Cover
Cover - shares | 9 Months Ended | |
Sep. 30, 2021 | Nov. 09, 2021 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Sep. 30, 2021 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2021 | |
Current Fiscal Year End Date | --12-31 | |
Entity File Number | 001-38148 | |
Entity Registrant Name | CO-DIAGNOSTICS, INC. | |
Entity Central Index Key | 0001692415 | |
Entity Tax Identification Number | 46-2609396 | |
Entity Incorporation, State or Country Code | UT | |
Entity Address, Address Line One | 2401 S. Foothill Drive | |
Entity Address, Address Line Two | Suite D | |
Entity Address, City or Town | Salt Lake City | |
Entity Address, State or Province | UT | |
Entity Address, Postal Zip Code | 84109 | |
City Area Code | (801) | |
Local Phone Number | 438-1036 | |
Title of 12(b) Security | Common Stock | |
Trading Symbol | CODX | |
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 | true | |
Elected Not To Use the Extended Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 28,894,890 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
Current assets | ||
Cash and cash equivalents | $ 82,658,248 | $ 42,976,713 |
Marketable investment securities | 1,251,285 | 4,335,446 |
Accounts receivable, net | 14,589,599 | 12,136,833 |
Inventory | 3,302,925 | 7,995,189 |
Prepaid expenses | 485,095 | 369,028 |
Total current assets | 102,287,152 | 67,813,209 |
Property and equipment, net | 1,524,806 | 949,639 |
Investment in joint venture | 1,034,098 | 1,927,125 |
Deferred tax asset | 512,552 | 547,224 |
Total assets | 105,358,608 | 71,237,197 |
Current liabilities | ||
Accounts payable | 800,003 | 598,318 |
Accrued expenses, current | 2,055,698 | 2,849,503 |
Accrued expenses (related party), current | 30,000 | 120,000 |
Income taxes payable | 1,044,640 | 637,560 |
Deferred revenue | 189,556 | 305,307 |
Total current liabilities | 4,119,897 | 4,510,688 |
Long-term liabilities | ||
Accrued expenses, noncurrent | 1,080,358 | |
Accrued expenses (related party), noncurrent | 30,000 | |
Total long-term liabilities | 1,080,358 | 30,000 |
Total liabilities | 5,200,255 | 4,540,688 |
Commitments and contingencies (Note 9) | ||
Stockholders’ equity | ||
Convertible preferred stock, $0.001 par value; 5,000,000 shares authorized; 0 shares issued and outstanding as of September 30, 2021 and December 31, 2020 | ||
Common stock, $0.001 par value; 100,000,000 shares authorized; 28,894,890 and 28,558,033 shares issued and outstanding as of September 30, 2021 and December 31, 2020, respectively | 28,895 | 28,558 |
Additional paid-in capital | 53,458,589 | 49,157,236 |
Accumulated earnings | 46,670,869 | 17,510,715 |
Total stockholders’ equity | 100,158,353 | 66,696,509 |
Total liabilities and stockholders’ equity | $ 105,358,608 | $ 71,237,197 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Sep. 30, 2021 | Dec. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Convertible preferred stock, par value | $ 0.001 | $ 0.001 |
Convertible preferred stock , shares authorized | 5,000,000 | 5,000,000 |
Convertible preferred stock, shares issued | 0 | 0 |
Convertible preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 28,894,890 | 28,558,033 |
Common stock, shares outstanding | 28,894,890 | 28,558,033 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Income Statement [Abstract] | ||||
Revenue | $ 30,101,353 | $ 21,818,753 | $ 77,484,262 | $ 47,407,555 |
Cost of revenue | 3,311,255 | 5,821,281 | 9,088,175 | 12,278,326 |
Gross profit | 26,790,098 | 15,997,472 | 68,396,087 | 35,129,229 |
Operating expenses | ||||
Sales and marketing | 4,253,091 | 798,474 | 11,303,950 | 1,457,148 |
General and administrative | 2,919,498 | 2,203,417 | 8,323,620 | 5,853,935 |
Research and development | 5,893,350 | 921,889 | 12,779,573 | 2,072,160 |
Depreciation and amortization | 94,038 | 35,490 | 232,757 | 81,456 |
Total operating expenses | 13,159,977 | 3,959,270 | 32,639,900 | 9,464,699 |
Income from operations | 13,630,121 | 12,038,202 | 35,756,187 | 25,664,530 |
Other income (expense) | ||||
Interest income | 11,379 | 29,992 | 36,565 | 75,740 |
Gain (loss) on equity method investment in joint venture | (64,940) | 748,557 | (401,288) | 1,016,297 |
Total other income (expense) | (53,561) | 778,549 | (364,723) | 1,092,037 |
Income before income taxes | 13,576,560 | 12,816,751 | 35,391,464 | 26,756,567 |
Income tax provision (benefit) | 2,100,594 | (2,914,781) | 6,231,310 | (2,914,781) |
Net income | $ 11,475,966 | $ 15,731,532 | $ 29,160,154 | $ 29,671,348 |
Earnings per common share: | ||||
Basic | $ 0.40 | $ 0.56 | $ 1.01 | $ 1.13 |
Diluted | $ 0.38 | $ 0.53 | $ 0.98 | $ 1.07 |
Weighted average shares outstanding: | ||||
Basic | 28,941,357 | 28,084,267 | 28,800,450 | 26,172,439 |
Diluted | 29,952,690 | 29,597,792 | 29,872,415 | 27,621,531 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Cash flows from operating activities | ||
Net income | $ 29,160,154 | $ 29,671,348 |
Adjustments to reconcile net income to cash used in operating activities: | ||
Depreciation and amortization | 232,757 | 81,456 |
Stock-based compensation expense | 3,851,293 | 2,167,376 |
Loss (gain) from equity method investment | 401,288 | (1,016,297) |
Deferred income taxes | 34,672 | (2,914,781) |
Bad debt expense | 156,011 | |
Changes in assets and liabilities: | ||
Accounts receivable | (2,608,777) | (10,509,035) |
Prepaid expenses | (116,068) | (22,076) |
Inventory | 4,432,048 | (10,647,034) |
Deferred revenue | (115,751) | 739,781 |
Income taxes payable | 692,823 | |
Accounts payable and accrued expenses | 82,495 | 656,602 |
Net cash provided by operating activities | 36,202,945 | 8,207,340 |
Cash flows from investing activities | ||
Purchases of property and equipment | (547,708) | (305,683) |
Purchases of marketable investment securities | (9,310,000) | |
Proceeds from maturities of marketable investment securities | 3,084,161 | 3,260,000 |
Investment in joint venture | 491,739 | (714,500) |
Net cash provided by (used in) investing activities | 3,028,192 | (7,070,183) |
Cash flows from financing activities | ||
Proceeds from sale of common stock | 19,470,005 | |
Proceeds from exercise of options and warrants | 450,398 | 1,187,984 |
Payment of offering costs | (1,457,922) | |
Net cash provided by financing activities | 450,398 | 19,200,067 |
Net increase in cash and cash equivalents | 39,681,535 | 20,337,224 |
Cash and cash equivalents at beginning of period | 42,976,713 | 893,138 |
Cash and cash equivalents at end of period | 82,658,248 | 21,230,362 |
Supplemental disclosure of cash flow information | ||
Interest paid | ||
Income taxes paid | 4,733,200 | |
Supplemental disclosure of non-cash investing and financing transactions | ||
Inventory moved to property, plant and equipment | $ 260,216 | $ 117,220 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) | Convertible Preferred Stock [Member]Preferred Stock [Member] | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | Total |
Beginning balance, value at Dec. 31, 2019 | $ 26 | $ 17,343 | $ 26,687,701 | $ (24,967,814) | $ 1,737,256 |
Beginning balance, shares at Dec. 31, 2019 | 25,600 | 17,342,922 | |||
Public offering, net of offering costs of $1,457,922 | $ 7,243 | 18,004,840 | 18,012,083 | ||
Public offering, net of offering costs of $1,457,922, shares | 7,242,954 | ||||
Common stock issued for warrant exercises | $ 720 | 49,280 | 50,000 | ||
Common stock issued for warrant exercises, shares | 719,492 | ||||
Stock-based compensation expense | $ 12 | 432,811 | 432,823 | ||
Stock-based compensation expense, shares | 12,363 | ||||
Conversion of preferred stock to common | $ (26) | $ 2,133 | (2,107) | ||
Conversion of preferred stock to common, shares | (25,600) | 2,133,333 | |||
Net income (loss) | (1,065,193) | (1,065,193) | |||
Ending balance, value at Mar. 31, 2020 | $ 27,451 | 45,172,525 | (26,033,007) | 19,166,969 | |
Ending balance, shares at Mar. 31, 2020 | 27,451,064 | ||||
Beginning balance, value at Dec. 31, 2019 | $ 26 | $ 17,343 | 26,687,701 | (24,967,814) | 1,737,256 |
Beginning balance, shares at Dec. 31, 2019 | 25,600 | 17,342,922 | |||
Net income (loss) | 29,671,348 | ||||
Ending balance, value at Sep. 30, 2020 | $ 28,161 | 48,044,352 | 4,703,534 | 52,776,047 | |
Ending balance, shares at Sep. 30, 2020 | 28,161,259 | ||||
Beginning balance, value at Mar. 31, 2020 | $ 27,451 | 45,172,525 | (26,033,007) | 19,166,969 | |
Beginning balance, shares at Mar. 31, 2020 | 27,451,064 | ||||
Common stock issued for option and warrant exercises | $ 530 | 862,935 | 863,465 | ||
Common stock issued for option and warrant exercises, shares | 530,289 | ||||
Stock-based compensation expense | $ 10 | 691,409 | 691,419 | ||
Stock-based compensation expense, shares | 9,689 | ||||
Net income (loss) | 15,005,009 | 15,005,009 | |||
Ending balance, value at Jun. 30, 2020 | $ 27,991 | 46,726,869 | (11,027,998) | 35,726,862 | |
Ending balance, shares at Jun. 30, 2020 | 27,991,042 | ||||
Common stock issued for option exercises | $ 108 | 274,410 | 274,518 | ||
Common stock issued for option exercises, shares | 108,334 | ||||
Stock-based compensation expense | $ 62 | 1,043,073 | 1,043,135 | ||
Stock-based compensation expense, shares | 61,883 | ||||
Net income (loss) | 15,731,532 | 15,731,532 | |||
Ending balance, value at Sep. 30, 2020 | $ 28,161 | 48,044,352 | 4,703,534 | 52,776,047 | |
Ending balance, shares at Sep. 30, 2020 | 28,161,259 | ||||
Beginning balance, value at Dec. 31, 2020 | $ 28,558 | 49,157,236 | 17,510,715 | 66,696,509 | |
Beginning balance, shares at Dec. 31, 2020 | 28,558,033 | ||||
Common stock issued for option exercises | $ 66 | 148,914 | 148,980 | ||
Common stock issued for option exercises, shares | 65,891 | ||||
Stock-based compensation expense | $ 42 | 1,512,970 | 1,513,012 | ||
Stock-based compensation expense, shares | 41,790 | ||||
Net income (loss) | 7,898,975 | 7,898,975 | |||
Ending balance, value at Mar. 31, 2021 | $ 28,666 | 50,819,120 | 25,409,690 | 76,257,476 | |
Ending balance, shares at Mar. 31, 2021 | 28,665,714 | ||||
Beginning balance, value at Dec. 31, 2020 | $ 28,558 | 49,157,236 | 17,510,715 | $ 66,696,509 | |
Beginning balance, shares at Dec. 31, 2020 | 28,558,033 | ||||
Common stock issued for option exercises, shares | 189,225 | ||||
Net income (loss) | $ 29,160,154 | ||||
Ending balance, value at Sep. 30, 2021 | $ 28,895 | 53,458,589 | 46,670,869 | 100,158,353 | |
Ending balance, shares at Sep. 30, 2021 | 28,894,890 | ||||
Beginning balance, value at Mar. 31, 2021 | $ 28,666 | 50,819,120 | 25,409,690 | 76,257,476 | |
Beginning balance, shares at Mar. 31, 2021 | 28,665,714 | ||||
Common stock issued for option exercises | $ 118 | 295,799 | 295,917 | ||
Common stock issued for option exercises, shares | 118,334 | ||||
Stock-based compensation expense | $ 106 | 927,231 | 927,337 | ||
Stock-based compensation expense, shares | 105,842 | ||||
Net income (loss) | 9,785,213 | 9,785,213 | |||
Ending balance, value at Jun. 30, 2021 | $ 28,890 | 52,042,150 | 35,194,903 | 87,265,943 | |
Ending balance, shares at Jun. 30, 2021 | 28,889,890 | ||||
Common stock issued for option exercises | $ 5 | 5,495 | 5,500 | ||
Common stock issued for option exercises, shares | 5,000 | ||||
Stock-based compensation expense | 1,410,944 | 1,410,944 | |||
Net income (loss) | 11,475,966 | 11,475,966 | |||
Ending balance, value at Sep. 30, 2021 | $ 28,895 | $ 53,458,589 | $ 46,670,869 | $ 100,158,353 | |
Ending balance, shares at Sep. 30, 2021 | 28,894,890 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Stockholders' Equity (Unaudited) (Parenthetical) - USD ($) | 3 Months Ended | 9 Months Ended | |
Mar. 31, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Statement of Stockholders' Equity [Abstract] | |||
Public offering costs | $ 1,457,922 | $ 1,457,922 |
Overview and Basis of Presentat
Overview and Basis of Presentation | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
Overview and Basis of Presentation | Note 1 – Overview and Basis of Presentation Description of Business Co-Diagnostics, Inc., a Utah corporation (the “Company” or “Co-Dx”), is developing robust and innovative molecular tools for detection of infectious diseases, liquid biopsy for cancer screening, and agricultural applications. The Company develops, manufactures, and sells reagents used for diagnostic tests that function via the detection and/or analysis of nucleic acid molecules (DNA or RNA). In connection with the sale of these tests, the Company may sell diagnostic equipment and supplies from other manufacturers. Unaudited Condensed Consolidated Financial Statements The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q as they are prescribed for smaller reporting companies and emerging growth companies. Accordingly, they do not include all the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary to make the financial statements not misleading have been included. Operating results for the three months ended September 30, 2021 are not necessarily indicative of the results that may be expected for the year ending December 31, 2021. These statements should be read in conjunction with the Company’s audited financial statements and related notes for the year ended December 31, 2020, included in the Company’s Annual Report on Form 10-K filed on March 25, 2021. Certain 2020 financial statement amounts have been reclassified to conform to 2021 presentations. Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and the accompanying notes. Such estimates include receivables and other long-lived assets, legal and regulatory contingencies, income taxes, share based arrangements, and others. These estimates and assumptions are based on management’s best estimates and judgments. Actual amounts and results could differ from those estimates. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Note 2 – Summary of Significant Accounting Policies Cash and Cash Equivalents Cash and cash equivalents consist of cash on hand, money market funds and highly liquid investments with an original maturity date of 90 days or less from the date of purchase. The fair value of cash equivalents approximated their carrying value as of September 30, 2021 and December 31, 2020. The Company has its cash and cash equivalents with large creditworthy financial institutions and the balance exceeded federally insured limits. The Company has not experienced any losses in such accounts, and management believes the Company is not exposed to any significant credit risk on cash and cash equivalents. Marketable Investment Securities The Company’s marketable investment securities are comprised of investments in certificates of deposit. The Company determines the appropriate classification of its marketable investment securities at the time of purchase and re-evaluates such designation at each balance sheet date. The Company has classified and accounted for its marketable investment securities as available-for-sale securities as the Company may sell these securities at any time for use in its current operations or for other purposes, even prior to maturity. As a result, the Company classifies its marketable investment securities, including securities with stated maturities beyond twelve months, within current assets in the condensed consolidated balance sheets. Any unrealized gains or losses are immaterial. Accounts Receivable Trade accounts receivable are recorded at the invoiced amount (net of allowance) and do not bear interest. The Company maintains an allowance for doubtful accounts for amounts the Company does not expect to collect. In establishing the required allowance, management considers historical losses, current market condition, customers’ financial condition, the age of receivables, and current payment patterns. Account balances are written off against the allowance once the receivable is deemed uncollectible. Recoveries of trade receivables previously written off are recorded when collected. At September 30, 2021, total accounts receivable was $ 15,347,499 757,900 14,589,599 12,928,633 791,800 12,136,833 Equity-Method Investments Our equity method investments are initially recorded at cost and are included in other long-term assets in the accompanying condensed consolidated balance sheet. We adjust the carrying value of our investment based on our share of the earnings or losses in the periods which they are reported by the investee until the carrying amount is zero. The earnings or losses are included in other income (expense) in the accompanying condensed consolidated statements of operations. Inventory Inventory is stated at the lower of cost or net-realizable value. Inventory cost is determined on a first-in first-out basis that approximates average cost in accordance with ASC 330-10-30-12. At September 30, 2021, the Company had $ 3,302,925 925,620 2,377,305 7,995,189 598,881 7,396,308 Property and Equipment Property and equipment are stated at cost less accumulated depreciation and amortization. Depreciation is provided using the straight-line method over the estimated useful lives of the property, generally from three five years The Company reviews its long-lived assets, including property and equipment, for impairment whenever an event or change in facts and circumstances indicates that their carrying amounts may not be recoverable. Recoverability of these assets is measured by comparing the carrying amount to the estimated undiscounted future cash flows expected to be generated. If the carrying amount exceeds the undiscounted cash flows, the assets are determined to be impaired and an impairment charge is recognized as the amount by which the carrying amount exceeds fair value. Revenue Recognition The Company generates revenue from product sales and license sales. The Company recognizes revenue when all of the following criteria are satisfied: (i) identification of the promised goods or services in the contract; (ii) determination of whether the promised goods or services are performance obligations, including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when, or as the Company satisfies each performance obligation. The Company constrains revenue by giving consideration to factors that could otherwise lead to a probable reversal of revenue. The Company records any payments received from customers prior to the Company fulfilling its performance obligation(s) as deferred revenue. Deferred Revenue Deferred revenue primarily consists of payments received from customers prior to the Company fulfilling its performance obligation of providing the product. When this occurs, the Company records a contract liability as deferred revenue. Deferred revenue is recognized as revenue as the related performance obligations are satisfied. Research and Development Research and development costs are expensed when incurred. For the three and nine months ended September 30, 2021, the Company expensed $ 5,893,350 12,779,573 921,889 2,072,160 Stock-based Compensation The Company has granted stock-based awards, including restricted stock, stock options, stock warrants and restricted stock units (“RSUs”), to its employees, certain consultants and members of its board of directors. The Company records stock-based compensation based on the grant date fair value of the awards and recognizes the fair value of those awards as expense using the straight-line method over the requisite service period of the award. The Company estimates the grant date fair value of stock options using the Black-Scholes option-pricing model. When an award is forfeited prior to the vesting date, the Company recognizes an adjustment for the previously recognized expense in the period of the forfeiture. Income Taxes The Company accounts for income taxes in accordance with the liability method of accounting for income taxes. Under this method, deferred income tax assets and deferred income tax liabilities represent the tax effect of temporary differences between financial reporting and tax reporting measured at enacted tax rates in effect for the year in which the differences are expected to reverse. The Company recognizes only the impact of tax positions that, based on their technical merits, are more likely than not to be sustained upon an audit by the taxing authority. Valuation allowances are provided when it is more-likely-than-not that some or all of the deferred income tax assets may not be realized. In assessing the need for a valuation allowance, the Company has considered its historical levels of income, expectations of future taxable income and ongoing tax planning strategies. Developing the provision for income taxes, including the effective tax rate and analysis of potential tax exposure items, if any, requires significant judgment and expertise in federal and state income tax laws, regulations and strategies, including the determination of deferred income tax assets and liabilities and any estimated valuation allowances deemed necessary to value deferred income tax assets. Judgments and tax strategies are subject to audit by various taxing authorities. While the Company believes it has no significant uncertain income tax positions in the consolidated financial statements, adverse determinations by these taxing authorities could have a material adverse effect on the consolidated financial positions, result of operations, or cash flows. Concentrations Risk and Significant Customers The Company had certain customers which are each responsible for generating 10% or more of the total revenue for the three and nine months ended September 30, 2021. Two customers together accounted for approximately 55 49 Two customers each accounted for more than 10% of accounts receivable at September 30, 2021 and December 31, 2020. These two customers together accounted for approximately 52 48 Net Income per Share Basic net income or loss per common share is computed by dividing net income or loss applicable to common shareholders by the weighted average number of shares outstanding during each period. Diluted net income or loss per share is computed by dividing net income or loss attributable to common stockholders by the weighted-average number of shares of common stock outstanding during the period increased by common shares that could be issued upon conversion or exercise of other outstanding securities to the extent those additional common shares would be dilutive. The dilutive effect of potentially dilutive securities is reflected in diluted net income or loss per share by application of the treasury stock method. During periods when the Company is in a net loss position, basic net loss per share is the same as diluted net loss per share as the effects of potentially dilutive securities are anti-dilutive. Recent Accounting Pronouncements From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (“FASB”) that are adopted by the Company as of the specified effective date. If not discussed, management believes that the impact of recently issued standards, which are not yet effective, will not have a material impact on the Company’s financial statements upon adoption. As an emerging growth company (“EGC”), the Company has elected to take advantage of the benefits of the extended transition period provided for in Section 7(a)(2)(B) of the Securities Act of 1933, as amended, for complying with new or revised accounting standards which allows the Company to defer adoption of certain accounting standards until those standards would otherwise apply to private companies. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842), which requires recognition of leased assets and liabilities on the balance sheet and disclosing key information about leasing arrangements. This update is effective for annual periods and interim periods with those periods beginning after December 15, 2021, for public EGC companies like us. The Company expects to use the modified retrospective transition method with the option to recognize a cumulative-effect adjustment at the date of adoption. The Company expects its balance sheet will be impacted as it records right-of-use assets and lease liabilities on its consolidated balance sheet but does not expect the adoption of this standard will have a material impact on its consolidated statements of operations and cash flows. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments-Credit Losses (Topic 326) (“ASU 2016-13”), which requires the measurement and recognition of expected credit losses for certain financial instruments, which includes the Company’s accounts receivable. ASU 2016-13 replaces the existing incurred loss impairment model with an expected loss methodology, which will result in more timely recognition of credit losses. The update is effective for annual periods and interim periods with those periods beginning after December 15, 2021, for public EGC companies like us. The standard requires a cumulative effect adjustment to the balance sheet as of the beginning of the first early reporting period in which the guidance is effective. The Company is evaluating the impact of the adoption of ASU 2016-13 on its consolidated financial statements. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Note 3 – Fair Value Measurements The Company measures and records certain financial assets at fair value on a recurring basis. Fair value is based on the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company’s financial instruments that are measured at fair value on a recurring basis consist of money market funds. The following three levels of inputs are used to measure the fair value of financial instruments: Level 1: Quoted market prices in active markets for identical assets or liabilities. Level 2: Observable market-based inputs or unobservable inputs that are corroborated by market data. Level 3: Unobservable inputs that are not corroborated by market data. The Company’s financial instruments that are measured at fair value on a recurring basis consist of certificates of deposit. The following table summarizes the assets measured at fair value on a recurring basis as of September 30, 2021, and December 31, 2020, by level within the fair value hierarchy: Summary of Assets Measured at Fair Value on Recurring Basis September 30, 2021 (Level 1) (Level 2) (Level 3) Total Marketable investment securities: Certificates of deposit $ - $ 1,251,285 $ - $ 1,251,285 December 31, 2020 (Level 1) (Level 2) (Level 3) Total Marketable investment securities: Certificates of deposit $ - $ 4,335,446 $ - $ 4,335,446 |
Revenue
Revenue | 9 Months Ended |
Sep. 30, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Note 4 – Revenue The following table sets forth revenue by geographic area: Summary of Revenue by Geographic Area Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 United States $ 16,907,574 $ 14,054,316 $ 34,701,035 $ 28,151,446 Rest of World 13,193,779 7,764,437 42,783,227 19,256,109 Total $ 30,101,353 $ 21,818,753 $ 77,484,262 $ 47,407,555 Percentage of revenue by area: United States 56 % 64 % 45 % 59 % Rest of World 44 % 36 % 55 % 41 % Deferred Revenue Changes in the Company’s deferred revenue balance for the nine months ended September 30, 2021 were as follows: Schedule of Deferred Revenue Balance as of December 31, 2020 $ 305,307 Revenue recognized included in deferred revenue balance at the beginning of the period (194,964 ) Increase due to prepayments from customers 79,213 Balance as of September 30, 2021 $ 189,556 The Company expects to perform its performance obligation and recognize the deferred revenue as revenue during the year ended December 31, 2021. |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Sep. 30, 2021 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Note 5 – Earnings Per Share The following table reconciles the numerator and the denominator used to calculate basic and diluted earnings per share for three and nine months ended September 30, 2021 and 2020: Schedule of Basic and Diluted Earnings Per Share Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Numerator Net income (loss), as reported $ 11,475,966 $ 15,731,532 $ 29,160,154 $ 29,671,348 Denominator Weighted average shares, basic 28,941,357 28,084,267 28,800,450 26,172,439 Dilutive effect of stock options, warrants and RSUs 1,011,333 1,513,525 1,071,965 1,449,092 Shares used to compute diluted earnings per share 29,952,690 29,597,792 29,872,415 27,621,531 Basic earnings per share $ 0.40 $ 0.56 $ 1.01 $ 1.13 Diluted earnings per share $ 0.38 $ 0.53 $ 0.98 $ 1.07 For the three and nine months ended September 30, 2021, potentially dilutive securities of 50,000 147,436 50,000 |
Stock-Based Compensation
Stock-Based Compensation | 9 Months Ended |
Sep. 30, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Note 6 – Stock-Based Compensation Stock Incentive Plans The Co-Diagnostics, Inc. 2015 Long Term Incentive Plan (the “Incentive Plan”) reserves an aggregate of 6,000,000 2,064,933 Stock Options The following table summarizes option activity during the nine months ended September 30, 2021: Schedule of Option Activity Number of Options Weighted Average Exercise Price Weighted Average Fair Value Weighted Average Remaining Contractual Life (Years) Outstanding at December 31, 2020 1,300,588 $ 2.44 $ 1.24 Granted - - - Expired - - - Forfeited/Cancelled - - - Exercised (189,225 ) 2.38 1.12 Outstanding at September 30, 2021 1,111,363 $ 2.12 $ 1.31 7.18 Exercisable at September 30, 2021 1,094,697 $ 2.01 $ 1.18 7.16 The total intrinsic value of options exercised during the nine months ended September 30, 2021 was approximately $ 1.3 8.5 Stock-based compensation cost is measured at the grant date based on the fair value of the award granted and recognized as expense over the vesting period using the straight-line method. The Company uses the Black-Scholes model to value options granted. In January 2021, the Company modified the exercise price of 100,000 16.49 9.30 65,000 50,000 As of September 30, 2021, there were 16,666 of unvested options and $ 119,897 0.7 Restricted Stock Units The grant date fair value of RSUs granted is determined using the closing market price of the Company’s common stock on the grant date with the associated compensation expense amortized over the vesting period of the awards. The following table sets forth the outstanding RSUs and related activity for the nine months ended September 30, 2021: Schedule of Outstanding Restricted Stock Units and Related Activity Number of RSUs Weighted Average Grant Date Fair Value Unvested at December 31, 2020 522,500 $ 10.49 Granted 1,217,500 9.76 Vested (210,834 ) 10.24 Forfeited/Cancelled (3,750 ) 10.49 Unvested at September 30, 2021 1,525,416 $ 9.94 As of September 30, 2021, there was approximately $ 13.5 2.5 Warrants The Company has issued warrants related to past financings and as compensation to third parties for services provided. The Company estimates the fair value of issued warrants on the date of issuance as determined using a Black-Scholes pricing model. The Company amortizes the fair value of issued warrants using a vesting schedule based on the terms and conditions of each warrant if granted for services. The following table summarizes warrant activity during the nine months ended September 30, 2021: Schedule of Warrant Activity Number of Warrants Weighted Average Exercise Price Weighted Average Fair Value Weighted Average Remaining Contractual Life (Years) Outstanding at December 31, 2020 70,000 $ 1.83 $ 5.21 Granted - - - Forfeited/Cancelled - - - Exercised - - - Outstanding at September 30, 2021 70,000 $ 1.83 $ 5.21 2.5 The aggregate intrinsic value of outstanding warrants at September 30, 2021 was approximately $ 553,000 Stock Issued for Services The Company has issued restricted stock to third parties for services provided. The grant date fair value of the restricted stock granted is determined using the closing market price of the Company’s common stock on the grant date with the associated compensation expense amortized over the vesting period of the stock awards. The Company has issued 5,548 Stock-Based Compensation Expense The Company recognized stock-based compensation expense related to the types of awards discussed above as follows: Schedule of Recognized Stock-based Compensation Expenses Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Options $ 66,247 $ 128,344 $ 219,033 $ 831,542 Restricted stock units 1,344,697 - 3,580,360 - Warrants - - - 303,802 Stock - 914,790 51,900 1,032,032 Total stock-based compensation expense $ 1,410,944 $ 1,043,134 $ 3,851,293 $ 2,167,376 |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 7 – Income Taxes For the three months ended September 30, 2021, the Company recognized an expense from income taxes of $ 2,100,594 15.5 6,231,310 17.6 21.0 2,914,781 |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2021 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Note 8 – Related Party Transactions The Company acquired the exclusive rights to the CoPrimer technology pursuant to an exclusive license agreement, dated April 2014 (the “Exclusive License Agreement”), between the Company and DNA Logix, Inc., which was assigned to Dr. Brent Satterfield, a former executive officer, prior to the Company’s acquisition of DNA Logix, Inc. On March 1, 2017, the Company entered into an amendment to its Exclusive License Agreement for its Cooperative Primers (“License”) technology with Dr. Satterfield. The amendment provides in part that all accrued royalties under the License cease as of January 1, 2017, and the Company began in January 2017 to pay to Dr. Satterfield $ 700,000 10,000 30,000 120,000 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 9 – Commitments and Contingencies Lease Obligations The Company’s offices are located at 2401 S. Foothill Dr., Suite D, Salt Lake City, Utah 84109-1479. In February 2020, the Company entered into a 4 -year lease agreement for its office space and in March 2020, the Company entered into an addendum with our landlord for additional space. The new aggregate space consists of approximately 13,687 square feet at a monthly rate of $ 28,825 February 2024 86,588 259,763 86,588 225,374 Schedule of Future Minimum Lease Payments Year Ending December 31, 2021 (remainder) $ 71,475 2022 293,595 2023 303,059 2024 50,774 Total lease payments $ 718,903 Litigation Liabilities for loss contingencies arising from claims, assessments, litigation, fines, and penalties and other sources are recorded when it is probable that a liability has been incurred and the amount can be reasonably estimated. Legal costs incurred in connection with loss contingencies are expensed as incurred. In July and September 2020, securities class action complaints were filed by certain stockholders of the Company against the Company claiming that the Company promulgated false and misleading press releases to increase the price of our stock to improperly benefit the officers and directors of the Company. The plaintiffs demand compensatory damages sustained as a result of the Company’s alleged wrongdoing in an amount to be proven at trial. The Company believes these lawsuits are without merit and intends to defend the cases vigorously. The Company is unable to estimate a range of loss, if any, that could result were there to be an adverse final decision in these cases. As of the date of this report, the Company does not believe it is probable that these cases will result in an unfavorable outcome; however, if an unfavorable outcome were to occur in these cases, it is possible that the impact could be material to the Company’s results of operations in the period(s) in which any such outcome becomes probable and estimable. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 10 – Subsequent Events The Company evaluated subsequent events pursuant to ASC Topic 855 and has determined that there are no events that need to be reported. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents consist of cash on hand, money market funds and highly liquid investments with an original maturity date of 90 days or less from the date of purchase. The fair value of cash equivalents approximated their carrying value as of September 30, 2021 and December 31, 2020. The Company has its cash and cash equivalents with large creditworthy financial institutions and the balance exceeded federally insured limits. The Company has not experienced any losses in such accounts, and management believes the Company is not exposed to any significant credit risk on cash and cash equivalents. |
Marketable Investment Securities | Marketable Investment Securities The Company’s marketable investment securities are comprised of investments in certificates of deposit. The Company determines the appropriate classification of its marketable investment securities at the time of purchase and re-evaluates such designation at each balance sheet date. The Company has classified and accounted for its marketable investment securities as available-for-sale securities as the Company may sell these securities at any time for use in its current operations or for other purposes, even prior to maturity. As a result, the Company classifies its marketable investment securities, including securities with stated maturities beyond twelve months, within current assets in the condensed consolidated balance sheets. Any unrealized gains or losses are immaterial. |
Accounts Receivable | Accounts Receivable Trade accounts receivable are recorded at the invoiced amount (net of allowance) and do not bear interest. The Company maintains an allowance for doubtful accounts for amounts the Company does not expect to collect. In establishing the required allowance, management considers historical losses, current market condition, customers’ financial condition, the age of receivables, and current payment patterns. Account balances are written off against the allowance once the receivable is deemed uncollectible. Recoveries of trade receivables previously written off are recorded when collected. At September 30, 2021, total accounts receivable was $ 15,347,499 757,900 14,589,599 12,928,633 791,800 12,136,833 |
Equity-Method Investments | Equity-Method Investments Our equity method investments are initially recorded at cost and are included in other long-term assets in the accompanying condensed consolidated balance sheet. We adjust the carrying value of our investment based on our share of the earnings or losses in the periods which they are reported by the investee until the carrying amount is zero. The earnings or losses are included in other income (expense) in the accompanying condensed consolidated statements of operations. |
Inventory | Inventory Inventory is stated at the lower of cost or net-realizable value. Inventory cost is determined on a first-in first-out basis that approximates average cost in accordance with ASC 330-10-30-12. At September 30, 2021, the Company had $ 3,302,925 925,620 2,377,305 7,995,189 598,881 7,396,308 |
Property and Equipment | Property and Equipment Property and equipment are stated at cost less accumulated depreciation and amortization. Depreciation is provided using the straight-line method over the estimated useful lives of the property, generally from three five years The Company reviews its long-lived assets, including property and equipment, for impairment whenever an event or change in facts and circumstances indicates that their carrying amounts may not be recoverable. Recoverability of these assets is measured by comparing the carrying amount to the estimated undiscounted future cash flows expected to be generated. If the carrying amount exceeds the undiscounted cash flows, the assets are determined to be impaired and an impairment charge is recognized as the amount by which the carrying amount exceeds fair value. |
Revenue Recognition | Revenue Recognition The Company generates revenue from product sales and license sales. The Company recognizes revenue when all of the following criteria are satisfied: (i) identification of the promised goods or services in the contract; (ii) determination of whether the promised goods or services are performance obligations, including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when, or as the Company satisfies each performance obligation. The Company constrains revenue by giving consideration to factors that could otherwise lead to a probable reversal of revenue. The Company records any payments received from customers prior to the Company fulfilling its performance obligation(s) as deferred revenue. |
Deferred Revenue | Deferred Revenue Deferred revenue primarily consists of payments received from customers prior to the Company fulfilling its performance obligation of providing the product. When this occurs, the Company records a contract liability as deferred revenue. Deferred revenue is recognized as revenue as the related performance obligations are satisfied. |
Research and Development | Research and Development Research and development costs are expensed when incurred. For the three and nine months ended September 30, 2021, the Company expensed $ 5,893,350 12,779,573 921,889 2,072,160 |
Stock-based Compensation | Stock-based Compensation The Company has granted stock-based awards, including restricted stock, stock options, stock warrants and restricted stock units (“RSUs”), to its employees, certain consultants and members of its board of directors. The Company records stock-based compensation based on the grant date fair value of the awards and recognizes the fair value of those awards as expense using the straight-line method over the requisite service period of the award. The Company estimates the grant date fair value of stock options using the Black-Scholes option-pricing model. When an award is forfeited prior to the vesting date, the Company recognizes an adjustment for the previously recognized expense in the period of the forfeiture. |
Income Taxes | Income Taxes The Company accounts for income taxes in accordance with the liability method of accounting for income taxes. Under this method, deferred income tax assets and deferred income tax liabilities represent the tax effect of temporary differences between financial reporting and tax reporting measured at enacted tax rates in effect for the year in which the differences are expected to reverse. The Company recognizes only the impact of tax positions that, based on their technical merits, are more likely than not to be sustained upon an audit by the taxing authority. Valuation allowances are provided when it is more-likely-than-not that some or all of the deferred income tax assets may not be realized. In assessing the need for a valuation allowance, the Company has considered its historical levels of income, expectations of future taxable income and ongoing tax planning strategies. Developing the provision for income taxes, including the effective tax rate and analysis of potential tax exposure items, if any, requires significant judgment and expertise in federal and state income tax laws, regulations and strategies, including the determination of deferred income tax assets and liabilities and any estimated valuation allowances deemed necessary to value deferred income tax assets. Judgments and tax strategies are subject to audit by various taxing authorities. While the Company believes it has no significant uncertain income tax positions in the consolidated financial statements, adverse determinations by these taxing authorities could have a material adverse effect on the consolidated financial positions, result of operations, or cash flows. |
Concentrations Risk and Significant Customers | Concentrations Risk and Significant Customers The Company had certain customers which are each responsible for generating 10% or more of the total revenue for the three and nine months ended September 30, 2021. Two customers together accounted for approximately 55 49 Two customers each accounted for more than 10% of accounts receivable at September 30, 2021 and December 31, 2020. These two customers together accounted for approximately 52 48 |
Net Income per Share | Net Income per Share Basic net income or loss per common share is computed by dividing net income or loss applicable to common shareholders by the weighted average number of shares outstanding during each period. Diluted net income or loss per share is computed by dividing net income or loss attributable to common stockholders by the weighted-average number of shares of common stock outstanding during the period increased by common shares that could be issued upon conversion or exercise of other outstanding securities to the extent those additional common shares would be dilutive. The dilutive effect of potentially dilutive securities is reflected in diluted net income or loss per share by application of the treasury stock method. During periods when the Company is in a net loss position, basic net loss per share is the same as diluted net loss per share as the effects of potentially dilutive securities are anti-dilutive. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (“FASB”) that are adopted by the Company as of the specified effective date. If not discussed, management believes that the impact of recently issued standards, which are not yet effective, will not have a material impact on the Company’s financial statements upon adoption. As an emerging growth company (“EGC”), the Company has elected to take advantage of the benefits of the extended transition period provided for in Section 7(a)(2)(B) of the Securities Act of 1933, as amended, for complying with new or revised accounting standards which allows the Company to defer adoption of certain accounting standards until those standards would otherwise apply to private companies. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842), which requires recognition of leased assets and liabilities on the balance sheet and disclosing key information about leasing arrangements. This update is effective for annual periods and interim periods with those periods beginning after December 15, 2021, for public EGC companies like us. The Company expects to use the modified retrospective transition method with the option to recognize a cumulative-effect adjustment at the date of adoption. The Company expects its balance sheet will be impacted as it records right-of-use assets and lease liabilities on its consolidated balance sheet but does not expect the adoption of this standard will have a material impact on its consolidated statements of operations and cash flows. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments-Credit Losses (Topic 326) (“ASU 2016-13”), which requires the measurement and recognition of expected credit losses for certain financial instruments, which includes the Company’s accounts receivable. ASU 2016-13 replaces the existing incurred loss impairment model with an expected loss methodology, which will result in more timely recognition of credit losses. The update is effective for annual periods and interim periods with those periods beginning after December 15, 2021, for public EGC companies like us. The standard requires a cumulative effect adjustment to the balance sheet as of the beginning of the first early reporting period in which the guidance is effective. The Company is evaluating the impact of the adoption of ASU 2016-13 on its consolidated financial statements. |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Fair Value Disclosures [Abstract] | |
Summary of Assets Measured at Fair Value on Recurring Basis | The Company’s financial instruments that are measured at fair value on a recurring basis consist of certificates of deposit. The following table summarizes the assets measured at fair value on a recurring basis as of September 30, 2021, and December 31, 2020, by level within the fair value hierarchy: Summary of Assets Measured at Fair Value on Recurring Basis September 30, 2021 (Level 1) (Level 2) (Level 3) Total Marketable investment securities: Certificates of deposit $ - $ 1,251,285 $ - $ 1,251,285 December 31, 2020 (Level 1) (Level 2) (Level 3) Total Marketable investment securities: Certificates of deposit $ - $ 4,335,446 $ - $ 4,335,446 |
Revenue (Tables)
Revenue (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Summary of Revenue by Geographic Area | The following table sets forth revenue by geographic area: Summary of Revenue by Geographic Area Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 United States $ 16,907,574 $ 14,054,316 $ 34,701,035 $ 28,151,446 Rest of World 13,193,779 7,764,437 42,783,227 19,256,109 Total $ 30,101,353 $ 21,818,753 $ 77,484,262 $ 47,407,555 Percentage of revenue by area: United States 56 % 64 % 45 % 59 % Rest of World 44 % 36 % 55 % 41 % |
Schedule of Deferred Revenue | Changes in the Company’s deferred revenue balance for the nine months ended September 30, 2021 were as follows: Schedule of Deferred Revenue Balance as of December 31, 2020 $ 305,307 Revenue recognized included in deferred revenue balance at the beginning of the period (194,964 ) Increase due to prepayments from customers 79,213 Balance as of September 30, 2021 $ 189,556 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of Basic and Diluted Earnings Per Share | The following table reconciles the numerator and the denominator used to calculate basic and diluted earnings per share for three and nine months ended September 30, 2021 and 2020: Schedule of Basic and Diluted Earnings Per Share Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Numerator Net income (loss), as reported $ 11,475,966 $ 15,731,532 $ 29,160,154 $ 29,671,348 Denominator Weighted average shares, basic 28,941,357 28,084,267 28,800,450 26,172,439 Dilutive effect of stock options, warrants and RSUs 1,011,333 1,513,525 1,071,965 1,449,092 Shares used to compute diluted earnings per share 29,952,690 29,597,792 29,872,415 27,621,531 Basic earnings per share $ 0.40 $ 0.56 $ 1.01 $ 1.13 Diluted earnings per share $ 0.38 $ 0.53 $ 0.98 $ 1.07 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Option Activity | The following table summarizes option activity during the nine months ended September 30, 2021: Schedule of Option Activity Number of Options Weighted Average Exercise Price Weighted Average Fair Value Weighted Average Remaining Contractual Life (Years) Outstanding at December 31, 2020 1,300,588 $ 2.44 $ 1.24 Granted - - - Expired - - - Forfeited/Cancelled - - - Exercised (189,225 ) 2.38 1.12 Outstanding at September 30, 2021 1,111,363 $ 2.12 $ 1.31 7.18 Exercisable at September 30, 2021 1,094,697 $ 2.01 $ 1.18 7.16 |
Schedule of Outstanding Restricted Stock Units and Related Activity | The grant date fair value of RSUs granted is determined using the closing market price of the Company’s common stock on the grant date with the associated compensation expense amortized over the vesting period of the awards. The following table sets forth the outstanding RSUs and related activity for the nine months ended September 30, 2021: Schedule of Outstanding Restricted Stock Units and Related Activity Number of RSUs Weighted Average Grant Date Fair Value Unvested at December 31, 2020 522,500 $ 10.49 Granted 1,217,500 9.76 Vested (210,834 ) 10.24 Forfeited/Cancelled (3,750 ) 10.49 Unvested at September 30, 2021 1,525,416 $ 9.94 |
Schedule of Warrant Activity | The following table summarizes warrant activity during the nine months ended September 30, 2021: Schedule of Warrant Activity Number of Warrants Weighted Average Exercise Price Weighted Average Fair Value Weighted Average Remaining Contractual Life (Years) Outstanding at December 31, 2020 70,000 $ 1.83 $ 5.21 Granted - - - Forfeited/Cancelled - - - Exercised - - - Outstanding at September 30, 2021 70,000 $ 1.83 $ 5.21 2.5 |
Schedule of Recognized Stock-based Compensation Expenses | The Company recognized stock-based compensation expense related to the types of awards discussed above as follows: Schedule of Recognized Stock-based Compensation Expenses Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Options $ 66,247 $ 128,344 $ 219,033 $ 831,542 Restricted stock units 1,344,697 - 3,580,360 - Warrants - - - 303,802 Stock - 914,790 51,900 1,032,032 Total stock-based compensation expense $ 1,410,944 $ 1,043,134 $ 3,851,293 $ 2,167,376 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Lease Payments | Schedule of Future Minimum Lease Payments Year Ending December 31, 2021 (remainder) $ 71,475 2022 293,595 2023 303,059 2024 50,774 Total lease payments $ 718,903 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | |
Product Information [Line Items] | |||||
Accounts receivable | $ 15,347,499 | $ 15,347,499 | $ 12,928,633 | ||
Doubtful accounts | 757,900 | 757,900 | 791,800 | ||
Accounts receivable, net | 14,589,599 | 14,589,599 | 12,136,833 | ||
Inventory | 3,302,925 | 3,302,925 | 7,995,189 | ||
Inventory finished goods | 925,620 | 925,620 | 598,881 | ||
Inventory raw materials | 2,377,305 | 2,377,305 | $ 7,396,308 | ||
Research and development costs | $ 5,893,350 | $ 921,889 | $ 12,779,573 | $ 2,072,160 | |
Two Customers Together [Member] | Customer Concentration Risk [Member] | Revenue Benchmark [Member] | |||||
Product Information [Line Items] | |||||
Concentration risk percentage | 55.00% | 49.00% | |||
Two Customers Together [Member] | Customer Concentration Risk [Member] | Accounts Receivable [Member] | |||||
Product Information [Line Items] | |||||
Concentration risk percentage | 52.00% | 48.00% | |||
Minimum [Member] | |||||
Product Information [Line Items] | |||||
Estimated useful life of property | 3 years | ||||
Maximum [Member] | |||||
Product Information [Line Items] | |||||
Estimated useful life of property | 5 years |
Summary of Assets Measured at F
Summary of Assets Measured at Fair Value on Recurring Basis (Details) - Fair Value, Recurring [Member] - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of assets | $ 1,251,285 | $ 4,335,446 |
Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of assets | ||
Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of assets | 1,251,285 | 4,335,446 |
Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of assets |
Summary of Revenue by Geographi
Summary of Revenue by Geographic Area (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 30,101,353 | $ 21,818,753 | $ 77,484,262 | $ 47,407,555 |
Americas [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 16,907,574 | $ 14,054,316 | $ 34,701,035 | $ 28,151,446 |
Americas [Member] | Revenue Benchmark [Member] | Geographic Concentration Risk [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of revenue | 56.00% | 64.00% | 45.00% | 59.00% |
Rest Of World [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 13,193,779 | $ 7,764,437 | $ 42,783,227 | $ 19,256,109 |
Rest Of World [Member] | Revenue Benchmark [Member] | Geographic Concentration Risk [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of revenue | 44.00% | 36.00% | 55.00% | 41.00% |
Schedule of Deferred Revenue (D
Schedule of Deferred Revenue (Details) | 9 Months Ended |
Sep. 30, 2021USD ($) | |
Revenue from Contract with Customer [Abstract] | |
Deferred revenue, beginning balance | $ 305,307 |
Revenue recognized included in deferred revenue balance at the beginning of the period | (194,964) |
Increase due to prepayments from customers | 79,213 |
Deferred revenue, ending balance | $ 189,556 |
Schedule of Basic and Diluted E
Schedule of Basic and Diluted Earnings Per Share (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Earnings Per Share [Abstract] | ||||||||
Net income (loss), as reported | $ 11,475,966 | $ 9,785,213 | $ 7,898,975 | $ 15,731,532 | $ 15,005,009 | $ (1,065,193) | $ 29,160,154 | $ 29,671,348 |
Weighted average shares, basic | 28,941,357 | 28,084,267 | 28,800,450 | 26,172,439 | ||||
Dilutive effect of stock options, warrants and RSUs | 1,011,333 | 1,513,525 | 1,071,965 | 1,449,092 | ||||
Shares used to compute diluted earnings per share | 29,952,690 | 29,597,792 | 29,872,415 | 27,621,531 | ||||
Basic earnings per share | $ 0.40 | $ 0.56 | $ 1.01 | $ 1.13 | ||||
Diluted earnings per share | $ 0.38 | $ 0.53 | $ 0.98 | $ 1.07 |
Earnings Per Share (Details Nar
Earnings Per Share (Details Narrative) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Earnings Per Share [Abstract] | ||||
Securities excluded from computation of diluted earnings per share | 50,000 | 50,000 | 147,436 | 50,000 |
Schedule of Option Activity (De
Schedule of Option Activity (Details) | 9 Months Ended |
Sep. 30, 2021$ / sharesshares | |
Share-based Payment Arrangement [Abstract] | |
Number of Options Outstanding, Beginning | shares | 1,300,588 |
Weighted Average Exercise Price Outstanding, Beginning | $ 2.44 |
Weighted Average Fair Value Outstanding, Beginning | $ 1.24 |
Number of Options Outstanding, Granted | shares | |
Weighted Average Exercise Price Granted | |
Weighted Average Fair Value Granted | |
Number of Options Outstanding, Expired | shares | |
Weighted Average Exercise Price Expired | |
Weighted Average Fair Value Expired | |
Number of Options Outstanding, Forfeited/Cancelled | shares | |
Weighted Average Exercise Price Forfeited/Cancelled | |
Weighted Average Fair Value Forfeited/Cancelled | |
Number of Options Outstanding, Exercised | shares | (189,225) |
Weighted Average Exercise Price Exercised | $ 2.38 |
Weighted Average Fair Value Exercised | $ 1.12 |
Number of Options Outstanding, Ending | shares | 1,111,363 |
Weighted Average Exercise Price Outstanding, Ending | $ 2.12 |
Weighted Average Fair Value Outstanding, Ending | $ 1.31 |
Weighted-average Remaining Contractual Life (years) Outstanding, Ending | 7 years 2 months 4 days |
Number of Options Exercisable Ending | shares | 1,094,697 |
Weighted Average Exercise Price, Exercisable Ending | $ 2.01 |
Weighted Average Fair Value, Exercisable Ending | $ 1.18 |
Weighted-average Remaining Contractual Life (years), Exercisable Ending | 7 years 1 month 28 days |
Schedule of Outstanding Restric
Schedule of Outstanding Restricted Stock Units and Related Activity (Details) - Restricted Stock Units (RSUs) [Member] | 9 Months Ended |
Sep. 30, 2021$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Restricted Stock Units, Outstanding Beginning | shares | 522,500 |
Weighted Average Grant Date Fair Value, Outstanding Beginning | $ / shares | $ 10.49 |
Number of Restricted Stock Units, Granted | shares | 1,217,500 |
Weighted Average Grant Date Fair Value, Granted | $ / shares | $ 9.76 |
Number of Restricted Stock Units, Vested | shares | (210,834) |
Weighted Average Grant Date Fair Value, Vested | $ / shares | $ 10.24 |
Number of Restricted Stock Units, Forfeited/Cancelled | shares | (3,750) |
Weighted Average Grant Date Fair Value, Forfeited/Cancelled | $ / shares | $ 10.49 |
Number of Restricted Stock Units, Outstanding Ending | shares | 1,525,416 |
Weighted Average Grant Date Fair Value, Outstanding Ending | $ / shares | $ 9.94 |
Schedule of Warrant Activity (D
Schedule of Warrant Activity (Details) | 9 Months Ended |
Sep. 30, 2021$ / sharesshares | |
Share-based Payment Arrangement [Abstract] | |
Number of Warrants Outstanding, Beginning | shares | 70,000 |
Weighted Average Exercise Price, Beginning | $ 1.83 |
Weighted Average Fair Value, Beginning | $ 5.21 |
Number of Warrants Outstanding, Granted | shares | |
Weighted Average Exercise Price, Granted | |
Weighted Average Fair Value, Forfeited/Cancelled | |
Number of Warrants Outstanding, Forfeited/Cancelled | shares | |
Weighted Average Exercise Price, Forfeited/Cancelled | |
Number of Warrants Outstanding, Exercised | shares | |
Weighted Average Exercise Price, Exercised | |
Weighted Average Fair Value, Exercised | |
Number of Warrants Outstanding, Ending | shares | 70,000 |
Weighted Average Exercise Price, Ending | $ 1.83 |
Weighted Average Fair Value, Ending | $ 5.21 |
Weighted-average Remaining Contractual Life (Years) Outstanding, Ending | 2 years 6 months |
Schedule of Recognized Stock-ba
Schedule of Recognized Stock-based Compensation Expenses (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based Payment Arrangement, Expense | $ 1,410,944 | $ 1,043,134 | $ 3,851,293 | $ 2,167,376 |
Warrant [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based Payment Arrangement, Expense | 303,802 | |||
Share-based Payment Arrangement, Option [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based Payment Arrangement, Expense | 66,247 | 128,344 | 219,033 | 831,542 |
Restricted Stock Units (RSUs) [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based Payment Arrangement, Expense | 1,344,697 | 3,580,360 | ||
Share-based Payment Arrangement [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based Payment Arrangement, Expense | $ 914,790 | $ 51,900 | $ 1,032,032 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details Narrative) - USD ($) | 1 Months Ended | 9 Months Ended | ||
Jan. 31, 2021 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Intrinsic value of options outstanding | $ 8,500,000 | |||
Number of options | 1,111,363 | 1,300,588 | ||
Stock-based compensation | $ 3,851,293 | $ 2,167,376 | ||
Warrant [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Intrinsic value of options outstanding | 553,000 | |||
Stock Options [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Intrinsic value of options execised | 1,300,000 | |||
Number of options | 100,000 | |||
Stock-based compensation | $ 65,000 | |||
Recognized share based compensation | $ 50,000 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Number of Shares | 16,666 | |||
Unrecognized stock-based compensation | $ 119,897 | |||
Unrecognized stock-based compensation recognition period | 8 months 12 days | |||
Stock Options [Member] | Maximum [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Option exercise price | $ 16.49 | |||
Stock Options [Member] | Minimum [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Option exercise price | $ 9.30 | |||
Restricted Stock Units (RSUs) [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Unrecognized stock-based compensation | $ 13,500,000 | |||
Unrecognized stock-based compensation recognition period | 2 years 6 months | |||
Restricted Stock [Member] | Third Parties [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of shares issued for services | 5,548 | |||
Two thousand fifteen long term incentive plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Aggregate number of common shares reserved | 6,000,000 | |||
Number of common shares availalble for issuance | 2,064,933 |
Income Taxes (Details Narrative
Income Taxes (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Income Tax Disclosure [Abstract] | ||||
Income tax expenses | $ 2,100,594 | $ (2,914,781) | $ 6,231,310 | $ (2,914,781) |
Effective income tax rate | 15.50% | 17.60% | ||
Effective income tax u.s. federal statutory rate | 21.00% | |||
Benefit from income taxes | $ (2,100,594) | $ 2,914,781 | $ (6,231,310) | $ 2,914,781 |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) - Exclusive License Agreement[Member] - USD ($) | Jan. 01, 2017 | Sep. 30, 2021 | Sep. 30, 2020 |
Dr Satterfield [Member] | |||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Accrued royalties | $ 700,000 | ||
Dr Satterfield [Member] | Per Month[Member] | |||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Payment for royalties | $ 10,000 | ||
Dr Brent Satterfield [Member] | |||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Due to related party | $ 30,000 | $ 120,000 |
Schedule of Future Minimum Leas
Schedule of Future Minimum Lease Payments (Details) | Sep. 30, 2021USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2021 (remainder) | $ 71,475 |
2022 | 293,595 |
2023 | 303,059 |
2024 | 50,774 |
Total lease payments | $ 718,903 |
Commitments and Contingencies_2
Commitments and Contingencies (Details Narrative) | 3 Months Ended | 6 Months Ended | 9 Months Ended | |||
Sep. 30, 2021USD ($)a | Sep. 30, 2020USD ($) | Jun. 30, 2021USD ($) | Sep. 30, 2021USD ($)a | Sep. 30, 2020USD ($) | Feb. 29, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | ||||||
Lessee, Operating Lease, Term of Contract | 4 years | |||||
Area of Land | a | 13,687 | 13,687 | ||||
Payments for rent | $ 28,825 | |||||
Lease expiration date | Feb. 29, 2024 | |||||
Rent expenses | $ 86,588 | $ 86,588 | $ 259,763 | $ 225,374 |