Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2018 | Aug. 07, 2018 | |
Document and Entity Information | ||
Entity Registrant Name | BioXcel Therapeutics, Inc. | |
Entity Central Index Key | 1,720,893 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2018 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 15,645,545 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q2 |
BALANCE SHEETS
BALANCE SHEETS - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Current assets | ||
Cash and cash equivalents | $ 50,349 | $ 887 |
Prepaid expenses and other current assets | 669 | 3 |
Due from Parent | 70 | |
Total current assets | 51,088 | 890 |
Deferred offering expenses | 461 | |
Equipment, net | 122 | 4 |
Total assets | 51,210 | 1,355 |
Current liabilities | ||
Accounts payable | 889 | 444 |
Accrued expenses | 500 | 1,015 |
Payable to Parent for services | 67 | |
Note payable to Parent | 371 | |
Due to Parent | 440 | |
Total current liabilities | 1,389 | 2,337 |
Total liabilities | 1,389 | 2,337 |
Commitments and contingencies | ||
Stockholders' equity (deficit) | ||
Preferred stock, $0.001 par value, 10,000,000 shares authorized; no shares issued or outstanding | ||
Common stock, $0.001 par value, 50,000,000 shares authorized; 15,645,545 and 9,907,548 shares issued and outstanding as of June 30, 2018 and December 31, 2017, respectively | 16 | 10 |
Additional paid-in-capital | 61,563 | 3,458 |
Accumulated deficit | (11,758) | (4,450) |
Total stockholders' equity (deficit) | 49,821 | (982) |
Total liabilities and stockholders' equity (deficit) | $ 51,210 | $ 1,355 |
BALANCE SHEETS (Parenthetical)
BALANCE SHEETS (Parenthetical) - $ / shares | Jun. 30, 2018 | Mar. 12, 2018 | Dec. 31, 2017 |
BALANCE SHEETS | |||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 | 10,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 | |
Preferred stock, shares outstanding (in shares) | 0 | 0 | |
Common shares, par value (in dollars per share) | $ 0.001 | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 50,000,000 | 50,000,000 | 50,000,000 |
Common stock, shares issued (in shares) | 15,645,545 | 9,907,548 | |
Common stock, shares outstanding (in shares) | 15,645,545 | 9,907,548 |
STATEMENTS OF OPERATIONS
STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
STATEMENTS OF OPERATIONS | ||||
Revenues | $ 0 | $ 0 | $ 0 | $ 0 |
Operating costs and expenses | ||||
Research and development | 1,781 | 324 | 4,719 | 645 |
General and administrative | 1,463 | 241 | 2,811 | 449 |
Total operating expenses | 3,244 | 565 | 7,530 | 1,094 |
Loss from operations | (3,244) | (565) | (7,530) | (1,094) |
Other income | ||||
Dividend and interest income, net | 218 | 222 | ||
Net loss | $ (3,026) | $ (565) | $ (7,308) | $ (1,094) |
Net loss per share attributable to common stockholders/ Parent basic and diluted (in dollars per share) | $ (0.19) | $ (0.06) | $ (0.54) | $ (0.12) |
Weighted average shares outstanding - basic and diluted (in shares) | 15,645,545 | 9,480,000 | 13,507,770 | 9,480,000 |
STATEMENTS OF CASH FLOWS
STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net loss | $ (7,308) | $ (1,094) |
Reconciliation of net loss to net cash used in operating activities | ||
Depreciation and amortization | 2 | |
Stock-based compensation expense | 2,060 | 200 |
Changes in operating assets and liabilities: | ||
Prepaid expenses | (666) | 2 |
Accounts payable and accrued expenses | (70) | 116 |
Net cash used in operating activities | (5,982) | (776) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Purchase of equipment | (120) | |
Net cash used in investing activities | (120) | |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from issuance of common stock, net | 56,512 | |
Net Parent Investment | 214 | |
Payable to Parent for services | (67) | |
Due to Parent | (510) | 562 |
Note Payable - Parent | (371) | 285 |
Net cash provided by financing activities | 55,564 | 1,061 |
Net increase in cash and cash equivalents | 49,462 | 285 |
Cash and cash equivalents, beginning of the period | 887 | 0 |
Cash and cash equivalents, end of the period | 50,349 | $ 285 |
Supplemental cash flow information: | ||
Interest paid | 1 | |
Supplemental disclosure of non-cash Financing Activity: | ||
Deferred issuance costs reclassified to additional paid-in-capital upon completion of initial public offering | $ 461 |
Organization and Principal Acti
Organization and Principal Activities | 6 Months Ended |
Jun. 30, 2018 | |
Organization and Principal Activities | |
Organization and Principal Activities | Note 1. Organization and Principal Activities BioXcel Therapeutics, Inc. (the "Company" or "BTI") is a clinical stage biopharmaceutical company focused on novel artificial intelligence-based drug development to identify the next wave of medicines across neuroscience and immuno-oncology. The Company’s drug re-innovation approach leverages existing approved drugs and/or clinically validated product candidates together with big data and proprietary machine learning algorithms to identify new therapeutic indices. The Company is a majority-owned subsidiary of BioXcel Corporation ("BioXcel" or "Parent") and was incorporated under the laws of the State of Delaware on March 29, 2017. The Company’s principal office is in New Haven, Connecticut. Unless otherwise indicated or the context requires otherwise, references in this report to "we," "our," "us" and similar expressions refer to BioXcel Therapeutics, Inc. The unaudited financial information for the three and six months ended June 30, 2018 and 2017 is presented on the same basis as the financial statements included in the Company's registration statement on Form S-1 relating to its initial public offering of its common shares. The Company’s primary activities have been the development of a clinical plan and pre-clinical research and development of two advanced programs: BXCL501, a sublingual thin film formulation of dexmedetomidine designed for acute treatment of agitation resulting from neurological and psychiatric disorders, and BXCL701, an immuno-oncology agent designed for treatment of a rare form of prostate cancer and for treatment of pancreatic cancer. These two programs and two emerging programs BXCL502 and BXCL702 (together, "the BTI Business") have been contributed to the Company from the Parent pursuant to a contribution agreement. |
Initial Public Offering
Initial Public Offering | 6 Months Ended |
Jun. 30, 2018 | |
Initial Public Offering | |
Initial Public Offering | Note 2. Initial Public Offering On March 7, 2018, the Company’s registration statement on Form S‑1 relating to its initial public offering of its common shares (the “IPO”) was declared effective by the Securities and Exchange Commission (“SEC”). The IPO closed on March 12, 2018, and the Company issued and sold 5,454,545 common shares at a public offering price of $11.00 per share. Gross proceeds totaled $60,000 and net proceeds totaled $54,102 after deducting underwriting discounts and commissions of $4,200 and other offering expenses of approximately $1,698. In connection with and effective upon the completion of its IPO, the Company effectuated a 237 to one stock split. Accordingly, all share and per share amounts for all periods presented in the accompanying financial statements have been adjusted retroactively, where applicable, to reflect the stock split. Also, in connection with the completion of its IPO, the Company amended its articles of incorporation to authorize the issuance of up to 50,000,000 shares of common stock with a par value of $.001 each and 10,000,000 shares of preferred stock with a par value of $.001 par value each. |
Basis of Presentation and Liqui
Basis of Presentation and Liquidity | 6 Months Ended |
Jun. 30, 2018 | |
Basis of Presentation and Liquidity | |
Basis of Presentation and Liquidity | Note 3. Basis of Presentation and Liquidity Basis of Presentation The financial statements of the Company for the period through June 30, 2017 are derived by carving out the historical results of operations and historical cost basis of the assets and liabilities associated with the BTI Business that have been contributed to the Company by BioXcel, from the financial statements of BioXcel. These results reflect amounts specifically attributable to the BTI Business under a contribution agreement, effective June 30, 2017, as amended and restated on November 7, 2017, or the Contribution Agreement, for the period from January 1, 2015 until June 30, 2017. The Company has also entered into a separation and shared services agreement with BioXcel that took effect on June 30, 2017, as amended and restated on November 7, 2017, or the Services Agreement, pursuant to which BioXcel provides the Company with certain general and administrative and development support services. However, consistent with accounting regulations, it has been assumed that the Company was a separate business since January 1, 2015, and accordingly the assets, liabilities and expenses relating to the BTI Business have been separated from the Parent in the financial statements for periods prior to and post incorporation through June 30, 2017. The financial statements for the three and six month periods ended June 30, 2017, include reasonable allocations for assets and liabilities and expenses attributable to the BTI Business. For the three and six month periods ended June 30, 2018, the results are on a stand-alone entity basis. All assets and liabilities contributed by BioXcel to the Company have been recorded at historical book value. The balance sheet information as of December 31, 2017, was derived from the audited financial statements which include the accounts of BioXcel Therapeutics Inc. but does not include all disclosures required by accounting principles generally accepted in the United States (“GAAP”). The unaudited financial information should be read in conjunction with the financial statements and notes included in the Company’s S-1. Liquidity and Going Concern In accordance with Accounting Standards Update (“ASU”) 2014‑15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern (Subtopic 205‑40), management must evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that the financial statements are issued. Management believes that as a result of the proceeds received in connection with its IPO that it has sufficient liquidity to meet its obligations as they come due for at least eighteen months. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2018 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | Note 4. Summary of Significant Accounting Policies Use of Estimates The Company’s financial statements are prepared in accordance with GAAP. The preparation of BioXcel’s financial statements requires the Company to make estimates and assumptions that impact the reported amounts of assets, liabilities and expenses in its financial statements and the accompanying notes. The most significant estimates in the financial statements relate to the fair value of equity awards and valuation allowance related to the Company’s deferred tax assets and liabilities. For the six months ended June 30, 2018 and 2017, the most significant estimates include the valuation of the Parent’s common stock, allocation of expenses, assets and liabilities from the Parent. Although these estimates are based on the Company’s knowledge of current events and actions it may undertake in the future, actual results may ultimately materially differ from these estimates. Unaudited Interim Financial Information The accompanying unaudited financial statements do not include all of the information and footnotes required by GAAP. The accompanying year-end balance sheet was derived from audited financial statements but does not include all disclosures required by GAAP. The unaudited interim financial statements have been prepared on the same basis as the audited annual financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary for the fair statement of the Company’s financial position as of June 30, 2018, and the results of its operations for the three and six months ended June 30, 2018 and 2017 and its cash flows for the three and six months ended June 30, 2018 and 2017, respectively. The results for the six months ended June 30, 2018 are not necessarily indicative of results to be expected for the year ending December 31, 2018, any other interim periods or any future year or period. Cash and Cash Equivalents The Company considers all highly liquid investments with an original maturity of three months or less at the date of purchase to be cash equivalents. As of June 30, 2018, cash equivalents were comprised of money market funds. Deferred Offering Costs The Company capitalized certain legal, professional accounting and other third-party fees that were directly associated with in-process equity financings as deferred offering costs until the equity financing was consummated. After consummation of an equity financing, these costs were recorded in shareholders’ equity (deficit) as a reduction of proceeds generated as a result of the offering. As of December 31, 2017, the Company recorded deferred offering costs relating to its IPO of $461. The Company’s IPO was completed in March 2018, and these costs, as well as additional IPO costs including commissions of $4,200 and an additional $1,237 of other expenses incurred in 2018, were recorded as a reduction to shareholders’ equity. Equipment Equipment consists of computers and related equipment that are stated at cost and depreciated using the straight-line method over estimated useful life of 5 years. The Company follows the guidance provided by FASB ASC Topic 360‑10, Property, Plant, and Equipment . Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to undiscounted future net cash flows expected to be generated. Impairment charges are recognized at the amount by which the carrying amount of an asset exceeds the fair value of the asset. Assets to be disposed of are reported at the lower of the carrying amount or the fair value less costs to sell. Since its inception, the Company has not recognized any impairment or disposition of long lived assets. Stock-Based Compensation The Company accounts for stock-based compensation in accordance with ASC 718, " Compensation—Stock Compensation, " which requires the measurement and recognition of compensation expense based on estimated fair market values for all share-based awards made to employees and directors, including stock options. The Company’s stock-based compensation plan was adopted and became effective in August 2017. Prior to the Company adopting its stock-based compensation plan the Parent granted stock options to its employees. As a result, related stock-based compensation expense has been allocated to the Company over the required service period over which these BioXcel stock option awards vest in the same manner salary costs of employees have been allocated to the BTI Business in the carve-out process. Both BioXcel and the Company’s stock option awards are valued at fair value on the date of grant and that fair value is recognized over the requisite service period. The estimated fair value of stock option awards was determined using the Black-Scholes option pricing model on the date of grant. Significant judgment and estimates were used to estimate the fair value of these awards, as they were not publicly traded. Stock awards granted by the Company subsequent to the IPO are valued using market prices at the date of grant. Stock-based awards to non-employees are re-measured at fair value each financial reporting date until performance is complete. ASC 718 requires companies to estimate the fair value of share-based awards on the date of grant using an option-pricing model. The Black-Scholes option-pricing model was used as its method of determining fair value. This model is affected by the Company’s stock price as well as assumptions regarding a number of subjective variables. These subjective variables include, but are not limited to, the expected stock price volatility over the term of the awards, and actual and projected employee stock option exercise behaviors. The value of the award is recognized as an expense in the statement of operations over the requisite service period. The periodic expense is then determined based on the valuation of the options. The Company adopted FASB ASU 2016-09 as of January 1, 2018 and has elected to account for forfeitures as they occur, by reversing compensation cost when the award is forfeited. Research and Development Costs Research and development expenses include wages, benefits, facilities, supplies, external services, clinical study and manufacturing costs and other expenses that are directly related to its research and development activities. At the end of the reporting period, the Company compares payments made to third party service providers to the estimated progress toward completion of the research or development objectives. Such estimates are subject to change as additional information becomes available. Depending on the timing of payments to the service providers and the progress that the Company estimates has been made as a result of the service provided, the Company may record net prepaid or accrued expense relating to these costs. The Company expenses research and development costs as incurred. Patent Costs Costs related to filing and pursuing patent applications are recorded as general and administrative expense and expensed as incurred since recoverability of such expenditures is uncertain. Fair Value Measurements ASC 820 " Fair Value Measurements " defines fair value, establishes a framework for measuring fair value in GAAP and expands disclosures about fair value measurements. ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC 820 establishes a fair value hierarchy that distinguishes between (1) market participant assumptions developed based on market data obtained from independent sources (observable inputs) and (2) an entity’s own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs). The fair value hierarchy consists of three broad levels, which gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy under ASC 820 are described below: · Level 1—Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs. · Level 2—Directly or indirectly observable inputs as of the reporting date through correlation with market data, including quoted prices for similar assets and liabilities in active markets and quoted prices in markets that are not active. Level 2 also includes assets and liabilities that are valued using models or other pricing methodologies that do not require significant judgment since the input assumptions used in the models, such as interest rates and volatility factors, are corroborated by readily observable data from actively quoted markets for substantially the full term of the financial instrument. · Level 3—Unobservable inputs that are supported by little or no market activity and reflect the use of significant management judgment. These values are generally determined using pricing models for which the assumptions utilize management’s estimates of market participant assumptions. In determining fair value, the Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible, as well as considering counterparty credit risk in its assessment of fair value. The carrying amounts of cash, accounts payable and accrued expenses approximate fair value due to the short-term nature of these instruments. Net Loss per Share The Company computes basic net loss per share by dividing net loss available to common stockholders by the weighted average number of common shares outstanding for the period and excludes the effects of any potentially dilutive securities. Diluted earnings per share, if presented, would include the dilution that would occur upon the exercise or conversion of all potentially dilutive securities into common stock using the "treasury stock" and/or "if converted" methods as applicable. The potential dilutive securities included outstanding options (for both employees and non-employees) for the three and six months ended June 30, 2018 and 2017. Such securities have not been included in the loss per share calculation since their impact would be anti-dilutive. There were 2,542,644 and 2,446,146 shares of options that were excluded from the calculation of the loss per share for the three and six months ended June 30, 2018, respectively. The Company was incorporated on March 29, 2017 and net loss per common share for the three and six months ending June 30, 2017, was calculated as if the shares to the Parent were issued at formation. Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board, or FASB, issued ASU 2014‑09 Revenue from Contracts with Customers. Under this guidance, an entity will recognize revenue when it transfers promised goods or services to customers in an amount that reflects what the entity expects to receive in exchange for the goods or services. This new guidance also requires more detailed disclosures to enable users of the financial statements to understand the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. The Company adopted this guidance beginning on January 1, 2018. The guidance allows the selection of one of two methods of adoption, either the full retrospective approach, meaning the guidance would be applied to all periods presented, or modified retrospective approach, meaning the cumulative effect of applying the guidance would be recognized as an adjustment to opening accumulated deficit balance. Since the Company has no revenues to date, the Company does not believe the adoption of ASU‑214‑09 will have a material impact on its financial statements. In February 2016, the FASB issued ASU 2016‑02 Lease Accounting Topic 842 . This ASU requires the Company to record all leases longer than one year on its balance sheet. Under the new guidance, when the Company records leases on its balance sheet it will record a liability with a value equal to the present value of payments it will make over the life of the lease and an asset representing the underlying leased asset. The new accounting guidance requires the Company to determine if its leases are operating or financing leases, similar to current accounting guidance. The Company will record expense for operating type leases on a straight-line basis as an operating expense and it will record expense for finance type leases as interest expense. The new lease standard is effective for annual and interim periods beginning after December 15, 2018, with early adoption permitted. The Company must adopt the new standard on a modified retrospective basis, which requires it to reflect its leases on its balance sheet for the earliest comparative period presented. The Company is currently assessing the timing of adoption as well as the effects it will have on its financial statements and disclosures. The SEC staff issued Staff Accounting Bulletin ("SAB") 118, which provides guidance on accounting for the tax effects of the U.S. tax reform announced on December 22, 2017 by the U.S. Government commonly referred to as the Tax Cuts and Jobs Act. SAB 118 provides a measurement period that should not extend beyond one year from the U.S. tax reform enactment date for companies to complete the accounting under Accounting Standards Codification ("ASC") 740. In accordance with SAB 118, a company must reflect the income tax effects of those aspects of the U.S. tax reform for which the accounting under ASC 740 is complete. Specifically, the Company revalued its U.S. deferred tax assets and liabilities due to the federal income tax rate reduction from 35 percent to 21 percent. Since the Company has provided a full valuation allowance against its deferred tax assets, the revaluation of the deferred tax assets did not have a material impact on any period presented. In June 2018 the FASB issued ASU 2018-07 Compensation – Stock Compensation Topic 718. This ASU was issued as part of the FASB’s simplification initiative. The amendments in this Update expand the scope of Topic 718 to include sharebased payment transactions for acquiring goods and services from nonemployees. An entity should apply the requirements of Topic 718 to nonemployee awards except for specific guidance on inputs to an option pricing model and the attribution of cost (that is, the period of time over which share-based payment awards vest and the pattern of cost recognition over that period). The amendments specify that Topic 718 applies to all share-based payment transactions in which a grantor acquires goods or services to be used or consumed in a grantor’s own operations by issuing share-based payment awards. The amendments also clarify that Topic 718 does not apply to share-based payments used to effectively provide (1) financing to the issuer or (2) awards granted in conjunction with selling goods or services to customers as part of a contract accounted for under Topic 606, Revenue from Contracts with Customers. The Company is currently assessing the timing of adoption as well as the effects it will have on its financial statements and disclosures. |
Transactions with BioXcel
Transactions with BioXcel | 6 Months Ended |
Jun. 30, 2018 | |
Transactions with BioXcel | |
Transactions with BioXcel | Note 5. Transactions with BioXcel The Company has entered into an asset contribution agreement, effective June 30, 2017, with BioXcel, as amended and restated on November 7, 2017, or the Contribution Agreement, pursuant to which BioXcel agreed to contribute BioXcel’s rights, title and interest in BXCL501, BXCL701, BXCL502 and BXCL702, and all of the assets and liabilities associated in consideration for (i) 9,480,000 shares of our common stock, (ii) $1,000 upon completion of an initial public offering, (iii) $500 upon the later of the 12 month anniversary of an initial public offering and the first dosing of a patient in the bridging bioavailability/ bioequivalence study for the BXCL501 program, (iv) $500 upon the later of the 12 month anniversary of an initial public offering and the first dosing of a patient in the Phase 2 PoC open label monotherapy or combination trial with Keytruda for the BXCL701 program and (v) a one-time payment of $5,000 within 60 days after the achievement of $50,000 in cumulative net sales of any product or combination of products resulting from the development and commercialization of any one of the Candidates or a product derived therefrom. With the completion of the Company’s IPO in March 2018, $1 million was charged to Research and Development costs and included in accounts payable in connection with (ii) above and was paid on April 5, 2018. We entered into a separation and shared services agreement with BioXcel that took effect on June 30, 2017, as amended and restated on November 7, 2017, or the Services Agreement, pursuant to which BioXcel will allow us to continue to use the office space, equipment, services and leased employees based on the agreed upon terms and conditions for a payment of defined monthly and/or hourly fees. The parties have agreed that the services and office space provided under the Services Agreement shall decrease over time until the 12-month anniversary of the date of the Services Agreement. The office space and equipment portion of the Services Agreement ended effectively on April 30, 2018 when the Company moved to new office space to accommodate additional personnel that was hired during the three months ended June 30, 2018. Services to be provided by BioXcel through its subsidiary in India, were originally expected to decrease through June 30, 2019 provided such dates may be extended upon mutual agreement between the parties. The parties are currently discussing extending the term of these services provided however no definitive agreement has been agreed upon as of the date hereof. There can be no assurance that the parties will agree to any extension to the Services Agreement in the future. On or before December 31, 2019, we shall have the option to enter into a collaborative services agreement with BioXcel pursuant to which BioXcel shall perform product identification and related services for us utilizing EvolverAI. We have agreed that this agreement will be negotiated in good faith and that such agreement will incorporate reasonable market-based terms, including consideration for BioXcel reflecting a low, single-digit royalty on net sales and reasonable development and commercialization milestone payments, provided that (i) development milestones shall not exceed $10 million in the aggregate and not be payable prior to proof of concept in humans and (ii) commercialization milestones shall be based on reaching annual net sales levels, be limited to 3% of the applicable net sales level, and not exceed $30 million in the aggregate. BioXcel shall continue to make such product identification and related services available to us for at least five years from June 30, 2017. The parties are currently discussing extending the product identification and related services that BioXcel would provide however no definitive agreement has been agreed upon as of the date hereof. There can be no assurance that the parties will agree to any extension to the collaborative services agreement in the future. In connection with the Services Agreement, BioXcel had agreed to provide the Company a line of credit, which was capped at $1,000, or the Total Funding Amount, pursuant to the terms of a grid note, or the Grid Note. The Grid Note was payable upon the earlier of (i) the completion of an initial public offering and (ii) December 31, 2018, together with interest on the unpaid balance of each advance made under the Grid Note, which would accrue at a rate per annum equal to the applicable federal rate for short-term loans as of the date hereof, in each case calculated based on a 365‑day year and actual days elapsed. As of December 31, 2017, the Company had drawn down $371 under the Grid Note. All amounts due to BioXcel under the line of credit, the Grid Note, and for expenses paid on the Company’s behalf were paid following the completion of the Company’s IPO on March 20, 2018. |
Equipment
Equipment | 6 Months Ended |
Jun. 30, 2018 | |
Equipment | |
Equipment | Note 6. Equipment June 30, December 31, 2018 2017 Unaudited Computers and related equipment $ 125 $ 5 Accumulated depreciation $ (3) $ (1) $ 122 $ 4 |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2018 | |
Commitments and Contingencies | |
Commitments and Contingencies | Note 7. Commitments and Contingencies The Company is required to pay to BioXcel the amount of $5,000 within 60 days after the achievement of $50,000 in cumulative net sales of any product or combination of products resulting from the development and commercialization of any one of the candidates BXCL501, BXCL701, BXCL502, and BXCL702 or a product derived therefrom. The Company is also required to pay to BioXcel the amount of $2,000 in connection with the IPO, (x) the first $1,000 was charged to Research and Development expenses during the three months ended March 31, 2018 and paid to BioXcel on April 5, 2018 and (y) the second $1,000, (i) $500 of which is payable upon the later of the 12 month anniversary of an offering and the first dosing of a patient in the bridging bioavailability/bioequivalence study for the BXCL501 program and (ii) $500 of which is payable upon the later of the 12 month anniversary of an offering and the first dosing of a patient in the Phase 2 PoC open label monotherapy or combination trial with Keytruda for the BXCL701 program. |
Accrued Expenses
Accrued Expenses | 6 Months Ended |
Jun. 30, 2018 | |
Accrued Expenses | |
Accrued Expenses | Note 8. Accrued Expenses Accrued expenses consist of the following: June 30, 2018 December 31, 2017 (Unaudited) Accrued salaries, benefits and travel related costs $ 203 $ 79 Professional and consultant fees 95 120 Legal expenses 104 413 Drugs and clinical trial expenses 98 403 $ 500 $ 1,015 |
Stockholders' Equity (Deficit)
Stockholders' Equity (Deficit) | 6 Months Ended |
Jun. 30, 2018 | |
Stockholders' Equity (Deficit) | |
Stockholders' Equity (Deficit) | Note 9. Stockholders’ Equity (Deficit) Authorized Capital The Company is authorized to issue up to 10,000,000 preferred shares with a par value of $0.001 per share. No preferred shares are issued and outstanding. The Company is authorized to issue up to 50,000,000 shares of common stock with a par value of $0.001 per share. The Company had 15,645,545 shares of common stock outstanding as of June 30, 2018. Description of Common Stock Each share of common stock has the right to one vote. The holders of common stock are entitled to dividends when funds are legally available and when declared by the board of directors. Common Stock Issuances On March 7, 2018, the Company’s registration statement on Form S-1 relating to the Company’s IPO was declared effective by the SEC. The IPO closed on March 12, 2018, and the Company issued and sold 5,454,545 shares of common stock at a public offering price of $11.00 per share, for gross proceeds of $60,000 and net proceeds of $54,102 after deducting underwriting discounts and commissions of $4,200 and other offering expenses of $1,698. In January and February 2018, the Company issued 283,452 shares of common stock with an issuance price of $6.88 per share for gross and net proceeds of $1,950. In October 2017, the Company sold 271,839 shares of common stock with an issuance price of $4.82 per share with gross and net proceeds of $1,311. In September 2017, the Company sold 155,709 shares of common stock with an issuance price of $4.82 per share with gross and net proceeds of $751. |
Stock-Based Compensation
Stock-Based Compensation | 6 Months Ended |
Jun. 30, 2018 | |
Stock-Based Compensation | |
Stock-Based Compensation | Note 10. Stock-Based Compensation Stock Options The Company’s 2017 Stock Incentive Plan (the "2017 Stock Plan") became effective in August 2017 and will expire in August 2027. Under the 2017 Stock Plan, the Company may grant incentive stock options, non-statutory stock options, restricted stock awards and other stock-based awards. As of June 30, 2018 there were 3,462,570 shares of the Company’s common stock authorized for issuance under the 2017 Stock Plan. Options granted under the 2017 Stock Plan have a term of ten years with vesting term determined by the board of directors, which is generally four years. The fair value of options granted during the six months ended June 30, 2018 was estimated using the Black-Scholes option-pricing model with the following assumptions. Employees (Unaudited) For the Six Months Ended June 30, 2018 Exercise price per share $ - $ Expected stock price volatility % - % Risk-free rate of interest % - % Fair value of grants per share $ - $ Expected Term (years) - Non-Employees (Unaudited) For the Six Months Ended June 30, 2018 Exercise price per share $ - $ Expected stock price volatility % - % Risk-free rate of interest % - % Fair value of grants per share $ - $ Expected Term (years) - Since the Company recently completed its IPO, it does not have a history of market prices of its common stock and, as such, volatility was estimated using historical volatilities of similar public companies. The expected term of the employee awards is estimated based on the simplified method, which calculates the expected term based upon the midpoint of the term of the award and the vesting period. The Company uses the simplified method because it does not have sufficient option exercise data to provide a reasonable basis upon which to estimate the expected term. The expected term of non-employee awards represents the awards contractual term. The expected dividend yield is 0% as the Company has no history of paying dividends nor does management expect to pay dividends over the contractual terms of these options. The risk-free interest rates are based on the United States Treasury yield curve in effect at the time of grant, with maturities approximating the expected term of the stock options. The following table summarizes information about stock option activity during the period the Plan was in effect (in thousands, except share and per share data): Employee Options Weighted Average Number Weighted Average Total Remaining of Exercise Intrinsic Contractual Shares Price per Share Value Life (in years) Outstanding as of January 1, 2018 1,813,524 $ 0.65 $ 13,894,762 9.7 Employee options granted 143,148 $ 11.00 $ — 10.0 Outstanding as of March 31, 2018 1,956,672 $ 1.41 $ 17,395,705 9.4 Employee options granted 100,000 $ 10.06 $ 16,100 9.9 Options reclassified from Non-employee 154,178 $ 2.45 $ 1,093,696 9.3 Outstanding as of June 30, 2018 2,210,850 $ 1.87 $ 16,619,436 9.2 Options vested and exercisable as of June 30, 2018 1,370,283 0.41 $ 12,038,174 9.2 Non-employee Options Weighted Average Number Weighted Average Total Remaining of Exercise Intrinsic Contractual Shares Price per Share Value Life (in years) Outstanding as of January 1, 2018 496,515 $ 0.41 $ 3,922,238 9.6 Non-employee options granted 68,256 $ 11.00 $ — 10.0 Non-employee options forfeited (6,162) $ 0.41 Outstanding as of March 31, 2018 558,609 $ 1.70 $ 4,820,170 9.5 Non-employee options forfeited (154,178) $ 2.45 Outstanding as of June 30, 2018 404,431 $ 1.42 $ 3,216,507 9.2 Options vested and exercisable as of June 30, 2018 43,717 0.71 $ 372,898 9.2 The Company granted 311,404 options to purchase shares of common stock during the six months ended June 30, 2018. No options were exercised during the six months ended June 30, 2018. There were 847,289 shares available for grant as of June 30, 2018. The Company recognized stock-based compensation expense of $666 and $1,861 for the three and six months ended June 30, 2018. There was no corresponding charge for the six months ending June 30, 2017 as the plan did not exist. The total grant-date fair value of options was $3,286 and $572 for employees and non-employees, respectively, for the six months ended June 30, 2018. Unrecognized compensation expense related to unvested awards as of June 30, 2018 was $3,176 for non-employees and $1,804 for employees and will be recognized over the remaining vesting periods of the underlying awards. The weighted-average period over which such compensation is expected to be recognized is 1.5 years for non-employees and 1.8 years for employees. BioXcel Charges BioXcel has granted stock options to its employees under its own Equity Incentive Plan ("BioXcel Plan"). Stock-based compensation expense from the BioXcel Plan is allocated to the Company over the period over which those stock option awards vest and are based the on the percentage of time spent on Company activities compared to BioXcel activities, which is the same basis used for allocation of salary costs. The BioXcel stock option awards are valued at fair value on the date of grant and that fair value is recognized over the requisite service period. The estimated fair value of these BioXcel stock option awards was determined using the Black Scholes option pricing model on the date of grant. Significant judgment and estimates were used to estimate the fair value of these awards, as they are not publicly traded. Share based compensation expense recognized by the Company in its statements of operations related to BioXcel equity awards totaled approximately $76 and $93 for the three months ended June 30, 2018 and 2017, respectively and $199 and $200 for the six months ended June 30, 2018 and 2017, respectively. Total share based compensation charges were approximately $742 and $93 for the three months ended June 30, 2018 and 2017, respectively and $2,060 and $200 for the six months ended June 30, 2018 and 2017, respectively. |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2018 | |
Income Taxes | |
Income Taxes | Note 11. Income Taxes Deferred income tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial reporting and tax bases of assets and liabilities and are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. A valuation allowance is provided for the amount of deferred tax assets that, based on available evidence, are not expected to be realized. As a result of the Company’s cumulative losses, management has concluded that a full valuation allowance against the Company’s net deferred tax assets is appropriate. No income tax liabilities existed as of June 30, 2018 and December 31, 2017 due to the Company’s continuing operating losses. |
Leases
Leases | 6 Months Ended |
Jun. 30, 2018 | |
Leases | |
Leases | Note 12. Leases The Company entered into a “Swing Space” agreement on June 21, 2018 (the “Commencement Date”) to lease approximately 5,300 square feet of office space on the 5 th floor (the “5 th Floor Lease”) and is currently negotiating an agreement to lease approximately 11,000 square feet of space (the “12 th Floor Lease”) of the building located at 555 Long Wharf Drive, New Haven, Connecticut. The term of the 5 th Floor Lease is through the earlier of the date the Company conducts business in the 12 th Floor space, (the “expiration date”) or April 30, 2019 (“termination date”). No base rent is payable during this period, however, the Company is obligated to pay electricity in the amount of $1 per month. Should the 12 th floor lease not be executed within sixty days of the commencement date, a base rent of $8 per month will be charged following the expiration date. Should the Company remain in possession of the 5 th floor lease beyond the termination date, occupancy will be on a month to month basis in the amount of $12 per month. |
Summary of Significant Accoun18
Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2018 | |
Summary of Significant Accounting Policies | |
Use of Estimates | Use of Estimates The Company’s financial statements are prepared in accordance with GAAP. The preparation of BioXcel’s financial statements requires the Company to make estimates and assumptions that impact the reported amounts of assets, liabilities and expenses in its financial statements and the accompanying notes. The most significant estimates in the financial statements relate to the fair value of equity awards and valuation allowance related to the Company’s deferred tax assets and liabilities. For the six months ended June 30, 2018 and 2017, the most significant estimates include the valuation of the Parent’s common stock, allocation of expenses, assets and liabilities from the Parent. Although these estimates are based on the Company’s knowledge of current events and actions it may undertake in the future, actual results may ultimately materially differ from these estimates. |
Unaudited Interim Financial Information | Unaudited Interim Financial Information The accompanying unaudited financial statements do not include all of the information and footnotes required by GAAP. The accompanying year-end balance sheet was derived from audited financial statements but does not include all disclosures required by GAAP. The unaudited interim financial statements have been prepared on the same basis as the audited annual financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary for the fair statement of the Company’s financial position as of June 30, 2018, and the results of its operations for the three and six months ended June 30, 2018 and 2017 and its cash flows for the three and six months ended June 30, 2018 and 2017, respectively. The results for the six months ended June 30, 2018 are not necessarily indicative of results to be expected for the year ending December 31, 2018, any other interim periods or any future year or period. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid investments with an original maturity of three months or less at the date of purchase to be cash equivalents. As of June 30, 2018, cash equivalents were comprised of money market funds. |
Deferred Offering Costs | Deferred Offering Costs The Company capitalized certain legal, professional accounting and other third-party fees that were directly associated with in-process equity financings as deferred offering costs until the equity financing was consummated. After consummation of an equity financing, these costs were recorded in shareholders’ equity (deficit) as a reduction of proceeds generated as a result of the offering. As of December 31, 2017, the Company recorded deferred offering costs relating to its IPO of $461. The Company’s IPO was completed in March 2018, and these costs, as well as additional IPO costs including commissions of $4,200 and an additional $1,237 of other expenses incurred in 2018, were recorded as a reduction to shareholders’ equity. |
Equipment | Equipment Equipment consists of computers and related equipment that are stated at cost and depreciated using the straight-line method over estimated useful life of 5 years. The Company follows the guidance provided by FASB ASC Topic 360‑10, Property, Plant, and Equipment . Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to undiscounted future net cash flows expected to be generated. Impairment charges are recognized at the amount by which the carrying amount of an asset exceeds the fair value of the asset. Assets to be disposed of are reported at the lower of the carrying amount or the fair value less costs to sell. Since its inception, the Company has not recognized any impairment or disposition of long lived assets. |
Stock-Based Compensation | Stock-Based Compensation The Company accounts for stock-based compensation in accordance with ASC 718, " Compensation—Stock Compensation, " which requires the measurement and recognition of compensation expense based on estimated fair market values for all share-based awards made to employees and directors, including stock options. The Company’s stock-based compensation plan was adopted and became effective in August 2017. Prior to the Company adopting its stock-based compensation plan the Parent granted stock options to its employees. As a result, related stock-based compensation expense has been allocated to the Company over the required service period over which these BioXcel stock option awards vest in the same manner salary costs of employees have been allocated to the BTI Business in the carve-out process. Both BioXcel and the Company’s stock option awards are valued at fair value on the date of grant and that fair value is recognized over the requisite service period. The estimated fair value of stock option awards was determined using the Black-Scholes option pricing model on the date of grant. Significant judgment and estimates were used to estimate the fair value of these awards, as they were not publicly traded. Stock awards granted by the Company subsequent to the IPO are valued using market prices at the date of grant. Stock-based awards to non-employees are re-measured at fair value each financial reporting date until performance is complete. ASC 718 requires companies to estimate the fair value of share-based awards on the date of grant using an option-pricing model. The Black-Scholes option-pricing model was used as its method of determining fair value. This model is affected by the Company’s stock price as well as assumptions regarding a number of subjective variables. These subjective variables include, but are not limited to, the expected stock price volatility over the term of the awards, and actual and projected employee stock option exercise behaviors. The value of the award is recognized as an expense in the statement of operations over the requisite service period. The periodic expense is then determined based on the valuation of the options. The Company adopted FASB ASU 2016-09 as of January 1, 2018 and has elected to account for forfeitures as they occur, by reversing compensation cost when the award is forfeited. |
Research and Development Costs | Research and Development Costs Research and development expenses include wages, benefits, facilities, supplies, external services, clinical study and manufacturing costs and other expenses that are directly related to its research and development activities. At the end of the reporting period, the Company compares payments made to third party service providers to the estimated progress toward completion of the research or development objectives. Such estimates are subject to change as additional information becomes available. Depending on the timing of payments to the service providers and the progress that the Company estimates has been made as a result of the service provided, the Company may record net prepaid or accrued expense relating to these costs. The Company expenses research and development costs as incurred. |
Patent Costs | Patent Costs Costs related to filing and pursuing patent applications are recorded as general and administrative expense and expensed as incurred since recoverability of such expenditures is uncertain. |
Fair Value Measurements | Fair Value Measurements ASC 820 " Fair Value Measurements " defines fair value, establishes a framework for measuring fair value in GAAP and expands disclosures about fair value measurements. ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC 820 establishes a fair value hierarchy that distinguishes between (1) market participant assumptions developed based on market data obtained from independent sources (observable inputs) and (2) an entity’s own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs). The fair value hierarchy consists of three broad levels, which gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy under ASC 820 are described below: · Level 1—Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs. · Level 2—Directly or indirectly observable inputs as of the reporting date through correlation with market data, including quoted prices for similar assets and liabilities in active markets and quoted prices in markets that are not active. Level 2 also includes assets and liabilities that are valued using models or other pricing methodologies that do not require significant judgment since the input assumptions used in the models, such as interest rates and volatility factors, are corroborated by readily observable data from actively quoted markets for substantially the full term of the financial instrument. · Level 3—Unobservable inputs that are supported by little or no market activity and reflect the use of significant management judgment. These values are generally determined using pricing models for which the assumptions utilize management’s estimates of market participant assumptions. In determining fair value, the Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible, as well as considering counterparty credit risk in its assessment of fair value. The carrying amounts of cash, accounts payable and accrued expenses approximate fair value due to the short-term nature of these instruments. |
Net Loss per Share | Net Loss per Share The Company computes basic net loss per share by dividing net loss available to common stockholders by the weighted average number of common shares outstanding for the period and excludes the effects of any potentially dilutive securities. Diluted earnings per share, if presented, would include the dilution that would occur upon the exercise or conversion of all potentially dilutive securities into common stock using the "treasury stock" and/or "if converted" methods as applicable. The potential dilutive securities included outstanding options (for both employees and non-employees) for the three and six months ended June 30, 2018 and 2017. Such securities have not been included in the loss per share calculation since their impact would be anti-dilutive. There were 2,542,644 and 2,446,146 shares of options that were excluded from the calculation of the loss per share for the three and six months ended June 30, 2018, respectively. The Company was incorporated on March 29, 2017 and net loss per common share for the three and six months ending June 30, 2017, was calculated as if the shares to the Parent were issued at formation. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board, or FASB, issued ASU 2014‑09 Revenue from Contracts with Customers. Under this guidance, an entity will recognize revenue when it transfers promised goods or services to customers in an amount that reflects what the entity expects to receive in exchange for the goods or services. This new guidance also requires more detailed disclosures to enable users of the financial statements to understand the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. The Company adopted this guidance beginning on January 1, 2018. The guidance allows the selection of one of two methods of adoption, either the full retrospective approach, meaning the guidance would be applied to all periods presented, or modified retrospective approach, meaning the cumulative effect of applying the guidance would be recognized as an adjustment to opening accumulated deficit balance. Since the Company has no revenues to date, the Company does not believe the adoption of ASU‑214‑09 will have a material impact on its financial statements. In February 2016, the FASB issued ASU 2016‑02 Lease Accounting Topic 842 . This ASU requires the Company to record all leases longer than one year on its balance sheet. Under the new guidance, when the Company records leases on its balance sheet it will record a liability with a value equal to the present value of payments it will make over the life of the lease and an asset representing the underlying leased asset. The new accounting guidance requires the Company to determine if its leases are operating or financing leases, similar to current accounting guidance. The Company will record expense for operating type leases on a straight-line basis as an operating expense and it will record expense for finance type leases as interest expense. The new lease standard is effective for annual and interim periods beginning after December 15, 2018, with early adoption permitted. The Company must adopt the new standard on a modified retrospective basis, which requires it to reflect its leases on its balance sheet for the earliest comparative period presented. The Company is currently assessing the timing of adoption as well as the effects it will have on its financial statements and disclosures. The SEC staff issued Staff Accounting Bulletin ("SAB") 118, which provides guidance on accounting for the tax effects of the U.S. tax reform announced on December 22, 2017 by the U.S. Government commonly referred to as the Tax Cuts and Jobs Act. SAB 118 provides a measurement period that should not extend beyond one year from the U.S. tax reform enactment date for companies to complete the accounting under Accounting Standards Codification ("ASC") 740. In accordance with SAB 118, a company must reflect the income tax effects of those aspects of the U.S. tax reform for which the accounting under ASC 740 is complete. Specifically, the Company revalued its U.S. deferred tax assets and liabilities due to the federal income tax rate reduction from 35 percent to 21 percent. Since the Company has provided a full valuation allowance against its deferred tax assets, the revaluation of the deferred tax assets did not have a material impact on any period presented. In June 2018 the FASB issued ASU 2018-07 Compensation – Stock Compensation Topic 718. This ASU was issued as part of the FASB’s simplification initiative. The amendments in this Update expand the scope of Topic 718 to include sharebased payment transactions for acquiring goods and services from nonemployees. An entity should apply the requirements of Topic 718 to nonemployee awards except for specific guidance on inputs to an option pricing model and the attribution of cost (that is, the period of time over which share-based payment awards vest and the pattern of cost recognition over that period). The amendments specify that Topic 718 applies to all share-based payment transactions in which a grantor acquires goods or services to be used or consumed in a grantor’s own operations by issuing share-based payment awards. The amendments also clarify that Topic 718 does not apply to share-based payments used to effectively provide (1) financing to the issuer or (2) awards granted in conjunction with selling goods or services to customers as part of a contract accounted for under Topic 606, Revenue from Contracts with Customers. The Company is currently assessing the timing of adoption as well as the effects it will have on its financial statements and disclosures. |
Equipment (Tables)
Equipment (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Equipment | |
Equipment | June 30, December 31, 2018 2017 Unaudited Computers and related equipment $ 125 $ 5 Accumulated depreciation $ (3) $ (1) $ 122 $ 4 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Accrued Expenses | |
Schedule of Accrued Expenses | June 30, 2018 December 31, 2017 (Unaudited) Accrued salaries, benefits and travel related costs $ 203 $ 79 Professional and consultant fees 95 120 Legal expenses 104 413 Drugs and clinical trial expenses 98 403 $ 500 $ 1,015 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Employees | |
Stock-Based Compensation | |
Schedule of Valuation Assumptions | (Unaudited) For the Six Months Ended June 30, 2018 Exercise price per share $ - $ Expected stock price volatility % - % Risk-free rate of interest % - % Fair value of grants per share $ - $ Expected Term (years) - |
Schedule of Stock Option Activity | Weighted Average Number Weighted Average Total Remaining of Exercise Intrinsic Contractual Shares Price per Share Value Life (in years) Outstanding as of January 1, 2018 1,813,524 $ 0.65 $ 13,894,762 9.7 Employee options granted 143,148 $ 11.00 $ — 10.0 Outstanding as of March 31, 2018 1,956,672 $ 1.41 $ 17,395,705 9.4 Employee options granted 100,000 $ 10.06 $ 16,100 9.9 Options reclassified from Non-employee 154,178 $ 2.45 $ 1,093,696 9.3 Outstanding as of June 30, 2018 2,210,850 $ 1.87 $ 16,619,436 9.2 Options vested and exercisable as of June 30, 2018 1,370,283 0.41 $ 12,038,174 9.2 |
Non-Employees | |
Stock-Based Compensation | |
Schedule of Valuation Assumptions | (Unaudited) For the Six Months Ended June 30, 2018 Exercise price per share $ - $ Expected stock price volatility % - % Risk-free rate of interest % - % Fair value of grants per share $ - $ Expected Term (years) - |
Schedule of Stock Option Activity | Weighted Average Number Weighted Average Total Remaining of Exercise Intrinsic Contractual Shares Price per Share Value Life (in years) Outstanding as of January 1, 2018 496,515 $ 0.41 $ 3,922,238 9.6 Non-employee options granted 68,256 $ 11.00 $ — 10.0 Non-employee options forfeited (6,162) $ 0.41 Outstanding as of March 31, 2018 558,609 $ 1.70 $ 4,820,170 9.5 Non-employee options forfeited (154,178) $ 2.45 Outstanding as of June 30, 2018 404,431 $ 1.42 $ 3,216,507 9.2 Options vested and exercisable as of June 30, 2018 43,717 0.71 $ 372,898 9.2 |
Organization and Principal Ac22
Organization and Principal Activities (Details) | 6 Months Ended |
Jun. 30, 2018item | |
Organization and Principal Activities | |
Number of advanced program | 2 |
Number of emerging programs | 2 |
Initial Public Offering (Detail
Initial Public Offering (Details) $ / shares in Units, $ in Thousands | Mar. 12, 2018USD ($)$ / sharesshares | Mar. 31, 2018USD ($) | Oct. 31, 2017USD ($)$ / sharesshares | Sep. 30, 2017USD ($)$ / sharesshares | Feb. 28, 2017USD ($)$ / sharesshares | Jan. 31, 2017USD ($)$ / sharesshares | Jun. 30, 2018USD ($)$ / sharesshares | Dec. 31, 2017USD ($)$ / sharesshares |
Number of shares issued | shares | 271,839 | 155,709 | 283,452 | 283,452 | ||||
Purchase price (in dollar per share) | $ / shares | $ 4.82 | $ 4.82 | $ 6.88 | $ 6.88 | ||||
Proceeds from issuance of common stock, net | $ 1,311 | $ 751 | $ 1,950 | $ 1,950 | $ 56,512 | |||
Underwriting discounts and commissions | $ 4,200 | |||||||
Deferred offering costs | $ 461 | |||||||
Common stock, shares authorized (in shares) | shares | 50,000,000 | 50,000,000 | 50,000,000 | |||||
Common shares, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | $ 0.001 | |||||
Preferred stock, shares authorized (in shares) | shares | 10,000,000 | 10,000,000 | 10,000,000 | |||||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | $ 0.001 | |||||
IPO | ||||||||
Number of shares issued | shares | 5,454,545 | |||||||
Purchase price (in dollar per share) | $ / shares | $ 11 | |||||||
Gross proceeds from issuance of common stock | $ 60,000 | |||||||
Proceeds from issuance of common stock, net | 54,102 | |||||||
Underwriting discounts and commissions | 4,200 | |||||||
Deferred offering costs | $ 1,698 | |||||||
Stock split | 237 |
Summary of Significant Accoun24
Summary of Significant Accounting Policies (Details) - USD ($) $ in Thousands | Dec. 22, 2017 | Mar. 31, 2018 | Jun. 30, 2018 | Jun. 30, 2018 | Dec. 31, 2017 |
Summary of Significant Accounting Policies | |||||
Deferred offering costs | $ 461 | ||||
Commissions paid | $ 4,200 | ||||
Other offering expenses | $ 1,237 | ||||
Anti-dilutive securities (in shares) | 2,542,644 | 2,446,146 | |||
Federal income tax rate (as a percent) | 35.00% | 21.00% | |||
Computers and related equipment | |||||
Summary of Significant Accounting Policies | |||||
Useful life | 5 years |
Transactions with BioXcel (Deta
Transactions with BioXcel (Details) - USD ($) $ in Thousands | Apr. 05, 2018 | Nov. 07, 2017 | Jun. 30, 2017 | Jun. 30, 2018 | Dec. 31, 2017 |
Transactions with BioXcel | |||||
Common shares, issued | 15,645,545 | 9,907,548 | |||
Note payable to Parent | $ 371 | ||||
Collaborative services agreement | |||||
Transactions with BioXcel | |||||
Term of agreement | 5 years | ||||
Development milestones | |||||
Transactions with BioXcel | |||||
Potential milestone payments | $ 10,000 | ||||
Sales milestones | |||||
Transactions with BioXcel | |||||
Potential milestone payments | $ 30,000 | ||||
Maximum milestone (as as percent) | 3.00% | ||||
BioXcel Corporation [Member] | |||||
Transactions with BioXcel | |||||
Common shares, issued | 9,480,000 | ||||
Maximum borrowing capacity | $ 1,000 | ||||
Note payable to Parent | $ 371 | ||||
BioXcel Corporation [Member] | Payment due within 60 days after specified cumulative net sales | |||||
Transactions with BioXcel | |||||
Lump sum payment to parent | $ 5,000 | $ 5,000 | |||
Period specified for payment | 60 days | 60 days | |||
Cumulative net sales | $ 50,000 | $ 50,000 | |||
BioXcel Corporation [Member] | Payments after closing IPO | |||||
Transactions with BioXcel | |||||
Lump sum payment to parent | 2,000 | ||||
BioXcel Corporation [Member] | Payment within thirty days after IPO | |||||
Transactions with BioXcel | |||||
Lump sum payment to parent | 1,000 | ||||
Payment to (received from) related party | $ 1,000 | ||||
BioXcel Corporation [Member] | Payable upon milestones | |||||
Transactions with BioXcel | |||||
Lump sum payment to parent | 1,000 | ||||
BioXcel Corporation [Member] | Payable upon later 12 months IPO and first dosing for BXCL501 | |||||
Transactions with BioXcel | |||||
Lump sum payment to parent | $ 500 | $ 500 | |||
Period specified for payment | 12 months | 12 months | |||
BioXcel Corporation [Member] | Payable upon later of 12 months of IPO and specified milestones | |||||
Transactions with BioXcel | |||||
Lump sum payment to parent | $ 500 | $ 500 | |||
Period specified for payment | 12 months | 12 months |
Equipment (Details)
Equipment (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Equipment | ||
Computers and related equipment | $ 125 | $ 5 |
Accumulated depreciation | (3) | (1) |
Equipment, net | $ 122 | $ 4 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - BioXcel Corporation [Member] - USD ($) $ in Thousands | Apr. 05, 2018 | Nov. 07, 2017 | Jun. 30, 2018 |
Payment due within 60 days after specified cumulative net sales | |||
Commitments and Contingencies | |||
Lump sum payment to parent | $ 5,000 | $ 5,000 | |
Period specified for payment | 60 days | 60 days | |
Cumulative net sales | $ 50,000 | $ 50,000 | |
Payments after closing IPO | |||
Commitments and Contingencies | |||
Lump sum payment to parent | 2,000 | ||
Payment within thirty days after IPO | |||
Commitments and Contingencies | |||
Lump sum payment to parent | 1,000 | ||
Payment to (received from) related party | $ 1,000 | ||
Payable upon milestones | |||
Commitments and Contingencies | |||
Lump sum payment to parent | 1,000 | ||
Payable upon later 12 months IPO and first dosing for BXCL501 | |||
Commitments and Contingencies | |||
Lump sum payment to parent | $ 500 | $ 500 | |
Period specified for payment | 12 months | 12 months | |
Payable upon later of 12 months of IPO and specified milestones | |||
Commitments and Contingencies | |||
Lump sum payment to parent | $ 500 | $ 500 | |
Period specified for payment | 12 months | 12 months |
Accrued Expenses (Details)
Accrued Expenses (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Accrued Expenses | ||
Accrued salaries, benefits and travel related costs | $ 203 | $ 79 |
Professional and consultant fees | 95 | 120 |
Legal expenses | 104 | 413 |
Drugs and clinical trial expenses | 98 | 403 |
Accrued expenses | $ 500 | $ 1,015 |
Stockholders' Equity (Deficit)
Stockholders' Equity (Deficit) - Authorized (Details) - $ / shares | Jun. 30, 2018 | Mar. 12, 2018 | Dec. 31, 2017 |
Stockholders' Equity (Deficit) | |||
Preferred shares, authorized | 10,000,000 | 10,000,000 | 10,000,000 |
Preferred shares, par value (dollar per share) | $ 0.001 | $ 0.001 | $ 0.001 |
Preferred shares, issued | 0 | 0 | |
Preferred shares, outstanding | 0 | 0 | |
Common shares, authorized | 50,000,000 | 50,000,000 | 50,000,000 |
Common shares, par value (in dollars per share) | $ 0.001 | $ 0.001 | $ 0.001 |
Common stock outstanding | 15,645,545 | 9,907,548 |
Stockholders' Equity (Deficit30
Stockholders' Equity (Deficit) - Common Stock (Details) $ / shares in Units, $ in Thousands | Mar. 12, 2018USD ($)$ / sharesshares | Mar. 31, 2018USD ($) | Oct. 31, 2017USD ($)$ / sharesshares | Sep. 30, 2017USD ($)$ / sharesshares | Feb. 28, 2017USD ($)$ / sharesshares | Jan. 31, 2017USD ($)$ / sharesshares | Jun. 30, 2018USD ($)item | Dec. 31, 2017USD ($) |
Number of vote per common stock | item | 1 | |||||||
Number of shares issued | shares | 271,839 | 155,709 | 283,452 | 283,452 | ||||
Purchase price (in dollar per share) | $ / shares | $ 4.82 | $ 4.82 | $ 6.88 | $ 6.88 | ||||
Proceeds from issuance of common stock, net | $ 1,311 | $ 751 | $ 1,950 | $ 1,950 | $ 56,512 | |||
Underwriting discounts and commissions | $ 4,200 | |||||||
Deferred offering costs | $ 461 | |||||||
IPO | ||||||||
Number of shares issued | shares | 5,454,545 | |||||||
Purchase price (in dollar per share) | $ / shares | $ 11 | |||||||
Gross proceeds from issuance of common stock | $ 60,000 | |||||||
Proceeds from issuance of common stock, net | 54,102 | |||||||
Underwriting discounts and commissions | 4,200 | |||||||
Deferred offering costs | $ 1,698 |
Stock-Based Compensation - Fair
Stock-Based Compensation - Fair value assumptions (Details) - $ / shares | 6 Months Ended | ||||
Jun. 30, 2018 | Oct. 31, 2017 | Sep. 30, 2017 | Feb. 28, 2017 | Jan. 31, 2017 | |
Stock-Based Compensation | |||||
Authorized shares | 3,462,570 | ||||
Fair value of grants per share | $ 4.82 | $ 4.82 | $ 6.88 | $ 6.88 | |
Options | |||||
Stock-Based Compensation | |||||
Terms of award | ten | ||||
Vesting period | 4 years | ||||
Expected dividend yield (as a percent) | 0.00% | ||||
Options | Employees | |||||
Stock-Based Compensation | |||||
Expected stock price volatility, minimum (as a percent) | 77.12% | ||||
Expected stock price volatility, maximum (as a percent) | 78.02% | ||||
Risk-free rate of interest, minimum (as a percent) | 2.68% | ||||
Risk-free rate of interest, maximum (as a percent) | 2.90% | ||||
Options | Employees | Minimum | |||||
Stock-Based Compensation | |||||
Exercise price per share (in dollars per share) | $ 0.41 | ||||
Fair value of grants per share | $ 5.40 | ||||
Expected Term (years) | 4 years 8 months 12 days | ||||
Options | Employees | Maximum | |||||
Stock-Based Compensation | |||||
Exercise price per share (in dollars per share) | $ 11 | ||||
Fair value of grants per share | $ 10.82 | ||||
Expected Term (years) | 7 years | ||||
Options | Non-Employees | |||||
Stock-Based Compensation | |||||
Expected stock price volatility, minimum (as a percent) | 76.30% | ||||
Expected stock price volatility, maximum (as a percent) | 76.62% | ||||
Risk-free rate of interest, minimum (as a percent) | 2.84% | ||||
Risk-free rate of interest, maximum (as a percent) | 2.85% | ||||
Options | Non-Employees | Minimum | |||||
Stock-Based Compensation | |||||
Exercise price per share (in dollars per share) | $ 0.41 | ||||
Fair value of grants per share | $ 7.16 | ||||
Expected Term (years) | 9 years 2 months 12 days | ||||
Options | Non-Employees | Maximum | |||||
Stock-Based Compensation | |||||
Exercise price per share (in dollars per share) | $ 11 | ||||
Fair value of grants per share | $ 8.96 | ||||
Expected Term (years) | 9 years 8 months 12 days |
Stock-Based Compensation - Stoc
Stock-Based Compensation - Stock Option Activity (Details) - Options - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2018 | Mar. 31, 2018 | Jun. 30, 2018 | Dec. 31, 2017 | |
Number of Shares | ||||
Options granted (in shares) | 311,404 | |||
Employees | ||||
Number of Shares | ||||
Outstanding, beginning balance (in shares) | 1,956,672 | 1,813,524 | 1,813,524 | |
Options granted (in shares) | 100,000 | 143,148 | ||
Options reclassification from non-employee to employee (in shares) | 154,178 | |||
Outstanding, ending balance (in shares) | 2,210,850 | 1,956,672 | 2,210,850 | 1,813,524 |
Options vested and exercisable (in shares) | 1,370,283 | 1,370,283 | ||
Weighted Average Exercise Price per Share | ||||
Outstanding, beginning balance (in dollars per shares) | $ 1.41 | $ 0.65 | $ 0.65 | |
Options granted (in dollars per share) | 10.06 | 11 | ||
Options reclassification from non-employee to employee (in dollars per shares) | 2.45 | |||
Outstanding, end balance (in dollars per shares) | 1.87 | $ 1.41 | 1.87 | $ 0.65 |
Options vested and exercisable (in dollars per shares) | $ 0.41 | $ 0.41 | ||
Total Intrinsic Value | ||||
Outstanding, beginning balance | $ 17,395,705 | $ 13,894,762 | $ 13,894,762 | |
Options granted | 16,100 | |||
Options reclassification from non-employee to employee | 1,093,696 | |||
Outstanding, end balance | 16,619,436 | $ 17,395,705 | 16,619,436 | $ 13,894,762 |
Options vested and exercisable | $ 12,038,174 | $ 12,038,174 | ||
Weighted Average Remaining Contractual Life | ||||
Outstanding | 9 years 4 months 24 days | 9 years 2 months 12 days | 9 years 8 months 12 days | |
Options granted | 9 years 10 months 24 days | 10 years | ||
Options reclassification from non-employee to employee | 9 years 3 months 18 days | |||
Options vested and exercisable | 9 years 2 months 12 days | |||
Non-Employees | ||||
Number of Shares | ||||
Outstanding, beginning balance (in shares) | 558,609 | 496,515 | 496,515 | |
Options granted (in shares) | 68,256 | |||
Options forfeited (in shares) | (6,162) | (154,178) | ||
Outstanding, ending balance (in shares) | 404,431 | 558,609 | 404,431 | 496,515 |
Options vested and exercisable (in shares) | 43,717 | 43,717 | ||
Weighted Average Exercise Price per Share | ||||
Outstanding, beginning balance (in dollars per shares) | $ 1.70 | $ 0.41 | $ 0.41 | |
Options granted (in dollars per share) | 11 | |||
Options forfeited (in dollars per shares) | 0.41 | 2.45 | ||
Outstanding, end balance (in dollars per shares) | 1.42 | $ 1.70 | 1.42 | $ 0.41 |
Options vested and exercisable (in dollars per shares) | $ 0.71 | $ 0.71 | ||
Total Intrinsic Value | ||||
Outstanding, beginning balance | $ 4,820,170 | $ 3,922,238 | $ 3,922,238 | |
Outstanding, end balance | 3,216,507 | $ 4,820,170 | 3,216,507 | $ 3,922,238 |
Options vested and exercisable | $ 372,898 | $ 372,898 | ||
Weighted Average Remaining Contractual Life | ||||
Outstanding | 9 years 6 months | 9 years 2 months 12 days | 9 years 7 months 6 days | |
Options granted | 10 years | |||
Options vested and exercisable | 9 years 2 months 12 days |
Stock-Based Compensation - Opti
Stock-Based Compensation - Option Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Stock-Based Compensation | ||||
Share-based compensation costs recognized | $ 742 | $ 93 | $ 2,060 | $ 200 |
Options | ||||
Stock-Based Compensation | ||||
Options exercised (in shares) | 0 | |||
Available for grant (in shares) | 847,289 | 847,289 | ||
Share-based compensation costs recognized | $ 666 | $ 1,861 | $ 0 | |
Options | Employees | ||||
Stock-Based Compensation | ||||
Weighted-average grant-date fair value | 3,286 | |||
Remaining unamortized expense | 1,804 | $ 1,804 | ||
Remaining unamortized expense period | 1 year 9 months 18 days | |||
Options | Non-Employees | ||||
Stock-Based Compensation | ||||
Weighted-average grant-date fair value | $ 572 | |||
Remaining unamortized expense | $ 3,176 | $ 3,176 | ||
Remaining unamortized expense period | 1 year 6 months |
Stock-Based Compensation - BioX
Stock-Based Compensation - BioXcel Charges (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Stock-Based Compensation | ||||
Share-based compensation costs recognized | $ 742 | $ 93 | $ 2,060 | $ 200 |
Options | ||||
Stock-Based Compensation | ||||
Share-based compensation costs recognized | 666 | 1,861 | 0 | |
Options | BioXcel Corporation [Member] | ||||
Stock-Based Compensation | ||||
Share-based compensation costs recognized | $ 76 | $ 93 | $ 199 | $ 200 |
Income Taxes - Reconciliation (
Income Taxes - Reconciliation (Details) - USD ($) | Jun. 30, 2018 | Dec. 31, 2017 |
Income Taxes | ||
Income tax liabilities | $ 0 | $ 0 |
Leases (Details)
Leases (Details) - Building $ in Thousands | Jun. 21, 2018USD ($)ft² |
5th Floor Lease | |
Leases | |
Area of lease | ft² | 5,300 |
5th Floor Lease | Through termination date | |
Leases | |
Base rent (per month) | $ 0 |
Electricity expense (per month) | 1 |
5th Floor Lease | Beyond termination date | |
Leases | |
Base rent (per month) | $ 12 |
12th Floor Lease | |
Leases | |
Area of lease | ft² | 11,000 |
Term for execution of lease | 60 days |
12th Floor Lease | Beyond expiration date | |
Leases | |
Base rent (per month) | $ 8 |