Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2020 | Nov. 05, 2020 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2020 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q3 | |
Entity Registrant Name | Baudax Bio, Inc. | |
Entity Central Index Key | 0001780097 | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 26,238,825 | |
Entity Shell Company | false | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | true | |
Trading Symbol | BXRX | |
Entity File Number | 001-39101 | |
Entity Tax Identification Number | 47-4639500 | |
Entity Address, Address Line One | 490 Lapp Road | |
Entity Address, City or Town | Malvern | |
City Area Code | 484 | |
Local Phone Number | 395-2440 | |
Entity Address, Postal Zip Code | 19355 | |
Entity Address, State or Province | PA | |
Entity Incorporation, State or Country Code | PA | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity Interactive Data Current | Yes | |
Security Exchange Name | NASDAQ | |
Title of 12(b) Security | Common Stock, par value $0.01 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 24,608 | $ 17,740 |
Inventory | 1,784 | |
Prepaid expenses and other current assets | 2,563 | 2,395 |
Total current assets | 28,955 | 20,135 |
Property, plant and equipment, net | 4,835 | 4,821 |
Intangible assets, net | 24,898 | 26,400 |
Goodwill | 2,127 | 2,127 |
Other long-term assets | 652 | 730 |
Total assets | 61,467 | 54,213 |
Current liabilities: | ||
Accounts payable | 1,782 | 271 |
Accrued expenses and other current liabilities | 7,292 | 3,850 |
Current portion of long-term debt, net | 171 | |
Current portion of contingent consideration | 10,677 | 3,592 |
Total current liabilities | 19,922 | 7,713 |
Long-term debt, net | 8,753 | |
Warrant liability | 10,228 | |
Long-term portion of contingent consideration | 67,433 | 62,766 |
Other long-term liabilities | 361 | 455 |
Total liabilities | 106,697 | 70,934 |
Commitments and contingencies (Note 12) | ||
Shareholders’ equity: | ||
Preferred stock, $0.01 par value. Authorized, 10,000,000 shares; none issued and outstanding | ||
Common stock, $0.01 par value. Authorized, 100,000,000 shares; issued and outstanding, 18,374,604 shares at September 30, 2020 and 9,350,709 shares at December 31, 2019 | 184 | 94 |
Additional paid-in capital | 49,864 | 19,405 |
Accumulated deficit | (95,278) | (36,220) |
Total shareholders’ equity (deficit) | (45,230) | (16,721) |
Total liabilities and shareholders’ equity | $ 61,467 | $ 54,213 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2020 | Dec. 31, 2019 | Nov. 20, 2019 |
Statement Of Financial Position [Abstract] | |||
Preferred stock, par value | $ 0.01 | $ 0.01 | |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 | |
Preferred stock, shares issued | 0 | 0 | |
Preferred stock, shares outstanding | 0 | 0 | |
Common stock, par value | $ 0.01 | $ 0.01 | |
Common stock, shares authorized | 100,000,000 | 100,000,000 | |
Common stock, shares issued | 18,374,604 | 9,350,709 | |
Common stock, shares outstanding | 18,374,604 | 9,350,709 | 0 |
Combined Statements of Operatio
Combined Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Income Statement [Abstract] | ||||
Revenue, net | $ 68,000 | $ 417,000 | ||
Operating expenses: | ||||
Cost of sales | 540,000 | 1,190,000 | ||
Research and development | 1,469,000 | $ 1,845,000 | 5,889,000 | $ 18,578,000 |
Selling, general and administrative | 13,763,000 | 4,524,000 | 33,026,000 | 21,809,000 |
Amortization of intangible assets | 643,000 | 0 | 1,502,000 | 0 |
Change in warrant valuation | (11,182,000) | 2,863,000 | ||
Change in contingent consideration valuation | (17,427,000) | 3,909,000 | 14,252,000 | (15,241,000) |
Total operating expenses | (12,194,000) | 10,278,000 | 58,722,000 | 25,146,000 |
Operating income (loss) | 12,262,000 | (10,278,000) | (58,305,000) | (25,146,000) |
Other expense: | ||||
Other expense | (577,000) | (37,000) | (753,000) | (86,000) |
Net income (loss) | $ 11,685,000 | $ (10,315,000) | $ (59,058,000) | $ (25,232,000) |
Per share information: | ||||
Net income (loss) per share of common stock, basic | $ 0.64 | $ (1.10) | $ (3.84) | $ (2.70) |
Net income (loss) per share of common stock, dilutive | $ 0.62 | $ (1.10) | $ (3.84) | $ (2.70) |
Weighted average common shares outstanding, basic | 18,374,604 | 9,350,709 | 15,366,861 | 9,350,709 |
Weighted average common shares outstanding, diluted | 18,768,376 | 9,350,709 | 15,366,861 | 9,350,709 |
Consolidated and Combined State
Consolidated and Combined Statements of Shareholders' Equity (Unaudited) - USD ($) $ in Thousands | Total | Public Offering | Equity Facility | Separation | Recro | Common Stock | Common StockPublic Offering | Common StockEquity Facility | Common StockSeparation | Additional Paid in Capital | Additional Paid in CapitalPublic Offering | Additional Paid in CapitalEquity Facility | Additional Paid in CapitalRecro | Accumulated Deficit |
Balance at Dec. 31, 2018 | $ (68,347) | |||||||||||||
Net income (loss) | (4,335) | |||||||||||||
Net transfer from parent | 19,823 | |||||||||||||
Parent allocation - share-based compensation | 1,527 | |||||||||||||
Balance at Mar. 31, 2019 | (51,332) | |||||||||||||
Balance at Dec. 31, 2018 | (68,347) | |||||||||||||
Net income (loss) | (25,232) | |||||||||||||
Balance at Sep. 30, 2019 | (35,423) | |||||||||||||
Balance at Mar. 31, 2019 | (51,332) | |||||||||||||
Net income (loss) | (10,582) | |||||||||||||
Net transfer from parent | 31,052 | |||||||||||||
Parent allocation - share-based compensation | 1,675 | |||||||||||||
Balance at Jun. 30, 2019 | (29,187) | |||||||||||||
Net income (loss) | (10,315) | |||||||||||||
Net transfer from parent | 3,027 | |||||||||||||
Parent allocation - share-based compensation | 1,052 | |||||||||||||
Balance at Sep. 30, 2019 | (35,423) | |||||||||||||
Balance at Dec. 31, 2019 | (16,721) | $ 94 | $ 19,405 | $ (36,220) | ||||||||||
Balance, Shares at Dec. 31, 2019 | 9,350,709 | |||||||||||||
Stock-based compensation expense | 2,177 | $ 456 | 2,177 | $ 456 | ||||||||||
Issuance of common stock | $ 14,976 | $ 3,612 | $ 1 | $ 77 | $ 4 | $ 1 | $ 14,899 | $ 3,608 | ||||||
Issuance of common stock, Shares | 7,692,308 | 441,967 | 45,874 | |||||||||||
Issuance of restricted stock units, net of shares withheld for income taxes | (95) | (95) | ||||||||||||
Issuance of restricted stock units, net of shares withheld for income taxes, Shares | 39,130 | |||||||||||||
Net income (loss) | (40,298) | (40,298) | ||||||||||||
Balance at Mar. 31, 2020 | (35,892) | $ 176 | 40,450 | (76,518) | ||||||||||
Balance, Shares at Mar. 31, 2020 | 17,569,988 | |||||||||||||
Balance at Dec. 31, 2019 | (16,721) | $ 94 | 19,405 | (36,220) | ||||||||||
Balance, Shares at Dec. 31, 2019 | 9,350,709 | |||||||||||||
Net income (loss) | (59,058) | |||||||||||||
Balance at Sep. 30, 2020 | (45,230) | $ 184 | 49,864 | (95,278) | ||||||||||
Balance, Shares at Sep. 30, 2020 | 18,374,604 | |||||||||||||
Balance at Mar. 31, 2020 | (35,892) | $ 176 | 40,450 | (76,518) | ||||||||||
Balance, Shares at Mar. 31, 2020 | 17,569,988 | |||||||||||||
Stock-based compensation expense | 1,864 | 445 | 1,864 | 445 | ||||||||||
Stock issuance costs | (3) | (3) | ||||||||||||
Warrants issued in connection with financing facility | 1,423 | 1,423 | ||||||||||||
Exercise of warrants | 3,204 | $ 8 | 3,196 | |||||||||||
Exercise of warrants, Shares | 804,616 | |||||||||||||
Net income (loss) | (30,445) | (30,445) | ||||||||||||
Balance at Jun. 30, 2020 | (59,404) | $ 184 | 47,375 | (106,963) | ||||||||||
Balance, Shares at Jun. 30, 2020 | 18,374,604 | |||||||||||||
Stock-based compensation expense | 2,045 | $ 444 | 2,045 | $ 444 | ||||||||||
Net income (loss) | 11,685 | 11,685 | ||||||||||||
Balance at Sep. 30, 2020 | $ (45,230) | $ 184 | $ 49,864 | $ (95,278) | ||||||||||
Balance, Shares at Sep. 30, 2020 | 18,374,604 |
Consolidated and Combined Sta_2
Consolidated and Combined Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2020 | Sep. 30, 2019 | |
Cash flows from operating activities: | |||
Net loss | $ (59,058,000) | $ (25,232,000) | |
Adjustments to reconcile net loss to net cash used in operating activities: | |||
Stock-based compensation | 7,431,000 | 4,254,000 | |
Non-cash interest expense | 306,000 | ||
Depreciation expense | $ 104,000 | 315,000 | 369,000 |
Amortization | 643,000 | 1,502,000 | 0 |
Change in warrant valuation | (11,182,000) | 2,863,000 | |
Change in contingent consideration valuation | (17,427,000) | 14,252,000 | (15,241,000) |
Changes in operating assets and liabilities: | |||
Inventory | (1,784,000) | ||
Prepaid expenses and other current assets | (90,000) | 1,199,000 | |
Accounts payable, accrued expenses and other liabilities | 4,837,000 | (7,453,000) | |
Net cash used in operating activities | (29,426,000) | (42,104,000) | |
Cash flows from investing activities: | |||
Purchase of property and equipment | (307,000) | (1,633,000) | |
Acquisition of license agreement | (165,000) | ||
Net cash used in investing activities | (307,000) | (1,798,000) | |
Cash flows from financing activities: | |||
Proceeds from issuance of long-term debt, net of transaction costs | 10,041,000 | ||
Proceeds from public offering, net of transaction costs | 23,085,000 | ||
Proceeds from equity facility, net of transaction costs | 3,612,000 | ||
Proceeds from warrant exercises | 2,458,000 | ||
Investment from parent company | 53,902,000 | ||
Payments of withholdings on shares withheld for income taxes | (95,000) | ||
Payment of contingent consideration | (2,500,000) | (10,000,000) | |
Net cash provided by financing activities | 36,601,000 | $ 43,902,000 | |
Net increase in cash and cash equivalents | 6,868,000 | ||
Cash and cash equivalents, beginning of period | 17,740,000 | ||
Cash and cash equivalents, end of period | $ 24,608,000 | 24,608,000 | |
Supplemental disclosure of cash flow information: | |||
Purchase of property, plant and equipment included in accrued expenses and accounts payable | 22,000 | ||
Fair value of warrants issued in connection with public offering | 8,111,000 | ||
Fair value of warrants issued in connection with financing facility | $ 1,423,000 |
Background
Background | 9 Months Ended |
Sep. 30, 2020 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Background | (1) Background Business Baudax Bio, Inc. (“Baudax Bio” or the “Company”) is a pharmaceutical company primarily focused on developing and commercializing innovative products for acute care settings. Baudax Bio believes it can bring valuable therapeutic options for patients, prescribers and payers, such as its lead product, ANJESO ® On February 20, 2020, the Company announced that the U.S. Food and Drug Administration (“FDA”) approved the New Drug Application (“NDA”) for ANJESO, which is indicated for the management of moderate to severe pain, alone or in combination with other non-NSAID analgesics. On June 15, 2020, Baudax Bio announced the commercial launch of ANJESO and that the Centers for Medicare and Medicaid Services (“CMS”) approved transitional pass-through status and established a new reimbursement C-code for ANJESO. On August 6, 2020, the Company announced CMS established a new permanent J-code for ANJESO facilitating reimbursement in the hospital outpatient, ambulatory surgery center and physician office settings of care. The code, J1738 (Injection, meloxicam, 1 mg), took effect on October 1, 2020 and replaced the previously issued C-code. The Separation Pursuant to the Separation Agreement between Recro Pharma, Inc. (“Recro”) and Baudax Bio, Recro transferred the assets, liabilities, and operations of its Acute Care business to the Company (the “Separation”) and, on November 21, 2019, the distribution date, each Recro shareholder received one share of the Company’s common stock for every two and one-half Basis of Presentation Related to the Separation For all periods prior to the Separation, the accompanying combined financial statements represent the Acute Care Business of Recro and are derived from Recro’s consolidated financial statements. The Acute Care Business of Recro did not consist of a separate, standalone group of legal entities for public company reporting and certain other corporate functions in the periods prior to the Separation and, accordingly, allocations were required through the Distribution date. These combined financial statements, prior to the Separation, reflect the Company’s historical financial position, results of operations and cash flows as the business was operated as part a description of the agreements entered into between Recro and Baudax Bio following the Separation. Prior to the Separation, the combined financial statements include certain assets and liabilities that had historically been held at the Recro corporate level, but which were specifically identifiable or allocable to the Company. All intracompany transactions and accounts have been eliminated. All intercompany transactions between the Company and Recro are considered to be effectively settled in the combined financial statements at the time the transaction was recorded. The total net effect of the settlement of these intercompany transactions was reflected in the combined statements of cash flows as a financing activity and in the combined balance sheet as parent company net investment. The Company did not record interest expense on amounts funded by Recro. Long-term debt held at the Recro corporate level was retained by Recro and was not assumed by the Company. Historically, certain corporate level activity costs have been incurred and reported within the legal entity that includes the Recro Acute Care Business. The Company’s combined financial statements, prior to the Separation, include an allocation of these expenses related to these certain Recro corporate functions, including senior management, legal, human resources, finance, and information technology through the distribution date. These expenses are included in selling, general and administrative expense and have been allocated based on direct usage or benefit where identifiable, with the remainder allocated on a pro rata basis of expenses, headcount, or other measures. The Company considers the expense allocation methodology and results to be reasonable for all periods presented prior to the Separation, however, the allocations may not be indicative of the actual expense that would have been incurred had the Company operated as an independent, publicly-traded company for the periods presented prior to the Separation. For the three and nine months ended September 30, 2019, a total of $1,516 and $6,467, respectively, of these The income tax amounts in the combined financial statements for periods prior to the Separation have been calculated based on a separate return methodology and are presented as if the Company was a standalone taxpayer in each of its tax jurisdictions prior to the Separation. Because of the Company’s history of losses as a standalone entity, a full valuation allowance is recorded against deferred tax assets in all periods presented. Upon the Separation, the Company adopted its own share‑based compensation plan. Recro maintains its stock-based compensation plan at a corporate level. Certain of the Company’s employees participated in Recro’s stock-based compensation plans prior to the Separation and a portion of the cost of those plans is included in the Company’s combined financial statements using an allocation methodology similar to the methodology used to allocate the cash compensation of the related employees. The parent company net investment balances in these combined financial statements represents the accumulated deficit of the Recro Acute Care Business and the net funding provided to the Company, which are reflected as net transfers from parent in the Combined Statements of Parent Company Net Investment prior to the Separation. Subsequent to the Separation, the accompanying consolidated financial statements are presented on a consolidated basis and include all of the accounts and operations of Baudax Bio and its subsidiaries. The consolidated financial statements reflect the financial position, results of operations and cash flows of Baudax Bio in accordance with U.S. GAAP. All significant intercompany accounts and transactions are eliminated in consolidation. The Company has determined that it operates in a single segment involved in the commercialization and development of innovative products for hospital and other acute care settings. |
Development-Stage Risks and Liq
Development-Stage Risks and Liquidity | 9 Months Ended |
Sep. 30, 2020 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Development-Stage Risks and Liquidity | (2) Development-Stage Risks and Liquidity The Company has incurred losses from operations since inception and has an accumulated deficit of $95,278 as of September 30, 2020. The Company has a history of operating losses and negative cash flows while operating as part of Recro and, accordingly, was dependent upon Recro for its capital funding and liquidity needs. Recro contributed $19,000 to the Company immediately prior to the Distribution. Recro has not committed any additional funding to the Company beyond the $19,000 that was contributed as of the Distribution date. The Company has raised additional funds from debt and equity transactions as a standalone entity and will be required to raise additional funds to continue to operate as a standalone entity. The Company’s ability to generate cash inflows is highly dependent on the commercialization of ANJESO and there can be no assurance that ANJESO can be successfully commercialized. In addition, development activities, clinical and pre-clinical testing and, if approved, commercialization of the Company’s other product candidates, will require significant additional funding. The Company could delay clinical trial activity or reduce funding of specific programs in order to reduce cash needs. Insufficient funds may cause the Company to delay, reduce the scope of or eliminate one or more of its development, commercialization, or expansion activities. The Company may raise such funds, if available, through debt financings, bank or other loans, through strategic research and development, licensing (including out-licensing) and/or marketing arrangements or through public or private sales of equity or debt securities from time to time. Financing may not be available on acceptable terms, or at all, and failure to raise capital when needed could materially adversely impact the Company’s growth plans and its financial condition or results of operations. Additional debt or equity financing, if available, may be dilutive to holders of the Company’s common stock and may involve significant cash payment obligations and covenants that restrict the Company’s ability to operate its business. The Company follows the provisions of Financial Accounting Standards Board (“FASB”), Accounting Standards Codification (“ASC”), Topic 205-40, “Presentation of Financial Statements — Going Concern” |
Summary of Significant Accounti
Summary of Significant Accounting Principles | 9 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Principles | (3) Summary of Significant Accounting Principles (a) Basis of Presentation The accompanying unaudited consolidated and combined financial statements of the Company and its subsidiaries have been prepared in accordance with U.S. GAAP, for interim financial information and with the instructions of Form 10-Q and Article 10 of Regulation S-X and, therefore, do not include all of the information and notes required by U.S. GAAP for complete annual financial statements. In the opinion of management, the accompanying consolidated and combined financial statements include all normal and recurring adjustments (which consist primarily of accruals, estimates and assumptions that impact the financial statements) considered necessary to present fairly the Company’s results for the interim periods. Operating results for the three and nine months ended September 30, 2020 are not necessarily indicative of the results that may be expected for the full year ending December 31, 2020 . The accompanying unaudited interim (b) Use of Estimates The preparation of financial statements and the notes to the financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from such estimates. (c) Cash and Cash Equivalents Cash and cash equivalents represent cash in banks and highly liquid short-term investments that have maturities of three months or less when acquired. These highly liquid short-term investments are both readily convertible to known amounts of cash and so near to their maturity that they present insignificant risk of changes in value because of the changes in interest rates. (d) Property and Equipment Property and equipment are recorded at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the assets, which are as follows: three to seven years for furniture and office equipment; six to ten years for manufacturing equipment; and the shorter of the lease term or useful life for leasehold improvements. Repairs and maintenance costs are expensed as incurred. (e) Business Combinations In accordance with FASB ASC Topic 805, “ Business Combinations (f) Goodwill and Intangible Assets Goodwill represents the excess of purchase price over the fair value of net assets acquired by the Company. Goodwill is not amortized but assessed for impairment on an annual basis or more frequently if impairment indicators exist. The impairment model prescribes a one-step method for determining impairment. The one-step quantitative test calculates the amount of goodwill impairment as the excess of a reporting unit’s carrying amount over its fair value, not to exceed the total amount of goodwill allocated to the reporting unit. The Company has one reporting unit. As of September 30, 2020, the Company’s intangible asset is classified as an asset resulting from R&D activities. Historically, prior to receiving FDA approval, the intangible asset was classified as an IPR&D asset. Intangible assets related to IPR&D are considered indefinite-lived intangible assets and are assessed for impairment annually or more frequently if impairment indicators exist. If the associated research and development effort is abandoned, the related assets will be written-off, and the Company will record a noncash impairment loss on its Combined Statements of Operations. For those compounds that reach commercialization, the IPR&D assets will be amortized over their estimated useful lives The Company performs its annual goodwill impairment test as of November 30 th (g) Revenue Recognition Subsequent to regulatory approval for ANJESO from the FDA, the Company began selling ANJESO in the U.S. through a single third-party logistics provider (“3PL”) which takes title to and control of the goods. The Company recognizes revenue from ANJESO product sales at the point the title to the product is transferred to the customer and the customer obtains control of the product. The transaction price that is recognized as revenue for products includes an estimate of variable consideration for reserves, which result from discounts, returns, chargebacks, rebates and other allowances that are offered within contracts between us and our end-customers, wholesalers, group purchasing organizations and other indirect customers. Our payment terms are generally between thirty to ninety days. The Company’s estimates of variable consideration and determination of whether to include estimated amounts in the transaction price are based largely on an assessment of its anticipated performance and all information (historical, current and forecasted) that is reasonably available. These reserves reflect the Company’s best estimate of the amount of consideration to which the Company is entitled based on the terms of the contracts. The amount of variable consideration that is included in the transaction price may be constrained and is included in the net sales price only to the extent that is considered probable that a significant reversal in the amount of the cumulative revenue recognized will not occur in a future period. Actual amounts of consideration ultimately received may differ from the Company’s estimates. If actual results in the future vary from the Company’s estimates, the Company will adjust these estimates, which would affect net product revenue and earnings in the period such variances become known. ( h ) Concentration of Credit Risk Financial instruments that potentially subject the Company to significant concentration of credit risk consist primarily of cash, cash equivalents and accounts receivable. The Company manages its cash and cash equivalents based on established guidelines relative to diversification and maturities to maintain safety and liquidity. The Company’s accounts receivable balance is compromised solely from transactions with the Company’s 3PL. ( i ) Research and Development Research and development costs for the Company’s proprietary products/product candidates are charged to expense as incurred. Research and development expenses consist primarily of funds paid to third parties for the provision of services for pre-commercialization and manufacturing scale-up activities, drug development, pre-clinical activities, clinical trials, statistical analysis and report writing and regulatory filing fees and compliance costs. 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 expenses relating to these costs. Upfront and milestone payments made to third parties who perform research and development services on the Company’s behalf are expensed as services are rendered. Costs incurred in obtaining product technology licenses are charged to research and development expense as acquired IPR&D if the technology licensed has not reached technological feasibility and has no alternative future use. ( j ) Stock-Based Awards Baudax Awards Share-based compensation included in the consolidated financial statements following the Separation is based upon the Baudax Bio, Inc. 2019 Equity Incentive Plan (the “2019 Plan”). The plan includes grants of stock options, time-based vesting restricted stock units (“RSUs”) and performance-based RSUs. The Company measures employee stock-based awards at grant-date fair value and recognizes employee compensation expense on a straight-line basis over the vesting period of the award. The Company accounts for forfeitures as they occur. Determining the appropriate fair value of stock options requires the input of subjective assumptions, including the expected life of the option and expected stock price volatility. The Company uses the Black-Scholes option pricing model to value its stock option awards. The assumptions used in calculating the fair value of stock-based awards represent management’s best estimates and involve inherent uncertainties and the application of management’s judgment. As a result, if factors change and/or management uses different assumptions, stock-based compensation expense could be materially different for future awards. The expected life of stock options was estimated using the “simplified method,” as the Company has limited historical information to develop reasonable expectations about future exercise patterns and post-vesting employment termination behavior for its stock options grants. The simplified method is based on the average of the vesting tranches and the contractual life of each grant. For stock price volatility, the Company uses an average of its peer group’s volatility in order to estimate future stock price trends. The risk-free interest rate is based on U.S. Treasury notes with a term approximating the expected life of the option. Recro Awards The Recro Pharma, Inc. 2018 Amended and Restated Equity Incentive Plan (the “Recro Equity Plan”) includes stock options, time-based vesting RSUs and performance-based vesting RSUs granted to the Company’s employees prior to the Separation. The consolidated and combined financial statements reflect share-based compensation expense based on an allocation of a portion of Recro share-based compensation issued to the Company’s employees based on where their services are performed. Recro measures employee stock-based awards at grant-date fair value and recognizes employee compensation expense on a straight-line basis over the vesting period of the award. Forfeitures are accounted for as they occur. Determining the appropriate fair value of stock options requires the input of subjective assumptions, including the expected life of the option and expected stock price volatility. Recro uses the Black-Scholes option pricing model to value its stock option awards. The assumptions used in calculating the fair value of stock-based awards represent management’s best estimates and involve inherent uncertainties and the application of management’s judgment. As a result, if factors change and/or management uses different assumptions, stock-based compensation expense could be materially different for future awards. The expected life of stock options was estimated using the “simplified method,” as Recro has limited historical information to develop reasonable expectations about future exercise patterns and post-vesting employment termination behavior for its stock options grants. The simplified method is based on the average of the vesting tranches and the contractual life of each grant. For stock price volatility, Recro uses the historical volatility of its publicly traded stock in order to estimate future stock price trends. The risk-free interest rate is based on U.S. Treasury notes with a term approximating the expected life of the option. ( k ) Income Taxes The income tax amounts in these consolidated and combined financial statements for periods prior to the Separation have been calculated based on a separate return methodology and presented as if the Company was a standalone taxpayer in each of its tax jurisdictions. Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis, operating losses and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in operations in the period that includes the enactment date. A valuation allowance is recorded to the extent it is more likely than not that some portion or all of the deferred tax assets will not be realized. Because of the Company’s history of losses as a standalone entity, a full valuation allowance is recorded against deferred tax assets in all periods presented. Unrecognized income tax benefits represent income tax positions taken on income tax returns that have not been recognized in the consolidated and combined financial statements. The Company recognizes the benefit of an income tax position only if it is more likely than not (greater than 50%) that the tax position will be sustained upon tax examination, based solely on the technical merits of the tax position. Otherwise, no benefit is recognized. The tax benefits recognized are measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. The Company does not anticipate significant changes in the amount of unrecognized income tax benefits over the next year. ( l ) Net Income (Loss) Per Common Share Basic net income (loss) per common share is determined by dividing net income (loss) applicable to common shareholders by the weighted average common shares outstanding during the period. Outstanding warrants, common stock options and unvested restricted stock units are excluded from the calculation of diluted net income (loss) per share when their effect would be anti-dilutive. For purposes of calculating diluted income ( loss ) per common share, the denominator includes both the weighted average common shares outstanding and the number of common stock equivalents if the inclusion of such common stock equivalents would be dilutive. Prior to the distribution date of November 21, 2019, there were no Baudax Bio shares outstanding, as such, the shares outstanding immediately after the Distribution were used to calculate the net loss per share for all pre-Separation periods presented. The following table reconciles the shares used in the calculation of basic net income per share to those used for diluted net income per share: Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Basic and Diluted Income (Loss) Per Share Net income (loss) $ 11,685 $ (10,315 ) $ (59,058 ) $ (25,232 ) Weighted average common shares outstanding, basic 18,374,604 9,350,709 15,366,861 9,350,709 Dilutive effect of equity awards, based on the treasury stock method 393,772 — — — Weighted average common shares outstanding, diluted 18,768,376 9,350,709 15,366,861 9,350,709 The following potentially dilutive securities have been excluded from the computations of diluted weighted average shares outstanding as they would be anti-dilutive: Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Options and restricted stock units outstanding 2,098,316 — 1,694,889 — Warrants 15,107,100 — 15,199,605 — Amounts in the table above reflect the common stock equivalents of the noted instruments. For the three and nine months ended September 30, 2019, there were no outstanding warrants, common stock options or unvested restricted stock units. ( m ) Recent Accounting Pronouncements Recently Adopted Accounting Pronouncements In February 2016, the FASB issued ASU No. 2016-02, “ Leases (Topic 842) Targeted Improvements Note 8. In August 2018, the FASB issued ASU 2018-13, “ Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement, Fair Value Measurement years, beginning after December 15, 2019 with early adoption permitted. The Company adopted this guidance as of January 1, 2020 . The adoption did no t have a material impact to the Company or its disclosures. Accounting Pronouncements Not Yet Adopted In June 2016, the FASB issued ASU No. 2016-13, “ Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments,” In August 2020, the FASB issued ASU No. 2020-06, “Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity's Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity's Own Equity,” or ASU 2020-06. ASU 2020-06 simplifies accounting for convertible instruments by removing major separation models required under current GAAP. ASU 2020-06 removes certain settlement conditions that are required for equity contracts to qualify for the derivative scope exception, which will permit more equity contracts to qualify for such exception. ASU 2020-06 also simplifies the diluted earnings per share calculation in certain areas. ASU 2020-06 is effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years and early adoption is permitted in annual reporting periods ending after December 15, 2020. The Company is currently assessing the impact of adopting this standard. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 9 Months Ended |
Sep. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | ( 4 ) Fair Value of Financial Instruments The Company follows the provisions of FASB ASC Topic 820, “ Fair Value Measurements and Disclosures • Level 1: Observable inputs such as quoted prices (unadjusted) in active markets for identical assets or liabilities; • Level 2: Inputs that are other than quoted prices in active markets for identical assets and liabilities, inputs that are quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are either directly or indirectly observable; and • Level 3: Unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions. The Company has classified assets and liabilities measured at fair value on a recurring basis as follows: Fair value measurements at reporting date using Quoted prices in active markets for identical assets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) At September 30, 2020: Assets: Cash equivalents (See Note 5) Money market mutual funds $ 22,910 $ — $ — Total cash equivalents $ 22,910 $ — $ — Liabilities: Warrants (See Note 13(c)) $ — $ — $ 10,228 Contingent consideration (See Note 12(b)) — — 78,110 $ — $ — $ 88,338 At December 31, 2019: Assets: Cash equivalents (See Note 5) Money market mutual funds $ 16,514 $ — $ — Total cash equivalents $ 16,514 $ — $ — Liabilities: Contingent consideration (See Note 12(b)) $ — $ — $ 66,358 $ — $ — $ 66,358 The Company developed certain of its own assumptions to determine the value of the warrants that do not have observable inputs or available market data to support the fair value. This method of valuation involves using inputs such as the fair value of the Company’s common stock, stock price volatility, the contractual term of the warrants, risk free interest rates and dividend yield. Due to the nature of these inputs, the valuation of the warrants is considered a Level 3 measurement. The reconciliation of liabilities measured at fair value on a recurring basis using unobservable inputs (Level 3) is as follows: Warrants Contingent Consideration Balance at December 31, 2019 $ — $ 66,358 Additions 8,111 — Exercise of warrants (746 ) — Payment of contingent consideration — (2,500 ) Remeasurement 2,863 14,252 Total at September 30, 2020 $ 10,228 $ 78,110 Current portion as of September 30, 2020 $ — $ 10,677 Long-term portion as of September 30, 2020 10,228 67,433 The current portion of the contingent consideration represents the estimated probability adjusted fair value that is expected to become payable within one year as of September 30, 2020. The fair value of the contingent consideration liability is measured as the reporting date using inputs and assumptions as of the date of the financial statements. Events and circumstances impacting the fair value of the liability that occur after the balance sheet date, but before the date that the financial statements are available to be issued are adjusted in the period during which such events and circumstances occur. The fair value of the second contingent consideration component is estimated by applying a risk-adjusted discount rate to the probability-adjusted contingent payments and the expected payment dates. The fair value of the third contingent consideration component is estimated using the Monte Carlo simulation method and applying a risk-adjusted discount rate to the potential payments resulting from probability-weighted revenue projections based upon the expected revenue target attainment dates. The fair value of the fourth contingent consideration component is estimated by applying a risk-adjusted discount rate to the potential payments resulting from probability-weighted revenue projections and the defined royalty percentage. As of September 30, 2020 , t he fair value calculations used discount rates in the range of 15.42 % to 33.94 % , with a weighted average of 23.35 %. These fair values are based on significant inputs not observable in the market, which are referred to in the guidance as Level 3 inputs. The contingent consideration components are classified as liabilities and are subject to the recognition of subsequent changes in fair value through the results of operations. The Company follows the disclosure provisions of FASB ASC Topic 825, “ Financial Instruments |
Cash Equivalents
Cash Equivalents | 9 Months Ended |
Sep. 30, 2020 | |
Cash And Cash Equivalents [Abstract] | |
Cash Equivalents | (5) Cash Equivalents Cash equivalents as of September 30, 2020 include money market funds. The following is a summary of cash equivalents: September 30, 2020 Amortized Gross Unrealized Estimated Description Cost Gain Loss Fair Value Money market mutual funds $ 22,910 $ — $ — $ 22,910 Total cash equivalents $ 22,910 $ — $ — $ 22,910 December 31, 2019 Amortized Gross Unrealized Estimated Description Cost Gain Loss Fair Value Money market mutual funds $ 16,514 $ — $ — $ 16,514 Total cash equivalents $ 16,514 $ — $ — $ 16,514 |
Inventory
Inventory | 9 Months Ended |
Sep. 30, 2020 | |
Inventory Disclosure [Abstract] | |
Inventory | (6) Inventory Inventory is stated at the lower of cost and net realizable value. Cost is determined using the first-in, first-out method. The Company expensed costs related to inventory within the Research and development line in the Consolidated and Combined Statements of Operations until it received approval from the FDA to market a product, at which time the Company commenced capitalization of costs relating to that product. Adjustments to inventory are determined at the raw material, sub-assemblies and finished goods levels to reflect obsolescence or impaired balances. Inventory was as follows: September 30, 2020 December 31, 2019 Raw materials $ 67 $ — Sub-assemblies 796 — Finished goods 921 — $ 1,784 $ — |
Property, Plant and Equipment
Property, Plant and Equipment | 9 Months Ended |
Sep. 30, 2020 | |
Property Plant And Equipment [Abstract] | |
Property, Plant and Equipment | ( 7 ) Property, Plant and Equipment Property, plant and equipment consists of the following: September 30, 2020 December 31, 2019 Building and improvements $ 196 $ 196 Furniture, office and computer equipment 935 902 Manufacturing and laboratory equipment 717 717 Construction in progress 4,142 3,846 5,990 5,661 Less: accumulated depreciation 1,155 840 Property, plant and equipment, net $ 4,835 $ 4,821 Depreciation expense for the three and nine months ended September 30, 2020 was $104 and $315, respectively. Depreciation expense for the three and nine months ended September 30, 2019 was $123 and $369, respectively. |
Leases
Leases | 9 Months Ended |
Sep. 30, 2020 | |
Leases [Abstract] | |
Leases | ( 8 ) Leases The Company is a party to various operating leases in Malvern, Pennsylvania, and Dublin, Ireland for office space and office equipment. Right-of-use assets are recorded on the Consolidated Balance Sheet in other long-term assets. Operating lease liabilities are recorded on the Consolidated Balance Sheet in accrued expenses and other current liabilities and other long-term liabilities, based on the timing of expected cash payments. The Company determines if an arrangement is a lease at inception. The arrangement is a lease if it conveys the right to the Company to control the use of identified property, plant, or equipment for a period of time in exchange for consideration. Lease terms vary based on the nature of operations. The current leased facility recorded on the Consolidated Balance Sheet is classified as an operating lease with a remaining lease term of 2 years. Most leases contain specific renewal options where notice to renew must be provided in advance of lease expiration or automatic renewals where no advance notice is required. Periods covered by an option to extend the lease were included in the non-cancellable lease term when exercise of the option was determined to be reasonably certain. Costs determined to be variable and not based on an index or rate were not included in the measurement of operating lease liabilities. As most leases do not provide an implicit rate, the Company's effective interest rate was used to discount its lease liabilities. The Company’s leases with an initial term of 12 months or less that do not have a purchase option or extension that is reasonably certain to be exercised are not included in the right of use asset or lease liability on the Consolidated Balance Sheets. Lease expense is recognized on a straight-line basis over the lease term . As of September 30, 2020, undiscounted future lease payments for non-cancellable operating leases are as follows: Lease payments Remainder of 2020 $ 127 2021 367 2022 373 Total lease payments 867 Less imputed interest (172 ) Total operating lease liability $ 695 As of September 30, 2020, the weighted average remaining lease term was 2 years and the weighted average discount rate was 16%. The components of the Company’s lease cost were as follows: Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Operating lease cost $ 87 $ 121 $ 306 $ 363 Short-term lease cost 38 - 68 14 Total lease cost $ 125 $ 121 $ 374 $ 377 Cash paid for amounts included in the measurement of lease liabilities, which is included in operating cash flows, was $78 and $344 for the nine months ended September 30, 2020 and 2019, respectively. |
Intangible Assets
Intangible Assets | 9 Months Ended |
Sep. 30, 2020 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Intangible Assets | ( 9 ) Intangible Assets The following represents the balance of the intangible assets at September 30, 2020: Cost Accumulated Amortization Net Intangible Assets Asset resulting from R&D activities $ 26,400 $ 1,502 $ 24,898 Total $ 26,400 $ 1,502 $ 24,898 Amortization expense for the three and nine months ended September 30, 2020 was $643 and $1,502, respectively. There was no amortization expense for the three and nine months ended September 30, 2019. As of September 30, 2020 Amortization Remainder of 2020 $ 644 2021 2,576 2022 2,576 2023 2,576 2024 and thereafter 16,526 Total $ 24,898 |
Accrued Expenses and Other Curr
Accrued Expenses and Other Current Liabilities | 9 Months Ended |
Sep. 30, 2020 | |
Payables And Accruals [Abstract] | |
Accrued Expenses and Other Current Liabilities | ( 10 ) Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consist of the following: September 30, December 31, 2020 2019 Payroll and related costs $ 3,936 $ 2,181 Inventory 1,014 0 Professional and consulting fees 667 209 Research and development costs 272 538 Guarantee liability 443 548 Interest payable 119 — Other 841 374 $ 7,292 $ 3,850 |
Debt
Debt | 9 Months Ended |
Sep. 30, 2020 | |
Debt Disclosure [Abstract] | |
Debt | (11) Debt The following table summarizes the components of the carrying value of debt as of September 30, 2020: Paycheck Protection Program Loan $ 1,537 Credit Agreement 10,000 Unamortized deferred issuance costs (2,637 ) Exit fee accretion 24 Total debt $ 8,924 Current portion as of September 30, 2020 $ 171 Long-term portion, net as of September 30, 2020 8,753 (a) Paycheck Protection Program Loan On April 13, 2020, the Company applied to PNC Bank, National Association (the “Lender”) under the Small Business Administration (the “SBA”) Paycheck Protection Program (“PPP”) of the Coronavirus Aid, Relief and Economic Security Act of 2020 (the “CARES Act”) for a loan of $1,537 (the “Loan”). On May 8, 2020, the Company entered into a promissory note with respect to the Loan in favor of the Lender (the “PPP Note”). The Company has used the proceeds of the Loan for covered payroll costs in accordance with the relevant terms and conditions of the CARES Act. The PPP Note has a two-year The Loan may be partially or fully forgiven if the Company complies with the provisions of the CARES Act including the use of Loan proceeds for payroll costs, rent, utilities and certain other expenses, and at least 60% of the Loan proceeds must be used for payroll costs as defined by the CARES Act. Any forgiveness of the Loan will be subject to approval by the SBA and the Lender will require the Company to apply for such treatment in the future. According to the terms of the Credit Agreement, as defined below, if any amount less than $1,100 is not forgiven, the Company will be required to promptly repay the unforgiven amount of the PPP Note that is less than $1,100. (b) Credit Agreement On May 29, 2020 (the “Credit Agreement Closing Date”), the Company entered into a $50,000 Credit Agreement (the “Credit Agreement”) by and among the Company, Wilmington Trust, National Association, in its capacity as the agent (“Agent”), and MAM Eagle Lender, LLC, as the lender (together with any other lenders under the Credit Agreement from time to time, collectively, the “Lenders”). The Credit Agreement provides for a term loan in the original principal amount of $10,000 (the “Tranche One Loans”) funded on the Credit Agreement Closing Date. Pursuant to the terms of the Credit Agreement, there are four additional tranches of term loans, in an aggregate original principal amount of $40,000 (the “Tranche Two Loans”, “Tranche Three Loans”, “Tranche Four Loans” and the “Tranche Five Loans”, and collectively with the Tranche One Loans, the “Term Loans” and each a “Term Loan”). The Tranche Two Loans in an amount not to exceed $5,000 may be drawn upon on or before August 29, 2021 provided that the Company generates at least $5,000 in net revenue in the three consecutive calendar months immediately preceding the date such Tranche Two Loans are funded. The Tranche Two Loans may also be drawn on a subsequent date with the satisfaction of the conditions for the Tranche Three Loans, Tranche Four Loans, or Tranche Five Loans, as applicable, provided that the Tranche Two Loans may not be drawn more than once. The Tranche Three Loans in an amount not to exceed $5,000 may be drawn upon on or before November 29, 2021 provided that the Company generates at least $10,000 in net revenue in the three consecutive calendar months immediately preceding such date such Tranche Three Loans are funded. The Tranche Three Loans may also be drawn on a subsequent date with the satisfaction of the conditions for the Tranche Four Loans or Tranche Five Loans, as applicable, provided that the Tranche Three Loans may not be drawn more than once. The Tranche Four Loans in an amount not to exceed $10,000 may be drawn upon, subject to the consent of the Lenders, on or before August 29, 2022 provided that the Company generates at least $20,000 in net revenue in the three consecutive calendar months immediately preceding the date such Tranche Four Loans are funded. The Tranche Four Loans may also be drawn on a subsequent date with the satisfaction of the conditions for the Tranche Five Loans provided that the Tranche Four Loans may not be drawn more than once. The Tranche Five Loans in an amount not to exceed $20,000 may be drawn upon, subject to the consent of the Lenders, on or before March 1, 2023 provided that the Company generates at least $100,000 in net revenue in the twelve consecutive calendar months immediately preceding the date such Tranche Five Loans are funded. The Term Loans will bear interest at a per annum rate equal to 13.5%, with monthly, interest-only payments until the date that is three years prior to the Maturity Date (as defined below) (the “Amortization Date”). The maturity date of the Credit Agreement is May 29, 2025, but may be extended to May 29, 2026 provided that the EBITDA (as defined in the Credit Agreement) for the consecutive twelve month period ending on or immediately prior to May 29, 2022 is greater than $10,000 (such date, “Maturity Date”). Beginning on the Amortization Date, the Company will be obligated to pay amortization payments (in addition to the interest stated above) on such date and each month thereafter in equal month installments of principal based on an amortization schedule of thirty-six months. Any unpaid principal amount of the Term Loans is due and payable on the Maturity Date. Subject to certain exceptions, the Company is required to make mandatory prepayments of the Term Loans, with the proceeds of asset sales, extraordinary receipts, debt issuances and specified other events. The Company may make voluntary prepayments in whole or in part, subject to a prepayment premium equal to (i) with respect to any prepayment paid on or prior to the third anniversary of the Tranche One Loan (or, in the case of each of the Tranche Two Loans, Tranche Three Loans, Tranche Four Loans or Tranche Five Loans, the third anniversary of the date each such loan is funded), the remaining scheduled payments of interest that would have accrued on the Term Loans being prepaid, repaid or accelerated, but that remained unpaid, in no event to be less than 5.0 % of the principal amount of the Term Loan being prepaid, and (ii) with respect to any prepayment paid after the third but prior to the fourth anniversary of the Tranche One Loan (or, in the case of each of the Tranche Two Loans, Tranche Three Loans, Tranche Four Loans or Tranche Five Loans, the fourth anniversary of the date each such loan is funded), 3.0 % of the principal amount of the Term Loan being prepaid. In addition, an exit fee will be due and payable upon prepayment or repayment of the Term Loans (including, without limitation, on the Maturity Date) equal to the lesser of 2.5 % of the sum of the aggregate principal amount of the Term Loans advanced or approved to be advanced by the Lenders and $ 700 ; provided that such exit fee will be equal to $ 700 if fee is paid in conjunction with a change of control that occurs in connection with the payoff or within 6 months thereof. As of September 30, 2020 , the Company will have to pay a 2.5 % exit fee, which is $ 250 at the current outstanding loan balance and is being accreted to the carrying amount of the debt using the effective interest method over the term of the loan. The Credit Agreement contains certain usual and customary affirmative and negative covenants, as well as financial covenants including a minimum liquidity requirement of $5,000 at all times and minimum EBITDA levels that the Company may need to satisfy on a quarterly basis beginning in September 2021, subject to borrowing levels. As of September 30, 2020, the Company was in compliance with the required covenants. As of September 30, 2020, borrowings under the Credit Agreement are classified based on their schedule maturities. As a result of the liquidity conditions discussed in Note 2, the Company is not expected to be able to maintain its minimum liquidity covenant over the next twelve months without additional capital financing. If the Company is unable to maintain its minimum liquidity covenant, it is reasonably possible that the Lenders could demand repayment of the borrowings under the Credit Agreement during the next twelve months. In connection with the Credit Agreement, the Company issued a warrant to MAM Eagle Lender, LLC to purchase 527,100 shares of the Company’s common stock, at an exercise price equal to $4.59 per share. See Note 13(c) for additional information. The warrant is exercisable through May 29, 2027. In addition, the Company recorded debt issuance costs for the Credit Agreement of $1,496 and the fair value of warrants of $1,423, which are being amortized using the effective interest method over the term of Credit Agreement. Debt issuance cost amortization is included in interest expense within the Consolidated and Combined Statements of Operations. As of September 30, 2020, the effective interest rate was 22.66%, which takes into consideration the non-cash amortization of the debt issuance costs and accretion of the exit fee. The Company recorded debt issuance cost amortization related to the Credit Agreement of $211 and $281 for the three and nine months ended September 30, 2020. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2020 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | ( 1 2 ) Commitments and Contingencies (a) Licenses and Supply Agreements The Company is party to an exclusive license with Orion for the development and commercialization of Dexmedetomidine for use in the treatment of pain in humans in any dosage form for transdermal, transmucosal (including sublingual and intranasal), topical, enteral or pulmonary (inhalational) delivery, but specifically excluding delivery vehicles for administration by injection or infusion, worldwide, except for Europe, Turkey and the CIS (currently includes Armenia, Azerbaijan, Belarus, Georgia, Kazakhstan, Kyrgyzstan, Moldova, Russia, Tajikistan, Turkmenistan, Ukraine and Uzbekistan), referred to herein as the Territory. The Company is required to pay Orion lump sum payments of up to €20,500 ($24,033 as of September 30, 2020) on the achievement of certain developmental and commercial milestones, as well as a royalty on net sales during the term, which varies from 10% to 20% depending on annual sales levels. Through September 30, 2020, no such milestones have been achieved. The Company is also party to an exclusive license agreement with Orion for the development and commercialization of Fadolmidine for use as a human therapeutic, in any dosage form in the Territory. The Company is required to pay Orion lump sum payments of up to €12,200 ($14,304 as of September 30, 2020) on achievement of certain developmental and commercial milestones, as well as a royalty on net sales during the term, which varies from 10% to 15% depending on annual sales levels. Through September 30, 2020, no such milestones have been achieved. In June 2017, the Company acquired the exclusive global rights to two novel neuromuscular blocking agents (“NMBAs”) and a proprietary reversal agent from Cornell University (“Cornell”). The NMBAs and reversal agent are referred to herein as the NMBA Related Compounds. The NMBA Related Compounds include one novel intermediate-acting NMBA that has initiated Phase I clinical trials and two other agents, a novel short-acting NMBA, and a rapid-acting reversal agent specific to these NMBAs . is obligated to pay Cornell royalties on net sales of the NMBA Related Compound at a rate ranging from low to mid-single digits, depending on the applicable NMBA Related Compounds and whether there is a valid patent claim in the applicable country, subject to an annual minimum royalty amount. Further, the Company will reimburse Cornell ongoing patent costs related to prosecution and maintenance of the patents related to the Cornell patents for the NMBA Related Compounds. The Company is party to a Development, Manufacturing and Supply Agreement (“Supply Agreement”), with Alkermes plc (“Alkermes”) (through a subsidiary of Alkermes), pursuant to which Alkermes will (i) provide clinical and commercial bulk supplies of ANJESO formulation and (ii) provide development services with respect to the Chemistry, Manufacturing and Controls section of an NDA for ANJESO. Pursuant to the Supply Agreement, Alkermes will supply the Company with such quantities of bulk ANJESO formulation as shall be reasonably required for the completion of clinical trials of ANJESO. During the term of the Supply Agreement, the Company will purchase its clinical and commercial supplies of bulk ANJESO formulation exclusively from Alkermes, subject to certain exceptions, for a period of time. The Company is party to a Master Manufacturing Services Agreement and Product Agreement with Patheon, collectively the Patheon Agreements, pursuant to which Patheon provides sterile fill-finish of injectable meloxicam drug product at its Monza, Italy manufacturing site. The Company has agreed to purchase a certain percentage of its annual requirements of finished injectable meloxicam from Patheon during the term of the Patheon Agreements. (b) Contingent Consideration for the Alkermes Transaction On April 10, 2015, Recro completed the acquisition of a manufacturing facility in Gainesville, Georgia and the licensing and commercialization rights to injectable meloxicam (the “Alkermes Transaction”). Pursuant to the purchase and sale agreement and subsequent amendment with Alkermes, as amended, governing the Alkermes Transaction, the Company agreed to pay to Alkermes up to an additional upon regulatory approval payable over a seven-year Based on the amended terms of the Alkermes agreement, the contingent consideration consists of four separate components. The first component is (i) a $5,000 payment made in the first quarter of 2019 and (ii) a $5,000 payment made in the second quarter of 2019. The second components are payable upon regulatory approval and include (i) a $5,000 payment due within 180 days following regulatory approval for ANJESO, of which timing of payment was amended as noted below, and (ii) $45,000 payable in seven equal annual payments of approximately $6,400 beginning on the first anniversary of such approval. The third component consists of three potential payments, based on the achievement of specified annual revenue targets, the last of which represents over 60% of these milestone payments and currently does not have a fair value assigned to its achievement. The fourth component consists of a royalty payment between 10% and 12% (subject to a 30% reduction when no longer covered by patent) for a defined term on future injectable meloxicam net sales. In August 2020, the Company entered in to an Amendment to the Purchase and Sale Agreement that restructured the timing of payment of the $5,000 milestone development earn-out consideration due to Alkermes as a result of achievement of approval of the NDA for ANJESO to be paid in three installments of (i) $2,500 paid August 18, 2020; (ii) $1,060 on or prior to December 20, 2020; and (iii) $1,440 on or prior to June 20, 2021. In consideration of amending the timing of this development milestone earn-out payment, the Company paid Alkermes a one-time, non-refundable and non-creditable fee of $285 at the time of entering into the Amendment to the Purchase and Sale Agreement. As of September 30, 2020, the Company has paid $12,500 in milestone payments to Alkermes. (c) Litigation The Company is involved, from time to time, in various claims and legal proceedings arising in the ordinary course of its business. Except as disclosed below, the Company is not currently a party to any such claims or proceedings that, if decided adversely to it, would either individually or in the aggregate have a material adverse effect on its business, financial condition or results of operations. On May 31, 2018, a securities class action lawsuit (the “Securities Litigation”) was filed against Recro and certain of Recro’s officers and directors in the U.S. District Court for the Eastern District of Pennsylvania (Case No. 2:18-cv-02279-MMB) that purported to state a claim for alleged violations of Section 10(b) and 20(a) of the Exchange Act and Rule 10(b)(5) promulgated thereunder, based on statements made by Recro concerning the NDA for ANJESO. The complaint seeks unspecified damages, interest, attorneys’ fees, and other costs. On December 10, 2018, the lead plaintiff filed an amended complaint that asserted the same claims and sought the same relief but included new allegations and named additional officers as defendants. On February 8, 2019, Recro filed a motion to dismiss the amended complaint in its entirety, which the lead plaintiff opposed on April 9, 2019. On May 9, 2019, Recro filed its response and briefing was completed on the motion to dismiss. In response to questions from the Judge, the parties submitted supplemental briefs with regard to the motion to dismiss the amended complaint during the fall of 2019. On February 18, 2020, the motion to dismiss was granted without prejudice. On April 25, 2020, the plaintiff filed a second amended complaint. Recro filed a motion to dismiss the second amended complaint on June 18, 2020 . The plaintiff file d an opposition to the motion to dismiss on August 17, 2020 . On September 16, 2020, Recro filed a reply in support of the motion to dismiss. In connection with the Separation, the Company accepted assignment by Recro of all of Recro ’ s obligations in connection with the Securities Litigation and agreed to indemnify Recro for all liabilities related to the Securities Litigation. The Company has recorded a liability equal to the estimated fair value of the indemnification to Recro related to this Securities Litigation. The Company believes that the lawsuit is without merit and intend s to vigorously defend against it. A t this time, no assessment can be made as to its likely outcome or whether the outcome will be material to the Company. ( d ) Purchase Commitments As of September 30, 2020, the Company had outstanding non-cancelable and cancelable purchase commitments in the aggregate amount of $10,840 related to inventory and other goods and services, including commercial activities and manufacturing scale-up. The timing of certain purchase commitments cannot be estimated as it is dependent on sales launch trajectory or the outcome of other strategic evaluations and agreements. ( e ) Certain Compensation and Employment Agreements The Company has entered into employment agreements with certain of its named executive officers. As of September 30, 2020, these employment agreements provided for, among other things, annual base salaries in an aggregate amount of not less than $1,327, from that date through March 2022 |
Capital Structure
Capital Structure | 9 Months Ended |
Sep. 30, 2020 | |
Equity [Abstract] | |
Capital Structure | ( 1 3 ) Capital Structure (a) Common Stock On November 21, 2019, the Company separated from Recro as a result of a special dividend distribution of all the outstanding shares of its common stock to Recro shareholders. On the distribution date, each Recro shareholder received one share of Baudax Bio’s common stock for every two and one-half The Company is authorized to issue 100,000,000 shares of common stock, with a par value of $0.01 per share. On February 13, 2020, the Company entered into a Sales Agreement (the “Sales Agreement”) with JMP Securities LLC, as sales agent (the “Agent”), pursuant to which the Company may, from time to time, issue and sell shares of its common stock, par value $0.01 per share, in an aggregate offering price of up to $25,000 through the Agent. As of September 30, 2020, 441,967 shares of common stock have been sold under the Sales Agreement for net proceeds of $3,612. The Agent was paid a sales commission of 3% for such sales under the Sales Agreement. On March 26, 2020, the Company closed an underwritten public offering of 7,692,308 shares of its common stock, Series A Warrants to purchase 7,692,308 shares of common stock (the “Series A Warrants”) and Series B Warrants to purchase 7,692,308 shares of common stock (the “Series B Warrants”), at an exercise price of $4.59 per share for Series A Warrants and at an exercise price of $3.25 per share for Series B Warrants, for net proceeds to the Company of (b) Preferred Stock The Company is authorized to issue 10,000,000 shares of preferred stock, with a par value of $0.01 per share. As of September 30, 2020, no preferred stock was issued or outstanding. (c) Warrants On May 29, 2020, in connection with the Credit Agreement, the Company issued a warrant to MAM Eagle Lender, LLC to purchase 527,100 shares of common stock, at an exercise price equal to $4.59 per share. During the nine months ended September 30, 2020, the Company issued 804,616 shares of common stock upon exercise of Series B Warrants for net proceeds of $2,458. As of September 30, 2020, the Company had the following warrants outstanding to purchase shares of the Company’s common stock: Number of Shares Exercise Price per Share Expiration Date Series A Warrants 7,692,308 $ 4.59 March 26, 2025 Series B Warrants 6,887,692 $ 3.25 April 26, 2021 MAM Eagle Lender Warrant 527,100 $ 4.59 May 29, 2027 The Series A Warrants to purchase 7,692,308 shares of common stock and Series B Warrants to purchase 6,887,692 shares of common stock related to the public offering are liability classified as they contain antidilution provisions that do not meet the standard definition of antidilution provisions. The warrant to purchase 527,100 shares of common stock is equity classified. The following table summarizes the fair value and the assumptions used for the Black-Scholes option-pricing model for the liability classified warrants. September 30, 2020 Series A Warrants Series B Warrants Fair value $ 6,857 $ 3,371 Expected dividend yield — % — % Expected volatility 73.86 % 101.47 % Risk-free interest rates .28 % .11 % Remaining contractual term 4.5 years 0.6 years On October 19, 2020, the Company entered into Warrant Exchange Agreements (each, an “Exchange Agreement”) with certain holders (each, a “Holder”) of the Company’s outstanding Series A Warrants and Series B Warrants. Pursuant to the Exchange Agreements, the Holders, at their election, agreed to a cashless exchange of either all of their Series A Warrants or Series B Warrants, in each case for 0.2 shares of the Company’s common stock per warrant (rounded up to the nearest whole share) (the “Exchange”). No Holder exchanged both series of warrants in the Exchange. The closings of the exchanges contemplated by the Exchange Agreements occurred on October 21, 2020. The Company issued 1,186,774 shares of its common stock to the participating Holders as a result of the Exchange. Series A Warrants and Series B Warrants to purchase 8,646,154 shares of the Company’s common stock were outstanding immediately after the Exchange. As a result of the Exchange, pursuant to certain price adjustment provisions in the warrants, the exercise price of each of the Series A Warrants or Series B Warrants (including warrants held by holders not participating in the Exchange) that were not exchanged were adjusted to par value, or $0.01, for each share of common stock underlying such warrant. Pursuant to the Exchange Agreements, any outstanding warrant held by a Holder participating in the Exchange (i) was amended to remove certain anti-dilution and variable pricing protections and (ii) in the case of Series A Warrants not exchanged by a participating Holder, was amended to adjust the expiration date of such Series A Warrants to April 26, 2021 (which is the expiration date of the Series B Warrants). As of November 5, 2020, the Company issued 6,677,447 shares of its common stock upon the exercise of its Series A Warrants and Series B Warrants subsequent to the Exchange. As of November 5, 2020, there were 64,738 Series A Warrants outstanding and 1,903,969 Series B Warrants outstanding. |
Stock-Based Compensation
Stock-Based Compensation | 9 Months Ended |
Sep. 30, 2020 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Stock-Based Compensation | (14) Stock-Based Compensation The Company has adopted the 2019 Plan, which allows for the grant of stock options, stock appreciation rights and stock awards for a total of 3,000,000 shares of common stock. On December 1 st st Stock Options: Stock options are exercisable generally for a period of 10 years from the date of grant and generally vest over four years. The weighted average grant-date fair value of the Baudax Bio options awarded to employees during nine months ended September 30, 2020 was $2.22. Under the 2019 Plan, the fair value of the Baudax Bio options was estimated on the date of grant using a Black-Scholes option pricing model with the following weighted average assumptions: September 30, 2020 Range of expected option life 6 years Expected volatility 73.77% Risk-free interest rate .41% Expected dividend yield — Certain employees of the Company participated in the Recro Equity Plan. The combined financial statements prior to the Separation reflect stock-based compensation expense related to Recro stock options and RSUs issued to the Company’s employees as well as an allocation of a portion of Recro share-based compensation issued to corporate employees and members of the Board of Directors until the Separation date. The weighted average grant-date fair value of the options awarded to employees under the Recro Equity Plan during the nine months ended September 30, 2019 was $5.53. Under the Recro Equity Plan for the nine months ended September 30, 2019, the fair value of the options granted to employees of the Company was estimated on the date of grant using a Black-Scholes option pricing model with the following weighted average assumptions: September 30, 2019 Range of expected option life 6 years Expected volatility 79.96% Risk-free interest rate 2.60% Expected dividend yield — The following table summarizes Baudax Bio stock option activity during the nine months ended September 30, 2020: Number of shares Weighted average exercise price Weighted average remaining contractual life Balance, December 31, 2019 643,879 $ 6.33 9.9 years Granted 840,299 $ 3.48 Expired/forfeited/cancelled (22,500 ) $ 4.15 Balance, September 30, 2020 1,461,678 $ 4.72 9.5 years Vested 120,720 $ 6.33 9.2 years Vested and expected to vest 1,461,678 $ 4.72 9.5 years Included in the table above are 634,503 stock options outstanding as of September 30, 2020 that were granted outside of the plan. The grants were made pursuant to the Nasdaq inducement grant exception in accordance with Nasdaq Listing Rule 5635(c)(4). Restricted Stock Units (RSUs): The following table summarizes the Baudax Bio RSUs activity during the nine months ended September 30, 2020: Number of shares Balance, December 31, 2019 1,380,030 Granted 377,351 Vested and settled (50,240 ) Expired/forfeited/cancelled (6,000 ) Balance, September 30, 2020 1,701,141 Expected to vest 1,701,141 Included in the table above are 176,307 time-based RSUs outstanding as of September 30, 2020 that were granted outside of the plan. The grants were made pursuant to the Nasdaq inducement grant exception in accordance with Nasdaq Listing Rule 5635(c)(4). Stock-Based Compensation Expense: Stock-based compensation expense for the nine months ended September 30, 2020 and 2019 was $7,431 and $4,254, respectively. For the current year, this represents stock-based compensation from the 2019 Plan as well as stock-based compensation from the Recro Equity Plan for certain Baudax Bio employees who are continuing to vest in their Recro awards but are not performing services to Recro. For the prior year, this represents the allocated portion of Recro stock-based compensation expense for employees of the Company. As of September 30, 2020, there was $10,720 of unrecognized compensation expense related to unvested options and time-based RSUs that are expected to vest and will be expensed over a weighted average period of 2.6 years, which includes stock-based compensation from the 2019 Plan as well as the Recro Equity Plan for certain employees of the Company. The aggregate intrinsic value represents the total amount by which the fair value of the common stock subject to options exceeds the exercise price of the related options. As of September 30, 2020, the aggregate intrinsic value of the unvested options was $66. There was no aggregate intrinsic value of the vested options. |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2020 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | (1 5 ) Related Party Transactions A Non-Executive Director of the Company’s Irish subsidiary is a Managing Director and a majority shareholder of HiTech Health Ltd (“HiTech Health”), a consultancy firm for the biotech, pharmaceutical and medical device industry. Since 2016, HiTech Health has provided the Company with certain consulting services and in November 2017 both parties entered into a Service Agreement to engage in both regulatory and supply chain project support and consultancy. In consideration for such services, the Company recorded $5 and $11 for the three months ended September 30, 2020 and 2019, respectively. For the nine months ended September 30, 2020 and 2019, the Company recorded $133 and $115, in consideration for such services, respectively. A portion of the amount relates to consultancy services provided by the Non-Executive Director. Recro became a related party to the Company following the Separation. As part of the Separation, the Company entered into a transition services agreement with Recro. Under the transition services agreement, the Company provides certain services to Recro, each related to corporate functions, and are charged to Recro. Additionally, Recro may incur expenses that are directly related to the Company after the Separation, which are billed to the Company. For the three and nine months ended September 30, 2020, the Company recorded income of $516 and $1,548, respectively, related to the transition services agreement, which is recorded as a reduction in selling, general and administrative expenses. The Company recorded a net payable of $39 for activities with Recro as of September 30, 2020. In connection with the Separation, Recro and Baudax entered into an Employee Matters Agreement. The Employee Matters Agreement allocates liabilities and responsibilities relating to employee compensation and benefits plans and programs and other related matters in connection with the Distribution including, without limitation, the treatment of outstanding Recro equity awards. In connection with the Separation, Recro and Baudax entered into a Tax Matters Agreement that governs the parties’ respective rights, responsibilities and obligations with respect to taxes, tax attributes, the preparation and filing of tax returns, the control of audits and other tax proceedings and other matters regarding taxes for any tax period ending on or before the Distribution date, as well as tax periods beginning after the Distribution date. |
Retirement Plan
Retirement Plan | 9 Months Ended |
Sep. 30, 2020 | |
Compensation And Retirement Disclosure [Abstract] | |
Retirement Plan | ( 1 6 ) Retirement Plan The Company has a voluntary 401(k) Savings Plan (the “401(k) Plan”) in which all employees are eligible to participate. The Company’s policy is to match 100% of the employee contributions up to a maximum of 5% of employee compensation. Total Company contributions to the 401(k) plan for the three months ended September 30, 2020 and 2019 were $188 and $45, respectively. Total Company contributions to the 401(k) plan for the nine months ended September 30, 2020 and 2019 were $449 and $281, respectively. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | (1 7 ) Subsequent Events On November 9, 2020, the Company implemented a strategic restructuring initiative, and corresponding reduction in workforce, aimed at reducing operating expenses, while maintaining key personnel needed to successfully commercialize ANJESO. The Company is taking this action in our efforts to control operating expenses during the pandemic. The restructuring initiative includes a reduction of workforce of approximately 40 positions. The Company estimates that it will incur approximately $1,500 of costs in connection with the reduction in workforce related to severance pay and other related termination benefits. The Company communicated the workforce reduction on November 9, 2020 and expects the majority of the costs to be incurred during the quarter ending December 31, 2020. The Company expects to complete the strategic restructuring initiative and corresponding reduction in workforce during the quarter ending December 31, 2020. |
Summary of Significant Accoun_2
Summary of Significant Accounting Principles (Policies) | 9 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation | (a) Basis of Presentation The accompanying unaudited consolidated and combined financial statements of the Company and its subsidiaries have been prepared in accordance with U.S. GAAP, for interim financial information and with the instructions of Form 10-Q and Article 10 of Regulation S-X and, therefore, do not include all of the information and notes required by U.S. GAAP for complete annual financial statements. In the opinion of management, the accompanying consolidated and combined financial statements include all normal and recurring adjustments (which consist primarily of accruals, estimates and assumptions that impact the financial statements) considered necessary to present fairly the Company’s results for the interim periods. Operating results for the three and nine months ended September 30, 2020 are not necessarily indicative of the results that may be expected for the full year ending December 31, 2020 . The accompanying unaudited interim |
Use of Estimates | (b) Use of Estimates The preparation of financial statements and the notes to the financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from such estimates. |
Cash and Cash Equivalents | (c) Cash and Cash Equivalents Cash and cash equivalents represent cash in banks and highly liquid short-term investments that have maturities of three months or less when acquired. These highly liquid short-term investments are both readily convertible to known amounts of cash and so near to their maturity that they present insignificant risk of changes in value because of the changes in interest rates. |
Property and Equipment | (d) Property and Equipment Property and equipment are recorded at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the assets, which are as follows: three to seven years for furniture and office equipment; six to ten years for manufacturing equipment; and the shorter of the lease term or useful life for leasehold improvements. Repairs and maintenance costs are expensed as incurred. |
Business Combinations | (e) Business Combinations In accordance with FASB ASC Topic 805, “ Business Combinations |
Goodwill and Intangible Assets | (f) Goodwill and Intangible Assets Goodwill represents the excess of purchase price over the fair value of net assets acquired by the Company. Goodwill is not amortized but assessed for impairment on an annual basis or more frequently if impairment indicators exist. The impairment model prescribes a one-step method for determining impairment. The one-step quantitative test calculates the amount of goodwill impairment as the excess of a reporting unit’s carrying amount over its fair value, not to exceed the total amount of goodwill allocated to the reporting unit. The Company has one reporting unit. As of September 30, 2020, the Company’s intangible asset is classified as an asset resulting from R&D activities. Historically, prior to receiving FDA approval, the intangible asset was classified as an IPR&D asset. Intangible assets related to IPR&D are considered indefinite-lived intangible assets and are assessed for impairment annually or more frequently if impairment indicators exist. If the associated research and development effort is abandoned, the related assets will be written-off, and the Company will record a noncash impairment loss on its Combined Statements of Operations. For those compounds that reach commercialization, the IPR&D assets will be amortized over their estimated useful lives The Company performs its annual goodwill impairment test as of November 30 th |
Revenue Recognition | (g) Revenue Recognition Subsequent to regulatory approval for ANJESO from the FDA, the Company began selling ANJESO in the U.S. through a single third-party logistics provider (“3PL”) which takes title to and control of the goods. The Company recognizes revenue from ANJESO product sales at the point the title to the product is transferred to the customer and the customer obtains control of the product. The transaction price that is recognized as revenue for products includes an estimate of variable consideration for reserves, which result from discounts, returns, chargebacks, rebates and other allowances that are offered within contracts between us and our end-customers, wholesalers, group purchasing organizations and other indirect customers. Our payment terms are generally between thirty to ninety days. The Company’s estimates of variable consideration and determination of whether to include estimated amounts in the transaction price are based largely on an assessment of its anticipated performance and all information (historical, current and forecasted) that is reasonably available. These reserves reflect the Company’s best estimate of the amount of consideration to which the Company is entitled based on the terms of the contracts. The amount of variable consideration that is included in the transaction price may be constrained and is included in the net sales price only to the extent that is considered probable that a significant reversal in the amount of the cumulative revenue recognized will not occur in a future period. Actual amounts of consideration ultimately received may differ from the Company’s estimates. If actual results in the future vary from the Company’s estimates, the Company will adjust these estimates, which would affect net product revenue and earnings in the period such variances become known. |
Concentration of Credit Risk | ( h ) Concentration of Credit Risk Financial instruments that potentially subject the Company to significant concentration of credit risk consist primarily of cash, cash equivalents and accounts receivable. The Company manages its cash and cash equivalents based on established guidelines relative to diversification and maturities to maintain safety and liquidity. The Company’s accounts receivable balance is compromised solely from transactions with the Company’s 3PL. |
Research and Development | ( i ) Research and Development Research and development costs for the Company’s proprietary products/product candidates are charged to expense as incurred. Research and development expenses consist primarily of funds paid to third parties for the provision of services for pre-commercialization and manufacturing scale-up activities, drug development, pre-clinical activities, clinical trials, statistical analysis and report writing and regulatory filing fees and compliance costs. 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 expenses relating to these costs. Upfront and milestone payments made to third parties who perform research and development services on the Company’s behalf are expensed as services are rendered. Costs incurred in obtaining product technology licenses are charged to research and development expense as acquired IPR&D if the technology licensed has not reached technological feasibility and has no alternative future use. |
Stock-Based Awards | ( j ) Stock-Based Awards Baudax Awards Share-based compensation included in the consolidated financial statements following the Separation is based upon the Baudax Bio, Inc. 2019 Equity Incentive Plan (the “2019 Plan”). The plan includes grants of stock options, time-based vesting restricted stock units (“RSUs”) and performance-based RSUs. The Company measures employee stock-based awards at grant-date fair value and recognizes employee compensation expense on a straight-line basis over the vesting period of the award. The Company accounts for forfeitures as they occur. Determining the appropriate fair value of stock options requires the input of subjective assumptions, including the expected life of the option and expected stock price volatility. The Company uses the Black-Scholes option pricing model to value its stock option awards. The assumptions used in calculating the fair value of stock-based awards represent management’s best estimates and involve inherent uncertainties and the application of management’s judgment. As a result, if factors change and/or management uses different assumptions, stock-based compensation expense could be materially different for future awards. The expected life of stock options was estimated using the “simplified method,” as the Company has limited historical information to develop reasonable expectations about future exercise patterns and post-vesting employment termination behavior for its stock options grants. The simplified method is based on the average of the vesting tranches and the contractual life of each grant. For stock price volatility, the Company uses an average of its peer group’s volatility in order to estimate future stock price trends. The risk-free interest rate is based on U.S. Treasury notes with a term approximating the expected life of the option. Recro Awards The Recro Pharma, Inc. 2018 Amended and Restated Equity Incentive Plan (the “Recro Equity Plan”) includes stock options, time-based vesting RSUs and performance-based vesting RSUs granted to the Company’s employees prior to the Separation. The consolidated and combined financial statements reflect share-based compensation expense based on an allocation of a portion of Recro share-based compensation issued to the Company’s employees based on where their services are performed. Recro measures employee stock-based awards at grant-date fair value and recognizes employee compensation expense on a straight-line basis over the vesting period of the award. Forfeitures are accounted for as they occur. Determining the appropriate fair value of stock options requires the input of subjective assumptions, including the expected life of the option and expected stock price volatility. Recro uses the Black-Scholes option pricing model to value its stock option awards. The assumptions used in calculating the fair value of stock-based awards represent management’s best estimates and involve inherent uncertainties and the application of management’s judgment. As a result, if factors change and/or management uses different assumptions, stock-based compensation expense could be materially different for future awards. The expected life of stock options was estimated using the “simplified method,” as Recro has limited historical information to develop reasonable expectations about future exercise patterns and post-vesting employment termination behavior for its stock options grants. The simplified method is based on the average of the vesting tranches and the contractual life of each grant. For stock price volatility, Recro uses the historical volatility of its publicly traded stock in order to estimate future stock price trends. The risk-free interest rate is based on U.S. Treasury notes with a term approximating the expected life of the option. |
Income Taxes | ( k ) Income Taxes The income tax amounts in these consolidated and combined financial statements for periods prior to the Separation have been calculated based on a separate return methodology and presented as if the Company was a standalone taxpayer in each of its tax jurisdictions. Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis, operating losses and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in operations in the period that includes the enactment date. A valuation allowance is recorded to the extent it is more likely than not that some portion or all of the deferred tax assets will not be realized. Because of the Company’s history of losses as a standalone entity, a full valuation allowance is recorded against deferred tax assets in all periods presented. Unrecognized income tax benefits represent income tax positions taken on income tax returns that have not been recognized in the consolidated and combined financial statements. The Company recognizes the benefit of an income tax position only if it is more likely than not (greater than 50%) that the tax position will be sustained upon tax examination, based solely on the technical merits of the tax position. Otherwise, no benefit is recognized. The tax benefits recognized are measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. The Company does not anticipate significant changes in the amount of unrecognized income tax benefits over the next year. |
Net Income/(Loss) Per Common Share | ( l ) Net Income (Loss) Per Common Share Basic net income (loss) per common share is determined by dividing net income (loss) applicable to common shareholders by the weighted average common shares outstanding during the period. Outstanding warrants, common stock options and unvested restricted stock units are excluded from the calculation of diluted net income (loss) per share when their effect would be anti-dilutive. For purposes of calculating diluted income ( loss ) per common share, the denominator includes both the weighted average common shares outstanding and the number of common stock equivalents if the inclusion of such common stock equivalents would be dilutive. Prior to the distribution date of November 21, 2019, there were no Baudax Bio shares outstanding, as such, the shares outstanding immediately after the Distribution were used to calculate the net loss per share for all pre-Separation periods presented. The following table reconciles the shares used in the calculation of basic net income per share to those used for diluted net income per share: Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Basic and Diluted Income (Loss) Per Share Net income (loss) $ 11,685 $ (10,315 ) $ (59,058 ) $ (25,232 ) Weighted average common shares outstanding, basic 18,374,604 9,350,709 15,366,861 9,350,709 Dilutive effect of equity awards, based on the treasury stock method 393,772 — — — Weighted average common shares outstanding, diluted 18,768,376 9,350,709 15,366,861 9,350,709 The following potentially dilutive securities have been excluded from the computations of diluted weighted average shares outstanding as they would be anti-dilutive: Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Options and restricted stock units outstanding 2,098,316 — 1,694,889 — Warrants 15,107,100 — 15,199,605 — Amounts in the table above reflect the common stock equivalents of the noted instruments. For the three and nine months ended September 30, 2019, there were no outstanding warrants, common stock options or unvested restricted stock units. |
Recent Accounting Pronouncements | ( m ) Recent Accounting Pronouncements Recently Adopted Accounting Pronouncements In February 2016, the FASB issued ASU No. 2016-02, “ Leases (Topic 842) Targeted Improvements Note 8. In August 2018, the FASB issued ASU 2018-13, “ Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement, Fair Value Measurement years, beginning after December 15, 2019 with early adoption permitted. The Company adopted this guidance as of January 1, 2020 . The adoption did no t have a material impact to the Company or its disclosures. Accounting Pronouncements Not Yet Adopted In June 2016, the FASB issued ASU No. 2016-13, “ Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments,” In August 2020, the FASB issued ASU No. 2020-06, “Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity's Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity's Own Equity,” or ASU 2020-06. ASU 2020-06 simplifies accounting for convertible instruments by removing major separation models required under current GAAP. ASU 2020-06 removes certain settlement conditions that are required for equity contracts to qualify for the derivative scope exception, which will permit more equity contracts to qualify for such exception. ASU 2020-06 also simplifies the diluted earnings per share calculation in certain areas. ASU 2020-06 is effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years and early adoption is permitted in annual reporting periods ending after December 15, 2020. The Company is currently assessing the impact of adopting this standard. |
Summary of Significant Accoun_3
Summary of Significant Accounting Principles (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
Summary of Calculation of Basic Net Income Per Share | The following table reconciles the shares used in the calculation of basic net income per share to those used for diluted net income per share: Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Basic and Diluted Income (Loss) Per Share Net income (loss) $ 11,685 $ (10,315 ) $ (59,058 ) $ (25,232 ) Weighted average common shares outstanding, basic 18,374,604 9,350,709 15,366,861 9,350,709 Dilutive effect of equity awards, based on the treasury stock method 393,772 — — — Weighted average common shares outstanding, diluted 18,768,376 9,350,709 15,366,861 9,350,709 |
Schedule of Anti-Dilutive Securities | The following potentially dilutive securities have been excluded from the computations of diluted weighted average shares outstanding as they would be anti-dilutive: Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Options and restricted stock units outstanding 2,098,316 — 1,694,889 — Warrants 15,107,100 — 15,199,605 — |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Classification of Assets and Liabilities Measured at Fair Value on Recurring Basis | The Company has classified assets and liabilities measured at fair value on a recurring basis as follows: Fair value measurements at reporting date using Quoted prices in active markets for identical assets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) At September 30, 2020: Assets: Cash equivalents (See Note 5) Money market mutual funds $ 22,910 $ — $ — Total cash equivalents $ 22,910 $ — $ — Liabilities: Warrants (See Note 13(c)) $ — $ — $ 10,228 Contingent consideration (See Note 12(b)) — — 78,110 $ — $ — $ 88,338 At December 31, 2019: Assets: Cash equivalents (See Note 5) Money market mutual funds $ 16,514 $ — $ — Total cash equivalents $ 16,514 $ — $ — Liabilities: Contingent consideration (See Note 12(b)) $ — $ — $ 66,358 $ — $ — $ 66,358 |
Reconciliation of Liabilities Measured at Fair Value on Recurring Basis Using Unobservable Inputs | The Company developed certain of its own assumptions to determine the value of the warrants that do not have observable inputs or available market data to support the fair value. This method of valuation involves using inputs such as the fair value of the Company’s common stock, stock price volatility, the contractual term of the warrants, risk free interest rates and dividend yield. Due to the nature of these inputs, the valuation of the warrants is considered a Level 3 measurement. The reconciliation of liabilities measured at fair value on a recurring basis using unobservable inputs (Level 3) is as follows: Warrants Contingent Consideration Balance at December 31, 2019 $ — $ 66,358 Additions 8,111 — Exercise of warrants (746 ) — Payment of contingent consideration — (2,500 ) Remeasurement 2,863 14,252 Total at September 30, 2020 $ 10,228 $ 78,110 Current portion as of September 30, 2020 $ — $ 10,677 Long-term portion as of September 30, 2020 10,228 67,433 |
Cash Equivalents (Tables)
Cash Equivalents (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Cash And Cash Equivalents [Abstract] | |
Summary of Cash Equivalents | September 30, 2020 Amortized Gross Unrealized Estimated Description Cost Gain Loss Fair Value Money market mutual funds $ 22,910 $ — $ — $ 22,910 Total cash equivalents $ 22,910 $ — $ — $ 22,910 December 31, 2019 Amortized Gross Unrealized Estimated Description Cost Gain Loss Fair Value Money market mutual funds $ 16,514 $ — $ — $ 16,514 Total cash equivalents $ 16,514 $ — $ — $ 16,514 |
Inventory (Tables)
Inventory (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | Inventory was as follows: September 30, 2020 December 31, 2019 Raw materials $ 67 $ — Sub-assemblies 796 — Finished goods 921 — $ 1,784 $ — |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Property Plant And Equipment [Abstract] | |
Schedule of Property, Plant and Equipment | Property, plant and equipment consists of the following: September 30, 2020 December 31, 2019 Building and improvements $ 196 $ 196 Furniture, office and computer equipment 935 902 Manufacturing and laboratory equipment 717 717 Construction in progress 4,142 3,846 5,990 5,661 Less: accumulated depreciation 1,155 840 Property, plant and equipment, net $ 4,835 $ 4,821 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Leases [Abstract] | |
Schedule of Undiscounted Future Lease Payments for Non-Cancellable Operating Leases | As of September 30, 2020, undiscounted future lease payments for non-cancellable operating leases are as follows: Lease payments Remainder of 2020 $ 127 2021 367 2022 373 Total lease payments 867 Less imputed interest (172 ) Total operating lease liability $ 695 |
Schedule of Components Least Cost | The components of the Company’s lease cost were as follows: Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Operating lease cost $ 87 $ 121 $ 306 $ 363 Short-term lease cost 38 - 68 14 Total lease cost $ 125 $ 121 $ 374 $ 377 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Summary of Balance of Intangible Assets | The following represents the balance of the intangible assets at September 30, 2020: Cost Accumulated Amortization Net Intangible Assets Asset resulting from R&D activities $ 26,400 $ 1,502 $ 24,898 Total $ 26,400 $ 1,502 $ 24,898 |
Summary of Future Amortization Expense | As of September 30, 2020 Amortization Remainder of 2020 $ 644 2021 2,576 2022 2,576 2023 2,576 2024 and thereafter 16,526 Total $ 24,898 |
Accrued Expenses and Other Cu_2
Accrued Expenses and Other Current Liabilities (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Payables And Accruals [Abstract] | |
Schedule of Accrued Expenses and Other Current Liabilities | Accrued expenses and other current liabilities consist of the following: September 30, December 31, 2020 2019 Payroll and related costs $ 3,936 $ 2,181 Inventory 1,014 0 Professional and consulting fees 667 209 Research and development costs 272 538 Guarantee liability 443 548 Interest payable 119 — Other 841 374 $ 7,292 $ 3,850 |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of Components of Carrying Value of Debt | The following table summarizes the components of the carrying value of debt as of September 30, 2020: Paycheck Protection Program Loan $ 1,537 Credit Agreement 10,000 Unamortized deferred issuance costs (2,637 ) Exit fee accretion 24 Total debt $ 8,924 Current portion as of September 30, 2020 $ 171 Long-term portion, net as of September 30, 2020 8,753 |
Capital Structure (Tables)
Capital Structure (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Equity [Abstract] | |
Schedule of Warrants Outstanding to Purchase Shares Common Stock Liability | As of September 30, 2020, the Company had the following warrants outstanding to purchase shares of the Company’s common stock: Number of Shares Exercise Price per Share Expiration Date Series A Warrants 7,692,308 $ 4.59 March 26, 2025 Series B Warrants 6,887,692 $ 3.25 April 26, 2021 MAM Eagle Lender Warrant 527,100 $ 4.59 May 29, 2027 |
Summary of Fair Value Assumptions Black Scholes Option Pricing Model | The following table summarizes the fair value and the assumptions used for the Black-Scholes option-pricing model for the liability classified warrants. September 30, 2020 Series A Warrants Series B Warrants Fair value $ 6,857 $ 3,371 Expected dividend yield — % — % Expected volatility 73.86 % 101.47 % Risk-free interest rates .28 % .11 % Remaining contractual term 4.5 years 0.6 years |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Fair Value of Options Estimated on Date of Grant Using Black-Scholes Option Pricing Model | Under the 2019 Plan, the fair value of the Baudax Bio options was estimated on the date of grant using a Black-Scholes option pricing model with the following weighted average assumptions: September 30, 2020 Range of expected option life 6 years Expected volatility 73.77% Risk-free interest rate .41% Expected dividend yield — Under the Recro Equity Plan for the nine months ended September 30, 2019, the fair value of the options granted to employees of the Company was estimated on the date of grant using a Black-Scholes option pricing model with the following weighted average assumptions: September 30, 2019 Range of expected option life 6 years Expected volatility 79.96% Risk-free interest rate 2.60% Expected dividend yield — |
Summary of Stock Option Activity | The following table summarizes Baudax Bio stock option activity during the nine months ended September 30, 2020: Number of shares Weighted average exercise price Weighted average remaining contractual life Balance, December 31, 2019 643,879 $ 6.33 9.9 years Granted 840,299 $ 3.48 Expired/forfeited/cancelled (22,500 ) $ 4.15 Balance, September 30, 2020 1,461,678 $ 4.72 9.5 years Vested 120,720 $ 6.33 9.2 years Vested and expected to vest 1,461,678 $ 4.72 9.5 years |
Summary of RSUs Activity | The following table summarizes the Baudax Bio RSUs activity during the nine months ended September 30, 2020: Number of shares Balance, December 31, 2019 1,380,030 Granted 377,351 Vested and settled (50,240 ) Expired/forfeited/cancelled (6,000 ) Balance, September 30, 2020 1,701,141 Expected to vest 1,701,141 |
Background - Additional Informa
Background - Additional Information (Details) - Recro - USD ($) $ in Thousands | Nov. 21, 2019 | Nov. 15, 2019 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 |
Organization Consolidation And Presentation Of Financial Statements [Line Items] | |||||
Right to receive common stock | 1 | ||||
Number of shares held for distribution of new shares | 2.5 | ||||
CDMO | |||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | |||||
General and administrative | $ 1,516 | $ 6,467 | |||
Separation | |||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | |||||
Right to receive common stock | 1 | ||||
Number of shares held for distribution of new shares | 2.5 | ||||
Cash received from separation | $ 19,000 |
Development-Stage Risks and L_2
Development-Stage Risks and Liquidity - Additional Information (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | Dec. 31, 2019 | |
Business Developments Risks And Uncertainties Liquidity [Line Items] | ||
Accumulated deficit | $ 95,278 | $ 36,220 |
Recro | ||
Business Developments Risks And Uncertainties Liquidity [Line Items] | ||
Contribution received immediately prior to Distribution | $ 19,000 |
Summary of Significant Accoun_4
Summary of Significant Accounting Principles - Additional Information (Details) | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2020USD ($)shares | Mar. 31, 2020USD ($) | Sep. 30, 2019shares | Sep. 30, 2020USD ($)Unitshares | Sep. 30, 2019shares | Dec. 31, 2019shares | Nov. 20, 2019shares | Jan. 01, 2019USD ($) | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Number of reportable unit | Unit | 1 | |||||||
Description of payment terms | Our payment terms are generally between thirty to ninety days. | |||||||
Shares outstanding | shares | 18,374,604 | 18,374,604 | 9,350,709 | 0 | ||||
Operating lease liability | $ 695,000 | $ 695,000 | ||||||
ASU 2016-02 | ||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Right-of-use asset | $ 1,174,000 | |||||||
Operating lease liability | $ 1,219,000 | |||||||
Change in accounting principle, accounting standards update, adopted | true | true | ||||||
Change in accounting principle, accounting standards update, adoption date | Jan. 1, 2019 | Jan. 1, 2019 | ||||||
Change in accounting principle, accounting standards update, immaterial effect | false | false | ||||||
ASU 2018-13 | ||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Change in accounting principle, accounting standards update, adopted | true | true | ||||||
Change in accounting principle, accounting standards update, adoption date | Jan. 1, 2020 | Jan. 1, 2020 | ||||||
Change in accounting principle, accounting standards update, immaterial effect | true | true | ||||||
Stock Options | Restricted Stock Units | ||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Anti-dilutive securities excluded from computation of diluted weighted average shares outstanding | shares | 2,098,316 | 0 | 1,694,889 | 0 | ||||
R&D | ||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Intangible asset, useful life | 10 years | |||||||
Goodwill impairment | $ 0 | $ 0 | ||||||
Intangible assets impairment | $ 0 | $ 0 | ||||||
Leasehold Improvements | ||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Property, plant and equipment useful life | the shorter of the lease term or useful life | |||||||
Minimum | ||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Payments term | 30 days | |||||||
Minimum | Furniture and Office Equipment | ||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Property, plant and equipment estimated useful lives | 3 years | |||||||
Minimum | Manufacturing Equipment | ||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Property, plant and equipment estimated useful lives | 6 years | |||||||
Maximum | ||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Payments term | 90 days | |||||||
Maximum | Furniture and Office Equipment | ||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Property, plant and equipment estimated useful lives | 7 years | |||||||
Maximum | Manufacturing Equipment | ||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Property, plant and equipment estimated useful lives | 10 years |
Summary of Calculation of Basic
Summary of Calculation of Basic Net Income Per Share (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Basic and Diluted Income (Loss) Per Share | ||||||||
Net income (loss) | $ 11,685 | $ (30,445) | $ (40,298) | $ (10,315) | $ (10,582) | $ (4,335) | $ (59,058) | $ (25,232) |
Weighted average common shares outstanding, basic | 18,374,604 | 9,350,709 | 15,366,861 | 9,350,709 | ||||
Dilutive effect of equity awards, based on the treasury stock method | 393,772 | |||||||
Weighted average common shares outstanding, diluted | 18,768,376 | 9,350,709 | 15,366,861 | 9,350,709 |
Summary of Significant Accoun_5
Summary of Significant Accounting Principles - Schedule of Anti-Dilutive Securities (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Stock Options | Restricted Stock Units | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Anti-dilutive securities excluded from computation of diluted weighted average shares outstanding | 2,098,316 | 0 | 1,694,889 | 0 |
Warrant | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Anti-dilutive securities excluded from computation of diluted weighted average shares outstanding | 15,107,100 | 15,199,605 |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments - Classification of Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) - Fair Value, Recurring - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Assets: | ||
Total cash equivalents | $ 22,910 | $ 16,514 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Money Market Mutual Funds | ||
Assets: | ||
Total cash equivalents | 22,910 | 16,514 |
Significant Unobservable Inputs (Level 3) | ||
Liabilities: | ||
Warrants | 10,228 | |
Contingent consideration | 78,110 | 66,358 |
Liabilities | $ 88,338 | $ 66,358 |
Fair Value of Financial Instr_4
Fair Value of Financial Instruments - Reconciliation of Liabilities Measured at Fair Value on Recurring Basis Using Unobservable Inputs (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2020USD ($) | |
Warrant | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |
Additions | $ 8,111 |
Exercise of warrants | (746) |
Remeasurement | 2,863 |
Total at September 30, 2020 | 10,228 |
Long-term portion as of September 30, 2020 | 10,228 |
Contingent Consideration | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |
Balance at December 31, 2019 | 66,358 |
Payment of contingent consideration | (2,500) |
Remeasurement | 14,252 |
Total at September 30, 2020 | 78,110 |
Current portion as of September 30, 2020 | 10,677 |
Long-term portion as of September 30, 2020 | $ 67,433 |
Fair Value of Financial Instr_5
Fair Value of Financial Instruments - Additional Information (Details) - Discount Rate | Sep. 30, 2020 |
Minimum | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Risk-adjusted discount rate | 0.1542 |
Maximum | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Risk-adjusted discount rate | 0.3394 |
Weighted Average | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Risk-adjusted discount rate | 0.2335 |
Cash Equivalents - Summary of C
Cash Equivalents - Summary of Cash Equivalents (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Cash And Cash Equivalents [Line Items] | ||
Amortized Cost | $ 22,910 | $ 16,514 |
Estimated Fair Value | 22,910 | 16,514 |
Money Market Mutual Funds | ||
Cash And Cash Equivalents [Line Items] | ||
Amortized Cost | 22,910 | 16,514 |
Estimated Fair Value | $ 22,910 | $ 16,514 |
Inventory - Schedule of Invento
Inventory - Schedule of Inventory (Details) $ in Thousands | Sep. 30, 2020USD ($) |
Inventory Disclosure [Abstract] | |
Raw materials | $ 67 |
Sub-assemblies | 796 |
Finished goods | 921 |
Inventory | $ 1,784 |
Property, Plant and Equipment -
Property, Plant and Equipment - Schedule of Property, Plant and Equipment (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 5,990 | $ 5,661 |
Less: accumulated depreciation | 1,155 | 840 |
Property, plant and equipment, net | 4,835 | 4,821 |
Buildings and Improvements | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | 196 | 196 |
Furniture, Office and Computer Equipment | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | 935 | 902 |
Manufacturing and Laboratory Equipment | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | 717 | 717 |
Construction in Progress | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 4,142 | $ 3,846 |
Property, Plant and Equipment_2
Property, Plant and Equipment - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Property Plant And Equipment [Abstract] | ||||
Depreciation expense | $ 104 | $ 123 | $ 315 | $ 369 |
Leases - Additional Information
Leases - Additional Information (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Leases [Abstract] | ||
Operating leases with remaining lease term | 2 years | |
Lessee, operating lease, option to extend | Periods covered by an option to extend the lease were included in the non-cancellable lease term when exercise of the option was determined to be reasonably certain. | |
Lessee, operating lease, existence of option to extend | true | |
Operating lease, weighted average remaining term | 2 years | |
Operating lease, weighted average discount rate percent | 16.00% | |
Cash paid for amounts included in measurement of lease liabilities | $ 78 | $ 344 |
Leases - Schedule of Undiscount
Leases - Schedule of Undiscounted Future Lease Payments for Non-Cancellable Operating Leases (Details) $ in Thousands | Sep. 30, 2020USD ($) |
Leases [Abstract] | |
Remainder of 2020 | $ 127 |
2021 | 367 |
2022 | 373 |
Total lease payments | 867 |
Less imputed interest | (172) |
Total operating lease liability | $ 695 |
Leases - Schedule of Components
Leases - Schedule of Components Least Cost (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Leases [Abstract] | ||||
Operating lease cost | $ 87 | $ 121 | $ 306 | $ 363 |
Short-term lease cost | 38 | 68 | 14 | |
Total lease cost | $ 125 | $ 121 | $ 374 | $ 377 |
Intangible Assets - Summary of
Intangible Assets - Summary of Balance of Intangible Assets (Details) $ in Thousands | Sep. 30, 2020USD ($) |
Finite-Lived Intangible Assets [Line Items] | |
Cost | $ 26,400 |
Accumulated Amortization | 1,502 |
Net Intangible Assets | 24,898 |
Asset Resulting from R&D Activities | |
Finite-Lived Intangible Assets [Line Items] | |
Cost | 26,400 |
Accumulated Amortization | 1,502 |
Net Intangible Assets | $ 24,898 |
Intangible Assets - Additional
Intangible Assets - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Goodwill And Intangible Assets Disclosure [Abstract] | ||||
Amortization expense | $ 643,000 | $ 0 | $ 1,502,000 | $ 0 |
Intangible Assets - Summary o_2
Intangible Assets - Summary of Future Amortization Expense (Details) $ in Thousands | Sep. 30, 2020USD ($) |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Remainder of 2020 | $ 644 |
2021 | 2,576 |
2022 | 2,576 |
2023 | 2,576 |
2024 and thereafter | 16,526 |
Net Intangible Assets | $ 24,898 |
Accrued Expenses and Other Cu_3
Accrued Expenses and Other Current Liabilities - Schedule of Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Payables And Accruals [Abstract] | ||
Payroll and related costs | $ 3,936 | $ 2,181 |
Inventory | 1,014 | 0 |
Professional and consulting fees | 667 | 209 |
Research and development costs | 272 | 538 |
Guarantee liability | 443 | 548 |
Interest payable | 119 | |
Other | 841 | 374 |
Total accrued expenses and other current liabilities | $ 7,292 | $ 3,850 |
Debt - Schedule of Components o
Debt - Schedule of Components of Carrying Value of Debt (Details) $ in Thousands | Sep. 30, 2020USD ($) |
Debt Instrument [Line Items] | |
Unamortized deferred issuance costs | $ (2,637) |
Exit fee accretion | 24 |
Total debt | 8,924 |
Current portion as of September 30, 2020 | 171 |
Long-term portion, net as of September 30, 2020 | 8,753 |
Credit Agreement | |
Debt Instrument [Line Items] | |
Credit Agreement | 10,000 |
Paycheck Protection Program Loan | |
Debt Instrument [Line Items] | |
Paycheck Protection Program Loan | $ 1,537 |
Debt - Additional Information (
Debt - Additional Information (Details) - USD ($) | May 29, 2020 | Apr. 13, 2020 | Sep. 30, 2020 | Sep. 30, 2020 |
Debt Instrument [Line Items] | ||||
Change in warrant valuation | $ (11,182,000) | $ 2,863,000 | ||
Credit Agreement | ||||
Debt Instrument [Line Items] | ||||
Line of credit facility, maximum principal amount | $ 50,000,000 | |||
Line of credit facility, drawn on or before date | May 29, 2025 | |||
Term loan, interest rate | 13.50% | |||
Term loan, frequency of payments | monthly | |||
Term loan, interest payment period | 3 years | |||
Term loan, extended expiration date | May 29, 2026 | |||
EBITDA | $ 10,000,000 | |||
Amortization period | 36 months | |||
Term loan, exit fee due, principal amount advanced by lenders | $ 700,000 | |||
Term loan, exit fees | $ 700,000 | |||
Term loan, payoff period | 6 months | |||
Exit fee percentage | 2.50% | 2.50% | ||
Current outstanding loan balance | $ 250,000 | $ 250,000 | ||
Financial covenants, minimum liquidity requirement | $ 5,000,000 | |||
Debt issuance costs | 1,496,000 | |||
Change in warrant valuation | $ 1,423,000 | |||
Effective interest rate | 22.66% | 22.66% | ||
Debt issuance cost amortization | $ 211,000 | $ 281,000 | ||
Credit Agreement | MAM Eagle Lender, LLC | Common Stock | ||||
Debt Instrument [Line Items] | ||||
Warrants issued to purchase shares of common stock | 527,100 | |||
Exercise price of warrants | $ 4.59 | |||
Warrants exercisable date | May 29, 2027 | |||
Credit Agreement | After Third But Prior To Fourth Anniversary of Tranche One, Two, Three, Four or Five Loans | ||||
Debt Instrument [Line Items] | ||||
Term loan, prepayment of principal percentage | 3.00% | |||
Maximum | Credit Agreement | ||||
Debt Instrument [Line Items] | ||||
Term loan, exit fee due, percentage of principal amount advanced by lenders | 2.50% | |||
Maximum | Credit Agreement | On or Prior To Third Anniversary of Tranche One, Two, Three, Four or Five Loans | ||||
Debt Instrument [Line Items] | ||||
Term loan, prepayment of principal percentage | 5.00% | |||
Paycheck Protection Program Loan | PNC Bank | ||||
Debt Instrument [Line Items] | ||||
Proceeds from loan | $ 1,537,000 | |||
Debt instrument, term | 2 years | |||
Debt instrument, maturity date | May 8, 2022 | |||
Debt instrument, interest rate | 1.00% | |||
Debt instrument, date of first required payment | Sep. 15, 2021 | |||
Paycheck Protection Program Loan | PNC Bank | Minimum | ||||
Debt Instrument [Line Items] | ||||
Percentage of payroll costs | 60.00% | |||
Paycheck Protection Program Loan | PNC Bank | Maximum | ||||
Debt Instrument [Line Items] | ||||
Repayment of unforgiven amount, threshold | $ 1,100,000 | |||
Tranche One Loans | Credit Agreement | ||||
Debt Instrument [Line Items] | ||||
Line of credit facility, maximum principal amount | $ 10,000,000 | |||
Term Loans | Credit Agreement | ||||
Debt Instrument [Line Items] | ||||
Line of credit facility, maximum principal amount | 40,000,000 | |||
Tranche Two Loans | Credit Agreement | ||||
Debt Instrument [Line Items] | ||||
Line of credit facility, maximum principal amount | $ 5,000,000 | |||
Line of credit facility, drawn on or before date | Aug. 29, 2021 | |||
Tranche Two Loans | Minimum | Credit Agreement | ||||
Debt Instrument [Line Items] | ||||
Net revenue | $ 5,000,000 | |||
Tranche Three Loans | Credit Agreement | ||||
Debt Instrument [Line Items] | ||||
Line of credit facility, maximum principal amount | $ 5,000,000 | |||
Line of credit facility, drawn on or before date | Nov. 29, 2021 | |||
Tranche Three Loans | Minimum | Credit Agreement | ||||
Debt Instrument [Line Items] | ||||
Net revenue | $ 10,000,000 | |||
Tranche Four Loans | Credit Agreement | ||||
Debt Instrument [Line Items] | ||||
Line of credit facility, maximum principal amount | $ 10,000,000 | |||
Line of credit facility, drawn on or before date | Aug. 29, 2022 | |||
Tranche Four Loans | Minimum | Credit Agreement | ||||
Debt Instrument [Line Items] | ||||
Net revenue | $ 20,000,000 | |||
Tranche Five Loans | Credit Agreement | ||||
Debt Instrument [Line Items] | ||||
Line of credit facility, maximum principal amount | $ 20,000,000 | |||
Line of credit facility, drawn on or before date | Mar. 1, 2023 | |||
Tranche Five Loans | Minimum | Credit Agreement | ||||
Debt Instrument [Line Items] | ||||
Net revenue | $ 100,000,000 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) | Aug. 17, 2020USD ($) | Apr. 10, 2015USD ($) | Jun. 30, 2019USD ($) | Mar. 31, 2019USD ($) | Sep. 30, 2020USD ($)MilestonePayment | Sep. 30, 2020EUR (€)MilestonePayment | Jun. 30, 2021USD ($) | Dec. 20, 2020USD ($) | Aug. 31, 2020USD ($) | Aug. 18, 2020USD ($) | Jun. 30, 2017USD ($) |
Purchase Commitment | |||||||||||
Supply Commitment [Line Items] | |||||||||||
Purchase commitment non cancelable and cancelable | $ 10,840,000 | ||||||||||
Alkermes Plc | Amendment to Purchase and Sale Agreement | |||||||||||
Supply Commitment [Line Items] | |||||||||||
Milestone development earn-out consideration payable | $ 5,000,000 | $ 2,500,000 | |||||||||
Payment for one-time non-refundable and non-creditable fee | $ 285,000 | ||||||||||
Collaborative arrangements milestone payments upon achievement of regulatory and sales milestones | 12,500,000 | ||||||||||
Alkermes Plc | Amendment to Purchase and Sale Agreement | Scenario Forecast | |||||||||||
Supply Commitment [Line Items] | |||||||||||
Milestone development earn-out consideration payable | $ 1,440,000 | $ 1,060,000 | |||||||||
U.S | Cornell University | Neuromuscular Blocking Agents License Agreement | |||||||||||
Supply Commitment [Line Items] | |||||||||||
Regulatory approval and commercialization milestones | $ 5,000,000 | ||||||||||
European | Cornell University | Neuromuscular Blocking Agents License Agreement | |||||||||||
Supply Commitment [Line Items] | |||||||||||
Regulatory approval and commercialization milestones | $ 3,000,000 | ||||||||||
Maximum | Executive Officer | |||||||||||
Supply Commitment [Line Items] | |||||||||||
Aggregate annual base salaries of employment agreements | $ 1,327,000 | ||||||||||
Recro | Alkermes Transaction | |||||||||||
Supply Commitment [Line Items] | |||||||||||
Collaborative arrangements, milestone payments upon achievement of regulatory and sales milestones | $ 140,000,000 | ||||||||||
Recro | Alkermes Transaction | Regulatory Approval and Net Sales Milestones | |||||||||||
Supply Commitment [Line Items] | |||||||||||
Collaborative arrangements, milestone payments upon achievement of regulatory and sales milestones | $ 50,000,000 | ||||||||||
Collaborative arrangements, milestone payments period | 7 years | ||||||||||
Recro | Alkermes Plc | Amendment to Purchase and Sale Agreement | Alkermes Transaction | Contingent Consideration, First Component | |||||||||||
Supply Commitment [Line Items] | |||||||||||
Business acquisition contingent consideration, first milestone payment | $ 5,000,000 | ||||||||||
Business acquisition contingent consideration possible milestone payments | $ 5,000,000 | ||||||||||
Recro | Alkermes Plc | Amendment to Purchase and Sale Agreement | Alkermes Transaction | Contingent Consideration, Third Component | |||||||||||
Supply Commitment [Line Items] | |||||||||||
Minimum milestone payments percentage | 60.00% | 60.00% | |||||||||
Recro | Alkermes Plc | Amendment to Purchase and Sale Agreement | Alkermes Transaction | Contingent Consideration, Fourth Component | |||||||||||
Supply Commitment [Line Items] | |||||||||||
Maximum royalty payment percentage | 30.00% | 30.00% | |||||||||
Recro | Alkermes Plc | Amendment to Purchase and Sale Agreement | Alkermes Transaction | Milestone Payments Due, Following Regulatory Approval | Contingent Consideration, Second Component | |||||||||||
Supply Commitment [Line Items] | |||||||||||
Business acquisition contingent consideration possible milestone payments | $ 5,000,000 | ||||||||||
Recro | Alkermes Plc | Amendment to Purchase and Sale Agreement | Alkermes Transaction | Milestone Payments Due, Beginning on First Anniversary of Regulatory Approval | Contingent Consideration, Second Component | |||||||||||
Supply Commitment [Line Items] | |||||||||||
Business acquisition contingent consideration possible milestone payments | $ 45,000,000 | ||||||||||
Business acquisition, contingent consideration, number of equal annual milestone payments | MilestonePayment | 7 | 7 | |||||||||
Business acquisition, contingent consideration, equal annual milestone payments | $ 6,400,000 | ||||||||||
Recro | Minimum | Alkermes Plc | Amendment to Purchase and Sale Agreement | Alkermes Transaction | Contingent Consideration, Fourth Component | |||||||||||
Supply Commitment [Line Items] | |||||||||||
Royalty payment percentage | 10.00% | 10.00% | |||||||||
Recro | Maximum | Alkermes Plc | Amendment to Purchase and Sale Agreement | Alkermes Transaction | Contingent Consideration, Second Component | |||||||||||
Supply Commitment [Line Items] | |||||||||||
Business acquisition, contingent consideration, milestone payments due period following regulatory approval | 180 days | 180 days | |||||||||
Recro | Maximum | Alkermes Plc | Amendment to Purchase and Sale Agreement | Alkermes Transaction | Contingent Consideration, Fourth Component | |||||||||||
Supply Commitment [Line Items] | |||||||||||
Royalty payment percentage | 12.00% | 12.00% | |||||||||
Recro | Dexmedetomidine License Agreement | |||||||||||
Supply Commitment [Line Items] | |||||||||||
Contingent milestone payments, maximum | $ 24,033,000 | € 20,500,000 | |||||||||
Amount of royalty payments due or payable | $ 0 | ||||||||||
Recro | Dexmedetomidine License Agreement | Minimum | |||||||||||
Supply Commitment [Line Items] | |||||||||||
Percentage of royalty payments | 10.00% | 10.00% | |||||||||
Recro | Dexmedetomidine License Agreement | Maximum | |||||||||||
Supply Commitment [Line Items] | |||||||||||
Percentage of royalty payments | 20.00% | 20.00% | |||||||||
Recro | Fadolmidine License Agreement | |||||||||||
Supply Commitment [Line Items] | |||||||||||
Amount of royalty payments due or payable | $ 0 | ||||||||||
Additional contingent milestones payment | $ 14,304,000 | € 12,200,000 | |||||||||
Recro | Fadolmidine License Agreement | Minimum | |||||||||||
Supply Commitment [Line Items] | |||||||||||
Percentage of royalty payments | 10.00% | 10.00% | |||||||||
Recro | Fadolmidine License Agreement | Maximum | |||||||||||
Supply Commitment [Line Items] | |||||||||||
Percentage of royalty payments | 15.00% | 15.00% |
Capital Structure - Additional
Capital Structure - Additional Information (Details) $ / shares in Units, $ in Thousands | Oct. 19, 2020Holder$ / sharesshares | May 29, 2020$ / sharesshares | Mar. 26, 2020$ / sharesshares | Feb. 13, 2020USD ($)$ / shares | Jan. 01, 2020shares | Nov. 21, 2019shares | Nov. 15, 2019shares | Sep. 30, 2020USD ($)$ / sharesshares | Nov. 05, 2020shares | Dec. 31, 2019$ / sharesshares |
Schedule Of Capitalization Equity [Line Items] | ||||||||||
Common stock, shares authorized to issue | 100,000,000 | 100,000,000 | ||||||||
Common stock, par value | $ / shares | $ 0.01 | $ 0.01 | ||||||||
Proceeds from public offering, net of transaction costs | $ | $ 23,085 | |||||||||
Common stock in public offering | 7,692,308 | |||||||||
Warrant to purchase of common stock | 527,100 | |||||||||
Proceeds from issuance of common stock underwriting discounts and commissions and offering expenses | $ | $ 23,085 | |||||||||
Preferred stock, shares authorized | 10,000,000 | 10,000,000 | ||||||||
Preferred stock, par value | $ / shares | $ 0.01 | $ 0.01 | ||||||||
Preferred stock, shares issued | 0 | 0 | ||||||||
Preferred stock, shares outstanding | 0 | 0 | ||||||||
Common stock, shares issued | 18,374,604 | 9,350,709 | ||||||||
Series A Warrants | Subsequent Event | ||||||||||
Schedule Of Capitalization Equity [Line Items] | ||||||||||
Common stock, shares issued | 6,677,447 | |||||||||
Warrants outstanding | 64,738 | |||||||||
Series B Warrants | Subsequent Event | ||||||||||
Schedule Of Capitalization Equity [Line Items] | ||||||||||
Common stock, shares issued | 6,677,447 | |||||||||
Warrants outstanding | 1,903,969 | |||||||||
MAM Eagle Lender, LLC | ||||||||||
Schedule Of Capitalization Equity [Line Items] | ||||||||||
Warrant to purchase of common stock | 527,100 | |||||||||
Common stock exercisable price per share | $ / shares | $ 4.59 | |||||||||
Series A Warrants | ||||||||||
Schedule Of Capitalization Equity [Line Items] | ||||||||||
Warrant to purchase of common stock | 7,692,308 | 7,692,308 | ||||||||
Common stock exercisable price per share | $ / shares | $ 4.59 | |||||||||
Series B Warrants | ||||||||||
Schedule Of Capitalization Equity [Line Items] | ||||||||||
Common stock in public offering | 804,616 | |||||||||
Warrant to purchase of common stock | 7,692,308 | 6,887,692 | ||||||||
Common stock exercisable price per share | $ / shares | $ 3.25 | |||||||||
Proceeds from issuance of warrants | $ | $ 2,458 | |||||||||
The Agreement | ||||||||||
Schedule Of Capitalization Equity [Line Items] | ||||||||||
Issuance of common stock upon separation | 441,967 | |||||||||
Common stock, par value | $ / shares | $ 0.01 | |||||||||
Proceeds from sales agreement | $ | $ 3,612 | |||||||||
Proceeds from public offering, net of transaction costs | $ | $ 25,000 | |||||||||
Paid sales commission | 3.00% | |||||||||
Exchange Agreement | Subsequent Event | ||||||||||
Schedule Of Capitalization Equity [Line Items] | ||||||||||
Agreement expiration date | Oct. 21, 2020 | |||||||||
Common stock, shares issued | 1,186,774 | |||||||||
Exchange Agreement | Series A Warrants | Subsequent Event | ||||||||||
Schedule Of Capitalization Equity [Line Items] | ||||||||||
Common stock, par value | $ / shares | $ 0.01 | |||||||||
Warrant to purchase of common stock | 8,646,154 | |||||||||
Warrants issued to purchase shares of common stock | 0.2 | |||||||||
Number of holders exchange warrants | Holder | 0 | |||||||||
Warrants expiration date | Apr. 26, 2021 | |||||||||
Exchange Agreement | Series B Warrants | Subsequent Event | ||||||||||
Schedule Of Capitalization Equity [Line Items] | ||||||||||
Common stock, par value | $ / shares | $ 0.01 | |||||||||
Warrant to purchase of common stock | 8,646,154 | |||||||||
Warrants issued to purchase shares of common stock | 0.2 | |||||||||
Number of holders exchange warrants | Holder | 0 | |||||||||
Warrants expiration date | Apr. 26, 2021 | |||||||||
Recro | ||||||||||
Schedule Of Capitalization Equity [Line Items] | ||||||||||
Right to receive common stock | 1 | |||||||||
Number of shares held for distribution of new shares | 2.5 | |||||||||
Issuance of common stock upon separation | 45,874 | 9,396,583 |
Capital Structure - Schedule of
Capital Structure - Schedule of Warrants Outstanding to Purchase Shares Common Stock Liability (Details) | Sep. 30, 2020$ / sharesshares |
Series A Warrants | |
Schedule Of Capitalization Equity [Line Items] | |
Number of shares warrants outstanding | shares | 7,692,308 |
Exercise price of warrants | $ / shares | $ 4.59 |
Warrants expiration date | Mar. 26, 2025 |
Series B Warrants | |
Schedule Of Capitalization Equity [Line Items] | |
Number of shares warrants outstanding | shares | 6,887,692 |
Exercise price of warrants | $ / shares | $ 3.25 |
Warrants expiration date | Apr. 26, 2021 |
MAM Eagle Lender Warrant | |
Schedule Of Capitalization Equity [Line Items] | |
Number of shares warrants outstanding | shares | 527,100 |
Exercise price of warrants | $ / shares | $ 4.59 |
Warrants expiration date | May 29, 2027 |
Capital Structure - Summary of
Capital Structure - Summary of Fair Value Assumptions Black Scholes Option Pricing Model (Details) $ in Thousands | Sep. 30, 2020USD ($) |
Schedule Of Capitalization Equity [Line Items] | |
Fair value | $ 10,228 |
Series A Warrants | |
Schedule Of Capitalization Equity [Line Items] | |
Fair value | $ 6,857 |
Remaining contractual term | 4 years 6 months |
Series B Warrants | |
Schedule Of Capitalization Equity [Line Items] | |
Fair value | $ 3,371 |
Remaining contractual term | 7 months 6 days |
Expected Volatility | Series A Warrants | |
Schedule Of Capitalization Equity [Line Items] | |
Fair value measurement warrant inputs | 0.7386 |
Expected Volatility | Series B Warrants | |
Schedule Of Capitalization Equity [Line Items] | |
Fair value measurement warrant inputs | 1.0147 |
Risk Free Interest Rates | Series A Warrants | |
Schedule Of Capitalization Equity [Line Items] | |
Fair value measurement warrant inputs | 0.0028 |
Risk Free Interest Rates | Series B Warrants | |
Schedule Of Capitalization Equity [Line Items] | |
Fair value measurement warrant inputs | 0.0011 |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Nov. 11, 2019 |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Stock-based compensation | $ 7,431,000 | $ 4,254,000 | |||
Aggregate intrinsic value of vested options | 0 | ||||
Aggregate intrinsic value of unvested options | $ 66,000 | ||||
Stock Options | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Stock options exercisable period | 10 years | ||||
Stock options vest period | 4 years | ||||
Weighted average grant-date fair value of the options awarded to employees | $ 2.22 | ||||
Stock Options Granted Outside Plan | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Number of options, Granted | 634,503 | ||||
Time-based RSUs Granted Outside Plan | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Number of restricted stock units granted | 176,307 | ||||
Stock Options And Time-based RSUs | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Unrecognized compensation expense related to unvested options and time-based RSUs, expected to vest | $ 10,720,000 | ||||
Time Based Restricted Stock | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Unrecognized compensation expense related to unvested options, weighted average period | 2 years 7 months 6 days | ||||
2019 Equity Incentive Plan | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Shares available for grant | 3,467,535 | 3,000,000 | |||
Percentage of outstanding common stock | 5.00% | ||||
Increase in share per "Evergreen" provision | 467,535 | ||||
Shares available for future grants | 1,076,396 | ||||
Recro Equity Plan | Stock Options | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Weighted average grant-date fair value of the options awarded to employees | $ 5.53 |
Stock-Based Compensation - Fair
Stock-Based Compensation - Fair Value of Options Estimated on Date of Grant Using Black-Scholes Option Pricing Model (Details) - Stock Options | 9 Months Ended |
Sep. 30, 2020 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Range of expected option life | 6 years |
Expected volatility | 73.77% |
Risk-free interest rate | 0.41% |
Recro Equity Plan | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Range of expected option life | 6 years |
Expected volatility | 79.96% |
Risk-free interest rate | 2.60% |
Stock-Based Compensation - Summ
Stock-Based Compensation - Summary of Stock Option Activity (Details) - $ / shares | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Dec. 31, 2019 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ||
Number of shares, beginning balance | 643,879 | |
Number of shares, Granted | 840,299 | |
Number of shares, Expired/forfeited/cancelled | (22,500) | |
Number of shares, ending balance | 1,461,678 | 643,879 |
Number of shares, Vested | 120,720 | |
Number of shares, Vested and expected to vest | 1,461,678 | |
Weighted average exercise price, beginning balance | $ 6.33 | |
Weighted average exercise price, Granted | 3.48 | |
Weighted average exercise price, Granted, Expired/forfeited/cancelled | 4.15 | |
Weighted average exercise price, ending balance | 4.72 | $ 6.33 |
Weighted average exercise price, Vested | 6.33 | |
Weighted average exercise price, Vested and expected to vest | $ 4.72 | |
Weighted average remaining contractual life | 9 years 6 months | 9 years 10 months 24 days |
Weighted average remaining contractual life, Vested | 9 years 2 months 12 days | |
Weighted average remaining contractual life, Vested and expected to vest | 9 years 6 months |
Stock-Based Compensation - Su_2
Stock-Based Compensation - Summary of RSUs Activity (Details) - Restricted Stock Units | 9 Months Ended |
Sep. 30, 2020shares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Number of shares, beginning balance | 1,380,030 |
Number of shares, Granted | 377,351 |
Number of shares, Vested and settled | (50,240) |
Number of shares, Expired/forfeited/cancelled | (6,000) |
Number of shares, ending balance | 1,701,141 |
Number of shares, Expected to vest | 1,701,141 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Related Party Transaction [Line Items] | ||||
Income related to the transition services agreement | $ 516 | $ 1,548 | ||
Recro | ||||
Related Party Transaction [Line Items] | ||||
Net payable to related party | 39 | 39 | ||
Irish Subsidiary | Managing Director | HiTech Health | ||||
Related Party Transaction [Line Items] | ||||
Related party transaction expenses | $ 5 | $ 11 | $ 133 | $ 115 |
Service agreement date | 2017-11 |
Retirement Plan - Additional In
Retirement Plan - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Compensation And Retirement Disclosure [Abstract] | ||||
Percentage of company's matching contribution with respect to each participant's contribution | 100.00% | |||
Company matching contributions to maximum employees eligible compensation | 5.00% | |||
Total company contributions to 401 (k) plan | $ 188 | $ 45 | $ 449 | $ 281 |
Subsequent Events - Additional
Subsequent Events - Additional Information (Details) - Subsequent Event $ in Thousands | Nov. 09, 2020USD ($)Employee |
Subsequent Event [Line Items] | |
Number of positions reduced | Employee | 40 |
Estimation of severance pay and other related termination benefits costs | $ | $ 1,500 |