Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2023 | Aug. 11, 2023 | |
Document and Entity Information | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Jun. 30, 2023 | |
Entity File Number | 001-40536 | |
Entity Registrant Name | Acurx Pharmaceuticals, Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 82-3733567 | |
Entity Address State Or Province | NY | |
Entity Address, Address Line One | 259 Liberty Ave | |
Entity Address, City or Town | Staten Island | |
Entity Address, Postal Zip Code | 10305 | |
City Area Code | 917 | |
Local Phone Number | 533-1469 | |
Title of 12(b) Security | Common Stock, $0.001 par value per share | |
Trading Symbol | ACXP | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 13,005,128 | |
Entity Central Index Key | 0001736243 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false |
CONDENSED INTERIM BALANCE SHEET
CONDENSED INTERIM BALANCE SHEETS - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
CURRENT ASSETS | ||
Cash | $ 9,145,835 | $ 9,111,751 |
Prepaid Expenses | 89,942 | 264,955 |
TOTAL ASSETS | 9,235,777 | 9,376,706 |
CURRENT LIABILITIES | ||
Accounts Payable and Accrued Expenses | 3,019,408 | 2,061,685 |
TOTAL CURRENT LIABILITIES | 3,019,408 | 2,061,685 |
TOTAL LIABILITIES | 3,019,408 | 2,061,685 |
COMMITMENTS AND CONTINGENCIES | ||
SHAREHOLDERS' EQUITY | ||
Common Stock; $.001 par value, 200,000,000 shares authorized, 13,005,128 and 11,627,609 shares issued and outstanding at June 30, 2023 and December 31, 2022, respectively | 13,005 | 11,628 |
Additional Paid-In Capital | 51,192,646 | 45,944,478 |
Accumulated Deficit | (44,989,282) | (38,641,085) |
TOTAL SHAREHOLDERS' EQUITY | 6,216,369 | 7,315,021 |
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ 9,235,777 | $ 9,376,706 |
CONDENSED INTERIM BALANCE SHE_2
CONDENSED INTERIM BALANCE SHEETS (Parenthetical) - $ / shares | Jun. 30, 2023 | Dec. 31, 2022 |
CONDENSED INTERIM BALANCE SHEETS | ||
Common stock, Par value | $ 0.001 | $ 0.001 |
Common stock, Authorized (in shares) | 200,000,000 | 200,000,000 |
Common stock, Issued (in shares) | 13,005,128 | 11,627,609 |
Common stock, Outstanding (in shares) | 13,005,128 | 11,627,609 |
CONDENSED INTERIM STATEMENTS OF
CONDENSED INTERIM STATEMENTS OF OPERATIONS - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
OPERATING EXPENSES | ||||
Research and Development | $ 1,736,386 | $ 911,692 | $ 2,751,969 | $ 1,730,580 |
General and Administrative | 1,708,854 | 1,708,841 | 3,596,228 | 3,560,090 |
TOTAL OPERATING EXPENSES | 3,445,240 | 2,620,533 | 6,348,197 | 5,290,670 |
NET LOSS | $ (3,445,240) | $ (2,620,533) | $ (6,348,197) | $ (5,290,670) |
LOSS PER SHARE | ||||
Basic net loss per common share | $ (0.28) | $ (0.26) | $ (0.53) | $ (0.52) |
Diluted net loss per common share | $ (0.28) | $ (0.26) | $ (0.53) | $ (0.52) |
Weighted average common shares outstanding basic | 12,186,481 | 10,263,202 | 11,914,449 | 10,248,107 |
Weighted average common shares outstanding diluted | 12,186,481 | 10,263,202 | 11,914,449 | 10,248,107 |
CONDENSED INTERIM STATEMENTS _2
CONDENSED INTERIM STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($) | Common Stock | Additional Paid-In Capital | Accumulated Deficit | Total |
Balance at beginning at Dec. 31, 2021 | $ 10,216 | $ 38,948,334 | $ (26,548,309) | $ 12,410,241 |
Balance at beginning, Common shares (in shares) at Dec. 31, 2021 | 10,215,792 | |||
Share-Based Compensation | 761,069 | 761,069 | ||
Share-Based Payments to Vendors | $ 44 | 188,056 | 188,100 | |
Share-Based Payments to Vendors (in shares) | 43,889 | |||
Cashless Warrant Exercise | $ 3 | (3) | ||
Cashless Warrant Exercise (in shares) | 3,521 | |||
Net Loss | (2,670,138) | (2,670,138) | ||
Balance at ending at Mar. 31, 2022 | $ 10,263 | 39,897,456 | (29,218,447) | 10,689,272 |
Balance at ending, Common shares (in shares) at Mar. 31, 2022 | 10,263,202 | |||
Balance at beginning at Dec. 31, 2021 | $ 10,216 | 38,948,334 | (26,548,309) | 12,410,241 |
Balance at beginning, Common shares (in shares) at Dec. 31, 2021 | 10,215,792 | |||
Net Loss | (5,290,670) | |||
Balance at ending at Jun. 30, 2022 | $ 10,263 | 40,614,138 | (31,838,980) | 8,785,421 |
Balance at ending, Common shares (in shares) at Jun. 30, 2022 | 10,263,202 | |||
Balance at beginning at Mar. 31, 2022 | $ 10,263 | 39,897,456 | (29,218,447) | 10,689,272 |
Balance at beginning, Common shares (in shares) at Mar. 31, 2022 | 10,263,202 | |||
Share-Based Compensation | 716,682 | 716,682 | ||
Net Loss | (2,620,533) | (2,620,533) | ||
Balance at ending at Jun. 30, 2022 | $ 10,263 | 40,614,138 | (31,838,980) | 8,785,421 |
Balance at ending, Common shares (in shares) at Jun. 30, 2022 | 10,263,202 | |||
Balance at beginning at Dec. 31, 2022 | $ 11,628 | 45,944,478 | (38,641,085) | $ 7,315,021 |
Balance at beginning, Common shares (in shares) at Dec. 31, 2022 | 11,627,609 | 11,627,609 | ||
Share-Based Compensation | 733,472 | $ 733,472 | ||
Share-Based Payments to Vendors | $ 44 | 165,859 | 165,903 | |
Share-Based Payments to Vendors (in shares) | 44,186 | |||
Net Loss | (2,902,957) | (2,902,957) | ||
Balance at ending at Mar. 31, 2023 | $ 11,672 | 46,843,809 | (41,544,042) | 5,311,439 |
Balance at ending, Common shares (in shares) at Mar. 31, 2023 | 11,671,795 | |||
Balance at beginning at Dec. 31, 2022 | $ 11,628 | 45,944,478 | (38,641,085) | $ 7,315,021 |
Balance at beginning, Common shares (in shares) at Dec. 31, 2022 | 11,627,609 | 11,627,609 | ||
Net Loss | $ (6,348,197) | |||
Balance at ending at Jun. 30, 2023 | $ 13,005 | 51,192,646 | (44,989,282) | $ 6,216,369 |
Balance at ending, Common shares (in shares) at Jun. 30, 2023 | 13,005,128 | 13,005,128 | ||
Balance at beginning at Mar. 31, 2023 | $ 11,672 | 46,843,809 | (41,544,042) | $ 5,311,439 |
Balance at beginning, Common shares (in shares) at Mar. 31, 2023 | 11,671,795 | |||
Share-Based Compensation | 806,485 | 806,485 | ||
Issuance of shares of common stock and pre-funded warrants in registered direct offering, net of cash issuance costs | $ 602 | 3,543,010 | 3,543,612 | |
Issuance of shares of common stock and pre-funded warrants in registered direct offering, net of cash issuance costs (in shares) | 601,851 | |||
Pre-funded Warrant Exercise | $ 731 | (658) | 73 | |
Pre-funded Warrant Exercise (in shares) | 731,482 | |||
Net Loss | (3,445,240) | (3,445,240) | ||
Balance at ending at Jun. 30, 2023 | $ 13,005 | $ 51,192,646 | $ (44,989,282) | $ 6,216,369 |
Balance at ending, Common shares (in shares) at Jun. 30, 2023 | 13,005,128 | 13,005,128 |
CONDENSED INTERIM STATEMENTS _3
CONDENSED INTERIM STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (Parenthetical) - USD ($) | 3 Months Ended | |
Jun. 29, 2021 | Jun. 30, 2023 | |
CONDENSED INTERIM STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY | ||
Cash issuance cost | $ 2,400,000 | $ 456,314 |
CONDENSED INTERIM STATEMENTS _4
CONDENSED INTERIM STATEMENTS OF CASH FLOWS - USD ($) | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Cash Flow from Operating Activities: | ||
Net Loss | $ (6,348,197) | $ (5,290,670) |
Adjustments to Reconcile Net Loss to Net Cash Used in Operating Activities: | ||
Share-Based Compensation | 1,539,957 | 1,477,751 |
Share-Based Payments to Vendors | 165,903 | 188,100 |
(Increase)/Decrease in: | ||
Prepaid Expenses | 175,013 | 178,448 |
Deferred Offering Costs | (50,247) | |
Accounts Payable and Accrued Expenses | 957,723 | (370,031) |
Net Cash Used in Operating Activities | (3,509,601) | (3,866,649) |
Cash Flow from Financing Activities: | ||
Proceeds from Registered Direct Offering, net of issuance costs | 3,543,612 | |
Pre-funded Warrant Exercise | 73 | |
Net Cash Provided by Financing Activities | 3,543,685 | |
Net Increase/(Decrease) in Cash | 34,084 | (3,866,649) |
Cash at Beginning of Period | 9,111,751 | 12,958,846 |
Cash at End of Period | 9,145,835 | $ 9,092,197 |
SUPPLEMENTAL DISCLOSURE OF NON-CASH FINANCING ACTIVITIES | ||
Accrued Registered Direct Offering costs | 54,058 | |
Registered Direct offering costs | $ 1,990,153 |
NATURE OF OPERATIONS
NATURE OF OPERATIONS | 6 Months Ended |
Jun. 30, 2023 | |
NATURE OF OPERATIONS | |
NATURE OF OPERATIONS | NOTE 1 – NATURE OF OPERATIONS Business Acurx Pharmaceuticals, Inc., a Delaware corporation, formerly Acurx Pharmaceuticals, LLC (the “Company”) is a clinical stage biopharmaceutical company formed in July 2017, with operations commencing in February 2018. The Company is focused on developing a novel class of antibiotics that address serious or life threatening bacterial infections. In March 2020, the World Health Organization declared the outbreak of COVID-19, a novel strain of coronavirus, a global pandemic. This outbreak caused major disruptions to businesses and markets worldwide as the virus continued to spread. The COVID-19 pandemic has disrupted, and the Company expects it will continue to disrupt, its operations. The extent of the effect on the Company’s operational and financial performance will depend on future developments, including the duration, spread and intensity of the pandemic, and governmental, regulatory and private sector responses, direct and indirect economic effects as a result of inflation, supply chain disruptions and labor shortages all of which are uncertain and difficult to predict. Although the Company is unable to estimate the financial effect of the pandemic, at this time, if the pandemic and post-pandemic behavioral patterns continue over a long period of time, it could have a material adverse effect on the Company’s business, results of operations, financial condition, and cash flows. The financial statements do not reflect any adjustments as a result of the pandemic. In February 2018, the Company purchased the active pharmaceutical ingredient, the intellectual property and other rights to an antibiotic product candidate known as GLS362E (renamed ACX-362E and now approved for non-proprietary name, ibezapolstat) (the “Asset”) from GLSynthesis, Inc. The Company paid $110,174 in cash, along with granting 100,000 Class B Membership Interests, profits interests as defined in the operating agreement, with an exercise price of $0.10 per share. The Company was also required to make certain milestone payments totaling $700,000 in aggregate if certain milestones are achieved, $50,000 of which has already been paid by the Company and royalty payments equal to 4% of net sales for a period of time equal to the last to expire of any applicable patents, as defined in the asset purchase agreement. The purchase of the Asset has resulted in our lead antibiotic product candidate, ibezapolstat, which targets the treatment of C. difficile infections (“CDI”). The Company’s primary activities since inception aside from organizational activities have included performing research and development activities relating to the development of its two antibiotic candidates and raising funds through equity offerings including its initial public offering (“IPO”) consummated in June 2021 and registered direct offerings consummated in July 2022 and May 2023. The Company has not generated any revenues since inception. The Company has experienced net losses and negative cash flows from operations since inception and expects these conditions to continue for the foreseeable future. The Company has needed to raise capital from sales of its securities to sustain operations. On June 29, 2021, the Company completed the IPO, issuing 2,875,000 shares of common stock at a price of $6.00 per share, with gross proceeds of approximately $17.3 million. On July 27, 2022, the Company completed a registered direct offering and a concurrent private placement, issuing million. On May 18, 2023, the Company completed a registered direct offering and a concurrent private placement, issuing million. As of June 30, 2023, the Company had a cash balance of approximately million, which based on current estimates will not be sufficient to meet its anticipated cash requirements for at least 12 months from the issuance of the condensed financial statements for the period ended June 30, 2023. Management believes that the Company will continue to incur losses for the foreseeable future and will need additional resources to sustain its operations until it can achieve profitability and positive cash flows, if ever. Management plans to seek additional equity financing and grant funding, but cannot assure that such financing and funding will be available at acceptable terms, or at all. These matters raise substantial doubt about the Company’s ability to continue as a going concern. The accompanying condensed financial statements do not include any adjustments that might result from the outcome of this uncertainty. There can be no assurance that the Company’s research and development will be successfully completed or that any Company product candidate will be approved by the Food and Drug Administration (“FDA”) or any other worldwide regulatory authority or become commercially viable. The Company is subject to risks common to companies in the biopharmaceutical industry including, but not limited to, dependence on collaborative arrangements, development by the Company or its competitors of new technological innovations, dependence on key personnel, protection of proprietary technology, and compliance with FDA and other governmental regulations and approval requirements. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jun. 30, 2023 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying unaudited condensed interim financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and in accordance with the rules and regulations of the United States Securities Exchange Commission for interim reporting. In the opinion of management, these unaudited interim financial statements include all adjustments, consisting only of normal, recurring adjustments, necessary for a fair statement of the Company’s financial position, results of operations, and cash flows. The unaudited interim results of operations are not necessarily indicative of the results that may occur for the full fiscal year. The year-end condensed balance sheet data was derived from audited financial statements, but does not include all disclosures required by GAAP. Management believes that the disclosures provided herein are adequate when these unaudited condensed interim financial statements are read in conjunction with the audited financial statements and notes thereto as of December 31, 2022 filed in Form 10-K. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Actual results could differ from those estimates. Income Taxes The Company estimates an annual effective tax rate of 0% as the Company incurred net losses for the three and six months ended June 30, 2023, resulting in an estimated net loss for both financial statement and tax purposes. Therefore, no current federal or state income tax expense has been recorded in the financial statements. Based on the Company’s history of generating operating losses and its anticipation of operating losses for the foreseeable future, the Company has determined that it is more likely than not that the tax benefits from those net operating losses would not be realized and a full valuation allowance against all deferred tax assets has been recorded. Should the Company’s assessment change, tax benefits associated with the historic net operating loss carryforwards could be limited due to future ownership changes. Concentration of Credit Risk The Company maintains its cash balance in one financial institution. The balance is insured up to the maximum allowable by the Federal Deposit Insurance Corporation (“FDIC”). The Company has not experienced any losses in such accounts and does not believe it is exposed to any significant risk of loss on cash. At times, the cash balance may exceed the maximum insured limit of the FDIC. As of June 30, 2023, the Company had cash of approximately $9.1 million in U.S. bank accounts which was not fully insured by the FDIC. Research and Development The Company expenses research and development costs when incurred. At times, the Company may make cash advances for future research and development services. These amounts are deferred and expensed in the period the service is provided. The Company incurred research and development expenses in the amount of $1,736,386 and $911,692 for the three months ended June 30 2023 and 2022, respectively, and $2,751,969 and $1,730,580 for the six months ended June 30, 2023 and 2022, respectively. Costs for certain research and development activities, such as the provision of services for clinical trial activity, are estimated based on an evaluation of the progress to completion of specific tasks which may use data such as subject enrollment, clinical site activations or information provided to the Company by its vendors with respect to their actual costs incurred. Payments for these activities are based on the terms of the individual arrangements, which may differ from the pattern of costs incurred, and are reflected in the financial statements as prepaid or accrued research and development expense, as the case may be. The estimates are adjusted to reflect the best information available at the time of the financial statement issuance. The Company's estimate of the status and timing of services performed could differ from the actual status and timing of services performed. Share-Based Compensation The Company accounts for the cost of services performed by officers and directors received in exchange for an award of Company membership interests, common stock or stock options, based on the grant-date fair value of the award. The Company recognizes compensation expense based on the requisite service period. Compensation expense associated with stock option awards is recognized over the requisite service period based on the fair value of the option at the grant date determined based on the Black-Scholes option pricing model. Option valuation models require the input of highly subjective assumptions including the expected price volatility. The Company’s employee stock options have characteristics significantly different from those of traded options, and changes in the subjective input assumptions can materially affect the fair value computation using the Black-Scholes option pricing model. Because there is no public market for the Company’s stock options and very little historical experience with the Company’s stock, similar public companies were used for the comparison of volatility and the dividend yield. The risk-free rate of return was derived from U.S. Treasury notes with comparable maturities. Share-Based Payments to Vendors The Company accounts for the cost of services performed by vendors in exchange for an award of common stock, stock options, or warrants based on the grant-date fair value of the award or the fair value of the services rendered, whichever is more readily determinable. The Company recognizes the expense in the same period and in the same manner as if the Company had paid cash for the services. Major Vendor The Company had a major vendor that accounted for approximately 75% and 25% of the research and development expenditures for the three months ended June 30, 2023 and 2022, respectively, and 70% and 36% for the six months ended June 30, 2023 and 2022, respectively. The same vendor also accounted for approximately 88% and 56% of the total accounts payable and accrued expenses as of June 30, 2023 and December 31, 2022, respectively. The Company continues to maintain this vendor relationship and anticipates incurring significant expenses with this vendor over the next 12 months. |
ACCOUNTS PAYABLE AND ACCRUED EX
ACCOUNTS PAYABLE AND ACCRUED EXPENSES | 6 Months Ended |
Jun. 30, 2023 | |
ACCOUNTS PAYABLE AND ACCRUED EXPENSES | |
ACCOUNTS PAYABLE AND ACCRUED EXPENSES | NOTE 3 - ACCOUNTS PAYABLE AND ACCRUED EXPENSES Accounts payable and accrued expenses as of June 30, 2023 and December 31, 2022 were as follows: June 30, 2023 December 31, 2022 Accrued compensation expenses $ 35,887 $ 542,895 Accrued research and development 2,881,561 1,405,536 Accrued professional fees 89,081 83,715 Other accounts payable and accrued expenses 12,879 29,539 Total $ 3,019,408 $ 2,061,685 |
ISSUANCE OF EQUITY INTERESTS
ISSUANCE OF EQUITY INTERESTS | 6 Months Ended |
Jun. 30, 2023 | |
ISSUANCE OF EQUITY INTERESTS | |
ISSUANCE OF EQUITY INTERESTS | NOTE 4 – ISSUANCE OF EQUITY INTERESTS On June 23, 2021, Acurx Pharmaceuticals, LLC was converted into a corporation and renamed Acurx Pharmaceuticals, Inc. The Company’s certificate of incorporation authorizes 200,000,000 shares of common stock of which 13,005,128 were outstanding as of June 30, 2023. On June 29, 2021, the Company completed an IPO issuing 2,875,000 shares of common stock at a price of $6.00 per share, resulting in net cash proceeds of approximately $14.8 million, with cash issuance costs of approximately $2.4 million. The outstanding Class A and Class B Membership Interests were converted to shares of common stock pursuant to a conversion ratio of one-for-two of the Membership Interests outstanding, resulting in the conversion of 14,082,318 Class A and Class B Membership Interests into 7,041,208 shares of common stock. Warrants to purchase Class A Membership Interests were converted to warrants to purchase common stock at the same one-for two conversion ratio, resulting in 1,437,577 warrants to purchase common stock with a weighted average exercise price of $2.88. In connection with the IPO, the Company issued 150,000 warrants to the underwriter. Each warrant is exercisable for 4.5 years from December 21, 2021 at an exercise price of $7.50 per share. The Company used the Black-Scholes model to calculate the value of the warrants with an estimated fair value of $618,000. The inputs utilized in the calculation were as follows: four On July 25, 2022, the Company entered into securities purchase agreements with two of the Company’s executives and a member of the Company’s board of directors (collectively, the “Affiliate Investors”), and a single U.S. institutional investor (the “Investor”) pursuant to which the Company issued and sold in a registered direct offering an aggregate of 1,159,211 shares of common stock and pre-funded warrants to purchase an aggregate of 130,769 shares of common stock. The Affiliate Investors purchased an aggregate of 59,211 shares of common stock at a purchase price of $3.80 per share. The Investor purchased an aggregate of 1,100,000 shares of common stock at a purchase price of $3.25 per share and an aggregate of 130,769 pre-funded warrants at a purchase price of $3.2499 per pre-funded warrant. The pre-funded warrants sold to the Investor have an exercise price of $0.0001 and were immediately exercisable. As of June 30, 2023, all of the pre-funded warrants were exercised. The Company also issued to the Affiliate Investors and the Investor in a concurrent private placement, series A warrants to purchase The gross proceeds to the Company from the registered direct offering were $4.2 million and net proceeds after deducting the placement agents’ fees and other offering expenses payable by the Company were approximately $3.7 million. On July 25, 2022, the Company entered into a co-placement agent agreement (the “Placement Agent Agreement”), with two placement agents in connection with the registered direct offering pursuant to which the Company paid the Placement Agents a cash fee of $287,874 and issued to the Placement Agents an aggregate of 63,018 warrants to purchase shares of common stock. The warrants have an exercise price of of the weighted average public offering price of the aggregate number of shares of common stock sold in the registered direct offering to the Investor and Affiliate Investors) and expire on July 27, 2027. The Company used the Black-Scholes model to calculate the value of the warrants with an estimated fair value of . The inputs utilized in the calculation were as follows: volatility utilizing comparable companies. This amount was recorded as both an increase to additional paid-in capital and as a non-cash issuance cost of the offering. On May 16, 2023, the Company entered into a securities purchase agreement with a single healthcare-focused U.S. institutional investor named therein (the “2023 Investor”), pursuant to which the Company issued and sold, in a registered direct offering by the Company directly to the 2023 Investor (the “2023 Registered Offering”), an aggregate of 601,851 shares of common stock at an offering price of $3.00 per share and an aggregate of 731,482 pre-funded warrants exercisable for shares of common stock at an offering price of $2.9999 per pre-funded warrant. The pre-funded warrants sold to the Investor have an exercise price of and were immediately exercisable. As of June 30, 2023, all of the pre-funded warrants were exercised. The gross proceeds to the Company from the registered direct offering were approximately $4.0 million and net proceeds after deducting the placements agent’s fees and other offering expenses payable by the Company were approximately $3.5 million. In a concurrent private placement (the “2023 Private Placement” and together with the 2023 Registered Offering, the “2023 Offerings”), the Company issued to the Investor series C warrants exercisable for an aggregate of 1,333,333 shares of common stock at an exercise price of $3.26 per share and series D warrants exercisable for an aggregate of 1,333,333 shares of common stock at an exercise price of $3.26 per share. The Series C Warrants will be exercisable commencing on November 18, 2023 and will expire on November 18, 2025. The Series D Warrants will be exercisable commencing on November 18, 2023 and will expire on November 19, 2029. In connection with the 2023 Offerings, the Company also entered into a Warrant Amendment Agreement with the 2023 Investor. Under the Warrant Amendment Agreement, the Company amended its existing series A warrants to purchase up to an aggregate of 1,230,769 shares of the Company's common stock and series B warrants to purchase up to an aggregate of 1,230,769 shares of the Company's common stock (collectively, the “Existing Warrants”) that were previously issued in July 2022, such that effective upon the closing of the offering, the amended Existing Warrants will have a termination date of May 18, 2029. The Company used the Black-Scholes model to calculate the change in the value of the aforementioned series A and series B warrants attributable to the change in the termination date, with an estimated increase in fair value of approximately Weighted Average Number of Warrants Exercise Price Balance at December 31, 2022 4,217,809 $ 3.29 Issued 3,398,148 2.56 Exercised (731,482) 0.0001 Balance at June 30, 2023 6,884,475 $ 3.28 The weighted average contractual life of the outstanding warrants is 5.06 years. |
SHARE-BASED COMPENSATION
SHARE-BASED COMPENSATION | 6 Months Ended |
Jun. 30, 2023 | |
SHARE-BASED COMPENSATION | |
SHARE-BASED COMPENSATION | NOTE 5 – SHARE-BASED COMPENSATION In April 2021, the board of directors approved the creation of the 2021 Equity Incentive Plan (the “Plan”). The Plan became effective as of the completion of the corporate conversion, with an annual evergreen provision pursuant to the Plan. The Plan currently reserves an aggregate of 2,874,063 shares of common stock, subject to adjustments as provided in the Plan, of which 485,868 are currently still available for issuance as of June 30, 2023. The purpose of the Plan is to attract, retain and incentivize directors, officers, employees, and consultants. In June 2021, the Company granted stock options to purchase a total of 807,500 shares of common stock to its three executives and three non-employee management team members to replace the Class B Membership Interests that were cancelled in March 2021. The options were issued at an exercise price of $6.26, with the employee options vesting 40% upon issuance and the balance over 36 months, and the non-employee options vesting at grant date. The Company recorded general and administrative expenses of $181,720 and $363,440 for the three and six months ended June 30, 2023 and 2022, respectively, related to compensation expense for these options. In July 2021, the Company granted stock options to purchase a total of 1,550,000 shares of common stock to its three executives pursuant to their respective employment agreements, the independent directors, and one consultant, pursuant to the Plan. The options were issued at an exercise price of $6.18, the grant date fair value, with one In January 2022, the Company granted stock options to purchase a total of 80,000 shares of common stock to seven consultants pursuant to the Plan. The options were issued at an exercise price of $4.44, the grant date fair value, with one In April 2022, the Company granted stock options to purchase a total of 30,000 shares of common stock to a new employee pursuant to the Plan. The options were issued at an exercise price of $3.79, the grant date fair value, with one In February 2023, the Company granted stock options to purchase a total of 467,500 shares of common stock to its four employees and seven consultants pursuant to the Plan. The options were issued at an exercise price of . The Company recorded general and administrative expenses of In June 2023, the Company granted stock options to purchase a total of 50,000 shares of common stock to its five independent board of directors pursuant to the Plan. The options were issued at an exercise price of one -year anniversary of the grant date. The Company recorded general and administrative expenses of Compensation expense associated with these awards is recognized over the vesting period based on the fair value of the option at the grant date determined based on the Black-Scholes model. Option valuation models require the input of highly subjective assumptions including the expected price volatility. The Company’s employee stock options have characteristics significantly different from those of traded options, and changes in the subjective input assumptions can materially affect the fair value computation using the Black-Scholes option pricing model. Because there is no public market for the Company’s stock options and very little historical experience with the Company’s stock, similar public companies were used for the comparison of volatility and the dividend yield. The risk-free rate of return was derived from U.S. Treasury notes with comparable maturities. The Company determined the fair value of the option awards using the Black-Scholes option pricing model using the following weighted average assumptions: Six Months Ended June 30, 2023 Expected term 6.90 years Volatility 98 % Dividend yield — % Risk-free interest rate 3.85 % Weighted average grant date fair value $ 2.75 A summary of the Company’s stock option activity is as follows: Six Months Ended Weighted Average June 30, 2023 Exercise Price Outstanding at the beginning of the period 2,467,500 $ 6.12 Granted 517,500 3.35 Exercised — — Forfeited — — Outstanding at the end of the period 2,985,000 $ 5.64 Exercisable 1,903,361 $ 6.07 The total non-cash compensation expense for these options not yet recognized as of June 30, 2023 was $4,125,421. The weighted average vesting period for the unvested options is 1.64 years. The intrinsic value of the stock options at June 30, 2023 was $0 with a remaining weighted average contractual life of 8.31 years. The Company records the impact of any forfeitures of options as they occur. |
SHARE-BASED PAYMENTS TO VENDORS
SHARE-BASED PAYMENTS TO VENDORS | 6 Months Ended |
Jun. 30, 2023 | |
SHARE-BASED PAYMENTS TO VENDORS | |
SHARE-BASED PAYMENTS TO VENDORS | NOTE 6 – SHARE-BASED PAYMENTS TO VENDORS In the fourth quarter of 2021, the Company entered into an agreement with a consultant to provide financial advisory services for a six-month term. Pursuant to the agreement, the Company granted $150,000 of common stock over the term of service. In January 2022, the Company granted 13,889 shares of common stock at grant date fair value, pursuant to the agreement and recorded general and administrative expenses of $0 for the three months ended June 30, 2023, and 2022, respectively and $0 and $75,000 for the six months ended June 30, 2023 and 2022, respectively. In the first quarter of 2022, the Company entered into an agreement with a consultant to provide investor relation services for a six-month term. Pursuant to the agreement, the Company granted 30,000 shares of common stock with a grant date fair value of $3.77 and paid $25,000 of cash compensation. The cash component was be expensed over the service period and the equity component expensed consistent with the contractual vesting. The Company recorded general and administrative expenses of $0 for the three months ended June 30 2023 and 2022, respectively, and $0 and $113,100 for the six months ended June 30, 2023 and 2022, respectively. In the fourth quarter of 2022, the Company entered into a number of agreements with vendors pursuant to which the Company made grants of a total of 43,186 shares of common stock with grant date fair values ranging from $3.30 to $3.67, up to 10,096 of warrants, and cash payments. These contracts have terms with various contractual vesting periods. The cash payments were expensed over the service period and the equity components were expensed consistent with the various contractual vesting periods. The Company recorded general and administrative expenses of In the first quarter of 2023, the Company entered into an agreement with a consultant to provide investor relation services for a six-month term. The Company granted 36,000 shares of common stock at a grant date fair value of $3.31, pursuant to the agreement and recorded general and administrative expenses of $0 and $119,160 for the three and six months ended June 30, 2023, respectively. |
NET LOSS PER SHARE
NET LOSS PER SHARE | 6 Months Ended |
Jun. 30, 2023 | |
NET LOSS PER SHARE | |
NET LOSS PER SHARE | NOTE 7 – NET LOSS PER SHARE Basic and diluted net loss per shares of common stock for the six months ended June 30, 2023 and 2022 was determined by dividing net loss by the weighted average shares of common stock outstanding during the period. The Company’s potentially dilutive shares, consisting of 6,884,475 warrants and 2,985,000 stock options, have not been included in the computation of diluted net loss per share for all periods as the result would be antidilutive. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Jun. 30, 2023 | |
COMMITMENTS AND CONTINGENCIES. | |
COMMITMENTS AND CONTINGENCIES | NOTE 8 – COMMITMENTS AND CONTINGENCIES In conjunction with the Asset purchase in February 2018, the Company is required to make certain milestone payments related to the ongoing development of ACX-362E totaling $700,000 in the aggregate if certain milestones are achieved (which includes $50,000 already paid after the acquisition in February 2018). There were no additional milestones reached for the six months ended June 30, 2023 and 2022, respectively. The Company is also obligated to make royalty payments equal to 4% of net sales of ACX-362E for a period of time equal to the last to expire of any applicable patents, as defined in the purchase agreement. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jun. 30, 2023 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed interim financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and in accordance with the rules and regulations of the United States Securities Exchange Commission for interim reporting. In the opinion of management, these unaudited interim financial statements include all adjustments, consisting only of normal, recurring adjustments, necessary for a fair statement of the Company’s financial position, results of operations, and cash flows. The unaudited interim results of operations are not necessarily indicative of the results that may occur for the full fiscal year. The year-end condensed balance sheet data was derived from audited financial statements, but does not include all disclosures required by GAAP. Management believes that the disclosures provided herein are adequate when these unaudited condensed interim financial statements are read in conjunction with the audited financial statements and notes thereto as of December 31, 2022 filed in Form 10-K. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Actual results could differ from those estimates. |
Income Taxes | Income Taxes The Company estimates an annual effective tax rate of 0% as the Company incurred net losses for the three and six months ended June 30, 2023, resulting in an estimated net loss for both financial statement and tax purposes. Therefore, no current federal or state income tax expense has been recorded in the financial statements. Based on the Company’s history of generating operating losses and its anticipation of operating losses for the foreseeable future, the Company has determined that it is more likely than not that the tax benefits from those net operating losses would not be realized and a full valuation allowance against all deferred tax assets has been recorded. Should the Company’s assessment change, tax benefits associated with the historic net operating loss carryforwards could be limited due to future ownership changes. |
Concentration of Credit Risk | Concentration of Credit Risk The Company maintains its cash balance in one financial institution. The balance is insured up to the maximum allowable by the Federal Deposit Insurance Corporation (“FDIC”). The Company has not experienced any losses in such accounts and does not believe it is exposed to any significant risk of loss on cash. At times, the cash balance may exceed the maximum insured limit of the FDIC. As of June 30, 2023, the Company had cash of approximately $9.1 million in U.S. bank accounts which was not fully insured by the FDIC. |
Research and Development | Research and Development The Company expenses research and development costs when incurred. At times, the Company may make cash advances for future research and development services. These amounts are deferred and expensed in the period the service is provided. The Company incurred research and development expenses in the amount of $1,736,386 and $911,692 for the three months ended June 30 2023 and 2022, respectively, and $2,751,969 and $1,730,580 for the six months ended June 30, 2023 and 2022, respectively. Costs for certain research and development activities, such as the provision of services for clinical trial activity, are estimated based on an evaluation of the progress to completion of specific tasks which may use data such as subject enrollment, clinical site activations or information provided to the Company by its vendors with respect to their actual costs incurred. Payments for these activities are based on the terms of the individual arrangements, which may differ from the pattern of costs incurred, and are reflected in the financial statements as prepaid or accrued research and development expense, as the case may be. The estimates are adjusted to reflect the best information available at the time of the financial statement issuance. The Company's estimate of the status and timing of services performed could differ from the actual status and timing of services performed. |
Share-Based Compensation | Share-Based Compensation The Company accounts for the cost of services performed by officers and directors received in exchange for an award of Company membership interests, common stock or stock options, based on the grant-date fair value of the award. The Company recognizes compensation expense based on the requisite service period. Compensation expense associated with stock option awards is recognized over the requisite service period based on the fair value of the option at the grant date determined based on the Black-Scholes option pricing model. Option valuation models require the input of highly subjective assumptions including the expected price volatility. The Company’s employee stock options have characteristics significantly different from those of traded options, and changes in the subjective input assumptions can materially affect the fair value computation using the Black-Scholes option pricing model. Because there is no public market for the Company’s stock options and very little historical experience with the Company’s stock, similar public companies were used for the comparison of volatility and the dividend yield. The risk-free rate of return was derived from U.S. Treasury notes with comparable maturities. |
Share-Based Payments to Vendors | Share-Based Payments to Vendors The Company accounts for the cost of services performed by vendors in exchange for an award of common stock, stock options, or warrants based on the grant-date fair value of the award or the fair value of the services rendered, whichever is more readily determinable. The Company recognizes the expense in the same period and in the same manner as if the Company had paid cash for the services. |
Major Vendor | Major Vendor The Company had a major vendor that accounted for approximately 75% and 25% of the research and development expenditures for the three months ended June 30, 2023 and 2022, respectively, and 70% and 36% for the six months ended June 30, 2023 and 2022, respectively. The same vendor also accounted for approximately 88% and 56% of the total accounts payable and accrued expenses as of June 30, 2023 and December 31, 2022, respectively. The Company continues to maintain this vendor relationship and anticipates incurring significant expenses with this vendor over the next 12 months. |
ACCOUNTS PAYABLE AND ACCRUED _2
ACCOUNTS PAYABLE AND ACCRUED EXPENSES (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
ACCOUNTS PAYABLE AND ACCRUED EXPENSES | |
Summary of accounts payable and accrued expenses | June 30, 2023 December 31, 2022 Accrued compensation expenses $ 35,887 $ 542,895 Accrued research and development 2,881,561 1,405,536 Accrued professional fees 89,081 83,715 Other accounts payable and accrued expenses 12,879 29,539 Total $ 3,019,408 $ 2,061,685 |
ISSUANCE OF EQUITY INTERESTS (T
ISSUANCE OF EQUITY INTERESTS (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
ISSUANCE OF EQUITY INTERESTS | |
Summary of outstanding warrants | Weighted Average Number of Warrants Exercise Price Balance at December 31, 2022 4,217,809 $ 3.29 Issued 3,398,148 2.56 Exercised (731,482) 0.0001 Balance at June 30, 2023 6,884,475 $ 3.28 |
SHARE-BASED COMPENSATION (Table
SHARE-BASED COMPENSATION (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
SHARE-BASED COMPENSATION | |
Schedule of fair value of options assumptions | Six Months Ended June 30, 2023 Expected term 6.90 years Volatility 98 % Dividend yield — % Risk-free interest rate 3.85 % Weighted average grant date fair value $ 2.75 |
Schedule of stock option activity | Six Months Ended Weighted Average June 30, 2023 Exercise Price Outstanding at the beginning of the period 2,467,500 $ 6.12 Granted 517,500 3.35 Exercised — — Forfeited — — Outstanding at the end of the period 2,985,000 $ 5.64 Exercisable 1,903,361 $ 6.07 |
NATURE OF OPERATIONS (Details)
NATURE OF OPERATIONS (Details) - USD ($) | 1 Months Ended | ||||||
May 18, 2023 | May 16, 2023 | Jul. 25, 2022 | Jun. 29, 2021 | Feb. 28, 2018 | Jun. 30, 2023 | Dec. 31, 2022 | |
Shares issued (in shares) | 601,851 | 1,159,211 | 2,875,000 | ||||
Gross proceeds stock issuance | $ 4,000,000 | $ 4,000,000 | $ 4,200,000 | $ 17,300,000 | |||
Share price (in dollars per share) | $ 6 | ||||||
Pre-funded Warrant Exercise (in shares) | 731,482 | 130,769 | |||||
Cash | $ 9,145,835 | $ 9,111,751 | |||||
Series A warrants | |||||||
Number of warrants | 1,289,980 | ||||||
Series B warrants | |||||||
Number of warrants | 1,289,980 | ||||||
Series C warrants | |||||||
Number of warrants | 1,333,333 | ||||||
Series D warrants | |||||||
Number of warrants | 1,333,333 | ||||||
Registered direct offering | |||||||
Warrant exercise price (in dollars per share) | $ 2.9999 | ||||||
Shares issued (in shares) | 601,851 | 1,159,211 | |||||
Share price (in dollars per share) | $ 3 | ||||||
Pre-funded Warrant Exercise (in shares) | 130,769 | ||||||
Number of warrants | 731,482 | ||||||
Private Placement | Series A warrants | |||||||
Number of warrants | 1,289,980 | ||||||
Private Placement | Series B warrants | |||||||
Number of warrants | 1,289,980 | ||||||
Private Placement | Series C warrants | |||||||
Warrant exercise price (in dollars per share) | $ 3.26 | ||||||
Number of warrants | 1,333,333 | ||||||
Private Placement | Series D warrants | |||||||
Warrant exercise price (in dollars per share) | $ 3.26 | ||||||
Number of warrants | 1,333,333 | ||||||
ACX362E | |||||||
Cash paid | $ 110,174 | ||||||
Future commitment | 700,000 | ||||||
Royalty payments | $ 50,000 | ||||||
Royalty payments on net sales (as a percent) | 4% | ||||||
ACX362E | Members' Equity, Class B | |||||||
Granting (in shares) | 100,000 | ||||||
Warrant exercise price (in dollars per share) | $ 0.10 |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||||
Effective tax rate | 0% | ||||
Current federal or state income tax expense | $ 0 | ||||
Cash | $ 9,145,835 | 9,145,835 | $ 9,111,751 | ||
Research and development expense | $ 1,736,386 | $ 911,692 | $ 2,751,969 | $ 1,730,580 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Major Vendor (Details) - Supplier Concentration Risk - Vendor One | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | |
Research and development expenditures | |||||
Concentration | |||||
Concentration Risk (as a percent) | 75% | 25% | 70% | 36% | |
Accounts payable and accrued expense | |||||
Concentration | |||||
Concentration Risk (as a percent) | 88% | 56% |
ACCOUNTS PAYABLE AND ACCRUED _3
ACCOUNTS PAYABLE AND ACCRUED EXPENSES (Details) - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
ACCOUNTS PAYABLE AND ACCRUED EXPENSES | ||
Accrued compensation expenses | $ 35,887 | $ 542,895 |
Accrued research and development | 2,881,561 | 1,405,536 |
Accrued professional fees | 89,081 | 83,715 |
Other accounts payable and accrued expenses | 12,879 | 29,539 |
Total | $ 3,019,408 | $ 2,061,685 |
ISSUANCE OF EQUITY INTERESTS (D
ISSUANCE OF EQUITY INTERESTS (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||||||
May 18, 2023 | May 16, 2023 | Jul. 25, 2022 | Jun. 29, 2021 | Jun. 30, 2023 | Jun. 30, 2023 | Dec. 31, 2022 | Jun. 23, 2021 | |
Equity | ||||||||
Common stock, Authorized (in shares) | 200,000,000 | 200,000,000 | 200,000,000 | 200,000,000 | ||||
Common stock, Outstanding (in shares) | 13,005,128 | 13,005,128 | 11,627,609 | |||||
Shares issued (in shares) | 601,851 | 1,159,211 | 2,875,000 | |||||
Purchase price (in dollars per share) | $ 6 | |||||||
Proceeds from Initial Public Offering, net of issuance costs | $ 14,800,000 | |||||||
Cash issuance cost | 2,400,000 | $ 456,314 | ||||||
Common stock, par value | $ 0.001 | $ 0.001 | $ 0.001 | |||||
Pre-funded Warrant Exercise (in shares) | 731,482 | 130,769 | ||||||
Gross proceeds stock issuance | $ 4,000,000 | $ 4,000,000 | $ 4,200,000 | $ 17,300,000 | ||||
Proceeds from stock issue, net of costs | $ 3,500,000 | $ 3,700,000 | $ 3,543,612 | |||||
Members' Equity, Class A and Class B | ||||||||
Equity | ||||||||
Converted to shares of common stock | 14,082,318 | |||||||
Converted shares of common stock | 7,041,208 | |||||||
Members' Equity, Class A | ||||||||
Equity | ||||||||
Number of warrants | 1,437,577 | |||||||
Warrant exercise price (in dollars per share) | $ 2.88 | |||||||
Series A warrants | ||||||||
Equity | ||||||||
Number of warrants | 1,289,980 | |||||||
Series B warrants | ||||||||
Equity | ||||||||
Number of warrants | 1,289,980 | |||||||
Series C warrants | ||||||||
Equity | ||||||||
Number of warrants | 1,333,333 | |||||||
Series D warrants | ||||||||
Equity | ||||||||
Number of warrants | 1,333,333 | |||||||
Underwriter | ||||||||
Equity | ||||||||
Number of warrants | 150,000 | |||||||
Warrant exercise price (in dollars per share) | $ 7.50 | |||||||
Warrants term | 4 years 6 months | |||||||
Registered direct offering | ||||||||
Equity | ||||||||
Shares issued (in shares) | 601,851 | 1,159,211 | ||||||
Purchase price (in dollars per share) | $ 3 | |||||||
Number of warrants | 731,482 | |||||||
Warrant exercise price (in dollars per share) | $ 2.9999 | |||||||
Pre-funded Warrant Exercise (in shares) | 130,769 | |||||||
Registered direct offering | Affiliate Investors | ||||||||
Equity | ||||||||
Shares issued (in shares) | 59,211 | |||||||
Purchase price (in dollars per share) | $ 3.80 | |||||||
Warrant exercise price (in dollars per share) | $ 3.55 | |||||||
Registered direct offering | Investor | ||||||||
Equity | ||||||||
Shares issued (in shares) | 1,100,000 | |||||||
Purchase price (in dollars per share) | $ 3.25 | |||||||
Warrant exercise price (in dollars per share) | $ 0.0001 | $ 3.2499 | ||||||
Pre-funded Warrant Exercise (in shares) | 130,769 | |||||||
Warrant exercise price, exercised (in dollars per share) | $ 0.0001 | |||||||
Private Placement | Series A warrants | ||||||||
Equity | ||||||||
Number of warrants | 1,289,980 | |||||||
Private Placement | Series B warrants | ||||||||
Equity | ||||||||
Number of warrants | 1,289,980 | |||||||
Private Placement | Series C warrants | ||||||||
Equity | ||||||||
Number of warrants | 1,333,333 | |||||||
Warrant exercise price (in dollars per share) | $ 3.26 | |||||||
Private Placement | Series D warrants | ||||||||
Equity | ||||||||
Number of warrants | 1,333,333 | |||||||
Warrant exercise price (in dollars per share) | $ 3.26 | |||||||
Private Placement | SeriesA and Series B Warrants | ||||||||
Equity | ||||||||
Warrants fair value increase adjustment | $ 2,000,000 | |||||||
Private Placement | Affiliate Investors | Series A warrants | ||||||||
Equity | ||||||||
Number of warrants | 59,211 | |||||||
Private Placement | Affiliate Investors | Series B warrants | ||||||||
Equity | ||||||||
Number of warrants | 59,211 | |||||||
Private Placement | Investor | Series A warrants | ||||||||
Equity | ||||||||
Number of warrants | 1,230,769 | |||||||
Private Placement | Investor | Series B warrants | ||||||||
Equity | ||||||||
Number of warrants | 1,230,769 | |||||||
Warrant exercise price (in dollars per share) | $ 3.25 | |||||||
Placement Agents | ||||||||
Equity | ||||||||
Cash issuance cost | $ 287,874 | |||||||
Number of warrants | 63,018 | |||||||
Warrant exercise price (in dollars per share) | $ 3.60 | |||||||
Weighted average aggregate offering price (as a percent) | 110% |
ISSUANCE OF EQUITY INTERESTS -
ISSUANCE OF EQUITY INTERESTS - Fair Value (Details) | Jul. 25, 2022 USD ($) Y $ / shares | Jun. 29, 2021 USD ($) Y $ / shares |
Underwriter | ||
Warrants fair value | ||
Fair value of Warrants | $ 618,000 | |
Underwriter | Measurement Input, Expected Term | ||
Warrants fair value | ||
Measurement Input, Warrants | Y | 4.5 | |
Underwriter | Measurement Input, Risk Free Rate | ||
Warrants fair value | ||
Measurement Input, Warrants | 0.0079 | |
Underwriter | Measurement Input, Share Price | ||
Warrants fair value | ||
Measurement Input, Warrants | $ / shares | 6.26 | |
Underwriter | Measurement Input, Volatility | ||
Warrants fair value | ||
Measurement Input, Warrants | 0.94 | |
Placement Agents | ||
Warrants fair value | ||
Fair value of Warrants | $ 171,409 | |
Placement Agents | Measurement Input, Expected Term | ||
Warrants fair value | ||
Measurement Input, Warrants | Y | 5 | |
Placement Agents | Measurement Input, Risk Free Rate | ||
Warrants fair value | ||
Measurement Input, Warrants | 0.0282 | |
Placement Agents | Measurement Input, Share Price | ||
Warrants fair value | ||
Measurement Input, Warrants | $ / shares | 3.70 | |
Placement Agents | Measurement Input, Volatility | ||
Warrants fair value | ||
Measurement Input, Warrants | 0.95 |
ISSUANCE OF EQUITY INTERESTS _2
ISSUANCE OF EQUITY INTERESTS - Warrants outstanding (Details) - $ / shares | 6 Months Ended | |
Jun. 30, 2023 | Dec. 31, 2022 | |
Equity | ||
Warrants outstanding (in shares), beginning balance | 4,217,809 | |
Warrants issued (in shares) | 3,398,148 | |
Warrants exercised (in shares) | (731,482) | |
Warrants outstanding (in shares), ending balance | 6,884,475 | |
Weighted Average | ||
Equity | ||
Warrant exercise price, outstanding (in dollars per share) | $ 3.28 | $ 3.29 |
Warrant exercise price, issued (in dollars per share) | 2.56 | |
Warrant exercise price, exercised (in dollars per share) | $ 0.0001 | |
Warrants term | 5 years 21 days |
SHARE-BASED COMPENSATION - (Det
SHARE-BASED COMPENSATION - (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||||||||
Jun. 30, 2023 | Feb. 28, 2023 | Apr. 30, 2022 | Jan. 31, 2022 | Jul. 31, 2021 | Jun. 30, 2021 | Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Apr. 30, 2021 | |
Share-based compensation | |||||||||||
Stock options granted (in shares) | 517,500 | ||||||||||
Grant exercise price (in dollars per share) | $ 3.35 | ||||||||||
Total compensation expense not yet recognized | $ 4,125,421 | $ 4,125,421 | $ 4,125,421 | ||||||||
Weighted average vesting period | 1 year 7 months 20 days | ||||||||||
Intrinsic value of stock option | $ 0 | 0 | $ 0 | ||||||||
Weighted average contractual life | 8 years 3 months 21 days | ||||||||||
June 2021 | |||||||||||
Share-based compensation | |||||||||||
Share based compensation expense | 181,720 | $ 363,440 | $ 181,720 | $ 363,440 | |||||||
Common stock shares available (in shares) | 807,500 | ||||||||||
Grant exercise price (in dollars per share) | $ 6.26 | ||||||||||
June 2021 | Employee | Tranche one | |||||||||||
Share-based compensation | |||||||||||
Vesting percentage | 40% | ||||||||||
June 2021 | Employee | Tranche two | |||||||||||
Share-based compensation | |||||||||||
Vesting term of options | 36 months | ||||||||||
July 2021 | |||||||||||
Share-based compensation | |||||||||||
Share based compensation expense | 490,916 | 981,833 | 490,916 | 981,833 | |||||||
Stock options granted (in shares) | 1,550,000 | ||||||||||
Grant exercise price (in dollars per share) | $ 6.18 | ||||||||||
July 2021 | Executive officers | Tranche one | |||||||||||
Share-based compensation | |||||||||||
Vesting percentage | 25% | ||||||||||
July 2021 | Executive officers | Tranche two | |||||||||||
Share-based compensation | |||||||||||
Vesting term of options | 36 months | ||||||||||
July 2021 | Independent Directors, Consultant | |||||||||||
Share-based compensation | |||||||||||
Vesting term of options | 36 months | ||||||||||
January 2022 | |||||||||||
Share-based compensation | |||||||||||
Share based compensation expense | 18,950 | 18,950 | 37,900 | 107,373 | |||||||
Stock options granted (in shares) | 80,000 | ||||||||||
Grant exercise price (in dollars per share) | $ 4.44 | ||||||||||
January 2022 | Tranche one | |||||||||||
Share-based compensation | |||||||||||
Vesting percentage | 25% | ||||||||||
January 2022 | Tranche two | |||||||||||
Share-based compensation | |||||||||||
Vesting term of options | 36 months | ||||||||||
April 2022 | |||||||||||
Share-based compensation | |||||||||||
Share based compensation expense | 5,378 | $ 25,095 | 10,755 | $ 25,095 | |||||||
Stock options granted (in shares) | 30,000 | ||||||||||
Grant exercise price (in dollars per share) | $ 3.79 | ||||||||||
April 2022 | Tranche one | |||||||||||
Share-based compensation | |||||||||||
Vesting percentage | 25% | ||||||||||
April 2022 | Tranche two | |||||||||||
Share-based compensation | |||||||||||
Vesting term of options | 36 months | ||||||||||
February 2023 | |||||||||||
Share-based compensation | |||||||||||
Share based compensation expense | 109,521 | 146,028 | |||||||||
Stock options granted (in shares) | 467,500 | ||||||||||
Grant exercise price (in dollars per share) | $ 3.41 | ||||||||||
Vesting term of options | 36 months | ||||||||||
June 2023 | |||||||||||
Share-based compensation | |||||||||||
Share based compensation expense | $ 0 | $ 0 | |||||||||
Stock options granted (in shares) | 50,000 | ||||||||||
Grant exercise price (in dollars per share) | $ 2.75 | ||||||||||
Vesting term of options | 1 year | ||||||||||
2021 Equity Incentive Plan | |||||||||||
Share-based compensation | |||||||||||
Common stock shares reserved | 2,874,063 | ||||||||||
Common stock shares available (in shares) | 485,868 | 485,868 | 485,868 |
SHARE-BASED COMPENSATION - Opti
SHARE-BASED COMPENSATION - Option pricing (Details) | 6 Months Ended |
Jun. 30, 2023 $ / shares | |
SHARE-BASED COMPENSATION | |
Expected term | 6 years 10 months 24 days |
Volatility | 98% |
Risk-free interest rate | 3.85% |
Weighted average grant date fair value | $ 2.75 |
SHARE-BASED COMPENSATION - Op_2
SHARE-BASED COMPENSATION - Option activity (Details) - $ / shares | 6 Months Ended |
Jun. 30, 2023 | |
Options outstanding | |
Outstanding at the beginning of the period | 2,467,500 |
Granted | 517,500 |
Outstanding at the end of the period | 2,985,000 |
Exercisable | 1,903,361 |
Weighted Average Exercise Price | |
Weighted Average Exercise price, Beginning of the period | $ 6.12 |
Weighted Average Exercise price, granted | 3.35 |
Weighted Average Exercise price, End of the period | 5.64 |
Exercisable | $ 6.07 |
SHARE-BASED PAYMENTS TO VENDO_2
SHARE-BASED PAYMENTS TO VENDORS (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||||||
Jan. 31, 2022 | Jun. 30, 2023 | Mar. 31, 2023 | Dec. 31, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | Jun. 30, 2023 | Jun. 30, 2022 | |
Share-based compensation | |||||||||
Share-based vendor payments | $ 165,903 | $ 188,100 | |||||||
Warrants outstanding (in shares) | 6,884,475 | 4,217,809 | 6,884,475 | ||||||
Fourth Quarter 2021 | |||||||||
Share-based compensation | |||||||||
Share-based vendor payments (in shares) | 13,889 | ||||||||
Share-based vendor payments | $ 0 | $ 0 | $ 0 | 75,000 | |||||
Contract term | 6 months | ||||||||
Future commitment | $ 150,000 | ||||||||
First Quarter 2022 | |||||||||
Share-based compensation | |||||||||
Share-based vendor payments (in shares) | 30,000 | ||||||||
Share-based vendor payments | 0 | $ 0 | 0 | $ 113,100 | |||||
Grant date fair value ($ per share) | $ 3.77 | ||||||||
Vendor payment | $ 25,000 | ||||||||
Contract term | 6 months | ||||||||
Fourth Quarter 2022 | |||||||||
Share-based compensation | |||||||||
Share-based vendor payments (in shares) | 43,186 | ||||||||
Share-based vendor payments | 0 | 46,742 | |||||||
Contract term | 6 months | ||||||||
Warrants outstanding (in shares) | 10,096 | ||||||||
Fourth Quarter 2022 | Minimum | |||||||||
Share-based compensation | |||||||||
Grant date fair value ($ per share) | $ 3.30 | ||||||||
Fourth Quarter 2022 | Maximum | |||||||||
Share-based compensation | |||||||||
Grant date fair value ($ per share) | $ 3.67 | ||||||||
First Quarter 2023 | |||||||||
Share-based compensation | |||||||||
Share-based vendor payments (in shares) | 36,000 | ||||||||
Share-based vendor payments | $ 0 | $ 119,160 | |||||||
Grant date fair value ($ per share) | $ 3.31 | ||||||||
Contract term | 6 months |
NET LOSS PER SHARE (Details)
NET LOSS PER SHARE (Details) | 6 Months Ended |
Jun. 30, 2023 shares | |
Warrant | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |
Potentially dilutive shares | 6,884,475 |
Stock Options | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |
Potentially dilutive shares | 2,985,000 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) - ACX362E | 1 Months Ended |
Feb. 28, 2018 USD ($) | |
Contingency | |
Future commitment | $ 700,000 |
Royalty payments | $ 50,000 |
Royalty payments on net sales (as a percent) | 4% |