December 2022 Note into shares of common stock at the Conversion Price if certain conditions have been met at the time of conversion, including if at any time after the six-month anniversary of the closing date, the daily volume-weighted average price of the common stock on Nasdaq equals or exceeds $2.50 per share (subject to adjustments for stock splits and stock combinations) for a period of 30 consecutive trading days. Payments may be made by the Company (i) in cash, (ii) in shares of common stock, with the number of shares being equal to the portion of the applicable payment amount divided by the Conversion Price (as defined below), or (iii) a combination of cash and shares of common stock. Any payments made by the Company in cash, including prepayments or repayment at maturity, will be subject to an additional fee of 7.5%. Upon the occurrence of certain events described in the December 2022 Note, including, among others, the Company’s failure to pay amounts due and payable under the December 2022 Note, events of insolvency or bankruptcy, failure to observe covenants contained in the Securities Purchase Agreement and the December 2022 Note, breaches of representations and warranties in the Securities Purchase Agreement, and the occurrence of certain transactions without the Lender’s consent, each such event, a Trigger Event, the Lender shall have the right, subject to certain exceptions, to increase the balance of the December 2022 Note by 10% for a Major Trigger Event (as defined in the December 2022 Note) and 5% for a Minor Trigger Event (as defined in the December 2022 Note). If a Trigger Event is not cured within ten (10) trading days of written notice thereof from the Lender, it will result in an event of default (such event, an “Event of Default”). Following an Event of Default, the Lender may accelerate the December 2022 Note such that all amounts thereunder become immediately due and payable, and interest shall accrue at a rate of 22% annually until paid. Under the December 2022 Note, “Conversion Price” means, prior to a Major Trigger Event, $2.00 per share (subject to adjustment for stock splits and stock combinations), and following a Major Trigger Event, the lesser of (i) $2.00 per share (subject to adjustment for stock splits and stock combinations), and (ii) 90% multiplied by the lowest closing bid price of the Company’s common stock in the three trading days prior to the date on which the conversion notice is delivered. If the Conversion Price is below $0.1756 per share, the Company will be required to satisfy a conversion notice from the Lender in cash. Subject to certain exceptions, while the December 2022 Note is outstanding, the Lender will have a consent right on any future variable rate transactions or any debt and a 10% participation right in any future debt or equity financings. The Company elected to account for the December 2022 Note at fair value (Note 4) and was not required to bifurcate the conversion option as a derivative and as result the original issue discount of $1,820,000 and debt issuance costs were written off upon election to fair value and accounted for as interest. During the six months ended March 31, 2023 the Company recognized $2,074,964 of interest expense related to the December 2022 Note related to original issue discount of $1,820,000 and other third party debt issuance costs of $254,964 as the Company elected the fair value option. Unsecured promissory note On November 16, 2021, the Company received $10,000,000 in net proceeds from the issuance of the November 2021 Note with a face amount of $10,220,000. Debt issuance costs totaling $820,000 were recorded as debt discount and were deducted from the principal in the accompanying consolidated balance sheet as of September 30, 2022. The debt discount was amortized as a component of interest expense over the term of the underlying debt using the effective interest method. The November 2021 Note bore interest at a rate of 9.5% per annum compounding daily and was set to mature on January 1, 2023. The Company could prepay all or a portion of the November 2021 Note at any time by paying 105% of the outstanding balance elected for pre-payment. As discussed above, the November 2021 Note was cancelled using proceeds from the December 2022 Note issued to the same lender. The total repayment was $11,947,539, which represented 105% of the outstanding balance and included $1,158,609 of interest expense. The transaction has been accounted for as an extinguishment of the November 2021 Note. As a result, the Company recorded a loss on debt extinguishment of $577,659, which included $8,729 of unamortized debt discount, and prepayment fees of $568,930. During the three months ended March 31, 2022, the Company recognized $418,388 of interest expense related to the November 2021 Note of which $169,857 was related to the amortization of debt discount. During the six months ended March 31, 2023 and 2022, the Company recognized $454,866 and $763,104, respectively, of interest expense related to the November 2021 Note of which $190,775 and $277,980, respectively, were related to the amortization of debt discount. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Mar. 31, 2023 | |
Commitments and Contingencies | |
Commitments and Contingencies | 8. Commitments and Contingencies Leases Corporate office In March 2021, the Company entered into a three-year term corporate office lease in Iselin, New Jersey that commenced on April 23, 2021. Equipment leases The Company has equipment leases, with terms between 12 and 36 months, recorded as finance leases. The equipment leases bear interest between 4.0% and 13.0% per annum. Certain lease agreements contain provisions for future rent increases. Payments due under the lease contracts include minimum payments that the Company is obligated to make under the non-cancelable initial terms of the leases as the renewal terms are at the Company’s option. Lease expense is recorded as research and development or general and administrative based on the use of the leased asset. The components of lease cost for the three and six months ended March 31, 2023 and 2022 are as follows: Three months ended March 31, Six months ended March 31, 2023 2022 2023 2022 Lease cost: Amortization of right-of-use assets $ — $ — $ — $ — Interest on lease liabilities 398 849 889 1,823 Total finance lease cost 398 849 889 1,823 Operating lease cost 11,216 11,217 22,433 22,433 Total lease cost $ 11,614 $ 12,066 $ 23,322 $ 24,256 Amounts reported in the unaudited interim consolidated balance sheets for leases where the Company is the lessee are as follows: March 31, 2023 September 30, 2022 Operating leases: Right-of-use asset $ 48,581 $ 70,360 Operating lease liabilities 3,929 26,995 Finance leases: Right-of-use asset $ — $ — Financing lease liabilities 10,332 16,018 Weighted-average remaining lease term (years): Operating leases 1.1 1.6 Finance leases 0.8 1.3 Weighted-average discount rate: Operating leases 7.5% 7.5% Finance leases 13.0% 13.0% Other information related to leases for the six months ended March 31, 2023 and 2022 are as follows: Six months ended March 31, 2023 2022 Cash paid for amounts included in the measurement of lease obligations: Operating cash flows from finance leases $ 889 $ 1,823 Operating cash flows from operating leases 23,721 23,043 Future minimum lease payments under non-cancelable leases as of March 31, 2023 are as follows for the years ending September 30: Operating leases Finance leases 2023 (remaining six months) $ 3,954 $ 6,575 2024 — 4,383 Total undiscounted lease payments 3,954 10,958 Less: Imputed interest 25 626 Total lease obligations $ 3,929 $ 10,332 |
Common Stock and Stockholders'
Common Stock and Stockholders' Equity | 6 Months Ended |
Mar. 31, 2023 | |
Common Stock and Stockholders' Equity | |
Common Stock and Stockholders' Equity | 9. Common Stock and Stockholders’ Equity Common stock On March 29, 2023, following receipt of stockholder approval at the Company’s 2023 annual meeting of stockholders, the number of authorized shares of common stock under the Company’s Certificate of Incorporation was increased from 325,000,000 shares to 425,000,000 shares. In December 2022, in a registered direct equity offering to certain institutional and accredited investors, including GMS Ventures and Investments (“GMS Ventures”), the Company’s largest stockholder, the Company issued 28,460,831 shares of common stock at a purchase price per share of $0.8784 for $23,547,904 in net proceeds after payment of placement agent fees and other offering costs. GMS Ventures purchased an aggregate of 14,230,418 shares of common stock in the registered direct equity offering. In connection with the registered direct equity offering, the Company issued to M.S. Howells & Co., the placement agent, warrants to purchase up to an aggregate of 515,755 shares of common stock at an exercise price of $1.05 per share, which warrants have a three-year term. In November 2021, the Company issued 46,000,000 shares of common stock in an underwritten public offering at a purchase price per share of $1.25 for $53,968,057 in net proceeds after payment of underwriter discounts and commissions and other underwriter offering costs. GMS Ventures purchased an aggregate of 16,000,000 shares of common stock in the public offering at the public offering price per share. In connection with the underwritten public offering, the Company issued the underwriter warrants to purchase up to an aggregate of 2,100,000 shares of common stock at an exercise price of $1.5625 per share, which warrants have a five-year term. H.C. Wainwright & Co. At-the-Market Offering Agreement On March 26, 2021, the Company entered into an At-the-Market Offering Agreement (the “ATM Agreement” or the “ATM Offering”), with H.C. Wainwright & Co., as sales agent (“Wainwright” or the “Agent”) under which the Company may issue and sell shares of its common stock having an aggregate offering price of up to $40,000,000 from time to time through Wainwright. The Company incurred financing costs of $197,654, which were capitalized and are being reclassified to additional paid in capital on a pro rata basis when the Company sells common stock under the ATM Offering. As of March 31, 2023, $113,850 of such deferred costs are included in other assets on the unaudited interim consolidated balance sheets. Under the ATM Agreement, the Company pays Wainwright a commission equal to 3.0% of the aggregate gross proceeds of any sales of common stock under the ATM Agreement. The offering of common stock pursuant to the ATM Agreement will terminate upon the earlier of (i) the sale of all common stock subject to the ATM Agreement or (ii) termination of the ATM Agreement in accordance with its terms. No shares of common stock were sold under the ATM Offering during the three months ended March 31, 2023. During the six months ended March 31, 2023, the Company sold 895,391 shares of common stock under the ATM Offering and generated $1,127,904 in gross proceeds. The Company paid fees to the Agent and other issuance costs of $38,799. During the six months ended March 31, 2022, the Company sold 3,290,439 shares of common stock under the ATM Offering and generated $6,626,696 in gross proceeds. The Company paid fees to the Agent and other issuance costs of $212,206. The Company terminated the ATM Agreement effective May 15, 2023. Common stock warrants As of March 31, 2023, shares of common stock issuable upon the exercise of outstanding warrants were as follows: Shares of common stock issuable upon exercise of Exercise Price Expiration Date warrants Per Share December 22, 2024 (i) 277,128 $ 12.00 February 26, 2024 1,747,047 $ 0.9535 February 24, 2025 172,864 $ 1.27 April 13, 2025 (i) 145,686 $ 12.00 May 31, 2025 (i) 62,437 $ 12.00 June 22, 2025 191,268 $ 1.51875 December 28, 2025 515,755 $ 1.0500 January 28, 2026 2,116,364 $ 1.25 November 23, 2026 2,100,000 $ 1.5625 7,328,549 (i) The warrants were issued in connection with the convertible senior secured notes originally issued pursuant to the certain Note and Warrant Purchase Agreement dated December 22, 2017 and are classified as liabilities on the accompanying unaudited interim consolidated balance sheets, as the warrants include cash settlement features at the option of the holders under certain circumstances. Refer to Note 4 for fair value measurements disclosures. |
Stock-Based Compensation
Stock-Based Compensation | 6 Months Ended |
Mar. 31, 2023 | |
Stock-Based Compensation | |
Stock-Based Compensation | 10. Stock-Based Compensation 2011 Equity Incentive Plan The Company’s 2011 Equity Compensation Plan (the “2011 Plan”) provided for the Company to sell or issue restricted common stock, RSUs, performance-based awards (“PSUs”), cash-based awards or to grant stock options for the purchase of common stock to officers, employees, consultants and directors of the Company. The 2011 Plan was administered by the board of directors or, at the discretion of the board of directors, by a committee of the board. As of March 31, 2023, PSUs representing 2,470 shares of the Company’s common stock were outstanding under the 2011 Plan. Effective with the December 2015 adoption of the 2015 Equity Incentive Plan, (the “2015 Plan”), no future awards under the 2011 Plan will be granted. 2015 Equity Incentive Plan In December 2015, the Company adopted the 2015 Plan. The 2015 Plan provides for the grant of stock options, stock appreciation rights, restricted stock awards, RSU awards, performance stock awards and other forms of equity compensation to Company employees, directors and consultants. The aggregate number of shares of common stock authorized for issuance pursuant to the Company’s 2015 Plan is 42,265,841. As of March 31, 2023, 18,106,339 shares remained available for grant under the 2015 Plan. Stock options and RSUs are granted under the Company’s 2015 Plan and generally vest over a period of one The Company recorded stock-based compensation expense in the following expense categories of its unaudited interim consolidated statements of operations for the three and six months ended March 31, 2023 and 2022: Three months ended March 31, Six months ended March 31, 2023 2022 2023 2022 Research and development $ 322,268 $ 1,820,262 $ 612,924 $ 2,072,657 General and administrative 1,061,137 1,942,533 2,162,874 2,894,186 $ 1,383,405 $ 3,762,795 $ 2,775,798 $ 4,966,843 Stock options As of March 31, 2023 options to purchase common stock of the Company outstanding under the 2015 Plan were as follows: Weighted Average Weighted Remaining Number of Average Contractual Aggregate Shares Exercise Price Term (Years) Intrinsic Value Balance at October 1, 2022 20,124,581 $ 1.49 Granted 1,940,269 1.15 Balance at March 31, 2023 22,064,850 $ 1.46 8.0 $ 3,412,868 Vested and exercisable at March 31, 2023 11,901,123 $ 1.48 7.6 $ 2,169,900 Vested and expected to vest at March 31, 2023 22,064,850 $ 1.46 8.0 $ 3,412,868 The aggregate intrinsic value represents the total amount by which the fair value of the common stock subject to options exceeds the exercise price of the related options. The weighted average grant date fair value of the options awarded to employees for the six months ended March 31, 2023 and 2022 was $0.96 and $1.25 per option, respectively. The fair value of the options was estimated on the date of grant using a Black-Scholes option pricing model with the following weighted-average assumptions: Six months ended March 31, 2023 2022 Risk-free interest rate 3.7 % 1.6 % Expected term (years) 5.7 6.0 Expected volatility 112.4 % 95.7 % Expected dividend yield — — As of March 31, 2023, there was $10,112,008 of unrecognized compensation expense that is expected to be recognized over a weighted-average period of 2.4 years. Performance-based stock options The Company granted certain officers of the Company option awards whose vesting is contingent upon meeting company-wide performance goals. The performance stock options were granted “at-the-money” and have a term of 10 years. The fair value of each option grant under the performance share option plan was estimated on the date of grant using the same option valuation model used for non-statutory options above. Compensation expense for performance-based stock options is only recognized when management determines it is probable that the awards will vest. A summary of the activity under the performance share option plan as of March 31, 2023 and changes during the six months then ended are presented below. Weighted Average Weighted Remaining Number of Average Contractual Aggregate Shares Exercise Price Term (Years) Intrinsic Value Balance at October 1, 2022 700,000 $ 1.44 Granted 1,200,000 1.04 Balance at March 31, 2023 1,900,000 $ 1.19 9.3 $ 60,000 Vested and exercisable at March 31, 2023 700,000 $ 1.44 8.7 $ — Vested and expected to vest at March 31, 2023 700,000 $ 1.44 8.7 $ — The weighted average grant date fair value of the performance stock options awarded during the six months ended March 31, 2023 and 2022, was $0.91 and $1.03 per option, respectively. As of March 31, 2023, the Company assessed that the performance conditions related to the performance options granted were not probable of achievement. The assessment was based on the relevant facts and circumstances and therefore no compensation costs were recognized. The fair value of the options was estimated on the date of grant using a Black-Scholes option pricing model with the following weighted-average assumptions: Six months ended March 31, 2023 2022 Risk-free interest rate 3.8 % 1.3 % Expected term (years) 10.0 5.2 Expected volatility 91.3 % 91.5 % Expected dividend yield — — Performance-based stock units The Company has issued PSUs, which generally have a ten-year term from the date of grant. Upon exercise, the PSU holder receives common stock or cash at the Company’s discretion. The following table summarizes the activity related to PSUs during the six months ended March 31, 2023: Weighted Average Number Base Remaining of Price Contractual Aggregate PSUs Per PSU Term (Years) Intrinsic Value Balance at October 1, 2022 2,470 $ 49.97 Forfeitures — — Balance at March 31, 2023 2,470 $ 49.97 1.8 $ — Vested and exercisable at March 31, 2023 2,470 $ 49.97 1.8 $ — Restricted stock In connection with the consulting agreements entered into by the Company and four former principals of MTTR LLC (“MTTR”), in March 2020, the Company issued an aggregate of 7,244,739 shares of its common stock. Refer to Note 11 for further details on the consulting agreements and terminated strategic partnership agreement. These shares may not be sold until the earlier of (i) six months following FDA approval of ONS-5010, (ii) the date the Company publicly announces not to pursue development of ONS-5010, (iii) a change in control or (iv) January 2025. In addition, the Company has the right to repurchase the shares for $0.01 per share if the consultant terminates his agreement other than for good reason or the Company terminates the agreement for cause. The repurchase right lapses, in tiered percentages, based upon the completion of enrollment of the Company’s NORSE TWO clinical trial of ONS-5010 by certain dates. The repurchase right may also lapse as to 50% or 100% of the shares if the Company enters into certain agreements pertaining to ONS-5010 that meet certain value thresholds or the Company’s share price meets certain predefined targets. The repurchase right also lapses as to 100% of the shares upon the earliest to occur of (i) filing of the BLA for ONS-5010, (ii) termination of the agreement by the consultant for good reason or by the Company other than for cause, (iii) in the event of disability, or (iv) upon a change in control. The grant date fair value of the restricted shares was $0.54 per share and equal to the closing stock price of the Company’s common stock at the time of grant. Compensation expense is recognized over the shorter of the explicit service period or derived service period, which was determined to be 4.8 years at the time of grant. The compensation expense was accelerated during the year ended September 30, 2022 as a result of the Company achieving certain performance conditions related to the Company’s BLA submission and the corresponding repurchase rights lapsing. During the three months ended March 31, 2022, the Company recognized compensation expense related to the restricted stock of $1,852,182. During the six months ended March 31, 2022, the Company recognized compensation expense related to the restricted stock of $2,003,946. There was no expense recognized for the three and six months ended March 31, 2023 and as of March 31, 2023, there was no unrecognized compensation expense related to the restricted stock. |
Related-Party Transactions
Related-Party Transactions | 6 Months Ended |
Mar. 31, 2023 | |
Related-Party Transactions | |
Related-Party Transactions | 11. Related-Party Transactions MTTR - strategic partnership agreement (ONS-5010) In February 2018, the Company entered into a strategic partnership agreement with MTTR to advise on regulatory, clinical and commercial strategy and assist in obtaining approval of ONS-5010. In November 2018, the board of directors of the Company appointed Mr. Terry Dagnon as Chief Operations Officer and Mr. Jeff Evanson as Chief Commercial Officer. Both Mr. Dagnon and Mr. Evanson initially provided services to the Company pursuant to the February 2018 strategic partnership agreement with MTTR, as amended. Mr. Dagnon and Mr. Evanson were both principals in MTTR. Both Mr. Dagnon and Mr. Evanson were compensated directly by MTTR for services provided to the Company as the Company's Chief Operations Officer and Chief Commercial Officer, respectively, pursuant to the strategic partnership agreement until such agreement, as amended, was terminated effective March 19, 2020. The Company began compensating Mr. Dagnon and Mr. Evanson directly as consultants effective March 19, 2020 pursuant to their respective consulting agreements with the Company, which became effective March 19, 2020 following stockholder approval of the share issuances contemplated therein. On January 27, 2020, the Company entered into a termination agreement and mutual release with MTTR to terminate the strategic partnership agreement. Pursuant to the agreement, the Company agreed (x) to issue to the four principals of MTTR (who include two of its named executive officers, Messrs. Dagnon and Evanson) an aggregate of 7,244,739 shares of its common stock, subject to stockholder approval, (y) to enter into consulting agreements with each of the four principals setting forth the terms of his respective compensation arrangement, and (z) to pay MTTR a one-time settlement fee of $110,000 upon effectiveness of the agreement. Concurrently, the Company also entered into consulting agreements directly with each of the four principals of MTTR setting forth the terms of his respective compensation arrangement, as well as providing for certain transfer restrictions and repurchase rights applicable to the shares of common stock to be issued pursuant hereto. The termination agreement and the consulting agreements became effective upon stockholder approval of the share issuance on March 19, 2020. Refer to Note 10 for the accounting of the restricted stock issued and compensation expense recognized. During the three months ended March 31, 2023 and 2022, MTTR and its four principals under the strategic partnership agreement and the subsequent individual consulting agreements earned an aggregate of $28,886 and $99,380 , respectively, and $65,552 and $413,366 during the six months ended March 31, 2023 and 2022, respectively, which includes monthly consulting fees and expense reimbursement, but excludes stock-based compensation related to restricted stock (Note 10). As of September 30, 2022, an aggregate of $18,333 , was due to the former MTTR principals as consultants, which is included in accounts payable in the accompanying consolidated balance sheets. As of March 31, 2023, there was no outstanding amount due to the former MTTR principals as consultants. On December 21, 2021, the Company entered into employment agreements with each of Mr. Dagnon and Mr. Evanson, which superseded and replaced their prior consulting agreements. Pursuant to their new employment agreements, each of Mr. Dagnon and Mr. Evanson will receive a base salary of $450,000 and a discretionary annual cash bonus with a target amount equal to 50% of his respective base salary. In connection with their entry into the employment agreements, each of Mr. Dagnon and Mr. Evanson received a grant of 800,000 options to purchase common stock, one quarter of which will vest on the first anniversary of the grant and the remainder of which will vest in monthly installments over the succeeding three years, subject to their continued service through each vesting date. In addition, each of Mr. Dagnon and Mr. Evanson received a performance grant of 200,000 options to purchase common stock, which will vest upon the Company’s achievement of certain milestones. An aggregate of 200,000 performance-based stock options vested as a result of achieving the performance condition related to the Company’s BLA submission. |
Basis of Presentation and Sum_2
Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Mar. 31, 2023 | |
Basis of Presentation and Summary of Significant Accounting Policies | |
Basis of presentation | Basis of presentation The accompanying unaudited interim consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Any reference in these notes to applicable guidance is meant to refer to GAAP as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Updates (“ASU”) of the Financial Accounting Standards Board (“FASB”). In the opinion of management, the accompanying unaudited interim consolidated financial statements include all normal and recurring adjustments (which consist primarily of accruals, estimates and assumptions that impact the financial statements) considered necessary to present fairly the Company’s financial position as of March 31, 2023 and its results of operations for the three and six months ended March 31, 2023 and 2022, cash flows for the six months ended March 31, 2023 and 2022, and stockholders’ equity for the three and six months ended March 31, 2023 and 2022. Operating results for the six months ended March 31, 2023 are not necessarily indicative of the results that may be expected for the full year ending September 30, 2023. The unaudited interim consolidated financial statements presented herein do not contain all of the required disclosures under GAAP for annual consolidated financial statements. The accompanying unaudited interim consolidated financial statements should be read in conjunction with the annual audited consolidated financial statements and related notes as of and for the year ended September 30, 2022 included in the Company’s Annual Report on Form 10-K filed with the SEC on December 29, 2022. |
Use of estimates | Use of estimates The preparation of the unaudited interim consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Due to the uncertainty of factors surrounding the estimates or judgments used in the preparation of the unaudited interim consolidated financial statements, such as the current macroeconomic environment, including as a result of the ongoing COVID-19 pandemic or political disruption such as the war between Ukraine and Russia, actual results may materially vary from these estimates. Estimates and assumptions are periodically reviewed, and the effects of revisions are reflected in the unaudited interim consolidated financial statements in the period they are determined to be necessary. |
Net loss per share | Net loss per share Basic and diluted net loss per common share is determined by dividing net loss attributable to common stockholders by the weighted-average number of shares of common stock outstanding during the period. For purposes of calculating diluted loss per common share, the denominator includes both the weighted average common shares outstanding and the number of common stock equivalents if the inclusion of such common stock equivalents would be dilutive. Potentially dilutive securities include warrants, performance-based stock options and units, stock options and non-vested restricted stock unit (“RSU”) awards using the treasury stock method. For all periods presented, there is no difference in the number of shares used to compute basic and diluted shares due to the Company’s loss. The following table sets forth the computation of basic loss per share and diluted loss per share: Three months ended March 31, Six months ended March 31, 2023 2022 2023 2022 Net loss attributable to common stockholders $ (6,654,286) $ (19,704,549) $ (25,316,799) $ (34,167,278) Common stock shares outstanding (weighted average) 256,666,794 219,067,900 241,877,917 203,443,077 Basic and diluted net loss per share $ (0.03) $ (0.09) $ (0.10) $ (0.17) The following potentially dilutive securities (in common stock equivalents) have been excluded from the computation of diluted weighted-average shares outstanding as of March 31, 2023 and 2022, as they would be antidilutive: As of March 31, 2023 2022 Performance-based stock units 2,470 2,470 Performance-based stock options 1,900,000 1,900,000 Stock options 22,064,850 19,783,581 Common stock warrants 7,328,549 6,812,794 Convertible debt 16,305,235 (i) — (i) The potentially dilutive securities related to convertible debt are calculated based on a fixed conversion price of $2.00 per share, which is subject to change as described in Note 7. |
Recently issued accounting pronouncements | Recently issued accounting pronouncements In August 2020, the FASB issued ASU 2020-06, Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815 - 40) There have been no other accounting pronouncements issued but not yet adopted by the Company which are expected to have a material impact on the Company’s consolidated financial position, results of operations or cash flows. |
Basis of Presentation and Sum_3
Basis of Presentation and Summary of Significant Accounting Policies (Tables) | 6 Months Ended |
Mar. 31, 2023 | |
Basis of Presentation and Summary of Significant Accounting Policies | |
Schedule of computation of basic earnings per share and diluted earnings per share | Three months ended March 31, Six months ended March 31, 2023 2022 2023 2022 Net loss attributable to common stockholders $ (6,654,286) $ (19,704,549) $ (25,316,799) $ (34,167,278) Common stock shares outstanding (weighted average) 256,666,794 219,067,900 241,877,917 203,443,077 Basic and diluted net loss per share $ (0.03) $ (0.09) $ (0.10) $ (0.17) |
Schedule of dilutive securities excluded from the computation weighted-average shares | As of March 31, 2023 2022 Performance-based stock units 2,470 2,470 Performance-based stock options 1,900,000 1,900,000 Stock options 22,064,850 19,783,581 Common stock warrants 7,328,549 6,812,794 Convertible debt 16,305,235 (i) — (i) The potentially dilutive securities related to convertible debt are calculated based on a fixed conversion price of $2.00 per share, which is subject to change as described in Note 7. |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Mar. 31, 2023 | |
Fair value inputs | |
Schedule of assets and liabilities measured at fair value on a recurring basis | March 31, 2023 (Level 1) (Level 2) (Level 3) Liabilities Unsecured convertible promissory note $ — $ — $ 31,823,000 Warrant liability — — 8,263 Total $ — $ — $ 31,831,263 September 30, 2022 (Level 1) (Level 2) (Level 3) Liabilities Unsecured convertible promissory note $ — $ — $ — Warrant liability — — 57,138 Total $ — $ — $ 57,138 |
Schedule of changes in the fair value of Level 3 liabilities | Unsecured Convertible Promissory Note Warrants Balance at October 1, 2022 $ — $ 57,138 Fair value at issuance date 31,820,000 — Change in fair value 3,000 (48,875) Balance at March 31, 2023 $ 31,823,000 $ 8,263 |
Unsecured promissory note December 2022 | |
Fair value inputs | |
Schedule of fair value inputs | March 31, 2023 Term (years) 0.8 Stock price $ 1.09 Volatility 57.0 % Risk-free rate 4.8 % Dividend yield — % Credit-adjusted discount rate 23.3 % |
Common stock warrants | |
Fair value inputs | |
Schedule of fair value inputs | March 31, 2023 September 30, 2022 Risk-free interest rate 4.14 % 4.23 % Remaining contractual term of warrants (years) 1.9 2.4 Expected volatility 76.1 % 92.5 % Annual dividend yield — % — % Fair value of common stock (per share) $ 1.09 $ 1.22 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 6 Months Ended |
Mar. 31, 2023 | |
Accrued Expenses | |
Schedule of accrued expenses | March 31, 2023 September 30, 2022 Compensation $ 1,661,984 $ 1,976,252 Research and development 3,836,228 744,154 Professional fees 559,181 564,423 Other accrued expenses 157,004 143,071 $ 6,214,397 $ 3,427,900 |
Debt (Tables)
Debt (Tables) | 6 Months Ended |
Mar. 31, 2023 | |
Debt | |
Schedule of debt | March 31, 2023 September 30, 2022 Unsecured convertible promissory note (measured at fair value) $ 31,823,000 $ — Unsecured promissory note — 11,114,518 Total debt 31,823,000 11,114,518 Less: unamortized loan costs — (199,503) Total debt, net of unamortized loan costs 31,823,000 10,915,015 Less: current portion (31,823,000) (10,915,015) Long-term debt $ — $ — |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 6 Months Ended |
Mar. 31, 2023 | |
Commitments and Contingencies | |
Schedule of lease information | The components of lease cost for the three and six months ended March 31, 2023 and 2022 are as follows: Three months ended March 31, Six months ended March 31, 2023 2022 2023 2022 Lease cost: Amortization of right-of-use assets $ — $ — $ — $ — Interest on lease liabilities 398 849 889 1,823 Total finance lease cost 398 849 889 1,823 Operating lease cost 11,216 11,217 22,433 22,433 Total lease cost $ 11,614 $ 12,066 $ 23,322 $ 24,256 Amounts reported in the unaudited interim consolidated balance sheets for leases where the Company is the lessee are as follows: March 31, 2023 September 30, 2022 Operating leases: Right-of-use asset $ 48,581 $ 70,360 Operating lease liabilities 3,929 26,995 Finance leases: Right-of-use asset $ — $ — Financing lease liabilities 10,332 16,018 Weighted-average remaining lease term (years): Operating leases 1.1 1.6 Finance leases 0.8 1.3 Weighted-average discount rate: Operating leases 7.5% 7.5% Finance leases 13.0% 13.0% Other information related to leases for the six months ended March 31, 2023 and 2022 are as follows: Six months ended March 31, 2023 2022 Cash paid for amounts included in the measurement of lease obligations: Operating cash flows from finance leases $ 889 $ 1,823 Operating cash flows from operating leases 23,721 23,043 |
Schedule of operating lease future minimum payments | Future minimum lease payments under non-cancelable leases as of March 31, 2023 are as follows for the years ending September 30: Operating leases Finance leases 2023 (remaining six months) $ 3,954 $ 6,575 2024 — 4,383 Total undiscounted lease payments 3,954 10,958 Less: Imputed interest 25 626 Total lease obligations $ 3,929 $ 10,332 |
Schedule of finance lease future minimum payments | Operating leases Finance leases 2023 (remaining six months) $ 3,954 $ 6,575 2024 — 4,383 Total undiscounted lease payments 3,954 10,958 Less: Imputed interest 25 626 Total lease obligations $ 3,929 $ 10,332 |
Common Stock and Stockholders_2
Common Stock and Stockholders' Equity (Tables) | 6 Months Ended |
Mar. 31, 2023 | |
Common Stock and Stockholders' Equity | |
Schedule of warrants outstanding | As of March 31, 2023, shares of common stock issuable upon the exercise of outstanding warrants were as follows: Shares of common stock issuable upon exercise of Exercise Price Expiration Date warrants Per Share December 22, 2024 (i) 277,128 $ 12.00 February 26, 2024 1,747,047 $ 0.9535 February 24, 2025 172,864 $ 1.27 April 13, 2025 (i) 145,686 $ 12.00 May 31, 2025 (i) 62,437 $ 12.00 June 22, 2025 191,268 $ 1.51875 December 28, 2025 515,755 $ 1.0500 January 28, 2026 2,116,364 $ 1.25 November 23, 2026 2,100,000 $ 1.5625 7,328,549 (i) The warrants were issued in connection with the convertible senior secured notes originally issued pursuant to the certain Note and Warrant Purchase Agreement dated December 22, 2017 and are classified as liabilities on the accompanying unaudited interim consolidated balance sheets, as the warrants include cash settlement features at the option of the holders under certain circumstances. Refer to Note 4 for fair value measurements disclosures. |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 6 Months Ended |
Mar. 31, 2023 | |
Share-based Compensation | |
Schedule of stock-based compensation expense | Three months ended March 31, Six months ended March 31, 2023 2022 2023 2022 Research and development $ 322,268 $ 1,820,262 $ 612,924 $ 2,072,657 General and administrative 1,061,137 1,942,533 2,162,874 2,894,186 $ 1,383,405 $ 3,762,795 $ 2,775,798 $ 4,966,843 |
Schedule of performance-based stock units activity | Weighted Average Number Base Remaining of Price Contractual Aggregate PSUs Per PSU Term (Years) Intrinsic Value Balance at October 1, 2022 2,470 $ 49.97 Forfeitures — — Balance at March 31, 2023 2,470 $ 49.97 1.8 $ — Vested and exercisable at March 31, 2023 2,470 $ 49.97 1.8 $ — |
Stock options | |
Share-based Compensation | |
Schedule of stock option activity | Weighted Average Weighted Remaining Number of Average Contractual Aggregate Shares Exercise Price Term (Years) Intrinsic Value Balance at October 1, 2022 20,124,581 $ 1.49 Granted 1,940,269 1.15 Balance at March 31, 2023 22,064,850 $ 1.46 8.0 $ 3,412,868 Vested and exercisable at March 31, 2023 11,901,123 $ 1.48 7.6 $ 2,169,900 Vested and expected to vest at March 31, 2023 22,064,850 $ 1.46 8.0 $ 3,412,868 |
Schedule of option assumptions | Six months ended March 31, 2023 2022 Risk-free interest rate 3.7 % 1.6 % Expected term (years) 5.7 6.0 Expected volatility 112.4 % 95.7 % Expected dividend yield — — |
Performance-based stock options | |
Share-based Compensation | |
Schedule of stock option activity | Weighted Average Weighted Remaining Number of Average Contractual Aggregate Shares Exercise Price Term (Years) Intrinsic Value Balance at October 1, 2022 700,000 $ 1.44 Granted 1,200,000 1.04 Balance at March 31, 2023 1,900,000 $ 1.19 9.3 $ 60,000 Vested and exercisable at March 31, 2023 700,000 $ 1.44 8.7 $ — Vested and expected to vest at March 31, 2023 700,000 $ 1.44 8.7 $ — |
Schedule of option assumptions | Six months ended March 31, 2023 2022 Risk-free interest rate 3.8 % 1.3 % Expected term (years) 10.0 5.2 Expected volatility 91.3 % 91.5 % Expected dividend yield — — |
Liquidity (Details)
Liquidity (Details) - USD ($) | Mar. 31, 2023 | Sep. 30, 2022 |
Liquidity | ||
Accumulated deficit | $ 434,252,317 | $ 408,935,518 |
Long-term debt including interest | $ 35,056,257 |
Basis of Presentation and Sum_4
Basis of Presentation and Summary of Significant Accounting Policies (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Mar. 31, 2023 | Mar. 31, 2022 | |
Basic and diluted earnings per share: | ||||
Net loss attributable to common stockholders | $ (6,654,286) | $ (19,704,549) | $ (25,316,799) | $ (34,167,278) |
Basic Earnings Per Share | ||||
Common stock shares outstanding (weighted average), basic (in shares) | 256,666,794 | 219,067,900 | 241,877,917 | 203,443,077 |
Basic net loss per share (in dollars per share) | $ (0.03) | $ (0.09) | $ (0.10) | $ (0.17) |
Diluted Earnings Per Share | ||||
Common stock shares outstanding (weighted average), diluted (in shares) | 256,666,794 | 219,067,900 | 241,877,917 | 203,443,077 |
Diluted net loss per share (in dollars per share) | $ (0.03) | $ (0.09) | $ (0.10) | $ (0.17) |
Basis of Presentation and Sum_5
Basis of Presentation and Summary of Significant Accounting Policies - Dilutive (Details) - $ / shares | 6 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Performance-based stock units | ||
Antidilutive securities | ||
Antidilutive securities excluded from computation of earnings per share | 2,470 | 2,470 |
Performance-based stock options | ||
Antidilutive securities | ||
Antidilutive securities excluded from computation of earnings per share | 1,900,000 | 1,900,000 |
Stock options | ||
Antidilutive securities | ||
Antidilutive securities excluded from computation of earnings per share | 22,064,850 | 19,783,581 |
Common stock warrants | ||
Antidilutive securities | ||
Antidilutive securities excluded from computation of earnings per share | 7,328,549 | 6,812,794 |
Convertible debt | ||
Antidilutive securities | ||
Antidilutive securities excluded from computation of earnings per share | 16,305,235 | |
Conversion rate per share | $ 2 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) | Mar. 31, 2023 | Sep. 30, 2022 |
Liabilities | ||
Derivative Liability, Statement of Financial Position [Extensible Enumeration] | Warrants and Rights Outstanding | Warrants and Rights Outstanding |
Fair value measurements recurring basis | Level 3 | ||
Liabilities | ||
Unsecured convertible promissory note | $ 31,823,000 | |
Warrant liability | 8,263 | $ 57,138 |
Fair value of liabilities | $ 31,831,263 | $ 57,138 |
Fair Value Measurements - Chang
Fair Value Measurements - Changes in fair value (Details) | 6 Months Ended |
Mar. 31, 2023 USD ($) | |
Unsecured promissory note December 2022 | |
Liabilities fair value changes | |
Fair value at issuance date | $ 31,820,000 |
Change in fair value | $ 3,000 |
Fair Value, Liability, Recurring Basis, Unobservable Input Reconciliation, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Change In Fair Value Of Redemption Feature |
Balance, ending | $ 31,823,000 |
Warrant liability | |
Liabilities fair value changes | |
Balance, beginning | 57,138 |
Change in fair value | $ (48,875) |
Fair Value, Liability, Recurring Basis, Unobservable Input Reconciliation, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Fair Value Adjustment of Warrants |
Balance, ending | $ 8,263 |
Fair Value Measurements - Assum
Fair Value Measurements - Assumptions (Details) | Mar. 31, 2023 USD ($) Y $ / shares | Sep. 30, 2022 Y $ / shares |
Risk-free interest rate | ||
Fair value inputs | ||
Debt inputs | 0.048 | |
Warrant inputs | 0.0414 | 0.0423 |
Expected term | ||
Fair value inputs | ||
Debt inputs | Y | 0.8 | |
Warrant inputs | Y | 1.9 | 2.4 |
Expected volatility | ||
Fair value inputs | ||
Debt inputs | 0.570 | |
Warrant inputs | 0.761 | 0.925 |
Annual dividend yield | ||
Fair value inputs | ||
Debt inputs | 0 | |
Warrant inputs | 0 | 0 |
Stock price (per share) | ||
Fair value inputs | ||
Debt inputs | $ / shares | 1.09 | |
Warrant inputs | $ / shares | 1.09 | 1.22 |
Discount rate | ||
Fair value inputs | ||
Debt inputs | 0.233 |
Equity Method Investment - Synt
Equity Method Investment - Syntone (Details) - Syntone - USD ($) | 1 Months Ended | |
May 22, 2020 | Jun. 30, 2020 | |
Investments | ||
Ownership percentage | 20% | |
Investment in joint venture | $ 900,000 | |
Expected future investment | $ 2,100,000 | |
Contract period | 4 years | |
Syntone PRC | ||
Investments | ||
Ownership percentage | 80% |
Accrued Expenses (Details)
Accrued Expenses (Details) - USD ($) | Mar. 31, 2023 | Sep. 30, 2022 |
Accrued Expenses | ||
Compensation | $ 1,661,984 | $ 1,976,252 |
Research and development | 3,836,228 | 744,154 |
Professional fees | 559,181 | 564,423 |
Other accrued expenses | 157,004 | 143,071 |
Accrued expenses, total | $ 6,214,397 | $ 3,427,900 |
Debt - Summary (Details)
Debt - Summary (Details) - USD ($) | Mar. 31, 2023 | Sep. 30, 2022 | Nov. 16, 2021 |
Debt Instrument [Line Items] | |||
Total debt | $ 31,823,000 | $ 11,114,518 | |
Less: unamortized loan costs | (199,503) | ||
Total debt, net of unamortized loan costs | 31,823,000 | 10,915,015 | |
Less: current portion | (31,823,000) | (10,915,015) | |
Unsecured promissory note December 2022 | |||
Debt Instrument [Line Items] | |||
Total debt | $ 31,823,000 | ||
Unsecured promissory note November 2021 | |||
Debt Instrument [Line Items] | |||
Total debt | $ 11,114,518 | ||
Less: unamortized loan costs | $ (820,000) |
Debt - Information (Details)
Debt - Information (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||||
Dec. 22, 2022 | Nov. 16, 2021 | Mar. 31, 2022 | Mar. 31, 2023 | Mar. 31, 2022 | Sep. 30, 2022 | |
Debt | ||||||
Proceeds from loan | $ 30,000,000 | $ 10,000,000 | ||||
Unamortized discount | $ 199,503 | |||||
Interest paid | 1,158,609 | |||||
Gain (loss) on extinguishment of debt | (577,659) | (1,025,402) | ||||
Unsecured promissory note December 2022 | ||||||
Debt | ||||||
Original principal amount | $ 31,820,000 | |||||
Proceeds from loan | $ 18,052,461 | |||||
Interest rate (as a percent) | 9.50% | |||||
Conversion rate per share | $ 2.50 | |||||
Trading day threshold | 30 | |||||
Interest expense | $ 2,074,964 | |||||
Debt issuance costs | 1,820,000 | |||||
Third party debt issuance costs | $ 254,964 | |||||
Unsecured promissory note November 2021 | ||||||
Debt | ||||||
Original principal amount | $ 10,220,000 | |||||
Proceeds from loan | $ 10,000,000 | |||||
Interest rate (as a percent) | 9.50% | |||||
Interest expense | $ 418,388 | 454,866 | 763,104 | |||
Unamortized discount | $ 820,000 | |||||
Redemption price (as a percent) | 105% | 105% | ||||
Repayments of unsecured debt | $ 11,947,539 | |||||
Amortization of debt issuance costs | 8,729 | $ 169,857 | $ 190,775 | $ 277,980 | ||
Interest paid | 1,158,609 | |||||
Gain (loss) on extinguishment of debt | (577,659) | |||||
Prepayment fee | $ 568,930 |
Commitments and Contingencies -
Commitments and Contingencies - Lease cost (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Mar. 31, 2023 | Mar. 31, 2022 | Mar. 31, 2023 | Mar. 31, 2022 | Mar. 31, 2021 | |
Leases | |||||
Finance lease term | 3 years | ||||
Lease cost | |||||
Interest on lease liabilities | $ 398 | $ 849 | $ 889 | $ 1,823 | |
Total finance lease cost | 398 | 849 | 889 | 1,823 | |
Operating lease cost | 11,216 | 11,217 | 22,433 | 22,433 | |
Total lease cost | $ 11,614 | $ 12,066 | $ 23,322 | $ 24,256 | |
Minimum | |||||
Leases | |||||
Finance lease term | 12 months | 12 months | |||
Finance lease interest (as a percent) | 4% | 4% | |||
Maximum | |||||
Leases | |||||
Finance lease term | 36 months | 36 months | |||
Finance lease interest (as a percent) | 13% | 13% |
Commitments and Contingencies_2
Commitments and Contingencies - Lease balance sheet (Details) - USD ($) | Mar. 31, 2023 | Sep. 30, 2022 |
Leases | ||
Operating leases, Right-of-use asset | $ 48,581 | $ 70,360 |
Operating lease liabilities | 3,929 | 26,995 |
Financing lease liabilities | $ 10,332 | $ 16,018 |
Operating leases, Weighted-average remaining lease term | 1 year 1 month 6 days | 1 year 7 months 6 days |
Finance leases, Weighted-average remaining lease term | 9 months 18 days | 1 year 3 months 18 days |
Operating leases, Weighted-average discount rate (as a percent) | 7.50% | 7.50% |
Finance leases, Weighted-average discount rate (as a percent) | 13% | 13% |
Commitments and Contingencies_3
Commitments and Contingencies - Lease cash flow (Details) - USD ($) | 6 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Leases | ||
Operating cash flows from finance leases | $ 889 | $ 1,823 |
Operating cash flows from operating leases | $ 23,721 | $ 23,043 |
Commitments and Contingencies_4
Commitments and Contingencies - Lease minimum payments (Details) - USD ($) | Mar. 31, 2023 | Sep. 30, 2022 |
Operating leases | ||
2023 (remaining six months) | $ 3,954 | |
Total undiscounted lease payments | 3,954 | |
Less: Imputed interest | 25 | |
Total lease obligations | 3,929 | $ 26,995 |
Finance leases | ||
2023 (remaining six months) | 6,575 | |
2024 | 4,383 | |
Total undiscounted lease payments | 10,958 | |
Less: Imputed interest | 626 | |
Total lease obligations | $ 10,332 | $ 16,018 |
Common Stock and Stockholders_3
Common Stock and Stockholders' Equity - Common Stock (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||||||
Mar. 26, 2021 | Dec. 31, 2022 | Nov. 30, 2021 | Mar. 31, 2023 | Mar. 31, 2023 | Mar. 31, 2022 | Mar. 29, 2023 | Mar. 28, 2023 | Sep. 30, 2022 | |
Stockholders' Equity | |||||||||
Common stock, shares authorized | 425,000,000 | 425,000,000 | 425,000,000 | 325,000,000 | 425,000,000 | ||||
Shares of common stock issuable upon exercise of warrants | 7,328,549 | 7,328,549 | |||||||
Proceeds from issuance of stock | $ 24,297,734 | $ 60,382,548 | |||||||
Underwritten Public Offering | |||||||||
Stockholders' Equity | |||||||||
Number of share issued | 46,000,000 | ||||||||
Shares of common stock issuable upon exercise of warrants | 2,100,000 | ||||||||
Shares issued price (in dollars per share) | $ 1.25 | ||||||||
Proceeds from issuance of stock | $ 53,968,057 | ||||||||
Exercise price per share | $ 1.5625 | ||||||||
Warrants exercise term | 5 years | ||||||||
Underwritten Public Offering | GMS Ventures & Investments | |||||||||
Stockholders' Equity | |||||||||
Number of share issued | 16,000,000 | ||||||||
Direct registered offering | |||||||||
Stockholders' Equity | |||||||||
Number of share issued | 28,460,831 | ||||||||
Shares issued price (in dollars per share) | $ 0.8784 | ||||||||
Proceeds from issuance of stock | $ 23,547,904 | ||||||||
Direct registered offering | GMS Ventures & Investments | |||||||||
Stockholders' Equity | |||||||||
Number of share issued | 14,230,418 | ||||||||
Direct registered offering | M.S. Howells & Co | |||||||||
Stockholders' Equity | |||||||||
Shares of common stock issuable upon exercise of warrants | 515,755 | ||||||||
Exercise price per share | $ 1.05 | ||||||||
Warrants exercise term | 3 years | ||||||||
ATM Offering | |||||||||
Stockholders' Equity | |||||||||
Number of share issued | 0 | 895,391 | 3,290,439 | ||||||
Proceeds from issuance of stock | $ 1,127,904 | $ 6,626,696 | |||||||
Aggregate offering price | $ 40,000,000 | ||||||||
Amount reclassified on additional paid in capital | $ 197,654 | ||||||||
Deferred costs | $ 113,850 | 113,850 | |||||||
Percentage of commission on sale of common stock | 3% | ||||||||
Payment of fees to sales agent | $ 38,799 | $ 212,206 |
Common Stock and Stockholders_4
Common Stock and Stockholders' Equity - Warrants (Details) - USD ($) | 6 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Warrants | ||
Shares of common stock issuable upon exercise of warrants | 7,328,549 | |
Proceeds from issuance of stock | $ 24,297,734 | $ 60,382,548 |
December 22, 2024 | ||
Warrants | ||
Shares of common stock issuable upon exercise of warrants | 277,128 | |
Exercise price per share | $ 12 | |
February 26, 2024 | ||
Warrants | ||
Shares of common stock issuable upon exercise of warrants | 1,747,047 | |
Exercise price per share | $ 0.9535 | |
February 24, 2025 | ||
Warrants | ||
Shares of common stock issuable upon exercise of warrants | 172,864 | |
Exercise price per share | $ 1.27 | |
April 13, 2025 | ||
Warrants | ||
Shares of common stock issuable upon exercise of warrants | 145,686 | |
Exercise price per share | $ 12 | |
May 31, 2025 | ||
Warrants | ||
Shares of common stock issuable upon exercise of warrants | 62,437 | |
Exercise price per share | $ 12 | |
June 22, 2025 | ||
Warrants | ||
Shares of common stock issuable upon exercise of warrants | 191,268 | |
Exercise price per share | $ 1.51875 | |
December 28, 2025 | ||
Warrants | ||
Shares of common stock issuable upon exercise of warrants | 515,755 | |
Exercise price per share | $ 1.0500 | |
January 28, 2026 | ||
Warrants | ||
Shares of common stock issuable upon exercise of warrants | 2,116,364 | |
Exercise price per share | $ 1.25 | |
November 23, 2026 | ||
Warrants | ||
Shares of common stock issuable upon exercise of warrants | 2,100,000 | |
Exercise price per share | $ 1.5625 |
Stock-Based Compensation - Info
Stock-Based Compensation - Information (Details) | 6 Months Ended |
Mar. 31, 2023 shares | |
Performance-based stock units | |
Share-based Compensation | |
Term of award | 10 years |
2011 Equity Incentive Plan | Performance-based stock units | |
Share-based Compensation | |
Awards outstanding | 2,470 |
2015 Equity Incentive Plan | |
Share-based Compensation | |
Aggregate number of common stock authorized for issuance | 42,265,841 |
Number of shares available for grant | 18,106,339 |
Term of award | 10 years |
2015 Equity Incentive Plan | Minimum | |
Share-based Compensation | |
Vesting period | 1 year |
2015 Equity Incentive Plan | Maximum | |
Share-based Compensation | |
Vesting period | 4 years |
Stock-Based Compensation - Expe
Stock-Based Compensation - Expense (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Mar. 31, 2023 | Mar. 31, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation expense | $ 1,383,405 | $ 3,762,795 | $ 2,775,798 | $ 4,966,843 |
Research and development | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation expense | 322,268 | 1,820,262 | 612,924 | 2,072,657 |
General and administrative | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation expense | $ 1,061,137 | $ 1,942,533 | $ 2,162,874 | $ 2,894,186 |
Stock-Based Compensation - Stoc
Stock-Based Compensation - Stock option activity (Details) - USD ($) | 6 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Stock options | ||
Number of Shares | ||
Balance, Beginning (in shares) | 20,124,581 | |
Granted (in shares) | 1,940,269 | |
Balance, Ending (in shares) | 22,064,850 | |
Vested and exercisable (in shares) | 11,901,123 | |
Vested and expected to vest (in shares) | 22,064,850 | |
Weighted Average Exercise Price | ||
Balance, Beginning (in dollars per share) | $ 1.49 | |
Granted (in dollars per share) | 1.15 | |
Balance, Ending (in dollars per share) | 1.46 | |
Vested and exercisable (in dollars per share) | 1.48 | |
Vested and expected to vest (in dollars per share) | $ 1.46 | |
Other option information | ||
Balance-Remaining contractual term | 8 years | |
Vested and exercisable -Remaining contractual term | 7 years 7 months 6 days | |
Vested and expected to vest-Remaining contractual term | 8 years | |
Aggregate intrinsic value, Outstanding | $ 3,412,868 | |
Aggregate intrinsic value, Vested and exercisable | 2,169,900 | |
Aggregate intrinsic value, Vested and expected to vest | $ 3,412,868 | |
Grant date fair value of options (in dollars per share) | $ 0.96 | $ 1.25 |
Performance-based stock options | ||
Number of Shares | ||
Balance, Beginning (in shares) | 700,000 | |
Granted (in shares) | 1,200,000 | |
Balance, Ending (in shares) | 1,900,000 | |
Vested and exercisable (in shares) | 700,000 | |
Vested and expected to vest (in shares) | 700,000 | |
Weighted Average Exercise Price | ||
Balance, Beginning (in dollars per share) | $ 1.44 | |
Granted (in dollars per share) | 1.04 | |
Balance, Ending (in dollars per share) | 1.19 | |
Vested and exercisable (in dollars per share) | 1.44 | |
Vested and expected to vest (in dollars per share) | $ 1.44 | |
Other option information | ||
Balance-Remaining contractual term | 9 years 3 months 18 days | |
Vested and exercisable -Remaining contractual term | 8 years 8 months 12 days | |
Vested and expected to vest-Remaining contractual term | 8 years 8 months 12 days | |
Aggregate intrinsic value, Outstanding | $ 60,000 | |
Term of award | 10 years | |
Grant date fair value of options (in dollars per share) | $ 0.91 | $ 1.03 |
Stock-Based Compensation - Opti
Stock-Based Compensation - Option Assumptions (Details) - USD ($) | 6 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Stock options | ||
Share-based Compensation | ||
Risk-free interest rate | 3.70% | 1.60% |
Expected term (years) | 5 years 8 months 12 days | 6 years |
Expected volatility | 112.40% | 95.70% |
Expected dividend yield | 0% | 0% |
Unrecognized compensation expense | $ 10,112,008 | |
Unrecognized compensation exercise period | 2 years 4 months 24 days | |
Performance-based stock options | ||
Share-based Compensation | ||
Risk-free interest rate | 3.80% | 1.30% |
Expected term (years) | 10 years | 5 years 2 months 12 days |
Expected volatility | 91.30% | 91.50% |
Expected dividend yield | 0% | 0% |
Stock-Based Compensation - Non-
Stock-Based Compensation - Non-options (Details) - Performance-based stock units | 6 Months Ended |
Mar. 31, 2023 $ / shares shares | |
Share-based Compensation | |
Term of award | 10 years |
Number of PSUs | |
Balance, Beginning | shares | 2,470 |
Forfeitures | shares | |
Balance, Ending | shares | 2,470 |
Vested and exercisable | shares | 2,470 |
Weighted Average Base Price Per Unit | |
Balance, Beginning | $ / shares | $ 49.97 |
Forfeitures | $ / shares | |
Balance, Ending | $ / shares | 49.97 |
Vested and exercisable | $ / shares | $ 49.97 |
Weighted average remaining contractual term, Outstanding | 1 year 9 months 18 days |
Weighted average remaining contractual term, Vested and exercisable | 1 year 9 months 18 days |
Stock-Based Compensation - Rest
Stock-Based Compensation - Restricted stock (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||
Jan. 27, 2020 | Mar. 31, 2020 | Mar. 31, 2023 | Mar. 31, 2022 | Mar. 31, 2023 | Mar. 31, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stock-based compensation expense | $ 1,383,405 | $ 3,762,795 | $ 2,775,798 | $ 4,966,843 | ||
MTTR, LLC ("MTTR") | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Shares issued during period | 7,244,739 | |||||
Restricted Stock | MTTR, LLC ("MTTR") | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Shares issued during period | 7,244,739 | |||||
Share repurchase price | $ 0.01 | |||||
Grant date fair value of share | $ 0.54 | |||||
Explicit service period | 4 years 9 months 18 days | |||||
Stock-based compensation expense | $ 1,852,182 | $ 2,003,946 | ||||
Restricted Stock | MTTR, LLC ("MTTR") | Minimum | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Repurchase right lapses on shares (as a percent) | 50% | |||||
Restricted Stock | MTTR, LLC ("MTTR") | Maximum | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Repurchase right lapses on shares (as a percent) | 100% |
Related-Party Transactions (Det
Related-Party Transactions (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||||
Dec. 21, 2021 | Jan. 27, 2020 | Mar. 31, 2023 | Mar. 31, 2022 | Mar. 31, 2023 | Mar. 31, 2022 | Sep. 30, 2022 | |
Stock options | |||||||
Related party | |||||||
Number of shares granted | 1,940,269 | ||||||
Performance-based stock options | |||||||
Related party | |||||||
Number of shares granted | 1,200,000 | ||||||
MTTR, LLC ("MTTR") | |||||||
Related party | |||||||
Shares issued during period | 7,244,739 | ||||||
Contract termination settlement fee | $ 110,000 | ||||||
Related party expense | $ 28,886 | $ 99,380 | $ 65,552 | $ 413,366 | |||
Due to related party, current | $ 0 | $ 0 | $ 18,333 | ||||
Executive Officers | |||||||
Related party | |||||||
Base salary | $ 450,000 | ||||||
Percentage of cash bonus | 50% | ||||||
Executive Officers | Stock options | |||||||
Related party | |||||||
Vesting (as a percent) | 25% | ||||||
Number of shares granted | 800,000 | ||||||
Executive Officers | Performance-based stock options | |||||||
Related party | |||||||
Number of shares granted | 200,000 | ||||||
Number of stock options vested | 200,000 |